Boehringer pursues aggressive new products strategy
Boehringer Ingelheim announces flat growth for 2013 and anticipates a tough 2014, but pins future growth on aggressive R&D investment delivering more than 10 new product launches by 2016, to reduce dependence on the established portfolio.
The management of the family-owned pharmaceutical company has presented results from a challenging 2013, and outlined how it is gearing up to reduce its dependence on established products by 2018.
At its annual press conference on Tuesday, the firm presented flat net sales of 14.1bn Euros in 2013, up only 1.4% from 2012 in currency-adjusted terms. Despite Chairman Andreas Barner describing 2013 as a "difficult year" for the company, it managed to increase operating income to 2.1bn Euros, up 15%, bring total financial funds up to 7.5bn Euros and increase the equity ratio to 39%, up from 36% in 2012 to solidify its position.
Prescription medicines remained the key sales driver for Boehringer in 2013, accounting for 10.9bn Euros sales, with leading products Spiriva, Micardis and Pradaxa cumulatively delivering over 6bn Euros.
Oral anticoagulant Pradaxa continued to be one of the firm's strongest performers, its 2013 sales of 1.2bn Euros represented an increase of 16% over 2012. However the company is facing thousands of lawsuits in the US claiming the drug caused severe or fatal bleeding in patients.
Commenting on the legal challenges to Pradaxa, Barner commented that he was "convinced the company had acted correctly" and this would come out in the final analysis.
Moving forward, Boehringer is pinning future growth hopes on an aggressive new product launch strategy, with more than 10 launches planned by 2016. This will increase the share of overall revenues in 2018 from new products - up to 56% from its current much lower level of 16%. The firm has over 90 R&D projects in its pipeline, and expects to see nine new compounds in phase II trials in 2014, and is particularly focussed on expanding its presence in the CNS and immunology space.
The management board also took time to outline how the environment for research-based pharmaceuticals in Germany was proving particularly challenging, with Barner describing the local pricing and market access environment as more "unpredictable" than other European countries, although there was no suggestion of a move away from its home market. But with sales from Germany accounting for 7% of total revenues and exchange rate fluctuations impacting the contribution from its other major markets of the US and Japan, the company also anticipates a tough 2014.
In addition to heavy investment in R&D, the board outlined other opportunity areas such as contract manufacturing for biosimilars and collaborative initiatives focussed on companion diagnostics, 'beyond the pill' patient support (e.g. the Respimat training app) and optogenetics / epigenetics.
Despite this challenging environment, Barner pointed out that Boehringer Ingelheim outperformed the average growth rate for leading pharma companies and reiterated the company's approach to sustainable organic growth, rather than aggressive acquisition.
Links
Pradaxa gains new US blood clot approval
Tunnah’s musings: Social media in the pharma boardroom
