Our High Performance Business (HPB) study of the pharmaceutical industry saw the whole peer group return to growth for the first time in four years. This growth is now forecast to accelerate in 2016 and hold over the next five years.

1. Accenture Life Sciences
Rethink Reshape Restructure…for better patient outcomes
Affordability and Value—
The Economics of Pharma’s
New Science
Accenture High Performance Business
Research

2. Investors continue to reward new science.
Copyright © 2016 Accenture All Rights Reserved. 2
Key Findings Summary: New Science – New Challenges
High Performers in pharma today are all about new science, but achieving high performance will also require
adapting operating models to better deliver patient and economic value.
Affordability and market access will challenge new science as a
growth driver.
High Performers will increasingly combine breakthrough medical
science with clearly demonstrated outcomes for patients and
healthcare systems.
Growth has returned and is forecast to accelerate while margins have
improved—but growth continues to be polarized at a company level.

3. Copyright © 2016 Accenture All Rights Reserved. 3
The Pipeline Replacement Revenue Ratio has
shifted markedly—back to levels not seen
since before the patent cliff of 2012.
Enterprise Value (EV) rose six percent
in 2015.
There were 45 NMEs approved in 2015, the
highest number since 1996.
In 2015, the industry saw mixed performance at a
company level as well as declines since Q4-15, but
overall performed five percent above the
S&P500 across the year.
Investors continue to reward new science.

4. Enterprise Value ($ Billion) for “Pure Plays” 2008-15
Key Finding #1:
Key Finding #1:
Enterprise Value grows for the 5th year in a row.
-$207 -$190 -$323 -$405 -$347
$1,140 $1,372
$1,263
$1,501
$1,703
$1,632
$1,714
$2,155
$1,178
$1,298
$1,713 $1,808
$69.1
$85.4
$76.8
$85.1
$80.2 $79.9
$76.3
-$95
2010
+12%
Nov-152008
$1,046
2012
-$2
$1,538
20142013
+6%
2011
$1,073
2009
$1,165
-$94
FVNOPLAT CVEV
Note: 16 pure play biopharma companies only. Japanese companies have March year end (YE14 = Mar-15). Constant USD FOREX used from Oct 2015. Nov 19th 2015 share price
used in latest EV and Q3-15 NOPLAT.
Source: Accenture Research, Dec 2015.
-9% -18% -18.0% -27% -31% -6% 0% -19%FV/EV =
Copyright © 2016 Accenture All Rights Reserved. 4

5. Patent expiries rose markedly in 2015 as did new drug approvals
and pipeline replacement ratio.
$12.1
$5.7
$19.0
$16.0
$3.9
$17.0
$23.7
$8.9$8.5
$15.6 $13.4
$11.7
$18.8
$22.7
$27.8
$31.6
$16.8
$24.9
$28.4
$19.4
$22.6
$16.3
$21.9
$16.1
4.6
5.5
3.6
2.7
2.3
1.0
1.1
1.9
2.5
2.8
3.2
4.0
5.2
4.4
5.7
$8.9
$0.5
$45.6
2018
$33.3
2017
$26.5
2016
$35.5
2015
$47.4
2020
$25.0
20192014
$30.6
2013
$28.9
2012
$31.6
$0.0
2011
$29.0
$1.2
2010
$24.1
$1.5
2009
$18.8
$0.0
2008
$12.6
$0.9
2007
$14.8
$1.4
2.7
2006
$15.7
$0.1
2005
Sales Losing Exclusivity (Biotech Rx)Sales Losing Exclusivity (Conventional Rx)Pipeline Replacement Ratio
Lantus
Neulasta
Gleevec
Abilify
Nexium
Epogen
Humira
Advair
Crestor
Zetia
Zytiga
Cialis
Rituxan
Remicade
Lyrica
Spiriva
Revlimid
Avastin
Herceptin
Gilenya
Levimir
Invega Sus
Botox
Tysabri
Source: Accenture Research Nov-15, based on Evaluate Pharma and FDA CDER Statistics.
Key Patent
Upcoming
Expiries:
5 year Average FDA NME Approvals
2006-10
22.4
5 year Average FDA NME Approvals
2011-15
36.4
Patent Exposure & Pipeline Replacement
Pharma Industry 2005-20E
Copyright © 2016 Accenture All Rights Reserved. 5

6. Copyright © 2016 Accenture All Rights Reserved. 6
Growth has returned and is forecast to accelerate while
margins have improved—but growth continues to be polarized
at a company level.
After three years of negative revenue growth, the
peer set overall has returned to positive
growth and is forecasted to accelerate.
Six companies are outperforming their peers,
with Eli Lilly joining the High Performers for
the first time.
These High Performers are also growing
faster than the rest of their peers.
After four years of falling Core Operating Margins,
the peer set saw a one percentage point
improvement in 2015.

7. Revenues grew in 2015 after three years of negative growth.
Pharma Pure Play Peer Set: Total Revenue & Earnings Growth 2008-2015
$412,443
$431,711
$445,766
$428,962 $424,433
$416,366
4.7%
0.5%
-3.8% -1.1%
-1.9%
0.5%
7.8%
8.7%
-5.0% -5.4%
-6.2%
-8.2%
4.9%
$443,719
2008 Nov-15
-7%
20142009 20132012
2.8%
2010 2011
$418,473
Group Rev Growth Group Earnings* Growth Group Rev ($B)
25.7% 26.5% 28.0% 26.5% 26.0% 24.7% 23.1% 24.1%
Source: Accenture Research based on Capital IQ Nov 2015.
Operating Margin*:
*Total Peer Group Revenue and Earnings (Core EBIT) in USD at constant FOREX is analysed– meaning larger companies performance does skew trends
Copyright © 2016 Accenture All Rights Reserved. 7

8. High Performers have stronger forecast growth and pipeline
replacement revenue ratio as well as higher operating margins.
1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0
12%
10%
8%
6%
4%
2%
0%
-2%
Novo
Nordisk
Astellas
Amgen
BMS
Pipeline Replacement Ratio 2015-20
CAGR2015-18
Roche
Eli
Lilly
Avg 3.4%
Avg 2.8x
RestHigh
5%
10%
15%
20%
25%
30%
35%
40%
45%
-15.0% -10.0% -5.0% 0.0% 5.0% 10.0%
∆ 2013-15*
2015*CoreEBIT/Rev
Astellas
Novo
Nordisk
BMS
Eli
Lilly
Roche
Amgen
Avg 22.2%
Avg -0.1%
Revenue Growth Forecast vs.
Pipeline Replacement Revenue Ratio
Core Operating Margin vs.
Change in last 2 years
Source: Accenture Research Nov-15, based on Evaluate Pharma & Capital IQ.
*Core EBIT Margin is based on Trailing 12 months to Q3-2015. Pipeline Replacement Revenue Ratio reflects Revenue growth from patented products divided by Revenue lost to
unpatented products (and those with undefined patent status).
Copyright © 2016 Accenture All Rights Reserved. 8

9. Copyright © 2016 Accenture All Rights Reserved. 9
Affordability and market access will challenge new science as
a growth driver.
Nearly one-third of new drug launches are
significantly missing analysts sales targets.
There is a $50B affordability gap between analysts’
sales projections for NME launches 2015-20 and forecasts
for developed market spending on pharmaceuticals.
The average proportion of new drug launches
accessible to patients fell 9.5 percentage
points from 2011 through 2013.

10. Accessibility and affordability are under pressure.
25%
30%
35%
40%
45%
50%
55%
60%
65%
70%
2011 2012 2013
-18.3%
Average
CA
UK
US
52.0%
GY
Availability of NMEs Approved in Previous 5 Years -
Selected Developed Markets 2011-13
Source: Accenture Research based on Evaluate Pharma Dec-15 and IMS Health Global Outlook for Medicines publications 2012-14.
$136
$122
$87
$121Net Generics
Savings
Pharma
Net Spending
Growth ($B)
Recent & Upcoming
Launches - Growth
2015-20E
+$50
$258
Dev Markets
Forecast growth
2015-20E
$208
Recent
Launches
2011-15
Upcoming
Launches
2016-20
Affordability of Recent and Upcoming NME
approvals 2015-20E ($ Billion)
Copyright © 2016 Accenture All Rights Reserved. 10
“The
Affordability
Gap”

11. Copyright © 2016 Accenture All Rights Reserved. 11
High Performers will increasingly combine breakthrough
medical science with clearly demonstrated outcomes for
patients and healthcare systems.
Using M&A and
collaboration to
dominate in target
disease areas
Developing new and
more agile business
models in response
to market realities of
affordability and
consumerization
Maximizing
productivity from
R&D investment with
smaller, more
focused pipelines
and the best science
Excelling at product
launches by
mastering flexible
pricing, market
access and
demonstrating
superior outcomes
High performers excel at several operational attributes and capabilities:

12. NME
Output
2010-15*
Rest
(n=10)
10.9%
The hallmarks of being a High Performer (1 of 2)
Forecast Growth/
Pipeline Strength
Portfolio Freshness
New Launch Growth
High
Performers
(n=6)
2015-20
5yr CAGR
5.3%
2016 %
Growth
6.5%
4.3
1.6
Pipeline
Replacement
Revenue Ratio
2015-17
High Perf
(n=6)
40.7%
Rest (n=10)
23.5%
Recent & Upcoming Launches
Growth 2015-19E as % 2015
Pharma Rev
Focus/Therapeutic Area
Dominance
64.2%
41.5%
Top 5 Products Share of
Pharma Rev 2014
2020
15.7%
23.7%
3.0
2.1
2014
17.3%
24.9%
2.5
2.4
Top 5 Products Avg Global
TA Share and Rank
Innovation Output/
Productivity
Externalization Performance of NME Launches
2012-14 vs. Analyst Expectations
High
Performers
(n=6)
6.2%
0.75
0.44
Avg Sales ROI on
Avg R&D Spend
$4.0B
$2.9B
Avg R&D/NME
55.3%
45.7%
External Products
Growth 2014-20E as
% 2014 Pharma Rev
5.6%
2.0%
4.5%
1.2%
Rest
(n=10)
High Perf
(n=6)
Total
Pharma Rev
CAGR
2014-20E
External
Products
CAGR
2014-20E
% NMEs
Significantly
Missing Target
49%Rest
(n=10)
High
Performers
(n=6)
Source: Accenture Research Dec-15, based on Evaluate Pharma & Capital IQ.
Avg $ Perf vs
Analyst Target
$122
33%
2.9%
Rest
(n=10) 0.8%
$892B
Avg Sales
5yrs Post
Launch
$368B
Copyright © 2016 Accenture All Rights Reserved. 12
High Perf
(n=6)
Rest
(n=10)
-$26

13. The hallmarks of being a High Performer (2 of 2)
Source: Accenture Research Dec-15, based on Evaluate Pharma & Capital IQ.
Core Operating Margin
Pipeline
Replacement
Rev Ratio
2015-20
28.9%High
Performers
(n=6)
15%
20%
25%
30%
20102008 2012 Nov-
15
18.1%Rest
(n=10)
High Performers – Key Attributes:
1) Faster Growth, Higher Pipeline Replacement Ratio
• Already back to growth & faster growth forecast
• Stronger Pipeline covering IP Exposure
2) Fresher Portfolio driving Growth
• Stronger $ Growth potential from Recent & Upcoming
Launches
3) Focus and Therapy Area Dominance
• Top 5 products larger share of Group Rev
• Higher Avg Global Rank/Mkt Share of Top 5 Products
4) Innovation Output & Productivity
• Fewer NME launches, and higher R&D spend on each
• But Higher Sales at 5 years, and Sales ROI on R&D
5) Greater and more effective Externalisation
• Higher $ Forecast from externally originated products
• Externally derived products growth faster for company
6) New Launch - Commercial Traction years 1 & 2
• Fewer NME launches significantly missing Analyst
Targets
• Average $ performance beating analyst expectations
7) More Profitable
• Higher Core Operating Margin, holding up better in
recent years
Copyright © 2016 Accenture All Rights Reserved. 13

14. Our HPB study ranks the long term performance of a peer set of 16 of the largest pure-play
biopharma companies* over an eight-year period based on year-end trailing 12 month Q4-2014
financials. These results have been compared with our previous 2014 and 2013 studies, to identify
relative movements in the performance rankings. A detailed analysis over one, three, five and seven
years is combined with equity analyst consensus forecasts to gain a view of forecast revenue growth
from portfolio and new product launches, as well as the potential impact of patent expiries and
mature products.
About Accenture’s High Performance Business Study:
Methodology
*Pure Biopharma defined as companies having more than 75% of revenue coming from pharmaceutical products
14
HPB Metrics
• Longevity
• Profitability
• Historical Growth
• Future Value Component of
Enterprise Value
• Consistency
• Pipeline Growth/IP Risk
Contact Us
Anne O’Riordan
Senior Managing Director
Accenture Life Sciences, Global
anne.oriordan@accenture.com
Tom Schwenger
Senior Managing Director
Accenture Life Sciences, North America
thomas.d.schwenger@accenture.com
Andrea Brueckner
Managing Director
Accenture Life Sciences, Europe
andrea.brueckner@accenture.com
Copyright © 2016 Accenture All Rights Reserved.

15. Copyright © 2016 Accenture All Rights Reserved. 15
To learn more, visit:
accenture.com/PharmaHPB
Author
Philip J. Davis
Head of Life Sciences & Healthcare Research
Accenture Research
p.davis@accenture.com
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