Aspen Pharmacare Holdings Limited · JSE:APN
Aspen Pharmacare — Investor Day (November 2017)
121 slides from Aspen Pharmacare's investor day presentation, Nov 22, 2017
Slide 1: Investor Day
Investor Day 22 November 2017 For further information, please contact: Zihle Mgcokoca Investor Relations Manager [email protected]
Slide 2: Manufacturing Strategy within Group Operations: Site Capex Projects
MANUFACTURING STRATEGY WITHIN GROUP OPERATIONS SITE CAPEX PROJECTS Lorraine Hill, Group Operating Officer
Slide 3: Introduction
HOLDINGS Introduction
Slide 4: Overview
Overview 4 Aspen offers a differentiated model − Not a R & D company, not a generic company − De-risked – not boom and bust nor commodity Focus on technically complex products in specialist areas Operations key to overall delivery Transactions with big pharma transcend commercial aspects onl
Slide 5: Overview
Overview 5 Aspen operational credentials meet big pharma requirements for complex global transactions − Delivery of uninterrupted global supply − Technical competency − Manufacturing excellence − Strong corporate governance framework − Dedicated team of 350 – 400 people committed to process comple
Slide 6: Overview
Overview 6 Transactions commercial success is dependent on achieving a change in trajectory − Valuation upside realised by changes in sales and margin with lower cost of goods Volume growth, particularly in emerging markets Leverage brand equity with line extensions (development) Margins add
Slide 7: Overview
Overview 7 Relevance defined by − Expensive new medications − Increasing strain on governmental healthcare budgets Aspen model − Provides quality and affordable medicines − Fits with future healthcare needs
Slide 8: Aspen Notre Dame de Bondeville (NDB)
Aspen Notre Dame de Bondeville (NDB)
Slide 9: Aspen NDB - France
Aspen NDB - France 9 Demonstration of volume and technology benefits Year Sustainable Capacity Head-Count 2014 100M 837 2018 240M 614 2023 450M ~750 Large volume increases with a lower headcount
Slide 10: Aspen NDB - France
Aspen NDB - France 10 Site acquired from GSK in May 2014 Initial focus – disentanglement Required investment − IT − Replacement of GSK off site functions − Old and inefficient lines in need of replacement Manpower not optimised Expenses – high and fragmented No major drive on efficiency
Slide 11: Aspen NDB: Pre-filled Syringes 2014 - 2023
Aspen NDB: Pre-filled Syringes 2014 - 2023 11 B-Leave project − Headcount reduction − Savings plan implementation Exit and demolish block 2 − 3 low speed, low efficiency lines to one high speed line Inauguration and ramp up of “Stromboli” line Nadroparin API capacity increase Establish bio
Slide 12: Aspen NDB: Pre-filled Syringes 2014 - 2023
Aspen NDB: Pre-filled Syringes 2014 - 2023 12 New laboratory start up New workshop for certoparine Demolish old laboratory and block 2 Validation and supply of Mono-Embolex New, cost effective Arixtra device Additional products – Own products / CMO Another high speed PFS line installed
Slide 13: Aspen NDB: Pre-filled Syringes 2014 - 2023
Aspen NDB: Pre-filled Syringes 2014 - 2023 13 Continuous improvement programme - PFS Procurement and Production savings To deliver over next 3 years ~ €10M − New device and syringe – Mono-Embolex − Glass syringe savings − API transfer of certoparine to NDB − Fondaparinux supply chain optimisat
Slide 14: Aspen NDB - Anaesthetics
Aspen NDB - Anaesthetics 14 BFS (blow fill seal) amps and polybags 2018 – 2023 Addition of the Anaesthetics Like for like technologies together − Further benefits – skills and scale Commencing 2018 Construction of new building Qualification, installation, validation 2021 start commerci
Slide 15: Aspen NDB - Anaesthetics
Aspen NDB - Anaesthetics 15 BFS Additional heads < 100 Capacity – 80M Savings > 30% versus current CMO Reduction of costs allocated to anti-coagulants Leveraging capacity and synergies
Slide 16: Site transformation
Site transformation 16 900 800 700 600 500 400 300 200 100 - 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Total Head Count Total Capacity Capex intensive for now – €160M True demonstration of economies of scale − Lower cost of goods and increased volume − More volumes – even lower cost of g
Slide 17: Port Elizabeth
HOLDINGS Port Elizabeth | << Le tubal
Slide 18: Port Elizabeth
Port Elizabeth 18 Lennon Ltd” established in 1850 Proud heritage
Slide 19: Port Elizabeth
Port Elizabeth 19 1930 1967 1975 Through the ages
Slide 20: Port Elizabeth
Port Elizabeth 20 1998 2004 2010 A continuous transformation process
Slide 21: Port Elizabeth
Port Elizabeth 21 Future expansion QC Unit 3 Unit 2 GPU Unit 1 Unit 4 SVP2 SVP1 Ready for the future
Slide 22: Port Elizabeth
Port Elizabeth 22 In 2008 General Facility – 65 years old Manufactured a wide range of dosage forms − Liquids − solids − Semi-solids Employed approximately 750 people 2010 – site designated for orals and steriles only − Semi-solids and liquids to East London − Like for like technologies Mult
Slide 23: Port Elizabeth
Port Elizabeth 23 Port Elizabeth – cost efficient global site Focus on capability and capacity − Significant enhancement in steriles area Absorb anaesthetics − High potency capability − Capacity enhancement for oral solids − Leverages much of existing fixed cost base − Continuous improvement
Slide 24: Sterile capacity and capability
Sterile capacity and capability 24 Anaesthetic Transfer and Ramp Up − Market has significant global supply constraints Real opportunity when in stock Current Aspen sales impacted by constraints − Addition to Sterile site Significant capex project − Capacity to reach over 150M units between n
Slide 25: Oral solids capacity and capability
Oral solids capacity and capability 25 Investing in capability Completion of High Potency Unit − Containment − High potency / hormonal Adding to oral solid capacities − Coating, compression, packing − Blister packing alone almost doubling 65M units Niche and relevant
Slide 26: Aspen Bad Oldesloe
HOLDINGS Aspen Bad Oldesloe
Slide 27: Aspen Bad Oldesloe
Aspen Bad Oldesloe 27 Future global focus – semi-solids & liquids Versatile and niche High quality products Exceptional delivery record Speed to market Technical transfer record − Hormonal creams and tablets Proven track record of delivery − Confidence earned for delivery of anaestheti
Slide 28: Aspen Bad Oldesloe
Aspen Bad Oldesloe 28 Local Anaesthetic portfolio Benefits through economies of scale Creams, Gels and Liquids 28 M units Capex €14M COG’s reduction versus CMO of over 40% Leveraging Excellence
Slide 29: Conclusion
HoL DINGS Conclusion
Slide 30: Conclusion
Conclusion 30 We have demonstrated within operations − Manufacture is a strategic asset − We have made or are making significant investments Capex intensive in the short term Technologies, sustainable lower cost of goods Operational performance − Fundamental to our business performance − Str
Slide 31: Conclusion
Conclusion 31 Deliver on our commitment to quality, affordable medicines − Niche complex manufacture − Barriers to entry are high For our teams this sense of purpose and worth makes overcoming all the operational challenges worthwhile People Driven
Slide 32: Q&A
Q&A
Slide 33: The Role of Aspen Global
THE ROLE OF ASPEN GLOBAL Samer Kassem, CEO: Aspen Global Inc.
Slide 34: Humble beginnings
Humble beginnings 4 APPLE AMAZON HARLEY MATTEL
Slide 35: Who we are
35 WHO WE ARE WHAT WE DO COMPLEXITIES WE MANAGE
Slide 36: AGI at a glance
AGI at a glance 36 IP OWNER – TRADING HUB - MANAGE ASPEN’S GLOBAL BUSINESS – HOLDING COMPANY – FUNDER - LAUNCH PAD FOR NEW DEALS Company founded # Employees Revenue Headquarters 2008 220 €1.2bn Mauritius
Slide 37: Interesting facts about AGI
Interesting facts about AGI 37 DIVERSITY MAURITIAN ORGANISATION 24 NATIONALITIES & 75% MAURITIAN 23 LANGUAGES MALE /FEMALE RATIO BUSINESS 55% FEMALE CONTINUITY PLAN RECOVERY: 2 days
Slide 38: Meet our executive team
Meet our executive team 38 CEO SPE CFO COO HPM SAMER KASSEM PAULINE MACDONALD ISSAM SARKIS MICHAEL AINSLIE RAYYAN PEERUN Chief Executive Officer Strategic Projects Chief Financial Officer Chief Operating Officer Head of Project a Executive a a Management 9 years 8 years 8 years 5 years 8 years
Slide 39: Reporting hierarchy structure
Reporting hierarchy structure 39 Samer Kassem Strategy & CEO Commercial Performance Pauline Macdonald Issam Sarkis Michael Ainslie Rayyan Peerun Executive- Strategic Projects Chief Financial Officer Chief Operating Officer Head of Projects Finance & Accounting Human Resources Supply Chain Supply Cha
Slide 40: What we do
WHO WE ARE WHAT WE DO COMPLEXITIES WE MANAGE
Slide 41: AGI's Role
AGI’S Role 41 DEALS PROJECT MGT SUPPLY & PERFORMANCE QUALITY MGT MGT • Due Diligence • From deal to first supply • Managing sites (FDF, API • Deal financials • Negotiation • Transition plans and Packers) • Price approvals • Funding (supported by • Stakeholder coordination • Link between demand • Glo
Slide 42: Deals: AGI's journey
Deals: AGI’s journey 42 2008: 2012: 2014: 2016: ELIZ products GSK classic & OTC Florinef / Omcilon AZ Anaesthetics (1) brands GSK Anaesthetics 2009: 2013: 2015: 2017: Specialist global brands GSK thrombosis Mono-Embolex / AZ Anaesthetics (2) business HPC MSD business
Slide 43: Deals: AGI evolution
Deals: AGI evolution 43 220 4 000 3 500 156 146 3 000 129 2 500 115 90 2 000 3 800 65 1 500 2 350 2 520 43 2 250 1 000 25 1 659 1 692 1 307 1 500 756 70 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Headcount # of SKU’s
Slide 44: Deals: facts & figures
Deals: facts & figures 44 Closed 20 deals since inception Processed 8,500 orders last year, > 100 branded products amounting to 180 million packs of (Anaesth., Cardio, Onco, vital medicines CNS, OTC, nutrition, etc.) Supplied approx. Aspen manufacturing sites now 5,000 Trademarks, 3,800 500 million
Slide 45: Project management
Project management 45 AGI Manages 100+ projects simultaneously Main project types Distribution MA Holding Strategic Pack changes transfers changes launches API source FDF Site Supply Chain Others changes changes Projects
Slide 46: Supply chain management
Supply chain management 46 60 FG Sites Primary Wholesaler 4 Logistics service providers 3800 SKUs API Manufacturer 25 API Sites 55 SKUs Manufacturing Hospitals and Pharmacies Excipient Manufacturer Packaging Secondary Wholesaler Extent of MA holders Supply Chain responsibilities
Slide 47: Performance management
Performance management 47 DEALS PROJECT MGT SUPPLY & OVERALL QUALITY MGT BUSINESS • Financial aspects • Project status vs milestones • On Time In Full (OTIF) • Achievement of synergies • Trade routes • Transition stock control • Forecasting metrics • Global brand P&L • COGS approvals • Working capit
Slide 48: Complexities we manage
WHO WE ARE WHAT WE DO COMPLEXITIES WE MANAGE
Slide 49: Complexities we manage: MSD business
Complexities we manage 49 MSD business Background: Supply termination from main MSD manufacturer happened one year ahead of initial timeline 250 SKUs were affected Not all products were transferable to Aspen’s sites Stock build volumes were based on limited market intelligence Long Technic
Slide 50: AGI Trade Lanes
AGI Trade Lanes 50
Slide 51: Healthcare Care We Mandela Day
MANDELA DAY 101 000 beneficiaries 105 projects 37 countries 6 continents ~ (One patient's expression was priceless: With her face covered by a mask, her eyes showed a storm of happy feelings. That moment made the efforts ofthe day ‘more than worthwhile for the Aspen team. EXCELLENCE INNOVATION INTEG
Slide 52: Patient Focus
Patient Focus ass D oO i fas] oO rar non £ Oo torA) oO ~ & oo =e Ae) fe =
Slide 53: Q&A
Q&A
Slide 54: Accelerating Growth through Focus and Execution
Accelerating Growth through Focus and Execution Carnie van Der Linde: Group Commercial Head
Slide 55: Agenda
Agenda 55 1 Europe CIS Executive summary Europe overview Aspen Europe CIS 2 Spanish Latam Executive summary Spanish Latam overview Aspen Spanish Latam 3 Brazil Executive summary Aspen Brazil
Slide 56: Executive Summary – Europe CIS
1 Executive Summary – Europe CIS 56 Pharmaceutical sector is valued at €275bn and growing at 3.8% Territory Europe CIS operates across 44 countries overview Developed Europe CIS – no/low growth Developing Europe CIS - strong growth Thrombosis Aspen Anaesthetics portfolio Women’s Health
Slide 57: Europe CIS
Europe CIS 57 ICELAND FINLAND SWEDEN NORWAY RUSSIA ESTONIA UNITED LATVIA KINGDOM DENMARK LITHUANIA IRELAND NETHERLANDS BELARUS GERMANY POLAND UKRAINE CZECHREP LUXEMBOURG SLOVAKIA FRANCE AUSTRIA HUNGARY SWITZERLAND ROMANIA SLOVENIA SERBIA PORTUGAL LIECHTENSTEIN ITALY BULGARIA HERZEGOVINA MACEDONIA SP
Slide 58: Europe CIS overview
Europe CIS overview 58 Europe CIS pharma sector Aspen Europe Sales €275bn Sales €644mn Germany Germany 26% France France 74% Italy 18% 20% Italy 20% 23% Spain Russia 2% UK 3% Belgium 3% 3% MAT 3% MAT Russia 3% Aug ‘17 15% Netherlands Aug ‘17 4% 16% Turkey 7% Poland 5% 5% Poland 8% 12% UK 5% 9% 9% 7%
Slide 59: Aspen path from 2013 to 2017
Aspen path from 2013 to 2017 59 Focus on profitable growth & development Operate in flat to declining market with price pressure Volume growth opportunities through active promotion Growing volume in prioritised segments 2016-2017 Net Sales = €644m (85% Consignment & 15% Buy-Sell business) 5
Slide 60: Aspen Overview
Aspen Overview 60 Sales €479mn Sales €165mn Germany Russia France 16% 17% Poland 32% 26% Italy 6% Czech Aspen MAT Aspen26% 7% MAT Belgium Slovakia Developed 6% Aug ‘17 Developing Aug ‘17 Netherlands 74% Hungary 8% Europe 7% Europe UK Romania 18% 11% 12% 21% Rest Rest 13% Contribution to revenue Cont
Slide 61: Aspen Overview
Aspen Overview 61 Developed Europe Developing Europe Flat or declining market trends Volume-driven markets with low treatment rates High level of governmental price regulations Volume-driven growth more than margin driven Germany, France, UK, Ireland, Italy, Benelux, Nordic, Iberia, Austri
Slide 62: Thrombosis Strategy
Thrombosis Strategy 62 Establish Aspen as the leading company within Differentiate from competition Thrombosis field FRAXIPARINE/FRAXODI Clear segmentation and targeting to strengthen our communication Positioned as the brand of choice for deep vein thrombosis prophylaxis with the various stakeh
Slide 63: Anaesthetics Strategy
Anaesthetics Strategy 63 Establish Anaesthesia = Aspen Differentiate from competition Continue to execute a unique communication to stakeholders GENERAL ANAESTHESIA & ICU Build relationships with key medical anaesthesia and ICU societies ESA, Create new value proposition on patient safety leve
Slide 64: Focus Areas 2018-2019
Focus Areas 2018-2019 64 Portfolio integrating 1 Fully embed Anaesthetics portfolio opportunities Leverage synergies with existing portfolios Supply chain management 2 Stable & sustainable supply Improve product mix to drive margin growth Differentiation in Thrombosis 3 Profitable growth i
Slide 65: Executive Summary – Spanish Latam
2 Executive Summary – Spanish Latam 65 The Pharmaceutical sector is valued at $23.3bn USD and growing at 6.1% Territory Aspen is the 28th largest generic company with 1% share overview Territory is very fragmented: Abbott 4.4%, Sanofi 4.0%, Roemmers 3.1%, Pfizer 3% 27% of the retail market i
Slide 66: Spanish Latam
Spanish Latam 66 As per IMS, Aspen Spanish Latam was ranked 27 in 2017, a significant improvement from the 82 ranking in 2013 Source: IMS MAT Values usd Jul 17 W/O Arg & Ven In local currency
Slide 67: Spanish Latam overview
Spanish Latam overview 67 Spanish Latam pharma sector Aspen Sales €23bn Sales $197mn 26% 74% Mexico Mexico 15% 22% Agentina 33% Ecuador 7% MAT MAT Colombia 7% Jun ‘17 Colombia Jun ‘17 9% 52% Chile 10% Peru 17% Others 28% Others Source: IMS MAT Values usd Jun 17 (Mexico Walmart Group information is i
Slide 68: Aspen path from 2013 to 2017
Aspen path from 2013 to 2017 68 Focus is on organic growth Operate in a market with currency pressure in many countries Volume growth through maximising Pharma business Scaling up our Pharmaceutical suite - regional manufacturing to improve margins Continue with the creation of Aspen brand
Slide 69: Therapeutic focus
Therapeutic focus 69 Infant Nutritionals Commercial Pharma Alula transition will be in 2019 Develop Thrombosis in the region Build the baby base in country Develop Anaesthetics in the region Grow Premium segment Grow our share in Argentina, the 2nd largest market Entrance into the mid
Slide 70: Focus Areas 2018-2019
Focus Areas 2018-2019 70 Drive Pharma growth through selective partnering 1 and acquisitions Expand OTC portfolio 2 Umbrella Branding 3 Adult Nutrition entry and expansion Manufacturing efficiency and 4 supply chain management Expanding our Pharma manufacturing Talent Management 5 Deve
Slide 71: Executive Summary – Brazil
3 Executive Summary – Brazil 71 Pharmaceutical Sector is valued at $29bn and growing at 24.1% Brazil Growth driven by Brazilian generics companies overview Highly concentrated market (Distributors and Pharmacy Chains) Brazil is recovering from a 3 year recession Thrombosis Anaesthetics A
Slide 72: Focus Areas 2018-2019
Focus Areas 2018-2019 72 Portfolio integration and Review Explore the full Anaesthetics portfolio 1 Leverage synergies with organic portfolios Divest non core products Supply chain management 2 Stable & sustainable supply Improve product mix to drive margin growth Profitable growth in OTC
Slide 73: Q&A
Q&A
Slide 74: Aspen's Evolving Disclosure
ASPEN’ S EVOLVING DISCLOSURE Sean Capazorio, Group Financial Officer
Slide 75: Evolving Disclosure FY17
Evolving Disclosure FY 17 75 Segmental Reporting Constant Expenses by Exchange Rate Nature
Slide 76: Commercial Pharma - geographic split
Commercial Pharma - geographic split 76 FY 2000 FY 2013 FY 2017 Sales R1.0 billion Sales R18.6 billion Sales R31.4 billion South Africa South Africa Australia Australasia Japan Brazil Germany Latin America China Brazil SSA France Rest of Asia Italy Philippines United Kingdom South Africa only Japan
Slide 77: Commercial Pharma – therapeutic category split
Commercial Pharma – therapeutic category split 77 FY 2000 FY 2013 FY 2017 Sales R1.0 billion Sales R18.6 billion Sales R31.4 billion Anaesthetics Thrombosis High Potency & Cytotoxics Other Commercial Pharma Brands Other Commercial Pharma Brands Predominantly Other Commercial Pharma Brands with limit
Slide 78: Segmental Disclosure
Segmental Disclosure 78 Reportable segments have evolved following recent acquisitions: Pharmaceuticals Regional Nutritionals SSA International Asia Pacific Therapeutic Focused Brands Pharmaceutical Other Pharmaceuticals Anaesthetics Therapeutic Focused Brands Thrombosis High Potency & Cytotoxic Oth
Slide 79: Segmental Disclosure
Segmental Disclosure 79 REPORTABLE SEGMENTS – Improved contribution disclosure and a move away from regional profit analysis Sales Sales And Normalised Gross Profit (Pharma Sub Level Plus Nutritionals) EBITDA By Region Selling And Distribution Expenses Contribution (Pharma And Nutritionals) Further
Slide 80: Segmental Disclosure
Segmental Disclosure 80 Entity wide revenue disclosure expanded to incorporate new reportable segments and geographic footprint Emphasis on Emerging vs Developed market trends Developed Europe Europe CIS Developing Europe and CIS CIS Key Developing Poland Countries Czech Republic China Slovakia
Slide 81: Constant Exchange Rate reporting
Constant Exchange Rate reporting 81 26% Revenue Gross Profit Normalised EBITDA 28% 28% 36% 20% 20% 22% 27% 14% 18% 23% 20% 11% 8% 11% 5% 7% 9% 4% -11% -26% EUR ZAR AUD USD JPY CNY Other +16% +11% +13% 41 213 19 897 11 416 35 559 17 900 +16% 10 105 +18% +22% 739 1 808 421 R’million 17 161 9 684 33 75
Slide 82: Constant Exchange Rate reporting
Constant Exchange Rate reporting 82 Evolution to CER reporting assists management in understanding the underlying operational performance without the distortion of volatile currency shifts Aspen’s model estimates the source currencies constituting the group’s consolidated income statement It i
Slide 83: Constant Exchange Rate reporting
Constant Exchange Rate reporting 83 New segmental entity wide revenue report disclosed on a CER basis reflecting underlying in-country revenue growth trends Full illustrative CER reporting to NHEPS level Ability to measure group sensitivity to currency shifts utilising the disclosed top 10 cur
Slide 84: Expenses by nature
Expenses by nature 84 Selling and Other distribution Administrative operating Cost of sales expenses expenses expenses Total R ’billion R ’billion R ’billion R ’billion R ’billion 2017 Cost of material and production-related variances 14,7 - - - 14,7 Personnel costs and other staff-related costs 3,7
Slide 85: Expenses by nature
Expenses by nature 85 Expense disclosure evolved from typical accounting split, which led to confusion, to a business relevant format Further split between cost of sales, selling and distribution, admin and other expenses improves linkage to business performance CER effect by expense line not
Slide 86: Q&A
Q&A
Slide 87: Asia – A Focus Region for Aspen
ASIA – A FOCUS REGION FOR ASPEN Trevor Ziman, CEO: Asia Pacific
Slide 88: Agenda
Agenda 88 Australia vs Asia – Why now the focus on Asia Aspen set up in Asia – How does Aspen manage its operations in Asia China – a complex geography − The Industry in China − Aspen set-up − Portfolio performance − Contributing factors to performance − Path forward Infant milk - The arriva
Slide 89: Australia vs Asia - why the focus?
Australia vs Asia - why the focus? 89 2016 Population 2016 GDP 2016 Pharma Opportunity 4,50 217 25,6 USD’ trillion USD’ billion 0,02 0,9 13 Billion Asia Australia Asia Australia Asia Australia ATTRACTION TO ASIA MOTIVATED BY • Emerging middle class − many already loyal to Aspen’s acquired global off
Slide 90: Asia pharmaceutical size by geography
Asia pharmaceutical size by geography | significant & growing 90 250,0 201,1 207,4 205,8 216,7 200,0 KOREA KOREA KOREA KOREA 150,0 USD' bn JAPAN JAPAN JAPAN JAPAN 100,0 Aspen Focus 50,0 CHINA CHINA CHINA CHINA - 2013 2014 2015 2016 Bangladesh China Hong Kong India Indonesia Japan Korea Malaysia Paki
Slide 91: Aspen set up in Asia Pacific
Aspen set up in Asia Pacific 91 Criteria for setting up front-ended Aspen subsidiaries: Malaysia Taiwan China Critical mass (organic or acquired) Can Aspen’s detailing focus grow products more efficiently and Philippines Thailand quicker vs outsourcing Cost comparison: Aspen affiliates vs. dis
Slide 92: Aspen Asia
Aspen Asia 92 “What have we got so far?” Aspen Hong Kong management office (non trading) Asia Aspen Aspen Aspen Aspen Aspen Philippines Malaysia Taiwan Japan China Distributors Korea, 2011* 2012* 2013* 2015* 2016* Hong Kong, ~130 staff ~39 staff ~15 staff ~127 staff ~650 staff Indonesia, Thailand, V
Slide 93: Aspen China
Aspen China 93
Slide 94: Aspen China
Aspen China 94 “Climbing the Great Wall” “Why is it so challenging?” “What do we know about China?” 3,000,000 Doctors ^ 27,000 Hospitals 5 Tier 1 cities 30 Tier 2 cities China population aged over 65 (million) 155 148,96 5000+ Drug Manufacturers 13000 distributors 150 145 142,03 Factors that determi
Slide 95: What have we built to date?
“What have we built to date?” 95 Infrastructure 3 key offices in Beijing, Shanghai and Guangzhou − Set up in record time and fully functional All business licences in place - not an easy process in China State of the art Business Intelligence/SFE tools implemented − We can monitor the feet on
Slide 96: Headcount - built properly with plenty of room to expand
Headcount - “built properly with plenty of room to expand” 96 3 Offices Beijing, Shanghai,Guangzhou, 10 Districts Sales & Marketing Teams Anaesthetics (ANA) Thrombosis (THR) 650 Employees Anaesthetic ("ANA") team 351 Thrombosis ("THR") team 213 Commercial 21 Finance & Procurement 18 Medical 10 HR 11
Slide 97: Key products
Key products 97 Fit into 2 of the 4 Aspen Focus Therapeutic Areas Thrombosis Arixtra Fraxiparine $US 40mill+ Anaesthetics Diprivan Mivacron Naropin Nimbex $US 125mill+
Slide 98: The current portfolio landscape
The current portfolio landscape 98 THROMBOSIS ANAESTHESIA ~ 30’m RMB* ~ 2’bn RMB* ~ 7’m RMB* ~ 2’bn RMB* ~ 3’bn RMB* ~ 1’bn RMB* 100% Others 3% Xianju Others Aspen 11% 13% 90% Other MNC Zhaoke Guorui Others 24% Local 80% Dongying 11% 35% 24% 70% Libang Others 15% Qilu 60% 9% Aspen Aspen Lukang 50% 1
Slide 99: China is hospital driven with a strong bidding component
China is hospital driven with a “strong bidding” component 99 Aspen has 21 heads in Commercial dealing with tenders with capacity to take on more products Key facts on tenders: • Winning tender is a vital starting point • Winning tender is only an entrance – no volume guaranteed • Winner still has t
Slide 100: MAT Growth
Performance since acquisition of anaesthetics – “we’re seeing results” 100 Ex-Factory MAT Anaesthetics (Naropin & Diprivan) +14,0% +12,0% +10,0% Acquired MAT Growth +8,0% 1 Sept 2016 +6,0% +4,0% +2,0% Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Total Anaesthetics Pos
Slide 101: Monthly Units
Performance since acquisition of anti thrombotics – “will aim to do more of the same” 101 Ex-Factory Fraxiparine 350 000 300 000 250 000 Monthly Units 200 000 150 000 100 000 Acquired 1 Jan2017 50 000 Jan Feb Mar Apr May Jun 2016 2017 Positive early trend signs
Slide 102: Performance drivers
Performance drivers 102 Complete focus on Anaesthetics and Thrombosis products (including Aspen Group senior management) No other material product distractions and team fully motivated to increase sales and find new prescribers Recruited experienced and highly skilled people – prevents Aspen m
Slide 103: Looking forward
Looking forward 103 Establish and ingrain Aspen culture – New staff with different “inherited” cultures Existing global portfolio currently outsourced − Imuran, Ovestin and Leukeran − Moving in-house in late CY 2018 Trading Model – still trading through 3rd party importer − “GSP” licence under
Slide 104: Nutri China - new brand new can
Nutri China - “new brand new can” 104
Slide 105: Nutri China - ANZ sourced milk for the China consumer
Nutri China - “ANZ sourced milk for the China consumer” 105 China commercial opportunity for infant milks Asia Pacific Baby Food Market Largest global infant formula opportunity with strong growth trajectory − 17 million babies born a year (no 1 child policy) In October 2016, new regulation requ
Slide 106: Nutri China - we have a plan to succeed
Nutri China - “we have a plan to succeed…” 106 WE HAVE A KNOWLEDGEABLE LOCAL PARTNER “we bring” Chinese Partner “they bring” Access to multinational group resources and capabilities Experience in infant formula sales, marketing and operations Global pharma / nutritionals expertise, including R
Slide 107: Aspen Japan
Aspen Japan Japan - Population ages 65 and above (% of total) Population ages 85 and above (% of total) in Japan was reported at 28.34 % in 2015, according to the World Bank collection of development indicators, compiled from offcially recegnized sources. sonnet tl
Slide 108: Aspen Japan (AJKK) positioning
Aspen Japan (AJKK) positioning 108 Aspen Japan at end customer sales value (Yen) AJKK began business in July 2015, and since then has continued to gradually expand its business in a controlled manner 1 143 Licensed Products AJKK was ranked 112th in the Japan in terms of end customer sales at the
Slide 109: Sales force structure - enhancing our reach
Sales force structure - enhancing our reach 109
Slide 110: Japan's sales coverage increases through partnerships
Japan’s sales coverage increases through partnerships 110 “ Good brands open doors” Aspen Japan partnered with Kissei in December 2016 to further promote and increase coverage for Imuran in Japan Aspen Japan partnered with Medipal in March 2017 to utilize their 2,000 Assist Representatives (AR) to e
Slide 111: Key products & focus areas
Key products & focus areas - “work to be done on anaesthetics” 111 Share IMS Sales Growth vs Prior Product Name (INN) Therapeutic Area (Value) (M JPY) Competitors Year in Volume Imuran® (1 SKU) Immuno-suppressant 70% 2,247 1 0 (Azathioprine) Diprivan® (6 SKUs) Anaesthesia 54% 3,743 5 -2% (Propofol)
Slide 112: Aspen Japan's focus - a different approach
Aspen Japan’s focus - “a different approach” 112 Innovator Drug Long-Listed Long-Listed Products Products with without Generics Generics Standard Authorized Commodity AGX for Generics Generics Aspen Japan *Not for Aspen Japan Commodity Generics
Slide 113: Authorized generics - strategy to date
Authorized generics - strategy to date 113 We partner with multinational companies to launch authorised generics (AGX’s) Proven success with GSK Product Name (INN) Therapeutic Area Launch Date Generic Share Competitors Valaciclovir Hydrochloride Tablet: July 2016 18.5% (#1) 32 Anti-Viral (2 SKUs
Slide 114: Aspen Malaysia
Aspen Malaysia 114
Slide 115: Aspen Malaysia
Aspen Malaysia 115 Annual revenue is RM32.6mil (Ringgit) Aspen ranked 20 in Rx pharmaceutical sales in Malaysia Majority of sales from Aspen core global products - our teams are focused − Anti Thrombosis 28% of sales (Arixtra) − Anaesthesia 35% of sales (6 products) Focus drives organic grow
Slide 116: Aspen Philippines
Aspen Philippines 116
Slide 117: Five years of Aspen Philippines
Five years of Aspen Philippines 117 Set up Sept 2011 - started operations in Jan 2012 Team 1 • 35 med reps From headcount of 1 to now 130 • Women’s Health • Anaesthesia 75 reps, two teams, nationwide coverage From nowhere to now 29th among the Top 100 Team 2 Pharma Corporations (Ethical) • 4
Slide 118: Aspen Taiwan
Aspen Taiwan — = a nt =m 0 zone me wa me
Slide 119: Sales growth trend 2015 - 2018
Sales growth trend 2015 - 2018 119 “Launched Arixtra Sales starting to gain traction” Aspen Taiwan Sales (TW$) 450 Eltroxin 50mcg 400 386,1 Eltroxin 100mcg 350 Lanoxin 289,7 300 Imuran Trandate 250 242,8 Alkeran 200 150 Leukeran 100 Florinef 50 Deca-Durabolin 0 2015 2016 2017
Slide 120: Pearls don't lie on the seashore
120 “ Pearls don’t lie on the seashore. If you want one, you must dive for it -Chinese proverb ”
Slide 121: Thank you
Q aspen Te a Sa i Thank you
Aspen Pharmacare Holdings — Investor Day (November 2017) on 6ix