Novo Nordisk Global Focused Pharmaceutical with Biotech Expertise Mads Krogsgaard Thomsen Chief...

Novo Nordisk

Global Focused Pharmaceutical with Biotech Expertise

Mads Krogsgaard ThomsenChief Science Officer

February 2001

2

Diabetes Carebusiness

ZymoGenetics HRT

Novo Nordisk – Key drivers

Primary growth drivers

Secondary value

drivers

Coagulation disorders

Human growth hormone

3

Novo Nordisk Net turnover split by therapy

DKK billion

0

5

10

15

20

25

1996 1997 1998 1999 2000

Coagulation disorderDiabetes careHuman growth hormoneHRTOther

Glo

bal

Fo

cuse

d

Ph

arm

aceu

tica

l w

ith

B

iote

ch E

xper

tise

L

ead

er

in d

iab

ete

s ca

re

S

tron

g m

ark

et p

rese

nce

in

hae

mat

olo

gy

and

gro

wth

d

iso

rde

rs

S

tron

g o

rga

nic

sale

s g

row

th

4


Secondary value

drivers




ZymoGenetics HRTHuman growth hormone

5

Diabetes careSales by year

DKK million

NovoRapid®/NovoLog®:

EU: Under roll out

US: Approved

Japan: Filed

New innovative devices:

Innovo®: EU and Japan

InnoLet®: EU

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

1995 1996 1997 1998 1999 2000

6

Insulin market overview(’99/ ’00 MAT Q3 volumes)

Novo NordiskMarket share

Market growth (‘00/’99)

44%

46%

4%

6%

% market size MAT Q3.00

100%

25%

58%

80%

61%

44%

Notes: Industrialised world only. Mail-order panel now included in the US figures. Market growth in Europe is affected by above +4% point from conversion of formulation in Italy and France. The effect on the world market growth is estimated to be approx. +2% point.

9.3%

10.5%

10.1%

15.8%

2.9%

World

RoW

Japan

Europe

USA

7

Insulin market growth forecast

Volume

5%

5%

10%

+ = Price/Mix Value• Population growth• Ageing population• Increased prevalence• Better diagnosis• More patients should use insulin• More intensive therapy is necessary

• More sofiticated insulin• More sofisticated delivery systems

8

ß-cell

- PGR - PCO- GLP-1.

Liver- Hepatic enzyme inh.- PPAR- Glukokinase - Glucagon antagonists

- Insulin- Insulin mimetics.

Muscle/Fat

- Insulin sensitisers- Insulin- Insulin mimetics- PPAR - GLUT4- TNF - PTPase.

Brain

- GLP-1.

Diabetes – a complex disease

Gut- GLP-1.

9

Diabetes – sources of innovation

R&D projects

Clinical research• Steno Diabetes Centre• Oxford Diabetes Centre• Clinical research centres worldwide

Evidence-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

10

Diabetes – evolution of a project

Identify & clone target

Establish biological function

High throughput screening

In vitro biological

profile

Chemistry

In vivo diabetes models

PLPc

Stable cell lines

Diabetesexpertice

Diabetesmodels

11

Diabetes pipeline

Phase 1Phase 1 Phase 2Phase 2 Phase 3Phase 3 RegistrationRegistration

NN2211 (GLP-1 analogue)

NN1215 (LABI)

NN1998 (AERx)

NN4201 (Hepatic glucose regulator)

NN304 (Basal analogue)

NovoMix® 30 (Premix analogue)

NN2344 (Insulin sensitiser)

NN414 (Insulin secretion)

NN622 (Dual acting sensitiser)

NovoMix® (other mixes) (Premix analogue)

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Secondary value

drivers





13

DKK million

Coagulation disordersNovoSeven® sales

Inhibitor indication:

Expected market potential

USD 350 million

Launched

EU: Feb 1996

USA: April 1999

Japan: May 20000

500

1,000

1,500

2,000

2,500

1996 1997 1998 1999 2000

14

NovoSeven® mechanism of action

(NovoSeven®)rFVIIa

Activation of platelets without NovoSeven®

Tissue factor - only at site of injury

FXa

Platelet activation

Thrombin activation and burst

Local activation of platelets & clot formation with NovoSeven®

The key impact of NovoSeven® is through injury site selective platelet activation to ensure high local thrombin formation which secures a tight fibrin clot

15

NovoSeven® update

Coagulation FactorDeficiency

PlateletDisorder

GeneralHaemostasis

Single Factor

MultipleFactors

Surgicalbleeding

Spontaneousbleeding

Lack ofplatelets

Defectiveplatelets

Haemophilia with inhibitors

Liver transplantationsUpper gastro intestinal bleeds

Liver resection

Intra-cerebral bleeds

Traumatology

Vitamin K-antagonists

Bone marrow transplantation

Liver resection

Hip replacements

Haemorrhagic dilution coagulopathy

Oozing after cardiac valve replacement

Colon cancer surgery

Glanzmann

Bernard-Souliers

Area of chronic liver disease

Upper gastro- intestinal

Current indication

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Financial results 2000

Net turnover 20,811 16,423 27

Operating profit as reported 4,816 3,527 37Operating profit adjusted*) 4,555 3,151 45

Financial items 24 -178 -Profit before tax 4,840 3,349 45Net profit 3,087 2,001 54

Earnings per share (DKK) 44.20 27.98 58 Earnings per ADS**) (USD) 2.76 1.74 58

*) Excluding Seroxat® licence income, one-off income in 2000 and Seroxat® licence income and restructuring costs in 1999.

**) Translated for convenience at the end 2000 exchange rate of USD 100 = DKK 802.05

DKK million 2000 1999 % change

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New long-term targets

Operating profit (EBIT) growth of 15% p.a.

Operating margin (EBIT-margin) of 25%

Return on invested capital (ROIC) of 25% p.a.

Cash to earnings ratio of 60%.

Notes: Cash to earnings target is based on a three-year rolling average for the cash flow.

18


Peak sales potential for current NovoSeven® indication = USD 350 million

Entering 8 new clinical areas with studies in 2001

Strategy for making NovoSeven® the first general haemostatic agent

Moving towards haemostasis management

Patent protection until 2007-11.


World leader with steady growth for 76 years

2/3 of business (insulin) growing >10% p.a.

Expansion strategy in the US

The most comprehensive insulin and insulin device portfolio in the industry – one new device per year

Sensitisers (NN2344 and NN622)

Liver programmes (NN4201)

NN2211 (GLP-1 analogue)

NN414 (insulin secretion).

Diabetes business

Secondary value

drivers



19

0%

20%

40%

60%

Astra

Zeneca

Eli Lill

y

Scher

ing-P

l.

Mer

ck

RocheBM

S

Aventis

Novo Nord

isk

No major patent expirations% of 1999 sales with patents expiring in 2000-2004

Source: Aros Securities Research and Novo Nordisk

20

Forward-looking statements

This conference call 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 risk and uncertainties that may cause actual results to differ materially from expectations, including unexpected developments in the international currency exchange and securities markets, government-mandated or market-driven price decreases for Novo Nordisk's products in the company's major markets and the introduction of competing products within Novo Nordisk's core businesses.

These and other risks and uncertainties are further described in reports filed with the US Securities and Exchange Commission (SEC) by Novo Nordisk and readily available to the public, including the company's Form 20-F, which was filed on 2 May 2000. A Form 20-F for 2000 will be filed by the end of June 2001.

21

Investor Relations Contacts:

Novo Nordisk A/S Investor Relations Novo Allé DK 2880 BagsværdDenmark

Fax (+45) 4444 2314.

Peter HaahrPhone (+45) 4442 1207 E-mail: [email protected]

Palle Holm Olesen Phone (+45) 4442 6175 E-mail: [email protected]

Rasmus Holm-JørgensenPhone (+1) 212 878 0123 E-mail: [email protected]

Share information

Novo Nordisk’s B shares are listed on the stock exchanges in Copenhagen and London. Its ADSs are listed on the New York Stock Exchange under the symbol "NVO". For further company information, visit Novo Nordisk on the World Wide Web at

http://www.novonordisk.com

Investor information

22

Appendix

23

Insulin etcSales by quarter

NovoRapid®/NovoLog®:

EU: Roll-out ongoing

US: Launch H2 2001

Japan: Filed

New innovative devices:

Innovo®: EU and Japan

InnoLet®: EU

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

DKK million

1997 1998 1999 2000

24

Human growth hormoneSales by quarter

Norditropin® SimpleXx™:

Launched

EU: April 1999

Japan: July 2000

USA: Oct 2000

DKK million

0

200

400

600

800


1997 1998 1999 2000

25

DKK million

Coagulation disorders (NovoSeven®)Sales by quarter

Inhibitor indication:

Expected market potential

USD 350 million

Launched

EU: Feb 1996

USA: April 1999

Japan: May 20000

200

400

600

800


1997 1998 1999 2000

26

Turnover by therapyDKK million 2000 1999 % of total % change

(2000)

Insulin etc 13,491 11,049 65 22NovoNorm™/Prandin® 1,087 728 5 49

Diabetes care, total 14,578 11,777 70 24

Coagulation disorders* 2,270 1,313 11 73Human growth hormone 2,107 1,721 10 22

HRT 1,306 1,130 6 16

Other 550 482 3 14

Total 20,811 16,423 100 27

* NovoSeven®

27

Turnover by geography

DKK million 2000 1999 % of total % change (2000)

Europe 9,905 8,286 47.6 20

Japan 4,385 3,404 21.1 29

USA 3,747 2,427 18.0 54

Rest of World 2,774 2,306 13.3 20

Total 20,811 16,423 100 27

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Tissue factorTissue factor RuptureRupture

NovoSeven® mechanism of action

FVIIa / NovoSevenFVIIa / NovoSeven®®FVIIa / NovoSevenFVIIa / NovoSeven®®

29

NovoSeven® studies in 2001

Clinical area Status on project

Orthotopic liver transplantations* Ongoing Ph 2/3 projectLiver resection (normal coagulation) Exploratory Ph 2 study has been initiated

Upper GI bleeds* Ph 2 study expected to start in first half 2001Liver resection* Ph 2 study expected to start in first half 2001Reversal of anti-coagulant therapy Ph 2 study expected to start in first half 2001Bone marrow transplantation Ph 2 study expected to start in first half 2001

Intra-cerebral bleeds Exploratory Ph 2 study expected to start by mid-2001

Traumatology Ph 2 study expected to start by year-end 2001

* Patients with chronic liver disease

30

Current issues

Settlement on two patents with Aventis

Share buy-back programme completed

Proposed dividend of DKK 13.25 per share (DKK 6.63 per ADS) ie an increase in payout ratio from 29% to 30%

Reduction in B share capital of nominal DKK 45 million (4,500,000 B shares) corresponding to 6% of the total capital

Split of shares (1:5): 1 B share (nom DKK 10) 5 B shares (nom DKK 2 each) 1 ADS (nom DKK 5) 2.5 ADSs (nom DKK 2 each)

31

Financial key figures

Gross margin 75.8 74.3 72.5

R&D to sales 16.3 16.7 20.5

S&D to sales 30.1 29.3 30.9

Adm to sales 9.0 10.5 10.2

Operating margin 23.1 21.5 21.5Operating margin adjusted*) 21.9 19.2 16.9

Return on invested capital 22.3 15.1 14.4Cash to earnings ratio 87.9 76.6 35.0

Per cent 2000 1999 1998

Definitions: ROIC: Operating profit after tax as a percentage of average stocks, debtors, tangible & intangible assets less non-interest bearing liabilities (provisions included and proposed dividends excluded).

Cash to earnings: Cash flow before financing (free cash flow) as a percentage of net profit.

32

Outlook for 2001 Growth in operating profit of 15% is expected

Including the impact of the settlement with Aventis

Net financial income is expected to be approx. DKK 300 million

Tax rate expected at 36%

Investments expected to be up to DKK 2.8 billion

Above outlook is based on the assumption that exchange rates remain at the current level (February 20 2001).

33

Vision for Novo Nordisk

• The world’s leading diabetes care company• Our aspiration is to defeat diabetes by finding better methods of diabetes prevention,

detection and treatment

• We will work actively to promote collaboration between all parties in the health care system in order to achieve our common goals

• Offer products and services in other areas where we can make a difference

• Our research will lead to the discovery of new, innovative products also outside diabetes. We will develop and market such products ourselves whenever we can do it as well as or better than others

• Competitive business results• Our focus is our strength

• We will stay independent and form alliances whenever they serve our business purpose and the cause we stand for

34

Insulin sales growth drivers 1:

Increased number of diabetics

Increase in the number of diabetics from 150 million to 220 million – 10 years from now – yearly growth of 3.9%.

Source: Amos A.., McCarty DJ, Zimmet P: Diabet. Med. 1997; 14

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Increased rate of diagnostics

Only about one third of diabetics are diagnosed

Increased rate of diagnosis leads to higher insulin sales.

50

150

0

25

50

75

100

125

150

175

# of diagnosed # of diabetics

36


More patients should use insulin

Number of diabetics using medication: 25-30 million

More patients should move to the use of insulin.

Oral products Oral/insulin Insulin

66% 7% 27%

37


More intensive therapy

The major land mark study, UKPDS*),prescribed:

Early intervention

Intensified therapy

Use products in combination

More patients on insulin.

*) UKPDS = UK Prospective Diabetes Study

38

Insulin sales growth drivers 5a:

Increased product sophisticationCartridge & Prefilled penetration in the insulin market (volume) by region MAT Q3.00

6.8%

49.7%

71.5%

81.1%

90.2%

0%

20%

40%

60%

80%

100%

Scandinavia Japan Europe RoW USA

Pot

entia

l

Scandinavia excl.

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Insulin sales growth drivers 5b:

Increased product sophisticationThe industry’s most comprehensive

insulin device portfolio

One new device to be introduced per year.

Conventionalsyringes

Insulin pens

Electronic insulin dosers

40

Insulin sales growth drivers 5c:

Increased product sophistication The industry’s most comprehensive portfolio of

insulin analogues

Rapid acting insulin analogue launched in EU, approved in US

Basal insulin analogue in phase 3

Premixed insulin analogue approved in EU

NVO LLY AVE

Rapid-acting Marketed Marketed Ph1/Ph2

Basal Ph3 Marketed

Premix, protracted Approved Marketed

41


More aggressive US strategy

400 new sales reps. hired / rented during 2000

Total number of reps. by end 2004 = up to 1,000

US insulin market size = USD 1 billion

Pen penetration = 6.8% (vol. MAT Q3 2000)

50% price premium on pen products

US market share (vol.) 20.1% in ’98, 20.2% in ’99 and 24.6% MAT Q3 2000.

Note: Market shares now include mail-order panels.

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