SecProbe.io

July 29, 2011
 Via E-mail

Mr. Jonathan Symonds
Chief Financial Officer
Novartis AG
Lichtstrasse 35
4056 Basel, Switzerland

Re: Novartis AG
  Form 20-F for Fiscal Year Ended December 31, 2010
  Filed January 27, 2011
  File No. 1-15024

Dear Mr. Symonds:
 We have reviewed your June 30, 2011 response to our June 2, 2011 comment
letter and have the following comments.

Please respond to this letter within te n business days by providing the requested
information or by advising us when you will provide the requested response.  If you do not believe a comment applies to your facts a nd circumstances, please tell us why in your
response.  Please furnish us a letter on EDGA R under the form type label CORRESP that
keys your response to our comments.
 After reviewing the information provi ded, we may raise additional comments
and/or request that you amend your filing.

Business Overview

Pharmaceuticals
Compounds in Development, page 38

1. Please refer to prior comment one.  We acknowledge your assertions that
development decisions are made on a pr oject-by-project basis and that R&D
expenditures are not managed on a therapeu tic or some other “project grouping”
basis. Please provide us proposed disclosure to be included under “Research and
Development” in your “Operating and Financial Review and Prospects”
disclosure of future filings to address the following.

 Quantify the portion of total research and development expenditures for each
period presented spent on “explorator y development” activities and the
portion spent on “confirmatory developm ent” activities (listed on pages 38-

Mr. Jonathan Symonds
Novartis AG July 29, 2011 Page 2
 42). In addition, explain the factors unde rlying any changes in trends for each
of these activities in 2010 as comp ared to 2009 and expected in 2011 as
compared to 2010.
 Identify and quantify those projects listed on pages 42-46 that represent a
significant amount of expenses for each period presented in the “confirmatory
development” phase.

2. We acknowledge your response to prior co mment two (third bullet).  However,
we request further information in orde r to understand your a ssertion that the
ultimate patent terms of your develo pment projects cannot be known with
certainty prior to product approval and woul d inherently be speculative.  In this
connection, we believe that you should provide us this information where
reasonable estimates can be made, as opposed to a threshold of “known with
certainty.”  For any three of your projects that were in regist ration at December
31, 2010 and for any three of your projects that, at December 31, 2010, you had a planned filing date in 2011,  please provide us with the following information assuming the product received approval as of December 31, 2010:

 The remaining years of the last patent that protects the product;
 The nature of and number of years of  regulatory exclusivity available in
excess of remaining years of  the patent in bullet one;
 How each year beyond December 31, 2010, th e assumed approval date, to get
actual approval impacts the number of years in bullets one and two; and
 The nature of other significant factor s and how each could impact the number
of years in bullets one and two.
 In providing the above information, it is not necessary to provide the actual name
of the product in your response and it is sufficient to address only one jurisdiction
in which you intend to get approval.
 Notes to the Novartis Group Cons olidated Financial Statements

Note 2:  Significant transactions, business combinations and divestments
Acquisitions in 2010: Corporate—Alcon, Inc., page F-21

3. We are evaluating your responses to prior comments four through eight and
may have additional comments.

4. Please analyze for us whether the written put associated with the 52% interest in
Alcon or the related purchased call are fina ncial assets or liabilities required to
be accounted for at fair value through profit or loss from your transaction in
2008 through settlement in 2010.  Please  reference for us the authoritative
literature you rely upon to support your accounting.

Mr. Jonathan Symonds
Novartis AG July 29, 2011 Page 3
 Please contact Frank Wyman, Staff Acc ountant, at (202) 551-3660 or Mark
Brunhofer, Senior Staff Acc ountant, at (202) 551-3638, if you have any questions
regarding these comments. In this regard, do not hesitate to c ontact me at (202) 551-
3679.
Sincerely,  /s/ Jim B. Rosenberg
Jim B. Rosenberg
Senior Assistant Chief
Accountant