half-year report 2020 - vifor pharma · 2021. 1. 20. · vifor pharma ltd. half-year report 2020 8...

HALF-YEARREPORT2020

VIFORPHARMA

ON THE COVER

About Elena B.Elena is a Swiss radio host and a mother.

Iron deficiency significantly impacted Elena’s general well-being, leaving her feeling exhausted. “After visiting numerous doctors, I was told I was experiencing stress which I knew wasn’t possible,” she says. Eventually, Elena found a doctor who checked her ferritin levels and was told she had iron deficiency. “The effect of treatment was quick. I felt significantly better physically and I now have more energy to get on with doing the things I love.”

Elena now recognises the signs and symptoms of the condition, and proactively manages her ferritin levels by checking in with her physician on a regular basis.

Learn more about Elena’s story on our website viforpharma.com

https://www.viforpharma.com/

Vifor Pharma Ltd. Half-year Report 2020 3

TABLE OF CONTENTS

04 Letter to shareholders08 Highlights10 Our vision, mission, strategy12 Performance overview

14 OUR PRODUCTS16 Ferinject®/Injectafer®22 Nephrology23 – Mircera®23 – Retacrit®23 – Venofer®24 – Vadadustat 24 – Velphoro®25 – Rayaldee® 26 – Avacopan26 – CCX140 26 – CR845 (Difelikefalin)28 Veltassa® 30 Other products30 – Maltofer® 30 – VIT-276330 – OM Pharma

33 2020 Outlook and financial guidance

34 CONSOLIDATED INTERIM FINANCIAL STATEMENTS

36 Consolidated statement of income37 Consolidated statement of

comprehensive income38 Consolidated statement of financial position39 Consolidated statement of changes in equity40 Consolidated statement of cash flows41 Notes to the consolidated financial statements

46 Upcoming dates47 Contact information

products

Vifor Pharma Ltd. Half-year Report 20204

LETTER TO SHAREHOLDERS

“ As a result of the H1 2020 per formance, we have updated our full-year guidance, and are confident to grow our EBITDA in the range of 20% in 2020.”

STEFAN SCHULZECHIEF EXECUTIVE OFFICER

JACQUES THEURILLATCHAIRMAN OF THE BOARD OF DIRECTORS


DEAR SHAREHOLDERS,

Vifor Pharma Group delivered continued growth in the first half of 2020, despite challenges caused by the COVID-19 pandemic. Targeted measures were implemented across the organisa-tion to ensure business continuity and protect our employees, complementing our comprehen-sive resilience planning. These enabled us to avoid product shortages and to ensure continuity of supply. We are proud of the efforts of our employees and partners, and of the sophisticated network of successful collaborations which have helped minimise the consequences of the pandemic for patients who depend on our products.

Temporary challenges to patient access caused by COVID-19 measures affected product demand and net sales in H1 2020. We anticipate it will continue to have a negative impact in certain regions throughout the rest of the year. A number of initiatives to mitigate the profitability impact have been implemented and we are confident that these measures will help us to emerge from this situation even stronger.

In H1 2020, total net sales increased by 4.3%, at constant exchange rates, to CHF 922.5 million, and reported EBITDA went up by 19.8% to CHF 305.1 million compared to CHF 254.6 million in 2019.

The impact of the COVID-19 pandemic reduced revenues of Ferinject®/Injectafer® and Veltassa® in the first half of the year. However, growth was sustained in the nephrology area which was driven by the dialysis business, underlining the success of our therapeutic diversification in recent years. Vifor Pharma Group has updated its full-year guidance for 2020, with net sales expected to grow in the range of 5% at constant exchange rates, and reported EBITDA expected to grow in the range of 20%.

Patient blood management (PBM), which includes proactive identification and treatment of iron deficiency and anaemia, is a major growth area for Ferinject®/ Injectafer®. The COVID-19 pandemic significantly impacted blood donations around the world, putting patients at risk and demonstrating the importance of PBM in improving quality of treatment and ensuring security of supply for blood products. PBM was endorsed by the WHO in February 2020 as part of its strategic action framework for universal access to safe, effective and quality-assured blood products. Further significant growth opportunities for Ferinject®/Injectafer® in areas with high unmet medical need include chronic heart failure, nephrology and women’s health.

A number of lifecycle management activities continued to progress in H1 2020, to demonstrate Ferinject®’s unique safety and tolerability profile in different patient populations. Top-line results for the AFFIRM-AHF study, further evaluating the benefits of Ferinject® in heart failure, are on track and expected by the end of 2020.


LETTER TO SHAREHOLDERS

6

Vifor Pharma is committed to expanding the availability of our products worldwide, and in February 2020, we announced a strategic partnership with Fresenius Kabi, one of the top 10 multinational pharmaceutical companies in China. A new joint company will focus on the i.v. iron portfolio and PBM in China, which has the largest iron deficiency anaemia population in the world. Following phase-III trial results, a New Drug Application (NDA) submission for Ferinject® was accepted by China’s National Medical Products Administration in June 2020.

Our joint company with Fresenius Medical Care, Vifor Fresenius Medical Care Renal Pharma (VFMCRP), is the main driver of our growing and diversified nephrology portfolio. During the COVID-19 pandemic, dialysis and other potentially life-saving treatments continued to be adminis-tered to millions of chronic kidney disease (CKD) patients worldwide.

In another milestone for our portfolio, Velphoro® became a global leader by value in the phosphate binder area in H1, with in-market sales up by 53% to CHF 397 million for MAT Q1 2020. Velphoro® was launched in Canada by Otsuka Canada Pharmaceutical Inc., and in South Korea by Fresenius Medical Care in the first half of 2020.

Venofer® maintained its position as a world leading i.v. iron by volume, with almost 29 million patient years of experience by the end of June 2020.

In April 2020, VFMCRP and Cara Therapeutics announced positive results from the KALM-2 global pivotal phase-III trial in haemodialysis patients with moderate-to-severe CKD-associated pruritus, confirming the outcome of the KALM-1 study. Filing of an NDA in the US for CR845 is expected in the second half of the year.

In May 2020, together with our partner Akebia, we announced positive top-line results from the INNO²VATE studies, which evaluated the safety and efficacy of vadadustat versus darbepoetin alfa for the treatment of anaemia due to CKD in adult patients on dialysis. In February, Vifor Pharma acquired a Priority Review Voucher which, subject to agreement with Akebia, is intended to be use for the filing of vadadustat.

In June 2020, Reference Member State Germany announced the completion of the regulatory decentralised assessment procedure for Rayaldee® in our selected EU countries. National marketing authorisations are expected in countries throughout Europe in the second half of 2020.

With our continued focus on execution, we are confident that our new kidney disease therapies CR845, vadadustat, Rayaldee® and avacopan have the potential to generate significant growth, helping to further establish Vifor Pharma Group as a global leader in nephrology.

Veltassa® is our innovation for the long-term management of hyperkalaemia in chronic heart failure and CKD patients. In H1 2020, COVID-19 measures impacted the number of patients visiting nephrologist practices and face-to-face promotion was temporarily suspended, slowing new patient uptake.

We continue to invest in studies demonstrating Veltassa®’s benefits in chronic heart failure to further build market awareness and help patients with hyperkalaemia. The screening and random-isation of new patients into the DIAMOND study, designed to evaluate Veltassa® in combination with RAAS inhibitors, was temporarily discon-tinued in H1 in line with guidance issued by the FDA to minimise patient exposure to COVID-19. We have monitored the situation closely and re-initiated screening and randomisation in certain regions towards the end of June.


Reimbursement approvals for Veltassa® were received in Finland and Portugal during the first half of the year. Our partner Otsuka Canada Pharmaceutical Inc., launched Veltassa® in Canada in May. Full formulary access in England, Wales and Northern Ireland was achieved as a result of the NICE technology appraisal guidance.

In May 2020, Etienne Jornod stepped down after 25 years of highly distinguished service as Executive Chairman. We sincerely thank Etienne for his extensive contribution to Vifor Pharma’s success. His long-standing and successful leadership has been recognised by his appoint-ment as Honorary Chairman.

We are grateful to our shareholders for their confidence and support as we seek to build on Etienne’s legacy, and take up the roles of Chairman of the Board of Directors and CEO. We look forward with optimism to the future, and continue to execute on our strategy to make Vifor Pharma the global leader in iron deficiency, nephrology and cardio-renal therapies, and further develop our plans for sustained mid and long-term profitable growth.

Thank you to our employees for their continued hard work and dedication, and our shareholders for their support during these unprecedented times for our company and our communities. Vifor Pharma remains committed to delivering our company mission, helping patients around the world with severe and chronic diseases lead better, and healthier lives.

Yours sincerely,

Stefan Schulze Jacques Theurillat Chief Executive Officer Chairman of the Board of Directors

“ We are proud of the efforts of our employ-ees and partners, and of the sophisticated network of successful collabor ations which have helped minimise the consequences of the pandemic for patients who depend on our products.”


8

HIGHLIGHTS

+26.1% +4.3% –0.7 P.P.

+19.8%

+1.0% (+4.3% in local currency)

2.66CHF MILLION CHF

67.9 75.0%

1 Core earnings are defined as reported earnings after minorities adjusted for amortisation and impairment of intangible assets.

NET SALES

CORE EARNINGS PER SHARE 1

NET PROFIT AFTER MINORITIES EQUITY RATIO

EBITDA

MILLION CHF

MILLION CHF


–4.2% (–0.1% in local currency)



TOTAL FERINJECT®/INJECTAFER® NET SALES

VENOFER® NET SALES

MIRCERA®/RETACRIT® NET SALES

MILLION CHF

MILLION CHF

MILLION CHF


10

To be the global leader in iron deficiency, nephrology and cardio-renal therapies.

We strive to help patients around the world with severe and chronic diseases lead better, healthier lives.

Building on our history of global leadership in the treatment of iron deficiency, we are using our expertise in research and development, in-licensing, manufacturing, regulatory affairs and commercialisation to become a global leader in nephrology and to expand into cardio-renal therapies. By leveraging our unique competitive strengths to in-license promising new products and compounds, we are building strong partnerships. Using our in-house development expertise in iron-based therapies, we are bringing innovative products and services to patients around the world.

VISION

MISSION

STRATEGY

OUR VISION, MISSION, STRATEGY


At Vifor Pharma, our people are our most valu able resource. We strive to cultivate a unique culture within an agile business, bringing our values of Entrepreneurship, Respect and Teamwork to life. We encourage employees to make an impact in their work, and to listen to the patients we serve to achieve our vision of becoming global leader in iron deficiency, nephrol ogy and cardio- renal therapies.

In response to the COVID-19 pandemic, Vifor Pharma implemented a number of measures in the first half of the year to secure product supply for patients and protect the health and well- being of our employees and the communities in which we operate. As a company, we always seek to make a difference by offering the best possible products for patients, improving access and putting patient health and quality of life at the heart of everything we do. We are proud of the dedication of our employees in manufacturing, quality control, supply chain and many other func- tions who are working hard to ensure our medi-cines continue to reach patients and healthcare providers in these challenging times. During the first half, we took all necessary steps to protect the safety of patients and caregivers in our clinical trials, fully complying with regulatory guidance.

OUR COMPANY

Vifor Pharma is working with the European Federation of Pharmaceutical Industries and Associations (EFPIA) and other pharmaceutical companies to contribute to the fight against COVID-19. We have launched a global fund to support patient associations, inviting grant applications for initiatives focused on the chal-lenges of the pandemic, with particular emphasis on improving the health and quality of life of patients while containment measures are in place. Our Patient Advocacy team is working with patient organisations and representatives to continuously monitor the situation, offering support and guidance.

As a global pharmaceutical company, we recog-nise and actively manage our responsibilities for society and the environment. We are commit-ted to conducting business with integrity, engaging with patients, valuing our employees, caring about the environment and engaging with the communities in which we operate. By upholding these principles, we are demon-strating our determination to lead by example and to remain at the forefront of our industry.

12 Vifor Pharma Ltd. Half-year Report 2020

PERFORMANCE OVERVIEW

KEY PROFIT AND LOSS FIGURES

Vifor Pharma Group net sales increased by 1.0% to CHF 922.5 million compared to the prior period, or 4.3% on a constant currency basis, despite impact from COVID-19 restrictions. The growth was mainly driven by our renal anaemia portfolio in the dialysis segment. EBITDA increased to CHF 305.1 million compared to CHF 254.6 million in the prior period, an increase of 19.8%. Growth was primarily driven by the increase in other income combined with cost containment measures to offset the COVID-19 impact on net sales.

Other income was CHF 43.0 million compared with CHF 20.4 million in the prior period. This was primarily due to higher income from partnering activities as well as a divestment of non-core products in Spain.

Cost of sales amounted to CHF 375.9 million compared to CHF 373.3 million in the prior period. This resulted in a gross profit margin of 61.1% compared to 60.0% in H1 2019, the increase is primarily due to the other income contribution.

Marketing and distribution expenses amounted to CHF 202.3 million, down 7.4% from the prior period. The additional investments in pre-launch activities of our pipeline products were more than offset by lower cost due to COVID-19 restrictions.

Investments in R&D amounted to CHF 156.2 million compared to CHF 109.4 million in the prior period. The increase was attributable to the impairment of the CCX140 intangible asset of CHF 56.2 million.

General and administration expenses amounted to CHF 96.0 million compared to CHF 83.8 million in the prior period. The increase was driven by growth across support areas including strength-ening of legal and intellectual property capabili-ties as well as enhancement of technol ogy and systems.

The average number of permanent full-time employees (FTE) amounted to 2,733 in H1 2020, compared to 2,687 in H1 2019. This represents an increase of just 46 FTEs or 1.7% despite investments in pre-launch activities.

Depreciation, amortisation and impairment amounted to CHF 170.1 million compared to CHF 106.0 million in the prior period. Of these amounts, CHF 92.5 million and CHF 88.7 million respectively, are recorded under cost of sales. The increase of CHF 64.1 million compared to the prior period is mainly due to the aforementioned impairment of the CCX140 intangible asset.

The net financial result amounted to an expense of CHF 14.5 million compared to CHF 8.9 million in the prior period. The increase of financial expenses compared to H1 2019 is mainly due to unrealised USD foreign currency losses.

Tax expense amounted to CHF 11.3 million in H1 2020 corresponding to a low effective tax rate of 9.5% due to a one-off tax gain of CHF 6.1 million related to prior periods. The effective tax rate in the prior period amounted to 9.9%.

Net profit attributable to non-controlling interests decreased from CHF 60.9 million to CHF 38.8 million, due to the proportionate impact of impairing the CCX140 intangible asset.


Net profit after minorities for H1 2020 increased to CHF 67.9 million compared to CHF 65.2 million in the prior period.

Core earnings per share amounted to CHF 2.66 in H1 2020, an increase of 26.1% compared to CHF 2.11 in H1 2019. The increase reflects the strong EBITDA growth in H1 2020. Core earnings are defined as reported earnings after minorities adjusted for proportionate amortisation and impairment of intangible assets of CHF 104.9 million in H1 2020 (H1 2019: CHF 71.9 million).

CASH FLOWS

Cash flow from operating activities amounted to CHF +172.6 million compared to CHF +197.9 million in the prior period. The decrease is due to investments in net working capital in H1 2020.

Cash flow from investing activities amounted to CHF –152.8 million and is mainly due to the purchase of the Priority Review Voucher of CHF –107.7 million as well as upfront and mile-stone payments for in-licensing agreements of CHF –19.6 million related to Mircera®.

Cash flow from financing activities amounted to CHF –254.0 million and was mainly influenced by dividend distributions of CHF –219.6 million, whereof CHF –90.0 million was paid to Fresenius Medical Care and CHF –129.6 million was distributed to shareholders of Vifor Pharma.

FINANCIAL POSITION

Goodwill and intangible assets amounted to CHF 2,557.1 million at the end of H1 2020 compared to CHF 2,584.5 million at the end of 2019, representing 52.2% of total assets (end of 2019: 52.4%).

Financial assets amounted to CHF 636.1 million at the end of H1 2020 compared to CHF 510.3 million at the end of 2019. The increase is mainly due to the fair value gain on our equity invest-ments in ChemoCentryx Inc.

Net debt was CHF 232.9 million resulting in a net-debt-to-EBITDA ratio of 0.39 at the end of H1 2020. This is compared to net cash position of CHF 5.7 million at the end of 2019. The increase in net debt is mainly due to the dividend payment of CHF 219.6 million in H1 2020.

With CHF 3,672.8 million of shareholders’ equity, Vifor Pharma Group continues to have a strong equity ratio of 75.0% at the end of H1 2020 compared to 75.7% at the end of 2019.

KEY GROWTH DRIVERS


OUR PRODUCTS

15Vifor Pharma Ltd. Half-year Report 2020

16 Ferinject®/Injectafer®22 Nephrology23 – Mircera®23 – Retacrit®23 – Venofer®24 – Vadadustat 24 – Velphoro®25 – Rayaldee® 26 – Avacopan26 – CCX140 26 – CR845 (Difelikefalin)28 Veltassa® 30 Other products30 – Maltofer® 30 – VIT-2763

TABLE OF CONTENTS

30 – OM Pharma products


FERINJECT®/INJECTAFER®

One of our key growth drivers is our intravenous (i.v.) iron therapy, Ferinject®/Injectafer® (ferric carboxymaltose). Ferinject® is commercialised in the US under the brand name Injectafer®. Ferinject®/ Injectafer® is a world leading i.v. iron therapy, with market approval in 83 countries at the end of June 2020.

In H1 2020, Ferinject®/ Injectafer® continued to address the unmet medical need for the treatment of patients with iron deficiency and iron deficiency anaemia in key therapy areas, including chronic heart failure, patient blood management (PBM), nephrology, gastroenterology, oncology and women’s health. Up to a third of the global population is affected by iron deficiency and iron deficiency anaemia 1. Vifor Pharma is working with various stakeholders to improve global awareness about these conditions, and to expand availability of the product worldwide.

More than 13 million patient years of experience have helped to establish Ferinject®/ Injectafer® as a trusted brand in i.v. iron therapy. The product’s clinical benefits are demonstrated by its efficacy and safety data 2, which cannot be automatically extrapolated to other i.v. iron products 3 absent product-specific clinical evidence demonstrating therapeutic evidence. Due to its complexity, the US FDA has recognised ferric carboxymaltose as a nanomedicine, a complex drug which is hard to copy. Nanomedicines are specifically designed to enhance the targeted 4 delivery of iron into

1 Peyrin-Biroulet L, et al. Guidelines on the diagnosis and treatment of iron deficiency across indications: a systematic review. Am J Clin Nutr. 2015;102(6):1585-94.

2 Scott Drugs. 2018 Mar;78(4):479–493. doi: 10.1007/s40265-018-0885-7.

3 Martin-Malo ESC Heart Fail. 2019 Apr;6(2):241–253. doi: 10.1002/ehf2.12400. Epub 2019 Jan 29

4 Beshara Br J Haematol. 2003 Mar;120(5):853-9. doi: 10.1046/j.1365–2141.2003.03590.x

years of patient experience

MILLION

countries where Ferinject®/Injectafer®has been approved

APPROX.


specific parts of the body, making treatment more effective and tolerable 5.

IMPACT OF COVID-19

In H1 2020, countries around the world imposed social and economic restrictions in response to the COVID-19 pandemic, with all sectors including healthcare impacted. Sales of Ferinject®/ Injectafer® were negatively affected in Q2 and below expectations. This has been a consequence of fewer patients visiting healthcare providers, temporary closures of administration sites for i.v. iron infusion and delays in elective surgeries with i.v. iron usage as part of PBM reduced.

REPORTED NET SALES IN H1 2020

In H1 2020, net sales of Ferinject®/Injectafer® decreased to CHF 261.9 million or 4.2% from CHF 273.4 million in the same prior-year period (or –0.1% on a constant currency basis).

INJECTAFER® (US)

Injectafer® remains a leader of the i.v. iron sub-segment of the iron market in the US. In H1 2020, Vifor Pharma reported net sales of CHF 72.7 million in H1 2020, a 1.2% decrease (or an increase of 1.9% on a constant currency basis) compared to CHF 73.6 million in H1 2019. Vifor Pharma’s US partner American Regent, Inc., a member of the Daiichi-Sankyo Group, recorded net sales of USD 205.7 million in H1 2020. This was lower than planned due to reduced access to infusion clinics during the COVID-19 pandemic in H1 2020.

5 Anselmo, Bioengineering & Translational Medicine 2016; https://aiche.onlinelibrary.wiley.com/doi/pdf/10.1002/btm2.10003

Despite the impact of COVID-19 across the country, American Regent continued to expand awareness of iron deficiency anaemia during the first half of 2020, with an award-nominated direct-to-patient media campaign.

THERAPY AREAS WITH UNMET NEED

Chronic Heart FailureVifor Pharma continues to roll out initiatives in key therapy areas to expand awareness, improve diagnosis and ensure treatment of unmet medical need. These include global awareness-raising efforts on iron deficiency in chronic heart failure. The 2016 European Society of Cardiology guide-lines recommend the screening and diagnosis of iron deficiency in every newly diagnosed heart failure patient, and have included Ferinject® as the only recommended i.v. iron treatment for chronic heart failure patients with iron deficiency, with or without anaemia.

Vifor Pharma is providing grant-based support for the independent online education of health-care professionals who treat iron deficiency, with a particular focus on chronic heart failure. In the first half of 2020, over 2,000 cardiologists in key European countries have participated in these freely available educational programmes to increase their knowledge.

Patient Blood Management Patient blood management (PBM) is designed to improve surgical and medical patient outcomes by optimally managing and preserving patients’ blood, including the proactive identification and treatment of iron deficiency and iron deficiency anaemia. Vifor Pharma aims to become a key partner for hospitals and to make PBM a standard of care practice. An estimated 1.5 million patients could benefit from PBM in the EU’s five largest countries 6.

6 Vifor Pharma analysis, Q1 2020, Countries include DE, ES, FR, IT, UK

https://aiche.onlinelibrary.wiley.com/doi/pdf/10.1002/btm2.10003


The COVID-19 pandemic has had a significant impact on blood donations around the world, putting patients’ lives at risk. In H1 2020, Vifor Pharma continued to emphasise the importance of implementing PBM to improve clinical out-comes by optimally managing patients’ blood and to educate governments and healthcare providers. In addition, PBM has been recom-mended by a number of organisations around the world, including the European Centre for Disease Control 7, medical societies such as the Society for the Advancement of Blood Management (SABM), and the American Society of Anesthesiologists (ASA), which recommends following PBM principles and highlights anaemia management and iron replacement therapies as key interventions.

In February 2020, PBM was endorsed by the World Health Organisation as part of its strategic action framework for universal access to safe, effective and quality-assured blood products 8. In the UK, preoperative iron deficiency screening and treatment was incentivised by the Commis-sioning for Quality and Innovation of the NHS 9.

Nephrology In H1 2020, Vifor Pharma launched an accredited online medical education campaign to raise awareness of the risks associated with iron deficiency and the benefits of i.v. iron treatment in patients with non-dialysis dependent chronic kidney disease (ND-CKD). Vifor Pharma support-ed a Continuing Medical Education (CME) Satellite Symposium at the virtual European Renal Association-European Dialysis and Transplant Association (ERA-EDTA) meeting in June 2020

7 Shander, A. et al. (2020) The Essential Role of Patient Blood Management in a Pandemic- a Call for Action. Anesthesia& Analgesia, doi: 10.1213/ANE.0000000000004844

8 WHO Action framework to advance universal access to safe, effective and quality assured blood products 2020–2023. World Health Organization at https://www.who.int/news-room/detail/19-02-2020-who-action-framework-to- advanceuniversal-access-to-safe-effective-and-quality- assured-blood-products-2020--2023.)

9 https://www.england.nhs.uk/wp-content/uploads/2020/01/FINAL-CQUIN-20-21-Indicator-Specifications-190220.pdf

and educated nephrologists about treating iron deficiency early in patients with CKD and concomitant heart failure.

Commercial initiatives and medical education will continue throughout 2020 and beyond, and will include medical publications and a multichannel digital campaign in selected European countries. Real-world evidence generation to show im-proved health economic outcomes in patients treated with Ferinject® compared to patients treated with either oral iron or low dose iron is ongoing in France and Italy.

Women’s Health In H1 2020, Vifor Pharma supported Women Political Leaders Global Forum (WPL), in launching a gender-sensitive information toolkit, addressing the high impact of iron deficiency and iron deficiency anaemia in women. An analysis of current disease burden and management strategies shows inadequate attention, awareness and resources are currently dedicated to this issue 10. In nearly all countries, iron deficiency and iron deficiency anaemia remain a moderate to severe health risk, affecting women dispropor-tionally to men. Up to 50% of pregnant women are iron deficient, and 42% of pregnant women and 30% of non-pregnant women live with iron deficiency anaemia.

The toolkit will help policymakers by raising awareness of the impact iron deficiency and iron deficiency anaemia have on women’s health, and its adverse socio-economic effects. It will target areas for political action and propose collaborative policy responses to enable parliamentarians to address the high unmet medical need.

10 womenpoliticalleaders.org/wp-content/uploads/2020/01/WPL-Policy-Toolkit-Iron-Deficiency.pdf

https://www.who.int/news-room/detail/19-02-2020-who-action-framework-to-advance-universal-access-to-safe-effective-and-quality-assured-blood-products-2020--2023

https://www.england.nhs.uk/wp-content/uploads/2020/01/FINAL-CQUIN-20-21-Indicator-Specifications-190220.pdf

https://www.who.int/news-room/detail/19-02-2020-who-action-framework-to-advance-universal-access-to-safe-effective-and-quality-assured-blood-products-2020--2023

https://womenpoliticalleaders.org/wp-content/uploads/2020/01/WPL-Policy-Toolkit-Iron-Deficiency.pdf



GEOGRAPHIC EXPANSION

China In February 2020, Vifor Pharma announced a strategic partnership with Fresenius Kabi in China, expanding its existing alliance with the Fresenius Group and gaining access to the second largest pharmaceutical market in the world. Fresenius Kabi is among the top 10 multinational pharmaceutical companies in China, being a market leader in clinical nutrition, anaesthesia and nephrology. As part of the agreement, Vifor Pharma and Fresenius Kabi created a joint company to focus on marketing, market access and medical affairs activities for Vifor Pharma’s i.v. iron portfolio. The joint com pany is 55% owned by Vifor Pharma and 45% by Fresenius Kabi.

The focus of the partnership will be on PBM to benefit both patients and the healthcare system in China, with an estimated 3–5 million patients undergoing elective surgery each year. Fresenius Kabi will be fully responsible for the commercial-isation of Vifor Pharma’s i.v. iron portfolio, covering more than 20,000 anaesthesiologists and 25,000 surgeons in more than 2,000 large scale hospitals to support patient blood management (PBM), as well as working with healthcare professionals for other indications including nephrology.

There is a high unmet medical need for Vifor Pharma’s i.v. iron products in China, which has the largest iron deficiency anaemia population in the world, with an estimated prevalence of 20% 11. Following positive phase-III trial results, a New Drug Application (NDA) for Ferinject® was filed and the submission was accepted by China’s National Medical Products Administration (NMPA) in June 2020.

11 The Global Use of Medicine in 2019 and Outlook to 2023 (https://iqvia.com)

Japan Our partner in Japan, Zeria Pharmaceutical Co., Ltd. received the certificate of approval for the manufacture and sale of Ferinject® in 2019. In Japan, there is a significant unmet medical need in women’s health and gastroenterology. We are confident that Ferinject® will be reimbursed and successfully launched in Japan in H2 2020.

LIFE CYCLE MANAGEMENT

The AFFIRM-AHF study, conducted by Vifor Pharma, is a multi-centre, randomised, controlled trial with 1,100 patients. AFFIRM-AHF is the first study to evaluate the benefit of Ferinject® on hospitalisations and mortality in iron deficiency patients admitted for an episode of acute heart failure. Top-line results are expected by end of 2020.

Vifor Pharma’s US partner American Regent is conducting the largest study of i.v. iron in heart failure, the HEART-FID study. HEART-FID is a randomised, double-blind, multi-centre, prospect ive, placebo-controlled study involving over 3,000 patients to assess the efficacy and safety of Injectafer® in heart failure with iron deficiency and reduced ejection fraction. Due to delays from the impact of COVID-19, results are now expected in 2023.

Vifor Pharma continues to invest in clinical studies, including its own and investigator-initiated trials, to demonstrate the efficacy and safety of Ferinject®/Injectafer® in different patient groups. Significant mortality and morbidity outcome studies in chronic heart failure patients are ongoing in 2020. Previous clinical studies, such as FAIR-HF, CONFIRM-HF and EFFECT-HF, have demonstrated significant beneficial effects of Ferinject® on symptoms, quality of life and exercise capacity in chronic heart failure patients.

https://iqvia.com


NEPHROLOGY

Our diversified nephrology portfolio is built around four primary disease areas, focusing on distinct comorbid-ities and complications in chronic kidney disease (CKD) patients. This includes renal anaemia manage-ment, mineral and bone disease management, kidney function preservation and improvement and CKD-associated complications.

Our presence in the global nephrology area is primarily built around the joint company Vifor Fresenius Medical Care Renal Pharma (VFMCRP), which combines Vifor Pharma’s expertise in pharmaceuticals with the skills and infrastructure of Fresenius Medical Care. Fresenius Medical Care has access to more than 345,000 patients in its global network of around 4,000 dialysis clinics, and is the world’s leading provider of products and services for people with chronic kidney failure. The joint company’s objective is to provide a portfolio of products and innovative services addressing the major therapeutic needs of CKD patients, focusing on the nephrologist as the main specialist.

In H1 2020, the overall impact of COVID-19 on our commercial products in the nephrology portfolio has been low. During extraordinary circum-stances, dialysis and other potentially life-saving treatment solutions have remained essential for millions of chronic kidney disease patients worldwide. As a company, our priority has been to maintain continuity of product supply to serve the patients who depend on us, and progress in ongoing clinical trials in a safe environment for both patients and caregivers in accordance with health authorities’ guidance and recommen-dations.

Venofer® million patient years of experience

Velphoro® becomes a leader by value in the phosphate binder area

APPROX.


The portfolio of products which encompasses the four primary disease areas are detailed below:

RENAL ANAEMIA MANAGEMENT

ERYTHROPOIESIS-STIMULATING AGENTS (ESAs) (MIRCERA®, RETACRIT®)

VFMCRP is committed to developing treatment options for the management of severe anaemia in dialysis patients. The Erythropoiesis-Stimulating Agent (ESA) portfolio includes both long-acting and short-acting ESAs.

MIRCERA®

Mircera® (methoxy polyethylene glycol-epoetin beta) is a long-acting ESA, licensed from F. Hoffmann-La Roche AG in 2015 to treat sympto-matic anaemia associated with CKD. Vifor Pharma has exclusive rights to commercialise Mircera® in the US and its territories.

Net sales of Mircera® fell slightly in H1 2020 to CHF 268.6 million, down –2.7% compared to the prior-year period (or 0.4% on a constant currency basis). The decrease was primarily driven by exchange rate fluctuations.

RETACRIT®

Retacrit® (epoetin alfa-epbx), a short-acting ESA, is the only biosimilar ESA currently approved by the US FDA. Vifor Pharma has licensed rights from Pfizer Inc. to commercialise Retacrit® in the US dialysis and non-hospital nephrology market, enabling Vifor Pharma to offer customers a broader range of ESA treatment options for addressing patient needs.

Net sales of Retacrit® in H1 2020 amounted to CHF 24.1 million, compared to CHF 2.9 million in the prior-year period. This increase is a result of share gains in the mid-sized and independent segment.

In June 2020, Pfizer received FDA approval for the multiple-dose vial presentation of Retacrit® for the treatment of anaemia due to CKD in dialysis and non-dialysis dependent patients. Multi-dose vials are expected to be made available later in 2020.

VENOFER®

Venofer® (iron sucrose (iron (III)-hydroxide sucrose complex) is the originator intravenous (i.v.) iron sucrose product supported by wealth of clinical data and clinical experience in iron therapy for anaemic dialysis patients. During the first half of 2020, Venofer® maintained its strong position in terms of volume worldwide, with almost 29 million patient years of experience by the end of June 2020 1.

In H1 2020, net sales of Venofer® increased 4.5% (or 8.1% on a constant currency basis) to CHF 68.3 million from CHF 65.4 million in H1 2019. The majority of Venofer® sales continue to be in the US, where it holds a strong position in the haemodialysis segment.

Venofer® is a nanomedicine. Specifically, it is a colloidal solution of complex nanoparticles, consisting of an iron core surrounded by a sucrose shell. The complex structure, surface, composition, and sophisticated manufacturing of Venofer® define its individual behaviour and therefore clinical outcome. Iron sucrose similars were initially authorised under the generic regulatory pathway, however emerging scientific

1 ASR-VEN-PSUR v.36, publication date: 27 February 2020; reporting period: 2 January 2019 to 1 January 2020).

NEPHROLOGY


evidence 2, 3, 4, 5 demonstrates that iron sucrose similars can have a different efficacy and safety profile as well as a different clinical performance, when compared with Venofer®. In light of scientif-ic evidence, iron sucrose similars should not be assumed to be therapeutically equivalent to Venofer®. Without data to demonstrate equiva-lence between Venofer® and iron sucrose similars, Venofer® maintains its status as the preferred iron sucrose treatment.

VADADUSTAT IN DEVELOPMENT

Vadadustat is an oral hypoxia-inducible factor (HIF) prolyl hydroxylase inhibitor. It is currently in global phase-III development by Akebia Thera-peutics, Inc., a NASDAQ-listed, US bio-pharma-ceutical company, for treatment of anaemia associated with chronic kidney disease (CKD) in non-dialysis and dialysis-dependent patients.

Vifor Pharma has been granted an exclusive license to sell vadadustat to Fresenius Kidney Care dialysis centres and to specific third party dialysis organisations that together account for approximately 60% of the dialysis patients in the US. The licence, which is subject to vadadustat’s approval by the US FDA and inclusion in the Centres for Medicare and Medicaid (CMS) End-Stage Renal Disease Prospective Payment System, will also be effective during the Transi-

2 Di Francesco, T., Sublet, E., Borchard, G. (2019). Nano-medicines in clinical practice: Are colloidal iron sucrose ready-to-use intravenous solutions interchangeable? European Journal of Pharmaceutical Sciences. 131, 69–74

3 Rottembourg, J., Kadri, A., Leonard, E., Dansaert, A., Lafuma, A. (2011). Do two intravenous iron sucrose preparations have the same efficacy? Nephrology Dialysis Transplantation. 26, 3262–3267

4 Agüera, M.L, Martin-Malo, A., Alvarez-Lara, M. A.,Garcia- Montemayor, V. E., Canton, P., Soriano, S., Alijama, P. (2015) Efficiency of original versus generic intravenous Iron formulations in patients on Haemodialysis. PLOS ONE. 10, e0135967

5 Lee, E. S., Park, B. R., Kim, J.S., Choi, G.Y., Lee, J. J., Lee, I. S. (2013) Comparison of adverse event profile of intravenous iron sucrose and iron sucrose similar in postpartum and gynecologic operative patients. Current Medical Research and Opinion. 29, 141–147

tional Drug Add-on Payment Adjustment (TDAPA) two-year period that is expected to precede the ESRD bundle period.

In May 2020, Akebia announced positive top-line results from the INNO²VATE studies, which evaluated the safety and efficacy of vadadustat versus darbepoetin alfa for the treatment of anaemia due to CKD in adult patients on dialysis. In these trials, vadadustat achieved primary and key secondary efficacy endpoints, demonstrating non-inferiority to darbepoetin alfa as measured by a mean change in haemoglobin (Hb) between baseline and the primary evaluation period (weeks 24 to 36) and secondary evaluation period (weeks 40 to 52). Vadadustat also achieved its primary safety endpoint, defined as time to first occurrence of major adverse cardiovascular events (MACE). Each analysis was measured against non-inferiority margins agreed on with the US FDA.

MINERAL AND BONE MANAGEMENT

VELPHORO®

Velphoro® (Polynuclear Iron (III) – Oxyhydroxide, Sucroferric Oxyhydroxide) is a non-calcium, iron-based, chewable phosphate binder ap-proved for the control of phosphate levels in the blood in adults with CKD on dialysis. In the first half of 2020, Velphoro® became a global leader by value in the phosphate binder area 6.

Net sales of Velphoro® decreased by 8.9% (or 6.1% on a constant currency basis) in H1 2020 to CHF 73.9 million, from CHF 81.1 million in H1 2019. The decrease was mainly related to phasing impacts. Overall, strong in-market growth continues worldwide with in-market sales up by 53% to CHF 397 million for MAT Q1 2020.

6 Monthly IQVIA MIDAS panel, INSIGHT Health & DN, GERS, DLI, Farminform | 03.2020


In H1 2020, Velphoro® was launched in Canada by our partner Otsuka Canada Pharmaceutical Inc., and in South Korea by our partner Fresenius Kidney Care. An additional launch is planned in Saudi Arabia by end of this year. Vifor Fresenius Medical Care Renal Pharma is also working towards regulatory approvals in a number of South East Asian markets, including Thailand, Taiwan, Singapore, Philippines, Malaysia, Indo-nesia, India, Hong Kong and Vietnam, with planned launches in 2021. In China, a phase-III clinical trial was initiated in August 2018, and the last patient enrolled in April 2020. The study is expected to be completed in 2020.

Growing real-world evidence continues to demonstrate the benefits of Velphoro® for patients, with approximately twice as many achieving and maintaining target serum phos-phate levels with half the pill burden, when switched from other phosphate binders. This was confirmed in a two-year retrospective study published in ‘Kidney Medicine’ in March 2020 7. This real-life data also suggests a reduction in the risk for hospitalisation and an improved nutritional status, which has been associated with improved quality of life for dialysis patients.

The European Post Authorisation Safety Study – VERIFIE, which assessed the safety and effect-iveness of Velphoro® under real-life conditions was successfully completed in 2019, and the related updates to the risk management plan and the Summary of Product Characteristics (SmPC) were approved by the European regulatory authorities in May 2020. The publication of the results in a peer reviewed journal is expected in the second half of the year.

7 Coyne, D. W. et all (2020) Sucroferric Oxyhydroxide in Maintenance Hemodialysis: A Retrospective, Comparative Cohort Study. Kidney Medicine

RAYALDEE®

Rayaldee® is an orally administered, extended- release formulation of calcifediol, a prohormone of the active form of vitamin D3, for the treatment of secondary hyperparathyroidism (SHPT) in patients with CKD with vitamin D insufficiency.

In June 2020, Reference Member State Germany announced the end of the regulatory decentral-ised assessment procedure for Rayaldee® in VFMCRP’s selected EU countries. The product was concluded to be approvable, with national marketing authorisations expected in H2 2020.

A recent real-world study 8 conducted in the US found that clinical effectiveness and safety in the real-world setting is consistent with data reported from the randomised clinical trials. In contrast to nutritional and active vitamin D, only extend-ed-release calcifediol (ERC) was associated with a statistically significant decrease in PTH. Further-more, patients treated with ERC saw the greatest increase in vitamin D levels, without statistically significant impact on key safety outcomes (serum calcium and phosphate) 9.

8 Germain MJ, et al. Poster presented at ERA-EDTA Virtual Congress, 6–9 June 2020

9 Germain M et al., REAL-WORLD ASSESSMENT: CLINICAL EFFECTIVENESS AND SAFETY OF VITAMIN D THERAPIES IN ND-CKD PATIENTS. Presented at ERA-EDTA virtual annual meeting 2020

NEPHROLOGY


KIDNEY FUNCTION PRESERVATION

AVACOPAN PREPARING TO FILE

Avacopan is an orally-administered, highly selective inhibitor of the complement C5a recep-tor1 (C5aR1), which is central to the underlying inflammatory cycle that drives blood vessel damage in anti-neutrophil cytoplasmic auto-anti-body-associated vasculitis (ANCA-associated vasculitis). It is currently being developed for the treatment of orphan and rare renal diseases such as ANCA-associated vasculitis (AAV) and C3 glo-merulopathy (C3G). Previous studies had shown the clinical and patient experience benefits of selectively blocking C5aR1, which is responsible for pathophysiological pro-inflammatory re sponses.

Vifor Fresenius Medical Care Renal Pharma (VFMCRP) and its partner ChemoCentryx, Inc., announced positive topline data from the pivotal phase-III ADVOCATE trial in the treatment of ANCA-associated vasculitis in November 2019. This positive data addresses a significant unmet medical need in patients living with this long-term condition. Filing in Europe is expected before the end of 2020.

Further scientific data has been disseminated with high profile presentations by investigators at the European Nephrology (ERA-EDTA) and Rheumatology (EULAR) congresses in June 2020, as well as the first full peer reviewed publication on avacopan planned in 2020. Additionally, a Managed Access Programme continues to roll out in 2020, which will allow physicians in ADVOCATE sites in certain countries to request continued treatment with avacopan for specific ANCA- associated vasculitis patients on the basis of their medical benefit-risk assessment.

VFMCRP has a licensing agreement with Chemo-Centryx, Inc., to commercialise avacopan outside the US.

CCX140

CCX140 is an orally-administered small molecule that is a highly potent and selective inhibitor of the chemokine receptor CCR2.

Topline data of the phase-II LUMINA-1 study, which enrolled 46 focal segmental glomerulo-sclerosis (FSGS) patients with moderate-to-severe protein loss in primary or genetic FSGS, was reported in May 2020. CCX140 did not demon-strate a meaningful reduction in proteinuria relative to the control group after 12 weeks of blinded treatment.

In light of topline data from the phase-II LUMINA 1 study, CCX140 development in FSGS has been discontinued.

CONDITIONS ASSOCIATED WITH KIDNEY IMPAIRMENT AND ITS TREATMENT

CR845 (DIFELIKEFALIN) PREPARING TO FILE

CR845 (Difelikefalin), developed by Cara Thera-peutics Inc., is a peripherally-restricted kappa opioid receptor agonist which targets the body’s peripheral nervous system. It is being developed as a treatment for chronic kidney disease-associ-ated pruritus (CKD-aP), and has been specifically designed to mitigate side effects typically observed with opiates. Moderate-to-severe CKD-aP is a debilitating systemic itch that affects around 30–40% of dialysis patients. The disease is associated with poor quality of life and depres-sion, and has been identified as an independent predictor of mortality among haemodialysis patients. There are currently no approved therapies in Europe or the US for CKD-aP.


Vifor Fresenius Medical Care Renal Pharma (VFMCRP) entered into a development and licensing agreement with Cara Therapeutics Inc. in May 2018, to commercialise CR845 injection for the treatment of CKD-aP in haemodialysis patients worldwide, excluding the US, Japan and South Korea. In the US, VFMCRP and Cara Therapeutics will promote the investigational medicine to Fresenius Medical Care North America dialysis clinics under a profit-sharing arrangement.

In April 2020, VFMCRP and Cara Therapeutics announced positive results from the KALM-2 global pivotal phase-III trial, confirming the positive outcome of the KALM-1 study published in May 2019. The study showed statistically significant improvement in primary and key secondary endpoints. CR845 was generally well- tolerated, with a safety profile consistent with that seen in KALM-1 and in the rest of the CR845 clinical program in patients with CKD-aP.

A New Drug application in the US for CR845 is expected in H2 2020. This will be followed by a Marketing Authorisation Application in Europe. Subject to approvals, CR845 would be the first medicine indicated for the treatment of CKD-aP in the US and Europe.


VELTASSA®

Veltassa® (patiromer), is the first drug to offer effective and well-tolerated long term treatment of hyperkalaemia (elevated blood potassium levels) in chronic kidney disease (CKD) and chronic heart failure (CHF) patients. Hyperkalaemia is often asymptomatic and can cause abnormal heart rhythms and sudden death. The presence or risk of hyperkalaemia can be a barrier to initiating and maintaining chronic heart failure and chronic kidney disease (CKD) patients on guideline- recommended therapies such as renin-angiotensin-aldosterone system inhibitors (RAASi) treatment. 1, 2

1 Yancy C et al. American Heart Association. Guideline for the Management of Heart Failure. August 2017. Accessible via http://www.ksw-gtg.com/hfguidelines/pdfs/HFTreatment-HypertensionHFrEF.pdf

2 Ponikowski P et al. 2016 ESC Guidelines for the diagnosis and treatment of acute and chronic heart failure: The Task Force for the diagnosis and treatment of acute and chronic heart failure of the European Society of Cardiology (ESC) European Heart Journal, Volume 37, Issue 27, 14 July 2016, Pages 2129–2200

In H1 2020, Vifor Pharma continued to create awareness of the unmet medical need for the treatment of patients with hyperkalaemia and the new option to chronically manage hyperkalaemia, permitting patients to stay on an optimal dose of their life-saving RAASi medications. Growth is expected to be driven by further clinical data from ongoing life cycle management activities and disease awareness initiatives.

In line with our commitment to expand aware-ness, Vifor Pharma is proud to support people living with hyperkalaemia and to partner with the American Association of Kidney Patients (AAKP), the largest and oldest fully independent kidney patient organisation in the US. AAKP initiated a national educational ‘Are You O-K+’ campaign aimed at increasing awareness of hyperkalaemia. This national campaign, supported by Vifor Pharma as an inaugural sponsor, took place in May 2020. It is also known as National High Potassium Awareness Day. Approximately 3 million people in the US with CKD and/or Chronic heart failure are living with hyperkalaemia.

REPORTED NET SALES IN H1 2020

In H1 2020, net sales of Veltassa® totalled CHF 59.6 million compared with CHF 62.6 million in H1 2019, a decrease of –4.8% (or –1.7% on a constant currency basis).

This decrease in H1 2020 was primarily due to the fact that face-to-face promotion was temporarily suspended in light of COVID-19, slowing new patient uptake.

http://www.ksw-gtg.com/hfguidelines/pdfs/HFTreatmentHypertensionHFrEF.pdf


GLOBAL EXPANSION, REIMBURSEMENT AND REGULATORY APPROVALS

In January 2020, Veltassa® received reimburse-ment approval in Finland, followed by Portugal in March 2020. Our partner, Otsuka Canada Pharmaceutical Inc., launched Veltassa® in Canada in May 2020. Formulary access in England, Wales and Northern Ireland was fully achieved as a result of the National Institute for Health and Care Excellence (NICE) technology appraisal guidance in February 2020, despite minor delays due to COVID-19.

In Japan, Vifor Pharma concluded a licensing agreement with Zeria Pharmaceutical Co., Ltd., in 2018, granting Zeria exclusive rights to develop the necessary clinical data to support Veltassa®’s regulatory and reimbursement approval. In line with Vifor Pharma’s commitment to make Veltassa® available to patients worldwide, a phase-II trial was initiated in Japan in 2019 and completed enrolment during the first half of 2020.

LIFE CYCLE MANAGEMENT AND INVESTING IN THE FUTURE OF VELTASSA®

The DIAMOND trial is ongoing in 2020. In line with guidance issued by the FDA, enrolment of new patients was temporarily halted in the first half of the year, to minimise risk of patient exposure to COVID-19. As a result, patient recruitment for the study is expected to be delayed. Vifor Pharma has a corporate social responsibility to support necessary activities to reduce risk for patients being exposed to COVID-19 as well as being mindful of the patients underlying condition. The company continues to thoroughly evaluate the changing situation to mitigate impacts.

Vifor Pharma has invested in drug product capacity with a new manufacturing site in Portugal. The plant was certified by EU and Swiss authorities in late 2019, and will start commercial production in the second half of 2020. This addition to the Vifor Pharma manufacturing network will ensure supply for current and future demand at an improved cost.

In H1 2020, the joint commercialisation of Invokana® (canagliflozin), Janssen Pharmaceuticals Inc.’s inhibitor in CKD, was in ramp up phase with reported net sales amounting to CHF 0.9 million.


OTHER PRODUCTS

In addition to the leading intravenous iron therapies, Ferinject®/Injectafer® and Venofer®, Vifor Pharma develops and commercialises other products for iron deficiency and more recently for iron overload.

MALTOFER®

Maltofer® is the originator oral iron polymaltose complex (IPC), and plays an important role in the management of patients with iron deficiency. It is a widely accepted and well-tolerated oral iron therapy for infants, children, adolescents and pregnant women.

In H1 2020, net sales of Maltofer® increased by 6.2% compared to the prior year to CHF 31.4 million. This increase was primarily driven by strong growth in Saudi Arabia and Slovenia.

Vifor Pharma’s leading oral iron product is registered in 76 countries. In 2020, Maltofer® is expected to be launched in Sweden, Norway and Denmark, subject to marketing authorisations.

VIT-2763 IN DEVELOPMENT

Vifor Pharma is using its expertise in understanding the chemistry and biology of iron to develop VIT-2763, the first oral ferroportin inhibitor with the potential to treat diseases with ineffective erythro-poiesis and iron overload, such as beta-thalasse-mia. In June 2019, both the FDA and the EMA granted orphan drug designation for VIT-2763 in beta-thalassemia. In addition, VIT-2763 has shown promising results in a preclinical model of sickle cell disease, a condition where formation of aberrant haemoglobin causes a variety of compli-cations, including painful vaso-occlusive crisis and organ damage.

Following positive phase-I study results, Vifor Pharma initiated a phase-II trial in beta-thalassemia with the first patient first visit (FPFV) in Q2 2020. This randomised, controlled, multinational trial is being conducted in patients with non-transfusion- dependent beta-thalassemia and documented iron overload.

OM PHARMA PRODUCTS

Our OM Pharma product portfolio continued to perform well in H1 2020, despite the global impact of COVID-19. This illustrates the strong position of OM Pharma brands in countries worldwide, delivering value to a focused group of patients with high unmet medical need. The three leading products in the ID/OTx portfolio are Broncho-Vaxom®, Uro-Vaxom® and Doxium®.

Vifor Pharma has initiated an active programme with the intention to sell the business unit OM Pharma.

BRONCHO-VAXOM®

Broncho-Vaxom® (lyophilised bacterial lysates) is an extract of different bacterial species used for the treatment and prevention of recurrent respiratory infections. It stimulates the immune system and the body’s natural defences against a wide spectrum of viral and bacterial respiratory pathogens.

Net sales of Broncho-Vaxom® amounted to CHF 27.1 million in H1 2020, an increase of 25.3% compared to the previous year. This increase was driven by a significant rise in sales due to COVID-19 and a strong brand performance in key markets including Russia, Italy and Central America. In the first half of the year, greater focus on the importance of a strong and balanced immune system has helped to highlight the medical benefits of products like Broncho Vaxom®.


URO-VAXOM®

Uro-Vaxom® (lyophilised bacterial extract) is an extract of the bacterium Escherichia coli for the treatment and prevention of recurrent urinary tract infections. It stimulates the immune system and the body’s natural defences against urinary pathogens. The high medical need to prevent recurrent urinary tract infections with Uro-Vaxom® is highlighted in various international and local guidelines.

Net sales of Uro-Vaxom® in H1 2020 amounted to CHF 8.1 million, down 4.1% compared to the previous year, with Russia and South Korea driving overall brand performance.

DOXIUM®

Doxium® (calcium dobesilate) is used for the oral treatment of diabetic retinopathy, signs of chronic venous insufficiency in the lower limbs (pain, cramps, paraesthesia, oedema, stasis dermatosis), and haemorrhoidal syndrome.

Net sales of Doxium® in H1 2020 amounted to CHF 8.4 million, an decrease of 14.5% compared to the prior year. COVID-19 related impacts in China, Turkey and Brazil are the main drivers for the shortfall.


2020 OUTLOOK AND FINANCIAL GUIDANCE

2020 OUTLOOK

MARKET ACCESS

– Veltassa® partnering in China – Ferinject® launch in Japan expected in H2 2020 – Filing of avacopan for treatment of ANCA-associated vasculitis

in Europe expected before end of 2020 – Filing of CR845 in the US expected in H2 2020, followed by

the application in Europe

CLINICAL TRIALS

– AFFIRM-AHF readout expected by end of 2020 – Avacopan phase-II ACCOLADE in C3 Glomerulopathy study

readout

BUSINESS DEVELOPMENT

At least one additional in-licensing, product acquisition or corporate transaction is expected before the end of 2020.

FINANCIAL GUIDANCE

In 2020, net sales are expected to grow in the range of 5% at constant exchange rates, reported EBITDA is expected to grow in the range of 20%1.

1 Subject to no worsening of the situation due to COVID-19.

NET SALES EXPECTED GROWTH

IN THE RANGE OF

EBITDA EXPECTED TO INCREASE

IN THE RANGE OF


CONSOLIDATED INTERIM FINANCIAL STATEMENTS


TABLE OF CONTENTS

36 Consolidated statement of income37 Consolidated statement of comprehensive income38 Consolidated statement of financial position39 Consolidated statement of changes in equity40 Consolidated statement of cash flows41 Notes to the consolidated financial statements



36

CONSOLIDATED STATEMENT OF INCOME

in million CHF — unaudited figures2020

1.1.–30.6.2019

1.1.–30.6.

Net sales 922.5 913.3

Other income 43.0 20.4

Cost of sales (375.9) (373.3)

Gross profit 589.5 560.3

Marketing and distribution (202.3) (218.5)

Research and development (156.2) (109.4)

General and administration (96.0) (83.8)

Operating profit (EBIT) 135.0 148.7

› Financial income 4.8 5.9

› Financial expenses (19.3) (14.8)

Net financial result (14.5) (8.9)

Share of net result from joint venture (2.5) -

Profit before income taxes (EBT) 118.0 139.8

Income taxes (11.3) (13.8)

Net profit 106.7 126.0

Attributable to:

› Shareholders of Vifor Pharma Ltd. 67.9 65.2

› Non-controlling interests 38.8 60.9

Earnings per share in CHF

Basic earnings per share 1.05 1.00

Diluted earnings per share 1.04 1.00



37

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME


1.1.–30.6.2019

1.1.–30.6.


Hedging transactions

› Change in fair value 4.1 (4.5)

› Realised in profit or loss (0.9) 3.6

Translation differences (28.0) 4.1

Items that will be reclassified subsequently to profit or loss (24.7) 3.2

Remeasurements of the net defined benefit liability/asset (23.6) (0.2)

Change in fair value of equity securities measured through OCI 126.2 (9.5)

Income taxes (15.3) 0.7

Items that will not be reclassified to profit or loss 87.3 (9.0)

Other comprehensive income 62.6 (5.8)

Total comprehensive income 169.3 120.2

Attributable to:

› Shareholders of Vifor Pharma Ltd. 117.5 61.2

› Non-controlling interests 51.8 59.1



38

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

in million CHF — unaudited figures2020 30.6.

2019 31.12.

Cash and cash equivalents 304.7 544.9

Financial assets 2.7 0.3

Trade and other receivables 481.7 471.9

Income tax receivables 4.0 7.2

Inventories 420.2 348.6

Prepaid expenses and accrued income 48.4 34.2

Current assets 1,261.7 1,407.1

Property, plant and equipment 289.4 282.4

Right-of-use assets 62.0 68.6

Intangible assets 2,557.1 2,584.5

Investment in joint venture 24.1 -

Financial assets 636.1 510.3

Deferred tax assets 53.2 39.7

Employee benefit assets 16.0 41.7

Non-current assets 3,637.9 3,527.3

Assets 4,899.5 4,934.4

Financial liabilities 0.1 0.9

Lease liabilities 14.2 16.8

Trade and other payables 140.0 107.9

Income tax payables 78.6 89.3

Accrued expenses and deferred income 308.3 321.4

Provisions 7.4 4.9

Current liabilities 548.6 541.3

Financial liabilities 565.5 566.6

Lease liabilities 55.4 59.9

Deferred tax liabilities 46.3 20.4

Employee benefit liabilities 10.5 10.5

Provisions 0.4 0.4

Non-current liabilities 678.2 657.8

Share capital 0.7 0.7

Reserves 3,292.6 3,316.9

Equity attributable to shareholders of Vifor Pharma Ltd. 3,293.2 3,317.6

Non-controlling interests 379.5 417.8

Shareholders’ equity 3,672.8 3,735.3

Liabilities and shareholders’ equity 4,899.5 4,934.4



39

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

in million CHF — unaudited figuresShare

capitalTreasury

sharesRetained earnings

Foreign currency

translation reserves

Fair value reserves Total

Non- controlling

interestsTotal

equity

1 January 2019 0.7 (18.4) 3,249.6 (182.1) 1.4 3,051.2 312.5 3,363.7

Net profit - - 65.2 - - 65.2 60.9 126.0

Other comprehensive income - - (7.1) 4.0 (0.9) (4.0) (1.8) (5.8)

Total comprehensive income - - 58.0 4.0 (0.9) 61.2 59.1 120.2

Dividends - - (129.7) - - (129.7) (45.0) (174.7)

Transactions on treasury shares - 1.8 (2.2) - - (0.4) - (0.4)

Share-based payments - - 2.8 - - 2.8 - 2.8

30 June 2019 0.7 (16.6) 3,178.7 (178.0) 0.5 2,985.1 326.6 3,311.7

31 December 2019 0.7 (13.7) 3,519.3 (188.1) (0.6) 3,317.6 417.8 3,735.3

Net profit - - 67.9 - - 67.9 38.8 106.7

Other comprehensive income - - 74.3 (28.0) 3.2 49.6 13.0 62.6

Total comprehensive income - - 142.3 (28.0) 3.2 117.5 51.8 169.4

Dividends - - (129.9) - - (129.9) (90.0) (219.9)

Transactions on treasury shares - (7.5) (15.7) - - (23.2) - (23.2)

Share-based payments - - 11.1 - - 11.1 - 11.1

30 June 2020 0.7 (21.2) 3,527.1 (216.1) 2.7 3,293.2 379.5 3,672.8

At the Annual General Meeting held on 14 May 2020, a resolution was passed to pay a dividend of CHF 2.00 per share (previous year: CHF 2.00 per share), which corresponds to a payment of CHF 129.6 million for the financial year 2019. This was paid to the shareholders on 20 May 2020.



40

CONSOLIDATED STATEMENT OF CASH FLOWS


1.1.–30.6.2019

1.1.–30.6.


Income taxes 11.3 13.8

Depreciation, amortisation and impairment 170.1 106.0

Increase in provisions and employee benefit assets and liabilities 4.7 2.6

Net financial result 14.5 8.9

Other non-cash items 4.8 10.4

Change in trade and other receivables (20.8) (14.3)

Change in inventories (73.0) (38.3)

Change in trade and other payables 4.0 (32.8)

Change in other net current assets (26.8) 27.9

Interest received 1.2 2.3

Interest paid (2.6) (2.8)

Income tax paid (21.5) (11.9)

Cash flow from operating activities 172.6 197.9

Investments in property, plant and equipment (27.2) (19.6)

Investments in intangible assets (136.4) (58.3)

Investments in financial assets and securities - (1.0)

Proceeds from property, plant and equipment 0.2 4.0

Proceeds from intangible assets 10.7 -

Proceeds from financial assets and securities - 3.9

Cash flow from investing activities (152.8) (71.1)

Dividends paid (219.6) (174.7)

Purchase of treasury shares (25.0) (4.7)

Proceeds from financial liabilities 2.6 0.5

Repayment of financial liabilities (0.8) (15.5)

Payment of lease liabilities (11.2) (8.6)

Cash flow from financing activities (254.0) (202.9)

Effects of exchange rate changes on cash and cash equivalents (5.9) (2.7)

Decrease in cash and cash equivalents (240.2) (78.8)

Cash and cash equivalents as at 1 January 544.9 400.3

Cash and cash equivalents as at 30 June 304.7 321.5

NOTES TO THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS


These are the consolidated interim financial statements of Vifor Pharma Ltd. and its subsidiaries (together referred to as “Vifor Pharma” or “the Group”). Vifor Pharma is a pharmaceutical company focused on the development, manufacture and distribution of pharmaceutical products.

KEY EVENTS AND TRANSACTIONSThe financial position and performance of the Group was particularly affected by the following transactions during the reporting period:

(i) Vifor Pharma and Evotec form joint venture for early development in nephrologyOn 6 November 2019, Vifor Pharma and Evotec announced the launch of a 50:50 joint venture focused on the discovery and development of novel nephrology therapeutics. The initial investment from Vifor Pharma amounts to EUR 25 million to be paid over three years. The clinical and commercial costs for any successful compounds are anticipated to be shared equally by both companies, with opt-out rights at each stage based on a pre-determined profit share arrangement.

The deal closed on 14 January 2020. This joint arrangement is classified as a joint venture for which equity accounting is applied. Vifor Pharma’s share of net loss from the joint venture is presented in the statement of income below operating profit (EBIT).

(ii) Mircera® commercialisation rightsAs previously disclosed, the Group has signed an agreement with Fresenius Medical Care for the extension of the Mircera® commercialisation rights until 31 December 2020. In H1 2020, the Group exercised options for an additional USD 20.0 million to further extend the rights until 31 August 2021. The payments were capitalised and will be amortised over the additional 8-month licence term.

ABOUT THESE NOTES AND FINANCIAL STATEMENTSThe notes to these consolidated interim financial statements have been organised to help users find and understand the most relevant information. Certain information (eg, basis of preparation and scope of consolidation, amendments to IFRS, etc.) has been placed at the end of the document and cross-ref-erenced where necessary.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



1 OPERATING SEGMENTFinancial information is reported in a manner consistent with the internal reporting provided to the Board of Directors (Chief Operating Decision Maker). It is presented to the Board of Directors on an aggregate basis for evaluating financial performance and allocating resources. Vifor Pharma continues to report a single operating segment.

2 NET SALES AND OTHER INCOMEThe table below shows the disaggregation of net sales by brand.

in million CHF2020

1.1.–30.6.2019

1.1.–30.6.

Ferinject®/Injectafer® 261.9 273.4

Venofer® 68.3 65.4

Maltofer® 31.4 29.6

Mircera® 268.6 276.2

Retacrit® 24.1 2.9

Velphoro® 73.9 81.1

Veltassa® 59.6 62.6

Other Rx brands 51.5 45.3

Anti-infectives 55.8 52.7

Third-party production 27.4 24.2

Net sales 922.5 913.3

Geographic areasRevenues are attributed to countries (or regions) based on the country where the sale originates, as represented in the following table:

in million CHF

2020 1.1.–30.6. Switzerland

Europe (excluding

Switzerland) USA Rest of world Group

Net sales 80.2 211.3 516.2 114.8 922.5

Other income 8.6 12.3 0.5 21.6 43.0

Total 88.8 223.6 516.7 136.4 965.4

2019 1.1.–30.6.

Net sales 72.2 227.1 514.0 100.0 913.3

Other income 13.2 0.8 0.7 5.7 20.4

Total 85.4 227.9 514.6 105.7 933.7



3 EXPENSES BY NATURE AND RECONCILIATION TO EBITDAExpenses are presented by function in the statement of income and are presented by nature as follows:

in million CHF 2020

1.1.–30.6.2019

1.1.–30.6.

Cost of materials 214.0 207.4

Personnel expenses 266.5 265.0

Marketing and advertising expenses 50.4 62.7

Other operating expenses 129.5 143.9


Total 830.4 785.0

In May 2020, Vifor Pharma and ChemoCentryx, Inc. (CCX) announced topline data from the phase-II LUMINA-1 study of CCX140 in focal segmental glomerulosclerosis (FSGS) which did not meet its prima-ry endpoint. Development of CCX140 in FSGS will not move forward. Vifor Pharma subsequently impaired the related intangible asset with a carrying amount of CHF 56.2 million. It is included in the line depreciation, amortisation and impairment, as shown above, and in the function research and development as presented in our statement of income.

Depreciation, amortisation and impairment are allocated to expenses presented by function as follows:

in million CHF2020

1.1.–30.6.2019

1.1.–30.6.

DepreciationAmortisation and

impairment Depreciation Amortisation

Cost of sales 11.1 81.4 9.6 79.2

Marketing and distribution 4.6 0.4 4.1 0.5

Research and development 1.8 56.3 1.6 -

General and administration 11.3 3.3 10.0 1.0

Total 28.8 141.3 25.2 80.7

Reconciliation from EBIT to EBITDA

in million CHF 2020

1.1.–30.6.2019

1.1.–30.6.

Operating profit (EBIT) 135.0 148.7


EBITDA 305.1 254.6



4 FINANCIAL ASSETS AND FINANCIAL LIABILITIES MEASURED AT FAIR VALUEThe Group’s financial instruments, measured at fair value at the reporting date, are shown in the tables below.

in million CHF 2020 30.6. Level 1 Level 2 Level 3

Financial assets measured at fair value

Publicly traded securities 576.0 576.0

Derivative financial instruments 2.7 2.7

Venture funds 59.4 59.4

Financial liabilities measured at fair value


Contingent consideration liabilities from business combinations 12.2 12.2

in million CHF 2019

31.12. Level 1 Level 2 Level 3

Financial assets measured at fair value

Publicly traded securities 449.9 449.9


Venture funds 59.8 59.8

Financial liabilities measured at fair value


Contingent consideration liabilities from business combinations 12.4 12.4

The fair value of the level 3 financial assets and financial liabilities measured have not changed materially compared to the previous-year financial statements. The valuation methods applied have remained consistent.



5 OTHER DISCLOSURESVifor Pharma Ltd. is a Swiss company limited by shares with its head office in St. Gallen. The registered office is at Rechenstrasse 37, 9014 St. Gallen, Switzerland. Vifor Pharma shares are traded on the SIX Swiss Exchange under securities no. 36474934 (ISIN CH0364749348).

The Board of Directors authorised the 2020 consolidated interim financial statements for publication on 3 August 2020.

5.1 Basis of preparation and scope of consolidationThe consolidated interim financial statements have been prepared using the same accounting prin-ciples as the annual financial statements for the year ending 31 December 2019 and comply with IAS 34 Interim Financial Reporting. Several other amendments and an interpretation apply for the first time in 2020, but do not have an impact on the consolidated interim financial statements of the Group. The Group has not early adopted any other standard, interpretation or amendment that has been issued but is not yet effective.

The consolidated interim financial statements should be read in conjunction with the consolidated financial statements for the year ending 31 December 2019 as they update previously published information. More detailed information about the accounting policies is given in the notes to the consolidated financial statements for 2019.

5.2 Contingent liabilities and commitmentsVifor Pharma has entered into strategic arrangements with various companies in order to gain access to potential new products. Potential future payments may become due based on the achievement of certain milestones as defined in the collaboration agreements. The maximum amount of future commitments for such payments amounts to CHF 1,201.8 million (2019: CHF 1,847.5 million). The decrease in the maximum possible future commitments is mainly from the impairment of CCX140.

5.3 Exchange ratesThe table below shows the exchange rates against the CHF of the main currencies of relevance for the consolidated interim financial statements.

2020 30.6.

2019 31.12.

2020 30.6.

2019 30.6.

Half-year rate Year-end rate Average rate Average rate

USD 0.95 0.97 0.97 1.00

EUR 1.06 1.09 1.07 1.13

5.4 Subsequent eventsNo significant transactions occurred between 30 June 2020 and 3 August 2020, the date on which the consolidated interim financial statements were authorised for publication that would need to be disclosed.


VIFOR PHARMA

KEY CORPORATE DATES IN 2021 3 March 2021 Annual Report 2020 Analyst conference: full-year results 2020 — 6 May 2021 Annual General Meeting— 28 July 2021 Half-year Report 2021

UPCOMING DATES



ImprintVifor Pharma Group

This report is available to download at viforpharma.com

In the case of any discrepancy in the interpretation of the short version of the German texts of this report, the English text of the full version shall be authoritative.

August 2020 © Vifor Pharma Ltd.

Legal disclaimerNo part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, without previous written approval by the Vifor Pharma Group. All Vifor Pharma Group’s intellectual rights, including copyright, are reserved by the Vifor Pharma Group.

All other trademarks are the property of their respective owners.

Vifor Pharma Ltd.Rechenstrasse 379014 St. GallenSwitzerland Vifor Pharma GroupVifor Pharma Management Ltd. Flughofstrasse 61 8152 GlattbruggSwitzerland

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