Sun Pharmaceutical Industries Limited · NSE:SUNPHARMA
Sun Pharmaceutical Industries — Investor Presentation (February 2015)
39 slides from Sun Pharmaceutical Industries's investor presentation, February 2015
Slide 1: Creating Lasting Value
Creating Lasting Value Investor Presentation - February 2015 BSE:524715 • NSE:SUNPHARMA Bloomberg: SUNP@IN • Reuters: SUN.BO www.sunpharma.com
Slide 2: Disclaimer
Disclaimer Except for the historical information contained herein, statements in this presentation and the subsequent discussions, which include words or phrases such as “will”, “aim”, “will likely result”, “would”, “believe”, “may”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “pl
Slide 3: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Revenue Financials Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing Creating Lasting Value - Investor Presentation 3
Slide 4: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Revenue Financials Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing Creating Lasting Value - Investor Presentation 4
Slide 5: Revenue Composition
Revenue Composition 2013-14 Annual Gross Sales : Rs 161,995 million 5 Year CAGR 30% International Generics 5 Year CAGR 38% 12% 60% APIs 5% 5 Year CAGR 11% US Formulations 5 Year CAGR 45% 23% India Branded Generics 5 Year CAGR 14% Finished Dosage International sales 95% sales 76% 5 year CAGR 32% 5 ye
Slide 6: Creating Value, Continuously…
Creating Value, Continuously… ‘83 ‘15 2004 2010 1983 2012 2014 USD 350mn Began with 1997 FCCB raised Acquired Dusa Ranbaxy Acquisition Acquired 5 products Taro (Proposed) 1993 2013 $7.5Mn invested 2011 2007 in Caraco 1994 Acquired URL First Research Centre JV for Emerging Pharma SPARC, Baroda Market
Slide 7: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Revenue Financials Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing Creating Lasting Value - Investor Presentation 7
Slide 8: Strategy and Approach
Strategy and Approach Create sustainable revenue streams Seek cost leadership • Focus: Chronic • Vertical integration : therapies Development through Manufacturing (API and • Differentiation: Finished Dosage) to Marketing Technically complex products • Optimize operational costs • Speed to market Ba
Slide 9: Growing Steadily
Growing Steadily Consistent top-line and bottom-line growth; (Figures in Rs billion) continuing the trend despite increasing size Net Sales EBITDA 71.1 Net Profit 31.4 160.0 18.2 42.7 18.6 3.1 9.8 3.9 3.3 0.7 0.6 98-99 03-04 08-09 13-14 98-99 03-04 08-09 13-14 98-99 03-04 08-09 13-14 9
Slide 10: Sustained Profitability
Sustained Profitability Superior business model Margins consistently higher than peers* Gross Margin EBITDA Margin Net Margin 90% 60% 60% 83% 35% 80% 45% 40% 40% 70% 20% 60% 0% 20% 50% -20% 40% 0% 07-08 08-09 09-10 10-11 11-12 -40% 09-10 10-11 11-12 12-13 13-14 09-10 10-11 11-12 12-13 13-14 09-10 10
Slide 11: Track record of successful turnaround of acquisitions
Track record of successful turnaround of 16 acquisitions 4 Acquisitions - Bryan 4 Recent Acquisitions 8 Early Acquisitions Hungary, Able, Chattem Taro, DUSA, URL 3,000 2,500 2,000 1,500 1,000 500 0 Net Sales ($ Mn) EBITDA ($ Mn) Creating Lasting Value - Investor Presentation 11
Slide 12: Key Deals & Rationale
Key Deals & Rationale Year Deals Country Rationale In-licensing agreement with Merck for 2014 Global Markets Strengthening the specialty product pipeline Tildrakizumab, a biologic for psoriasis US, India, 5th largest global specialty pharma Sun Pharma – Ranbaxy Merger 2014 Emerging company, No.1 Pha
Slide 13: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Revenue Financials Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing Creating Lasting Value - Investor Presentation 13
Slide 14: India Branded Generics: Strong Base
India Branded Generics : Strong Base • Market Share :5.5%* Others 7% Neuro-Psychiatry 27% • Leadership in Opthalmology 5% chronic segment; Antiasthamatic & Top 3 in over 50% of Antiallergic 4% more than 500 brands Musculo-Skeletal & Pain 5% Gynecology & Urology 8% Diabetology 12% Cardiology Gastroen
Slide 15: Relentless Customer Focus
Relentless Customer Focus Therapy focused marketing Strong increase • 4,500+ Field employees (Including Managers) in market share covering 150,000 specialist doctors 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Cipla Ranbaxy Sun Cadila Lupin DRL Torrent Wockhardt Ipca Y
Slide 16: Therapy Focused Marketing
Therapy Focused Marketing Delivering promotional message to specialty customers. Gastroenterology, Orthopedics Cardiology, Diabetology Psychiatry, Neurology Ophthalmology Rheumatology, Urology Fertility, Asthma, Oncology Gynecology Dermatology Gynecology, COPD Creating Lasting Value - Investor Prese
Slide 17: Preferred Choice of Doctors
Preferred Choice of Doctors Leadership in key therapeutic areas* Top 10 Brands contribute 20% of India Sales Specialist Oct ‘10 Oct ‘14 Brand Name Therapy area Psychiatrists 1 1 Gemer Oral antidiabetic Neurologists 1 1 Proton pump inhibitor/ Cardiologists 1 1 Pantocid antiulcerant Orthopaedic 1 1 Su
Slide 18: US Generics
US Generics Integrated generic manufacturer with flexibility for manufacture Approvals onshore / offshore Therapy wise summary Skin, 95 Sun Pharmaceutical Industries, Inc. (SPI) CNS, 88 A wholly owned subsidiary of Sun Pharma CVS, 47 Pain, 30 Allergy, 21 Taro Pharmaceutical Industries Ltd. Oncology,
Slide 19: ANDA Pipeline: Significant ramp up
ANDA Pipeline : Significant ramp up Products Filed and Approved Status As of Sept’14, ANDAs for 130 478 484 449 products await approval (including 11 tentative approvals) 397 377 354 Sun Pharma 311 344 84 Products pending (with 6 tentative approvals) 250 225 Caraco & URL 207 18 Products pending (wit
Slide 20: Europe Generic Markets
Europe Generic Markets Focused key markets • Working on complex generic products, including injectables • Filings from Indian site Focus Countries An API and Finished Dosage manufacturing site in Hungary with controlled substance capacity Creating Lasting Value - Investor Presentation 20
Slide 21: International Branded Generic Markets
International Branded Generic Markets Semi Regulated Markets Replicating the speciality pipeline • 48 countries Product basket width and technology based products as growth drivers • 866 strong local sales force promotes brands to doctors CIS Countries China Mexico Myanmar Brazil Sri Lanka Focus Mar
Slide 22: Leveraging through Partnership
Leveraging through Partnership • Sun Pharma and Merck enter into exclusive worldwide In-licensing agreement for Merck’s investigational therapeutic antibody candidate, called Tildrakizumab to strengthen specialty pipeline • Tildrakizumab is an investigational humanized, monoclonal antibody designed
Slide 23: Speciality API
Speciality API High Margin Regulated Markets Strong regulatory capability • Business largely with end users in • 264 DMF / CEP filed regulated markets • 177 approved • Over 170 specialty APIs across 8 plants (including Taro) Creating Lasting Value - Investor Presentation 23
Slide 24: Strong Regulatory Capability
Strong Regulatory Capability International level quality processes and documentation 256 264 239 225 206 174 177 168 155 154 127 89 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Sep-14 DMF/CEP Filed DMF/CEP Approved 24
Slide 25: Integrated product dev. and manufacturing network
Integrated product dev. and manufacturing network Vertically integrated network across four continents enabling high quality, low cost and a quick market entry across the geographies Ontario (Canada) Tiszavasvari Wilmington M.A. (Hungary) Aurora Billerica, M.A Jammu Bryan Cranbury Sikkim Plant Tenne
Slide 26: Finished Dosage Manufacturing
Finished Dosage Manufacturing 18 Manufacturing sites worldwide • India : 6, US : 6 • Canada, Brazil, Mexico, Hungary , Israel, Bangladesh : 1 each • Capacities available for a variety of finished dosage Tablets / Injectables / Sterile Capsules Vials Dry powder Semisolids Ampoules Eye drops Pre-fille
Slide 27: API Manufacturing
API Manufacturing 8 World class locations with all sites ISO 14001, ISO 9002 approved • India : 5, Israel : 1, US : 1, Hungary : 1 Over 25 API processes scaled up annually Panoli & Ahmednagar Hungary & (both India) Tennessee (US) API • International regulatory Key Plants • Controlled substances appr
Slide 28: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Revenue Financials Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing Creating Lasting Value - Investor Presentation 28
Slide 29: Research and Development
Research and Development • Generic R&D spend around 6-8% of net sales • Strong research teams in generics, finished dosage development, biological support, chemistry Mumbai • 4 R&D centers with over 900 scientists Immediate term Balancing Medium term ANDA, DMF, Products for India the risk Drug deliv
Slide 30: Agenda
Agenda 5 4 3 2 Management 1 & Governance Research & Strategy & Business Development Revenue Financials Approach Operations Composition Growth Geographies History & API, Finished Profile Key Dosage & Acquisitions Manufacturing Creating Lasting Value - Investor Presentation 30
Slide 31: Corporate Governance
Corporate Governance Our philosophy on corporate governance envisages working towards high levels of transparency, accountability and consistent value systems across all facets of operations Chairman Independent Sun Pharma Directors Israel Makov Keki Mistry Hasmukh Shah Rekha Sethi Former President
Slide 32: Shareholding Pattern
Shareholding Pattern as on December 31, 2014 Individuals and • Rs 1,000 Invested in Promoter and the 1994 IPO is InsuranceCompanies Others promoter group 4% 7% 64% currently worth more Bodies Corporate than Rs. 700,000 3% Financial Inst /Banks 1% Mutual Funds 1% FIIs / Foreign Banks 22% • Total shar
Slide 33: Financials
Financials Market Capitalisation Rs. 1,900 billion / US$ 31 billion* Figures in Rs million 2009-10 2010-11 2011-12 2012-13 2013-14 P&L Summary Net Sales 40,075 57,229 80,057 112,389 160,044 Gross Profit 29,096 42,577 63,644 91,592 132,250 EBITDA 13,628 19,518 32,507 49,063 71,141 Net Profit 13,511 1
Slide 34: Financial Ratios
Financial Ratios 2009-10 2010-11 2011-12 2012-13 2013-14 Growth (%) Net Sales (6.2) 42.8 39.9 40.4 42.4 Gross Profit (14.8) 46.3 49.5 43.9 44.4 EBITDA (26.9) 43.2 66.5 50.9 45.0 Net Profit (25.7) 34.4 46.3 12.3 5.3 Net Profit (Adjusted) (25.7) 34.4 46.3 # 58.7 * 34.3 Margins (%) Gross Margin 72.6 74
Slide 35: Key Financials Q2 & H1 FY15
Key Financials Q2 & H1 FY15 Figures in Rs million Q2 FY15 Q2 FY14 CHANGE H1 FY15 H1 FY14 CHANGE FY14 Net Sales 47,505 41,921 13% 86,774 76,742 13% 160,044 Gross Profit 39,399 33,917 16% 71,019 63,485 12% 132,251 Gross Margin 83% 81% 82% 83% 83% EBITDA 21,611 18,283 18% 38,850 33,590 16% 71,141 EBITD
Slide 36: Sales Breakup Q2 & H1 FY15
Sales Breakup Q2 & H1 FY15 Figures in Rs million Q2 FY15 Q2 FY14 CHANGE H1 FY15 H1 FY14 CHANGE FY14 Formulation India 11,518 9,495 21% 21,441 17,981 19% 36,918 US 29,118 25,880 13% 52,352 46,194 13% 97,844 ROW 5,362 4,924 9% 10,275 9,431 9% 19,084 Sub-total 45,997 40,298 14% 84,068 73,606 14% 153,84
Slide 37: Sun Pharma to acquire Ranbaxy
Sun Pharma to acquire Ranbaxy • Sun Pharma to sustain its ranking as the 5th largest global specialty generic pharma company • Pro-forma financials for 12 months ended Dec’ 13 - Sales of US $ 4.2 billion and EBITDA of US $ 1.2 billion. Deal size approximately US$ 4 billion; ~ 2.2x LTM sales • No. 1
Slide 38: Guidance for FY 2014-15
Guidance for FY 2014-15 • Overall Consolidated Sales growth : 13-15% over FY14 at constant exchange rate • R&D Spend at 6-8% of revenues • Target to file 25 ANDAs in US • Capex at Rs 900 crs • Guidance takes into account: Likely risks associated with the increase in competition for some key products
Slide 39: For updates and specific queries, please visit www.sunpharma.com
For updates and specific queries, please visit www.sunpharma.com or feel free to contact Nimish Desai Frederick Castro Tel : +91 22 6645 5645, Ext 5717 Tel : +91 22 6645 5645, Ext 5964 Tel Direct : +91 22 66455717 Tel Direct : +91 22 66455964 Mobile : +91 98203 30182 Mobile : +91 99206 65176 nimish.
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