Ipsen Sa · EURONEXT:IPN
Ipsen Sa — FY2013 Earnings Presentation
40 slides from Ipsen Sa's earnings presentation, March 2014
Slide 1: Ipsen 2013 Financial Results
Ipsen 2013 Financial Results Bryan Garnier Roadshow - March 3/4, 2014 IPSEN pour nom de la société - 07/04/2011 / page 1
Slide 2: Disclaimer
Disclaimer This presentation includes only summary information and does not purport to be comprehensive. Forward-looking statements, targets and estimates contained herein are for illustrative purposes only and are based on management’s current views and assumptions. Such statements involve known an
Slide 3: Safe Harbor
Safe Harbor The Group operates in certain geographical regions whose governmental finances, local currencies or inflation rates could be affected by the current crisis, which could in turn erode the local competitiveness of the Group’s products relative to competitors operating in local currency, an
Slide 4: Agenda
Agenda 1 2013 overview Marc de Garidel Chairman and CEO Christel Bories 2 2013 performance Deputy CEO Susheel Surpal CFO 3 US update Marc de Garidel Chairman and CEO 4 2014 outlook Marc de Garidel Chairman and CEO 4 Bryan Garnier Roadshow - March 3/4, 2014
Slide 5: 2013 operating margin above guidance, despite sales headwinds
2013 operating margin above guidance, despite sales headwinds 2013 initial 2013 revised 2013 actuals guidance(1) guidance(2) Specialty Care - Drug sales(*) [6.0% ; 8.0%] ~ +3.0% +3.0% Primary Care - Drug sales(*) [-8.0% ; -6.0%] ~ (1.0)% (0.1%) Recurring Adjusted(**) operating margin ~ 16.0% ~ 1
Slide 6: 2013, acceleration of transformation and major clinical successes
2013, acceleration of transformation and major clinical successes Four Phase III programs delivered Enhanced R&D delivery and focus Major step forward in toxin research and Intellectual Property with Syntaxin acquisition and Harvard partnership Christel Bories appointed Deputy CEO Acceleration of Sp
Slide 7: In 2013, Ipsen delivered four Phase III on Dysport and Somatuline
In 2013, Ipsen delivered four Phase III on Dysport® and Somatuline® Clinical development phase Data published Molecule/Drug Phase III Full results Dysport® Next Generation – CD – Europe Phase III Full results Dysport® AUL Spasticity Phase III Full results Somatuline® in NET tumor control – WW –
Slide 8: Ipsen share price up 50% in 2013, reflecting good momentum
Ipsen share price up 50% in 2013, reflecting good momentum Share price (€) 35 +50% 30 +20% 25 +19% 20 15 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Ipsen STOXX Europe TMI Pharmaceuticals SBF 120 Note: SBF 120 and STOXX Europe TMI Pharma. have been rebased at
Slide 9: 2013 performance - Above EBIT
2013 performance Above EBIT
Slide 10: Specialty care sales growth affected by Decapeptyl performance and Increlex shortage
Specialty care sales growth affected by Decapeptyl® performance and Increlex® shortage Drug sales – FY 2013 in million euros – % excluding foreign exchange impact ® Decapeptyl (1.9%) 298.6 ® Somatuline +11.1% 246.9 Specialty care ® Specialty care Dysport +7.0% 242.2 €871.1m Nutropin ® +5.7% 56.3 +3.
Slide 11: 2013 sales driven by international primary care and specialty care
2013 sales driven by international primary care and specialty care GROUP SALES growth: +0.4% (incl. Drug related sales) FY sales in million euros At constant currency: +2.2% Specialty FX International care(1) (20.8) French PC PC Increlex® 39.8 (27.1) 26.8 (14.8) Primary care Specialty care 1,219.5 1
Slide 12: Specialty care volume growth driven by Somatuline and Dysport
Specialty care volume growth driven by Somatuline® and Dysport®, affected by Decapeptyl® performance 2013 volume and value growth 2013 geographic distribution 11.5% Somatuline® 11.1% Somatuline® 51% 14% 13% 22% 9.4% 11.1% Dysport® 7.0% Dysport® 20% 9% 48% 23% 2.6% 0.2% Decapeptyl® -1.9% Decapeptyl®
Slide 13: Dynamic international growth, France now down to 30% of primary care sales
Dynamic international growth, France now down to 30% of primary care sales Evolution of Primary care sales 100% International 75% 2005-2013 CAGR(1): +9% 70% 50% France 25% 2005-2013 CAGR(1): (12%) 30% 0% 2005 2006 2007 2008 2009 2010 2011 2012 2013 Primary care 384 390 393 383 380 364 368 325 320 sa
Slide 14: Ipsen growth fuelled by a differentiated emerging market footprint
Ipsen growth fuelled by a differentiated emerging market footprint, soon to be supported by the US Ipsen largest affiliates Ipsen geographical split 2010 2013 1 France France Developped 2 China China RoW 3 Italy Russia 14% 4 Spain Italy 41% G5(1) 5 Russia Germany 6 Germany UK Emerging(2) 40% 7 US Sp
Slide 15: Tight Opex control allowed to finance R&D while growing EBIT margin
In the context of 2013 lower sales growth, tight Opex control allowed to finance R&D while growing EBIT margin Recurring adjusted(3) EBIT margin Growth (%)(1) 15% 17.0% 13.3% 16.3% 10% 5.6% 6.6% 5% 5.4% 4.4% R&D costs(2) 5.1% 2.5% 0.4% Sales 0% (2.0%) OPEX costs (excl. R&D) -5% FY 2011 FY 2012 FY 20
Slide 16: From reported to Recurring adjusted Operating Income
From reported to Recurring adjusted Operating Income FY 2012 21.5 In million euros 2.4 62.1 198.3 117.1 Reported Restructuring Impairment Other Recurring EBIT adjusted EBIT +5.2% +62.9% Recurring As reported adjusted 5.1 12.6 0.2 208.6 190.7 FY 2013 Reported Restructuring Impairment Other Recurring
Slide 17: 2013 performance - Below EBIT
2013 performance Below EBIT
Slide 18: P&L summary
P&L summary FY 2012 in m€ FY 2013 Change restated* Net sales 1,219.5 1,224.8 +0.4% Other revenues 57.9 57.0 (1.5)% Revenue 1,277.4 1,281.8 +0.3% Cost of goods sold (254.3) (253.4) (0.4)% Research and development expenses (248.2) (259.1) +4.4% Selling expenses (473.0) (451.3) (4.6)% General and admin
Slide 19: Main P&L items: Below operating income
Main P&L items: Below operating income Financial Result (€m) Effective tax rate Reported Recurring Reported Recurring adjusted(1) adjusted(1) 20.6% 23.3% 21.8% 20.6% 5.4 (9.0) FY 2012 FY 2013 FY 2012 FY 2013 Net income from discontinued operations (€m) EPS (€) Reported Recurring Adjusted(1): FY 2012
Slide 20: Balance sheet evolution
Balance sheet evolution ASSETS LIABILITIES FY 2012 FY 2012 in m€ FY 2013 in m€ FY 2013 Restated Restated Goodwill 298.2 310.7 Capital and reserves 902.5 971.5 Investments in associates 0.0 0.0 Minority interest 2.0 2.2 Property, plant and 281.8 287.5 Total equity 904.5 973.7 equipment Other intangib
Slide 21: Solid cash flow generation
Solid cash flow generation FY 2012 in m€ FY 2013 Restated Consolidated net profit (27.5) 153.1 Non cash and non operating items 177.6 56.2 of which Depreciation, amortization, provisions 70.2 25.7 of which Impairment losses 123.1 12.6 of which Change in deferred taxes (24.1) 8.2 Cash flow from opera
Slide 22: 2013: Key financial achievements
2013: Key financial achievements Group sales up 2.2%(1) Strong Recurring Adjusted(2) Operating margin of 17%(3) Net profit of €153.1m versus a (€27.5m) loss in 2012 Robust Recurring Adjusted(2) EPS of €1.85, up 5.1% year-on-year Sound operating cash flow generation Closing cash balance of €125.4m Pr
Slide 23: US update
US update
Slide 24: Increasing US presence, a strategic priority
Increasing US presence, a strategic priority Global Pharma Market(*) Ipsen 2013 sales Developped G5(1) RoW Developped RoW 15% 14% 21% 41% G5(1) 34% United 40% 30% Emerging(2) States Emerging 5% United States US under-represented in Ipsen sales Reaching critical mass in the US is key to drive Group p
Slide 25: Somatuline well positioned in the US to seize significant NET opportunity
Somatuline® well positioned in the US to seize significant NET opportunity Favorable competitive position Potential addressable market (2013) Differentiated NET data package Acromegaly with CLARINET® c.$100m (2) Strong position gained in acromegaly(1) Ipsen addressable market with ~ 50% market share
Slide 26: Ipsen to launch Somatuline in NET indication in the US
Ipsen to launch Somatuline® in NET indication in the US to capture full value Rationale Impact Secure long term value Secure Ipsen US strategic presence Expected maximum incremental annual cost of €[30-40]m Build long term presence in US oncology US breakeven(1) postponed to Maintain full contro
Slide 27: Cynthia Schwalm to manage US operations and secure Somatuline NET launch
Cynthia Schwalm to manage US operations and secure Somatuline® NET launch Cynthia Schwalm Key challenges 30 years of experience in oncology and neurology Build US oncology sales force In-depth knowledge of the American pharmaceutical market Secure Somatuline® GEP NET label Appointed Head of Ip
Slide 28: 2014 outlook
2014 outlook
Slide 29: 2014 financial objectives
2014 financial objectives Specialty care – Drug sales Growth of +4.0% to +6.0%, year-on-year – Driven by normalization of situation in China, in a context of continued pricing pressure and uncertainty on Increlex® US resupply Primary care – Drug sales Decline of -2.0% to 0.0%, year-on-year – Excludi
Slide 30: Moving parts to impact 2014 EBIT
Moving parts to impact 2014 EBIT Illustrative chart Evolution of EBIT margin at constant currency Cost saving R&D Full year Full year initiatives investment impact of US impact of restructuring Cost France PC inflation NET restructuring Contribution investment topline growth In the US FY13 FY14 EBIT
Slide 31: Major R&D and regulatory milestones to come in 2014
Major R&D and regulatory milestones to come in 2014 H1 2014 H2 2014 2015 Tasquinimod mCRPC TasQ maintenance study PhIII results (PFS and OS data) PhIIa (POC) results Dysport® NDO Tasquinimod (HCC, RCC, Gastric & Ovarian) Full PhII data PhII results(1) R&D Dysport® NG Dysport® PLL Dysport® PUL PhIII
Slide 32: In 2014, continued business development efforts to complement organic growth
In 2014, continued business development efforts to complement organic growth Areas of focus In-licensing or acquisition of marketed drugs Commercial deals Acquisition of small companies Various geographies targeted, notably the US Late stage compounds (Phase III) in various therapeutic areas
Slide 33: Key takeaways
Key takeaways Strong operating performance and major 2013 clinical successes setting the stage for future growth TasQ phIII clinical results, preparation of NET US launch 2014 and continued operating efficiencies 33 Bryan Garnier Roadshow - March 3/4, 2014
Slide 34: Back up
Back up
Slide 35: Demonstration of antiproliferative effect of Somatuline in GEP-NETs
Demonstration of antiproliferative effect of Somatuline® in the treatment of GEP-NETs 100 Key results Patients alive and with no progression (%) 90 Lanreotide Autogel 120 mg 62% of GEP-NET patients treated with 80 Somatuline® had not progressed or died versus 22% with placebo 70 60 62% Disease p
Slide 36: Ipsen's R&D toxin platform reinforced by Syntaxin acquisition
Ipsen’s R&D toxin platform significantly reinforced by Syntaxin acquisition From natural BoNT expertise… … to full recombinant potential Ipsen Syntaxin Pharmaco- Toxin Manufacturing logical engineering Potential to Targeted combine Scale-up Secretion toxins Inhibitors and peptides Pre-clinical / Rec
Slide 37: Positive initial results for Dysport in Adult Upper Limb spasticity
Positive initial results for Dysport® in Adult Upper Limb spasticity Potential expansion of Dysport® indications Initial results in the US Aesthetic use 243 adult hemiparetic spastic patients (marketed by Valeant) Cervical Dystonia (marketed by Ipsen) Multicentric, prospective, double blind, ran
Slide 38: Ipsen potentially first to launch ready-to-use toxin A with Dysport Next Generation
Ipsen, potentially the first company to launch a ready-to-use toxin A with Dysport® Next Generation Key characteristics First ready-to-use toxin A formulation Full product range Improved focus on patient care Ability to reach more patients in need of treatment 2 separate regulatory pathways
Slide 39: Ipsen's R&D reinforced through partnerships
Ipsen’s R&D reinforced through partnerships ENDO- CRINOLOGY NEUROLOGY ONCOLOGY 2003 - 2005 2006 - 2013 Tasquinimod, an illustration of Ipsen’s R&D open model 39 Bryan Garnier Roadshow - March 3/4, 2014
Slide 40: Tasquinimod, a new first-in-class oral anti-cancer therapy
Tasquinimod, a new first-in-class oral anti-cancer therapy A unique MoA targeting the tumor’s microenvironment, mainly by binding the S100A9 protein Tasquinimod, potentially a new therapeutic option for chemo naïve patients with metastatic CRPC (1) Adapted from Raymond et al, Cancer Chemother Pharma