SUSTAINABILITY REPORT. INTERACTIVE REPORT 2016

Transcription

1 INTERACTIVE REPORT 2016

2 Our mission: treat more patients with groundbreaking medicines Actelion Ltd. is a leading biopharmaceutical company focused on the discovery, development and commercialization of innovative drugs for diseases with significant unmet medical needs. Actelion is a leader in the field of pulmonary arterial hypertension (PAH). Our portfolio of PAH treatments covers the spectrum of disease, from WHO Functional Class (FC) II through to FC IV, with oral, inhaled and intravenous medications. Although not available in all countries, Actelion also has treatments approved by health authorities for a number of specialist diseases including type 1 Gaucher disease, Niemann-Pick type C disease, digital ulcers in patients suffering from systemic sclerosis, and mycosis fungoides type cutaneous T-cell lymphoma. CONTENTS 03 INTRODUCTION 08 PATIENTS 17 OUR BEHAVIOR 21 OUR PEOPLE 27 ENVIRONMENT 2

3 INTRODUCTION CONTENTS INTRODUCTION PATIENTS OUR BEHAVIOR OUR PEOPLE ENVIRONMENT 3

4 Actelion s Board and management are committed to ensuring that responsible business and sustainability considerations are integrated into everyday business thinking and decision making throughout Actelion. The Nominating and Governance Committee oversees Actelion s sustainability and governance efforts. For Actelion, 2016 was a year of sustained progress. The company s sales and earnings increased, driven by the highly successful launch of Uptravi, as well as the continued strong uptake of Opsumit and the good performance of its other products. At the end of 2016, over 70,000 patients around the globe were benefiting from our drugs. In 2016, we also continued to be recognized for our sustainability and reporting practices, being included in the Dow Jones Sustainability World Index for the second year in a row. Increasingly, stakeholders are considering sustainability performance in their employment, investment and other decisions. In January 2017, we also learnt that we qualified, as one of the top-scoring companies in our industry, for the inclusion in the 2017 RobecoSam Sustainability Yearbook and have received the Industry Mover Distinction. We are very proud of this achievement as it validates our efforts to continue to improve our sustainability performance. With this update to our latest Sustainability Report, we aim to disclose our performance on material issues in a way that highlights the relationship between business success and sustainability considerations in its operations. This Sustainability Report has been prepared in accordance with the G4 Sustainability Reporting Guidelines issued by the Global Reporting Initiative (GRI). The GRI Standards are the most widely adopted sustainability reporting standard in the world. In 2015, as part of our commitment to corporate transparency, we conducted a full materiality assessment, which helped us to identify and rank the issues that we believe are most critical to the continued success of our company, and that matter most to our internal and external stakeholders. To determine the material aspects to include in our reporting, we reached out to stakeholders such as patient associations, investors and employees. In addition, we reviewed topics referred to in the Dow Jones Sustainability Indices and in other biotech and pharmaceutical companies reporting, or identified by industry associations. Internally, materiality workshops were conducted with representatives from virtually every area of our company, followed by oneon-one interviews with Actelion experts. In addition, a wide variety of company literature and research was reviewed. Based on this process, the issues deemed most material to Actelion and to our stakeholders are shown on the next page. 4

5 Material Aspects *Font size is an indication of importance to both Actelion s stakeholders and the business. 5

6 Value Chain As part of our preparation, it was also important to consider the different elements of our business, our activities, and how we contribute to value creation for our stakeholders. In order to capture this information, we have visualized the value chain of Actelion. A full description of the economic value generated and distributed as a result of our activities can be found in the Financial Report of the Annual Report

7 FINANCIAL PERFORMANCE Product Sales Core R&D Expenditure Core Operating Income 2014 CHF 1,956 million 2014 CHF 369 million 2014 CHF 743 million 2015 CHF 2,042 million 2015 CHF 404 million 2015 CHF 814 million 2016 CHF 2,412 million 2016 CHF 509 million 2016 CHF 992 million An outstanding commercial performance, driven by the continued highly successful rollout of Opsumit and the strong uptake of Uptravi, resulted in excellent product sales. Actelion has made significant progress with its strong pipeline of best-in-class compounds to diversify the business. The excellent commercial performance has allowed R&D efforts to be increased while continuing to deliver strong earnings growth. Focus on the bottom line, coupled with strong sales, resulted in core operating income growth of 17% at CER. Core Earnings Per Share Total Shareholder Return Cash Returned to Shareholders 2014 CHF Year TSR: 155% 2014 CHF 133 million 2015 CHF Year TSR: 60% 2015 CHF 927 million 2016 CHF Year TSR: 59% 2016 CHF 428 million Core EPS increased by 27% at CER, driven by a strong underlying performance and enhanced by the share repurchase program. Actelion shares continued to perform strongly during 2016, regardless of the extraordinary volatility created by the strategic discussions announced in late November. The share price performance, together with the increased dividend of CHF 1.50, resulted in a TSR of 59% for In 2016, in keeping with its commitment to maximize shareholder value creation, Actelion returned 428 million Swiss francs to shareholders through the second-line share repurchase program and an increased dividend. 7

8 PATIENTS CONTENTS INTRODUCTION PATIENTS OUR BEHAVIOR OUR PEOPLE ENVIRONMENT 8

9 ACTELION S PRODUCT PORTFOLIO Our PAH franchise Pulmonary arterial hypertension (PAH) is a chronic, life-threatening disorder characterized by abnormally high blood pressure in the arteries between the heart and lungs. Actelion s PAH franchise encompasses oral, inhaled and intravenous formulations of compounds, for patients at various stages in the course of this disease (WHO Functional Classes II IV), enabling us to deliver treatments across the entire continuum of care. Opsumit (macitentan) Sales CHF million % increase in Swiss francs 57% increase at CER Opsumit is an orally available endothelin receptor antagonist that resulted from a tailored drug discovery process in Actelion s laboratories. Opsumit is commercially available in over 45 markets, including the US (since November 2013), Germany (since January 2014) and Japan (since June 2015). The registration process for other countries is ongoing. Tracleer (bosentan) Sales CHF million 1,212 1,020 16% decrease in Swiss francs 18% decrease at CER Tracleer, an orally available endothelin receptor antagonist, was the first oral treatment approved for PAH. Tracleer is commercially available in over 60 markets, including the US (since November 2001), the EU (since May 2002) and Japan (since April 2005). In addition to the PAH indication, Tracleer is approved in the EU for reducing the number of new digital ulcers in patients suffering from systemic sclerosis and ongoing digital ulcer disease. 9

10 Uptravi (selexipag) Veletri (epoprostenol for injection) Ventavis (iloprost) Sales 2016 CHF million 245 Uptravi, originally discovered and synthesized by Nippon Shinyaku, is the only approved oral, selective IP receptor agonist targeting the prostacyclin pathway in PAH. Uptravi is commercially available in 9 markets, including the US (since January 2016) and Germany (since June 2016) with marketing authorization granted in Australia, Canada, the EU, Japan, New Zealand, South Korea, Switzerland and the US. The registration process for other countries is ongoing. Sales CHF million % increase in Swiss francs 12% increase at CER Veletri, an intravenous prostacyclin, is stable at room temperature (77 F/25 C) for up to 24 hours, removing the need for patients to carry ice packs. Veletri is commercially available in 17 markets, including the US since 2010, Switzerland and Canada (marketed as Caripul ) since 2012, Japan (marketed as Epoprostenol ACT ) since 2013, and some European countries since The registration process for other countries is ongoing. Sales CHF million % decrease in Swiss francs 32% decrease at CER Ventavis is an inhaled formulation of iloprost, a synthetic compound structurally similar to prostacyclin (PGI2). Actelion has marketed Ventavis in the US since Elsewhere it is marketed by Bayer Healthcare. 10

11 Our specialty products Actelion is creating specialty franchises alongside PAH discovering, developing and/ or in-licensing/acquiring products in new therapeutic areas. Valchlor (mechlorethamine) Zavesca (miglustat) More details on the availability of our products can be found on Sales (CHF million) % increase in Swiss francs 27% increase at CER Valchlor gel 0.016%, a topical formulation of mechlorethamine, is used for the treatment of stage IA and IB mycosis fungoides type cutaneous T-cell lymphoma in patients who have received prior skin directed therapy. Valchlor is commercially available in the US (since November 2013) and Israel (since April 2016). Valchlor is currently under review with the European Medicines Agency under the trade name Ledaga. Sales (CHF million) % increase in Swiss francs 12% increase at CER Zavesca, an orally active inhibitor of glucosylceramide synthase, is used as monotherapy in adult patients with mild to moderate type I Gaucher disease (GD1) for whom enzyme replacement therapy is not a therapeutic option. Zavesca is commercially available for the treatment of GD1 in 47 markets, including the US and the EU (since 2003). In the EU, Zavesca is also indicated for the treatment of progressive neurological manifestations in adult and pediatric patients with Niemann-Pick type C (NP-C) disease, a rare neurodegenerative genetic disorder. Zavesca is commercially available for the treatment of NP-C in 46 markets, including the EU (since 2009) and Japan (since 2012, marketed as Brazaves ). 11

12 Actelion s mission is to treat more patients with groundbreaking therapies. With our growing portfolio of innovative medicines, we are serving increasing numbers of patients in countries throughout the world. At the end of 2016, over 70,000 patients were benefiting from Actelion s drugs. We are leaders in the science and treatment of pulmonary arterial hypertension (PAH), with over 15 years experience in this area. Our understanding of the complex pathways and molecular mechanisms of this disease has enabled the development of tailored medicines that can make a real difference to patient outcomes. BREAKTHROUGH THERAPIES Innovation is the cornerstone of our success. We are set to continue our leadership in the field of PAH into the mid-2020s, thanks to our assets Veletri, Opsumit and Uptravi (developed in partnership with Nippon Shinyaku). Our expertise in human biology especially our knowledge of specific families of molecular targets such as G protein-coupled receptors led us to Opsumit and will facilitate advances into new areas. Actelion s drug discovery efforts focus on the design, synthesis and optimization of low molecular weight compounds which are active on molecular target families. This focus allows high productivity in the generation of innovative compounds potentially addressing a wide range of high unmet medical needs. Initially, the company looked solely at G proteincoupled receptors (GPCRs) and a specific enzyme family known as aspartic proteinases. As the company s capabilities have expanded, so have the target platforms, adding antiinfectives, ion channels and a broad range of soluble enzymes. Actelion s promising development pipeline comprises novel compounds addressing a broad range of diseases, including cardiovascular and immunological disorders as well as CNS disorders and infectious diseases. Our late-stage product candidates include cadazolid, a novel antibiotic under investigation for Clostridium difficile-associated diarrhea (CDAD), and ponesimod, an S1P 1 receptor modulator investigated in multiple sclerosis. R&D Spend % % % % of R&D Spend compared to sales Number of R&D Employees Research Development Number of Patents , , ,831 12

13 In addition to advancing our own pipeline, Actelion is continuously looking externally for innovative compounds addressing diseases with unmet medical need which have the potential to change the standard of care. In November 2016, the company announced that it had obtained an option to in-license vamorolone from ReveraGen. Vamorolone, a novel compound for the treatment of Duchenne muscular dystrophy, holds potential to better preserve muscle function and prolong ambulation for the patient, without some of the side effects associated with glucocorticoid therapy. ACCESS TO DRUGS Our commitment to patients is reflected by the patient access programs we have established in many countries. In Australia, only one PAH therapy per patient is currently reimbursed by the government and Actelion s programs have allowed access to combination therapy for hundreds of patients who would not otherwise be able to receive optimum treatment. In the US, our programs have assisted more than 7,500 patients since Such assistance includes the provision of treatment at no charge for eligible patients who do not have healthcare coverage and lack financial means. For eligible patients with commercial insurance, our financial assistance programs help to reduce out-of-pocket copayment costs. In addition, Actelion provides funding to third-party, non-profit organizations that may offer support to patients. In other parts of the world, where Actelion s drugs are not approved or reimbursed, global guidelines are in place to facilitate access while ensuring full compliance with local regulations. We also continue to work with governments and other stakeholders to widen accessibility in geographies around the world. WORKING WITH PATIENTS To gain deeper insights into patients day-to-day needs and the challenges they face, Actelion continues to strengthen its collaboration with patients and patient organizations around the globe. Patient organizations can provide an important support network and information resources for patients living with a serious disease. Operating on a non-profit basis, they help to raise awareness of treatment options and advocate for better patient care. Actelion believes that patient organizations should be independent, and we abide by the relevant codes of practice for interacting with such organizations. Through our collaborative work with patient groups and healthcare professionals, and as part of our advocacy function, we lead and support a variety of far-reaching activities that raise awareness of the challenges facing those living with rare diseases and help to bring about positive change. Our activities include: the development of educational resources for patients, such as our innovative PAHuman ebook to better explain the disease and its impact; raising disease awareness through educational initiatives such as our international Think Again. Think NP-C campaign to promote earlier diagnosis of Niemann-Pick type C disease among healthcare professionals unfamiliar with this rare condition; supporting parliamentary events to help shape health policy; sharing expert and patient insights to inspire and empower others to live well with the disease; stakeholder meetings and training; surveys to better understand the patient and caregiver experience. Our continued global advocacy work has strengthened Actelion s position as a leader in our therapeutic areas and, importantly, as a trusted partner of the wider rare diseases community. In recognition of this commitment, the European Organisation for Rare Diseases honored Actelion with the EURORDIS Company Award for This award is very special and important for Actelion as it acknowledges 13

14 our long-term efforts and commitment to rare diseases. Managing a rare disease is much more than providing a drug, it includes an open and fruitful collaboration with all stakeholders. We are working together with over 120 patient organizations worldwide to support disease awareness, education and patient-centric initiatives. Alessandro Maresta (Head of Global Medical Affairs). In September, at the Evening of Hope Gala held by the California Chapter of the Pulmonary Hypertension Association, Jean- Paul and Martine Clozel were presented with the Chapter s 2016 Legacy Award for their dedication as pioneers in the field of PAH. Improving health outcomes for patients is our main goal. We use patient-reported outcome (PRO) questionnaires to measure and provide information on the benefits of treatment from the patient s perspective. PROs essentially reflect the voice of the patient, independent from the input and interpretation of physicians, other medical experts and carers. They provide insight into outcomes that are not amenable to clinical or laboratory evaluation, such as severity of pain or impact of disease on daily The contributions Drs. Clozel have made to the pulmonary hypertension community are vast. Their inspired work has changed the course of this rare disease for people around the world... Brad A. Wong, president and chief executive officer of PHA activities. In 2016, we introduced the Insomnia Daytime Symptoms and Impacts Questionnaire, thus bringing the total number of PRO projects to five: PAH-SYMPACT (PAH symptoms and impact assessment tool) HDISS-DU (for digital ulcers) FSIQ-RMS (for relapsing forms of multiple sclerosis) CDAD-DaySyms (for Clostridium difficileassociated diarrhea) IDSIQ (for insomnia) PUBLICATION IN CHEST 1 ON HEALTH-RELATED QUALITY OF LIFE PAH affects patients daily activities and health-related quality of life (HRQoL). The latter includes not only physical but also social, emotional and psychological aspects. Using questionnaire data from the SERAPHIN study, the short- and long-term impacts of macitentan on HRQoL were evaluated in domains such as mental health, bodily pain and social functioning. After six months treatment, macitentan significantly improved scores in seven of the eight domains studied, compared to placebo, as well as physical and mental component summary (PCS/MCS) scores. In addition, the evaluation showed that higher PCS/MCS scores also represented a lower risk of PAH-associated complications or mortality

15 PRODUCT SAFETY AND QUALITY The safety of the patients we serve is of paramount importance. Our products are marketed and distributed with thorough labeling and product information. We work with regulators to develop prescribing information that provides the benefit and risk information healthcare professionals require. Comprehensive and rigorous systems for detecting and evaluating adverse effects ensure that any new safety data is immediately provided to regulators and healthcare professionals. As the quality of our products is crucial to patient safety, we ensure that they are manufactured to the highest global standards. Our focus on quality assurance encompasses the complete product life cycle from initial use in clinical trials to use in physicians practices. Rather than manufacturing its own commercial drugs, Actelion outsources the process to contract manufacturers. The supply chain is subject to thorough risk assessment and regular audits. Depending on the product, security of product supply is assured through back-up suppliers and inventory management. In view of the risks associated with counterfeit or adulterated drugs, we are working diligently to expand our serialization and track-and-trace systems, so as to ensure delivery of safe, secure and effective products to our patients. Our product security and brand protection programs include the following measures: Adoption of sophisticated product packaging technologies Continuous auditing and monitoring of manufacturing and supply chain partners Monitoring of drug sales and potential threats to the supply chain from counterfeit or diverted products Our focus on quality assurance encompasses the complete product life cycle Learn more about our interaction with patient associations on 15

16 PREVENTING MEDICATION ERRORS In January 2016, Actelion launched Uptravi, a selective oral IP receptor agonist targeting the prostacyclin pathway in PAH. To ensure that this treatment delivers long-term benefits, an individualized maintenance dose has to be determined via an up-titration process. Under the guidance of physicians and nurses, the dose is increased over a number of weeks, starting with one 200 microgram tablet twice daily, up to a maximum of 1,600 micrograms twice daily. Long-term maintenance regimen START STEP UP STEP DOWN MAINTENANCE DOSE STEP 1 STEP 2 STEP 3 STEP 4 STEP 5 STEP 6 BACK TO STEP 5 SINGLE TABLET SAME DOSE To facilitate the titration process, a special titration guide has been developed for healthcare professionals and for patients. We worked closely with healthcare professionals and specialist nurses to ensure that the information provided for patients is clear and readily comprehensible. Our up-titration packaging and titration guide was recently used by the UK Medicines and Healthcare Products Regulatory Agency (MHRA) as an example of best practice for the prevention of medication errors. 16

17 OUR BEHAVIOR Striving for integrity in all we do 17

18 Our stakeholders value excellence in governance. We aim to provide greater transparency, applying the highest standards of integrity across the company. Our Compliance function seeks to drive a culture of integrity, with the following priorities: communicate clearly to employees focus on important compliance risk areas improve compliance behavior through training and support ensure that employees can raise concerns and that these are properly addressed ensure fair and objective investigations of potential policy breaches An example of best practice in governance is our Code of Business Conduct, which was rated among the top 3 codes in Switzerland by KPMG in The revised Code underpins our commitment to integrity and sets out fundamental rules for interacting with others as we drive our business forward. Supporting policies, standard operating procedures and guidelines provide more detail on how our high-level commitments are to be applied in practice. All Actelion employees have undergone mandatory training to ensure compliance with the Code. A Code app is installed on all Actelion computers and mobile devices. Incorporating the key principles and the full Code in eleven languages, the app also offers instant access to compliance professionals and includes a practical Moral Compass, helping employees to evaluate important ramifications when taking decisions. PRIVACY AND DATA SECURITY Actelion understands the importance of protecting personal information and applying the highest ethical and regulatory standards. We are committed to respecting our stakeholders privacy and safeguarding all their personal information. Actelion s data protection policy covers data on patients, healthcare professionals, customers, suppliers and employees. To ensure the integrity and privacy of the personal and health-related information provided to us, we use state-of-the-art information security programs, focusing on protection of sensitive information and detection of unauthorized access. In 2016, Actelion received no substantiated complaints regarding breaches of customer privacy or losses of customer data. CORRUPTION AND BRIBERY Full compliance with applicable laws in all the regions where Actelion operates is crucial to our success. Actelion s position is clearly stated in our Anti- Corruption and Anti-Bribery Policy: We take a zero tolerance approach to bribery and corruption and are committed to acting professionally in all our business dealings and relationships wherever we operate. We implement and enforce effective systems to counter bribery. We will uphold all laws relevant to countering bribery and corruption in all the jurisdictions in which we operate. All Actelion employees are required to complete training on this policy. In 2015, all of Actelion s operations were reviewed for the first time using an online compliance assessment tool, which also covers risks related to corruption and bribery. The results of this assessment were used to refine the questionnaire, and it now forms part of an annual review which will provide an overview of the implementation of compliance programs. Each affiliate is evaluated with the aid of the Transparency International Corruption Perceptions Index and, based on the outcome, steps are taken to mitigate any risks. ETHICAL MARKETING We have a fundamental responsibility to market our medicines in a way that enhances patient care by helping healthcare professionals to make informed prescribing decisions. Ensuring high ethical standards in all our sales and marketing activities is a top priority, and all colleagues who interact with healthcare professionals receive specific training as part of our overall commitment to responsible business practices. In 2015, we updated our policy on interactions with healthcare professionals. Reflecting changes in today s healthcare environment, the updated policy incorporates the provisions of the International Federation of Pharmaceutical Manufacturers & Associations (IFPMA) Code of Practice, the Pharmaceutical Research and Manufacturers of America (PhRMA) Code on Interactions with Healthcare Professionals, 18

19 the European Federation of Pharmaceutical Industries and Associations (EFPIA) Code, and other applicable industry codes. In 2016, fewer than 10 incidents were reported relating to professional practices (i.e. compliance with internal marketing codes and with industry codes and regulations). In substantiated cases, appropriate disciplinary action was taken. LABOR AND HUMAN RIGHTS Actelion respects the rights of its employees as set out in the Universal Declaration of Human Rights, and we fully comply with all relevant laws, rules and regulations governing labor, employment and the employment relationship in all the countries where we operate. We respect the right of all employees to join a legally recognized employee association, and we comply with all laws relating to employee representation. We strive to maintain an open dialogue with all our employees and their representatives. Due to the nature of our business and the location of our operations, the risk of child or forced labor is minimal. We do, however, remain vigilant for unexpected issues that may arise not only in our own operations but also in relation to our procurement practices. Our expectations regarding working conditions, human rights protection, business ethics, legal compliance and environmental protection are set out in our Supplier Code of Conduct. ANIMAL RESEARCH Regulatory authorities around the world require drugs to be thoroughly evaluated before they are used in human studies. Animal testing remains an essential part of this process both for scientific reasons and to safeguard the volunteers and patients who take part in subsequent clinical trials. Actelion s policies and standards for the use of laboratory animals are based on the 3R principle: REFINEMENT Alleviate or minimize impacts to animals by reducing potentially painful or invasive procedures, whenever possible REDUCTION Use the absolute minimum number of animals required to obtain valid results in each study REPLACEMENT Always look for alternative, non-animalbased research methods where possible In addition, we ensure that the use and care of all laboratory animals meets or exceeds relevant local, national and international regulations. Our programs and facilities are subject to unannounced regulatory review and inspections. For sponsored work at contract research organizations, our animal welfare oversight activities include regular on-site evaluations by our veterinary staff. Actelion has never used great apes (gorillas, chimpanzees, orangutans and bonobos) in its research, and in 2013 our animal welfare policy was expanded to explicitly prohibit any such use. Actelion is also a signatory to the Interpharma Animal Welfare Charter, in which Swiss research-based pharmaceutical companies outline their commitment to applying the highest possible standards in animal studies. The 2016 Animal Welfare report, detailing progress made, is available on CLINICAL TRIALS TRANSPARENCY Clinical trials are essential to the development of innovative medicines. Actelion is committed to the highest standards of quality and ethical conduct in all our clinical research. Our trials are performed in accordance with internationally accepted guidelines, and protocols are evaluated by independent review boards and ethics committees prior to study initiation. We are also dedicated to improving public health through responsible clinical trial data transparency which as well as complying with applicable regulations respects our proprietary 19

20 information and patients privacy. In addition to our existing clinical trial disclosure activities, we are committed to implementing the EFPIA/ PhRMA Principles for Responsible Clinical Trial Data Sharing. COMMUNITIES We aim to be good neighbors in the communities where we live and work. Our community efforts continue to focus primarily on science education, with the goal being to ignite a passion for science in young minds. pharmaceutical industry, From the origins of genetics to applied genomics and Cancer its origins and treatment. Other community efforts include support for a local youth center in Allschwil. In the US, Actelion supported a number of different charities through outright donations as well as employee matching programs. We are investing in education at the beginning of the cycle. For example, Actelion s annual Elementary school science days are attended by over 150 children and teachers from local schools. At these 2-day events, young students are exposed to hands-on, real-world science, with a fun and interactive approach. Together with other local companies, Actelion also continues to support a mobile lab project, for which we helped to develop the concept and to design experiments. Targeting elementary schools in Northwestern Switzerland, the aim is that the bus hosting the mobile lab should now visit 80 schools per year. We also organize annual lab weeks designed to give interested students from local high schools an insight into life as a researcher. In 2016, over 230 local high school students attended our fourth series of summer lectures, featuring topics such as Modern drug discovery approaches, Robots and stem cells in the lab, Observing and analyzing the work of an epidemiologist, Patents in the 20

21 OUR PEOPLE CONTENTS INTRODUCTION PATIENTS OUR BEHAVIOR OUR PEOPLE ENVIRONMENT 21

22 Our people are the foundation of our business, contributing to our success as a global biopharmaceutical company. Our entrepreneurial culture is anchored in Actelion s core values, and we continue to live these values so as to improve the lives of patients, communities and the environment. DIVERSITY AND INCLUSION Actelion s long-standing commitment to fostering a diverse and inclusive environment stems from our shared belief that diversity creates a whole greater than the sum of its parts. Indeed, diversity and inclusiveness in terms of ability, experience, gender, sexual orientation, race and culture are indispensable for a successful organization. We are committed to harnessing the power of difference to achieve business success and are implementing strategies to attract, retain and advance top talent from all backgrounds while fostering a globally inclusive work environment. During the recruitment process, we seek to attract a diverse selection of candidates. We then select the best fit for the position following a series of behavioral competency assessments specifically designed for Actelion. Employees by Region & Nationality US 498 EU 533 CH 1,127 RoW 208 JP 258 Our employees come from over 50 countries, with an almost equal split between male and female employees. We also believe that diversity of thought allows us to benefit from complementary expertise, driving our continued success. American 498 Chinese 51 British 101 French 458 German 235 Italian 115 Japanese 257 Others 525 Spanish 56 Swiss

23 RECRUITMENT, RETENTION AND DEVELOPMENT Our future as a company depends on a workplace that enables employees to develop their careers and achieve their objectives both at work and outside the office. We recruit, develop and retain talented individuals who want to make a difference to the lives of patients across the globe. In 2016, we hired 273 permanent employees worldwide. In our annual Organizational Talent and Development (OTD) review, we assess our talent to identify high performance and provide further support for those who display leadership potential e.g. through further education, leadership training and international assignments. Actelion offers both traditional and nontraditional benefits to help keep employees engaged, while also maintaining a healthy work-life balance. After ten years of service, Actelion colleagues are eligible for 4 weeks fully paid sabbatical leave. We believe that disconnecting from work for an extended period to pursue personal interests leaves employees energized and ready to immerse themselves when they return; this has been confirmed by feedback from the more than 300 colleagues who have benefited from this program. In addition, we offer 2-month research sabbaticals to individuals, which are announced during our annual Drug Discovery Day. Current Workforce Total: 2,624 1,313 Male Employees Baby Boomers Baby Boomers Male Employees Generation X Generation X ,311 Female Employees Generation Y Turnover Total: Female Employees 25 Generation Y Generation Z 2000-present New Hires Total: Male Employees Baby Boomers Generation X Female Employees 62 Generation Y Generation Z 2000-present 23

24 Other benefits include health, pension, disability and maternity benefits. Depending on local requirements, additional benefits may be available. We also offer free, confidential counseling for all headquarter employees on both work-related and private matters. At our Allschwil location, we offer subsidized on-site daycare for up to 30 children from age 3 months to 6 years. We believe that a culture that fosters our employees development and growth is essential to our business success. To support people in achieving their full potential, we provide a wide range of internal and external learning and development programs. Actelion s leadership and management programs are modular training initiatives based on Actelion s core values and designed to help our managers to be better leaders. Other programs cover topics such as coaching, communication, presentation skills, collaboration and languages. In November 2016, we launched a survey to determine whether the training programs we offer meet our colleagues needs. We also provide financial assistance to employees who wish to advance their education through an accredited university or business school. 24

25 PERFORMANCE MANAGEMENT By setting objectives aligned with our strategy and by performing coaching and feedback analysis, we are able to track performance at every level. This includes managers accountability for working with their teams to develop individual and team performance targets. It also involves fostering an understanding of each employee s contribution to our overall business objectives. All of our employees own their development in partnership with their line manager and participate in mandatory annual often biannual performance reviews. Our performance related bonus plans and stock based compensation plans are designed to create an ownership mindset that aligns our interests with the interests of our shareholders while rewarding our best employees for their performance and anticipated future contributions. RECOGNITION Employee recognition, when delivered effectively, is a powerful engagement tool for driving desired behaviors and achieving organizational goals. We believe that recognition involves the acknowledgement and appreciation of the work our employees are doing, and how they have accomplished it. We also believe that peer-to-peer recognition is a strong engagement driver. In 2015, we launched Moments of WOW, an online tool that allows employees to send and receive 25

26 recognition to and from their colleagues, aligned with our values. Recognizing each other s efforts provides focus, direction and clarity and creates an engaging and energizing work environment the key ingredient for sustained success and job satisfaction. HEALTH, SAFETY AND WELL-BEING Optimizing employee health, safety and wellbeing is a priority for Actelion, as we believe that it not only benefits our employees but also helps to reduce absence-related costs, increase productivity and drive business success. We focus on preventing both work-related and non work-related accidents and injuries, as well as enabling employees to improve their health and well-being at work and at home. An important part of cultivating a healthy workplace is investing in our employees awareness of their own health through strategies such as health screening, education, fitness, nutritional counseling and emotional health offerings. In 2016, Actelion participated in the Global Corporate Challenge (GCC), an independent program through which teams of colleagues compete in a 100-day virtual journey around the world. Over 1,600 people (more than 60% of our global workforce) participated. Actelion secured the number 32 spot in the World s Most Active global rankings, out of 1,200 organizations participating worldwide. Notably, after 100 days, 73% of the participants were walking more than 10,000 steps per day up from 15% at the start of the challenge. In addition to exercise, the GCC offers advice, strategies and tools for improving sleep and nutrition as well as for practicing mindfulness. We continuously work to improve our safety performance by developing programs to promote a safe and healthy workplace. These efforts are designed to minimize risks for employees and are tailored to specific work environments, such as laboratories and office areas. We seek to raise safety awareness among our employees and adopt more effective techniques to improve safe work practices. For example, all headquarter colleagues were invited to learn how to use an automated external defibrillator (AED) and to attend a refresher course on basic CPR. The Health and Safety team also hosted several events including Eye Protection and Keep your Balance days. In the US, our sales force undergoes mandatory safe driving training including modules such as Safe Freeway Driving or Deadly Distractions and we are pleased to report that the accident rate has been falling for 3 years. We have numerous additional employee health and well-being programs and support services. These include stress management, on-site massages, annual flu shots, relaxation pods, fitness rooms, discounts on gym memberships and dedicated Actelion sports teams. The health and safety data given below refer to headquarter employees. Long-term absences are capped at 30 days and prior years have been adjusted. Headquarter Health & Safety Data Average hours per employee lost due to accident* Average hours per employee lost due to illness* 26

27 ENVIRONMENT 27

28 Actelion s primary environmental sustainability goal is to reduce our environmental impact so as to help ensure a safe and healthy environment for present and future generations. Due to the nature of our activities, our environmental footprint is not as substantial as in other industries. However, we take our responsibility very seriously and are continuously working to further reduce the environmental impact of our operations. In October 2016, Actelion concluded an agreement with the Swiss federal government whereby the company has undertaken to reduce CO2 emissions from its headquarters by 16% by EMISSIONS Since 2010, Actelion has been participating in the Carbon Disclosure Project (CDP), measuring, managing and sharing information on our environmental performance at our headquarters in Switzerland, as well as larger operating sites around the globe. We have made some major progress on our reporting and are pleased to be able to include, for the first time, all affiliates in our carbon footprint for The company s total carbon footprint (scope 1 and scope 2) amounted to 4.4 million kilograms. For comparative purposes, the major sites we reported in previous years had a carbon footprint of 3.2 million kilograms. The bulk of Actelion s carbon emissions stem from our headquarters in Allschwil, Switzerland. Since January 2014, the energy supplied to headquarters has been obtained entirely from hydropower and solar power. This has resulted in a substantial decrease in our carbon emissions. In 2016, we also installed Telepresence systems at our main locations in Switzerland and the US. These systems provide users with an immersive, life-like video conferencing experience that increases engagement and quality of collaboration. The easy-to-use systems bring together teams working remotely, thus rapidly building relationships and trust while reducing travel related emissions and costs. WATER AND WASTE Although our business is not water-intensive, we are continuously working to minimize the use of this precious resource. Water is used for a variety of purposes, such as laboratory experimentation, drinking water, facility cooling, and cleaning and maintenance operations. Our facilities are built to the latest standards and include many features designed to minimize water use (e.g. tap sensors). The increase in water usage stems mostly from increased research activity (including more people), a long hot and dry spell in 2016 which resulted in more water used for cooling as well as increased watering of outside areas. We strictly adhere to all regulations concerning water quality and potential impacts on water resources. We work to eliminate waste as far as possible. When this is not possible, we aim to reduce waste and recycle so as to mitigate environmental impacts. Actelion s hazardous waste (as defined by local regulations) stems from our research activities in Switzerland. It is sent off-site for recycling, reuse, treatment or disposal. Volatile organic compounds (VOCs), used in our research facilities, may have a negative impact on the environment. To minimize emissions of VOCs, our high-performance liquid chromatography (HPLC) units and waste hoods are equipped with special absorbing filters which can retain VOCs. Most of our non-hazardous waste plastic, cardboard, paper and other commercial waste is generated in our offices and catering facilities and is recycled whenever possible. Carbon Footprint Evolution at Major Sites Million kg s CO 2 Water Consumption at Headquarters Thousand m Waste Generation at Headquarters Hazardous (Metric tons) Non-Hazardous (Metric tons) * * 2016 is global number (prior years only included main sites) Methodology based on GHG protocol location-based approach with local country-mix emission factors This data is assured by Ernst & Young Ltd.; the assurance report is available on

29 Actelion Ltd Gewerbestrasse 16 CH-4123 Allschwil Switzerland Phone Fax All trademarks are legally protected. Copyright 2017 Actelion Pharmaceuticals Ltd. Details of Actelion Worldwide can be found on Designed by Landscape 29