CEO Timo Lappalainen's reviews 2014

Published on 4 February 2015

“Good year in pharmaceutical development and commercialisation projects”

 “In 2014 our net sales and operating profit were both similar to the previous year. However, as regards operating profit in particular, it should be noted that milestone payments from collaboration partners higher than in the previous year are included.

 “We are especially pleased with the strides forward in our main clinical pharmaceutical development and commercialisation projects in 2014. During the year we received national marketing authorisations for our new Bufomix Easyhaler® in most European countries, and in the summer our collaboration partner Novartis received marketing authorisation for Stalevo® in Japan.

“In June we commenced global collaboration with Bayer in the development and commercialisation of the ODM-201 compound for treatment of prostate cancer. We have jointly started a Phase III clinical trial, and in accordance with our agreement, since the beginning of 2015 Bayer has been the driving force for the project and taken main responsibility for future costs.

“As regards the alpha-2c adrenoceptor antagonist for treatment of symptoms of Alzheimer’s disease (ORM-12741), during the year with our collaboration partner Janssen Pharmaceuticals we focused on optimising the drug composition and we are preparing to commence a new Phase IIa clinical trial with the compound. Of the two COMT inhibitors for treatment of Parkinson’s disease (ODM-103 and ODM-104), we selected ODM-104 for further development. In addition, we began Phase I clinical safety trials with the ODM-203 molecule, which is a new targeted FGFR+VEGFR inhibitor that slows growth of certain solid cancerous tumours. During the current year, our clinical development pipeline will be further boosted as we commence Phase I clinical safety trials with an investigational CYP17 enzyme and androgen receptor inhibitor (ODM-204) for treatment of castration-resistant prostate cancer, and with a GABA-B receptor positive allosteric modulator (ODM-106) for treatment of symptoms of essential tremor.

“Deliveries of our Parkinson’s drugs to Novartis and sales through Orion’s own sales network were lower than a year ago. In Europe generic competition to Stalevo commenced in Germany in 2014, and competition is expected to have extended in Europe by the end of this year, decreasing Orion’s sales. In addition, generic competition to the Precedex® intensive care sedative commenced in the United States during autumn 2014, and sales of the product and the royalties received from it have subsequently clearly decreased.

“Sales of other products especially through Orion’s own sales network developed well and sales of Pharmaceuticals as a whole remained similar to the previous year. The intensive care sedative Dexdor® and the Easyhaler® product family in particular maintained their strong growth. In the Specialty Products business division, net sales of generic entacapone products grew especially strongly, and sales of the other products in the portfolio also grew.

“In 2012 we commenced for Orion significant investment and production reorganisation projects to develop and ensure future growth, delivery reliability and quality standards. During 2014 these projects progressed as planned, and among other things, we celebrated the inauguration of the new Salo plant in March. During the current year we will mostly complete the investment programme and projects still in progress.

“A financial objective of Orion is to increase net sales. During the current year the steadily growing business areas such as Specialty Products,Dexdor and the Easyhaler product family will not be able to compensate fully for the decrease in net sales and operating profit due to some rapid changes, such as extension of generic competition to Stalevo in Europe, declining royalties from Precedex and the timing of milestone payments. For these reasons among others, we estimate that our net sales will be slightly lower in 2015. We estimate that operating profit will remain above 20% of net sales, in line with our financial objectives. The negative impact due to Stalevo and Precedex is expected to level out in 2016 as growth in other areas starts to have a positive effect on development of the entire company. We estimate that in 2015 our net sales will be slightly lower than in 2014. Operating profit is estimated to exceed EUR 200 million. 

 

Published on 21 October 2014

“Advances in pharmaceutical development projects”

“In January–September both our net sales and operating profit were slightly higher than in 2013. Net sales and operating profit include significant milestone payments received from collaboration partners that were higher than in the previous year.

“In the third quarter we took strides forward in our main clinical pharmaceutical development projects. The collaboration with Bayer on development of the ODM-201 molecule for treatment of prostate cancer has started well, and recruiting of patients for Phase III clinical trials has commenced. We completed Phase I clinical trials with two COMT inhibitors (ODM-103 and ODM-104) for treatment of Parkinson’s disease, and based on the results we have decided to continue development of the ODM-104 compound. In addition, we began Phase I clinical safety trials with the ODM-203 molecule, which is a new targeted FGFR+VEGFR inhibitor. Pre-clinical study results indicate that ODM-203 slows growth of certain solid cancerous tumours.

“Deliveries of our Parkinson’s drugs to Novartis and sales through our own sales network were clearly lower than a year ago. In Europe generic competition to Stalevo has commenced in Germany. Competition is expected to have extended throughout Europe by the end of next year, decreasing Orion’s sales. Generic competition to the Precedex® intensive care sedative also commenced in the United States during the autumn when the first generic products entered the markets. Following the commencement of generic competition, the royalties to be received from Hospira will further decrease.

“As a whole the product sales were however at similar level to 2013. Especially the intensive care sedative dexdor® and the Easyhaler® product family maintained their strong growth. The Specialty Products business division continued to grow steadily. Net sales of generic entacapone products in particular grew strongly, and sales of the other products in the portfolio also grew. For the other business divisions, the year has proceeded as anticipated. The significant investment and production reorganisation projects have progressed as planned.

“Our outlook estimate remains unchanged. We estimate that our net sales and operating profit in 2014 will be at similar level to 2013.”

 

Published on 29 July 2014

“Payments from partners increased net sales and operating profit”

“In the first half of 2014 our net sales were slightly higher and our operating profit higher than in 2013. Significant part of the increase in net sales and operating profit were due to milestone payments received from collaboration partners during the review period.

“At the beginning of June we announced that we had entered into a global partnership with Bayer for development and commercialisation of the compound ODM-201. From the upfront payment of EUR 50 million Orion received, EUR 27 million will be used for the currently estimated development costs of ODM-201 during 2014 and EUR 23 million we have recorded in profit, following which we updated our outlook estimate for the current year as regards operating profit.

“We are pleased with the agreement made with Bayer, under which Orion and Bayer will jointly develop ODM-201 and Bayer will contribute the major share of future development costs. Bayer will commercialise the product globally, but Orion has the option of co-promoting it in Europe, and we are also entitled to receive from Bayer certain milestone payments related to successful development, technology transfer and commercialisation phases, and substantial royalties on future sales. In addition, Orion will be responsible for manufacturing of the product.

“We received other favourable news about our drug development projects in the beginning of July when our collaboration partner Novartis announced that it had been granted marketing authorisation for Stalevo® in Japan.

“Deliveries of our Parkinson’s drugs to Novartis were clearly lower than a year ago. Total sales of Stalevo® and Comtess® through Orion’s own sales organisation were lower than in 2013. In Europe generic competition to Stalevo has begun in Germany, but this has not yet materially affected our sales.

“Among our other proprietary drugs, the intensive care sedative dexdor® and the Easyhaler® product family maintained their strong growth. During the review period we were granted the first national marketing authorisations for Bufomix Easyhaler®, and we have started the launches. In addition, we recorded a milestone payment of EUR 6 million from Takeda related to national marketing authorisations granted for Bufomix Easyhaler. Sales of the intensive care sedative Precedex® were clearly lower because the royalties received by Orion from Hospira decreased. Generic competition has not commenced in US markets.

“The Specialty Products business division continued to grow steadily. Net sales of generic entacapone products in particular grew strongly, but sales of the other products in the portfolio also grew slightly. For the other business divisions, the first half of the year has proceeded as anticipated. The significant investment and production reorganisation projects have progressed as planned.

“Our outlook estimate was updated during the review period. We estimate that our net sales and operating profit in 2014 will be at similar level to 2013.”

 

Published on 29 April 2014

“First marketing authorisations in Europe for Bufomix Easyhaler®””

“Our net sales were similar to the previous year and as expected our operating profit was slightly lower than in 2013. The decrease in operating profit was mainly due to products with lower margins accounting for an increasing proportion of sales.

“Deliveries of our Parkinson’s drugs to Novartis were clearly lower than a year ago. Total sales generated by Stalevo® and Comtess® in Orion’s own sales organisation were slightly lower than in the previous year. The first (competing) generic versions of Stalevo in Europe were granted marketing authorisation in Germany.

“Following the expiry of the basic Precedex® patent in the United States in January, the level of royalties received by Orion from Hospira decreased and consequently the net sales recorded by Orion decreased. Generic competition has not commenced in US markets.

“Sales of the other products in our portfolio as a whole grew slightly and almost compensated for the decline in sales of Parkinson’s drugs. The Specialty Products business division continued to grow steadily and became Orion’s largest business division in terms of net sales. In our proprietary drugs, the intensive care sedative dexdor® and the Easyhaler® product family grew strongly. We were also pleased to receive the first marketing authorisations in Europe for Bufomix Easyhaler® in April after the review period. Also for the other business divisions, the year has started as anticipated.

“Collaboration with Janssen Pharmaceuticals in the clinical phase trial of an alpha-2c adrenoceptor antagonist (ORM-12741) being further developed for treatment of symptoms of Alzheimer's disease has commenced. As regards the androgen receptor inhibitor (ODM-201) for the treatment of prostate cancer, we are continuing preparations for a Phase III clinical trial and negotiations to find a suitable partner for collaboration on the next phase of worldwide development and commercialisation of the product.

“Our significant investment and production reorganisation projects are progressing as planned. Through the measures being undertaken, we will develop and ensure future growth, delivery reliability and quality standards. During the review period we celebrated the inauguration of the Salo plant, where we are centralising our tablet packaging and logistics functions.

“Our outlook estimate remains unchanged. We estimate that our net sales in 2014 will be at similar level to 2013 and our operating profit will be slightly lower than in 2013.”