Novo Nordisk A/S 1 A focused healthcare company Sal. Oppenheim - Investor presentation – March 2003.
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1
Novo Nordisk A/S
A focused healthcare companySal. Oppenheim - Investor presentation – March 2003
2
Forward-looking statements
This presentation contains forward-looking statements as the term is defined in the US Private Securities Litigation Reform Act of 1995.
Such forward-looking statements are subject to risks, uncertainties and inaccurate assumptions. This may cause actual results to differ materially from expectations. Factors that may affect future results include interest rate and currency exchange rate fluctuations, delay or failure of development projects, production problems, unexpected contract breaches or terminations, government-mandated or market-driven price decreases for Novo Nordisk's products, introduction of competing products, Novo Nordisk's ability to successfully market both new and existing products, exposure to product liability and other lawsuits, changes in reimbursement rules and governmental laws and related interpretation thereof, unexpected growth in costs and expenses.
Risks and uncertainties are further described in reports filed by Novo Nordisk with the US Securities and Exchange Commission (SEC) including the company's Form 20-F, which was filed on 26 April 2002. Novo Nordisk is under no duty to update any of the forward-looking statements after the date of this report or to conform such statements to actual results, unless required by law.
Novo Nordisk has the copyright to the information contained in this presentation. © 2003 Novo Nordisk A/S.
3
Agenda
• Introduction
• Diabetes care• Insulin therapy • Novo Nordisk’s diabetes commitment outside insulin
• Biopharmaceuticals
4
Diabetes – an unfolding epidemic
370 million people with diabetes expected by 2030
Source: WHO, January 2003
# of
peo
ple
with
dia
bete
s (m
illio
n)
0
50
100
150
200
250
300
US Japan Europe Rest ofWorld
2000
2030
5
Diabetes care - Treatment matters
Only a small number of Only a small number of patients are in controlpatients are in control
Intensive treatment mattersIntensive treatment matters
Dis
trib
uti
on
of
Dis
trib
uti
on
of
pat
ien
tsp
atie
nts
HbA1cHbA1c
* Measured according to Guidelines for Diabetes Care, IDF Europe
** According to epidemiological analysis of the UKPDS data, 1998
HbA1c lowering by one HbA1c lowering by one percentage point reduces percentage point reduces
micro vascular risk by 35%**micro vascular risk by 35%**
Close to 80% are exposed to
arterial or microvascular risk*
6
6.0% to 6.0% to <7.0%<7.0%
7.0% to 7.0% to <8.0%<8.0%
8.0% to 8.0% to <9.0%<9.0%
9.0% to 9.0% to <10.0%<10.0%
>10%>10%
1.4x1.4x
1.8x1.8x2.1x2.1x
2.9x2.9x
3.5x3.5xRisk of any complication relative to HbA1c below 6.0%Risk of any complication relative to HbA1c below 6.0%
Poor control leads to higher risk
Source: Adapted from UKPDS 35
7
Late stage complications represent a huge burden
Relative cost of diabetes complications* Relative cost of diabetes complications*
Macro Macro vascularvascular
Micro Micro vascularvascular
No compli- No compli- cationcation
BothBoth
1.7x1.7x2.0x2.0x
3.5x3.5x
* Cost for sociaty relative to no complication. Source: Adapted from Rhys Williams, IDF
** ADA, Diabetes Care, March 2003
Diabetes cost the US an estimated $132 billion in 2002 in medical expen-diture and lost produc-tivity**
Health care expendi-tures incurred by people with diabetes comprises 19% of total health care expenditure in the US**
8
Pharmaceutical needs in diabetes
Type 1 diabetes• Intervention in -cell destruction • Blood glucose regulation*
Type 2 diabetes• Blood glucose regulation*
• Regulation of energy balance (diabetes-associated obesity)
• Reduction of triglycerides, FFA and LDL/HDL ratio (diabetic dyslipidaemia)
* Including, but not restricted to, new pharmaceuticals
9
Novo Nordisk to leverage on growth
• Building on 80 years of experience within diabetes
• Dominant position in the European and Japanese insulin markets – solid growth in the US. Moreover, market leader in International Operations
• Around 2,500 R&D employees dedicated to diabetes, representing approximately ¾ of R&D resources
• Most complete portfolio of new insulins
• Leadership in insulin delivery systems – one new device per year
• Most comprehensive diabetes pipeline in the industry
10
The three core competences
Diabetes expertise Protein expertise Drug delivery expertise
• Protein formulation
• Device technology
• Protein discovery
• Genetic engineering
• Protein engineering, production andcharacterisation
• Protein technology IPR
• Biochemistry
• Pharmacology
• Clinical development
• External networks
• Understanding of patient needs
11
R&D strategy - based on core competences
Diabetes expertise
Protein expertise
NovoSeven® expansion
NN2211
balaglitazone
NN2501
AERx® iDMS
insulin analogues
NN414
hGH expansion
ASIS
Drug delivery expertise
Protein Delivery System unit
(PDS)
12
Diabetes R&D at Novo Nordisk - sources of innovation
Clinical research
• Steno Diabetes Centre
• Oxford Diabetes Centre
• Clinical research centres worldwideEvidence-based medicine
• NN disease mgt programmes
• Outcomes data from > 100.000 individuals with diabetes
Molecular diversity & design
• Protein chemistry since ’23
• Medicinal chemistry since ’68
• Computational chemistry since ’75
• Rational drug design since ’83
• Combinatorial chemistry since ’93
Trinomics
• Genomics: Incyte since ’95
• Proteomics: CPA since ’97
• Metabonomics since ’99
Drug target & screening
• Molecular biology since ’80
• HT screening: Amersham since ’92
• Chemoinformatics since ’95
• Dundee MRC consortium since ’98
• Ultra HT Screening since ’00
Basic research
• Hagedorn Research Institute
• Oxford and Steno Diabetes Centre
• Academic collaborations
• Consortia
R&D projects
13
The miracle of insulin
Patient J.L., December 15, 1922
February 15, 1923
14
Insulin - the ultimate treatment
-C
ell f
unc
tion
Diet and exercise alone
Oral therapy(66%)
Insulin therapy(27%)
Oral/insulin(7%)
Time from diagnosis
Type 2 - slope
Type 1 - Immediate need for insulin
15
Novo Nordisk leadership in insulin therapy
Innovation within insulin therapy will continue to drive the insulin market by providing more efficacious, reproducible and convenient treatment modalities
Novo Nordisk will expand its leadership by maintaining the world’s richest insulin portfolio including new insulin analogues, new insulin
formulations and new insulin delivery systems
16
Novo Nordisk Eli Lilly Aventis
Short-acting Marketed Marketed Phase 3
Long- acting Filed ? Marketed
Premix Marketed Marketed
Novo Nordisk to be the first company with a full range of insulin analogues
Novo Nordisk leadership in insulin therapy
17
p < 0.05
-10%
p < 0.001
-17%
NovoMix® 30 - the premix analogue of choice
Hermansen K et al. Diabetes Care 2002;25:883-888.
12
13
14
15
16
17
18
19
20
21
Humalog® Mix 25 NovoMix® 30 BHI 30
Ser
um
glu
cose
exc
urs
ion
0-5h (
mm
ol/l
h)
18
Profile of the ideal basal insulin
Desirable properties:Solubility
• Soluble at neutral pH• Mixable with other insulins
Absorption• Predictable
Glucose lowering effect• Peakless with low variability
Safety profile• Low risk of hypoglycaemia at
all times
Injection site• No local reactions
Limitations of current insulins:Solubility
• Most current basal insulins require re-suspension
Absorption• Highly variable
Glucose lowering effect• Not predictable
Safety profile• Risk of hypoglycaemia
Injection site• Injection pain with acidic
insulin
19
Devices important to Novo Nordisk
• facilitate intensification & initiation
total insulin market
market share
profitability
• differentiation• clear competitive
advantage
• leverage price premiums
• more profitable than vials
Part of NN VisionLeadership, commitment, care, control
20
Modern insulin pens and dosers
Control ComplianceSimple & Convenient
21
AERx® iDMS- Pulmonary insulin administration
• Pulmonary insulin opportunity• Non-invasive insulin delivery• Mainly poorly controlled Type 2 diabetes patients• Expanded insulin sales
• Product requirements• Accuracy, precision, dose adjustment• Patient friendly device interface• Scaleable manufacturing
• Aradigm is the ideal partner• Liquid insulin formulation • Breath control• Increment of single insulin units• Performance monitoring
22
Novo Nordisk’s diabetes commitment outside insulin
Time horizon
Val
ue
+ Insulin detemir and future devices
Intensified - NovoRapid®
+ AERx® iDMS (NN1998)
+ NN2211
+ Balaglitazone (NN2344)
+ New superior OADs(eg NN414; NN2501)
+ New proteins and concepts
+ FlexPen®
Convenience - NovoMix®
• Development of balaglitazone (NN2344) continues
• Benefit/risk assessment supports further development
• NN414 has concluded phase 1
• NN2501 (glucagon antagonist) has entered phase 1
• Phase 2 data on NN2211 in H1 2003
23
Type 2 diabetes – the metabolic syndrome
NovoNormNovoNormTMTM//PrandinPrandin®®
NovoNormNovoNormTMTM/Prandin/Prandin®®
NN304NN304
NN1998NN1998
NN2344NN2344
Glucose-induced Glucose-induced insulin secretioninsulin secretion
Tissue response Tissue response to insulinto insulin
Hepatic Hepatic glucose glucose productionproduction
Glucose Glucose uptakeuptake
ImpairedImpairedbeta cellbeta cellfunctionfunction
Basal hyper- Basal hyper- insulinemiainsulinemia
Post Post receptor receptor defectdefect
GlucoseGlucosetransporttransport
Insulin Insulin bindingbinding
NN414NN414
Genetic
Acquired
Obesity
Age
Genetic
Acquired
Obesity
Age
InsulinInsulindeficiencydeficiency
NovoRapidNovoRapid
InsulinInsulinresistanceresistance
HyperglycemiaHyperglycemia
NN2211NN2211
NN2211NN2211
Genetic
Acquired Glucotoxicity Lipotoxicity
Genetic
Acquired Glucotoxicity Lipotoxicity
NN344NN344
NovoMixNovoMixNN2501NN2501
24
NN2211- to report phase 2 data in H1 2003
The first once-daily human GLP-1 analogue
• Glucose dependent insulin secretion
• Glucose dependent glucagon inhibition
• Appetite suppression
• Possible beta cell rescue 00
22
44
66
88
1010
1212
1414
44 66 88 1010 1212Glucose (mmol/L)Glucose (mmol/L)
Insu
lin S
ecr
etio
n R
ate
Insu
lin S
ecr
etio
n R
ate
PlaceboPlaceboNN2211
Healthy ControlsHealthy Controls
NN2211 normalises beta cell sensitivity to glucose in type 2 diabetes
25
Diabetes care pipeline
Compound Type Indication Phase
Insulin detemir (NN304) Insulin Type 1+2 diabetes Filed EU+US
NovoMix® 50 and 70 Insulin Type 1+2 diabetes Phase 3
AERx® iDMS (NN1998) Insulin Type 1+2 diabetes Phase 3
Balaglitazone (NN2344) OAD Type 2 diabetes Phase 2
NN2211 GLP-1 analogue Type 2 diabetes Phase 2
NN414 OAD Type 1+2 diabetes Phase 1
NN344 Insulin Type 1+2 diabetes Phase 1
NN2501 OAD Type 2 diabetes Phase 1
26
Biopharmaceuticals - outside diabetes care
• Phase 2 with ASIS* in acute respiratory distress syndrome (ARDS) initiated
• Growth hormone expansion programme
• EU approval is expected in first half of 2003 for SGA/IUGR**
• Phase 2 in complicated fractures initiated
Life-cycle management
Time horizon
Val
ue
Norditropin® SimpleXx® - growth disorders
NovoSeven® - haemophilia
+ hGH - SGA/IUGR
+ New indications
+ New formulations
+ New devices
+ New areas
+ NovoSeven® expansion
+ ASIS
+ hGH - complicated fractures
* Active Site Inhibited Seven** Small for Gestational Age / Intra Uterine Growth Retardation
27
Biopharmaceuticals - pipeline outside diabetes care
Compound Indication Phase
Growth hormone IUGR/SGA Filed in EU
Growth hormone Complicated fractures Phase 2
NovoSeven® Hepatectomy Phase 2
NovoSeven® Liver transplantation Phase 2
NovoSeven® Trauma Phase 2
NovoSeven® Stem cell transplantation Phase 2
NovoSeven® ICH* Phase 2
ASIS ARDS Phase 2
* Intra-cerebral haemorrhage
28
NovoSeven® - current business
Key observations
• Penetration increases as confidence in NovoSeven® increases
• Increased treatment intensity and earlier onset of treatment
• Increased confidence in elective surgery with NovoSeven®
• Awareness creation within acquired haemophilia progressesConfidence/Awareness
Pe
netration
Elective surgery within haemophilia
Acquired haemophilia
Spontaneous bleedings in congenital haemophilia
29
Beyond haemophilia treatment
HaemostasisManagement
HaemophiliaTreatment
30
NovoSeven® - the expansion programme
General haemostatic agent
Elective surgery Bleeding in emergencies
Hepatectomy
Liver transplantation
Intra-cerebral haemorrhage
Stem cell transplantation
Upper gastrointestinal
bleedings
Trauma
31
Increasing awareness - NovoSeven®
Articles and abstracts*
0
1000
2000
3000
4000
5000
6000
7000
19
82
19
84
19
86
19
88
19
90
19
92
19
94
19
96
19
98
20
00
20
02
Ac
cu
lula
ted
nu
mb
er
0
500
1000
1500
1999 2000 2001 2002
Ac
cu
mu
late
d n
um
be
r
Patients enrolled in clinical programmes
* Source: Literature search in Medline, Embase and Biosis for articles and abstracts mentioning NovoSeven®,
Niastase; Factor VIIa; fVIIa; recombinant Factor VIIa and rfVIIa
32
Pipeline reporting - development
H1 2003
H2 2003
H1 2004
Compound Indication EventGrowth hormone IUGR/SGA Approval*
NN2211 (GLP-1 analogue) Type 2 diabetes Phase 2 data
NovoSeven® Hepatectomy in cirrhotics Phase 2 data
NovoSeven® Liver transplantation Phase 2 data
NovoMix® 50 and 70 Type 1+2 diabetes Filing
NovoSeven® Trauma Phase 2 data
NovoSeven® Stem cell transplantation Phase 2 data
NovoSeven® ICH Phase 2 data
Insulin detemir Type 1+2 diabetes Approval**
Growth hormone Complicated fractures Phase 2 data
ASIS ARDS Phase 2 data
* In Europe** In Europe and US
33
Low exposure to patent expiration
Accumulated % of 2002 Novo Nordisk sales with patents
expiring
0
5
10
15
20
25
30
35
40
2003
2004
2005
2006
2007
2008
2009
2010
2011
0
5
10
15
20
25
30
35
40
Bay
er
GS
K
Tak
eda
Pfi
zer
Mer
ck
No
vart
is
BM
S
Ave
nti
s
Eli
Lil
ly
% of 2001 sales with patents expiring in 2002-2006
Source: Nordea Securities and Novo Nordisk A/S.
No
vo N
ord
isk
34
Key growth drivers
Novo Nordisk sales*
• Leadership in diabetes care
• NovoSeven® expanding into general haemostasis
• Strong IP portfolio with low exposure to patent expirations
0
5
10
15
20
25
19
89
19
91
19
93
19
95
19
97
19
99
20
01
Bil
lio
n D
KK
13Y CAGR 13+%
* Since the merger between Novo and Nordisk in 1989
35
Appendix slides
36
Highlights
Sales 2002 • +6% as reported and +11% in local currencies for the full year• +4% as reported and +11% in local currencies for the fourth quarter
Operating profit 2002• +7%; revised target for the year met• +8% for the fourth quarter
Outlook 2003• Sales up more than 5% reported or 13% in local currencies• Operating profit will grow towards 5% reported or close to 20% in local currencies• Net profit to grow towards 10%
37
North America+12%
International Operations
+21%
Europe+3%
Japan & Oceania-6%
43%
24%
17%
16%
Sales in 2002 - by therapy and region
HRT-6%
Haemostasis management
+17%
Diabetes care+6%
Growth hormone therapy
-2%
14%
5%
70%
8%
By therapy By region
Total DKK 25.2 billion +6% reported and +11% in local currencies
38
Sales by therapy
DKK million 2002 2001 % of total % change (2002)
Insulin etc 16,034 15,223 64 5
OAD* 1,631 1,401 6 16
Diabetes care, total 17,665 16,624 70 6
Haemostasis management 3,621 3,096 14 17
Growth hormone therapy 2,131 2,164 9 (2)
HRT 1,342 1,435 5 (6)
Other 428 457 2 (6)
Total 25,187 23,776 100 6
* Oral antidiabetic products (OAD) include NovoNorm®/Prandin® as well as
Glucoformin® (metformin) sales by Biobrás in full year 2002.
39
Sales by region
DKK million 2002 2001 % of total %
change (2002)
Europe 10,880 10,553 43 3
North America 5,913 5,277 24 12
Japan & Oceania 4,239 4,498 17 (6)
International Operations 4,155 3,448 16 21
Total 25,187 23,776 100 6
40
-20 -10 0 10 20 30 40
% growth in DKK % growth in local currencies
Diabetes care
Haemostasis management
HRT
Growth hormone therapy
Total
-20 -10 0 10 20 30 40
Diabetes care
Haemostasis management
Growth hormone therapy
HRT
Total
Full year Fourth quarter
116
2217
4-2
-5-6
116
125
2517
-1-8
-14-15
114
Sales by therapy - currency impact
41
-20 -10 0 10 20 30 40
Europe
North America
Japan & Oceania
International Operations
Total sales
Sales by region - currency impact
-20 -10 0 10 20 30 40
% growth in DKK % growth in local currencies
Europe
North America
Japan & Oceania
International Operations
Total sales
Full year Fourth quarter
43
1812
2-6
3421
116
-1-2
25 13
0-9
4429
114
42
5%10%
5%9%
Q1 2002
Growth compared to previous years
7%9%
6%9%
Q32002
4%8%
9%12%
8%9%
9%12%
Novo Nordisk growth:• Volume• Value
Q2 2002
Q42001
Q3 2001
Q2 2001
4%7%
9%13%
9%11%
9%14%
Total market growth:• Volume• Value
’In-market’ sales
Insulin sales in Europe - ‘in-market’ sales
Note: Data based on IMS. ‘In-market data’ reflects sale of insulin products from the wholesalers to the pharmacists.
43
European analogue conversion - NovoRapid®
Short-acting segment in Europe
Q4 1996 Q3 2002
Short-acting human insulin
Short-actinginsulin analogues
Dec 2000
NovoRapid® market share 14.6%*
Humalog market share 26.7%*
Share of short-acting segment
Nov 2002
41%
Note: Data based on IMS
44
US analogue conversion - NovoLog®
Short-acting segment in the US
Q4 1996 Q3 2002
Short-acting human insulin
Short-actinginsulin analogues
54%
Dec 2001
NovoRapid® market share 7.4%*
Share of short-acting segment
Nov 2002
Humalog market share 49.3%*
Note: Data based on IMS
45
Launch of NovoMix® 30 - still in progress
0
100
200
300
400
500
600
700
800
900
1 3 5 7 9
11
13
15
NovoMix® 30
NovoRapid®
LisproMix 25
Share of segment in Europe (volume)
Sales development in Europe (MU)
0%
2%
4%
6%
8%
10%
12%
14%
16%
1 3 5 7 9
11
13
15
NovoMix® 30
NovoRapid®
LisproMix 25
Quarters from launch Quarters from launch
Note: Data based on IMS
46
Novo Nordisk market share since Lantus launch
Total insulin(MU)
Month of Lantus launch
November 2002
USA 26% 28%
Europe 57% 57%
Germany 44% 44%
UK 67% 67%
Germany
30
35
40
45
50
Sep-01 Apr-02 Nov-02
Vo
lum
e s
ha
re
Basal
Premix
Short-acting
* Oct-02 MS in the basal impacted by hoarding of Lantus in anticipation of the Nov-02 price increase.
*
Note: Data based on IMS
47
Novo Nordisk regaining strength in Germany
30
35
40
45
Insu
lin v
olu
me
shar
e
Novo Nordisk
Aventis
* Oct-02 MS impacted by hoarding of Lantus in anticipation of the Nov-02 price increase.
*
*
Germany, volume
30
35
40
45
Insu
lin
valu
e s
hare
Novo Nordisk
Aventis
Germany, value
Sep 2001 Nov 2002 Sep 2001 Nov 2002
*
*
Note: Data based on IMS
48
Insulin segmentation - Europe and the US
20
25
30
35
40
45
50
Sep-01 Apr-02 Nov-02
Vo
lum
e s
ha
re
Europe
20
25
30
35
40
45
50
Sep-01 Apr-02 Nov-02
Vo
lum
e s
ha
re
BasalPremixShort-acting
US
Note: Data based on IMS
49
0600
Normal
Type 2 diabetes
1000 1400 1800 2200 0200 0600
800
700
600
500
400
300
200
100
Insu
lin
Sec
reti
on
(p
mo
l/m
in)
Source: O'MEARA et al. Am. J. Medicine, 1990; 89.
Insulin secretion in normal people and people with type 2 diabetes
50
-0.5
0
0.5
1
1.5
Insulin detemir (NN304)
NPH
Change in weight (Kg) over 12 months
-1.7 Kg
Source: E. Standl et al. Abstract number 467 ADA 2002
No weight gain with insulin detemir
Body weight control with insulin detemir
p = 0.002
Type 1 diabetes
NovoMix® 30 provides improved postprandial control
0
5
10
15
20
25
lispromix 25 BIAsp 30 BHI 30
-10% -17%
p < 0.05 p < 0.0001
S-g
luco
se e
xcu
rsio
n0-
5h (
mm
ol/l
h)
Source: Hermansen K et al. Diabetes Care 2002;25:883-888.
52
Advantages of NovoSeven®
A bleeding episode
FVIIa/NovoSeven®®
Tissue factor
Fas
ter
haem
osta
sis
lead
s to
•F
ew
er tr
ans
fusi
ons
/ tr
ans
fusi
on
- fr
ee
su
rger
y
•R
ed
uce
d re
ble
edi
ng
•F
ast
er
reco
very
•R
ed
uce
d m
orb
idity
and
mo
rtal
ity
•Im
pro
ved
qu
ality
of l
ife
53
Growth hormone therapy
Ke
y o
bse
rva
tion
s
•S
ales
dec
reas
ed b
y 1%
in
loca
l cur
renc
ies
in t
he f
ourt
h qu
arte
r as
a r
esul
t of
low
er
sale
s in
Jap
an
•In
Eur
ope,
Nor
th A
mer
ica
and
Inte
rnat
iona
l Ope
ratio
ns
grow
th is
driv
en b
y N
ordi
trop
in®
Sim
pleX
x®.
0
500
1000
1500
2000
2500
1998 1999 2000 2001 20021997
DKK billion
54
HRT
Ke
y o
bse
rva
tion
s
•S
ales
in lo
cal c
urre
ncie
s de
crea
sed
by 1
4% in
the
fou
rth
quar
ter
•S
ales
in E
urop
e de
crea
sed
by
24%
, re
flect
ing
incr
ease
d pa
ralle
l tr
adin
g an
d lo
wer
ove
rall
dem
and
for
trea
tmen
t w
ith h
orm
one
repl
acem
ent
prod
ucts
•T
he o
vera
ll m
arke
t de
man
d w
as
nega
tivel
y in
fluen
ced
by a
re
cent
ly p
ublis
hed
US
stu
dy o
f an
othe
r co
mpa
ny’s
pro
duct
0
400
800
1200
1600
1998 1999 2000 2001 20021997
DKK billion
top related