Gsk Plc · LSE:GSK

Gsk — GlaxoSmithKline — Credit Suisse conference November 2010

15 slides from Gsk's conference presentation, November 2010

  1. Slide 1: Andrew Witty, Chief Executive Officer

    Andrew Witty Chief Executive Officer November 2010 1

  2. Slide 2: GSK's '07-'09 patent cliff

    GSK‟s „07 – ‟09 patent cliff £4.2bn 4,500 (18% of turnover) 4,000 3,500 3,000 2,500 2,000 1,500 £0.8bn 1,000 (3% of turnover) 500 0 2006 2009 GSK US turnover for Wellbutrin, Lamictal, Coreg, Zofran, Imitrex, Paxil, Flonase, Requip. 2

  3. Slide 3: GSK's '07-'09 patent cliff + Avandia

    GSK‟s „07 – ‟09 patent cliff + Avandia £4.2bn 4,500 (18% of turnover) 4,000 Avandia Global sales 2006: £1.6bn 3,500 2009: £0.8bn 3,000 2,500 2,000 1,500 £0.8bn 1,000 (3% of turnover) 500 0 2006 2009 GSK US turnover for Wellbutrin, Lamictal, Coreg, Zofran, Imitrex, Paxil, Flonase, Requip. 3

  4. Slide 4: Positive performance and dividend progression through the patent cliff+Avandia

    Positive performance and dividend progression through the patent cliff+Avandia Turnover EPS +3% 140 +2% 120 -9% +19% +10% -3% 100 +9% +2% 80 60 40 20 0 2005 2006 2007 2008 2009 Free cash flow generation Progressive Dividend 6,000 5,000 4,000 3,000 2,000 1,000 0 2005 2006 2007 2008 2009 Dividend CER

  5. Slide 5: GSK's strategic priorities

    GSK‟s strategic priorities 1. Grow a diversified global business 2. Deliver more products of value 3. Simplify the operating model 5

  6. Slide 6: Portfolio of growth businesses with optionality on R&D upside

    Portfolio of growth businesses with optionality on R&D upside 6

  7. Slide 7: Portfolio of growth businesses with optionality on R&D upside

    Portfolio of growth businesses with optionality on R&D upside 7

  8. Slide 8: Investment businesses reaching significant scale and delivering sustained growth

    Investment businesses reaching significant scale and delivering sustained growth 30% of GSK sales generated from expansion markets Derm: 4% of GSK +5% in 9 mths ‟10 Vx: 11% of GSK +7% in 9 mths‟10 Resp: 26% of GSK +2% in 2009 Cx: 19% of GSK +4% in 9 mths ‟10 +5% in 9 mths ‟10 +5% in 2009 CER growth

  9. Slide 9: 2010 YTD Turnover analysis

    2010 YTD Turnover analysis % Change CER Q3 10 9 mths 10 £ million £ million Q3 10 9 mths 10 Total reported 6,813 21,195 -2% +4% Avandia 70 391 -65% -33% Pandemic* 76 1,141 -69% >100% Valtrex 95 436 -75% -60% Total excl. Pandemic, 6,572 19,227 +6% +5% Avandia, Valtrex * Pandemic includes includes Rel

  10. Slide 10: Creating a broader portfolio of potential high value assets as generic exposure declines

    Creating a broader portfolio of potential high value assets as generic exposure declines New products 9 months YTD „10 Horizant • £1.25bn +36% (+55% excluding Rotarix -27%) Benlysta Nimenrix • Pandemic vaccine also added £1.0bn retigabine Menhibrix 2007 2008 2009 2010/11 CER growth rates 10

  11. Slide 11: Organic capital allocation and bolt-on strategy are fundamentally reshaping GSK

    Organic capital allocation and bolt-on strategy are fundamentally reshaping GSK Employees by division SG&A by division Sept 2007 vs June 2010 FY 2007 vs 1H 2010 EM, AP/Japan, US, EU Cx, Vx, Stiefel, ViiV R&D, Mfg, Corp +9,900 -13,700 64% 50% 36% 50% 2007 2010 2007 2010 SG&A excludes legal 11

  12. Slide 12: Bolt-on investments are on track to deliver target ROI

    Bolt-on investments are on track to deliver target ROI £7.8bn of deals assessed 96% of deals on/ahead of track 8000 8000 Terminated Mktd products Under delivering licensing 7000 7000 6000 6000 On track but early 5000 Acquisitions/JVs 5000 4000 4000 3000 3000 2000 2000 On track/ahead CAPEX 1000 1000

  13. Slide 13: R&D is becoming more efficient through better resource allocation and improving output

    R&D is becoming more efficient through better resource allocation and improving output ~25% decrease in Pharma R&D headcount since 2006 >15% decrease in m2 since 2009 Reduced from >30 global CROs and >100 providers to 2 (2010) > 5-fold increase in Biopharm spend since 2006 Late-stage Pharma spend in

  14. Slide 14: Diverse geographic and business mix

    Diverse geographic and business mix Reducing product concentration R&D pipeline optionality Focus on cost reduction Reducing legal exposure Strong cash generation Progressive dividend 14

  15. Slide 15: GlaxoSmithKline

    ia GlaxoSmithKline

GlaxoSmithKline — Credit Suisse conference November 2010 on 6ix