Slide 1: FY 2018 results
FY 2018 results Presentation, conference call and webcast for investors and analysts 14 February 2019
Slide 2: Forward-looking statements
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 document contains certain forward-looking statements with respect to the operations, pe
Slide 3: On the podium
On the podium Pascal Soriot Dave Fredrickson Ruud Dobber Executive Director and Executive Vice President, Executive Vice President, Chief Executive Officer Oncology BioPharmaceuticals Marc Dunoyer José Baselga Mene Pangalos Executive Director and Executive Vice President, Executive Vice President, C
Slide 4: Agenda
Agenda Overview Oncology New CVRM, Respiratory, Emerging markets Financials Pipeline update and news flow Closing and Q&A 4
Slide 5: What we set out to do
What we set out to do…. Strategic priorities from 2013 Achieve 1 Return 2 Be a great 3 scientific to growth place to work leadership 5
Slide 6: AstraZeneca returned to sustainable growth in sales
AstraZeneca returned to sustainable growth in sales Pipeline-driven transformation has delivered on the promises Business and financials Product sales increased by 8% in Q4 and by 4% in the year • Strong performance of new medicines1 (+81%) and $2.8bn incremental sales vs. 2017 • Oncology (+49%), Ne
Slide 7: Q4 2018 late-stage pipeline news
Q4 2018 late-stage pipeline news Continued progress across medicines Pipeline news Oncology • Tagrisso EGFRm1 NSCLC2 1L Priority review (CN) • Imfinzi unresectable, Stage III NSCLC Regulatory submission (CN) Regulatory submission acceptance (OS3 data) (US) • Imfinzi +/- treme NSCLC 1L (MYSTIC) Did n
Slide 8: Sales: inflection point reached
Sales: inflection point reached Strong sales growth set to continue Encouraging return to growth Key medicines driving growth in 2019 Tagrisso Imfinzi ongoing launches in ongoing launches in EGFRm NSCLC 1L unresect., StageIII NSCLC Product sales growth, percent Lynparza ongoing launches of tablet in
Slide 9: Sales: new medicines drove return to growth
Sales: new medicines drove return to growth FY 2018: $2.8bn in incremental sales; growth of 81% $m Q4 2018: FY 2018: +$1.0bn +$2.8bn 1,000 900 incremental sales of new medicines incremental sales of new medicines 800 compared to Q4 2017 compared to FY 2017 700 600 500 400 300 200 100 0 Calquence Bri
Slide 10: Sales: growth across all main therapy areas
Sales: growth across all main therapy areas Oncology, New CVRM, China all performed strongly Q4 2018 % product FY 2018 % product % change % change $m sales $m sales Product sales 5,768 8 100 21,049 4 100 Oncology 1,767 61 31 6,028 49 29 New CVRM 1,103 11 19 4,004 12 19 Respiratory 1,362 5 24 4,911 3
Slide 11: 2019: strong growth in underlying business
2019: strong growth in underlying business • Top-line growth driven by new medicines • Productivity programmes support cost management • Core operating profit to increase by a mid-teens percentage Indications at CER; this slide does not constitute formal guidance. 11
Slide 12: New, simplified organisation
New, simplified Oncology organisation Oncology Research & Development Increase focus on Manufacturing Business main therapy areas Emerging markets & Japan Agile decision-making and resource allocation BioPharma Collaboration between BioPharma R&D and business 12
Slide 13: Agenda
Agenda Overview Oncology New CVRM, Respiratory, Emerging markets Financials Pipeline update and news flow Closing and Q&A 13
Slide 14: Oncology: Establishing new standards of care
Oncology Establishing new standards of care Total Oncology sales New medicines Lynparza, Tagrisso, $m +49% FY; +61% Q4 Imfinzi and Calquence added $1.9bn 2,000 • Tagrisso quickly moving ahead to become the no. 1 1,750 1,500 AstraZeneca medicine in 2019 1,250 1,000 • Imfinzi strong US uptake; ex-US o
Slide 15: Lung cancer: Tagrisso
Lung cancer: Tagrisso 1st-line standard of care in US, JP; EU + RoW launches underway Strong performance in Worldwide approvals: >80 countries (2nd- $m all markets: +98% in Q4 line use) and ~60 countries (1st-line use) 700 600 • US +115% • Established RoW +43% Most-prescribed medicine in 1st- Japan
Slide 16: Lung cancer: Imfinzi
Lung cancer: Imfinzi Strong uptake; US peak sales now expected to be >$1bn US peak sales now PACIFIC (unresectable, Stage III US patient infusions $m expected at >$1bn NSCLC) becoming new SoC1 continue to increase 300 900 • ~40 global approvals obtained 800 US, average daily patient infusions 250 •
Slide 17: Lynparza: Leading PARP inhibitor treating more patients
Lynparza Leading PARP inhibitor treating more patients Six quarters of strong Leading PARP inhibitor approved in >60 countries $m growth: +113% in Q4 across indications in ovarian and breast cancer 250 • US +145% • Established RoW $61m Broad label in 2nd-line ovarian Successful ovarian and breast 20
Slide 18: Haematology: Calquence and Lumoxiti
Haematology: Calquence and Lumoxiti Building momentum in US; global MCL expansion underway Calquence highlights Lumoxiti $m 30 • Sales $62m, US only • First sales recorded in Q4 2018 25 • Continued good uptake • 3rd-line hairy cell leukaemia ~40% BTK1 inhibitor new-patient (HCL); small indication wi
Slide 19: New CVRM and Respiratory
New CVRM and Respiratory Strong businesses with several blockbusters, now and in the future Combined sales: Strong franchises and $m +7% FY, +8% Q4 encouraging launches 2,500 • Farxiga: leading SGLT2 inhibitor with differentiated CV1 2,250 outcomes data, global growth and more data next year 2,000 1
Slide 20: New CVRM
New CVRM Blockbusters Farxiga and Brilinta sustained strong performances Good Diabetes growth, with Q4 reduced Continued growth $m by US gross-to net adjustments in 2017 $m in Brilinta sales Farxiga +30% • Brilinta +21%: growth across all • US (+21%); market and SGLT2 major regions; Q4 benefit of 1,
Slide 21: Respiratory
Respiratory Fasenra and Pulmicort sales offsetting the Symbicort performance Respiratory delivered Symbicort, leading ICS+LABA Fasenra sales now $m improved performance medicine globally by volume annualising at $0.5bn +3% 1,500 5,000 +5% +3% US -6% US $218m, with $89m in Q4 +4% • Symbicort (-22%);
Slide 22: Fasenra: strong launch success on all metrics
22 US, market share US, market share, new-to-brand Rx Nov-17 Sep-17 Dec-17 Oct-17 Jan-18 Nov-17 Feb-18 Dec-17 Mar-18 Jan-18 Feb-18 Fasenra Main IL-5 mAb competitor Apr-18 Mar-18 US May-18 Total market share Apr-18 Jun-18 May-18 Jul-18 Jun-18 Aug-18 Jul-18 New-patients market share Sep-18 Aug-18 Oct-
Slide 23: Emerging markets
Emerging markets 2018 year-end webcast on China and Emerging markets China consistently outperforming China continued very strongly (+25%) Sales continued to grow ahead of the long-term Ex-China growth (+1%) impacted by divestments commitment of mid to high single-digit growth 12% 12% 16% Emerging m
Slide 24: Agenda
Agenda Overview Oncology New CVRM, Respiratory, Emerging markets Financials Pipeline update and news flow Closing and Q&A 24
Slide 25: Reported profit and loss
Reported profit and loss FY 2018 % total Q4 2018 % total % change % change $m revenue $m revenue Product sales 21,049 4 95 5,768 8 90 Externalisation revenue 1,041 (55) 5 649 126 10 Total revenue 22,090 (2) 100 6,417 14 100 Gross margin 76.6% (3) pp1 - 71.6% (6) pp - Operating expenses2 16,294 (1) 7
Slide 26: Core profit and loss
Core profit and loss FY 2018 % total Q4 2018 % total % change % change $m revenue $m revenue Product sales 21,049 4 95 5,768 8 90 Externalisation revenue 1,041 (55) 5 649 126 10 Total revenue 22,090 (2) 100 6,417 14 100 Gross margin 79.5% (2) pp - 78.6% (1) pp - Operating expenses1 14,248 4 64 3,995
Slide 27: Externalisation revenue
Externalisation revenue Q4 underpinned by Merck collaboration Significant Q4 revenue highlights the importance Highlights from $m and ongoing nature of the Merck collaboration externalisation revenue 1,600 1,400 • Significant Q4 externalisation revenue from Merck 1,200 collaboration 1,000 • $400m op
Slide 28: Total core operating expenses increased by 4%
Total core operating expenses increased by 4% Growth in line with sales; operating leverage from 2019 Core R&D: benefitting from productivity initiatives Operating expenses remain in $m focus, with leverage from 2019 1,500 • Core R&D expenses • FY 2018: declined by 3%. Continued high activity 0 leve
Slide 29: Cash flow
Cash flow Net debt stable in the year Development in net debt position Other key cash flow observations $bn • Net cash flow from operations reduced 12.7 7.1 3.5 13.0 • Provisions related to legal settlements 0.7 1.0 0.6 1.5 • Launch support for new medicines • Net cash inflow before financing activi
Slide 30: Readiness for the UK leaving the EU (Brexit)
Readiness for the UK leaving the EU (Brexit) Significant preparations to handle different scenarios Safeguarding access to Securing product medicines for patients supply chain • EU medicines testing standards • Additional stock moved to EU accepted in the UK if no deal/no distribution centres transi
Slide 31: 2019 guidance confirms the growth outlook
2019 guidance confirms the growth outlook Product sales Core EPS A high single-digit percentage increase $3.50 to $3.70 Guidance at CER. 31
Slide 32: Financial priorities
Financial priorities Deleveraging / Sales dividend growth growth Cash-flow Profit growth growth 32
Slide 33: Agenda
Agenda Overview Oncology New CVRM, Respiratory, Emerging markets Financials Pipeline update and news flow Closing and Q&A 33
Slide 34: Pipeline update and news flow
Pipeline update and news flow Continued progress with focus on oncology and biopharmaceuticals New R&D organisation across two Welcome to Dr. José Baselga areas, Oncology and BioPharma R&D Oncology Oncology Research & Development Oncology Manufacturing Business Emerging markets & Japan BioPharma Bio
Slide 35: 2018 year-end pipeline update
2018 year-end pipeline update Significant news flow supports sustainable growth Lynparza Fasenra Lynparza Imfinzi Lynparza Imfinzi Lynparza Tagrisso Lumoxiti Lynparza breast cancer severe asthma ovarian cancer 2L unr. SIII NSCLC breast cancer unr. SIII NSCLC ovarian cancer 2L EGFRm NSCLC HCL 3L ovar
Slide 36: Oncology: Successful quarter
Oncology Successful quarter; important progress across all key medicines Regulatory Lynparza SOLO-1 in 1st-line Calquence data highlights milestones maintenance ovarian cancer at the ASH 2018 meeting • Tagrisso - EGFRm NSCLC 1L: priority • MCL Phase II ACE-LY-004 review (CN) - 81% ORR3; 43% CR4 + 38
Slide 37: New CVRM and Respiratory
New CVRM and Respiratory Leading position in cardiovascular and respiratory diseases Significant potential for Farxiga Other major to benefit many more patients milestones • roxadustat - anaemia of CKD: DECLARE trial • Forxiga - add-on indications two Phase III trials met primary CVD/HHF Statistical
Slide 38: Late-stage pipeline events in the 2019, 2020 timeframe
Late-stage pipeline events in the 2019, 2020 timeframe Busy news flow continues; underpinning consistent sales growth H1 2019 H2 2019 2020 Regulatory Tagrisso - EGFRm NSCLC 1L (CN) Imfinzi - unresectable, Stage III NSCLC (CN) - Lynparza - breast cancer (EU) Lynparza - ovarian cancer 1L(SOLO-1)(EU, J
Slide 39: 'What's next'?
‘What’s next’? Rich mid-stage pipeline; selected new molecular entities underway Oncology New CVRM Respiratory capivasertib (AKT1 inhibitor) monalizumab(NKG2a5 mAb6) cotadutide(GLP-110/glucagon PT027 (SABA/ICS16) breast, prostate cancers head & neck, colorectal co-agonist) - NASH11 asthma Phase III
Slide 40: Agenda
Agenda Overview Oncology New CVRM, Respiratory, Emerging markets Financials Pipeline update and news flow Closing and Q&A 40
Slide 41: AstraZeneca returned to sustainable growth in sales
AstraZeneca returned to sustainable growth in sales Pipeline-driven transformation has delivered on the promises Product sales increased by 8% in Q4 and by 4% in the year • Strong performance of new medicines1 (+81%) and $2.8bn incremental sales vs. 2017 • Oncology (+49%), New CVRM2 (+12%) and Respi
Slide 42: Q&A
Q&A
Slide 43: AstraZeneca returned to sustainable growth in sales
AstraZeneca returned to sustainable growth in sales Pipeline-driven transformation has delivered on the promises Product sales increased by 8% in Q4 and by 4% in the year • Strong performance of new medicines1 (+81%) and $2.8bn incremental sales vs. 2017 • Oncology (+49%), New CVRM2 (+12%) and Respi
Slide 44: Use of AstraZeneca conference call, webcast and presentation slides
Use of AstraZeneca conference call, webcast and presentation slides The AstraZeneca webcast, conference call and presentation slides (together the ‘AstraZeneca Materials’) are for your personal, non- commercial use only. You may not copy, reproduce, republish, post, broadcast, transmit, make availab
Slide 45: FY 2018 results
FY 2018 results Presentation, conference call and webcast for investors and analysts 14 February 2019