Investor presentation November 2018 - BioGaia
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Investor presentation November 2018
The founders Peter Rothschild and Jan Annwall
BioGaia in short
Founded in 1990 127 employees
Listed on the Nasdaq Holds 440 patents
Stockholm (mid cap list) in 32 families
Products in 100 markets Offices in Sweden
through distributors (Stockholm, Lund, Eslöv),
Singapore, USA, Japan
2
A healthcare company working with probiotics
MISSION VISION
BioGaia conducts research BioGaia’s vision is to be a
and development to offer ground-breaking leader in
consumers clinically-proven, probiotics
health-promoting, patented
and user-friendly probiotic
products
NETWORK
Researchers
Preclinical and clinical
Flexible business model studies at hospitals
and universities
BioGaia
Product development
Product strategies
Research
Quality assurance system
Marketing support
IP
NETWORK NETWORK
Partners Suppliers
Pharmaceutical or Production and
healthcare companies packaging
with sales
organizations
BioGaia
Universities and hospitals
where research is conducted
Manufacturing and
packaging units
Partners with sales
of products
4
BioGaia’s partner network
PARTNERSHIP WITH STRONG LOCAL
DISTRIBUTORS
DIETARY BIOGAIA
SUPPLEMENT BRAND
SALES THROUGH
PHARMACIES
BioGaia brand
• Branding for Health professionals
• Sold in 70 countries
• 69% of sales of finished consumer products (drops, digestive health tablets, oral health
tablets, oral rehydration solution) were sold under the BioGaia brand, including co-
branding, in 2017
• Build value, less dependence on patents
Protectis Protectis Gastrus Prodentis
BioGaia’s Intellectual Property
440 Trademarks in
70
issued
patents in
66 Internet-
countries + EU domains
32 families
7
Clinical trials supporting the use
of BioGaia probiotics
184
clinical studies have been carried out to
date, including 12 in 2017. Results have
been published in 159 articles in
scientific journals and 14 doctorial
theses (March 2018).
15 500
individuals of all ages have taken part in
clinical studies with BioGaia’s human
strains of Lactobacillus reuteri
Clinical trials with BioGaia Probiotics in different age groups
184 completed clinical trials (50% children) in 15,500 individuals (68% children)
Infants (0-12 mo*) Children (3-18 y)
32 studies in 31 studies in
3 109 subjects 2 786 subjects
Preterms Children (13-36 mo) Adults (>18 y)
16 studies in 17 studies in 88 studies in
2 821 subjects 2 039 subjects 4 521 subjects
Updated
9 March 2018
BioGaia probiotics and indications
Protectis
Functional gastrointestinal Colic
disorders
Regurgitation
Acute gastroenteritis
Constipation
Protectis
Support of gastrointestinal Functional abdominal
health pain
Antibiotic-associated side-
effects
Gastrus
Eradication treatment
associated side-effects
HP-infection
Prodentis
Gingivitis
Periodontitis
10THE BIOGAIA GROUP
11BioGaia Group
THE MICROBIOME PARTNER
BioGaia Group
BioGaia AB
BioGaia BioGaia BioGaia BioGaia CapAble AB MetaboGen AB
Biologics Inc. Japan Inc. Pharma AB Production AB
12• BioGaia Pharma AB is a subsidiary to BioGaia AB applying 25 years of probiotic experience to the research and development of new microbial therapeutic platforms. • Through an established network of research institutions and companies, BioGaia Pharma’s mission is to match early research on candidates from the microbiome with unmet medical needs to develop drug platforms. • Formed: June 2017 • Location: Stockholm, Sweden • www.biogaiapharma.com • Areas of focus: infectious diseases; inflammatory and gastrointestinal disorders
Development of next generation probiotics
• MetaboGen works to develop products from novel bacterial strains, targeted for precise
indications and derived from the human gut microbiome
• Products may be food supplements, or drugs, depending on the indication and the
preference of future partners
• MetaboGen provides BioGaia with access to front-line development of next generation
microbial products, including regulatory development in this emerging field
DISCOVERY, FINDING FULL METAGENOME STRAIN PRODUCT CLINICAL TRIAL
FUNCTIONAL RELATIONSHIPS ANALYSIS IDENTIFICATION DEVELOPMENT REGULATORY WORK
MARKETING
Jens Nielsen
Systems Biology
R&D
Fredrik Bäckhed
Metabolic disease
R&D
Performed in MetaboGen, including
unique technology for producing products of anaerobic strains Together with partners• Production of BioGaia drops, easydropper, MiniPack and samples
• GMP pharma certified
• Product development
• Laboratory
GMP certified BioGaia Production BioGaia Production 15• Providing innovative packaging solutions allowing the development of new
unique beverages
• Exclusive LifeTop™ Cap and LifeTop™ Straw supplier
• www.lifetop.eu
LifeTop™ Cap LifeTop™ StrawA Foundation against
Antibiotic Resistance
A BioGaia CSR initiative that supports research and
education within the area of antibiotic resistance by:
Giving financial support to research and
education that helps to prevent infections which
reduces the use of antibiotics and the risk of
antibiotic resistance.
Activities
• Twitter account (@ResResistance)
• Monthly newsletter – Resist the resistance
• Meetings with companies, organizations,
politicians to influence decision makers
• Articles in regional newspapers and appearances
by BioGaia representatives in media
17MARKET AND
COMPETITORS
18Our Market: Global probiotic supplement market 2015 ($ 3.8 billion)
0,1
0,6
1,9
1,2
America EU Asia Pacific Rest of world
International Probiotics Association 2015, Euromonitor International 2015
19Our Market: Global probiotic supplement sales
(Sales 2015 projected to 2020)
6
5,4
5
4 3,8
3 2,6
2
1
0
2010 2015 2020
Sales ($ in billion)
From 2015 to 2020, CAGR of 7,4% assumed according report from Global Market Insight
International Probiotics Association 2013 & 2015, Global Market Insights 2016
20What defines a probiotic supplement leader?
High quality & Innovative Consumer
competitively dosage and HCP Distribution
Strong IP priced culture formats loyalty channels
Fermen- Manu- B2B Brand B2C
R&D
tation facturing marketing owner marketing
21The BioGaia benchmark
Fermen- Manu- B2B Brand B2C
R&D
tation facturing marketing owner marketing
• BioGaia IP, R&D and Product Development have enabled development of the
BioGaia pediatric brand with unrivaled global distribution channels
• BioGaia has decided not have in-house fermentation manufacturing
• BioGaia has focused less on B2C marketingBioGaia Competitors
• Companies developing, producing, and selling probiotics (Chr. Hansen)
• Well studied probiotic strains (L.GG from Valio)
• Non probiotic products / drugs (Imodium, Simethicone)
• Probiotic products with strong brands (Enterogermina)
• Pharma companies (Sanofi)
• Functional Food (ProViva)
23Importance of strain specificity
Probiotic bacteria Car
Group Lactic acid bacteria German car
Genus Lactobacillus Volkswagen
Species Lactobacillus reuteri VW Golf
Strain L. reuteri Protectis VW Golf 2.0 Turbo
Different breeds have different characteristics
and are suitable for different tasks
VW Golf I and the VW Golf VI GTI, similar cars, but you do not expect the same output
Try convincing your teenage daughter that an
iPhone 3 is just as good as an iPhone 6
24MAJOR SHAREHOLDERS
AND BOARD OF
DIRECTORS
25Major Shareholders 30 September, 2018
(source: Euroclear)
Share No. of
A shares B shares capital votes Capital Votes
000's 000's SEK 000's 000's % %
1 Annwall & Rothschild Inv. AB 741 509 1,250 7,916 7.2% 33.0%
2 Swedbank Robur fonder 1,632 1,632 1,632 9.4% 6.8%
3 Fjärde AP-fonden 1,316 1,316 1,316 7.6% 5.5%
4 Öhman Bank S.A 1,177 1,177 1,177 6.8% 4.9%
5 State Street Bank & Trust co 742 742 742 4.3% 3.1%
6 David Dangoor 519 519 519 3.0% 2.2%
7 BNY Mellon SA/NV 490 490 490 2.8% 2.0%
8 Banque Pictet &CiE 459 459 459 2.6% 1.9%
9 SSB and Trust company, Boston 413 413 413 2.4% 1.7%
10 State Street Bank & Trust com., Boston 342 342 342 2.0% 1.4%
Other shareholders 8,997 8,997 8,997 51.9% 37.5%
Total: 741 16,596 17,336 24,002 100% 100%
Total number of shareholders 30 September 2018: 9,825
Foreign owners: 49% of capital (35% of votes)
26Board of Directors (from 25 April 2018)
Chairman Isabelle Inger
Peter Elving
Peter Rothschild Ducellier Holmström
Anthon
David Dangoor Jahreskog
Ewa Björling Brit Stakston
27SALES AND PROFIT
5 YEARS DEVELOPMENT
28Sales – 5 years development
700
15%
600
11%
500
25%
400
22%
9%
300
Average growth: 16%
200
100
0
2013 2014*) 2015 2016 2017
29Sales, Operating expenses and Profit per year (MSEK)
700
600
Total sales
500
Gross profit
400
Operating expenses (cost
300 of goods excluded)
Operating result
200
Profit before tax
100
0
2013 2014*) 2015 2016 2017
*) Excluding license revenue Nestlé Infant Formula
30Q3 2018
31Quarter 3 2018 – Executive Summary
• Sales up with 18% (excluding currency effects 10%)
• Good sales growth in Pediatrics segment
• Decrease in Adult segment (excluding currency effects)
related to Protectis tablets
• Good sales growth for BioGaia Protectis drops, and also
good growth for BioGaia Prodentis lozenges
• Good growth in all three regions
• Continued investments in marketing activities, staff,
research and clinical studies
• Royalty from Nestlé regarding GUM are estimated to
decrease by SEK 40 million in 2019 compared to 2018 32Quarter 3 2018 – Key events
• BioGaia increases further in MetaboGen to 92%
• Launch of BioGaia Protectis tablets in Australia and
BioGaia Gastrus tablets in Poland and Hungary
Key events after the end of the quarter
• MetaboGen reaches development goal – first product
ready for safety study
33Sales per segment (MSEK)
Q3 Q3 Change Change Roll 12 Q3Roll 12 Q3 Change Change
2018 2017 % % 1) 2018 2017 % % 1)
Pediatrics 138 111 24% 15% 577 473 22% 20%
Adult health 36 36 1% -7% 124 101 22% 21%
Other 0 1 -58% -58% 2 9 -82% -82%
Total sales 175 148 18% 10% 702 584 20% 19%
1) Excluding currency effects
34Sales per geographical market (MSEK)
Q3 Q3 Change 12 months 12 months Change
2018 2017 % Q3 2018 q32017 %
EMEA 97 86 22% 13% 434 371 17%
Asia Pacific 36 23 61% 119 74 62%
Americas 41 39 6% 149 138 8%
175 148 18% 702 584 20%
Rolling 12 months:
EMEA 62% (63%)
Asia Pacific 17% (13)
Americas 21% (24)
35 35EBIT (MSEK) and EBIT margin
Q3 Q3 Change Roll12 Q3 Roll12 Q3 Change
2018 2017 % 2018 2017 %
EBIT *) 66 54 23% 264 218 21%
EBIT Margin 38% 36% 38% 37%
Profit after tax 51 42 22% 206 179 15%
EPS 2.97 2.43 22% 11.86 10.34 15%
*) Excluding revaluation of share in associates 7,0 (0) MSEK
36Present focus
• Continued growth of existing products
• New products such as Osteoporosis
• Continued growth in Americas and Asia Pacific
• Integration of MetaboGen
37www.biogaia.com
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