PROTEK GROUP A LEADER IN RUSSIAN PHARMACEUTICAL MARKET Moscow 2010 - - PowerPoint PPT Presentation

protek group a leader in russian pharmaceutical market
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PROTEK GROUP A LEADER IN RUSSIAN PHARMACEUTICAL MARKET Moscow 2010 - - PowerPoint PPT Presentation

PROTEK GROUP A LEADER IN RUSSIAN PHARMACEUTICAL MARKET Moscow 2010 www.protek-group.ru IMPORTANT NOTICE (Disclaimer) Matters discussed in this presentation may constitute forward-looking statements. Forward-looking statements include


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SLIDE 1

PROTEK GROUP A LEADER IN RUSSIAN PHARMACEUTICAL MARKET

www.protek-group.ru

Moscow 2010

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SLIDE 2

2

IMPORTANT NOTICE (Disclaimer)

www.protek-group.ru

Matters discussed in this presentation may constitute forward-looking

  • statements. Forward-looking

statements include statements concerning plans, objectives, goals, strategies, future events

  • r

performance, and underlying assumptions and

  • ther

statements, which are

  • ther

than statements

  • f

historical

  • facts. The

words “believe”, “expect”, “anticipate”, “intends”, “plan”, “estimate”, “aim”, “forecast”, “project”, “will”, “may”, “might”, “should”, “could” and similar expressions (or their negative) identify certain

  • f

these forward-looking

  • statements. Forward-looking

statements include statements regarding: strategies, outlook and growth prospects; future plans and potential for future growth; liquidity, capital resources and capital expenditures; growth in demand for products; economic

  • utlook

and industry trends; developments

  • f

markets; the impact

  • f

regulatory initiatives; and the strength

  • f

competitors. The forward-looking statements in this presentation are based upon various assumptions, many

  • f

which are based, in turn, upon further assumptions, including without limitation, management’s examination

  • f

historical

  • perating

trends, data contained in the Company’s records and

  • ther

data available from third

  • parties. These

assumptions are inherently subject to significant uncertainties and contingencies which are difficult

  • r

impossible to predict and are beyond the Company’s control and it may not achieve

  • r

accomplish these expectations, beliefs

  • r
  • projections. In

addition, important factors that,inthe view

  • f

the Company, could cause actual results to differ materially from those discussed in the forward-looking statements include the achievement

  • f

the anticipated levels

  • f

profitability, growth, cost and its recent acquisitions, the timely development

  • f

new projects, the impact

  • f

competitive pricing, the ability to

  • btain

necessary regulatory approvals, and the impact

  • f

general business and global economic

  • conditions. Past

performance should not be taken as an indication

  • r

guarantee

  • f

future results, and no representation

  • r

warranty, express

  • r

implied, is made regarding future performance.

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PROTEK Group is one of the largest vertically integrated holding

  • perating on the

Russian pharmaceutical market. The Group has a diversified business structure embracing each of the principal industry sectors, including the production of medications, wholesale distribution of pharmaceutical and beauty products, and retail sales. In 2009, the Group’s consolidated revenue amounted to RUR 91,581 mln*, showing growth YoY by 18.1 %. The ability to provide a wide range of services, from joint production to retail sales of health and beauty products, constitutes the main competitive advantage of the Protek Group.

ABOUT PROTEK

Source: audited IFRS statements

www.protek-group.ru

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ORGANIZATIONAL STRUCTURE

Parent company – OAO PROTEK Production Sotex Protein Contour Protek-SVM Distribution CV PROTEK Transservice Spargo Technologies Promofarm Retail Sales Rigla pharmacy chains

www.protek-group.ru

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SLIDE 5

2008 revenues, RUR, million*

Parameters Distribution

2009 revenues, RUR, million* Revenue growth, 2009 / 2008

* Source: audited IFRS statements

KEY FINANCIALS BY SEGMENTS

69,256 20.1 % 83,121 Production 2,938 18.6 % 3,484 Retail Sales 10,311 9.2% 11,256

www.protek-group.ru

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HISTORY OF THE GROUP

Company is established. Start of wholesale distribution business Launch of specialist pharmaceutical distribution

  • perations

First distribution agreement with Gedeon Richter Launch of pharmaceutical production Launch of retail business Establishment of an integrated management structure Active M&A growth in retail Acquisition of O3 chain Acquisition of Protein Contour, an R&D platform Start of production

  • f own branded

medications Commissioning of one of Europe’s largest pharmaceutical warehouse Construction of GMP compliant plant,

  • perated by Sotex

Distribution Retail Production Group

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 www.protek-group.ru

Group

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50 % 20 % 30 %

Results of the IPO-2010

114,285,714 (20.2%) $ 400,000,000.- $ 3.50 $ 1.85 bln. Offer stock Offered price Capitalisation Raised funds, total Underwriters: Renaissance Capital and UBS Investment Bank Exchanges: RTS, MICEX Traded since: April 27, 2010

The Group IPO proceeds

Retail Distribution, Group Production

Source: Company data

www.protek-group.ru

Offer structure split 50%/50%

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SLIDE 8

1.1% 1.1% 1.2% 1.5% 1.7% 1.8% 2.2% 2.8% 4.1% 1.0% 2.4% 2.8% 3.0% 3.0% 3.1% 3.1% 3.7% 6.0% 20.5% 2.0%

8

Other 81.5% 18.5%

Top 5 market share: 36.4%

STRONG MARKET POSITION ACROSS ALL BUSINESS SEGMENTS

Source: Pharmexpert preliminary data for 2009, by sales volume Source: DSM annual market report, 2009, by sales value Source: DSM annual market report, 2009, by sales value Note: Rigla market share represents the total market share of the Protek Retail segment

Distribution, 2009 Retail Sales, 2009 Top 5 market share: 12.6% #2 player in Russia Production, 2009 #4 player in Russia Top 5 market share: 82.0% #1 player in Russia

Other 50.4% 49.6%

CV Protek 22.2% SIA Intl 21.9% Katren 15.7% Rosta 13.2% Alliance Healthcare 9.0% Other 18.0%

36.6 Rigla (Protek) Pharmakor Implozia Raduga Stolichnye apteki Vita Doktor Stoletov Stary Lekar Pervaya Pomosch Pharmstandard Stada Valenta Sotex (Protek) Veropharm Biotek Polpharma Farm-centre Microgen Krasnogorsklek arstva

www.protek-group.ru

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WIDE NATIONAL COVERAGE PRESENCE IN ALL 83 REGIONS OF RUSSIA

Source: Source: Company data, at the end of 2009, сities with turnover above US$1mln are reflected as of 31 December 2009. 1

  • Incl. 56 Zhivika pharmacies, owned by LLC AS-Buro Plus, in which the Company has a 25% stake and has an option to acquire additional 26%

2 Certified for GMP compliance by Nycomed (in relation to the licensed production of Actovegin)

  • St. Petersburg

Aggregate warehouse area ~ ca.168,000 sq. m (~70% is owned) Presence in all 83 regions of Russia 577 pharmacies in 25 regions of Russia and in Ukraine1 DISTRIBUTION RETAIL PRODUCTION

Warehouses

  • Rep. offices

MOSCOW

Production facilities Protek pharmacies present

  • GMP compliant facility

with annual production capacity of up to 100 mln ampoules/ 6 mln syringes/ 35 mln packs2 a year www.protek-group.ru

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WHOLESALE DISTRIBUTION KEY INDICATORS

Commercial State / Budget (incl. DLO)

Revenue breakdown by principal customer groups

Commercial (Protek retail)

28% 22% 21% 67% 72% 72% 2007 2008 2009 5% 6% 7% 27% 22% 21% 69% 72% 72% 2007 2008 2009 4% 6% 7%

Distribution Logistics services Customs integrated clearance Marketing Information (promotion) IT services Storage services and warehouse leasing

Excellence in value added services

Source: Company data, at the end of 2009

58,041 69,256 83,121 2007 2008 2009

Total revenue dynamics

1 9 . 3 % 2 . % Total revenue, RUR mln

www.protek-group.ru * Source: audited IFRS statements

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RETAIL PHARMACEUTICAL SALES RIGLA

  • Second largest pharmacy chain in Russia by revenue
  • 577

pharmacies* as at 31/12/2009

  • 25

Russian regions covered plus a chain in Ukraine

  • RUR 290 -

average purchase transaction

  • RUR 716 -

average purchase by loyalty cards

  • Some

670,000 loyalty cards by the end of 2009

  • Some 11,000 product types
  • About 30 % of the product range is accounted for by para-pharmaceuticals
  • More than 70 %
  • f the product range is supplied internally (by CV Protek)

* 56 Zhivika pharmacies, owned by LLC AS-Buro Plus, in which the Company has a 25% stake and has an option to acquire additional 26% Source: Company data, at the end of 2009

www.protek-group.ru

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SLIDE 12

RETAIL SALES KEY INDICATORS

Source: Company data, at the end of 2009 * Owned by LLC AS-Buro Plus, in which the Company has a 25% stake

Second largest pharmacy business in Russia

577*

Total revenue dynamics

72.1% 9.2%

2 25 85 152 206 275 413 534 521 56 2001 2002 2003 2004 2005 2006 2007 2008 2009

Protek retail pharmacies Zhivika pharmacies* 5,990 10,311 11,256 2007 2008 2009 Total revenue, RUR mln

www.protek-group.ru

* Source: audited IFRS statements

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  • Certified as per ЕU

GMP standards*

  • Ampoule production with capacity of 100 mln

ampoules and 6 mln syringes a year

  • Bio-similar product pre-filled syringes manufacturing
  • Strong R&D platform: LLC Protein Contour (acquired in 2008)
  • Product portfolio: 80 products, incl. 15 own brands
  • Annual technical audit of the plant by global pharmaceutical manufacturers
  • Own brands production: Eralfon

(13.6% market share), Amelotex, Angiosil retard, Cereton

PRODUCTION SEGMENT SOTEX

Key Products

Source: Company data, at the end of 2009 * Certified for GMP compliance by Nycomed (in relation to the licensed production of Actovegin)

www.protek-group.ru

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PRODUCTION SALES KEY INDICATORS

Total revenue dynamics

19.8% 18.6%

Revenue breakdown (RUB mln)

Increasing share of own brands is the primary profitability driver

50% 64% 70% 37% 32% 29% 11% 4%

2%

1% 2007 2008 2009 2,453 2,938 3,484 Licensed generics Non-branded generics and substances Sotex brands Other

Source: Company data, at the end of 2009

2,453 2,938 3,484 2007 2008 2009 Total revenue, RUR mln

www.protek-group.ru

*Source: audited IFRS statements

RUR mln

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PRODUCTION PARTNERS

Source: Company data, at the end of 2009

www.protek-group.ru

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PROTEK GROUP STRATEGY

1 Increase market share 2 Strengthen the integration of our operations and leverage the synergies between our business segments 3 Improve cost efficiencies of our integrated operations, with focus on cost reduction in order to enhance profitability 5 Exploit opportunities from government healthcare expenditure as they arise 4 Pursue strategic acquisitions in our retail and production businesses

www.protek-group.ru

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Production-Distribution-Retail distribution channel Joint promotion programs Enhanced product quality control Information flow between companies of the Group Integrated logistics infrastructure for all segments Integrated IT systems Uniform management, planning and reporting standards

SIGNIFICANT COMPETITIVE ADVANTAGES DERIVED FROM VERTICAL INTEGRATION

DISTRIBUTION RETAIL PRODUCTION

www.protek-group.ru

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DEFENSIVE SECTOR OF CONSUMER MARKET WITH ATTRACTIVE GROUTH DYNAMICS

Performance of various sectors in Russia, 2008-2009, YoY, in RUR terms Estimated growth of pharmaceutical markets, CAGR 2008-2013, in US$ terms

Source: IMS Health Consulting 2009 Source: DSM annual market report, 2009

One of the fastest growing pharmaceutical markets in the world Strong performance of the sector in the crisis period

1 1 2 2 4 4 6 7 8 9 13 13 13 22 5 10 15 20 25 USA France UK Italy Japan Germany Canada Mexico Spain Brazil

  • S. Korea

Turkey India Russia China (%)

  • 49%
  • 19%
  • 16%
  • 15%
  • 8%
  • 8%
  • 6%
  • 2%

11% 18% Auto retail Mobile phones retail Construction Hotels, restaurants Retail GDP Utilities Agriculture Food retail Pharmaceutical market

www.protek-group.ru

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THANK YOU!

Telefax +7(495) 730-78-28 Address 2, Chermyanskaya, Moscow 127282 e-mail info@protek-group.ru web www.protek-group.ru

www.protek-group.ru