Actively managing its global supply chain
Grifols continues its efforts to increase its supply of plasma, plasma-derived therapies, SARS-CoV-2 tests and the rest of its product portfolio to ensure patients receive the treatment and care they require.
In the second quarter of 2020, Grifols' plasma collections were impacted by stay-at-home orders and social-distancing measures, among others.
Since the July-August timeframe, Grifols has witnessed a trending upward in collections in the U.S., recording steady week-on-week recovery.
In Germany, Grifols' plasma collections have shown a sooner recovery path than in the U.S. and it is expected to continue moving towards those levels reported in 2019 along second half of 2020. In China, the 40 plasma centers managed by Grifols' partner Shanghai RAAS have observed a faster recovery.
Over the last years, Grifols has built a solid network of 300 plasma centers throughout the U.S. and Germany in order to expand and diversify its access to plasma. Without a doubt, Grifols' global plasma collection network serves as a critical source of competitive advantage.
In this regard, the company continues to focus on enlarging its plasma center network via both organic and inorganic growth, while optimizing its activities.
As of today, Grifols expects full plasma volumes to recover in 2021. Through its strategic expansion plan, Grifols estimates to increase its plasma volumes by approximately 30% in 2021.
In parallel, Grifols - as well as the industry - has forged strategic partnerships with multilevel authorities and healthcare organizations to encourage plasma donations in key regions.
To this end, the U.S. government and Plasma Protein Therapeutics Association (PPTA), among others, have called upon all eligible adults to donate plasma - both recovered COVID-19 patients and those unaffected by the virus - as their plasma is needed to help save lives.
These campaigns are critical to raising awareness about the role of plasma as it remains critically important to support the needs of patients with rare and chronic diseases.
Continuous delivery of plasma-derived products
Grifols foresees strong underlying demand for its plasma-derived therapies, especially immunoglobulins including hyperimmunes and albumin. Demand in previous quarters grew at higher-than-historical rates, a trend expected to continue.
New uses and indications are expected to spark higher demand for immunoglobulins in upcoming years. At present, more than 5,000 clinical trials1 are underway around the world to further explore the treatment potential of these plasma proteins.
In recent years, Grifols has made a concerted effort to enhance its portfolio with plasma-derived product innovations, including Xembify®, VISTASEALTM and non-plasma products like TAVLESSE®. Additionally, the Bio Supplies Division has strengthened its product offering through the strategic acquisitions of IBBI and Haema.
As noted in the 2020 annual plan, as defined in the last quarter of 2019, new product launches were expected to account for roughly 30% of the year's estimated growth.
As a worldwide leader in the manufacture and distribution of immunoglobulins, Grifols remains committed to addressing the current and future needs of patients.
Towards a disease management-driven company: breakthrough innovation beyond plasma-derived therapies
In addition to its efforts to develop solutions against COVID-19, Grifols continues to promote internal and external projects as part of its integrated R&D strategy, with the overarching aim of tackling four major therapeutic areas: Immunology, Hematology, Respiratory and Neurodegenerative.
At the end of July, the scientific journal Alzheimer's & Dementia: The Journal of The Alzheimer's Association published the results of Grifols' AMBAR clinical trial, which assessed the effects of plasma protein replacement therapy in patients with mild or moderate Alzheimer's disease (AD). The findings demonstrated a slowdown in the cognitive and functional decline when plasma was replaced with albumin and immunoglobulin (plasma-derived proteins) in treated AD patients.
This publication opens new pathways to develop plasma therapies based on protein plasma exchange.
On a longer-term horizon, Grifols is supporting path-breaking research through its subsidiary Alkahest - a Silicon Valley-based biotechnology company - aimed at acquiring a thorough understanding of the human plasma proteome and its therapeutic potential to treat age-related diseases.
Grifols acquired 45% of Alkahest in 2015. Grifols, which has been collaborating with Alkahest for five years, has entered into a transaction to acquire its remaining equity.
The protein-targeted assets of Alkahest and its projects into non-plasma derived therapeutics can enable Grifols to diversify whilst still retaining its core focus in the science of plasma.
Over the last five years, Alkahest has developed and implemented a singular platform to help unlock new therapeutics and diagnostics, as well as develop new plasma proteins, new indications for currently licensed plasma proteins, biomarkers for diagnostics, and recombinant proteins and antibodies, in addition to small-molecule drugs.
Grifols is also making headway on other investee-led projects to enhance its current research pipeline. Among these initiatives, especially noteworthy, is research at GigaGen, a biopharmaceutical firm specialized in the discovery and early development of recombinant biotherapeutics.
GigaGen's research focuses on the discovery of new biological treatments by using antibodies derived from millions of cells within immune repertoires. GigaGen heads a range of in-house research projects, including the development of immuno-oncology therapies.
Grifols' support of COVID-19-related research outside the company is another important element of its integrated R+D strategy. In this regard, its investee GigaGen recently launched a large-scale production of GIGA-2025, a first-in-class recombinant hyperimmune drug for COVID-19, in collaboration with two Good Manufacturing Practice (GMP) partners. If effective, this treatment will lead to an Investigational New Drug application (IND) and Phase 1 studies on COVID-19 patients.
Robust financial management
Grifols has taken further steps to strengthen its liquidity position. As of June 30, 2020, the company's cash positions stood at EUR 878.4 million, which, when added to EUR 1,000 million in undrawn lines of credit, bring its liquidity position to roughly EUR 1,900 million.
After the refinancing process finalized in November 2019, Grifols does not face significant debt repayments until 2025. Grifols' credit ratings and outlooks by rating agencies remain unchanged.
Additionally, Grifols has implemented an operating expenses containment plan, expected to generate a positive impact of EUR 100 million on the 2020 profit and loss account.
Grifols' financial performance will be reviewed in the 2020 General Shareholders Meeting, which will be held telemetrically on October 9, 2020. Among the agenda items, shareholders will vote on the distribution of EUR 250.1 million in dividends against 2019 earnings. This allocation maintains payout at 40% of the group's consolidated net profits.
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GRIFOLS, S.A. 
