Good afternoon, I’m sungmin ahn and My group consists of THACH THAO

PHAM and me. To get started, I want to thank you for taking time to

announce our group’s output today.

From now on, I would like to share with you about Key performance

indicators for the pharmaceutical industry, a megatrend growth industry

due to aging population, covid 19 etc.

According to OPS dog, a KPI-related data specialized company, five KPI of

pharmaceutical companies are presented. Among them, I would like to

intensively discuss R&D and prescription data.

Let's look at the prescription data first. Prescription is a familiar concept to

us. Simply looking at the drug sales structure, pharmaceutical companies

usually sell drugs to wholesalers or retailers, and the drugs sold are

supplied to patients through prescription activities at hospitals or

pharmacies.

In summary, Prescription data is information about the provision of drugs

to patients in hospitals or pharmacies, and refers to sales information

about patients who are real customers from the pharmaceutical company's

point of view.

Recently, Celltrion's second-quarter earnings IR materials are thought to be

a good example of how actual companies use prescription data. Celltrion

explains that its market share increases as prescriptions for major biosimilar

products increase in the U.S. and Japan.

The company monitors prescription data and uses it for marketing strategies
such as lowering sales prices in areas with poor sales, or analyzes the market
share of competitors

So, how can we get these important prescription data?

Prescription data is usually provided by global pharmaceutical data companies such as IQVIA,
Symphony Health and bloomberg, analyst report. Data mainly includes sales
volume and sales amount by region.

Then, I will talk about R&D data from now on. According to data from the
U.S. Congressional Budget Office, pharmaceutical companies have the
largest R&D intensity in the U.S.

How should we analyze R&D data? First of all, quantitatively, we can think
of the return on research capital ratio. This ratio examines how much profit
the pharmaceutical company has made from its past R&D expenses.

This ratio is calculated by dividing the current gross profit by the previous
year's R&D expenses. When looking at J&J and Pfizer, the leading
pharmaceutical companies in the United States, J&J shows slightly higher
figures than Pfizer.

However, as we learned in class, we need to consider the Accounting GAAP

difference when calculating the ratio. In other words, R&D expenses treated
as assets should also be taken into account so that accurate ratio
calculations and company comparisons can be made. In this way, we could
obtain the RORC ratio for J&J, Roche, and Celltrion.
Finally, it is necessary to review the share of the company's total R&D cost
before phase 2 clinical trials. Since the risk of failure is usually the highest
in phase 2 clinical trials, it is necessary to conservatively evaluate the future
profit-generating capacity of R&D costs before phase 2 clinical trials.