Novo Nordisk A/s Class B · OMXCOP:NOVO_B
Novo Nordisk A/s Class B — Non-Deal Roadshow (March 2001)
76 slides from Novo Nordisk A/s Class B's roadshow presentation, March 2001
Slide 1: Novo Nordisk: A focused global healthcare company with biotech expertise
Novo Nordisk A focused global healthcare company with biotech expertise Investor Presentation Spring 2001
Slide 2: Novo Nordisk Today
Novo Nordisk Today Consistent, strong organic growth Focused on few therapeutic areas with large unmet medical needs Leadership in diabetes care and haemostasis management Strong presence in Europe and Japan, strong growth in the US Proven biotech and drug delivery capabilities Low exposure to paten
Slide 3: Turnover by Therapy
0 5 10 15 20 25 DKK billion 1997 HRT Other Diabetes care 1998 Coagulation disorders Human growth hormone 1999 Turnover by Therapy 2000 Key observations: Diabetes business has delivered more than 10% growth on average per annum for 77 years Strong market penetration by NovoSeven® Conversion from Nord
Slide 4: Turnover by Region
0 5 10 15 20 25 1997 DKK billion USA RoW Japan Europe 1998 1999 Turnover by Region 2000 Key observations: Stable underlying growth in Europe and Japan Increasing insulin sales and good market penetration of NovoSeven® in the US Strong foothold in emerging markets
Slide 5: Long-term Financial Targets
Long-term Financial Targets Targets set out in 1996 Observations from 2000 EBIT growth of 15% per annum EBIT growth of 37% EBIT margin of 20% EBIT margin of 23.1% RONFA of 20% RONFA of 27.5% Positive cash flow Free cash flow of DKK 2,712 million All targets met by 2000
Slide 6: Novo Nordisk – Future Key Drivers
Novo Nordisk – Future Key Drivers Primary Coagulation growth Diabetes care drivers disorders Secondary Human growth Intellectual value HRT drivers hormone property
Slide 7: Novo Nordisk – Future Key Drivers
Novo Nordisk – Future Key Drivers Primary Coagulation growth Diabetes care drivers disorders Secondary Human growth Intellectual value HRT drivers hormone property
Slide 8: Diabetes – an Unfolding Epidemic
Diabetes – an Unfolding Epidemic WHO estimates that the number of diabetics world wide will reach 300 million by 2025 220 World Health Organisation, 150 September 1998 The cost of treating people with diabetes is expected to 2000 2010 amount to about USD 1 trillion annually – in the Increase in the
Slide 9: Only about One Third are Diagnosed
Only about One Third are Diagnosed 175 150 150 Increased 125 rate of 100 diagnosis will 75 50 lead to 50 increased use 25 of insulin 0 Estimated number Estimated number of diagnosed of people with people diabetes with diabetes
Slide 10: Treatment Matters
Treatment Matters Only a small number of Intensive treatment matters patients are in control Distribution of patients Close to 80% are exposed to HbA1c lowering by one arterial or micro vascular risk* percentage point reduces micro vascular risk by 35%** HbA1c * Measured according to Guidelines for
Slide 11: More Intensive Treatment
More Intensive Treatment 180 Long acting Premixes Short acting The share of sales of 160 +9% short-acting and pre- +7% 140 +4% mixable insulin has 24% +6% +3% increased 120 substantially 19% Mega Units in 100 39% 1,000 80 32% 60 40 This indicates 49% 37% 20 intensive/flexible 0 treatment is being ad
Slide 12: Towards More Sophisticated Devices
Towards More Sophisticated Devices % pen users in volume split by region 81% 2000 73% 7% 1999 1998 1997 1996 0% 25% 50% 75% 100% Japan Europe US Note: Numbers are all MAT Q3
Slide 13: Analogues to Replace Human Insulin
Analogues to Replace Human Insulin % insulin volume split by type of insulin Insulin analogue 100% 8% 90% 75% 50% Human insulin 25% Animal insulin 0% 2% 1986 1988 1990 1992 1994 1996 1998 2000 Note: Numbers are all MAT Q3
Slide 14: Adding Value to Volume at Novo Nordisk
Adding Value to Volume at Novo Nordisk One new device each year Full range of analogues NVO LLY AVE Rapid-acting Marketed Marketed Ph1/Ph2 Basal Ph3 Marketed Premix, protracted Approved Marketed
Slide 15: Upgrading the Insulin Market
Upgrading the Insulin Market Pens Estimated average Vials Human insulin treatment cost per day USD 1.5 USD 1.0 Insulin analogue USD 1.3 USD 2.0
Slide 16: US – Positioned for Growth
Index MATQ3.1995=100 110 130 150 170 190 50 70 90 Insulin sales (USD) US insulin market share and sales development Market share in MU (right-hand scale) MAT MAT MAT MAT MAT MAT Q3/95 Q3/96 Q3/97 Q3/98 Q3/99 Q3/00 10% 12% 14% 16% 18% 20% 22% 24% 26% US – Positioned for Growth New management recruite
Slide 17: Emerging Markets Likely to Add Growth
Emerging Markets Likely to Add Growth Estimated insulin consumption per cap (USA index 100) Increased wealth (western USA lifestyle) and health care spending lead to increased Europe insulin consumption average of USA, Japan Novo Nordisk has been Europe and Weighted present in markets like India Ind
Slide 18: Insulin Market Overview
Insulin Market Overview (’99/ ’00 MAT Q3 Volumes) % market size Market growth Novo Nordisk MAT Q3.00 (‘00/’99) Market share USA 2.9% 44% 25% Europe 15.8% 58% 46% Japan 10.1% 4% 80% RoW 10.5% 6% 61% World 9.3% 100% 44% Notes: Industrialised world only. Mail-order panel now included in the US figures.
Slide 19: Key Insulin Market Observations
Key Insulin Market Observations Volume to deliver approx 5% growth Product mix adding growth of approx 5% 10%* growth in attractive Estimated market Few players with strong core competences Large-scale recombinant protein production capacity Access to superior delivery technology Analogues are paten
Slide 20: From Diet and Exercise to Insulin
From Diet and Exercise to Insulin Type 1: (4 million patients*) Type 2: (147 million patients*) Therapy: Diet/Exercise Oral products Oral/Insulin Insulin Approx 66% Approx 7% Approx 27% An estimated 25-30 million using medication * Estimated year 2000 incl. undiagnosed.
Slide 21: Growth Opportunity in Type 2 Diabetes
Growth Opportunity in Type 2 Diabetes Broad pipeline of innovative approaches for treating Type 2 diabetes Well positioned for NovoNormTM/Prandin® further growth Turnover of DKK 1,087 million in 2000 in USD 5.2 bn Increased awareness on prandial glucose (+18% in regulation (PGR) MATQ3.00) Experience
Slide 22: Type 2 Diabetes – the Metabolic Syndrome
Type 2 Diabetes – the Metabolic Syndrome Genetic Acquired Glucotoxicity Lipotoxicity Insulin deficiency Impaired Hepatic Glucose-induced beta cell glucose insulin secretion function production Post Hyperglycemia receptor Tissue response defect Glucose Basal hyper- to insulin uptake Glucose insulinem
Slide 23: Type 2 Diabetes – the Metabolic Syndrome
Type 2 Diabetes – the Metabolic Syndrome Genetic NN622 Acquired NN4201 NN2211 Glucotoxicity Lipotoxicity NovoNormTM/Prandin® NovoRapid Insulin deficiency NN304 Impaired Hepatic Glucose-induced beta cell NN1998 glucose insulin secretion function production Post Hyperglycemia receptor Tissue response
Slide 24: Diabetes Pipeline
Diabetes Pipeline Phase 1 Phase 2 Phase 3 Registration NN4201 NN1998 NN304 NovoMix® 30 (Hepatic glucose (AERx) (Basal analogue) (Premix analogue) regulator) NN414 NN2344 NovoMix® (other mixes) (Insulin secretion) (Insulin (Premix analogue) sensitiser) NN1215 NN622 (LABI) (Dual acting sensitiser) NN2
Slide 25: Novo Nordisk – Future Key Drivers
Novo Nordisk – Future Key Drivers Primary Coagulation growth Diabetes care drivers disorders Secondary Human growth Intellectual value HRT drivers hormone property
Slide 26: NovoSeven Sales
NovoSeven® Sales DKK million 2,500 Inhibitor indication: Estimated market 2,000 potential USD 350 million Launched: 1,500 Europe Feb 1996 USA April 1999 1,000 Japan May 2000 500 0 1996 1997 1998 1999 2000
Slide 27: Mechanism of Action and Characteristics
Mechanism of Action and Characteristics The key features of NovoSeven® are: Injury site selective activation of platelets Rupture FVIIa / creates high local thrombin Tissue factor NovoSeven® formation which secures a tight fibrin clot Correction of coagulation within 10 minutes Good safety profile
Slide 28: Growing Current Indication
Growing Current Indication Launch NovoSeven® globally and establish a leadership position in congenital inhibitor treatment via Superior product benefits Customer relations Expand global within current leadership Synergies between markets indication market Pharma economic research Enhance NovoSeven®
Slide 29: Expanding the Use of NovoSeven
Expanding the Use of NovoSeven® Coagulation Factor Platelet General Deficiency Disorder Haemostasis Single Multiple Lack of Defective Surgical Spontaneous Factor Factors platelets platelets bleeding bleeding Haemophilia with Glanzmann Liver resection Intra-cerebral Liver transplantations inhibitors
Slide 30: NovoSeven Is Expected to Make a Difference
Novoseven® Is Expected to Make a Difference Physicians Control of bleedings Dry surgical field Higher rate of success Flexibility in timing Fewer complications Less dependent on blood bank N7 in general haemostasis Patients Payers Higher chance of survival Reduced ICU and ward-days Fewer days at hos
Slide 31: Towards the First General Haemostatic Agent
Towards the First General Haemostatic Agent Criteria for moving into clinical area: 8 studies within 6 clinical areas: Medical need Orthotopic liver transplantations* Probability of success Liver resection* Market potential Upper GI bleeds* Competitive situation Liver resection Reversal of anti-coag
Slide 32: Building Strong Scientific Evidence
Building Strong Scientific Evidence Clinical area Status on project Orthotopic liver transplantation* Ongoing Ph 2/3 project Liver resection Exploratory Ph 2 study has been initiated Upper GI bleeds* Ph 2 study expected to start in first half 2001 Liver resection* Ph 2 study expected to start in fir
Slide 33: Expanding the Use of NovoSeven
Expanding the Use of Novoseven® Coagulation Factor Platelet General Deficiency Disorder Haemostasis Single Multiple Lack of Defective Surgical Spontaneous Factor Factors platelets platelets bleeding bleeding Haemophilia with Glanzmann Liver resection Intra-cerebral Liver transplantations inhibitors
Slide 34: Novo Nordisk – Future Key Drivers
Novo Nordisk – Future Key Drivers Primary Coagulation growth Diabetes care drivers disorder Secondar Secondary y Human growth Intellectual value HRT drivers hormone property
Slide 35: Human growth hormone
Human growth hormone DKK million 2,500 Norditropin®SimpleXx™: 2,000 Launched: 1,500 EU: April 1999 1,000 Japan: July 2000 USA: Oct. 2000 500 0 1996 1997 1998 1999 2000
Slide 36: Conversion to Norditropin SimpleXx
Conversion to Norditropin®SimpleXxTM Conversion rate by Q3 2000 Europe Launch Q1 1999 Market share has increased Europe: Japan Launch Q2 2000 Share of new Japan: patients has increased USA 0% 20% 40% 60% 80% 100% Launch Q4 2000 Norditropin® SimpleXxTM Norditropin®
Slide 37: Novo Nordisk – Future Key Drivers
Novo Nordisk – Future Key Drivers Primary Coagulation growth Diabetes care drivers disorders Secondary Human growth HRT Intellectual value drivers hormone property
Slide 38: Hormone Replacement Therapy (HRT)
Hormone Replacement Therapy (HRT) DKK million 1,400 ActivelleTM - the best low- 1,200 dose product in the fast- 1,000 growing continuous combined segment 800 600 Further geographic expansion of ActivelleTM 400 Out-licensed to 200 Pharmacia in the US 0 1996 1997 1998 1999 2000
Slide 39: Maximising the Potential within HRT
Maximising the Potential within HRT Trends in HRT positioned to benefit from ActivelleTM Low-dose products are trends increasingly favoured Women demand ‘no period’ therapy Direct-to-Consumer marketing is increasing with focus on lifestyle aspects
Slide 40: Novo Nordisk – Future Key Drivers
Novo Nordisk – Future Key Drivers Primary Coagulation growth Diabetes care drivers disorder Secondary Human growth HRT Intellectual value drivers hormone property
Slide 41: A Strong Portfolio of Intellectual Property
A Strong Portfolio of Intellectual Property Patents by year-end A total of 2,102 valid 2,500 patents by year-end 2000 First filing for 77 new 2,000 inventions during 2000 233 patents issued to 1,500 Novo Nordisk during 2000 alone mostly related to diabetes and devices 1,000 Three major settlements o
Slide 42: No Major Patent Expirations
No Major Patent Expirations % of 1999 sales with patents expiring in 2000-2004 60% 40% 20% 0% Source: ArosMaizels Research and Novo Nordisk
Slide 43: Financials
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Slide 44: Key Financials for 2000
Key Financials for 2000 DKK million 2000 1999 % change Net turnover 20,811 16,423 27 Operating profit as reported 4,816 3,527 37 Net profit 3,087 2,001 54 Earnings per share (DKK) 44.20 27.98 58 Free cash flow 2,712 1,533 77
Slide 45: Margin Development
Margin Development 6000 5000 Production costs Development in gross- and DKK million EBIT-margin 1997-2000 4000 3000 79% 24% 2000 77% 22% 1000 75% 20% 0 73% 18% 1997 1998 1999 2000 71% 16% 7000 Gross margin (left- R&D costs 69% hand scale) 14% 6000 S&D costs EBIT-margin (right- 67% hand scale) 12% DK
Slide 46: Long-term Financial Targets
Long-term Financial Targets Targets set out in 1996 New financial targets EBIT growth of 15% per annum EBIT growth of 15% per annum EBIT margin of 20% EBIT margin of 25% RONFA of 20% per annum ROIC of 25% (post-tax) per annum Positive cash flow Cash to earnings of 60% All reached Balancing by 2000 g
Slide 47: Focus on Shareholder Value
Focus on Shareholder Value Split of shares – effective as of 4 April 2001 1 B share (nom DKK 10) 5 B shares (nom DKK 2 each) 1 ADS (nom DKK 5) 2.5 ADSs (nom DKK 2 each) Reduction in share capital corresponding to 6% of the total capital Share buy-back programme part of the strategy Shareholder v
Slide 48: Increasing Dividend per Share
Increasing Dividend per Share DKK per share 14 Payout ratio = 30% Novozymes’ 12 Dividend per share share of dividend 29% of DKK 13.25 10 23% in 2000 8 Increased 64% from 20% 1999 to 2000 6 adjusting for 4 Novozymes A/S 2 0 1997 1998 1999 2000 Note: Historic dividends are split between Novozymes and
Slide 49: Novo Nordisk – Key Drivers
Novo Nordisk – Key Drivers Diabetes care Coagulation disorders World leader with steady growth Estimated market potential for for 77 years current NovoSeven® indication 2/3 of business (insulin) growing of USD 350 million >10% p.a. Entering 6 new clinical areas with Growth platform in the US 8 new s
Slide 50: Novo Nordisk – Positioned for Growth
Novo Nordisk – Positioned for Growth Consistent, strong organic growth Focused on a few therapeutic areas with large unmet medical needs Well Leadership position in diabetes care and positioned haemostasis management to capture Strong presence in Europe and Japan, future strong growth in US growth P
Slide 51: Forward-looking Statements
Forward-looking Statements This presentation contains forward-looking statements as the term is defined in the US Private Securities Litigation Reform Act of 1995 Such forward-looking statements are subject to risk and uncertainties that may cause actual results to differ materially from expectation
Slide 52: Novo Nordisk – Key Drivers
Novo Nordisk – Key Drivers Diabetes care Coagulation disorders World leader with steady growth Estimated market potential for for 77 years current NovoSeven® indication 2/3 of business (insulin) growing of USD 350 million >10% p.a. Entering 6 new clinical areas with Growth platform in the US 8 new s
Slide 53: Appendix
Appendix
Slide 54: Investor Information
Investor Information Investor Relations Contacts: Share information Novo Nordisk A/S Novo Nordisk’s B shares are listed Investor Relations Novo Allé on the stock exchanges in DK2880 Bagsværd Copenhagen and London. Its Denmark ADSs are listed on the New York Fax (+45) 4444 2314. Stock Exchange under
Slide 55: The Vision of Novo Nordisk
The Vision of Novo Nordisk We will be the world’s leading diabetes care company Our aspiration is to defeat diabetes by finding better methods of diabetes prevention, detection and treatment We will work actively to promote collaboration between all parties in the healthcare system in order to achie
Slide 56: Profit & Loss 1998-2000
Profit & Loss 1998-2000 DKK million 1998 1999 2000 Net turnover 13,647 16,423 20,811 Y/Y growth +8.4% +20.3% +26.7% Gross profit 9,896 12,196 15,767 EBIT 2,933 3,527 4,816 EBIT-margin 21.5% 21.5% 23.1% Net finance 243 -178 24 Pre-tax profit 3,176 3,349 4,840 Tax rate 36.5% 40.3% 36.2% Net profit 2,0
Slide 57: Turnover by Therapy 2000 and 1999
Turnover by Therapy 2000 and 1999 DKK million 2000 1999 % of total 2000 % change Insulin etc 13,491 11,049 65 22 NovoNorm®/Prandin™ 1,087 728 5 49 Diabetes Care, Total 14,578 11,777 70 24 Coagulation disorders* 2,270 1,313 11 73 Growth disorders 2,107 1,721 10 22 HRT 1,306 1,130 6 16 Other 550 482 3
Slide 58: Balance Sheet 1998-2000
Balance Sheet 1998-2000 DKK million 1998 1999 2000 Fixed assets 12,534 10,576 12,065 Stocks 3,253 3,583 3,972 Debtors 4,895 5,481 4,711 Cash and current inv. 1,476 3,442 3,845 Total assets 22,158 23,082 24,593 Shareholder’s funds 15,287 15,185 15,738 Provisions 1,121 1,258 1,493 Long-term debt 997 1
Slide 59: Characteristics of the OAD Market
Characteristics of the OAD Market Low but increasing awareness Novo Nordisk products/projects among decision makers NovoNorm™/Prandin® Low degree of diagnosis Need for education NN622 (currently in Phase 2) Low focus on pharmacoeconomics NN2344 (currently in Phase 2) NN2211 (currently in Phase 2) Ma
Slide 60: The OAD Market and PGR
The OAD Market and PGR OAD market continues to grow strongly The number of treated patients increased by 8.5% in MATQ3.2000 The OAD market increased 18.3% to USD 5.2 bn in MATQ3.2000 New treatment options fuel an increase in combination therapy Growing acceptance in both US and EU, that both insulin
Slide 61: Insulin Secretion in Normal People and People with Type 2 Diabetes
Insulin Secretion in Normal People and People with Type 2 Diabetes 800 Insulin Secretion (pmol/min) 700 Normal Type 2 diabetes 600 500 400 300 200 100 0600 1000 1400 1800 2200 0200 0600 Kilde: O'MEARA et al. Am. J. Medicine, 1990; 89.
Slide 62: Positive Outlook for NovoNorm/Prandin
Positive Outlook for NovoNormTM/Prandin® Strong support for post-prandial blood glucose (PPG) control PPG is an independent risk factor for cardiovascular disease ADA consensus meeting January 2001 Formation of the Diabetic-cardiovascular Initiative (DCVD) Strengthening of clinical profile in progre
Slide 63: Insulin etc: Sales by quarter
Insulin etc Sales by quarter DKK million 4,000 NovoRapid®/NovoLog®: EU: Roll out ongoing 3,000 US: Launch H2 2001 Japan: Filed 2,000 New innovative devices: Innovo®: EU and Japan 1,000 InnoLet®: EU Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 1997 1998 1999 2000
Slide 64: Characteristics of the Insulin Market
Characteristics of the Insulin Market Both Type 1 and Type 2 diabetes Novo Nordisk products/projects Mainly specialist driven, Insulin products but GPs very important in the US Actrapid®, Insulatard®, Few players, large volumes Monotard®, Mixtard®, Ultratard®, Velosulin®, Inexpensive and reimbursed
Slide 65: AERx NN1998 – Pulmonary Insulin
AERx NN1998 – Pulmonary Insulin Pulmonary Insulin Opportunity Non-invasive insulin delivery Mainly poorly controlled Type 2 diabetes patients Expanded insulin sales Product Requirements Accuracy, precision, dose adjustment Patient friendly device interface Scaleable manufacturing Aradigm is the Opti
Slide 66: Diabetes – Source of Innovation
Diabetes – Source of Innovation Clinical research Steno Diabetes Centre Oxford Diabetes Centre Basic research Clinical research centres worldwide Hagedorn Research Institute Evidence-based medicine Oxford and Steno Diabetes Centre NN disease mgt programmes Academic collaborations Outcomes data from
Slide 67: Evolution of a Diabetes Project
Evolution of a Diabetes Project Stable cell lines Chemistry Establish High In vitro Identify & biological throughput biological clone target function screening profile In vivo diabetes models Diabetes Diabetes expertise models PLPc
Slide 68: Diabetes – a Metabolic Syndrome
Diabetes – a Metabolic Syndrome Liver Brain - Hepatic enzyme inh - PPAR - GLP-1. - Glucokinase - Glucagon antagonists - Insulin ß-cell - Insulin mimetics. - PGR - PCO Muscle/Fat - GLP-1. - Insulin sensitisers - Insulin - Insulin mimetics - PPAR Gut - GLUT4 - GLP-1. - TNF - PTPase.
Slide 69: Coagulation Disorders (NovoSeven)
Coagulation Disorders (NovoSeven®) Sales by quarter DKK million Inhibitor indication: 800 Estimated market potential of 600 USD 350 million Launched 400 EU: Feb 1996 USA: April 200 1999 Japan: May 0 2000 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 1997 1998 1999 2000
Slide 70: Registration Status
Registration Status 1996 1997 1998 1999 2000 Austria Brazil Hungary Australia Argentina Belgium Bulgaria Lithuania Bosnia Guatamala Denmark Croatia Poland Canada Japan Finland Cyprus Singapore Costa Rica Russia France Czech Rep Slovenia USA Germany Hong Kong S Korea Greece Israel Taiwan s Ireland Jo
Slide 71: NovoSeven Mechanism of Action
Novoseven® Mechanism of Action rFVIIa Tissue factor (NovoSeven®) - only at site of injury FXa The key impact of NovoSeven® is through Platelet activation injury site selective platelet activation to ensure high local thrombin formation Thrombin activation and burst which secures a tight fibrin clot
Slide 72: Estimated Number of Bleeding Episodes
Estimated Number of Bleeding Episodes Clinical area Orthotopic liver Est number of orthotopic liver transplantations: 8,000 transplantation* Liver resection* Est number of bleeding episodes: 6.000 Upper GI bleeds* Est number of spontaneous upper GI bleeds: 170,000 Reversal of anti- Est no of potenti
Slide 73: E-commerce: Background & Strategy
‘E’-commerce : Background & Strategy Increasing focus on empowered patients & DTC Multiple retail/distribution formats developing Strict regulation of pharma sales/distribution Unique opportunity to gain experience with devices Opportunities of gaining efficencies B2B & B2C We will utilise our devic
Slide 74: Triple Bottom Line
Triple Bottom Line Economically viable Socially Environmentally Responsible sound
Slide 75: Triple Bottom Line (continued)
Triple Bottom Line (continued) Why combine business, environment, and stakeholders? To obtain trust and licence to operate and innovate To attract and retain the most talented people To minimise risks and create possibilities To understand signs from stakeholders To be part of defining new legislati
Slide 76: hOvo Nordisk
5, hOvo Nordisk