Slide 1: AstraZeneca Q4 and Full Year 2014 Results
AstraZeneca Q4 and Full Year 2014 Results
Slide 2: Cautionary statement regarding forward-looking statements
Cautionary statement regarding forward-looking statements In order, among other things, to utilise the 'safe harbour' provisions of the US Private Securities Litigation Reform Act 1995, we are providing the following cautionary statement: This presentation contains certain forward-looking statements
Slide 3: Q4 and Full Year 2014 Results
Q4 and Full Year 2014 Results Pascal Soriot Overview Luke Miels Growth platforms Marc Dunoyer Finance Briggs Morrison Pipeline Pascal Soriot Closing 3
Slide 4: 2014: Continued strategic progress
2014: Continued strategic progress Returning to growth • Q4 2014: 4th consecutive quarter of revenue growth; $6,683m, +2% (+3% excl. effect of US Branded Pharma Fee) • FY 2014: Growth platforms +15%; 53% of total revenue: • Brilinta: +70% • Diabetes: +139% • Respiratory: +10% • Emerging Markets: +12
Slide 5: 2014: Upgraded guidance fully met
2014: Upgraded guidance fully met FY 2014 CER $m growth % Revenue 26,095 3 Growth platforms 13,928 15 US 10,120 4 Europe 6,638 (1) Emerging Markets 5,827 12 China 2,242 22 Japan 2,227 (3) Core EPS $4.28 (8) 5
Slide 6: Strategic priorities
Strategic priorities Achieve 1 Return 2 Be a great 3 scientific to growth place to work leadership 6
Slide 7: Achieve scientific leadership
Achieve scientific leadership Industry-leading number of On track to deliver 7-8 potential NDA/BLA approvals in 2014 NME submissions in 2015-2016 CAZ AVI (CEPH/BLI) serious infections cediranib (VEGFR) AZD6094 (MET) ovarian cancer (EU) papillary renal cell carcinoma selumetinib (MEK) tremelimumab (C
Slide 8: Evolving the business model to create maximum value from strong R&D productivity
Evolving the business model to create maximum value from strong R&D productivity Biotechs Out-license Internal Development Externalisation development Manufacturing Partner Commercialisation Value creation through Internal development and Externalisation 8
Slide 9: Return to growth: Strong development of growth platforms
Return to growth: Strong development of growth platforms Growth platforms Total revenue (% of revenue) (% change vs. 2013) Revenue Revenue $m $m 53% 14,000 7,000 +5% +2% (+3%*) 49% +3% +4% 12,000 41% 6,000 10,000 5,000 8,000 4,000 6,000 3,000 4,000 2,000 2,000 1,000 0 0 FY 2012 FY 2013 FY 2014 Q1 20
Slide 10: Growth platforms
Growth platforms Luke Miels, EVP Global Portfolio & Product Strategy
Slide 11: Growth platforms: Strong delivery
Growth platforms: Strong delivery FY 2014 Growth Brilinta $476m 70% Diabetes $1,870m 139% Respiratory $5,063m 10% Emerging Markets $5,827m 12% Japan $2,227m -3%* Oncology emerging as sixth growth platform Growth rates at constant exchange rates (CER) *Including impact from mandated price cuts 11
Slide 12: Brilinta: Continued progress
Brilinta: Continued progress $m 140 • Q4 2014 revenue +52% to $133m EM $21m 120 • US +79% to $43m supported by positive EST ROW $9m news flow from DoJ closure and NSTE-ACS* 100 guideline changes in October 80 EUR $60m • Continued growth in Europe; Emerging 60 Markets more than doubling sales 40 • PE
Slide 13: Brilinta: Steady increase in US
Brilinta: Steady increase in US US oral anti-platelet class market shares US hospital units purchased (new-to-brand prescriptions NBRx) 60,000 15% 49,960 2013 2014 50,000 40,000 10% 40,314 30,000 8.07% 7.57% 20,000 5% Closure of DoJ 10,000 Investigation 0 0% 05-Jul-13 05-Aug-13 05-Sep-13 05-Nov-13 0
Slide 14: Brilinta: And steady increase globally
Brilinta: And steady increase globally 2013-2014 ACS Oral anti-platelet market share hospital discharge change (retail + hospital) 8.0% US 7% 7.0% UK 5% 6.0% 5.0% Spain 12% 4.0% Italy 3% 3.0% Germany -5% 2.0% 1.0% France 4% 0.0% Australia 4% 0 4 8 12 16 20 24 28 32 36 40 44 48 -10% -5% 0% 5% 10% 15%
Slide 15: Diabetes: Farxiga/Forxiga launch ongoing; encouraging US Bydureon Pen uptake
Diabetes: Farxiga/Forxiga launch ongoing; encouraging US Bydureon Pen uptake $m 500 Others • Good Farxiga uptake in US, accelerating $103m 400 SGLT-2 class growth post launch. Strong Bydureon Forxiga start in key emerging markets $123m 300 • Onglyza US demand slightly negative. Byetta 200 $69m High-
Slide 16: Farxiga: Continued US uptake; SGLT-2 market acceleration post launch
Farxiga: Continued US uptake; SGLT-2 market acceleration post launch US Farxiga volume US SGLT-2 market (weekly prescriptions) (new monthly prescriptions NRx) 30,000 200,000 Farxiga launch – 27,039 180,000 driving class growth 25,000 160,000 140,000 20,000 120,000 15,000 100,000 80,000 10,000 10,560
Slide 17: Forxiga: Strong start in key international markets
Forxiga: Strong start in key international markets Farxiga/Forxiga launch uptake among innovative oral anti-diabetic medicines (SGLT-2 + DPP4) 13 12 11 Market share days on therapy 10 9 8 7 6 5 4 3 2 1 0 M1 M2 M3 M4 M5 M6 M7 M8 M9 M10 M11 M12 M13 M14 M15 M16 M17 M18 M19 M20 USA Brazil Mexico Argenti
Slide 18: Bydureon: Strong US uptake of new Pen; EU launch next
Bydureon: Strong US uptake of new Pen; EU launch next US Bydureon family US Bydureon family share in GLP-1 market (new monthly prescriptions NRx) 40% 40,000 TRx NRx NBRx Bydureon Tray Bydureon Pen 35% 35,000 30% 33.0% 30,000 25% 25,000 20.9% 20% 20,000 20.7% Chg Pen Chg vs Chg Vs 15% Launch Sep Dec
Slide 19: Symbicort: US sales growth decelerating; Emerging Markets strengthening
Symbicort: US sales growth decelerating; Emerging Markets strengthening $m 1,000 • Q4 2014 revenue +5% to $978m EM 900 $115m 800 EST ROW • US +13%, decelerating (including impact $121m from Branded Pharmaceutical Fee) 700 600 EUR • EU revenue -7%, stable volume, but price $347m impact from analogues
Slide 20: Emerging Markets: Continued strong growth
Emerging Markets: Continued strong growth China 23% 22% 23% 21% 20% 21% 21% 21% 19% 13% 12% 13% Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 12% EMs outside China 10% 9% 5% 5% 2% 3% 1% 2% 0% -2% -3% -1% +4% +8% Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3
Slide 21: Japan: Positive underlying demand for growth brands
Japan: Positive underlying demand for growth brands Key growth brands (2014) Overall in-market performance • In-market growth 4.9% (2014) and 3.2% (Q4) Crestor 36.1% market share (+3.5%-p) +2% • Reported business sales negatively impacted by mandated biennial price reductions, increased use of gener
Slide 22: Launch products
Launch products Opioid-induced constipation BRCA-mutated advanced ovarian cancer • US launch expected H1 2015 • US & EU (France 1st) launch in following recent de-scheduling December 2014 determination • Rapid uptake due to bolus of patients • EU launch expected H2 2015 awaiting treatment Duaklir Ch
Slide 23: Finance
Finance Marc Dunoyer, Chief Financial Officer
Slide 24: 2014: Headlines & priorities
2014: Headlines & priorities 2014 headlines • Upgraded guidance fully met • Continuous investment in R&D to support the accelerating pipeline • Investment in growth platforms peaked in Q4 2014 Finance priorities • Profit & loss redeployment Support progressive dividend • Balance sheet flexibility Su
Slide 25: Profit & loss: Redeployment
Profit & loss: Redeployment Core SG&A Examples Total IT costs Total facilities costs 24% 32% $m -11% $m -8% G&A 76% SM&M 68% 2012 2014 2012 2014 2012 2014 Structural change in SG&A due to redeployment Has supported increased investment in: of resources • Growth platforms, including Emerging Markets
Slide 26: Balance sheet: Flexibility
Balance sheet: Flexibility Cash conversion cycle (days) Debt & cash • Continue to target a strong, investment-grade Peer average 87 credit rating • Moody’s: A2 Stable outlook • Standard & Poor’s: AA- Negative outlook • November 2014: 0.875% EUR 2021 medium- 69 term notes (€750m); oversubscribed 4 ti
Slide 27: Q4 2014 considerations
Q4 2014 considerations Q4 Q4 CER R&D investment 2014 2013 Growth Factors • Pipeline progression/acceleration, e.g.: $m $m % • Oncology immuno & small molecules • RIA biologics pipeline +3% excluding US Branded • Brilinta PARTHENON costs peaked Revenue 6,683 6,844 2 Pharmaceutical Fee SG&A • Growth p
Slide 28: 2014: Upgraded guidance fully met
2014: Upgraded guidance fully met FY 2014 FY 2013 CER % $m $m growth % sales Revenue 26,095 25,711 3 Core Gross Profit 21,207 21,078 3 81 Distribution (324) (306) 7 1 Core R&D (4,941) (4,269) 15 19 Core SG&A (10,216) (8,865) 16 39 Core Tax Rate 16% 20% - - Core EPS 4.28 5.05 (8) 28
Slide 29: Accounting for the US Branded Pharmaceutical Fee
Accounting for the US Branded Pharmaceutical Fee • New regulations in Q3 2014 affecting how the annual branded pharmaceutical fee is recognised. Affected entities will now accrue for the obligation as each sale occurs. • As the fee is based on actual sales in the current year - we will account for t
Slide 30: 2015 guidance
2015 guidance Sales revenue1 Decline by mid single-digit percent Constant exchange rates Core EPS Increase by low single-digit percent 1 Assumes imminent launch of a Nexium generic in the US market 30
Slide 31: 2015 currency sensitivity
2015 currency sensitivity • The Company also provides the following non-guidance information related to currency sensitivity: Based on current exchange rates1, sales revenue is expected to decline by low double-digit percent with Core EPS expected to be broadly in line with 2014. Currency sensitivit
Slide 32: 2014: Targeted business development in main areas
2014: Targeted business development in main areas Respiratory, Inflammation Cardiovascular & Metabolic NGM Oncology & Autoimmunity Disease • Strengthened inhaled portfolio in • Strengthened diabetes portfolio asthma and COPD and commitment to main therapeutic areas • SNG001: Novel, inhaled interfero
Slide 33: Respiratory: Actavis deal strengthens franchise
Respiratory: Actavis deal strengthens franchise • Strategic deal to add US rights to Europe & ROW aclidinium franchise acquired from Almirall in 2014, including Tudorza (LAMA) and Pressair DPI device • Augments the Respiratory franchise with Actavis product, Daliresp (oral PDE4 inhibitor for COPD) •
Slide 34: Pipeline
Pipeline Briggs Morrison, EVP Global Medicines Development
Slide 35: 2014: An outstanding year
2014: An outstanding year Outstanding year Improve the lives of 200 million patients…one patient at a time • Industry-leading 6 NDA/BLA approvals • Excellent pipeline progress • Focusing R&D spend on main therapeutic areas 35
Slide 36: 2014: Late-stage pipeline highlights
2014: Late-stage pipeline highlights Compound Indication Milestone RIA lesinurad gout Phase III topline results; US & EU submission (Q4) Bydureon Pen type 2 diabetes US & EU approval Farxiga/Forxiga type 2 diabetes US & Japan approval CVMD Xigduo type 2 diabetes US & EU approval Epanova hypertriglyc
Slide 37: Recent highlights: Respiratory, Inflammation & Autoimmunity (RIA)
Recent highlights: Respiratory, Inflammation & Autoimmunity (RIA) ACR (November 2014) Symbicort SYGMA study started Sifalimumab (Phase IIb in lupus/SLE) • First Phase III trial for the treatment of mild asthma • Key endpoints met • Potential for improved disease control with flexible as- needed regi
Slide 38: Recent highlights: Cardiovascular & Metabolic Disease (CVMD)
Recent highlights: Cardiovascular & Metabolic Disease (CVMD) Diabetes Brilinta Saxa/dapa • PEGASUS: Statistically significant reduction in major • Regulatory submission: US Q4 2014, EU expected CV events in patients with history of heart attack Q2 2015 • Expect presentation at ACC in March 2015 • On
Slide 39: Recent highlights: Oncology
Recent highlights: Oncology Approvals / Submissions Latest key milestones Lynparza AZD9291 (EGFR) • Approval US & EU (Q4 2014) • Enrolment complete Phase II (2L NSCLC EGFRm/T790M) • First-in-class oral PARP inhibitor approved for the treatment Tremelimumab (CTLA-4) of gBRCAm advanced ovarian cancer
Slide 40: Late-stage pipeline: Key news flow through 2015
Late-stage pipeline: Key news flow through 2015 Compound Indication Potential milestone brodalumab1 psoriasis Regulatory submission PT003 (LAMA/LABA) COPD Phase III results & regulatory submission RIA anifrolumab lupus/SLE Phase II presentation lesinurad gout Regulatory submission Brilinta prior MI
Slide 41: Oncology: Key milestones through 2015
Oncology: Key milestones through 2015 Expected data presentations 1H 2015 Expected data availability 2015 AACR 2015 AZD9291 (EGFR) • AZD6094 (MET) • Phase II (2L NSCLC EGFRm/T790M) Phase I (all comers) Selumetinib (MEK) • AZD8186 (PI3Kb/d) • Phase III SUMIT (metastatic uveal melanoma) Phase I (multi
Slide 42: Closing
Closing Pascal Soriot, Chief Executive Officer
Slide 43: Closing remarks
Closing remarks Growth platforms +15% CER, contributing 53% of total revenue Investments in growth platforms & expanding pipeline Industry-leading number of NDA/BLA approvals Pipeline on track to deliver in 2015 and beyond 2015 Core EPS is expected to increase by low single-digit percent at CER 43
Slide 44: Q&A
Q&A Pascal Soriot, Chief Executive Officer Marc Dunoyer, Chief Financial Officer Briggs Morrison, EVP Global Medicines Development Luke Miels, EVP Global Portfolio & Product Strategy