Mission and strategy
Mission to build well-being
Orion’s mission is to build well-being. To this end, Orion provides pharmaceuticals and diagnostic tests that help patients to effectively treat their diseases. Effective drugs also provide added value for patients by improving quality of life.
Orion’s strategy is affected by global healthcare megatrends that have material impact on trends in consumption of drugs, the price level of drugs and progress in pharmaceutical research. These megatrends include:
- Ageing of population
- Advances in science, such as personalised medicine, increased genetic and epigenetic data, developments in drug dosing and developments in diagnostics
- The increasing cost burden of healthcare and consequent need for cost-effective treatments and drugs
- Increased personal responsibility for own health
For Orion to fulfil the mission and achieve the strategic targets, within the Company there must be systematic concentration on key focus areas and their development. The crucial focus areas for implementing the strategy are:
- Quality and safety. High quality, product safety and complying with requirements of authorities are indispensable in the pharmaceutical industry. To meet ever increasing requirements and expectations of stakeholder groups, Orion is continuously and systematically developing these areas.
- Productivity and flexibility. Under pressure from declining prices for drugs, Orion needs cost awareness in its operations and seamless co-operation between different parts of the Company to achieve the targeted profitability level. In addition, operations must be flexible and able to react rapidly to changes identified in the operating environment. Due to its size, Orion can be more agile than large companies and gain a competitive advantage from this.
- Partnerships. Orion’s operations are almost in their entirety based on utilising worldwide networks in which well-managed partnerships and collaborations are a competitive advantage for the Company. This requires Orion to be unprejudiced and open to learning new things from partners and collaborators. Partnerships must also be managed so that jointly agreed modes of operation and responsibilities are adopted at every level.
- Competitive and strong portfolio, which is crucial for Orion’s success. This requires from the Company continuous striving to renew the portfolio, which in addition to product development, acquisition or manufacturing, includes effective launching of products and management of their entire life cycle.
- Strong corporate culture of working together, the basis of which is valuable and important work for the customer. Orion wants to be an excellent workplace and a responsible and attractive employer that promotes the well-being of its personnel at work and continuously develops their expertise.
The following strategic targets have been confirmed, and their achievement is monitored with clearly defined indicators:
- Providing new innovative and cost-effective drugs and treatments for patients. Orion launches a steady stream of new drugs and diagnostic tests into markets. The product development pipeline has balanced numbers of proprietary products and generic projects in different phases. In its research the Company aims for the best input/output ratio in the field.
- Working together to benefit the customer. Orion’s personnel are committed and understand the needs of customers. The working atmosphere, customer satisfaction and image of Orion are outstanding.
- Continuous improvement in operations as regards sustainability. Patient safety is the most vital aspect of Orion’s corporate responsibility. The key to patient safety is that Orion’s products are safe when used appropriately. Managing the Company’s environmental responsibilities is also an important part of sustainability. Orion’s aims additionally include continuous development of the personnel’s occupational safety and ability to cope with their work.
- Growing faster than the markets. Growth enables a company to develop and take manageable risks. This aim should be achieved by the Company as a whole and in the geographic and product areas in which Orion operates.
- Strong development of profitability.
Through financial objectives Orion aim to develop the Group’s shareholder value and ensure financial stability and profitable growth.
Orion’s financial objectives are:
- Growing net sales more rapidly than growth of the pharmaceuticals market. Achievement of this objective requires continuous investment in development of the product portfolio.
- Maintaining profitability at a good level. The aim is operating profit that exceeds 25% of net sales.
- Keeping the equity ratio at least 50%.
- Distributing an annual dividend that in the next few years will be at least EUR 1.30 per share, and increasing the dividend in the long term.
In the short term what actually happens may deviate from the objectives.
Promising developments in the R&D project pipeline will probably somewhat increase the Company’s research expenses in the next few years. However, agreements already made relating to research projects (Bayer/ODM-201, Janssen/ORM-12741) and their good progress, and possible new agreements with partners relating to other projects are expected to generate material upfront and milestone payments in coming years. Successful projects will have a positive effect on Orion’s net sales and especially operating profit even before possible approval of new proprietary drugs and before the actual commencement of product sales.