Galenica : Management report 2021

Management report

Galenica Annual report 2021

Management report

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Contents Management report

1. Introduction
2. COVID-19

12	Key figures Galenica Group
14	«Products & Care» segment

1. «Logistics & IT» segment

1. Sustainability

Galenica Annual report 2021

Management report - Introduction

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Introduction

Management report

Highlights from the financial year 2021

Primary Care

28

Offers in pharmacies

Online shops

+50%

Sales growth

COVID-19

90,000

Vaccinations in Galenica Group pharmacies

The Galenica Group can look back on an extremely successful financial year 2021: consolidated net sales increased by 10.2% to CHF 3,834.7 million and the adjusted¹ operating result (EBIT) increased by 26.4% to CHF 213.1 million. The Board of Directors will propose to the Annual General Meeting a dividend of CHF 2.10 (+17%), of which CHF 1.05 will be paid from the capital contribution reserve.

This sales development was driven in particular by one-off additional sales in connection with COVID-19. The business developed very dynamically, especially in the last few months of 2021. On the one hand, the one-off additional sales in relation to COVID-19 increased again, and on the other hand, the sales of cold and flu medicines went up sharply compared to the same period of the previous year. A strong performance by the Mediservice speciality pharmacy and further market share gains in the wholesale business with physicians also contributed positively to sales growth. Once again, acquisitions of companies and products were another growth driver in the 2021 financial year. The profit from the sale of the property at the Galenica headquarters in Bern also had a positive impact on EBIT.

1. Excluding the effects of IAS 19 and IFRS 16. See chapter «Alternative performance measures».

Financial key figures

Highlights from the financial year 2021

• As of the end of 2021, more than 230,000 antigen, PCR and antibody tests and over 90,000 vaccinations were carried out in Galenica Group pharmacies.
• With 28 primary care offers, the importance of pharmacies as the first point of contact for health issues increased further.
• The linking of online and offline offers gained further momentum, for example with the online booking of test and vaccination services.
• Online sales at Amavita and Sun Store grew by 50%.
• The speciality pharmacy Mediservice saw excellent growth with new medicines for rare diseases in combination with the increasing demand for home care services.
• New and existing partnerships with healthcare providers strengthened the offering available to business (B2B) and end (B2C) customers.
• Verfora reinforced its leading position in the Swiss consumer healthcare market through acquisitions.
• Galexis gained more market share with new offers for specialist doctors and the support of medical centres.

Galenica Annual report 2021

Management report - COVID-19

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Important contribution to combating COVID-19

In 2021, the Galenica Group was once again able to demonstrate and

Management reportfurther consolidate its leading role in the Swiss healthcare system. Galenica made a key contribution to the security of procurement and supply as well as patient safety and health through its logistics services and pharmacy offerings to combat COVID-19.

In April 2021, pharmacies in Switzerland began dispensing COVID-19self-tests. The employees in logistics and the pharmacies only had a few days to prepare for one of the largest dispensing campaigns in the history of Swiss pharmacies. In addition, the self-tests were delivered to pharmacies in packs of 25, and the pharmacies had to repackage them into sets of five in order to meet official requirements.

Galenica Annual report 2021

Management report - COVID-19

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Primary Care: The pharmacy as the first point of contact for health problems

By the end of September, upon presentation of their health insurance card, people were able to receive five COVID-19self-tests per person per month; these were paid for by the federal government. Amavita and Sun Store customers were also able to have their five tests sent to their home monthly on subscription. The Galenica Group pharmacies were already offering antigen and PCR tests at the end of 2020, and antibody tests were made available in November 2021. By the end of December 2021, more than 230,000 antigen, PCR and antibody tests had been carried out in Galenica Group pharmacies. Since spring 2021, the three pharmacy formats Amavita, Sun Store and Coop Vitality have also been able to offer vaccinations against COVID-19. In Switzerland, the vaccination permit for pharmacies is regulated at cantonal level. As of the end of 2021, 190 Galenica Group pharmacies with the corresponding cantonal licence were offering COVID-19 vaccinations. In relation to this, Galenica has given more pharmacy employees special training and has adapted the capacity of some pharmacies.

In order to overcome the major logistical challenge of distributing the COVID-19 self- tests, Galexis set up separate warehouse and sales logistics functions in spring 2021, which it integrated into the regular operating processes over the course of the year under review.

The logistics companies of the Galenica Group supported the authorities in ensuring the availability of logistics services to transport vaccines in 2021, in particular Alloga in the canton of Bern and Unione Farmaceutica Distribuzione (UFD) in Ticino. As each canton determines its own COVID-19 logistics for vaccines, with the military pharmacy taking priority, the distribution concept also differs from canton to canton.

HCI Solutions also made valuable contributions to combating COVID-19 in 2021. After the medical and pharmacy software Documedis® was approved by the Federal Office of Public Health (FOPH) as a reporting solution for COVID-19 tests and vaccinations, HCI Solutions promptly programmed the necessary interfaces for the software connection. Since then, pharmacies and medical practices have been able to record information on the vaccinations and tests for their patients, print confirmations and send the corresponding data to the relevant authorities at the touch of a button.

COVID-19 in figures

• Between April and September 2021, Galexis and UFD delivered around 14 million COVID-19self-tests to Swiss pharmacies.
• In 2021, around 230,000 antigen, PCR and antibody tests were carried out at all Galenica pharmacies.
• In 2021, Galenica Group pharmacies dispensed some 8.5 million self-tests.
• Galenica's more than 190 pharmacies, which have a vaccination licence in
  18 cantons, administered more than 90,000 COVID-19 vaccinations in the year under review.