H. Lundbeck A/S Class A · OMXCOP:HLUN_A
H. Lundbeck A/S Class A — Q3 2007 Earnings Presentation
43 slides from H. Lundbeck A/S Class A's earnings presentation, Nov 21, 2007
Slide 1: Investor Presentation Q3 2007 Financial Results
Investor Presentation Q3 2007 Financial Results
Slide 2: Safe Harbour Statement
Safe Harbour Statement This presentation contains forward-looking statements that provide our expectations or forecasts of future events such as new product introductions, product approvals and financial performance. Such forward-looking statements are subject to risks, uncertainties and inaccurate
Slide 3: Lundbeck is an international pharmaceutical company specializing in CNS disorders
Lundbeck is an international pharmaceutical company specializing in central nervous system disorders Facts on Lundbeck: Æ Founded by Hans Lundbeck in 1915 Æ An integrated company with core competencies in research, development, production, marketing and sales Æ International presence with pharmaceut
Slide 4: CNS: world's biggest niche
CNS: world’s biggest niche (17% of world pharmaceutical sales)… 2006 CNS market USD Lundbeck focus billion 100.7 (+7%) Depression, N6A 20% Psychosis, N5A (2%) CAGR of 13% 1990-2006 Alzheimer’s disease, N7D 17% (+11%) Parkinson’s disease, N4A 5% (+16%) Sleep, N5B 3% (+12%) 5% (+19%) Alcohol dependenc
Slide 5: Broad CNS portfolio of current products and late-stage projects
… and Lundbeck holds a broad CNS portfolio of current products and projects in late-stage development Launched products Late-stage pipeline Cipralex®, 2002 / Lexapro®, 2002 Lu AA 21004, phase II Depression, N6A (US partner, Forest Labs.) Lu AA24530, phase II Bifeprunox (Solvay), phase III Psychosis,
Slide 6: Sales infrastructure in Europe and International Markets, expanding into US and Japan
Sales infrastructure in place in Europe and International Markets – expanding into US and Japan US: CNS specialist sales force to be established supporting the potential launch of future compounds Europe: Fully fledged CNS sales infrastructure International markets: CNS sales infrastructure in
Slide 7: Financial figures Q3 2007
Financial figures Q3 2007 As percent of total revenue Reported figures (excl. one-off items in brackets) Q3 Q3 10% (2%) Cipralex® (+19%) DKKm 2007 2006 Growth Lexapro® (+46%) Revenue 2,960 2,248 32% 15% 35% (38%) (16%) Ebixa® (+27%) R&D 485 420 16% 0.4% Azilect® (+143%) EBIT 1,079 630 71% 1.6% Serdo
Slide 8: International Markets grew 28% in Q3 2007
International Markets grew 28% in Q3 2007 and continue to increase share of revenue Q3 2004 Q3 2007 International Markets - International Markets – 14% of Group revenue 21% of Group revenue * % of revenue Q3 Q3 in International 2004 2007 Markets Cipralex 35% 56% Ebixa 7% 13% Serdolect - 1% Azilect -
Slide 9: Improving European profitability continuously
Improving European profitability continuously… SG&A margin DKKm / FTE in Europe 6,000 60% Ongoing targeting programme is lowering the number of sales reps 4,000 40% in Europe Increasing revenue with a focus on cost structure is lowering the SG&A margin in Lundbeck’s 2,000 20% subsidiaries In e
Slide 10: International Markets follow same trend
..and International Markets follow same trend SG&A margin DKKm / FTE in Int’l. 3,000 60% Revenue growth with focus on long term cost structure improve 2,000 40% margins Continued growth potential in International Markets 1,000 20% 0 0% 2003 2004 2005 2006 Q3 2007 International Markets revenue (D
Slide 11: Branded market position - three leading compounds
Branded market position - Lundbecks three leading compounds Cipralex®/Lexapro® Ebixa® (memantine)** USA Europe #1 in volume (August 07) #2 in volume (August 07) #2 in value (August 07) #2 in value (August 07) Europe International Markets* #2 in volume (Q2 07) #1 in volume (August 07) #2 in value (Q2
Slide 12: Cipralex/Lexapro performance in Europe and International markets
Cipralex® / Lexapro® - continued positive performance in Europe and International markets Antidepressant market Europe International markets Market share, value – market growth, volume Market share, value – market growth, volume 20% 20% 20% 20% combined 17.0% 15% 15% 15% 15% Cipralex® 13.8% combined
Slide 13: Lexapro - maintaining branded market position in US
Lexapro® - maintaining branded market position in US Antidepressant market USA Market share, value – market growth, volume 25% 25% combined 22.6% Lexapro is the most prescribed antidepressant in the US 20% 20% Lexapro® 22.3% Marketed by Forest Laboratories, Inc. 15% 15% 10% 10% 5% 5% citalopram
Slide 14: Ebixa - second most prescribed anti-alzheimer product
Ebixa® (memantine) – the second most prescribed anti-alzheimer product Anti-alzheimers market Europe International markets Market share, value – market growth, volume Market share, value – market growth, volume 25% 40% 25% 40% combined 22.8% combined 19.9% 20% 20% 30% 30% Ebixa® 15.3% 15% 15% 20% Eb
Slide 15: Azilect - successful introduction in Europe
Azilect® - successful introduction in Europe Anti-parkinsons market shares Europe Market share, value – market growth, volume 5% 5% Azilect® 4.2% Lundbeck has launched Azilect® in 4% 4% more than 20 countries 3% 3% Once daily treatment Approved for monotherapy and 2% 2% adjunct therapy with le
Slide 16: Serdolect - launched in more than 20 countries
Serdolect® - launched in more than 20 countries Value conversion Value conversion driving growth Europe – antipsychotic market in volume in European market DDDm 1500 Serdolect® is developed by Underlying growth in atypical 45% 49% 51% antipsychotics: +5% Lundbeck and the company holds 1000 world
Slide 17: Launch of new compound - Circadin
Launch of new compound – Circadin® Global value market for N5B – USD 5.4 billion European insomnia market 2006 – Lundbeck has rights for approx. Approx. USD 1 billion 80% of European market Approved for treatment of primary 67% insomnia for patient aged 55+ North America Expected launch in fir
Slide 18: Financial guidance
Financial guidance Financial guidance (excl. one-off items) 2006 actual 2007 guidance More than DKK 1,784 million EBIT DKK 2.6 billion 19.3% EBIT margin 25% Approx. DKK 762 million Capex DKK 650 million Page 18
Slide 19: Pharmaceuticals in clinical development
Pharmaceuticals in clinical development Indication Development step Registration Expected Compound Activity Phase I Phase II Phase III application launch Schizophrenia Dopamine/ Serdolect US serotonin 2008 2009 Schizophrenia Dopamine/ Bifeprunox serotonin 2009+ Stroke Desmoteplase Plasminogen activa
Slide 20: Bifeprunox (phase III) for schizophrenia
Late stage pipeline – Bifeprunox (phase III) for the treatment of schizophrenia Bifeprunox is a latest generation atypical antipsychotic Inlicensed from Solvay in Belgium and is jointly developed with Solvay and Wyeth (North American rights) Strategic fit: Fits well into Lundbeck’s position wi
Slide 21: Desmoteplase (phase III) for ischaemic stroke
Late stage pipeline - Desmoteplase (phase III) for the treatment of ischaemic stroke Potentially first compound to treat patients Prevalence within an up to 9 hours treatment window Stroke patients, mio. Inlicensed from PAION, Germany 0,9 0,6 0,6 0,6 0,2 0,3 Lundbeck holds world wide rights ex
Slide 22: Nalmefene (phase III) for alcohol dependence
Late stage pipeline - Nalmefene (phase III) for the treatment of alcohol dependence Potentially new treatment paradigm Prevalence Inlicensed from BioTie, Finland Estimated 5-6% of population suffers from Lundbeck holds world wide rights alcohol abuse or heavy drinking excluding North America,
Slide 23: Appendix
The specialist in psychiatry J wndbeck and pioneer in neurology
Slide 24: More information please contact Investor Relations
More information please contact Investor Relations Jacob Tolstrup Director, Investor Relations Tel: +45 36 43 30 79 Fax: +45 36 43 82 62 [email protected] Page 24
Slide 25: Lundbeck share
Lundbeck share Share information: Trading code: Free float (approximately 62m Reuters (LUN.CO) / Bloomberg (LUN DC) shares) is traded 2+ times over ISIN Number DK0010287234 Unsponsored ADR programmes annually (daily trade of HLUKY, CUSIP 40422M107 approximately 0.7m) Index examples: End of
Slide 26: Revenue - by product / by region
Revenue – by product / by region International Total Europe USA Markets Q3 Q3 Q3 Q3 Q3 Q3 Q3 Q3 DKKm 2007 2006 2007 2006 2007 2006 2007 2006 Total revenue 2,960 2,248 1,408 1,269 701 482 569 443 Growth 32% 11% 45% 28% Cipralex® 1,046 878 728 643 - - 318 235 Growth 19% 13% 35% Lexapro® 699 479 - - 69
Slide 27: Revenue, 5 year figures
Revenue, 5 year figures Revenue, DKK million Growth, % 2002 2003 2004 2005 2006 2003 2004 2005 2006 Total revenue 9,488 9,941 9,733 9,070 9,221 5% (2)% (7)% 2% Cipralex® 78 645 1,661 2,625 3,508 729% 157% 58% 34% Lexapro® 777 1,928 2,420 2,552 1,923 148% 26% 5% (25)% Ebixa® 29 286 722 1,105 1,361 89
Slide 28: Revenue, quarterly figures
Revenue, quarterly figures Revenue, DKK million Growth, Y/Y, % Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2006 2007 2007 2007 2006 2007 2007 2007 Total revenue 2,543 2,583 2,612 2,960 10% 16% 19% 32% Cipralex® 937 990 1,027 1,046 26% 18% 20% 19% Lexapro® 525 628 641 699 (16)% 30% 47% 46% Ebixa® 374 391 409 432 22% 26%
Slide 29: Cost, 5 year figures
Cost, 5 year figures DKK million Growth, Y/Y, % 2002 2003 2004 2005 2006 2003 2004 2005 2006 Revenue 9,488 9,941 9,733 9,070 9,221 5% (2)% (7)% 2% Production costs 1,818 1,758 1,725 1,488 1,646 (3)% (2)% (14)% 11% Distribution costs 2,458 2,478 2,302 2,337 2,419 1% (7)% 2% 4% Administration costs 1,
Slide 30: Cost, quarterly figures
Cost, quarterly figures DKK million Growth, Y/Y, % Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2006 2007 2007 2007 2006 2007 2007 2007 Revenue 2,543 2,583 2,612 2,960 10% 16% 19% 32% Production costs 417 497 398 457 42% 18% (9)% 23% Distribution costs 685 578 590 584 8% (2)% (9)% 17% Administration costs 419 377 384 35
Slide 31: USD hedging on a rolling basis
Lundbeck hedge the USD on a rolling basis up to 12 months ahead – 2007 USD hedge rate of 5.75 Actual rates Forward rates 10 9 8 7.90 7 6.68 6 6.00 5.89 5.88 5.76 5.70 5.66 5.52 5.48 5 5.29 Quarterly figures 4 '03 '04 '05 '06 Q1 Q2 Q3 Q4 Q1 Q2 Q3 '07 '07 '07 '07 '08 '08 '08 Average US$ exchange rate
Slide 32: Recognition of income from Forest
Lundbeck recognition of income from Forest Settlement to full royalty P&L Expected sales price Balance P&L (prepayment at USD spot at bulk delivery) Minimum price P&L* At bulk delivery At US sales * Hedging effect at bulk delivery recognised on P&L: Gain/loss from difference in delivery at expected
Slide 33: Depression: Cipralex/Lexapro best-in-class
Cipralex® / Lexapro® - best-in-class Comparator Presented Main outcome Venlafaxine XR SCNP, April 2003 Escitalopram was at least as effective and was better tolerated than (Effexor) venlafaxine XR.Escitalopram treated patients reached sustained response and remission significantly faster. Venlafaxin
Slide 34: Anxiety: Cipralex/Lexapro best-in-class
Cipralex® / Lexapro® - best-in-class Comparator Presented Main outcome Paroxetine SCNP, April 2003 Escitalopram was significantly superior to paroxetine after 24 weeks of (Paxil) treatment of SAD and showed fewer discontinuation effects. Anxiety Paroxetine ACNP, December 2003 Escitalopram was as eff
Slide 35: Global IP position
Global IP position Europe Bifeprunox: Compound patent in majority of countries to Feb. 2022 Escitalopram: Compound patent in majority of countries to May-June 2014. Process patent in majority of countries to June 2014 Memantine: Data exclusivity until 2012. Use patent in major countries to April 201
Slide 36: Worldwide pharmaceutical market 2006
Worldwide pharmaceutical market 2006 USD 605.1 billion (+7%) 8% (+5%) 17% (+7%) 3% (+3%) 5% (+6%) (N) CNS 5% (+4%) (C) Cardiovascular (A) Alimentary (J) Anti-Infectives 6% (+8%) 16% (+5%) (R) Respiratory (L) A+Immun (B) Blood 8% (+5%) (M) Muscolo-Skeletal (G) G.U.& Sex Hormones (D) Dermatologicals O
Slide 37: Worldwide CNS market 2006
Worldwide CNS market 2006 USD 100.7 billion (+7%) 5% (16%) 21% (+2%) 3% (+16%) N6A Antidepressants N5A Antipsychotics 3% (-4%) N3A Anti-Epileptics 3% (+12%) N2B Non-Narcotic Analgesics 3% (-5%) N2A Narcotic Analgesics 3% (+6%) N5B Hypnotics & Sedatives N2C Anti-Migraine Preps 5% (+19%) 17% (+11%) N5
Slide 38: Alzheimer's (N7D-2006) market
Alzheimer’s (N7D-2006) – USD 4.6 billion (+16%) Value Market Shares of N7D Europe M12 2006 Rest of world Rivastigmine USA M12 2006 15% North America Memantine 55% Galantamine Europe Donepezil 30% 0% 10% 20% 30% 40% 50% 60% Source: IMS Health, May 2007, retail Leading product Marketing Corporation Sa
Slide 39: Depression (N6A-2006) market
Depression (N6A-2006) – USD 20.3 billion (+2%) North Value Market shares of N6A America CITALOPRAM Rest of world 67% 11% FLUOXETINE PAROXETINE DULOXETINE Europe M12 2006 USA M12 2006 ESCITALOPRAM BUPROPION SERTRALINE Europe VENLAFAXINE 22% 0% 5% 10% 15% 20% 25% Source: IMS Health, May 2007, retail o
Slide 40: Anti-Parkinson's (N4A-2006) market
Anti-Parkinson’s (N4A - 2006) – USD 3.1 billion (+12%) Value Market Shares of N4A - Europe Europe Europe M12 2006 OTHERS 38% North NMDA ANTAGONISTS America MAOI 29% LEVODOPA DERIVATE DOPAMINE AGONISTS COMT INHIBITORS ANTICHOLINERGICS Rest of world 0% 10% 20% 30% 40% 50% 60% 33% Value Market shares o
Slide 41: Antipsychotics (N5A-2006) market
Antipsychotics (N5A-2006) – USD 18.1 billion (+11%) North Value Market Shares of N5A Europe M12 2006 America Aripiprazole USA M12 2006 65% Rest of world Risperidone 11% Olanzapine Amisulpride Clozapine Ziprasidone Europe Quetiapine 25% 0% 5% 10% 15% 20% 25% 30% 35% 40% Source: IMS Health, May 2007,
Slide 42: Hypnotics (N5B-2006) market
Hypnotics (N5B-2006) – USD 5.4 billion (+19%) North Value Market Shares of N5B America 67% Europe Q4 2006 USA Q4 2006 Zaleplon Europe Zopiclone 18% Zolpidem Rest of world 15% 0% 10% 20% 30% 40% 50% 60% 70% 80% Source: IMS Health, October 2007, retail Leading product Marketing Corporation Sales 2006
Slide 43: Alcohol (N7E) and Stroke Fibrinolytics (B1D) markets
Alcohol (N7E-2006) – USD 151 million (+20%) Europe 54% North America 28% Rest of world 18% Stroke, Fibrinolytics (B1D - 2006) – USD 675 million (+1%) Europe North 31% America 51% Rest of world 18% Page 43