GSK Investor Presentation
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GSK Investor Presentation May 2019 Krupali Engineering researcher Nashik, India Cautionary statement regarding forward-looking statements This presentation may contain forward-looking statements. Forward-looking statements give the Group’s current expectations or forecasts of future events. An investor can identify these statements by the fact that they do not relate strictly to historical or current facts. They use words such as ‘anticipate’, ‘estimate’, ‘expect’, ‘intend’, ‘will’, ‘project’, ‘plan’, ‘believe’, ‘target’ and other words and terms of similar meaning in connection with any discussion of future operating or financial performance. In particular, these include statements relating to future actions, prospective products or product approvals, future performance or results of current and anticipated products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, dividend payments and financial results. Other than in accordance with its legal or regulatory obligations (including under the Market Abuse Regulations, UK Listing Rules and the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority), the Group undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. Investors should, however, consult any additional disclosures that the Group may make in any documents which it publishes and/or files with the US Securities and Exchange Commission (SEC). All investors, wherever located, should take note of these disclosures. Accordingly, no assurance can be given that any particular expectation will be met and investors are cautioned not to place undue reliance on the forward-looking statements. Forward-looking statements are subject to assumptions, inherent risks and uncertainties, many of which relate to factors that are beyond the Group’s control or precise estimate. The Group cautions investors that a number of important factors, including those in this presentation, could cause actual results to differ materially from those expressed or implied in any forward-looking statement. Such factors include, but are not limited to, those discussed under Item 3.D ‘Risk factors’ in the Group’s Annual Report on Form 20-F for FY 2018. Any forward-looking statements made by or on behalf of the Group speak only as of the date they are made and are based upon the knowledge and information available to the Directors on the date of this presentation. A number of adjusted measures are used to report the performance of our business, which are non-IFRS measures. These measures are defined and reconciliations to the nearest IFRS measure are available in our first quarter 2019 earnings release and Annual Report on Form 20-F for FY 2018. All expectations and targets regarding future performance and the dividend should be read together with “Assumptions related to 2019 guidance and 2016-2020 outlook” on page 36 of our first quarter 2019 earnings release. 2 Three centuries of innovation Group: revenue breakdown 2018 Revenues of £30.8bn (+5% CER) Business Units Regions Vaccines (+16%) Consumer (+2%) Europe (-1%) £5.9bn (19%) £7.7bn £8.0bn (25%) (26%) US (+9%) £12.0bn (39%) £10.9bn £17.3bn (35%) (56%) International (+4%) Pharma (+2%) Source: GSK Full year 2018 results release – February 2019 4 All growths at constant exchange rates (CER). Breakdown percentages are approximate Pharmaceuticals Our Pharmaceuticals business has a broad portfolio of innovative and established medicines with commercial leadership in respiratory and HIV. Our R&D approach focuses on science related to the immune system, use of genetics and advanced technologies. £17.3bn, +2% CER Sales turnover 2018 Key Products Triumeq/Tivicay HIV Trelegy COPD Nucala Severe Asthma Immune system T-cells attacking a cancer cell Vaccines Our Vaccines business has a broad portfolio and innovative pipeline of vaccines to help protect people throughout life. We deliver over two million vaccine doses per day to people living in over 160 countries. £5.9bn, +16% CER Sales turnover 2018 Key Products Shingrix Shingles Infanrix/Pediarix Paediatric Bexsero, Menveo Meningitis Herpes zoster virus of shingles Consumer Healthcare Our Consumer Healthcare business develops and markets an innovative portfolio of consumer preferred and expert recommended brands in the Oral health, Pain relief, Respiratory, Skin health, Nutrition and Digestive categories. £7.7bn, +2% CER Sales turnover 2018 Key brands Sensodyne Oral health Voltaren Pain relief Panadol Pain relief Novamin, a key technology in Sensodyne Repair and Protect 3 long-term priorities Innovation Performance Trust We invest in scientific and We aim to achieve industry- We commit to use our science technical excellence to develop leading growth by investing and technology to address and launch a pipeline of new effectively in our business, health needs, make our products products that meet the needs of developing our people and affordable and available and to patients, payers and consumers. delivering flawlessly. be a modern employer. Culture 8 2018: delivered improved operating performance and reshaped portfolio Pipeline strengthening New leadership and with increased oncology culture Innovation focus Business Development – Focus on launch Tesaro, 23andMe, execution Merck† alliance Performance Restructuring Pharma Divestment of non-core business assets New R&D approach with Buy out of Novartis Trust a focus on immunology, stake; proposed new genetics and technology Consumer JV with Pfizer* 9 † Transaction with Merck KGaA, Darmstadt, Germany expected to close Q1 2019 * Transaction to create the JV is expected to close in the second half of 2019, subject to approvals 2019: focus on delivering business priorities 2019 focus New global Innovation Pharmaceuticals and • Strengthen pipeline • Execution of launches Vaccines company with R&D focused on science of the – Drive operating immune system, genetics and advanced technologies performance Performance • Driving growth and operating performance – Progress • Plan for the integration of Pfizer consumer pipeline health business – Successful integration New world-leading Consumer Healthcare Trust company with category • Regular updates on innovation leading power brands and • Global health focused for impact science based innovation • Modern employer 10 Pharmaceuticals Pharmaceuticals: revenue breakdown 2018 Revenues of £17.3bn (+2% CER) Therapy Areas Regions Respiratory (+1%) Europe (+1%) £4.1bn £6.9bn (24%) HIV (+11%) (40%) £4.7bn (27%) US (+1%) £7.5bn (43%) £0.5bn (3%) £5.7bn Immuno-inflammation (+28%) (33%) £5.1bn (30%) International (+5%) Established Pharmaceuticals (-4%) Source: GSK Full year 2018 results release – February 2019 12 All growths at constant exchange rates (CER). Breakdown percentages are approximate Increasing focus and prioritisation to support future growth Focus resources on key Investing in priority Building our capability in products markets Specialty Trelegy US New talent with Specialty experience Nucala China Co-location of development HIV and commercial in Oncology Zejula Tesaro transaction Shingrix Changes to our policy for working with healthcare Bexsero professionals 13 Transaction with Tesaro accelerates GSK’s oncology presence Leading PARP inhibitor for Immediate Oncology Complements ongoing ovarian cancer infrastructure GSK build in oncology Zejula Quarterly Sales ($m) Solid tumour field force, with Catalyst for broader change 73 ~250 sales representatives in 63 64 54 49 US and major EU markets Lifecycle combinations eg ICOS 43 39 26 Oncology focused infrastructure Talent acquisition (eg regulatory, payer Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 management) Leading position in 2nd line maintenance therapy of ovarian cancer OC market evolving rapidly 14 Emerging Markets: focus on nine key markets and simplifying the business model New Export 9 key markets Clustering smaller markets business model Two thirds of sales 25% of sales <10% of sales Strong growth potential Solid growth potential Limited near term growth potential Investing in customer facing Optimising back office support Distribution model to improve resource profitability China Brazil India LSP North Africa CIS Africa Mexico Argentina Turkey CARICAM EM EAST Middle East Export Russia GCC Pakistan Colombia Asia DC LSP = Latina South Pacific (Chile, Peru, Ecuador) EM East = Vietnam, Philippines, Thailand, Malaysia, Sri Lanka 15 Asia DC = Bangladesh, Laos, Papua New Guinea, Myanmar, Cambodia Respiratory Respiratory: revenue breakdown 2018 Revenues of £6.9bn (+1% CER) Products Regions Seretide/Advair (-21%) £2.4bn Europe (+4%) (35%) £1.5bn (22%) US (-3%) £3.4bn Other £1.9bn (49%) (27%) £2.0bn £2.0bn £0.6bn (30%) (29%) (8%) International (+7%) Nucala (+66%) Ellipta portfolio (+32%) Source: GSK Full year 2018 results release – February 2019 17 All growths at constant exchange rates (CER) . Breakdown percentages are approximate The changing shape of the respiratory portfolio New portfolio offsetting decline in Advair/Seretide 5,741 6,510 6,991 6,928 100% 6% 5% 8% Nucala 15% 23% 32% 30% Ellipta portfolio 28% 23% 16% Advair US 32% 25% 22% 19% Seretide RoW 30% 30% 28% 27% Other 2015 2016 2017 2018 Growth CER -7% +2% +3% +1% Source: GSK Full year 2015, 2016, 2017 and 2018 results releases – February 2016, February 2017, February 2018 and February 2019 18 New portfolio provides platform for continued market leadership • Relvar/Breo Ellipta™ inhaler approved & launched • Anoro Ellipta™ inhaler approved