well as other movements in capital and reserves of DKK -63 million. As a result, capital and reserves at year-end 2001 amounted to DKK 4,742 million against DKK 3,691 million at the beginning of 2001 after adjustment for a change in accounting policies in 2001. Employees At the end of 2001, the number of fulltime employees was 3,939, an increase of 759 employees compared to 2000. At the listing in 1999, Lundbecks employees were offered the opportunity of buying shares in the company. Also in 2002, Lundbeck intends to offer a similar share plan to all the Groups employees. Cipralex® approved in Sweden On 10 December 2001, the Swedish health authorities approved Lundbecks coming drug Cipralex® for treatment of depression and panic disorder. The approval was granted on the basis of an application for registration submitted by the company on 6 February 2001. The European approval will be based on the mutual recognition process with Sweden as reference country. Lundbeck expects to receive the European approval of Cipralex® before the end of the first half of 2002. In connection with the coming launch of Cipralex®, Lundbeck has greatly enlarged its sales force in Europe, bringing the number of sales representatives up to 1800 at the end of 2001. With this, Lundbeck matches the detailing resources of its competitors and, in the managements opinion, stands extremely well equipped for the coming launch of Cipralex®. Generic competition on the way The question of the expiry of the patent on the companys leading drug Cipramil® was already debated in connection with the listing of the company in June 1999. From the beginning of January 2002, citalopram will no longer have any form of compound patent protection in Europe, whereas it is protected in the USA until the end of 2004. In Europe, citalopram is still protected by a number of process patents relating to the production of the product. At the end of 2001, there were no sales of generic citalopram in the main European markets. Citalopram is protected via a number of process patents against generic competition beyond the date of expiry of the compound patent. In a situation in which the compound patent on a product like citalopram expires, a number of companies will attempt in one way or another to circumvent Lundbecks rights with a view to marketing and selling generic products of citalopram. It is Lundbecks policy to bring and pursue all such attempts before the courts. Net profit for the year DKKm 1,500 1,200 900 600 300 0 1997 1998 1999 2000 2001 % 30 24 18 12 6 0 Research and development costs DKKm 1,600 1,400 1,200 1,000 800 600 400 200 0 1997 1998 1999 2000 2001 5 0 20 15 10 % 30 25 Net profit for the year Net profit ratio Research and development costs Research costs as a % of revenue 5
A N N UA L R E P O RT 2 0 01 COMPETENCE COMMITMENT INNOVATION CIPRALEX® GROWTH
Lundbecks mission is to improve the quality of life for people suffering from psychiatric and neurol
S U P E RV I S O RY B OA R D Arne V. Jensen Lars Bruhn Peter Kürstein Sven Dyrløv Madsen Bent J
B OA R D O F M A N A G E M E N T Erik Sprunk-Jansen Lars Bang Harald Conradi-Larsen Stig Løkke P
CONTENTS Report The CNS market Lundbecks core competencies Lundbecks growth potential Competent and
R E P O RT GROUP FINANCIAL HIGHLIGHTS 1997-2001 1997 DKKm 1998 DKKm 1999 DKKm 2000 DKKm 2001 DK
Revenue and profit Lundbeck had a very satisfactory year, the Group achieving its best-ever financia
R E P O RT Investments Investments in 2001 were affected partly by the purchase of Byk Gulden Lombe
well as other movements in capital and reserves of DKK -63 million. As a result, capital and reserve
R E P O RT Suspension of Serdolect® lifted The Groups drug for treatment of schizophrenia, Serdolec
Poland, Slovakia, the Czech Republic, Hungary, Slovenia, Croatia, Bulgaria, Ukraine and Russia. The
R E P O RT Lundbeck expects to introduce Ebixa® for treatment of moderately severe to severe Alzhei
The exercise price of the option is determined on the basis of a tradeweighted average share price f
THE CNS MARKET 10
Diseases of the central nervous system affect millions of people all over the world 450 million peo
THE CNS MARKET The CNS market In 2000, the total world market for pharmaceuticals amounted to USD 3
Depression is the single disease that causes the highest number of years of life with disability CNS
T H E C N S M A R K E T P S Y C H I AT R I C D I S O R D E R S Antidepressants the largest CNS
Antidepressant sales 2000 Brandname Active Ingredient(s) Marketing Corporation(s) Sales 2000 (mUSD)
T H E C N S M A R K E T P S Y C H I AT R I C D I S O R D E R S In the American market, where cita
antipsychotic drugs. With the development of Serdolect® (sertindole), Lundbeck was once again a fron
T H E C N S M A R K E T N E U RO L O G I C A L D I S E A S E S 20 million people suffer from Alzh
In 2002, Lundbeck is going to market Ebixa® Anti-Alzheimer products value market share of class USA
T H E C N S M A R K E T N E U RO L O G I C A L D I S E A S E S Parkinsons disease affects 1% of t
World audited anti-Parkinson market by region in 2000 North America Europe Rest of world 32% 35%
LUNDBECKS CORE COMPETENCIES 22
Each year, Lundbeck invests around 20% of turnover in R&D Modern pharmaceutical research In the
LUNDBECKS CORE COMPETENCIES Lundbecks drug development organisation has the critical mass needed to
Competitive sales force A competitive sales strategy includes developing and optimising a marketing
L U N D B E C K S G ROW T H P OT E N T I A L The launch of Cipralex® will strengthen Lundbecks pos
Before the end of 2002, Cipralex® is expected to be launched in many European countries and in the U
L U N D B E C K S G ROW T H P OT E N T I A L Depression Alzheimers disease Schizophrenia Multiple
2002 2003 2004 2004+ Launch Launch PMS-studies III/NDA* III III II II/III I/II I/II Launch Launc
L U N D B E C K S G ROW T H P OT E N T I A L The main purpose in developing CEP-1347 is to slow do
Memantine is a non-competitive NMDAantagonist that has proven in clinical trials to be a safe and ef
C O M P E T E N T A N D C O M M I T T E D E M P L OY E E S Lundbeck has doubled its staff in the pa
Lundbecks many competent and committed employees have been crucial to the success of the company in
E N V I RO N M E N TA L P E R F O R M A N C E Environmental Report 2001 Lundbeck has experienced st
Lundbeck will certify its environmental management in the chemical production in accordance with ISO
E N V I RO N M E N TA L P E R F O R M A N C E Raw materials consumption Tonnes 14,000 12,000 10,000
Facilities in the UK certified In 2001, the facilities in the UK gained certification of its environ
E N V I RO N M E N TA L P E R F O R M A N C E equipment, which can be used for all the usual types
E N V I RO N M E N TA L S TAT E M E N T F RO M D E L O I T T E & TO U C H E We have been engage
L U N D B E C K S P RO D U C T S Antidepressants Cipralex®/LexaproTM (escitalopram) Indication: de
41
S H A R E H O L D E R I N F O R M AT I O N For the 2001 financial year, the companys Supervisory Bo
H. Lundbecks shares, which are listed on the Copenhagen Stock Exchange, continued to rise in 2001 wh
S H A R E H O L D E R I N F O R M AT I O N The dividend for the year will be paid automatically via
Investor Relations contact For enquiries to Investor Relations interested parties should contact: St
S H A R E H O L D E R I N F O R M AT I O N Analyst coverage Broker Analyst Contact Financial calen
Announcements from H. Lundbeck A/S in 2001 Nr. Date Subject 56 55 54 53 52 51 50 49 48 47 46 45 44
F I N A N C I A L R E P O RT 2 0 0 1 48
49
S U M M A RY F O R T H E G RO U P 1 9 9 3 - 2 0 0 1 Income statement (DKKm) Revenue Profit before r
Ratios Net profit ratio (%) Return on assets (%) Return on equity (%) R & D costs as a percentag
FINANCIAL REVIEW Changes in accounting policies Lundbeck has implemented the International Accounti
and Spain as well as Canada and Australia where increased sales and marketing efforts again result
FINANCIAL REVIEW At the end of 2001, forward exchange and option contracts had been entered into to
Depreciation and amortisation charges, which are included in the individual cost categories, totalle
FINANCIAL REVIEW Investments Lundbecks total net investments amounted to DKK 2,045 million in 2001
In 2001, Lundbeck continued its investments in improvements and expansion of the research facilities
FINANCIAL REVIEW Cash flows from financing activities amounted to DKK -119 million net, most of whi
At the end of each quarter, the invoiced amount is adjusted according to the actual size of the elem
FINANCIAL REVIEW Obligations Board of Management Other executives Options not granted Total options
January 2005. The value of the plan at the time of subscription was equivalent to 669,200 shares exc
FINANCIAL REVIEW The companys cash and cash equivalents at 31 December 2001 were DKK 1,031 million
value are recorded as financial items as they arise. The companys USD income derives primarily from
AC C O U N T I N G P O L I C I E S General The parent financial statements and the consolidated fin
Newly acquired subsidiaries are included in the income statement from the date of acquisition. Subsi
AC C O U N T I N G P O L I C I E S of raw materials, consumables and goods for resale, direct labou
Deferred tax on investments is provided depending on the companys intention of holding them. The tax
AC C O U N T I N G P O L I C I E S Financial assets Investments in subsidiaries are recognised in t
Obligations relating to the Management share option plan and other employee plans Obligations relati
70
I N C O M E S TAT E M E N T for the year ended 31 December 2001 PARENT 2000 DKKm 2001 DKKm Notes G
B A L A N C E S H E E T AT 3 1 D E C E M B E R 2 0 0 1 ASSETS PARENT 2000 DKKm 2001 DKKm Notes GRO
B A L A N C E S H E E T AT 3 1 D E C E M B E R 2 0 0 1 LIABILITIES PARENT 2000 DKKm 2001 DKKm Notes
C A S H F L OW S TAT E M E N T for the year ended 31 December 2001 GROUP Notes 2001 DKKm 2000 DKKm
S I G N AT U R E S Statement of the Supervisory Board and the Board of Management The Supervisory B
76
N OT E S 1. Revenue PARENT 2000 DKKm 2001 DKKm GROUP 2001 DKKm 2000 DKKm 295.6 2,304.7 1,167.3 28
N OT E S 2. Staff costs - continued In 2001, the company granted an additional 84,000 share options
2. Staff costs - continued Employees information: PARENT 2000 DKKm 2001 DKKm GROUP 2001 DKKm 2000 D
N OT E S 5. Finance income, net PARENT 2000 DKKm 2001 DKKm GROUP 2001 DKKm 2000 DKKm 73.9 14.3 81
6. Income tax expense PARENT 2000 DKKm 2001 DKKm GROUP 2001 DKKm 2000 DKKm 498.7 (0.5) (12.3) 85.7
N OT E S 7. Intangible and tangible assets GROUP Goodwill DKKm Product rights DKKm Other rights DKK
7. Intangible and tangible assets - continued GROUP Land and buildings DKKm Plant and machinery DKKm
N OT E S 8. Investments in subsidiaries Accumulated impairment loss DKKm Total DKKm Accumulated C
8. Investments in subsidiaries - continued Currency Nominal capital 000 Ownership H. Lundbeck AS, N
N OT E S 9. Other investments and other receivables PARENT Receivables from subsidiaries DKKm Other
12. Capital and reserves GROUP Share capital DKKm Share premium DKKm Reserve for treasury shares DKK
N OT E S 12. Capital and reserves - continued PARENT Share capital DKKm Reserve for net revaluation
13. Retirement benefit obligations Group The majority of the employees of the Group are covered by r
N OT E S 14. Deferred tax liabilities GROUP Temporary differences between assets and liabilities as
14. Deferred tax liabilities - continued PARENT Temporary differences between assets and liabilities
N OT E S 15. Non-current liabilities PARENT 2000 DKKm 2001 DKKm GROUP 2001 DKKm 2000 DKKm 14.2 1
17. Contingent liabilities Incentive plans The Group has an obligation relating to share options gra
N OT E S 18. Financial instruments Curency risk Net forward exchange contracts and currency options
18. Financial instruments - continued Currency options (zero-cost options): Contract amount calculat
N OT E S 18. Financial instruments - continued Interest rate risk The interest rate risk has been c
19. Related parties Lundbeck defines related parties as: - The companys principal shareholder, LFI A
N OT E S 21. Adjustments GROUP 2001 DKKm 2000 DKKm Depreciation and amortisation Unrealised value
23. Acquisitions of companies 2001 DKKm 2000 DKKm Acquisitions of companies: Intangible assets Tang
L U N D B E C K WO R L D W I D E For further information please see our homepage www.lundbeck.com P
Representative offices Bulgaria Hong Kong Iceland India Israel Malaysia P.R. China Russia Saudi Arab
Our vision is to become a world leader in the development of pharmaceuticals for psychiatric and neu
H. Lundbeck A/S Ottiliavej 9 DK-2500 Valby Copenhagen Tlf.: +45 3630 1311 Fax: +45 3630 1940 www.lu
