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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
2017 Investor Presentation © Orion Corporation15
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