Novartis Announces Ambitious ESG Targets to Increase Access to Medicines and Achieve Full Carbon Neutrality

Novartis hosted a virtual investor event to provide a comprehensive overview of the company’s progress in its Environmental, Social and Governance (ESG) strategy.

“ESG is a key strategic priority for the Novartis Board and Executive Committee and we made progress in all of our key ESG strategic pillars,” said Joerg Reinhardt, Chairman of Novartis. “Moving forward, we are further reinforcing the way we measure our impact with a set of new ESG targets, increasing our ambition to drive more value for society.”

Novartis focuses on 4 key strategic ESG pillars defined as material by stakeholders; Ethical Standards, Pricing and Access, Global Health Challenges and Corporate Citizenship. The company has developed ambitious and challenging targets against key elements in each of these areas. These include addressing access and global health challenges, which are areas with the highest unmet need worldwide and where Novartis can have the greatest material ESG impact. Novartis is also reinforcing its ambition to be a leader in environmental sustainability in the healthcare industry, further strengthening its already ambitious target for carbon neutrality to include its entire supply chain by 2030.

Vas Narasimhan, CEO of Novartis, said “Novartis continues to take bold steps to deepen our impact on major global challenges, like access to medicines and climate change. By establishing targets to measure what matters most for stakeholders, we are further embedding ESG into the core of our business operations and strengthening our committment  to communicating our progress in a transparent way.”

New targets to expand impact on access to medicines and climate change

As part of the company’s ambition to expand access to innovative medicines in low- and middle-income countries (LMICs) Novartis is committing to increase patient reach with its strategic innovative medicines by at least 200% by 2025. In addition, Novartis plans to increase patient reach of its global health flagship programs in Leprosy, Malaria, Chagas Disease and Sickle Cell Disease (SCD) by at least 50% over the same time period. Novartis estimates achievement of these targets to result in a potential reach of over 23 million patients across both initiatives.

Novartis also further strengthened its carbon neutrality target to aim for full carbon neutrality across its supply chain (Scope 1, 2, 3) by 2030, in addition to its already stated target for carbon neutrality in its own operations by 2025. This new target replaces the previous target aiming for a 50% reduction (vs a 2016 baseline) in carbon emissions across the supply chain.

Novartis also announced a collaboration with the African Union (55 Member States which represent all the countries on the African continent) initiated Africa Medical Supplies Platform (AMSP) to support the supply of medicines from the Novartis COVID-19 Pandemic Response Portfolio.  This portfolio of 15 medicines, including Dexamethasone, for symptomatic treatment of COVID-19 for LMICs was launched in July 2020 and is provided through Sandoz, the generics and biosimilar division of Novartis. AMSP, a non-profit initiative, provides an online platform that aggregates certified medical equipment, clinical management devices and medicines to supply African governments in need of critical COVID-19 supplies. This new collaboration aims to help alleviate supply and logistical constraints by ensuring efficient and rapid access of the COVID-19 Pandemic Response Portfolio medicines to African governments.

Key highlights on progress in the last 12 months:

Novartis also highlighted the strong progress made in the last 12 months on a number of key areas, reinforcing ESG as a cornerstone of its strategy.

Access Principles – Novartis launched its Access Principles2 in 2018 and committed to systematically integrating access strategies in how it researches, develops and delivers all new medicines. Through Emerging Market Brands (EMBs) and broader access strategies, Novartis reached 376,000 patients in the first half of 2020. Novartis also established a new business strategy and single organization to broaden patient reach and availability of its portfolio of medicines in sub-Saharan Africa (SSA), which is home to the largest underserved patient population in the world. The newly formed sub-Saharan Africa unit is deploying innovative approaches to sustainably double patient reach across the full income pyramid by 2022. Adding to partnerships with Clinton Health Access Initiative (CHAI) and AMSP, Novartis SSA unit is also starting strategic partnerships with different governments to ensure better access to Novartis medicines.

Response to COVID-19 Pandemic – Novartis has made significant contributions to the global effort to combat the COVID-19 pandemic and support the stability of global healthcare systems. These include leveraging its R&D capabilities, clinical trials expertise, supply of medicines and philanthropic aid. There are in total over 15 Novartis medicines being studied in 35 investigator-initiated trials around the world. The company completed enrollment in CAN-COVID Phase III clinical trial, studying canakinumab in patients with COVID-19 pneumonia, with an expected readout in Q4 2020. Novartis also continues a Phase III clinical trial to evaluate the use of ruxolitinib in COVID-19 patients with a severe immune reaction. The company has agreed to donate USD 40 million to support communities around the world impacted by the pandemic. In addition, Novartis continues to be active in cross-industry research initiatives such as the COVID-19 Therapeutics Accelerator, coordinated by the Bill & Melinda Gates Foundation, Wellcome, and Mastercard, as well as a COVID-19 directed partnership supported by the Innovative Medicines Initiative (IMI).

Ethical Standards – Continuing its long term journey to build trust with society, Novartis also resolved its material legacy litigation matters including the settlements related to Foreign Corrupt Practices Act (FCPA) and US speaker programs. To further reinforce principles-based thinking and ethical decision-making in the organization and through interactions with external stakeholders, the new Novartis Code of Ethics which was co-created by thousands of our associates and is embedded in an innovative decision making framework, launched early September.

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