Gsk Plc · LSE:GSK
Gsk — Investor Presentation (2011)
30 slides from Gsk's investor presentation, 2011
Slide 1: GSK Abbas Hussain, President, Emerging Markets
GSK Abbas Hussain President, Emerging Markets 1
Slide 2: GSK FY2010 Turnover £28.4bn
GSK FY2010 Turnover £28.4bn (-1%*) +5% -1% Rest of Consumer Pharma £1.0bn £5.0bn +9% -11% Asia Pac/ Japan Pharma US £3.1bn Pharma £7.6bn Emerging Markets Pharma £3.6bn Europe +22% Pharma ViiV £6.5bn (HIV) £1.6bn -3% -6% CER growth rates; Business performance * Underlying global sales growth excludin
Slide 3: GSK Emerging Markets business
GSK “Emerging Markets” business 85 countries ~13,000 sales reps CIS China MENA India Mexico SSA Latin America Emerging Markets FY2010 £3.6bn (+22%)* = 13% of GSK Group Turnover 3 Note: GSK FY2010 sales excluding pandemic , Avandia and Valtrex turnover was £3.3bn (+20%)
Slide 4: GSK's pharma presence in Emerging Markets
GSK’s pharma presence in Emerging Markets Eastern & CIS Central Europe China MENA India Mexico SSA Asia Pac Latin (excl Japan, Aus, NZ) America + Asia Pac (excl Japan, Australia, NZ), Eastern and Central Europe = £5.0bn (+16%) FY2010 4
Slide 5: GSK's total presence in Emerging Markets
GSK’s total presence in Emerging Markets Rx Cx + £5.0bn FY2010 £1.8bn FY2010 (+16%) (+13%) £6.8bn (+15%) FY2010 24% of GSK Group Turnover 5
Slide 6: GSK Emerging Markets FY2010 turnover
GSK Emerging Markets FY2010 turnover FY2010 £3.6bn (+22%) By region Top markets (+21%) 700 (+93%) Developing World 600 £73m China* 500 MENA £572m (+10%) 400 (+3%) £m (+9%) £1.2bn CIS (+16%) (+25%) (+3%) £242m 300 (+15%) £299m 200 South Asia 100 £235m £962m 0 Brazil China* Russia Turkey Egypt Mexico
Slide 7: Markets representing 80% of GSK EM business
Markets representing 80% of GSK EM business 600 500 Sales £m 400 300 200 100 0 7
Slide 8: Brands representing 80% of GSK EM business
Brands representing 80% of GSK EM business 350 300 250 200 Sales £m 150 100 50 0 8
Slide 9: History of GSK EM sales growth
History of GSK EM sales growth 25% 22% 20% 15% 10% 5% GSK EM sales growth inc pandemic GSK EM sales growth exc pandemic 0% 2003 2004 2005 2006 2007 2008 2009 2010 9
Slide 10: Emerging market characteristics
Emerging market characteristics Large markets Pay out of pocket Need for greater access Smaller products Untapped potential Longevity of brands Evolving healthcare Fast growing programmes 10
Slide 11: EMAP will outgrow Developed Markets
EMAP will outgrow Developed Markets £416bn £336bn Europe, £176bn Europe, £148bn £227bn Assuming Turkey £10bn CAGR: Korea £11bn Mexico £7bn USA / 4% Brazil, £25bn EU / 3% Russia £14bn India £14bn £112bn China USA, USA, £62bn £240bn £188bn Others £75bn Year: 2009 Year: 2015* Source: IMS 2009 - 2014 Gl
Slide 12: EMAP will outgrow Developed Markets
EMAP will outgrow Developed Markets 2009 2015 Other NA Other NA 3% 2% Japan Japan 11% 10% EMAP 22% EMAP 31% USA USA 33% 36% EUROPE EUROPE 28% 24% Source: IMS 2009 - 2014 Global Prognosis Report. Total Pharmaceutical Market * Extrapolations from 2009 to 2015 based on IMS projections Emerging Markets:
Slide 13: Growth in Pharmerging Markets
Growth in ‘Pharmerging Markets’ IMS Tier 1, 2, 3 Pharmerging Markets Incremental Growth 2009-2013 China +$40bn Growth +$5-15bn Russia Brazil GDP PPP Growth India +$1-5bn Turkey Pakistan Egypt Growth Ukraine Venezuela S. Africa Mexico Argentina Thailand Vietnam Indonesia 13
Slide 14: Population with household income above £10,000
Total Population with household income in excess of £10,000 per annum Population (millions) 800 700 600 US/UK Top 11 EM 500 Top 13 EM Top 13 EM 400 Top 11 EM 300 US/UK 2010 2020 Top 11 EM markets: Brazil, Mexico, Chile, Turkey, Venezuela, Saudi Arabia, Argentina, Egypt, Russia, Algeria and Pakistan
Slide 15: Avodart in Russia: Optimal pricing delivers rapid uptake
Avodart in Russia: Optimal pricing delivers rapid uptake Avodart unit growth, BPH market 90% increase # packs in number of units sold Price reduction initiative since Jan 2010 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 2008 2009 2010 15 Source: PharmExpert data
Slide 16: Tykerb in India: Optimal pricing delivers rapid uptake
Tykerb in India: Optimal pricing delivers rapid uptake and fewer discontinuations 700 120 Total Volume (left axis) 50% increase New patients (right axis) in number of 600 units sold 100 Discontinuations (right axis) 500 80 400 60 300 40 200 Price reduction initiative since July 2010 20 100 0 0 Jan F
Slide 17: EM Avamys Repricing Initiative
EM Avamys Repricing Initiative Volume (M) Price GBP 5.0 4.24M* 10.5 12 4.35M 4.5 10 4.0 3.5 -38% 8 6.5 3.0 262% 2.5 6 2.0 4 1.5 1.20M 1.0 2 0.5 0.0 0 2009 2010 Source: SB-14 and market data * Breakeven in margin comparing UP2 2010 volumes and prices given by markets prior of re-pricing Avamys 17
Slide 18: EMAP Region Leading Companies for SU Volume
EMAP Region Leading 10 Companies for SU Volume (Doses) Rank SU (m) Share Growth Emap 748,212 100% 10% GSK 1 42,707 5.7% 12% Novartis 2 29,467 3.9% 5% Sanofi-Aventis 3 25,353 3.4% 9% Pfizer 4 17,091 2.3% 5% Cipla 5 16,484 2.2% 13% Lab Unknown (generics) 6 12,637 1.7% -5% Abbott 7 8,229 1.1% 9% Astraz
Slide 19: EMAP Region Leading Companies (by Value) Average Price
EMAP Region Leading 10 Companies (by Value) Average Price (Pack Price: UN, and Dose Price: SU) Sales (£m) Unit Price (£) SU Price (£) EMAP 87,018 2.08 0.12 Pfizer 4,722 5.12 0.28 Sanofi-Aventis 4,641 3.41 0.18 Novartis 4,287 4.99 0.15 GSK 3,181 1.94 0.07 Merck & Co 3,046 8.74 0.41 Astrazeneca 2,757
Slide 20: Emerging Markets strategy
Emerging Markets strategy FY2010 Turnover Scale up our Classic brands Build and capture the business Vaccines market £1.6bn +18% £927m +38% £701m +14% excl. pandemic Pandemic Drive our Innovative brands £1.0bn +16% 20 ; Source: GSK FY2010 reported sales; CER growth rates
Slide 21: Scale up our Classic brands business
Scale up our Classic brands business Our own portfolio Bolt-on acquisitions Portfolio deals Egypt Oct 08 June 09 Sales (CER Growth) 2007 2010 Pakistan Dec 08 £163m (+11% ) £291m(+15%) Near East July 09 £62m sales 2010 Licensing - July 08 EM/AP Mar 09 £82m sales 2010 Sales (CER Growth) 2007 2010 Loca
Slide 22: Drive our Innovative business
Drive our Innovative business Core portfolio New portfolio Future portfolio FY2010 Turnover FY2010 Turnover New products: Votrient £328m £30m Arzerra (+16%) (+36%) Prolia Benlysta Relovair darapladib £136m £31m (+17%) (+>100%) Targeted R&D developing EM- £55m £10m (+29%) (+43%) specific portfolio Ty
Slide 23: Stiefel opportunity is greatest in EM
Stiefel opportunity is greatest in EM Stiefel acquisition provides access to FY2010 GSK EM Derms Sales ~80% of the EM Derms market £286m (+52%) 80 70 60 50 40 30 20 10 0 23 Source: GSK FY2010 reported sales; CER growth rates
Slide 24: Build and capture the Vaccines market
Build and capture the Vaccines market Significant market GSK has 38% of the growth potential market and is growing faster Growing government attention Total EM Vaccines Market 2010 to public health agenda £2.46bn (+28%) Large birth cohorts for paediatric vaccines £927M(+38%) GSK EM Vaccines 2010 Sig
Slide 25: GSK has the broadest vaccine portfolio in EM
GSK has the broadest vaccine portfolio in EM GSK Merck Sanofi Pfizer Novartis DTPw combos 9 9 9 DTPa combos 9 9 MMR / Varicella 9 9 9 Hepatitis A 9 9 9 Rotavirus 9 9 Meningococcal 9 9 d Pneumococcal 9 9 Influenza 9 9 9 HPV 9 9 Malaria d Dengue d d 25 9 = available in EM; d = Ph III / registration in
Slide 26: Strong launches are building the vaccines business
Strong launches are building the vaccines business The best launch in a decade of new launches in GSK - £149M in 2010 Submitted in 114 & Approved in 78 countries Brazil Fiocruz 10+ year contract Mexico 3 year contract Added to new 6 countries UMV AMC 10 year contract for GAVI countries ($1.3bn) 26
Slide 27: GSK Emerging Markets in 2015
GSK Emerging Markets in 2015 Outgrow the market Evolve our business IMS projects EM market growth Vaccines of 12-14%1 Classic Our objective is to grow faster Innovative than the market2 FY2010 Classic Vaccines Innovative 2015 ambition 1 Source: IMS Market Prognosis (Sept 2010) redefined for GSK EM r
Slide 28: Operating profit margin
Operating profit margin FY2010 Operating Profit Margin1(%) GSK’s reported regional margins exclude R&D and legal expenses which are heavily weighted US 65.9 towards Europe and US EM has been in “investment mode” Europe 57.2 EM margin expected to remain in EM 35.7 mid-30s range AP/J 55.8 1 Operating
Slide 29: GlaxoSmithKline
GlaxoSmithKline
Slide 30: Targeting both Haves and Have Less patients to increase GSK coverage
Targeting both “Haves” and “Have Less” Patients will increase GSK Coverage to almost 50% of the Population* 2010 2020 205 335 5% 8% Have 83 US$25,000+ 30% 153 1,595 37% 42% Have 47% coverage 2,165 Have 61% + 53% coverage Have 88% + Have Less Less Market Value Have 93% US$4,000 – Less US$25,000 159 M