West Pharmaceutical Services, Inc. · NYSE:WST
West Pharmaceutical Services — UBS Global Life Sciences Conference 2011
27 slides from West Pharmaceutical Services's conference presentation, Sep 19, 2011
Slide 1: West Pharmaceutical Services, Inc.
WEST PHARMACEUTICAL SERVICES, INC. Solutions for Injectable Drug Delivery NYSE:WST www.westpharma.com © 2011 by West Pharmaceutical Services, Inc., Lionville, PA. All rights reserved. This material is protected by copyright. No part of it may be reproduced, stored in a retrieval system, or transmitt
Slide 2: Safe Harbor Statement
Safe Harbor Statement Cautionary Statement Under the Private Securities Litigation Reform Act of 1995 This presentation and any accompanying management commentary contain “forward-looking statements” as that term is defined in the Private Securities Litigation Reform Act of 1995. Such statements inc
Slide 3: Pharmaceutical Packaging Systems and Delivery Systems
Pharmaceutical Packaging Systems Pharmaceutical Delivery Systems • A globally diverse manufacturer of products used primarily in containing and administering small-volume parenteral drugs. • Strong competitive position – Substantial market shares – Proprietary technology – Diversified customer base
Slide 4: Sales
Sales ($ in millions) Compound annual growth rate: 4.9% (4.3% ex-currency)
Slide 5: Business Segments
$785 Packaging Systems Business Segments $324 2010 Revenues ($ millions) Delivery Systems • Contract manufacturing base • Multi-material • Project management • Automated assembly • Regulated products • Capabilities + IP = proprietary delivery devices • Proprietary devices are expected to drive growt
Slide 6: Business Environment
Business Environment • Economic Recovery: Slowing or Double-dip – Effects of weakness on private and public healthcare spending – Implications of EU sovereign debt situation – Developing economies growing (e.g., China, Brazil, India) • Persistent Fx and commodity price volatility • Trends in Pharmac
Slide 7: A Diverse, Stable Customer Base
PHARMACEUTICAL / BIOTECHNOLOGY GENERIC MEDICAL DEVICE A Diverse, Stable Customer Base (representative healthcare customers)
Slide 8: What Will Drive Growth?
• Company – Demographics and increasing prevalence of chronic disease – Increasing use of biologics to treat those – Broader access to healthcare • Packaging Systems Segment – Growth in emerging markets – Products and processes to satisfy escalating regulatory and quality expectations • Delivery Sys
Slide 9: Therapeutic Category Growth Drivers
Category Key Customers Projected Growth Diabetes > 10 % Oncology > 10 % Vaccines > 10 % Autoimmune > 8% Generics >10% IMS April 2010 Report; Business Insights 2009; GBI Research 2009 Therapeutic Category Growth Drivers
Slide 10: Pharmaceutical Packaging Systems
Pharmaceutical Packaging Systems Packaging Components for Small Volume Parenterals Plungers, Tip caps, Needle shields for Glass Syringes Plungers, lined seals for Glass Cartridges for Pens Primary packaging components (those that touch the drug) are typically proprietary to West and are “designed in
Slide 11: Packaging Systems Segment Growth Strategy
Packaging Systems Segment • Increase per-unit value • Continued growth of prefilled syringes • Improve operating efficiency: lean operations • Geographic expansion - capacity investments in Asia • Strategic acquisitions and partnerships Growth Strategy
Slide 12: Revenue Opportunity per Unit
Standard High-Value Products Products Revenue Opportunity ($ per unit) Plungers and sleeve stoppers Stoppers Seals RU seals Westar ® RU
Slide 13: Faster Growth of High-Value Products
Faster Growth of High-Value Products Pharmaceutical Packaging Systems
Slide 14: Key High-value Products
Pharmaceutical Packaging Systems Key High-value Products • Westar ® RS (ready-to-sterilize) and Westar ® RU (ready-to-use) components • Barrier film coatings (FluroTec ® , Teflon ® coated) enhance drug- product stability – Key feature for biotech products • B-2 and LyoTec ® coatings for enhanced han
Slide 15: Delivery Systems
Delivery Systems West ConfiDose ® auto-injector system Daikyo Crystal Zenith Life-cycle Containment Solutions SmartDose™ electronic patch injector system West MixJect ® and Vial2Bag ® Custom Manufacturing of Components and Devices Proprietary Components, Devices and Systems
Slide 16: Delivery Systems Segment Growth Strategy
Delivery Systems Segment • Realize commercial potential of CZ • Leverage life-cycle management opportunities • Develop new platform opportunities - combination products • Custom solution provider Growth Strategy
Slide 17: Effect of Increasing Proprietary Device Sales
Revenue per-unit Consumer product manufacturing Medical device manufacturing Mix2Vial ® CZ vials CZ Syringes ConfiDose ® Effect of Increasing Proprietary Device Sales Contract Manufacturing Proprietary Devices Products SmartDose™
Slide 18: Concerns With Glass Syringes
Concerns With Glass Syringes • Interaction with sensitive biologics • Protein aggregation (silicone oil) • Residual chemicals (tungsten, glue) • Glass flakes • Dimensional variation • Variable silicone distribution • High Cost of Quality • Breakage • In process/handling • Within auto-injector system
Slide 19: Daikyo CZ Solution
Daikyo CZ Solution with Daikyo FluroTec ® • Reduces: – drug exposure to extractables – risk of protein aggregation caused by silicone oil in the drug product – returns and in-process clean-ups caused by broken glass – risk of delamination and glass-particulate contamination • Consistent piston relea
Slide 20: Pharma Industry Drug Life-Cycle Management
Phase I Phase II Phase III Post-Market Life Cycle Management Pharma Industry Drug Life-Cycle Management 8 - 10 years 2 - 3 years 2 - 3 years Regulatory Approval Discovery
Slide 21: SmartDose Electronic Patch Injector
Programmed by PDA or PC Dose may be customized Applied and activated by patient SmartDose ™ Electronic Patch Injector • Controlled, subcutaneous, micro-infusion delivery of high volumes and high viscosity drugs • Prefilled cartridge, no need for user filling • Based on Daikyo CZ cartridge • Compact
Slide 22: New Product Commercialization
New Product Commercialization Schematic representation of order and timing of West & Customer activities Commercial Sales: Rx product approval and launch (new product) Production using new West product Commercial Production 1 2 4 5 6 Approximate timing (years)
Slide 23: Our Long-Term Focus
Our Long-Term Focus • Pharmaceutical Packaging Systems – Organic growth of 3-5% per year – Margin expansion from efficiency, product mix – Capital investments target enhanced quality and value • Pharmaceutical Delivery Systems – Deliver the potential of Daikyo CZ products – Stronger mix of healthcar
Slide 24: Selected Financial Information
($ millions) June 30, 2011 December 31, 2010 Cash and cash equivalents $110.4 $110.2 Debt $373.5 $358.4 Equity $696.0 $625.7 Net debt to total invested capital 27.4% 28.4% Working capital $317.7 $266.9 Selected Financial Information • Balance Sheet • Dividend – Most recent quarter: $0.17 ($0.68 annu
Slide 25: Summary Second Quarter Results
Three Months Ended June 30, 2011 2010 Net Sales $ 307.9 $ 281.8 Gross Profit 84.6 83.2 Reported Operating Profit 27.8 30.5 Adjusted Operating Profit (1) 30.5 30.9 Reported Diluted EPS $ 0.57 $ 0.62 Adjusted Diluted EPS (1) $ 0.62 $ 0.64 Summary Second Quarter Results $ millions, except per-share dat
Slide 26: Summary
Pharmaceutical Packaging Systems Pharmaceutical Delivery Systems • Strong competitive position – Substantial market shares – Proprietary technology – Diversified customer base – Global footprint – Preferred products for biologics – Long-term customer relationships • Stability with growth potential •
Slide 27: Components manufactured by West and global partners
On average, approximately 100 million components manufactured by West and our Global Partners are used to enhance the quality of healthcare worldwide everyday. Global Partners with Daikyo Seiko, Ltd. and West Pharmaceutical services Mexico, S.A. de C.V.
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