Novo Nordisk A/s Class B · OMXCOP:NOVO_B
Novo Nordisk A/s Class B — 9M 2010 Earnings Presentation
59 slides from Novo Nordisk A/s Class B's earnings presentation, November 2010
Slide 1: Investor presentation First nine months of 2010
Investor presentation Investor presentation First nine months of 2010
Slide 2: Forward-looking statements
Investor presentation First nine months of 2010 Slide no 2 Forward-looking statements Novo Nordisk’s reports filed with or furnished to the US Securities and Exchange Commission (SEC), including the company’s Annual Report 2009 and Form 20-F, both filed with the SEC in February 2010 as well as this
Slide 3: Content
Investor presentation First nine months of 2010 Slide no 3 Content Highlights and key events Sales update R&D update Financials and outlook
Slide 4: Highlights and key events
Investor presentation First nine months of 2010 Slide no 4 Highlights and key events Market development • Modern insulins and Victoza® drive robust sales growth of 17% (12% in local currencies) • North America and International Operations account for more than 80% of sales growth • GLP-1 market expa
Slide 5: Key products continue to drive growth
Investor presentation First nine months of 2010 Slide no 5 Key products continue to drive growth – first nine months of 2010 Sales as reported Growth analysis Other Local currencies Growth Share of Norditropin ® +6% growth 4% +10% 8% Diabetes care Modern insulins 18% 61% NovoSeven® +20% Human insuli
Slide 6: North America drives sales growth
Investor presentation First nine months of 2010 Slide no 6 North America drives sales growth – first nine months of 2010 Sales as reported Growth analysis Japan & Korea +13% North America Local currencies Growth Share of +26% growth International 9% Operations North America 21% 60% +23% Europe 5% 13
Slide 7: Sustaining leadership position in an expanding insulin market
Investor presentation First nine months of 2010 Slide no 7 Sustaining leadership position in an expanding insulin market Global insulin market growth Global insulin market shares Novo Nordisk Sanofi-Aventis Eli Lilly Volume: 7.1% 70% DKK: 14.3% 60% GR 51% CA 50% 40% 30% 23% DKK 76.2 DKK 39.1 20% 22%
Slide 8: Continued conversion to modern insulins drives value creation in the insulin market
Investor presentation First nine months of 2010 Slide no 8 Continued conversion to modern insulins drives value creation in the insulin market Modern insulin penetration Modern insulin market shares Novo Nordisk Sanofi-Aventis Eli Lilly 70% 60% 62% 50% 46% 37% Modern insulin 40% 34% 30% 20% 19% Huma
Slide 9: Encouraging US performance of Victoza
Investor presentation First nine months of 2010 Slide no 9 Encouraging US performance of Victoza® Victoza® is gradually expanding Previous therapy regimens for new the US GLP-1 market Victoza® patients (% of patients) GLP-1 % of diabetes value market (right axis) Share of TRx Retail Value 60 5% 51%
Slide 10: Victoza continues to expand the European GLP-1 market
Investor presentation First nine months of 2010 Slide no 10 Victoza® continues to expand the European GLP-1 market Development in key European GLP-1 markets following Victoza® launch Germany UK France 7% Market value*: 7% Market value*: 7% Market value*: DKK 10 billion DKK 5 billion DKK 6 billion Di
Slide 11: New phase 3 data show DegludecPlus to have multiple benefits compared to NovoMix
Investor presentation First nine months of 2010 Slide no 11 New phase 3 data show DegludecPlus to have multiple benefits compared to NovoMix® in type 2 diabetes Trial design: • Randomised, controlled, open label, treat-to-target trial • People with type 2 diabetes with or without OADs randomised to
Slide 12: New phase 3 data show Degludec has the potential to offer dosing flexibility
Investor presentation First nine months of 2010 Slide no 12 New phase 3 data show Degludec has the potential to offer dosing flexibility Trial design: • Randomised, controlled, open label, treat-to-target trial • People with type 2 diabetes with or without OADs randomised to 26 weeks of treatment wi
Slide 13: First phase 3 data for liraglutide in obesity show 6 kg weight loss
Investor presentation First nine months of 2010 Slide no 13 First phase 3 data for liraglutide in obesity show 6 kg weight loss after 56 weeks treatment Trial design: • Randomised, double-blind, placebo controlled trial • Obese, non-diabetic participants, having lost ≥5% of body weight during a 4-12
Slide 14: Ultra long-acting recombinant Factor IX phase 1 trial shows FIX activity for several weeks
Investor presentation First nine months of 2010 Slide no 14 Ultra long-acting recombinant Factor IX phase 1 trial shows FIX activity for several weeks Trial design: • A multi-centre, multi-national, open-label, dose escalation trial evaluating safety and pharmacokinetics of ascending intravenous dos
Slide 15: Financial results
Investor presentation First nine months of 2010 Slide no 15 Financial results DKK million 9M 2010 9M 2009 change Sales 44,652 38,016 17% Gross profit 36,057 30,213 19% Gross margin 80.8% 79.5% Sales and distribution costs 12,921 11,183 16% Percent of sales 28.9% 29.4% Research and development costs
Slide 16: US Dollar close to 2009 average
Investor presentation First nine months of 2010 Slide no 16 US Dollar close to 2009 average 650 Spot rates Quarterly average Annual average Annual impact on operating profit of a 5% movement in USD/DKK currency (DKK million) 2010 600 USD 620 550 JPY 155 CNY 120 500 GBP 85 CAD 45 450 Q108 Q208 Q308 Q
Slide 17: Financial guidance for 2010 and preliminary plans for 2011
Investor presentation First nine months of 2010 Slide no 17 Financial guidance for 2010 and preliminary plans for 2011 Key currency rates • Sales growth expectations: DKK 2009 2010 Current per 100 average average* rate* • Now in the range of 11-12% in local currencies USD 536 565 535 • Now around 5
Slide 18: Total cash return to shareholders
Investor presentation First nine months of 2010 Slide no 18 Total cash return to shareholders - Share repurchase programme expanded by DKK 1 billion Dividend and payout ratio Annual share repurchases Dividend Payout ratio DKK billion DKK billion for prior year 5 Dividend paid 45% 10 9.5 4.4 Payout r
Slide 19: Closing remarks
Investor presentation First nine months of 2010 Slide no 19 Closing remarks Solid market performance Promising pipeline • 10% annual diabetes market growth • GLP-1 portfolio offers opportunity to driven by diabetes prevalence expand within early stage type 2 diabetes and establish presence • 51% ins
Slide 20: Investor information
Investor presentation First nine months of 2010 Slide no 20 Investor information Share information Investor Relations contacts Novo Nordisk’s B shares are listed on the Novo Nordisk A/S stock exchange in Copenhagen. Its ADRs are Investor Relations Novo Allé, DK-2880 Bagsværd listed on the New York S
Slide 21: Appendix
Investor presentation First nine months of 2010 Slide no 21 Appendix 1. Strategy 2. Financials 3. R&D 4. Detailed market shares
Slide 22: Appendix 1: Strategy
Investor presentation First nine months of 2010 Slide no 22 Appendix 1: Strategy
Slide 23: Sustainability of protein based franchises
Investor presentation First nine months of 2010 Slide no 23 Sustainability of protein based franchises Share of market Animal Human Modern New generation 1st generation 2nd generation 3rd generation • Degludec Insulin • NovoMix® • NovoRapid® • • DegludecPlus NN1218 • Levemir® • New concepts tim e Sh
Slide 24: Novo Nordisk's corporate strategy
Investor presentation First nine months of 2010 Slide no 24 Novo Nordisk’s corporate strategy Indications Compounds/Capabilities Strategic focus Insulin • Diabetes Expand leadership Expand leadership GLP-1 Drug delivery and protein expertise Global commercial infrastructure GLP-1 • Obesity/pre-diabe
Slide 25: Insulin leadership position in all regions
Investor presentation First nine months of 2010 Slide no 25 Insulin leadership position in all regions Global diabetes pandemic driven by International Operations North America Europe Market share 43% Market share 54% People with diabetes: People with diabetes: 2010: 30 mill. 2010: 35 mill. 2030: 41
Slide 26: GLP-1 penetrating the diabetes care market
Investor presentation First nine months of 2010 Slide no 26 GLP-1 penetrating the diabetes care market World DKK MAT market billion growth OAD 81 12% OAD Insulin Insulin 76 14% GLP-1 5 17% GLP-1 Note: Absolute data represent MAT June 2010 and growth data represent MAT June 2010 over MAT June 2009. S
Slide 27: There is a need for better treatment options to bring blood glucose levels in control
Investor presentation First nine months of 2010 Slide no 27 There is a need for better treatment options to bring blood glucose levels in control Major diabetic complications Diabetes control 100% HbA1c > 7% 56% 44% HbA1c < 7% Prevalence Direct costs related to T2DM 7% Antidiabetic drugs Retinopathy
Slide 28: Diabetes deteriorates the insulin response to changing blood glucose levels
Investor presentation First nine months of 2010 Slide no 28 Diabetes deteriorates the insulin response to changing blood glucose levels 24 hour insulin secretion in type 2 Post prandial insulin response in type 2 diabetics and healthy individuals diabetics and healthy individuals Healthy individual
Slide 29: Appendix 2: Financials
Investor presentation First nine months of 2010 Slide no 29 Appendix 2: Financials
Slide 30: Long term financial targets: Operating profit growth and operating margin
Investor presentation First nine months of 2010 Slide no 30 Long term financial targets: Operating profit growth and operating margin Operating profit growth Operating margin Current long term financial target Current long term financial target 25% 35% 30% 20% 25% 15% 20% 15% 10% 15.9 12.7 12.6 23.7
Slide 31: Long term financial targets: Return on invested capital and cash to earnings
Investor presentation First nine months of 2010 Slide no 31 Long term financial targets: Return on invested capital and cash to earnings Cash to earnings Return on invested capital (three years’ average) Current long term financial target Current long term financial target 60% 120% 50% 100% 40% 80%
Slide 32: Solid NovoSeven sales growth
Investor presentation First nine months of 2010 Slide no 32 Solid NovoSeven® sales growth Reported NovoSeven® sales Key observations • Sales growth YTD in 2010 of 13% as 2.500 reported and 9% in local currencies 2.000 % • Growth driven by North America AG R: 8 C • The sales growth for NovoSeven® DKK
Slide 33: Solid Norditropin sales growth
Investor presentation First nine months of 2010 Slide no 33 Solid Norditropin® sales growth Reported Norditropin® sales Key observations 1.400 • Sales growth YTD in 2010 of 10% as R : 12% reported and 6% in local currencies CAG 1.200 • Growth is driven by International 1.000 Operations and Japan DKK
Slide 34: Solid gross margin development key driver for financial achievements since 2005
Investor presentation First nine months of 2010 Slide no 34 Solid gross margin development key driver for financial achievements since 2005 Gross margin improvement Key observations 82% Annual average • Gross margin improvement of 130 81.2 basis points compared to first nine 80% 79.6 months of 2009
Slide 35: Appendix 3: R&D
Investor presentation First nine months of 2010 Slide no 35 Appendix 3: R&D
Slide 36: R&D pipeline: Diabetes and obesity
Investor presentation First nine months of 2010 Slide no 36 R&D pipeline: Diabetes and obesity Compound Type Indication Status (phase) 1 2 3 Filed Appr. Degludec Ultra LA basal insulin Type 1+2 DegludecPlus Ultra LA basal insulin with a bolus boost Type 1+2 Semaglutide Once-weekly GLP-1 analogue Typ
Slide 37: R&D pipeline: Haemostasis
Investor presentation First nine months of 2010 Slide no 37 R&D pipeline: Haemostasis Compound Type Indication Status (phase) 1 2 3 Filed Appr. NN1841 rFXIII Congenital FXIII deficiency NN7008 rFVIII Haemophilia A NN1731 Ultra FA rFVIIa analogue Haemophilia w. inhibitors NN7128 LA rFVIIa derivative
Slide 38: R&D pipeline: Inflammation
Investor presentation First nine months of 2010 Slide no 38 R&D pipeline: Inflammation Compound Type Indication Status (phase) 1 2a 2b 3 Filed Appr. Anti-NKG2D Monoclonal antibody RA Anti-IL-20 Monoclonal antibody PSA / RA Anti-C5aR Monoclonal antibody RA Anti-IL-21 Monoclonal antibody RA Note: PSA:
Slide 39: Protraction mechanism for Degludec
Investor presentation First nine months of 2010 Slide no 39 Protraction mechanism for Degludec Multi-hexamers Subcutaneous tissue Monomers Capillary membrane Insulin degludec in blood Albumin binding Capillary blood Cell Membrane Insulin Receptors
Slide 40: Metabolic action profiles of Degludec and DegludecPlus
Investor presentation First nine months of 2010 Slide no 40 Metabolic action profiles of Degludec and DegludecPlus Degludec steady state profile DegludecPlus single dose profile 3 10 People with type 1 diabetes (n=12) People with type 1 diabetes (n=12) 0.4 U/kg once daily for 6 days Single d
Slide 41: Degludec phase 3 data in type 2 diabetics
Investor presentation First nine months of 2010 Slide no 41 Degludec phase 2 data in type 1 diabetics All confirmed hypoglycaemia Confirmed nocturnal hypoglycaemia Insulin Degludec Insulin Glargine Insulin Degludec Insulin Glargine 1200 200 Estimated Relative Rate: 0.72 [0.52; 1.00] 1000 150 Number
Slide 42: Degludec phase 2 data in type 2 diabetics
Investor presentation First nine months of 2010 Slide no 42 Degludec phase 2 data in type 2 diabetics Mean insulin dose at week 16 and Similar development in HbA1C relative rate of hypoglycaemia Degludec OD Degludec 3TW Glargine OD Degludec Degludec Glargine OD 3TW OD 9.0 Weekly 3.1 3.4 3.3 8.5 insu
Slide 43: DegludecPlus phase 2 data in type 2 diabetics
Investor presentation First nine months of 2010 Slide no 43 DegludecPlus phase 2 data in type 2 diabetics Self measured plasma glucose at week 16 Mean insulin dose DegludecPlus Glargine DegludecPlus Glargine 280 0.5 29 30 2h PG increment (mg/dl) 0.45 U/kg Mean insulin dose (U/kg) 20 0.4 240 SMPG (mg
Slide 44: Recruitment now completed for the BEGIN and BOOST phase 3a programmes
Investor presentation First nine months of 2010 Slide no 44 Recruitment now completed for the BEGINTM and BOOSTTM phase 3a programmes Estimated timeline for patient treatment for clinical programme NN1250-3579: 12 mth vs. IGlar, T2 (N=984) NN1250-3582: 12 mth vs. IGlar, T2 (N=984) NN1250-3583 : 12 m
Slide 45: NN8022: Sustained weight loss and acceptable tolerability with liraglutide
Investor presentation First nine months of 2010 Slide no 45 NN8022: Sustained Weight Loss and acceptable tolerability with liraglutide within obese adults Weight change from screening for completers over 2 years Key observations after 104 weeks Placebo • Liraglutide is effective for weight loss for
Slide 46: NN1731: Attractive profile of the next generation factor seven
Investor presentation First nine months of 2010 Slide no 46 NN1731: Attractive profile of the next generation factor seven, rFVIIa analogue Velocity (mm*100/sec) 20 Severe haemophilia A + rFVIIa 2 µg/mL + NN1731 2 µg/mL • NN1731 has been found to induce a Healthy male 15 faster rate of thrombin form
Slide 47: NN7008: Comparable pharmacokinetic profile of NN7008 (N8) and Advate
Investor presentation First nine months of 2010 Slide no 47 NN7008: Comparable pharmacokinetic profile of NN7008 (N8) and Advate Mean plasma concentration over time • NN7008 (N8) is a third-generation, 1.3 serum-free, B domain truncated N8 recombinant factor VIII product developed for treatment for
Slide 48: NN7128: Promising profile for preventive treatment
Investor presentation First nine months of 2010 Slide no 48 NN7128: Promising profile for preventive treatment Product profile Project characteristics and status 12.5 μ g/kg NN7128 25 μ g/kg NN7128 50 μ g/kg NN7128 Characteristics: 75 μ g/kg NN7128 T½ ~15 hours 100 μ g/kg NN7128 • Prolonged half-lif
Slide 49: Appendix 4: Detailed market share slides
Investor presentation First nine months of 2010 Slide no 49 Appendix 4: Detailed market share slides
Slide 50: Proteins drive value growth in the global diabetes care market
Investor presentation First nine months of 2010 Slide no 50 Proteins drive value growth in the global diabetes care market Global diabetes care market Global diabetes care by treatment class value market share OAD Insulin GLP-1 45 25% 23% 40 Total market: CAGR 12% Quarterly sales (bDKK) 35 20% 30 15
Slide 51: Global insulin volume growth above 5%
Investor presentation First nine months of 2010 Slide no 51 Global insulin volume growth above 5% Regional volume shares Regional insulin volume growth of insulin market IO North America World IO North America Europe Japan & Korea Europe Japan & Korea 25% 100% 19% 20% 80% 4% 15% 60% 41% 10% 40% 5% 2
Slide 52: Stable market shares across the three insulin segments
Investor presentation First nine months of 2010 Slide no 52 Stable market shares across the three insulin segments Global insulin market by Novo Nordisk market share segments by segment Fast acting Premix Long acting tMU 100 100% CAGR volume: 6.7% CAGR value*: 15.1% 80 80% 34% 67% 60 Fast acting 60%
Slide 53: Still a significant potential for Novo Nordisk on the US modern insulin market
Investor presentation First nine months of 2010 Slide no 53 Still a significant potential for Novo Nordisk on the US modern insulin market US insulin market by segments US modern insulin market shares Modern insulin penetration Device penetration Novo Nordisk Sanofi-Aventis Eli Lilly tMU Penetration
Slide 54: Maintaining the solid leadership position on the European modern insulin market
Investor presentation First nine months of 2010 Slide no 54 Maintaining the solid leadership position on the European modern insulin market EU insulin market by segments EU modern insulin market shares Modern insulin penetration Device penetration Novo Nordisk Sanofi-Aventis Eli Lilly tMU Penetratio
Slide 55: Stable leadership position on the rapidly growing Chinese insulin market
Investor presentation First nine months of 2010 Slide no 55 Stable leadership position on the rapidly growing Chinese insulin market China insulin market by segments China insulin market shares Modern insulin penetration Device penetration Novo Nordisk Sanofi-Aventis Eli Lilly tMU Penetration Shangh
Slide 56: Sustained leadership position in Japan
Investor presentation First nine months of 2010 Slide no 56 Sustained leadership position in Japan Japan insulin market by segments Japan modern insulin market shares Modern insulin penetration Device penetration Novo Nordisk Sanofi-Aventis Eli Lilly tMU Penetration 4 100% 70% CAGR volume: 4.9% CAGR
Slide 57: US modern insulin conversion and product performance
Investor presentation First nine months of 2010 Slide no 57 US modern insulin conversion and product performance Share of short-acting segment Share of pre-mixed segment Share of long-acting segment Share of market converted: 76% Share of market converted: 43% Share of market converted: 79% 50% 50%
Slide 58: European modern insulin conversion and product performance
Investor presentation First nine months of 2010 Slide no 58 European modern insulin conversion and product performance Share of short-acting segment Share of pre-mixed segment Share of long-acting segment Share of market converted: 68% Share of market converted: 55% Share of market converted: 68% 50
Slide 59: Japanese modern insulin conversion and product performance
Investor presentation First nine months of 2010 Slide no 59 Japanese modern insulin conversion and product performance Share of short-acting segment Share of pre-mixed segment Share of long-acting segment Share of market converted: 77% Share of market converted: 61% Share of market converted: 77% 70