Slide 1: Orion Investor Presentation
Orion Investor Presentation Updated on 28 July 2015
Slide 2: Forward-looking statements
Forward-looking statements 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 anticipa
Slide 3: Contents
Contents 4 Orion in brief 14 Strategy and financial objectives 20 Orion R&D – long term opportunities 51 Business units 61 Key financials 68 Q1-Q2 highlights 3 Investor Presentation (updated on 28 July 2015)
Slide 4: Orion in brief
Orion in brief —=———=— RION Building well-being
Slide 5: Orion today – building well-being since 1917
Orion today – building well-being since 1917 Animal Health Specialty Products (Gx + OTC) Net sales ~mEUR 1,000 Fermion Personnel ~3,500 (API production) R&D expenses ~11% of net sales Contract Six production sites in Manufacturing Finland Sales organisation in >20 European Orion Proprietary countrie
Slide 6: Solid growth and good profitability
Solid growth and good profitability 1200 32% Geographical sales split in 2014 1000 30% 13% EUR million 800 28% 29% 600 26% 10% 400 24% 200 22% 0 20% 2007 2008 2009 2010 2011 2012 2013 2014 13% 35% Net sales Operating profit Finland Scandinavia Operating profit, % of net sales Other Europe North Amer
Slide 7: Sales split in 2014 and development vs. 2013
Sales split in 2014 and development vs. 2013 Proprietary Fermion EUR 57 Products million EUR 373 million (-10%) (-4%) Specialty Contract Products Manufacturing EUR 427 million EUR 34 million (+11%) (-21%) Animal Health Orion EUR 70 million Diagnostica EUR (-1%) 56 million (-1%) 7 Investor Presentati
Slide 8: Product mix is changing for the time being
Product mix is changing for the time being Sales split by business Sales split by business 2011 2014 3% 3% 5% 5% 6% 5% 7% 7% 37% 45% 1 0 Cate gor y 1 35% Cate gor y 2 Cate gor y 3 42% Cate gor y 4 Proprietary Products Specialty Products (generics+OTC) Animal Health Fermion Contract Manufacturing & o
Slide 9: Best-selling pharmaceuticals 2014
Best-selling pharmaceuticals 2014 Net sales, EUR million 2013 1. Stalevo®, Comtess® & Comtan® (Parkinson’s disease) -18% 169 207 2. Simdax® (acute decompensated heart failure) +2% 47 46 3. Easyhaler® product family (asthma, COPD) +22% 35 29 4. dexdor® (intensive care sedative) +39% 35 25 5. Precedex
Slide 10: Balancing mid-term − building long-term
Balancing mid-term − building long-term Long-term growth opportunities from R&D pipeline. Milestone payments. Generic competition for Parkinson’s Generic drugs and self-care products. franchise and Precedex. Easyhaler® combinations and Timing of milestone payments. dexdor® for European markets. Glob
Slide 11: Two share classes, broad shareholder base
Two share classes, broad shareholder base By number of shares on 30 Jun By number of votes on 30 Jun 5% 1% 8% 0% 5% 8% 7% 41% 13% 62% 9% 41% Households Households Non-Finnish holders and nominee registered Non-Finnish holders and nominee registered Private corporations Private corporations Public se
Slide 12: Orion B share performance
Orion B share performance 3 July 2006─30 Jun 2015 Index 3 July 2006 = 100 350 300 250 MSCI Europe Pharmaceuticals 200 OMX Helsinki Cap Orion B 150 Orion B total return 100 50 12 Investor Presentation (updated on 28 July 2015)
Slide 13: From conglomerate to pharmaceuticals and diagnostics company
From conglomerate to pharmaceuticals and diagnostics company Orion listed to Helsinki Stock Exchange Orion in 1990 (sales FIM million) Demerger into 131 98 Orion Oyj and Normet divested Oriola-KD Oyj 217 535 1663 1993 1995 1999 2003 2006 824 Chymos divested Noiro divested Pharmaceuticals Oriola (who
Slide 14: Orion’s strategy and financial objectives
Orion’s strategy and financial objectives
Slide 15: Orion’s strategy – Mission to build well-being
Orion’s strategy – Mission to build well-being Megatrends Strategic targets Focus areas Strategic development projects 15 Investor Presentation (updated on 28 July 2015)
Slide 16: Orion’s financial objectives
Orion’s financial objectives Increasing net sales. æ Achievement of this objective requires continuous investment in development of the product portfolio. > Maintaining profitability at a good level. The aim is operating profit that exceeds 20% of net sales. ≥ Keeping the equity ratio at least 50%.
Slide 17: Orion’s financial objectives
Orion’s financial objectives Operating profit Net sales 300 35% 1,200 12% 250 30% 1,000 10% Operating 800 8% 200 25% profit, EUR 600 6% million 4% Net sales, EUR 150 20% 400 2% million Operating 200 0% 100 15% - -2% Growth, % profit, % of net 50 10% sales 0 5% Operating profit target >20% Dividend E
Slide 18: Dividend distribution policy
Dividend distribution policy 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. Dividend distribution history EUR 1.60 100% 0.12 EUR 1.40 0.06 95% EUR 1.20 0.10 90%
Slide 19: Outlook for 2015
Outlook for 2015 (updated on 9 July 2015) Net sales are estimated to be at similar level to 2014 Net sales (net sales were EUR 1,015 million in 2014). Operating profit Operating profit is estimated to exceed EUR 260 million. The Group’s capital expenditure will be about EUR 50 Group’s capital millio
Slide 20: Orion R&D – long term opportunities
Orion R&D – long term opportunities
Slide 21: Orion’s R&D strategy
Orion’s R&D strategy Focus on three core therapy areas + generics Focused therapy • Central nervous system diseases areas • Oncology and critical care • Easyhaler pulmonary drugs Emphasis on collaboration and partnerships • Clinical studies are performed globally, Orion’s focus on Europe Shared risk
Slide 22: Collaborative networks across the R&D value chain
Collaborative networks across the R&D value chain Late stage Research Early development development Candidate Target Hit to Lead Lead selection, identification Phase I Phase II Phase III generation optimisation preclinical and validation development Early stage partnering Late stage partnering KEY C
Slide 23: Key clinical pharmaceutical development projects 1/2
Key clinical pharmaceutical development projects 1/2 Project Indication PHASE Registration Bufomix Easyhaler® (budesonide-formoterol) 1) Asthma, COPD I II III Easyhaler® salmeterol-fluticasone Asthma, COPD I II III ODM-201 (androgen receptor inhibitor) 2) Prostate cancer I II III Low Cardiac Output
Slide 24: Key clinical pharmaceutical development projects 2/2
Key clinical pharmaceutical development projects 2/2 Project Indication PHASE Registration ODM-104 (more effective COMT inhibitor) Parkinson’s disease I ODM-203 (targeted FGFR+VEGFR inhibitor) Solid tumours I ODM-204 (CYP17 enzyme and androgen receptor inhibitor) Prostate cancer I ODM-106 (GABA-B re
Slide 25: ODM-201
A novel second generation ODM-201 androgen receptor (AR) inhibitor for the treatment of castration resistant prostate cancer In collaboration with Bayer
Slide 26: ODM-201: Partnership with Bayer – Financial terms
ODM-201: Partnership with Bayer – Financial terms • Orion and Bayer will jointly develop ODM-201, with Bayer contributing a major share of the costs of future development • Bayer will commercialize ODM-201 globally and Orion has the option to co-promote ODM-201 in Europe • Orion is eligible to recei
Slide 27: ODM-201 has a unique profile
ODM-201 has a unique profile Enzalutamide 19%* ODM-201 3% ** ARN-509 29%* Enzalutamide ARN-509 ODM-201 general structure AR Antagonism IC50 (nM) Proliferation Compound affinity AR AR AR VCaP Ki (nM) WT AR IC50 (nM) (F876L) (T877A) (W741L) Bicalutamide 12 150 218 957 Agonist Enzalutamide 86 155 Agoni
Slide 28: ODM-201 Phase III study ongoing in nmCRPC
ODM-201 Phase III study ongoing in non-metastatic castration resistant prostate cancer (nmCRPC) ODM-201 (androgen receptor inhibitor) 2) Prostate cancer I II III • nmCRPC patients who are at high risk for developing metastatic disease are included (n=1500) • Primary endpoint – ODM-201 over placebo i
Slide 29: ODM-203
A unique and selective dual ODM-203 FGFR+VEGFR inhibitor for FGFR-dependent tumors
Slide 30: Angiogenic indications with altered FGFR signalling
Angiogenic indications with altered FGFR signalling Tumor type Genomic alterations of FGFRs and FGFs Breast (luminal) ~35% (FGFR1 amp, FGFR2 amp, FGFR4 amp, FGFs) NSCLC-SCC ~20% (FGFR1 amp, FGFR2 amp) Bladder (invasive) ~15% (FGFR3 fusions, FGFR1 amp, FGFs) Prostate ~14% (FGFR1 amp, FGFR2&3 fusions)
Slide 31: ODM-203 has strong in vivo antitumor activity
ODM-203 has strong in vivo antitumor activity FGFR xenograft model (RT4) Angiogenic kidney cancer model (Renca) 600 500 400 300 200 100 0 0 2 4 6 8 10 12 14 16 18 20 Treatment day Vehicle control p.o. Selective FGFRi (12.5 mg/kg) ODM -203 (20 mg/kg) ODM -203 (40 mg/kg) • Superior activity in angioge
Slide 32: ODM-204
Target: ODM-204 Best-in-class treatment for metastatic Castration Resistant Prostate Cancer (mCRPC)
Slide 33: Positioning of ODM-204
Positioning of ODM-204 CRPC AR F876L Post Xtandi / Zytiga AR-V7 Non- Pre-Chemo Post-Chemo metastatic Metastatic Metastatic Metastatic Zytiga Zytiga Xtandi Xtandi ODM-201 ODM-204 Note: Zytiga/Xtandi combination trials are ongoing 33 Investor Presentation (updated on 28 July 2015) http://www.orion.fi/
Slide 34: ODM-204 – current status
ODM-204 – current status ODM-204 (CYP17 enzyme and androgen receptor inhibitor) Prostate cancer I • Phase I/II DUALIDES trial ongoing – Safety and Pharmacokinetics of ODM-204 in Patients With Metastatic Castration-Resistant Prostate Cancer (DUALIDES) – Subgroups: Number of CYP17A1i Second-generation
Slide 35: ORM-12741 for Alzheimer’s disease
ORM-12741 for Alzheimer’s disease In collaboration with Janssen
Slide 36: ORM-12741 – collaboration with Janssen
ORM-12741 – collaboration with Janssen • Licence agreement announced on 19 December 2013 (includes ORM-12741 and other compounds) • Orion received USD 31 million upfront payment which will mainly be used against additional Phase IIa study costs • Orion is eligible to receive milestone payments from
Slide 37: ORM-12741 Phase 2a results
ORM-12741 • Highly potent and selective alpha- 2C adrenoceptor antagonist • Rodent models predict beneficial effects on cognition and neuropsychiatric symptoms (NPS) • Phase 1 studies (healthy subjects) – Possible to administer orally Quality of Memory – Well tolerated – Displacement of an alpha-2C
Slide 38: Phase 2 study on efficacy of ORM-12741 in AD
Phase 2 study on efficacy of ORM-12741 in AD ORM-12741 (alpha-2c adrenoceptor antagonist) Alzheimer’s disease I IIa Improved formulation for the current Phase 2 study • New formulation improving pharmacokinetic (PK) properties of ORM-12741 has been developed • Phase 1 PK studies conducted to confirm
Slide 39: ODM-104
ODM-104
Slide 40: New COMT-inhibitor ODM-104 for Parkinson’s disease treatment
New COMT-inhibitor ODM-104 for Parkinson’s disease treatment ODM-104 (more effective COMT inhibitor) Parkinson’s disease I • In phase I*, ODM-104 has been in well tolerated and superior to entacapone by improving COMT inhibition and levodopa pharmacokinetics in man • Optimized carbidopa component fu
Slide 41: ODM-106
Target: First/Best-in-class ODM-106 GABA B PAM molecule for the treatment of Essential tremor
Slide 42: ODM-106 shows efficacy and safety in Essential tremor
ODM-106 shows efficacy and safety in Essential tremor ODM-106 (GABA-B receptor positive allosteric modulator) Essential tremor I • Alleviates tremor in essential tremor animal model (harmaline –induced tremor) Tremor • No signs of development of tolerance after repeated doses • No sedative or other
Slide 43: ODM-108
Target: ODM-108 Best-in-class TRPA1 antagonist molecule for the treatment of Neuropathic pain
Slide 44: ODM-108 shows efficacy and safety in Neuropathic pain
ODM-108 shows efficacy and safety in Neuropathic pain ODM-108 (negative allosteric modulator of TRPA1 ion channel) Neuropathic pain I • ODM-108 blocks pain in several No pain animal models of pain (STZ in figure, SNI, CFA) • No CNS side-effects seen in preclinical models • Well tolerated in the prec
Slide 45: ODM-109
Target: ODM-109 Best symptomatic treatment for Amyotrophic Lateral Sclerosis (ALS)
Slide 46: LEVALS study - levosimendan in ALS patients
LEVALS study - levosimendan in ALS patients ODM-109 (oral levosimendan) ALS I II • The first phase II study aims to demonstrate beneficial effects on respiratory function • Double-blind, cross-over design with 3 treatment periods • Cross-over part of the study is followed by an open-label part for 6
Slide 47: Levosimendan for Low Cardiac Output Syndrome
Levosimendan for Low Cardiac Output Syndrome Partner Tenax Therapeutics
Slide 48: Levosimendan development in US by Tenax Therapeutics
Levosimendan development in US by Tenax Therapeutics Low Cardiac Output Levosimendan Syndrome I II III Development of levosimendan Possibility to include sepsis for Low Cardiac Output shock as an additional Syndrome (LCOS) indication? • Phase 3 LEVO-CTS trial to • Collaboration with Imperial evaluat
Slide 49: Dexmedetomidine for treatment of pain
Dexmedetomidine for treatment of pain Partner Recro Pharma
Slide 50: Dexmedetomidine development for acute post-operative pain by Recro Pharma
Dexmedetomidine development for acute post- operative pain by Recro Pharma Dexmedetomidine (intranasal) Treatment of pain I IIb • Phase II trial to study the effect and safety of intranasal formulation of dexmedetomidine in adult patients undergoing bunionectomy surgery in US • Possibility to avoid
Slide 51: Business units
Business units —=———=— RION Building well-being
Slide 52: Proprietary products
Proprietary products • Mainly Orion in-house developed Sales, EUR million prescription drugs with valid 450 product protect 400 Other • Global partner network in sales 350 and R&D Stalevo 300 Current main drivers Comtan/Comtess Generic competition for Stalevo, 250 Precedex Comtan/Comtess & Precede
Slide 53: Easyhaler® for asthma and COPD
Easyhaler® for asthma and COPD Easyhaler products = Orion invented inhaler + generic APIs 1994 Beclomet 2002 Budesonide 1993 Buventol Easyhaler® 40 60% Easyhaler® Easyhaler® (budesonide) (salbutamol) (beclomethasone) 35 30 40% EUR million 25 20 20% 15 10 0% 2014 Bufomix 2010à 2004 Formoterol Easyhal
Slide 54: dexdor® intensive care sedative
dexdor® intensive care sedative European sedative market MAT3/2015* Dexdor sales Total market value EUR 509 million (+3%) 12 13% 10 6% 8 15% 6 66% 4 2 0 Propofol EUR 338 million (+1%) Midazolam EUR 76 million (-3%) Dexmedetomidine EUR 30 million (+37%) Remifentanil EUR 64 million (+9%) Dexdor sales,
Slide 55: Product protection situation of key products
Product protection situation of key products Key patents or data protection expire Molecule Product Indication Europe USA Japan Stalevo®, November 2012 January Entacapone Parkinson’s disease October 2013 Comtess® and Comtan® October 2013 1) 2015 2) Acute Levosimendan Simdax® decompensated September
Slide 56: Steady sales growth for Specialty Products
Steady sales growth for Specialty Products Orion Specialty Products = Gx + OTC including also non-medicinal products Geographical sales split in 2014 – 450 18% Finland, Scandinavia & EE key 400 16% markets 350 14% 300 12% EUR million 6% 9% 250 10% 200 8% 13% 150 6% 60% 100 4% 12% 50 2% 0 0% Finland
Slide 57: Orion Pharma Animal Health
Orion Pharma Animal Health 90 10% 75 8% EUR million 60 6% 45 4% 30 2% 15 0% 0 -2% 2010 2011 2012 2013 2014 Net sales Growth, % Product portfolio • Medicinal and non-medicinal products for companion animals and livestock Orion Pharma Animal Health direct sales • In-house developed proprietary product
Slide 58: Fermion has strategic importance
Fermion has strategic importance 70 40% 60 Fermion develops, manufactures and sells 30% active pharmaceutical ingredients (APIs) 50 EUR million 20% 40 Business segments: 10% 30 • NCEs for Orion’s existing and new proprietary 20 0% products 10 -10% • Generics to Orion and other pharmaceutical compani
Slide 59: Contract manufacturing & other
Contract manufacturing & other 50 40% • Pharmaceutical 45 manufacturing for other 30% 40 pharma companies 35 20% • Supply to global markets EUR million 30 10% 25 • Orion has special know-how 0% 20 ie. in hormonal semi-solids 15 -10% and solutions 10 -20% 5 0 -30% Read more 2010 2011 2012 2013 2014 h
Slide 60: Orion Diagnostica
Orion Diagnostica • Diagnostic test systems for 60 10% point-of-care testing in 50 8% healthcare and hygiene testing for industry 40 6% EUR million • Main market areas: Europe 30 4% (especially northern), China, USA, Japan 20 2% • Own sales units in 9 European 10 0% countries, distributor network 0
Slide 61: Key financials
Key financials —=———=— RION Building well-being
Slide 62: Key figures by quarter
Key figures by quarter EUR million Net sales EUR million Operating profit 1,200 300 1,000 250 60 59 55 66 254 273 255 800 236 Q4 200 Q4 65 76 64 67 600 246 237 238 Q3 150 Q3 211 Q2 65 74 Q2 65 61 86 400 277 255 100 227 233 248 Q1 Q1 200 50 93 83 79 74 67 244 247 249 245 260 0 0 11 12 13 14 15 11 12
Slide 63: Key figures for 2011─Q2/2015
Key figures for 2011─Q2/2015 Orion’s key figures 2011 2012 2013 2014 Q1-Q2/2015 Q1-Q2/2014 Change % Net sales, EUR million 917.9 980.4 1,006.9 1,015.3 514.9 521.7 -1.3% Operating profit, EUR million 282.9 278.3 267.7 272.4 157.1 153.4 +2.4% Profit before taxes, EUR million 282.0 276.6 264.0 267.8 15
Slide 64: Income Statement 2011─Q2/2015
Income Statement 2011─Q2/2015 Formation of profits, EUR million 2011 2012 2013 2014 Q1-Q2/2015 Q1-Q2/2014 Change % Net sales 917.9 980.4 1,006.9 1,015.3 514.9 521.7 -1.3% Cost of goods sold -305.1 -350.8 -393.5 -401.7 -185.9 -195.3 -4.8% Gross profit 612.8 629.6 613.4 613.6 329.0 326.4 +0.8% Other o
Slide 65: Capex normalising after investment program
Capex normalising after investment program EUR million Orion Capex 100 80 60 40 20 0 2007 2008 2009 2010 2011 2012 2013 2014 2015* Intangible assets *) Estimate for 2015 Property, plant and equipment Depreciation, amortisation and impairment 65 Investor Presentation (updated on 28 July 2015)
Slide 66: Financial position
Financial position EUR million 6/15 6/14 Change% EUR million 6/15 6/14 Change% Non-current assets total 350.5 360.5 -2.8% Inventories 199.4 196.2 +1.6% Equity total 461.0 464.1 -0.7% Interest-bearing non- Trade receivables 178.8 175.1 +2.1% current liabilities 204.3 227.4 -10.1% Non-current liabilit
Slide 67: Development of Net working capital
Development of Net working capital % of net sales EUR million 40% 300 250 30% 200 150 20% 100 10% 50 0 0% -50 -100 -10% -150 -20% -200 Dec09 Sep10 Jun11 Mar12 Dec12 Sep13 Jun14 Mar15 Dec09 Sep10 Jun11 Mar12 Dec12 Sep13 Jun14 Mar15 Receivables Inventories Short-term non-interest bearing liabilities N
Slide 68: Q1-Q2/2015 Highlights
Q1-Q2/2015 Highlights
Slide 69: Year continued strongly
Year continued strongly • Net sales nearly the same level as in comparative period and operating profit slightly higher • Specialty Products net sales up 10% • Early-phase research portfolio developed well • European Commission granted marketing authorisation for Orion’s Animal Health division’s new
Slide 70: Key figures
Key figures Net sales, Basic earnings per Laimentamaton Cash flow perrahavirta Osakekohtainen share Operating profit, EUR million EUR million osakekohtainen tulos, € share, EUR before financial ennen items, rahoituseriä, € EUR 522 515 153 157 0.86 0.88 0.93 0.67 Q1-Q2/2014 Q1-Q2/2015 Q1-Q2/2014 Q1-Q
Slide 71: Breakdown of mEUR 515 net sales in Q1─Q2/2015
Breakdown of mEUR 515 net sales in Q1─Q2/2015 Key figures by business divisions Q1-Q2/ 2015 Q1-Q2/2014 Change % Net sales of Pharmaceuticals, EUR million 486 494 -1.6% Proprietary Products 172 204 -15.8% Specialty Products 223 204 +9.7% Animal Health 44 32 +36.5% Fermion 29 35 -17.6% Contract manufa
Slide 72: Breakdown of mEUR 515 net sales in Q1─Q2/2015
Breakdown of mEUR 515 net sales in Q1─Q2/2015 By business division By market area 6% 4% 15% 6% 33 % 30% 8% 8% 43% 15% 32% Proprietary Products Specialty Products Animal Health Finland Scandinavia Fermion Other Europe North America Contract manufacturing & other Orion Diagnostica Other countries 72 I
Slide 73: Best-selling pharmaceuticals Q1─Q2/2015
Best-selling pharmaceuticals Q1─Q2/2015 2014 Net sales, EUR million Stalevo®, Comtess® & Comtan® (Parkinson’s disease) -18% -13% 80 169 Simdax® (acute decompensated heart failure) +2% +14% 26 47 Easyhaler® product family (asthma, COPD) +22% +53% 25 35 dexdor® (intensive care sedative) +39% +33% 22 3
Slide 74: Orion Investor Relations
Jari Karlson CFO jari.karlson@orion.fi +358 10 426 2883 Orion Investor Tuukka Hirvonen Communications Manager Relations Financial Communications & Investor Relations tuukka.hirvonen@orion.fi +358 10 426 2721 Heidi Ahti Executive Assistant (Investor meeting requests) heidi.ahti@orion.fi +358 10 426 2