Novartis CEO pours cold water over M&A talk -paper

PARIS, Sept 17 (Reuters) - Novartis (NOVN.VX) chief executive Daniel Vasella on Monday poured cold water over rumours of large pending merger and acquisition activity in the pharmaceuticals industry.

"I have no indication that could confirm any rumours about tie-ups between big players in the sector," Vasella told French newspaper La Tribune in an interview.

Asked about a possible link between the Swiss firm and Germany's Bayer BAYG.DE, he declined comment.

"We do not comment on rumours. As an observer one has to ask oneself a question about the logic. Who stands to benefit? Certain investors and hedge funds could gain a lot of money thanks to such rumours," Vasella said.

Vasella said 2007 would be another record year for Novartis, even though the second half would be less solid for pharmaceuticals. The first half of 2008 would also be difficult but from July 2008 there would again be double-digit growth at pharmaceuticals.

"We have 12 months to reorganise ourselves and optimise our cost base and investments," he said.