2. Characteristics of Industry
The companies in this industry develop
and manufacture drugs that treat a
number of medical issues and diseases
 This industry is a defensive industry, no
matter the state of the economy people
will still need their medicine and
healthcare

•Roche
•Novartis
•GlaxoSmithKline
•SanofiAventis
•Teva

3. Roche Holdings AG


$194.7 Billion
$45.499 Billion
Key figures January-June
In millions
of CHF
% change
2013
Group Sales
Pharmaceuticals Division
Diagnostics Division
Core operating profit
Operating free cash flow
IFRS Net income2
Core earnings per share diluted


23,295
18,162
5,133
9,488
7,445
6,047
7.58
2012 CER*
22,423
17,409
5,014
8,641
7,244
4,312
6.88
CHF USD
5
6
3
10
4
41
12
4
4
2
10
3
40
10
3
3
2
69.34% of Roche’s sales are outside of the U.S.
Pharmaceuticals and Diagnostics

4. Sanofi-Aventis
139,072.80M
 $47,406,000,000


31% of net sales were in the United
States
24%
Western Europe
45%
United States
Other
31%

5. Teva
34.33 B Market Cap
 20.32 B Sales Revenue
 Generic Pharmaceuticals
 21% of its sales come from
Copaxone


Trouble……

6. GlaxoSmithKline





Market Cap - $128,520,000,000
Revenue 2012 - $26,431,000,000
Consumer Health Care, Vaccines, Prescriptions
Headquarters in London and Philadelphia
Traded on NYSE and LSE
Percent of Total Sales by Regions
North America
12.2
21.7
42.8
Europe
EMAP
23.3

Japan
Japanese energy drink, Asthma cure

7. Novartis






$195.14 Billion market cap
$57,561,000,000
Novartis is based in Basel, Switzerland and operate in 140
countries
Alcon is the largest and most profitable in eye care
Sandoz second largest in generic drug companies
Major products include:
Diovan, Lotrel, Gleevec, Zometa, and Neoral

8. Du-Pont Analysis

9. Asset Turnover

10. Debt Cushion & Liquidity

11. Operating and Financial Leverage
Roche
Novartis
GlaxoSmit
hKline
SanofiAventis
Teva
DOL
2.74
3.37
2.51
3.92
4.83
DFL
1.26
1.06
1.12
1.10
1.21
DTL
3.44
3.59
2.82
4.29
5.86

12. DPS
3
2.5
2
Roche Holdings AG
Novartis
1.5
GSK
Sanofiaventis
Teva
1
0.5
0
2008
2009
2010
2011
2012

13. COST OF CAPITAL
GlaxoSmith
Kline
Sanofi
Aventis
Teva
8.55%
9.3%
12%
10.72%
2.75%
0
2.609%
1.881%
3.09%
PERCENT
EQUITY
92.6%
100%
88.27%
91.52%
82.23%
PERCENT
DEBT
7.4%
0
11.73%
8.48%
17.77%
WACC
12.75%
8.55%
8.400%
11.123%
9.257%
Roche
Novartis
N/A
COST OF
EQUITY
9.32%
WEIGHTED
AVG YTM

14. Earnings Per Share
4.5
4
3.5
3
Roche Holdings AG
2.5
Novartis
GSK
2
Sanofiaventis
Teva
1.5
1
0.5
0
2008
2009
2010
2011
2012

15. Value of Firm
350
300
250
200
Current price
Calced Price
150
100
50
0
Roche Holdings AG
Novartis
GSK
Sanofiaventis
Teva

16. CONCLUSION
Roche Holding appears to be the
healthiest company.
 Teva Pharmaceutical Industries Limited
is currently poorest performer
