H. Lundbeck A/S Class A · OMXCOP:HLUN_A
H. Lundbeck A/S Class A — FY2004 Earnings Presentation
47 slides from H. Lundbeck A/S Class A's earnings presentation, Mar 10, 2005
Slide 1: Financial Presentation 2004
Financial Presentation 2004
Slide 2: Safe Harbour Statement
10 March, 2005 Page 2 Safe Harbour Statement This presentation contains forward-looking statements that reflect the Management’s current views with respect to certain future events and financial performance. Statements containing the outlook for 2005 and the following years naturally involve uncerta
Slide 3: Highlights
10 March, 2005 Page 3 Highlights • Market development: – By the end of 2004 Cipralex® was approved on all major markets except France and Japan and covers more than 90% of worldwide antidepressant market – Lexapro reaches all time high 15.0% market share in the US – Ebixa has been successfully intro
Slide 4: The Lundbeck story – CNS expertise for 50 years and 10 years of expansion
10 March, 2005 Page 4 The Lundbeck story – CNS expertise for 50 years and 10 years of expansion from local to global Psychosis, N5A 1996 Serdolect® 2007 Bifeprunox 1959: Lundbecks first anti- psychotic Truxal® was launched Depression, N6A 1989 Cipramil® 2002 Cipralex® 1961: Lundbecks first anti- dep
Slide 5: Pipeline projects within disease areas covering more than 50% of CNS market
10 March, 2005 Page 5 Pipeline projects within disease areas covering more than 50% of CNS market World pharmaceutical market Total CNS market USDbn 77.2 2003 USDbn 466.3 (+9%) (+13%) Therapeutic area Share Growth 8% of CNS 2003 17% 3% Alzheimer's Disease, 3% +27% 5% N7D (N) CNS Depression, N6A 25%
Slide 6: CNS category fastest growing in the past – high growth expected to continue
10 March, 2005 Page 6 CNS category fastest growing in the past – high growth expected to continue CNS world market in USD, 1999-2008 140 CNS Market characteristics: 120 CAGR 03-08: – Increased population 100 10.9% – Increased life expectancy USD Bill. 80 CAGR 99-03: 12.1% 60 – Increased health aware
Slide 7: Value creation through introduction of new compounds and own presence in the US and Japan
10 March, 2005 Page 7 Value creation through introduction of new compounds and own presence in the US and Japan Value • Introduction of new innovative • Depression, • Launch of compounds Alzheimer's & Gaboxadole for • Establishment of psychosis • Launch of sleep disorders sales infrastructure franch
Slide 8: New products account for 52% of revenue – progressing well through transition
10 March, 2005 Page 8 New products account for 52% of revenue (excl. gaboxadol) – progressing well through transition 10,000 2% 2% 3% 7% <1% 9% 7% 26% 8,000 42% DKKm 6,000 Other revenue Ebixa Cipralex/Lexapro Mature (incl. citalopram) 4,000 88% 69% 44% 2,000 0 FY 2002 FY 2003 FY 2004
Slide 9: US market
US market
Slide 10: Well established in the US antidepressant market
10 March, 2005 Page 10 Well established in the US antidepressant market. Possibilities within sleep and anti-psychotics US market – 59% of world CNS market - Lundbeck products cover 23.7 USD bn. (2003)* 13.2 Lundbeck products with US rights (+11%) Value, USD bn. (2003) 15 7.8 Lexapro Sold via Forest
Slide 11: Income growth in CER from US franchise
10 March, 2005 Page 11 Income growth in CER from US franchise. Continued growth in Lexapro® income despite weakened USD Growth US franchise FY 2004 FY 2003 Growth in CER Income from Lexapro® 2,420 1,927 26 % 63 % Mature products* 981 1,725 -43 % -23 % Total revenue, US franchise 3,401 3,652 -7 % 22
Slide 12: Lexapro higher than peak Celexa; reaches highest ever market share of 15.0%
10 March, 2005 Page 12 Lexapro® higher than peak Celexa®. Lexapro® reaches highest ever market share of 15.0% US anti-depression franchise 24% 20% Market share in value (N6A) Citalopram peak: July 2002, 13.8% 17.4% 16% 15.0% 12% Generic citalopram 8% 4% 2.4% 0% jan-02 jul-02 jan-03 jul-03 jan-04 jul
Slide 13: Severe weakening in the USD compensated by growth in Lexapro
10 March, 2005 Page 13 Severe weakening in the USD compensated by growth in Lexapro® 6,000 DKK/USD 10 5,500 5,000 9 8.42 8.32 4,500 -15% 7.90 4,000 8 3,500 7.78 3652 -11% DKKm 3401 3,000 3155 7 6.68 2,500 6.65 5.97 2,000 6 1916 1,500 1,000 1152 5 500 511 0 4 '99 '00 '01 '02 '03 '04 '05 Yearly US inc
Slide 14: Gaboxadol – a new treatment for sleep disorder
10 March, 2005 Page 14 Gaboxadol – a new treatment for sleep disorder Over 60 million Americans suffer Market size of 2.2 USDbn from insomnia in 2003 (+23%) with 85% undiagnosed or untreated Gaboxadol (Phase III) 9m (15%) Selective Extrasynaptic GABA agonist Not a Benzodiazepine – 8m (13%) n
Slide 15: Agreement with Merck & Co. on gaboxadol ensures establishment of a Lundbeck US sales infrastructure
10 March, 2005 Page 15 Agreement with Merck & Co.,Inc. on gaboxadol ensures establishment of a Lundbeck US sales infrastructure Support business model with specialist focus Merck & Co., Inc. provides large scale sales force Merck & Co., Inc. support Lundbeck’s build-up of sales force (quid, tr
Slide 16: European market
European market
Slide 17: European infrastructure in place. Significant leverage from new product launches
10 March, 2005 Page 17 European infrastructure in place. Significant leverage from new product launches Europe – 26% of world CNS market - Lundbeck products with Lundbeck products cover USDbn 9.5 (2003)* European rights Cipralex - (launched) Value, USD bn. (2003) 6 4.2 2.8 Ebixa - (+5%) (+20%) 4 (la
Slide 18: High growth in Cipralex and Ebixa expected to continue
10 March, 2005 Page 18 High growth in Cipralex® and Ebixa® expected to continue. Mature products expected to decline – but at a slower rate Growth European franchise FY 2004 FY 2003 Growth in CER Cipralex® 1,404 579 143 % 144 % Ebixa® 675 276 145 % 145 % Mature products* 2,511 3,841 -35 % -34 % Tota
Slide 19: Country by country roll-out in Europe entails significant growth potential for Cipralex
10 March, 2005 Page 19 Country by country roll-out in Europe entails significant growth potential for Cipralex® going forward European anti-depression franchise 20% Citalopram peak: March 2002, 17.0% 16% Market share in value (N6A) 13.1% 12% 8% 6.8% 6.3% 4% 0% jan-02 jul-02 jan-03 jul-03 jan-04 jul-
Slide 20: Recent launches of Cipralex in Europe
10 March, 2005 Page 20 Top 3 branded MS% compounds (Dec 04) Recent launches of Cipralex® in Europe Effexor 18.4% Zoloft 13.2% Paxil 8.4% 14% I 12% TR Market share in value (N6A) 10% 8% ESP P 6% GER 4% 2% 0% 0 +1 +2 +3 +4 +5 +6 +7 +8 +9 +10 +11 +12 +13 +14 +15 +16 +17 +18 Months after Cipralex®/Lexap
Slide 21: Memantine now 2nd most used Alzheimer's drug in Europe
10 March, 2005 Page 21 Memantine now 2nd most used Alzheimer’s drug in Europe – primarily driven by growth in Ebixa® European anti-Alzheimer’s franchise 20% 18.1% 16% Market share in value (N7D) 12% 11.9% 8% 6.2% 4% 0% sep-02 mar-03 sep-03 mar-04 sep-04 Lundbeck Ebixa (Europe) Other Memantine (Europ
Slide 22: Recent launches of Ebixa in Europe
10 March, 2005 Page 22 Recent launches of Ebixa® in Europe 24% TR 21% F 18% Market share in value (N7D) P 15% 12% 9% B 6% CH 3% 0% 0 +1 +2 +3 +4 +5 +6 +7 +8 +9 +10 +11 +12 +13 +14 +15 +16 +17 +18 Months after Ebixa® launch F CH B TR P From launch with reimbursement Source: IMS, N7D, December
Slide 23: Conversion in Europe will continue to drive high growth in the anti-psychotics market
10 March, 2005 Page 23 Conversion in Europe will continue to drive high growth in the USDbn 2.8 anti-psychotics market… N5A – Value and volume, MAT 09-2004 N5A - Split in volume, MAT 09-2004 100% Value 38% 74% 26% 80% 50% Volume 62% 41% 59% 20% 0% 0% 50% 100% North America Europe North America Europ
Slide 24: A potential new compound will position Lundbeck in the atypical antipsychotic market
10 March, 2005 Page 24 …and a potential new compound will position Lundbeck in the atypical antipsychotic market Bifeprunox (Phase III) Partial dopamine D2-receptor-agonist and serotonin 5-HT1A-agonist Expected advantages: No weight gain No increase in prolactin Favourable lipid profile
Slide 25: RoW market
RoW market
Slide 26: Establishment in RoW markets ensures access to future expected growth
10 March, 2005 Page 26 Establishment in RoW markets ensures access to future expected growth Lundbeck products with RoW rights RoW market – 15% of world CNS market - Lundbeck products cover USDbn 5.5 (2003)* Cipralex - (launched) Ebixa Outside Japan Value, USD bn. (2003) 4 2.3 (launched) (+17%) 1.5
Slide 27: Decline in Mature products driven by launch of generic citalopram in Canada
10 March, 2005 Page 27 Decline in Mature products driven by launch of generic citalopram in Canada (81% of loss) Growth ROW franchise FY 2004 FY 2003 Growth in CER Cipralex® 257 66 287 % 310 % Ebixa® 47 10 380 % 419 % Mature products* 807 1,253 -36 % -33 % Total revenue, ROW 1,111 1,329 -16 % -13 %
Slide 28: Significant growth expected for Cipralex in RoW
10 March, 2005 Page 28 Significant growth expected for Cipralex® in RoW – contributed by recent launch in Canada RoW anti-depression franchise 20% Citalopram peak: Generic citalopram May 2003, 13.4% in Canada 16% Market share in value (N6A) 12% 8% 7.6% 4% 4.0% 3.6% 0% jan-02 jul-02 jan-03 jul-03 jan
Slide 29: Recent launches of Lexapro outside Europe
10 March, 2005 Page 29 Recent launches of Lexapro® outside Europe 16% 14% EGY 12% Market share in value (N6A) SAU SA 10% 8% AUS 6% 4% 2% 0% 0 +1 +2 +3 +4 +5 +6 +7 +8 +9 +10 +11 +12 +13 +14 +15 +16 +17 +18 Months after Lexapro® launch EGY AUS SA SAU Source: IMS, N6A, December
Slide 30: Memantine continue to gain market share – driven by successful Ebixa launches
10 March, 2005 Page 30 Memantine continue to gain market share – driven by successful Ebixa® launches RoW anti-Alzheimer’s franchise 9% 6.9% Market share in value (N7D) 6% 5.6% 3% 1.3% 0% sep-02 mar-03 sep-03 mar-04 sep-04 Ebixa Other memantine Combined Source: IMS Dataview, December 2004
Slide 31: News flow & Pipeline
News flow & Pipeline
Slide 32: News flow in 2005
10 March, 2005 Page 32 News flow in 2005 Cipralex, escitalopram Timing – Approval of GAD indication in Europe 2H – Launch in France 2005 Ebixa, memantine – Approval of mild to moderate indication in Europe 2H Azilect, rasagiline – Launch in the first European country 2005 Bifeprunox – Phase III clin
Slide 33: Pipeline
10 March, 2005 Page 33 Pipeline Dev. Compound Activity Indication 2005 2006 2007 2007+ stage Rasagiline MAO-B Parkinson’s Approved Launch Generalised Escitalopram ASRI Filed Launch anxiety disorder NMDA Mild to moderate Memantine Filed Launch antagonist Alzheimer’s Sertindole D2-5HT2 Schizophrenia P
Slide 34: Financial overview
10 March, 2005 Page 34 Financial overview Growth DKKm FY 2004 FY 2003 Growth in CER Revenue 9,733 9,941 -2 % 9% - Cipralex® 1,661 645 157 % 161 % - Income from Lexapro® 2,420 1,927 26 % 63 % - Ebixa® 722 286 153 % 154 % - Mature products* 4,299 6,819 -37 % -32 % - Other revenue 631 264 140 % 156 % C
Slide 35: Financial guidance and mid-term targets
10 March, 2005 Page 35 Financial guidance and mid-term targets FY 2004* FY 2003 2005 Guidance 2006 target 2007 target Approx. DKKbn EBIT 2,154 2,132 +12% growth +12% growth 2.2 On level with EBIT margin 23.1% 21.4% 25% margin 2004 Approx. DKKm CAPEX 244 1.479 550 On level with COGS 1,724 1,759 2003
Slide 36: More information please contact Investor Relations
10 March, 2005 Page 36 More information please contact Investor Relations Steen Juul Jensen Jacob Tolstrup Mads Bjerregaard VP Corporate Finance Investor Relations Manager Investor Relations Officer Corporate Reporting Corporate Reporting Corporate Reporting Tel: + 45 36 43 30 06 Tel: + 45 36 43 30
Slide 37: Appendix
Appendix
Slide 38: Revenue by region by quarter, DKKm
10 March, 2005 Page 38 Revenue by region by quarter, DKKm Europe FY 2003 Q1 04 Q2 04 Q3 04 Q4 04 FY 2004 Cipralex® 579 306 339 382 377 1,404 Ebixa® 276 136 162 169 208 675 Mature products* 3,841 693 670 610 538 2,511 Total revenue, Europe 4,696 1,135 1,171 1,161 1,123 4,590 US** FY 2003 Q1 04 Q2 04
Slide 39: Impact from IFRS 2 & 3 on financial accounts
10 March, 2005 Page 39 Impact from IFRS 2 & 3 on financial accounts • IFRS 3: Goodwill will be subject to impairment test once a year – Depreciation of DKKm 56 in 2004 – Goodwill amounts to DKKm 883 as of 31 Dec. 2004 • IFRS 2: Options and other share based incentive schemes – Share price based prog
Slide 40: Lundbeck recognition of income from Forest
10 March, 2005 Page 40 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 i
Slide 41: Worldwide pharmaceutical market 2003
10 March, 2005 Page 41 Worldwide pharmaceutical market 2003 USD 466,3 billion, (+9%) 8% 17% (+13%) 3% (+5%) 5% (+5%) (N) CNS 6% (+13%) (C) Cardiovascular (A) Alimentary (J) Anti-Infectives 16% (+8%) (R) Respiratory 6% (+15%) (L) A+Immun (B) Blood (M) Muscolo-Skeletal 7% (+16%) (G) G.U.& Sex Hormones
Slide 42: Worldwide CNS market 2003
10 March, 2005 Page 42 Worldwide CNS market 2003 USD 77,2 billion, (+13%) 8% 3% (+27%) 3% (+8%) 25% (+10%) N6A Antidepressants 3% (+9%) N5A Antipsychotics 3% (-1%) N3A Anti-Epileptics N2B Non-Narcotic Analgesics 4% (+7%) N2A Narcotic Analgesics N5B Hypnotics & Sedatives 4% (+11%) N2C Anti-Migraine P
Slide 43: Alzheimer's (N7D-2003) – 2.3 bill. USD
10 March, 2005 Page 43 Alzheimer’s (N7D-2003) – 2.3 bill. USD (+30%) Value Market Shares of N7D Rest of Europe Q4 2003 Memantine USA Q4 2003 world North 15% America Galantamine 53% Rivastigmine Donepezil Europe 32% 0% 10% 20% 30% 40% 50% 60% 70% Leading product Marketing Corporation Sales 2003 (USDm
Slide 44: Depression (N6A-2003) – 19.5 bill. USD
10 March, 2005 Page 44 Depression (N6A-2003) – 19.5 bill. USD (+10%) Value Market shares of N6A Europe Q4 2003 Rest of Mirtazapine USA Q4 2003 North world America Fluoxetine 8% 71% Venlafaxine Citalopram/Escitalopram Sertraline Europe Paroxetine 21% 0% 5% 10% 15% 20% 25% Leading product Marketing Co
Slide 45: Anti-Parkinson's (N4A - 2003) – 2.2 bill. USD
10 March, 2005 Page 45 Anti-Parkinson’s (N4A - 2003) – 2.2 bill. USD (+9%) Value Market Shares of N4A - Europe Europe Q4 2003 North NMDA America MAOI 33% Anticholinergics COMT Europe 41% Levodopa Dopamine agonists Rest of 0% 10% 20% 30% 40% 50% 60% world Value Market shares of N4A - USA 26% USA Q4 2
Slide 46: Antipsychotics (N5A-2003) – 12.2 bill. USD
10 March, 2005 Page 46 Antipsychotics (N5A-2003) – 12.2 bill. USD (+20%) North Value Market Shares of N5A Rest of America Europe Q4 2003 world 67% Aripiprazole USA Q4 2003 10% Risperidone Olanzapine Amisulpride Clozapine Ziprasidone Europe Quetiapine 23% 0% 10% 20% 30% 40% 50% Leading product Market
Slide 47: Worldwide sales of hypnotics (N5B - 2003) – 3.3 bill. USD
10 March, 2005 Page 47 Worldwide sales of hypnotics (N5B - 2003) – 3.3 bill. USD (+11%) Value Market Shares of N5B North Europe America Europe Q4 2003 27% 53% USA Q4 2003 Zaleplon Zopiclone Rest of world Zolpidem 20% 0% 20% 40% 60% 80% 100% Leading product Marketing Corporation Sales 2003 (USDm) Gro