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Telephone conference, February 20, 2014 at 10:30 a.m. (CET)Dial-in number: +46 8-506 26 900, enter code: 409017Peter Wolpert, CEO and founder
Year end report 2013A DIFFERENT KIND OF PHARMA COMPANY
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Disclaimer
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Statements included herein that are not historical facts are forward-looking statements. Such forward-looking statements involve a number of risks and uncertainties and are subject to change at any time. In the event such risks or uncertainties materialize, Moberg Pharma’s results could be materially affected. The risks and uncertainties include, but are not limited to, risks associated with the inherent uncertainty of pharmaceutical research and product development, manufacturing and commercialization, the impact of competitive products, patents, legal challenges, government regulation and approval, Moberg Pharma’s ability to secure new products for commercialization and/or development and other risks and uncertainties detailed from time to time in Moberg Pharma AB’s interim or annual reports, prospectuses or press releases.
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A different kind of pharma company
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2010 2011 2012 2013
Rapid growth with Kerasal Nail™/Nalox™ as key growth driver
Products based on innovative drug delivery of proven molecules
Direct sales in the U.S.
Network of distributors/partners in RoW
Growth strategy – Organic and M&A
NOTE: In comparison with 2012, Moberg Pharma has own direct sales in the U.S. from 2013. Revenues in 2013 consist mainly of product revenues while revenues in 2012 include substantial milestone payments.
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15 consecutive quarters of sales growthProduct Sales TTM, MSEK
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0
25
50
75
100
125
150
175
Q12010
Q22010
Q32010
Q42010
Q12011
Q22011
Q32011
Q42011
Q12012
Q22012
Q32012
Q42012
Q12013
Q22013
Q32013
Q42013
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Milestone in key development project– MOB-015 – interim results after 6 months show
40% mycological cure – a world leading outcome
Acquisition of OTC products in the U.S.– Three brands acquired from Bayer Healthcare at
1.6x Net Sales– Contributes directly to cash-flow and earnings
Continued strong growth in the U.S– Kerasal Nail™ reaches milestone in the U.S. – 20%
market share. Distribution expanded to major retailers – Safeway and Target added
– Kerasal NeuroCream off to a good start
Increased distribution in key RoW markets– New agreements for South East Asia (Menarini)
and MENA (Leosons)
Fourth quarter highlights
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Sales increase owing to successful acquisition and strong organic growth
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61%GROWTH IN
PRODUCT SALES
Q4 2012 Q4 2013
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Net Sales, MSEK
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Product SalesMilestones
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Continued growth and positive EBITDA in Q4
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Cash position December 31 27.1
Financial goal remain unchangedAchieve a sustainable EBITDA margin of 25% within the coming three-year period under continued healthy growth
Oct-Dec Oct-Dec Jan-Dec Jan-Dec(MSEK) 2013 2012 2013 2012
Revenues- Product sales- Milestones
36.832.04.8
30.219.910.3
157.4152.6
4.8
112.582.729.8
EBITDA 2.4 -0.2 -7.9 13.3- Operating profit 0.8 -0.7 -14.1 12.6- Earnings after Tax -0.4 -6.3 -11.4 35.8- Earnings per Share (SEK) -0.04 -0.63 -1.01 3.85
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Majority of revenue from proprietary sales
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Sales via distributors
40%
Direct OTC Sales 60%
JointFlex21%
Nalox/ Kerasal Nail
62%
Kerasal17%
RoW12%
Europe 28%America
61%
Channels Products Geography
Distribution of revenue, Jan - Dec 2013
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Strong growth in U.S. and RoW offsetting the decline in Europe
8 NOTE: 2012 revenues include milestone payments of 30 MSEK.
Revenue by geographical market Oct‐Dec Oct‐Dec Full‐year Full‐year (KSEK) 2013 2012 2013 2012
Europe 8,094 17,395 43,494 84,102 America 20,913 7,782 94,250 20,275 Rest of the world 7,826 5,021 19,645 8,092
TOTAL 36,833 30,198 157,389 112,469
Revenue by product category Oct‐Dec Oct‐Dec Full‐year Full‐year (KSEK) 2013 2012 2013 2012
Nalox/Kerasal Nail™, sales of products 15,319 15,828 93,152 78,501
Nalox/Kerasal Nail™, milestone payments 4,813 10,250 4,813 29,750
Kerasal® 6,611 1,466 26,263 1,466
JointFlex® 9,655 2,654 32,726 2,654
Other products 435 ‐ 435 98
TOTAL 36,833 30,198 157,389 112,469
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Key ratios
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Oct‐Dec Oct‐Dec Full‐year Full‐year(KSEK) 2013 2012 2013 2012
Revenue 36,833 30,198 157,389 112,469Gross margin % 74% 76% 75% 78%Gross margin on product sales %, excluding acquisition‐related costs and items affecting comparability
75% 71% 77% 72%
EBITDA excluding acquisition‐related costs 2,359 7,830 ‐4,879 21,388EBITDA % excluding acquisition‐related costs 6% 26% neg 19%EBITDA 2,359 ‐251 ‐7,950 13,307Operating profit/loss (EBIT) 826 ‐666 ‐14,055 21,388Debt/equity ratio 15% 22% 15% 22%Equity/assets ratio 74% 63% 74% 63%Earnings per share, SEK ‐0.04 ‐0.63 ‐1.01 3.68Operating cash flow per share, SEK 0.07 ‐0.27 ‐0.28 0.97Equity per share, SEK 16.94 16.48 16.94 16.48Share price on the closing date, SEK 31.60 37.30 31.60 37.30Market capitalization on the closing date, MSEK 376 403 376 403
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Positive operating cash-flow during Q4
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Oct‐Dec Oct‐Dec Full‐year Full‐year (MSEK) 2013 2012 2013 2012
Cash flow before changes in working capital 2.5 0.4 ‐8.2 16
Change in working capital ‐1.7 ‐3.1 5.1 ‐6.5
CASH FLOW FROM OPERATING ACTIVITIES 0.8 ‐2.7 ‐3.2 9.5
CASH FLOW FROM INVESTING ACTIVITIES ‐30.3 ‐97.3 ‐47.2 ‐97.7
CASH FLOW FROM FINANCING ACTIVITIES ‐3.3 67.7 24 67.6 Change in cash and cash equivalents ‐32.8 ‐32.2 ‐26.3 ‐20.7 Cash and cash equivalents at the start of the period 59.9 85.6 53.4 74.1 Exchange‐rate difference in cash and cash equivalents ‐ ‐ ‐ ‐ Cash and cash equivalents at the end of the period 27 53.4 27.1 53.4
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Successful marketing and expanded distribution drive sales of Kerasal Nail™
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Q4 2012 Q4 2013
Kerasal Nail™ – U.S. market share
Best selling product in its category in the U.S. Available at >30 000 points of sale,
Safeway and Target latest additions
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Three brands acquired from Bayer HealthCare in Q4
Domeboro®
First launched in 1942 – household name for relieving minor skin irritations due to e.g. poison ivy
Broad distribution
Vanquish®
Pain reliever containing aspirin, paracetamol and caffeine
Broad distribution
Fergon®
Iron supplement – mainly sold at Rite-Aid
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Contributes directly to cash-flow and earnings
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Rest of the world contributed to growth, Europe still low
Nalox™/Kerasal Nail™
Revenue increased 56 percent in Q4 for the RoW-region
Distribution agreements expanded to MENA (Leosons) and South East Asia (Menarini)
Kerasal Nail™ approved in UAE
Launch in Canada started well
Deliveries to distributors in Europe still low due to high inventory levels, but underlying sales to pharmacies and consumers increased Jan-Dec 2013.
Note: Not an all inclusive list.
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Organic growth
Current products growing, line extensions - Kerasal NeuroCream™ launch started
New markets through distributors 8 patent families enable additional products
- MOB-015
>100BD OPPORTUNITIES EVALUATED IN 2013
2ACQUISITIONS LAST 13 MONTHS
Acquisitions/inlicensing
Brands - Focus on US OTC market Projects and technologies
Completed OTC Acquisitions Alterna LLC, Nov 2012, 20 m$ (1.8x Sales) Bayer brands, Dec 2013, 4.8 m$ (1.6x Sales)
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MYCOLOGICAL CURE AFTER 6 MONTHS
MOB-015, n=25, Final data H214
MOB-015 – Superior results after 6 months
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MOB015 efficacy results are superior to topical drugs on the market and on par with oral terbinafine therapy – but without the safety issues of oral therapy
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Mycological cure
Active Product Company Form at 6 months at 12 months
Terbinafine MOB-015 Moberg Pharma Topical 40%1) Available H2 2014
Ciclopirox Penlac Sanofi Topical - 29-36%2)
Amorolfin Loceryl Galderma Topical - n/a3)
Terbinafine Lamisil Novartis Oral 40%4) 75%4)
Itraconazole Sporanox J&J Oral 25-30%4) 40-50%4)
Source: 1)Moberg Pharma data on file from ongoing phase II study; 2) Gupta AK, Fleckman P, Baran R. Ciclopirox naillacquer topical solution 8% in the treatment of toenail onychomycosis. J Am Acad Dermatol 43(4 Suppl):S70-80 (2000 Oct); 3) Mycological cure rates have not been published for Loceryl using the standard definition, which is the combination of negative fungal culture and KOH microscopy; 4) Double blind, randomized study of continousterbinafine compared with intermittent itraconazole in the treatment of toenail Onychomycosis, BMJ 1999;
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17 Source: Double blind, randomized study of continous terbinafine compared with intermittent itraconazole in the treatment of toenail Onychomycosis, BMJ 1999
Today’s golden standard is oral terbinafine. LION study demonstrated 40% mycological cure after 6 months
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BuildingA DIFFERENT KIND OF PHARMA COMPANY
Continued strong product demand – Kerasal Nail™ top selling U.S. product in its category
Expanded distribution for key products in the U.S.
Majority of revenues from direct OTC sales
Larger geographical reach – new distributor agreements enable launches in China, MENA, Mexico and Southeast Asia
Strong interim data for MOB-015
Continuous evaluation of acquisition and in-licensing opportunities