Slide 1: 2Q and Half Year Results 2010
2Q and Half Year Results 2010 \ eoouazeusy
Slide 2: Cautionary statement regarding forward-looking statements
Cautionary statement regarding forward-looking statements In order, among other things, to utilise the ‘safe harbour’ provisions of the US Private Securities Litigation Reform Act 1995, we are providing the following cautionary statement: This presentation contains certain forward-looking statements
Slide 3: 2Q and Half Year Results 2010 - David Brennan, CEO
2Q and Half Year Results 2010 David Brennan, CEO
Slide 4: Key Developments 1H 2010
Key Developments 1H 2010 • Brilinta US FDA Advisory Committee • US Court upholds US Crestor patent • Progress on R&D change programme 4 4
Slide 5: Senior leadership appointments in R&D
Senior leadership appointments in R&D Martin Mackay President, Research & Development Anders Ekblom Mene Pangalos EVP, Global Medicines Development EVP, Innovative Medicines 5 5
Slide 6: Key Developments 1H 2010
Key Developments 1H 2010 • Brilinta US FDA Advisory Committee • US Court upholds US Crestor patent • Progress on R&D change programme • Emerging Markets opportunity 6 6
Slide 7: Emerging markets forecast to contribute ~70% of pharma growth in next 5 years
Emerging markets are forecast to contribute ~70% of pharma growth in the next 5 years Worldwide pharmaceutical sales $130bn $955bn Emerging Markets1 70% $55bn Established Markets 30% $765bn 2009E 2014E Emerging markets projected to grow at a 12% CAGR from 2009-2014 7 1 Emerging markets are all marke
Slide 8: AstraZeneca revenue 1H 2010
AstraZeneca revenue 1H 2010 $357m Emerging Markets 60% $244m Established Markets 40% 1H 2009 1H 2010 8 Revenue growth on a CER basis
Slide 9: Key Developments 1H 2010
Key Developments 1H 2010 • Brilinta US FDA Advisory Committee • US Court upholds US Crestor patent • Progress on R&D change programme • Emerging Markets opportunity • Healthcare reform in US and Europe • Mid-term planning assumptions for revenue, Pre-R&D margins and cash generation & investment (201
Slide 10: Headline results 1H 2010
Headline results 1H 2010 2010 2009 Actual CER $m $m growth growth Sales 16,754 15,659 +7% +4% Core Operating Profit 7,507 6,968 +8% +5% Core EPS $3.82 $ 3.22 +19% +16% Restructuring ($0.30) ($0.13) MedImmune/Merck amortisation ($0.14) ($0.13) Legal provisions ($0.01) ($0.30) Reported EPS $3.37 $ 2.6
Slide 11: Headline results 1H 2010
Headline results 1H 2010 2010 2009 Actual CER $m $m growth growth Sales 16,754 15,659 +7% +4% Core Operating Profit 7,507 6,968 +8% +5% Core EPS $3.82 $ 3.22 +19% +16% Reported EPS $3.37 $ 2.66 +27% +23% Interim Dividend $0.70 $ 0.59 11 11
Slide 12: 2Q and Half Year Results 2010 - Simon Lowth, CFO
2Q and Half Year Results 2010 Simon Lowth, Chief Financial Officer
Slide 13: Agenda
Agenda • 2Q 2010 headline results • Restructuring • Cash flow and balance sheet • Shareholder return programme • Guidance update for FY 2010 13 13
Slide 14: Headline results 2Q 2010
Headline results 2Q 2010 2010 2009 Actual CER $m $m growth growth Revenue 8,178 7,958 +3% +1% Core Operating Profit 3,650 3,606 +1% - Core EPS $1.79 $ 1.64 +9% +9% Restructuring ($0.25) ($0.10) MedImmune/Merck amortisation ($0.07) ($0.06) Legal provisions ($0.01) ($0.30) Reported EPS $1.46 $1.18 +24
Slide 15: Regional revenue performance 2Q 2010
Regional revenue performance 2Q 2010 2010 CER $m growth Total Revenue 8,178 +1% US 3,396 -4% Western Europe 2,213 +1% Established ROW 1,277 +4% Emerging Markets 1,292 +16% 15 15
Slide 16: Crestor
Crestor 2Q10 Sales: $1,430m +23% US EM ROW $155m +28% • US TRx +12% EST ROW $320m +20% – 4 times statin market • US TRx share 11.8% in June W. EUR $276m +22% • Dynamic share >16% – Second only to Simvastatin US ROW $679m +24% • ROW sales $751m +22% • Volume growth 3 times statin market 2Q 09 2Q 10 U
Slide 17: Seroquel
Seroquel 2Q10 Sales: $1,352m +8% • Seroquel IR: $1,049m -5% EM ROW $90m +17% EST ROW • Seroquel XR: $303m +92% $78m +27% W. EUR US $219m -2% • TRx +70 basis points/market +120 bps • Market leading TRx share 31%, -36 bps • Seroquel XR now 15% US $965m +8% of franchise TRx’s ROW • Sales $387m +6% • Se
Slide 18: Symbicort
Symbicort 2Q10 Sales: $664m +20% US • TRx +57% EM ROW • NRx share 18.8% $88m +18% EST ROW – Up ~5 pts vs June 09 $60m +38% • New Start share 27% W. EUR $335m +3% ROW • Sales $483m +9% • Good launch in Japan US $181m +63% 2Q 09 2Q 10 US W EUR EST ROW EM ROW 18 18
Slide 19: Nexium
Nexium 2Q10 Sales: $1,257m 0% US • Retail volume -5% EM ROW $152m +18% • Steady share of Dispensed Units EST ROW $111m +2% – -6 bps vs Dec 2009 W. EUR $299m 0% • Supported by new promotional channels – Customer service associates – Inside telephone sales US $695m -4% – Digital • Avg realised prices
Slide 20: Arimidex
Arimidex 2Q10 Sales: $439m -10% US • Multiple generics approved following 27 June patent expiry EM ROW • Q2 includes provision against $38m -3% EST ROW pipeline inventory $72m 0% W. EUR ROW $144m -5% • Sales extensions on completed Paediatric Investigation Plan (PIP) US $185m -17% – Extends exclusiv
Slide 21: Core margin: 2Q 2010
Core margin: 2Q 2010 CER Delta vs $m growth % sales PY CER Core Gross Margin 6,789 +2% 83.0 +80 bps Distribution (88) +26% 1.1 -20 bps Core SG&A (2,271) +1% 27.8 - Core Other Income 186 -47% 2.3 -210 bps Core Pre-R&D Profit 4,616 -2% 56.4 -150 bps Core R&D (966) -9% 11.8 +120 bps Core Operating Prof
Slide 22: Restructuring programme 2010-2014
Restructuring programme 2010-2014 Total Programme Cost 2Q 2010 1H 2010 $m $m $m Global Supply Chain (340) (63) (91) SG&A (600) (53) (102) R&D (1,060) (354) (372) Total (2,000) (470) (565) Annual Benefits 2014 $m Total 1,900 22 22
Slide 23: Cash generation: 1H 2010
Cash generation: 1H 2010 2010 2009 $m $m Opening net cash/(debt) 535 (7,174) EBITDA* 7,509 7,293 Movement in working capital* (675) (172) Tax & interest paid* (1,235) (1,614) Other non-cash movements 32 (173) 5,631 5,334 Legal/Tax settlements* (864) - Net cash from operating activities 4,767 5,334 *
Slide 24: Cash generation: 1H 2010
Cash generation: 1H 2010 2010 2009 $m $m Opening net cash/(debt) 535 (7,174) Net cash from operating activities 4,767 5,334 Merck (647) - Other capital expenditure (948) (507) Abraxane disposal - 269 Dividends/Net share buy-back (2,883) (2,084) Other movements 79 (4) Closing net cash/(debt) 903 (4,1
Slide 25: Shareholder returns
Shareholder returns • First interim dividend $0.70 - Aim to rebalance first interim dividend at around one third of prior year - Full year 2009 dividend $2.30 • Share repurchases - Initial target: net $1 billion in 2010 - YTD $516 million - New Target: net $2 billion in 2010 25 25
Slide 26: Guidance for 2010 (Core basis)
Guidance for 2010 (Core basis) Revenue Low single-digit decline at CER Gross Margin around the Q1 run rate of 81% Core Pre-R&D Margin Near top of mid-term planning range Net Finance Expense ~$550m Other Operating Income < FY2009 Tax Rate ~27% Core EPS Range $6.35 to $6.65 26 26
Slide 27: Development Update
Development Update Anders Ekblom, Executive Vice President Global Medicines Development
Slide 28: Agenda
Agenda • Review of 1H 2010 • Key late stage projects • 2H 2010 news flow 28 28
Slide 29: Continued success in building global brands…
Continued success in building global brands… New product approved – Vimovo Advisory Committee recommended Brilinta US for approval in ACS 29 29
Slide 30: Brilinta / Brilique for ACS Positive FDA Advisory Committee
Brilinta / Brilique for ACS Positive FDA Advisory Committee • Mortality rates remain high with currently available treatment options for acute coronary syndromes (ACS)1 • Registry data indicates that up to 15% of patients die within the 1st year after their acute coronary event with current treatmen
Slide 31: Continued success in building global brands…
Continued success in building global brands… New product approved – Vimovo Advisory Committee recommended Brilinta US for approval in ACS New indication for Crestor based on JUPITER New indication for Crestor based on JUPITER EU New indication for Seroquel XR as add-on in MDD (CHMP) New higher dose
Slide 32: …tempered by some disappointments
…tempered by some disappointments Phase 3 results in recurrent Glioblastoma and Colorectal Recentin cancer not supportive of regulatory filing Motavizumab FDA Advisory committee not supportive of approval Complete response letter from FDA. Certriad Ongoing discussions to clarify requirements Complet
Slide 33: Dapagliflozin: a new approach to type 2 diabetes
Dapagliflozin: a new approach to type 2 diabetes Attribute Dapagliflozin1-5 Mechanism of action • Potential first-in-class SGLT2 inhibitor Dosing • Once daily oral tablet Glycaemic efficacy • Significant reductions in HbA1c and fasting plasma glucose • Decreased need for daily insulin dose in insuli
Slide 34: Olaparib: a potential new therapy for breast and ovarian cancers
Olaparib: a potential new therapy for breast and ovarian cancers Positive Proof of Concept in Breast and Ovarian cancer 100 80 Best change from baseline (%) 60 40 Increasing tumour shrinkage Phase 3 trial in BRCA Breast gBRCA Breast Cancer 20 0 Cancer planned with a new Olaparib –20 tablet formulati
Slide 35: Zibotentan: a potential new therapy in Castration Resistant Prostate Cancer
Zibotentan: a potential new therapy in Castration Resistant Prostate Cancer 517,000 ~ 316,000 ~ 165,000 men will develop new cases of will develop CRPC1 metastatic disease1 Prostate cancer 48% asymp. 52% symp2 each year1 Zibotentan improves Overall Survival in Phase 2 study in metastatic CRPC 1.0 0.
Slide 36: Zibotentan ENTHUSE Phase 3 programme covers the full spectrum of CRPC
Zibotentan ENTHUSE Phase 3 programme covers the full spectrum of CRPC Non Metastatic (M0) Metastatic (M1) Metastatic (M1c) Asymptomatic or Asymptomatic or Symptomatic mildly symptomatic mildly symptomatic for pain for pain 152,000 Patients per year2 79,500 Patients per year2 85,500 Patients per year
Slide 37: TC-5214: a new late stage opportunity in Major Depressive Disorder
TC-5214: a new late stage opportunity in Major Depressive Disorder TC-5214 adjunct Phase 2b study demonstrated a strong efficacy signal & was well tolerated in patients MDD affects many people and with an inadequate response to Citalopram has a great impact on their lives 0 PBO + CIT TC-5214 + CIT ~
Slide 38: TC-5214 clinical development programme
TC-5214 clinical development TC-5214 development programme programmefor patients with inadequate response to SSRIs/SNRIs 2010 2011 2012 2013 2014 Renaissance 2 (Flex) US Renaissance 3 (Flex) MDD Adjunct Renaissance 4 (Fixed) PLANNED SUBMISSION Renaissance 5 (Fixed) Renaissance 7 (LTS) EU Additional
Slide 39: Fostamatinib disodium (FosD): a new oral approach for Rheumatoid Arthritis
Fostamatinib disodium (FosD): a new oral approach for the treatment of Rheumatoid Arthritis (RA) • RA is a systemic auto-immune inflammatory disease affecting FosD Phase 2 Trial in RA – TASKi1 Efficacy Results (12 weeks) approx. 1 in 100 people1 80 Placebo • FosD is being developed as 70 50 mg a nex
Slide 40: 2H 2010 Newsflow
2H 2010 Newsflow 5 regulatory 4 significant Key phase 3 data decisions regulatory submissions Brilinta - US Ceftaroline NME Dapagliflozin Motavizumab - US Dapagliflozin NME Zibotentan Faslodex 500 - US Vandetanib NME (orphan) ONGLYZA-metformin - US ONGLYZA-metformin Seroquel XR GAD - EU FDC in EU 40
Slide 41: Product references
Product references Brilinta 1. WHO; Cardiovascular disease: prevention and control 7/09. 2. Global Registry of Acute Coronary Events (GRACE registry). Dapagliflozin 1. Ferrannini E et al. Diabetes Care 2010. 2. Strojek K et al, EASD 2010. 3. Bailey C et al. The Lancet 2010. 4. Nauck M et al. EASD 20