Investor presentation London 6 February 2020...ROSHNI Roshni is living with type 1 diabetes in...

Investor presentation

London

6 February 2020

ROSHNIRoshni is living with type 1 diabetes in India

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Agenda

Investor presentation Full year 2019

Highlights

R&D update

Financials and outlook

Sales update

Strategic aspirations 2025

Slide 2

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Forward-looking statements

Novo Nordisk’s reports filed with or furnished to the US Securities and Exchange Commission (SEC), including this presentation as well as the company’s statutory Annual Report 2019 and Form 20-F, which are both expected to be filed with the SEC in February 2020 in continuation of the publication of the Annual Report 2019, and written information released, or oral statements made, to the public in the future by or on behalf of Novo Nordisk, may contain forward-looking statements. Words such as ‘believe’, ‘expect’, ‘may’, ‘will’, ‘plan’, ‘strategy’, ‘prospect’, ‘foresee’, ‘estimate’, ‘project’, ‘anticipate’, ‘can’, ‘intend’, ‘target’ and other words and terms of similar meaning in connection with any discussion of future operating or financial performance identify forward-looking statements. Examples of such forward-looking statements include, but are not limited to:

• Statements of targets, plans, objectives or goals for future operations, including those related to Novo Nordisk’s products, product research, product development, product introductions and product approvals as well as cooperation in relation thereto,

• Statements containing projections of or targets for revenues, costs, income (or loss), earnings per share, capital expenditures, dividends, capital structure, net financials and other financial measures,

• Statements regarding future economic performance, future actions and outcome of contingencies such as legal proceedings, and

• Statements regarding the assumptions underlying or relating to such statements.

These statements are based on current plans, estimates and projections. By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific. Novo Nordisk cautions that a number of important factors, including those described in this presentation, could cause actual results to differ materially from those contemplated in any forward-looking statements.

Factors that may affect future results include, but are not limited to, global as well as local political and economic conditions, including interest rate and currency exchange rate fluctuations, delay or failure of projects related to research and/or development, unplanned loss of patents, interruptions of supplies and production, product recalls, unexpected contract breaches or terminations, government-mandated or market-driven price decreases for Novo Nordisk’s products, introduction of competing products, reliance on information technology, Novo Nordisk’s ability to successfully market current and new products, exposure to product liability and legal proceedings and investigations, changes in governmental laws and related interpretation thereof, including on reimbursement, intellectual property protection and regulatory controls on testing, approval, manufacturing and marketing, perceived or actual failure to adhere to ethical marketing practices, investments in and divestitures of domestic and foreign companies, unexpected growth in costs and expenses, failure to recruit and retain the right employees, and failure to maintain a culture of compliance.

For an overview of some, but not all, of the risks that could adversely affect Novo Nordisk’s results or the accuracy of forward-looking statements in this presentation, reference is made to the overview of risk factors in ‘Managing risks to protect value’ on pp 33-35 of the Annual Report 2019.

Unless required by law, Novo Nordisk is under no duty and undertakes no obligation to update or revise any forward-looking statement after the distribution of this presentation, whether as a result of new information, future events or otherwise.

Important drug information

• Victoza® is approved for the management of type 2 diabetes only

• Saxenda® is approved in the USA and the EU for the treatment of obesity only

Investor presentation Full year 2019 Slide 3

Strategic aspirations for 2025- Highlights 2019

Com

merc

ial

execution

Fin

ancia

ls

Patients reached with Novo Nordisk products increased by 3% to 30 million

Access to Insulin Commitment expanded with 29 middle-income countries, reaching 2.9 million patients

Circular for Zero environmental strategy introduced

Diabetes:

• Rybelsus® received approval for the treatment of type 2 diabetes in the US and positive EU CHMP opinion

• Ozempic® approved in the US for CV risk reduction

• Insulin icodec (LAI287) phase 2 trial successfully completed

Obesity:

• AM833 phase 2 trial initiated

Biopharm:

• Esperoct® approved in the US, the EU and Japan for the treatment of haemophilia A

Diabetes sales increased by 4%:

• Value market share leadership expanded by 0.8%-point to 28.6%

• Sales of GLP-1 increased by 22% reflecting solid launch of Ozempic®

Obesity sales increased by 42% to DKK 5.7 billion

Biopharm increased by 4% driven by key productsNovoEight®, Refixia®, and Esperoct®

Sales increased by 6% to DKK 122.0 billion• 11% and 1% growth in IO and NAO, respectively

Operating profit increased by 6% to DKK 52.5 billion

Free cash flow of DKK 34.5 billion

Total dividend of DKK 8.35 per share of DKK 0.20


Note: Unless otherwise specified growth rates are at constant exchange rates; CV: Cardiovascular; IO: International operations; NAO: North America operations

Purp

ose a

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inability

Innovation a

nd

thera

peutic focus

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0

10

20

30

40

50

60

70

IO Region

Europe

Region

AAMEO

Region

China

Region

J&K

Region

LATAM

NAO

11%

Reported sales split for FY 2019

Sales growth of 6% at CER, driven by solid sales growth in International Operations


GLP-1 Other diabetesInsulin

BiopharmDKKbillion

1%

7%

14%12%

5% 24%

Obesity

International Operations regions

IO: International Operations; AAMEO: Africa, Asia, Middle East & Oceania; J&K: Japan & Korea; LATAM: Latin America; NAO: North America Operations; FY: Full year

Growth at CER

Growth drivers for FY 2019

International Operations sales growth of 11% at CER supported by all regions

• Increasing sales across all therapy areas

• Broad innovative portfolio of products and new product launches

• Solid commercial execution applying a Market Fit approach

• Underlying demographic trends across IO countries

North America Operations sales increased by 1% at CER

• Sales growth in GLP-1 (+19%), Obesity (+28%), and Biopharm (+2%), offset by declining insulin sales (-16%)

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2

0

2

4

6

8

10

12

Total Insulin GLP-1 Obesity Biopharm

Sales growth of 6% at CER, driven by GLP-1, Obesity, and Biopharm, partly offset by declining US insulin sales


Added reported sales and growth per therapy area and operational unit at CER

International Operations North America Operations

1 “Other diabetes“ is included in TotalCER: Constant exchange rates

1%

11%

7%

-16%

19%

32%

28%

73%5%

2%

1

6% -3% 22% 42% 4%

Growth at CER• Novo Nordisk expands global diabetes value market

leadership by 0.8%-point to 28.6%

• Global insulin volume market share increased 0.2%-point to 46.5%

• Novo Nordisk expands GLP-1 market leadership by 1.3%-points to 47.5% value market share

• Saxenda® now launched in 46 countries

• Biopharm sales increased 4%, at CER, driven by new products and both operating units

Growth drivers for FY 2019

Therapy areas

Source: IQVIA MAT, Nov 2019

DKKbillion

Slide 6

36.8%

13.3%

7.1%

56.6%

6.4%0%

10%

20%

30%

40%

50%

60%

USA GLP-1 NBRx market share

Ozempic® and Rybelsus® US launches have increased Novo Nordisk GLP-1 NBRx market share, resulting in TRx market leadership


USA GLP-1 TRx market growth and market share

Source: TRx-IQVIA Xponent, Dec 2019TRx: Total prescriptions1 Q4 2019 vs. Q4 2018

Jan2019

Dec2019

Weekly NBRx share

Source: NBRx-IQVIA National LRx Weekly, week ending 27 Dec 2019NBRx: New-to-brand prescriptions

NN GLP-1

Victoza®

Ozempic®

dulaglutide other

Rybelsus®

Jan2019

Dec2019

46.8%

44.9%

8.3%

20.6%

0%

20%

40%

60%

80%

0.0

0.5

1.0

1.5

2.0Market growth: 32%1

TRx volume (million)

TRx share

NN GLP-1 dulaglutide otherOzempic®

36.4%

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0

3

6

9

IO Region

Europe

Region

AAMEO

Region

China

Region

LATAM

Region

Japan &

Korea

60.0%

61.4%

0%

20%

40%

60%

80%

NN share of growthNN market share

Source: IQVIA 3 months rolling value, Nov 2019SoG: Share of growth Countries included: Belgium, Czech Republic, Denmark, Finland, France, Hungary, Ireland, Italy, Luxembourg, Netherlands, Norway, Slovakia, Spain, Sweden, Switzerland and the UK

Strong GLP-1 sales growth in IO driven by Ozempic® launch uptake in Europe and GLP-1 portfolio across regions


Nov 2017

Nov2019

Reported GLP-1 sales, growth, and share of regional growth per region

1st European launch

GLP-1 value market share and share of growth in select European launch markets

DKKbillion

31%

70%15% 14%55%

GLP-1 growth at CER

32%

76%

7% 26% 31% 29%

GLP-1 share of growth

IO: International Operations

International Operations regions35%

Market Share

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56%

0%

20%

40%

60%

0.0

0.4

0.8

1.2

1.6

Reported sales split in operational units Novo Nordisk remains global market leader

Global rollout and promotional activities drive 42% at CER, Saxenda® sales growth for 2019


DKK billion

Source: IQVIA monthly, Nov 2019Note: Growth rates are at CERIO: International Operations; NAO: North America Operations

Q2 Q3 Q4 Q2

North America OperationsInternational Operations

ION

AO

• Sales growth of 73% driven by all regions

• Novo Nordisk currently has a value market share of 36% in the obesity market

• Sales growth of 28% driven by both the USA and Canada

• Novo Nordisk currently has a value market share of 70% in the obesity market

Glo

bal

• Novo Nordisk expands market leadership to 56% value market share from 48%

• Saxenda® is now launched in 46 countries

• Continued investments in market development activities

Growth at CER

Q1Q3 Q1Q4Q2Q1

64%

42%

Note: Numbers in the graph are reported quarterly salesCER: Constant exchange rates

51%

2017 2018 2019

Q3 Q4

Value market share Market Share

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0.0

0.2

0.4

0.6

0.8

1.0

1.2

Haemophilia


Solid commercial execution and new product launches drive 4%, at CER, Biopharm sales growth

Increase in reported Biopharm sales across products Biopharm sales driven by global commercial execution

Biopharm sales growth driven by 5% in International Operations and by 2% in North America Operations

Haemophilia sales increased by 4% driven by

• Continued global rollout of NovoEight®, Refixia® ,and Esperoct®

• Stable NovoSeven® sales, reflecting the solid position in a competitive market

Novo Nordisk retains global market leadership in the human growth disorder market with a 33% value market share

Note: ‘Other haemophilia’ includes Esperoct®, NovoThirteen® and Refixia®; ‘Other Biopharm’ includes primarily Vagifem® and Activelle®

Total Novo-Seven®

NovoEight® Other haemo-philia

Nordi-tropin®

Other Biopharm

4% 0% 10% 81% 2% 6%

Growth at CERDKK billion

Note: Sales growth reported at constant exchange rates

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Ozempic® receives CV risk reduction indication in the US, Rybelsus®

receives CV safety label update in the US and positive CHMP opinion


Cardiovascularindication in the US

Ozempic® is indicated for1:• Adults with type 2 diabetes• Reducing the risk of major

adverse cardiovascular events in adults with type 2 diabetes and established cardiovascular disease 0

5

10

15

0 4 8 12 16 20 24

Patients

with a

n

event

(%)

Months

MACE

Placebo: 8.9%

Semaglutide: 6.6%

The proportion of patients who experienced at least one MACE was 3.8% with Rybelsus® and 4.8% with placebo

Non-inferiority was established, with a hazard ratio equal to 0.79 [95% CI: 0.57, 1.11]

SOUL Cardiovascular Outcomes trial

9,642 people

with type 2 diabetes Placebo + SOC

Oral sema 14 mg + SOC

Event-driven

Positive CHMP opinion in the EU

Rybelsus® is indicated as monotherapy when metformin is considered inappropriate for the treatment of type 2 diabetes1

Cardiovascular

update in the US

CV: Cardiovascular; CVD: Cardiovascular disease; MACE: Major adverse cardiovascular event; 1 Abbreviated version of the approved product information

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Insulin icodec (LAI287), a novel once-weekly insulin analog, versus insulin glargine

Icosema (LAIsema), a combination of once-weekly icodec and once-weekly semaglutide

Insulin icodec (LAI287) phase 2 and icosema (LAIsema) phase 1 trials successfully completed


247 peoplewith type 2

diabetes

Icodec (weekly) + metformin ± DPP-4i (+ daily placebo)

Results• Change in HbA1c from baseline: insulin icodec, -1.33%-points

vs. insulin glargine U100, -1.15%-points

• Low rates of hypoglycaemic events for both arms

• No unexpected safety events

• Phase 3 initiation planned for second half of 2020

Icosema Sema Icodec30 people with type 2

diabetes

Details

• Investigated safety, tolerability and pharmacokinetics

• Following the completion of the phase 1 trial, icosema is now being evaluated for further clinical trial development

5 weeks PK

1:1

Insulin glargine U100 (daily) + metformin ± DPP-4i (+ weekly placebo)

1 A phase 2, double-blinded and treat-to-target trialPK: PharmacokineticsNote: Insulin icodec is the international non-proprietary name

1-4 week washout

5 weeks PK

5 weeks PK

1-4 week washout

1

2 A phase 1 trial with only one of six possible treatment sequences shownSema: Semaglutide; PK: Pharmacokinetics Note: Icosema is the international non-proprietary name

2

Slide 12

R&D milestones in 2020Project Q1 2020 Q2 2020 Q3 2020 Q4 2020

Rybelsus®

(Oral semaglutide)

Clinical milestones1 Regulatory milestones1

√


1 Expected to be published in the given quarter or in the subsequent quarterly company announcement; 2 Obesity projects include GG-co-agonist and Tri-agonist 1706 Sema: Semaglutide; GIP: Gastric inhibitory polypeptide; EU: European Union; JP PMDA: Japanese Pharmaceutical and Medical Devices Agency; OW: Once-weekly; AGHD: Adult growth hormone deficiency; PoC: Proof of Concept

✓

✓JP PMDA decisionEU CHMP decision

Xultophy® China submission

Icodec

✓

Obesity Projects2 Phase 1 results

Mim8

✓

Sema+OW GIP

Semaglutide NASH Phase 2 results

Diabetes Haemophilia Growth disordersObesity Other serious chronic diseases

Amylin - AM833

Phase 1 initiation

✓

✓

✓

PCSK9i

Phase 2 initiation

Phase 3 initiation

EU commission decision

Semaglutide Phase 3 results

Phase 2 results

LA-GDF 15 Phase 1 results

Phase 1/2 initiation

Somapacitan(AGHD) JP submission US/EU decision

Phase 2 results (PoC, Gilead)

FGF-21 NASH

Phase 1 results

✓

Phase 2 results ✓

CV label update ✓

Ozempic® CV label indication ✓China submission

SUSTAIN FORTE –Phase 3 results

✓

Slide 13

Financial results – Full year 2019


CER: Constant exchange rates

In DKK million 2019 2018

Change (reported)

Change (CER)

Sales 122,021 111,831 9% 6%

Gross profit 101,933 94,214 8%Gross margin 83.5% 84.2%

Sales and distribution costs 31,823 29,397 8% 6%

Percentage of sales 26.1% 26.3%

Research and development costs 14,220 14,805 (4%) (6%)Percentage of sales 11.7% 13.2%

Administration costs 4,007 3,916 2% 1%Percentage of sales 3.3% 3.5%

Other operating income, net 600 1,152 (48%)

Operating profit 52,483 47,248 11% 6%Operating margin 43.0% 42.2%

Financial items (net) (3,930) 367

Profit before income tax 48,553 47,615 2%

Income taxes 9,602 8,987 7%Effective tax rate 19.8% 18.9%

Net profit 38,951 38,628 1%

Diluted earnings per share (DKK) 16.38 15.93 3%

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0

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30

45

2017 2018 2019 2020E

Expected cash return to shareholders in 2020 and long-term financial targets have been met

1 For 2020, expected free cash flow is DKK 36-41 billion.

Note: Share repurchase programmes run for 12 months starting Feb until end-Jan of the following year.


Cash return prioritiesAnnual cash return to shareholders

• For 2019, the proposed total dividend increased 2.5% to DKK 8.35 per share including interim dividend of DKK 3.00 per share paid in August 2019.

• For 2020, a new share repurchase programme of up to DKK 17 billion is expected

• Total programme may be reduced in size if significant bolt-on acquisition opportunities arise during 2020

DKK billion

Share repurchase

Dividend

Free cash flow

Interim dividend

Free cash flow guidance

Novo Nordisk has met its long-term financial targets

Cash Conversion (three-year average)

Target: 85%2019: 86%

OPAT/NOATarget: 80%2019: 98%

Average operating profit growthTarget: 5%

2016-2019: 4.9%1

Slide 15

Financial outlook for 2020

The financial outlook is based on an assumption of a continuation of the current business environment and given the current scope of business activities and has been prepared assuming that currency exchange rates remain at the level as of 31 January 2020. CER: Constant exchange rates


Sales growth – at CER

Sales growth - reported

Operating profit growth – at CER

Operating profit growth - reported

Financial items (net)

Effective tax rate

Capital expenditure

Free cash flow

Depreciation, amortisation and impairment losses

Expectations5 Feb 2020

3% to 6%

1% to 5%

Loss of around DKK 1.5 billion

20% to 22%

Around DKK 6.5 billion

Around DKK 5 billion

DKK 36 to 41 billion

Around 1 percentage point higher

Around 1 percentage point higher

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Strategic aspirations for 2025- Milestones expected for 2020

Purp

ose a

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susta

inability

Com

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execution

Innovation a

nd

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Fin

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Expansion of the US affordability offerings

Utilise solar energy power across all US operations

100% renewable power in 2020 for all production sites

Diabetes:• Sema FORTE phase 3 results due Q4 2020• Insulin icodec phase 3 initiation due in the second

half of 2020Obesity:• Semaglutide obesity phase 3 results due mid-2020• Amylin phase 2 resultsBiopharm:• Mim8 phase 1/2 initiated• Somapacitan regulatory feedback from the FDA/EMA

for the treatment of AGHDOther serious chronic diseases:• Phase 2 readouts from two NASH trials

Expand diabetes market leadership led by launches and penetration of Ozempic®, Rybelsus®, and new-generation insulin

Strengthen Obesity leadership with continued global rollout and penetration of Saxenda®

Continued launches of key Biopharm products Refixia® and Esperoct® support sustained growth outlook

Sales growth expected to be 3-6% (reported: around 1 percentage point higher)

Operating profit growth expected to be 1-5% (reported: around 1 percentage point higher)

Free cash flow in the range of DKK 36-41 billion

DKK 17 billion share repurchase programme


Note: Outlook as of 5 February 2020; Unless otherwise specified growth rates are at constant exchange rates; FDA: Food and Drug Administration; EMA: European Medicines Agency; AGHD: Adult growth hormone disease; NASH: Non-alcoholic steatohepatitis; New-generation insulin: Tresiba®, Xultophy®, Ryzodeg®, Fiasp®

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Share information Investor Relations contacts

Investor contact information


Novo Nordisk’s B shares are listed on the stock exchange in Copenhagen under the symbol ‘NOVO B’. Its ADRs are listed on the New York Stock Exchange under the symbol ‘NVO’.

For further company information, visit Novo Nordisk on: www.novonordisk.com

Peter Hugreffe Ankersen +45 3075 9085 [email protected]

Valdemar Borum Svarrer +45 3079 0301 [email protected]

Ann Søndermølle Rendbæk +45 3075 2253 [email protected]

Mark Joseph Root +45 3079 4211 [email protected]

Kristoffer Due Berg (USA) +1 609 235 2989 [email protected]

Novo Nordisk A/S Investor Relations Novo AlléDK-2880 Bagsværd

Upcoming events

26 Mar 2020 Annual General Meeting

06 May 2020 Financial statement for the first three months of 2020

06 Aug 2020 Financial statement for the first six months of 2020

30 Oct 2020 Financial statement for the first nine months of 2020

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mailto:[email protected]





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