EX-99.1 3 slides.htm INVESTOR PRESENTATION slides.htm
WEST PHARMACEUTICAL SERVICES, INC.
Solutions for Injectable Drug Delivery NYSE:WST www.westpharma.com
© 2012 by West Pharmaceutical Services, Inc., Lionville, PA.
All rights reserved. This material is protected by copyright. No part of it may be reproduced, stored in a retrieval system, or transmitted in any
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trademarks and registered trademarks are property of West Pharmaceutical Services, Inc., unless noted otherwise.
CJS Securities “New Ideas for the New Year”
Conference
New York, NY
January 11, 2012
 
 

 
Safe Harbor Statement
2
Cautionary Statement Under the Private Securities Litigation Reform Act of 1995
This presentation and any accompanying management commentary contain “forward-looking statements”
as that term is defined in the Private Securities Litigation Reform Act of 1995. Such statements include,
but are not limited to statements about expected financial results for 2011 and future years.
Each of these estimates is based on preliminary information, and actual results could differ from these
preliminary estimates. We caution investors that the risk factors listed under “Cautionary Statement” in
our press releases, as well as those set forth under the caption "Risk Factors" in our most recent Annual
Report on Form 10-K as filed with the Securities and Exchange Commission and as revised or
supplemented by our quarterly reports on Form 10-Q, could cause our actual results to differ materially
from those estimated or predicted in the forward-looking statements. You should evaluate any statement
in light of these important factors. Except as required by law or regulation, we undertake no obligation to
publicly update any forward-looking statements, whether as a result of new information, future events, or
otherwise
.
Non-GAAP Financial Measures
Certain financial measures included in these presentation materials, and which may be referred to in
management’s discussion of the Company’s results and outlook, are Non-GAAP (Generally Accepted
Accounting Principles) financial measures. Non-GAAP financial measures should not be considered in
isolation or as an alternative to such measures determined in accordance with GAAP.
 
 

 
West is a globally diversified developer and manufacturer of components and
assembled systems for the packaging and delivery of injectable drugs, diagnostic
systems, and consumer products.
On average, approximately 100 million components manufactured by West and
our Global Partners are used to enhance the quality of healthcare worldwide
everyday.
Global Partners with Daikyo Seiko, Ltd. and West Pharmaceutical services Mexico, S.A. de C.V.
 
 

 
A Diverse, Stable Customer Base
(representative healthcare customers)
PHARMACEUTICAL / BIOTECHNOLOGY
6
GENERIC
MEDICAL DEVICE
 
 

 
Packaging Segment Overview
5
$840-$860
2011 Revenue Estimate
($ millions)
Packaging Systems
 Market leader
 Strong recurring revenue base
 Global manufacturing
 Steady growth in base
 Expected growth will be driven
 by: added value per unit sold;
 geographic expansion; and
 growth in key therapeutic
 segments
 
 

 
6





Value-Added Product Strategy

  
Standard   High-Value
Products   Products
Revenue Opportunity ($ per unit)
Plungers and
sleeve stoppers
Stoppers
Seals
RU seals
Westar® RU
 
 

 
Delivery Systems Segment Overview
7
$340-$350
  Customer owned IP
  Project management
  Automated assembly
  Regulated products
 Proprietary Product
 Development applies those
 capabilities to:
  West-owned IP
  Multiple product platforms
focused on unmet delivery
 needs for biologics
 
 

 
8
Revenue per-unit
Consumer product
manufacturing
Medical
device
manufacturing
Mix2Vial®
CZ vials
CZ Syringes
ConfiDose®

Effect of Increasing Proprietary Device Sales

Contract Manufacturing  Proprietary Devices
Products    
SmartDose™
 
 

 
 Company: Demographics, increasing prevalence of chronic disease,
 increasing use of biologics to treat those diseases, better access to
 healthcare
Growth Drivers Intact
9
 
 
 Packaging Systems Segment
  Growth in emerging markets
  Escalating regulatory and
 quality demands
 Delivery Systems Segment
  Growth in combination
 products that promote safety,
 dosing accuracy, ease of use,
 and deliver cost savings and
 product differentiation
  Increasing awareness of
 glass quality issues
 
 
 
  Adding plants: China, India
  Expanding WestStar,
 Envision capacity, introducing
 NovoPure
 
  SmartDose
  Confidose
  Reconstitution products
  Safety syringes
  Daikyo Crystal Zenith
 products
 
 
 
 

 
 
Category
 
Key Customers
Projected
Growth
 
Diabetes
 
 
 
 
> 10 %
 
Oncology
 
 
> 10 %
 
Vaccines
 
 
> 10 %
 
Autoimmune
 
 
> 8%
 
Generics
 
 
>10%
IMS April 2010 Report; Business Insights 2009; GBI Research 2009
10
Therapeutic Category Growth Drivers
 
 

 
Recent Highlights
 First nine months of 2011:
  Sales increased 4.5%, excluding currency
  Gross and operating margin compressed by material costs, currency
  Implemented mitigating surcharge mid-year
 Updated long-term financial targets in Q3 2011 release & analyst call
 4th Quarter, Full-Year 2011 results: Release date February 16, 2012
 China rubber facility under construction
 India land lease finalized
 Demand for contract manufacturing services better than 2010
 Vetter collaboration announced for CZ filling capacity
 Glass packaging compatibility issues generating strong interest in
 alternative packaging materials, especially for biologics and other
 high value drugs
11
 
 

 
Faster Growth of High-Value Products
Pharmaceutical Packaging Systems
12
 
 

 
Major Influences on Gross Margin
Factors
 
Pricing
 
Unit Volume
 
Sales mix
 
Lean mfg. savings
 
Raw material costs
 
Labor costs
 
 
Raw Material Costs
 
Comprise approximately 1/3rd of COGS
 
Materials include: Synthetic elastomer and
polymer and film (petroleum based),
aluminum, natural rubber
 
Commodity and currency volatility
 
Mitigating factors:
Cost:
 Ø Contractual terms for synthetic elastomers
 limit impact of short-term oil price changes
 and defer the impact of persistent changes
 Ø Hedging
Revenue:
 Ø Contracted sales price escalators
 Ø Material surcharges on other sales
 
13
 
 

 
2012 Outlook and Challenges
 Expect 4%-6% revenue growth in 2012, excluding currency
  Will provide more detailed expectations on February analyst call
 Pharmaceutical and Device markets:
  New product pipelines showing signs of strength
  Patent cliff front and center
  Shift to large molecule products continues
  Global shift in product sourcing (e.g., India generic growth)
  More demanding regulatory environment
 Continuing Fx and commodity price volatility
  Euro, European growth and sovereign debt
  Oil and regional political, civil and military turmoil
  Less predictable demand
14
 
 

 
15
Pharmaceutical Packaging Systems
Pharmaceutical Delivery Systems
 Strong competitive position
 Stability with growth potential
 New products well positioned to
 meet future market needs
 Financial strength to invest
 FY 2011 Year End Call February
 16 at 9:00AM
Summary
 
 

 
WEST PHARMACEUTICAL SERVICES, INC.
Solutions for Injectable Drug Delivery NYSE:WST www.westpharma.com
CJS Securities “New Ideas for the New Year”
Conference
New York, NY
January 11, 2012