Mayne Group Limited. ABN AMRO Global Generic Pharmaceutical Conference. Mr Mark Bisset Vice President Global Business Development

Transcription

1 Mayne Group Limited ABN AMRO Global Generic Pharmaceutical Conference Mr Mark Bisset Vice President Global Business Development 9 March 2005 Mumbai, India

2 Forward-Looking Statement Comments will be made that are forward-looking statements for the purposes of the Private Securities Litigation Reform Act of We caution that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated. Economic, competitive, governmental, technological and other factors that may affect Mayne s operations are discussed in our Securities and Exchange Commission Form 20F for the year ended 30 June 2004, and are incorporated here by reference. We undertake no obligation to release publicly any revisions to forward-looking statements as the result of subsequent events or developments. 2

3 Agenda Mayne Group overview Mayne Pharma overview The Indian opportunity 3

4 Mayne Group snapshot Mayne Group Limited ASX listed: $US 2.0 billion market capitalisation 12,000 employees* Pharmaceuticals Diagnostic Services Pharmacy Mayne Pharma Global specialty and generic injectable pharmaceuticals Consumer products Nutraceutical and OTC products Pathology Diagnostic Imaging Medical Centres Wholesale distribution Retail development * As at 31 December 2004 Note: $AU amounts converted to $US at $US 0.70/$AU

5 Mayne s business portfolio Focused on high growth and high return sectors in health Leading market positions established in each business Portfolio benefits Diversification risk reduction Capital allocation strong cash flow from Diagnostic Services and Pharmacy support Pharma growth Strong returns each business is positioned to deliver returns that build shareholder value 5

6 Relative contribution of businesses 1H05 Revenue Contribution* $US 1,384 million 1H05 EBITA Contribution* $US 94 million** Pharmacy 58% Pharmaceuticals 21% Pharmacy 14% Pharmaceuticals 51% Diagnostics 21% Diagnostics 35% * Based on 1H05 continuing business revenue and EBITA ** After unallocated items of $US 5.4 million and before significant item of $US 3.5 million Note: $AU amounts converted to $US at $US 0.70/$AU

7 Mayne Pharma 7

8 Mayne Pharma snapshot History Mayne acquired Faulding in 2001 Faulding/DBL has more than 150 years experience in pharmaceuticals Financials FY04 sales FY04 EBITA margin $US 351 million (5 year CAGR: 22%) 19.6% (5 year CAGR: 25%) People Places Employees Geographic presence 1,900 Direct: 20 countries, 5 continents Indirect distribution: 30 countries Products Approved products (oncology emphasis) Americas EMEA Asia Pac Facilities Manufacturing facilities Mulgrave, Australia (cytotoxic) Aguadilla, Puerto Rico Boulder, USA (API processing) Wasserburg, Germany Note: $AU amounts converted to $US at $US 0.70/$AU

9 Global growth strategy SPECIALTY PHARMACEUTICALS FOCUS Proprietary products, branded generics, commodity generics, biogenerics INTERNAL DEVELOPMENT GEOGRAPHIC EXPANSION ACQUISITION & IN-LICENSING LOW COST SUPPLY CHAIN 9

10 Hospital (injectable) specialist Anaesthetics Analgesics Revenue by therapeutic class* Anti Infective Agents Antibacterial Agents Anaesthetics Anticholinergic Agents Analgesics Anticoagulants/Antithrombotic Agents Antidotes Anti-Infectives Antiepileptic Agents Oncology Antifungal Agents Antihistamines Antipsychotic Agents Other Cardiovascular Agents Diagnostic Agents Hormone Replacement Therapies Immunosuppressants Bone Modulating/ Labour Agents Oncology Muscle Relaxants Pain Management Oncology * Based on FY04 revenues Vitamins, Mineral Supplements 10

11 Portfolio strategy Commodity generics Highly competitive, rapid price erosion, low margin Key success factors Low cost supply chain/vertical integration Efficient R&D Low cost API Low cost manufacturing Broad portfolio Broad geographic coverage Recent activities Indian partnerships Intas, Strides, Zydus Cadila Internal development Vertical integration ROVI/continued geographic expansion Branded generics Moderately competitive, orderly market, longer life cycle, higher margins Key success factors Product/sales differentiation provides barrier to entry Low cost supply chain Some clinical sales required Recent activities Paxene arrangement with Ivax MVI acquisition in US Biogenerics partnership with PLIVA Balance portfolio and profitability Specialty proprietary Little competition, high margins, long life cycle Key success factors Product efficacy/differentiation Intellectual property protection Clinical selling capability Recent activities In-licensing activities in Australia (Kytril, ELIGARD ) 11

12 Current supply chain R&D API sourcing and development Fill and finish manufacturing Strong internal pipeline Oncology specialisation Over 200 R&D staff located globally Regional expertise in regulatory and IP Existing capabilities Paclitaxel API processing facility, Boulder, USA Close relationships with selected external API suppliers FDA approved injectable manufacturing facilities in each of three core regions Mulgrave, Australia Wasserburg, Germany Aguadilla, Puerto Rico Strong cytotoxic capabilities at Mulgrave 12

13 Product pipeline Country Launches and Local Market Value* (LMV) LMV ($USm) 2,500 2,000 1,500 1, , , , Country launches 0 0 FY05 FY06 FY07 Approved Submitted Pending submission Country launches * IMS data MAT June 04 13

14 Mayne Pharma: 1H05 revenue growth Revenue ($USm) H03 1H04 2H04 1H05 Asia Pacific Americas EMEA Discontinued Continuing business revenue increased 38.3% on 1H04 to $US million Strong growth in Americas and EMEA driven by: New product launches Acquisitions undertaken in FY04 (paclitaxel trifecta, MVI and Wasserburger) Note: $AU amounts converted to $US at $US 0.70/$AU

15 Pharma: 1H05 EBITA growth ($USm) EBITA* 22.0% 22.3% % 18.1% 18.8% 17.3% 20% 15% % 5% 0% 2H03 1H04 2H04 1H05 EBITA (excluding significant items) EBITA (including significant items) EBITA margin (including significant items) EBITA Margin (excluding significant items) EBITA** growth 44% on 1H04 EBITA margin** of 18.8% in mid-range of guidance of 17-20% 2H04 margin higher due to inclusion of $US 3.0 million Mylan settlement * Continuing business ** Excludes significant items Note: $AU amounts converted to $US at $US 0.70/$AU

16 The Indian opportunity 16

17 Pooling of strengths Global sales and marketing and regulatory expertise High quality, low cost R&D and supply chain 17

18 Global distribution platform Direct presence Distribution arrangements Mayne has a unique global footprint in generic injectable pharmaceuticals 18

19 Leading market positions EMEA Emerging Leader* 46% revenue Market leading position in generic injectables in continental Europe and UK #1 generic injectable oncology in UK & France #2 generic injectable oncology in Germany & Italy Only pan European generic injectable sales force Asia Pacific Regional Leader 27% revenue Clear market leader in generic injectable pharma in Australia Established positions in Thailand, Malaysia, Korea, Singapore, Taiwan, Hong Kong and China Americas Growing Presence 27% revenue Emerging US business: #4 in generic injectable oncology #2 generic hospital player in Canada Mayne has leading market positions around the world in generic hospital pharmaceuticals Source: IMS data adjusted for discounts & Mayne data. *Ranking excludes Spain, Portugal, Ireland, Greece. 19

20 Regulatory expertise Global expertise in regulatory and IP across all major markets Over 50 people employed in regulatory affairs in more than 15 countries Increased returns from having same product approved in different jurisdictions Five of top ten generic products are registered in all three regions Innovative and novel routes to product approval E.g. Multiple strengths and/or presentations

21 India s quality credentials Highly skilled and motivated scientists Experts in process chemistry through long history of reverse engineering molecules Growing experience with FDA / MHRA compliance High quality manufacturing facilities with relatively low capacity utilisation

22 India s low-cost advantage Raw Materials Utilities Infrastructure Wages Others Total Europe / US cost Indian cost Cost benefits of API vertical integration are not incorporated in the table Savings of 35% in cost benefits can be realised in raw materials (conservative estimate) Estimated savings in total typical costs of production: >40% Intellectual property (IP) constrains several key molecules from manufacture in Australia India provides an IP advantage to enable earlier commencement of manufacture to meet emerging markets Source: UBS report

23 R&D R&D API sourcing and development Fill and finish manufacturing Maintain control of strategically important molecules Seeking relationships for R&D in low cost and generic-friendly environments Leverage Mayne s regional expertise in regulatory and IP Recent developments February 2005: Agreement with Strides Arcolab to develop and manufacture a range of anti-infective products for Mayne to distribute in the US and Europe December 2004: Agreement with Strides Arcolab to contract develop and manufacture six specialised injectable, non-cytotoxic products for Mayne to market and distribute in the US market September 2004: Intas development and contract manufacturing agreement for an important cytotoxic pipeline product 23

24 API sourcing and development R&D API sourcing and development Fill and finish manufacturing Vertically integrate into API development and manufacturing for strategically important molecules In-source v out-source: Balancing of objectives Low development costs Security of IP Reliability of supply Margin enhancement Recent developments December 2004: Zydus Cadila MOU to evaluate API and fill and finish manufacturing facility in India December 2003: Acquisition of Napro s US paclitaxel API business 24

25 Fill and finish manufacturing R&D API sourcing and development Fill and finish manufacturing Control manufacturing of core molecules Existing manufacturing facilities continued investment Partnership or direct ownership in developing countries Contract manufacturing of Non-core products Commodity or low value products Products in areas where Mayne has chosen not to develop expertise Recent developments December 2004: Zydus Cadila MOU to evaluate API and fill and finish manufacturing facility in India September 2004: Intas contract manufacturing agreement 25

26 Summary Seeking to marry Mayne Pharma s unique global sales and marketing capabilities and regulatory expertise with a high quality, globally competitive supply chain R&D API development and manufacturing Fill and finish manufacturing Mayne is positioning itself for long term success

27 Mayne Group Limited ABN AMRO Global Generic Pharmaceutical Conference Mr Mark Bisset Vice President Global Business Development 9 March 2005 Mumbai, India