Investor Presentation April, 2012

Report
Paladin Labs Inc.
Mark Beaudet
Interim President & Chief Executive Officer
C O N F I D E N T I A L | www.paladinlabs.com
Forward Looking Statements
This presentation may contain forward-looking statements and predictions. These forwardlooking statements, by their nature, necessarily involve risks and uncertainties that could cause
actual results to differ materially from those contemplated by the forward-looking statements.
The Company considers the assumptions on which these forward-looking statements are based to
be reasonable at the time they were prepared, but cautions that these assumptions regarding
the future events, many of which are beyond the control of the Company and its subsidiaries,
may ultimately prove to be incorrect. Factors and risks, which could cause actual results to
differ materially from current expectations, are discussed in the annual report as well as in the
Company’s Annual Information Form for the year ended December 31, 2011. The Company
disclaims any intention or obligation to update or revise any forward-looking statements whether
a result of new information, future events, or except as required by law. For additional
information on risks and uncertainties relating to these forward-looking statements, investors
should consult the Company’s ongoing quarterly fillings, annual report and Annual Information
Form and other fillings found on SEDAR at www.sedar.com.
© Paladin Labs Inc.  www.paladinlabs.com
2
Company Overview
Paladin Labs is a specialty pharmaceutical company focused on acquiring or inlicensing innovative pharmaceutical products for the Canadian & select
international markets.
 Strong revenue growth
 5 year CAGR revenue growth of 24%
 Revenue $141.5 million, up 11% versus 2010
 Healthy, robust business
 Generated $67.6 million of EBITDA in 2011 or $3.27 per fully diluted share up 12.4%
from the prior year
 Rich, near-term pipeline for growth
 1 product awaiting regulatory approval
 Silenor®
 5 products pending regulatory submission
 Travelan®, VS-Sense OTC, AL-Sense OTC, Xomolix ®, Tostran®
 15 products in phase I, II and III
 Well poised to continue executing our growth strategy with $239 million in cash as at
December 31, 2011
© Paladin Labs Inc.  www.paladinlabs.com
3
Proven Strategies
1. Licensing of innovative pharmaceuticals
2. Acquisition of mature products from Big Pharma
3. Acquire “under-promoted” products from Big Pharma
4. To internally develop near-term, low risk/low expense products
for the Canadian or world market.
© Paladin Labs Inc.  www.paladinlabs.com
4
Key Partnerships
Paladin has partnered with over 30 companies including:
© Paladin Labs Inc.  www.paladinlabs.com
5
Management Team
Mr. Jonathan Ross Goodman, B.A., LL.B, M.B.A. - President & CEO (Medical Leave)
Mr. Mark A. Beaudet, B. Comm - Interim President & CEO
Ms. Samira Sakhia, B. Comm, C.A., M.B.A. - Chief Financial Officer
Mr. Mark Nawacki, B.A., C.A., M.B.A. - Vice President, Business & Corp. Dev.
Dr. Patrice Larose, B Pharm., PhD – Vice President, Scientific Affairs
Mr. Mike Freeman, LL.B., M.B.A. - Vice President, Government Affairs
© Paladin Labs Inc.  www.paladinlabs.com
6
Board of Directors
Mr. Ted Wise, Co-founder of Pharmascience Inc. & Chairman of Paladin Labs
Mr. Gerald McDole, Former President of AstraZeneca Canada
Mr. James C. Gale, Managing Director, Signet Healthcare Partners
Mr. Robert Lande, Chief Financial Officer of Forex Capital Markets LLC
Mr. Joel Raby, Former Senior Vice-President of Burgundy Asset Management
Mr. Jonathan Ross Goodman, Co-founder, President & CEO and Director
(Medical Leave)
Mr. Mark A. Beaudet, Co-founder, Interim President & CEO & Director
© Paladin Labs Inc.  www.paladinlabs.com
7
Revenue Growth


15 consecutive years of record revenues
Revenues for 2011 of $141.5 million, up 11% versus 2010
$150.0
$140.0
$130.0
$120.0
$110.0
$100.0
$90.0
$80.0
$70.0
$60.0
$50.0
$40.0
$30.0
$20.0
$10.0
$0.0
© Paladin Labs Inc.  www.paladinlabs.com
8
Healthy Robust Business


9 consecutive years of record EBITDA with EBITDA representing 48% of
revenues in 2011
EBITDA for 2011 of $67.6 million, up 20% versus 2010
$75.0
$70.0
$65.0
$60.0
$55.0
$50.0
$45.0
$40.0
$35.0
$30.0
$25.0
$20.0
$15.0
$10.0
$5.0
$0.0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
© Paladin Labs Inc.  www.paladinlabs.com
9
Key Products
Base
Business
Pain
®
DEXEDRINE
(dextroamphetamine sulfate)
Attention deficit hyperactivity
disorder
Once-daily treatment for moderate
pain
Management of breakthrough
cancer pain
Treatment for acute pain
Urology
Testosterone treatment therapy gel
Palliative treatment of prostate
cancer and endometriosis
OTC
© Paladin Labs Inc.  www.paladinlabs.com
Emergency contraceptive
10
Dexedrine: A large and stable mature brand

An anti-ADHD and narcolepsy drug

Mature product with established revenue
stream

Largest product by revenue

Canadian sales of Dexedrine were $17.7
million for the year ended December 31,
2011* up 9% from the same period in 2010
* IMS Canadian Drug and Hospital Audit, December 2011
© Paladin Labs Inc.  www.paladinlabs.com
11
Tridural:
A new way to treat pain
 The management of pain of
moderate severity for several days
or more
 Benefits
-
Initial rapid release
Rapid titration
Effective 24 hour pain
Favourable safety profile
 Opportunity for Tridural
- Market value of over $26 MM* in 2011
- Market share exceeds 50%
* IMS Canadian Drug and Hospital Audit, December 2011
© Paladin Labs Inc.  www.paladinlabs.com
12
Metadol:
A strong profile in severe pain
 Long acting opioid analgesic indicated
for the treatment of chronic cancer and
non-cancer pain
 Benefits
- Controls pain for opioid tolerant patients
- Effective for neuropathic pain
- Reimbursed by most provincial
formularies
 Opportunity for Metadol
- Continued growth in a stable, mature
market
- Sales increased 17%* in 2011
* IMS Canadian Drug and Hospital Audit, December 2011
© Paladin Labs Inc.  www.paladinlabs.com
13
Abstral:
Innovation in breakthrough pain
 Rapidly dissolving fentanyl, indicated
for the treatment of breakthrough
cancer pain
 Benefits
- Only oral tablet formulation in Canada
- Rapid Acting
- Short Lasting
 Opportunity for Abstral
- Proven medical need - class sales
exceeded $480 MM* in the US in 2011.
- First immediate release fentanyl available
in Canada
- Launched June 2011
* Wolters Kluwer TRx Sales
© Paladin Labs Inc.  www.paladinlabs.com
14
Testim:
A superior testosterone replacement gel
 Treatment for testosterone deficiency
in men
 Benefits
- Rapidly absorbed
- Convenient to use
- Gel is the preferred testosterone
replacement format
 Opportunity for Testim
- Continued strong growth
- The testosterone gel market grew 16%*
in 2011
- Testim sales grew 21%* in 2011
* IMS Canadian Drug and Hospital Audit, December 2011
© Paladin Labs Inc.  www.paladinlabs.com
15
Trelstar:
A better way to manage prostate cancer
 Treatment for advanced prostate
cancer & endometriosis
- Trelstar (3.75 mg) 1 month depot
- Trelstar LA (11.25 mg) 3 month depot
 Benefits
- Survival data
- Smaller needle size
 Opportunity
- Large market : $148* MM in 2011
- Sales increased 32%* for the year
* IMS Canadian Drug and Hospital Audit, December 2011
© Paladin Labs Inc.  www.paladinlabs.com
16
Over the Counter Portfolio
 Expanded from 1 product, Cerumol,
in 1999 to 9 products in 2011
 Acquired 2 Brands in 2011
- Tempra - Feb 2011
- Zincofax - June 2011
 OTC sales have grown 18%* to $20.5*
MM in 2011
 3 newly acquired products in the
pipeline
- AL-Sense
- VS-Sense
- Travelan
* IMS Canadian Drug and Hospital Audit, December 2011
© Paladin Labs Inc.  www.paladinlabs.com
17
Pipeline
Product
Indication
Potential
Oralair
Oral grass pollen
immunotherapy
Addresses dissatisfaction with
immunotherapy injections.
Co-seasonal administration.
Silenor
Treatment and symptomatic
relief of insomnia
Competes in the $87 million*
Zopiclone market in Canada
Only non-scheduled Rx
medication
AmnioSense
Diagnostic test to detect
amniotic fluid leakage
New innovative diagnostic
self-test for women. First in
category.
VagiSense
Detection of bacterial
vaginosis or trichomonas
infection
New innovative diagnostic
self-test for women. First in
category.
Travelan
Prevention of Travellers'
Diarrhea
First OTC product for this
indication
*IMS Canadian Drug and Hospital Audit , past 12 months ending Dec. 2012.
© Paladin Labs Inc.  www.paladinlabs.com
18
International Strategy
Establish international commercialization “platforms” in fast growth,
emerging markets that are ex US, EU and Japan.
 Similar financial, legal and governmental systems/ processes
 Stable societies, economies and currencies
Business models consistent with our own - “search, acquire and
commercialize”
Proven local operators, competency in core business functions
International management bandwidth
Financial oversight and control
Provide a path to majority ownership
Strategic and financial investment potential to Paladin.
© Paladin Labs Inc.  www.paladinlabs.com
19
International Product Rights
Product
Partner
Territory
Impavido
Aeterna Zentaris
Worldwide
Unisom
Johnson & Johnson
Australia, New-Zealand
Antizol
Jazz Pharmaceuticals
Worldwide
Voclosporin
Isotechnika
Latin America, South Africa, Israel
Heli-kit
Isotechnika
Worldwide
Urocit-K
Mission Pharmacal
Sub-Saharan Africa
TwiceDaily Tramadol-Acetaminophen
Proprietary
Sub-Saharan Africa
Intellitab Oxycodone-Acetaminophen
Proprietary
Sub-Saharan Africa
Abstral
Prostrakan
Mexico
Sancuso
Prostrakan
Latin America
Tostran
Prostrakan
Latin America, South Africa, Israel
Rectogesic
Prostrakan
Latin America
Xomolix
Prostrakan
Latin America, South Africa, Israel
Silenor
Somaxon
Latin America, Africa
AmnioSense
Common Sense
Latin America, Africa
VagiSense
Common Sense
Latin America, Africa
© Paladin Labs Inc.  www.paladinlabs.com
20
International Strategy
Why South Africa?
– English language, English common law system and similar regulatory systems
provide for a simpler and more stable operating environment
– Comfortable with the pace of political reforms and overall socio-political risk
profile
– “Macro” Factors Attractive:
- Africa’s collective GDP in 2008 roughly equaled Brazil or Russia – McKinsey
projects 2020 collective GDP to grow to USD $2.6 trillion*
- Households with disposable income of at least USD$ 5k projected to grow by 50%
from 85 million in 2008 to 128 million in 2020*
* McKinsey & Co. (“Lions on the move: the progress and potential of African economies”)(June 2010)
© Paladin Labs Inc.  www.paladinlabs.com
21
Pharmaplan – Paladin’s 1st International Investment

A leading independent specialty
pharmaceutical company South Africa.
 A staged approach
 Initial investment of 35% in March
2010
 Acquired an additional 10% in March
2011
 Results have been strong.
 Revenue of $46.3 MM in 2011
 +30.5% / +$10.8 MM vs. the 290
days ended December 2010.
 Net Income of $9.2 MM in 2011
 +68.5% / +$3.7 MM vs. the 290
days ended December 2010
© Paladin Labs Inc.  www.paladinlabs.com
22
Investment in The Litha Healthcare Group
About Litha

JSE-listed integrated healthcare company
with a varied product offering in:
- Vaccines
- Pharmaceuticals
- Medical devices

46 separate license partners and has
extensive contracts in both the public and
private healthcare sector

Strong financial results

Strong management team and Board of
Directors

Strong BBEE rating and a strong
commitment further improvement
© Paladin Labs Inc.  www.paladinlabs.com
23
Investment in The Litha Healthcare Group
1
Paladin Acquires
Remaining 55% of
Pharmaplan
• R 590 MM Valuation
• $38 MM CDN Cash
• 89 M shares of PLB @
$44.97
2
Paladin Merges
Pharmaplan with Litha’s
Pharma Division
• Receives $16 MM Cash
• 169 MM shares in Litha at
R2.75 per share.
3
Paladin Acquires Half of
Blackstar’s Litha
Holdings
• 73 MM Shares @ R2.75
• Deploy $26 MM CDN Cash
Paladin Acquires 44.5% of Litha Healthcare Group
•
•
•
•
•
Total outlay $52 MM - $48 MM Cash, $4 MM PLB Shares
Expected close by July 2, 2012
Subject to regulatory and shareholder approvals, mandatory offer to minorities
Paladin to appoint 3 board seats
Effective control of Litha - plan consolidated financial presentation
© Paladin Labs Inc.  www.paladinlabs.com
24
Investment in The Litha Healthcare Group
Strategic Rationale:
1.
2.
3.
4.
Improves BBEE rating – improves our prospects for future business
Management team depth and increased organizational capability
Provides operational critical mass
Improved positioning for further international licensing opportunities
Financial Rationale:
1.
2.
3.
4.
Attractive valuations of Pharmaplan and Litha
Transaction is expected to be immediately accretive to EBITDA
Projects an attractive ROI
Attractive growth prospects in the short, medium and longer term
© Paladin Labs Inc.  www.paladinlabs.com
25
Labopharm
Completed acquisition October, 2011
Strengthens top line revenues with the
addition of profitable international
revenue streams
Improves Canadian margin
Provides an opportunity to develop
international partnerships
Opportunity to out-license the
combination product TramadolAcetaminophen BID
Expect to complete integration by Q2 2012
© Paladin Labs Inc.  www.paladinlabs.com
26
Tramadol International Markets
 Paladin currently has partnerships for the commercialization of Tramadol
in the following International markets
 USA
 France
 France/Belgium
 Germany
 Spain/Portugal
 Italy
 Eastern Europe
 Australia







South Korea
Greece/Cyprus
Turkey
Israel
Portugal
Switzerland
Japan
© Paladin Labs Inc.  www.paladinlabs.com
-
Purdue Pharma Products LP
sanofi aventis
Grünenthal GmbH
HEXAL AG
Esteve SA
Gruppo Angelini [Aziende Chimiche Riunite
Angelini Francesco A.C.R.A.F.S.p.A.]
- CSC Pharmaceuticals
- iNova Pharmaceuticals (Australia) Pty
Limited
- WhanIn Pharmaceutical Co., Ltd.
- Lavipharm S.A.
- Dr. F. Frik Ilac San ve Tic. A.S.
- Dexcel Pharma Technologies Ltd.
- Kiron Pharma
- Gebro
- Nippon Shinyaku Co., Ltd.
27
Near-Term Growth Drivers
Current
Product
Corporate
•
•
Abstral
Digifab
•
Integration of Labopharm
•
•
© Paladin Labs Inc.  www.paladinlabs.com
International revenue
streams
Synergies
Pipeline
•
•
•
•
•
Oralair (approved in March 2012)
Silenor
AmnioSense
VagiSense
Travelan
•
Closing Litha Transaction
•
Consolidation in Q3
28
Strong Balance Sheet to Fund Future Growth
Current Share Price (April 27, 2012)
$40.03
Shares Outstanding (Year ended 2011)
20.3M
Cash and Marketable Securities (Year ended 2011)
$239.0M
EBITDA (Year ended 2011)
$67.6M
Revenue (Year ended 2011)
$141.5M
Analyst Coverage:
Bloom Burton & Co. (Philippa Flint)
Byron Capital Management (Douglas Loe)
Desjardins Securities (Pooya Hemami)
GMP Securities Ltd. (Cosme Ordonez)
© Paladin Labs Inc.  www.paladinlabs.com
Paradigm Capital (Alan Ridgeway)
RBC Dominion Securities Inc. (Douglas Miehm)
TD Newcrest (Lennox Gibbs)
29
Summary
 Proven partner for the Canadian market
 Expanding internationally to fuel future growth
 Demonstrated track record of profitable growth
 Proven ability to fill a product pipeline
 Experienced & dynamic management team
 Financial strength to execute our strategy
© Paladin Labs Inc.  www.paladinlabs.com
30
Forward Looking Statements
This presentation may contain forward-looking statements and predictions. These forwardlooking statements, by their nature, necessarily involve risks and uncertainties that could cause
actual results to differ materially from those contemplated by the forward-looking statements.
The Company considers the assumptions on which these forward-looking statements are based
to be reasonable at the time they were prepared, but cautions that these assumptions regarding
the future events, many of which are beyond the control of the Company and its subsidiaries,
may ultimately prove to be incorrect. Factors and risks, which could cause actual results to
differ materially from current expectations, are discussed in the annual report as well as in the
Company’s Annual Information Form for the year ended December 31, 2010. The Company
disclaims any intention or obligation to update or revise any forward-looking statements
whether a result of new information, future events, or except as required by law. For
additional information on risks and uncertainties relating to these forward-looking statements,
investors should consult the Company’s ongoing quarterly fillings, annual report and Annual
Information Form and other fillings found on SEDAR at www.sedar.com.
© Paladin Labs Inc.  www.paladinlabs.com
31
Paladin Labs Inc.
Mark Beaudet
Interim President & Chief Executive Officer
C O N F I D E N T I A L | www.paladinlabs.com

similar documents