Novo Nordisk A/s Class B · OMXCOP:NOVO_B
Novo Nordisk A/s Class B — 9M 2008 Earnings Presentation
55 slides from Novo Nordisk A/s Class B's earnings presentation, Oct 31, 2008
Slide 1: A focused healthcare company
Investor presentation A focused healthcare company Investor presentation – First nine months of 2008 Deutsche Bank, London, 31 October 2008
Slide 2: Forward-looking statements
Investor presentation First nine months of 2008 Slide no 2 Forward-looking statements Novo Nordisk’s reports filed with or furnished to the US Securities and Exchange Commission (SEC), including this document as well as the company’s Annual Report 2007 and Form 20-F both filed with the SEC in Februa
Slide 3: Agenda
Investor presentation First nine months of 2008 Slide no 3 Agenda • Highlights and strategy • Sales update • R&D update • Financials
Slide 4: Highlights
Investor presentation First nine months of 2008 Slide no 4 Highlights Sales development: • Sales of modern insulins increased by 29% (22% as reported) • Sales of NovoSeven® increased by 14% (6% as reported) • Sales of Norditropin® increased by 13% (8% as reported) • Sales in North America increased
Slide 5: Novo Nordisk's corporate strategy
Investor presentation First nine months of 2008 Slide no 5 Novo Nordisk’s corporate strategy Indications Compounds/Capabilities Strategic focus Insulin • Diabetes Expandleadership Expand leadership GLP-1 Drug delivery and protein expertise Global commercial infrastructure GLP-1 • Obesity/pre-diabete
Slide 6: Insulin world market leader with 52% market share
Investor presentation First nine months of 2008 Slide no 6 Insulin world market leader with 52% market share Europe North America Novo Nordisk #1 Novo Nordisk #1 Market share 56% Market share: 42% International Operations Japan & Oceania Novo Nordisk #1 Novo Nordisk #1 Market share: 59% Market share
Slide 7: Growth in Novo Nordisk's insulin franchise looks set to continue
Investor presentation First nine months of 2008 Slide no 7 Growth in Novo Nordisk’s insulin franchise looks set to continue Rapid increase in number of World insulin market growth people with diabetes 2007 2025 Volume: 6.3% 350 DKK: 11.3% 300 2007: 246 million USD: 18.9% 2025: 380 million 250 GR CA
Slide 8: GLP-1 will explore virgin territory between OADs and insulins
Investor presentation First nine months of 2008 Slide no 8 GLP-1 will explore virgin territory between OADs and insulins World DKK MAT market billion growth OAD 62 -7% OAD Insulin Insulin 56 8% GLP-1 3 12% GLP-1 Note: Absolute data represent MAT August 2008 and growth data represent MAT August 2008
Slide 9: Sales update
Investor presentation First nine months of 2008 Slide no 9 Sales update
Slide 10: Key products continue to drive growth
Investor presentation First nine months of 2008 Slide no 10 Key products continue to drive growth – first nine months of 2008 Sales as reported Growth analysis HRT Norditropin -5% ® Local currencies Growth Share of +8% 4% growth 9% Modern insulins 29% 75% Diabetes care NovoSeven® +7% Human insulins
Slide 11: Modern insulins exhibit steady penetration
Investor presentation First nine months of 2008 Slide no 11 Modern insulins exhibit steady penetration World market share of total segment Modern insulin sales as reported 50% Levemir® NovoRapid® DKK 2.7bn NovoRapid® NovoMix®30 +51% DKK 5.5bn 40% Levemir® +14% 22% 30% 45% 20% NovoMix® 33% DKK 4.0bn
Slide 12: A continued increase in modern insulin market share
Investor presentation First nine months of 2008 Slide no 12 A continued increase in modern insulin market share IMS world modern insulin Modern insulin penetration market shares, volume 70% Novo Nordisk 60% Sanofi-Aventis Eli Lilly 56% 50% 25% Modern insulin 40% 30% Human insulin 20% 10% 0% Q2 Q2 Q2
Slide 13: NovoSeven sales development
Investor presentation First nine months of 2008 Slide no 13 NovoSeven® NovoSeven® sales development Key observations • Growth in the first nine months of 2008 of 1.600 9% 14% in local currencies and 6% as reported CAGR: 1.400 • North American and International Operations sales main contributor to gr
Slide 14: Norditropin sales development
Investor presentation First nine months of 2008 Slide no 14 Norditropin® Norditropin® sales development Key observations • Growth in the first nine months of 2008 of 13% in local 1.000 3% CAGR: 1 currencies and 8% as reported 900 800 • North America main contributor to growth with more than 40% DKK
Slide 15: Sales by region
Investor presentation First nine months of 2008 Slide no 15 Sales by region - first nine months of 2008 Sales as reported Growth analysis Japan & Oceania +2% Europe Local Growth Share of +6% currencies growth 10% International Europe 7% 22% Operations North America 18% 47% +13% 19% 39% International
Slide 16: Levemir reinforces modern insulin market leadership in Europe…
Investor presentation First nine months of 2008 Slide no 16 Levemir® reinforces modern insulin market leadership in Europe… Share of total modern insulin Novo Nordisk’s share of long- sales in Europe acting modern insulin in Europe 80% 30% 70% Novo Nordisk Eli Lilly 25% 60% Sanofi-Aventis 20% 50% 40
Slide 17: … and total market leadership in the US
Investor presentation First nine months of 2008 Slide no 17 … and total market leadership in the US US total insulin market Novo Nordisk’s share of long- share development acting modern insulin in the US 80% 12% 70% Novo Nordisk Eli Lilly 10% 60% Sanofi-Aventis 8% 50% 40% 6% 30% 4% 20% 2% 10% 0% 0%
Slide 18: Increase in number of people with diabetes is driven by International Operations
Investor presentation First nine months of 2008 Slide no 18 Increase in number of people with diabetes is driven by International Operations Rapid increase in number of Number of people with diabetes people with diabetes in most important IO countries 2007 2025 2007 2025 350 80 300 70 Worldwide: 60
Slide 19: Solid leadership position within emerging markets
Investor presentation First nine months of 2008 Slide no 19 Solid leadership position within emerging markets International Operations International Operations insulin insulin sales market shares Index 70% local currencies 59% 300 60% % : 21 Novo Nordisk 250 A GR 50% C Eli Lilly Sanofi-Aventis 200 4
Slide 20: International operations: Increasing importance and share of modern insulins
Investor presentation First nine months of 2008 Slide no 20 International operations: Increasing importance and share of modern insulins Modern insulin’s share of Share of total sales total insulin sales 20% 40% 36% 30% 30% 21% 10% 20% 13% 10% 8% 3% 0% 0% 2003 2004 2005 2006 2007 9M 2003 2004 2005 2
Slide 21: Significant share of people with diabetes remain untreated in China
Investor presentation First nine months of 2008 Slide no 21 Significant share of people with diabetes remain untreated in China Diabetes prevalence in China Treatment of diabetics in China New studies on diabetes prevalence 100% 40 trends Million people • 2% rural towns 30 • 4% small/medium cities 2
Slide 22: Volume drives significant growth in China with increasing modern insulin conversion
Investor presentation First nine months of 2008 Slide no 22 Volume drives significant growth in China with increasing modern insulin conversion Chinese insulin market growth is More than 1% conversion in driven by volume growth each of the latest six quarters In value In volume Modern insulin Volume
Slide 23: Solid insulin leadership position in China
Investor presentation First nine months of 2008 Slide no 23 Solid insulin leadership position in China China insulin sales China insulin market shares Index local currencies 70% 62% 600 60% Novo Nordisk 7% 50% 500 R:3 Eli Lilly C AG Sanofi-Aventis 400 40% Sh. Biochem & Phar 300 30% JS. Wanbang Bioch
Slide 24: R&D update
Investor presentation First nine months of 2008 Slide no 24 R&D update
Slide 25: Development portfolio – diabetes and obesity
Investor presentation First nine months of 2008 Slide no 25 Development portfolio – diabetes and obesity Compound Type Indication Phase NovoMix® 50 Modern insulin Type 1+2 Launched in Europe, approved in the US NovoMix® 70 Modern insulin Type 1+2 Launched in Europe, filed in Japan PrandiMetTM OAD Ty
Slide 26: Promising phase 2 results for the new generation of insulins
Investor presentation First nine months of 2008 Slide no 26 Promising phase 2 results for the new generation of insulins NN5401 NN1250 Profile: Profile: • Neutral, soluble dual-acting insulin analogue • Basal insulin analogue with potential preparation with potential duration of action duration of a
Slide 27: LEAD 14-week extension: shifting patients to Victoza improves glycaemic control
Investor presentation First nine months of 2008 Slide no 27 LEAD 6 14-week extension: shifting patients to Victoza® improves glycaemic control • Statistically significant improvements Victoza® -> Victoza® 9,0 for patients switching from exenatide Exenatide -> Victoza® to Victoza®: 8,5 • HbA1c decrea
Slide 28: LEAD data show significantly lower nausea rates for Victoza compared to exenatide
Investor presentation First nine months of 2008 Slide no 28 LEAD 6 data show significantly lower nausea rates for Victoza® compared to exenatide Proportion of subjects with nausea by • The most frequently reported week and treatment adverse event was nausea • Victoza®: the percentage of Proportion o
Slide 29: Development portfolio – haemostasis
Investor presentation First nine months of 2008 Slide no 29 Development portfolio – haemostasis Compound Indication Phase NovoSeven® Room-temperature stable formulation Launched in US and EU and filed in Japan rFXIII Congenital deficiency Phase 3 NN1731 Fast-acting factor VIIa analogue Phase 2 NN712
Slide 30: Development portfolio - other biopharmaceuticals
Investor presentation First nine months of 2008 Slide no 30 Development portfolio - other biopharmaceuticals Compound Indication Phase Activelle® Low Dose Hormone replacement therapy Launched in the US, Positive CHMP opinion Vagifem® Low Dose Hormone replacement therapy Filed in the US, phase 3 in E
Slide 31: Financials
Investor presentation First nine months of 2008 Slide no 31 Financials
Slide 32: Financial results
Investor presentation First nine months of 2008 Slide no 32 Financial results DKK million 9M 2008 9M 2007 % change Sales 32,970 30,885 7 Gross profit 25,397 23,693 7 Gross margin 77.0% 76.7% Sales and distribution costs 9,308 9,151 2 Percent of sales 28.2% 29.6% Research and development costs 5,417
Slide 33: Solid gross margin development
Investor presentation First nine months of 2008 Slide no 33 Solid gross margin development Gross margin improvement analysis Key observations 80% Annual average • Productivity gains are prime 78% contributor – reflecting significant 77.0 improvements in insulin 76.6 76% production efficiency 75.3 74
Slide 34: Currency development
Investor presentation First nine months of 2008 Slide no 34 Currency development Spot rates Quarterly average Annual average 650 650 Annual impact on operating USD/DKK 600 600 profit of a 5% movement in currency (DKK million) 550 550 2008 2009 USD 470 530 500 500 USD-related 100 120 JPY 140 150 450
Slide 35: Financial outlook
Investor presentation First nine months of 2008 Slide no 35 Financial outlook • Sales growth expectations: Key currency rates • Between 11-13% in local currencies DKK 2007 YTD 2008 Current per 100 average average* rate* • Around 3%-points negative currency impact USD 545 497 583 • Operating profit g
Slide 36: Novo Nordisk - concluding remarks
Investor presentation First nine months of 2008 Slide no 36 Novo Nordisk - concluding remarks Strategic position Key growth drivers #1 in the global insulin market • Leadership in diabetes care with full portfolio of modern insulins #1 in the global modern insulin segment • Promising GLP-1 compound
Slide 37: Investor information
Investor presentation First nine months of 2008 Slide no 37 Investor information Share information Investor Relations Novo Nordisk’s B shares are listed contacts on the stock exchanges in Novo Nordisk A/S Investor Relations Copenhagen and London. Its ADRs Novo Allé, DK-2880 Bagsværd are listed on th
Slide 38: Appendices
Investor presentation First nine months of 2008 Slide no 38 Appendices
Slide 39: Cash returned to shareholders
Investor presentation First nine months of 2008 Slide no 39 Cash returned to shareholders Dividend and payout ratio Share repurchase programme 35% 5.0 35 5 5 4.8 4.7 Dividend per share, DKK 4.5 33 4 4 Payout ratio, % DKK billion 3.0 31 3 3 29 2 2 Payout ratio 27 Dividend per share 1 1 25 0 0 2003 20
Slide 40: Long-term financial targets
Investor presentation First nine months of 2008 Slide no 40 Long-term financial targets Performance against long-term financial targets Financial In % 2003 2004 2005 2006 2007 targets Operating profit growth 8.4 8.7 15.9 12.7 (1.9) 15 Operating profit growth excl AERx®1) - - - - 12.6 Operating margi
Slide 41: Solid insulin market growth
Investor presentation First nine months of 2008 Slide no 41 Solid insulin market growth - Novo Nordisk market leadership Market size Growth rates Novo Nordisk market share Market Novo Nordisk US 6,3% 42% 34% 6,4% Europe 2,1% 46% 56% 4,6% Japan 2,5% 72% 4% 4,0% World 4,5% 52% 100% 6,5% Note: Volume d
Slide 42: European modern insulin conversion - NovoRapid
Investor presentation First nine months of 2008 Slide no 42 European modern insulin conversion - NovoRapid® Modern insulin penetration short-acting segment Share of short-acting segment 40% NovoRapid® 35% 30% Human insulin 25% Humalog 20% 62% 15% Modern insulin 10% Apidra 5% 0% Q2 Q2 Q2 Q2 2003 2008
Slide 43: European modern insulin conversion - NovoMix
Investor presentation First nine months of 2008 Slide no 43 European modern insulin conversion - NovoMix® 30 Modern insulin penetration premixed segment Share of premixed segment 35% NovoMix® 30 30% 25% Human insulin 20% 15% Humalog Mix 25 & 50 47% 10% Modern insulin 5% 0% Q2 Q2 Q2 Q2 2003 2008 2003
Slide 44: European modern insulin conversion - Levemir
Investor presentation First nine months of 2008 Slide no 44 European modern insulin conversion - Levemir® Modern insulin penetration Novo Nordisk’s share of long- long-acting segment acting modern insulin in Europe 30% 27% 25% Human insulin 20% 15% 59% 10% Modern insulin 5% 0% Q2 Q2 Q1 Q2 2003 2008
Slide 45: US modern insulin conversion - NovoLog
Investor presentation First nine months of 2008 Slide no 45 US modern insulin conversion - NovoLog® Modern insulin penetration short-acting segment Share of short-acting segment 50% 40% NovoLog® Human insulin 71% 30% Humalog 20% Modern insulin 10% Apidra 0% Q2 Q2 Q2 Q2 2003 2008 2003 2008 Note: Quar
Slide 46: US modern insulin conversion - NovoLog Mix 70/30
Investor presentation First nine months of 2008 Slide no 46 US modern insulin conversion - NovoLog® Mix 70/30 Modern insulin penetration premixed segment Share of premixed segment 30% 25% NovoLog® Mix 70/30 Human insulin 20% 15% Humalog Mix 25 & 50 10% 36% 5% Modern insulin 0% Q2 Q2 Q2 Q2 2003 2008
Slide 47: US modern insulin conversion - Levemir
Investor presentation First nine months of 2008 Slide no 47 US modern insulin conversion - Levemir® Modern insulin penetration Novo Nordisk’s share of long- long-acting segment acting modern insulin in the US 11% 10% 9% Human insulin 8% 7% 71% 6% 5% 4% 3% 2% Modern insulin 1% 0% Q2 Q2 Q2 Q2 2003 200
Slide 48: Insulin segmentation - Europe and the US
Investor presentation First nine months of 2008 Slide no 48 Insulin segmentation - Europe and the US Europe US 60% 60% 50% 50% 40% 40% 30% 30% 20% Long-acting 20% Long-acting Premix Premix 10% 10% Short-acting Short-acting 0% 0% Q2 Q2 Q2 Q2 2003 2008 2003 2008 Note: Quarterly volume data Source: IMS
Slide 49: Insulin segmentation - Japan
Investor presentation First nine months of 2008 Slide no 49 Insulin segmentation - Japan Japan 60% 50% 40% 30% 20% Long-acting 10% Premix Short-acting 0% Q2 Q2 2003 2008 Note: Quarterly volume data Source: IMS
Slide 50: Innovation across multiple dimensions enables promising future R&D portfolio
Investor presentation First nine months of 2008 Slide no 50 Innovation across multiple dimensions enables promising future R&D portfolio Future assets • Next generation insulins Commercial assets Action • Next generation devices • NovoRapid® • Short-acting rFVIIa analogue Next generation • Long-acti
Slide 51: Biosimilars compete in a declining segment
Investor presentation First nine months of 2008 Slide no 51 Biosimilars compete in a declining segment Modern insulin 56% Patent protected Human insulin Q2 2003 Q2 2008 Q2 2012 Notes: Quarterly volume data. From Q1 2008 onwards it is estimated that 6% of the market will be converted each year and th
Slide 52: Insulin secretion
Investor presentation First nine months of 2008 Slide no 52 Insulin secretion 800 People without diabetes Insulin Secretion (pmol/min) 700 Type 2 diabetes 600 500 400 300 200 100 0600 1000 1400 1800 2200 0200 0600 Source: O'MEARA et al. Am. J. Medicine, 1990; 89.
Slide 53: Superior dosing accuracy of FlexPen
Investor presentation First nine months of 2008 Slide no 53 Superior dosing accuracy of FlexPen® Key observations • Dosing accuracy was tested at 5, 10 and 30 unit doses • At all doses, FlexPen® delivered mean doses closer to the intended dose than SoloStar® • The difference between pens was statist
Slide 54: Attractive profile of rFVIIa analogue
Investor presentation First nine months of 2008 Slide no 54 Attractive profile of rFVIIa analogue Velocity (mm*100/sec) 20 Severe haemophilia A + rFVIIa 2 µg/mL + NN1731 2 µg/mL Healthy male • NN1731 has been found to 15 induce a faster rate of thrombin formation than 10 obtainable with NovoSeven® •
Slide 55: NovoSeven - a unique mechanism of action
Investor presentation First nine months of 2008 Slide no 55 NovoSeven® - a unique mechanism of action FVIIa/NovoSeven® Faster haemostasis leads to Tissue factor • Fewer transfusions / transfusion- free surgery • Reduced re-bleeding • Faster recovery • Reduced morbidity and mortality • Improved quali