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Hikma Pharmaceuticals PLC 2014 Preliminary Results
Founded in Jordan in 1978.
Public company listed on London Stock
Exchange in November 2005
Multinational business, developing,
manufacturing & marketing branded,
injectable & Oncology pharmaceuticals
on a global scale.
Operations in Middle East & North Africa,
US and Europe employing over around
6,600 people, of which around 2,000 are
in Jordan.
State-of-the-art manufacturing facilities;
several of which have been US FDA
approved.
Fourth largest listed pharmaceutical
company in the UK.
Our company
Page 2
Hikma Mission and Goals
Mission
We are committed to improving peoples’ lives. Through our existing products, and with 527 pending approvals across our markets, our aim is to provide patients with better access to high-quality, cost-effective medicines in key therapeutic areas.
• Maintain/consolidate market leadership position in MENA and EU
• At least double size every four years
• Expand in new therapeutic areas and markets
• Leverage on scale and image to achieve cost-saving synergies and transfer our expertise between our different geographical sites
Goals
OST Analysis
Page 3
Strengths
Threats Opportunities
• Excellent reputation for quality and a leading
position in MENA
• Significant local presence in many MENA
countries
• Excellent track record with licensors
• Large product portfolio in MENA
• Political turbulence
• Increasing competition from multinationals
interested in emerging markets
• Governments may induce price cuts to offset
increase in healthcare bill
• Expansion of local / regional players (Spimaco,
Kindi, Julphar)
• Changing and stricter regulations by many
MENA regulators
• Strong demographics in MENA
• Governments under pressure to increase
healthcare coverage
• Still low penetration in many therapeutic
categories
Weaknesses
Our Strategy For Growth
Page 4
Strengthen our leading position in the MENA region
Develop our global product range in growing therapeutic areas
Extend our reach and diversity as a partner of choice in the MENA region
Increase the scale of our specialty Injectables business
Leverage our expertise and capacity in the US market
Build on our world-class manufacturing and API sourcing capabilities
A strong one track record
of revenue growth
Hikma in Brief | Commercial | R&D| Operation | Regulatory | Business Development | Why Hikma?
Group revenues ($
million)
0 0 0 0 0 0 0 0 0 0
100
200
300
400
500
600
700
800
900
1000
1100
1200
1300
1400
1500
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
6
Our diversified business model continues to deliver strong growth
Group revenue ($ million)
Became a public company listed on LSE
Acquired Hikma Italy
Began manufacturing operations in Trust Pharma (Algeria)
Acquired 52.5% of JPI (KSA) not previously owned by Hikma
Acquired Baxter’s Multi Source Injectables (US)
Acquired 94.1% of Promopharm (Morocco)
Acquired Elie Pharmaceuticals (Sudan)
Acquired minority stake in Unimark (India) and Haosun (China)
Acquired Ribosepharm and Thymoorgan (Germany)
Acquired Alkan (Egypt) and APM (Jordan)
CAGR 05-14: 21% Acquired Ibn Al Baytar/ Medicef (Tunisia)
Acquired Al Dar Al Arabia (Algeria)
Acquired EPCI (Egypt)
Entered into JV in Ethiopia
Acquired Bedford and Ben
Venue (US)
US Focusing on growing our
market share by value
and developing our
portfolio
CAPABILITIES
Vials, ampoules, pre-filled syringes
MANUFACTURING:
Multi Source Injectables
COMPETITORS
Hospira, APP, Sandoz , American
Regent, Sagent
76.9% of Injectables revenue*
TOP PRODUCTS:
Glycopyrrolate
Neostegmine
Phenylephrine
Fentanyl
Argatroban
EUROPE A broad portfolio across a
range of product types and
therapeutic areas
CAPABILITIES
Vials, ampoules, bags, cytotoxics, pre-
filled syringes
MANUFACTURING:
US FDA, EU and MENA approved
manufacturing facilities in Portugal,
Italy and Germany
COMPETITORS
Actavis, Fresenius, Sandoz, Stada,
Teva
10.5% of Injectables revenue*
TOP PRODUCTS:
Meropenem
Vancomycin
Cefuroxime
Imipenem
Cefazolin
MENA Continued new product
launches and expansion
into new markets
COMPETITORS
Roche, Sanofi, Julphar, Tabuk, MSD,
Pfizer
12.6% of Injectables revenue*
TOP PRODUCTS:
Samixon
Ciprolon
Hibor
Prizma
Cefizox
KEY
7 MANUFACTURING PLANTS
2 R&D CENTRES
* 2014 Injectables revenue
7
Our business segments
Hikma Pharmaceuticals in MENA
Lebanon
Jordan
Algeria
Tunisia
Libya Egypt
Sudan
Saudi Arabia
Yemen
Iraq
Syria
Oman
Morocco
Bahrain & Qatar
Kuwait
UAE
Lebanon
Jordan
Algeria
Tunisia
Libya Egypt
Sudan
Saudi Arabia
Yemen
Iraq
Syria
Oman
Morocco
Bahrain & Qatar
Kuwait
UAE
Lebanon
Jordan
Algeria
Tunisia
Libya Egypt
Sudan
Saudi Arabia
Yemen
Iraq
Syria
Oman
Morocco
Bahrain & Qatar
Kuwait
UAE
Jordan Jordan
Algeria
Tunisia
Libya Egypt
Sudan
Saudi Arabia
Yemen
Iraq
Syria
Oman
Morocco
Algeria
Tunisia
Libya Egypt
Sudan
Saudi Arabia
Yemen
Iraq
Syria
Oman
Morocco
Algeria
Tunisia
Libya Egypt
Sudan
Saudi Arabia
Yemen
Iraq
Syria
Oman
Morocco
Algeria Algeria
Tunisia
Libya
Tunisia Tunisia
Libya Egypt Egypt
Sudan Sudan
Saudi Arabia Saudi Arabia
Yemen Yemen
Iraq Iraq
Syria Syria
Oman Oman
Morocco Morocco
Bahrain & Qatar
Kuwait
UAE
The MENA market totals 350M in population with a
total GDP of $2 trillion
1
2
3
4
5
6 7
8
9
The pharmaceutical market exceeds $18 billion, growing at an 8%
yearly average
33M
39M
6M
82M
29M
24M
23M
3M
4M
4M
11M
33M 6M
9M
4M
38M
2% of the world’s pharmaceutical market
~3% of the world’s GDP
Top 9 IMS MENA markets
Source: Population 2013 World Bank
MENA and Turkey makes the third largest
population in the world
MENA population (17 countries including
Turkey) is the 3rd largest in the world
after China and India
Fast growing population in the MENA
region. Population levels in 2013
reached around 350 million (excluding
Turkey), with a 10-13 CAGR of 2%
MENA GDP is 10th largest in the world
and second only to China in emerging
markets.
2.1 2.2 3.0
1.9
9.2
0.8
11%
2% 3% 3%
16%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
10
-13
GA
GR
%
GD
P T
rilli
on
USD
143 200 350
1,252 1,357 75
- 200 400 600 800
1,000 1,200 1,400 1,600
20
13
Po
pu
lati
on
(M
illio
ns)
Source: 2013 World Bank
MENA healthcare CAGR is 2nd in the world
MENA’s healthcare expenditures/capita has significant room for growth. It comes in
2nd (after China) in terms of CAGR.
At this growth rate, MENA’s healthcare spent per capita will reach $496 in five years.
9%
14%
23%
4%
13% 12%
1%
11%
4%
0%
5%
10%
15%
20%
25%
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
India MENA China Turkey Russia Brazil EU Japan USA
07
-12
GA
GR
%
He
alth
Exp
en
dit
ure
Cap
ita
in U
SD MENA Health Expenditure
Source: 2013 World Bank
Iraq and Algeria have the highest healthcare CAGR
among MENA countries
Source: 2013 World Bank
The relatively high growth in per capita health expenditure is primarily driven by Iraq.
Again, we see a wide range across MENA countries spanning from USD 71 in Yemen
to USD 2,029 in Qatar.
Recent political unrest in the region expected to increase public health expenditure.
71 105 115 226 152 190 279 297 388 578
690 675 795 895
1,343 1,428
2,029
4% 6% 6%
19%
12%
7%
16%
7% 9%
16%
11%
7% 7% 7% 3%
8% 5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
0
500
1000
1500
2000
2500
07
-12
CA
GR
%
USD
MENA Healthcare Expenditure per capita USD
Hikma ranks 5th in MENA
81
Morocco
142
Algeria
219
Tunisia
56
Lybia
32
Egypt
397
Sudan
88
Jordan
252
Lebano
n
Syria
2
Iraq
60
Kuwait
9
Saudi
Arabia
247
UAE
45
Bahrain & Qatar
19
Yemen
16
Oman
12
Next >>
Sales & Marketing Team in the MENA Region
>> Top 3 selling products
Our unique sales & marketing team of more than
1,600 is driving growth
Amoclan
Lexin
Torvast Megamox/Amoclan
Tavacin
Pepzol
Amoclan
Suprax
Penamox
Megamox/Amoclan
Xefo
Omnicef
Our reach
Lebanon
Jordan
Algeria
Tunisia
Libya Egypt
Sudan
Saudi Arabia
Yemen
Iraq
Syria
Oman
Morocco
Bahrain & Qatar
Kuwait
UAE
Lebanon
Jordan
Algeria
Tunisia
Libya Egypt
Sudan
Saudi Arabia
Yemen
Iraq
Syria
Oman
Morocco
Bahrain & Qatar
Kuwait
UAE
Lebanon
Jordan
Algeria
Tunisia
Libya Egypt
Sudan
Saudi Arabia
Yemen
Iraq
Syria
Oman
Morocco
Bahrain & Qatar
Kuwait
UAE
Jordan Jordan
Algeria
Tunisia
Libya Egypt
Sudan
Saudi Arabia
Yemen
Iraq
Syria
Oman
Morocco
Algeria
Tunisia
Libya Egypt
Sudan
Saudi Arabia
Yemen
Iraq
Syria
Oman
Morocco
Algeria
Tunisia
Libya Egypt
Sudan
Saudi Arabia
Yemen
Iraq
Syria
Oman
Morocco
Algeria Algeria
Tunisia
Libya
Tunisia Tunisia
Libya Egypt Egypt
Sudan Sudan
Saudi Arabia Saudi Arabia
Yemen Yemen
Iraq Iraq
Syria Syria
Oman Oman
Morocco Morocco
Bahrain & Qatar
Kuwait
UAE
Corporate Marketing is leading S&M teams in the 5 Territories
5 Territories each with full Sales &
Marketing structure ensure efforts are
tailored to markets needs%
Hikma MENA Market is divided into 5 marketing
territories
Source: Hikma Internal data
Sa
le
s in
$
A partnership-oriented company!
Our top selling products in MENA
0
10
20
30
40
50
60
70
8078
54
30
20 17
15 13 12
10 10
17
Our strategy to drive continued growth in MENA and emerging
markets
MAXIMISING
PORTFOLIO
OPPORTUNITIES
THROUGH OUR
FOCUS ON
HIGHER VALUE
PRODUCTS AND
ENHANCED
SALES &
MARKETING
ACTIVITIES
INVESTING TO
EXPAND OUR
PORTFOLIO,
TECHNOLOGICAL
CAPABILITIES
GEOGRAPHIC
REACH AND
MANUFACTURING
CAPACITY
THROUGH
CAPITAL
INVESTMENT AND
M&A
MAINTAINING
HIGH QUALITY,
EFFICIENT AND
REGULATORY
COMPLIANT
MANUFACTURING
FACILITIES
STRENGTHENING
AND
BROADENING
OUR PRODUCT
PORTFOLIO AND
TAILORING OUR
PRODUCT
OFFERINGS TO
LOCAL MARKET OPPORTUNITIES
BUILDING A
HIGHLY
SKILLED,
EFFECTIVE AND
DIVERSE
WORKFORCE
ENSURING
SUSTAINABLE
LONG TERM
GROWTH BY
INCREASING
PATIENT
ACCESS TO
HIGH QUALITY,
AFFORDABLE
MEDICINES
COMMERCIAL PIPELINE
DEVELOPMENT
INVESTING FOR
GROWTH EMPLOYEES SUSTAINABILITY
OPERATIONAL
EXCELLENCE
AND COST
CONTROL
SAUDI
ARABIA &
OTHER
GCC
ALGERIA
EGYPT MOROCCO
LEVANT &
OTHER
MARKETS
EMERGING
MARKETS
DELIVERING OUR
STRATEGY
THROUGH 6
KEYSTRATEGIC
PILLARS
LEADING
PHARMACEUTICAL
COMPANY IN
MENA AND
EMERGING
MARKETS
Our partners
- More than 1600 sales Representatives across MENA - Reputation for quality products and long standing relationships with global licensing partner - Strong brand recognition and experienced marketing teams with strong customer loyalty - Excellent knowledge of registration processes and local health authorities - Extensive Distribution network across MENA
- Local manufacturing facilitates market Access
Partner of choice in MENA region
Why Hikma?
Location
# of
facilitie
s
Oral/semi-
solid/liquid Injectable API
Certification
FDA EU Local
cGMP Other
CherryHill, MSI 1
Morocco 1
Eatontown, NJ
USA 1 OSHA, DEA, EPA
Amman, Jordan 5 (1)
Sintra, Portugal 3 (2)
Pavia, Italy 1 (3)
Vienenburg,
Germany 1 (4)
Riyadh, Saudi
Arabia 1 (5)
Algiers, Algeria 2
Cairo, Egypt 1
Tunis, Tunisia 2
Summary of our operations …
(1) Certification by UK MHRA, (2) Certification by Infarmed, Portugal, (3) Certification by Italian Ministry of Health, (4) Certification by the German Ministry of Health, (5) Certification by Slovakian State Institute for Drug Control
Our Operations
15
8
9
8
3
2
1
8
3
41
7
Regulatory Personnel
Our regulatory personnel
6/4/2015
Our hospital advantage
Commercial Superiority
Regulatory & Medical
Excellence Locally Focused
More than $90M of hospital
revenues
17 countries covered under
one roof
127 specialized hospital sales
representative
>10 Under licensed
innovative hospital
products:Vibativ®,Cefizox ®,
Infasurf®, Prizma®, Hibor®
>1,000 hospitals covered
>90% reach to Government,
Private & Teaching hospitals
Long term partnership with
key medical societies
Excellent relations with
governmental authorities
Complete and thorough
understanding of local rules &
regulations
Dedicated Regulatory Affairs
(RA) team > 70 persons with
> 50 years experience
US FDA & MHRA approved
PV systems
Parallel submission in 6
countries simultaneously
Capabilities of supervising
Phase III Clinical trials &
conducting P IV
25 manufacturing facilities in
11 countries
FDA approvals in 5
countries
Faster registrations
Preferred prices
Preferential treatment in
Tenders
Operations in Middle East &
North Africa, US and Europe
employing over around
6,600 people
Diversified product portfolio
manufactured
Compliance & Quality
London stock exchange
listed company.
Top 250 FTS
Highest Ethical standards in
business conduct
Zero tolerance policy to all
forms of bribery and
corruption.
Ethics Committee reporting
to the Company Board of
Directors
Reputation of Quality
products
37%
48%
15%
Branded Injectables Generics
2014 revenue by segment 2014 revenue by region
43%
51%
6%
MENA US Europe & ROW
Revenue by segment and region
23
Branded: Hikma’s Footprint
► Hikma’s Sales and Marketing team comprises more than 1,849 employees, one of the largest in the MENA region
► Products are manufactured at facilities in Jordan, Algeria, Saudi Arabia, Egypt, Sudan, Tunisia and Morocco. Track record of
investing in local markets
► Facilities in Jordan and Saudi Arabia have been successfully inspected by the US FDA and MHRA
► Excellent knowledge of local regulations and significant experience of working with local health authorities
Jordan
Jordan
Algeria
Tunisia
Libya
Egypt
Sudan
Saudi
Arabia
Yemen
Iraq
Oman
Morocco
Kuwait
UAE
Lebanon
Source: Arab Health World.
Note: (1) Includes distribution, wholesale and warehousing.
KEY
Footprint(1)
Manufacturing
Qatar Bahrain
Ethiopia
Direct Presence
Indirect Presence
Mali
Senegal
Somalia
Azerbaijan
Ivory Coast
53
Branded: Hikma’s Manufacturing Capabilities
Morocco Tunisia Algeria Egypt Jordan KSA Sudan
Facility Société de
Promotion
Pharmaceutique
2 Plants
Medicef
Ibn Al Bitar
3 Plants
Dar Al Arabia
Hikma Pharma
Algeria
2 Plants
Hikma Pharma
Egypt
EPCI
2 Plants
Hikma
Pharmaceuticals
LLC
APM
5 Plants
Al Jazeerah
Pharmaceutical
Industries
3 Plants
Savanna
3 Plants
Types of
production
Penicillin
General
Formulation
Penicillin
Cephalosporin
General
Formulation
Penicillin
General
Formulation
Cephalosporin
General
Formulation
Penicillin
Cephalosporin
General
Formulation
Chemical
Penicillin
Cephalosporin
General
Formulation
Penicillin
Cephalosporin
General
Formulation
Certification
Local Local Local
EU
Local
Other
US
EU
Local
Other
US
Local Local
► Hikma manufactures its Branded products at 20 facilities
55
Injectables: Hikma’s Manufacturing Capabilities
USA Portugal Italy Germany
Facility
Number of
Employees(1) 793 326 68 70
PP&E(2)
$62.6m $73.6m $7.3m $8.6m
Types of production
Vials / ampoules /
pre-filled syringes(3)
Cephalosporins
ampoules / vials /
bags/ lyophilised/
pre-filled syringes(3)
Lyophilised
Ampoules /
Vials
Cytotoxics -
liquids &
lyophilised
Main markets
(Primary Focus) USA
EU
USA
MENA
CIS
MENA
EU
EU
MENA
USA
Date of last FDA
Inspection April 2014 March 2014 N/A May 2014
Note: (1) Related to manufacturing.
(2) Includes buildings, computers and software, furniture and equipment, projects under progress and vehicles.
(3) Pre-Filled Syringes capabilities currently being installed.
► In July 2014, Hikma agreed to acquire the Ben Venue manufacturing site in Bedford, Ohio. The Ben Venue site is not currently operational. Hikma
plans to transfer certain modern equipment, including lyophilisers and filling lines, to its other global manufacturing facilities in the US and Europe,
significantly increasing Hikma’s manufacturing capacity and capabilities
44
Successfully leveraging our corporate and local R&D centres
Jordan
Jordan Tunisia
Algeria
Jordan
37 launches
106 submissions
121 R&D employees
Therapeutic areas:
- Central nervous system
- Anti-infectives
- Cardiovascular
- Diabetes
- Oncology
Egypt
Egypt
51 launches
133 submissions
14 R&D employees
Therapeutic areas:
- Central nervous system
- Cardiovascular
- Diabetes
- Ophthalmics
- Oncology
Algeria
46 launches
77 submissions
8 R&D employees
Therapeutic areas:
- Central nervous system
- Cardiovascular
- Diabetes
- Anti-infectives
- Oncology
Tunisia
29 launches
65 submissions
7 R&D employees
Therapeutic areas:
- Central nervous system
- Cardiovascular
- Diabetes
- Anti-infectives
- Oncology
Saudi
Arabia
Saudi Arabia
30 launches
66 submissions
19 R&D employees
Therapeutic areas:
- Central Nervous
System
- Cardiovascular
- Diabetes
- Oncology
Total number of launches and submissions since 2009
Launches and submissions in Algeria, Egypt, Jordan, Saudi Arabia and Tunisia, 2009 to 2014
14%
18%
5%
16% 6% 3%
38%
2015E
23%
30%
8%
11%
22%
6%
2013
Cardiovascular Anti-infectives Opthalmic Dermatology & creams CNS Diabetes Oncology Others
69 launches 59 launches
10%
23%
2% 39%
8%
19%
2014
Expecting to launch around 200 products over the next two years
Developing our Branded pipeline to meet growing demand in
specific therapeutic areas
28
Branded launches by therapeutic area
12%
12%
13%
48%
1% 15%
2016E
29
Investing in R&D and business development to build a strong pipeline
► Developing related growth strategies that build on and reinforce our strong legacy business
► Diversifying into new areas with attractive market dynamics – such as dermatologics, opthalmics and oncology
► Focusing on niche market segments, including controlled substances, transdermals, inhalations, PIV/ 505(b)(2)s and
authorised generics
3
1
3 5 5
3
10 7
4
1 3
2
4
1
1
1
1
3
3
1
1
0
2
4
6
8
10
12
14
16
18
20
2015 2016 2017 2018 2019 2020
Patches & transdermals Orals - controlled release Orals - other specialised Opthalmics
Oncology Other dermatologics Ihalataion Other orals
Generics expected launches, 2015 to 2020
Our strong track record of growth across the MENA markets
*Constant currency; based on 2009 exchange rates
**Source: IMS Health.
353
394 442
529 554
551
Expecting low-teens growth in constant currency in 2015
353
398
451
561
628 631
2009 2010 2011 2012 2013 2014 2015E
Reported Constant
Hikma 5-year CAGR (reported): 9%
Hikma 5-year CAGR (constant): 12%*
MENA market 5-year CAGR: 9%**
► Expecting to return to low-teens growth
in 2015 (constant currency)
► MENA pharmaceutical market continues
to offer very attractive growth
opportunities
► Expanding our portfolio of higher value
products
► Leveraging our large and experienced
sales and marketing team
► Future growth will be driven by
expansion in existing and new markets,
through greenfield investments and M&A
2
Branded revenue, 2009 to 2014
Building a leading global manufacturer of high quality, affordable
generic injectable products
31
144 157
316
470
536
713
2009 2010 2011 2012 2013 2014 2017E
► Launch of Bedford products will be a
key driver of growth
► Leveraging Bedford’s R&D
capabilities, external R&D partners
and business development to build
our pipeline
► Expanding our presence in Europe
and MENA will enhance revenues and
profitability
► Focusing on maintaining the highest
quality standards across our
manufacturing facilities
Hikma 5-year revenue CAGR: 38%
Injectables revenue, 2009 to 2014
Strong medium-term
growth potential driven by
broad product portfolio and
differentiated pipeline
US generic Injectables market share (million eaches) US generic injectables market share ($ million)
Successfully growing our US market share by value
32
39.9%
13.0% 13.0%
4.5% 4.4% 3.6% 2.0% 1.6% 1.4% 1.4% 1.3% 1.3%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
Market Share
Dec 2013 Dec 2014 Change
Value 4.0% 6.1% +2.1 ppt
Market Share
Dec 2013 Dec 2014 Change
Volume 13.9% 13.0% (0.9) ppt
Source: IMS Healthcare, YTD 12/2014
Source: IMS Healthcare, YTD 12/2014
17.5%
11.0%
9.6%
6.1% 6.1% 5.4% 5.3% 5.1%
4.2% 4.1% 3.4% 3.2%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
20.0%
Thank you
