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03 The Global Diabetes Care Market CMD2011
03 The Global Diabetes Care Market CMD2011
5 May 2011
5 May 2011
Slide no 2
Forward-looking statements
Novo Nordisks reports filed with or furnished to the US Securities and Exchange Commission (SEC), including the companys Annual Report 2010 and Form 20-F, both expected to be filed with the SEC in February 2011 as well as this document and written information released, or oral statements made, to the public in the future by or on behalf of Novo Nordisk, may contain forward-looking statements. Words such as believe, expect, may, will, plan, strategy, prospect, foresee, estimate, project, anticipate, can, intend, target and other words and terms of similar meaning in connection with any discussion of future operating or financial performance identify forward-looking statements. Examples of such forward-looking statements include, but are not limited to: - statements of plans, objectives or goals for future operations, including those related to Novo Nordisks products, product research, product development, product introductions and product approvals as well as cooperations in relation thereto, - statements containing projections of or targets for revenues, income (or loss), earnings per share, capital expenditures, dividends, capital structure or other net financials, - statements regarding future economic performance, future actions and outcome of contingencies such as legal proceedings, and - statements regarding the assumptions underlying or relating to such statements. These statements are based on current plans, estimates and projections. By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific. Novo Nordisk cautions that a number of important factors, including those described in this document, could cause actual results to differ materially from those contemplated in any forward-looking statements. Factors that may affect future results include, but are not limited to, global as well as local political and economic conditions, including interest rate and currency exchange rate fluctuations, delay or failure of projects related to research and/or development, unplanned loss of patents, interruptions of supplies and production, product recall, unexpected contract breaches or terminations, government-mandated or market-driven price decreases for Novo Nordisks products, introduction of competing products, reliance on information technology, Novo Nordisks ability to successfully market current and new products, exposure to product liability and legal proceedings and investigations, changes in governmental laws and interpretation thereof, including on reimbursement, intellectual property protection and regulatory controls on testing, approval, manufacturing and marketing, perceived or actual failure to adhere to ethical marketing practices, investments in and divestitures of domestic and foreign companies, unexpected growth in costs and expenses, failure to recruit and retain the right employees and failure to maintain a culture of compliance. Please also refer to the overview of risk factors in Risk management of the Annual Report 2010 available as of 4 February 2011 on the companys website (novonordisk.com). Unless required by law Novo Nordisk is under no duty and undertakes no obligation to update or revise any forward-looking statement after the distribution of this document, whether as a result of new information, future events or otherwise.
5 May 2011
Slide no 3
Capital markets expect diabetes care to continue to outgrow the general pharmaceutical industry
Growth in global prescription sales versus diabetes care sales (CAGR)
Total Prescription sales Diabetes Care sales Insulin and GLP-1 sales
2000-2005
2005-2010
2010-2015
5 May 2011
Slide no 4
OAD
Insulin
GLP-1
350 300
250
100 80 60 40 20
CAGR 14.3%
150 100
CAGR 7.8%
Feb 2006
Note: Monthly MAT, value figures Source: IMS
50 0
34%
Feb 2006
Long acting
36%
Feb 2011
Feb 2011
5 May 2011
Slide no 5
The fundamental growth drivers of the insulin market Volume Prevalence of diabetes Diagnosis rates and treatment rates Intensification of insulin regimens Growing BMI Life-length
86.7 bDKK
80
60
40
20
0 MAT Feb 2006 Volume contribution Mix/price contribution MAT Feb 2011
5 May 2011
Slide no 6
Globally, diabetes has become an epidemic - driven by lifestyle changes and demographics
Estimated number of people with diabetes projections appear conservative
Million people
CAGR: 2.2%
439
151
JP, Korea Europe
China Japan Europe North America
50%
25% 12%
2000
2010
N. America 2030
//
Source: International Diabetes Foundation: Diabetes Atlas, 2000 and 2009 Note: Data covers the 20-79 age-group. IO: International Operations, Japan includes Korea
5 May 2011
Slide no 7
80% 70% 60% 50% 40% 30% 20% 10% 0% 1970 1980 1990 2000 2010 2020
Adapted from: Sassi, F. et al. 2009 The Obesity Epidemic: Analysis of Past and Projected Future Trends in Selected OECD Countries, OECD Health Working Papers, No. 45, OECD Publishing. Available at: http://www.ecoclimax.com/2010/10/past-and-projected-future-overweight.html
5 May 2011
Slide no 8
Life expectancy has on average risen by 4 months each year since 1970
Life expectancy at birth (weighted average)
69 years 56 years
1970
2010
5 May 2011
Slide no 9
Life expectancy has on average risen by 4 months each year since 1970
Life expectancy at birth (weighted average)
1970
2010
2050
5 May 2011
Slide no 10
238
264
Sources: Calculation based on IMS volume figures and United Nations Population Division demography data
5 May 2011
Slide no 11
Modern insulin is replacing human insulin as human insulin replaced animal insulin
Share of total insulin volume
100%
80%
Modern insulin
60%
Human insulin
40%
20%
0% 1994
Animal insulin
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
5 May 2011
Slide no 12
Modern insulin constitute more than 80% of the total insulin value market
Share of total insulin value
100%
80%
Modern insulin
60%
40%
20%
0%
1994
5 May 2011
Slide no 13
Prefilled device
80%
60%
Durable device
40%
0% 1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
5 May 2011
Slide no 14
Significant growth
Complex to be competitive
5 May 2011
Slide no 15
5 May 2011
Slide no 16
74 years
8 years 54 years
OAD treatment
Sources: Calvert MJ, McManus RJ, Freemantle N (2007) Management of type 2 diabetes with multiple oral hypoglycaemic agents or insulin in primary care retrospective cohort study Br J Gen Pract 57: 455-60. The British Journal of Diabetes & Vascular Disease 2008 8:92. 2005 -2008 National Health and Nutrition Examination Survey. http://www.newsobserver.com/2011/03/03/1025677/type-2-diabetes-linked-to-shorter.html#storylink=misearch. Lifeexpectancy in Individuals with type 2 Diabetes, Diabetes (2007); 56: (supp1): A596
5 May 2011
Slide no 17
Novo Nordisk has significant operations across the world to remain competitive
FTEs represent full-time employee equivalents in Novo Nordisks sales regions (excludes a.o. employees in headquarter and manufacturing)
5 May 2011
Slide no 18
Fermentation
Recovery
Purification
Formulation
Filling
Assembly
Packaging
5 May 2011
Slide no 19
API production Formulation & filling Assembly Packaging Device & needle manufacturing
Denmark
Clayton
Chartres
Tianjin
Koriyama
Packaging
Montes Claros
Formulation & filling Assembly Packaging
5 May 2011
Slide no 20
70% 60%
23% 22% 4%
Feb 2006 Feb 2011
1%
0%
Feb 2006 Feb 2011
0%
5 May 2011
Slide no 21
30%
46% 34%
20%
19%
19%
10%
10%
1%
0%
Feb 2006 Feb 2011
3%
0%
Feb 2006 Feb 2011
5 May 2011
Slide no 22
14% 9% 6%
10%
0%
Feb 2006
Feb 2011
5 May 2011
Slide no 23
Novo Nordisk is now also expanding into earlier treatment and growing the GLP-1 class
Victoza is driving the expansion of the global GLP-1 market
GLP-1 sales in bDKK (right axis)
5%
4%
Victoza
3%
26%
4 3
2%
72%
exenatide
1%
2 1
North America
0%
Feb 2006
0 Feb 2011
*Annual value of diabetes market MAT February 2011 Source: IMS, Monthly value data (DKK)
5 May 2011
5 May 2011
Slide no 25
Outline
The diabetes challenge Treatment of diabetes today Victoza performance Insulin market performance Focus areas and priorities
5 May 2011
Slide no 26
<6%
6-7%
8-9%
10-11%
12-13%
14-15%
16-17%
18-19%
Note: Improvements in therapies and medical management over time are factored in. Sources: CDC Behavioral Risk Factor Surveillance System; Narayan, Impact of Recent Increase in Incidence on Future Diabetes Burden, Diabetes Care 2006;29:2114-2116; Boyle, Projection of the year 2050 burden of diabetes in the US adult population, http://www.pophealthmetrics.com/content/8/1/29; Institute for Alternative Futures projections
5 May 2011
Slide no 27
Associated costs of diabetes represent a significant and increasing economic burden for society
Total annual direct medical and indirect societal costs of diabetes (billion USD) 2010: 299 bUSD 2015: 374 bUSD 2025: 514 bUSD
<1b
1-2.9b
3-4.9b
5-9.9b
10-14.9b
15-24.9b
>25b
Sources: CDC Behavioral Risk Factor Surveillance System; Narayan, Impact of Recent Increase in Incidence on Future Diabetes Burden, Diabetes Care 2006;29:2114-2116; CDC, 2010 National Diabetes Fact Sheet; Boyle, Projection of the year 2050 burden of diabetes in the US adult population, http://www.pophealthmetrics.com/content/8/1/29; Institute for Alternative Futures projections
5 May 2011
Slide no 28
DPP-4s 80%
Note: Insulin data include treatment with concomitant non-insulin products Source: IMS LRx Monthly Regime, 12/10 PROJECTED to Mattson Jack, NHANES IV and Ropers 2010
5 May 2011
Slide no 29
In the US, the insulin market is outgrowing the overall diabetes care market
US diabetes care market by treatment class
DKK billion 120 OAD Insulin GLP-1 tMU
120
100
100
80
80
60
60
40
CAGR 18.9%
40
20
CAGR 5.6%
Feb 2006 Feb 2011
20
Long acting
Feb 2006 Feb 2011
5 May 2011
Slide no 30
250
5%
200
Victoza
4%
3
150
3%
2
SU met Metformin
100
exenatide
2%
64%
50
1%
Nave
0
Mar 2010
Mar 2011
0%
Mar 2010
Mar 2011
Note: Nave is defined as all patients who have not filled a prescription in 12 months Source: IMS, NPA Monthly data; IMS LRx 4 week average Naive and Switch/Add Script Counts
5 May 2011
Slide no 31
Volume growth and value upgrade drive insulin market value expansion
US insulin value market growth
DKK billion 60 Penetration of total market 80%
70% 60%
Value upgrade
73%
50
40
18.5 bDKK
30 20
9.0 bDKK
Device penetration
27%
10 0
19.9 bDKK
47.4 bDKK
20% 10% 0%
Mix/price growth
February 2011
Feb 2006
Feb 2011
5 May 2011
Slide no 32
Sanofi-Aventis
Eli Lilly
42% 32%
30%
26%
20% 10% 0%
Feb 2006
Feb 2011
Feb 2006
Feb 2011
5 May 2011
Slide no 33
44% 37%
42%
40% 30% 20% 10% 0%
37% 21%
19%
Feb 2006
Feb 2011
Feb 2006
Feb 2011
5 May 2011
Slide no 34
100%
100%
Premix segment
100%
80%
80%
80%
60%
60%
60%
40%
40%
40%
20%
20%
20%
0%
Feb 2006
Feb 2011
0%
Feb 2006
Feb 2011
0%
Feb 2006
Feb 2011
5 May 2011
Slide no 35
5 May 2011
5 May 2011
Slide no 37
Source: IMS Health MIDAS, Market Prognosis October 2009. Market size ranking in constant USD
5 May 2011
Slide no 38
Ageing population
5 May 2011
Slide no 39
2010 2030
80
87
80
64
60
51 44
60
40
40
30%
24% 3%
20
8
0
13
10
10
20
0
Brazil Russia India China
Diagnosed diabetics
Treated diabetics
Source: International Diabetes Foundation: Diabetes Atlas, 2000 and 2009 Note: Data covers the 20-79 age-group. IO: International Operations, Japan includes Korea
5 May 2011
Slide no 40
5 May 2011
Slide no 41
Novo Nordisk is the company with the largest focus on diabetes care in China
A total of 3,375 employees across Commercial operations in China Manufacturing R&D Hong Kong Taiwan
Heilongjiang Jilin Xinjiang Gansu Inner Mongolia Changchun
Tibet
Liaoning Beijing Shenyang Tianjing Hebei Ningxia Qinghai Shanxi Jinan Shandong Shanxi Henan Jiangsu Shanghai Hubei Chongqing Anhui Sichuan Wuhan Zhejiang Guizhou Hunan Jiangxi Yunnan Guangxi Guangdong Fujian Guangzhou Taiwan Hong Kong
Hainan
5 May 2011
Slide no 42
The Chinese insulin market is expanding significantly predominately driven by the premix segment
Chinese diabetes care market by treatment class by value
DKK billion 6 OAD Insulin GLP-1 tMU
24
20
16
4
12
Fast acting
CAGR 38.8%
64% 33%
Premix
CAGR 27.8%
1
Feb 2006
Feb 2011
Long acting
Note: Monthly MAT, value figures. IMS projects the Chinese market based on hospital data from 14% of Chinese hospitals Source: IMS
Note: *in DKK. Monthly MAT, volume figures. IMS projects the Chinese market based on hospital data from 14% of Chinese hospitals Source: IMS
5 May 2011
Slide no 43
63%
30%
50% 40%
20%
15%
10%
30% 20%
9% 6%
13%
10% 0%
0%
4%
Feb 2011 Feb 2006
12% 5% 4%
Feb 2011
Feb 2006
Source: IMS Monthly MAT, value figures. IMS projects the Chinese market based on hospital data from 14% of Chinese hospitals
Source: IMS Monthly MAT, volume figures. IMS projects the Chinese market based on hospital data from 14% of Chinese hospitals
5 May 2011
Slide no 44
90%
76%
74%
17% 6%
Feb 2011
20% 10% 0%
Feb 2006
17% 8%
Feb 2011
5 May 2011
Slide no 45
and maintaining a very solid leadership position in the modern insulin market
Modern insulin value market share
Novo Nordisk Sanofi-Aventis BJ Ganli Pharm
Eli Lilly
Eli Lilly
69%
53%
60% 50%
32%
8% 6%
Feb 2011
10% 0%
Feb 2006
15% 11% 4%
Feb 2011
5 May 2011
Slide no 46
5 May 2011
Closing remarks
Kre Schultz COO
5 May 2011
Slide no 48
Diabetes
Degludec* DegludecPlus*
IDegLira* FIAsp*
*Note: Degludec is the internal designation for insulin degludec. DegludecPlus is the internal designation for insulin degludec/insulin aspart. IDegLira is the internal designation for insulin degludec/liraglutide. FIAsp is the internal designation for fast acting insulin aspart.
5 May 2011
Slide no 49
Capital markets expect diabetes care to continue to outgrow the general pharmaceutical industry
Growth in global prescription sales versus diabetes care sales (CAGR)
Total Prescription sales Diabetes Care sales Insulin and GLP-1 sales
2000-2005
2005-2010
2010-2015