Orion Oyj Class A · OMXHEX:ORNAV
Orion Oyj Class A — Investor Presentation (February 2020)
67 slides from Orion Oyj Class A's investor presentation, February 2020
Slide 1: Orion Investor Presentation
Orion Investor Presentation
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements which involve risks and uncertainty factors. These statements are not based on historical facts but relate to the Company’s future activities and performance. They include statements about future strategies and anticipated benefits of
Slide 3: Content
Content 1) Orion in brief 2) Highlights of 1−12/2019 3) R&D 4) Sustainability 5) Appendices 6) Financial calendar Investor Presentation © Orion Corporation 3
Slide 4: Orion in brief
Orion in brief
Slide 5: Key messages
Key messages 11 3 5 Orion develops, Growth targeted Strong position in manufactures and through new the Nordic markets human in-house developed generics market. and animal drugs. pharmaceuticals, and APIs. Products marketed in >100 countries. 6 Core therapy areas 22 4 4 Balanced business Strong mode
Slide 6: Orion at a glance (2019 figures)
Orion at a glance (2019 figures) Net sales Sales by business Sales by market area 1,051 MEUR Operating profit 5% 2% 12% 8% 253 MEUR 39% 10% 29% Personnel 3,265 R&D investments 46% 119 MEUR 32% 17% 6 production sites in Finland Proprietary Products Finland Specialty Products Scandinavia Own sales uni
Slide 7: Orion's development
Orion’s development Net sales Operating profit EUR million EUR million 1 200 12% 350 35% 1 000 9% 300 30% 800 6% 250 25% 200 20% 600 3% 150 15% 400 0% 100 10% 200 -3% 50 5% 0 -6% 0 0% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2
Slide 8: Orion's business units
Orion’s business units Contract Proprietary Products Specialty Products Animal Health Fermion manufacturing In-house developed Generic prescription Own animal drugs for Active pharmaceutical Production for other drugs and other drugs drugs, OTC and non- global markets. Other ingredients (APIs) for p
Slide 9: Outlook for 2020
Outlook for 2020 Net sales Orion estimates that in 2020 the net sales will be at a similar level as in 2019 (the net sales in 2019 were EUR 1,051 million). Operating profit The operating profit is estimated to be lower than in 2019 (the operating profit in 2019 was EUR 253 million). Investor Present
Slide 10: Orion's strategic growth target and financial objectives
Orion’s strategic growth target and financial objectives Strategic growth target: Net sales EUR 1.5 billion in 2025 Financial objectives: Growing net sales more rapidly ≥ than growth of the pharma market. Achievement of this objective requires continuous investment in development of the product Ke
Slide 11: Key elements of Orion's growth
Key elements of Orion’s growth Animal Support Proprietary Health growth Products Growth drivers and R&D APIs for R&D and Fermion Proprietary Generate cash Products flow to fund Specialty Products growth Less vulnerable investments Defensive to Support growth industry macroeconomic volatility Investo
Slide 12: New Proprietary Products and R&D pipeline as growth drivers
New Proprietary Products and R&D pipeline as growth drivers OPPORTUNITIES THREATS/CHALLENGES Generic Darolutamide competition mHSPC* Easyhaler® tiotropium* ODM-109* Animal Health R&D* Pricing pressure In-licensing and product acquisitions Tightening competition Expansion to new geographic market are
Slide 13: Orion's key clinical drug development projects
Orion's key clinical drug development projects Project Indication Phase Registration Easyhaler® tiotropium COPD Bioequivalence study Darolutamide 1) ARAMIS trial Prostate cancer (nmCRPC) I II III Registration Darolutamide 1) ARASENS trial Prostate cancer (mHSPC) I II III ODM-109 (oral levosimendan)
Slide 14: Orion had ~67,000 shareholders on 31 December 2019
Orion had ~67,000 shareholders on 31 December 2019 By number of shares By number of votes Households (Finnish 3% 0% retail) 2% 0% 5% 9% 8% Non-Finnish holders and 6% nominee-registered 6% Private corporations 40% 13% Public sector 60% Non-profit institutions 9% 38% Financial and insurance corporatio
Slide 15: Largest shareholders by votes and shares on 31 December 2019
Largest shareholders by votes and shares on 31 December 2019 # Shareholder % of votes Number of votes # Shareholder % of shares Number of shares 1 Erkki Etola and companies 6.07 50,500,000 1 Ilmarinen Mutual Pension Insurance Company 2.65 3,739,277 2 Maa- ja vesitekniikan tuki r.y. and companies 5.0
Slide 16: Orion B share performance January 2016 – January 2020
Orion B share performance January 2016 – January 2020 Index 31/12/2015=100 65 195 60 180 55 165 Share price, EUR 150 50 45 Orion B 135 Index Orion B total return 120 40 Europe/Pharmaceutical 105 35 OMXH-portfolio 90 30 Orion B share price 75 25 60 20 31-Dec-15 31-Mar-16 30-Jun-16 30-Sep-16 31-Dec-16
Slide 17: Highlights in January-December 2019
Highlights in January-December 2019
Slide 18: Darolutamide dominated news flow in 2019
Darolutamide dominated news flow in 2019 1 Darolutamide received MA in the USA and Brazil. In Japan, MA in Jan/2020. CHMP recommendation for 3 All business units reported growth in net sales. darolutamide in EU. Darolutamide showed statistically significant REFALS patient recruitment improvement in
Slide 19: Key figures 1−12/2019
Key figures 1−12/2019 Net sales Operating profit Operating profit Cash flow per share margin before financial items* 1,051 253 24% 1.68 MEUR (977) MEUR (253) (26%) EUR (2.32) +8% -27% *) Comparison period cash flow per share before financial items includes both continuing and discontinued operations
Slide 20: Development of net sales and operating profit
Development of net sales and operating profit Net sales Operating profit 10 5 1,051 40 -3 -29 13 8 19 -18 14 -12 45 253 3 253 977 -13 -8 * Product sales without sales margin and product mix change and exchange rate effect *** Exchange rate effect on gross margin ** Product sales margin and product m
Slide 21: Geographical breakdown and development of net sales
Geographical breakdown and development of net sales 1-12/2019 MEUR 1-12/2019 1-12/2018 12% 400 +10% 29% 350 -1% 10% 300 250 +14% -13% 200 +76% 150 32% 17% 100 50 Finland Scandinavia 0 Other Europe North America ROW Investor Presentation © Orion Corporation 21
Slide 22: All business units showed growth
All business units showed growth 1−12/2019 1−12/2018 1-12/2019 MEUR +3% 600 +14% 5% 2% 486 473 8% 500 406 400 357 39% 300 +7% 200 +8% 46% +11% 86 80 100 55 51 18 16 Proprietary Products 0 Specialty Products Specialty Proprietary Animal Fermion CM* & Animal Health Products Products Health other Fermi
Slide 23: Best-selling pharmaceuticals 1−12/2019
Best-selling pharmaceuticals 1−12/2019 Net sales Change vs. . Indication EUR million 1−12/2018 1. Asthma, COPD 104 +16% 2. Parkinson’s disease 98 -3% 3. Acute heart failure 68 +14% 4. Intensive care sedative 57 -10% Rheumatoid arthritis, inflammatory 5. Biosimilars bowel diseases, lymphoma 38 +52% 6
Slide 24: Proprietary Products
Proprietary Products
Slide 25: Easyhaler® product family and Simdax® growing
Easyhaler® product family and Simdax® growing Proprietary Products +16% -3% sales split 1-12/2019 MEUR 120 104 100 98 19% 100 90 -10% +14% 24% 80 68 63 59 57 60 40 17% 20 26% 0 14% Easyhaler® Parkinson Dexdor® Simdax® Parkinson Easyhaler® franchise Dexdor® Simdax® 1−12/2019 1−12/2018 Muut Investor P
Slide 26: Easyhaler® sales exceeded EUR 100 million
Easyhaler® sales exceeded EUR 100 million Sales, EUR million 35 ● Budesonide-formoterol Easyhaler® +21% 30 continued strong growth. 25 20 ● Product family total sales : +16% 15 10 ● Salmeterol-fluticasone sales developed slower than anticipated. 5 0 ● Development of Easyhaler® tiotropium continues.
Slide 27: Share of Orion's own sales in Parkinson increased
Share of Orion’s own sales in Parkinson increased Sales, MEUR million 50 45 40 35 30 25 20 15 10 5 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2014 2015 2016 2017 2018 2019 Orion's own sales Parkinson (Stalevo®, Comtan®) deliveries to partners Investor Presentation © Or
Slide 28: Sales of Dexdor® declining due to generic competition
Sales of Dexdor® declining due to generic competition Total value of European sedatives market: EUR 595 million (+4%) Sales, EUR million 12% 20 18 16 12% 14 66% 12 10 8 10% 6 4 2 Propofol 393 Meur (+7%) 0 Midazolam 61 Meur (-2%) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Dexmedetomi
Slide 29: Specialty Products
Specialty Products
Slide 30: Specialty Products: tight price competition continued
Specialty Products: tight price competition continued Development of net sales Net sales by region Net sales by products 1−12/2019 1−12/2019 MEUR -0% 8% 300 272 273 12% 250 14% 24% 200 +28% +2% 150 56% 89 100 69 68 18% 66 68% 50 0 Finland Generic drugs Finland Scandinavia Eastern Scandinavia Europe
Slide 31: Price competition and product deficiencies behind decline of reference priced drugs in Finland
In Finland, price competition and product deficiencies behind the market decline of reference priced prescription drugs The market of reference priced The sales of Orion's reference prescription drugs in Finland priced prescription drugs (1−12/2019) in Finland MEUR 436 (455) MEUR 116 (123) Market de
Slide 32: Orion is strong in home market Finland
Orion is strong in home market Finland Human pharma market in Finland 1−12/2019 Reference Self-care Medicinal and non-medicinal products priced products in hospital and pharmacy channels: EUR 2,859 million prescription Orion market share in MEUR drugs pharmacy 350 314 Orion market share in 300 pharm
Slide 33: Orion's key business targets in 2019-2020
Orion's key business targets in 2019-2020 Commercialisation of darolutamide in • MA received in USA, Japan and Brazil. Positive CHMP Europe. ARASENS trial (metastatic 1. prostate cancer) continues in order to recommendation in EU. expand the indication for the molecule. • Fully recruited ARASENS tri
Slide 34: Orion's key business targets in 2019-2020 (continued)
Orion's key business targets in 2019-2020 Strengthening Orion’s position as the most • Orion clear market leader in significant provider of generic drugs in reference priced prescription 3. Finland. Competitive product portfolio in drugs in Finland. Specialty Products and strengthening of • In self-
Slide 35: Material themes of Orion's sustainability
Material themes of Orion’s sustainability Ensuring patient safety and reliable supply of medications. Responsibility for the environment, employees and the ethics and transparency of operations. Customer Audits undertaken Greenhouse gas Energy savings Injury rate complaints by Orion emissions (scope
Slide 36: Research and development
Research and development
Slide 37: Focus areas of Orion's R&D
Focus areas of Orion’s R&D Proprietary products Animal Health Fermion • Central nervous system • Orion utilises the • APIs to Orion’s • Oncology R&D of proprietary proprietary products • Respiratory products to develop • Generic APIs (Easyhaler® product family) new medicines for • Contract developme
Slide 38: Proprietary human pharmaceuticals developed by Orion
Proprietary human pharmaceuticals developed by Orion Fareston® * *) Nubeqa® currently only approved in the USA Investor Presentation © Orion Corporation 38
Slide 39: Together we can achieve more in R&D
Together we can achieve more in R&D Late stage Research Early development development Target Hit to Lead Lead Candidate Phase I Phase II Phase III identification generation optimisation selection, and validation preclinical development 8‒24 mo. 12‒24 mo. 18‒36 mo. 12‒24 mo. 12‒14 mo. 12‒36 mo. 18‒48
Slide 40: Orion's key clinical drug development projects
Orion's key clinical drug development projects Project Indication Phase Registration Easyhaler® tiotropium COPD Bioequivalence study Darolutamide 1) ARAMIS trial Prostate cancer (nmCRPC) I II III Registration Darolutamide 1) ARASENS trial Prostate cancer (mHSPC) I II III ODM-109 (oral levosimendan)
Slide 41: Key findings of ARAMIS phase III trial
Key findings of ARAMIS phase III trial: Darolutamide shows substantial efficacy and favourable safety profile Metastasis free Time to pain survival1 (months) progression1 (months) ● Darolutamide showed a statistically significant improvement in overall 40.4 40.3 HR=0.41 HR=0.65 survival (OS). Detail
Slide 42: ARASENS trial aims to expand darolutamide indication to mHSPC
ARASENS trial aims to expand the indication of darolutamide to metastatic hormone-sensitive prostate cancer (mHSPC) Treatment Primary endpoint Estimated Darolutamide + Fully recruited completion in ADT + six cycles Overall Survival 2022e of docetaxel Secondary endpoints: Time to castration resistanc
Slide 43: Financial impacts of darolutamide and regulatory update
Financial impacts of darolutamide and regulatory update ● Bayer has the right to commercialize ● Darolutamide has been approved for the darolutamide globally. treatment of nmCRPC in ● Orion will co-promote in several European ● USA – July 2019 countries. Orion will manufacture the product. ● Brazil
Slide 44: No effective treatment options for non-metastatic CRPC patients
Until recently, there have been no effective treatment options for CRPC patients who have rising Prostate-Specific Antigen (PSA) levels while on ADT and no detectable metastases Non-metastatic CRPC 21
Slide 45: Global prostate cancer estimates (2018)
Global prostate cancer estimates (2018) 70 12nd 35th 5 most commonly leading cause of diagnosed death from cancer malignancy in men 50 60 70 80 in men worldwide 50 60 70 80 21.2 million men 358,000 died from 4 6 50+ Mainly affects men diagnosed with the disease over 50, the risk prostate cancer incr
Slide 46: ODM-109: Oral levosimendan for ALS
ODM-109: Oral levosimendan for ALS By enhancing respiratory muscle function in ALS patients, orally administered levosimendan can help maintain breathing capacity and benefit overall functioning of ALS patients. Levosimendan has been used (Simdax®) for the treatment of acute decompensated heart fail
Slide 47: REFALS patient recruitment completed
REFALS patient recruitment completed 104 ALS centres in 14 countries • REFALS is an Orion study Primary endpoints • 1st patient randomised July 2018 • 12 weeks: Slow vital capacity • Last patient randomisation in July 2019 (Breathing – Study results expected in H2 2020 capacity compared • Number of
Slide 48: ALS as a rare disease
ALS (Amyotrophic lateral sclerosis) as a rare disease 1−2∕ ~16,000 ~12,500 ~450−500 100,000 Patients Incidence Patients Patients in the US in Europe in Finland Investor Presentation © Orion Corporation 48
Slide 49: CYP11A1 inhibitors (ODM-208 & ODM-209)
CYP11A1 inhibitors (ODM-208 & ODM-209) First-in-class compounds Potential indications ODM-208 & ODM-209 prevent Prostate Breast the synthesis of ALL steroid hormones Cancer Cancer Glucocorticoids and mineralocorticoids need to Endometrial cancer of the uterus be replaced during therapy Adrenocortica
Slide 50: Orion investigates CYP11A1 inhibitors in two first-in-human Phase I-II trials
Orion investigates CYP11A1 inhibitors in two first-in-human Phase I-II trials The CYPIDES trial (ODM-208) ● Steroid hormones stimulate the growth of hormonally regulated cancers, such as most • Advanced prostate cancer that prostate and breast cancers. progressed during one or more novel hormonal th
Slide 51: Sustainability is built into Orion's mission
Sustainability is built into Orion’s mission
Slide 52: Key themes of corporate responsibility
Key themes of corporate responsibility Responsibility Ensure patient for the environment Ethics and safety and – production according Taking care of transparency of availability of to the principles Orionees operations medicines of sustainable development 52
Slide 53: This is how we are building well-being responsibly
This is how we are building well-being responsibly WE PRODUCE 1/3 OF THE GLOBAL SUPPLY OF ~200-300 NUMBER OF AUDITS CUSTOMER METHOTREXATE ANNUALLY COMPLAINTS IN 2019 76 (ppm) ORION’S FOCUS ON QUALITY THROUGHOUT THE LIFECYCLE PATIENT R&D RAW MANUFACTURING PACKING DELIVERY SALES PATIENT RECYCLING NEED
Slide 54: Appendices
Appendices
Slide 55: Track record vs. financial objectives
Track record vs. financial objectives Net sales Operating profit Dividend 35% 1,60 1 200 12% 300 30% 1,55 1 000 9% 250 1,50 25% 800 6% 200 1,45 20% 1,40 600 3% 150 15% 1,35 400 0% 100 1,30 10% 1,25 200 -3% 50 5% 1,20 0 -6% 0 0% 1,15 2012 2013 2014 2015 2017 2018 2016* 2019** 2012 2017 2013 2014 2015
Slide 56: Key figures by quarter
Key figures by quarter Net Netsales, sales,EUR EURmillion million Operating Operating profit, profit, EUREUR million million 1 500 Q4 400 Q4 1 000 279 300 59 Q3 262 266 264 274 Q3 51 71 55 239 259 242 284 200 92 69 Q2 222 Q2 59 55 500 45 91 255 273 261 246 252 74 84 71 Q1 100 70 52 260 262 266 247 2
Slide 57: Key figures
Key figures Change vs. Orion’s key figures 2014 2015 2016 2017 2018 2019 2018 Net sales, EUR million 1,015.3 1,015.6 1,073.5 1,033.6 977.5 1,051.0 +7.5% EBITDA 293.9 308.9 +5.1% Operating profit, EUR million 272.4 266.6 314.6 284.1 252.8 252.8 Profit before taxes, EUR million 267.8 262.3 310.9 277.7
Slide 58: Income statement
Income statement Change vs. Formation of profits, EUR million 2014 2015 2016 2017 2018 2019 2018 Net sales 1,015.3 1,015.6 1,073.5 1,033.6 977.5 1,051.0 +7.5% Cost of goods sold -401.7 -405.8 -421.7 -417.6 -387.9 -417.6 +7.7% Gross profit 613.6 609.8 651.8 616.0 589.6 633.4 +7.4% Other operating inc
Slide 59: Royalties and milestones
Royalties and milestones Includes significant part of EUR 50 million 80 darolutamide collaboration signing fee from Bayer Includes EUR 45 million milestone from Bayer for the first commercial sales of darolutamide in the USA 70 60 5 EUR million 50 39 40 12 51 30 15 53 8 20 5 28 30 10 23 23 17 11 0 2
Slide 60: Development of Proprietary Products net sales
Development of Proprietary Products net sales 450 400 24 Other 26 67 350 44 56 18 46 26 25 Simdax® 27 20 59 300 13 29 47 56 57 68 EUR million 48 25 51 250 35 Easyhaler® 59 51 64 77 90 35 105 200 Dexdor® 30 45 57 150 18 64 63 249 20 57 206 25 26 Precedex® 100 170 138 124 50 104 100 98 Stalevo®/Comtes
Slide 61: Financial position
Financial position EUR million 12/19 12/18 Change % EUR million 12/19 12/18 Change % Non-current assets total 435.6 418.5 +1.2% Inventories 230.3 222.1 +3.7% Equity total 779.4 773.1 +0.8% Interest-bearing non-current Trade receivables 196.5 188.8 +4.1% liabilities 6.7 0.6 Other receivables 24.3 33.
Slide 62: Development of capital expenditure
Development of capital expenditure Orion Capex, EUR million 90 80 70 60 50 Property, plant and equipment 40 30 Intangible assets 20 Depreciation, amortisation and 10 impairment 0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Investor Presentation © Orion Corporation 62
Slide 63: Development of net working capital
Development of net working capital % of net sales EUR million 40% 400 30% 300 20% 200 10% 100 0% 0 -10% -100 -20% -200 -30% -300 2012 2013 2014 2015 2016 2017 2018 2019 2012 2013 2014 2015 2016 2017 2018 2019 Receivables Receivables Inventories Inventories Short-term non-interest bearing liabilities
Slide 64: Dividend distribution policy and dividend history
Dividend distribution policy and dividend history • Orion’s dividend distribution takes into account distributable funds and capital expenditure and other financial requirements in medium and long term to achieve the financial objectives. EUR Dividend distribution history 1,75 0.20 110% 0.12 105% 1,
Slide 65: Easyhaler® - diverse treatment options for asthma and COPD
Easyhaler® - diverse treatment options for asthma and COPD by utilizing the same inhaler technology ● Easyhaler® is a dry-powder inhaler developed in- house ● Orion has developed Easyhaler®-adapted dry powder formulations of several well-known generic active substances: – salbutamol, beclometasone,
Slide 66: Orion calendar
Orion calendar Annual General Meeting 25/3/2020 Interim Report 1−3/2020 28/4/2020 Half-Year Report 1−6/2020 17/7/2020 Interim Report 1−9/2020 21/10/2020
Slide 67: Investor Relations
Investor Relations Jari Karlson CFO jari.karlson@orion.fi +358 10 426 2883 Tuukka Hirvonen Head of Investor Relations tuukka.Hirvonen@orion.fi +358 10 426 2721 Heidi Ahti Executive Assistant (Investor meeting requests) heidi.ahti@orion.fi +358 10 426 2169 www.orion.fi/EN/Investors twitter.com/OrionC