Portfolio Optimization for
Claricure Pharmaceuticals
RL
TC
RLTC Solutions
04/17/2015
1
RL
TC
Portfolio Redistribution
Patent Challenges
Introduction
Claricure is losing patent exclusivity on Accitra, a $9 billion diabetes drug
Our Goal
Maintain revenue levels through Accitra patent cliff by optimizing
remaining portfolio with $3 billion
Our Strategy
1.
2.
3.
Sell oncology drug to invest more money in long-term portfolio
Support Accitra through the cliff to minimize loss of market share
Focus funds into markets with potential blockbusters
2
RL
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A Plan for Success
DTC Advertising
Introduction
Sell Oncology Drug
($2.4B)
Defend Accitra
Through Patent
Cliff ($1.5 B)
Provider Sales Calls
Invest in Emerging
Markets
Portfolio
Optimization
Funds ($3 B)
Strengthen
Distribution
Relationships
Develop
Remaining
Portfolio ($3.9 B)
Invest Heavily in Drugs
with Blockbuster
Potential
Promote the Global
Brand
3
RL
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Portfolio Projections
Our
Optimized
Strategy
Portfolio
Accitra
Funding
Funding
Priority
Priority
Introduction
20
18
16
$13B
14
12
10
8
6
4
2
0
2014
2015
Accitra
2016
Oncology
Cardiology
2017
Anticoagulant
Antibacterial
2018
HIV
2019
Contraceptive
4
RL
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Surviving the Patent Cliff
Accitra Strategies
Provider marketing
DTC advertising campaign
Co-pay coupons
Distribution network
•
•
•
•
Diabetes
40
Percent of Sales
35
2012
30
2017
25
20
15
10
5
0
US
Europe
Asia
Other
$1.5B
Model Blockbusters
Lipitor
• Market leader: 33%
• Maintained 51% of revenue
first year off patent
• $900 million on DTC
marketing before patent cliff
Diovan
• Maintained 60% of revenue
first year after cliff
• Compete with generics in
Asia and Latin America
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$0.9B
Beating the Curve
12
7
Current market
estimates:
•
•
-8.1% Antihyperlipidemics
-6.0% Antihypertensives
5
8
Billions
Cardiology
2012: Global
cardiovascular market
valued at $110 billion
6
10
4
6
3
Diovan
Lipitor
Micardis
Crestor
4
2
2
1
0
2010
2011
2012
2013
Large decreases in market driven by blockbuster drugs
coming off patent
• -1.1% for comparable drugs
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Anticoagulation
Stealing Market Share
Drug
FDA
2013 Sales
($M)
2014
Sales ($M)
CAGR
Warfarin+
1954
$102
$96
-6%
Xarelto
2011
$864
$1522
76%
Eliquis
2012
$146
$774
500%
$1.2B
• Largest market growth of any therapeutic market
• $24B by 2019
• Antidote for new mechanism  Market shift from
standard of care
• 10% Market Share by 2019  $2.4B
• Strong Launch
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A High Growth Market
35
30
25
20
15
10
5
0
Year
HIV
% Market Share in Initial Three
Full Years
% Market Share
Revenue ($B)
HIV Market Size
$1.2B
20
Year 1
15
Year 2
10
Year 3
5
0
Atripla
Truvada
2014 HIV market = $23B, growing 6-7% annually
• Optimize design of final trials (CRO)
• Developed detailed product launch
• Focus on first sixth months
• In three years, capture 17% market share
• Risk Adjusted to $2.6B in 2019
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A Difficult Market
Opportunities
• $40B market
• Aging Population
• Few companies exploring
Antibacterial
Cubicin Revenue/Expenses
600
Expenses
500
Revenue
400
$Millions
Challenges
• Slow market growth
• Saturated market
$0.6B
300
200
100
Plan
• Optimize product launch
0
• Priority markets, providers
• Capture 1.25% market share in
four years
• $500M by 2019
2004
2005
2006
2007
2008
2009
Year
9
RL
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Monitoring Success
Market Share
Sales
• Overall measure
of drugs’
performance
• Specific to
therapeutic area
• Evaluated
quarterly
• Biweekly reports
• Enables more
targeted efforts
• Number of
prescriptions vs.
competitors
Brand
Awareness
• Survey providers
to understand
prescribing
behavior
• Survey patients
Conclusion
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RL
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Conclusion
Challenges to Success
Oncology drug is a
blockbuster
$2.4B Investment will result in larger
ROI for remaining portfolio compared to
off-patent oncology drug
Anticoagulant
antidote does not
get FDA approval
Adjust marketing strategy to
physicians to emphasize overall
benefits
HIV fails phase III
clinical trial
Our numbers are risk adjusted to
account for this
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Return on Investment
2.6
14
$1.2B
$1.5B
$0.6B
$1.2B
$0.9B
Net Change ($B)
13
13.0 -2.9
12
0.5
2.4
11
10
0.1 14.2
-0.5
-1.0
9
8
7
Conclusion
Diabetes (Accitra)
Cardiology
Anticoagulant
Antibacterial
HIV
6
12
Questions?
Thank you for your time.
RL
TC
13
APPENDIX
14
Product
2014
2015
2016
2017
2018
2019
Diabetes
9.1
9.8
10.6
11.5
12.4
6.2
Oncology
1
2.4*
X
X
X
X
Cardiology
2.9
2.8
2.7
2.6
2.5
2.4
Anticoagulant
X
X
X
0.6
1.3
2.4
Antibacterial
X
X
0.2
0.3
0.4
0.5
HIV
X
X
X
0.7
1.5
2.6
Contraceptive
X
X
0.1
0.1
0.1
0.1
Total Annual
Revenue
13.0
15.0
13.6
15.8
18.2
14.2
2015
2016
Q1 2016 –
Antibacterial
drug enters
market
Q2 2016 –
Contraceptive
drug enters
market
2017
Q4 2016 –
Anticoagulant
drug enters
market
Q1 2017 –HIV
drug enters
market (Pending
CT results)
2018
2019
Q2 2018 –
Oncological
drug patent
expiration
2020
Q2 2020 –
Cardiology
drug patent
expiration
Q1 2019 –
Accitra patent
expiration
15
Diabetes Calculations
Year
2012
2013
2014
2015
2016
2017
2018
2019
2020
Total Market ($B)
35.6
38.8
42.3
46.1
50.3
54.8
59.7
65.1
70.9
Assuming market grows at a
9% CAGR
Market Leaders
2013 Annual
Sales
2012 Annual
Sales
Growth ($)
Lantus
7.4 Billion
6.37 Billion
970 Million
15%
18%
Insulin Analog, modified to be released in a controlled
manner over time
Januvia*
4.0 Billion
4.09 Billion
(-82 Million)
(-2%)
11.5
Small molecule anti-hyperglycemic
NovoRapid
2.91 Billion
2.71 Billion
199 Million
7%
8%
Insulin Analog, modified to be faster-acting
Humalog
2.61 Billion
2.4 Billion
215 Million
9%
7%
Insulin Analog (first to market, off patent since
May2013)
Victoza
2.01 Billion
1.64 Billion
369 Million
23%
5%
Injectable peptide mimetic- stimulates insulin secretion
Levemir
1.99 Billion
1.63 Billion
304 Million
18%
5%
Insulin Analog
Sales Data from fiercepharma.com and globaldata via PMLive.com
Market Estimates: Thomson Reuters
IMS Health: Launch Excellence in the Diabetes Market
Growth 2012 Market
(%)
Share
Product Type
Idealized Accitra
Accitra 2018
Januvia 2018
Victoza 2018
Total
After patent loss
Baseline
12.4
5.2
2.4
20.0
8.0
50% Stolen
16.2
2.6
1.2
16.2
6.5
Baseline assumptions: All drugs
maintain 2014 market share
Alternate: Accitra takes 50%
market share from other market
leaders, implements plan to
minimize revenue loss after
patent cliff.
HIV Calculations
HIV market = $23B (2014), 27.4B (2017), 29.2B (2018), 31.1B (2019)
Assumes 6.5%growth
Atripla first three years: 9.7, 12.9, 17.4% market share
Truvada: 7.7, 14.3, 17.1% market share
Claricure: 6, 12, and 17% (2019) = $5.3B
Spending $400M extra/year
Phase III Risk Adjustment = $5.3B*50% = $2.6B
1
Antibacterial Calculations
Ab market = $40B (2014)
Cubicin first three years (2004-2006): $59M, $95M, $200M
Now Blockbuster: $1.0B in 2014, 2.5% Market share
Cubist (launched Cubicin): initially a smaller company, budget, sales
team, operations
Year three spent $140M, made $200M
We can do that in the first year, and continue growth with this solid drug
1
Building on Success
Promote the global brand through
“access” programs in developing
countries
Targeting emerging markets (Asia)
Focus pipeline to targeted
therapeutic areas
Continue to strengthen distribution
network through relationships with
wholesalers
20
Cardiovascular Calculations
Segmented Cardiovascular Drug Market
for Top 10 Drugs
Patent Exp.
Growth 2012-2013
% Growth
Jul-16
Crestor
(649,000,000.00)
-8.6
Sep-12
Diovan
(917,000,000.00)
-20.8
Nov-11
Lipitor
(1,783,000,000.00)
-37.0
Dec-16
Zetia
312,000,000.00
12.2
Oct-16
Benicar
(167,000,000.00)
-5.1
Jan-14
Mar-12
Micardis
Avapro
85,000,000.00
(402,325,000.00)
2.6
-20.9
Apr-17
Vytorin
(104,000,000.00)
-6.0
Jun-12
Nov-15
Blopress
Tracleer
(77,000,000.00)
(30,000,000.00)
-3.6
-1.9
Average On Patent:
Total Average Growth:
-1.1
-20.5
21
Cardiovascular Figures
Lipitor Worldwide Annual Revenue
T o p 1 0 C a r d i o v a s c u la r D r u g s i n 2 0 1 2
Ze t ia
D ru g C
M ic a r d is
B e n ic a r
D io v a n
L ip it o r
1
.0

8
6
.0

1
0
0
9
9
9
1
.0

4
2
.0

1
0
0
9
C re s to r
0
D ru g
B lo p r e s s
W o r ld w id e R e v e n u e ( $ B illio n s )
Annual Revenue ($ Billion)
V yt o r in
Av a p r o
14
200.0
12
150.0
10
100.0
8
% Growth
T r a c le e r
50.0
6
0.0
4
2
-50.0
0
-100.0
Year
22