Terumo : Plasma Innovation Business Seminar Transcript (PDF 1.37 MB)

Among the information that Terumo discloses, the forward-looking statements including financial projections are based upon our assumptions using information available to us at the time and are not intended to be guarantees of future events or performance. Accordingly, it should be noted that actual results may differ from those forecasts or projections due to various factors. Factors affecting to actual results include, but are not limited to, changes in economic conditions surrounding Terumo, fluctuations of foreign exchange rates, and state of competition. The market share information in this presentation is partly derived from our own independent research. Information about products (including products currently in development) which is included in this material is not intended to constitute an advertisement or medical advice.

Terumo Corporation

The Transcript of Plasma Innovation Business Seminar on June 23, 2022

Ken Hata: Good afternoon. Welcome to Terumo IR day. I'm Ken Hata, head of Investor Relations. I really appreciate your coming today, either in person or virtually. So, this is another hybrid IR event broadcasted from Terumo Tokyo headquarters, inviting about a dozen guests physically in this room and a larger audience online.

So today we are talking a lot about our Blood and Cells Technologies businesses. Then when we do that, we will make sure we cover our new area Plasma Innovations as well. So this is another hybrid IR event. So, you might remember we did similar things back in December last year. Yes, GS 26.

So, is this the same old hybrid event? No, there is something new. Like I'm just doing right now, today we will broadcast communication all in English. So, sorry. It started with my bad English, but I will soon turn it over to our teams from the United States. So native speakers will take over, so no worries.

Then, this event will last about 2 hours. So first 90 minutes is a presentation including a video, then we have one break between. Then, followed by 30 minutes of Q&A.

So, with that, I'm going to invite Antoinette. I'm going to ask her to introduce herself and the team, then we will start. So, Antoinette-

Antoinette Gawin: Thank you. I appreciate the opportunity to speak to each of you personally today. I am Antoinette Gawin and began my career with General Electric in the financial side of the house, working with the corporate audit staff and mergers and acquisitions for a number of years before going to GE Information Services, where I led customer support, technical operations, and then transitioned into commercial leadership roles.

I spent time leading different businesses and joint ventures for GE in the utility sector, power systems, and in the automotive sector in different parts of the world before coming into the healthcare business, where I have spent the last 20 years.

Both with GE Healthcare leading marketing and strategic planning, as well as transitioning to Baxter Healthcare, where I led market access, commercial operations, and some global

1 / 38

Among the information that Terumo discloses, the forward-looking statements including financial projections are based upon our assumptions using information available to us at the time and are not intended to be guarantees of future events or performance. Accordingly, it should be noted that actual results may differ from those forecasts or projections due to various factors. Factors affecting to actual results include, but are not limited to, changes in economic conditions surrounding Terumo, fluctuations of foreign exchange rates, and state of competition. The market share information in this presentation is partly derived from our own independent research. Information about products (including products currently in development) which is included in this material is not intended to constitute an advertisement or medical advice.

transformation programs for the CEO at the time.

So, I joined Terumo approaching my 6th anniversary. So, we will share today some of the changes that we've implemented during that time and how we have evolved through COVID in our position to grow beyond.

So, I'll first introduce my executive team before I go into that strategy. So, across the chart on the top, you see first the business area leaders.

So Chetan Makam is the general manager of our Blood Center Solutions. He has a Master's in engineering and a business degree, and spent significant time with our competitor Haemonetics before joining us to build our global services business approximately four years ago.

Veerle d'Haenens is the general manager of our Therapeutic Systems business. Veerle is based in Brussels and has a bachelor's in Chemical Engineering and spent significant time with Pfizer in the pharmaceutical space before joining Terumo, leading therapeutic systems across Europe and then serving as the regional leader for Middle East Africa in Europe, and she accepted this position approximately one year ago.

Dr. Delara Motlagh is our general manager for Cell Therapy Technologies, and Delara has a Ph.D. in Physiology and Biophysics, building off of many years of scientific research before leading Baxter's cell therapy development programs. She joined Terumo five years ago and has been instrumental in building the foundation of the cell therapy business.

Dr. Cynthia Hougum has her professional training in Chemistry and spent the bulk of her career at General Electric in the plastics division, in healthcare, launching products, leading scientific

2 / 38

Among the information that Terumo discloses, the forward-looking statements including financial projections are based upon our assumptions using information available to us at the time and are not intended to be guarantees of future events or performance. Accordingly, it should be noted that actual results may differ from those forecasts or projections due to various factors. Factors affecting to actual results include, but are not limited to, changes in economic conditions surrounding Terumo, fluctuations of foreign exchange rates, and state of competition. The market share information in this presentation is partly derived from our own independent research. Information about products (including products currently in development) which is included in this material is not intended to constitute an advertisement or medical advice.

programs, and introducing digital ecosystems across that business. She joined Terumo just over three years ago to build our quality program and infrastructure and help us launch the plasma innovations business.

The next two individuals are not able to join us today. John Tanner has a diverse background in healthcare consulting and working with startups, and he leads our strategy and innovation team.

And Gene Stallone is our new research and development leader. He brings deep experience with the military and has spent many years with Medtronic in their surgical division.

Across the bottom, you see our delivery and support leaders. And I'll call out Cindy Ng, who- many chemists in the group-also began as a chemist, but quickly went to sales and worked for Roche and Danaher before joining Terumo five years ago. And her efforts have been instrumental in helping us return to growth around the world.

Chris Williams is the leader of our global manufacturing and delivery systems. He has 30 plus years of experience at Baxter, leading plants around the world, and then working with private equity companies to help build and optimize their production infrastructure and our support team.

Bon Lopez leads our human resource function. He's been with us for two years, bringing intense experience across Asia and the rest of the world, working for Novartis, Ortho Clinical, and other medical device manufacturers.

Rebecca Bortolotti is our general counsel. She joined us just one year ago and brings deep experience in intellectual property and technology transfer, critical as we grow in emerging markets. And Rusty Spinney is our Chief Financial Officer.

Rusty has many years of financial experience in the consumer and health areas and has been with Terumo 13 years, helping us transition both into the Terumo family and as we are building our growth plans along the way. So, you see a very global and deep experienced leadership team.

And that is necessary so we can build the right capabilities to operate in a very complex global healthcare environment. We've also built a method to promote internal talent and deepen our expertise in areas like government affairs and market access so that we can help shape the policies that affect the adoption of our products.

3 / 38

Among the information that Terumo discloses, the forward-looking statements including financial projections are based upon our assumptions using information available to us at the time and are not intended to be guarantees of future events or performance. Accordingly, it should be noted that actual results may differ from those forecasts or projections due to various factors. Factors affecting to actual results include, but are not limited to, changes in economic conditions surrounding Terumo, fluctuations of foreign exchange rates, and state of competition. The market share information in this presentation is partly derived from our own independent research. Information about products (including products currently in development) which is included in this material is not intended to constitute an advertisement or medical advice.

So, you heard me speak in December remotely about our Growth 26 Strategic Vision. Everything we do is anchored around serving more patients. And today, each business will highlight how we are bringing innovations to their respective areas.

And the key word here is accessible innovations. If we have great technology, but we can't get it into the hands of patients who need it, then it's a waste. So, we have built capabilities around regulatory and market access to help influence those standards of care and influence whether and how people use our products.

You'll hear about patients' unmet medical needs. As an example, there are still many people in the world who do not have access to safe blood, a simple foundation that we take for granted. And as you know, health care starts with people and purpose.

So our efforts start with our associates. And this sounds simple, but in today's environment around the world, it is more important than ever to engage your associates. If your people are not with you in spirit and heart, then it will be difficult for them to bring the best of your company to the customers and patients we ultimately serve.

This will help us earn customer loyalty and set industry standards. And those standards help us fuel growth and a continued improvement in profit.

4 / 38

Among the information that Terumo discloses, the forward-looking statements including financial projections are based upon our assumptions using information available to us at the time and are not intended to be guarantees of future events or performance. Accordingly, it should be noted that actual results may differ from those forecasts or projections due to various factors. Factors affecting to actual results include, but are not limited to, changes in economic conditions surrounding Terumo, fluctuations of foreign exchange rates, and state of competition. The market share information in this presentation is partly derived from our own independent research. Information about products (including products currently in development) which is included in this material is not intended to constitute an advertisement or medical advice.

Over the past five years, we have focused to ensure we have predictable performance and consistently deliver on our commitments to both customers and to the different stakeholders.

We've invested in growth areas and diversified beyond our traditional equipment sales. We have built infrastructure in growth areas such as Kenya, where there is a continent that still does not have access to the basics of healthcare. And you see, these elements have helped us grow across the top line. In addition, we have modernized our delivery system and our infrastructure.

This means optimizing our manufacturing footprint, implementing a common quality system across the world, and implementing digital systems for our sales and service teams that were critical for us to operate effectively during the COVID crisis.

You see, the result of this is an improvement in gross margin, which was a direct result of those efforts. We also were able to capture price from some of our software improvements around our core products. And our objective is we continue to invest three to four times that of our near competitors in R&D, and we have to capture that value in the marketplace.

5 / 38