H. Lundbeck (LUN) 43rd Annual J.P. Morgan Healthcare Conference summary

Strategic progress and transformation

• Significant progress made on growth, pipeline sustainability, and funding over the past year, with 2024 described as transformative.

• Focused Innovator Strategy targets growth of existing assets, building a sustainable late-stage pipeline, and disciplined financial management.

• Shift from broad neuropsychiatry to specialized NeuroSpecialty and NeuroRare segments, diversifying the portfolio and emphasizing scientific differentiation.

• Strategic brands (Vyepti, Brintellix/Trintellix, Rexulti, Abilify franchise) contributed 75% of revenue, with strong double-digit growth in 9M 2024 and strategic assets growing 21%.

• Four assets are expected to be in phase III by 2026, with two already in phase III, supporting long-term growth.

Pipeline and innovation highlights

• Vyepti sales expected to triple by 2027, supported by strong commercial execution and expansion into Asian markets.

• Rexulti growth driven by new indications, especially agitation associated with dementia in Alzheimer's disease (AADAD), now representing 19% of prescriptions and expected to exceed 20%.

• Largest acquisition, bexicaserin, is phase III ready with $1.5–2 billion peak sales potential and patent life to 2041.

• Amlenetug, a first-in-class molecule for multiple system atrophy, entered phase III with $1.5–3 billion market potential.

• Eight out of nine pipeline programs are in neuro-specialty and neuro-rare, with innovative trial designs and early de-risking strategies accelerating progression.

Financial discipline and capital allocation

• Largest capital reallocation in company history (DKK 1+ billion) to fund R&D and growth, targeting 30% adjusted EBITDA and 20–25% R&D investment.

• Divestment of Trintellix back to Takeda and other structural initiatives underway, with significant cost ratio improvements expected by 2027.

• Healthy financials support ongoing business development, with $1 billion in firepower for tuck-in deals.

• R&D investment is increasing to 20-25% of revenue, supporting a robust pipeline and future growth.

• Commercial and production models are being optimized, including modifications to the Takeda Trintellix collaboration.