Q1 2017 Conference Call · 4/27/2017 · Q1 2017 Financial Highlights Outstanding Operating...

Q1 2017 Conference CallApril 27, 2017

CHANGING THE COURSE OFHUMAN HEALTH THROUGH BOLD

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Q1 2017 Conference CallQ1 2017 Conference Call

Mark Alles, Chief Executive Officer

Scott Smith, President & Chief Operating Officer

Jackie Fouse, EVP, Executive Committee

Q&A

Michael Pehl, President, Hematology/Oncology

Peter Kellogg, Chief Financial Officer

2

Forward Looking Statements and Adjusted Financial InformationForward Looking Statements and Adjusted Financial Information

3

This presentation contains forward-looking statements, which are generally statements that are not historical facts.Forward-looking statements can be identified by the words “expects,” “anticipates,” “believes,” “intends,” “estimates,”“plans,” “will,” “outlook,” “targets” and similar expressions. Forward-looking statements are based on management’scurrent plans, estimates, assumptions and projections, and speak only as of the date they are made. We undertake noobligation to update any forward-looking statement in light of new information or future events, except as otherwiserequired by law. Forward-looking statements involve inherent risks and uncertainties, most of which are difficult to predictand are generally beyond our control. Actual results or outcomes may differ materially from those implied by the forward-looking statements as a result of the impact of a number of factors, many of which are discussed in more detail in ourAnnual Report on Form 10-K and our other reports filed with the Securities and Exchange Commission.

In addition to unaudited financial information prepared in accordance with U.S. GAAP, this presentation also containsadjusted financial measures. Further information relevant to the interpretation of adjusted financial measures, andreconciliations of these adjusted financial measures to the most comparable GAAP measures, may be found in theAppendix and on our website at www.Celgene.com in the “Investor Relations” section.

Mark AllesChief Executive Officer


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Delivering Signficant Catalysts and Value DriversDelivering Signficant Catalysts and Value Drivers

Strengthening Our Commercial Portfolio − Continuously improving the value propositions of our major products

− Committed to further enhancing global patient access

Accelerating the Development of Transformational Products− IDHIFA® (enasidenib) granted priority review; First partnered product from distributed research model

− Positive ozanimod late stage data in RMS (SUNBEAM) - first of 19 Ph III readouts over next 2 years

Expanding and Adding to Our Broad and Deep Pipeline− Numerous key programs advancing in hematology, oncology, I&I and neuroscience

− Targeting at least 8 INDs/CTAs in 2017; Continuing to evaluate and pursue external opportunities

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Peter KelloggChief Financial Officer


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Q1 2017 Financial HighlightsQ1 2017 Financial Highlights

Outstanding Operating Results− Q1:17 year-over-year net product sales grew 18% and adjusted diluted EPS grew 27%− Adjusted operating margins improved by 410 bps

Excellent Product Performance− Strong Q1 performance for REVLIMID®

− Volume represents 15 of the 18 percentage points of net sales growth

Balanced Capital Deployment− $304M in shares repurchased in Q1:17− Expanded autoimmune focus with Delinia Inc. acquisition

7

2017 Adjusted EPS and Operating Margin Updated− 2017 adjusted diluted EPS raised from $7.10-$7.25 to $7.15-$7.30− Adjusted operating margin raised from ~56.5% to ~57%, +50 bps

Q1 2017 Total Net Product SalesQ1 2017 Total Net Product Sales

Q1:15 Q1:16 Q1:17

$2,055

$2,495

$2,950

$ M

illio

ns

↑20% ↑21% ↑18%

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

Q1:16 Volume Price Fx /Hedge

Q1:17

↑18.2%↓0.6%↑14.6% ↑4.2%

Contribution to Q1:17 Total Net Product Sales Growth

$ M

illio

ns

Total Net Product Sales

8Footnote: Growth Rates = Growth vs. Prior Year Period

Q1 2017 Adjusted Diluted Earnings Per ShareQ1 2017 Adjusted Diluted Earnings Per Share

$1.07

$1.32

$1.68

Q1:15 Q1:16 Q1:17

↑29% ↑23%

Dol

lars

Per

Sha

re

↑27%

Q1:16 Oper. Income

OIE Tax Rate Share Count

Q1:17

Dol

lars

Per

Sha

re

$1.68$0.38$1.32 $0.00 ($0.01)($0.01)

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Contribution to Q1:17 Adjusted Diluted EPSAdjusted Diluted EPS

Footnote: Growth Rates = Growth vs. Prior Year Period

Key P&L Line Items (Adjusted)Key P&L Line Items (Adjusted)

Q1:17 ∆ vs.Q1:16

∆ vs.Q4:16

Product Gross Margin 96.4% ↑30 bps ↓10 bps

R&D expenses% of revenue

$595M20.1% ↓340 bps ↓250 bps

SG&A expenses% of revenue

$539M18.2% ↓40 bps ↑30 bps

Operating Margin 58.1% ↑410 bps ↑210 bps

Effective Tax Rate 16.5% ↓10 bps ↑190 bps

10

Cash and Marketable SecuritiesCash and Marketable Securities

Cash flow from operations was approximately $853M during Q1:17

In Q1:17, purchased $304M of shares– $4.4B remaining under existing stock repurchase program

(in Billions) 3/31/17 12/31/16

Cash and Marketable Securities $8.86 $7.97

11

Updating 2017 GuidanceUpdating 2017 Guidance

Previous Updated

Net Product Sales

REVLIMID® $8.0B-$8.3B Unchanged

POMALYST®/IMNOVID® ~$1.6B Unchanged

OTEZLA® $1.5B-$1.7B Unchanged

ABRAXANE® ~$1.0B Unchanged

Total Revenue $13.0B-$13.4B Unchanged

Adjusted Operating Margin ~56.5% ~57%

Adjusted Diluted EPS $7.10-$7.25 $7.15-$7.30

Weighted Average Diluted Shares ~815M Unchanged12

Michael PehlPresident, Hematology/Oncology


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Q1 2017 Hematology/Oncology Franchise ResultsQ1 2017 Hematology/Oncology Franchise Results

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Strong Net Product Sales and Operating Momentum− Q1:17 net sales growth of +18% Y/Y− Sales performance driven by strong demand across brands and geographies

2017 Growth Drivers On Track− Approval in U.S. and EU for the use of REVLIMID® as maintenance therapy post-ASCT− Ongoing REVLIMID® NDMM non-SCT launch and increasing use of approved triplets driving

share and duration around the globe− U.S. regulatory decision for IDHIFA® (enasidenib) in IDH2 mutant rrAML expected in H2:17− Ph III data on REVLIMID® in indolent lymphoma and ABRAXANE® in adjuvant PanC by YE:17

Transformational Pipeline Advancing− Data from early- and mid-stage pipeline expected in 2017− Opportunity to initiate more than 10 additional pivotal programs with later-stage pipeline

Current Results & Potential Future Growth Drivers

Q1 2017 REVLIMID® Net Sales Summary Q1 2017 REVLIMID® Net Sales Summary

• Q1:17 net sales $1,884M; +20% Y/Y, +4% Q/Q• Ongoing NDMM highly successful launch

– REVLIMID® NDMM NSCT reimbursed in 20 countries– Finalize NDMM NSCT reimbursement in France in Q2

• 2017 growth drivers Maintenance post-ASCT approved in U.S. and EU;

Reimbursed in 6 countries in EU; Discussions ongoing• Potential future growth drivers advancing

– U.S. regulatory submission for RVd in 1st line transplant and non-transplant candidates planned by YE:17

– Ph III RELEVANCE & AUGMENT® data expected YE:17– Complete enrollment in Ph III ROBUST® trial with

REVLIMID® in 1st line DLBCL with ABC-subtype

$642$811

$997$1,234

$502

$532

$577

$650

Q1:14 Q1:15 Q1:16 Q1:17

U.S. ROW

$1,144

$1,343

$1,574

$1,884

15

Net Sales ($M)

ASCT Induction and Post-ASCT Maintenance OpportunityASCT Induction and Post-ASCT Maintenance Opportunity

36%

46%

18%

72%

28%

16

Opportunity

REVLIMID®-based Induction

Opportunity

Post-ASCT MaintenanceASCT Induction

REVLIMID®

maintenance

12%

88%

8%

92% Opportunity

REVLIMID®-based Induction

Opportunity

REVLIMID®

maintenance

REVLIMID®

maintenance fixed duration

Source: Celgene Market Research

U.S.

EU


Q1 2017 REVLIMID® Net Sales Summary Q1 2017 REVLIMID® Net Sales Summary

• Q1:17 net sales $1,884M; +20% Y/Y, +4% Q/Q• Ongoing NDMM highly successful launch

– REVLIMID® NDMM NSCT reimbursed in 20 countries– Finalize NDMM NSCT reimbursement in France in Q2

• 2017 growth drivers Maintenance post-ASCT approved in U.S. and EU;

Reimbursed in 6 countries in EU; Discussions ongoing• Potential future growth drivers advancing

– U.S. regulatory submission for RVd in 1st line transplant and non-transplant candidates planned by YE:17

– Ph III RELEVANCE & AUGMENT® data expected YE:17– Complete enrollment in Ph III ROBUST® trial with

REVLIMID® in 1st line DLBCL with ABC-subtype

$642$811

$997$1,234

$502

$532

$577

$650

Q1:14 Q1:15 Q1:16 Q1:17

U.S. ROW

$1,144

$1,343

$1,574

$1,884

17

Net Sales ($M)


Q1 2017 POMALYST®/IMNOVID® Net Sales SummaryQ1 2017 POMALYST®/IMNOVID® Net Sales Summary

$89$129

$171$216$47

$70

$103

$148

Q1:14 Q1:15 Q1:16 Q1:17

U.S. ROW

$136

$199

$274

$364

• Q1:17 net sales $364M; +33% Y/Y, -4% Q/Q• Successful global launch of POMALYST®/IMNOVID®

continues – POMALYST®/IMNOVID® has leading 3rd line share in

U.S. and EU– POMALYST® has leading 3rd line+ share in Japan

• 2017 growth drivers Duration trends increasing across all geographies FDA regulatory decision for daratumumab/POMALYST®

expected in Q2:17• Potential future growth drivers advancing

Enrollment in Ph III OPTIMISMM® trial with POMALYST®

in 2nd line+ MM completed; Data expected in 2018 POMALYST®/IMNOVID® combinations with other novel

agents advancing

Net Sales ($M)

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Q1 2017 ABRAXANE® Net Sales SummaryQ1 2017 ABRAXANE® Net Sales Summary

$142 $159 $144 $142

$43

$64 $81 $94

Q1:14 Q1:15 Q1:16 Q1:17

U.S. ROW

$185

$223 $225$236Net Sales ($M)

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• Q1:17 net sales $236M; +5% Y/Y, -11% Q/Q• 2017 growth drivers

Maintain leadership in first-line metastatic pancreatic cancer in U.S.

Continue uptake in metastatic pancreatic cancer and metastatic breast cancer in EU

• Potential future growth drivers advancing Ph III apact® data for ABRAXANE® in adjuvant

pancreatic cancer by YE:17 I/O combination trials in NSCLC, TNBC Ongoing trials in support of potential label expansions in

pancreatic cancer, lung and breast cancer

Expected Data Presentations in Q2 2017Expected Data Presentations in Q2 2017

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ASCO• Final OS data from the CALGB 100104 trial with REVLIMID®

as maintenance in NDMM• Updated data from the Ph III MAGNIFYTM trial with REVLIMID®

in indolent lymphoma• Updated data from Ph I trial with bb2121 in RRMM• Updated data from Ph I TRANSCEND trial with JCAR017 in

relapsed and/or refractory aggressive NHL• Updated data from Ph I/II trial with IDHIFA® (enasidenib) in

relapsed and/or refractory AML with an IDH2 mutation

MDS Foundation• Ph II data with luspatercept in first-line, lower-risk MDS

Maximizing the Luspatercept OpportunityMaximizing the Luspatercept Opportunity

21

ASCO• Final OS data from the CALGB 1000104 trial with REVLIMID®

as maintenance in NDMM• Updated data from Ph I trial with bb2121 in RRMM• Updated data from the Ph III MAGNIFYTM trial with REVLIMID®

in indolent lymphoma• Updated data from Ph I TRANSCEND trial with JCAR017 in

relapsed and/or refractory aggressive NHL• Updated data from Ph I/II trial with IDHIFA® (enasidenib) in

relapsed and/or refractory AML with an IDH2 mutation

MDS Foundation• Ph II data with luspatercept in ESA-naïve MDS

MEDALISTTM and BELIEVETM enrollment expected to complete in Q2:17

Data expected in mid-2018

Plans to initiate Ph III trial in first-line, lower-risk MDS in early 2018

Plans to initiate Ph II trial in myelofibrosis by YE:17

2017 Hematology/Oncology Franchise Outlook2017 Hematology/Oncology Franchise Outlook

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On Track to Deliver 2017 Guidance− 2017 REVLIMID® net sales guidance of $8B-$8.3B− 2017 POMALYST®/IMNOVID® net sales guidance of ~$1.6B− 2017 ABRAXANE® net sales guidance of ~$1B

Regulatory Catalysts to Expand Portfolio− REVLIMID® as maintenance therapy post-ASCT approved in U.S. and EU− U.S. regulatory decision for IDHIFA® (enasidenib) in IDH2 mutant rrAML expected in H2:17− On track to submit RVd in U.S. for NDMM by YE:17

Significant Progress in Developing Mid- and Late-Stage Pipeline− Advancing additional lifecycle opportunities for luspatercept, CC-486 and IDHIFA® (enasidenib)− On-track for marizomib, bb2121, JCAR017, CC-122 and durvalumab pivotal studies by YE:17

Scott SmithPresident & Chief Operating Officer


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Q1 2017 I&I Franchise ResultsQ1 2017 I&I Franchise Results

Positive Brand Fundamentals Continue for OTEZLA®

– Key performance indicators remain strong despite challenging Q1 U.S. market dynamics – Overall market share continues to grow– Leading new-to-brand share in both psoriasis and PsA

– Implemented new contracts with major U.S. payers that doubled the number of commercial lives with bio-step-free access

Expanding OTEZLA® Global Footprint– Uptake accelerating across major international markets– Strong signals of demand in recently launched markets, including France, UK and Japan

Advancing Development of I&I Pipeline– Ozanimod SUNBEAM Ph III trial in MS met all key endpoints– Positive results from ozanimod CD Ph II support initiation of Ph III development – Executing pivotal programs for GED-0301 in CD and for ozanimod in UC

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• Q1:17 net sales $242M; +24% Y/Y, -21% Q/Q

• Increasing OTEZLA® adoption as U.S. and global access continues to improve

• Launch underway across all major European markets and Japan

Q1 2017 OTEZLA® Net Sales Summary Q1 2017 OTEZLA® Net Sales Summary


$175$199

$21

$43

Q1:15 Q1:16 Q1:17

U.S. ROW

$60

$196

$242

Net Sales ($M)

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Sequential Growth Challenge Driven by Short-term HeadwindsSequential Growth Challenge Driven by Short-term Headwinds

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U.S. Weekly Psoriasis/PsA Market TRx Volume

‐7.9%(2015)

‐7.1%(2016)

‐12.4%(2017) ‐15%

‐10%

‐5%

0%

5%

10%

0

10

20

30

40

50

60

4 wk vs. 4wk %Ch

g

Total M

arket T

Rx (T

housands)

4wk vs. 4wk %Chg Weekly Market TRx

Note: market basket includes: acitretin, CIMZIA®, COSENTYX®, cyclosporine, leflunomide, ENBREL®, HUMIRA®, methotrexate, OTEZLA®, REMICADE®, STELARA®, SIMPONI®, sulfasalazine, TALTZ®, and XELJANZ®; topicals are excludedSource: Symphony prescriber weekly data through 3/24/17, updated on 3/31/17

Q1 Headwinds

• U.S. psoriasis/PsA market TRx contraction greater than in prior years

• Increased GTN adjustments related to contracts implemented in January to remove biologic step-edits in major health plans

• Modest inventory draw-down through the first quarter

16%

Expanding Foundation for Future GrowthExpanding Foundation for Future Growth

27

OTEZLA®

23.3%

0%

5%

10%

15%

20%

25%

30%

35%

40%

Jan-

15Fe

b-15

Mar

-15

Apr-

15M

ay-1

5Ju

n-15

Jul-1

5Au

g-15

Sep-

15O

ct-1

5N

ov-1

5D

ec-1

5Ja

n-16

Feb-

16M

ar-1

6Ap

r-16

May

-16

Jun-

16Ju

l-16

Aug-

16Se

p-16

Oct

-16

Nov

-16

Dec

-16

Jan-

17Fe

b-17

Mar

-17

ENBREL STELARA HUMIRACOSENTYX OTEZLA TALTZ

Source: SHS claims data through Jan'17; last updated 24 March 2017; Symphony Prescriber-level data through week ending 31 March 2017Note: NTB includes commercial, PAP and bridge Rx for OTEZLA®. Topicals excluded from PsO market

Q1:2016

Q2:2016

Q3:2016

Q4:2016

Q1:2017

Plan A

Q1:2016

Q2:2016

Q3:2016

Q4:2016

Q1:2017

Plan B

Q1:2016

Q2:2016

Q3:2016

Q4:2016

Q1:2017

Plan C

New Market Access Contributing to Share Gains*(Actual Health Plan Market Shares)

0%

U.S. Psoriasis Market Share

*Three major plans affecting up to 100 million covered lives

16%

Expanding Foundation for Future GrowthExpanding Foundation for Future Growth

28

OTEZLA®

23.3%

0%

5%

10%

15%

20%

25%

30%

35%

40%

Jan-

15Fe

b-15

Mar

-15

Apr-

15M

ay-1

5Ju

n-15

Jul-1

5Au

g-15

Sep-

15O

ct-1

5N

ov-1

5D

ec-1

5Ja

n-16

Feb-

16M

ar-1

6Ap

r-16

May

-16

Jun-

16Ju

l-16

Aug-

16Se

p-16

Oct

-16

Nov

-16

Dec

-16

Jan-

17Fe

b-17

Mar

-17

ENBREL STELARA HUMIRACOSENTYX OTEZLA TALTZ

Source: SHS claims data through Jan'17; last updated 24 March 2017; Symphony Prescriber-level data through week ending 31 March 2017Note: NTB includes commercial, PAP and bridge Rx for OTEZLA®. Topicals excluded from PsO market

Q1:2016

Q2:2016

Q3:2016

Q4:2016

Q1:2017

Plan A

Q1:2016

Q2:2016

Q3:2016

Q4:2016

Q1:2017

Plan B

Q1:2016

Q2:2016

Q3:2016

Q4:2016

Q1:2017

Plan C

New Market Access Contributing to Share Gains*(Actual Health Plan Market Shares)

0%

U.S. Psoriasis Market Share

*Three major plans affecting up to 100 million covered lives

Future Success Drivers• Positive Ph IV UNVEIL data in moderate psoriasis

• Ph III scalp psoriasis trial initiated

• Lifecycle development in UC, Behçet's, once-daily, and others

• Q2 trajectory puts us on track for full year 2017 guidance

Future Success Drivers• Positive Ph IV UNVEIL data in moderate psoriasis

• Ph III scalp psoriasis trial initiated

• Lifecycle development in UC, Behçet's, once-daily, and others

• Q2 trajectory puts us on track for full year 2017 guidance

WW Targeted Market Size ($B)

2017E 2020ESUNBEAM (Ph III) trial met its primary and measured secondary endpoints; safety and tolerability consistent with Ph II studiesRADIANCE (Ph III) readout on target for Q2:17

650 $22 $27

STEPSTONE (Ph II) positive results support initiation of Ph III program 1,000 $8 $10

TRUE NORTH (Ph III) enrollment accelerating; data expected in 2018 1,300 $6.5 $8

Total 2,950 $36.5 $45

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Ozanimod: Building Our Next Transformational TherapyOzanimod: Building Our Next Transformational Therapy

Source: Evaluate Pharma; CDC; Decision Resources; GlobalData; Datamonitor; internal Celgene estimates

Development Program Status UpdateUS and EU G5 Prevalence (K)

Relapsing Multiple Sclerosis

Crohn’s Disease

Ulcerative Colitis

2017 I&I Franchise Outlook 2017 I&I Franchise Outlook

Maximizing the OTEZLA® Opportunity Realize benefit from improved U.S. access position Accelerate launch across major European markets and Japan Complete Ph II in ulcerative colitis; Accelerate development in additional lifecycle indications File sNDA for QD formulation by YE:17

Advancing GED-0301 Development in IBD Enrollment of GED-0301 pivotal trials in CD on track Complete GED-0301 Ph II trial in UC in mid-2017

Advancing Development of the I&I Pipeline− Initiate CC-220 randomized Ph IIb for SLE− Initiate CC-90001 idiopathic pulmonary fibrosis Ph II trial

30

Advancing Ozanimod Development Programs in MS and IBD− Ph III ozanimod results in MS− Submit ozanimod U.S. NDA in RMS and accelerate global commercial activities− Advance ozanimod Ph III in ulcerative colitis and initiate Ph III program in Crohn’s disease

Jackie FouseEVP, Executive Committee


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Strong Momentum; Approaching Inflection PointStrong Momentum; Approaching Inflection Point

Outstanding Execution Lays the Foundation for Long-term Growth

Portfolio Diversification Well Underway: Pipeline and Products

Strategy is Delivering

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Strong Momentum; Approaching Inflection PointStrong Momentum; Approaching Inflection Point

Outstanding Execution Lays the Foundation for Long-term Growth

Portfolio Diversification Well Underway: Pipeline and Products

Strategy is Delivering

33

Key Catalysts in 2017Hematology/Oncology Regulatory decision on REVLIMID® in maintenance post- ASCT (H1)− Submit sNDA for RVd in NDMM (H2)− U.S. regulatory decision on IDHIFA® (enasidenib) in IDH2 mutant rrAML (H2)− Ph III data for REVLIMID® in FL (RELEVANCE & AUGMENT®) and ABRAXANE® (apact®) (YE)− POC data for CC-486 in mBC and durvalumab in RRMM, 1st line MDS and AML (throughout

2017)

Inflammation & Immunology− Ozanimod in RMS top-line Ph III data (H1)− Submit sNDA for OTEZLA® once-daily formulation (H2)− Submit NDA for ozanimod in RMS (YE) − POC data for OTEZLA® in UC, GED-0301 in UC and ozanimod in CD (throughout 2017)

Q1 2017 Conference CallApril 27, 2017


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Reconciliation Tables


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Reconciliation TablesReconciliation Tables

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Use of Non-GAAP Financial Measures In addition to financial information prepared in accordance with U.S. GAAP, this document also contains certain non-GAAP financial measures based on management’s view of performance including:

Adjusted research and development expense Adjusted selling, general and administrative expense Adjusted operating margin Adjusted net income Adjusted earnings per share

Management uses such measures internally for planning and forecasting purposes and to measure the performance of the Company. We believe these adjusted financial measures provide useful and meaningful information to us and investors because they enhance investors’ understanding of the continuing operating performance of ourbusiness and facilitate the comparison of performance between past and future periods. These adjusted financial measures are non-GAAP measures and should be considered in addition to, but not as a substitute for, the information prepared in accordance with U.S. GAAP. When preparing these supplemental non-GAAP financial measures we typically exclude certain GAAP items that management does not consider to be normal, recurring, cash operating expenses but that may not meet the definition of unusual or non-recurring items. Other companies may define these measures in different ways. The following categories of items are excluded from adjusted financial results: Acquisition and Divestiture-Related Costs: We exclude the impact of certain amounts recorded in connection with business combinations and divestitures from ouradjusted financial results that are either non-cash or not normal, recurring operating expenses due to their nature, variability of amounts, and lack of predictability as to occurrence and/or timing. These amounts may include non-cash items such as the amortization of acquired intangible assets, amortization of purchase accountingadjustments to inventories, intangible asset impairment charges and expense or income related to changes in the estimated fair value measurement of contingent consideration. We also exclude transaction and certain other cash costs associated with business acquisitions and divestitures that are not normal recurring operating expenses, including severance costs which are not part of a formal restructuring program. Share-based Compensation Expense: We exclude share-based compensation from our adjusted financial results because share-based compensation expense, which is non-cash, fluctuates from period to period based on factors that are not within our control, such as our stock price on the dates share-based grants are issued.


37

Collaboration-related Upfront Expenses: We exclude collaboration-related upfront expenses from our adjusted financial results because we do not consider them tobe normal, recurring operating expenses due to their nature, variability of amounts, and lack of predictability as to occurrence and/or timing. Upfront payments to collaboration partners are made at the commencement of a relationship anticipated to continue for a multi-year period and provide us with intellectual property rights, option rights and other rights with respect to particular programs. The variability of amounts and lack of predictability of collaboration-related upfront expenses makes the identification of trends in our ongoing research and development activities more difficult. We believe the presentation of adjusted research and development, which does not include collaboration-related upfront expenses, provides useful and meaningful information about our ongoing research and development activities byenhancing investors’ understanding of our normal, recurring operating research and development expenses and facilitates comparisons between periods and with respectto projected performance. All expenses incurred subsequent to the initiation of the collaboration arrangement, such as research and development cost-sharing expenses/reimbursements and milestone payments up to the point of regulatory approval are considered to be normal, recurring operating expenses and are included in our adjusted financial results. Research and Development Asset Acquisition Expense: We exclude costs associated with acquiring rights to pre-commercial compounds because we do not consider such costs to be normal, recurring operating expenses due to their nature, variability of amounts, and lack of predictability as to occurrence and/or timing. Research and development asset acquisition expenses includes expenses to acquire rights to pre-commercial compounds from a collaboration partner when there will be no further participation from the collaboration partner or other parties. The variability of amounts and lack of predictability of research and development asset acquisition expenses makes the identification of trends in our ongoing research and development activities more difficult. We believe the presentation of adjusted research and development, which does not include research and development asset acquisition expenses, provides useful and meaningful information about our ongoing research and developmentactivities by enhancing investors’ understanding of our normal, recurring operating research and development expenses and facilitates comparisons between periods and with respect to projected performance. Restructuring Costs: We exclude costs associated with restructuring initiatives from our adjusted financial results. These costs include amounts associated with facilities to be closed, employee separation costs and costs to move operations from one location to another. We do not frequently undertake restructuring initiatives and therefore do not consider such costs to be normal, recurring operating expenses. Certain Other Items: We exclude certain other significant items that may occur occasionally and are not normal, recurring, cash operating expenses from our adjusted financial results. Such items are evaluated on an individual basis based on both the quantitative and the qualitative aspect of their nature and generally represent itemsthat, either as a result of their nature or magnitude, we would not anticipate occurring as part of our normal business on a regular basis. While not all-inclusive, examples of certain other significant items excluded from adjusted financial results would be: expenses for significant fair value adjustments to equity investments, significant litigation-related loss contingency accruals and expenses to settle other disputed matters. Estimated Tax Impact From Above Adjustments: We exclude the net income tax impact of the non-tax adjustments described above from our adjusted financial results. The net income tax impact of the non-tax adjustments includes the impact on both current and deferred income taxes and is based on the taxability of the adjustment under local tax law and the statutory tax rate in the tax jurisdiction where the adjustment was incurred.


38

Non-Operating Tax Adjustments: We exclude the net income tax impact of certain other significant income tax items, which are not associated with our normal,recurring operations (“Non-Operating Tax Items”), from our adjusted financial results. Non-Operating Tax Items include items which may occur occasionally and are not normal, recurring operating expenses (or benefits), including adjustments related to acquisitions, divestitures, collaborations, certain adjustments to the amount of unrecognized tax benefits related to prior year tax positions, and other similar items. We also exclude excess tax benefits and tax deficiencies that arise upon vesting orexercise of share-based payments recognized as income tax benefits or expenses due to their nature, variability of amounts, and lack of predictability as to occurrence and/or timing. See the attached Reconciliations of GAAP to Adjusted Net Income for explanations of the amounts excluded and included to arrive at the adjusted measures for thethree-month periods ended March 31, 2017 and 2016, and for the projected amounts for the twelve-month period ending December 31, 2017.


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Appendix


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2017 Milestones2017 Milestones

Financial Performance Total Revenue $13.0B-$13.4B REVLIMID® net sales $8.0B-$8.3B POMALYST® net sales ~$1.6B OTEZLA® net sales $1.5B-$1.7B ABRAXANE® net sales ~$1.0B Adj. operating margin ~56.5%1 Adj operating margin ~57.0%2

Adj. EPS $7.10-$7.251 Adj EPS $7.15 to $7.302

Clinical Data Ph III apact® – ABRAXANE® in adjuvant PanC Ph III RELEVANCE – REVLIMID® in 1st line FL Ph III AUGMENT® – REVLIMID® in RR FL Ph III Ozanimod in multiple sclerosis (SUNBEAM and RADIANCE) Ph II CC-486 with fulvestrant in ER+ HER2- mBC Ph II Demcizumab in NSCLC (DENALI)X Ph II Demcizumab in PanC (YOSEMITE) Ph II OTEZLA® in UC Ph II GED-0301 in UC Ph II STEPSTONE - Ozanimod in CD Ph I/II Durvalumab in RRMM and 1st Line MDS and AML

Trial Enrollment Complete enrollment in Ph III CD-002 – GED-0301 in CD Complete enrollment in Ph III OPTIMISSM® trial

– POMALYST® in 2nd Line MM Complete enrollment in Ph III ROBUST® - REVLIMID® in DLBCL Complete enrollment in Ph III QUAZAR® - CC-486 in AML Complete enrollment in Ph III MEDALISTTM – Luspatercept in MDS Complete enrollment in Ph III BELIEVETM – Luspatercept in beta-thalassemia Complete enrollment in Ph III RELIEF® – OTEZLA® in Behçet’s Complete enrollment in Ph III TRUE NORTH – Ozanimod in UC

Regulatory Submissions/Decisions FDA decision of REVLIMID® in post-ASCT maintenance EU decision of REVLIMID® in post-ASCT maintenance Submit sNDA for RVd in NDMM FDA decision on IDHIFA® in IDH2-mutated AML Submit sNDA for OTEZLA® once-daily formulation Submit NDA for Ozanimod in RMS

Trial Initiations Initiate pivotal trial with CC-122 in NHL Initiate pivotal trial with bb2121 in RRMM Initiate pivotal trial with JCAR017 in NHL Initiate Ph III trial with OTEZLA® in scalp PSOR Initiate Ph III trial with OTEZLA® in AS Initiate Ph III trial with RPC4046 in EoE Initiate pivotal trial with Marizomib in GBM Initiate Ph II trial with Luspatercept in myelofibrosis

R&ED File at least 8 IND’s

441. Original January 2017 2. Updated April 2017

Advancing a High Quality Pipeline with Significant PotentialAdvancing a High Quality Pipeline with Significant Potential

REVLIMID®

Del 5q MDS

VIDAZA®

MDS, AML

IDHIFA®

IDH2 AML

LuspaterceptMDS, Beta-thalassemia

CC-486 MDS, AML

DurvalumabMDS, AML

CC-90002AML

CC-90009AML

PNK-007AML

MyeloidDisease

9

MarizomibGBM

DemcizumabNSCLC

CC-486NSCLC, mBC

CC-122HCC

CC-90002Solid TumorsCC-90011

Solid Tumors

ABRAXANE®

PanC, NSCLC, mBC

AG-881Glioma

SolidTumors

13

TIGITSolid Tumors

OMP-305B83Solid Tumors

OMP-131R10Solid Tumors

LYC-55716Solid Tumors

JTX-2011Solid Tumors

Inflammation& Immunology

12OzanimodIBD, MS

OTEZLA®

PSOR, PSA

OTEZLA®

Behçet's, AS

GED-0301IBD

RPC-4046EoE

OTEZLA®

UCCC-220

SLE

CC-90001 IPF

CC-90006PSOR

FT-4101NASH

LYC-30937UC, PSOR

ABX-1431Neuro, Pain

MarketPh I

L E G E N D

Celgene has an exclusive option to license Demcizumab, JTX-2011, LYC-55716, LYC-30937, OMP-131R10, OMP-305B83, and TIGIT

REVLIMID®

MCL

ISTODAX®

PTCL, CTCL

REVLIMID®

NHLCC-122NHL, CLL

JCAR017NHL

DurvalumabNHL, CLL

CC-486NHL

Lymphoma& Leukemia

7

REVLIMID®

NDMM, RRMM

POMALYST®

RRMM

THALOMID®

NDMM, RRMM

CC-122RRMM

CC-220RRMM Durvalumab

NDMM, RRMM

bb2121RRMM

PNK-007RRMM

MarizomibRRMM

ACY-241RRMM

CC-486RRMM

MultipleMyeloma

11

45

REVLIMID® Multiple Myeloma Late Stage ProgramsREVLIMID® Multiple Myeloma Late Stage Programs

Patient Population Maintenance Post-VMP induction

Trial NameMM-026ARUMM

Phase III

Target Enrollment 350

Design

2:1 randomizationInduction with Melphalan/prednisone/bortezomib (VMP)

for 6-9 cyclesArm A: REVLIMID® (10mg) d 1-21

for 28-day cycleArm B: Placebo d 1-21 for 28-day cycle

Primary Endpoint Progression Free Survival

StatusEnrollment complete

Trial ongoing

46

REVLIMID® Multiple Myeloma Late Stage ProgramsREVLIMID® Multiple Myeloma Late Stage Programs

Patient Population Induction and Maintenance in ASCT EligibleTrial Name MYELOMA XI

Phase III

Target Enrollment 3,970

Design

Arm A: Cyclophosphamide (500mg) d1,8,15; THALOMID® (100mg d1-21 then 200mg daily), Dexamethasone (40mg) d1-4, 12-15 for minimum of 4 21-day cycle

Arm B: REVLIMID® (25mg) d 1-21, Cyclophosphamde (500mg) d1,8, dexamethasone (40mg) d1-4,12-15 for minimum of 4 28-day cycles

Arm C: Cyclophosphamde (500mg) d1,8, Carfilzomib (20 mg/m2) d 1,2 cycle 1 then (36 mg/m2) d 1,2,8,9,15,16, REVLIMID® (25mg) d1-21, Dexamethasone (40mg) d 1-4,8,9,15,16 for 4 21-day cycles

Patients with no change, progressive disease, PR or MR randomized toArm A: Bortezomib (1.3mg/m2) d 1,4,8,11, Cyclophosphamide (500mg) d 1,8,15, Dexamethasone (20mg) d

1,2,4,5,8,9,11,12 for max of 8 21-day cyclesArm B: No treatmentAll patients go to SCT

After SCT randomization to:Arm A: REVLIMID® (10mg) d 1-21 for 28-day cycle to disease progression

Arm B: No maintenance

Primary Endpoint Overall Survival and Progression Free Survival

Status Interim data presented at ASH 2016

47

POMALYST®/IMNOVID® Multiple Myeloma Late Stage ProgramsPOMALYST®/IMNOVID® Multiple Myeloma Late Stage Programs

Patient Population RRMM

Trial NameMM-007

OPTIMISMM®

Phase III


Design

Arm A: POMALYST®/IMNOVID® (4mg), bortezomib (1.3 mg/m2 IV) and low-dose dexamethasone to disease

progressionArm B: Bortezomib (1.3 mg/m2 IV) and low-dose

dexamethasone to disease progression



Data in 2018E

48

MDS/AML/MF Late Stage ProgramsMDS/AML/MF Late Stage Programs

Patient Population Low risk/INT-1 transfusion-dependent MDS Post induction AML Maintenance

MoleculeCC-486

(Oral Azacitidine)CC-486

(oral azacitidine)

Trial Name AZA-MDS-003 CC-486-AML-001

Phase III III

Target Enrollment 386 460

DesignArm A: CC-486 (150mg or 200mg)

Arm B: PlaceboArm A: CC-486 (150mg or 200mg)

Arm B: Best Supportive Care

Primary Endpoint RBC-transfusion independence for more than 12 weeks Overall Survival

Status Trial enrolling Trial enrolling

49


Patient Population Anemia in to Very Low-, Low-, or Intermediate-Risk MDS

Red Blood Cell Transfusion Dependent Beta-Thalassemia

Molecule Luspatercept Luspatercept

Trial Name MEDALISTTM BELIEVETM

Phase III III


DesignArm A: Luspatercept (Starting dose of 1.0 mg/kg

subcutaneous injection every 3 weeks)Arm B: Placebo (Subcutaneous injection every 3

weeks)

Arm A: Luspatercept (1mg/kg plus Best Supportive Care)

Arm B: Placebo plus Best Supportive Care

Primary Endpoint Red Blood Cell Transfusion Independence (RBC-TI) ≥ 8 weeks

Proportion of subjects with hematological improvement from Week 13 to Week 24 compared

to 12-week prior to randomizationHematological improvement from Week 13 to Week

24 compared to the 12-week.

Status Trial enrolling Trial enrolling

50


Patient Population IDH2 Mutant AML

Molecule IDHIFA® (Enasidenib, AG-221)

Trial Name IDHENTIFYTM

Phase III


Design Arm A: IDHIFA® (100 mg daily , 28-day cycle) + Best supportive care

Arm B: Best supportive care

Primary Endpoint Overall survival

Status Trial enrolling

51

REVLIMID® Lymphoma Late Stage ProgramsREVLIMID® Lymphoma Late Stage Programs

Patient Population Relapsed or Refractory Follicular Lymphoma

Newly Diagnosed Follicular Lymphoma

Untreated Activated B-Cell DLBCL

Trial NameAUGMENT®

NHL-007RELEVANCE®

ROBUST®

DLC-002

Phase III III III

Target Enrollment 350 1,000 560

Design

Arm A: REVLIMID® (10-20mg) D1-21 / Rituximab 375 mg/m2 weekly for cycle 1 then D 1 of cycles 2-5 for 5 28-day

cyclesArm B: Placebo D1-21, / Rituximab 375

mg/m2 weekly for cycle 1 then D 1 of cycles 2-5 for 5 28-day cycles

Arm A: REVLIMID® (starting dose 20mg)

D2-22 for up to 18 28-day cycles and Rituximab (starting dose 375 mg/m2)

weekly for up to 12 28-day cyclesArm B: Physician’s choice of rituximab-

CHOP, rituximab-CVP or rituximab-bendamustine

Arm a: REVLIMID® (15mg) D1-14/+ R-CHOP21 for 6 21-day cycles

Arm B: Placebo + R-CHOP21 for 6 cycles

Primary Endpoint Progression Free Survival Complete Response Rate and Progression Free Survival Progression Free Survival


Data in 2017EEnrollment complete

Data in 2017ETrial enrollingData in 2019E

52

REVLIMID® Lymphoma Late Stage ProgramsREVLIMID® Lymphoma Late Stage Programs

Patient Population Relapsed or Refractory Indolent Lymphoma

Trial NameMAGNIFYTM

NHL-008

Phase III


Design

Arm A: REVLIMID® (10-20mg) D1-21 / Rituximab 375 mg/m2 weekly for cycle 1 then D 1 of cycles 3, 5, 7,9 and 11 for 12 28-day cycles followed by REVLIMID® (10mg) D1-21 / Rituximab 375 mg/m2 D

1 of cycles 13, 15, 17,19, 21, 23, 25, 27 and 29 for 18 28-day cycles followed by REVLIMID® (10mg) D 1-21 until disease progression – 28 day cycle

Arm B: REVLIMID® (10-20mg) D1-21 / Rituximab 375 mg/m2 weekly for cycle 1 then D 1 of cycles 3, 5, 7,9 and 11 for 12 28-day cycles followed by REVLIMID® (10mg) D1-21 / Rituximab 375 mg/m2 D

1 of cycles 13, 15, 17,19, 21, 23, 25, 27 and 29 for 18 28-day cycles


StatusTrial enrollingData in 2020E

53

ABRAXANE® Solid Tumor Late Stage ProgramsABRAXANE® Solid Tumor Late Stage Programs

Patient Population First Line Stage IIIB / IV Squamous NSCLC Adjuvant Therapy in Surgically Resected Pancreatic Cancer

Trial NameNSCL-003

abound.sqm®

PANC-003apact®

Phase III III


Design

Arm A: Induction – ABRAXANE® (100 mg/m2) D 1, 8 and 15 / Carboplatin (6 mg/min/ml) D 1 of a 21-day cycle; Maintenance – ABRAXANE® (100 mg/m) D 1

and 8 of a 21-day cycle or Best supportive careArm B: Induction – ABRAXANE® (100 mg/m2) D 1, 8 and 15 / Carboplatin (6 mg/min/ml) D 1 of a 21-day

cycle; Maintenance – Best supportive care

Arm A: ABRAXANE® (125 mg/m2) / Gemcitabine (1000 mg/m2) D 1, 8 and 15 for 6 28-day cycles

Arm B: Gemcitabine (1000 mg/m2) D 1, 8 and 15 for 6 28-day cycles.

Primary Endpoint Progression Free Survival Disease Free Survival


Enrollment completeData in 2017E

54

I&I Late Stage ProgramsI&I Late Stage Programs

Patient Population Active Behçet’s Disease Scalp Psoriasis

Molecule OTEZLA® OTEZLA®

Trial NameBCT-002RELIEF®

SPSO-001STYLETM

Phase III III


DesignArm A: Placebo for 12 weeks followed by 30mg

OTEZLA® twice daily for 52 weeksArm B: 30mg OTEZLA® twice daily for 64

weeks

Arm A: Placebo for 16 weeks followed by 30mg OTEZLA® twice daily for 16 weeks

Arm B: Placebo for 32 weeks

Primary Endpoint Area under the curve (AUC) for the number of oral ulcers from baseline through week 12

Proportion of subjects with ScPGA score of clear (0) or almost clear (1) with at least a 2-

point reduction from baseline at Week 16


Initiated; Not yet enrolling

55


Patient Population Active Crohn’s Disease Moderate to Severe Ulcerative Colitis

Molecule GED-0301 Ozanimod

Trial Name CD-002 TRUE NORTH

Phase III III

Target Enrollment 1,064 900

Design

Arm A: GED-301 160mg daily 12 weeks/GED-301 40mg daily 40 weeks

Arm B: GED-301 160mg daily 12 weeks/GED-301 40mg daily 4 weeks on/4 weeks off 40 weeks

Arm C: GED-301 160mg daily 12 weeks/GED-301 160mg daily 4 weeks on/4 weeks off 40 weeks

Arm A: Ozanimod 1mg (daily for induction and maintenance)

Arm B: Placebo (induction and maintenance)

Primary Endpoint Clinical remission defined by Crohn's Disease Activity Index (CDAI)

Clinical remission assessed by Mayo component sub-scores at week 10

Clinical remission assessed by Mayo component sub-scores at week 52

StatusEnrolling

Data in 2018EEnrolling

Data in 2018E

56


Patient Population Relapsing Multiple Sclerosis Relapsing Multiple Sclerosis

Molecule Ozanimod Ozanimod

Trial Name SUNBEAM RADIANCE

Phase III II/III

Target Enrollment ~1300 ~1300

DesignArm A: Ozanimod (0.5mg) daily/placebo IM weeklyArm B: Ozanimod (1mg) daily/placebo IM weekly

Arm C: Oral placebo daily/Beta-interferon IM weekly

Phase IIArm A: Ozanimod (0.5mg) dailyArm B: Ozanimod (1mg) daily

Arm C: Placebo dailyPhase III

Arm A: Ozanimod (0.5mg) daily/placebo IM weeklyArm B: Ozanimod (1mg) daily/placebo IM weekly

Arm C: Oral placebo daily/Beta-interferon IM weekly

Primary Endpoint Annualized relapse rate at month 12 Annualized relapse rate at month 24

StatusData top-lined

Full data expected in H2:17Enrollment complete

Top-line data expected in Q2:17

57

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