Mayne Pharma Group Ltd. · ASX:MYX
Mayne Pharma — Investor Presentation (February 2019)
35 slides from Mayne Pharma's investor presentation, Feb 22, 2019
Slide 1: Mayne Pharma Group Limited 1HFY19 Results Presentation
Mayne Pharma Group Limited 1HFY19 Results Presentation 22 February 2019 Scott Richards, Chief Executive Officer Nick Freeman, Group Chief Financial Officer 1
Slide 2: Disclaimer
Disclaimer The information provided is general in nature and is in summary form only. It is not complete and should be read in conjunction with the company’s audited Financial Statements and market disclosures. This material is not intended to be relied upon as advice to investors or potential inves
Slide 3: Executive summary
Executive summary ● Reported revenue up 13%, reported gross profit up 67% and reported EBITDA up 184% on the prior corresponding period (pcp) Financial ● Underlying EBITDA up 16% and underlying NPAT up 35% on pcp results ● Positive operating cash flow of A$53.5m up 11% on pcp ● Balance sheet strengt
Slide 4: 1HFY19 key financial metrics
1HFY19 key financial metrics1 Reported basis Reported basis Operating cashflow Gross Profit A$53.5m, +11% A$160.4m, +67% Reported basis Revenue Underlying basis EBITDA2 Reported basis EBITDA A$274.4m, A$81.2m, +16% A$65.4m, +184% +13% Underlying basis Reported basis NPAT NPAT A$21.1m, +35%
Slide 5: Profit and Loss – attributable to members
Profit and Loss – attributable to members Half Year Ending Change A$million 31 Dec 18 31 Dec 17 $ % Reported revenue 274.4 243.3 31.1 13% Reported gross profit 160.4 95.9 64.5 67% Gross profit % 58% 39% Underlying EBITDA 81.2 69.9 11.3 16% Adjustments1 (15.8) (46.9) 31.1 (66%) Reported EBITDA 65.4 2
Slide 6: Segment performance
Segment performance Change 1HFY19 Change 1HFY19 A$million 1HFY19 2HFY18 1HFY18 v 1HFY18 v 2HFY18 SBD 43.3 30.9 13.8 213% 40% GPD 175.9 204.8 180.9 (3%) (14%) MCS 33.9 33.4 29.7 14% 2% MPI 21.3 18.0 18.8 13% 18% Reported revenue 274.4 287.0 243.3 13% (4%) SBD 37.8 25.9 11.6 227% 46% GPD 100.3 113.8 6
Slide 7: Market and business overview
Market and business overview
Slide 8: US pharma market dynamics
US pharma market dynamics Topic Event Mayne Pharma’s response ● More stabilised retail generic pricing ● Targeting clinically differentiated branded environment products Pharma ● Increasing managed care pricing pressures and ● Portfolio optimisation pricing and drug access issues for patients ● Ther
Slide 9: Key therapeutic focuses are dermatology, women's health and ID/pulmonology
Mayne Pharma’s key therapeutic focuses are dermatology, women’s health and ID/pulmonology ● Mayne Pharma’s US commercial infrastructure is scalable to support Dermatology further products and therapeutic areas DORYX® ● Targeting therapeutic categories aligned FABIOR® to preferred distribution model
Slide 10: Actively rebalancing the portfolio toward sustainable high growth therapeutic areas and channels
Actively rebalancing the portfolio toward sustainable high growth therapeutic areas and channels 1H19 revenue breakdown (A$m) ● Development pipeline focused on expanding portfolio within these therapeutic platforms - >75% of 1HFY19 R&D spend directed to key therapeutic categories 19% - Brand pipelin
Slide 11: Mayne Pharma has a unique and differentiated dermatology platform
Mayne Pharma has a unique and differentiated dermatology platform… ● Mayne Pharma has a differentiated dermatology portfolio Mayne Pharma dermatology portfolio by key skin with an established front end commercial platform diseases - 4 patent protected dermatology brands and 5x multi- source products
Slide 12: …with a growing dermatology development pipeline
…with a growing dermatology development pipeline ● Pipeline products targeted at major diseases states such as atopic dermatitis, pruritus and rosacea as well as rare diseases such as congenital ichthyosis and Basal Cell Carcinoma Nevus Syndrome (BCCNS) Product / Mkt size Formulation Pre- Indication
Slide 13: Control of two dermatology orphan disease programs
Mayne Pharma now controls the development of two dermatology orphan disease programs SUBA®-itraconazole in BCCNS Trifarotene ● SUBA®-itraconazole is being repurposed as a ● Trifarotene is a new chemical entity under Phase II potential anti-cancer treatment in BCCNS- development for congenital ichthy
Slide 14: Broad Women's Health portfolio covering physician needs
Broad Women’s Health portfolio covering physician needs ● Mayne Pharma has an extensive women’s health Mayne Pharma contraceptive portfolio portfolio focused on contraceptives Type of Market TRx1 Mayne Pharma’s Mayne Pharma’s - 18x branded multi-source and 3x multi-source contraceptive (millions) ma
Slide 15: Launch of TOLSURA establishes a new Infectious Disease / Pulmonology platform
Launch of TOLSURA™ establishes a new Infectious Disease / Pulmonology platform ● Launch of TOLSURA™ (SUBA®-itraconazole) has enabled Potential expanded addressable market Mayne Pharma to establish a new infectious disease / pulmonology platform 11% Endemic mycoses, on label - TOLSURA™ is a new formu
Slide 16: Future value potential from SUBA-itraconazole as Hedgehog pathway inhibitor
Significant future value potential from SUBA®- itraconazole as an inhibitor of the Hedgehog signalling pathway ● Whilst SUBA®-itraconazole is used to treat fungal infections, it also has notable anti-cancer effects through inhibition of the Hedgehog signalling pathway ● In 1HFY19, Mayne Pharma assum
Slide 17: Segment overviews
¢ pharma Segment overviews
Slide 18: Specialty Brands Division (SBD)
Specialty Brands Division (SBD) Specialty Brands Division (SBD) ● In USD terms, SBD revenue was US$31.3m, up 190% on pcp Change and up 31% on 2HFY18 A$million 1HFY19 1HFY18 1HFY19 v 1HFY18 ● FABIOR® and SORILUX® revenue up 97% and 73% respectively versus pcp Revenue 43.3 13.8 213% Gross Profit 37.8
Slide 19: Expanded sales team and marketing driving prescription growth of foams
Specialty Brands Division Expanded sales team and marketing (SBD) driving prescription growth of foams FABIOR® weekly prescriptions (TRx) ● 60 person acne sales team promoting FABIOR® and 3000 DORYX® family 2500 ● FABIOR® TRx growth of 52% 1HFY19 v pcp 2000 - FABIOR® TRx 3.5x previous peak volume of
Slide 20: DORYX remains a key franchise
Specialty Brands Division (SBD) DORYX® remains a key franchise ● The acquisition of DORYX® in 2015 for US$50m has delivered substantial benefits to Mayne Pharma - New specialty brands platform created and enabled follow on acquisitions of SORILUX®, FABIOR® AND LEXETTE™ - Delivered strong returns on
Slide 21: Recent US launches of TOLSURA and LEXETTE
Recent US launches of TOLSURA™ and Specialty Brands Division (SBD) LEXETTE™ to drive further growth of Specialty Brands ● New formulation of itraconazole to treat certain ● New formulation of halobetasol to treat plaque systemic fungal infections psoriasis ● Approved by FDA December 2018 ● Approved
Slide 22: Generic Products Division (GPD)
Generic Products Division (GPD) Generic Products Division (GPD) ● In USD terms, GPD revenue was US$127m down 10% on Change pcp and down 19% on 2HFY18 with dofetilide the key A$million 1HFY19 1HFY18 1HFY19 v contributor of the decline 1HFY18 - Gross profit was up 47% on pcp Revenue 175.9 180.9 (3%) ●
Slide 23: Select US Gx product market share
Generic Products Division (GPD) Select US Gx product market share Leading edge IQVIA product Change in product # of Gx actively product market Product market size # of Gx approvals TRx market share marketed share (week ending (US$m) 4QCY18 v 2QCY18 8 Feb 2019) Dofetilide capsule 135 6 5 -19% 41%1 (G
Slide 24: US filed multi-source pipeline to drive future growth
Generic Products Division US filed multi-source pipeline to drive (GPD) future growth US filed pipeline by # of multi-source competitors >US$5b pipeline value of which >US$3b ● 8 filed products with no Gx competitors 3,000 pending approval at FDA ● Gx NUVARING® remains a key filed pipeline product o
Slide 25: Metrics Contract Services (MCS)
Metrics Contract Services (MCS) Metrics Contract Services (MCS) ● In USD terms, MCS revenue was US$24.5m, up 6% on pcp Change A$million 1HFY19 1HFY18 1HFY19 v ● Growth in revenue and gross profit driven by commercial 1HFY18 manufacturing revenues following completion of new solid oral dose manufactu
Slide 26: MCS client products at all stages of development
Metrics Contract Services MCS client products at all stages of (MCS) development1 Phase I Phase II Phase III On-market / Commercial Analytical Services 40 42 29 35 Formulation development/ manufacturing 21 20 13 3 Potential pipeline of future commercial manufacturing contracts 20+ commercial manufac
Slide 27: Mayne Pharma International (MPI)
Mayne Pharma International (MPI) Mayne Pharma International (MPI) ● MPI sales and gross profit benefited from growth in key Change specialty products - MONUROL® (fosfomycin trometamol) A$million 1HFY19 1HFY18 1HFY19 v and UROREC® (silodosin) and growing global sales of 1HFY18 morphine sulfate and SU
Slide 28: Outlook
Outlook Specialty ● Benefit from continued promotion of FABIOR®, SORILUX® and the DORYX® family and new Brands product launches of TOLSURA™ and LEXETTE™ ● Performance will depend period to period on many factors including timing of new product Generic launches, cost savings from the transfer of prod
Slide 29: Financial information
¢ pharma Financial information
Slide 30: Adjusted earnings attributable to members
Adjusted earnings attributable to members EBITDA Net income A$million 1HFY19 1HFY18 Change A$million 1HFY19 1HFY18 Change Reported result 65.4 23.0 42.4 Reported result 2.6 (174.2) 176.8 Impairment - - - Impairment - 139.8 (139.8) SBD – abnormal Doryx® SBD – abnormal Doryx® - 13.3 (13.3) - 9.2 (9.2)
Slide 31: Greater investment in brand R&D and commercial infrastructure
Greater investment in brand R&D and commercial infrastructure to support recent brand launches R&D spend1 ● More than 40% of 1HFY19 R&D spend directed to A$million 1HFY19 1HFY18 Change brands R&D expensed2 11.7 4.7 7.0 ● >75% of 1HFY19 R&D spend directed to key R&D capitalised 11.4 19.2 (7.9) therap
Slide 32: Consolidated Balance Sheet Position
Consolidated Balance Sheet Position As at As at Change A$million 31 Dec 18 30 Jun 18 $m Cash 96.2 87.3 8.9 Inventory 100.6 82.2 18.5 Receivables 300.8 252.7 48.1 PP&E 238.0 230.1 7.9 Intangibles & goodwill 1,178.8 1,054.5 124.3 Other assets 98.1 123.7 (25.6) Total assets 2,012.5 1,830.5 182.0 Payabl
Slide 33: Consolidated Cash Flow – EBITDA to Cash Reconciliation
Consolidated Cash Flow – EBITDA to Cash Reconciliation Half Year ending Change A$million 31 Dec 18 31 Dec 17 $m 1 Reported EBITDA attributable to members 65.4 23.0 42.4 Minority share of HPPI EBITDA (1.4) (1.1) (0.3) Consolidated EBITDA (100% HPPI) 64.0 21.9 42.1 Share based payments (non cash) 4.1
Slide 34: Net debt and operating cashflow
Net debt and operating cashflow Impact of FX on Net debt (A$m) ● Increase in net debt driven by strengthening USD 301.8 - AUD:USD 0.7407 (30 June 18) 298.8 - AUD:USD 0.7054 (31 December 18) 286.9 ● Strengthening USD is positive to Mayne Pharma’s net asset value with 90% of assets and revenue in USD
Slide 35: Capital structure
Capital structure ● Dual currency debt facility - US$150m, 3 year bullet facility, matures December 2021 - US$250m 5 year revolving facility, matures December 2023 - US$50m 364 days receivables financing facility (non-recourse facility) - US$20m 2 year working capital facility, matures July 2019 - A
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