H. Lundbeck A/s Class A · OMXCOP:HLUN_A
H. Lundbeck A/s Class A — Q2 2008 Earnings Presentation
53 slides from H. Lundbeck A/s Class A's earnings presentation, Nov 15, 2008
Slide 1: Investor presentation – H. Lundbeck A/S Q2 2008
Investor presentation – H. Lundbeck A/S Q2 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 Q2 2008
Major events during Q2 2008 Financials Continued solid growth in all our products and regions Pipeline progression Additional phase II study with Lu AA34893 in major depression to be initiated in August (600 patients) Following disappointing results from Myriad’s phase III programme using Flurizan®
Slide 4: Lundbeck – a fully integrated company focusing exclusively on CNS
Lundbeck – a fully integrated company focusing exclusively on CNS 2007 CNS market USD Lundbeck focus 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%) Alcohol depe
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 AA37096 (ph1) #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: It's 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; Lu AA37096 Psychosis/bipolar - Improved maintenance
Slide 9: Depression and anxiety – efficacy and onset of action needs improvement
Depression and anxiety – efficacy and onset of action needs improvement Efficacy Major Depressive Disorder (MDD) is the Only some 50- leading cause of disability in the US and 60% of patients established market economies worldwide respond to therapy WHO estimates 150 million people (higher for e
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 four innovative novel Clinical programme: compounds Lu AA21004 Clinical phase III programme with Lu AA34893 Lu AA21004 recruiting 4,000+ patients initiated in December 2007 Lu AA24530 Lu AA37096 N
Slide 11: Lu AA21004: a novel profile
Lu AA21004: a novel profile Mixed 5-HT3 receptor antagonist, 5-HT1A receptor partial agonist, 5-HT enhancer Lu AA21004: Increases 5-HT levels in regions of the brain associated with mood disorders Increased ACh, NA, DA and 5-HT in key regions for mood regulation 2000 500 Different from SSRIs 5
Slide 12: 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 13: 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 Explorative clinical phase II programme Bifeprunox with Lu 31-130 recruiting 210 patients Lu 31-130 initiated in March 2007 Lu AA39959 Additional clinical phase I
Slide 14: 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 15: 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 16: 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 DIAS/DEDAS DIAS-2 (pooled) addressable market to approx. 80% 50% (from approx. 15%) Potential to decrease bleeding 40% complications Potential to improve neurological 30% o
Slide 17: Alcohol misuse – an un-developed market due to non-compliance and lack of effective agents
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 18: Nalmefene (ph III) – a potential new treatment paradigm
Nalmefene (ph III) – a potential new treatment paradigm Heavy Drinking In clinical trials nalmefene reduces Days per month J Heavy Drinking Days 15 J Total consumption Nalmefene improves 10 J Clinical global impression Nalmefene can leverage on Lundbeck’s * existing European GP and specialist 5 sale
Slide 19: The broadest pipeline in company history
The broadest pipeline in company history Indication Development step Registration Expected Compound Activity Phase I Phase II Phase III application launch Schizophrenia Dopamine/ Serdolect US serotonin 2008 2009 Schizophrenia Dopamine/ Bifeprunox serotonin 2010+ Stroke Desmoteplase Plasminogen activ
Slide 20: 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 18.5% 20% prescribed branded anti-depressant in Europe Cipralex® 15.9% 15% 15% Cipralex® is approved for depression, panic diso
Slide 21: Cipralex® / Lexapro® - strong underlying growth in International Markets
Cipralex® / Lexapro® - strong underlying growth in International Markets International markets Market share, value – market growth, volume 20% 20% Second most prescribed anti- depressant in International Markets 15% 15% combined 12.9% Strong growth rates despite generic competition in many marke
Slide 22: 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 22.8% 25% branded antidepressant in the US 20% 20% Marketed by Forest Laboratories, Lexapro® 22.6% Inc. 15% 15% Approved for t
Slide 23: Ebixa® – the 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 Europe Ebixa® is the only NMDA receptor Market share, value – market growth, volume antagonist approved for the treatment 25% combined 23.4% 30% of Alzheimer’s disease Approved for the trea
Slide 24: Ebixa® – 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® 11.1%
Slide 25: Azilect® – the success continues
Azilect® – the success continues Anti-Parkinson’s market European market share continues to Europe increase now having 5% of the market Market share, value – market growth, volume Azilect® by Lundbeck in more than 20 6% 5% countries in Europe and International Azilect® 5.4% Markets 5% 4% Once-
Slide 26: 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 27: 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 28: Financial figures – distribution of revenue in Q2 2008
Financial figures – distribution of revenue in Q2 2008 As percentage of total revenue 2% Q2 2008 14% Cipralex® (+20%) Excl. one- Incl. one- Q2 DKKm off items off items 2007 Growth 0.5% Lexapro® (+8%) 2% 42% Revenue 2,938 2,938 2,612 12% Ebixa® (+14%) R&D 566 1,047 549 91% 16% Azilect® (+58%) Serdole
Slide 29: Financial figures – distribution of costs in Q2 2008
Financial figures – distribution of costs in Q2 2008 Costs and EBIT as percentage of revenue 12% 16% Q2 Q2 DKKm 2008 2007 Growth Revenue 2,938 2,612 12% 21% 36% Production costs (CoGS) 469 398 18% Distribution costs 632 590 7% Administrative expenses 427 384 11% 15% R&D 1,047 549 91% CoGS Distributi
Slide 30: Key deliverables the next 12-18 months
Key deliverables the next 12-18 months Existing products J Life-cycle management initiatives for escitalopram J File Serdolect® in the US for schizophrenia J Defend IP rights vigorously if challenged J Expanded opportunities for Azilect® following ADAGIO Product launches J Circadin® in several Europ
Slide 31: 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 Guidance is excluding one-off items Capex is excluding in-licensing and milestone payments 31
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Slide 33: More information please contact Investor Relations
More information please contact Investor Relations Jacob Tolstrup Palle Holm Olesen Joan Loua Director 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 36 43 82 62 jtl@lundbeck.
Slide 34: 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 35: Revenue – by product / by region
Revenue – by product / by region International Total Europe USA Markets Q2 Q2 Q2 Q2 Q2 Q2 Q2 Q2 DKKm 2008 2007 2008 2007 2008 2007 2008 2007 Total revenue 2,938 2,612 1,574 1,364 692 641 621 550 Growth 12% 15% 8% 13% Cipralex® 1,234 1,027 857 706 - - 377 321 Growth 20% 21% 17% Lexapro® 692 641 - - 6
Slide 36: 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 37: Revenue, quarterly figures
Revenue, quarterly figures Revenue, DKK million Growth, Y/Y, % Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2007 2007 2008 2008 2007 2007 2008 2008 Total revenue 2,960 2,830 2,882 2,938 32% 11% 12% 12% Cipralex® 1,046 1,031 1,216 1,234 19% 10% 23% 20% Lexapro® 699 626 661 692 46% 19% 5% 8% Ebixa® 432 422 457 467 27% 13%
Slide 38: 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 39: Costs, quarterly figures
Costs, quarterly figures DKK million Growth, Y/Y, % Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2007 2007 2008 2008 2007 2007 2008 2008 Revenue 2,960 2,830 2,882 2,938 32% 11% 12% 12% Production costs 457 846 476 469 23% 103% -4% 18% Distribution costs 584 657 567 632 17% -4% -2% 7% Administrative expenses 358 395 399
Slide 40: Lundbeck hedge the USD on a rolling basis around 12 months ahead – 2008
Lundbeck hedge the USD on a rolling basis around 12 months ahead – 2008 USD hedge rate of 5.29 Actual rates Forward rates 10 9 8 7.90 7 6.68 6.00 6 5.89 5.75 5 5.24 5.11 4.99 4.85 Quarterly figures 4 '03 '04 '05 '06 '07 Q3 '08 Q4 '08 Q1 '09 Q2 '09 Average US$ exchange rate Average hedging US$ rate N
Slide 41: 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 42: Cipralex® / Lexapro® - best-in-class: Depression
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 43: Cipralex® / Lexapro® - best-in-class: Anxiety
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 44: 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 45: 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 46: 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 47: 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 48: 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 49: 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 50: 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 51: 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 52: 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 53: 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® BMS/Cephalon 11 479