WEST CORPORATE OVERVIEW
Solutions for Injectable Drug Delivery
CL King “Best Ideas” Investor Conference
September 15, 2010
Donald E. Morel Jr, Ph.D.
Chairman and Chief Executive Officer
NYSE: WST
www.westpharma.com
SAFE HARBOR STATEMENT
This presentation contains forward-looking statements, within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, that are based on management’s beliefs and assumptions, current expectations, estimates and
forecasts. Statements that are not historical facts, including statements that are preceded by, followed
by, or that include, words such as “estimate,” “expect,” “intend,” “believe,” “plan,” “anticipate” and other
words and terms of similar meaning are forward-looking statements. West’s estimated or anticipated
future results, product performance or other non-historical facts are forward-looking and reflect our
current perspective on existing trends and information.
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, that are based on management’s beliefs and assumptions, current expectations, estimates and
forecasts. Statements that are not historical facts, including statements that are preceded by, followed
by, or that include, words such as “estimate,” “expect,” “intend,” “believe,” “plan,” “anticipate” and other
words and terms of similar meaning are forward-looking statements. West’s estimated or anticipated
future results, product performance or other non-historical facts are forward-looking and reflect our
current perspective on existing trends and information.
Many of the factors that will determine the Company’s future results are beyond the ability of the
Company to control or predict. These statements are subject to known or unknown risks or uncertainties,
and therefore, actual results could differ materially from past results and those expressed or implied in
any forward-looking statement. You should bear this in mind as you consider forward-looking statements.
A non-exclusive list of important factors that may affect future results may be found in West’s filings with
the Securities and Exchange Commission, including our annual report on Form 10-K and our periodic
reports on Form 10-Q and Form 8-K.
Company to control or predict. These statements are subject to known or unknown risks or uncertainties,
and therefore, actual results could differ materially from past results and those expressed or implied in
any forward-looking statement. You should bear this in mind as you consider forward-looking statements.
A non-exclusive list of important factors that may affect future results may be found in West’s filings with
the Securities and Exchange Commission, including our annual report on Form 10-K and our periodic
reports on Form 10-Q and Form 8-K.
You should evaluate any statement in light of these important factors.
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CORPORATE PROFILE
Injection Systems
Administration Systems
Crystal Zenith Syringes
Packaging Systems
• Premier partner to the pharmaceutical and
biotech industry
biotech industry
• For more than 85 years, a global leader in the
development of innovative systems for packaging
and delivery of injectable drugs:
development of innovative systems for packaging
and delivery of injectable drugs:
• Primary closure systems for therapeutics used
for both human and animal health
for both human and animal health
• Components for diagnostic and prefilled
syringe systems
syringe systems
• Devices and device sub assemblies
• Reconstitution and administration systems
• Stable, diverse customer base
• 2009 sales: $1.06 billion
• Global footprint that provides sales, technical
support, and supply chain risk mitigation for our
customers
support, and supply chain risk mitigation for our
customers
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Every day over 80 million West products enhance the quality of healthcare worldwide.
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32 Manufacturing sites
34 Sales locations
Technical centers
Partner locations
GLOBAL PRESENCE
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SALES GROWTH 2002 - 2009
Net sales in millions
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• Global economic conditions unsettled
• Global pharmaceutical revenue growth projected to be 4-6% (per
IMS) on modest unit growth
IMS) on modest unit growth
• North America growth projected at 4.5 - 5.5%
• Europe growth moderate 2-4%
• “Pharemerging” markets should grow > 10% (India,
China, Brazil)
China, Brazil)
• Managing through:
• Impact of US healthcare legislation
• Industry mergers and consolidation
• Changing customer order/inventory patterns: unpredictability
• Currency volatility
CHALLENGING BUSINESS ENVIRONMENT
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$ millions, except per share data | 2010 | 2009 |
Net Sales | $281.8 | 261.0 |
Gross Margin | 29.5% | 30.2% |
Research & Development | $5.7 | $4.7 |
Selling, General & Administrative Exp. | $45.8 | $45.1 |
Net Income | $21.7 | $19.7 |
Diluted EPS - GAAP | $0.62 | $0.57 |
Diluted EPS - Non-GAAP* | $0.64 | $0.58 |
* Second quarter 2010 diluted EPS - Non-GAAP excludes $0.02 per share for restructuring charges and tax
items. Second quarter 2009 diluted EPS - Non-GAAP excludes $0.01 per share for restructuring charges.
items. Second quarter 2009 diluted EPS - Non-GAAP excludes $0.01 per share for restructuring charges.
SECOND QUARTER RESULTS
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• Major items impacting August 3, 2010 guidance
revisions
revisions
• Currency effects (e.g., revised estimate at $1.30 /€1 vs. $1.36)
• Increased R&D spending on new product programs
• Caution regarding profitability on less predictable sales mix
• Comparative results vs. 2009
• Currency (e.g., estimated $1.30 = €1 2010 vs. $1.45 in 2009)
• Unusually strong second half of 2009
• $22 million of 2009 H1N1 sales
Second Quarter Guidance
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• Demographics
• Increasing global access to
advanced healthcare
advanced healthcare
• Generic growth
• Requirement for easy, safe,
accurate dosing
accurate dosing
• Combination product growth
• Growth in biologics and vaccines
West supplies sophisticated packaging
systems for the top 20 biologic drugs (by
sales) currently on the market.
systems for the top 20 biologic drugs (by
sales) currently on the market.
LONG-TERM BUSINESS DRIVERS
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Category | Key Customers | Projected Growth |
Diabetes | > 10 % | |
Oncology | > 10 % | |
Vaccines | > 10 % | |
Autoimmune | > 8% |
IMS April 2010 Report; Business Insights 2009; GBI Research 2009
THERAPEUTIC CATEGORY GROWTH
DRIVERS
DRIVERS
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WEST’S STRUCTURE
Packaging Systems
• 2009 sales: $776 million
• Established leadership
• High market share
• Stable growth rate
Delivery Systems
• 2009 sales: $285 million
• Proprietary devices
• Contract manufacturing
• High projected growth rate
Development
Primary Package
Administration
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PACKAGING SYSTEMS
Packaging & Device
Components
Components
• 2009 sales: $776 million
• Over 36 billion parts produced
annually
annually
Proprietary Products
• NovaPure™, Westar® RS & RU
• FluroTec®
• Envision™
Key Markets
• Vaccines
• Oncology
• Diabetes
• Autoimmune disease
• Diagnostics
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West’s Competitive Advantage:
• Unmatched expertise in drug -
material interactions
material interactions
• Market leader in packaging for
biologics
biologics
• Protected IP: Proprietary materials
and processing technology - Drug
Master File (DMF) 1546
and processing technology - Drug
Master File (DMF) 1546
• Regulatory barriers to entry:
US NDAs and ANDAs
require proof of stability
require proof of stability
• Global manufacturing footprint
• Global technical support
Pharmaceutical Packaging Systems (How drugs are contained) |
Primary Container Solutions |
• Therapeutic segment focus
• Generate incremental value per unit
• Leverage changing regulatory
environment
environment
• Optimize manufacturing productivity
• Strategic acquisitions
• Geographic expansion
• China
• India
PACKAGING SYSTEMS GROWTH STRATEGY
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Westar® RS
State-of-the-art
ready-to-sterilize
elastomer closures
Westar® RU
State-of-the-art
ready-to-use
syringe plungers
and closures
Envision™
Technically advanced,
automated vision
inspection system
NovaPure™
Unrivaled
quality…by
design
HIGH-VALUE PRODUCTS DRIVE GROWTH
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VALUE PROPOSITION
Proprietary
Products
Revenue and
Margin
Opportunity
Margin
Opportunity
Disposable Device
Disposable Device
Components
Components
Westar® RS
Mix2Vial®
NovaGuard™
éris™
Westar® RU
Standard Components
Standard Components
Consumer
Consumer
Products
Products
Packaging
Delivery
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FASTER GROWTH of HIGH-VALUE PRODUCTS
Pharmaceutical Packaging Systems
Pharmaceutical Packaging Systems
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DELIVERY SYSTEMS
Contract Manufacturing
• 2009 sales: $242 million
• Over 100 million parts produced and
assembled annually
assembled annually
Proprietary Products
• 2009 sales: $43 million
• Reconstitution, Daikyo CZ systems,
syringe safety, self-administration
syringe safety, self-administration
Synergies
• Marketing
• Engineering
• Project management
• Manufacturing
• Capacity
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• Concentrate on systems for unmet
market needs
market needs
• Build market share in multi-
component systems for drug
administration utilizing Daikyo CZ as
a platform technology
component systems for drug
administration utilizing Daikyo CZ as
a platform technology
• Production supported by existing
design, multi-material molding, and
assembly capabilities
design, multi-material molding, and
assembly capabilities
• Expand through innovation and
strategic technology acquisitions
strategic technology acquisitions
Pharmaceutical Packaging Systems |
Primary Container Solutions |
Pharmaceutical Delivery Systems |
Administration Systems |
• Therapeutic segment focus
• Generate incremental value per unit
• Leverage changing regulatory
environment
environment
• Optimize manufacturing productivity
• Strategic acquisitions
• Geographic expansion
• China
• India
DELIVERY SYSTEMS GROWTH STRATEGY
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FOUNDATION OF DELIVERY SYSTEMS
Daikyo CZ
Insert Needle
License:
Prefillable
Syringe
Systems
Insert Needle
License:
Prefillable
Syringe
Systems
Acquisition
of Plastef:
Prefillable
Syringe Safety
of Plastef:
Prefillable
Syringe Safety
Acquisition of
The Tech Group:
Manufacturing &
Engineering
The Tech Group:
Manufacturing &
Engineering
Established
Proprietary
Innovation Initiative
Proprietary
Innovation Initiative
Acquisition of
Medimop:
Administration
Systems
Medimop:
Administration
Systems
Licensing of
NovaGuard™:
Luer Syringe
Safety System
NovaGuard™:
Luer Syringe
Safety System
Acquisition of
PharmaPen:
Auto-injector
System for Self-
Administration
PharmaPen:
Auto-injector
System for Self-
Administration
2005
2006
2007
2008
2009
NovaGuard™ is a trademark of West Pharmaceutical Services, Inc.,
in the United States and other jurisdictions.
in the United States and other jurisdictions.
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2010
Acquisition of
LaMoDel
LaMoDel
INTEGRATED SOLUTIONS FOR CONTAINER,
ADMINISTRATION AND INJECTION SYSTEMS
ADMINISTRATION AND INJECTION SYSTEMS
Daikyo Crystal Zenith®
Bulk Drug
Containers
Vials &
Plastic Caps
Plastic Caps
Insert Needle
& Luer Lock
Syringes
& Luer Lock
Syringes
Cartridges
Novel Devices
Administration Systems
Injection Systems
Reconstitution
& Transfer
Systems
& Transfer
Systems
NovaGuard™
Needle Safety
Needle Safety
ConfiDose®
Auto-Injector
System
Auto-Injector
System
Eris ™
Needle Safety
Needle Safety
Crystal Zenith® is a registered trademark of Daikyo Seiko, Ltd.
ConfiDose®, NovaGuard™ and Eris™ are registered trademarks and trademarks of
West Pharmaceutical Services, Inc. in the United States and other jurisdictions.
West Pharmaceutical Services, Inc. in the United States and other jurisdictions.
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Microinfusion
System
System
LIFE CYCLE PLANNING
Bulk Drug
Vial Format
Prefillable Syringe
Auto-injector System
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From early phase bulk drug
containment to auto-injector
containment to auto-injector
DAIKYO CRYSTAL ZENITH®
INSERT NEEDLE SYRINGE
INSERT NEEDLE SYRINGE
• Pharmaceutical company benefits
• Silicone-oil free container
• Tungsten free
• Glue free
• Lower dead space
• Reduced risk associated with breakage,
waste and potential for recall
waste and potential for recall
• Auto-injector system benefits
• Consistent break-loose and glide forces
• Break resistant
• Tight dimensional tolerances
• Design flexibility of plastics
• Highest quality
• 100% vision inspection
• X-ray inspection of needle
• Automated, clean
production process
production process
Prefillable Syringe Systems
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Phase III
• Production Cell
• 4 cavity system (~3.0 MM
Annually)
Annually)
• ISO 7 (Class 10,000)
Scottsdale
Scottsdale
• Robots
• SCARA
• Needle Load, Mold off load
• 6 axis
• Part off load
• Vision (100% in line)
• X Ray (100% in line)
DAIKYO CRYSTAL ZENITH® 1mL LONG
INSERT NEEDLE SYRINGE SYSTEM
INSERT NEEDLE SYRINGE SYSTEM
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CONFIDOSE® AUTO-INJECTOR SYSTEM
• Disposable auto-injector
system
system
• 1mL long Insert needle syringe
(glass or CZ)
(glass or CZ)
• Reduces risk of glass breakage
and syringe variability issues
and syringe variability issues
• High viscosities possible
• Hidden needle and full
retraction for safety
retraction for safety
• Simple 3-step process
• Audible, visual and tactile
indicators
indicators
ConfiDose® is a registered trademark of West Pharmaceutical Services, Inc.,
in the United States and other jurisdictions.
in the United States and other jurisdictions.
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NEEDLE SAFETY SYSTEMS
• NovaGuard™ for Luer connection
• Only FDA cleared passive
system for Luer lock syringes
system for Luer lock syringes
• Eris for staked needle
• >125 million units manufactured
per year
per year
• Market leading safety system
for staked needle syringes
for staked needle syringes
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Customer evaluation ongoing
•Needle hiding
•Needlestick safety
•Drug product differentiator
SUB-Q MICROINFUSION SYSTEM
• Controlled subcutaneous delivery
of high volumes and high
viscosity
of high volumes and high
viscosity
• Prefilled cartridge, no need for
user filling
user filling
• Based on Daikyo CZ cartridge
• Compact
• Hidden needle for safety
• Single push button operation
• Fully programmable
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• Pharmaceutical Packaging Systems
• Organic growth (on average) of 3-5% per year
• Margin expansion through improved operating efficiency, product mix
• Capital investments targeted at enhanced quality and value
• Pharmaceutical Delivery Systems
• Deliver the potential of Daikyo CZ products
• Increase healthcare-consumable contract manufacturing revenue
• Grow proprietary safety and delivery system businesses
• Financial discipline
• Operating cash flow: Discretionary SG&A, R&D and capital spending
that are supported by revenue growth.
that are supported by revenue growth.
• Deliver returns on invested capital (“ROIC”) that regularly exceed
weighted average cost of capital (“WACC”)
weighted average cost of capital (“WACC”)
• Align incentives with financial performance and value creation
OUR LONG-TERM FOCUS
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Strategic Planning Goals:
• Projected 2014 sales of $0.6 billion
• Projected 2014 Operating margin: > 20%
Strategic Planning Goals:
• Projected 2014 sales of $1.0 billion
• Projected 2014 Operating margin: > 20%
Pharmaceutical Packaging Systems |
Primary Container Solutions |
Pharmaceutical Delivery Systems |
Administration Systems |
Consolidated 2014 Planning Objectives
• 2014 Sales: $1.6 billion
• 2014 Operating Margin: 19%
• 2014 Consolidated ROIC: 17%
FIVE-YEAR GROWTH OPPORTUNITY
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• Well positioned
– Substantial market share
– Proprietary technology
– Diversified customer base
– Global footprint
• Significant Growth Potential
– Strength in new product pipeline
– Preferred products for biologics
• The financial strength to invest
– Reliable operating cash flow
– Balance sheet strength
• An experienced team
Injectable Container Solutions
Advanced
Injection
Systems
Injection
Systems
Prefillable Syringe Systems
Safety and Administration
Systems
Systems
SUMMARY
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WEST CORPORATE OVERVIEW
Solutions for Injectable Drug Delivery
CL King Investor Conference
September 15, 2010
Donald E. Morel Jr, Ph.D.
Chairman and Chief Executive Officer
NYSE: WST
www.westpharma.com
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