Dear patients, colleagues, shareholders, and representatives from the communities where we work and which we serve,
At UCB, everything we do starts with one simple question: “How will this create value for people living with severe diseases, now and into the future?” This has never been more important than it was in 2020 – a year that reminded us all of the great things our industry can accomplish when we collaborate to tackle shared, global health challenges.
As we look back on the past twelve months, we are both incredibly proud of the resilience, adaptability, and ongoing dedication that UCB colleagues, partners, and shareholders showed in ensuring that, despite the challenges created by the COVID-19 pandemic, our commitment to patients never wavered, while our willingness to support each other and our wider communities remained a top priority. That’s why we want to open this year’s Integrated Annual Report by thanking each and every one of you who made this possible. The achievements outlined in the following pages – whether they be for people living with severe diseases, for our employees, for communities, or for the planet – would not have been possible without you.
This year’s report theme – Adapting for Better Care – captures the reality of a year full of disruption and uncertainty, in which we all learned many lessons about our industry and reflected on the role UCB can play in the wider world. We have thought a lot about how we at UCB can be better health innovators, better business leaders, and better colleagues. And most importantly, we realized that we can – and should – adapt and reinvent how we work in many different aspects, in order to seize new opportunities for future value creation.
What we achieved
2020 saw people already living with the complexities of severe diseases facing more challenges than ever before, including worries around access to care and economic challenges. Throughout the pandemic, UCB remained focused on reassuring patients’ concerns and providing new sources of support , while still delivering the solutions they needed in a timely and uninterrupted manner. This allowed us to positively impact over 3.5 million patients’ lives in 2020.
Despite the challenges created by COVID-19, UCB continued to grow our business in 2020, achieving a strong financial performance . 2020 revenue reached € 5.3 billion (+9%; +8% at CER) and net sales went up by 8% to € 5.1 billion (+7% CER), driven by the sustained growth of UCB’s key products.
Underlying profitability (adjusted EBITDA) reached € 1.4 billion (+1%; -4% CER) reflecting higher investments into the future of UCB, namely product launches and product development. Core Earnings per Share were € 5.36 after € 5.20 in 2019. In line with this performance, the Board of Directors of UCB proposes a dividend of € 1.27 per share (gross), +2%.
We continued to create value for patients , advancing our pipeline of potential solutions for severe diseases, expanding our capabilities by investing in state-of-the art scientific platforms and medical advances, and further progress on our digital business transformation journey. Our rich development pipeline, including five late-stage assets, is a demonstration of our ability to continue moving forward:
2020 also saw several key highlights in terms of future growth and launches:
Cimzia® (certolizumab pegol) was approved by the Japanese health authorities for the treatment of plaque psoriasis, psoriatic arthritis, pustular psoriasis and psoriatic erythroderma for which existing treatment methods are not sufficiently effective. This makes Cimzia® the first Fc-free, PEGylated anti-TNF treatment option now available for these patients in Japan.
We received new approvals for Vimpat® (lacosamide) in the U.S., Europe and Japan as adjunctive therapy in the treatment of primary generalized tonic-clonic seizures (PGTCS) in patients four years of age and older.
Our Phase 3b study BE RADIANT, comparing bimekizumab to secukinumab for the treatment of adults with moderate-to-severe plaque psoriasis met its primary and all secondary end points, showing superiority to secukinumab.
The U.S. Food and Drug Administration (FDA) and European Medicines Agency (EMA) accepted marketing application submissions for bimekizumab for the treatment of adults with moderate-to-severe plaque psoriasis.
We also successfully completed the acquisition of Ra Pharmaceuticals, Inc., making Ra Pharma now a wholly-owned subsidiary of UCB. This enhances our leadership potential for improving treatment options for people living with myasthenia gravis and other rare diseases. Just as exciting is our acquisition of Handl Therapeutics BV, a rapidly growing and transformative gene therapy company based in Leuven, Belgium, and our new collaboration with Lacerta Therapeutics, a U.S.-based, clinical-stage gene therapy company. Together, these will help to accelerate UCB’s ambitions in gene therapy. We have also acquired Engage Therapeutics, Inc., a clinical-stage pharmaceutical company developing Staccato® Alprazolam for the rapid termination of epileptic seizures. This product combines the Staccato® delivery technology with the established benzodiazepine alprazolam. We start the Phase 3 program in the second half of 2021.
We worked to ensure that every employee felt supported during the COVID-19 pandemic – prioritizing their health and safety and supplying them with the resources they needed to navigate uncertainty. This included mental health resources, tools for employees managing family and homeschooling, and specific funds for those experiencing severe and unusual hardship as a result of the pandemic.
As part of our broader aim to foster a positive working environment for all employees, we evolved our health, safety and wellbeing (HSWB) ambition and delivery model, including the launch of a new HSWB index that will provide us with an overarching view of our performance and impact going forward.
We also engaged with local communities, which have been severely impacted by the pandemic, on a number of different fronts. For example, we made our expertise and facilities available to governments and health authorities in Belgium to help increase virus testing and monitoring.
Globally, we dedicated a one-off budget of €1.5 million to assist communities across the world with both financial and in-kind donations of much-needed supplies. We also partnered with other pharmaceutical companies and academics to identify and accelerate promising therapeutic candidates for COVID-19 and its related symptoms, as part of the COVID R&D Alliance , and we joined the COVID Moonshot to accelerate the development of a COVID-19 antiviral.
2020 also saw the launch of our global UCB Community Health Fund . While this is a longer-term project, the Fund’s initial focus is on understanding and reducing the medium and long-term impacts of the COVID-19 pandemic on vulnerable populations’ physical, mental, and social wellbeing.
2020 reminded us just how intertwined human health and the health of the planet are. That’s why we continue to work to minimize our impact on the environment and protect our planet’s health. We are working towards ambitious environmental targets to reduce CO2 emissions and become carbon neutral for the operations we control, to support our suppliers on their own sustainability journeys, and to reduce water consumption and waste production.
Our progress towards these targets in 2020 involved significantly extending the scope of our environmental key performance indicators, launching several local and global initiatives to embed our green goals within our operations and across our value chains, and engaging our suppliers and contract manufacturing organizations to define their ambitious climate targets. Our continued work to reduce our environmental impact is essential in helping us contribute to a healthier society overall.
As much as the pandemic has been a disruption, it also triggered further reflection and experimentation around how to adapt our ways of working for the future, in order to better deliver on our ambitions for all our stakeholders. This has been particularly true for UCB’s company-wide digital business transformation, already underway before the pandemic, but which was accelerated by COVID-19. We firmly believe that through digital transformation, we can amplify the power of scientific innovation to create sustainable value and ensure that patients can live the lives they want.
Adapting to meet the challenges of the future also means ensuring we have the right leadership in place to get us there. At the Annual General Meeting in April 2021 we will propose two new experienced and dedicated leaders to take the helm of the UCB Board. Stefan Oschmann, currently the Chairman of the Executive Board and CEO of Merck and a leader with outstanding strategic business experience in life sciences, will take up the position of Chair of the UCB Board, while Fiona du Monceau, an experienced leader who has been working in the pharmaceutical sector for over 20 years, will work alongside him as Vice-Chair.
For 2021, we aim for a total revenue of € 5.45-5.65 billion and an underlying profitability of 27-28% of total revenue. In the longer term, by 2025, we aim to lead in specific patient populations, creating value for people living with partial onset/focal epileptic seizures, psoriatic arthritis, osteoporosis-related fractures, myasthenia gravis, and for sub-populations of woman of childbearing age. For 2025, we expect revenue of €6 billion and an underlying profitability in the low to mid-thirties. We can only be successful when we create value for all our stakeholders, including employees, communities and the planet we all call home. You can learn more here about our progress and plans for the future in this regard.
Many of the challenges we faced last year remain with us in 2021, as the world continues to grapple with COVID-19. However, thanks to dedicated researchers, healthcare professionals, and civil society organizations, there is now hope, in the form of multiple vaccines and treatments. As we all look to the future therefore, no matter how distant it feels right now, we hope we can be strengthened by the lessons learned from and our reflections on 2020. Together, we firmly believe that we will continue to adapt and thrive, in order to deliver better care for all who need it, now and into the future.
Jean-Christophe Tellier, Chief Executive Officer
Evelyn du Monceau, Chair of the Board
Thank you Evelyn!
“2021 also brings with it the need to bid farewell to our respected and cherished Evelyn du Monceau, who will step down as the current Chair of the UCB Board in April following four years as Chair, and more than 35 years on the Board. As one of the few women chairing the Board of a Belgian company listed on Euronext Brussels, Evelyn has always demonstrated an unwavering commitment to advancing better care and treatment solutions for patients with unmet needs. We are deeply grateful for how she contributed to guide UCB on its transformation and growth journey. And we wish her all the best in the next chapter of her life.”
Lessons from a life at UCB: Evelyn in conversation with Jean-Christophe
Evelyn: At UCB we want to provide the best care possible to patients. Over the past 90 years, we have been on an incredible journey to become the biopharma company you see today. We’ve evolved and adapted – but we’ve always remained true to our core values and to our desire to understand what patients’ lives are really like; what are the smallest difficulties they have to face and how we can help them live the lives they want. That’s how we go beyond simply developing drugs, to create tailored solutions that truly make a difference for the patient.
To me, Better Care is therefore all about acknowledging that every patient’s experience is unique, while also understanding that how they live with their illness doesn’t just affect them, but also has a wider impact of their families, friends and communities.
At UCB, we try our best to integrate this holistic understanding of healthcare into the solutions we develop. This is possible thanks to the close contact we build and maintain with patients. When we think about the diseases we aim to treat, we immediately connect them to real human stories and faces. This is what gets us up in the morning. It gives our work an incredible sense of purpose, as well generating an enormous amount of joy when we develop better solutions to treat patients.
What have been the major changes you’ve seen in terms of how UCB impacts patients’ lives? How do you see this evolving in the future?
Ever since UCB has been active in pharma, our leadership has been focused on meeting patients’ needs above all else. Over the years, this has been reflected in our passion for science, as well as our significant, and sometimes risky, investments, especially in research and development. To lead the way in healthcare, you have to take decisions that lay the foundations for future success, even if you don’t see immediate results.
We are increasingly focused on specific patient populations who currently have no access to solutions or only inadequate solutions available to them. This increasingly personalized approach is supported by the rapid pace of scientific development, which is giving patients, caregivers and healthcare professionals greater control and choice over treatment and care options.
But it also requires a holistic understanding of healthcare rooted in a deep understanding of the patient’s experience, as well as the views of healthcare professionals, providers, and payors.
I think that in the future we will see more personalized treatment and care options, with devices and data used to support healthcare providers’ ongoing work and connect with patients in an ongoing yet efficient way.
How does UCB create value for society as a whole?
As a company, you are part of the world, not separate from it, and you have to make sure that every stakeholder in your surroundings is positively impacted by how you do business. When we do our work well, we not only create value for the patient, but also for our employees, for the communities where we operate, and for the shareholders who enable us to pursue our long-term ambitions.
This is part of UCB’s heritage and history as well. We’ve always been a company deeply committed to supporting local causes and keen to make a positive impact for local communities. And even as we’ve expanded our footprint beyond Belgium, this has remained an important focus; no matter where we are, we always try to engage with the world around us.
What achievements or decisions are you most proud of having witnessed or overseen during your time at UCB?
I am particularly proud of how UCB, and the pharmaceutical industry as a whole, stepped up to respond to COVID-19. For instance, we stopped some activities that would have been more lucrative for the company’s bottom line, to instead prioritize what needed to be done for the wider good of society. There was a real sense of solidarity across all levels of the company: the Board, the Executive Committee, and individual employees all wanted to make a meaningful impact. One example of how this happened was through the support we provided to Belgium’s testing capacity, with many employees volunteering to help staff the testing lab.
One of the most significant decisions we’ve ever taken has been setting the long-term purpose for our company: to create value for patients now and into the future, by developing clearly differentiated solutions with unique outcomes. This purpose acts as a North Star for any new joiner to UCB.
But there isn’t just one decision that has brought us where we are today; it’s been a succession of smaller, yet consistent choices and decisions, each taken with our purpose in mind, that have enabled us to progress. One example of this has been our ongoing investment in research and development (R&D) that we continued even in tough times, precisely because we didn’t want to sacrifice our long-term vision.
Taking this long-term approach demands a certain type of visionary, yet humble leadership. That’s something I see among all our leaders at UCB – and especially you, Jean-Christophe – and it’s why I am comfortable stepping aside now. With Stephen Oschmann as the new Chair of the Board, and Fiona du Monceau as the next Vice Chair, I know UCB is in good hands and well-equipped to go further than ever before.
Diversity, equity and inclusion (DE&I) are key to UCB’s success. How have you seen this commitment evolve over the years?
A company is, first and foremost, its people. Without the right people, you won’t get far, even with all the great ideas in the world. Cultivating diversity in all its forms among our employees – from diversity of thought, experience, and background, to culture, age, nationality, race or gender – is essential in allowing us to see things in a new light and constantly raise the bar in terms of our achievements. If our purpose is to create value for patients and wider society in a holistic way, then we need to make sure this is reflected in our workforce, so we can better serve all stakeholders. There’s always room for improvement here, but I think we are moving in the right direction.
As a woman who has progressed to board-level in your career, what advice do you have for other women aspiring to leadership roles?
As mentioned, diversity is far broader than just gender parity or female representation. But from a personal perspective, my advice to aspiring female leaders would be to be yourself and have confidence. You can do a lot more than you may think, so dare to aim high. Finding a good mentor can make a world of difference in this regard, as it gives you a champion whose example you can follow.
What will you miss most about UCB?
There’s nothing like the feeling you can have when after years of research and development, you bring a solution to patients that you see making a real, tangible difference on their lives; you can’t help but feel immense joy. I will miss that the most, along with all the great people I’ve had a chance to work with.
And what are you looking forward to spending more time on now?
I am mostly looking forward to spending more time with my family. But I also hope to become more engaged around three passion points of mine: education, entrepreneurship, and family business long-term sustainable value creation. The three are very much linked. Learning can and should be fun and it opens up so many possibilities. In the same spirit, we should be cultivating an entrepreneurship mindset, so that potential entrepreneurs aren’t afraid to take risks or to try new things, even if they occasionally fail on their path to success. Businesses are created by entrepreneurs, but they also need to be cared for with passion, dedication and resilience so they can grow and adapt to an ever-changing world.