H. Lundbeck A/S Class A · OMXCOP:HLUN_A
H. Lundbeck A/S Class A — Q3 2008 Earnings Presentation
56 slides from H. Lundbeck A/S Class A's earnings presentation, 2008
Slide 1: Investor presentation – H. Lundbeck A/S Q3 2008
Investor presentation – H. Lundbeck A/S Q3 2008
Slide 2: Safe Harbour Statement
Safe Harbour Statement This presentation contains forward-looking statements that provide our expectations or forecasts of future events such as new product introductions, product approvals and financial performance. Such forward-looking statements are subject to risks, uncertainties and inaccurate
Slide 3: Major events during Q3 2008
Major events during Q3 2008 Financials Lundbeck increases investments in R&D and is on track to deliver on its promises for 2008 Pipeline progression All late-stage projects are on track J Patient recruitment on Lu AA21004; Lu AA24530 and Lu AA34893 according to plan J By the end of 2008 the clinica
Slide 4: Lundbeck – a fully integrated company focusing exclusively on brain disorders
Lundbeck – a fully integrated company focusing exclusively on brain disorders 2007 CNS market Lundbeck focus USD 111.5 billion (+10%) Depression, N6A Psychosis, N5A 18% (-4%) CAGR of 12.5% 1990-2007 Alzheimer’s disease, N7D 20% (+14%) Parkinson’s disease, N4A 5% (+22%) Sleep, N5B 3% (+20%) 4% (-8%)
Slide 5: Lundbeck is involved in indications with high unmet medical needs
Lundbeck is involved in indications with high unmet medical needs Rank of disease burden*) Disease area Products and pipeline projects #2 Unipolar depressive Cipralex®/Lexapro®; disorder + anxiety Lu AA21004 (ph3); Lu AA24530 (ph2); Lu AA34893 (ph2) #7 Cerebrovascular disease Desmoteplase (ph3); Lu
Slide 6: Focus and flexibility address future healthcare environment
Focus and flexibility address future healthcare environment The traditional business model is Lundbeck has >50 years of experience likely to change in CNS Increased price pressure Focused strategy in the value chain J Reality in EU – emerging in US? Flexible organisation The Health Care Payers NOT t
Slide 7: Lundbeck's aspiration to be a high-growth, research based, CNS company
It's Lundbeck’s aspiration to be a high-growth, research based, CNS company Leverage on CNS capabilities to develop novel compounds to address unmet medical Successful product needs launches Implement strategy to Potential launch of: maximise shareholder - Lu AA21004 value in 2011-14 - Lu AA34893 (m
Slide 8: Addressing unmet medical needs
Addressing unmet medical needs Lundbeck’s emerging Indication Biggest unmet needs compounds Depression/bipolar/ - Improved efficacy – lower remission rates Lu AA21004; Lu AA24530; PTSD/anxiety - Faster onset of action+less side effects Lu AA34893 Psychosis/bipolar - Improved maintenance therapy Serd
Slide 9: Depression and anxiety – efficacy and onset of action needs improvement
Depression and anxiety – efficacy and onset of action needs improvement Efficacy The prevalence of depression, anxiety and Only some 50- mixed anxiety/depression ranges from 7-22% 60% of patients in Western societies respond to US being in the high end therapy 150m people suffer from depressio
Slide 10: Lundbeck's portfolio within mood disorders potentially addresses unmet medical needs
Lundbeck’s portfolio within mood disorders potentially addresses unmet medical needs Portfolio of three innovative novel Clinical programme: compounds Clinical phase III programme with Lu AA21004 Lu AA21004 recruiting 4,000+ patients initiated in December 2007 Lu AA34893 No additional clinical
Slide 11: Lu AA21004 enters a huge market and addresses unmet medical needs
Lu AA21004 enters a huge market and addresses unmet medical needs The world-market for anti- Lu AA21004 offers depressants is a USD 20bn Pharmacological profile different from opportunity current antidepressants J Most prescribed therapeutic Increases multiple neuro-transmitters category in the
Slide 12: Lu AA21004 – Receptor profil
Lu AA21004 – Receptor profil SSRI 5HTT OCU-R: 80% Serotonin Lu AA21004 Serotonin 5HTT OCU-R: 40% Noradrenaline Dopamine 5HT3 Acetylcholine 5HT1A 12
Slide 13: Psychosis – major unmet medical needs
Psychosis – major unmet medical needs Need for several therapies when treating schizophrenia Schizophrenia affects about 24m people worldwide 7% 2% More than 50% of persons with schizophrenia USA 32% 40% 20% are not receiving appropriate care ~50% in EU and ~70% in the US receives more than on
Slide 14: Lundbeck has a portfolio of compounds to treat psychosis
Lundbeck has a portfolio of compounds to treat psychosis Portfolio approach also in psychosis Clinical programme: Sertindole (US) NDA Additional clinical phase II programme Bifeprunox with Lu 31-130 recruiting 120 patients Lu 31-130 initiated in September 2007 Lu AA39959 To explore the efficacy
Slide 15: Serdolect has market potential in the US
Serdolect® has market potential in the US NDA submitted in September Complete response letter Efficacy against positive and J expected in May 2009 negative symptoms The US anti-psychotics market is Low rate of suicide and valued at USD 12.6bn per year all-cause mortality J Annual growth of around 12
Slide 16: Bifeprunox – additional clinical phase III trials initiated
Bifeprunox – additional clinical phase III trials initiated Clinical trial design Bifeprunox Two clinical phase III trials; each enrolling 450 target population patients with schizophrenia inadequately controlled in the maintenance phase The primary objective of the programme is to Severity of s
Slide 17: Lu 31-130: Development status and immediate plans
Lu 31-130: Development status and immediate plans Lu 31-130 has a multi-receptorial profile J With high to medium affinities to dopaminergic, serotonergic and H1 histaminergic receptors J Potent in-vivo antagonistic effects at D1, D2, and 5-HT2a receptors J Unique preference for D1 over D2 Lu 31-130
Slide 18: Stroke is an immature market with huge unmet medical needs
Stroke is an immature market with huge unmet medical needs Disease management Around 600,000 cases annually in the US 15% 12% Ischaemic 20% Before 3 hours Third leading cause of death Haemorrhagic Betw een 3-9 hours Leading cause of long-term After 9 hours 88% disability 65% One of the most co
Slide 19: Desmoteplase (ph III) – a possible improvement of existing stroke therapy
Desmoteplase (ph III) – a possible improvement of existing stroke therapy Responder rates Nine hour time window increases addressable DIAS/DEDAS DIAS-2 (pooled) market to approx. 80% (from approx. 15%) 50% Potential to decrease bleeding complications Potential to improve neurological outcome 4
Slide 20: Alcohol misuse – an un-developed market due to non-compliance
Alcohol misuse – an un-developed market due to non-compliance and lack of effective agents Medication An estimated 50m people is defined as alcohol misusers in major markets -Ineffective -Side effects More than 80% of prevalent population is undiagnosed -Complex -Cost Only around 13% of diagno
Slide 21: Nalmefene (ph III) – a potential new treatment paradigm
Nalmefene (ph III) – a potential new treatment paradigm In clinical trials nalmefene reduces J Heavy Drinking Days Heavy Drinking Days per month J Total consumption 15 Nalmefene can leverage on Lundbeck’s existing European GP and specialist sales force J Co-morbidity to other psychiatric disorders 1
Slide 22: The broadest late-stage pipeline in company history
The broadest late-stage pipeline in company history Indication Development step Registration Expected Compound Activity Phase I Phase II Phase III application launch Schizophrenia Dopamine/ Serdolect® (US) serotonin Filed 2009 Schizophrenia Dopamine/ Bifeprunox serotonin 2010+ Stroke Desmoteplase Pl
Slide 23: Cipralex - continued solid performance in Europe
Cipralex® - continued solid performance in Europe Antidepressant market Europe Market share, value – market growth, volume Cipralex® is the most frequently 20% combined 18.7% 20% prescribed branded anti-depressant in Europe Cipralex® 16.1% 15% 15% Cipralex® is approved for depression, panic diso
Slide 24: Cipralex / Lexapro - strong underlying growth in International Markets
Cipralex® / Lexapro® - strong underlying growth in International Markets International markets Market share, value – market growth, volume Second most prescribed anti- 20% 20% depressant in International Markets Strong growth rates despite generic 15% 15% competition in many markets combined 12.
Slide 25: Lexapro - maintaining branded market position in US
Lexapro® - maintaining branded market position in US Antidepressant market USA Market share, value – market growth, volume Lexapro® is the most prescribed 25% combined 23.1% 25% branded antidepressant in the US 20% 20% Marketed by Forest Laboratories, Lexapro® 22.9% Inc. 15% 15% Approved for t
Slide 26: Ebixa (memantine) – second most prescribed anti-Alzheimer's product in Europe
Ebixa® (memantine) – the second most prescribed anti-Alzheimer’s product in Europe Anti-Alzheimer’s market Ebixa® is the only NMDA receptor Europe antagonist approved for the treatment Market share, value – market growth, volume of Alzheimer’s disease 30% 20% combined 23.8% Approved for the trea
Slide 27: Ebixa (memantine) – the leading Alzheimer's medication in Latin America
Ebixa® (memantine) – the leading Alzheimer’s medication in Latin America Anti-Alzheimer’s market International markets Market share, value – market growth, volume 15% 45% Ebixa® is the only NMDA receptor combined 13.2% antagonist approved for the treatment Alzheimer’s disease 10% 30% Ebixa® 10.9%
Slide 28: Azilect – the success continues
Azilect® – the success continues Anti-Parkinson’s market European market share continues to Europe increase now having close to 6% of the Market share, value – market growth, volume market 6% 5% Azilect® by Lundbeck in more than 20 Azilect® 5.6% countries in Europe and International 5% 4% Market
Slide 29: Insomnia is still a market with unmet medical needs
Insomnia is still a market with unmet medical needs Disorders co-morbid with insomnia Insomnia: (Patients visiting physician with sleep problems and co-morbid condition (%) 70 million adults suffer from insomnia – 100% 25 million with chronic and/or severe Specialists GPs insomnia 80% The preval
Slide 30: Roll-out of Circadin initiated in May in Europe
Roll-out of Circadin® initiated in May in Europe – initial feedback is positive Circadin® in Europe: Lundbeck has rights for approx. 80% of the European market (approx. USD 800m) Indicated as monotherapy for the short-term treatment of primary insomnia in patients aged 55+ Fits well into Lundb
Slide 31: Financial figures – distribution of revenue in Q3 2008
Financial figures – distribution of revenue in Q3 2008 As percentage of total revenue Lundbeck’s underlying business posted 1% 14% Cipralex® (+17%) revenue growth of 6% in Q3 2008 0.5% Lexapro® (-14%) 2% 44% Ebixa® (+11%) Sales of Cipralex® and Azilect® were up by 21% and 42%, respectively, at 17% A
Slide 32: Financial figures – distribution of costs in Q3 2008
Financial figures – distribution of costs in Q3 2008 Costs and EBIT as percentage of revenue Q3 2008 Q3 2007 Growth excl. one-off 16% Revenue 2,810*) 2,743 +2% 30% CoGS 432 457 -5% 20% Distribution 571 584 -2% costs Administrative 386 358 +8% expenses 20% 14% R&D 567 485 +17% CoGS Distribution costs
Slide 33: Key deliverables the next 12 months
Key deliverables the next 12 months Existing products J Life-cycle management initiatives for escitalopram J File Serdolect® in the US for schizophrenia √ J Defend exclusivity and IP rights vigorously if challenged J Expanded opportunities for Azilect® following ADAGIO Product launches J Circadin® i
Slide 34: Financial guidance
Financial guidance 2007 actual 2008 guidance DKK 10,565 million Revenue DKK 11-11.5 billion DKK 2,657 million EBIT DKK 2.8-2.9 billion Approx. DKK 739 million Capex DKK 500 million Numbers are excluding one-off items Capex is excluding in-licensing and milestone payments 34
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Slide 36: For more information please contact Investor Relations
For more information please contact Investor Relations Jacob Tolstrup Palle Holm Olesen Joan Loua Director; IR and Communication Head of Investor Relations Investor Relations coordinator Tel: +45 36 43 30 79 Tel: +45 36 43 24 26 Tel: +45 36 43 45 98 Fax: +45 36 43 82 62 Fax: +45 36 43 82 62 Fax: +45
Slide 37: Lundbeck share
Lundbeck share Share information: Trading code: Free float (approximately 60m Reuters (LUN.CO) / Bloomberg (LUN DC) ISIN Number DK0010287234 shares) is traded 2+ times over Unsponsored ADR programmes annually (daily trade of HLUKY, CUSIP 40422M107 approximately 0.7m) Index examples: End of
Slide 38: Revenue – by product / by region
Revenue – by product / by region International Total Europe USA Markets Q3 Q3 Q3 Q3 Q3 Q3 Q3 Q3 DKKm 2008 2007 2008 2007 2008 2007 2008 2007 Total revenue 2,810 2,960 1,559 1,408 602 701 608 569 Growth -5% 11% -14% 7% Cipralex® 1,228 1,046 844 728 - - 384 318 Growth 17% 16% 21% Lexapro® 602 699 - -
Slide 39: Revenue, 5 year figures
Revenue, 5 year figures Revenue, DKK million Growth, Y/Y, % 2003 2004 2005 2006 2007 2004 2005 2006 2007 Total revenue 9,941 9,733 9,070 9,221 10,985 -2% -7% 2% 19% Cipralex® 645 1,661 2,625 3,508 4,094 157% 58% 34% 17% Lexapro® 1,928 2,420 2,552 1,923 2,594 26% 5% -25% 35% Ebixa® 286 722 1,105 1,36
Slide 40: Revenue, quarterly figures
Revenue, quarterly figures Revenue, DKK million Growth, Y/Y, % Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2007 2008 2008 2008 2007 2008 2008 2008 Total revenue 2,830 2,882 2,938 2,810 11% 12% 12% -5% Cipralex® 1,031 1,216 1,234 1,228 10% 23% 20% 17% Lexapro® 626 661 692 602 19% 5% 8% -14% Ebixa® 422 457 467 480 13% 17
Slide 41: Costs, 5 year figures
Costs, 5 year figures DKK million Growth, Y/Y, % 2003 2004 2005 2006 2007 2004 2005 2006 2007 Revenue 9,941 9,733 9,070 9,221 10,985 -2% -7% 2% 19% Production costs 1,758 1,725 1,488 1,646 2,198 -2% -14% 11% 34% Distribution costs 2,478 2,302 2,337 2,419 2,409 -7% 2% 4% 0% Administrative exp. 1,612
Slide 42: Costs, quarterly figures
Costs, quarterly figures DKK million Growth, Y/Y, % Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2007 2008 2008 2008 2007 2008 2008 2008 Revenue 2,830 2,882 2,938 2,810 11% 12% 12% -5% Production costs 846 476 469 432 103% -4% 18% -5% Distribution costs 657 567 632 571 -4% -2% 7% -2% Administrative expenses 395 399 427
Slide 43: Lundbeck hedge the USD on a rolling basis around 12 months ahead
Lundbeck hedge the USD on a rolling basis around 12 months ahead – 2008 USD hedge rate of 5.33 Actual rates Forward rates 10 9 8 7.90 7 6.68 6.00 6 5.89 5.75 5 5.11 4.89 5.23 4.85 Quarterly figures 4 '04 '05 '06 '07 '08 Q4 Q1 Q2 Q3 '08 '09 '09 '09 Average US$ exchange rate Average hedging US$ rate N
Slide 44: Lundbeck recognition of income from Forest
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 in delivery at expected
Slide 45: Depression: Cipralex / Lexapro - best-in-class
Cipralex® / Lexapro® - best-in-class Comparator Presented Main outcome Venlafaxine XR SCNP, April 2003 Escitalopram was at least as effective and was better tolerated than (Effexor) venlafaxine XR.Escitalopram treated patients reached sustained response and remission significantly faster. Venlafaxin
Slide 46: Anxiety: Cipralex / Lexapro - best-in-class
Cipralex® / Lexapro® - best-in-class Comparator Presented Main outcome Paroxetine SCNP, April 2003 Escitalopram was significantly superior to paroxetine after 24 weeks of (Paxil) treatment of SAD and showed fewer discontinuation effects. Anxiety Paroxetine ACNP, December 2003 Escitalopram was as eff
Slide 47: Global IP position
Global IP position Europe Bifeprunox: Compound patent in majority of countries to Feb. 2017 (excl. extension) Escitalopram: Compound patent in majority of countries to May-June 2014. Process patent in majority of countries to June 2014 Memantine: Data exclusivity until 2012; use patent until 2014 (i
Slide 48: Worldwide pharmaceutical market 2007 USD 668.8 billion (+10%)
Worldwide pharmaceutical market 2007 USD 668.8 billion (+10%) 7%(+9%) 3%(+11%) 17%(+11%) 5%(+10%) (N) CNS 5%(+12%) (C) Cardiovascular (A) Alimentary (J) Anti-Infectives 6%(+5%) 15% (+3%) (L) A+Immun (R) Respiratory (B) Blood 8%(+18%) (M) Muscolo-Skeletal (G) G.U.& Sex Hormones (D) Dermatologicals Ot
Slide 49: Worldwide CNS market 2007 USD 111.5 billion (+10%)
Worldwide CNS market 2007 USD 111.5 billion (+10%) 11%(+23%) 20%(+14%) 2%(+5%) N5A Antipsychotics 2%(+5%) N6A Antidepressants 3%(+8%) N3A Anti-Epileptics N2B Non-Narcotic Analgesics 3%(+20%) N2A Narcotic Analgesics 4%(-8%) N7D Anti-Alzheimers 18%(-4%) N5B Hypnotics & Sedatives N4A Anti-Parkinson's 5
Slide 50: Alzheimer's (N7D-2007) – USD 5.6 billion (+21%)
Alzheimer’s (N7D-2007) – USD 5.6 billion (+21%) International markets Value Market Shares of N7D 16% (+28%) Europe M12 2007 USA M12 2007 Rivastigmine Memantine Europe 30% (+23%) North Galantamine America 54% (+19%) Donepezil 0% 10% 20% 30% 40% 50% 60% Source: IMS Health, May 2008, retail only Leadin
Slide 51: Anti-depressants (N6A-2007) – USD 19.8 billion (-4%)
Anti-depressants (N6A-2007) – USD 19.8 billion (- 4%) International Value Market shares of N6A markets 14% (+16%) VENLAFAXINE SERTRALINE PAROXETINE North FLUOXETINE Europe M12 2007 Europe America USA M12 2007 ESCITALOPRAM 25% (+10%) 61% (-12%) DULOXETINE CITALOPRAM BUPROPION 0% 5% 10% 15% 20% 25% 30
Slide 52: Anti-psychotics (N5A-2007) – USD 20.8 billion (+14%)
Anti-psychotics (N5A-2007) – USD 20.8 billion (+14%) International Value Market Shares of N5A markets Europe M12 2007 10% (+17%) ZIPRASIDONE USA M12 2007 RISPERIDONE QUETIAPINE Europe 24% (+20%) OLANZAPINE CLOZAPINE North America ARIPIPRAZOLE 65% (+12%) AMISULPRIDE 0% 5% 10% 15% 20% 25% 30% 35% Sour
Slide 53: Anti-Parkinson's (N4A - 2007) – USD 3.7 billion (+19%)
Anti-Parkinson’s (N4A - 2007) – USD 3.7 billion (+19%) Value Market Shares of N4A - Europe International North Europe M12 2007 markets America Stalevo® 21% (+8%) 36% (+23%) NMDA ANTAGONISTS MAOI LEVODOPA DERIVATE DOPAMINE AGONISTS COMT INHIBITORS ANTICHOLINERGICS 0,00% 10,00% 20,00% 30,00% 40,00% 50
Slide 54: Hypnotics (N5B-2007) – USD 5.0 billion (-8%)
Hypnotics (N5B-2007) – USD 5.0 billion (- 8%) Value Market Shares of N5B International Europe Q4 2007 markets Ezopiclone USA Q4 2007 17% (+4%) Zaleplon Zopiclone Europe North 22% (+12%) America Zolpidem 61% (-16%) 0% 10% 20% 30% 40% 50% 60% 70% 80% Source: IMS Health, May 2008, retail Leading produc
Slide 55: Stroke, Fibrinolytics (B1D - 2007) – USD 735 million (+9%)
Stroke, Fibrinolytics (B1D - 2007) – USD 735 million (+9%) International markets 19% (+12%) North America 49% (+6%) Europe 32% (+11%) Leading product Marketing Corporation Sales 2007 (USDm) Growth in % Activase®/Actilyse® Roche/Boehringer 270 21 Metalyse®/Tnkase Roche/Boehringer 166 (1) Retavase®/Ra
Slide 56: Alcohol (N7E-2007) – USD 171 million (+23%)
Alcohol (N7E-2007) – USD 171 million (+23%) International markets 11% (-5%) North America 36% (+47%) Europe 53% (+13%) Leading product Marketing Corporation Sales 2007 (USDm) Growth in % Campral® Merck 74 11 Antabuse® Barr/Sanofi-Aventis 26 48 Nemexin® BMS/Cephalon 11 7 Vivitrol® Alkermes/Cephalon 1