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Novo Nordisk Global Focused Pharmaceutical with Biotech Expertise Mads Krogsgaard Thomsen Chief Science Officer Februar PowerPoint Presentation
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Novo Nordisk Global Focused Pharmaceutical with Biotech Expertise Mads Krogsgaard Thomsen Chief Science Officer Februar
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  1. Novo Nordisk Global Focused Pharmaceutical with Biotech Expertise Mads Krogsgaard Thomsen Chief Science Officer February 2001

  2. Novo Nordisk – Key drivers Coagulation disorders Diabetes Carebusiness Primary growth drivers Secondary value drivers Human growth hormone HRT ZymoGenetics

  3. Novo Nordisk Net turnover split by therapy DKK billion • Global Focused Pharmaceutical with Biotech Expertise • Leader in diabetes care • Strong market presence in haematology and growth disorders • Strong organic sales growth

  4. Novo Nordisk – Key drivers Coagulation disorders Diabetes Carebusiness Primary growth drivers Secondary value drivers Human growth hormone HRT ZymoGenetics

  5. Diabetes careSales by year NovoRapid®/NovoLog®:EU: Under roll out US: Approved Japan: Filed New innovative devices:Innovo®: EU and JapanInnoLet®: EU DKK million

  6. Insulin market overview(’99/ ’00 MAT Q3 volumes) % market size MAT Q3.00 Market growth (‘00/’99) Novo Nordisk Market share 44% 46% 4% 6% 100% Notes: Industrialised world only. Mail-order panel now included in the US figures. Market growth in Europe is affected by above +4% point from conversion of formulation in Italy and France. The effect on the world market growth is estimated to be approx. +2% point.

  7. Volume Insulin market growth forecast 5% 10% 5% + = Value Price/Mix • Population growth • Ageing population • Increased prevalence • Better diagnosis • More patients should use insulin • More intensive therapy is necessary • More sofiticated insulin • More sofisticated delivery systems

  8. Diabetes – a complex disease • Brain • - GLP-1. Liver - Hepatic enzyme inh. - PPAR a - Glukokinase - Glucagon antagonists - Insulin - Insulin mimetics. • ß-cell • - PGR • - PCO • - GLP-1. • Muscle/Fat • - Insulin sensitisers • - Insulin • - Insulin mimetics • - PPAR g • - GLUT4 • - TNF a • - PTPase. Gut - GLP-1.

  9. Diabetes – sources of innovation • Clinical research • Steno Diabetes Centre • Oxford Diabetes Centre • Clinical research centres worldwide • Basic research • Hagedorn Research Institute • Oxford and Steno Diabetes Centre • Academic collaborations • Consortia • Evidence-based medicine • NN disease mgt programmes • Outcomes data from > 100.000 • individuals with diabetes R&D projects • Molecular diversity & design • Protein chemistry since ’23 • Medicinal chemistry since ’68 • Computational chemistry since ’75 • Rational drug design since ’83 • Combinatorial chemistry since ’93 • Drug target & screening • Molecular biology since ’80 • HT screening: Amersham since ’92 • Chemoinformatics since ’95 • Dundee MRC consortium since ’98 • Ultra HT Screening since ’00 • Trinomics • Genomics: Incyte since ’95 • Proteomics: CPA since ’97 • Metabonomics since ’99

  10. Diabetes – evolution of a project Stable cell lines Chemistry Identify & clone target Establish biological function High throughput screening In vitro biological profile In vivo diabetes models Diabetes expertice Diabetes models PLPc

  11. Diabetes pipeline Phase 3 Phase 1 Phase 2 Registration • NN4201(Hepatic glucose regulator) • NN1998(AERx) • NN304(Basal analogue) • NovoMix® 30(Premix analogue) • NN414(Insulin secretion) • NN2344(Insulin sensitiser) • NovoMix® (other mixes)(Premix analogue) • NN1215(LABI) • NN622(Dual acting sensitiser) • NN2211(GLP-1 analogue)

  12. Novo Nordisk – Key drivers Diabetes Carebusiness Coagulation disorders Primary growth drivers Secondary value drivers Human growth hormone HRT ZymoGenetics

  13. Coagulation disorders NovoSeven® sales DKK million Inhibitor indication: Expected market potential USD 350 million Launched EU: Feb 1996 USA: April 1999 Japan: May 2000

  14. rFVIIa (NovoSeven®) Activation of platelets without NovoSeven® NovoSeven® mechanism of action Tissue factor - only at site of injury FXa The key impact of NovoSeven® is through injury site selective platelet activation to ensure high local thrombin formation which secures a tight fibrin clot Platelet activation Thrombin activation and burst Local activation of platelets &clot formation withNovoSeven®

  15. NovoSeven® update Coagulation Factor Deficiency PlateletDisorder GeneralHaemostasis Single Factor Multiple Factors Lack of platelets Defective platelets Surgical bleeding Spontaneous bleeding Glanzmann Bernard-Souliers Haemophilia with inhibitors Liver resection Hip replacements Haemorrhagic dilution coagulopathy Oozing after cardiac valve replacement Colon cancer surgery Intra-cerebral bleeds Traumatology Liver transplantationsUpper gastro intestinal bleeds Liver resection Current indication Vitamin K-antagonists Bone marrow transplantation Upper gastro- intestinal Area of chronic liver disease

  16. Financial results 2000 DKK million20001999% change Net turnover 20,811 16,423 27 Operating profit as reported 4,816 3,527 37 Operating profit adjusted*) 4,555 3,151 45Financial items 24 -178 - Profit before tax 4,840 3,349 45 Net profit 3,087 2,001 54 Earnings per share (DKK) 44.20 27.98 58 Earnings per ADS**) (USD) 2.76 1.74 58 *) Excluding Seroxat® licence income, one-off income in 2000 and Seroxat® licence income and restructuring costs in 1999. **) Translated for convenience at the end 2000 exchange rate of USD 100 = DKK 802.05

  17. New long-term targets • Operating profit (EBIT) growth of 15% p.a. • Operating margin (EBIT-margin) of 25% • Return on invested capital (ROIC) of 25% p.a. • Cash to earnings ratio of 60%. Notes: Cash to earnings target is based on a three-year rolling average for the cash flow.

  18. World leader with steady growth for 76 years 2/3 of business (insulin) growing >10% p.a. Expansion strategy in the US The most comprehensive insulin and insulin device portfolio in the industry – one new device per year Sensitisers (NN2344 and NN622) Liver programmes (NN4201) NN2211 (GLP-1 analogue) NN414 (insulin secretion). Novo Nordisk – Key drivers Diabetes business Coagulation disorders Peak sales potential for current NovoSeven® indication = USD 350 million Entering 8 new clinical areas with studies in 2001 Strategy for making NovoSeven® the first general haemostatic agent Moving towards haemostasis management Patent protection until 2007-11. Primary growth drivers Secondary value drivers Human growth hormone HRT ZymoGenetics

  19. No major patent expirations % of 1999 sales with patents expiring in 2000-2004 Source: Aros Securities Research and Novo Nordisk

  20. Forward-looking statements This conference call contains forward-looking statements as the term is defined in the US Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risk and uncertainties that may cause actual results to differ materially from expectations, including unexpected developments in the international currency exchange and securities markets, government-mandated or market-driven price decreases for Novo Nordisk's products in the company's major markets and the introduction of competing products within Novo Nordisk's core businesses. These and other risks and uncertainties are further described in reports filed with the US Securities and Exchange Commission (SEC) by Novo Nordisk and readily available to the public, including the company's Form 20-F, which was filed on 2 May 2000. A Form 20-F for 2000 will be filed by the end of June 2001.

  21. Investor information Share informationNovo Nordisk’s B shares are listed on the stock exchanges in Copenhagen and London. Its ADSs are listed on the New York Stock Exchange under the symbol "NVO". For further company information, visit Novo Nordisk on the World Wide Web at http://www.novonordisk.com Investor Relations Contacts:Novo Nordisk A/S Investor Relations Novo Allé DK­2880 BagsværdDenmark Fax (+45) 4444 2314. Peter HaahrPhone (+45) 4442 1207 E-mail: pehr@novonordisk.com Palle Holm Olesen Phone (+45) 4442 6175 E-mail: phoo@novonordisk.com Rasmus Holm-JørgensenPhone (+1) 212 878 0123 E-mail: rrhj@novonordisk.com

  22. Appendix

  23. Insulin etcSales by quarter NovoRapid®/NovoLog®:EU: Roll-out ongoing US: Launch H2 2001 Japan: Filed New innovative devices:Innovo®: EU and JapanInnoLet®: EU

  24. Human growth hormoneSales by quarter DKK million Norditropin® SimpleXx™: Launched EU: April 1999 Japan: July 2000 USA: Oct 2000

  25. Coagulation disorders (NovoSeven®) Sales by quarter DKK million Inhibitor indication: Expected market potential USD 350 million Launched EU: Feb 1996 USA: April 1999 Japan: May 2000

  26. Turnover by therapy DKK million20001999% of total% change(2000) Insulin etc 13,491 11,049 65 22 NovoNorm™/Prandin®1,087728549 Diabetes care, total 14,578 11,77770 24 Coagulation disorders* 2,270 1,3131173 Human growth hormone 2,1071,7211022 HRT 1,3061,130616 Other 550482314 Total 20,81116,42310027 * NovoSeven®

  27. Turnover by geography DKK million20001999% of total% change (2000) Europe 9,905 8,286 47.6 20 Japan 4,3853,40421.129 USA 3,7472,42718.054 Rest of World 2,7742,30613.320 Total 20,81116,42310027

  28. NovoSeven® mechanism of action Tissue factor Rupture FVIIa / NovoSeven®

  29. NovoSeven® studies in 2001 Clinical area Status on project Orthotopic liver transplantations* Ongoing Ph 2/3 project Liver resection (normal coagulation) Exploratory Ph 2 study has been initiated Upper GI bleeds* Ph 2 study expected to start in first half 2001 Liver resection* Ph 2 study expected to start in first half 2001 Reversal of anti-coagulant therapy Ph 2 study expected to start in first half 2001 Bone marrow transplantation Ph 2 study expected to start in first half 2001 Intra-cerebral bleeds Exploratory Ph 2 study expected to start by mid-2001 Traumatology Ph 2 study expected to start by year-end 2001 * Patients with chronic liver disease

  30. Current issues • Settlement on two patents with Aventis • Share buy-back programme completed • Proposed dividend of DKK 13.25 per share (DKK 6.63 per ADS) ie an increase in payout ratio from 29% to 30% • Reduction in B share capital of nominal DKK 45 million (4,500,000 B shares) corresponding to 6% of the total capital • Split of shares (1:5): 1 B share (nom DKK 10)  5 B shares (nom DKK 2 each) 1 ADS (nom DKK 5)  2.5 ADSs (nom DKK 2 each)

  31. Financial key figures Per cent200019991998 Gross margin 75.8 74.3 72.5 R&D to sales 16.3 16.7 20.5 S&D to sales 30.1 29.3 30.9Adm to sales 9.0 10.5 10.2 Operating margin23.1 21.5 21.5 Operating margin adjusted*) 21.919.2 16.9 Return on invested capital 22.3 15.1 14.4 Cash to earnings ratio 87.9 76.6 35.0 Definitions: ROIC: Operating profit after tax as a percentage of average stocks, debtors, tangible & intangible assets less non-interest bearing liabilities (provisions included and proposed dividends excluded). Cash to earnings: Cash flow before financing (free cash flow) as a percentage of net profit.

  32. Outlook for 2001 • Growth in operating profit of 15% is expected • Including the impact of the settlement with Aventis • Net financial income is expected to be approx. DKK 300 million • Tax rate expected at 36% • Investments expected to be up to DKK 2.8 billion • Above outlook is based on the assumption that exchange rates remain at the current level (February 20 2001).

  33. Vision for Novo Nordisk • The world’s leading diabetes care company • Our aspiration is to defeat diabetes by finding better methods of diabetes prevention, detection and treatment • We will work actively to promote collaboration between all parties in the health care system in order to achieve our common goals • Offer products and services in other areas where we can make a difference • Our research will lead to the discovery of new, innovative products also outside diabetes. We will develop and market such products ourselves whenever we can do it as well as or better than others • Competitive business results • Our focus is our strength • We will stay independent and form alliances whenever they serve our business purpose and the cause we stand for

  34. Insulin sales growth drivers 1:Increased number of diabetics Increase in the number of diabetics from 150 million to 220 million – 10 years from now – yearly growth of 3.9%. Source: Amos A.., McCarty DJ, Zimmet P: Diabet. Med. 1997; 14

  35. Insulin sales growth drivers 2:Increased rate of diagnostics Only about one third of diabetics are diagnosed Increased rate of diagnosis leads to higher insulin sales.

  36. Insulin sales growth drivers 3:More patients should use insulin Number of diabetics using medication: 25-30 million More patients should move to the use of insulin. Oral products Oral/insulin Insulin 66% 7% 27%

  37. Insulin sales growth drivers 4:More intensive therapy • The major land mark study, UKPDS*),prescribed: • Early intervention • Intensified therapy • Use products in combination • More patients on insulin. • *) UKPDS = UK Prospective Diabetes Study

  38. Insulin sales growth drivers 5a:Increased product sophistication Cartridge & Prefilled penetration in the insulin market (volume) by region MAT Q3.00

  39. Insulin sales growth drivers 5b:Increased product sophistication The industry’s most comprehensiveinsulin device portfolio One new device to be introduced per year. Electronic insulin dosers Insulin pens Conventionalsyringes

  40. Insulin sales growth drivers 5c:Increased product sophistication • The industry’s most comprehensive portfolio of insulin analogues • Rapid acting insulin analogue launched in EU, approved in US • Basal insulin analogue in phase 3 • Premixed insulin analogue approved in EU NVO LLY AVE Rapid-acting Marketed Marketed Ph1/Ph2 Basal Ph3 Marketed Premix, protracted Approved Marketed

  41. Insulin sales growth drivers 6:More aggressive US strategy • 400 new sales reps. hired / rented during 2000 • Total number of reps. by end 2004 = up to 1,000 • US insulin market size = USD 1 billion • Pen penetration = 6.8% (vol. MAT Q3 2000) • 50% price premium on penproducts • US market share (vol.) 20.1% in ’98, 20.2% in ’99 and 24.6% MAT Q3 2000.Note: Market shares now include mail-order panels.