INSIDE

The future is in our hands COMOPs ready to meet challenges

From Russia with love Jostein Davidsen interview

A spirit to succeed Nycomed Belgium in profi le

ISSUE 13 Q2 2011

New focus for deal makers Business Development adapts to stay at the heart of the business

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This is Nycomed

Editorial

All products in italics are registered trademarks of the Nycomed group.

The NycomedMagazine is producedby CorporateCommunications andis intended for internaldistribution only.

FEEDBACK…is welcome, as are ideas for future issues.

Please e-mail megan.macrae@nycomed.com

Corporate Communications: Walter VaterlausPublisher: Birgit GronkowskiManaging Editor: Megan MacRaeEditor: Nick ReedDesign: Dave JohnsonContributors: Anna Artemeva, Martin Buschmann, Magali Coremans, Ward Geerts, Justin Hession, Lau Polinésio. Thanks to all Nycomed employees who have helped put this issue together.

Print: Burger Druck, D-WaldkirchPaper: Wood-free Profi silk silkmatt coated.

The contents of The Nycomed Magazine do not necessarily refl ect offi cial Nycomed views. Copyright for photographs and illustrations in The Nycomed Magazine are not always owned by Nycomed.

Megan MacRae

Much of its success points to a hugely engaged leader who embodies a wonderful combination of business savvy and great love for the country, its people and way of life. A Norwegian converted forever.

Our products, however – and our commitment to quality – know no borders. TachoSil is spanning continents as you’ll see in the Product Profi le. Our Operational Excellence programme, or OpEx – as the folks in Operations like to call it, is running full throttle. You’ll read fi rst-hand from ‘Black Belt’ Gesche Ahrens about the things she and her team are doing to improve processes and increase output.

And our Daxas cross registration team is moving mountains to clear this most important fi rst hurdle in getting our COPD medicine to patients worldwide.

You’ll see we have attached a small booklet at the back of the magazine. It’s called ‘This is Nycomed’. It will come in handy when telling the Nycomed story. It outlines in simple terms our vision, mission, strategy and key strategic pillars. It’s easy to fl ip through and refer to for reference and inspiration.

I’ve only touched on a few of the topics covered in this issue. There’s plenty more awaiting you, such as meeting our Business Development team, a Hot Seat interview with our Head of Operations and some interesting results just in on our Values Survey – results that show we’ve got a motivated global team ready to make our strategy happen.

Enjoy the issue!

When we talk about strategy we often say we can’t have Europe without emerging markets, and vice versa, if Nycomed is to expand. This issue backs that claim.

In the Business Update, you’ll get a sense for how it all comes together: the importance of expanding our presence in growth markets and the importance of keeping up a strong, unifi ed – and profi table – Europe. Head of COMOPs Guido Oelkers talks about what we need to do in order to stay on course. He gives examples of how we are putting our emerging markets expansion strategy to work. He also cites the ‘ONE Nycomed in Europe’ (ONE) initiative as an example of how we are readjusting the lens to take a broader European view when it comes to some of the larger strategic decisions we need to make. It’s a push to look beyond local country borders for the benefi t of Nycomed as a whole.

While we’re on the subject of Europe, check out the Belgium profi le with Country Manager Chris Juliam. In the face of all sorts of challenges, Chris and her team just keep on posting solid results. No wonder: their rally cry is to ‘always out-perform the market’ – a cry that will now carry over to the new ‘FraBeNe’ cluster she’s leading as part of the One approach.

And then there’s the recent deal signing with Colombia-based Farmacol – the latest strategic move in our emerging markets growth strategy. As Norbert Oppitz, our Head of the Latin America region, says –if you want to be a player in Latin America, youneed to establish a foothold in Colombia. And that’swhat we’ve done.

One of our brightest stars on the emerging markets horizon is Russia/CIS. After reading the Profi le with Jostein Davidsen, Head of Russia/CIS, you’ll understand a bit better why this LOC keeps on shining bright.

The Nycomed Magazine is a publication for Nycomed employees around the world.

ISSUE 13 Q2 2011

Nycomed International Management GmbHThurgauerstrasse 1308152 Glattpark-Opfi kon (Zurich)Switzerland

www.nycomed.com

© Nycomed 2011

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This is Nycomed

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•THIRTYNINE

New Brand Portal helps coherent communication

What we are all about

New offi ce paves way for ‘Quantum Leap’ in Saudi ArabiaNycomed Saudi Arabia has paved the way for its next stage of expansion by moving to a new offi ce in the port city of Jeddah.

The company, which contributes 22% of all Nycomed sales in the Middle East North Africa (MENA) region, has plans to increase turnover from its current level of €17.7 million to €70 million by 2015.

It aims to do so by launching new medicines such as Daxas and Omnaris, forging in-licensing partnerships and improving market access.

“To be ready for this ‘Quantum Leap’ development we need a suitable working environment for our offi ce-based staff of 30 people,” says Country Manager Ahdy Abdul Salam El Sayes. “Our new offi ces in Jeddah fi t the bill perfectly in that regard.”

This little booklet serves as a strategic compass. It holds in its tiny frame statements that back up our strategy. Combined, they tell the Nycomed story. What we are about, where we are going and how we plan to get there.

It includes the fi ve ‘pillar’ statements that support our strategic direction, like what we mean when we say we have ‘strength in dynamic markets’, or that we provide ‘medicines that matter’ or we’ve entered ‘a new phase of growth’.

The booklet is available online, along with the new ‘This is Nycomed’ poster. You can fi nd them on iNside, under ‘About us > Our Strategy’. There’s also an interactive version that includes more details – or proof-points – that further support our strategic positioning.

in their behaviour, our story and what we stand for becomes a clear differentiator in a competitive industry,” Dagmar explains.

The portal features the Nycomed Brand Story – who we are and what we stand for – including our brand essence – ‘Everything we do matters to somebody.’ It gives Visual Identity guidance in terms of how to use the Nycomed logo, colours, fonts, design elements and photography style. It also includes our company glossary and writing style guide.

There’s a download area with a range of print and electronic media templates, and a ‘Services’ section that includes news and contact details for the Branding Hotline.

“When we use the guidelines consistently on a global level, our values and what we stand for come through loud and clear.”

The Nycomed Brand Portal can be accessed through the intranet iNside – no password is needed. Agencies can also access it after registration at www.nycomed.com/brandportal/

Settling inNycomed Saudi Arabia Professional Sales Representatives Sherif Nabil (left) and Ahmed Fahmy in the reception of the company’s new offi ce.

It’s not often you fi nd something that makes life easier for employees AND saves the company money. But that’s exactly what Nycomed’s new Brand Portal manages to achieve.

The portal, launched in March, provides a one stop shop on ‘all things brand’ – from the colours and images we choose to the language we use. It provides a variety of templates, applications and a branding hotline. And even working with agencies is easier because they can have external access.

“One of Corporate Communications’ main objectives is to ensure a globally coherent image of Nycomed. To do this in a cost effi cient way, we provide tools, templates and services for everyone that are ready-to-use. One of these is the newly developed Brand Portal,” explains Dagmar Lüdtke, Nycomed’s Brand Manager.

The Nycomed brand is much more than a unique visual identity. It infl uences all Nycomed stakeholders on both emotional and intellectual levels. The Brand Portal helps distinguish the company in terms of messaging and appearance, and supports the company’s business strategy.

“When every Nycomed employee consistently presents the company not only visually and in the written word, but also

This is Nycomed

IN BRIEF

Contents

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4 Remaining CompetitiveThe future is in our handsThe ongoing transformation of COMOPs is helping Nycomed maximise opportunities and meet new business challenges.

Business UpdatePoised for growth in Latin AmericaThe acquisition of Farmacol in Colombia helps regional consolidation.

Business UpdateTachoSil milestones reachedUS launch continues globalisation, as sales pass €100 million mark.

Profi leFrom Russia with loveJostein Davidsen refl ects on two eventful decades orchestrating Nycomed’s operations in Russia/CIS.

Teamwork drives Daxas registrations How a cross-functional effort is keeping the global process of submissions and approvals for the COPD medicine on track.

Meet the TeamNew focus for deal makers A functional reorganisation keeps Business Development at the heart of the business.

Country Feature BelgiumA spirit to succeedEntrepreneurialism and creativity have helped Nycomed Belgium meet a number of signifi cant challenges.

A Day in the LifeNew ways of thinking, new ways of working Singen OpEx Black Belt, Gesche Ahrens, explains how she is inspired by the opportunity to add value.

Product Profi leNature’s bodyguard An in-depth look at Ulinastatin, Techpool’s infl ammatory agent to treat sepsis and acute pancreatitis.

Hot Seat Barthold PieningOperations adapting to new challenges How does the strategic focus on emerging markets impact our production and distribution strategy?

Getting the measure of Nycomed’s culture One-third of the company’s employees took part in the recent Values and Culture survey. How do they rate Nycomed as a place to work?

Partner in Focus Zydus Cadila‘A meeting of minds’…brought Nycomed and its Indian partner together 12 years ago, and common goals are behind their continued collaboration.

In briefThis is NycomedA look at the company’s new Brand Portal, new offi ces open in Saudi Arabia, and a ‘This is Nycomed’ booklet for you to keep.

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The future is in our hands

FOUR•REMAINING COMPETITIVE•COMOPS

CONTINUED ON PAGE SIX

The rapidly evolving global environment is making it increasingly complex for pharmaceutical companies to remain competitive. But the ongoing

transformation of our Commercial Operations (COMOPs) function is set to help the company maximise opportunities and meet new business challenges.

Growing pressure from healthcare authorities on pricing and reimbursement, intensifi ed generic competition, escalating operating costs … has life ever been tougher for the pharmaceutical industry?

Nycomed has an additional challenge to contend with: while Pantoprazole sales stabilised towards the end of 2010, there is still a gap that needs bridging between the erosion that has inevitably resulted from the product’s loss of exclusivity and the arrival of meaningful revenue from Daxas.

One person’s challenges, however, are another’s opportunities. Guido Oelkers, the company’s head of COMOPs, is determined to see that our commercial operations are properly structured to meet the needs of various stakeholders so that we remain competitive and can achieve our long-term objectives. That is the thinking behind a series of initiatives detailed in the following pages.

Guido is certainly in the ‘glass half full’ not ‘glass half empty’ camp when it comes to business thinking, even if his drink is spiked with a healthy shot of realism. “This company has plenty of tremendous opportunities for future growth, particularly with Daxas and in emerging markets. “We are actually one of the few companies that has a product in the launch phase that makes a real difference,” he says. “And our specialty portfolio is also enjoying double digit growth. But we can’t do everything. We have to prioritise the investment of resources in the areas where they best support our strategic aspirations, and retool the organisation accordingly. So getting Daxas right and continuing to strengthen our presence in emerging markets must be our two areas of principal focus.

“In particular we need to be targeting profi table and sustainable growth, rather than just sales,” he adds. “And our local organisations must move from a mindset of ‘market management’, where they are primarily concerned about optimising brands in their local geographies, to one of ‘business management’, where they take decisions based on what is best to sustainably grow cash fl ows.”

As Guido explains, the difference between the respective environments of the new, emerging markets and those that are more mature couldn’t be more marked. “In the former you have dynamic growth, in the latter it is very limited - if not virtual stagnation.” he says. The focus in emerging markets, which now accounts for 39% of our net turnover, has been on investment and the creation of

new local operations in countries such as South Korea, Indonesia and Colombia, the reinforcement of our presence in MENA, including new LOCs in Turkey and Saudi Arabia, and a major acquisition in China with Techpool Bio-Pharma. In Europe and Canada, meanwhile, it’s all about building sustainable positions and staying profi table in an environment characterised by cost containment.

Profi tability will be driven by making Daxas a success, optimising our portfolio and repositioning underperforming brands, while keeping a constant eye on the cost base. Europe has already taken a major step forward in this respect with the adoption of its ONE – ‘One Nycomed in Europe’ – strategy, which is based on six clusters as major performance ‘cells’ and a new governance structure in the form of a European Leadership Team (see panel on page 7). “Managing Europe as one entity will give us more coherence, help us prioritise better and fi nd solutions that help us generate the kind of sustainable profi tability we want,” Guido says.

REMAININGREMAININGCOMPETITIVECOMPETITIVE

“We can’t do everything. We have to prioritise the investment of resources in the areas where they best support our strategic aspirations.”

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•FIVE

CONTINUED FROM PAGE FIVE

Refocusing of OTCThe strong growth potential in emerging markets and stagnation in most of Europe is also behind changes at Nycomed’s OTC organisation, which aim to help the function better serve emerging markets while focusing on selected countries in Europe where our position is suffi ciently strong. “We will not reach the necessary critical mass in OTC in each market,” Guido says. “With an emphasis on emerging markets and selected clusters in Europe, we are repositioning this business to concentrate on countries with the best growth opportunities for Nycomed.”

The central OTC team will now focus on global strategy and new product development initiatives in defi ned categories and geographies.

Brand Management consolidation Brand Management has been consolidated into two product-based teams, moving away from the lifecycle management approach. The Global Osteoporosis and SBS (short bowel syndrome) management team will handle Preotact, Circadin, Calcium, Steovess, and Revestive(teduglutide), while the Global Tissue and Pain Management will support Xefo, Matrifen, Instanyl and TachoSil.

Business Management and Commercial Effectiveness join forces The Business Management and Commercial Effectiveness groups now form one team, working with regional heads, country managers and corporate stakeholders such as the SBUs to drive profi t generation and sharing of best practice across the company. While the LOCs and Area Management remain responsible to drive sales and profi ts, Business Management will support them in a practical and measurable way, covering all aspects of Business Management, including Commercial, Marketing and Channel Excellence and Performance Measurement.

The Max 2010 commercial performance project has successfully achieved its objectives. The productivity improvements and savings have been incorporated into the LOC’s 2011 budgets, and activities developed under the initiative, such as Marketing Mix optimisation and Pharmacy Excellence, are now being implemented. Commercial Effectiveness is now to become a permanent way of thinking and operating to build the overall competitiveness our set up.

PIM gives direction to the business Portfolio and Interface Management (PIM) provides data and strategic analysis to advise the business on how to make our product portfolio fi t for the future and get the geographical focus right. It is also the interface for R&D, Business Development, Finance and other key functions for business cases of prelaunch products up to phase II, in-licensing, and mergers and acquisitions.

“These moves create two clearly defi ned support functions,” says Guido. “PIM now has a more long-term oriented portfolio and project orientation, while Business Management will focus on our current portfolios in the LOCs and how to get the very best out of them.”

Post-launch pricing As well as keeping a sharp focus on driving the successful roll-out of Daxas, the International Pricing and Market Access team will also take on post-launch price management, in addition to the pre-launch focus already in place. This will allow them to address pricing-related questions more effi ciently for products already marketed, and provide the information needed for discussions around potential price cuts.

“The opportunities presented by Daxasand other key products, allied to the growth potential in emerging markets and our strength in Europe, give us the platform for an exciting future,” Guido concludes. “Determining just how exciting this is, however, lies in our own hands. We need to grow, deliver on our targets, simplify and prioritise if we are to achieve our goals. These changes to our commercial operations will help us do exactly that.”

REMAININGCOMPETITIVECOMPETITIVE

“We need to grow, deliver on our targets, simplify and prioritise if we are to achieveour goals.”

SIX•REMAINING COMPETITIVE•COMOPS

Lothar Boesch (left) and Timo Tiivola (right)

While emerging markets will fuel Nycomed’s growth in the immediate future at least, Europe, together with Canada, still contributes half of the company’s sales and profi ts. It therefore remains the backbone of our business.

The new ONE (‘One Nycomed in Europe’) strategy is designed to ensure that, while top line growth opportunities in the region may be increasingly challenged by healthcare cost containment, the European organisation is successfully managed to achieve sustained profi tability.

ONE is based on six country clusters operating as major performance cells, and a new European Leadership Team (ELT), comprised of the area and cluster heads. As a mature market with many similarities to Europe, Canada is also included in the new set up.

European Leadership Team (ELT)Ghita AstrupNordics, UK & Ireland

Lothar BoeschCentral, South & Eastern EuropeDACH (Germany, Austria, Switzerland)

Pier ColliGR-IT (Greece, Italy)

Chris JuliamFraBeNe (France, Belgium, Netherlands)

Frank RotmannCEE (Central & Eastern Europe)

Timo TiivolaWestern Europe, Canada, MENA & South Africa

Lide VerdugoIberia (Spain, Portugal)

ELT’s primary focus is to maximise profi tability on a European level by optimising investment decisions and business opportunities across countries. This will allow a number of key decisions to be taken from the vantage point of a broader European perspective versus on an individual country basis.

“This new approach will lead to synergies and economies of scale, but most importantly it ensures that investment goes where it will generate maximum profi tability. There will be a permanent and close alignment between the ELT, the regions, the clusters, and the local operating companies,” explains Lothar Boesch, Head of Central, South & Eastern Europe. “We need to avoid a silo mentality if we want Europe as a whole to be profi table.”

“Country Managers will, of course, remain fully responsible for the profi tability of his or her

Shared accountability for an integrated Europe

country, maximising the potential of our EU portfolio while tightly managing their cost base. The ELT will have overall accountability for P&L (profi t and loss) in Europe and

Canada – or EUCAN – which will enable us to be fast and fl exible in our decision making, based on the priorities of the region as a whole,” says Timo Tiivola, Head of Western Europe, Canada, MENA & South Africa.

Entrepreneurship in the LOC (local operating company) teams will be crucial to identify business cases for growth initiatives with a European as well as local scope. And they will also have a key role to play in supporting the evaluation of managing non-core brands for profi tability.

“The role of the LOC is shifting from country to business management,” Lothar says. “It’s a two-way process. We certainly need their contribution to the overall European business, and we are sure they will benefi t from good ideas initiated in other parts of the region that could be replicated in their own territory.”

‘ONE Nycomed in Europe’

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•SEVEN

BUSINESS UPDATE

Andean ‘cluster’ that includes Venezuela, Ecuador, Peru and Columbia. Nycomed products in Ecuador and Peru are currently handled by local partners.

“The acquisition of Farmacol gives us access to one of the fastest growing pharmaceutical markets in Latin America, as well as some very interesting brands,” Norbert says. “It also helps us consolidate regionally. With the creation of the Andean cluster, we are now adopting the Co-ordinating Country Concept model, which will transition us from a host of isolated countries to one unifi ed regional player comprising Mexico, Argentina and the new cluster.”

According to Norbert, the Farmacol deal is a ‘small transaction’ – but one that is highly strategic.

“I see this latest deal as evolutionary, not revolutionary. It gives us an excellent base, making us even more attractive to licensing partners as we continue to grow our presence here. I’ve always said that we want to be the preferred marketing and sales partner for every company seeking to license a product in Latin America. I want to see them lining up outside our door, and this transaction, in addition to the turnarounds we’ve completed in Mexico, Argentina and Venezuela, should help make that a reality.”

Founded in 1969 and based in the Colombian capital, Bogota, Farmacol has always been a family run and family-owned business, with a similar culture to Nycomed’s. It currently employs about 70 people who are passionate about delivering quality products that make a difference.

The company has a strong portfolio of branded medicines in the areas of gastroenterology, respiratory and gynaecology, as well as international-standard production facilities that manufacture liquids, solids, semi-solids and effervescent products. Its leading products include the anti-spasmodic Espasmobil and varicose veins treatment Vasoton.

Nycomed aims to not only launch products such as Omnaris and Daxas in the country, as well as regional brands such as Alevian Duo, Dagla and Tecta, but also to analyse the potential of introducing Farmacol products to other parts of the Andean region.

“Colombia is a very competitive market, but also very exciting,” Michael Himmel says. “As with the rest of Latin America, we are anticipating a lot of launches in a very short period of time, but that is a challenge we are all really looking forward to.”

Poised for growth in Latin America

“If you want to be a major playerin Latin America, you have to be in Colombia.” It’s a simple strategic imperative voiced by Norbert Oppitz, the head of Nycomed’s Latin American organisation, when explaining a recent deal signed to acquire the country’s tenth largest pharmaceutical company, Laboratorios Farmacol S.A. (Farmacol). But it’s one that is backed by hard facts.

Colombia is Latin America’s fi fth largest pharmaceutical market, with annual growth of 14%. It is recognised as one of the region’s most dynamic economies, with great potential. And it is currently investing heavily in industrialisation, education and infrastructure.

Latin America is dominated by two big markets – Brazil (a separate Nycomed region in its own right) and Mexico – as well as three mid-sized markets – Argentina, Colombia and Venezuela. Colombia is the only one in which Nycomed has previously had no direct presence.

The new Colombian company will become a fully-fl edged Nycomed entity headed by Michael Himmel, formerly Commercial Director for the region and someone who, like Norbert, has lived and worked in Latin America for the past decade. Michael will also lead a new

Nycomed’s recent signing of a deal to acquire Laboratorios Farmacol S.A. in Colombia is an important milestone in our growth strategy for Latin America.

“The Farmacol acquisition gives us access to one of the fastest growing pharmaceutical markets in Latin America, and helps us consolidate regionally.”

Platform for growth The head of Nycomed’s Latin American organisation, Norbert Oppitz (left), discusses business strategy with Michael Himmel, head of the new Andean cluster.

EIGHT•BUSINESS UPDATE•COLOMBIA DEAL

Helping nature take its course

TachoSilTachoSil is the third generation in a dynasty of haemostatic patches after TachoComb and and TachoComb H.

It is a ready-to-use patch that can be applied directly to a bleeding area either wet or dry. When it comes into contact with blood or

other body fl uids such as uids such as lymph or physiological saline solution, the fifi brinogen and thrombin dissolve and partly diffuse into the wound’s surface.

This leads to a reaction between the two between the two coagulants that initiates coagulants that initiates the fithe fi nal phase of the nal phase of the

body’s natural blood body’s natural blood clotting process: the clotting process: the thrombin converts the thrombin converts the fifi brinogen into a fi brinogen into a fi brin brin clot that sticks TachoSilto the tissue surface and achieves haemostasis (control of bleeding).

The patch is absorbed by the body within weeks.

Dr Yoshiya Toyoda, head of cardiothoracic transplantation at the University of Pittsburgh Medical Center, has used it in heart transplant operations. And Dr Michael Reardon, a cardiac surgeon at the Methodist DeBakey Heart and Vascular Center in Houston, Texas, is one of many opinion leaders who have reported a positive clinical experience.

“My team and I have used TachoSilin combination with sutures to control bleeding in complex cases of cardiovascular surgery,” he explains.

“In cardiovascular surgery, particularly complex surgery, surgeons may face many different and diffi cult types of bleed-control challenges. The ability to use sutures plus an adjunctive haemostatic agent such as TachoSiloffers a new approach that gives us both fl exibility and confi dence to control bleeding during these situations.”

The approval and subsequent commercialisation of TachoSil has been a welcome addition to Baxter’s BioSurgery product portfolio, which provides a range of adjunctive haemostasis and sealing options to cardiovascular surgeons depending on the surgical situation and need. Dr Mauricio Ede, Medical Director for Baxter’s Regenerative Medicine

business, comments: “The ready-to-use TachoSil patch offers a new and different option in the armamentarium of adjunctive haemostasis products used in cardiovascular surgery in the US.”

Martin Sigl, Senior International Brand Manager within SBU Specialty Products and OTC, adds: “At the moment we only have approval for cardiovascular surgery in the US, but we are currently conducting trials with a view to applying for the use of TachoSil in general haemostasis indications. This would open the market up signifi cantly, and the clinical experience of surgeons so far will clearly support our application.”

TachoSil is now available in more than 40 countries worldwide, and sales topped €100 million at the beginning of December 2010. By the end of the year, this fi gure rose to €108 million.

POTENTIAL“The extraordinary thing about TachoSil is that it still has enormous growth potential, even though it has been around for 18 years if you take its predecessor TachoComb into account as well,” says Jörgen Persson, Senior Director, SBU Specialty Products. “We anticipate double digit growth up to 2015 at least, not only in existing countries and segments, but also from new segments and through geographical expansion.

“These really are exciting times for TachoSil.”

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•NINE

TachoSil milestones reached

TachoSil has passed two important milestones on its journey into a global brand. In September 2010 Nycomed’s haemostatic surgical patch was launched in the US, the world’s largest pharmaceutical market, by the company’s exclusive marketing and distribution partner, Baxter International Inc. And the year ended with sales having broken through the magical €100 million barrier for the fi rst time.

2011 promises to be equally eventful. Not only will efforts continue to ensure the right focus in existing European markets, but business cases for TachoSilare currently being evaluated in several key emerging markets. There are also a number of projects under way, focusing on line extensions and further indications.

TachoSil, which combines a collagen patch with a coating of the human coagulation factors fi brinogen and thrombin, is the fi rst and only adjunctive haemostatic agent available in the US. Following 18 months of intensive pre-marketing activity, which included the establishment of advisory boards and a Centre of Excellence involving some of the country’s leading surgeons, around 130 Baxter sales reps are now detailing it to more than 60 hospitals. It is currently used in cardiovascular surgery.

The US launch of Nycomed’s haemostatic surgical patch marks an important stage in the product’s globalisation, while sales hit an all-time high.

“TachoSil offers a new approach that gives us both fl exibility and confi dence to control bleeding.”

TACHOSIL•US LAUNCH/SALES MILESTONE

TEN•PROFILE•JOSTEIN DAVIDSEN

CONTINUED ON PAGE THIRTEEN

From Russia with loveNycomed’s spectacular growth in Russia/CIS is one of the company’s greatest success stories, and it has been orchestrated for more than two decades by the same man – Jostein Davidsen. As he admits, however, he hasn’t always been the country’s biggest fan.

Jostein Davidsen readily acknowledges that Nycomed’s outstanding success in Russia/CIS over the past decade or so owes much to the company’s knack for being in the right place at the right time. He is fully aware of the irony, therefore, when admitting that his fi rst experience of the region left him with a distinct sense of being in rather the wrong place at the wrong time.

That was in January1988. Jostein was one of a handful of enthusiastic young Norwegians that had been taken on by Nycomed a couple of months earlier as international trainees to drive the expansion of what was then an Oslo-based company involved principally in diagnostic imaging. He had been allocated responsibility for the Soviet Union and Eastern Europe.

“You’re either touched by Russia/CIS or you’re not… there’s always an adventure to be had somewhere, and there’s nothing I like more than an adventure.”

“I felt a bit unlucky to be honest, and my fi rst trip to Moscow did nothing to change that opinion,” he says. “It was dark, damp and cold – minus 30°. There were no lights, no advertisements, no restaurants, no bars and very little traffi c. I couldn’t wait to leave.”

How times change. A decidedly happier Jostein has spent 16 of the subsequent 23 years living in the city that made such a bad fi rst impression, falling in love with the entire region and its people in the process. Having weathered a rollercoaster fi rst ten years at the helm, he now heads a company that employs 1,400 people across the region as a whole and, with sustained annual growth of 20%, is on course to achieve sales of €1 billion by 2014. Perhaps most importantly for him, he also now has extremely personal ties.

“Russia has been very good to me,” the 51-year-old says. “It has given me my beautiful wife, Irina, and two gorgeous kids – Michael, who is three, and Anastasia, who is just eight months old – as well as a hugely exciting professional life.

“You’re either touched by Russia/CIS or you’re not,” he explains. “For me it’s like a drug – it’s addictive. It’s the sheer size of the place, for a start – there’s always an adventure to be had somewhere, and there’s nothing I like more than an adventure. It’s a rich and vibrant region and there is something emotional, almost spiritual, that keeps you here. The people are really warm and hospitable. And it’s a place where everything is possible and everything is impossible. All you can do is trust yourself, and that is a really stimulating way to live.

“There have been plenty of tough times, especially in the 1990s when there was a lot of corruption and lawlessness and the business world was a jungle. Still, it’s an incredibly dynamic part of the world from a commercial point of view and the rapid pace of change provides a whole host of challenges and opportunities. Of course there is still a lot of bureaucracy, but I can’t think of anywhere on earth that is more exciting than Russia at the moment in terms of energy, drive and growth prospects.”

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•ELEVEN

“I still have a lot of energy and drive, and there are lots of things I still want to achieve here – not least to see the completion of our new state of the art factory at Yaroslavl.”

Unbridled enthusiasmJostein Davidsen strongly believes that Nycomed’s new plant at Yaroslavl, plans for which were viewed by Russian Prime Minister, Vladimir Putin, last year, demonstrate the company’s commitment to the future of Russia and its people.

TWELVE•PROFILE•JOSTEIN DAVIDSEN

Jostein’s unbridled enthusiasm today contrasts starkly with his mood in 1988. Born and brought up on the small island of Askoy, near Norway’s second biggest city, Bergen, he had spent four years studying at the Oslo School of Business and Administration, as well as two years working for the Norwegian Trade Council in Dusseldorf, Germany, before taking up his traineeship with Nycomed.

“I was always focused on an international career and, for young Norwegians, Nycomed was the place to be at the time,” he says. “At fi rst I was based in Vienna, so my initial disillusionment with Moscow wasn’t really a major problem. I began warming to the city when I spent virtually the whole summer of 1991 there to negotiate a major contract for Nycomed to become a state partner. Fortunately for us, that was signed just a month before the collapse of the Soviet Union, and the state banks covered the deal.”

It was the fi rst example of ‘right place, right time’ for the company, which grew rapidly thanks to clever investment decisions and rapid expansion into the newly established CIS (Commonwealth of Independent States). Jostein moved permanently to Moscow in 1994, only for disaster to strike four years later when the Russian economy collapsed.

“The rouble was devalued by 350%, the country entered a severe depression, and our sales virtually disappeared,” he recalls. “I seriously considered asking to move, but in my stomach I knew the problems would be short term and I wanted to stay and fi ght for what I believed in. Head Offi ce was asking why we weren’t pulling out, like all the other multinational pharmas, but I’d spent ten years building the company from scratch and I begged them for a chance to turn it around.

“I have never defended a company more. I presented a restructuring strategy that involved putting together a new portfolio, signifi cantly reducing the number of employees, cutting salaries and moving to a new offi ce and warehouse. I guaranteed we

would break even by the end of 1999 and was told by the Nycomed board to ‘prove it or lose it’. Given our subsequent growth and current sales forecast, it has to be one of the best investment decisions they have ever made.”

Needless to say, Jostein delivered on his promise. Nycomed Russia/CIS not only broke even on schedule, but also returned to growth within 18 months. It was fairly modest at fi rst, but started accelerating to more spectacular levels around 2002: not only did rising oil prices provide a boost to local economies, but Nycomed also took advantage of other companies’ absence in the region to sign an exclusive agreement with Merck Germany for a range of branded generics. “These were worth around DM3 million when we took them over, but they now represent a €150 million business – 30% of our total turnover,” Jostein says.

“Today 50% of our sales in Russia/CIS comes from partner products, and we now have ten different partnerships that have been established over the past decade. Our proven track record has established Nycomed as a strong partner in the region, and this will be vital to our future growth.”

New products will also play a vital role, of course. Nycomed Russia/CIS started selling Pantoprazole this year and is ‘cautiously optimistic’, according to Jostein, about the prospects for Daxas, which is due to be registered during the fi rst half of 2011. “Life expectancy for people in this region is quite low, so COPD has never really been a priority,” he explains. “That’s changing, though. Around 40% smoke, and it is placing an increasing burden on healthcare budgets.

“It’s estimated that 17% of all deaths here are caused by smoking. That’s 400,000 people a year, so the potential is huge for us to help people suffering from respiratory illness. The positive impact on Nycomed’s reputation in the region would be enormous.”

IN THE BLOODThe passion with which Jostein talks about his adopted home and the business he’s built begs an obvious question: is Russia/CIS now in his blood, and could he ever leave for pastures new? “It’s a joke among friends and colleagues,” he admits. “I keep saying ‘two or three years more’ – the trouble is, I’ve been saying it ever since I arrived.

“I miss the mountains and the clean air of Norway. I’m an outdoors man at heart, someone who likes hiking, fi shing and cross-country skiing, so maybe one day I’ll move. But I still have a lot of energy and drive, and there are plenty of things I still want to achieve here – not least to see the completion of our new state of the art factory at Yaroslavl.

“One thing’s for sure, though. Wherever my life takes me in the future, a very big part of my heart will always belong to Russia/CIS.”

CONTINUED FROM PAGE ELEVEN

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•THIRTEEN

As the registration of Daxas with regulatory authorities continues worldwide, we look at the successful cross-functional team effort that is driving the process.

“On course and according to plan.” That’s the assessment of Senior Regulatory Affairs Manager, Christoph Bunte, when asked how the global process of submissions and approvals for Daxas is going.

As this issue of the Nycomed Magazine went to press, Nycomed’s new COPD drug has been approved in 34 countries, including 27 in the EU and most recently in the US, where the product will be called Dalisrep. Marketing authorisation procedures are under way in a further 21 markets, and further submissions are planned in some 50 more.

“Some countries have moved quicker than we expected – Ukraine and Brazil being the obvious examples – while others are moving more slowly, often because of challenging questions or requests from the regulatory authorities during review,” Christoph says.

MAJOR CHALLENGEThese different questions or requests represent a major challenge for Christoph and his Daxas Registration Team, as the Regulatory sub-team is called, and which he co-chairs together with Eva Ammon, Director, DaxasProject Management. ”The cross-functional nature of the registration process is a critical success factor because of these challenges – not only between corporate functions, but also between Headquarters and the local operating companies (LOCs),” he says.

The collaboration starts with the preparation of a regulatory dossier itself.

Typically this will be 80% the same as the European dossier, and 20% tailored to local requirements in each country. Most R&D functions will work with Regulatory Affairs to deliver quality and analytics, preclinical as well as clinical information, while the LOCs will be heavily involved to ensure the fi nal documents meet local requirements and are submitted to their local authorities in the required time frames.

“We will provide a CoPP (Certifi cate of a Pharmaceutical Product) if required. This is issued by the European Medicines Agency (EMA) based on the approval of Daxas,” Christoph explains. “The patient information leafl et and the prescriber information are usually prepared locally – with our support, and based on existing corporate documents. Larger markets typically do their own assessments of

clinical data, while smaller authorities usually follow the decision of leading regulatory authorities such as EMA in the EU or the Food and Drug Administration (FDA) in the US.

“Sometimes there are local requirements that need specifi c input. For example, some countries such as Mexico, Korea and Taiwan ask for local clinical data. In these cases, a specifi c expert report is written by several R&D functions, demonstrating that the drug’s effi cacy and safety in the local population is comparable to the results in the overall study population of our major global clinical studies.”

The Nycomed cross-functional collaboration continues after the dossier has actually been submitted. LOCs often get asked by their authorities to supply drug samples, specifi c legal documents and other information – one even asked for facility plans of the manufacturing sites involved. Frequently, the LOCs will also come back to Regulatory Affairs with specifi c questions that have been raised by their regulators during review: since most authorities have no fi xed schedule, these can crop up at any time.

In each case the questions are passed on to those corporate functions that have the best knowledge about these particular issues, with their written answers then fed back to the individual markets via Regulatory Affairs. The responses to authority questions pose the main burden for the corporate team, since there are usually tough timelines for the feedback to authorities.

Teamwork keeps Daxasregistrations on course

“Everyone knows what they are supposed to be doing” Eva Ammon.

FOURTEEN•DAXAS REGISTRATION UPDATE

“Some authorities insist on inspecting manufacturing sites as part of the registration process – offi cials from Turkey went to our fi nished product site at Oranienburg, for example, while inspectors from the FDA visited one of our providers involved in drug substance manufacturing,” Eva says. “This obviously brings our colleagues in Operations and Quality Assurance into the collaborativeprocess.

“Other authorities can request meetings with the company to discuss the submission, which often means we have to invite various corporate experts and senior managers. At a meeting with the Australian authority TGA last October, for example, there were Nycomed representatives from Drug Safety, Clinical, Clinical Pharmacology and Regulatory Affairs all present, as well as Anders Ullman, the head of R&D.”

Many regulatory processes run in parallel with busy periods for the team, of course – LOCs may be launching other products, for example, while the corporatefunctions need to juggle the demands of Daxas with their numerous other activities. The general rule is that there is never a dull moment: even weekends or the period between Christmas and New Year can be busy, depending on questions and deadlines to respond.

“The only way we can manage all this is through a truly cross-functional teameffort,” Christoph says. “Fortunately, the whole of Nycomed is supporting the Daxas registration and launch. This

makes the process a lot smoother, and gives us the flexibility to react faster.

“As co-chairs of the Daxas Registration Team, Eva and I work closely together toorganise the team and keep everybody informed on a daily basis. At the corporate level, we had three meetings a week during the European registration process. And we still meet once a week to make sure we are aligned. We have also worked closely with our US partner, Forest, which has been responsible for driving the successful US regulatoryprocess and which we supported strongly since the beginning of our collaboration in August 2009.”

Eva adds: “Most of us working in the Daxas Registration Team were involved in the preparation of our dossiers for the EU and US, so we know each other pretty well. Everyone knows what they are supposed to be doing and is committed to being fl exible tosupport one another. Most of us are based in Constance too, so there’s a lot of informal interaction that helps us toaddress issues quickly.

“It’s a fully empowered team, too. Weare obviously linked closely with the Daxas Global Launch Team, but unlike in other companies we have responsibility, accountability and are able to make decisions.”

Daxas update

The European approval for Daxascovers all 27 EU countries, as well as Norway, Iceland and Liechtenstein.Other approvals have been gained in the US, Canada, Ukraine and Brazil.Launches took place in 2010 in Germany, the UK, Denmark, Romania and Norway, and more recently in Canada, Sweden, and Spain.In the US, Daliresp (the trademark for roflumilast in the US) is expected to be available towholesalers in the second calendar quarter of 2011.

“The whole of Nycomedis supporting the Daxasregistration and launch– this makes the processsmoother and gives us theflexibility to react faster.”

“A true team effort” Christoph Bunte.

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•FIFTEEN

The impact of business development on Nycomed’s evolution is refl ected in the impressive number of major partnership deals that have been completed in recent years. A new structure and focus now promises to keep the function at the heart of the business.

There has rarely been a quiet moment for Nycomed’s Business Development (BD) team, but 2010 was almost certainly its busiest year ever. Not only was the function fi nalising important external agreements such as those with Guangdong Techpool Bio-Pharma (Techpool) in China and with Merck and Co (MSD) for the co-promotion of Daxas in parts of Europe and Canada, it was also implementing a new internal structure and adopting a new focus.

What kick-started the transformation was the comprehensive review of Nycomed R&D in 2009, which found that the organisation had to shift its focus to supporting late stage

development and launch activities to most effectively meet current and future business demands.

BD adapted its strategy accordingly, and began to look at product and portfolio opportunities either already on the market or near commercialisation, rather than those in development. It also shifted to a regional rather than global focus to bring it closer to local operating companies, with an emphasis on emerging markets. All this while keeping open communication lines to COMOPs, Legal, Operations and other functions, so that sealing deals would continue to happen without missing a beat.

NEW FOCUS FOR NYCOMED’S DEAL MAKERS

SIXTEEN•MEET THE TEAM•BUSINESS DEVELOPMENT

CONTINUED ON PAGE EIGHTEEN

The shift in focus also led to some downsizing, and today BD is a team of 24 people divided into four separate but complementary groups: Corporate Development (Mergers & Acquisitions/Strategic Intelligence); Strategic Partnering; Business Evaluation and Deal Structuring (BEADS); and Corporate Licensing. Since January of this year, all four groups are based at the Nycomed HQ in Zurich.

The changes have made the function leaner and more agile, clearing the way for BD to quickly identify opportunities that will keep Nycomed on its growth trajectory.

“We may be involved in different kinds of deals, but the expertise needed to identify, build and negotiate any deal is the same.”

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•SEVENTEEN

CONTINUED FROM PAGE SEVENTEEN

“When it comes down to it, we are deal makers at heart,” explains Kerstin Valinder, Head of Business Development. “We may be involved in different kinds of deals, but the expertise needed to identify, build and negotiate any agreement is the same - whatever the life cycle stage of an asset.

“The size of the opportunities may often be smaller, too, but each deal requires the same amount of rigour. And because we are now focusing on a far more competitive area, we have to be quicker and sharper in our actions. This new set up helps us do this.”

Not surprisingly, given its new focus, BD’s main interactions are now with colleagues in Commercial Operations (COMOPs), rather than R&D. This is refl ected in the new, aligned regional structures within BEADS and Corporate Licensing, for example, which are led respectively by Roger Lassing and Carlos de Sousa. “We work very closely with COMOPs and Carlos’s team in the regions, supporting local business development and identifying which deals could be switched to other geographies,” says Roger, who leads a team of fi ve.

Carlos heads a group that includes fi ve Licensing Directors, who are responsible for identifying opportunities and coordinating their evaluation, as well as negotiating transactions. He also has a team of two people who look after Project Coordination. In addition to their specifi c regional remits, the Licensing Directors have cross-geographical key account responsibilities.

“The various groups within BD have always been closely aligned, but we are more coordinated with this new structure and there’s more transparency,” Carlos says. “Our

licensing directors have regular contact with their counterparts in Roger’s team, as well as business development representatives in local markets. And our Project Coordination team keeps track of our activities, maintains our database and coordinates due diligence activities, making sure everyone is up to date with what’s happening.”

The close working relationship between BEADS and Corporate Licensing has resulted in deals such as those for veltuzumab, Steovess and, more recently, with Roche for Bonviva in South East Asia and with Eurand for the pancreatic insuffi ciency treatment Zenpep in Russia/CIS. The latter, in particular, also illustrates the rewards for effective collaboration between the business development functions at headquarters and the local operating companies.

Both BEADS and Corporate Licensing also work closely with Mergers & Acquisitions (M&A)/Strategic Intelligence, headed by Gunnar Gårdemyr, and Strategic Partnering, led by Thomas Trah.

Gunnar and his two-member M&A team work closely with COMOPs to identify and evaluate deals, then work through due diligence with their Legal colleagues to complete the agreement. Nycomed has a long tradition of successful acquisitions, not least the deal with ALTANA Pharma. It was also the M&A team that co-ordinated the deals that led to the acquisitions of Zentiva branded products from Sanofi Zentiva in Central and Eastern Europe and Bradley in the US, as well as last year’s agreement with Techpool in China (see panel on page 19). A string of successes once again made possible as a result of working as one global team – and a job that doesn’t end once the ink dries on the contract.

“Even though the China deal is now complete, we are still involved in the integration of Techpool because we are well placed to help implement things that we learned during the due diligence process,” Gunnar says. “We also recently signed a deal to acquire Farmacol in Colombia, which

It’s a deal The Nycomed Business Development team (from left to right) Thomas Trah, Kerstin Valinder, Roger Lassing, Gunnar Gårdemyr and Carlos de Sousa.

Key Nycomed partnershipsBradley Acquisition of a complementary dermatology business in the US in 2008.

EffRx Licensing agreement for Steovess (effervescent alendronate).

Forest Laboratories Development, commercialisation and manufacturing agreement for Daliresp (rofl umilast) in the US.

Guangdong Techpool Bio-Pharma Nycomed acquired a majority stake in the Chinese company in October 2010.

Immunomedics Exclusive worldwide rights to develop,manufacture and commercialise the sub-cutaneous formulation of veltuzumab for all non-cancer indications.

Merck & Co. (MSD) Commercialisation agreement for Daxasin major European markets and Canada.

Micromet Collaboration on the development of anti-GM-CSF antibodies.

Sanofi -Aventis/Zentiva Acquisition of 20 Zentiva branded generic products in several Central and Eastern European countries from Sanofi -Aventis.

Sepracor Exclusive development, marketing and commercialisation rights for ciclesonide in the US.

EIGHTEEN•MEET THE TEAM•BUSINESS DEVELOPMENT

for the implementation of a deal, and work with R&D’s Alliance Management team and, if the product is close to or already on the market, with COMOPs, to prepare an internal kick-off meeting and steering committee sessions with partners for the fi rst year or so,” Thomas says. “We also look after what I call ‘contractual alliance

management’, to discuss and renegotiate terms of the contract as necessary.”

BD has been extremely busy in recent years, and the steady pace of Nycomed’s growth makes it unlikely that this will change in the short or medium term. The function’s challenge, however, is to handle all that work with a much smaller team.

“We are addressing this by holding a series of boot camps for our staff, to make sure everyone has broad knowledge of what each function does in the group,” Kerstin says. “We need to stay as lean as possible, and want people who are fl exible and can work cross-functionally as required. Closing a deal is a hugely complex undertaking. We’ve been successful to date because Nycomed knows how to work across borders and across functions. The energy we see every day to get the job done is something I’m really proud of.”

CLEAR PRIORITIESLooking ahead, BD has four clear priorities for 2011. “We want to continue to expand Nycomed’s geographical footprint in areas such as Asia, Latin America and MENA,” Kerstin explains. “We also want to add products to the company’s existing portfolio at the corporate, regional and local levels. We want to make sure we have the right partners for Daxas in all parts of the world. And we’ll continue to work with our R&D colleagues to identify and negotiate deals for any pipeline projects that could benefi t from strategic partnering.

“It will certainly be another busy year for us. But we’re very excited about the challenge and the contribution we can make to Nycomed’s overall success.”

will give us another important sales and marketing platform. And we are well down the line in talks about an acquisition in India, which we are hoping to announce in the second quarter of this year.”

The team of two within Strategic Intelligence, meanwhile, is responsible for gathering and communicating market and competitor information that supports the company’s commercial strategy as well as its business development targets. A major focus during 2010 was support for the Respiratory team as it prepared for the Daxas launch.

The fi nal piece of the BD jigsaw puzzle is Strategic Partnering. This team looks after the out-licensing of Nycomed’s products, particularly to major markets such as the US and Japan where the company has no direct presence, but also for broader territorial regions. Thomas Trah leads a team of three who have been responsible for several deals, including Sepracor for ciclesonide in the US and Forest (US) and MSD (EU/Canada) for Daxas, as well as the divestment of the company’s oncology portfolio to Bayer-Schering and 4SC.

“We take a proactive approach in preparing our well structured competitive partnering process, collaborating closely with colleagues in R&D project management, COMOPs and Legal” Thomas says. “We also work closely with BEADS, which evaluates potential deals and calculates the business case. And we then structure the deal and its terms before making recommendations to, and getting fi nal approval by, the Nycomed Executive Committee.”

Strategic Partnering’s work also doesn’t end once a deal is signed. “We’re also responsible

“We need to stay as lean as possible …”

Holding out for the right dealNycomed’s majority shareholding acquisition in Chinese company Guangdong Techpool Bio-Pharma may have been completed in October 2010, but Business Development and COMOPs had been preparing for the deal since the end of 2008.

That’s when the company fi nalised its strategy for Asia, which placed China as the priority market, followed by India and Indonesia. Gunnar Gårdemyr’s Mergers & Acquisitions team, working closely with their colleagues in COMOPs, started by contacting three investment banks with ideas on how to target companies, then chose one of them to help put a deal together.

“We looked at many companies, mainly public, evaluating them against strict criteria that included ‘actionability’: was the company likely to be receptive to an approach,” Gunnar says. “Out of that came a long list of 20 to 30 companies, around 15 of which were contacted. The list was then complemented by private companies identifi ed by our Asian management. And then we drew up a short list of companies,which we examined closely during the due diligence process.

“The whole process took longer than we had hoped, but it was absolutely vital that we made sure it was the right deal for the company.”

“… and we need people who are fl exible and can work cross-functionally as required.”

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•NINETEEN

TWENTY•COUNTRY FEATURE•BELGIUM

A SPIRITTO SUCCEED

Belgium is famous for many things – beer, chocolate, mussels, waffl es and chips with mayonnaise to name just a mouth-watering few. But it’s unlikely that many people associate the country that is geographically and symbolically at the heart of Europe with political, cultural and economic challenges.

Those realities, coupled with the global economic downturn and the loss of exclusivity with its number one product, are all part of the daily routine for Nycomed Belgium. But the company has responded to the situation with creativity, entrepreneurialism and a spirit to succeed that has not only seen the company keep its head above water, but even allow it to realistically start anticipating future growth.

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•TWENTYONE

Belgium may have been a sovereign nation for more than 180 years, but it is still suffering from something of an identity crisis. Effectively it is two countries in one, with 58% of the population living in the Dutch-speaking northern region of Flanders and 41% in the French-speaking Walloon community to the south. There is even a small German section to the west, while the capital, Brussels, is virtually a cosmopolitan city-state in its own right.

This wouldn’t normally have much impact on a company such as Nycomed. But the division and disagreement between the two main regions has left the country in a political vacuum, which in turn has created economic uncertainty.

With the Flemish and Walloon parties unable to find any room for agreement after elections last summer, there has been no government in Belgium for the best part of 300 days now and, consequently, no consensus on how to deal with a deepening national debt.

“Our fear is that whoever eventually formsa new government will immediately have toimplement austerity measures,” says Chris Juliam, the head of Nycomed Belgium and the France-Belgium-Netherlands (FraBeNe) country cluster. “The healthcare budget would obviously be an easy target.”

Chris and her team also have to operatein one of Europe’s most highly regulated pharmaceutical environments. Marketing approval is not usually a problem, thanks to the EU’s centralised system, but reimbursement is historically diffi cult. This was illustrated graphically in December 2010, when Daxas was one of nine innovative products that failed to win reimbursement by the authorities at the fi rst attempt.

Given these challenges, Nycomed Belgium’s recent performance is nothing short of remarkable. The loss of exclusivity with Pantoprazole has predictably led to a slight dip in sales, but an innovative and early intervention through the introduction of the

company’s own generic version, Pantomed, has ensured the softest of landings (see pages 24-25).

The relentless pursuit of business development opportunities has also resulted in a portfolio that is not only rich and diverse, covering areas ranging from gastrointestinal, pain and dermatology to cough and cold, vitamins and anti-lice treatments, but also resilient. Thirty percent of the company’s medicines are not reimbursed, and are therefore immune from the annual round of imposed price cuts.

Pantomed, the generic Pantoprazole, remains Nycomed Belgium’s biggest product. Asafl ow, an over-the-counter enteric coated aspirin, is another high-volume market leader, as are calcium treatment Steovit and the thyroid hormone replacement therapy, L-Thyroxine. New corporate products introduced in recent years include Matrifen, TachoSil and Circadin, while 2010 also saw the addition of two new in-licensed brands – the anti-histamine Rupatall and incontinence treatment Mictonorm.

BALANCED PORTFOLIOHaving peaked at €98 million in 2008, sales fell to €90 million in 2009 and €87.5 million in 2010. With Pantomed returning to growth, however, Chris is optimistic that the decline is over. “We are not dependent on one or two products any more. Wehave a large and balanced portfolio,” she says. “Our goal is always to out-perform the market, and we’ve constantly done that despite the issues we’ve faced.

“We also have a lot of know-how, expertise and creativity in the management team and at all levels of the company, and this forms a powerful combination as we look to return to growth.”

Diversity and creativity drive‘remarkable’ performance

Belgium at a glance

Population of 10.5 million.

Occupies an area of 30,528 sq km.

Located in western Europe – shares borders with France, the Netherlands, Germany and Luxembourg.

A constitutional kingdom – head of state is King Albert II.

Became independent from the Netherlands in 1830.

11,626 active GPs – 1 per 903 people

13,338 active specialists – 1 per 787 people.

5,250 pharmacies – 1 per 2,000 people (68% of pharmacists are women).

Vox popWhat is thebest thing aboutworking forNycomed?

“It’s a very dynamic, positive andconstructive working environment, and youreally feel empowered. There’s always achance to try different things, and I feel I’mlearning all the time.” François Browet, Quality Control Assistant (above)

Top table The Nycomed Belgium management team (above), and the company’s Brussels manufacturing facility (below).

TWENTYTWO•COUNTRY FEATURE•BELGIUM

Surveys secureexternal recognition

Nycomed Belgium has four market-leading prescription products – Pantomed (37% market share), Asafl ow (78%), Steovit (52%) and L-Thyroxine (76%) – and it is widely recognised externally as one of the country’s best performing pharma companies.

ZS, a company specialising in sales and marketing related quantifi cations and measures, as well as sales force sizing, ranked it as one of the two best companies after a survey of reps and customers that covered selling skills, call preparation, delivery and follow-up .

The company was also ranked in the top two following a targeting/profiling exercise audited by IMS, which found that Nycomed was more than 90% accurate.

IMS also rated the Pantomed launch the best ever in Belgium – achieving a 32% market share after just six months.

Nycomed Belgium

History dates back to 1835, when Alphonse Christiaens first formed a drug company under his name in Brussels.

Halfslund Nycomed becomes owner of the company in 1992.

Today the company employs around 200 people in its commercial organisation (including 100 sales representatives) and 100 in its manufacturing division.

Key products – Pantomed,Steovit, Asafl ow, L-Thyroxine,Glucadol (Twin), Brexine,Quatral.

13th largest pharmaceutical company in Belgium.

Medical representatives aredivided into four teams – Christiaens, Exel, Sandipro and Nycomed – plus one hospital, one TachoSil and one OTC team.

“Our goal is always to out-perform the market, andwe’ve constantly done that despite the issues we’ve faced.”

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•TWENTYTHREE

Since Belgian doctors are second only to their Spanish counterparts in terms of the number of proton pump inhibitor (PPI) prescriptions they write, it’s easy to see why Pantoprazole has been by far the dominant product in the Nycomed Belgium portfolio for most of the past decade.

As loss of exclusivity approached in 2009, therefore, the company knew it needed to take drastic action to protect a business built up through its twin product approach – Pantozol and Zurcale. A generic Pantoprazole was the preferred option, but General Manager Chris Juliam knew that this would create a number of challenges both internally and externally.

“In the fi rst place we had to convince our stakeholders within Nycomed that it was the right decision, because we knew there would be opposition to any form of genericisation in some quarters of the company,” she says. “Perhaps even more

importantly, Belgian physicians are well-known for not favouring generic products. We had to overcome that resistance.”

This all begs a simple question, of course: given the situation, why on earth was a generic Pantoprazole the preferred option in the fi rst place?

POWERFUL ARGUMENT“We must have been through more than 100 fi nancial scenarios over a three-year period and it was clear that the generic was the best. This was a powerful argument internally,” Chris says. “The issue with the physicians was solved for us by the Belgian government – whether they liked it or not, physicians were told that 40% of their prescriptions had to be for generics or they would face penalties.”

“With Pantoprazole being the PPI of choice for most doctors, they soon played an important role in making the generic

proposal become a reality. “We were approached by Nycomed to give our opinion. Once we heard that the company was considering a launch of its own generic, we urged it to hurry up,” says Dr Patrick Dufraimont, who runs a practice in St Stevens Woluwe near Brussels.

Generic option ensures ‘soft landing’ for Pantoprazole

“Pantoprazole is a very good PPI, and it was important for us that it was the fi rst generic available because of the government’s requirements. I’m delighted that the company took our views into consideration, and I fi rmly believe that this could be a model for the future.”

On 9 March 2009, fi ve weeks before LoE, Nycomed Belgium launched Pantomed at a price 72% lower than Pantozol and Zurcale. Within the fi rst year there was only a 12% drop in sales value, which effectively means sales volume had doubled. By the end of 2010, 18 months after the Pantomed launch, revenue was down just 20% on 2009 to €36 million – a perfect illustration of the ‘soft landing’ required by the company.

If imitation is the sincerest form of fl attery, the decision by Astra Zeneca to follow suit and launch Nexium under a generic status in 2010 shows just what a good idea it was.

“There are still generics out there that are 50% cheaper than Pantomed,” Chris says. “But we were fi rst, and that’s why our sales have held up.

“Further restrictions on doctors are likely in 2011, however, so we know that we have to be proactive and create strategic alliances with the government in key areas if we want that success to continue.”

Vox pop What are the key priorities for Nycomed Belgium in 2011?“It is vital that we keep building relationships with our customers. We must always be absolutely customer-minded and strike the right balance between push and pull to maintain Nycomed’s positive image.”Tom Vierstraete, OTC Sales Representative (above)

Nycomed Belgium’s Medical Director, Johan Imschoot (left), and Sales Director, Paul Maris (above).

TWENTYFOUR•COUNTRY FEATURE•BELGIUM

International experts support Daxas case

The decision by Belgian authorities not to reimburse Daxasat the fi rst time of asking was disappointing, but not a surprise. In a notoriously complex environment, the same thing had happened in the past to Alvesco, and to numerous products submitted by other companies.

The company now plans to launch the product without reimbursement, and to mobilise its advisory boards as it prepares for a further reimbursement round. It will also call on the support of some internationally renowned experts.

“I think Daxas deserves reimbursement. It is a breath of fresh air in the COPD fi eld, and I personally believe it fulfi ls all the criteria of medical need,” says COPD specialist, Professor Marc Decramer, who is Department Head of Pneumology at the Catholic University of Leuven, a member of Nycomed’s Daxas Advisory Board and President of the European

Respiratory Society.

“I think the authorities are looking for perhaps one more study to support the application, but clinical experience in other countries will also help.”

Johan Imschoot, Nycomed Belgium’s Medical Director, comments: “We will reconsider our case with Advisory Board members and try to convince

authorities about the unmet medical need issue.”

Sales Director, Paul Maris, adds: “Rofl umilast is now mentioned in the GOLD (Global initiative for chronic Obstructive Lung Disease) guidelines for COPD therapy, and that will support our future efforts.”

“We must have been through more than 100 fi nancial scenarios over a three-year period and it was clear that the generic option was the best.”

Strategic alliances Physician Dr Patrick Dufraimont (below) and external expert Professor Marc Decramer (right).

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•TWENTYFIVE

Distribution and licensing agreements have always been an important part of Nycomed Belgium’s strategy, and partnerships with companies such as Kyowa and Chiesi have now been in place for more than 20 years.

Before their merger, Nycomed and ALTANA Pharma were also long-term co-marketing partners in the country with Pantoprazole.

In recent years, however, the process of business development has intensifi ed, becoming more organised and focused to meet the demands of the country’s complex reimbursement environment. “We look for products that either don’t need to be reimbursed, or will easily be reimbursed,” explains Pieter Huyghe, Business Development Director.

The company scours Europe for oppor-tunities, Pieter explains, working with Nycomed’s Corporate Licensing department and other European local operating companies to exchange ideas and ensure activities are aligned. “Our targets must not only be a sound fi nancial proposition, they must also be registered or almost registered

and be supported by good clinical evidence. Not least, they must make a medical difference,” he says.

Two products that meet all these criteria were launched in 2010 – the dual-action anti-histamine Rupatall, which is licensed from Spanish company Uriach, and incontinence treatment Mictonorm, which is licensed from Apogepha of Germany. Both have been extremely successful, with Rupatall achieving sales of €1.5 million in its fi rst year – much to the delight of Nycomed’s partners (see panel).

“The aim for 2011 is to keep this momentum going, and we are currently looking at a number of deals in areas that complement our existing portfolio,” Pieter says. “Our aim is to have at least €2 million in business development sales each year.”

NEW IDEAS One of the secrets to Nycomed Belgium’s success is that all employees in the company are fully engaged. People are encouraged to submit ideas and suggestions – and they do: in 2010 more than 400 new ideas were reviewed by a multi-functional committee that includes General Manager Chris Juliam and Pieter himself, as well as representatives from the medical, regulatory and marketing departments.

“We ask everyone, especially our customers and our reps, to keep their ears and eyes open,” Pieter says. “It means they can all contribute to the growth and success of the company, and that is extremely motivating.”

All ears and eyes on Business Development

Vox popWhat do the Nycomed values mean to you?“They are not just words, they are a reality in both our professional and personal lives. Trust and empathy, in particular, are important characteristics of our organisation and in our dealings with customers.”Nico Vandenrijn, Medical Representative, Hospital Team (above)

“Everyone can contribute to the growth and success of the company, and that is extremely motivating.”

Business Development Director, Pieter Huyghe (above).

TWENTYSIX•COUNTRY FEATURE•BELGIUM

Growth ambitions Plant Director, Renaat Baes (above).

Setting an example in partnering

Nycomed’s passion for antihistamine treatment Rupatall not only secured the company a partnership deal with Uriach, but also ensured the product’s success.

That’s the view of Lorena Farré, Licensing Manager at the Spanish company, who describes Nycomed Belgium as “one of our best partners”, which has established itself as “the face of Uriach” in the country.

Rupatall sales were 40% over budget in its fi rst year. “That’s a tremendous performance,” Lorena says. “We hold Belgium up to other countries as an example of what can be achieved. We will be working closely with Nycomed in 2011 in a number of areas, to build on this initial success and drive sales even further.

“Perhaps best of all,” she adds, “is the fact that Nycomed is a very easy company to work with. There is clear communication, both with us and within its own team, and that is refl ected in the results.”

Operational Excellence supports factory expansion

Brussels has been home to some form of pharmaceutical activity for more than 175 years, when Alphonse Christiaens fi rst opened a drug store near the centre of the city. Those activities were later moved to the district of Gentsesteenweg, to the site that now hosts Nycomed Belgium’s commercial, administrative and manufacturing activities.

The Nycomed Christiaens plant still carries the founder’s name in a tribute to its heritage. Today it employs just over 100 people in an 8,000m2 facility that produces and packs around 700 million tablets, 80 million capsules and 60,000 litres of liquids each year.

“Most products are destined for the Belgian market, but we also export to Scandinavia and the Netherlands, and pack Xefo Rapid for markets all over Europe,” explains Plant Director, Renaat Baes.

The production plant currently operates on double shift – 16 hours a day, fi ve days a week – but the ambition is to get up to three shifts a day, in line with the packaging operation. “That would take us up to effi cient capacity utilisation on our key equipment,” Renaat says.

The plant has fully embraced the philosophy of Operational Excellence too. “As well as increasing utilisation, through both Nycomed products and more third party collaborations, one of our top priorities in 2011 is to embed the OpEx ethos even further in the organisation,” Renaat explains.

“By increasing our customer service levels, reducing inventory and improving our performance, we aim to become a lean and agile organisation that can target a signifi cant reduction in costs per unit.”

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•TWENTYSEVEN

Common philosophy supports cluster optimism

as an opportunity to enhance and optimise each of our businesses and products through synergies and the sharing of best practice.”

There is already a commitment to bring together people from all levels within the same functions in the three businesses, to ensure that the identifi cation of these synergies and sharing possibilities is decided on a ‘bottom up’ rather than ‘top down’ basis. And Chris’s optimism is fuelled by the realistic acknowledgement that each market can benefi t from another.

MORE WITH LESS “We don’t have that many overlaps,” she explains. “We all have our own portfolios, for a start, and the complexions of our markets differ greatly. We can also do a lot more with less: in Belgium, for example, we have no indirect procurement function, but they do in the Netherlands so we can tap into that. We also know that we can adapt and use some of the fantastic TachoSil materials that have been put together in France.

“For us it’s all a question of mindset. We believe that we can create cross-country teams that learn from and share with each other because of the cluster, so we will be doing everything in our power to make it a success.”

A physician by training, 50-year-old Chris graduated from the University of Ghent in 1985 and immediately joined Merck Sharp& Dohme as a medical representative. Eleven years later, having held successively senior commercial roles, she moved to Abbott as Business Unit Manager Ethical Care, and stayed for ten years before taking up an offer to head Nycomed Belgium in January 2006. “I inherited a very well-run, highly entrepreneurial business and have tried to keep that approach in the new company,” she says.

“We have worked hard to embed the Nycomed culture and values in Belgium over the past few years, and are now reaping the rewards in terms of having a talented and highly motivated workforce that is really performing. After a small reorganisation last year, which saw a few changes to the management team, I feel we are now in a great position to face the future with confi dence.”

Chris Juliam has faced plenty of business challenges in her life, but the head of Nycomed Belgium admits that the task of leading one of Nycomed’s newest Coordinating Country Concept (CCC) clusters is probably her biggest to date.

The FraBeNe cluster, which covers France, the Netherlands and Luxembourg as well as Belgium, was created in December 2010. Its precise structure and goals, as well as its specifi c initial actions, are still being defi ned. Chris understands that implementing the change and convincing people of its benefi ts will be diffi cult initially, but she is encouraged by the fact that there is already a common philosophy shared between herself, Emmanuel de Rivoire and Mike Egli – her counterparts in France and the Netherlands, respectively at the moment, although Mike is set to move to Canada in April.

“We are all extremely positive about this new approach and are committed to making it work,” she says. “It’s easy to be negative about the cluster system and to look on it simply as a way to cut jobs or take away the independence of smaller markets. But Emmanuel, Mike and I really do look on it

Vox pop What do you think are Nycomed Belgium’s key characteristics??“We are dynamic, proactive and extremely good at adapting to change. The company’s leaders listen to their people, and we are all empowered to make contributions. Most importantly, the management acts on those contributions, which creates a very stimulating and motivating working environment.” Elisabeth Waumans, District Manager (above)

Common philosophy Chris Juliam’s fellow FraBeNe cluster Country Managers – Mike Egli of the Netherlands (top) and Emmanuel de Rivoire of France.

TWENTYEIGHT•COUNTRY FEATURE•BELGIUM

“It is important that we are perceived as a ‘clean and loyal’ company – one that is prudent and operates with integrity, and delivers what it promises.”

Outside work Chris Juliam is a great collector – mostly of antiques, but really of anything for the home that takes her fancy.

“I redecorate the house six times every year – we have a yellow theme at Easter, green and red at Christmas and so on,” she says. “I love going to fl ea or antique markets and fi nding little things that look interesting.”

A passion for collecting

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•TWENTYNINE

Gesche Ahrens thoroughly enjoys her job as an OpEx Black Belt – not only because it is personally rewarding, but because she knows she is adding value to the business.

Winter mornings can be tough for Gesche Ahrens – waking early when it’s dark, cold and often icy, with her husband and kids still asleep, and leaving the house at 6.15am for a 45-minute drive to Nycomed’s production plant in Singen, Germany, where she works as an Operational Excellence (OpEx) Black Belt.

One thing keeps her going – she really loves her job.

“Process improvement is something that really inspires me, and this role is a great opportunity to be involved in that area cross-functionally and across all value streams,” she says. “OpEx is very hands on. Running workshops with diverse teams is the fun part, and it helps us eliminate bottlenecks, reduce waste and create process fl ow. It is really satisfying that changes are usually immediate, so we get to see the fruits of our efforts very quickly. You also know that these efforts add tremendous value to the overall Operations function and therefore to Nycomed as a whole. That is exciting, and extremely motivating.”

Gesche was introduced to Nycomed by a friend in 1997. She completed a one-year post-doctorate fellowship in R&D, before taking increasingly senior positions in Quality Assurance, Production and the Supply Chain, most recently as head of Strategic Sourcing. This broad experience gave her deep insight into all parts of the business, which in turn made her an ideal choice for her current role. After 18 months of ‘on the job’ training, she was certifi ed as one of the company’s fi rst fi ve Black Belts in November 2010.

During her Black Belt project she worked with a team on the Pantoprazole i.v. production fl ow. The objective was to stabilise the process and increase the output. The integration of OpEx in the routine processes and opening the mind sets of people towards the change needed was also a major part of her certifi cation.

“The training has not only made me a competent pair of hands within an OpEx environment, but has also shown me how I can improve my broader business capabilities,” she says. “One important

thing I’ve learned is that OpEx is as much about teamwork as it is about tools and techniques, so I am also keen to help more people get involved.”

Gesche’s role as an OpEx Black Belt means that she is the primary OpEx contact for Singen. She helps all functions align their efforts with business priorities, and works with line managers to make sure OpEx principles are used to achieve their goals. OpEx is not just a set of tools and projects, she says: it changes the way she and her Operations colleagues think and work.

TALKING AND LISTENING“As a Black Belt, I support the identifi cation of potential opportunities for process improvements, which in turn saves money and leads to smarter ways of working,” she explains. “This can be top-down – site management coming up with ideas and actions to help individuals and teams achieve their goals. Or it can be bottom-up – talking and listening to people about what really matters to them, what their challenges are, and how they think things can be improved.

New ways of thinking,

07:00hrs Gesche checks her e-mails on arrival (left).08:30hrs Preparing for a workshop (top).11:00hrs Reviewing progress with Plant Manager

Jürgen Mahling (above).13:30hrs Optimising printed data with mechanic

Jürgen Bohner (right).

THIRTY•A DAY IN THE LIFE•GESCHE AHRENS

“I believe that we achieve the best sustainability when OpEx is embedded into our daily processes and in the mindset of the organisation.”

Gesche’s working day begins at 7am – usually with a cup of strong coffee as she checks her e-mails. Some days she will go straight into one of the regular workshops or coaching sessions she runs for Singen’s 40 trained Green Belts: on others she will inevitably be preparing for one of these sessions, or meeting with teams and individuals to discuss their issues.

“I try to take a break about 12.30pm for lunch. The canteen here is extremely good,” she says. “On really busy days, when I’m rushing around, I have to take a sandwich back to my desk and keep working.”

Gesche’s daily and weekly routine is dictated by priorities and specifi c project plans, but she does have annual goals. “Where possible, I try and plan my schedule at least ten days in advance,” she explains.

She adds: “Whatever the workload, I try to fi nish at 5.30pm. This means I can get home in good time to sit down with my kids and hear what they have been up to during the day. They are seven and 11, and already they have very busy lives.

“After that I will just sit and chat with my husband, or maybe visit friends. But if I’m running a workshop I will sometimes take home fl ip charts so that I can summarise them ready for the next day.”

Looking to the future, Gesche says she is keen to expand her experience and further develop her skills. “When I fi rst started this job I had to accept that OpEx was an

add-on initiative, and that resources were not easy to get,” she says. “Now that it is integrated in embedded teams and routine processes, and especially since we started to communicate success stories, the phone is always ringing, with managers wanting to kick off further projects and workshops.

“This has enabled us to increase the output of three production value streams and, for example, reduce the throughput time for one value stream by 30%. We achieved these results by introducing a completely new scheduling system for one area, reducing equipment downtimes, standardising processes, fi xing regular technical problems and much more.”

Gesche…

What is the best thing about your job?The huge variety, the opportunity to work cross-functionally, and the fact that you see benefi ts immediately.

And the most frustrating?At fi rst it was trying to enthuse people about what they felt was just another quality initiative. That doesn’t apply now, as people can see the benefi ts.

What two things can you not do without?My camera, because I need to record all innovative ideas and results of workshops, as well as the atmosphere in the teams. And my computer – it has all the data, charts and photographs I need to use on a daily basis.

“One of the most satisfying things about OpEx is that changes are usually immediate, so we get to see the fruits of our efforts very quickly.”

, new ways of working

09:30hrs Reviewing fi nancial KPIs with Controller, Matthias Riester (top).

15:00hrs Running a workshop (above).17:30hrs On the way home… complete with

camera, computer and work for the evening (right).

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•THIRTYONE

from male human urine and consists of 143 amino acids. It inhibits the activities of the trypsin and prevents the body from producing an excessive infl ammatory response, so blocking SIRS and MODS and eventually reducing the incidence of multiple organ failure.

Studies have shown that levels of Ulinastatin in urine are greatly increased in patients with infl ammation or infection, subsequently returning to normal levels as the particular disease gets cured. This indicates that it might be a natural safeguard for the human body.

Ulinastatin was initially launched in 1985 in Japan by Mochida Pharma. Techpool developed the product through a project funded by the Chinese government, and began marketing it in China in 1999. Since then, Techpool has become the exclusive manufacturer of both the active pharmaceutical ingredient (API) and fi nished product in the Chinese market, and subsequently launched it in Korea in 2002.

It is estimated that over 20 million vials of Ulinastatin have been sold in China alone, treating more than 1.5 million patients and demonstrating a great safety and clinical effi cacy profi le in the process.

Clinically, the medicine is used principally to treat sepsis, pancreatitis and other critical illnesses, but it also has application in certain surgical procedures. To support its use in sepsis, a multi-centre, randomised and controlled clinical trial has been conducted involving a total of 342 patients at 21 Chinese hospitals. The results indicate that Ulinastatin can signifi cantly reduce the mortality of sepsis patients.

Based on the extensive clinical evidence available, Ulinastatin has been listed in the Catalogue of Drugs for Basic National Medical Insurance since 2005. This confi rms that the effectiveness and solid safety profi le of Ulinastatin are recognised by the Chinese authorities. Now the medicine is used routinely in 650 large, AAA hospitals (800+ beds) and 550 middle-sized hospitals. This has seen annual sales of Ulinastatin grow at an average of 30% over the past three years, with turnover reaching $76 million in 2010 (around €57 million).

GREAT EXCITEMENTThat growth in China is expected to continue at the same rate, while there is great excitement about its potential in other international markets following Nycomed’s majority stake acquisition of Techpool in November 2010. Of particular interest is Nycomed’s focus on emerging markets, where most of Techpool’s registration information could be shared.

“At the 2010 annual COMOPs meeting in Istanbul, interest was shown in the potential of Ulinastatin in emerging markets such as CIS, Brazil, Latin America and Turkey,” says YL Liew, head of Nycomed’s North Asian Region “We are now working closely with the Nycomed global team to exchange information, analyse any gaps in registration requirements and then roll out a strategy to get this medicine to a broader patient population.”

Nature’s bodyguardNycomed’s decision to acquire a majority stake in Techpool Bio-Pharma (Techpool) in China was driven largely by the fact that the two companies have highly complementary portfolios. Ulinastatin is a perfect example of this: a general infl ammatory agent used to treat conditions such as sepsis and acute pancreatitis, it is an impressive addition to Nycomed’s existing critical care portfolio that includes Actoveginfor post-stroke care and Ebrantil for emergency hypertension.

Ulinastatin is a urinary trypsin inhibitor (UTI). Trypsin is an enzyme produced by the pancreas, and is one of three chemicals that help break down dietary protein molecules in the small intestine during the digestion process.

Infl ammatory conditions such as acute pancreatitis and sepsis (see panel text opposite) involve the excessive release of trypsin, as well as infl ammatory mediators such as cytokines. These can lead to the development of systemic infl ammatory response syndrome (SIRS), which in turn can result in the potentially fatal multiple organ dysfunction syndrome (MODS).

Ulinastatin is a natural, broad-acting protease inhibitor that is isolated

One of the key products that will be promoted by Nycomed following the acquisition of a majority stake in Guangdong Techpool Bio-Pharma Co., Ltd. in China last year is the innovative protein medicine, Ulinastatin.So what is it, how does it work, and what are its prospects?

Tertiary structure of Ulnastatin

“Over 20 million vials of Ulinastatin have been sold in China, treating more than 1.5 million patients.”

THIRTYTWO•PRODUCT PROFILE•ULINASTATIN

Pancreatitis and sepsis

Pancreatitis is infl ammation of the pancreas, associated with alcohol, trauma, or pancreatic-duct obstruction. It involves activated enzymes escaping into pancreatic tissues causing irritation and infl ammation. If left untreated bleeding, tissue scarring, pus formation, infection and death may occur. Symptoms include severe pain, low fever, nausea, and hypertension.

Sepsis, sometimes called blood poisoning, is a potentially serious medical condition characterised by a whole-body infl ammatory state and the presence of a known or suspected infection. The body may develop this infl ammatory response by the immune system to microbes in the blood, urine, lungs, skin, or other tissues.

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•THIRTYTHREE

Ulinastatin mechanism of action

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Nycomed is looking more and more to the emerging markets for its future growth, so how does this impact our production and distribution strategy? We put Barthold Piening, Head of Global Operations, in the Hot Seat to fi nd out.

What is the potential and signifi cance of manufacturing plants in emerging markets: will we reinforce our network here?

We have been doing so, and will continue to do so where it makes sense for the company. We have the foundation to be fl exible and adaptable, and to expand at the same time since our strategic focus is on the three pillars of manufacturing, supply chain and developing our people.

Look at what we’re doing in India, China and Russia. There’s a lot of technology transfer and investment, but also plenty of fi guring out how to work in a different culture. We need to be able to lean back and refl ect on how we’ve done things, and what we’ve learned. One result of that refl ection is that now Miguel Ayala, Claus van der Stouwe and Rainer Wiartalla are adding responsibility for facilities in new markets on top of their regional roles.

Does it always make sense to build or acquire a manufacturing plant to gain or maintain market access?

Everything depends on the business case. Regulations vary from country to country – for example, we may opt for a local packaging plant for pharmaceuticals produced elsewhere if that satisfi es regulatory requirements.

Political factors also come into play. Previously we had to have manufacturing plants in pretty much every European country, but as the EU became more of a reality we didn’t need to maintain plants everywhere. In the longer term we have to follow political and regulatory changes in the regions where we are active, and plan our network and activities accordingly.

HOTSEAT

Flexible and adaptableBarthold Piening, Head of Global Operations at Zurich headquarters (above) in Brazil on the solids packaging line during a recent visit to the Jaguariúna plant (right) and addressing a meeting of all employees (far right).

Whaeme

Operations adapting to new challenges

THIRTYFOUR•HOT SEAT•BARTHOLD PIENING

How does this impact our global supply chain strategy?

The supply chain is, in some ways, more complex than manufacturing. It’s about planning, order handling, fl exibility and timely communication— and needs a lot of ‘soft skills’. To be a truly effi cient, supply chain-driven organisation requires strong and active communication with colleagues in COMOPs and in all LOCs and markets. In big markets such as Russia/CIS we’ve even established a fully-fl edged supply chain team.

We’ve also just appointed Jörg Michaelis to coordinate new supply chain initiatives towards emerging markets. This will help to make sure that we’re serving the new markets right from the start. Plus, we have one of our most experienced managers, Joseph Simons, solely dedicated to emerging market projects.

Where does our global supply chain work especially well?

Latin America is a good example. We combine our products coming from Europe with a strong local component, for instance Neosaldinain Brazil. The cooperation between Marketing and Operations in Brazil is a perfect example of how our supply chain strategy should work. Plant Manager Luiz Fortuna spends a fi xed part of his working week in the sales offi ces in São Paulo, so he knows exactly what the sales needs are.

What does the emerging markets shift mean for Global Operations, with its concentration in Europe?

Our core technical knowledge and process capabilities will stay focused in Europe, with large-scale production in countries where technology and quality is up to our standards. For example, while a calcium product may not seem so complex on fi rst sight, in fact it requires special know-how, and in Asker they have the necessary expertise in the particular manufacturing technology to come up with new formulations.

So we will transfer technology where required and feasible — we’ve done it with the API (active pharmaceutical ingredient) transfers to India, and are working intensively on technology transfer of products to the new plant in Russia.

Even with APIs coming from Zydus Nycomed in India, can we be competitive on cost if we manufacture most global products in Europe?

Direct labour costs are only a small part of our production costs. Most of them are the APIs, raw materials, packaging materials — and here we don’t cut corners. There is no compromise on quality: we invest a lot of time and money to bring manufacturing in ‘low-cost’ countries up to our ‘mature market/high quality’ standards.

But there is more we can do. We need to look at product design, other formulations that we can offer at lower cost in growth markets. Obviously we sit together with R&D to work this out, but there is a lot that Global Operations with its manufacturing expertise can offer.

Serving new markets means delivering increased volumes and possibly broadening our product portfolio. Is our network set up to do this cost-effectively?

We are very fl exible. We have sophisticated technologies such as sterile liquids in Singen and Linz, while our core solids production is handled effi ciently in Asker and Oranienburg. We also have access to countries such as India and China, which offer low-cost manufacturing opportunities.

So we stay competitive with a healthy mix of cost-attractive sourcing from Asia, and manufacturing highly effi ciently and creatively in ‘mature market’ sites. We also have a good network of external partners manufacturing various products with specialised technologies.

Russia is not a typical low-cost manufacturing site, but a case of moving production to enhance our market position. That’s why we’re now doing a lot of technology transfer to the new Yaroslavl plant from our competence centres, such as Linz for Actovegin and Asker for calcium.

Historically we are used to a broad product portfolio, since we have often grown by acquiring companies with a huge range of products. This leads to complex manufacturing in small batches, but we handle it — our plants in Brussels and Hobro do this extremely well.

We have a lot to do this year. In our established sites we can optimise our sophisticated production even further, and this is where Operational Excellence plays a key role. We are getting better with standardising processes and, if we run effi ciently and with high economies of scale, we can stay very competitive. So I’m confi dent we have the right strategy and the right structures to meet our challenges.

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•THIRTYFIVE

“We are getting better with standardising processes and, if we run effi ciently and with high economies of scale, we can stay very competitive.”

Familiarity and connection with the values Agreement and disagreement with the following statements:

Adoption and effect of the values Agreement and disagreement with the following statements:

The Nycomed Values and Culture survey also identifi es areas for improvement. “Nearly 20% of people surveyed say they don’t think there’s enough trust and openness between departments,” Nikolaj explains. “That’s a pretty strong signal to all of us that more of an effort needs to be made in creating an atmosphere of trust.”

He adds: “The notion of being a Role Model starts from the top, so I was really happy to see that the results on this were positive.”

Seventy percent of people said that Nycomed leaders were committed to developing their teams, with a similar number saying that global leaders and local managers were successful Role Models.

“Employees rate this as one of the most important categories, with around 90% saying it mattered to them that leaders and managers were effective Role Models,” Nikolaj says. “Leadership development is a big part of our work with the values and I’ll be using these numbers to stress the importance of leaders challenging themselves on whether they are ‘walking the talk’.”

BIG QUESTION So what about the biggest question of all – how do employees rate Nycomed as a place to work?

An organisation survey carried out in 2007, just after the acquisition of Altana Pharma, found that employees were uncertain about many things, including what kind of company the new organisation would be to work for.

Getting the measure of Nycomed’s culture

Plenty of organisations claim to have a culture that is ‘something special’, but Nycomed’s claim is better than most after a recent company survey found that nine out of ten employees not only identify with the culture personally, but also understand how the values can be of practical use in their daily work.

“These results are pretty positive, especially when you consider that the survey was conducted against the backdrop of a lot of change in the company,” says Nikolaj Knudtzon, head of the Culture and Values initiative.

One-third of all Nycomed employees took part in the recent Values and Culture survey. So how do you rate the company as a place to work?

“We are moving in the right direction – the efforts of the past few years are being felt by employees worldwide.”

I see a clear connection between the values and Nycomed’s long-term strategy

The values have a positive effect on performance in my workgroup

At Nycomed people’s contribution is more important than their status

At Nycomed people are encouraged to develop innovative ideas

Strongly agree Agree Neither agree nor disagree DisagreeStrongly disagree

37% 31% 17% 9% 6%

56% 32% 6% 3% 3%

I understand how the values can be of practical use in my daily work

33%

31%

36%

18%

19%

19%

5%

9%

8%

3%

5%

4%

41%

36%

33%

THIRTYSIX•VALUES AND CULTURE SURVEY

The Values Journey

Survey highlights

2007The Values and Role Model concept are launched

90%of employees identify personally with the culture.

90%understand how the values can be of practical use in their daily work.

75%see a clear connection between the values and building a high performance organisation.

75%think the values have a positive effect on their work group.

66%feel that Nycomed has a culture that promotes and recognises innovation and improvement.

45%think Nycomed has a more motivating culture than it did three years ago.

67%think the culture will be even more motivating in three years time.

2008Nearly 1,000 managers participate in values workshops worldwide

Train the trainer sessions for 85 values ambassadors who roll-out the ‘dialogue-mats’ in 22 languages

2009Dedicated intranet area launched for values resources; values give-aways launched

Leadership programme on coaching skills launched, with every session fully subscribed

‘Values implementation survey’ assesses progress in every country

2010Nycomed Stories video project gathers nearly 90 stories from employees

A global Values and Culture survey receives around 3,500 responses

The values being lived by leaders and colleagues Importance that the following groups act as role models for living the values:

90%%% 90%%%

20%

16%

12%

4%

2%

1%

2%

64%

79%

At the time, just 16% of employees said they thought Nycomed was a good place to work, a number that Nikolaj says provided the impetus for the subsequent values efforts.

“It was clear that more had to be done to ensure Nycomed’s culture and spirit could assert itself,” he says. “We wanted to send a clear signal about our aspirations for Nycomed, and have employees sign up by saying ‘this is the kind of place where I want to work’.”

Four years were spent promoting and embedding the Nycomed values of Empathy, Trust, Courage and Motivation, and the concept of being a Role Model, before the recent survey was made available in ten languages. This was created in electronic form via iNside and in printed format for countries that requested it. In just three weeks, around 3,500 Nycomed employees took part.

”The response rate alone told us that this is something people really care about,” Nikolaj says.

The results show the progress Nycomed has made as an organisation. Forty-fi ve per cent of employees think Nycomed has a more motivating culture than it did three years ago – that it is a good place to work. More importantly, 67% think

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•THIRTYSEVEN

the culture will be even more motivating in three years time.

“What I take from this is that we are moving in the right direction – that the efforts of the past few years are being felt by employees worldwide. There is still plenty of room for improvement, but employees are telling us that they are optimistic, that they see how things have changed and hope that the momentum will continue.”

Nikolaj and his team now want to make sure Nycomed’s culture continues to develop positively by taking many of the survey fi ndings and building them into their business plan.

“The survey told us that employees want more guidance on using the values in real work scenarios, and they want more stories about how colleagues have been role models. They also want more opportunities to discuss what the values mean to them in a team setting. Most importantly, they want to see their managers and leaders being exemplary Role Models of how to live the values, in good times and bad.

“We can’t be complacent,” he concludes. “Clearly, there’s still work to be done, but for now these results are a signal of approval and cautious optimism.”

Nycomed’s senior global leaders

Your local leadership team

Very important Important Moderately importantOf little importance Unimportant

Visit the Values site to see the full results. http://inside.nycomed.local/corporate/values/Values_Culture%20Survey/Documents/Values%20and%20Culture%20Survey_Results.pdf

partner inrtnerr inn

‘A meetingof minds’ chain management perfectly complement

Nycomed’s product know-how, engineering expertise and quality assurance ability. But these are not the only reasons why the two companies are such a good fi t.

“For any joint venture to be successful, there must be shared understanding, mutual respect and openness between the partners. Both partners must also be committed to common goals, and that is exactly what we have atZydus Nycomed,” says Mr Patel.

“It is reflected not just in the objectives, but also in the work ethos. Zydus Nycomed embodies the spirit of excellence and the desire to reach out and do better. Zydus Nycomed is on a road where each effort is an improvement on the one before. If we look back on the developments so far, we see achain of accomplishments. Each effort is an important one, and together they link up toform a piece that is strong and enduring.”

Ravi Chandran, Managing Director of Zydus Nycomed, adds: “Trust is a key factor in the success of the joint venture. While our Indian partners have remained the same, the European representatives have changed from Byk Gulden to ALTANA Pharma and now Nycomed, with different cultures and working styles each time. It is common beliefs and goals that cement the two parties, and a trust in each other’s commitment.”

It was a “meeting of minds, a common interest” that laid the foundations of the Indian joint venture between Zydus Cadila and Nycomed, according to Zydus Cadila Chairman and Managing Director, Pankaj R Patel. And it is those same qualities, he says, that have kept the two partners together for more than 12 years.

It was December 1998 when Mr Patel shook hands with Heinz Bull, Chairman of what was then still Byk Gulden, on an agreement that initially involved clinical trials collaboration and then the manufactureof key intermediates for the production of Pantoprazole in a brand new state of the art plant in Mumbai.

The plant now provides intermediates for around 60% of the global Pantoprazole supply.

“Zydus Cadila had an interest in the fi eld of gastrointestinals – in fact, it continues to be one of our core areas,” Mr Patel says. “While developing new processes forseveral molecules in the segment, including Pantoprazole, we approached Byk Gulden and shared our experiences with them. Within just four years of setting up the joint venture, the company had made a successful transition from the project stage to commencing commercial operations. It has become a verysuccessful JV company model in the industry and a benchmark for high quality production at the most competitive prices.”

A new era for the partnership began in March 2008, when Zydus Cadila and Nycomed signed a deal to make Zydus Nycomed one of the hubs for our global supply of activepharmaceutical ingredients (APIs). This not only includes annual production of 35 tonnes of Pantoprazole Sodium, the API in Pantoprazole, but also APIs for other branded generics such as Urapidil, Policresulen, Lornoxicam and Sulfametrole.

Since the existing plant was unable toaccommodate the expected increase in volumes, a new API plant has been built on the existing plot, comprising offi ces, quality control and microbiology laboratories, as well as a storage facility for chemicals. This was inaugurated in September 2010.

Zydus Cadila is one of India’s major health care providers and its high level of expertise in the areas of manufacturing and supply

The transfer of Nycomed’s Active Pharmaceutical Ingredient (API) production from Singen and Linz to the newly-expanded plant at Zydus Nycomed in Mumbai is almost complete. So what do we know about our Indian partners in the joint venture, Zydus Cadila?

Mutual respect Shared understanding, trust and openness are key factors in the success of Zydus Nycomed, say Pankaj Patel (top) and Ravi Chandran.

Zydus Cadila was founded in 1952 and is now one of India’s top five pharma companies.Headquartered in the Indian city of Ahmedabad, it has over 12,000 employees worldwide, a world-class research and development centre dedicated to discovery research, and eight state of the art manufacturing plants.The company expects its sales to pass the US$1 billion (€740 billion) mark in 2011.It was named India’s ‘Emerging Company of the Year’ by the Economic Times Awards for Corporate Excellence 2010.

Zydus Cadila at a glance

“Zydus Nycomedembodies the spirit ofexcellence and thedesire to reach outand do better.”

THIRTYEIGHT•PARTNER IN FOCUS•ZYDUS CADILA

This is Nycomed

Editorial

All products in italics are registered trademarks of the Nycomed group.

The NycomedMagazine is producedby CorporateCommunications andis intended for internaldistribution only.

FEEDBACK…is welcome, as are ideas for future issues.

Please e-mail megan.macrae@nycomed.com

Corporate Communications: Walter VaterlausPublisher: Birgit GronkowskiManaging Editor: Megan MacRaeEditor: Nick ReedDesign: Dave JohnsonContributors: Anna Artemeva, Martin Buschmann, Magali Coremans, Ward Geerts, Justin Hession, Lau Polinésio. Thanks to all Nycomed employees who have helped put this issue together.

Print: Burger Druck, D-WaldkirchPaper: Wood-free Profi silk silkmatt coated.

The contents of The Nycomed Magazine do not necessarily refl ect offi cial Nycomed views. Copyright for photographs and illustrations in The Nycomed Magazine are not always owned by Nycomed.

Megan MacRae

Much of its success points to a hugely engaged leader who embodies a wonderful combination of business savvy and great love for the country, its people and way of life. A Norwegian converted forever.

Our products, however – and our commitment to quality – know no borders. TachoSil is spanning continents as you’ll see in the Product Profi le. Our Operational Excellence programme, or OpEx – as the folks in Operations like to call it, is running full throttle. You’ll read fi rst-hand from ‘Black Belt’ Gesche Ahrens about the things she and her team are doing to improve processes and increase output.

And our Daxas cross registration team is moving mountains to clear this most important fi rst hurdle in getting our COPD medicine to patients worldwide.

You’ll see we have attached a small booklet at the back of the magazine. It’s called ‘This is Nycomed’. It will come in handy when telling the Nycomed story. It outlines in simple terms our vision, mission, strategy and key strategic pillars. It’s easy to fl ip through and refer to for reference and inspiration.

I’ve only touched on a few of the topics covered in this issue. There’s plenty more awaiting you, such as meeting our Business Development team, a Hot Seat interview with our Head of Operations and some interesting results just in on our Values Survey – results that show we’ve got a motivated global team ready to make our strategy happen.

Enjoy the issue!

When we talk about strategy we often say we can’t have Europe without emerging markets, and vice versa, if Nycomed is to expand. This issue backs that claim.

In the Business Update, you’ll get a sense for how it all comes together: the importance of expanding our presence in growth markets and the importance of keeping up a strong, unifi ed – and profi table – Europe. Head of COMOPs Guido Oelkers talks about what we need to do in order to stay on course. He gives examples of how we are putting our emerging markets expansion strategy to work. He also cites the ‘ONE Nycomed in Europe’ (ONE) initiative as an example of how we are readjusting the lens to take a broader European view when it comes to some of the larger strategic decisions we need to make. It’s a push to look beyond local country borders for the benefi t of Nycomed as a whole.

While we’re on the subject of Europe, check out the Belgium profi le with Country Manager Chris Juliam. In the face of all sorts of challenges, Chris and her team just keep on posting solid results. No wonder: their rally cry is to ‘always out-perform the market’ – a cry that will now carry over to the new ‘FraBeNe’ cluster she’s leading as part of the One approach.

And then there’s the recent deal signing with Colombia-based Farmacol – the latest strategic move in our emerging markets growth strategy. As Norbert Oppitz, our Head of the Latin America region, says –if you want to be a player in Latin America, youneed to establish a foothold in Colombia. And that’swhat we’ve done.

One of our brightest stars on the emerging markets horizon is Russia/CIS. After reading the Profi le with Jostein Davidsen, Head of Russia/CIS, you’ll understand a bit better why this LOC keeps on shining bright.

The Nycomed Magazine is a publication for Nycomed employees around the world.

ISSUE 13 Q2 2011

Nycomed International Management GmbHThurgauerstrasse 1308152 Glattpark-Opfi kon (Zurich)Switzerland

www.nycomed.com

© Nycomed 2011

d

This is Nycomed

THE NYCOMED MAGAZINETHE NYCOMED MAGAZINE ISSUE 13 Q2 2011•THIRTYNINE

New Brand Portal helps coherent communication

What we are all about

New offi ce paves way for ‘Quantum Leap’ in Saudi ArabiaNycomed Saudi Arabia has paved the way for its next stage of expansion by moving to a new offi ce in the port city of Jeddah.

The company, which contributes 22% of all Nycomed sales in the Middle East North Africa (MENA) region, has plans to increase turnover from its current level of €17.7 million to €70 million by 2015.

It aims to do so by launching new medicines such as Daxas and Omnaris, forging in-licensing partnerships and improving market access.

“To be ready for this ‘Quantum Leap’ development we need a suitable working environment for our offi ce-based staff of 30 people,” says Country Manager Ahdy Abdul Salam El Sayes. “Our new offi ces in Jeddah fi t the bill perfectly in that regard.”

This little booklet serves as a strategic compass. It holds in its tiny frame statements that back up our strategy. Combined, they tell the Nycomed story. What we are about, where we are going and how we plan to get there.

It includes the fi ve ‘pillar’ statements that support our strategic direction, like what we mean when we say we have ‘strength in dynamic markets’, or that we provide ‘medicines that matter’ or we’ve entered ‘a new phase of growth’.

The booklet is available online, along with the new ‘This is Nycomed’ poster. You can fi nd them on iNside, under ‘About us > Our Strategy’. There’s also an interactive version that includes more details – or proof-points – that further support our strategic positioning.

in their behaviour, our story and what we stand for becomes a clear differentiator in a competitive industry,” Dagmar explains.

The portal features the Nycomed Brand Story – who we are and what we stand for – including our brand essence – ‘Everything we do matters to somebody.’ It gives Visual Identity guidance in terms of how to use the Nycomed logo, colours, fonts, design elements and photography style. It also includes our company glossary and writing style guide.

There’s a download area with a range of print and electronic media templates, and a ‘Services’ section that includes news and contact details for the Branding Hotline.

“When we use the guidelines consistently on a global level, our values and what we stand for come through loud and clear.”

The Nycomed Brand Portal can be accessed through the intranet iNside – no password is needed. Agencies can also access it after registration at www.nycomed.com/brandportal/

Settling inNycomed Saudi Arabia Professional Sales Representatives Sherif Nabil (left) and Ahmed Fahmy in the reception of the company’s new offi ce.

It’s not often you fi nd something that makes life easier for employees AND saves the company money. But that’s exactly what Nycomed’s new Brand Portal manages to achieve.

The portal, launched in March, provides a one stop shop on ‘all things brand’ – from the colours and images we choose to the language we use. It provides a variety of templates, applications and a branding hotline. And even working with agencies is easier because they can have external access.

“One of Corporate Communications’ main objectives is to ensure a globally coherent image of Nycomed. To do this in a cost effi cient way, we provide tools, templates and services for everyone that are ready-to-use. One of these is the newly developed Brand Portal,” explains Dagmar Lüdtke, Nycomed’s Brand Manager.

The Nycomed brand is much more than a unique visual identity. It infl uences all Nycomed stakeholders on both emotional and intellectual levels. The Brand Portal helps distinguish the company in terms of messaging and appearance, and supports the company’s business strategy.

“When every Nycomed employee consistently presents the company not only visually and in the written word, but also

This is Nycomed

IN BRIEF

INSIDE

The future is in our hands COMOPs ready to meet challenges

From Russia with love Jostein Davidsen interview

A spirit to succeed Nycomed Belgium in profi le

ISSUE 13 Q2 2011

New focus for deal makers Business Development adapts to stay at the heart of the business

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