Galenica AG · SIX:GALE

Galenica — Investor Presentation (January 2021)

44 slides from Galenica's investor presentation, January 2021

1. Slide 1: Galenica Group Investor Presentation

   Galenica Group Investor Presentation January 2021 Galenica - the first choice for health, beauty and wellbeing

2. Slide 2: Agenda

   Agenda 1 History 3 2 Galenica at a glance 6 3 Business Sectors 8 4 Financial track record 13 5 Strategy and organisation update 15 6 Financial results H1 2020 23 7 Market update 35 8 Regulatory projects update 39 21.01.2021 © Galenica Group 2

3. Slide 3: Building the leading Swiss healthcare platform over 90 years

   1 Building the leading Swiss healthcare platform over 90 years Organic and Creation of Foundation of Acquisition of acquisition-led Amavita uniform Acquisition of Galenica as a Merfen® and expansion of brand in Bahnhof wholesaler Vita-Merfen® pharmacies network Switzerland Apotheke Acquisition of Ex

4. Slide 4: History of resilient growth and margin improvement

   1 History of resilient growth and margin improvement Logistics, HealthCare Information Galenica & Retail1,4 2009-19 2009–19 CAGRs sales CAGR 3.0% Retail market sales2 1.7% Galenica net sales 3.0% Galenica EBIT3 11.5% 2009-19 EBIT CAGR3 11.5% 6 3’165 3’301 6.0% 3’141 2’915 3’009 2’766 2’826 2’603 2’6

5. Slide 5: History of share price since IPO

   1 History of share price since IPO 75 70 CHF 59.45 Initial trade price 65 7 April 2017  CHF 43.00 60 IPO offer price 55CHF 39.00 50 45 40 35 15.01.21 30 7.4.2017 12/2017 12/2018 12/2019 12/2020 Galenica SPI 21.01.2021 © Galenica Group 5

6. Slide 6: Galenica is the leading healthcare provider in Switzerland

   2 Galenica is the leading healthcare provider in Switzerland 2019 net sales CHF3’301 million 2019 EBIT1 CHF167 million Health & Beauty Services Retail Products & Brands Market position2 #1 Consumer Health market position2 #1 Market position2 #1 2019 net sales 2019 EBIT 2019 net sales 2019 EBIT (pre

7. Slide 7: Operating in a stable and attractive Swiss healthcare market

   Operating in a stable and attractive Swiss healthcare market 2 with favourable long-term fundamentals Resilient, stable Swiss healthcare retail sector2 Pharmaceutical market in Switzerland (2019)1 CHF bn (based on ex-manufacturer price) 2019-23 CAGR 1.5%3 By value−CHF6.1bn By volume−187 million pack

8. Slide 8: The largest pharmacy retailer in Switzerland

   3 The largest pharmacy retailer in Switzerland Retail Network of chains (# of pharmacies as of 31 December 2020) Webshop Competitive positioning—#1 market position4 − Largest branded pharmacy network by By number of pharmacies5 Total # of pharmacies as of 2018 number of pharmacies in Switzerland  1

9. Slide 9: Ongoing pharmacy network consolidation and optimisation

   3 Ongoing pharmacy network consolidation and optimisation Retail  Proven track record of delivering synergies  Widely spread pharmacy network covers every through streamlining of business processes and Region in Switzerland creating value through acquisitions and network optimisation Marketing IT

10. Slide 10: Diversified product portfolio for health, beauty and wellbeing

    3 Diversified product portfolio for health, beauty and wellbeing Retail Galenicare’s retail product offering in % of sales1 12% 37% 18% 53% 17% 4% 12% Beauty Nutrition, Personal OTC medicines Prescription medicines and Patient Care of which originals of which generics 1 Sales YTD December 2019, incl

11. Slide 11: Leading role in Consumer Health with broad and innovative product portfolio

    Leading role in Consumer Health 3 with broad and innovative product portfolio Products & Brands Portfolio Competitive position: #1 Consumer Healthcare1 market position Consumer Health ORAL PAIN & Skincare brands REMEDIES5 Market share2 (%) No. 1 35% market share2 5.9 5.3 5.2 TOPICAL PAIN Exclusive p

12. Slide 12: Leader in pre-wholesale and wholesale distribution

    Leader in pre-wholesale and wholesale distribution, supported 3 by an innovative healthcare information business Services Services Competitive positioning - #1 market position1 − Pre-wholesale outsourced storage and distribution Pre-wholesale market share % Wholesale market share % − Logistics servi

13. Slide 13: Long-term track record of sustainable growth and attractive cash generation

    Long-term track record of sustainable growth and 4 attractive cash generation … Logistics, HCI & Retail1,4 Galenica 2009–19 CAGRs Retail market sales2 1.7% Galenica net sales 3.0% Net sales (CHFm) Galenica EBIT3 11.5% 3’141 6 3’165 3’301  Above market growth 2’826 2’915 3’009 2’603 2’661 2’766 2’46

14. Slide 14: Strong performance in both segments

    4 … demonstrating strong performance in both segments Health & Beauty Services Retail Health & Beauty Logistics and HCI Services 10.4% 4.0% 0.6% 2.4% Net sales (CHFm) 2’329 2’362 1 2’372 2’441 2’105 2’158 2’171 2’245 1’621 1’393 1’437 1’479 1 1’525 1’246 1’335 838 2009A … Health 2013A 2014A & Beauty

15. Slide 15: Galenica: The first choice for health, beauty and wellbeing

    5 Our ambition and self-perception Galenica: The first choice for health, beauty and wellbeing. 21.01.2021 © Galenica Group 15

16. Slide 16: Our Strategy - the power of Leverage

    5 Our Strategy - the power of 3 drives sustained value creation Products & Brands − Leverage leading positions to promote Develop and launch own and partner higher margin and exclusive products brands and products for pharmacies Leverage − Further expand and optimise retail 2017 2018 Retail network

17. Slide 17: Strategic frame and business model

    5 Strategic frame and business model 21.01.2021 © Galenica Group 17

18. Slide 18: Strategic Programmes

    Strategic Programmes 5  Implement strategy with focus and speed Strategic programmes Omni-Channel Market Care Focus Professionals Inside Efficiency Transformation 21.01.2021 © Galenica Group 18

19. Slide 19: Focus of the strategic programmes

    5 Focus of the strategic programmes Omni-Channel: Offer customers the best experience on all channels, anytime, anywhere. Market Care: Strengthen the role of pharmacies with healthcare offers and partnerships. Professionals: Strong partner for all stakeholders in the healthcare sector. Efficiency: S

20. Slide 20: Management structure Galenica Group

    5 Management structure Galenica Group * Executive Committee ** extended Executive Comittee 1) Joint venture with Coop Status: january 2021 21.01.2021 © Galenica Group 20

21. Slide 21: Executive Committee

    5 2 Executive Committee Marc Werner − CEO since 2020 CEO − 24 years industry experience − Joined Galenica in 2020 − Previously, Head Marketing & Sales division and Member of the Group Executive Board at Swisscom Felix Burkhard − CFO since 2017 CFO − 30 years industry experience of which 26 years at

22. Slide 22: Extended Executive Committee

    5 2 Extended Executive Committee Lukas Ackermann − Since 2021 Member of the Extended Executive Committee IT & Digital Services − 22 years health care experience − Joined Galenica in 2020 as Managing Director of HCI Solutions − Previously, General Manager of amétiq Ltd. Marianne Ellenberger − Since 2

23. Slide 23: H1 2020 Strong sales growth

    H1 2020 6 Strong sales growth Net sales (in CHF million) Galenica Group +5.6% Retail +2.9% Products & +1.0% Brands Services +7.9% H1 2019 H1 2020 21.01.2021 © Galenica Group 23

24. Slide 24: H1 2020 Retail Business sector

    H1 2020 6 Retail Business sector Net sales (in million CHF) +2.9% 48% Elements of growth: Expansion1): +5.6% +5.1% +4.3% thereof Bichsel Group: +3.2% Organic2): +0.4% -0.7% -1.4% thereof impact of price reductions3): -1.8% -1.9% -1.9% thereof one-time effect of process optimisation4): -1.3%  Estima

25. Slide 25: H1 2020 Products & Brands Business sector

    H1 2020 6 Products & Brands Business sector Net sales (in million CHF) +1.0% +14.0% International sales 53% -2.6% Sales in the Swiss market  New distribution of Bucco-Tantum®, Omni-Biotic®, launch of Veractiv® and discontinuation of distribution of Ginsana ® and Equazen® with +2.6% net impact on Sw

26. Slide 26: H1 2020 Services Business sector

    H1 2020 6 Services Business sector Net sales (in million CHF) +7.9% 49% impact of price reductions1): -2.3% -2.6% -1.8% One-time effect of adapted invoicing models2): +1.9%  Estimated impact of COVID-19 on sales: +3%  Growth of 5.9% in the pharmacy wholesale market (63% of net sales)  thereof 3.0

27. Slide 27: H1 2020 Solid results

    H1 2020 6 Solid results EBITDA (in million CHF) EBIT (in million CHF) +2.1% -0.6% 21.01.2021 © Galenica Group 27

28. Slide 28: H1 2020 EBITDA and EBIT adjustments

    H1 2020 6 EBITDA and EBIT adjustments1) EBITDA (in million CHF) EBIT (in million CHF) H1 H1 H1 H1 2019 2020 2019 2020 EBITDA 126.7 129.3 EBIT 82.8 82.3 Adjustment IAS 19 -0.3 2.4 Adjustment IAS 19 -0.3 2.4 Adjustment IFRS 16 -24.6 -26.4 Adjustment IFRS 16 -1.4 -1.1 EBITDA adjusted 101.8 105.3 EBIT a

29. Slide 29: H1 2020 EBIT growth despite negative COVID-19 impact

    H1 2020 6 EBIT growth despite negative COVID-19 impact EBIT and EBIT margin adjusted1) (in million CHF / %) 4.9% Galenica Group +3.0% 5.1% 7.7% Health & Beauty +2.5% 7.7% 1.8% Services -0.3% 1.9% 21.01.2021 © Galenica Group H1 2019 H1 2020 1) Excluding effects of IAS 19 and IFRS 16, Half-year Report

30. Slide 30: H1 2020 Financial result and taxes

    H1 2020 6 Financial result and taxes Financial result (in million CHF) Taxes (in million CHF) Tax rate excluding 3) one-time effects2) 18.2% 18.9% 17.0% -15.1 -13.6 -29.7 -15.1 -13.6 -8.4 -38.1 2019 H1 2019 H1 2020 Financial result adjusted 1) Taxes excluding one-time effects Effects of IAS19 and IF

31. Slide 31: H1 2020 Pleasing net profit growth

    H1 2020 6 Pleasing net profit growth (in million CHF) 125.3 +2.2% One-time effects of deferred taxes1) 64.9 66.3 Net profit comparable, adjusted2) and 134.2 excluding one-time effects of deferred taxes1) 65.0 68.4 +5.3% Effects of IAS19 and IFRS162) -8.4 -0.1 -2.1 -0.5 2019 H1 2019 H1 2020 1) Detail

32. Slide 32: H1 2020 Investments

    H1 2020 6 Investments (in million CHF) 1.6% 1.5% 1.6% % of net sales Investments in intangible assets Investments in tangible assets  COVID-19 has delayed the strategic efficiency projects in the Services business sector:  Replacement of the ERP system in Wholesale and Prewholesale - Duration of t

33. Slide 33: H1 2020 Solid free cash flow

    H1 2020 6 Solid free cash flow1) (in million CHF) H1 2019 H1 2020 Change Cash flow from operating activities before working capital changes 116.0 118.7 +2.7 Payment of lease liabilities -23.4 -24.4 Cash flow from operating activities before working capital changes adjusted 92.6 94.3 +1.7 Working cap

34. Slide 34: H1 2020 Solid balance sheet

    H1 2020 6 Solid balance sheet (in million CHF) Debt coverage1) 2.1x 2.6x 2.4x Debt coverage adjusted2) 1.5x 2.0x 1.9x Equity adjusted3) Effect of IFRS163) Net debt adjusted3) IAS19 and IFRS16 effects on equity3) 1) Net debt / EBITDA, Half-year Report 2020, page 33 2) Net debt adjusted / EBITDA adjus

35. Slide 35: Swiss pharmaceutical market by channel 2020

    7 Swiss pharmaceutical market by channel 2020 Value (ex-factory): CHF 6’331.7 million Volume (packs): 183.0 million CHF +176.9 million / +2.9% -3.3 million / -1.8% Hospitals Hospitals 9.1% 1’633.9 million 16.6 million 3.6% +3.1% -3.2% 25.8% Drugstores 43.3% Drugstores 67.5 million 6.6 million 22.5%

36. Slide 36: Swiss pharmaceutical market monthly development

    7 Swiss pharmaceutical market monthly development Value (ex-factory) 2020: CHF 6’331.7 million CHF +176.9 million / +2.9% Source: APO/SD/DRO/SPI Index, Swissmedic A, B, C, D Medicines Swissmedic lists A, B, C, D, sold from suppliers and wholesalers to hospitals, physicians and drugstores 21.01.2021

37. Slide 37: Consumer healthcare market YTD June 2020

    7 Consumer healthcare market YTD June 2020 3.5% OTC 12.8% +5.7% Personal CHF million care -5.2% 1’294 20.9% +3.9% Patient non-medication products +0.8% 62.8% care +10.4% Nutrition +6.5% Source: Pharma Trend for pharmacies and drugstores in Switzerland, streetprices 21.01.2021 © ©Galenica Group 2020

38. Slide 38: Generics growth (in volume) in the pharmacy channel 2020

    Generics growth (in volume) in the pharmacy channel 2020 Market with Total Packs reimbursable generics potential 76.9 million / +1.8% 5.7% by health insurance 56.2 million 21.2% Patent protected products 4.4 million / +12.6% -0.2% Products with expired patent 20.3 million / +2.2% 26.4% protection wi

39. Slide 39: Authorities: measures and projects

    8 Authorities: measures and projects Reduction in drug    2017 2018 2019 2020 prices Category changes of  2019 OTC products1) Distribution margin SBR IV extended until the end of 2021 SBR IV  SBR V Generics prices „Reference price from 2022? system“ 1) Swissmedic categories C, D 21.01.2021 © Ga

40. Slide 40: Price reduction rounds 2017 to 2019

    Price reduction rounds 2017 to 2019 8 Annual savings per channel at public and ex-factory price in million CHF 2017 2018 2019 225 44.6 185 41.0 64.8 Hospitals 122 118 52.4 13.4 101 Physicians 19.3 94 30.9 12.1 Pharmacies 33.2 17.1 24.6 25.9 116.1 91.3 78.0 64.6 65.5 51.4 Public price Publikumspreis

41. Slide 41: Reclassification of OTC's

    8 Reclassification of OTC’s Category A Category B Category C Category D Category E prescription without prescription pharmacy only pharmacy & drugstore sale in all shops repetition with a prescription with a prescription without prescription without prescription without prescribtion ~15% ~85% ~85% ~

42. Slide 42: Swiss Pharmaceutical market – composition of drug prices

    8 Swiss Pharmaceutical market – composition of drug prices Fixed margin elements help to offset price reductions Composition of the price of a prescription/ reimbursable drug: c.3/4 of the retail margin secured by fixed elements ~ 8 %1 LOA – Retail FOPH defines price and margin - Margin covers ~ 8%

43. Slide 43: Disclaimer

    Disclaimer Disclaimer Galenica Certain statements, beliefs and opinions in this presentation are forward-looking, which reflect the Company’s or, as appropriate, the Company’s directors’ current expectations and projections about future events. By their nature, forward-looking statements involve a n

44. Slide 44: Galenica Group - Contact information

    Galenica Group - Contact information Investor Relations Media Felix Burkhard Christina Hertig CFO Galenica Head Corporate Communication Tel.: +41 58 852 85 29 Tel.: +41 58 852 85 17 Mail: investors@galenica.com Mail: media@galenica.com 21.01.2021 © Galenica Group 44

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