Beruflich Dokumente
Kultur Dokumente
February/2018
Disclaimer
This release contains forward-looking statements that are exclusively related to the prospects of the business, its operating
and financial results, and prospects for growth. These data are merely projections and, as such, based exclusively on our
management's expectations for the future of the business and its continued access to capital to fund its business plan.
These forward-looking statements substantially depend on changing market conditions, government regulations,
competitive pressures, the performance of the Brazilian economy and the industry, among other factors, as well as the
risks shown in our filed disclosure documents, and are therefore subject to change without prior notice.
As a goal to maintain a correlation with the Financial Statements prepared by its external auditors, the considerations and
comments contained herein are prepared on a consolidated viewpoint of the economic group Hypera, and not necessarily
individualized by the various legal entities that compose the group.
In addition, unaudited information herein reflects management's interpretation of information taken from its financial
statements and their respective adjustments, which were prepared in accordance with market practices and for the sole
purpose of a more detailed and specific analysis of our results. Therefore, these additional points and data must also be
analyzed and interpreted independently by shareholders and market agents, who should carry out their own analysis and
draw their own conclusions from the results reported herein. No data or interpretative analysis provided by our
management should be treated as a guarantee of future performance or results and are merely illustrative of our directors'
vision of our results.
Our management is not responsible for compliance or accuracy of the management financial data discussed in this report.
which must be considered as for informational purposes only, and should not override the analysis of our audited
consolidated financial statements for purposes of a decision to invest in our stock, or for any other purpose.
2
Agenda
Business Overview
Market Characteristics
Financials
3
Business overview
Ranking
Branded Consumer #3 GSK Sanofi Cimed
Prescription Health
41% #4 Takeda Novartis Sanofi
30%
#5 Pfizer Hypera Eurofarma
Branded
Generics Focus in Brazil Long experience
29% Key Facts
Business Overview
Financials
5
Pharma market
6
SOURCE: IMS Health (May 2016)
Main markets growth
India 12%
Brazil 9%
EM 8%
USA 8%
Russia 7%
China 7%
Global 6%
UK 6%
RoW 5%
Germany 4%
Spain 3%
Italy 3%
Japan 1%
France 1%
7
SOURCE: IMS Health (Average Expected Growth)
Local players gain market share
Value Volume
(R$) (Units)
Multinationals
2012 2013 2014 2015 2016 2017 2012 2013 2014 2015 2016 2017
8
SOURCE: IMS Health 2016
Low levels of per capita consumption
USA 8,745
Germany 4,811
France 4,288
Chile 1,577
Brazil 1,109
OECD 3,484
9
SOURCE: Organization for Economic Co-operation and Development (OECD), 2012
The largest market in Latin America
Mexico Argentina
9.7 bn
Locals are dominant and
3.8 bn focused in their markets
21% 8%
Brazil
24.3 bn
53%
Colombia
3.8 bn Absence of strong regional
8%
leaders
Chile
2.2 bn
5%
Others
2.3 bn
10
5%
SOURCE: Latin American Markets IMS Health (2014)
Fast ageing of population
Population 60+
(MM people)
90 35%
34%
80
29%
30%
74
70
24% 66
25%
CAGR
2.8%
60
20%
50
19% 54
40
42
15%
14%
30
1mm
10% 29 p.y.
10%
20
8%
20 5%
10
14
0 0%
10-19 45.4
20-29 58.6
30-39 71.4
4.4x
40-49 97.4
50-59 130.9
60-69 193.6
70+ 200.4
12
SOURCE: IBGE (Consumer Expenditure Survey 2008-09); Values readjusted by inflation (IPCA) to February 2018.
Retail pharma market
• Generics (API)
Pharmacist R$13.0B
• Similars
• RX with/without
Branded
prescription retention
55.0% Prescription Physicians R$31.3B
• OTX
• Dermocosmetics
13
SOURCE: IMS Health PPP Dec 2017 ,Market Size PPP LTM
High entry barriers
• Strict Regulator Fragmented Distribution Powerful Local Brands
• Continental country
(27 states; >200mm people)
• ~70k point of sales
• 28 larger chains 1960 2016
• ~230 distributors
• All generics are branded at
retail as in most of the World
(ex-US & Canada)
• Long approval
process (3-5 years)
• Strict control of
manufacturers,
products and
retailers
14
Retail pharma market
Pharma Retail
(% Sales) # Companies to reach 42% of market share
Smaller Retail
Chain & Larger
Independent Retail Chain
59% 41%
68.3 K POS 6.5 K POS
75 K Point of Sales *
(POS)
15 SOURCE: IMS Health World Review Conference 2017 (May 5, 2017; Dinâmicas e Perspectivas do Mercado Farmacêutico da
América Latina e do Brasil); IMS PMB-PPP February 2017; Hypera. Larger retail chains are the Abrafarma members.
Resilient growth
53.5 4.0
3.7
47.7 3.3
42.1 2.8
37.1 2.5
34.0 2.3
30.9 2.0
28.1
2011 2012 2013 2014 2015 2016 2017 2011 2012 2013 2014 2015 2016 2017
16
SOURCE: IMS Health – PMB-PPP (December 2017)
Agenda
Business Overview
Market Characteristics
17
Business overview
• Leverage on physicians
Branded visit network
Prescription* #5 4.6%
• Launch new products
Branded Consumer with untapped demand
Prescription Health
30% • Launch new product
41%
Consumer concepts through brand
Health #1 11.1% extensions
• Improve retail space
Branded
Generics • Increase market
29% presence, especially at
retails chains
Branded 12.3%
Generics
#2 • Improve portfolio
coverage especially at
high value products
18 * Excluding patents
SOURCE: IMS Health – PMB Dec 17; Hypera – 2017
Hypera strategic development
Cycle 3
Cycle 2
Cycle 1
19
Key objectives of strategic phases
20
Key objectives of strategic phases
21
Successfully executed business portfolio “churn”
Sale of
Cosmetics,
Condoms &
• Materially
Sale of
Home Care 41% Diapers improved
HPC 55% & Food capital
structure
100%
• Concentrated
on the most
59% attractive
Pharma 45%
Pharma
business
22
SOURCE: Hypera (Net Revenue breakdown)
Developed the best Go-to-Market platform
Most Productive
Lowest Cost • Most horizontal
Best Distribution
distribution
- Mom&Pops
- Regional
Marketing Distribution
- Chains
• Most productive • Largest field
sales force at physicians force at store level
• Lowest cost media buying (>70% direct access)
23
Brazilian peers
Hy permar cas
1.9
Player 1 EMS
2.9 1.5x
Player 2 Medley
3.0 1.6x
Player 3 Teuto
3.1 1.6x
Player 4 Aché
4.1 2.1x
24
SOURCE: Companies’ Financials 2016; IMS Health PMB – Units
Brazilian peers
Productivity
R$ MM/Rep per Year
1.9
Player 1 1.2
Player 2 0.9
Player 3 0.8
25
SOURCE: IMS Health – PMB-PPP Oct 16
Brazilian peers
EBIT Margin
Hy permar cas
32.5%
Aché
28.7%
EMS
15.8%
Eurofarma
14.1%
União Química
12.5%
26
SOURCE: Companies' Financials 2016.
Key objectives of strategic phases
27
Concentrated on most attractive Pharma business
High
Pharma
Business
Attractiveness Accelerate growth
Low High
Competitive Position
• #1 with leadership in many markets
• Diversified portfolio
28 • Most productive Go-to-Market platform
Diversified revenue base
(Branded Presc.)
8,3%
(Consumer Health)
6,0%
Other
products 4,1%
(Branded Generic)
Top 10
59,5%
4,0% (Consumer Brands:
Health)
3,7%
~40% sales
(Branded Presc.)
3,2% (Branded Presc.)
3,2%
2,8% (Branded Presc.)
2,7%
2,5% (Consumer Health)
(Branded Presc.)
(Consumer Health)
29
SOURCE: Company data, 2017
Diversified distribution
Fragmented distribution
Hypera reaches 100% of POS in Brazil
• Continental country
(27 states; 204mm people) Direct Indirect
Channel Transfer Channel
• 28 larger chains
Order
• ~230 distributors
Distributor
Hypera
Retailer
Warehouse
30% Distributor
36% 34%
30 75,300 Stores
SOURCE: Company Data, 2016 (Dec 17)
Large scale production facility
Aerosol
Efervecent
Solids/ Quality Liquids
Distribution Dermo
Raw Control Semisolids
Center
Materials Injectables
R&D
Solids Penicilin
Semisolids
Liquids
R&D
31
High production capacity
Tablets,
capsules,
Injectable and
coated tablets,
ophthalmic
pills and
effervescent 45 million
10 billion
Liquids,
creams, oils,
Aerosols ointments,
lotions and
11 million jellies
276 million
32
SOURCE: Hypera, per year
Segment the business in “Strategic Business Units” (SBUs)
• Brand portfolio
“Direct to • Merchandising #1
R$9.1 B
Consumer” capabilities 11.1% share
Consumer Health • Media Buying
• Product
innovation
“Medical #5
• Sales Force R$31.3 B
Community” 4.6% share
Branded Prescription Productivity
• Commercial
policy flexibility #2
“Trade” • “Fast copier” R$13.0 B
12.3% share
Branded Generics • Distribution
network
33
SOURCE: IMS PMB Dec 17
New organizational structure
Innovation Capabilities
• Offer opportunities based
on deep knowledge of
Innovation Center global technology
(Hynova) Business Development
• Efficient innovation process
and execution
34
Launch extensions of leading brands
CAGR
236 10.1% 128
CAGR
28.2% 82 111 21
74 CAGR 44
97
96
16.3% 27 19
63 17 17
40 183
37 172
22
8 23
39
150 192
84 88
79 80
42 150 164 159
39 41 37
2014 2015 2016 2017 2014 2015 2016 2017 2014 2015 2016 2017
Doril Doril Enxaqueca Benegrip Benegrip Multi Liquid Pills Gel Caps
35
SOURCE: IMS Health – PMB Dec 17
Expand to existing markets in Brazil
Covered Market
Coverage1 Share Ranking
Total Share Share covered
Consumer
40%
Health² 18% 27% #1
Branded
Prescription²
22% 5% 21% #1
Branded
Generics³
48% 13% 27% #1
37
38
Sell Out results 2017
Δ% 2017 vs 2016 Hypera Market “Spread”
Center for
R&D - Anápolis R&D - Hynova Pilot plant Consumer Studies
• State-of-the-art
equipment
Capacity
40 4 x higher
R&D Pharmaceuticals
Hynova - Barueri
41
R&D Dermo & Nutraceuticals
Types of products and technologies
Gels, Lotions and Séruns Sprays and Aerosols
Concept Product
Lab Validation Pilot Tests Dossier
Validation Design
18 to 30 months(1)
43
NOTE: (1) Excluding the period of prospecting and acquisition of materials and regulatory deadline
Business development pipeline
Co
2nd Brand License-in
Acquisition development
7 22 34 10
44 # projects
Current pipeline status
R&D Business Development
Projects Potential Revenue Projects Potential Revenue
Quantity R$ mm Quantity R$ mm
ANVISA ANVISA
Queue 31 301 Queue 10 235
Develop-
91 1,112 Contract 11 266
ment
Waiting
48 970 Negotiation 20 297
List
45
NOTE: (1) Potential revenue adjusted for risk and project phase
Relevance of strategic partnerships
# Projects
Gastro 14
CSN 13
OTC 11
Pain/Analgesics 11
Cardiology 8
Respiratory 6
Women's health 3
Dermatology 2
Anti-infectives 2
VMS 2
Ophthalmology 1
47
Increasing importance of innovation
28.0%
24.3%
23.0%
18.8%
17.2%
16.0%
48
SOURCE: Hypera Sell-in (% Net Revenues; products launched over the past 5 years) Dec 17
Innovation process
Approvers/Committee Process Leader
Idea Generation
Launch
Preparation Product Manager
and
Project Manager
Sell – in
CAGR
51.1% 2.3%
2.0% 84.4
65.4
1.4%
41.0
170 new
128
substances
(2010-14)
108
102
88 R&D
83 79
73
67
61 60 58
41
USA Germany Great Britain Italy Japan Spain Canada France South Korea Mexico Polonia Brazil
Availability in December/2015
52 NOTE: New molecules launched between 2010 and 2014. Availability of molecules in 2015.
SOURCE: IMS Institute for Healthcare Informatics, Dec 2015
Availability of new active substances by country
• Fixed dose
combinations
439 73% • Extended release
• Inhalation devices
• Transdermal patches
High potential • Nano-tech
for partnering 1,651
in innovative • Quick release
products 1,212 • Sub-lingual
• ODT
• Oral films
• Others
Late stage Yes No
development or
recently launched Presence in Brazil
products
53
SOURCE: Thomson Reuters (Cortellis) and Hypera
Growth source of Brazilian companies
3.0
-0.3
• Negative
14.6 performance of
11.9
legacy portfolio
• Growth comes
1 2 3
from new products
2012 Legacy New products 2015
54 NOTE: ¹ Adjusted by inflation. ² Considers products launched before 2008. ³ Considers products launched between 2008-2015
SOURCE: IMS Health - PMB Retail
Branded Prescription
• Drugs promoted to
Revenue Breakdown Products Physicians (OTC / RX)
Branded Consumer
• Intensify therapeutic
Strategy classes expansion
Prescription Health
41% 30%
55
Branded Prescription
Ranking
#1 10.0% 16.4%
#2 6.9% 15.3%
#3 6.2% 10.9%
#4 5.0% 8.0%
#5 4.6% 14.5%
56
SOURCE: IMS Health – PMB-PPP Dec 17
Branded Prescription
Productivity of medical reps team
Player 1 Aché
2,300 1.2
Player 2 Eurofarma
1,900 0.9
Player 3 NC - Farma
1,300 0.8
750 1.9
57
SOURCE: IMS Health – PMB-PPP Oct 16
Branded Prescription
Portfolio composition
Market Growth Growth
Relevance YoY Relevance YoY Therapeutic class examples
• Antibiotics
+12%
Acute • Analgesics
42% Acute +12%
48% • Anti-inflammatory
Chronic
• Antihypertensive
+12% • Antidepressants
Chronic Chronic
41% +18%
33% Skincare
• Photoprotection
Skincare • Moisturizing
Skincare
+8% 20% +15%
17% • Anti-aging
MARKET HYPERA
58
SOURCE: IMS Health – PMB Dec 17
Branded Prescription
Portfolio optimization by therapeutic classes
Gynecology 3% 55%
Cardiology 1% 78%
Psychiatry 1% 74%
Ophthalmics 1% 93%
59
SOURCE: IMS Health (Oct/2016); Hypera
Success case: Addera
169 175
72 122
36
36 29 29 30
2014 2015 2016 2017
Drops Pills Gel Caps
60
SOURCE: IMS Health – PMB Dec 17
Success case: Alivium
61
SOURCE : IMS Health – PMB Dec 17
Branded Prescription
2017 launches
New Concept:
Omega 3 in
pediatrics
Pain & Fever 2nd half 2017 Starting in Nutracosmetics
2nd half 2017 Market
2nd half 2017
62
Consumer Health
63
Consumer Health
Ranking
Sell-out
Growth
Ranking Company Market Share
YoY
#1 11.1% 10.1%
#2 10.9% 1.7%
#3 6.6% 8.0%
#4 4.8% 12.4%
#5 3.9% -0.1%
Total CH 9.5%
64
SOURCE: IMS Health – PMB-PPP Dec 17
Consumer Health
Business scope
Universe Characteristics
• Safe and well tolerated
• Simple dosages
Pharmaceuticals
• Fast relief of minor symptoms
Nutra- Dermo-
ceuticals cosmetics • Ease of access
• Good distribution
Nutri-
tionals
• Wide range of options
Food Cosmetics
• Affordable prices
Self Care
Communication POS
65
Consumer Health
Distribution
Convert Market Share in POS space via block Verticalization of the Sales & Merchandising
exposure of brands Teams
Specialist Team CH
Focus on execution
Resources Optimization
66
Increased distribution
Mercado Hypera
chains
16% Growth 23% Growth
67
SOURCE: IQVIA – PMB Sept’17
Category Management - 2017
Already implemented
Pilot stores
8 stores
9 stores
2 stores
68
Category Management - future
Roll-Out Drogasil
Roll-Out chains with pilot stores
Extrafarma Brasil
69
Underdeveloped markets in Brazil
Supplements
Probiotics
70
SOURCE: IMS PMB – Sept’17 – PPP / Mintel – Vitamins, Minerals and Suplements – US – Sept’ 17
Initiatives – OTC self-service exposure
Current situation
71 NOTE:(2) High / Very High> 30% POS Value; Average / Low / Very Low: <30% POS Value
SOURCES: Close Up Outlook 2017; Quintiles IMS World Review 2017
Initiatives – Increased media coverage: Globo package
72
SOURCE: Internal data
Consumer Health
2017 Launches
73
Branded Generics
74
Branded Generics
Outstanding position with solid evolution
#1 25.2% 10.8%
#2 12.3% 10.3%
#3 7.7% 17.2%
#4 7.5% 7.8%
#5 6.6% 23.9%
75
SOURCE: IMS Health – PMB - PPP Dec 17
Micro-Marketing: opportunities by region/channel
Market share in value/covered markets, Branded Generics and Generics
Region Channel
Highest growth
37.2%
2017: 31.8%
33.8%
South
28.5%
28.4%
26.5% 26.0%
20.2%
South Midwest Southeast Northeast North Large chains Mid-sized chains Independent
76
21.6%
19.6%
77
SOURCE: IMS Health - PMB Sept/17; Value = Average price of presentation
Opportunity to "modernize" the portfolio
Weight of the portfolio, in value
# of competitors
(Branded and Generics) Neo Química Profitability
1 2%
2–5 17%
6 – 10 25%
> 10 55%
78
SOURCE: IMS Health - IMS PMB Sep / 17
Key strategic initiatives – Branded Generics
79
Branded Generics
Leadership in main molecules
Similars Generics
Neosoro
Losartan
1st product 1st generics market
by units
Torsilax
4th biggest market
1st
3rd
Sildenafil
generics market
Doralgina Orlistat
5th OTC market 5th generics market
80
SOURCE: IMS Health - PMB
Branded Generics
Channel opportunities
Market
Relevance
33% 23%
Large
chains
81
SOURCE: IMS Health - ED
Branded Generics
Regional opportunities
Market Share
21.5%
17.5%
14.0% 14.4%
14.5%
9.3%
82
SOURCE: IMS Health – PMB-PPP LTM Jun/16
Branded Generics
Well-known brand with loyal consumers
AVG
Brand awareness and use leaders¹
Biggest “controlled drugs” market 2nd generic version of the market 2nd generic version of the market
Launched in 2016 Launched in 2016 Launched in 2016
Reference: Lexapro Reference: Selozok Reference: Lasix
2nd generic version of the market Line extension Biggest OTC-Similar market
1st half 2017 1st half 2017 Launched in 2017
Reference: Nebilet Reference: Sotacor Reference: Naldecon
84
Agenda
Business Overview
Market Characteristics
Our Business
Financials
85
Financial highlights
338 346
2014 2015 2016 2017 2014 2015 2016 2017 2014 2015 2016 2017
86
4Q17 Results
Depreciation and Amortization 19.0. 2.2% 18.8. 1.8% -0.8% -0.4 p.p.
Net Income (Continuing Op.) 212.3 . 24.2% 462.2. 44.8% 117.7% 20.6 p.p.
87
2017 Results
Net Income (Continuing Op.) 647.2. 20.0% 1,111.5. 30.5% 71.5% 10.5 p.p.
88
Net Debt Reduction
(R$ million)
3.9x
3.1x
3Q17
3T15 4Q17 2.9x
2.6x
Gross Debt (658.3) (676.0)
Cash 1,400.6 1,522.1 1.5x
Net Cash 742.3 846.1
-0.7x -0.7x
2011 2012 2013 2014 2015 2016 2017
89
Dividends & Capital Reduction 2017
R$1.95
R$ per share
30%
R$ 0.65 Dividends
R$ 0.50
R$ per share
R$0.92
CAGR
36%
42%
R$0.65
R$0.50
R$0.92
R$0.60²
R$0.50
91 NOTE: It considers the dividends paid in the respective periods; Dividend Yield calculated based on the average share price in the 12
months prior to payment.
ROE – Return on Equity
14.0%
7.2%
2016 2017
92 NOTE: ROE calculation is a result of the division of Continuing Operations Consolidated Net Income by the Consolidated Shareholders' Equity
quarterly average.
Company’s Main Tax Shields (1/4)
Expense for
R$ Million Tax Rate Cash Value* Origin
Tax only
- Acquisitions; Amortizable for tax purporses only
Goodwill 597 34% 203
- It does NOT impact the P&L, only the Cash Flow
Total 1,612
Possible analysis
impacts P/E EV/EBITDA Returns Cash flow Net income
93 Source: Hypera
¹ Federal tax credits are usable to pay any federal tax payment
Company’s Main Tax Shields (2/4)
Possible analysis
impacts P/E EV/EBITDA Returns Cash flow Net income
94
Source: Hypera
Company’s Main Tax Shields (3/4)
Possible analysis
impacts P/E EV/EBITDA Returns Cash flow Net income
95
Source: Hypera
Company’s Main Tax Shields (4/4)
Possible analysis
impacts P/E EV/EBITDA Returns Cash flow Net income
96
Source: Hypera; it includes continuing and discontinued operations
Ownership and listings
Free Float
Maiorem
65%
15%