Novartis AG · SIX:NOVN
Novartis — FY2004 Earnings Presentation
11 slides from Novartis's earnings presentation, Jan 20, 2005
Slide 1: Fueled by Innovation
Fueled by Innovation Basel, January 20, 2005 Daniel Vasella, MD Chairman and CEO, Novartis AG Today’s Program 2004 Achievements and Priorities • Results Highlights and Strategy D. Vasella • Pharmaceuticals T. Ebeling • Oncology and Specialty D. Epstein • Consumer Health P. Choffat • Sandoz A. Rummel
Slide 2: Double-Digit Growth Delivers Record Results
Agenda • Highlights 2004 – another record year • A changing environment • Innovation focused strategy 3 FRESCO 2004 / Daniel Vasella / 2005-01-20 / Analysts Double-Digit Growth Delivers Record Results • Continued double-digit Group sales growth +14% in USD • Pharmaceuticals expands USD +15% – Contin
Slide 3: Key Figures
Key Figures in USD m 2004 2003 in % USD in % LC Sales 28 247 24 864 +14 +9 Operating income 6 539 5 889 +11 as % of sales 23.1 23.7 Net income 5 767 5 016 +15 as % of sales 20.4 20.2 EPS (USD) 2.36 2.03 +16 Number of employees 81 392 78 541 change: +4% 5 FRESCO 2004 / Daniel Vasella / 2005-01-20 / A
Slide 4: Operating in a Challenging Environment
Agenda • Highlights 2004 – another record year • A changing environment • Innovation focused strategy 7 FRESCO 2004 / Daniel Vasella / 2005-01-20 / Analysts Operating in a Challenging Environment • Increasing demand • Cost containment Demographics • Parallel imports and reimportation Erosion of • St
Slide 5: Industry's Value Proposition Remains Strong
Industry’s Value Proposition Remains Strong Mortality Mortality improvement • Saving lives improvement Morbidity Morbidity • Innovative treatments reduction reduction • Shortened duration of disease Improved • Decrease in chronic disability Improved quality qualityof oflife life • Improved efficacy
Slide 6: Dramatic Increases in Life Expectancy
Dramatic Increases in Life Expectancy Example – US life expectancy at birth Years 85 83.9 80 77.2 75 New medicines generated 40% of the gain in life expectancy1 achieved in 70 52 countries between 1986 and 2000 65 1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050 1 Average gain of 2 years betwe
Slide 7: Increasing Number of Hypertension Patients
Increasing Number of Hypertension Patients “More than a quarter of the world’s adult population – totalling nearly one billion – had hypertension in 2000, and … this proportion will increase to 29% – 1.56 billion – by 2025.” – The Lancet (January 2005) 13 FRESCO 2004 / Daniel Vasella / 2005-01-20 /
Slide 8: Our Aim – Deliver Value to Patients
Agenda • Highlights 2004 – another record year • A changing environment • Innovation focused strategy 15 FRESCO 2004 / Daniel Vasella / 2005-01-20 / Analysts Our Aim – Deliver Value to Patients New New novel novel High High quality quality OTC OTC alternatives alternatives medicines medicines generi
Slide 9: Pursuing Strategic Objectives & Getting Results
Innovative Drugs and Generics – Complementary From Customer’s Perspective New innovative medicines Generics free Patent up funds for Innovation offers expiration innovative improved treatment medicines options rendering High quality generics obsolete generics Generic obsolescence 17 FRESCO 2004 / Da
Slide 10: Novartis Institute for Biomedical Research Build-Up on Track
Novartis Institute for Biomedical Research Build-Up on Track • Completed new NIBR Headquarters • Hiring exceeding expectations (>800 to date), with world-class scientists • Completed reorganization New Cambridge, MA Global Headquarters of internal global research program − Short- and long-term succe
Slide 11: Strong Patent Protected Portfolio
Strong Patent Protected Portfolio Patent expiries 2004–2008 Share of sales, moving annual total (MAT) Sep 2004 (in %) 60 46 44 41 40 37 35 25 24 22 20 20 18 18 18 17 17 20 13 11 10 0 TH SK I A K ER K E T T M S T IS Z N & J S NG P .I . Y SA D C IS CH O TI S- B LL YE G EI KE ER FI Z D O B B A R A J N