LONDON, Sept. 8 The 2009 Frost & Sullivan Global Heart Health Ingredients Excellence in Financial & Risk Management Award is presented to Pronova BioPharma ASA. The company's first commercialised product is the first and only EU-and FDA-approved omega-3 derived prescription drug. Branded Omacor in Europe and Asia and Lovaza in the USA, the product is a prescribed adjunct to diet for the treatment of elevated levels of triglycerides in humans. In addition, Omacor/Lovaza has the approval in certain markets for treatment of the secondary prevention of post-myocardial infarction.
Pronova BioPharma has demonstrated excellence in financial management. The growth in sales in 2008 as compared to 2007 was 28.3 per cent. The company witnessed a growth of 38.5 per cent in 2009 Q1 over 2008 Q1. The total production of active pharmaceutical ingredients (API) were 615 tonnes, 918 tonnes, and 1201 tonnes, while shipments were 593 tonnes, 929 tonnes, and 1185 tonnes in 2006, 2007, and 2008, respectively. The growth in production and shipment is phenomenal and is reflective of the strong demand for Omacor/Lovaza.
Pronova BioPharma's return on assets (ROA) improved from 16.8 per cent in 2007 to 34.5 per cent in 2008. This was based on continued strong growth and commercial progress, further efficiency improvements and optimisation of manufacturing facilities at the Sandefjord plant.
"The company has dramatically improved its return on equity (ROE) and return on capital employed (ROCE) over the years 2006 to 2008; in 2006, the ROCE and ROE were a negative 3.2 per cent and negative 4.4 per cent respectively, improving to 11.2 per cent and 34.5 per cent respectively in 2008," said Shrikanth S, Senior Research Analyst and Team Leader, Business & Financial Services, Frost & Sullivan. "An outstanding business model resulting in strong operational performance coupled with excellence in working capital management has been instrumental in enhancing the company's ROCE and ROE."
Pronova BioPharma is a geographically diverse company. In 2008, US revenues accounted for 56.1 per cent of sales, while Europe accounted for 41.9 per cent of sales. This is due to a quality product served by a professional global partner network.
The company competes in a highly regulated and competitive sector. Its risk management system is based on the acknowledged ERM framework of the Committee of Sponsoring Organisations of the Treadway Commission (SOTC) to address business risks and comply with national and international regulations. The company executes strategies/tools/techniques to mitigate revenue risk, currency risk, interest rate risk, credit risk and liquidity risk.
"Pronova BioPharma has a vision to launch new areas of product application as well as new indications for its API," comments Shrikanth. "Ongoing collaborations to develop the use of its API as a monotherapy for indications such as atrial fibrillation, heart failure and as part of primary prevention of cardiac disease in type II diabetic patients are being monitored. Moreover, the company is investing in projects and preclinical studies for next generation omega-3 derived products."
Frost & Sullivan Excellence in Financial & Risk Management Award is presented to the company that best manages current market conditions, besides preparing for the future. The recipient has undertaken several risk management and mitigation practices by closely monitoring earnings per share (EPS), coverage ratios, free cash flow management, and efficient working capital management. The financial management has created or maintained an organisation that is highly efficient with its resources. To be cost-competitive, the recipient has made efforts to bring about improvements in manufacturing efficiencies by impressive growth in sales, increased margins, better return on assets (ROA), and effective debt-equity management, adding value for investors.
Frost & Sullivan Best Practices Awards recognise companies in a variety of regional and global markets for demonstrating outstanding achievement and superior performance in areas such as leadership, technological innovation, customer service, and strategic product development. Industry analysts compare market participants and measure performance through in-depth interviews, analysis, and extensive secondary research in order to identify best practices in the industry.
About Pronova BioPharma ASA
Pronova BioPharma is a global leader in the research, development and manufacture of marine-originated omega-3 derived pharmaceutical products. Pronova BioPharma's first commercialized product is branded as Omacor((R)) in a number of countries throughout Europe and Asia and as Lovaza((TM)) in the United States. The product is manufactured at the Company's plant in Sandefjord, Norway using a unique and complex process. An additional manufacturing plant is under construction in Kalundborg, Denmark and is expected to be operational in first quarter 2010.
Omacor/Lovaza is the first and only EU- and FDA-approved omega-3 derived prescription drug. The drug is prescribed as an adjunct to diet for the treatment of elevated levels of triglycerides in humans, a condition known as hypertriglyceridemia (HTG), a form of dyslipidemia (or disorder of lipid metabolism). Very high triglycerides have been linked to a number of cardiovascular diseases. Omacor is also approved in key European and certain Asian markets for the secondary prevention of post-myocardial infarction, or Post-MI, the period following the initial survival of a heart attack.
Omacor/Lovaza has been demonstrated in a number of clinical trials to be a potent triglyceride-lowering agent as a monotherapy. It has been documented to be efficacious, safe, and highly complementary to other lipid-lowering agents, such as statins. In addition, Pronova BioPharma is involved in various projects to develop Omacor/Lovaza in a number of cardiovascular indications, including as a combination therapy with statins for mixed dyslipidemia which management believe represents a major market opportunity for the Company.
Pronova BioPharma's global network of license and distribution partners includes: GlaxoSmithKline PLC (US), Takeda Pharmaceutical (Japan), Prospa (Italy) and Solvay (UK, Germany and others). The combined sales force from this network focused on the sale of Omacor/Lovaza is approximately 2,650 sales representatives.
Omacor/Lovaza was launched in 2005 in the US and in major European markets, such as France and Spain. IMS Health reports that global end-user sales of the product have increased from US$144 million in 2005 to US$778 million in 2008. The current annual run rate for end-user sales is estimated at US$953 million (as of December 2008), and the Company estimates that approximately 750,000 patients are currently on a prescription for Omacor/Lovaza.
Pronova BioPharma had revenues of NOK 1,302 million and EBITDA of NOK 603 million in 2008. The company is listed at Oslo Bors. See www.pronova.com for more information.
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