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Novo Nordisk A focused healthcare company

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    • 1. 1 Novo NordiskNovo Nordisk A focused healthcare companyA focused healthcare company Investor PresentationInvestor Presentation August 2002August 2002
    • 2. 2 Forward-looking statementsForward-looking statements This presentation contains forward-looking statements as the term is defined in the US PrivateThis presentation contains forward-looking statements as the term is defined in the US Private Securities Litigation Reform Act of 1995.Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks, uncertainties and inaccurate assumptions.Such forward-looking statements are subject to risks, uncertainties and inaccurate assumptions. This may cause actual results to differ materially from expectations. Factors that may affect futureThis may cause actual results to differ materially from expectations. Factors that may affect future results include interest rate and currency exchange rate fluctuations, delay or failure ofresults include interest rate and currency exchange rate fluctuations, delay or failure of development projects, production problems, unexpected contract breaches or terminations,development projects, production problems, unexpected contract breaches or terminations, government-mandated or market-driven price decreases for Novo Nordisk's products, introductiongovernment-mandated or market-driven price decreases for Novo Nordisk's products, introduction of competing products, Novo Nordisk's ability to successfully market both new and existingof competing products, Novo Nordisk's ability to successfully market both new and existing products, exposure to product liability and other lawsuits, changes in reimbursement rules andproducts, exposure to product liability and other lawsuits, changes in reimbursement rules and governmental laws and related interpretation thereof, unexpected growth in costs and expenses.governmental laws and related interpretation thereof, unexpected growth in costs and expenses. Risks and uncertainties are further described in reports filed by Novo Nordisk with the USRisks and uncertainties are further described in reports filed by Novo Nordisk with the US Securities and Exchange Commission (SEC) including the company's Form 20-F, which was filedSecurities and Exchange Commission (SEC) including the company's Form 20-F, which was filed on 26 April 2002. Novo Nordisk is under no duty to update any of the forward-looking statementson 26 April 2002. Novo Nordisk is under no duty to update any of the forward-looking statements after the date of this report or to conform such statements to actual results, unless required by law.after the date of this report or to conform such statements to actual results, unless required by law. Novo Nordisk has the copyright to the information contained in this presentation.Novo Nordisk has the copyright to the information contained in this presentation. © 2002 Novo Nordisk A/S.© 2002 Novo Nordisk A/S.
    • 3. 3 AgendaAgenda Update on the first half year of 2002Update on the first half year of 2002 Diabetes careDiabetes care Haemostasis managementHaemostasis management Financial resultsFinancial results Outlook 2002Outlook 2002
    • 4. 4 First half year 2002 in briefFirst half year 2002 in brief Sales up 6% from first half 2001Sales up 6% from first half 2001 Operating profit up 4% from first half 2001Operating profit up 4% from first half 2001 Second quarter sales up 9% and operating profit up 16%Second quarter sales up 9% and operating profit up 16% compared to Q2 2001compared to Q2 2001 Continued depreciation of USD, JPY and GBP versusContinued depreciation of USD, JPY and GBP versus DKKDKK Full-year outlook maintained at 5-10% operating profitFull-year outlook maintained at 5-10% operating profit growthgrowth
    • 5. 5 Sales by therapy first half year 2002Sales by therapy first half year 2002 Insulin sales growth inInsulin sales growth in International Operations (IO),International Operations (IO), Europe and North America.Europe and North America. NovoNormNovoNorm®® growth in Europegrowth in Europe and IOand IO North America and Europe bothNorth America and Europe both drive growthdrive growth Growth in Europe and the US, butGrowth in Europe and the US, but Japan hit by depreciation of JPY,Japan hit by depreciation of JPY, increased competition and lowincreased competition and low market growthmarket growth Negatively affected by parallelNegatively affected by parallel trade within Europe and bytrade within Europe and by lower market growthlower market growth Diabetes careDiabetes care +6%+6% HaemostasisHaemostasis managementmanagement +15%+15% (1%)(1%) hGHhGH HRTHRT (1%) Key observations:Key observations: Total turnover of DKK 12,035 mn: +6%Total turnover of DKK 12,035 mn: +6%
    • 6. 6 Key observations:Key observations: WeakQ1,butbothinsulinandWeakQ1,butbothinsulinand NovoSevenNovoSeven®® growthreturnedinQ2growthreturnedinQ2 NovoSevenNovoSeven®® ,insulinandhGH,insulinandhGH continuetogrow.continuetogrow. GrowthaffectedbydepreciationGrowthaffectedbydepreciation ofJPY,increasingcompetition,ofJPY,increasingcompetition, pricedecreasesandweakpricedecreasesandweak marketdevelopmentmarketdevelopment eakQ1,butstrongQ2eakQ1,butstrongQ2 rowthdrivenbyinsulinandrowthdrivenbyinsulinand ralanti-diabetesproductsralanti-diabetesproducts EuropeEurope +4%+4% InternationalInternational OperationsOperations +20%+20% NorthNorth AmericaAmerica +10%+10% JapanJapan & Oceania& Oceania (4%)(4%) Sales by region first half year 2002Sales by region first half year 2002 Total turnover of DKK 12,035 mn: +6%Total turnover of DKK 12,035 mn: +6%
    • 7. 7 HRTHRT Growth hormoneGrowth hormone therapytherapy IntellectualIntellectual propertyproperty Diabetes careDiabetes care HaemostasisHaemostasis managementmanagement PrimaryPrimary growthgrowth driversdrivers Novo Nordisk – future key driversNovo Nordisk – future key drivers Diabetes careDiabetes care SecondarySecondary valuevalue driversdrivers
    • 8. 8 Diabetes careDiabetes care SSales by quarterales by quarter Keyobservations:Keyobservations: InsulingrowthprimarilyrealisedinInsulingrowthprimarilyrealisedin InternationalOperationsandNorthInternationalOperationsandNorth America,followedbyEuropeAmerica,followedbyEurope Japan&OceaniawasimpactedJapan&Oceaniawasimpacted negativelybythedepreciationofnegativelybythedepreciationof JPYanddecreasedslightlyJPYanddecreasedslightly Theroll-outofNovoRapid®andTheroll-outofNovoRapid®and NovoMix®continues-analogueNovoMix®continues-analogue salesupby171%in1H2002salesupby171%in1H2002 NovoNorm®/Prandin®growthNovoNorm®/Prandin®growth drivenbyEuropeandInternationaldrivenbyEuropeandInternational OperationsOperations DKK millionDKK million 1999 2000 2001 20021999 2000 2001 2002 00 500500 1,0001,000 1,5001,500 2,0002,000 2,5002,500 3,0003,000 3,5003,500 4,0004,000 4,5004,500 5,0005,000 Q2Q2 Q3Q3 Q4Q4 Q1Q1 Q2Q2 Q3Q3 Q4Q4 Q1Q1 Q2Q2 Q3Q3 Q4Q4 Q1Q1 Q2Q2 + 9%+ 9%
    • 9. 9 Insulin – the ultimate diabetes therapyInsulin – the ultimate diabetes therapyββ-Cellfunction-Cellfunction Diet andDiet and exercise aloneexercise alone Oral therapyOral therapy (66%)(66%) InsulinInsulin therapytherapy (27%)(27%) Oral/insulinOral/insulin (approx 7%)(approx 7%) Time from diagnosisTime from diagnosis Type 2 - slope Type 1 - Immediate need for Insulin
    • 10. 10 The insulin business caseThe insulin business case VolumeVolume Number of people with diabetesNumber of people with diabetes expected to double by 2025expected to double by 2025 Less than half of those affectedLess than half of those affected are diagnosedare diagnosed Ageing population and a moveAgeing population and a move towards affluent lifestyle leadingtowards affluent lifestyle leading to increased prevalenceto increased prevalence A drive towards intensifiedA drive towards intensified therapytherapy 5% annual growth5% annual growth 5% annual growth5% annual growth ++ Product upgradesProduct upgrades Conversion from human insulinConversion from human insulin to insulin analoguesto insulin analogues Conversion from vials andConversion from vials and syringes to delivery systemssyringes to delivery systems
    • 11. 11 Insulin market overviewInsulin market overview (MATQ1 2002 Volumes)(MATQ1 2002 Volumes) Notes:Notes: Industrialised world only. Based on IMS data. Monthly data used for Canada.Industrialised world only. Based on IMS data. Monthly data used for Canada. Wal*Mart figures not included. Growth in Europe effected by conversion ofWal*Mart figures not included. Growth in Europe effected by conversion of formulation.formulation. Novo NordiskNovo Nordisk market sharemarket share 2266%% 5588%% 7878%% 60%60% 4466%%WorldWorld Rest of IMS worldRest of IMS world JapanJapan EuropeEurope USAUSA Market growthMarket growth 4343%% 4848%% 4%4% 66%% % market size% market size 100%100% 3.6%3.6% 7.9%7.9% 7.0%7.0% 7.8%7.8% 6.1%6.1%
    • 12. 12 Upgrading the insulin marketUpgrading the insulin market InsulinanalogueInsulinanaloguemaninsulinmaninsulin USD1.5USD1.5 >USD2.0>USD2.0 USD1.0USD1.0 Estimated averageEstimated average treatment cost per daytreatment cost per day VialsVials PensPens USD1.5USD1.5
    • 13. 13 Analogue case still intactAnalogue case still intact Strong analogue penetrationStrong analogue penetration continuescontinues NovoRapid®/NovoLogNovoRapid®/NovoLog®® continues to increase share in thecontinues to increase share in the short-acting segmentshort-acting segment NovoMixNovoMix®® 30 being rolled out in30 being rolled out in EuropeEurope NovoMixNovoMix®® 30 to be launched in30 to be launched in the US later this yearthe US later this year Analogues backed by newAnalogues backed by new devices: InDuodevices: InDuo®®, FlexPen, FlexPen®,®, InnoLet®InnoLet® and NovoPenand NovoPen®® JrJr AnaloguesAnalogues share of insulinshare of insulin sales worldwidesales worldwide Novo Nordisk'sNovo Nordisk's share of short-share of short- acting analogueacting analogue market worldwidemarket worldwide Notes:Notes: Volumes in industrialised world IMSVolumes in industrialised world IMS 1996 1997 1998 1999 2000 2001 20021996 1997 1998 1999 2000 2001 2002 17%17% 20%20%
    • 14. 14 European analogue conversion - NovoRapidEuropean analogue conversion - NovoRapid®® Short-acting segment in EuropeShort-acting segment in Europe Q2 1996Q2 1996 Q1 2002Q1 2002 Short-acting human insulinShort-acting human insulin 37%37% Short-actingShort-acting insulin analoguesinsulin analogues Short-acting human insulinShort-acting human insulin June 2000June 2000 NovoRapidNovoRapid®® marketmarket share 12.3%*share 12.3%* Humalog marketHumalog market share 26.5%*share 26.5%* * IMS ‘brand’ volume market share of short-acting insulin.* IMS ‘brand’ volume market share of short-acting insulin. Preliminary information for Apr/May 2002Preliminary information for Apr/May 2002 Share of short-acting segmentShare of short-acting segment May 2002May 2002 37%37% * IMS ‘brand’ volume market share of short-acting insulin.* IMS ‘brand’ volume market share of short-acting insulin.
    • 15. 15 US analogue conversion - NovoLogUS analogue conversion - NovoLog®® Key observations:Key observations: Market share increaseMarket share increase backed by continuedbacked by continued penetration of NovoLog®penetration of NovoLog® NovoLog® launchedNovoLog® launched September 2001 - pumpSeptember 2001 - pump indication added inindication added in December 2001December 2001 Launch of NovoLogLaunch of NovoLog®® Mix toMix to follow this yearfollow this year0%0% 5%5% 10%10% 15%15% 20%20% 25%25% 30%30% Q11999Q11999 Q21999Q21999 Q31999Q31999 Q41999Q41999 Q12000Q12000 Q22000Q22000 Q32000Q32000 Q42000Q42000 Q12001Q12001 Q22001Q22001 Q32001Q32001 Q42001Q42001 Q12002Q12002 Novo Nordisk total market share (vol) in the USNovo Nordisk total market share (vol) in the US NovoLogNovoLog® share® share Novo Nordisk share of theNovo Nordisk share of the US short-acting marketUS short-acting market
    • 16. 16 NovoMixNovoMix®® 30 – simple control30 – simple control Blood glucose controlBlood glucose control ConvenienceConvenience Basal-Basal- BolusBolus OADsOADs Human MixHuman Mix NPHNPH NovoMix® 30NovoMix® 30 Key observations:Key observations: NovoMixNovoMix®®30 covers the30 covers the basal insulin need whilebasal insulin need while adding the benefit ofadding the benefit of targeting post-prandialtargeting post-prandial glucose controlglucose control NovoMixNovoMix®®30 comes in30 comes in FlexPenFlexPen®® - the preferred- the preferred disposable devicedisposable device Full premix analogueFull premix analogue programme scheduledprogramme scheduled
    • 17. 17 Diabetes pipelineDiabetes pipeline NN2211NN2211 (GLP-1 analogue)(GLP-1 analogue) NN344NN344 (Basal analogue)(Basal analogue) NN1998NN1998 (AERx(AERx®iDMS®iDMS)) NN304NN304 (Insulin detemir)(Insulin detemir) NN414NN414 (Beta cell rest)(Beta cell rest) Phase 1Phase 1 Phase 2Phase 2 Phase 3Phase 3 NN2344NN2344 (Insulin sensitiser)(Insulin sensitiser) Note: Clinical development of ragaglitazar (NN622) was suspended in July 2002.Note: Clinical development of ragaglitazar (NN622) was suspended in July 2002. NovoMixNovoMix®® 5050 (Premixed analogue)(Premixed analogue)
    • 18. 18 Insulin detemir to be filed at the turn of the yearInsulin detemir to be filed at the turn of the year Detemir compared with NPH :Detemir compared with NPH : Has significantly less within-Has significantly less within- subject variabilitysubject variability Results in a slight decrease inResults in a slight decrease in body weightbody weight Has significantly less nocturnalHas significantly less nocturnal hypoglycaemic eventshypoglycaemic events Produces a smoother nocturnalProduces a smoother nocturnal glucose profileglucose profile The duration of action of detemirThe duration of action of detemir is 20 hours at a therapeuticallyis 20 hours at a therapeutically relevant dose of 0.4 U/kg.relevant dose of 0.4 U/kg. CCmaxmax CV (%)CV (%) AUCAUC0-24h,0-24h, CV insulinCV insulin concconc.. (%)(%) Insulin detemirInsulin detemir 1313 2020 NPH insulinNPH insulin 2626 3737 ReductionReduction 51%51% 45%45% p-p-valuevalue <0.001<0.001 0.0010.001 Significantly lower within-subject variabilitySignificantly lower within-subject variability Within-subject variability ofWithin-subject variability of pharmacokineticspharmacokinetics
    • 19. 19 AERxAERx®® s.c.s.c. HbAHbA1c1c(%)(%) HbAHbA1c1c mean profiles, ITT population,mean profiles, ITT population, meanmean ±± 2 SEM2 SEM Our inhaled insulin – ready to enter Phase 3Our inhaled insulin – ready to enter Phase 3 77 7.57.5 88 8.58.5 99 ADA2002ADA2002 -0.74%-0.74% -0.74%-0.74% HbAHbA1c1c(%) reduction(%) reduction Key observations:Key observations: Deep lung deposition of aerosolsDeep lung deposition of aerosols ““Breath Check”, one unitBreath Check”, one unit increments, highly reproducibleincrements, highly reproducible deliverydelivery Rapid-acting profile, one unitRapid-acting profile, one unit increments and patient-friendlyincrements and patient-friendly featuresfeatures 1 oral presentation and 4 posters1 oral presentation and 4 posters at ADAat ADA 3 posters accepted for EASD3 posters accepted for EASD Phase 3 to start later this yearPhase 3 to start later this year
    • 20. 20 Novo Nordisk – future key driversNovo Nordisk – future key drivers Diabetes careDiabetes care HaemostasisHaemostasis managementmanagement PrimaryPrimary growthgrowth driversdrivers SecondarySecondary valuevalue driversdrivers HRTHRT IntellectualIntellectual propertyproperty Growth hormoneGrowth hormone therapytherapy
    • 21. 21 Haemostasis management (NovoSevenHaemostasis management (NovoSeven®® )) Keyobservations:Keyobservations: GrowthinNorthAmericaGrowthinNorthAmerica continuescontinues SolidQ2growthinEurope,SolidQ2growthinEurope, partlyduetolargesinglepartlyduetolargesingle ordersinseveralEuropeanordersinseveralEuropean countriescountries PanEuropeanHaematologyPanEuropeanHaematology BusinessUnitnowBusinessUnitnow establishedestablished 1999 2000 2001 20021999 2000 2001 2002 00 100100 200200 300300 400400 500500 600600 700700 800800 900900 Q2Q2 Q3Q3 Q4Q4 Q1Q1 Q2Q2 Q3Q3 Q4Q4 Q1Q1 Q2Q2 Q3Q3 Q4Q4 Q1Q1 Q2Q2 DKK millionDKK million SSales by quarterales by quarter + 20%+ 20%
    • 22. 22 NovoSeven® – current indicationNovoSeven® – current indication CreateCreate confidenceconfidence First-lineFirst-line position inposition in haemophiliahaemophilia AcquiredAcquired haemophiliahaemophilia Estimated close toEstimated close to 1,000 patients in1,000 patients in industrialised worldindustrialised world 75-100% efficacy in75-100% efficacy in acquired haemophiliaacquired haemophilia Awareness creationAwareness creation and outcome dataand outcome data ~~300,000 doses with300,000 doses with excellent safety dataexcellent safety data Effective haemostasisEffective haemostasis established inestablished in orthopaedic surgeryorthopaedic surgery Early treatment providesEarly treatment provides faster recoveryfaster recovery 3,500 pts in industrialised3,500 pts in industrialised worldworld 93% efficacy in bleeding93% efficacy in bleeding episodes treated at homeepisodes treated at home
    • 23. 23 Unmet needs in haemostasis managementUnmet needs in haemostasis management Bleeding a is seriousBleeding a is serious clinical challengeclinical challenge Common cause of deathCommon cause of death Morbidity associated withMorbidity associated with blood transfusions is ofblood transfusions is of great concerngreat concern Alternatives are scarceAlternatives are scarce Blood products areBlood products are becoming more scarcebecoming more scarce and expensiveand expensive Surveys indicate largeSurveys indicate large unmet clinical needunmet clinical need 10 million severe bleeding10 million severe bleeding conditions annuallyconditions annually Severe bleeding conditionsSevere bleeding conditions growing in relation togrowing in relation to medical proceduresmedical procedures Growing industry attentionGrowing industry attention EPO manufacturersEPO manufacturers Oxygen carriersOxygen carriers
    • 24. 24 HaemophiliaHaemophilia & congenital& congenital bleeding disordersbleeding disorders NovoSeven® expansion projectNovoSeven® expansion project Haemophilia withHaemophilia with inhibitorsinhibitors Acquired haemophiliaAcquired haemophilia FVII and FXI deficiencyFVII and FXI deficiency GlanzmannGlanzmann Bernard-SoulierBernard-Soulier Other coagulationOther coagulation factor defectsfactor defects Surgery & Intensive careSurgery & Intensive care *) = Patients with chronic liver disease*) = Patients with chronic liver disease Upper gastro-Upper gastro- intestinal bleeding *)intestinal bleeding *) Orthotopic liverOrthotopic liver transplantation *)transplantation *) Liver resection *)Liver resection *) Reversal of anti-Reversal of anti- coagulation therapycoagulation therapy Stem cellStem cell transplantationtransplantation Intra-cerebralIntra-cerebral bleedingsbleedings Liver resectionLiver resection TraumaTrauma
    • 25. 25 FFinancial resultsinancial results Net turnoverNet turnover 12,03412,034 11,35111,351 66 6,5536,553 6,0016,001 99 Operating profitOperating profit 2,8562,856 2,7402,740 44 1,6061,606 1,3821,382 1616 Net financialsNet financials 9999 241241 (59)(59) 8282 44 -- Profit before taxProfit before tax 2,9552,955 2,9812,981 (1)(1) 1,6881,688 1,3861,386 2222 Net profitNet profit 1,9251,925 1,9081,908 11 1,1011,101 887887 2424 EPS (DKK)*EPS (DKK)* 5.515.51 5.485.48 11 3.153.15 2.552.55 2424 ** Earnings per share on a diluted basis, ie 349.6 million shares in H1 2002 and 349.4Earnings per share on a diluted basis, ie 349.6 million shares in H1 2002 and 349.4 million Q2 2002.million Q2 2002. DKK millionDKK million First half yearFirst half year Second quarterSecond quarter 20022002 20012001 % change% change 20022002 20012001 % change% change
    • 26. 26 Currency exposureCurrency exposure 6 7 8 9 2001 avg = 8.32 2001 avg = 6.85 2000 2001 2002 Effect of 5%Effect of 5% appreciation onappreciation on operating profit*operating profit* (DKK million)(DKK million) JPYJPY +140+140 USDUSD +110+110 GBPGBP +50+50 ** ie before hedging activities.ie before hedging activities. 1H 2002 avg = 6.39 1H 2002 avg = 8.29 Aug 5 Apr 30 DKK per USD 7.55 8.25 (8.5%) DKK per 100 JPY 6.34 6.43 (1.4%)
    • 27. 27 Outlook for 2002Outlook for 2002 Expected sales growth between 6-8%Expected sales growth between 6-8% Growth in operating profit of 5-10% is reaffirmedGrowth in operating profit of 5-10% is reaffirmed Net financial income now expected to be approximatelyNet financial income now expected to be approximately DKK 250 millionDKK 250 million Tax rate still expected at the level of 35%Tax rate still expected at the level of 35% Investments still expected at DKK 4.5Investments still expected at DKK 4.5 billionbillion Share repurchasing programme of DKK 2 billion initiatedShare repurchasing programme of DKK 2 billion initiated Above outlook is based on the assumption thatAbove outlook is based on the assumption that exchange and interest rates remain at the current levelexchange and interest rates remain at the current level (6 August 2002).(6 August 2002).
    • 28. 28 Investor InformationInvestor Information Investor Relations contacts:Investor Relations contacts: Novo Nordisk A/SNovo Nordisk A/S Investor RelationsInvestor Relations Novo AlléNovo Allé DK-2880 BagsværdDK-2880 Bagsværd DenmarkDenmark Fax (+45) 4444 2314Fax (+45) 4444 2314 Peter HaahrPeter Haahr Phone (+45) 4442 1207Phone (+45) 4442 1207 E-mail: pehr@novonordisk.comE-mail: pehr@novonordisk.com Palle Holm OlesenPalle Holm Olesen Phone (+45) 4442 6175Phone (+45) 4442 6175 E-mail: phoo@novonordisk.comE-mail: phoo@novonordisk.com Rasmus JorgensenRasmus Jorgensen PhonePhone (+1) 212 878 9607(+1) 212 878 9607 E-mail: rrhj@novonordisk.comE-mail: rrhj@novonordisk.com Share informationShare information Novo Nordisk’sNovo Nordisk’s B shares are listedB shares are listed on the stock exchanges inon the stock exchanges in Copenhagen and London. ItsCopenhagen and London. Its ADRs are listed on the New YorkADRs are listed on the New York Stock Exchange under the symbolStock Exchange under the symbol "NVO". For further company"NVO". For further company information, visit Novo Nordisk oninformation, visit Novo Nordisk on the Internet atthe Internet at http://www.novonordisk.comhttp://www.novonordisk.com