Passion for life 2020 Annual Report This is Getinge Q Introduction CONTENTS Introduction Passion for life This is Getinge 1 Global value creation 2 Sometime in life, we all need to seek health care. At The year in brief 4 Getinge, we have a long tradition of creating innovations CEO Interview 6 that improve people’s quality of life – and save lives. We Trends and business drivers 8 think it is the most important job in the world. Strategy Targets 12 Strategy for sustainable growth 14 Sustainability framework 18 Operations Market overview & sales 31 Acute Care Therapies 34 Life Science 38 Surgical Workflows 42 Annual Report Administration Report 47 Corporate Governance Report 56 Board of Directors 69 Getinge Executive Team 72 Guidelines for remuneration 74 Remuneration Report 79 Proposed appropriation of profit 82 Group Financial statements 83 Notes 88 Parent Company Financial statements 120 Notes 124 Auditor’s report 131 Other information Sustainability notes 136 GRI index 147 The Getinge share 150 Multi-year overview 152 Group companies 158 Definitions 162 Getinge adds value to THIS IS GETINGE customers’ operations in terms of The world is facing major challenges, one of which is the ability to provide 25,000 10,800 the increasing world population with safe and effective health care. We live longer and, according to WHO, lifestyle diseases such as cardiovascular Improved No. of customers No. of employees in the company diseases are one of the primary causes of death globally. clinical outcomes Getinge is committed to ensuring that all people and societies have access to the best possible health care. The company supports its customers Improved Improved in meeting their challenges in health care and life science institutions by 90% SEK 29.8 bn effectiveness safety providing knowledge, technology and resources to achieve optimal clinical outcomes and, ultimately, to save lives. of sales are made to hospitals Net sales 2020 Every care has been taken in the translation of and 10 % to pharma companies this Annual Report. In the event of discrepancies, and research institutes the Swedish original will supersede the English translation. Cover photo: Picture photographed by Dana Yamini, specialist nurse at a hospital in Stockholm , Sweden and photographer. 2020 ANNUAL REPORT 1 Introduction Q Global value creation Global value creation Q Introduction Creating shared value Getinge’s role is to provide value to its various stake­ HOW GETINGE CREATES VALUE FOR CUSTOMERS AND OTHER STAKEHOLDERS holders. Customers’ operations and business should result in better health care to more patients and thereby also create value for society. 3 Capitalize on having one Quality Culture truly global brand VISION 4 Environmental & Social Capture global To become the world’s most respected and Engagement trusted medical device company growth 2 Top priority MISSION Business Ethics Secure leadership QUALITY RESPONSIBILITY & Responsible Getinge provides innovative products and solutions by strengthening AND SUSTAINABILITY Strategic Enablers AND CULTURE Leadership that enable better patient outcomes while enhancing the offering Build a proud global health economics organization with engaged and performance driven people VALUES Passion is at the heart of our values 1 Drive productivity Passionate and efficiency employees enhancement Focus areas 1–4 areas Focus Collaboration DELIVERING VALUE FOR OUR STAKEHOLDERS Ownership Openness Getinge enables better health care in hospitals and in pharmaceutical development and production. Getinge also contributes with value to society at large. Customers Society Getinge’s top priority is to have satisfied customers. Contributing Getinge is proud to contribute to better health care in a productive way Excellence positively to customers’ operations will improve customer loyalty and as this is key for society. Getinge is also contributing to society indirectly, lead to better business results for Getinge. The performance of Getinge’s through collaborations with organizations and universities. business recent years shows that the company is on the right path. 9.9% 125 BUSINESS AREAS Compounded annual sales growth 2018–2020 Getinge’s products were sold in 125 countries 2020 Partners Employees ACUTE CARE LIFE SURGICAL THERAPIES SCIENCE WORKFLOWS Cooperation with other experts is needed to achieve success. For Getinge’s future and ability to create value for the other stakeholders, example, Getinge managed to increase ventilator production capacity depends on the ambition and passion of its employees, and in how by 160% in a short period of time in 2020, thanks to strong collaboration Getinge utilizes this. with partners. 26,700 72% Number of ICU ventilators produced in 2020 Employee commitment, PULSE surveys (target: >70%) 2 2020 ANNUAL REPORT 2020 ANNUAL REPORT 3 Introduction Q The year in brief The year in brief Q Introduction Increasing ECLS production capacity Anna Romberg new member 2020 in brief In June, Getinge decided to increase the production output of of the Executive Team ECLS (Extra Corporeal Life Support) devices due to strong demand In September, Anna Romberg related to COVID-19. was appointed Executive Vice President Legal, Compliance & Governance and member of the Getinge Executive Team. Getinge to become a CO₂ neutral company by 2025 In July, Getinge announced its intention to become a CO₂ Getinge to Ramping up production in DPTE® BetaBags neutral company by 2025. The need for DPTE® BetaBags has increased significantly due to The target will be reached become COVID-19 and subsequent efforts to develop and manufacture by a stepwise approach in vaccines. The increased demand is expected to persist for the several areas and supports CO₂ neutral foreseeable future and Getinge has gradually increased capacity the company’s objective to in the existing production unit in France in 2020. In addition, a contribute to a sustainable by 2025 decision was made in the fourth quarter to establish production in health care environmentally Acquisition of Applikon Bio technology finalized Getinge Online was launched the US, at Getinge’s factory in Merrimack, New Hampshire, where as well as socially. In January, Getinge completed the acquisition of Applikon Getinge introduced one of its latest connectivity solutions for acute production is expected to start at the end of 2021. Biotechnology, a leading company in the development and supply care products. The digital platform Getinge Online enables hospitals to of advanced bioreactor systems for the research and production of improve efficiency by using product data to gain insights and maximize vaccines and antibodies in the biopharmaceutical industry, as well uptime. Of the acute care products, the first ones to be connected to 510(k) clearance from US FDA for as enzymes and bio-plastics for industrial biotechnology. the new portal are the Getinge Flow Family anesthesia machines. Servo-airR, Flow-e and Flow-c Acquisition of Quadralene Getinge received a 510(k) clearance from the US Food & In November, Getinge acquired Quadralene, a global expert and Drug Administration (FDA) for both the company’s Servo-airR manufacturer of consumables like disinfectants for sterilization. mechanical ventilator, as well as the Flow-e and Flow-c The acquisition of Quadralene enables Getinge to more effec- Production ramp-up of Getinge issued COVID-19 commercial paper Anesthesia Systems. The latter two, share the same Flow Family tively add value to customers in their important efforts to reduce advanced ICU-ventilators In April , Getinge issued a SEK 1 billion COVID-19 commercial paper core technology and offers personalized anesthesia delivery for hospital- related infections. To meet the rapidly increas- in line with the ICMA Social Bond Principles. The commercial paper even the most challenging patients, from neonates and pediatric ing demand for advanced was exclusively allocated to finance the production increase of to the morbidly obese. ICU- ventilators, Getinge ventilators and other capital needs to expand the production of Launch of Solsus 66 steam sterilizer announced a year-end target life saving equipment to meet rising demand due to the COVID-19 Getinge’s launched a new steam sterilizer, Solsus 66 in the fourth to produce 26,000 ventilators. pandemic. The commercial paper also supported Getinge’s sus- quarter. It is a sustainable and energy efficient steam sterilizer that The 160% production ramp tainablility work to contribute to increased value for customers and Multi-center trial meets the needs of hospitals seeking a balance between capacity up was met during Q4 2020, society at large. shows significant and cost efficiency in the Central Sterile Supply Department thanks to strong team work benefits with NAVA (CSSD). The launch comes at a time when hospitals face both and partnerships with various The results of an independent % 35 operational and financial challenges as a result of the COVID-19 companies such as Scania, multi-center trial showed pandemic. Ericsson and Volvo. Showcasing the Quiet ICU that through the use of Together with other leading industry partners, Getinge showcased NAVA (Neurally Adjusted innovative connectivity solutions for creating a more quiet and Ventilatory Assist), the days healing environment for the intensive care unit (ICU). By distributing on mechanical ventilation audible alarms outside patient rooms, ICUs will become calmer for could be reduced from 12 patients, family members and provide caregivers a more efficient to 8 for adult ICU-patients. way of addressing alarms. This equals close to a 35% reduction which is quite a remarkable improvement. Q1 Q2 Q3 Q4 Q1 Financial development: Q2 Financial development: Q3 Financial development: Q4 Financial development: Net sales increased organically by 3.8% and adjusted EBITA Net sales increased organically by 9.1% and adjusted EBITA Net sales increased organically by 33.4% and adjusted EBITA Net sales increased organically by 11.1% and adjusted EBITA amounted to SEK 661 M (369). Adjusted earnings per share amounted to SEK 1,218 M (591). Adjusted earnings per share amounted to SEK 2,028 M (677). Adjusted earnings per share amounted to SEK 1,817 M (1,673).