Alcon Ag · SIX:ALC
Alcon — Cowen Healthcare Conference 2004
37 slides from Alcon's conference presentation, Mar 10, 2004
Slide 1: Alcon, Inc.: Worldwide Leader in Ophthalmic Research and Manufacturing
Alcon, Inc. Worldwide Leader in Ophthalmic Research and Manufacturing (travapeos! ophthalmic solution) 0.004%
Slide 2: Safe Harbor Statement
Safe Harbor Statement Statements contained in this presentation that are forward-looking are based on current expectations that are subject to a number of uncertainties and risks, and actual results may differ materially. Alcon does not undertake any obligation to update any of the forward looking s
Slide 3: Investment Dynamics
Investment Dynamics Large & Growing Innovation Markets and Research World’s Leading Eye Care Company Global Reach Financial Performance Market Leadership 3
Slide 4: Investment Dynamics
Investment Dynamics Large & Growing Innovation Markets and Research World’s Leading Eye Care Company Global Reach Financial Performance Market Leadership 4
Slide 5: Large Growing Market
Large Growing Market 2003 2006 Ophthalmic Pharmaceuticals* Otic Pharma Ophthalmic Otic Pharma Pharmaceuticals* Contact $0.6 Contact Lens Care Lens Care $0.5 $1.9 Nasal $1.8 $0.4 Pharma $6.8 $9.0 $3.7 $3.4 Ophthalmic Surgical Ophthalmic Surgical $12.5 $15.6 *Includes OTC Tears, Allergy and Vitamins +
Slide 6: Markets - Favorable Demographics
Markets - Favorable Demographics Population age 65 plus 956 +128% 674 707 +69% 522 +25% 470 419 327 +32% +90% +171% 248 237 282 171 195 +14% +39% +65% 2000 2010 2020 2030 More Developed Less Developed (Millions of people. Source: United Nations) 6
Slide 7: Investment Dynamics
Investment Dynamics Large & Growing Innovation Markets and Research World’s Leading Eye Care Company Global Reach Financial Performance Market Leadership 7
Slide 8: Global Reach
Global Reach •5 Research Centers Alcon Headquarter Offices Alcon Research Facilities •14 Manufacturing Plants Alcon Manufacturing Plant •70 Operating Companies Alcon Operating Company •40 Physician Training Centers •12,000 Employees 8
Slide 9: Investment Dynamics
Investment Dynamics Large & Growing Innovation Markets and Research World’s Leading Eye Care Company Global Reach Financial Performance Market Leadership 9
Slide 10: Competitive Leadership
Competitive Leadership (US $ Millions) 2003 Sales Results Ophthalmic Ophthalmic Contact Pharmaceuticals* Surgical Lens Care $1,586 $1,356 $1,100 $499 $1,000 $644 $339 $295 $468 $461 $307 Alcon Pfizer Allergan Merck B&L Alcon AMO B&L Alcon AMO B&L *Includes OTC Tears, Allergy and Vitamins for consist
Slide 11: Competitive Leadership
Competitive Leadership 2003 Market Shares Surgical Pharmaceutical Contact Lens Care 47% Global Share 20% Global Share 19% Global Share #1 Cataract #1 Allergy #2 Soft Lens Care #1 Vitreoretinal #1 Anti-infective #2 Refractive #1 Anti-inflammatory #1 Combination #1 Generics #2 Artificial Tears (Indivi
Slide 12: Investment Dynamics
Investment Dynamics Large & Growing Innovation Markets and Research World’s Leading Eye Care Company Global Reach Financial Performance Market Leadership 12
Slide 13: Stable Sales Growth
Stable Sales Growth $3.4 Billion •CAGR = 15% for last 25 years •Steady, predictable long-term sales growth •96% of 2003 sales eye related $110 Million 1978 1983 1988 1993 1998 2003 13
Slide 14: Balanced Sales Growth
Balanced Sales Growth (US $ Millions) CAGR Surgical 1999 to 2003 Pharmaceutical $3,407 Consumer $3,009 9.1% $2,748 $2,554 $2,401 48% 49% 8.1% 49% 48% 48% 34% 36% 31% 33% 33% 13.8% 21% 19% 18% 17% 16% 2.6% 1999 2000 2001 2002 2003 14
Slide 15: Balanced Sales Growth
Balanced Sales Growth (US $ Millions) 2003 vs. 2002 Surgical Reported w/o FX Pharmaceutical $3,407 9.0% Consumer $3,009 13.2% $2,748 $2,554 $2,401 48% 49% 10.2% 4.6% 49% 48% 48% 34% 36% 31% 33% 33% 20.1% 17.0% 21% 19% 18% 17% 16% 6.4% 3.9% 1999 2000 2001 2002 2003 (Sales growth excluding the effect
Slide 16: Leveraging Global Operations
Leveraging Global Operations Sales Operating Income +13.2% +24.9% +9.5% $3,407 +19.5% $879 $3,009 $2,748 $704 $589 2001 2002 2003 2001 2002 2003 (US $ Millions - Reported Numbers) 16
Slide 17: Turning Profits into Strong Cash Flow
Turning Profits into Strong Cash Flow Net Earnings Free Cash Flow 915 -175 740 +28.8% +27.4% $740 +45.6% +47.8% $595 $575 701 $467 $394 543 -126 $316 -149 575 394 2001 2002 2003 2001 2002 2003 (Free Cash Flow = Net cash from operating activities less net cash from investing activities. Free cash flo
Slide 18: Investment Dynamics
Investment Dynamics Large & Growing Innovation Markets and Research World’s Leading Eye Care Company Global Reach Financial Performance Market Leadership 18
Slide 19: R&D Investment
R&D Investment As a Percent of Sales 10.3% 10.8% 10.6% $350 Planned investment $324 of $2 billion over the $290 next five years 2001 2002 2003 (US $ Millions) 19
Slide 20: 2003 New Product Launches
2003 New Product Launches Q1 Q2 Q3 Q4 Systane® Tears CustomCornea® Vigamox™ Infiniti™ Vision System AcrySof® Natural CiproDex* Otic *Cipro is a registered trademark and licensed from Bayer AG 20
Slide 21: Systane - Share Performance
Systane® - Share Performance Systane ® Franchise Share Share 5.0 19.6 21.0 4.5 17.8 19.0 4.6 4.0 17.0 3.5 15.0 3.0 13.0 2.5 11.0 2.0 9.0 Systane 1.5 1.2 7.0 Tears Franchise 1.0 5.0 Apr- May- Jun- Jul-03 Aug- Sep- Oct- Nov- Dec- Jan- 03 03 03 03 03 03 03 03 04 (US market share for Systane and Alcon t
Slide 22: Vigamox - Share Performance
VigamoxTM - Share Performance Vigamox All Prescribers Franchise Share Share 14.0 22.4 12.0 20.0 19.6 11.8 10.0 8.0 15.0 6.0 4.0 10.0 2.0 0.3 Vigamox Franchise 0.0 5.0 May-03 Jun-03 Jul-03 Aug-03Sep-03 Oct-03 Nov-03 Dec-03 Jan-04 (US market share for Vigamox and Alcon total branded anti-infective fra
Slide 23: Vigamox Conversion Trend
VigamoxÔ Conversion Trend % of Fluoroquinolone All Prescribers Franchise 100% 80% 60% 40% 52% 49% 49% 47% 20% 43% 37% 27% 0% Jul-03 Aug-03 Sep-03 Oct-03 Nov-03 Dec-03 Jan-04 Vigamox Ciloxan (US conversion trend for Vigamox and Ciloxan) 23
Slide 24: Otic Franchise - Share Performance
Otic Franchise - Share Performance Market Share % All Prescribers 25.0 23.5 24.7 22.7 20.0 17.8 17.8 15.0 15.1 10.0 Feb Mar April May Jun Jul Aug Sep Oct Nov Dec Jan Rolling 12 2002 Rolling 12 2003 (US market share for CiproDex and Cipro HC combined) 24
Slide 25: AcrySof Share Performance
AcrySof® Share Performance Market Share % 60.0 48.6 50.0 45.6 42.3 40.0 40.0 30.0 2000 2001 2002 2003 (US market share for all Acrysof intraocular lenses) 25
Slide 26: Pharmaceutical R&D Pipeline
Pharmaceutical R&D Pipeline 2004 2005 2006+ Status Patanol® QD Filed Trav/tim Combo Filed Brimonidine/Polyquad Phase III RETAANE™ Phase III Patanol® Nasal Phase III 15(S)-HETE (Dry Eye) Phase III Moxi/Dex Pre-Clinical Nepafenac Phase III Approval targets are for U.S. regulatory approvals 2006+ indic
Slide 27: Surgical/Consumer R&D Pipeline
Surgical/Consumer R&D Pipeline 2004 2005 2006+ Status AcrySert® Device Filed CustomCornea® Astig. Filed CustomCornea® Hyper. Advanced AcrySof® Natural Toric Advanced AcrySof® ReSTOR® Advanced New Viscoelastic Advanced AcrySof® Phakic IOL Early New Vit/Ret System Early StableyzTM Irrigating Sol. Acti
Slide 28: RETAANE 15mg Depot
RETAANEÔ 15mg Depot • Compound is an angiostatic cortisene • Inhibits the growth of abnormal blood vessels • Applied to the back of the eye via a curved, blunt- tipped cannula • Requires administration only twice a year • Projected Q4 2004 filing *Investigational device currently in US clinical tria
Slide 29: RETAANE Clinical Results
RETAANEÔ Clinical Results % of Stable* or Improved Vision - All Lesions Eyes 100% 88% 79% 80% 70% 73% 60% 53% 47% 40% 20% 0% 6 Month 12 Month 24 Month p=0.0799 p=0.0323 p=0.0347 RETAANE 15 mg Placebo * Less than 3 lines of vision loss 29
Slide 30: RETAANE Clinical Results
RETAANEÔ Clinical Results % of Stable* or Improved Vision - Predominantly Classic Lesions Eyes 100% 92% 84% 80% 80% 65% 60% 50% 42% 40% 20% 0% 6 Month 12 Month 24 Month p=0.0209 p=0.0100 p=0.0058 RETAANE 15 mg Placebo * Less than 3 lines of vision loss 30
Slide 31: AcrySof ReSTOR IOL
AcrySof® ReSTOR® IOL • Optical vs. mechanical accommodation • Apodized diffractive/ refractive design • Balances near and distance light energy when pupil is small • Increases distance light energy as pupil diameter increases *Investigational device currently in US • Projected Q3 2004 filing clinica
Slide 32: AcrySof ReSTOR Clinical Results: Near and Distance Visual Acuity
AcrySof® ReSTOR® Clinical Results Near and Distance Visual Acuity Binocular 120-180 Days Postoperative 0.6 0.5 20/60 Mean logMar VA 0.4 20/50 0.3 20/40 0.2 20/30 20/25 0.1 0 20/20 20/15 -0.1 Uncorrected Near Uncorrected Vision Distance Vision ReStor (n=125) Control (n=42) 32
Slide 33: AcrySof ReSTOR Clinical Results: Visual Disturbances
Mean Ratings 0 1 2 3 4 5 6 Glare/Flare 7 Night Vision Color Perception Halos Distorted Near Vision ReStor Distorted Far Vision Visual Disturbances Blurred Near Vision Monofocal Blurred Far Vision Double AcrySof® ReSTOR® Clinical Results Vision 33
Slide 34: AcrySof ReSTOR Clinical Results: Spectacle Wear
AcrySof® ReSTOR® Clinical Results Spectacle Wear - Near and Distant Vision How much of the time do you wear glasses for seeing objects close at hand or at a distance? 100 80 % Subjects 60 ReStor 40 Control 20 0 None Some None Some Near Vision Distance Vision 34
Slide 35: Strategic Sales Growth Drivers
Strategic Sales Growth Drivers Aging Global Market Populations Expansion Target Sales Growth 8–10% Market New Products Share Gains 35
Slide 36: Strategic Sales Growth Drivers
Strategic Sales Growth Drivers • Aging populations • Global market expansion R ev e Driv nue Target • Market share gains er s • New products EPS 1.5-2X Sales Growth • Leverage infrastructure gin Mar rs e Driv • Debt reduction • Tax rate improvements 36
Slide 37: Alcon, Inc.
Alcon, Inc. Worldwide Leader J in Ophthalmic Research and Manufacturing