Kyowa Kirin Co., Ltd. · TSE:4151

Kyowa Kirin — FY2019 Earnings Presentation

34 slides from Kyowa Kirin's earnings presentation, February 2020

  1. Slide 1: Results Presentation Fiscal 2019

    Results Presentation Fiscal 2019

  2. Slide 2: Agenda

    Agenda FY2019 Financial Review ＆ FY2020 Forecasts Shareholder Returns Plan R&D Review Business Topics President and Chief Executive Officer Masashi Miyamoto, Ph.D Q&A President and Chief Executive Officer Masashi Miyamoto, Ph.D Executive Officer, Head of R&D Division Mitsuo Satoh, Ph.D Executive Off

  3. Slide 3: Forward-looking statements disclaimer

    This document contains certain forward-looking statements relating to such items as the company’s (including its domestic and overseas subsidiaries) forecasts, targets and plans. These forward-looking statements are based upon information available to the company at the present time and upon reasona

  4. Slide 4: FY2019 Financial Review

    FY2019 Financial Review © Kyowa Kirin Co., Ltd. 4

  5. Slide 5: Summary of FY2019 Results

    Summary of FY2019 Results ( Billion Yen / Rounded ) 2018 2019 2019 Changes Progress Results Results Plan Revenue 271.5 305.8 +34.3 (+13%) 305.0 100% [Overseas Ratio] [32%] [39%] [39%] Gross Profit 198.1 226.2 +28.1 (+14%) 224.0 101% [Gross Profit margin] [73%] [74%] [73%] Core OP 50.3 59.4 +9.0 (+18

  6. Slide 6: YoY Analysis - Revenue

    YoY Analysis -Revenue- ⚫ Domestic Drug -0.9 • Rituximab BS (Launched in 2018), G-Lasta (Market expansion), and +34.3 billion yen Romiplate (Additional indication) made strong growth, however they could not cover the impact of NHI price cut and the shrink (incl. forex effect -4.9) of Nesp (Nesp-AG la

  7. Slide 7: Revenue of Major Items (Japan)

    Revenue of Major Items (Japan) ( Billion yen / Rounded ) 2018 2019 Changes Reason 2020 Changes Item Results Results Plan Nesp + Nesp-AG* 53.7 47.6 -6.1 (-11%) 34.7 -27% Nesp 53.7 33.6 -20.1 (-37%) Nesp-AG launched in Aug 2019 4.0 -88% Nesp-AG ー 14.0 +14.0 30.7 +119% A competitor’s penetration Regpar

  8. Slide 8: Revenue of Major Items (Overseas)

    Revenue of Major Items (Overseas) ( Billion yen / Rounded ) 2018 2019 Changes Reason 2020 Changes Item Results Results Plan Crysvita*1 7.7 32.5 +24.8 (+321%) Launched in Apr 2018 56.6 +74% North America 25.1 Europe & others 7.4 Poteligeo 2.1 10.8 +8.7 (+416%) Launched in Oct 2018 14.3 +32% Nourianz

  9. Slide 9: Crysvita (EMEA/RoW) Successful Market Penetration

    Crysvita (EMEA/RoW) Successful Market Penetration in EMEA/RoW for the 2nd Year Pts © Kyowa Kirin Co., Ltd. 9

  10. Slide 10: YoY Analysis - Core OP

    YoY Analysis -Core OP- +9.0 billion yen ⚫ Gross Profit +28.1 (incl. forex effect -3.9) • Increased in conjunction with the rise in the revenue. (incl. forex effect -1.0) Gross profit margin up by 1 point, from 73% to 74%. (¥Bn) ⚫ SG&A -15.2 (incl. forex effect +2.4) • Increased selling and launch re

  11. Slide 11: YoY Analysis - Profit

    YoY Analysis -Profit- Profit (Jan-Dec) +12.7 billion yen • Gain on sale of Kyowa Medex shares (2018) -11.0 • Gain on sale of fixed assets (2018) -3.7 • Gain on reversal of impairment losses (2018) -3.4 (¥Bn) • Impairment losses (2018･2019) -5.1 • Business restructuring expenses (2019) -5.2 • Product

  12. Slide 12: P/L Impact from the Quality Control Issue (Recall of Mitomycin)

    P/L Impact from the Quality Control Issue (Recall of Mitomycin) Amount Notes Cost of Goods Sold ¥2.0 Bn Mainly stock disposal Impact to Core OP -¥2.0 Bn Other Expenses (Provision for Product Including losses not yet ¥2.0 Bn Recall-related Losses) determined Impact to Pre-tax Profit -¥4.0 Bn Recogniz

  13. Slide 13: FY2020 Forecasts

    FY2020 Forecasts © Kyowa Kirin Co., Ltd. 13

  14. Slide 14: Summary of FY2020 Forecasts

    Summary of FY2020 Forecasts ( Billion Yen / Rounded ) 2019 2020 Changes Results Forecasts Revenue 305.8 327.0 +21.2 (+7%) [Overseas Ratio] [39%] [47%] Gross Profit 226.2 250.0 +23.8 (+11%) [Gross Profit margin] [74%] [76%] Core OP 59.4 65.0 +5.6 (+10%) [Core OP margin] [19%] [20%] Profit 37.7 49.0 +

  15. Slide 15: 2019 Results vs 2020 Forecasts

    2019 Results vs 2020 Forecasts Profit (Jan-Dec) -18.1 billion yen Revenue +21.2 • Domestic -13.3 • SG&A -13.7 • Business sold: Bio-chemicals business • Overseas +29.9 • Tech-licensing +4.6 • R&D -1.5 • Date of sale: April 24, 2019 • Gain on sale: 29.7 (post-tax) (¥Bn) • Impairment losses (2019) +6.1

  16. Slide 16: Shareholder Returns Plan

    Shareholder Returns Plan © Kyowa Kirin Co., Ltd. 16

  17. Slide 17: Aiming continued escalation in dividends based on a payout ratio of 40%

    Shareholder Returns Plan ⚫ FY2019 dividends determined to be 42 yen (+7 yen) ⚫ FY2020 dividends planned to be 44 yen (+2 yen) * Repurchase of 10.7M own shares (¥22.6B) executed on February 6, 2019. Total Return Ratio 67.3%* Aiming continued escalation in dividends based on a payout ratio of 40% [Bas

  18. Slide 18: R&D Review

    R&D Review © Kyowa Kirin Co., Ltd. 18

  19. Slide 19: Key Development Updates in 19Q4

    Key Development Updates in 19Q4 • Acceptance of the application for the expanded use of KRN23 for adult XLH in Europe (November) • Initiation of the phase 3 study of KW-3357 for the treatment of preeclampsia in Japan (November) • Partial change approval of KHK7580 for hypercalcemia in patients with

  20. Slide 20: Key Development Updates after December

    Key Development Updates after December • Acceptance of the marketing authorization application for approval of KW-6002 for Parkinson’s disease in Europe (January) © Kyowa Kirin Co., Ltd. 20

  21. Slide 21: Business Topics

    Business Topics © Kyowa Kirin Co., Ltd. 21

  22. Slide 22: "One Kyowa Kirin" Organization

    “One Kyowa Kirin” Organization Global Management System from April 2019 EMEA US RoW Global HQ CAN Japan Asia Oceania Japan EMEA North Asia Regulatory Affairs others America Oceania QA Research Development PV SCM Functions × Regions = Global Matrix Organization © Kyowa Kirin Co., Ltd. 22

  23. Slide 23: All Products Kyowa Kirin Received MA in 2019

    All Products Kyowa Kirin Received MA in 2019 (incl. additional indication) Lumicef Crysvita Nourianz Crysvita Hong Kong Japan USA UAE Orkedia Romiplate Japan Japan Making further leaps as a Global Pharmaceutical Company © Kyowa Kirin Co., Ltd. 23

  24. Slide 24: Appendix

    Appendix © Kyowa Kirin Co., Ltd. 24

  25. Slide 25: FOREX Information

    FOREX Information Average FOREX Rate (Yen) 2018 2019 2020 Currency Changes Results Results Plan USD/JPY 110 109 -1 105 GBP/JPY 148 140 -8 130 FY2019 FOREX Impact (YoY) (Billion yen) Currency Revenue Core OP USD/JPY -0.9 -0.1 GBP/JPY -2.8 +0.1 FY2020 Currency Fluctuation Sensitivity (Billion yen) Cur

  26. Slide 26: Key progress in development (2019)

    Key progress in development (2019) Note: Listed events were completed between January 1st, 2019 and December 31st, 2019. Generic name Month Code Indication Country/region Event Burosumab FGF23-related hypophosphatemic rickets Jan. KRN23 and osteomalacia JP US EU RoW Filed Tenapanor Hyperphosphatemia

  27. Slide 27: Submission plan of major pipeline

    Submission plan of major pipeline As of December 31st, 2019 Generic name Code Indication Country/region 2019 2020 2021~ Burosumab 1 KRN23 XLH (adult) JP US EU RoW Filed + Burosumab KRN23 XLH2 JP US EU RoW Filed + Burosumab KRN23 XLH2 JP US EU AS Filed3 + Burosumab Tumor-induced KRN23 osteomalacia JP

  28. Slide 28: Development plan of major pipeline

    Development plan of major pipeline As of December 31st, 2019 Generic name Code Indication Country/region 2019 2020 2021~ Bardoxolone methyl Diabetic Kidney disease RTA 402 JP US EU RoW Phase 3 Bleselumab1 Recurrence of FSGS in de ASKP1240 novo kidney transplant JP US EU RoW Phase 2 Entinostat Breast

  29. Slide 29: Estimated annual incidence/prevalence

    Estimated annual incidence/prevalence Disease Country Estimated # of Incidence (i) Source /region or Prevalence (p) ATL Japan i: 1,150 per year i: Survey and countermeasures to HTLV-1 infection and related diseases in Japan. 2009 summary p: 2,000 research report (Yamaguchi, 2010) p: Ministry of Heal

  30. Slide 30: Crysvita - Collaboration with Ultragenyx

    Crysvita ‐ Collaboration with Ultragenyx ‐ Kyowa Kirin Group Ultragenyx ⚫ Books sales ⚫ For first 5 years, splits profits in half U.S.A ⚫ For first 5 years, splits profits in half ⚫ After 5 years, receives mid to high 20% range sales /Canada ⚫ After 5 years, pays mid to high 20% range sales royalty

  31. Slide 31: Business Expansion in Asia

    Business Expansion in Asia Kyowa Kirin Korea Revenue in 2019：7.2 B JPY Main Products：Neulasta, Nesp, Grasin Kyowa Hakko Kirin China Pharmaceutical Revenue in 2019：8.7 B JPY Main Products：Regpara, Gran, Coniel Kyowa Kirin Taiwan Revenue in 2019 ：4.2 B JPY Main Products ：Nesp, Gran, Regpara Kyowa Kiri

  32. Slide 32: List of acronyms

    List of acronyms AA Aplastic Anemia AD Atopic Dermatitis ATL Adult T-Cell Leukemia/Lymphoma BS Biosimilar CKD Chronic Kidney Disease CTCL Cutaneous T-Cell Lymphoma DKD Diabetic Kidney Disease ENS Epidermal Nevus Syndrome FSGS Focal Segmental Glomerulosclerosis HAM HTLV-1 Associated Myelopathy HSC He

  33. Slide 33: Revision History

    Revision History Feb. 19, 2020 P10 Core Operating Profit / forex effect / -0.4 billion yen -> -1.0 billion yen Gross Profit / forex effect / -3.4 billion yen -> -3.9 billion yen © Kyowa Kirin Co., Ltd. 33

  34. Slide 34: Kyowa Kirin Co., Ltd. Corporate Communications Dept., IR Group

    Kyowa Kirin Co., Ltd. Corporate Communications Dept., IR Group +81-3-5205-7206 / ir@kyowakirin.com

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