Final results. For the year ended 31 March 2017

Transcription

1 Final results For the year ended 31 March 2017

2 Forward-looking statements This presentation and information communicated verbally to you may contain certain projections and other forward-looking statements with respect to the financial condition, results of operations, businesses and prospects of BTG plc ( BTG ). These statements are based on current expectations and involve risk and uncertainty because they relate to events and depend upon circumstances that may or may not occur in the future. There are a number of factors which could cause actual results or developments to differ materially from those expressed or implied by these forward-looking statements. Any of the assumptions underlying these forwardlooking statements could prove inaccurate or incorrect and therefore any results contemplated in the forward-looking statements may not actually be achieved. Investors or other recipients are cautioned not to place undue reliance on any forward-looking statements contained herein. BTG undertakes no obligation to update or revise (publicly or otherwise) any forward-looking statement, whether as a result of new information, future events or other circumstances. Neither this presentation nor any verbal communication shall constitute an invitation or inducement to any person to subscribe for or otherwise acquire securities in BTG BTG International Ltd. All rights reserved. See More, Reach Further, Treat Smarter, Imagine where we can go, BTG and the BTG roundel logo are trademarks of BTG International Ltd. DC Bead, DC Bead LUMI, LC Bead LUMI and LUMI are trademarks and/or registered trademarks of Biocompatibles UK Ltd. EKOS is a trademark of EKOS Corporation. Galil is a trademark of Galil Medical Ltd. PneumRx is a trademark of PneumRx, Inc. TheraSphere is a trademark of Theragenics Corporation used under license by Biocompatibles UK Ltd. Varithena is a trademark of Provensis Ltd. CroFab and DigiFab are trademarks of BTG International Inc. Vistogard is a trademark of Wellstat Therapeutics Corporation. Voraxaze is a trademark of Protherics Medicines Development Ltd. Lemtrada is a trademark of Genzyme Corporation. Zytiga is a trademark of Johnson & Johnson. Biocompatibles UK Ltd, EKOS Corporation, Galil Medical Ltd, PneumRx, Inc., Protherics Medicines Development Ltd, and Provensis Ltd and are all BTG International group companies. 2 Not all products and/or indications are available in all territories. For prescribing information, safety information, and/or product information, go to: btg-im.com crofab.com digifab.us ekoscorp.com galilmedical.com lemtrada.com pneumrx.com therasphere.com varithena.com vistogard.com voraxaze.com

3 A proven strategy delivering sustained double-digit product sales growth Strong financial performance Excellent strategic position Scalable platform now delivering Well placed to achieve additional growth Double-digit product sales growth Interventional Medicine (IM) is the biggest and fastest growing contributor to revenues High-value therapies in attractive markets Platform for sustained growth in Interventional Medicine Significant milestones achieved in 2016/17 Multiple drivers of growth: existing product portfolio and pipeline Rich opportunity in Interventional Medicine Financial strength, therapy knowledge and capabilities to make the right investments 3

4 Financial results Rolf Soderstrom 4

5 Strong product sales and operating profit growth delivered in 2016/ /17 ( m) 2015/16 ( m) Actual % CER 1 % Product Sales % +19% Royalties % (3%) Revenues % +11% Adjusted Operating Profit % +13% Adjusted Operating Profit Margin 23% 21% +2ppts Adjusted Basic EPS p 21.9p +5% Free Cash Flow % 5 1 Constant exchange rate ( CER ) growth is computed by restating 2016/17 results using 2015/16 foreign exchange rates for the relevant period. 2 Further detail on the adjustments to IFRS financial measures is included in the preliminary announcement. 5

6 Product sales growth up 19% at CER driven by Interventional Medicine +16% +20% 1 +22% >100% (36%) +12% 387.3m +19% at CER 283.3m IM +15% at CER (organic) IM +25% at CER (incl. Galil Medical) (+14% CER organic) +19% at CER /16 FX 2015/16 CER TheraSphere/ Beads Galil EKOS Varithena PneumRx SP 2016/ Pro forma sales growth for the 12 months to 31 March 2017, including sales prior to BTG s ownership

7 Double-digit product sales growth driven by IO and EKOS, with strong Spec Pharma underpin 2016/17 ( m) CER Drivers of 2016/17 performance High Growth IM - TheraSphere /Beads % TheraSphere growth in US and EU - GALIL % 1 Increased patient procedures globally - EKOS % Penetration in US hospitals and treatment of PE % (+18% organic) Early Stage IM - Varithena 4.1 >100% Targeted marketing and market access initiatives - PneumRx Coils 9.1 (36)% Lower number of procedures in Germany Total IM % (+15% organic) Specialty Pharmaceuticals % DigiFab growth and increased oncology sales Product Sales % (+14% organic) 7 1 Pro forma sales growth for the 12 months to 31 March 2017, including sales prior to BTG s ownership 7

8 Royalties performance in 2016/17 benefited from last full year of Lemtrada Continued good contribution from Zytiga No generic entrant expected before October 2018 Strong Lemtrada royalties in last full year before expiration: EU royalties ceased in March 2017 US royalties cease in September /17 ( m) 2015/16 ( m) Actual % Zytiga % (10%) 1 Lemtrada % 67% Other royalties (18%) (24%) Royalties % (3%) CER % Continued good contribution from Zytiga No generic entrant expected in the US before October 2018 and Europe before 2021 Strong Lemtrada royalties in last full year before licence expiration: EU royalties ceased in March 2017 US royalties will cease in September Excluding back royalties of 8.5m received in 2015/16, Zytiga was -3% at CER year on year. 8

9 Recent investment has built a platform for delivery of sustained growth All m Interventional Medicine Specialty Pharmaceuticals Investment in IM commercial capabilities ahead of anticipated growth Spec Pharma continues to provide strong financial underpin Licensing Revenues Contribution from Licensing to gradually decline as royalties drop off Adjusted gross profit Gross margin 72% 90% 45% Adjusted SG&A Contribution Contribution margin 17% 71% 31% Investment in IM commercial capabilities ahead of anticipated growth Spec Pharma continues to provide strong financial underpin Contribution from Licensing to decline over time as royalties drop off 9 1 Further detail on the adjustments to IFRS financial measures is included in the preliminary announcement. 9

10 Investment in innovation and development to drive sustained growth 15.6m (18%) 20% 2016/17 R&D Product innovation: IO portfolio innovation New EKOS control unit Digital Innovation 33.1m 39% (37%) 39.1m (45%) 41% Clinical trials and studies: TheraSphere Phase III trials EKOS (ACCESS PTS & OPTALYSE) GALIL Lung and Bone cancer studies PneumRx PMA filing Investment of 87.8m in 2016/17, broadly flat to 2015/16 at CER Education & product enhancement: Medical and Regulatory affairs Post-approval commitments Investigator Initiated Studies (IIS) 10

11 Robust free cash flow and funding position 2016/17 ( m) 2015/16 ( m) Actual % Free Cash Flow prior to DOJ settlement % DOJ settlement (28.0) - n/a Free Cash Flow (27%) Acquisition of Galil Medical (55.1) - Other investing and financing (0.4) (22.4) Net Cash Flow Cash and cash equivalents of 155.5m at 31 March 2017 Strong and flexible funding position, with facility of up to 200m currently undrawn 11

12 . 2017/18 outlook Reiterating expectations of double-digit product sales growth 2017/18 CER guidance 1 Product sales Interventional Medicine mid-to-high teens (%) growth Royalties Specialty Pharmaceuticals low-to-mid single digit (%) growth high teens (%) decline Gross margin increasing to 72% 74% Adjusted SG&A and R&D mid-to-high single digit (%) increase Adjusted effective tax rate 2 increasing to 22% 26% Foreign exchange FX sensitivity for revenues and opex included in the appendix Hedging gain of 5m in 2017/18 (at the current rate of ~$1.30) The average USD/GBP rate for the year to 31 March 2017 was $ Adjusted effective tax rate is not prepared in accordance with IFRS. Further detail on the adjustments to IFRS financial measures is included in the preliminary announcement. 3 At 31 March 2017, BTG had forward contracts to sell $170m at a weighted average rate of $1.33

13 Medium-term outlook Double-digit product sales growth Enhanced gross margins Continued strong IM growth Varithena & PneumRx opportunity Sustained Spec Pharma underpin Increasing gross margin Switch to higher margin IM sales as lower margin royalties decline over time Investment to support additional growth Historical investment has built commercial platform ahead of sales Future targeted investment to support additional growth Operating margins Operational leverage expected over the medium term 13

14 Financial summary Delivery of double-digit product sales growth Revenue growth and disciplined cost control Investing in commercial expansion, R&D and acquisitions Robust financial position supporting sustained growth 14

15 Excellent strategic position Louise Makin 15

16 Developed leading, high-value therapies in attractive growing markets Indication Tumours in the liver and kidney Blood clots (DVT, PE, PAO) Severe emphysema Symptomatic varicose veins Annual Incidence* US Annual Incidence* ROW c. 75,000 c. 1m c. 1.8m patients with GOLD stages III & IV emphysema c. 250,000 c. 2-3m >4.0m patients with GOLD stages III & IV emphysema c. 2.5m c. 5m+ Current annual interventional procedures* c. 25,000 with BTG products c. 150,000 c. 1,000 with PneumRx Coils c. 750, *Company estimates US only

17 Built platform for sustained growth in Interventional Medicine Therapy leadership Understand and own, not just the product, but the condition it treats Treatment impact Understand the treatment outcomes on: - economics - patients Education Provide comprehensive internal and external education Clinical data Create data in the device space: IIS, registry, clinical studies Innovation Provide a consultative innovation partner to customers Leverage capabilities - infrastructure - technology platforms - device engineering 17

18 Interventional Oncology A unique, multi-modality customer offering Systemic Interventional Chemotherapy poison it Dual action embolisation and targeted drug delivery Ability to see precise location of beads External Beam Radiation irradiate it Targeted local delivery of radiation Ability to tailor dose to individual tumour Open surgery remove it Controlled destruction of tumour while sparing healthy tissue 18

19 Interventional Vascular EKOS : a leading technology in a growing market Unique method of action provides favourable safety/efficacy profile Uses up to 70% less thrombolytic Faster infusion time Complete clot dissolution Only device cleared in the US to treat pulmonary embolism Procedure rates growing strongly in the US Taking share of growing interventional market c.1,000,000 occurrences of VTE 1 in the US p.a. c.700,000 candidates for interventional treatment c.150,000 interventional treatments p.a c.12% CAGR in interventional treatments since Venous Thromboembolisation

20 Interventional Vascular Varithena : a patient-friendly, comprehensive treatment for varicose veins Varicose veins procedures continuing to increase in the US 15% CAGR in Medicare claims between Varithena is the only comprehensive treatment for GSV incompetence Advantages over heat ablation: Treats a wide range of vein anatomies, diameters and severity Efficacy endpoint in clinical trials include patient symptoms and appearance Broad insurance coverage in place Opportunity for Varithena to treat venous leg ulcers Number of accounts reordering Sept'14 Mar'15 Sept'15 Mar'16 Sept'16 Mar ' Source: Journal of Vascular and Interventional Radiology (April 2017)

21 Interventional Pulmonology PneumRx Coils: opportunity to lead in an emerging therapy area Interventional Pulmonology is an emerging medical discipline based around a growing medical community >4m patients in US and EU with severe emphysema High unmet need with few current treatment options Clinical data set now includes >500 patients Supports regulatory applications, reimbursement processes, physician education, inclusion in guidelines (e.g. GOLD) 21

22 22 Scalable platform now delivering

23 Important milestones achieved in 2016/17 Galil Medical acquisition Launch / approval of LUMI beads Society of Interventional Oncology collaboration Enrolment completed for EKOS OPTALYSE and ACCESS PTS studies Varithena CPT code progress PneumRx PMA accepted for review by US FDA in March 2017 PneumRx Coils included in global clinical guidelines (GOLD) 23

24 Multiple drivers to sustain double-digit product sales growth Galil studies in lung and bone metastases TheraSphere Phase III trials Continued commercial expansion in all regions EKOS OPTALYSE and ACCESS PTS study results; expansion in EU and Asia Dedicated Varithena CPT codes German and French national reimbursement decisions Potential approval and commercial launch in the US 24

25 Significant pipeline potential Active clinical trials to expand our markets Indication Product Study Detail Timing (CY) Hepatocellular Carcinoma Global Phase III trial; 520 Patients randomised (1:1) to TS followed by sorafenib vs. sorafenib; multi-centre (up to 100 sites in N. America, EU and Asia) ClinicalTrials.gov ref: NCT H2 19 Metastatic Colorectal Carcinoma Global Phase III trial; 340 Patients randomised (1:1) to TS + 2nd line chemo vs. 2nd line chemo; multi-centre (up to 100 sites in US, Canada, EU, Asia) ClinicalTrials.gov ref: NCT H1 19 Bone Metastases 510(k) labelling expansion study; 60 Patients; multi-centre (11 sites); ClinicalTrials.gov ref: NCT H2 18 Lung Metastases 130 Patients; multi-centre (10 sites); ClinicalTrials.gov ref: NCT H1 18 Pilot Study, multi-centre, 40 Patients; ClinicalTrials.gov ref: NCT H1 19 Postthrombotic syndrome ACCESS PTS ACCelerated Thrombolysis Post Thrombotic Syndrome 510(k) labelling expansion study; 70 Patients; multi-centre (22 sites); ClinicalTrials.gov ref: NCT H1 17 Pulmonary Embolism OPTALYSE PE OPTimum Acoustic Pulse ThromboLYSis ProcEdure 510(k) labelling expansion study; 90 Patients; multi-centre (19 sites); ClinicalTrials.gov ref: NCT H

26 Enhancing our product platform Supporting medical knowledge and therapy adoption IM Business Unit Interventional Oncology Product R&D Activities Ongoing ablation system improvement Post-market Renal Registry TRACE Investigator Initiated Studies Interventional Vascular Interventional Pulmonology Development of advanced dosimetry for HCC (Simplicit90Y ) Global Retrospective study underway TARGET (12 sites) Investigator Initiated Studies Microfoam canister active lifecycle management SE Asia Registrations CEAP 5/6 (Venous Leg Ulcer) post-approval Registry US PMA accepted for review by the FDA in March 2017 Developing Patient Support Tools US Registry, French Registry 26

27 Specialty Pharmaceuticals Strong cash flows supporting investment capability Acute care Oncology Building value within the medical community - SnakeBite911 app - Successful Copperhead study Strike Back education programme - Train and educate 25 physicians per session in optimising CroFab treatment Investment to expand Oncology sales team and physician education programmes New supplier partnership with Clinigen to strengthen product distribution Strong growth (+15% CER) in ROW Voraxaze for the year Good performance from Vistogard in first full year on the market 27

28 28 Well placed to achieve additional growth

29 Securing long-term leadership in Interventional Medicine therapies Macro trends favour the expanded use of image-guided, minimally invasive therapies Multiple internal and external investment opportunities: products, platforms, combinations, new organs BTG has the financial resources, therapy knowledge and capabilities to make the right investment choices 29

30 Multiple investment opportunities in Interventional Medicine therapies Smart access Local delivery Enhanced safety Value for money Precision medicine Patient friendly Themes Technology platforms Radiation Embolisation Ablation Coil and foam technology Enhanced drug delivery BTG Interventional Medicine Liver Kidney Lung Bone Neuro Vascular Prostate Pain Existing and potential therapy area targets 30

31 Interventional Oncology Immuno-oncology: an example of the growing relevance of minimally invasive therapies BTG Product Institution Immuno-therapy agent tremelimumab durvalumab Opdivo (nivolumab) Keytruda (pembrolizumab) Study Design A pilot study of immune checkpoint inhibition in combination with Trans-Arterial Catheter Chemoembolization (TACE), radiofrequency ablation or cryoablation in subjects with Hepatocellular Carcinoma or Biliary Tract Carcinomas ClinTrials.gov ref: NCT Study of a monoclonal antibody against PD-1 in combination with TheraSphere in patients with advanced Hepatocellular Carcinoma ClinTrials.gov ref: NCT Phase I/II study of dendritic cell therapy delivered intratumorally after cryoablation and anti-pd-1 antibody for patients with Non-Hodgkin Lymphoma ClinTrials.gov ref: NCT

32 Creating sustained shareholder value Strong financial performance Excellent strategic position Scalable platform now delivering Well placed to achieve additional growth 32

33 33 Questions

34 34 Appendix

35 Revenue by product 2016/17 ( m) 2015/16 ( m) Growth % CER growth % Interventional Medicine Interventional Oncology TheraSphere / Beads % 16% GALIL Interventional Vascular EKOS % 22% Varithena % 270% Interventional Pulmonology PneumRx Coil (27%) (36%) Total Interventional Medicine % 25% Specialty Pharmaceuticals CroFab % 6% DigiFab % 17% Voraxaze % 15% Vistogard /other % 94% Total Specialty Pharmaceuticals % 12% Total product sales % 19% Licensing Zytiga % (10%) Lemtrada % 67% Other (18%) (24%) Total Licensing % (3%) Total % 11% 35

36 IFRS to Adjusted Earnings Reconciliation 2016/17 IFRS 2016/17 ( m) Amortisation of acquired intangibles ( m) DOJ settlement ( m) Other ( m) Adjusted 2016/17 Revenues Actual growth +27% +27% CER growth +11% +11% Operating Profit Actual growth +2% +39% CER growth +13% Basic EPS 8.7p 7.6p 6.5p 0.3p 23.1p Actual growth -45% +5% ( m) 36 36

37 IFRS to Adjusted Earnings Reconciliation 2015/16 IFRS 2015/16 ( m) Amortisation of acquired intangibles ( m) Other ( m) Adjusted 2015/16 Revenues Operating Profit Basic EPS 15.8p 6.3p (0.2)p 21.9p ( m) 37 37

38 Free cash flow reconciliation Net cash flow from operating activities 2016/ /16 Purchase of intangible assets Purchase of property, plant and equipment Free cash flow 74.2m (0.6)m (8.9)m 64.7m -22% -27% 95.6m (1.3)m (6.2)m 88.1m 38 38

39 . FX sensitivity for 2017/18 $0.05 movement impacts: Revenue + / - 20m Combined SG&A and R&D + / - 7m FX Hedges + / - 5m At 31 March 2017, BTG had forward contracts to sell $170m at a weighted average exchange rate of $1.33: 1 39