wyeth citi investment research global healthcare conference
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Greg NordenSenior Vice President and Chief Financial Officer
May 21, 2008
2008 2008 Citi Citi Investment Research Investment Research Global Healthcare ConferenceGlobal Healthcare Conference
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Forward-Looking Statement
The statements in this presentation that are not historical facts are forward-looking statements based on current expectations of future events and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. These risks and uncertainties include risks associated with the inherent uncertainty of the timing and success of product research, development and commercialization (including with respect to the NDA filings for Wyeth’s pipeline products referenced in this presentation), drug pricing and payment for Wyeth’s products by government and third-party payers, manufacturing, data generated on the safety and efficacy of Wyeth’s products, the impact of competitive or generic products, trade buying patterns, global business operations, product liability and other types of litigation, the impact of legislation and regulatory compliance, intellectual property rights, strategic relationships with third parties, environmental liabilities, and other risks and uncertainties, including those detailed from time to time in Wyeth’s periodic reports filed with the Securities and Exchange Commission, including Wyeth’s current reports on Form 8-K, quarterly reports on Form 10-Q and annual reports on Form 10-K, particularly the discussion in Wyeth’s annual report on Form 10-K under the caption "Item 1A, Risk Factors." Wyeth assumes no obligation to publicly update any forward-looking statements, whether as a result of new information, future developments or otherwise.
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2008 Guidance*
n Pro Forma EPS $3.35 to $3.49 (-1% to -5%) n Revenue Comparable to 2007n Gross Margin 72% to 74%n SG&A Down 2% (Excluding Any Impact from Foreign
Exchange)n R&D Up Slightlyn Tax Rate 29% to 31%
* Excludes Certain Significant Items
Taking Aggressive Measures to Mitigate the Impact of the Loss of Protonix to the Extent Possible
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$0
$1
$2
$3
$4
$5
$6
1Q07 1Q08$0.0
$0.5
$1.0
$1.5
$2.0
1Q07 1Q08$0.00
$0.50
$1.00
1Q07 1Q08
$5.4B$5.4B
$5.7B$5.7B
$1.7B$1.7B
$1.8B$1.8B
$.94$.94
$.94$.94
+6% +7% +0%
Net Revenue ($B) Operating Profit ($B) Earnings Per Share*
Wyeth 1Q 2008: Solid Performance Despite Impact from “At-Risk” Generic Protonix Launches
* As Adjusted, Before Certain Significant Items
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Results by Division: 1Q 2008
Animal Health$276.6M
ConsumerHealthcare
$675.2M
Pharmaceuticals$4,758.8M
Worldwide Net Revenue Increased 6% to $5.7 Billion for the 2008 First Quarter
0%*0%*
6%*6%*
* Represents percentage increase in 2008 First Quarter Net Revenue compared with 2007 1Q
10%*10%*
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19%
$411M$342M
$1,021M
15%
Represents 2008 First Quarter Net Revenue and percentage increase (decrease) compared with 2007 1Q; amounts presented for Enbrel represent Net Revenue outside the U.S. and Canada,where Wyeth has exclusive rights
$706M
14%
Key Product Performance: 1Q 2008
$159M
(66)%
22%
$606M
36%
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Wyeth Pharmaceutical Success Imperatives
Drive Growth in Products and Regions
Successfully Introduce New Products
Sharpen Focus - Manage Costs – Define Path
1.
2.
3.
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Wyeth Pharmaceutical Success Imperatives
Drive Growth in Products and Regions
Successfully Introduce New Products
Sharpen Focus - Manage Costs – Define Path
1.
2.
3.
9
2007 Revenue: $2.4 Billion (+24%) Expect Mid-Teens Growth in 2008
Focus On Growth Drivers:
®®
Strong and Growing Product Lines
2007 Revenue: $2 Billion Int’l. (+36%) International Revenue Expected to Exceed $2.5 Billion in 2008 … $3 Billion Target in 2010
2007 Revenue: $1.4 Billion (+20%)Expect 2008 Growth to Be Similar to Last Year
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2007 Revenue: $3.8 Billion (+2%)Expect 2008 Sales to Be Comparable to 2007
Focus On Growth Drivers:
Strong Contributors to Revenue
2007 Revenue: $1.1 Billion (+17%)Expect International Generic Competition and Possible Generic Competition in the U.S.
2007 Revenue: $1.1 Billion (+0%)Progress Continues in Clarifying the Benefit/Risk Profile of Hormone Therapy
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2007 Revenue: $705 Million (+7%)
Focus On Growth Drivers:
Strong Contributors to Revenue
2007 Revenue: $684 Million (+10%)
2007 Revenue: $1,042 Million (+11%)
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Hemophilia Franchise Grew 16% in 2007Franchise Is on Track to Reach $1B in 2009
Focus On Growth Drivers:
Other Solid Contributors to Revenue
2007 Revenue: $359 Million (+17%)
2007 Revenue: $365 Million (+8%)
BMP-2
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Drive Growth in Regions
2000 2007
US EMEA/C APAC LA
Revenue 61%10%
5%
24%31%
6%12%
52%
$13.1B $22.5B
Wyeth’s Growing International Presence Evolution of Sales
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Increasing Contribution & Accelerating Growth In Emerging Markets for Pharma Industry
2007 IMS Health (Rx Market), Russia sales based on 3Q MAT 2007.MENA Countries include: IMS data for Saudi Arabia, S. Africa, UAE, Kuwait. The value is under-represented given several countries are not included in the audit.
Western EuropeWestern Europe$167B$167B+6%+6%
Japan$58B+5%
North AmericaNorth America$295B$295B+4%+4%
Select Emerging Markets
$62B+16%
China$14B+26%
India$7B
+13%
Brazil$8B
+10%
Russia$5B
+19%
Korea$8B
+14%
Korea$8B
+14%
Turkey/MENA$13B+16%
Mexico$7B+8%
ROW$31B +11%
2007 Global Rx Market: $612B (+6%)
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One Example of Wyeth’s Expansion Into Accelerated Growth Markets
Before Expansion 2008 Coverage
4545COVERED COVERED
CITIESCITIES
180180COVERED COVERED
CITIESCITIES
Currently Covered City City Expansion
Wyeth Nutritionals - Geographic Expansion in China
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Wyeth Pharmaceutical Success Imperatives
Drive Growth in Products and Regions
Successfully Introduce New Products
Sharpen Focus - Manage Costs – Define Path
1.
2.
3.
17
cSSSI and cIAICommunity Acquired Pneumonia
Renal Cell Carcinoma
Opioid Induced Constipation
Successfully Introduce New Products Continued and Projected 2008 Launches
Hemophilia A
Depression
Flea and Tick Protection for Dogs and Flea Protection for Cats
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The Wyeth Development Pipeline Continues to Grow in Breadth, Depth and Innovation
GSI-136NSA-789BLI-489MMS-255HSD-016PDE-551ILS-920NRI-992ACC-002Staph AureusBLD-089AAB-002SBI-087 TRU-015 -Lupus
ILV-095RAS-111BMP-655BMP-2 –Fracture Prevent
ATR-107
PAZ-417AGG-523SRA-444HKI-357GAP-134PRA-027MnB - InfantILV-094 – RAILV-094 -
PsoriasisTRU-015 –Onc.AAB-001 – SCIMA-026
HCV-796SAM-531Relistor™ - Oral(Methlynaltrexone)
MoxidectinBosutinib - Breast
(SKI-606)Vabicaserin
(SCA-136)Neratinib - Breast
(HKI-272)Tygacil® - HAPMnB – AdolescentACC-001TRU-015 - RAAnrukinzumab
(IMA-638)BMP-2 Inject.
Lybrel® -Contraception (EU)
Pristiq™ - MDD (EU)Viviant™ - Osteo.
Prev. &Treat.Pristiq™ - VMSTygacil® - CAPTorisel® - MCL (EU)ReFacto® AF (EU)
Small MoleculesVaccinesProteins
Aprela™ - Osteo. & Vaso. Symptoms
Tygacil® - Diabetic Foot Ulcer
Bosutinib - CML (SKI-606)
Pristiq™ -Fibromyalgia
Pristiq™ -Neuropathic Pain
Relistor™ - IV - POI(Methylnaltrexone)
Lybrel® - PMDDProtonix® - Oral PedRapamune® - Liver13vPnC - Infant13vPnC - AdultBapineuzumab - ADInotuzumab - NHL(CMC-544)
Phase 0 Phase 1 Phase 2 Phase 3 Registration
Phase 019
Phase 112
Phase 213
Phase 313
Registration8
May 2008
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Prevnar 13v – Expanding the Coverage
• Phase 2 Proof of Concept Achieved
• Licensing Criteria Agreed Upon
• Worldwide Phase 3 Studies Ongoing
• Submission Early 2009
StatusStatus
Infant
> $3 BillionPeak SalesPeak Sales
• Provide BroadestCoverage Available for the Global Protection of Children Against Pneumococcal Disease
OpportunityOpportunity
• Proof of Concept Achieved
• Licensing Criteria Agreed Upon
• Worldwide Phase 3 Studies Ongoing
• Submission Early 2010
Adult
> $1.5 Billion
• Provide First and Only Conjugate Vaccine That Offers Adults, >50, an Opportunity to Prevent Pneumococcal Pneumonia for the Rest of Their Lives
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BapineuzumabPhase 3 for Alzheimer’s Disease
n Four Studies in Over 4,000 Patients Are Beginning Worldwide
First U.S. Patient Enrolled December 2007; International Studies to Initiate May 2008
n Co-Primary Efficacy Endpoints – Validated Cognitive and Functional Scales
Other Cognitive, Functional, Behavioral, Biomarkers, Health Outcomes Endpoints
n Phase 2 Data Mid-2008Top Line Press ReleaseFull Data at ICAD in July
21
Wyeth Pharmaceutical Success Imperatives
Drive Growth in Products and Regions
Successfully Introduce New Products
Sharpen Focus - Manage Costs – Define Path
1.
2.
3.
22
Project Impact: Focus and Sequence
20082008 20092009 2010+2010+
Level I:Level I: Cost ReductionCost Reduction
• Reduce/Eliminate Costs and Expense
Level I: Cost ReductionLevel I: Cost Reduction
Level II:Level II: Business Model & StructureBusiness Model & Structure
• Change How We Operate and Improve Performance Within Current Business Model and Structure
Level II: Business Model & Structure RefinementLevel II: Business Model & Structure Refinement
Level III:Level III: PharmaPharma Strategic DirectionStrategic Direction
• Change Our Business/Operating Model for the Future
Level III: Level III: PharmaPharma Strategic RedesignStrategic Redesign
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Project Impact: Functional Teams
n Offshoring and Outsourcingn Site Network and Spend Optimizationn Operational Efficiencies (Grants, etc.)n Alternative Investment Modeln Portfolio Optimization
Research and Pre-ClinicalClinical, Medical and Regulatory
n Global/Regional/Local/Business Unitn Affiliate Structure n Sales Operating Modeln Spend Effectiveness
Commercial
n Site Networkn Productivity and Performancen Process Excellence
Manufacturing and Supply
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Project Impact: Cross-Functional Teams
Infrastructure/ Support
Purchased goods and Services
Information Services
n Therapeutic/Disease Areasn Portfolio/Pipeline Mixn Specialty/Primary Care Mix
Strategic Direction
n Support Function Modelsn Demand Managementn Vendor Consolidationn Goods and Services Pricingn Facilities/Real Estate Review
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Key Financial Metrics
n Net Cash (Including Diet Drug Security Funds) = $2.8 Billion
Cash and Cash Equivalents at 3/31/08 = $14.5 BillionTotal Debt at 3/31/08 = $11.7 Billion
n Uses of CashMergers and Acquisitions/In-LicensingShare RepurchasesDividendsRepayment of Debt
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Wyeth: Positioning Itself for Future Growth
n Diversified by BusinessPrescription, Consumer, Animal Health
n Primary Product Engines Continue to Offer Growth Opportunities Enbrel, Prevnar, Nutritionals
n New Product Launches Contributing to Revenue Growthn Proven Capability in Three R&D Platforms and Proven Ability to
Successfully Commercialize Biotech, Vaccine and Small Molecules
n Pipeline Offers Range of Options Including Both Near-Term and Blockbuster Candidates
n Positioned to Take Advantage of Global Growth Opportunities
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