UCB moving ahead to become patient-centric biopharmaceutical leader
- For 2011: Gross dividend + 2% of EUR 1.00 per share
- Outlook 2012 confirmed:
- Total revenue of approximately EUR 3.1 billion; recurring EBITDA of approximately EUR 630-660 million, core earnings per share of EUR 1.60 -1.70.
- Continued growth of Cimzia®, Vimpat® and Neupro® as well as post-exclusivity expiry erosion for Keppra®
- All resolutions passed the Annual General Meeting
Brussels (Belgium), April 26, 2012 – 6.00 p.m. (CET) – Today, UCB held its Annual General Meeting (AGM). During the course of this meeting Roch Doliveux, Chief Executive Officer UCB, gave the shareholders of UCB an overview of the financial year 2011 and the interim report for the first three months of 2012.
“Dear Shareholders and friends of UCB,
Persevering with a targeted and consistent strategy is the key to success. For more than eight years, we have been paving the way for sustainable growth, by embarking on a top-to-bottom overhaul of UCB as part of a planned strategy to make UCB one of the world’s leading biopharmaceutical companies. Today, we can say that the decisions we made back in 2004, 2005 and 2006 are bearing fruit and clearly leading us down the path to growth. By counting in particular on the potential of three drugs, the names of which are, by now, more than familiar to you, namely Cimzia®, Vimpat® and Neupro®
, and by building one of the most productive R&D organisations in our industry, we have turned UCB into a biopharmaceutical company which can look to the future with confidence. Evidently, a transformation of this kind only means something if it benefits the men and women central to everything we do, namely those who live their lives with a serious disease of the central nervous or immune system, as well as their families and loved ones. Patients are the driving force behind all of UCB’s initiatives.
2011 was an important year in terms of the acceleration of our growth. Our core medicines Cimzia®, Vimpat® and Neupro® made rapid progress and have already enabled us to provide more than 300,000 patients worldwide with treatment. We are continuing to win market share from our competitors, and we want to do even better, convinced that the potential of these drugs is even greater because of the unique benefit they can bring to patients.
In addition to these core medicines, our company’s most precious assets when it comes to patients is our pipeline of products in development. A recent analysis carried out by Credit Suisse on research and development productivity in the biopharmaceutical industry demonstrates that UCB’s pipeline is one of the most efficient and promising in relation to our size. We have the means to realise this potential, since no less than 24% of our turnover is invested in research and development, with industrial and financial partnerships enabling us to increase our pipeline even further without spending more. As a result of these considered investments, our passion and scientific excellence, major progress was made in 2011 and during the first few months of 2012.
The solid performance achieved in 2011, the dynamism of our core medicines and the potential of our pipeline form the basis for sustainable growth, without any major patents due to expire for a number of years to come.
Results for 2011
Our turnover in 2011 was 3.24 billion, which puts us in the upper range of our financial market commitments. At €2.87 billion, our net sales are up 3% on 2010. The solid performance of our anti-epileptic Keppra® in 2011, despite competition from generics, and, especially, the remarkable progress of our three core medicines Cimzia®, Vimpat® and Neupro® with combined net sales of €625 million , up 51%, have enabled us to offset the effects of patents expiring.
Cimzia®, our treatment for rheumatoid arthritis and Crohn’s disease (in the United States and Switzerland)) is already proving to be the biggest of the three, with net sales of €312 million in 2011, a rise of 58%. Cimzia®, which is available in 26 countries, was already being administered to more than 33,000 patients worldwide at the end of 2011.
The second biggest new product is Vimpat®, our new anti-epileptic, which saw equally impressive growth in 2011 with sales of €218 million, a jump of 65% on the previous year. By the end of 2011, 171,000 epileptic patients from 25 countries were using it to improve their quality of life.
The third new product is Neupro®, our patch to treat Parkinson’s disease and restless legs syndrome, with sales of €95 million, up 16%. Around 100,000 patients across 28 markets were benefiting from Neupro®. A key milestone was reached a few weeks ago when Neupro® was approved by the FDA in the United States, which represents more than 50% of the worldwide market. UCB will launch Neupro® in the United States in July.
Keppra®, our core anti-epileptic now facing competition from generics, more than stood its ground in 2011. It actually grew by 3%, generating sales of €966 million. The erosion in its sales following patents expiring after the period of exclusivity in North America has been offset by UCB’s leading position, which increased in Europe and grew significantly in Asia. In Japan, where it was launched in September 2010, E Keppra®, which we market together with Otsuka, met with unrivalled success compared with the other anti-epileptics available in the country.
Finally, sales in the major emerging countries, essentially Asia, already make up 15% of UCB’s global sales with a rise of 14% in 2011, which far exceeds local market growth.
With sales up significantly for our core products and effective control of overheads enabling a high level of investment in R&D to be maintained, our financial targets have been more than met, with a net profit of €235 million, which is more than double the figure for the previous year. In fact, investors recognised UCB’s potential in 2011 because, as Euronext pointed out, UCB’s share price saw the highest growth on the Bel20 index during a year marked by uncertainty for the stock markets.
With the emphasis on our long-term potential, the Board of Directors is proposing that we pay a gross dividend of €1 per share, i.e. 2% more than last year.
Pipeline and new prospects
Our business is all about long-term success. That’s why we invest around a quarter of our turnover in research and development. This being the case, UCB invested the most in research and development of any company in Belgium according to the European Commission’s latest annual figures. UCB also became number 1 in Europe across all sectors in terms of R&D expenditure per employee. We constantly optimise our R&D investments to identify the potential of new molecules as quickly as possible and systematically reject those which do not live up to their specifications. We focus on two fields of treatment, namely central nervous system conditions and diseases of the immune system. These two types of indications represent two of the four groups of serious diseases on the increase due to the ageing population. UCB is active in buoyant markets. Considerable progress was made in 2011, giving fresh hope to patients suffering from severe conditions in those fields we target.
UCB is already a leader in the treatment of epilepsy with Vimpat® and Keppra®, not to mention brivaracetam, a new anti-epileptic currently in Phase 3 of development, as well as an innovative treatment aimed at patients with refractory epilepsy currently in Phase 1.
When it comes to immunology, besides Cimzia®, UCB is continuing to add to its portfolio of new drugs. Epratuzumab is being studied for the treatment of systemic lupus erythematosis with two Phase 3 clinical trials for what is a major condition worldwide.
Similar progress has been made by olokizumab, a new molecule for rheumatoid arthritis and other auto-immune diseases. The initial results of the Phase 2b trial are expected in around summer 2012.
Together with our partner Biogen Idec, UCB is developing another potential treatment for systemic lupus erythematosis with another action mechanism. The same molecule is also the focus of a study in association with the Amyotrophic Lateral Sclerosis Therapy Development Institute for the treatment of this disease.
Another major asset in our pipeline, the sclerostin antibody which we are developing in partnership with Amgen, entered Phase 3 just a few weeks ago. The sclerostin antibody is based on a totally innovative new action mechanism which came out of genomic research and which could revolutionise the treatment of bone loss disorders if the trials confirm its potential. GoldmanSachs has named this molecule one of the top ten molecules that can change the pharmaceutical industry.
Despite these treatment advances, we are continuing to develop new indications for Cimzia®, Vimpat® and Neupro®. When it comes to Cimzia®, we recently announced positive Phase 3 results in new indications against various forms of arthritis. With our new partner Astellas in Japan, we also filed to the Japanese authorities for approval for Cimzia®. Vimpat® is in development in several other fields of epilepsy in order to respond even more effectively to the unmet needs of tens of thousands of patients, i.e. monotherapy, paediatric treatment and treatment of primary generalized tonic-clonic (PGTC) seizures. Our partner Otsuka filed with the Japanese authorities for approval for Neupro® at the start of the year.
Our company on the path of excellence
Above and beyond our own innovations, we are continuing to see UCB as the centre of a true ecosystem favouring the advance of medical research at the service of the patient. Innovation cannot happen in isolation today. As part of its “open innovation model”, UCB works with major industrial players, academic institutions and patients’ associations on advancing more than 140 innovative projects.
In 2011, we signed agreements with some of the world’s leading research institutions, including Harvard University in the United States, Leuven University in Belgium and recently with Oxford University in the UK, to stimulate research into the treatment of serious immunological and neurological conditions. These initiatives are one of the building blocks for future innovation.
UCB is also making progress in relation to efficiency. Every euro, dollar, yen or pound spent is being challenged. Our 'Smarter Ways' programme, which promotes improved efficiency and a critical review of the value of each activity, is now part of our company culture. Thanks to our collective efforts, we managed to meet the target we set ourselves at the start of the year, namely to make efficiency savings of €150 million. As well as improving our finances, these savings are also contributing towards our future projects, because they are largely reinvested in our pipeline.
The credit for everything we achieved in 2011 goes to our 8,540 UCB colleagues. Day in and day out, these men and women, representing more than 70 different nationalities united in a joint vision, dedicate their skills, creativity, innovative spirit and discipline to helping patients. They should be commended all the more because they work in a sector where quality, safety and strict observance of the regulations (commonly referred to as “compliance” on both sides of the channel) are fundamental. Our work impacts the lives of patients. Here at UCB, we are dedicated to strict compliance with legal regulations and quality standards. We follow the strict development and production regulations to guarantee that the safety and quality of our products are beyond reproach, by complying with the regulations in force in all of the geographic zones where we operate. Discipline and compliance with standards are in the DNA of our employees.
On behalf of the entire management team and the Board of Directors, I would like to thank all of my dedicated UCB colleagues for their incredible work. I would also like to take this opportunity to express my deep admiration for our colleagues in Japan, who made great efforts to maintain drug supplies in the hours, day and months following the tsunami. In the most difficult conditions, such dedication can make the world of difference.
2012 off to a very good start
This morning, we confirmed our financial forecasts for 2012 after a good first quarter. We predict that in 2012, our results will continue to be stimulated by the growth of Cimzia®, Vimpat® and Neupro®, which will almost offset the anticipated erosion in sales of Keppra® due to increased competition from generics. According to forecasts, our turnover should reach approximately €3.1 billion and underlying profitability (rEBITDA) should be in the region of €630-660 million.
The first few months of 2012 have seen immense progress for our research and development programmes which I referred to earlier (positive Phase 2 results for Vimpat® for the treatment of generalised partial tonic-clonic seizures in epilepsy, approval of Neupro® in the United States, Phase 3 launch of our sclerostin antibody programme and positive Phase 3 results for Cimzia® in further indications). At the same time, we are continuing the marketing process for Cimzia®, Vimpat® and Neupro® in new markets and intensifying our growth in Asia. Continually improving patient access to our treatments is our number one priority.
2012 will also see the opening of our new pilot biotechnology plant in Braine-L’Alleud in Belgium and the launch of building work on our Cimzia® plant in Bulle, Switzerland. These cutting edge facilities will help us to accelerate our innovation and improve our efficiency.
We aim that 2012 will be the last transition year for UCB, seeing the growth of new drugs and growth in Asia completely offset the fall in net sales from mature products and the impact of patents expiring. We expect 2012 to pave the way for a period of sustainable growth starting at the end of this year, without the loss of any major patents for a number of years to come. As I mentioned at the start of this speech, 2012 symbolises the results of the long-term work in pursuit of a clear and targeted strategy, the benefits of which we are starting to reap today and we expect for years to come. I would like to express my sincere thanks to our long-term shareholders, without whom this transformation at UCB could not have happened.
I cannot end this speech without paying special tribute to the Chairman of our Board, Karel Boone who, having reached the age limit, is leaving our Board of Directors. During his term in office, our company has seen a major transformation. Since he joined us in 2000, he has supported and encouraged the management team, with his unique perceptiveness, throughout this process which has made UCB what we are today. During his chairmanship, our corporate governance has continued to improve to the point that it serves as a model in Belgium and beyond. I have great pleasure in announcing the Board of Directors’ decision to appoint Karel Boone as Honorary Chairman. Even though we will miss Karel, I am delighted that Gerhard Mayr is succeeding him as Chairman of the Board of Directors. Gerhard has been a member of the Board since 2005, knows UCB inside out and brings with him exceptional experience, particularly of the pharmaceutical industry. Finally, I would like to thank the entire Board of Directors and all of the shareholders for their trust and support. Together, we are building a worldwide biopharmaceutical leader which focuses on people living with serious diseases, and our impact is growing by the day. I am so proud of this company.”
At the Ordinary Annual General Meeting 115 063 883 shares (62.75% of shares outstanding) were represented. For details please see UCB's website www.ucb.com/investors/calendar.asp.
The AGM approved for the fiscal year 2011 the payment of a gross dividend of EUR 1.00 per share (net dividend of EUR 0.75 per share) compared with EUR 0.98 per share for 2010 (net EUR 0.735). Ex-dividend day is April 27, the dividend will be payable on May 3, 2012 (coupon No. 14).
The AGM elected new member Charles-Antoine Janssen as Director, new member Harriet Edelman as independent Director, and re-elected Tom McKillop as independent Director. For curriculum vitae of the Board members, please see UCB's website http://www.ucb.com/investors/governance/board-directors
The Annual Report 2011 of UCB is published on the internet: http://www.ucb.com/investors/annual-reports/latest-annual-report
An interim report on the first three months has been published today, the financial results for the first half year 2011 will be announced on August 1, 2012 and an interim report for the first nine months of 2012 is due on October 29, 2012. Next year's AGM will be held on April 25, 2013 in Brussels (Belgium).
For further information
Antje Witte, Investor Relations, UCB
T +32.2.559.9414, firstname.lastname@example.org
Laurent Schots, Media Relations, UCB
T +32 2 559 92 64, email@example.com
France Nivelle, Global Communications, UCB
T +32.2.559.9178, firstname.lastname@example.org
UCB, Brussels, Belgium (www.ucb.com) is a global biopharmaceutical company focused on the discovery and development of innovative medicines and solutions to transform the lives of people living with severe diseases of the immune system or of the central nervous system. With more than 8 000 people in about 40 countries, the company generated revenue of EUR 3.2 billion in 2011. UCB is listed on Euronext Brussels (symbol: UCB).
Forward looking statements
This press release contains forward-looking statements based on current plans, estimates and beliefs of management. All statements, other than statements of historical fact, are statements that could be deemed forward-looking statements, including estimates of revenues, operating margins, capital expenditures, cash, other financial information, expected legal, political, regulatory or clinical results and other such estimates and results. By their nature, such forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions which could cause actual results to differ materially from those that may be implied by such forward-looking statements contained in this press release. Important factors that could result in such differences include: changes in general economic, business and competitive conditions, the inability to obtain necessary regulatory approvals or to obtain them on acceptable terms, costs associated with research and development, changes in the prospects for products in the pipeline or under development by UCB, effects of future judicial decisions or governmental investigations, product liability claims, challenges to patent protection for products or product candidates, changes in laws or regulations, exchange rate fluctuations, changes or uncertainties in tax laws or the administration of such laws and hiring and retention of its employees. UCB is providing this information as of the date of this press release and expressly disclaims any duty to update any information contained in this press release, either to confirm the actual results or to report a change in its expectations.
There is no guarantee that new product candidates in the pipeline will progress to product approval or that new indications for existing products will be developed and approved. Products or potential products which are the subject of partnerships, joint ventures or licensing collaborations may be subject to differences between the partners. Also, UCB or others could discover safety, side effects or manufacturing problems with its products after they are marketed.
Moreover, sales may be impacted by international and domestic trends toward managed care and health care cost containment and the reimbursement policies imposed by third-party payers as well as legislation affecting biopharmaceutical pricing and reimbursement.
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