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LUCY DYER
LUCY DYER / PORTFOLIO
LUCY DYER
LUCY DYER / PORTFOLIO
ANNUAL REPORT CHEM & CO
LUCY DYER / PORTFOLIO
Preparing Chem+co to take this transformational step began with our
efforts late in 2012 and in 2014 to reduce the number of layers in the
company, streamline decision-making and expand our discovery efforts.
Our transformation continued in 2014 with a new strategic framework
called “Our Path Forward”- and later that year with the reorganisation
of the company into smaller, more agile business units. Every step of
the way, Chem+co colleagues have worked to increase the ability of
the company to deal with a very fast-changing business environment.
We’ve titled this report “Think Differently” because that’s exactly the
approach we’re taking - challenging the status quo of our industry
and breaking away from old practices that are no longer relevant in a
new environment. A streamlined, more flexible, strategically grounded
Chem+co is now ready to create one of the most dynamic and diversified
companies in the global health care industry.
COMMITMENTS MADE, COMMITMENTS KEPT
Our drive for change, however, starts with one of the
oldest paths to trust and accomplishment—keeping our
commitments. In these annual letters to you, I’ve repeated
what I believe—that all Chem+co leaders, starting with me,
must be accountable for meeting the commitments we’ve
made to find new sources of revenue, become faster and more
efficient, and build a strong pipeline of new compounds and
product extensions. Action by action, quarter by quarter, we
are establishing Chem+co as a company that keeps promises.
At the beginning of 2014, we made or reaffirmed four major
commitments to you, our investors. These were:
• To hold revenues steady, despite the deteriorating
economic environment and the losses-of-exclusivity we
faced in 2010 and (current year).
• To complete the program to achieve an absolute
reduction in our adjusted total costs of at least $1.5
billion–$2 billion, on a constant currency basis, as
compared with 2008.
• To achieve adjusted diluted earnings per share
performance of at least $2.35 per share.
• To improve R&D productivity, as measured by
medicines moving into late-stage development.
Here’s how we did in meeting each of these commitments:
Holding Revenues Steady
Our (current year) full-year revenues were $48.3 billion,
compared with $48.4 billion in 2012. This was in line with
the guidance we gave early in 2008. We achieved this goal
despite the loss of exclusivity of three large-selling medicines,
Norvasc, Zyrtec/ZyrtecD and Camptosar, which accounted
for $2.9 billion in 2008 revenue and $5.5 billion in revenue
in 2007. We also achieved this goal despite shrinking
economies in nearly all of our major markets.
Reducing Our adjusted total Costs
We completed the cost-reduction program we announced in
2008 by exceeding our cost-reduction target. By the end of
2010, we decreased our adjusted total costs by $2.8 billion,
when compared with 2008 costs, on a constant currency
basis. We remain absolutely committed to streamlining our
business further and creating a cost structure that gives us
the most flexibility during these uncertain times.
Achieving Our Adjusted Diluted Earnings Per Share target
We were at the high end of our (current year) guidance range, delivering $2.42 in adjusted diluted earnings per share, an improvement of 11 percent over 2012.
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BECOMING MORE ENTREPRENEURIAL AND ACCOUNTABLE
In late 2012, when I became CEO, I said that one of
Chem+co’s biggest immediate challenges was to simplify an
organisation that had grown too complex and cumbersome.
One colleague, in an e-mail to me, put it best: “Get the
bureaucracy out of our way. Give us the tools to do our
work and the authority to make decisions. Then hold us
accountable for the decisions we make.”
Making Chem+co work better meant changing both the
culture and the structure of our organisation. In 2012 we
took a dramatic step to reshape Chem+co into a more
flexible, entrepreneurial and, yes, accountable organisation.
We completely reorganised our global market-leading
Pharmaceutical segment into customer focused business
units devoted to Primary Care, Specialty Care, Oncology,
Emerging Markets and Established Products.
ACCELERATING INNOVATION
In this review last year, we reported on our drive
to open a second front in the search for new cures
and vaccines. We organised the Biotherapeutics and
Bioinnovation Center, which is both independent
of, and interdependent with, Chem+co Global
Research & Development. Just over a year into that
transformation, we are excited about the progress
made by both research groups, their ability to
collaborate as alliances are formed with other research
organisations, and their potential to “supercharge”
our pipeline with medicines and vaccines that address
some of the world’s most pressing medical needs.
CHEM+CO AND WYETH
Chem+co’s path forward now includes an agreement to
acquire Wyeth. Once this acquisition is complete, Chem+co
will be uniquely positioned to promote health and wellness
at all stages of life, and respond more effectively to unmet
medical needs. We will also be one of the most diversified
companies in the global health care industry, overcoming
reliance on any single product.
Chem+co’s acquisition of Wyeth will be a transformational
step enabled by a willingness to do things differently. We
look to the future with optimism and relish the work we
have yet to do to make Chem+co the world’s premier
biopharmaceutical company.
Thank you for your continued confidence in our people, our
products and our plans for the future.
Sincerely,
Jeff Kindler
Chairman of the Board and Chief Executive Officer
July 1, 2015
‘Think Differently’ means working harder to listen to our customers and to respond to what they tell us.
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CHEM+COANNUAL REVIEW: 2014
THINKENTLY
DIF FER
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Chem+co - Wyeth: Building Value and Leadership
On January 26, (current year), Chem+co and Wyeth announced an
agreement by which Chem+co will acquire Wyeth for cash and stock.
Here’s why Wyeth is right for Chem+co.
CHEM+CO - WYETH WILL ADVANCE ALL OF CHEM+CO’S STATED STRATEGIES
Chem+co Strategy:
Become a leader in biologics
What Wyeth Brings:
• Enbrel, among the world’s
best-selling biological
medicines
• A solid biologics pipeline
• World-class manufacturing
capability
What Wyeth Brings:
• Prevnar, for pneumococcal
viruses, the world’s top-
selling vaccine
• A strong late-stage vaccine
• World-class production
capability
What Wyeth Brings:
• New medicines and
product candidates to
fight inflammation, cancer,
nervous system diseases.
What Wyeth Brings:
• An emerging markets
presence that solidifies
Chem+co’s leadership in
Asia and Latin America
What Wyeth Brings:
Chem+co Strategy:
Enter the global vaccines
business
Chem+co Strategy:
Expand in fast-growing
therapeutic areas
Chem+co Strategy:
Strengthen leadership in
emerging markets
Chem+co Strategy:
Create New Opportunities
for Established Products
• Greater depth and breadth
to Chem+co’s Established
Products portfolio
Chem+co Strategy:
Invest in complementary
businesses
Chem+co Strategy:
Establish a lower, more
flexible cost base
What Wyeth Brings:
• Legendary consumer
products such as Advil
and Centrum, along with
nutritionals and animal
health products
What Wyeth Brings:
• Greater scale and the
potential for long-term
growth and stability
Chem+co-Wyeth will build a more diversified company C
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CHEM+CO TODAY
Total Primary 75% / Total Specialty 17%
COMBINED COMPANY: PROJECTED 2012
Total Primary 55% / Total Specialty 30%
The proposed combination of Chem+co and Wyeth addresses one of the largest
concerns of Chem+co investors: the expected loss-of-exclusivity for Lipitor in
2011. No single medicine is expected to account for more than 10 percent of the
combined company’s sales in 2012.
Annual Report / Chem & Co
LUCY DYER / PORTFOLIO
PACKAGING & STATIONERY THE HUMBLE CRUMB BAKERY
LUCY DYER / PORTFOLIO
Packaging & Stationery / The Humble Crumb Bakery
LUCY DYER / PORTFOLIO
E.PUBLICATION / MAGAZINE
‘UNRAVEL’
LUCY DYER / PORTFOLIO
E.Publication / Magazine / ‘Unravel’
LUCY DYER / PORTFOLIO
HANDMADE PROJECT BRUCE SPRINGSTEEN
‘BORN IN THE USA’
LUCY DYER / PORTFOLIO
Handmade Project / Bruce Springsteen / ‘Born In The USA’
LUCY DYER / PORTFOLIO
EVENT FLYER & ROLL OUT
BUSHWICK BLOCK PARTY
LUCY DYER / PORTFOLIO
Event Flyer & Roll Out / Bushwick Block Party
LUCY DYER / PORTFOLIO
KIDS MOBILE APP GOOD PIGGY MONEY
SAVING APP
LUCY DYER / PORTFOLIO
Kids Mobile App / Good Piggy Money Saving App
LUCY DYER / PORTFOLIO
CORPORATE REPORT
GREAT BARRIER REEF
LUCY DYER / PORTFOLIO
PROTECTING + PLANNINGFOR THE FUTURE
ANNUAL REPORT HIGHLIGHTS: 2014 - 2015
GREAT BARRIER REEF MARINE PARK AUTHORITY
EFFECTIVE MANAGEMENT OF THE GREAT BARRIER REEF MARINE PARK IS MORE IMPORTANT THAN EVER TO ENSURE THE WORLD’S LARGEST CORAL REEF ECOSYSTEM IS PROTECTED FOR THE FUTURE. NOT ONLY IS THE REEF INTERNATIONALLY RECOGNISED FOR ITS AMAZING BIODIVERSITY AND OUTSTANDING NATURAL BEAUTY, IT IS AT THE HEART OF MANY REEF INDUSTRIES AND COMMUNITIES FOR BOTH RECREATION AND THEIR LIVELIHOODS.
OBJECTIVE ONE:
ADDRESSING KEY RISKS AFFECTING THE OUTLOOK OF THE GREAT BARRIER REEF
This year, the agency continued its strong focus on addressing the key risks to the health of the Great Barrier Reef. The impacts of climate change pose the greatest threat to the Reef.
The other key threats are declining water quality due to catchment run-off, loss of coastal habitats from increasing coastal development and remaining impacts from fishing, illegal fishing and poaching. Port expansions, increased shipping and extreme weather events have also emerged as risks in recent times.
The agency has channelled significant resources and effort into building the Reef’s resilience so it can withstand these threats in the long-term.
HIGHLIGHTS: HIGHLIGHTS:
• Completed the integrated Eye on the Reef monitoring program to provide a centralised database for Reef health information
• Contributed to the first Reef Plan report card was released, providing a baseline against which progress in addressing declining water quality will be measured
• Conducted pilot programs in two fisheries to develop assessment standards for fishers wanting to join the Reef Guardian program
• Implemented new commercial netting regulations in Bowling Green Bay to reduce dugong deaths
• Developed an ecological risk assessment of the East Coast Trawl Fishery in collaboration with the Queensland Government and fishing industry
• Conducted Reef Health and Impact Surveys to gauge the recovery of northern reefs after cyclone Yasi and to assess reef recovery from Fitzroy River flood damage
• Installed fencing at Raine Island in a practical on-ground climate change adaptation initiative to prevent green turtle deaths
• Confirmed that voluntary no anchoring areas in the Keppels area have helped build the Reef’s resilience
• Upgraded the tourism operators’ emissions calculator to help operators reduce their carbon emissions
• Oversaw a new Australian Government program to reduce the potential severity of a crown-of-thorns starfish outbreak.
The Great Barrier Reef is facing increasing pressures from continued growth and development both within and outside the Marine Park, as well as growing pressures from shipping. The Great Barrier Reef Marine Park Authority is committed to ensuring management delivers ecologically sustainable use of the Great Barrier Reef.
The agency has a dedicated compliance regime to manage use of the Marine Park. It also achieves ecologically sustainable use through building strong partnerships with stakeholders and encouraging good stewardship of the Reef.
• Developed the draft Great Barrier Reef Biodiversity Conservation Strategy, a roadmap to protect at-risk animals, plants and habitats of the Great Barrier Reef
• Signed an agreement with the Minister for Sustainability, Environment, Water, Population and Communities to conduct a comprehensive strategic assessment of the Great Barrier Reef Region
• Launched the Recreation Management Strategy, providing a framework for managing recreation within the Marine Park
• Increased the number of tourism operators in the High Standard Tourism program from 51 to 57 (now carrying 60% of all visitors)
• Facilitated accreditation of the Port Curtis Coral Coast regional Traditional Use of Marine Resources Agreement — the fifth and largest agreement of its kind
• Completed 1443 compliance and enforcement vessel patrol days across the Marine Park
• Conducted 894 Reef Health and Impact Surveys in the Great Barrier Reef World Heritage Area
• Partnered with more than 43 marine tourism operators for Eye on the Reef Tourism Weekly Monitoring program and conducted training for tourism crew in the Cairns and Whitsunday areas
• Facilitated more than 750 students taking part in Future Leaders eco challenges and delivered science teaching units to all 285 Reef Guardian schools
• Completed a collaborative turtle monitoring project, enabling the exchange of western science and traditional ecological knowledge
• Provided environmental impact assessment advice on 10 port-related projects and more than 50 other major projects, including the Great Keppel Island marina and tourism
OBJECTIVE TWO:
DELIVERING ECOLOGICALLY SUSTAINABLE USE
ONE: ANNUAL REPORT 14/15
HIGHLIGHTS:
OBJECTIVE THREE:
MAINTAINING A HIGH PERFORMING, EFFECTIVE ORGANISATION
• Attracted more than 145,000 visitors to Reef HQ Aquarium, breaking a 20-year visitation record
• Launched a new external website which boosted the average user time on a page from 30 seconds to three minutes
• Established a document control system as part of the Australian Government’s Information Publication Scheme requirements
• Conducted a comprehensive zoning awareness program targeting recreational fishers, particularly those who fish infrequently in the Marine Park
• Delivered reef education to more than 5700 students through Reef HQ Aquarium’s Reef Video-conferencing program
• Worked with the Department of Sustainability, Environment, Water, Population and Communities to finalise the Retrospective Statement of Outstanding Universal Value for the Great Barrier Reef World Heritage Area
• Completed a heritage management plan to protect the Lady Elliot Island light station, a 139-year-old landmark at the southernmost point of the Great Barrier Reef
• Established a hosting partnership with the Government of Belize for the International Coral Reef Initiative and coordinated the first of two meetings of members
• Gained more than 1200 followers on the agency’s Facebook page and launched a YouTube channel which was viewed more than 5500 times.
• Refurbished the underwater viewing tunnel, unveiled a new Rainforest Tree exhibition and opened a new conference and training centre at Reef HQ Aquarium.
The Great Barrier Reef Marine Park Authority recognises that being a high performing, effective and efficient organisation is central to achieving the agency’s goals and objectives. The agency places strong emphasis on maintaining and developing effective knowledge management systems, services and processes. This is illustrated by the many achievements made in these areas over the reporting period.
Education and communication are recognised as essential to managing the Reef and preserving it for future generations.
Reef HQ Aquarium — the Australian Government’s national education centre for the Great Barrier Reef — reaches thousands of people each month with messages about the wonders of the Reef, risks to its resilience and what can be done to protect it. The agency also communicates through its external website, traditional media outlets, social media, awareness campaigns and a range of other mediums.
»FIRST REEF PLAN REPORT CARD WAS RELEASED
»MORE THAN 750 STUDENTS PARTICIPATED IN FUTURE LEADERS ECO CHALLENGES
»MORE THAN 145,000 VISITORS TO REEF HQ AQUARIUM
»60% OF ALL REEF VISITORS ARE CARRIED BY TOURISM OPERATORS IN THE HIGH STANDARD PROGRAM
TWO: ANNUAL REPORT 14/15
Corporate Report / Great Barrier Reef
