Miltenyi Biotec in Asia Pacific

Regional diversity, opportunities & challenges

Dr. Boris Stoffel4th Life Science Conference, 17th May 2011, Frankfurt

IN OR OUT?

Sculpture Park Cologne Garden Gallery, Exhibition Köln Skulptur #6 Sou Fujimoto, 2011

Germany‘s largest independent, privately owned Biotech Company

Founded in 1989 by Dipl. Phys. Stefan Miltenyi, President / CEO

More than 1200 employees in 18 countries

More than 300 employees in R&D reagents, engineering & clinical development

Profitable since inception; revenues 2010 > 170 Mio US$

Key facts

Miltenyi Biotec

Number of employees 1989 - 2010

3101

203

1200

0

200

400

600

800

1000

1200

1400

1989 1995 2000 2010Year

75% in Germany

25% Subsidaries

…but only 15% of global revenues are generated in the DACh sales region!

Miltenyi Biotec is committed to advancingscientific understanding and medicine

by providing tools forbiomedical research and cellular therapy.

Mission

Miltenyi Biotec portfolio management

MACS separation principle

Magnetic separation

Magnetic labeling Positively selected fraction

Core technology

MACS® Columns and Separators

Gentle to cells Thorough rinsing procedure Convenient for working under sterile conditions Straightforward to automate

MACS® Column in strong permanent magnet

Spherical steel matrixin column induces

high-gradient magnetic field

High-gradient magnetic fieldefficiently retains magnetically

labeled cells in column

Technologies

Miltenyi Biotec portfolio management

Cell Culture

Molecular Analysis KIR Typing Kit

MACS Reagents

CellularAnalysis Biomolecule

SeparationmRNA isolation Kit

Sample Preparation gentleMACS™ tubes & MACSmix Tube Rotator

Cell Separation

OctoMACS Starting Kit

Adding value to the workflow

MACS Media® & Cytokines

Genomic Services

Miltenyi Biotec’s research instrument portfolioserves hundreds of applications

Sample Preparation

Bio-molecule Separation

Molecular Analysis

Cell Analysis

Cell Culture

Cell SeparationgentleMACS™

Dissociator

MultiMACS™M96 (thermo) Separator

autoMACS® Pro Separator

MultiMACS™ Cell24 Separator

MACSQuant®Analyzer

Research instrument portfolio: Ease of use

The translational approach

Donor / patient

Cell Material Cell selection

Cell expansionor differentiation

Quality control

Cryopreservation

Administration to patient

Where cells replace or support drug regiments: from bench to bedside

The translational approach

Donor / patient

Cell Material Cell selection

Cell expansionor differentiation

Quality control

CryopreservationCliniMACSReagents MACS GMP Media

Cell culture bags

MACS GMP Cytokines

Cell differentiation bags

Administration to patient

CryoMACSFreezing Bags

+ + ++=

++

New benchmark in cellular therapy

+ + ++=

++

New benchmark in cellular therapy

CliniMACS Prodigy

Hematology / Graft engineering(blood & marrow transplantation)

Adoptive immunotherapy

Regulatory T cell therapy

Dendritic cell therapy

Regenerative medicine (heart, liver, bone, nervous system, …)

Use of the CliniMACS System

Miltenyi-sponsored Phase III trial ‘PERFECT‘

Intramyocardial injection of BM-derived CD133+ stemcells during bypass surgery

CD133+ stem cells for liver regeneration Randomized, controlled, prospective, multicenter

approval trial

Test balloon for de-centralized cell manufacturing in EU

How do the first results look?

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70

Control CD133D

ays

to S

urge

ry

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Control CD133

Dai

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th R

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(mL)

Patients grow their liver faster

Patients get surgery faster

1989 1992 1996 1998 2003 2003 / 2004 2008 2011/2012

Miltenyi Biotec Miltenyi Biotec Miltenyi Biotec Miltenyi Biotec Miltenyi Biotec Miltenyi Biotec Miltenyi Biotec Miltenyi Biotec Germany US UK France, Italy & Regulatory Affairs Australia, Japan China China

Spain Boston, US Singapore Rep. Offices Trading Shanghai companyBeijing

1989 1992 1996 1998 2003 2003 / 2004 2008 2011/2012

Miltenyi Biotec Miltenyi Biotec Miltenyi Biotec Miltenyi Biotec Miltenyi Biotec Miltenyi Biotec Miltenyi Biotec Miltenyi Biotec Germany US UK France, Italy & Regulatory Affairs Australia, Japan China China

Spain Boston, US Singapore Rep. Offices Trading Shanghai companyBeijing

Inception Miltenyi Biotec subsidiaries 1989 - 2012

Asia Pacific employee development 2008 - 2011

Singapore distributor network covering

India

Pakistan

Bangladesh

Thailand

Malaysia

Indonesia

Taiwan

Korea

Singapore distributor network covering

India

Pakistan

Bangladesh

Thailand

Malaysia

Indonesia

Taiwan

Korea

Employees 2008 2009 2010 2011

MB Australia 6 6 7 9MB China 10 11 12 13MB Japan 24 25 29 31MB Singapore 10 11 9 11

Asia Pacific Overall Sales 2008 – 2010 vs. US – EU – RoW

Annual averagegrowth 2008 - 2010Europe 12%Asia Pacific 15%USA 10%RoW 20%

Asia Pacific Overall Subsidiary Sales 2008 – 2010

Annual averagegrowth 2008 - 2010Australia 20%Japan 12%Singapore 19%China 20%

Asia Pacific Region Research Sales 2008 – 2010 vs. US – EU – RoW

Annual averagegrowth 2008 - 2010Europe 15%Asia Pacific 14%USA 9%RoW 26%

Asia Pacific Subsidiary Research Sales 2008 – 2010

Annual averagegrowth 2008 - 2010Australia 22%Japan 11%Singapore 17%China 23%

Asia Pacific Region Clinical Sales 2008 – 2010 vs. US – EU – RoW

Annual averagegrowth 2008 - 2010Europe 5%Asia Pacific 26%USA 20%RoW 16%

Asia Pacific Subsidiary Clinical Sales 2008 – 2010

Annual averagegrowth 2008 - 2010Australia 9%Japan 186%Singapore 136%China 22%

Miltenyi Biotec Australia

Growth in %

Review . Challenges . Opportunities

Funding situation unstable

Cellular therapies: new strategic focus

Past focus towards US and Europe, now more networking in APAC

Hugh geography to be covered

Miltenyi Biotec Australia Pty. Ltd.

Inception 2003

Office 1 / Sydney

Employee increase since inception + 50%

Contribution to MB group revenue (2010) 2%

Contribution to APAC revenue (2010) 14%

Average growth 2006 - 2010 12%

Clinical / Research split 7 / 93

+29% 2010

+17% 2009

+14% 2008

+8% 2007

-7% 2006

Miltenyi Biotec Singapore / Asia Pacific

Growth in %

Review . Challenges . Opportunities

Increasing cost of living

Increasing cost of labour

Increasing cost of rent

Recruitment of skillful people extremely difficult

Too far away from major APAC markets

Miltenyi Biotec Asia Pacific Pte Ltd.

Inception 2003

Office 1 / Singapore

Employee increase since inception + 10%

Contribution to MB group revenue (2010) 4%

Contribution to APAC revenue (2010) 23%

Average growth 2006 - 2010 20%

Clinical / Research split 17 / 83+8% 2010

+19% 2009

+28% 2008

+14% 2007

+32% 2006

Miltenyi Biotec Japan

Growth in %

Review . Challenges . Opportunities

2008/2009 change in management

2010 MB KK. Japan – number one Life Science company in Japan

Strong team of dedicated people of the „younger“ generation

High quality products extremely valued in Japan (Made in Germany)

Excellent market knowledge

Outstanding technical support

Miltenyi Biotec K.K.

Inception 2003

Office 1 - Tokyo

Employee increase since inception + 30%

Contribution to MB group revenue (2010) 8%

Contribution to APAC revenue (2010) 52%

Average growth 2006 - 2010 14%

Clinical / Research split 7 / 93 +15% 2010

+18% 2009

+1% 2008

+6% 2007

+28% 2006

Miltenyi Biotec China

Review . Challenges . Opportunities

2008 we changed our management

Cultural challenges – language, trust, metality, intransparency

Increasing labour cost / compensation packages

Complexity in clinical regulatory affairs

Supplement international management & experts to support market development

2011 trading company to penetrate market with distributor network and direct sales

Analyze partnering opportunities for production

Create products especially for the chinese market

Growth in %

Miltenyi Biotec China Shanghai / Beijing

Inception 2008

Rep. offices 1 - Shanghai, 1 - Beijing

Employee increase since inception + 100 %

Contribution to MB group revenue (2010) 2%

Contribution to APAC revenue (2010) 11%

Average growth 2006 - 2010 14%

Clinical / Research split 20 / 80 +21% 2010

+33% 2009

+7% 2008

-1% 2007

12% 2006

In or out?

Sculpture Park Cologne Garden Gallery, Exhibition Köln Skulptur #6 Sou Fujimoto, 2011

Miltenyi Biotec China

Miltenyi Biotec China Shanghai / Beijing

Inception 2008

Rep. offices 1 - Shanghai, 1 - Beijing

Employee increase since inception + 100 %

Contribution to MB group revenue (2010) 2%

Contribution to APAC revenue (2010) 11%

Average growth 2006 - 2010 14%

Clinical / Research split 20 / 80

Review . Challenges . Opportunities• 2008 management change

• Increasing labour cost / compensation packages• Language barríer• Scarcity of experts for HR recruitment• Market penetration with diverse product portfolios• Representative office status preventing direct sales approaches. Required to act legally as a sales

organisation in China• Clinical regulatory affair complexity• 5 year planning for instrument investments

• Tie up competitive HR packages, compensation• Supplement international management & experts to support Chinese staff • Switch Representative office to a legal entity / trading company to penetrate the Chinese market

with distributor network and direct sales• Strategic repositioning of office location in China

+21% 2010

+33% 2009

+7% 2008

-1% 2007

12% 2006

Growth in %

Miltenyi Biotec Singapore / Asia Pacific

Miltenyi Biotec Asia Pacific Pte Ltd.

Inception 2003

Office 1 / Singapore

Employee increase since inception + 50%

Contribution to MB group revenue (2010) 3%

Contribution to APAC revenue (2010) 23%

Average growth 2006 - 2010 20%

Clinical / Research split 17 / 83+8% 2010

+19% 2009

+28% 2008

+14% 2007

+32% 2006

Growth in %

Review . Challenges . Opportunities

Miltenyi Biotec Australia

Miltenyi Biotec Australia Pty. Ltd.

Inception 2003

Office 1 / Sydney

Employee increase since inception + 50%

Contribution to MB group revenue (2010) 2%

Contribution to APAC revenue (2010) 14%

Average growth 2006 - 2010 12%

Clinical / Research split 7 / 93

+29% 2010

+17% 2009

+14% 2008

+8% 2007

-7% 2006

Growth in %

Review . Challenges . Opportunities

Miltenyi Biotec Japan

Miltenyi Biotec K.K.

Inception 2003

Office 1 - Tokyo

Employee increase since inception + 30%

Contribution to MB group revenue (2010) 8%

Contribution to APAC revenue (2010) 52%

Average growth 2006 - 2010 12%

Clinical / Research split 7 / 93

+15% 2010

+18% 2009

+1% 2008

+6% 2007

+28% 2006

Growth in %

Review . Challenges . Opportunities

• 2008/2009 change in Management

• 2011 Miltenyi Biotec Japan – number one Life Science company in Japan

Miltenyi Biotec Asia Pacific Region

Miltenyi Biotec APAC region

Inception 2003 - 2008

Offices 1 - Shanghai, 1 - Beijing1 - Singapore 1 - Tokyo1 - Sydney

Employee increase since inception + 20%

Contribution to MB group revenue (2010) 15%

Average growth 2006 - 2010 13%

Clinical / Research split 20 / 80

Challenges & Opportunities

• Future growth and expansion can only be realised by setting the right Management structure and functions.

• Dedicated experts for the specific region are key to drive strategic and operative changes within the APAC region.

• Close mentorship by Headquartermanagement has to be accepted and lived in the entire organisation.

• It is all about people management and the right management mix. Headquarter globally is taking part in exchange programs between subsidiaries to mutually prepare management to fit the geographical needs.

• Due to Miltenyi‘s large and diverse product portfolio, experts with indepth market knowledge combined with the right touch for regional specific business models and opportunities are needed.

• Central logistical hub in the APAC region to overcome constant delivery bottlenecks• Strategic repositioning of office location in China

Global Marketing teams and Global employee exchange programs to fit global needs

RoW

US / Canada

EX EuropeAsia Pacific

Europe

USA

Malaysia

United Kingdom

Vietnam

Turkey

Switzerland

CryoMACS 2010 vs Baxter Cryocyte sales

CryoMACSFreezing Bags

CryoMACS 2010 vs Baxter Cryocyte sales

CryoMACSFreezing Bags