ShapeShapeauthorShapechevroncrossShapeShapeShapeGrouphamburgerhomeGroupmagnifyShapeShapeShaperssShape

Boehringer Ingelheim Net Sales Grew 10 Per Cent

by 5m Editor
22 April 2010, at 10:53am

GERMANY - In 2009, Boehringer Ingelheim grew faster than the pharmaceutical market for the tenth time in succession. It also continued a high level of investment in R&D and the market launches of five innovative medicines are planned.

Boehringer Ingelheim continued to grow in 2009, increasing its net sales by 9.7 per cent to €12.7 billion (2008: €11.6 billion). This was announced today by the company at its Annual Press Conference. Even without taking into account positive currency effects, growth was once again above the average growth for the worldwide pharmaceutical market, at 6.7 per cent. This means that for the tenth consecutive time, Boehringer Ingelheim grew faster than the pharmaceutical market and in 2009 was the fastest growing company of the world's 15 largest pharmaceutical companies.

Operating income, comparable to EBIT, rose to €2.2 billion, despite higher investments planned for research and development. Professor Andreas Barner, Chairman of the Board of Managing Directors and responsible for the Corporate Board Division Research & Development and Medicine, expressed his satisfaction with the 2009 business year. He said: "In view of the difficult economic environment, we believe that the success of 2009 confirms that our entrepreneurial approach was right. The success of our innovative medicines for patients and our promising research pipeline give us cause to be optimistic about the future."

Boehringer Ingelheim again invested considerably in its future in 2009, the 125th year in the company's history. Expenditure for the research and development of new medicines and therapies again increased by more than €100 million to €2.2 billion. The company thus directly reinvested 21 per cent of net sales from the Prescription Medicines business in research and development.

Professor Barner continued: "Five therapeutically promising, innovative medicines from our own pipeline have provided very positive data in clinical studies. These new medicines in indication areas, some of which are new for our company, will offer patients significant therapeutic progress as well as being important for the future of Boehringer Ingelheim, which is now in its 125th year as an independent, family-owned company."

Financial position: business success and solid funding

As in previous years, high operating cash flow of approximately €2.4 billion (+26 per cent) in 2009 enabled Boehringer Ingelheim to finance its investments in full.

Boehringer Ingelheim again invested the largest portion of the €630 million of investments in tangible assets, primarily in production capacities for new products as well as buildings and technical plants at its research and development sites. In order to strengthen liquidity and to increase financial and commercial flexibility, Boehringer Ingelheim borrowed a total of €1,300 million in 2009. The main portion resulted from the successful placement of a Schuldscheindarlehen (German private placement) with a volume of €900 million. The funds will secure liquidity and increase the company's financial and commercial flexibility.

Hubertus von Baumbach, member of the Board of Managing Directors responsible for the Corporate Board Division Finance and Animal Health, commented: "Boehringer Ingelheim is very well-equipped for the coming years, thanks not least to the good product pipeline. We will offset the sales losses that we expect this year in the USA, due to the expiry of patent protection, by growing the existing portfolio and launching new products. The healthcare system changes, in Germany and the USA, for example, will also have an important effect. During the coming years, the economic development, particularly in the emerging markets, will have a considerable influence on our business."

Animal health: increased sales through organic growth



Business with Animal Health medications developed very satisfactorily. It increased by 30.6 per cent or 29.4 per cent in local currency terms to a total of €610 million.

Hubertus von Baumbach, who is responsible worldwide for Animal Health, explained: This is almost exclusively due to organic growth of our own product portfolio and was not the result of the acquisition of parts of the Fort Dodge business from Pfizer/Wyeth.

"On the contrary, the most important growth driver was our swine vaccine portfolio, including the core product Ingelvac CircoFLEX®."

With €157 million net sales, Ingelvac CircoFLEX is by far Boehringer Ingelheim's biggest vaccine and the world's biggest single vaccine in this market. Nevertheless, established products also made major contributions to this growth.

Outlook for 2010: sales at the previous year's level, increased expenditure for new launches

Professor Barner commented: "In 2009, we prepared well for the more challenging business year 2010."

Boehringer Ingelheim is expecting total net sales to be at the previous year's level in the 2010 financial year. This means that the expected loss of sales caused by competition from generic drugs for important turnover generators on the US pharmaceutical market, such as FLOMAX, SIFROL/MIRAPEX and CATAPRESAN TTS will be largely offset by growth of the remaining portfolio. On the cost side, increased expenditure for the scientific profiling and introduction of innovative new medicines is envisaged. At the same time, the company has made a conscious decision to further increase expenditure for research and development. These investments in the future will impact on operating income in 2010.

However, Boehringer Ingelheim has already laid the foundation for the company's future sustained growth.

Professor Barner added: "We are expecting further new launches in 2010 which will lead Boehringer Ingelheim into another successful growth phase – with medicines which offer patients a convincing therapeutic advantage in the treatment of their diseases or the prevention of diseases."

Furthermore, in the future, Boehringer Ingelheim also intends to invest in biotechnology and start-up companies, which are researching promising therapy approaches and technologies in order to promote innovation in medical science. For this purpose, Boehringer Ingelheim has created a corporate venture capital fund (BIVF) with a financial volume of €100 million.

"The investments will extend well beyond Boehringer Ingelheim’s current areas of therapy and our existing research topics and technologies," explained Professor Barner, stating that initial investments have already been planned for this year.

Further Reading

- You can view the full report by clicking here.