Orion – Building well-being Oyj(1).pdf · This presentation contains forward-looking statements...

Orion – Building well-beingJefferies Global Healthcare Conference

June 7, 2017 New York

Jari Karlson, CFO

Orion’s centennialwww.orion.fi/en/orion100

Investor Presentation © Orion Corporation2 2017

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 andperformance. They include statements about future strategies and anticipated benefits of thesestrategies.

These statements are subject to risks and uncertainties. Actual results may differ substantially fromthose stated in any forward-looking statement. This is due to a number of factors, including thepossibility that Orion may decide not to implement these strategies and the possibility that theanticipated benefits of implemented strategies are not achieved. Orion assumes no obligation to updateor revise any information included in this presentation.

2017 Investor Presentation © Orion Corporation3

Disclaimer

33%

47 %

7 %4 %

4 % 5 %

Sales split by business

Proprietary ProductsSpecialty ProductsAnimal HealthFermionContract manufacturingOrion Diagnostica

2017 Investor Presentation © Orion Corporation4

Orion today – year 2016 in figures

32%

16 %31 %

8 % 13 %

Sales split by market area

FinlandScandinaviaOther EuropeNorth AmericaROW

Net sales 1,074 MEUROperating profit 315 MEUR

Personnel 3 469

R&D investments118 MEUR

6 production sites inFinland

Own sales unit in26 European countries

2017 Investor Presentation © Orion Corporation5

Steady development despite patent expiries

-2%

0%

2%

4%

6%

8%

10%

0

200

400

600

800

1000

1200

2011 2012 2013 2014 2015 2016

Parkinson franchise + PrecedexOther productsGrowth, %

25%26%27%28%29%30%31%32%

050

100150200250300350

2011 2012 2013 2014 2015 2016

Operating profit

Operating profit margin

EUR million EUR million

Net sales Operating profit

44%

35%

7%

5%3% 5%

Sales by business 2011

Proprietary Products Specialty ProductsAnimal Health FermionContract manufacturing & other Orion Diagnostica

33%

47%

7%

4%4% 5%

Sales by business 2016

2017 Investor Presentation © Orion Corporation6

… and despite changes in product mix

0

200

400

600

800

1 000

1 200

2012 2013 2014 2015 2016

Net sales, EUR million

2017 Investor Presentation © Orion Corporation7

Steady sales growth for Specialty Products

0%

5%

10%

15%

20%

0

150

300

450

600

2012 2013 2014 2015 2016

EUR

mill

ion

Net sales Growth, %

Sales in 2016

59%16%

12%

13%

FinlandScandinaviaEastern Europe & RussiaROW

71%

21%

8%

Gx OTC Biosimilars

•Mainly Orion in-house developed prescriptiondrugs with valid product protection

•Global sales and R&D partner networks

Key drivers for business

áEasyhaler, Dexdor, & Simdax

áPossible milestones from development piplineprojects

áNew products from R&D pipeline

àGeneric competition for Stalevo andComtan/Comtess

050

100150200250300350400450

2012 201320142015 2016

EUR

mill

ion

Net sales

Other

Simdax

Easyhaler

Dexdor

Precedex

Stalevo/Comtess/Comtan

2017 Investor Presentation © Orion Corporation8

Proprietary Products- portfolio is today more balanced

Product IndicationNet sales

EUR millionChange

vs. 2015

1. Parkinson’s disease 124 -10%

2. Asthma, COPD 64 +24%

3. Intensive care sedative 57 +28%

4. Acute decompensated heart failure 56 +10%

5. Rheumatoid arthritis, inflammatorybowel diseases 42 +51%

6. Animal sedatives 28 +3%

7. Inflammatory pain 23 +2%

8. Intensive care sedative 20 +10%

9. Anticoagulant 18 -5%

10. Hypercholesterolaemia 18 +18%

= Products of Proprietary Products business division

2017 Investor Presentation © Orion Corporation9

Best-selling pharmaceuticals 2016

Product IndicationNet sales

EUR millionChange vs.

3M 2016

1. Parkinson’s disease 30 -7%

2. Asthma, COPD 18 +15%

3. Intensive care sedative 17 +18%

4. Acute decompensated heart failure 15 +12%

5. Rheumatoid arthritis, inflammatorybowel diseases 11 -6%

6. Animal sedatives 7 +10%

7. Intensive care sedative 7 +79%

8. Inflammatory pain 6 +10%

9. Generic entacapone products Parkinson’s disease 4 +28%

10. Hypercholesterolaemia 4 +10%

= Products of Proprietary Products business division

2017 Investor Presentation © Orion Corporation10

Best-selling pharmaceuticals 3M 2017

● Net sales and operating profit increased

● Operating profit boosted by higher milestonepayments than in previous year

● Christer Nordstedt became Senior Vice Presidentfor Research and Development in February

● Marketing authorisation application forsalmeterol-fluticasone combined formulation inEasyhaler product family submitted in Europe

262

80

279

92

Net sales,EUR million

Operating profit,EUR million

3M 2016 3M 2017

2017 Investor Presentation © Orion Corporation11

Orion’s centenary year 2017 has started well

+7% +14%

3M2017

3M2016 Change

Specialty Products 122 123 -1%

Proprietary Products 98 88 +12%

Animal Health 19 18 +5%

Fermion 16 11 +47%

Contract Manufacturing& other 11 10 +11%

Orion Diagnostica 14 14 +7%

35%

44%

7%

5%4% 5% Proprietary Products

Specialty Products

Animal Health

Fermion

Contract Manufacturing& otherOrion Diagnostica

2017 Investor Presentation © Orion Corporation12

Breakdown of net sales by business division

Net sales Net sales are estimated to be at similar level to 2016 (net sales were EUR 1,074million in 2016).

Operating profitOperating profit excluding material capital gains is estimated to be at least EUR280 million (operating profit excluding capital gains was EUR 293 million in2016).

2017 Investor Presentation © Orion Corporation13

Outlook for 2017

æGrowing net sales more rapidly thangrowth of the pharmaceuticalsmarket. Achievement of this objectiverequires continuous investment indevelopment of the product portfolio.

>Maintaining profitability at a goodlevel. The aim is operating profit thatexceeds 25% of net sales.

≥ Keeping the equity ratio at least50%.

€Distributing an annual dividend thatin the next few years will be at leastEUR 1.30 per share, and increasingthe dividend in the long term.

2017 Investor Presentation © Orion Corporation14

Orion’s financial objectives

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Opportunities and challenges

EasyhalerDexdorSimdax

R&DPipeline

ProprietaryProducts

New productlaunches

Biosimilars

SpecialtyProducts

R&DPipeline

Animal Health

QuikReadGenRead

OrionDiagnostica

Orion

Competition

Regulation

R&D risks

2017 Investor Presentation © Orion Corporation16

Together we can achieve more in R&D

Collaboration with partners

Targetidentificationand validation

8–24 mo

Hit to Leadgeneration

12–24 mo

Leadoptimisation

18–36 mo

Candidateselection,preclinical

development12–24 mo

Phase I

12–14 mo

Phase II

12–36 mo

Phase III

18–48 mo

Late stagedevelopment

Early developmentResearch

Collaboration with partners

2017 Investor Presentation © Orion Corporation17

Key clinical pharmaceutical development projects 1/2

More info about R&D projects at: http://www.orion.fi/en/rd/orion-rd/pipeline/

Project Indication PHASE Registration

Easyhaler® salmeterol-fluticasone Asthma, COPDBioequivalence

studyRegistration

Darolutamide (ODM-201) 1) Prostate cancer (nmCRPC) I II III

Darolutamide (ODM-201) 1) Prostate cancer (mHSPC) I II III

Levosimendan 2) Low Cardiac Output Syndrome I II III1) In collaboration with Bayer 2) Partner: Tenax Therapeutics, Inc. = Phase completed

= Phase ongoing

= Status changed

2017 Investor Presentation © Orion Corporation18

Key clinical pharmaceutical development projects 2/2

More info about R&D projects at: http://www.orion.fi/en/rd/orion-rd/pipeline/

Project Indication PHASE Registration

ODM-109 (oral levosimendan) ALS I II

ORM-12741 (alpha-2c adrenoceptor antagonist) 3) Alzheimer’s disease I IIa

ODM-104 (more effective COMT inhibitor) Parkinson’s disease I II

ODM-203 (targeted FGFR+VEGFR inhibitor) Solid tumours I II

ODM-207 (BET protein inhibitor) Cancer I3) In collaboration with Janssen Pharmaceuticals = Phase completed

= Phase ongoing

Dividend distribution policy

2017 Investor Presentation © Orion Corporation19

1,00

0,95

1,00

1,20

1,30

1,30

1,25

1,30

1,30

1,55

0,100,06

0,12

65%

70%

75%

80%

85%

90%

95%

100%

0,00 €

0,25 €

0,50 €

0,75 €

1,00 €

1,25 €

1,50 €

1,75 €

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016*

Repayment of capitalper share

Dividend per share

Dividend payout ratio

*) Dividend proposal by theBoD, includes extra dividend ofEUR 0.20

Orion’s dividend distribution takes into account distributable funds and capital expenditure and otherfinancial requirements in medium and long term to achieve the financial objectives.

Dividend distribution history

2017 Investor Presentation © Orion Corporation20

Orion has ~50,000 shareholders

39%

44%

6%

5%5% 1% 0%

By number of shares

Households (Finnish retail)

Non-Finnish holders andnominee-registeredPrivate corporations

Public sector

Non-profit institutions

Financial and insurancecorporationsOther

61%

10%

14%

7%

8% 1% 0%

By number of votes

OrionBuilding well-being. Together.

2017 Investor Presentation © Orion Corporation21