![]() 1 Creating a Strong U.S. Consumer Health Care Platform December 21, 2009 Exhibit 99.2 |
![]() 2 Forward Looking Statements This presentation contains forward-looking statements. Forward-looking statements are statements that are not historical facts. These statements include financial and product development projections and estimates and their underlying assumptions, statements regarding plans, objectives, intentions and expectations with respect to future events, operations, products and services, and statements regarding future performance. Forward-looking statements are generally identified by the words “expects,” “anticipates,” “believes,” “intends,” “estimates,” “plans” and similar expressions. Although sanofi-aventis’ management believes that the expectations reflected in such forward-looking statements are reasonable, investors are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of sanofi-aventis, that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include among other things, the uncertainties inherent in research and development, future clinical data and analysis, including post marketing, decisions by regulatory authorities, such as the FDA or the EMEA, regarding whether and when to approve any drug, device or biological application that may be filed for any such product candidates as well as their decisions regarding labelling and other matters that could affect the availability or commercial potential of such products candidates, the absence of guarantee that the products candidates if approved will be commercially successful, the future approval and commercial success of therapeutic alternatives, the Group’s ability to benefit from external growth opportunities as well as those discussed or identified in the public filings with the SEC and the AMF made by sanofi-aventis, including those listed under “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements” in sanofi-aventis’ annual report on Form 20-F for the year ended December 31, 2008. Other than as required by applicable law, sanofi-aventis does not undertake any obligation to update or revise any forward-looking information or statements. Important Additional Information: The tender offer described in this presentation has not yet commenced and this presentation is neither an offer to purchase nor a solicitation of an offer to sell shares of Chattem. At the time the tender offer is commenced, River Acquisition Corp. and sanofi-aventis will file a Tender Offer Statement on Schedule TO, containing an offer to purchase, form of letter of transmittal and related tender offer documents, with the U.S. Securities and Exhange Commission (the “SEC”) and Chattem will file a Solicitation/Recommendation Statement on Schedule 14D-9 relating to the tender offer with the SEC. Sanofi- aventis and Chattem intend to mail these documents to the shareholders of Chattem. These documents will contain important information about the tender offer and shareholders of Chattem are urged to read them carefully when they become available. Shareholders of Chattem will be able to obtain a free copy of these documents, when they become available, at the website maintained by the SEC at www.sec.gov. |
![]() 3 Conference Call Participants sanofi-aventis Christopher A. Viehbacher, Chief Executive Officer Hanspeter Spek, President, Global Operations Jérôme Contamine, Executive Vice President, Chief Financial Officer Chattem Zan Guerry, Chairman and Chief Executive Officer |
![]() 4 Consumer Health Care is a Strategic Opportunity for sanofi-aventis OTC is one of our Top 5 priorities for growth OTC is a pillar of our diversified healthcare business model Key Growth Drivers Emerging markets Diabetes products Vaccines OTC New products Diversified Platforms Rx Medicines Vaccines OTC Generics Animal Health Consumer Health Care offers prospects for sustainable growth and helps offset the more volatile nature of the Rx drugs market |
![]() 5 Consumer Health Care Offers Prospects for Sustained Growth 2008 global OTC market sales at $86.6bn growing at +4.1% (1) Growing propensity to self-medicate U.S. represents around 25% of the worldwide market (1) A highly fragmented sector Top 10 companies account for close to 1/3 of OTC market sales (3) Very few truly global players External growth opportunities available Local or category acquisitions (1) Nicholas Hall's DB6 - 2008 (2) Nicholas Hall's DB6 (3) Nicholas Hall Reports based on DB6 2009 (MSP) - 2008 OTC Market Size ($bn) (2) CAGR +3.7% 0 10 20 30 40 50 60 70 80 90 |
![]() 6 13% 16% 16% 30% 13% 7% Vitamins, Minerals & Supplements Cough, Cold & Allergy Analgesics Dermatologicals Gastrointestinals Lifestyle OTCs The U.S. OTC Market is Sizeable and Attractive The world’s largest OTC market with sales of $21.1bn in 2008 (1) Sales growth of +3.3% in 2008 4 th largest per capita consumption of OTC products U.S. OTC market growth expected to be sustained at mid single digit Rx-to-OTC switches Innovative line extensions New consumer-focused products (1) Nicholas Hall's DB6 – 2008 (2) Nicholas Hall's DB6 – Mid-2009 (3) Lifestyle OTCs include Smoking Control, Sleep Aids, Eye Care, Obesity Treatment, Ear Care, Stimulants 5% Allergy Cough & Cold 6 Leading U.S. OTC Categories (2) (3) |
![]() 7 Sanofi-aventis is a growing player in Consumer Health Care Ranked #6 globally (1) OTC sales up +19.6% in 9M 2009 (2) 8 flagship OTC brands (3) growing at +9.4% (2) and accounting for 46.1% of OTC sales in 9M 2009 4 local OTC acquisitions made over the last year: Australia France The Netherlands Argentina OTC is a Dynamic Growth Area for sanofi-aventis (1) Nicholas Hall, 2008 (2) Growth at constant exchange rates (3) 8 flagship OTC brands: Doliprane ® , Essentiale ® , Enterogermina ® , Maalox ® , No Spa ® , Magne B6 ® , Lactacyd ® , Dorflex ® (4) sanofi-aventis internal estimates 4.0% 6.2% 15.2% 3.1% 4.4% 4.7% 4.8% 53.9% 3.6% Others OTC Sales % by Brands - 9M 2009 NO-SPA NO-SPA -SPA SPA OTC Sales - 2009e (4) : €1.4bn |
![]() 8 4% 46% 16% 22% 12% Sanofi-aventis Has Strong Local Presence in Selected OTC Markets ex-U.S. OTC contributes a growing percentage of sales 5.1% of pharma sales in 9M 2009 Sanofi-aventis has leading positions in 6 countries (1) France (#1), Italy (#1), Russia (#3), Australia (#1), Brazil (#2) and Mexico (#4) representing 77.4% of Group OTC sales in 9M 2009 No direct presence in the all-important U.S. Consumer Health Care market Eastern Europe Western Europe Latin America Asia Pacific Africa & Middle East OTC Sales by Regions - 9M 2009 (1) Nicholas Hall's DB6 – 2008 |
![]() 9 Switching Allegra from Rx-to-OTC in the U.S. Would Create Substantial Value Allergy Care is one of the largest and fastest growing OTC categories is an attractive switch target Robust Rx pool of over 23m TRx’s per year (1) of fexofenadine Significant estimated patient count on fexofenadine of around 7.8 m in 2008 Strong brand equity Clear regulatory framework Sanofi-aventis has other potential Rx-to-OTC switch candidates 23.0 25.4 24.7 24.3 0 5 10 15 20 25 30 2005 2006 2007 2008 Total fexofenadine U.S. TRx in million (1) (1) NPA data |
![]() 10 th Fiscal 2008 sales: $454.9m (2) 26 brands, 6 core A total of 488 employees Headquartered in Chattanooga, Tennessee 2 manufacturing plants in Chattanooga and 1 site under construction Chattem is the Largest Pure-play Company in the U.S. Consumer Health Care Market (1) Acquisition of 2 J&J OTC products: Act ® mouthwash and Balmex ® diaper cream and 3 Pfizer OTC products: Cortizone ® topical analgesic, Kaopectate ® anti-diarrheal, and the Unisom ® sleep aid (2) Fiscal year is from December 1 to November 30 A focused Consumer Health Care player with high exposure to OTC Founded in 1879 and 5 generation family led Manufacturer and marketer of a broad portfolio of Consumer Health Care brands Successful acquisition of 5 OTC brands from J&J / Pfizer in 2007 U.S. accounts for 95% of sales An ideal company for building a U.S. Consumer Healthcare platform st th |
![]() 11 5.0% 4.2% 20.5% 33.4% 7.4% 9.7% 15.2% 4.5% Chattem Has Leading Brands in Many Consumer Health Care Categories Medicated Skin Care Topical Pain Care Oral Care Medicated Dandruff Shampoos Internal OTC’s Other OTC’s International Dietary Supplements Sales by Category - 9M 2009: $353m (1) |
![]() 12 Chattem has a variety of well- recognized brands: Gold Bond ® , Icy Hot ® , ACT ® , Cortizone-10 ® , Selsun Blue ® , Unisom ® Top 6 brands represent 70% of sales Market leaders in their respective categories across food, drug and mass merchandisers 0 50 100 150 200 250 300 350 400 450 500 FY 04 FY 05 FY 06 FY 07 FY 08 FY 09e Chattem Sales ($m) (1) Chattem Offers a Unique Opportunity to Enter the All-important U.S. Consumer Health Care Market Consumer Health Care will become a 4 platform in the U.S. for sanofi-aventis with Rx medicines, Vaccines and Animal Health CAGR +12.3% (1) Fiscal Year 2009 sales consensus estimates from IBES (1) th |
![]() 13 High existing margins at the high end of peers Gross margin above peers at 69.7% for 9M 2009 Sustained A&P spend of 22.2% for 9M 2009 driving growth SG&A now below peers at 12.8% for 9M 2009 Best-in-class operating margin of 34.7% for 9M 2009 Adjusted (2) net income of $82.2m and adjusted EPS of $4.25 for fiscal 2008 Chattem has an Attractive Financial Profile Operating Margin (%) (1) (1) Datafrompublicfilingsfromeachcompanyfor2008 (2) Excludingalossonearlyextinguishmentofdebt,SFAS123Remployeestockoptionexpense,non-recurringexpensesrelatedtothevoluntaryrecallofIcyHotHeatTherapy andasettlementrelatedtoclaimsallegingpulmonaryarterialhypertensionasaresultofingestionofDexatrimproductsin1998through2003 |
![]() 14 Chattem is a Unique Value Creating Opportunity At $93.50 per share, or approximately $1.9bn, the transaction values Chattem at: The valuation is in-line with comparable Consumer Health Care transactions The acquisition of Chattem will be structured as a Cash Tender Offer The transaction is expected to lead to sales synergies and incremental value creation from Allegra ® Rx-to-OTC switch The transaction will be accretive from Year 1 Chattem’s Board of Directors has unanimously approved the transaction The transaction is expected to close in Q1 2010 (2) (1) See appendix for derivation of non-GAAP financial measures (2) Subject to the satisfaction of various conditions, including the tender of a majority of Chattem’s share capital, the receipt of regulatory approvals, and other customary closing conditions 4.8 x 2009 EV/sales (1) 13.3 x 2009 EV/EBITDA (1) |
![]() 15 A Strategic Transaction to Reinforce our Presence in the U.S. Consumer Healthcare Market The acquisition of Chattem will be an important step towards building a strong position in the U.S. Consumer Health Care market Chattem brings best-in-class margins and strong core Consumer Health Care brands The transaction also allows sanofi-aventis to keep the full value of the Allegra ® Rx-to-OTC switch in the U.S. With Chattem, sanofi-aventis aims to become the #5 OTC player globally behind J&J, GSK, Novartis and Bayer This supports our vision of becoming a global diversified healthcare leader |
![]() 16 Q&A Session |
![]() 17 Appendix - Derivation of non-GAAP Measures Enterprise Value (EV) EBITDA 2009e (3) US$159m Estimated Operating Income US$167m Estimated EBITDA US$8m Estimated Depreciation & Amortization US$1,856m Diluted Outstanding Shares (1) (19.85m) x Offer Price (US$93.50) US$2,221m EV US$365m Net Debt (2) (1) Calculation based on August 31 2009 (Q3) disclosure: 19.04m basic shares outstanding. Additional options dilution calculated based on 1.82m options outstanding with a weighted average strike price of $51.74 (2) As per August 31 2009 (Q3) disclosure, includes convertible value above par (1.29m effective shares underlying $96.3m par value 2.0% convertible based on an effective conversion price of $74.82) (3) IBES consensus estimate st st |