CHEPLAPHARM Arzneimittel GmbH - Jefferies Group · CONFIDENTIAL Specialty pharma meets M&A competence CHEPLAPHARM Arzneimittel GmbH Jefferies London Healthcare Conference November

CONFIDENTIAL

Specialty pharma meets M&A competence

CHEPLAPHARM Arzneimittel GmbHJefferies London Healthcare ConferenceNovember 2019

CHEPLAPHARM Arzneimittel GmbH I Ziegelhof 24 I 17489 Greifswald I Germany I Tel.: +49 (0) 3834 8539-0 I Fax: +49 (0) 3834 8539-119 Internet: www.cheplapharm.com I Email: info[at]cheplapharm.com

2 CHEPLAPHARMOUR COMPANY ǀ Who we are

SUBSIDIARIES

• Paris (FR)

• Englewood, New Jersey (US)

FACTS 2019B

• > 300 employees

• 500 million EUR turnover*

• > 92 % share of exports

1998 ǀ Since 2003

• CHEPLAPHARM Arzneimittel GmbH was founded

• Part of the Braun Holding (BBG)

HEADQUARTERS

Greifswald (DE), close to the

Baltic Sea

*Including Net sales and sales/profit generated during the transitional phase of acquired products


3 CHEPLAPHARMAT A GLANCE

FINANCIAL ACHIEVEMENTS

80

122

228

292

47% 56%

59%

57%

2015A 2016A 2017A 2018A

mEUR Sales** EBITDA % EBITDA margin

COMPANY SNAPSHOT

*Compound Annual Growth Rate

CAGR* 54%

Since its foundation, CHEPLAPHARM has pursued a successful and sustainable growth strategy on a global level.

Family-owned company with > 25 years of expertise

Buy-And-Build strategy

M&A know-how and track record with > 90 products acquired

Branded specialty pharma / niche products in > 120 countries

Value creation via scalable platform and Life-Cycle-Management

Revenue growth < € 80m in 2015 to > € 290m in 2018

**Mix of Net sales and sales/profit generated during the transitional phase of

acquired products


4 CHEPLAPHARMAT A GLANCE

55%

2%

4%

4%

7%

8%

20%

Oceania

Africa

Northern America

Latin America and Caribbean

Germany

Asia

Europe ex Germany

CHEPLAPHARM is well diversified across products and geographic areas.

SALES BY GEOGRAPHY 2019B SALES BY THERAPEUTIC AREA 2019B

Sales = Mix of Net sales and sales/profit generated during the transitional phase of acquired

products


5 CHEPLAPHARMOUR COMMITMENT ǀ MISSION ǀ VISION

• CHEPLAPHARM is committed to provide products of high quality to our patients and to emphasize on sustainable product availability.

• A close and professional cooperation with our business partners is vital for us.

• We are dedicated to fully integrate acquired products and to duly continue their business.

It is our mission to provide high-quality, branded products on a global scale in order that our patients, business partners and employees benefit from the company’s success.

OUR

MISSION

OUR

VISIONIt is our vision to

• realize ǀ advance our >> growth strategy

• sustain ǀ strengthen our >> position as Global Player

• reinforce ǀ diversify our >> International Footprint


6 CHEPLAPHARMOUR BUSINESS MODEL ǀ Key drivers for the growth of our portfolio: BUY-AND-BUILD

Both types of product groups offer very attractive opportunities for CHEPLAPHARM’s successful “Buy-And-Build” strategy

Post-Patent Phase

Development Phase:High development risk

TimeCas

h

Development Phase Patent Phase

CHEPLAPHARM’s Business Model

Patent protection:• Big pharma • High price• High marketing costs• High volume risk

CHEPLAPHARM advantage:

• Limited or no competition• 10+ years out of patent• Stable sales• Low risk

2

1

Key driver: BUY

NICHE products

LEGACY products

ACQUIRED PRODUCTS’ CHARACTERISTICS

• Established branded (®) products with proven track record

• Niche pharmaceutical products – often with USP in the market

• Strategic products with existing opportunity for growth

and/or

• Opportunistic products with focus on an attractive ROI

1

2


7 CHEPLAPHARMOUR SUCCESS STORY

Our previous achievements form a solid foundation for future developments.

For the past 16 years, CHEPLAPHARM has completed more than 90 acquisitions with well-known pharmaceutical companies in over 120 countries.

The transaction value is over 1.3 billion EUR.

Companies such as:


8 CHEPLAPHARMCORPORATE DEVELOPMENT

Building the platform Acceleration of growth

Nu

mb

er

of

cou

ntr

ies

cove

red

Konakion®

Roche

Lariam®

Roche

Inhibace®/PlusRoche

Cymevene®

Roche

Visudyne®

Novartis

Streptosil®

Boehringer Italia

UCB PackageUCB

Sanofi Voltaire IISanofi

Reisegold®

Teva

Halbmond®

Teva

Rohypnol®

Roche

Vesanoid®

Roche

Distraneurin® / Heminevrin®

AstraZeneca

Baldrian Dispert®

Vemedia

Klosterfrau PackageKlosterfrau

Anexate®

Roche

Calcivit®

Hexal

Xenical®

Roche

Dilatrend®

RocheVesanoid® JapanRoche

Sotalex®

BMS

Questran®

BMS

Atacand®/PlusAstraZeneca

Fungizone®

BMS

Etopophos®

BMS

VePesid®

BMS

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Voltaire ISanofi

Dormicum®

Roche

Lexotan®

Roche

0

20

40

60

80

100

120

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

NICHE product with unique position

NICHE product with limited competition

LEGACY product with competition

Categorization of selected products (non-exhaustive):


9 CHEPLAPHARMBEING A GLOBAL PLAYER ǀ OUR INTERNATIONAL FOOTPRINT

> 90Acquisitions

> 1 bn €Deal value of past

acquisitions

> 900Acquired Marketing

Authorisations

> 120 Countries > 130Partners worldwide

30Yrs of experience withinthe management team

Status per 12/2018

OUR EXPERIENCE WITH ACQUISITIONS WORLDWIDE PRESENCE

• Direct business in more than 120 countries

• Grey coloured countries indirectly covered via our region-wide partners

• Vast and strong network of collaboration partners

• Secured supply and production network

Our achievements are a solid foundation for future developments


10 CHEPLAPHARMOUR FINANCING CONCEPT

With a TLB volume of EUR 980m outstanding just after one year, CHEPLAPHARM has also been very

successful at the Capital Markets. In addition, a sizeable hunting line (RCF) of EUR 310m is in place.

0

200

400

600

800

1,000

1,200

1,400

TLB I 07.18 TLB II 11.18 TLB III 06.19

TLB I - Tranche TLB - Tranche RCF commitment


11 CHEPLAPHARMOUR RATINGS

• “ CHEPLAPHARM runs a profitable and cash flow generative business model• …. good therapeutic and geographic diversity• …. successful track record and established relationships with leading global

pharma companies ”

• “With EBITDA margins projected at around 50% over the rating

horizon, the company ranks among the most profitable in Fitch’s low

non-investment grade portfolio….

• We project free cash flows (FCF) at or above EUR 100 million a

year….”

Fitch Ratings B+

B2

B

RATING-AGENCY ISSUER RATING

Moody‘s

Standard & Poor‘s

• “ CHEPLAPHARM will be able maintain its profitability metrics, supported by management's focus on lifecycle management activities

• The main strengths of the company is its established track record of careful productselection ….

• …. the company has been able to generate average EBITDA margins of about 55%”


12 CHEPLAPHARMKEY TAKEAWAYS

v

Provider of branded specialty pharma

Security of funding

M&A and business transfer track record

Further growth and development

OUR ACHIEVEMENTS ǀ Our basis for future developments

WHAT WE STRIVE FOR ǀ Strengthen and promote

Being a Global Player

Diversity in products and territory

Well-established global partner network

Expert in dealing with niche products

CONFIDENTIAL

Specialty pharma meets M&A competence

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CHEPLAPHARM Arzneimittel GmbH - Jefferies Group · CONFIDENTIAL Specialty pharma meets M&A competence CHEPLAPHARM Arzneimittel GmbH Jefferies London Healthcare Conference November