Teva Pharmaceutical Industries Limited · TASE:TEVA
Teva Pharmaceutical Industries — UBS Global Life Sciences Conference 2008
36 slides from Teva Pharmaceutical Industries's conference presentation, Sep 24, 2008
Slide 1: Introducing the world leader in generic pharmaceuticals
Introducing the world leader in generic pharmaceuticals Eyal Desheh, CFO UBS Global Life Sciences Conference, Grand Hyatt, New York September 24, 2008
Slide 2: Forward looking statements
Forward looking statements TODAY S PRESENTATION CONTAINS FORWARD-LOOKING STATEMENTS, WHICH EXPRESS THE CURRENT BELIEFS AND EXPECTATIONS OF MANAGEMENT. SUCH STATEMENTS INVOLVE A NUMBER OF KNOWN AND UNKNOWN RISKS AND UNCERTAINTIES THAT COULD CAUSE TEVA'S FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS TO
Slide 3: Today's discussion
Today’s discussion Introducing Teva Financial and strategy update Q&A
Slide 4: Introducing Teva
Introducing Teva Established 1901 $9.4bn 2007 sales ~60 countries ~28,000 employees
Slide 5: Three lines of business
Three lines of business 100%=$9.4bn 6% API API (external (external only) only) synergies 75% Generic Generic pharmaceuticals pharmaceuticals balance 19% Innovative Innovative pharmaceuticals pharmaceuticals (2007)
Slide 6: The world's number 1 generics player
The world’s number 1 generics player Revenues, $ bn, 2007 Teva 9.4 Sandoz 7.4 Mylan 4.6 Barr 2.5 Watson 2.5 RatioPharm 2.4 Stada 2.3 Actavis 1.9 Ranbaxy 1.7 Perrigo 1.4 Dr. Reddy's 1.3 Gedeon R. 1.3 Source: company publications
Slide 7: With a strong branded operation
With a strong branded operation Multiple Multiple Parkinson’s Parkinson’s Respiratory Respiratory sclerosis sclerosis Supports balanced business model Marketing/branding skills for branded generics Highly profitable business
Slide 8: Vertical integration through in-house Teva API
Vertical integration through in-house Teva API In-house API Generic & API Guaranteed quality R&D to maximizes ingredient supply first-to-file pipeline for generics business
Slide 9: Generics is all about scale – Teva is #1
Generics is all about scale – Teva is #1 IMS TRx MAT June, % of total Faster organic growth 39% Others Top 4 65% 61% Big 10% #4 players 11% #3 get bigger Top 4 35% 13% #2 7% 8% 6% Barr 12% 21% #1 - Teva 8% Better at M&A 1997 2007
Slide 10: BIG to BIG: Strategic partnership with customers
Strategic partnership with customers Ranking of prescription volume, total Rx’s, millions, U.S. market Generic Branded Teva 456 17 473 Mylan 294 12 306 Novartis/Sandoz 201 63 264 Pfizer 236 Watson 224 Barr 128 1 Merck 114 GSK 93 Mallinckrodt 91 AstraZeneca 89 BIG to BIG Actavis 85 Greenhouse 84 Apot
Slide 11: Big Gets Bigger – with Barr
Big Gets Bigger – with Barr Ranking of prescription volume, total Rx’s, thousands, U.S. market Generic Branded Teva + Barr 585 17602 Mylan 294 12306 Novartis/Sandoz 201 63 264 Pfizer 236 Watson 224 Merck 114 GSK 93 Mallinckrodt 91 AstraZeneca 89 Actavis 85 Greenhouse Apotex 84 79 BIG to BIG Qualites
Slide 12: R&D to feed the industry's largest pipeline
R&D to feed the industry's largest pipeline U.S., 23 July 2008
Slide 13: Globally diversified business
Globally diversified business 100%= $1.1bn $9.4bn International 6% 10% 4% Israel 25% 28% Europe 20% 58% North America 49% 1997 2007
Slide 14: Focused geographical expansion strategy
Focused geographical expansion strategy Increased Increased Japan, • M&A generics generics use use Southern • Partnerships Europe • Portfolio Mature expansion economies, aging Stable Stable US, • Market share population • Portfolio generics generics use use Western Europe expansion Teva Teva markets
Slide 15: The Japan opportunity
The Japan opportunity • The world’s 2nd pharmaceutical market, with a relatively low generics share • Government aims to double generics use in 5 years
Slide 16: Announcing our strategic partnership in Japan
Announcing our strategic partnership in Japan 50% 50% Global expertise Local expertise $1bn sales in 2015
Slide 17: A platform for growth in Japan
A platform for growth in Japan
Slide 18: Global pharmaceutical supply chain
Global pharmaceutical supply chain Manufacturing facilities Canada (3) UK (2) Netherlands Ireland Poland US (5) France Czech Rep Spain Hungary (2) Mexico (4) Israel (5) Peru Venezuela Chile Argentina
Slide 19: Successful M&A track record
Successful M&A track record Index, 1995 = 100 Barr (global) IVAX (global) (pending) Bentley Dorom (Spain) Sales Sales Net Net (Italy) income CoGenesys income (technology) CAGR CAGR CAGR CAGR RDL 23% 23% 29% 29% (India – API) Honeywell Sicor (Italy) (global) APS Berk Novopharm Bayer Classics (UK) (Ca
Slide 20: 2012 target: reach $20 billion sales
2012 target REACH EXCEED $20 20% billion net income sales margin
Slide 21: Pioneering biogenerics beyond 2012
Pioneering biogenerics beyond 2012 Attractive market Unique Teva assets • > $200bn by 2015 • Israeli and CoGenesys R&D capabilities • Patent expirations – 40% of total value • Financial resources • R&D, marketing • Early on ex-US investments limit activities (biosimilar number of competitors GCS-F -
Slide 22: Barr acquisition – compelling value creation
Barr acquisition – compelling value creation Strong strategic fit Attractive economics + Extend global leadership Expand portfolio / pipeline Exceed 20/20 target
Slide 23: Today's discussion
Today’s discussion Introducing Teva Financial and strategy update Q&A
Slide 24: Overall results for Q2 2008
Overall results for Q2 2008 Q2 2007 Q2 2008 Change Sales 2,386 2,823 +18% $m Net income 515 539 +5% $m EPS 0.63 0.65 +3% $
Slide 25: Overall results for H1 2008
Overall results for H1 2008 H1 2007 H1 2008 Change Sales 4,466 5,359 +21% $m Net income 857 1,068 +25% $m EPS 1.05 1.29 +23% $ * Non-GAAP numbers; Q1’08 includes in process R&D of $382M
Slide 26: Sales growth driven by non-US markets
Sales growth driven by non-US markets Q2 sales, $ million 2007 2008 Change North America - pharma 1,341 1,505 12% Europe - pharma 610 762 25% International - pharma 292 400 37% Total - pharma 2,243 2,667 19% API 143 156 9% Total 2,386 2,823 18%
Slide 27: Growth picking up in all businesses
Growth picking up in all businesses Q2 year-on-year sales growth Q2 ‘07 North America - pharma 6% Q2 ‘08 12% Q2 ‘07 Europe - pharma 16% Q2 ‘08 25% Q2 ‘07 22% International - pharma Q2 ‘08 37% Q2 ‘07 11% Total - pharma Q2 ‘08 19% Q2 ‘07 -1% API 9% Q2 ‘08 Q2 ‘07 10% Total 18% Q2 ‘08
Slide 28: Continued track record of growth – Q2
Continued track record of growth – Q2 3,000 2,823 156 2,386 2,500 400 2,172 143 145 292 2,000 240 762 610 API 1,500 527 Pharma - International 1,227 1,176 133 Pharma - Europe 127 1,000 89 108 Pharma - North America 284 362 1505 1260 1341 500 676 624 0 2004 2005 2006 2007 2008
Slide 29: Copaxone growth accelerating in non-US markets
Copaxone® growth accelerating in non-US markets In market sales Sales growth versus previous period $ million Non-US 563 US 436 Total
Slide 30: Copaxone has become the #1 MS therapy
Copaxone® has become the #1 MS therapy Market share, value, % 32% 25% 25% Copaxone® 25% 24% Avonex® 23% 22% 24% 23% Rebif® 21% Betaseron® 19% Tysabri® 1% 8% 2004 2005 2006 2007 Q2’08
Slide 31: Increasing R&D spend
Increasing R&D spend R&D, in $ millions R&D, as % of sales 7.5% 7.1% 7.0% 6.2% 5.9% 2004 2005 2006 2007 Q2 Q2 2004 2005 2006 2007 2008 2007 2008 target
Slide 32: Increase in cash generation
Increase in cash generation $ million 806 746 132 139 106 545 95 Cash from operations 437 142 Net asset purchase 106 332 79 Dividends distributed 75 104 568 512 73 324 Free cash flow 256 155 Q2 2007 Q3 2007 Q4 2007 Q1 2008 Q2 2008 $410m $410m acquisitions acquisitions
Slide 33: Leverage going down
Leverage going down Selected balance sheet items, $ billion 19.8 19.8 17.6 1.4 2.0 1.5 3.4 3.3 Debt - short-term 4.0 Debt - long-term Equity 14.4 15.1 12.1 30 June 31 March 30 June 2007 2008 2008 Leverage 31% 27% 24%
Slide 34: Summary – or what did we learn?
Summary – or what did we learn? That Teva is the world’s largest Generic company and it is widening the gap from the rest of the pack That we have a vertically integrated, balanced business model which combines generics and innovative products That we have a truly global geographic presence and that
Slide 35: All this worked well for shareholders
All this worked well for shareholders 300 250 200 150 100 50 1/3/03 3/3/03 5/3/03 7/3/03 9/3/03 11/3/03 1/3/04 3/3/04 5/3/04 7/3/04 9/3/04 11/3/04 1/3/05 3/3/05 5/3/05 7/3/05 9/3/05 11/3/05 1/3/06 3/3/06 5/3/06 7/3/06 9/3/06 11/3/06 1/3/07 3/3/07 5/3/07 7/3/07 9/3/07 11/3/07 1/3/08 3/3/08 5/3/08 7/3
Slide 36: Today's discussion
Today’s discussion Introducing Teva Financial and strategy update Q&A
Teva Pharmaceutical Industries — UBS Global Life Sciences Conference 2008 on 6ix