Novo Nordisk A/s Class B · OMXCOP:NOVO_B
Novo Nordisk A/s Class B — Non-Deal Roadshow (February 2003)
58 slides from Novo Nordisk A/s Class B's roadshow presentation, February 2003
Slide 1: Novo Nordisk A/S – A focused healthcare company
Novo Nordisk A/S A focused healthcare company Investor presentation – February 2003 1
Slide 2: Forward-looking statements
Forward-looking statements This presentation contains forward-looking statements as the term is defined in the US Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks, uncertainties and inaccurate assumptions. This may cause actual results to differ
Slide 3: Agenda
Agenda • Highlights • Diabetes care • Haemostasis management • Research and development • Financial update • Questions and answers 3
Slide 4: Highlights
Highlights Sales 2002 • +6% as reported and +11% in local currencies for the full year • +4% as reported and +11% in local currencies for the fourth quarter Operating profit 2002 • +7%; revised target for the year met • +8% for the fourth quarter Outlook 2003 • Sales up more than 5% reported or 13%
Slide 5: Sales in 2002 by therapy and region
Sales in 2002 - by therapy and region By therapy By region HRT -6% International Growth hormone Operations Europe Diabetes care therapy +21% +3% -2% 5% +6% 16% 8% Haemostasis management 14% Japan & Oceania 17% 43% +17% -6% 70% 24% North America Total DKK 25.2 billion +12% +6% reported and +11% in lo
Slide 6: Diabetes care
Diabetes care Key observations DKK billion 5% R 1 • Sales +6% in 2002, CAG +11% in local currencies 15 5Y • Growth in North America driven by 10 • Analogues • Devices • Growth in International 5 Operations driven by • Strong demand • Acquisition of 0 Biobrás 1998 1999 2000 2001 2002 6
Slide 7: Diabetes – an unfolding epidemic
Diabetes – an unfolding epidemic 370 million people with diabetes expected by 2030 # of people with diabetes (million) 300 2000 250 2030 200 150 100 50 0 US Japan Europe Rest of World Source: WHO, January 2003 7
Slide 8: Insulin – the ultimate treatment
Insulin - the ultimate treatment Diet and exercise alone Oral therapy (66%) Typ -Cell function e2 Oral/insulin - slo pe (7%) Insulin therapy (27%) Type 1 - Immediate need for insulin Time from diagnosis 8
Slide 9: Insulin market overview
Insulin market overview - in volume Market size Growth rates Novo Nordisk Market Novo Nordisk market share USA 7.6% 27% ▲ 42% 11.9% Europe 6.2% 47% 6.2% 58% ► Japan 9.6% 5.2% 76% ▼ 4% 7.0% World 7.8% 46% ▲ 100% Data based on IMS for USA, Europe, Japan, Canada, South Africa, New Zealand and Australia
Slide 10: Adding value to volume
10 HumanInsulin Animal insulin insulinanalogue Vials Adding value to volume Durables Disposables
Slide 11: Continued penetration of analogues
Continued penetration of analogues Insulin volumes split by type Key observations 100% • Strong growth in analogues Animal insulin • Analogue penetration not at expense of human insulin Human insulin, growth -1% y/y • Novo Nordisk expected to be the first company with full analogue palette Analogues
Slide 12: Analogues drive growth
Analogues drive growth Novo Nordisk’s share of analogues Volume Key observations 14% • NovoRapid®/NovoLog® 12% continues to gain market share 10% • Roll-out of NovoMix® 30 8% backed by extensive trial 6% programme 4% • NovoMix® 50 and NovoMix® 70 2% to be filed by second half 2003 0% • Expected laun
Slide 13: Devices drive growth
Devices drive growth Insulin volume split by presentation Key observations 100% • Strong growth in disposable devices Vials 48%, (+4%y/y) • Novo Nordisk ready to capture growth • FlexPen®: now launched in more than 18 countries. Continued roll- Durable 33%, (+8%y/y) out in 2003 • InnoLet®: now launc
Slide 14: The insulin business case
The insulin business case • Epidemic growth in number Volume of people with diabetes drivers • One third are diagnosed • Trend towards earlier and 5% more intensive therapy • Conversion from human + insulin to insulin analogues Value drivers • Conversion from vials and syringes to devices 5% • Conve
Slide 15: The insulin business case – on regional basis
The insulin business case - on regional basis North America: Europe: • Analogue conversions 5% • Volume growth • Analogue conversions • Volume growth Japan & Oceania: • Device penetration • Volume growth + International Operations: • Conversion to • Volume growth disposable devices • Conversion to d
Slide 16: Insulin market US – continued market share gain
Insulin market US - continued market share gain • Fast-growing analogue Novo Nordisk’s market share market • Number of daily insulin 28% Trends and actions injections is increasing, but device penetration is still 25% modest • Increasing value market Value share post NovoLog® launch Volume 19% • Rec
Slide 17: Insulin market Europe – stable market share
Insulin market Europe - stable market share • 20% analogue conversion Novo Nordisk’s market share - and increasing • Conversion from durable to disposable pen Trends and actions • General focus on drug prices 58% • Insulin market volume growth above 5% 58% • Novo Nordisk’s total market share stabili
Slide 18: Insulin market Japan – competitive environment
Insulin market Japan - competitive environment • Continued strong volume growth Novo Nordisk’s market share • Disposable pens gaining market share • Challenging economic and financial environment Trends and actions • Continued roll-out of NovoRapid® • Continued penetration of InnoLet® and 83% FlexPe
Slide 19: International Operations – continued growth
International Operations - continued growth Novo Nordisk’s insulin sales • Diabetes growing at epidemic in International Operations rates – but lack of government 240 Trends and actions funding • Conversion from animal insulin to human insulin – and from vials to devices 100 Vials • Strong sales gro
Slide 20: Haemostasis management – strong growth continues
20 2 3 1 0 1998 DKK billion 5Y C 1999 AG R 5 2000 8% 2001 2002 Haemostasis management - strong growth continues Key observations • Sales +17% in 2002, +22% in local currencies • Growth driven by North America and International Operations • Increased penetration within current indication
Slide 21: NovoSeven – current business
NovoSeven® - current business Spontaneous bleedings in congenital haemophilia Key observations • Penetration increases as confidence in NovoSeven® Penetration increases • Increased treatment intensity Elective surgery and earlier onset of treatment within haemophilia • Increased confidence in electi
Slide 22: Low exposure to patent expiration
Low exposure to patent expiration Accumulated % of 2002 Novo % of 2001 sales with patents 40 Nordisk sales with patents 40 expiring in 2002-2006 35 expiring 35 30 30 25 25 20 20 15 15 10 10 5 5 0 0 Novo Nordisk 2003 2004 2005 2006 2007 2008 2009 2010 2011 Takeda Novartis Bayer GSK Pfizer Aventis Eli
Slide 23: The three core competences
The three core competences Diabetes expertise Protein expertise Drug delivery expertise • Biochemistry • Protein discovery • Protein formulation • Pharmacology • Genetic engineering • Device technology • Clinical development • Protein engineering, • External networks production and characterisation
Slide 24: R&D strategy – based on core competences
R&D strategy - based on core competences Protein ASIS balaglitazone Diabetes expertise expertise NovoSeven® insulin NN2501 expansion analogues AERx® iDMS NN414 hGH NN2211 expansion Protein Delivery System unit (PDS) Drug delivery expertise 24
Slide 25: Diabetes care update
Diabetes care update • Insulin detemir filed in the US, EU and six more countries + New proteins and concepts • Development of NN622 is + New superior OADs discontinued (eg NN414; NN2501) • Development of balaglitazone + Balaglitazone (NN2344) Value (NN2344) continues + NN2211 • Benefit/risk assessm
Slide 26: Diabetes care pipeline
Diabetes care pipeline Compound Type Indication Phase Insulin detemir (NN304) Insulin Type 1+2 diabetes Filed EU+US NovoMix® 50 and 70 Insulin Type 1+2 diabetes Phase 3 AERx® iDMS (NN1998) Insulin Type 1+2 diabetes Phase 3 Balaglitazone (NN2344) OAD Type 2 diabetes Phase 2 NN2211 GLP-1 analogue Type
Slide 27: Inhaled insulin project – in phase 3
Inhaled insulin project - in phase 3 HbA1c(%) reduction Key observations -0.74% -0.74% 9 • Breath check • AERx® iDMS allows precise one-unit increment dosing with 8.5 linear dose response HbA1c (%) • No increase in intra- and inter- 8 subject variability • No pulmonary changes in long- 7.5 term safe
Slide 28: Biopharmaceuticals – outside diabetes care
Biopharmaceuticals - outside diabetes care Life-cycle management • Phase 2 with ASIS* in acute + New areas respiratory distress + New indications syndrome (ARDS) initiated + New formulations • Growth hormone expansion + New devices programme Value + ASIS • EU approval is + NovoSeven® expansion expec
Slide 29: Biopharmaceuticals – pipeline outside diabetes care
Biopharmaceuticals - pipeline outside diabetes care Compound Indication Phase Growth hormone IUGR/SGA Filed in EU Growth hormone Complicated fractures Phase 2 NovoSeven® Hepatectomy Phase 2 NovoSeven® Liver transplantation Phase 2 NovoSeven® Trauma Phase 2 NovoSeven® Stem cell transplantation Phase
Slide 30: NovoSeven – the expansion programme
NovoSeven® - the expansion programme Elective surgery Bleeding in emergencies Intra-cerebral Liver haemorrhage transplantation Upper Trauma gastrointestinal Hepatectomy bleedings Stem cell transplantation General haemostatic agent 30
Slide 31: Increasing awareness – NovoSeven
Increasing awareness - NovoSeven® Patients enrolled in clinical Articles and abstracts* programmes 1500 7000 6000 Accululated number Accumulated number 5000 1000 4000 3000 500 2000 1000 0 0 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 1999 2000 2001 2002 * Source: Literature search in Medl
Slide 32: Pipeline reporting – development
Pipeline reporting - development Compound Indication Event Growth hormone IUGR/SGA Approval* H1 2003 NN2211 (GLP-1 analogue) Type 2 diabetes Phase 2 data NovoSeven® Hepatectomy in cirrhotics Phase 2 data NovoSeven® Liver transplantation Phase 2 data H2 2003 NovoMix® 50 and 70 Type 1+2 diabetes Filin
Slide 33: Sustainable growth
Sustainable growth Focus areas • Eco productivity • ISO 14100 implementation • Bioethics • Equal opportunities • Access to diabetes care 33
Slide 34: Financials
Financials 34 Diabotes isa silent killer. Itsignificantly increases the risk of cardiovascular disease, stioke and serious long-term complications. The need for answersis urgent, and Novo Nordisk is determined tofind ther. NovoNordisk is committed to creating long-term value for its shareholders. In
Slide 35: Financial results
Financial results Full year Fourth quarter DKK million 2002 2001 % change 2002 2001 % change Net turnover 25,187 23,776 6% 6,708 6,460 4% Operating profit 5,979 5,614 7% 1,605 1,484 8% Net financials 321 416 (23%) 198 82 141% Profit before tax 6,300 6,030 4% 1,803 1,566 15% Net profit 4,095 3,865 6%
Slide 36: Currency exposure
Currency exposure 2001 avg = 8.32 2002 USD Effect of 5% 8.5 avg = 7.88 appreciation on operating profit* (DKK million) 7.5 USD +160 JPY +130 6.5 GBP +75 2001 JPY * ie before hedging 5.5 avg = 6.85 2002 activities avg = 6.30 2001 2002 36
Slide 37: Shareholder value
Shareholder value Long-term financial targets In % 1998 1999 2000 2001 2002 Targets Operating profit growth 20.2 20.3 36.5 16.6 6.5 15 5Y CAGR +20% Operating margin 21.5 21.5 23.1 23.6 23.7 25 Cash to Earnings** N/A 48.4 66.5 56.4 34.9 60 ROIC 14.4 15.3 22.0 23.1 20.1 25 Cash to shareholders 3,000 D
Slide 38: Outlook for 2003
Outlook for 2003 • Operating profit will grow Key currency rates towards 5% DKK 2002 Current % per 100 average rate* change • Net financial items at DKK USD 788 681 -13 JPY 6.30 5.71 -10 600 million GBP 1182 1125 -5 • Tax rate of 34% * As of 5 February 2003 • Net profit to grow towards 10% Note: Abo
Slide 39: Key growth drivers
Key growth drivers Novo Nordisk sales* 25 • Leadership in diabetes care +% 20 13 G R CA • NovoSeven® expanding into Billion DKK 15 Y 13 general haemostasis 10 • Strong IP portfolio with low 5 exposure to patent 0 expirations 1989 1991 1993 1995 1997 1999 2001 * Since the merger between Novo and Nord
Slide 40: Investor Information
Investor Information Share information Investor Relations contacts Novo Nordisk A/S Novo Nordisk’s B shares are Investor Relations Novo Allé, DK2880 Bagsværd listed on the stock exchanges in Fax (+45) 4443 6633 Copenhagen and London. Its Peter Haahr ADRs are listed on the New York Tel (+45) 4442 12
Slide 41: Appendix slides
Appendix slides disk”
Slide 42: Sales by therapy
Sales by therapy DKK million 2002 2001 % of total % change (2002) Insulin etc 16,034 15,223 64 5 OAD* 1,631 1,401 6 16 Diabetes care, total 17,665 16,624 70 6 Haemostasis management 3,621 3,096 14 17 Growth hormone therapy 2,131 2,164 9 (2) HRT 1,342 1,435 5 (6) Other 428 457 2 (6) Total 25,187 23,7
Slide 43: Sales by region
Sales by region DKK million 2002 2001 % of total % change (2002) Europe 10,880 10,553 43 3 North America 5,913 5,277 24 12 Japan & Oceania 4,239 4,498 17 (6) International Operations 4,155 3,448 16 21 Total 25,187 23,776 100 6 43
Slide 44: Sales by therapy – currency impact
Sales by therapy - currency impact Full year Fourth quarter Diabetes care 11 Diabetes care 12 6 5 Haemostasis Haemostasis 22 management 25 management 17 17 Growth hormone Growth hormone -1 4 therapy -2 therapy -8 -5 -14 HRT -6 HRT -15 11 11 Total Total 4 6 -20 -10 0 10 20 30 40 -20 -10 0 10 20 30 40
Slide 45: Sales by region – currency impact
Sales by region - currency impact Full year Fourth quarter -1 Europe 4 Europe -2 3 18 25 North America 12 North America 13 2 0 Japan & Oceania -6 Japan & Oceania -9 International 34 International 44 Operations 21 29 Operations 11 11 Total 6 Total 4 sales sales -20 -10 0 10 20 30 40 -20 -10 0 10 20 3
Slide 46: Insulin sales in Europe – 'in-market' sales
Insulin sales in Europe - ‘in-market’ sales Growth compared to previous years ’In-market’ sales Q2 Q3 Q4 Q1 Q2 Q3 2001 2001 2001 2002 2002 2002 Total market growth: • Volume 9% 9% 9% 5% 4% 6% • Value 14% 11% 13% 9% 7% 9% Novo Nordisk growth: • Volume 9% 8% 9% 5% 4% 7% • Value 12% 9% 12% 10% 8% 9% No
Slide 47: European analogue conversion - NovoRapid
European analogue conversion - NovoRapid® Short-acting segment in Europe Share of short-acting segment Humalog market share 26.7%* Short-acting human insulin 46% NovoRapid® market share 14.6%* Short-acting insulin analogues Q4 1996 Q3 2002 Dec 2000 Nov 2002 Note: Data based on IMS 47
Slide 48: US analogue conversion - NovoLog
US analogue conversion - NovoLog® Short-acting segment in the US Share of short-acting segment Humalog market share 49.3%* Short-acting human insulin 54% NovoRapid® market Short-acting share 7.4%* insulin analogues Q4 1996 Q3 2002 Dec 2001 Nov 2002 Note: Data based on IMS 48
Slide 49: Launch of NovoMix 30 – still in progress
Launch of NovoMix® 30 - still in progress Sales development in Share of segment in Europe (MU) Europe (volume) 900 16% 800 14% 700 600 12% 500 10% 400 8% 300 NovoMix® 30 6% NovoMix® 30 200 NovoRapid® 4% NovoRapid® 100 LisproMix 25 2% LisproMix 25 0 0% 1 3 5 7 9 11 13 15 1 3 5 7 9 11 13 15 Quarters f
Slide 50: Novo Nordisk market share since Lantus launch
Novo Nordisk market share since Lantus launch Total Month of insulin Lantus November Germany (MU) launch 2002 50 USA 26% 28% 45 Volume share 40 Europe 57% 57% * 35 Basal Germany 44% 44% Premix Short-acting 30 UK 67% 67% Sep-01 Apr-02 Nov-02 * Oct-02 MS in the basal impacted by hoarding of Lantus in
Slide 51: Novo Nordisk regaining strength in Germany
Novo Nordisk regaining strength in Germany Germany, volume Germany, value 45 45 * * In sulin valu e share Insulin volume share 40 40 Novo Nordisk Novo Nordisk Aventis Aventis 35 35 * * 30 30 Sep 2001 Nov 2002 Sep 2001 Nov 2002 * Oct-02 MS impacted by hoarding of Lantus in anticipation of the Nov-02
Slide 52: Insulin segmentation – Europe and the US
Insulin segmentation - Europe and the US Europe US 50 50 Basal Premix 45 45 Short-acting 40 40 Volume share Volume share 35 35 30 30 25 25 20 20 Sep-01 Apr-02 Nov-02 Sep-01 Apr-02 Nov-02 Note: Data based on IMS 52
Slide 53: Insulin secretion in normal people and people with type 2 diabetes
Insulin secretion in normal people and people with type 2 diabetes 800 Insulin Secretion (pmol/min) 700 Normal Type 2 diabetes 600 500 400 300 200 100 0600 1000 1400 1800 2200 0200 0600 Source: O'MEARA et al. Am. J. Medicine, 1990; 89. 53
Slide 54: No weight gain with insulin detemir
No weight gain with insulin detemir p = 0.002 Change in weight (Kg) -1.7 Kg Insulin detemir (NN304) over 12 months NPH 1.5 1 Type 1 diabetes 0.5 0 -0.5 Body weight control with insulin detemir Source: E. Standl et al. Abstract number 467 ADA 2002 54
Slide 55: NovoMix provides improved postprandial control
NovoMix® 30 provides improved postprandial control p < 0.05 p < 0.0001 S-glucose excursion0-5h (mmol/l h) -10% -17% 25 20 15 10 5 0 lispromix 25 BIAsp 30 BHI 30 Source: Hermansen K et al. Diabetes Care 2002;25:883-888.
Slide 56: Faster haemostasis leads to...
56 FVIIa/NovoSeven® A bleeding episode Tissue factor Faster haemostasis leads to Advantages of NovoSeven® • Fewer transfusions / transfusion- free surgery • Reduced rebleeding • Faster recovery • Reduced morbidity and mortality • Improved quality of life
Slide 57: Growth hormone therapy – key observations
57 500 1000 1500 2000 2500 0 DKK billion 1997 1998 1999 2000 2001 2002 Growth hormone therapy Key observations • Sales decreased by 1% in local currencies in the fourth quarter as a result of lower sales in Japan • In Europe, North America and International Operations growth is driven by Norditropin
Slide 58: HRT – key observations
58 1200 1600 400 800 0 HRT DKK billion 1997 1998 1999 2000 2001 2002 Key observations • Sales in local currencies decreased by 14% in the fourth quarter • Sales in Europe decreased by 24%, reflecting increased parallel trading and lower overall demand for treatment with hormone replacement products