Dechra Pharmaceuticals PLC Annual Report and Accounts for the year ended 30 June 2022
Our Strategic Growth Drivers
Pipeline
Delivery
Our pipeline is a key driver of organic growth. Over the last few years we have focused on increasing the number of novel products in development and have successfully identified a number of exciting candidates
Our Objective: Deliver our pipeline on time, at the right costs and with the expected returns. Refill the pipeline so that we get a constant flow of new products in future years.
Link to our KPIs:
1
2
3
4
5
Link to our Risks:
2
3
4
5
7
Portfolio
Focus
We are a specialist veterinary pharmaceuticals business focused on Companion Animal, Equine and Food producing Animal Products. Our portfolio is well positioned in our therapeutic focus sectors to maximise returns.
Our Objective: Maximise our net revenue by increasing market penetration, focusing on targeted therapeutic sectors within CAP, Equine, FAP and Nutrition.
Link to our KPIs:
1
2
3
4
5
Link to our Risks:
1
2
4
5
7
8
Geographical
Expansion
The animal health market in emerging countries is growing rapidly due to the demand for high quality protein and the increase in pet ownership. We have identified a number of markets that present both volume and profit opportunities in the medium to long term and we are considering various entry strategies
Our Objective: Leverage our product portfolio into new geographic regions through distribution partners, in-country presence and new new country product registrations.
Link to our KPIs:
1
2
3
4
5
Link to our Risks:
2
5
7
8
10
Acquisition
We recognise acquisitions could accelerate our expansion by providing entry into new geographies, enhancing our portfolio and giving access to new technologies. We have established well-defined criteria through which potential acquisition targets can be screened.
Our Objective: Expand our geographical footprint and/or enhance product portfolio through acquisitions.
Link to our KPIs:
2
3
6
7
Link to our Risks:
6
7
Manufacturing & Supply Chain
Our manufacturing and supply chain organisation is focussed on running our operations efficiently and to high quality standards to maintain or improve margins.
Link to our KPIs:
6
Link to our Risks:
4
10
People
Our people strategy underpins everything we do in the business. We have a well-defined plan to build talent, develop people and strengthen the Dechra culture.
Link to our KPIs:
6
7
Link to our Risks:
7
Technology
We are implementing a strong IT platform to enable us to operate efficiently and are exploring how IT can provide a source of competitive advantage.
Link to our KPIs:
3
Link to our Risks:
10
ESG
Our Sustainability strategy is fully embedded within the business. Our sustainability ambition is to 'Make a Difference' in four key areas: Our People; Our Business; Our Environment; and Our Community.
Link to our KPIs:
6
7
Link to our Risks:
7
9
10
Key to KPIs:
1
Revenue Growth2
Underlying Diluted EPS Growth3
Underlying Return on Capital Employed4
Cash Conversion5
New Product Revenue6
Lost Time Accident Frequency Rate7
Employee TurnoverKey to Risks:
1
Market Risk2
Competitor Risk3
Product Development and Launch Risk4
Supply Chain Risk5
Regulatory Risk6
Acquisition Risk7
People Risk8
Antimicrobials Regulatory Risk9
Retention of People Risk10
Climate RiskOur Strategic Progress Over the Last 5 Years
Our Strategic Growth Drivers
Pipeline
Delivery
Our Achievements
2018
- Two further poultry vaccines registered in EU: Avishield® IBH120 and ND B1
- Launch of further Amoxi-Clav dose sizes to complete range for the USA market
- Progress in co-development licensing opportunities
2019
- Entered into a number of licensing agreements, including a novel canine sedative and an equine gastrointestinal product
- A number of novel and generic registrations in EU, Mexico and rest of world
- 15 Le Vet pipeline product launches
2020
- Marboquin tablets, a CAP antibiotic, approved in USA
- Cosacthen® approved in 23 EU territories and Canada
- Akston proof of concept study commenced
2021
- Favourable results on Akston dog and cat proof of concept studies
- Entered into licensing and supply agreement for Akston cat
- Mirataz launched in EU and registered in Canada
Our Progress
2022
- Launch of Zenalpha, a novel therapeutic product that is safe and effective for sedation in dogs
- Equine Strangles vaccine launched in the EU
- Amoxi-Clav suspension launched in the US market
Portfolio
Focus
Our Achievements
2018
- Strong growth in European FAP following antibiotic product alignment and range additions
- Leveraging CAP product success to increase penetration across the Group
- Continued EU growth in Equine from market penetration and range addition
2019
- Moved key Le Vet products from distributors to Dechra companies to generate significant synergies through retention of full margin and enhancing sales focus
- FAP growth accelerating against a backdrop of declining antibiotic markets
2020
- Delivered growth across all key therapeutic sectors through educational focus
- Continued to generate significant synergies from AST Farma and Le Vet acquisition
2021
- Completed Le Vet disintermediation with final products brought back in-house in Belgium
- Second consecutive year of strong growth in all key therapeutics areas
Our Progress
2022
- All product categories delivered strong growth
- Strong organic performance in key markets driven by market growth and product penetration
Geographical
Expansion
Our Achievements
2018
- Over 80 new country registrations of existing portfolio products
- Acquisition of RxVet expanded our presence in New Zealand
- Successful establishment of the DVP International team
2019
- Expanded into Latin America via the acquisition of Laboratorios Vencofarma do Brasil Ltda (Venco)
- 43 Product registrations across Israel, South Korea, Macau, Macedonia, Malaysia, Malta, Namibia, Serbia, Ukraine, UAE and Zambia
2020
- 34 product registrations across Indonesia, South Korea, Myanmar, Nicaragua, Oman, Tanzania, Thailand, UAE, Uruguay and Vietnam
- Key endocrine brands Vetoryl, Felimazole and Zycortal® being brought back in-house in Australia and progressing through the fast track process in Brazil
2021
- Internationally received 38 approvals for key brands in new countries
- Tri-Solfen® provides a meaningful FAP presence in the Australian and New Zealand market
- Launched Vetoryl in Brazil and gained registrations for Felimazole and Zycortal
Our Progress
2022
- Launched Osphos and Zycortal in Brazil
- Established a new legal entity in South Korea
- Successful establishment of FAP business unit in Australia and New Zealand to support the launch of Tri-Solfen®
Acquisition
Our Achievements
2018
- Acquisition and successful integration of RxVet, expanding our presence in New Zealand
- Acquisition and successful initial integration of AST Farma and Le Vet, providing transformation in EU Pharmaceuticals’ portfolio and pipeline
2019
- Acquisition and successful integration of Venco
- Acquisition of trade and assets of Caledonian Holdings Ltd in New Zealand strengthening market position in Equine
2020
- Acquisition of an additional 15% of Medical Ethics Pty Ltd
- Acquisition of Ampharmco LLC in Fort Worth, Texas, a FDA registered facility
- Acquisition of worldwide rights and assets of Mirataz, a transdermal medication for cats
2021
- Acquisition of worldwide rights and assets of Osurnia, a long acting treatment of otitis externa in dogs
- Acquisition of the Australian and New Zealand marketing rights for Tri-Solfen®, completing our global rights to this novel product
- Acquisition of an additional 1.5% of Medical Ethics Pty Ltd taking our holding to 49.5%
Our Progress
2022
- Acquisition of six main products for North American market
- Acquisition of the worldwide rights to Verdinexor, branded Laverdia, a new treatment of all form and stages of canine lymphoma
Our Strategic Enablers
Manufacturing
and Supply Chain
People
Technology
ESG
Our Achievements
2018
- Progress made in Manufacturing remodelling strategy in Zagreb and Bladel
- 12 months without a lost time accident
- Completion of employee engagement survey
- Successful implementation of the Oracle project in DVP EU
2019
- Appointment of additional Non-Executive Director and Group Manufacturing & Supply Director
- Investment in manufacturing and packaging at Skipton, a new solid dose facility in Zagreb and an upgrade to the Bladel sterile facility
- Oracle ERP embedded in DVP EU
2020
- Appointment of Non-Executive Director and Chief Financial Officer
- Restructured Product Development team and created new position of Chief Scientific Officer
- Remedied internal supply issues
2021
- Appointment of Non-Executive Director, Group Manufacturing & Supply Director and Group Sustainability Director
- Improvements to supply chain and ongoing technical transfer of Dechra products into Zagreb facility
- Academy for veterinarians and veterinary nurses voted best in class in industry
- Received accreditation from Great Place to Work as ‘best place to work’
- Committed to Business Ambition for 1.5 degrees centigrade reduction and the development of Science Based Targets
- Roll out of our global employee wellbeing programme branded Thrive
Our Progress
2022
- Supply chain robust and supporting high level of growth
- Expanded Danish distribution centre, opened in April 2022
- Alison Platt appointed Chair of the Board
- Appointment of Non-Executive Director, Chief Scientific Officer and Chief Information Officer
- Commenced work on new quality management systems and to move most manufacturing sites onto a single consolidated ERP system
- Task Force on Climate-related Financial Disclosures significantly strengthened
- Inaugural Dechra climate race completed improving employee ESG engagement
Strategy in Action
Strategic Growth Driver:
Pipeline Delivery
Strategic Growth Driver:
Acquisition
Strategic Growth Driver:
Geographical Expansion
Strategic Enabler:
Technology
Strategic Enabler:
People
