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Orion Investor presentation Updated on 26 April 2019
Disclaimer
This presentation contains forward-looking statements which involve risks and uncertainty factors.
These statements are not based on historical facts but relate to the Company’s future activities and
performance. They include statements about future strategies and anticipated benefits of these
strategies.
These statements are subject to risks and uncertainties. Actual results may differ substantially from
those stated in any forward-looking statement. This is due to a number of factors, including the
possibility that Orion may decide not to implement these strategies and the possibility that the
anticipated benefits of implemented strategies are not achieved. Orion assumes no obligation to update
or revise any information included in this presentation.
Investor Presentation © Orion Corporation 2
Content
1) Orion in brief
2) R&D
3) Highlights of 1−3/2019
4) Outlook and financials
5) Businesses
6) Sustainability
7) Financial calendar
Investor Presentation © Orion Corporation 3
Orion in brief
Key messages
11 3 5
Orion develops, Growth targeted Strong position in
manufactures and through new in- the Nordic
markets human house developed generics market.
and animal drugs.
pharmaceuticals,
and APIs. Products
marketed in >100
countries.
6
Core therapy
22 4 4
Balanced business Strong
model: Both areas in R&D: profitability,
proprietary drugs oncology, CNS
and respiratory stable dividends.
and generics.
diseases
(Easyhaler
family).
Investor Presentation © Orion Corporation 5
Orion at a glance (2018 figures)
Net sales
Sales by business Sales by market area
977 MEUR
Operating profit 5% 2% 15%
8%
253 MEUR 37% 32%
6%
Personnel
3,154
R&D investments
48% 31%
104 MEUR 16%
6 production sites in Finland Proprietary Products Finland
Scandinavia
Specialty Products
Other Europe
Own sales unit Animal Health
North America
Fermion
in 26 European countries Contract manufacturing
ROW
On 21 April 2018, Orion signed an agreement on the sale of all shares in Orion Diagnostica Oy (i.e. the Orion Diagnostica business division). Following the transaction, that was
completed on 30 April 2018, Orion Diagnostica business is reported as discontinued operation. All figures in this presentation are for continuing operations, if not otherwise stated.
Investor Presentation © Orion Corporation 6
Steady development despite patent expiries
Net sales Operating profit
EUR million EUR million
33%
1 000 11% 300
32%
9% 250
800 7% 31%
5% 200 30%
600 29%
3% 150
400 1% 28%
100
200 -1% 27%
-3% 50 26%
0 -5% 0 25%
2011 2012 2013 2014 2015 2016 2017 2018
Parkinson franchise + Precedex Operating profit
Other products Operating profit margin
Growth, %
On 21 April 2018, Orion signed an agreement on the sale of all shares in Orion Diagnostica Oy (i.e. the Orion Diagnostica business division). Following the transaction, that was
completed on 30 April 2018, Orion Diagnostica business is reported as discontinued operation. All figures in this presentation are for continuing operations, if not otherwise stated.
Investor Presentation © Orion Corporation 7
Orion’s product mix has changed
Sales by business 2011 Sales by business 2018 Net sales, EUR million
3% 5% 2%
5% 1 200
8% 8% 1 050
47% 37% 900
750
600
450
37% 48% 300
150
0
Proprietary Products Specialty Products
Animal Health Fermion
Contract manufacturing & other
Investor Presentation © Orion Corporation 8
Our businesses
1
Proprietary Products Specialty Products
In-house developed drugs and
other drugs with valid product
3 Generic prescription drugs,
OTC and non-medicinal
5
protection products, biosimilars
Animal Health Fermion
Medicine and well-being Active pharmaceutical
products for animals ingredients (APIs)
2 4 4 6
Contract Manufacturing
Production for other
pharmaceutical companies
Investor Presentation © Orion Corporation 9
Orion’s strategy – Mission to build well-being
Growth
Sustainability
Investor Presentation © Orion Corporation 10Orion had ~73,000 shareholders on 31 December 2018
By number of shares By number of votes
Households (Finnish
5% retail) 3%
5% 9%
Non-Finnish holders and
8% nominee-registered 6%
Private corporations
7% 42% 13%
Public sector
62%
Non-profit institutions 7%
32% Financial and insurance
corporations
Other
Investor Presentation © Orion Corporation 11Research and development
Focus areas of Orion’s R&D
Proprietary products Animal Health Fermion
• Central nervous system • Orion utilises the R&D of • APIs to Orion’s
• Oncology proprietary products to proprietary products
• Respiratory develop new medicines • Generic APIs
(Easyhaler product for animals. • Contract development
family) for pharmaceutical
companies
Investor Presentation © Orion Corporation 13Together we can achieve more in R&D
Late stage
Research Early development
development
Target Hit to Lead Lead Candidate Phase I Phase II Phase III
identification generation optimisation selection,
and validation preclinical
development
8‒24 mo. 12‒24 mo. 18‒36 mo. 12‒24 mo. 12‒14 mo. 12‒36 mo. 18‒48 mo.
Collaboration with partners Collaboration with partners
Investor Presentation © Orion Corporation 14Orion's key clinical drug development projects
Project Indication Phase Registration
Easyhaler® tiotropium COPD Bioequivalence study
Darolutamide 1) Prostate cancer (nmCRPC) I II III
Darolutamide 1) Prostate cancer (mHSPC) I II III
ODM-109 (oral levosimendan) ALS I II III
ODM-203 (targeted FGFR+VEGFR inhibitor) Solid tumours I II
ODM-207 (BET protein inhibitor) Cancer I
ODM-208 (CYP11A1 inhibitor) Prostate cancer (CRPC) I
Prostate cancer (CRPC), I
ODM-209 (CYP11A1 inhibitor) breast cancer
I
1) In collaboration with Bayer
= Completed =Status changed
More information on R&D projects: www.orion.fi/en/rd/orion-rd/pipeline/
= Ongoing
Interim Report 1–3/2019 ©Orion Corporation 25 April 2019 15ARAMIS trial: Efficacy and safety of darolutamide in non- metastatic castration- resistant prostate cancer
Orion and Bayer’s phase III trial
of darolutamide for
non-metastatic castration-
resistant prostate cancer
● Detailed data presented at ● Bayer is also having discussions with
the ASCO GU on 14 February 2019 other health authorities regarding the
and simultaneously published in the submission for marketing authorisation
New England Journal of Medicine. application.
● Darolutamide significantly extended ● Darolutamide has been granted Fast
metastasis-free survival with a Track designation by the U.S. Food and
favourable safety profile compared Drug Administration (FDA). If the
to placebo. process proceeds as planned, the sales
could in the best-case scenario start in
● The application for marketing
the US already at the end of 2019.
authorisation has been submitted in
U.S., Japan and EU. ● Phase III ARASENS trial for metastatic
prostate cancer continues.
Investor Presentation © Orion Corporation 17Financial impacts of
darolutamide
● Bayer has the right to commercialize
darolutamide globally.
● Orion has the option of co-promoting in Europe.
Orion will manufacture the product.
● Milestone payments upon first commercial sales:
• EUR 45 million in the US
• EUR 20 million in the EU
• EUR 8 million in Japan
● Tiered royalties on product sales
− Approx. 20%, including production revenue.
● Potential one-off payments
if certain sales targets are met.
Investor Presentation © Orion Corporation 18Non-metastatic
castration-resistant
prostate cancer (nmCRPC)
● A form of prostate cancer associated with
rising PSA (Prostate-Specific Antigen) levels
despite androgen deprivation therapy (ADT).
● The cancer has not yet spread
beyond the prostate region.
● High risk for progression to metastatic disease.
● Until recently, there have been no effective
treatment options for this stage. The goal is to
achieve disease control without impacting
patients’ daily lives.
Investor Presentation © Orion Corporation 19Until recently, there have been no effective treatment
options for CRPC patients who have rising Prostate-Specific
Antigen (PSA) levels while on ADT and no detectable
metastases
Non-metastatic CRPC
20Darolutamide has demonstrated
low blood-brain barrier penetration
that may lead to lower incidence of adverse events
● Darolutamide is a non-steroidal
androgen receptor antagonist that
binds to the receptor with high
affinity and inhibits the growth of
prostate cancer cells.
● In preclinical studies, darolutamide
has demonstrated low blood-brain
barrier penetration.
● This may explain the overall low
incidence of central nervous
system related adverse events.
Investor Presentation © Orion Corporation 9ARAMIS Phase III trial design
1,200 mg darolutamide + ADT
Randomization
1,509 patients (600 mg twice a day)
− 955 patients
Men with nmCRPC currently
2:1
being treated with ADT, and
at high risk for developing
Placebo twice a day + ADT
metastatic disease
− 554 patients
Primary endpoint Secondary endpoints
● Metastasis-free survival (MFS) ● Overall survival (OS)
● Time to pain progression
● Time to initiation of first cytotoxic chemotherapy
● Time to first symptomatic skeletal event
● Safety and tolerability
11Summary of results:
Darolutamide shows substantial
efficacy and favourable
safety profile
● Darolutamide significantly improves ● Darolutamide has a favorable
metastasis-free survival (MFS): safety profile:
– Median 40.4 months with darolutamide – It didn’t increase rates of critical adverse
vs 18.4 months with placebo events (seizures, falls, fractures, rash,
cognitive disorder, mental impairment,
– Overall improvement of 22 months hypertension) compared to placebo.
● Positive trend in overall survival (OS): – Only fatigue occured in >10% of patients.
– 29% reduction in risk of death at interim – Discontinuation rates similar between
analysis (P=0.045). darolutamide and placebo.
● Significant benefit over placebo for
time to pain progression:
– 40.3 months vs. with placebo 25.4 months
Investor Presentation © Orion Corporation 13ARASENS trial continues in order
to expand the indication to
metastatic prostate cancer
Patients Endpoints
● Men with metastatic, hormone-sensitive ● Primary:
prostate cancer Darolutamide over placebo
Treatment in overall survival
● Darolutamide plus ● Secondary:
androgen deprivation therapy Time to castration resistance, time to
and six cycles of docetaxel (chemotherapy) antineoplastic therapy, time to first
symptomatic skeletal event, time to
initiation of opioids, time to pain
progression, and to characterize the safety
and tolerability of darolutamide
Status
● Recruitment finalized,
estimated completion of the trial in 2022.
24
Investor Presentation © Orion CorporationGlobal prostate cancer estimates (2018)
70
12nd 35th 5
most commonly leading cause of
diagnosed death from cancer
malignancy in men 50 60 70 80
in men worldwide
50 60 70 80
21.2
million men
358,000
died from
4 6
50+
Mainly affects men
diagnosed with the disease over 50, the risk
prostate cancer increases with age
Investor Presentation © Orion Corporation 25ODM-109: Oral levosimendan
for ALS
● First patients recruited in July ● The aim is to apply for marketing authorisation
for the Phase III clinical trial (REFALS). in the US and Europe.
● By enhancing respiratory muscle function ● Levosimendan has been granted an Orphan Drug
in ALS patients, orally administered Designation in the US and in the EU.
levosimendan can help maintain breathing ● It is a molecule originally developed by Orion for
capacity and benefit overall functioning the treatment of acute decompensated heart
of ALS patients. failure. Simdax has been in the market for this
● Orion is investing approximately EUR 60 million indication since 2000.
over three years in the trial.
Investor Presentation © Orion Corporation 26ODM-109 (ALS):
REFALS phase III trial
450 patients Primary endpoints
• Levosimendan • 12 weeks:
1-2mg/day Slow vital capacity
(300 patients) (Breathing
• Placebo capacity compared
to normal subjects)
(150 patients)
• 48 weeks:
Approx.100 clinical sites ALS functional rating
scale (Overall
• US, Canada, assessment of
Europe,
ALS symptoms)
Australia
www.clinicaltrials.gov: NCT03505021
Investor Presentation © Orion Corporation 27ALS (Amyotrophic lateral sclerosis)
as a rare disease
1−2∕ ~16,800 ~12,500 ~450−500
100,000 Patients
Incidence Patients Patients
in the US in 2017 in Europe in Finland
Investor Presentation © Orion Corporation 28ODM-208: Pan-steroid hormone synthesis inhibitor
(CYP11A1 inhibitor) for castration-resistant prostate cancer
● Steroid hormones stimulate the growth of
hormonally regulated cancers, such as most
prostate and breast cancers.
● Hormonal treatments are highly effective, but Steroid producton
drug resistance will often eventually emerge switched off
and cancer will start growing again.
● Preclinical studies have shown that ODM-208 Steroids from
inhibits the synthesis of steroids hormones. It adrenal, testes
and tumor
has potential efficacy also for those cancers
that have become resistant to the standard
ODM-208
hormonal treatments. with
androgen
● The steroid hormones that are needed and do deprivation
not promote cancer growth are replaced with therapy
additional medication.
Investor Presentation © Orion Corporation 29Highlights in January–March 2019
Marketing authorisation applications for darolutamide
submitted in main markets
1 Marketing authorisation
applications for the prostate
cancer drug darolutamide
3 Net sales of Proprietary
Products slightly declined from
the previous year. Easyhaler,
submitted in the main markets Dexdor and Simdax sold well.
US, Japan and Europe. Net sales of Specialty Products
decreased in Finland and
Eastern Europe, but increased
in Scandinavia.
Net sales and operating profit Orion has launched a Phase I
2
were lower than in the
comparative period.
R&D expenses increased.
4 clinical trial on the ODM-209
molecule. This molecule is a
selective hormone synthesis
inhibitor much like the ODM-208.
Outlook remains unchanged.
Orion will not independently
pursue a trial on ODM-104 for
Parkinson's disease.
Investor Presentation © Orion Corporation 31Key strategic target in 2019−2023:
Growing more rapidly than the growth in the market
1
Net sales target Own investments in Investments in sales
in 2025 new clinical trials: and marketing:
E.g. strengthening
1.5
E.g. EUR 60 million
investment in the Easyhaler
Phase III trial on ALS product family
(REFALS). sales force in Germany.
billion EUR
In-licensing and Investments
4
Capital gain from
2
the sale of Orion product acquisitions: supporting growth
Diagnostica, estimated
E.g. reacquisition of at EUR 30 million
EUR 128 million, Stalevo sales rights
supports growth in 2019.
in Europe.
opportunities.
Investor Presentation © Orion Corporation 32Key figures 1−3/2019
Net sales Operating profit Operating profit Cash flow per share
margin before financial
items
241 55 23% 0.40
MEUR (247) MEUR (70) (28%) EUR (0.39)
-3% -21% +3%
Investor Presentation © Orion Corporation 33Development of net sales and operating profit
Net sales Operating profit
247 7 3
70 1 2 3
3 2 1 3
2 4 241 7
55
26 26 25 22 15
15
(1) Product sales without sales margin and product mix change and exchange rate
effect
(2) Product sales margin and product mix change but without exchange rate effect
(3) Exchange rate effect on gross margin
Investor Presentation © Orion Corporation 34Geographical breakdown and development of net sales
1−3/2019 1−3/2018 1−3/2019
EUR million
11% +10%
90 -7%
6% 31% 80
70
60 +7%
50
-29%
40
34% 18% 30
-1%
20
Finland
10
Scandinavia
Other Europe 0
North America Finland Scandinavia Other North Other
Other markets Europe America markets
Investor Presentation © Orion Corporation 35Net sales by business division
EUR million 1−3/2019
-5%
140 2%
118 6%
120 111 -4%
9%
100 89 93
37%
80
60
+3%
+21% 46%
40 +8%
21 20
20 15 12
5 4
0 Proprietary Products
Specialty Proprietary Animal Fermion Contract Specialty Products
Products Products Health manufacturing Animal Health
& other
Fermion
1−3/2019 1−3/2018 Contract manufacturing & other
Investor Presentation © Orion Corporation 36Best-selling pharmaceuticals 1–3/2019 Net sales Change vs
. Indication (EUR million) 1−3/2018
1. Asthma, COPD 26 +21%
2. Parkinson’s disease 21 -25%
3. Intensive care sedative 19 +10%
4. Acute heart failure 17 +16%
5. Animal sedatives 10 +15%
Rheumatoid arthritis, inflammatory
6. Biosimilars bowel diseases, lymphoma
9 -12%
7. Inflammatory pain 6 +5%
8. Divina series Menopausal symptoms 5 +8%
9. Anticoagulant 3 -24%
10. Generic entacapone products Parkinson’s disease 3 -29%
= Products of Proprietary Products business division
Investor Presentation © Orion Corporation 37Proprietary Products
Easyhaler became the top proprietary product
EUR million 1−3/2019
+21% -25%
30 28
26 3% 3%
+10%
25
22 21 19%
+16% 24%
20 19 18 17
15 14
10 -52% 22%
5 29%
5 3
Parkinson's: Stalevo, Comtess & Comtan
0 Easyhaler
Easyhaler Parkinson's Dexdor Simdax Precedex Dexdor
family drugs
Simdax
Precedex
1−3/2019 1−3/2018 Others
Investor Presentation © Orion Corporation 39Easyhaler product family will be a key
source of growth in the next few years
● Budesonide-formoterol Easyhaler
Sales, EUR million continued strong growth.
30
● Product family total sales: +21%
25
● Budesonide-formoterol Easyhaler: +35%
20
– Strong market position in some countries,
15 such as Sweden (market share was 34%* in
February).
10 – Growth still attainable in certain markets.
Investments in sales and marketing made
5 particularly in Germany (market share was
0
7%* in February).
Q1Q2Q2Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4 Q1 ● Salmeterol-fluticasone sales started in the
2019
first European countries in late 2018.
2014 2015 2016 2017 2018
Budesonide-formoterol Easyhaler Others ● Development of seventh product, tiotropium,
continues.
*) Market shares of sales in EUR. Investor Presentation © Orion Corporation 40Orion is taking over the sale of its proprietary
Parkinson’s drugs in Europe Breakdown of sales of
Orion's branded Parkinson's
drugs by market area
50
Sales, EUR million
45
40 2%
35
30
25 31%
20 34%
15
10
5
0
Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4 Q1
2014 2015 2016 2017 2018 2019 Europe 33%
Japan
Deliveries of Parkinson's drugs (Stalevo, ROW
Comtess/Comtan) to key partners
USA
Orion's own sales Source: IQVIA, MAT12/2018
Investor Presentation © Orion Corporation 41Sales of Dexdor intensive care sedative continued to grow –
patent expired at the end of March
Total value of European
sedatives market:
EUR 569 million (+3%)
Sales, EUR million
20
18 12%
16
14 12%
12 65%
10
8
11%
6
4
2
0 Propofol EUR 368 million (+4%)
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Midazolam EUR 62 million (-3%)
Dexmedetomidine EUR 70 million (+8%)
2014 2015 2016 2017 2018 2019 Remifentanil EUR 69 million (+4%)
Source: IQVIA, MAT 12/2018
Investor Presentation © Orion Corporation 42Specialty Products
Specialty Products: price competition continued especially
in Finland
Development of net sales Net sales by region Net sales by product
EUR 1−3/2019 1−3/2019
million -4%
80
68 10% 8%
70 65
60 12%
50 58% 26% 66%
40 +6%
-8%
30 22 21
20 14 15 20%
10
0
Finland Scandinavia Eastern
Finland Generic drugs
Europe and
Scandinavia Self-care products
Russia
1−3/2019 1−3/2018 Eastern Europe and Russia Biosimilars
Other markets
Investor Presentation © Orion Corporation 44In Finland, price competition has led to a decline in the
entire market of reference priced prescription drugs
The market of reference priced The sales of Orion's reference
prescription drugs in Finland priced prescription drugs
(1–3/2019) in Finland
MEUR 106 (118) MEUR 28 (30)
Market development Orion's development
-10% -7%
Source: Pharmarket sales statistics 1–3/2019 Investor Presentation © Orion Corporation 45Orion is strong in home market Finland
Human pharma market in Finland 1−3/2019 Self-care
Medicinal and non-medicinal products Reference
priced products
in hospital and pharmacy channels: EUR 676 million
prescription Orion market share in
EUR million drugs pharmacy
80 76 Orion
70
60
24
market share in
pharmacy
24%
26%
45 (24%)
50
40
30 26 Human
25 25 26 (26%) pharmaceuticals
30
20 total
Orion market share
10 in hospital &
0 pharmacy
11%
Ratiopharm Sanofi Bayer Roche MSD Orion
Self-care products (pharmacy channel)
Reference priced prescription drugs (pharmacy channel) (12%)
Source: Pharmarket sales statistics 1–3/2019 Investor Presentation © Orion Corporation 46Orion's key business targets in 2019
1. Preparation for the • Marketing authorisation applications
commercialisation of submitted in main markets.
darolutamide. ARASENS trial
(metastatic prostate cancer) • With recruitment completed, the
continues in order to expand the ARASENS trial continues as planned.
indication for the molecule.
2. Development of • Patient recruitment is proceeding as
orally administered planned
levosimendan (ODM-109)
(REFALS) for ALS in phase III
clinical trial and preparation for
its possible commercialisation.
3. Strengthening Orion’s • Orion’s sales volume in Finland grew
position as the most faster than the market.
significant provider of generic
drugs in Finland. Competitive
pricing.
47Orion's key business targets in 2019
4. Competitive product portfolio in • Orion's sales volume in Finland grew
Specialty Products and faster than the market.
strengthening of product
launches.
5. Accelerating the growth of the • Easyhaler product family sales
Easyhaler product family and increased by 21 per cent.
strengthening its market
position.
Salmeterol-fluticasone launch
in Europe.
6. Evaluation of new • The work continues.
in-licensing opportunities
in Europe, particularly in
the area of hospital care.
48Outlook
Investments in growth
EUR 30 million in 2019
● The ongoing projects ● This comprises clearly ● At the same time, operating
supporting growth are increased depreciation as profit is burdened by
expected to burden Orion’s well as investments in intense price competition in
profit in 2019 by an sales and marketing and the market and gradually
estimated EUR 30 million. research. expanding generic
competition for Orion’s old
proprietary drugs.
Investor Presentation © Orion Corporation 50Outlook for 2019
Net sales
Orion estimates that in 2019 net sales will be
+
slightly higher than in 2018
(net sales in 2018 were EUR 977 million).
The estimated net sales include the possible EUR 45 million
milestone payment associated with the commercialisation of
darolutamide.
Operating
=
profit Operating profit is estimated to be at the same level
as in 2018 (operating profit in 2018 was EUR 253 million).
The estimated operating profit includes the possible
EUR 45 million milestone payment associated with
the commercialisation of darolutamide as well as
significant investments in actions to generate growth.
Investor Presentation © Orion Corporation 51Financials
Orion’s financial objectives
Growing net sales more rapidly than
≥
growth of the pharmaceuticals
market. Achievement of this objective
requires continuous investment in
Keeping the equity ratio at least
50%.
development of the product portfolio.
Distributing an annual dividend that
>
Maintaining profitability at a good
level. The aim is operating profit that
exceeds 25% of net sales.
€ in the next few years will be at least
EUR 1.30 per share, and increasing
the dividend in the long term.
Investor Presentation © Orion Corporation 53Financial objectives
Net sales Operating profit Dividend
1 200 8% 30% 1,60
300 27%
6% 275 1,55
1 000 250 24% 1,50
4% 225 21%
800 200 1,45
2% 18%
175 1,40
600 150 15%
0% 125 12% 1,35
400 100 9% 1,30
-2%
75 6% 1,25
200 -4% 50
25 3% 1,20
0 -6% 0 0% 1,15
2016*
2018**
2012
2013
2014
2015
2017
2015
2016
2012
2013
2014
2017
2018
2015
2012
2013
2014
2016
2017
2018
Net sales, EUR Operating profit, EUR million Dividend per share, EUR
million Operating profit margin
Target Target
*) 2016: includes extra dividend EUR 0.20
**) 2018: Board proposal
On 21 April 2018, Orion signed an agreement on the sale of all shares in Orion Diagnostica Oy (i.e. the Orion Diagnostica business division). Following the transaction, that was
completed on 30 April 2018, Orion Diagnostica business is reported as discontinued operation. All figures in this presentation are for continuing operations, if not otherwise stated.
Investor Presentation © Orion Corporation 54Key figures by quarter
Net
Netsales,
sales,EUR
EURmillion
million Operating
Operating profit,
profit, EUREUR million
million
1 500 400
Q4 Q4
1 000 300 59 Q3
273 255 262 280 266 262 Q3 66 55 51 71
200 92 69
237 238 239 259 242 222 67 64 59 55 45 Q2
500 Q2 84 71
248 277 255 273 261 246 100 61 86 74 70 Q1
249 245 260 262 266 247 Q1 74 67 83 80 88 70
0 0
13 14 15 16 17 18 13 14 15 16 17 18
Cash
Cashflow
flowper
pershare
share
Basic Basic earnings
earnings per share,
per share, EUR EUR
before
Before financial items,EUR
financial items*, EUR
2,00 2,50
Q4 0,22 Q4
1,50 0,34 2,00 0,36
0,40 0,29 0,28 0.38 Q3
0,52 0,38 1,50 0,38 0,39 Q3
1,00 0,35 0,32 0,31 0,40
0,35 0,24 Q2 1,00 0,41 0,22
0,41 0,47 0,39 0,44 0,67 Q2
0,33 0,48 0,40 0,46 0,47
0,50 Q1 0,50 0,62 0,29 0,07 1,36
0,29 0,27 Q1
0,39 0,37 0,47 0,45 0,48 0,38 0,19 0,30 0,38 0,29 0,33 0,39
0,00 0,00 0,07
13 14 15 16 17 18 13 14 15 16 17 18
*) continued and discontinued operations
On 21 April 2018, Orion signed an agreement on the sale of all shares in Orion Diagnostica Oy (i.e. the Orion Diagnostica business division). Following the transaction, that was
completed on 30 April 2018, Orion Diagnostica business is reported as discontinued operation. All figures in this presentation are for continuing operations, if not otherwise stated.
Investor Presentation © Orion Corporation 55Key figures
Change
Orion’s key figures 2013 2014 2015 2016 2017 2018 vs. 2017
Net sales, EUR million 1,006.9 1,015.3 1,015.6 1,073.5 1,033.6 977.5 -5.4%
Operating profit, EUR million 267.7 272.4 266.6 314.6 284.1 252.8 -11.0%
Profit before taxes, EUR million 264.0 267.8 262.3 310.9 277.7 248.4 -10.6%
R&D expenses, EUR million 101.9 106.2 108.1 118.2 99.1 104.0 +4.9%
Equity ratio, % 53.6% 52.3% 57.4% 60.8% 64.6% 68.8%
Gearing, % 8.4% -4.7% -9.6% -12.4% -1.9% -17.1%
ROCE (before taxes), % 38.5% 36.6% 35.7% 40.9% 36.2% 44.3%
Return on equity, % 40.3% 41.1% 37.5% 40.3% 34.2% 45.5%
Basic earnings per share, EUR 1.46 1.50 1.48 1.77 1.56 1.40 -10.3%
Cash flow per share before financial
items, EUR 1.02 1.72 1.51 1.62 1.09 2.32 +112.4%
Dividend per share, EUR 1.25 1.30 1.30 1.55* 1.45 1.50 +3.4%
*) 2016: dividend includes extra dividend of EUR 0.20
The figures in the table include both continuing and discontinued operations.
Investor Presentation © Orion Corporation 56Income statement
Change vs.
Formation of profits, EUR million 2013 2014 2015 2016 ADJ.2017 2018 2017
Net sales 1,006.9 1,015.3 1,015.6 1,073.5 1,033.6 977.5 -5.4%
Cost of goods sold -393.5 -401.7 -405.8 -421.7 -417.6 -387.9 -7.1%
Gross profit 613.4 613.6 609.8 651.8 616.0 589.6 -4.3%
Other operating income and
expenses 5.6 1.7 1.5 24.3 4.9 5.5 +10.8%
Sales and marketing expenses -204.9 -193.4 -190.4 -194.7 -188.9 -195.3 +3.4%
R&D expenses -101.9 -106.2 -108.1 -118.2 -99.1 104.0 +4.9%
Administrative expenses -44.5 -43.3 -46.2 -48.7 -48.8 -43.0 -11.8%
Operating profit 267.7 272.4 266.6 314.6 284.1 252.8 -11.0%
Profit before taxes 264.0 267.8 262.3 310.9 277.7 248.4 -10.6%
Profit for the period for continuing
operations 219.1 197.3 -9.9%
Profit for the period for
discontinued operations 7.0 132.9
Profit for the period 206.2 211.3 208.2 249.0 226.0 330.3 +46.2%
The figures in the table include both continuing and discontinued operations.
Investor Presentation © Orion Corporation 57Financial position
Change Change
EUR million 12/18 12/17 % EUR million 12/18 12/17 %
Non-current assets total 418.5 434.7 -3.7%
Inventories 222.1 225.4 -1.5% Equity total 773.1 679.7 +13.7%
Interest-bearing non-current
Trade receivables 188.8 199.0 -5.1% liabilities 0.6 150.3 -99.6%
Other receivables 33.7 32.4 +4.0% Non-current liabilities total 59.8 196.2 -69.5%
Cash & cash equivalents &
money market investments 283.7 164.1 +72.9% Current liabilities total 313.8 179.7 +74.7%
Current assets total 728.2 620.8 +17.3% Liabilities total 373.6 375.8 -0.6%
Assets total 1,146.7 1,055.5 +8.6% Equity and liabilities total 1,146.7 1,055.5 +8.6%
The consolidated statement of financial position includes both continuing and discontinued operations.
Investor Presentation © Orion Corporation 58Development of capital expenditure
Orion Capex, EUR million
90
80
70
60
50 Property, plant and equipment
40
30 Intangible assets
20
Depreciation, amortisation and
10
impairment
0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Investor Presentation © Orion Corporation 59Development of net working capital
% of net sales EUR million
40% 400
30% 300
20% 200
10% 100
0% 0
-10% -100
-20% -200
-30% -300
2012 2013 2014 2015 2016 2017 2018 2012 2013 2014 2015 2016 2017 2018
Receivables Receivables
Inventories Inventories
Short-term non-interest bearing liabilities Short-term non-interest bearing liabilities
Net Working Capital Net Working Capital
Investor Presentation © Orion Corporation 60Dividend distribution policy
• Orion’s dividend distribution takes into account distributable
funds and capital expenditure and other financial requirements
in medium and long term to achieve the financial objectives.
EUR Dividend distribution history
1,75 100%
1,50 0,06 0,12 95%
1,25 90%
0.10
85% Repayment of capital per share
1,00
80%
1,50
0,75 Dividend per share
75%
0,50 70% Dividend payout ratio
1.30
1,00
0,95
1,00
1,20
1,30
1,30
1,25
1,30
1,55
1,45
0,25 65%
0,00 60%
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2016: includes extra dividend EUR 0.20
2018: Board proposal
Investor Presentation © Orion Corporation 61Orion B share performance January 2016 – December 2018
Index 31/12/2015=100
200
Orion B 94.71
190
Orion B total return 104.10
180
Europe/Pharmaceutical 86.94
170
OMXH-Portfolio 107.2
160
150
140
130
120
110
100
90
80
70
60
31.12.15
29.2.16
30.4.16
30.6.16
31.8.16
31.10.16
31.12.16
28.2.17
30.4.17
30.6.17
31.8.17
31.10.17
31.12.17
28.2.18
30.4.18
30.6.18
31.8.18
31.10.18
31.12.18
Investor Presentation © Orion Corporation 62Business units
Proprietary Products: In-house developed prescription
drugs with valid product protection
Net sales
EUR million
400 Global sales and
Other
350 R&D partner
Simdax networks
300
250
Easyhaler
200
150 Dexdor
100
Precedex Key drivers:
50
0 Stalevo/Comtess Easyhaler, Simdax Generic competition
2012 2013 2014 2015 2016 2017 2018 /Comtan
Possible milestones
New products from
R&D pipeline
Investor Presentation © Orion Corporation 64Proprietary human pharmaceuticals developed by Orion
Product Indication Year Year Indication
Sedative for ICU use 2011 Salmeterol-
2018
fluticasone Easyhaler®
Parkinson’s disease 2003
Budesonide-
Acute decompensated 2014
2000 formoterol Easyhaler®
heart failure
Formoterol Easyhaler® 2004 Asthma and COPD
Sedative for ICU use 1999
Budesonid Easyhaler® 2002
Parkinson’s disease
1998
Beclomet Easyhaler® 1994
Breast cancer 1988
Buventol Easyhaler® 1993
Investor Presentation © Orion Corporation 65Diverse treatment options for
asthma and COPD by utilizing
the same inhaler technology
● Easyhaler is a dry-powder inhaler developed
in-house
● Orion has developed Easyhaler-adapted dry
powder formulations of several well-known
generic active substances:
– salbutamol, beclometasone, budesonide,
formoterol, salmeterol and fluticasone
● Key benefits:
– Dosing accuracy and consistent deposition
– Easy to teach, learn and use
– A wide range of products
Investor Presentation © Orion Corporation 66Easyhaler product family is expanding
2018
Tiotropium
development
started
Investor Presentation © Orion Corporation 67Specialty Products: Generic prescription drugs, biosimilars and OTC
including also non-medicinal products
EUR million
550 22%
500 20% Portfolio of
18%
450 16% hundreds
14%
400
12% of products
350 10%
300 8%
6%
250 4%
200 2%
0%
150 -2%
100 -4%
50 -6%
-8%
0 -10%
Net sales Growth, %
Investor Presentation © Orion Corporation 68Animal Health
EUR million
105 12%
In-licensed products
90 10%
sold in own sales
75 8% areas
6%
60
4%
45
2%
30 0%
15 -2%
0 -4%
In-house developed Medicinal and non-
2012 2013 2014 2015 2016 2017 2018
proprietary products medicinal products for
Net sales Growth, % sold globally through companion animals
own sales network and livestock
and through partners
Investor Presentation © Orion Corporation 69Fermion has an important strategic role
EUR million
70 50%
60 40% Active
50 30% pharmaceutical
40 20%
ingredients (APIs) for
Orion’s own
30 10% Proprietary Products
20 0%
10 -10%
0 -20%
2010
2011
2012
2013
2014
2015
2016
2017
2018
Generic APIs for Contract
Orion and other development and
Net sales* Growth, %
pharma companies manufacturing of
APIs
*) Excluding supply to Orion
Investor Presentation © Orion Corporation 70Fermion's new production plant operational in Hanko
– nearly 100% of production is exported
● Special expertise in demanding production
of active pharmaceutical ingredients (APIs),
e.g. extremely potent substances.
● The aim is to captively manufacture
the APIs for Orion's in-house developed
proprietary drugs, such as darolutamide.
● Modernised, advanced technology at Hanko
EUR >30 6,000 200-> ~20 strengthens Fermion's global competitive
position, meets increasingly strict regulatory
million m2 300 t requirements and provides the means to
meet growing demand.
Expansion Production facility Enables Number of APIs
investment and equipment capacity manufactured ● The Hanko facility manufactures
2016−2018 for the production increase at Hanko azathioprine and entacapone, among
of APIs
others, in which Fermion is the leading
manufacturer globally.
Investor Presentation © Orion Corporation 71Contract manufacturing & other
EUR million
50%
40 35%
Pharmaceutical
20% manufacturing for
30
5% other companies
-10%
20
-25%
10 -40%
-55%
0 -70%
2012 2013 2014 2015 2016 2017 2018
Net sales Growth, %
Investor Presentation © Orion Corporation 72Sustainability is built into Orion’s mission
Material themes of Orion’s sustainability
• Patient safety
• Ensuring reliable supply of medications
• Manufacturing medications in an
environmentally sustainable way:
efficient use of materials, energy
efficiency, wastewater management
Customer Audits undertaken Energy Energy savings
Injury rate
complaints by Orion savings target set for 2025
(Pharmaceuticals) achieved
56 238 1,074 40% 5.5
Ppm (64) (314) MWh (3,725) (31%) LTIF 1 (6.3)
Investor Presentation © Orion Corporation 74We assess product safety throughout the lifecycle
Investor Presentation © Orion Corporation 75Orion calendar Capital Markets Day Helsinki, 22 May 2019 Half-Year Financial Report 17/7/2019 Interim Report 1−9/2019 23/10/2019
Investor Relations Jari Karlson CFO jari.karlson@orion.fi +358 10 426 2883 Heidi Ahti Executive Assistant (Investor meeting requests) heidi.ahti@orion.fi +358 10 426 2169 www.orion.fi/EN/Investors twitter.com/OrionCorpIR
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