Full Year 2025 Hikma Pharmaceuticals PLC Earnings Call
Said Darwazah: I am very pleased to be speaking with you today. It is good to be in the CEO role again. I want to kick off by focusing on four key things. The first is stability. I am laser-focused on getting the group onto a stronger and more stable footing. I want to reassure our people, our investors, and all our stakeholders that we have a very strong business and many exciting opportunities ahead. The second is agility. I want to rebuild a culture of quick decision-making, flexibility, and responsiveness. Over the past few years, we have lost a bit of the entrepreneurial culture that the company was founded on. I want to empower our leaders to take decisions and drive accountability. The third is investment. We need to accelerate investment in the business, in talent, in technology, in our facilities, and more importantly, in R&D.
Again.
I want to kick off by focusing on four key things the first is stability.
I am laser focused on getting the group onto a stronger and more stable footing.
I want to reassure our people our investors and all our stakeholders that you'd have a very strong business and many exciting opportunities ahead.
The second is agility.
To rebuild the culture of quick decision, making flexibility and responsiveness.
Over the past few years, we have lost a bit of them to vanilla culture that the company was founded on I want to empower our leaders to take decisions and drive accountability.
The third is the investment we need to accelerate the investment in the business.
In talent and technology, and our facilities and more importantly, an R&D investment to fuel growth and we need to make sure that we are investing exactly what do we need to for the long term and finally of course long term growth. This is our priority stepping in as CEO I am.
Said Darwazah: Investment fuel growth, we need to make sure that we are investing exactly where we need to for the long term. Finally, of course, long-term growth. This is our priority. Stepping in as CEO, I am ensuring that we are focused on striking a better balance between optimizing margin and pursuing sustainable profit growth. To deliver the first two, stability and agility, we've refined our management structure, and I will walk you through how we plan to run the business for the next couple of years. Then present our 2025 full year results and walk you through both the highs and the lows of the year so that you have a very clear picture of where we stand today.
Ensuring that we are focused on striking a better balance between optimizing margin and pursuing sustainable profit growth.
To deliver the first two stability and agility, we've refined our management structure and I will walk you through how we plan to run the business for the next couple of years.
We then present, our 2025 full year results and walk you through both the highs and lows of the so that you have a very clear picture of where we stand today.
Said Darwazah: Finally, we'll explain where we go from here, what we'll be focusing on in 2026 and in the coming years, where we will be investing, and how we will drive sustainable growth. Hikma is a great company with three impressive, diverse businesses, and despite the challenges we faced this year, we have so much confidence in our future. We've taken a lot of action in the past two months, and we'll continue to take action in the months ahead to set things straight so that we can continue on our clear path to grow. One of the most important things we have done is mobilize and energize our teams. We have great talent at Hikma. Many of our very capable and experienced leaders have been with us for a long time, and other more recent joiners have brought great industry experience and excellent track records.
And finally, we'll explain where do we go from here.
We will be focusing on in 2026 and in the coming years to where we would be investing and how we will drive sustainable growth.
Hikma is a great company with three impressive diverse businesses and despite the challenges we faced this year, we have so much confidence in our future.
Taken a lot of action in the past two months and will continue to take action in the months ahead to set things straight. So that we can continue on a clear path to grow.
One of the most important things we have done is mobilize and energize. Our teams we have data until taken by many of our very capable and experienced leaders have been with us for a long time and other more recent joiners have brought great industry experience and excellent track records.
Said Darwazah: They are embracing the changes and moving the business forward. To help me in the day-to-day management of the business and to ensure that we start moving faster and more effectively, we have created two new Deputy CEO positions. Mazen, who's currently the vice chairman and president of MENA, has been appointed Vice Chairman and Deputy CEO, MENA, with responsibility now for all our activities in MENA. What's new is that MENA Injectables will now report directly to him and his team. Khaled will take on the role of Deputy CEO, North America and EU. He will oversee all Hikma activities in North America and Europe, and he will be accountable for delivering both the Hikma Rx and Injectable North America and Europe results. Khaled will step down from the role of the CFO.
They are embracing the changes and moving the business forward.
To help me in the day to day management of the business and to ensure that we start moving faster and more effectively we have created two new deputy CEO positions imagine who is currently the vice chairman and President of Mena has been appointed Vice Chairman and Deputy C O Mena with responsibility now for all.
Our activities in Mena.
What's new is that Mena Injectables will now report directly to him and his team.
Carlo will take on the role of Deputy CEO of North America, and EU. He will oversee all hikma activities in North America, and Europe, and it will be accountable for delivering both the Hikma Rx and injectable North America and Europe results.
I'll, let was stepped down from the role of the CFO. The board has initiated a search for a new CFO and in the interim Arab I'll call D. Currently VP finance will become acting CFO until a permanent CFO is appointed.
Said Darwazah: The board has initiated a search for a new CFO, and in the interim, Areb Al Kurdi, currently VP Finance, will become Acting CFO until a permanent CFO is appointed. Hafrun, currently Global Head of R&D, and President, Hikma Rx, will add management of our Injectables commercial activities in the US to her responsibilities and will become President, US, in addition to her R&D role. At the board level, I will relinquish my Executive Chairman responsibilities to fully focus on being CEO. Victoria Hull, our Senior Independent Director, will step into the Chair role, and Douglas Hirt, our Audit Committee Chair, will assume the Senior Independent Director role. We have also identified some talent gaps, and we are actively recruiting new talent where appropriate or promoting from within.
Have room currently global head of R&D, and President take MA X will add management of our Injectables commercial activities in the U S. The responsibilities and will become President U S. In addition to her RMB euro.
And at the board level I would relinquish my executive chairman responsibilities to fully focus on being CEO.
Story ahead of our sooner independent director will step into the chair role and Douglas hurt our audit Committee chair will assume the senior independent director role.
We have also identified some talent gaps and we are actively recruiting new talent were appropriate or promoting from within.
Said Darwazah: I feel that we've put together an organizational structure that is practical and leverages the strong talent that we have across the business. The changes will enable us to address our challenges and execute group strategy with more agility and greater accountability. Moving on to our 2025 results, we have delivered a solid group performance in line with our guidance. Thanks to strong momentum in our Branded and Hikma Rx businesses and growth in all geographies, we grew revenue by 6% and core operating profit by 3% and maintained resilient margins. Our EBITDA margin was a very healthy 25.5. As we flagged over the course of 2025, Injectables profitability was impacted by our product and geographic mix, and it is clear that further focus on and investment in this business is now needed to ensure a stronger growth trajectory going forward.
I figured that you put together an organization structure that is practical and leverages. The strong talent that we have that across the business. The changes will enable us to address our challenges and execute group's strategy with more agility and greater accountability.
Moving on to our 2025 results, we have delivered a solid group performance in line with our guidance.
That's the strong momentum in our branded their hekmati businesses and growth in all geographies, we grew revenue by 6% and core operating profit by 3%.
<unk> maintains a resilient margins our EBITDA margin was a very healthy 25.5.
As we flagged over the course of 'twenty 'twenty five injectable profitability was impacted by our product and geographic mix and it is clear that further focus on and investment in this business is now needed to ensure a strong growth trajectory going forward.
Said Darwazah: Our cash generation remains very strong, and I'm very proud that our return on invested capital remains in the mid-teens. We have an excellent track record of consistently delivering high returns, and I am committing to maintaining them around this level. Now, let me hand over to Khaled, who will take us through the 2025 performance in more detail.
Our cash generation remains very strong and I'm very proud that our return on invested capital remains in the mid teens, we have an excellent track record of consistently delivering high returns and I am committed to maintaining them around this limit.
Let me hand over to <unk>, who will take us through the 2025 performance in more detail.
Khalid Nabilsi: Thanks, Said. Let me start with Branded. The Branded business had an excellent year. Revenue increased 10% with a core operating margin of 26.4%. We grew double digit in both of our largest markets, Algeria and Saudi Arabia, and saw good growth in most other markets across the MENA region. This growth reflects our focus on launching more complex and higher-value products, where we continue to make good progress and gain market share in key therapeutic areas. We saw a particularly strong performance from certain diabetes and oncology products. IQVIA data shows that our diabetes portfolio grew by nearly 40% during the year, outpacing the market growth of 17%. In oncology, over the past five years, our CAGR is 35% versus the market growth of around 10%.
Thanks, Syed let me start with the branded.
The branded business had an excellent year.
Revenue increased 10%.
With a core operating margin of 26, 4% with.
We grew double digit in both of our largest markets, Algeria, and Saudi Arabia, and so good growth in most other markets are close to them in that region.
This growth reflects our focus on launching more complex and higher value products, where we continue to make good progress and gain market share in key therapeutic areas.
We saw a particularly strong performance from certain diabetes and oncology products.
Our Q via data shows that our diabetes portfolio grew by nearly 40% during the year.
Outpacing the market growth of 17%.
In oncology.
Over the past five years, our key good is 35% versus the market growth of around 10%.
Khalid Nabilsi: We are also leveraging partnerships to bring more innovative products to our markets across a variety of therapeutic areas. We are now the largest pharmaceutical company by sales in MENA, an achievement we are hugely proud of, and we expect the business to continue to build on this strong momentum. Now, turning to Hikma Rx, this business had another good year, generating over $1 billion in revenue, which was in line with our expectations. The base business performed extremely well during the year, with good demand for our more differentiated products like generic Advair and fluticasone nasal spray. Price erosion was mid-single digit, which was in line with our expectations. Core operating margin was ahead of expectations at 17.3%, driven by reduced sales and marketing costs following the outsourcing of Glaxo.
We are also leveraging partnerships to bring more innovative products to all other markets across a variety of therapeutic areas. We are now the largest pharmaceutical company by sales in Mena and achievement, we are hugely proud of.
And we expect the business to continue to build on the strong momentum.
Now turning to Hikma IDEXX.
This business had another good year generating over 1 billion in revenue, which was in line with our expectations the base business performed.
<unk> during the year with good demand for our more differentiated products like generic advair and fluconazole nasal spray.
So I'll see erosion was mid single digits, which was in line with our expectations.
Core operating margin was ahead of expectations at 17, 3% driven by reduced sales and marketing costs. Following the outsourcing of clocks huddle contract manufacturing remains an important contributor to this business and that has been good progress in preparing our Columbus site for the significant upcoming.
Khalid Nabilsi: Contract manufacturing remains an important contributor to this business, and there has been good progress in preparing our Columbus site for a significant upcoming CMO contract, and we expect to see revenues linked to this contract in 2026. The injectable business delivered a strong top-line performance, growing 7%, which is in line with the guidance we set at the beginning of the year. North America, sales grew 5%. This reflects a full-year contribution from the Xellia acquisition and recent launches, which more than offset increased competition on certain products in our base business, which we flagged over the course of the year. In Europe, we grew 23%, reflecting strong performance across both our established and recently entered markets, in particular, Germany and France. In MENA, we grew 9%, supported by strong performance from in-licensed biosimilar and innovative products.
Coming CMO contact.
And we expect to see revenues linked to this contract in 2026.
The injectable business delivered strong topline performance growing 7%, which is in line with the guidance we set at the beginning of the year.
North America sales grew 5%. This reflects a full year contribution from the zinnia acquisition and recent launches, which more than offset increased competition on certain products in our base business, which we flagged over the course of the year.
In Europe, we grew 23%.
Selecting strong performance across both our established and recently entered the market in particular, Germany and France in Mena, We grew 9% supported by strong performance from unlicensed biosimilars and innovative products.
Khalid Nabilsi: Core operating profit was down 6%. Core operating margin declined from 35% to 31%. I'd like to drill down a bit into the margin decline in injectables so that it is very clear why the margin is coming down and what we expect in terms of margin going forward. In 2024, our injectable operating margin was around 35%. Over the course of 2025, a few things happened that put pressure on margin. First, we saw competition on two of our highest-margin products, testosterone and calcitonin. Second, we were able to offset this lost revenue with growth in Europe and MENA. MENA sales, in particular, came at a lower margin. Third, partner and third-party manufactured products also helped to drive top-line growth. These products have a lower margin due to royalty and profit share arrangement.
Core operating profit was down 6% and core operating margin declined from 35% 31%.
I'd like to drill down a bit into the margin decline in injectables. So that it is very clear why the margin is coming down and what we expect in terms of margin going forward.
In 2024 hour injectable operating margin was around 35%.
Over the course of 'twenty 'twenty, four and a few things happened that put pressure on margin.
First we saw competition on two of our highest margin products testosterone and calcitonin.
Second we were able to offset this lost revenue with growth in Europe and Mena.
Mena sales in particular came at a lower margin.
Third partner and third party manufactured products also helped to drive top line growth, but these products have a lower margin due to royalty and profit sharing arrangement.
Khalid Nabilsi: Fourth, we were impacted by the strength of the euro. Finally, at year-end, we had to write down some inventory, namely liraglutide, after the price dropped significantly and some Bancoredy as we transition to TYZAVAN. This accounts for the slight miss to our margin guidance, which came in at 31% versus our guidance range of 32% to 33%. All in all, 2025 was a tough year for injectable profitability. In November, we guided to a 30% floor in margin for this business. We are today guiding lower than this for 2026. What changed? Since November, we have had a management change and have done a deep dive into our projections. Firstly, we are increasing our expectation for R&D spend. This is perhaps one of the most significant drags on margin.
Fourth we were impacted by the strength of the Euro finally at year end, we had to write down some inventory, namely liraglutide after the price dropped significantly.
Someone quality as we transition to <unk> and this accounts for the slight Miss to our margin guidance, which came in at 31% versus our guidance range of 32% to 33%. So all in all 2025 was a tough year for injectable profitability in Nova.
But we got it to a 30% floor and margin for this business. We are today regarding lower than this for 2026. So what changed since November we have had a management change and have done a deep dive into our projections.
Firstly, we are increasing our expectation for R&D spend this is perhaps one of the most significant drag on margin.
Khalid Nabilsi: A priority for 2026 will be to accelerate and execute on R&D projects that were put on hold in 2025. Secondly, we have lowered our expectation for our CMO business. Some of our customers now require domestic US production, which we are not yet able to offer. Thirdly, we have identified gaps in our sales and marketing teams, which we are filling. Finally, we have had to reflect delays in the timing of some product launches. With all of these factors at play, at least for a few years, we expect margins to be closer to 27% or 28%, but we don't want to be held to a strict margin target. As we have been reviewing our business in the past few months, we can see that we have been leaving a lot of opportunities on the table due to the sub 30% margin profile.
For 2026 will be to accelerate and execute on R&D projects that were put on hold in 2025, Secondly, we have lowered our expectation for our CMO business.
Some of our customers now required domestic U S production, which we are not yet able to offer.
Thirdly, we have identified gaps in our sales and marketing teams, which we are feeling and finally, we have had to reflect delays in the timing of some product launches with all of these factors at play at least for a few years, we expect margins to be closer to 27 or 20%.
But we don't want to be held to a strict margin targets as we have been reviewing a lot of business in the past few months, we can see that we have been leaving a lot of opportunities on the table due to the sub 30% margin profile from 'twenty to 'twenty seven we are expecting a return to growth and absolute profit.
Khalid Nabilsi: From 2027, we are expecting a return to growth in absolute profit. We aim to strike a better balance between optimizing margin and pursuing sustainable profit growth. Importantly, at a group level, we do not expect injectables to be a drag to margins, given the strong ongoing performance of Hikma Rx and Brand. Turning to cash flow and balance sheet, we continue to have a healthy balance sheet. We ended the year with a net debt to core EBITDA ratio of 1.6x. This is up slightly from last year. Our total debt went up around $300 million due to legal settlement, CapEx increases, and product acquisitions. We were pleased to be upgraded to a BBB credit rating from both S&P and Fitch during the year.
We aim to strike a better balance between optimizing margin and pursuing sustainable profit growth importantly at a group level, we do not expect injectables to be a drag to margins given the strong ongoing performance pick MA X and then.
Turning to cash flow and balance sheet, we continue to have a healthy balance sheet. We ended the year with a net debt to core EBITDA ratio of one six times.
This is up slightly from last year.
Our total debt went up around $300 million due to legal settlement capex increases and product acquisitions.
We were pleased to be upgraded to a triple b credit rating from both S&P and Fitch during the year.
Khalid Nabilsi: We are continuing to invest in capacity expansions and upgrades to our sites across North America, MENA, and Europe, which is reflected in our increased CapEx in 2025 of close to $200 million. Operating cash flow, excluding the one-off legal settlement, grew by 10%. That wraps up 2025. Now, Said will take a look at the growth drivers for 2026 and beyond for each of our businesses.
We are continuing to invest in capacity expansions and upgrades to our sites across North America, Mena and Europe, which is reflected in our increased capex in 2025 of close to 200 million.
Operating cash flow, excluding the one off legal settlement grew by 10% that drops up 2025 now side will take look at the growth drivers for 2026 and beyond for each of our businesses.
Said Darwazah: Thank you, Khalid. Let's start with injectables. I am very optimistic about the potential of this business. The opportunities are there. We just need to focus our efforts and make sure we are investing as much as we can in the right products and capacity. The way we will be managing the business from today will enable us to sharpen our focus on each of our markets. In North America, Hafrun will oversee our commercial efforts. She will be supported by Jon Kafer, VP Commercial of US Injectables, who has more than 30 years' experience in the US hospital market. The MENA injectable teams are the local experts with a track record of signing partnerships and bringing exciting products to the region. This team will be reporting into Mazen going forward as part of his broader MENA role.
Thank you Charlotte, let's start with Injectables.
I am very optimistic about the potential of this business. The opportunities are there we just need to focus our efforts and make sure. We are investing as much as we can and the right products and capacity.
The way, we would be managing the business for them today will enable us to sharpen our focus on each of our markets in North America, absolutely will oversee our commercial efforts. She will be supported by Jon Kafer VP commercial of U S. Injectables was more than 30 years' experience in the U S Hospital market.
The Mena injectable teams or the local experts with a track record of signing partnerships and bringing exciting products to the region. This team who will be reporting in to imagine them going forward as part of its broader I mean at all.
Said Darwazah: Finally, in Europe, Khaled will be overseeing the team as we continue to pursue the rapid growth we have delivered in recent years. Looking at some select drivers of growth, one of our largest near-term opportunities is TYZAVAN, our vancomycin ready-to-use bags. We launched the product in December 2025. We expect steady growth over 2026 and beyond as we look to take market share from other less optimal presentations. We are also exploring launching this product in Europe and MENA through our own commercial teams and out-licensing to partners. Our expansion in Europe has only just begun. As you could see from the strong growth in 2025, there is strong demand for our products in the EU market. We have some good launches planned for the coming years.
Finally in Europe crowded will be overseeing the team as we continue to pursue the rapid growth we have delivered in recent years.
Okay got some select drivers of growth one of our largest near term opportunities outside of Iran. I would've I call my son ready to use beds.
Launch the product in December 2025, and we expect steady growth over 2026 and beyond.
As we look to take market share from other less optimal presentations.
We're also exploring launching this product in Europe, and Mena through our own commercial teams and out licensing to partners.
I would especially in Europe has only just begun.
As you can see from the strong growth in 2025, there's strong demand for our products in the EU markets and.
And we have some good launches planned for the coming years.
Said Darwazah: In MENA, we have continued to strengthen our biosimilar leadership position as we have added 6 new biosimilars to our pipeline. Around one-third of MENA Injectables revenue comes from our portfolio of biosimilars. As we have stated already, we'll be accelerating our investments in Injectables. R&D is a priority, and you will see a big step-up in R&D spend in Injectables in 2026 and 2027 to bring the level of spend up to where it should be, around 5% to 6% of revenue. We'll be focusing on adding differentiated and more complex products to our portfolio. There is more to come on this in a few minutes from Hafrun. We are also investing in capacity across our network. Work on Bedford, on the Bedford site continues.
And in Mena, we have continued to strengthen our biosimilar leadership position as we have added six new Biosimilar pipeline.
Around one third of Mena Injectables revenue comes from our portfolio of Biosimilars.
As we have stated already would be accelerating our investments in injectables.
R&D is a priority and you will see a big step up in R&D spend in Injectables in 2026, and 2027th to bring the level of spend up to where it should be around 5% to 6%.
Revenue.
We would be focusing on added differentiated and more complex for the extra portfolio.
There is more to come on this in a few minutes from afternoon.
We are also investing in capacity across our network work on vet fault on the Bedford side continues to analyze that in line with the update we gave in November which means the site will come online in 2028, that's what it will support our growing pipeline of ICU products.
Said Darwazah: The timelines are in line with the update we gave in November, which means the site will come online in 2028. Bedford will support our growing pipeline of RTU products and add capacity to build a stronger CMO business. The outlook for the Hikma Rx business is very encouraging. We are ramping up readiness for our last CMO contract, are winning new CMO mandates, and expect to see a good contribution from CMO in 2026. This will help to offset of expected erosion of the top line from generic competition on sodium oxybate. At the operating level, profit level, the contribution from sodium oxybate will be neutral to positive. Other important products in this division include generic Advair, which we expect will continue to do well, and fluticasone nasal spray, where we also have a strong market share and manufacturing expertise.
And add capacity to build a stronger CMO business.
The outlook for the Hikma IDEXX business is very encouraging.
We are ramping up readiness for our large CMO contract.
We're winning new CMO mandates and expect to see a good contribution from seal in 'twenty or 'twenty six.
This will help to offset of expected erosion of the top line from generic competition on sodium Auxilium Bates.
At the operating level profit level the contribution from sodium observation will be neutral to positive.
Other important products in this division include generic Advair, which we expect will continue to do well and fluticasone nasal spray what do we also have a strong market share and manufacturing expertise.
Said Darwazah: What is truly impressive about this business is that we have been able to gradually improve the margin while also making a significant increase in R&D spend. We are now guiding for close to 20% operating margin in 2026, which is after an expected significant increase in R&D spend. This increase in R&D spend is essential for the rapid growth in this division over the medium term. Hafrun will cover our R&D priorities in the coming slides. We have reached an impressive milestone in the branded business this year. We are now the number one pharma company by revenue in MENA. We are very proud of this. In this business, our success comes from experienced commercial teams and increasingly complex product portfolio, strong local manufacturing, and strong partnerships.
It is truly impressive about this business is that we have been able to gradually improve the margin while also making a significant increase in R&D spend.
We are now guiding for a growth of 20% operating margin. It went it went to six which is after unexpected significant increase in R&D spend.
This increase in R&D spend is essential for driving growth in this division over the medium term.
Again happened and we'll cover our R&D priorities in the coming slides.
We have reached an impressive milestone in the branded business. This year. We are now the number one pharma company by revenue in Mena.
We are very very proud of this.
In this business our success comes from experience commercial teams and increasingly complex product portfolio strong local manufacturing.
<unk> partnerships.
Said Darwazah: We have been signing over a partnership a month across the last few years, and you can see a selection of our partners on this slide. We are focused on therapeutic areas where we see good demand and value and have built market-leading positions in oncology, for example. We have a strong pipeline of products that will launch in the coming years, reflecting our focus on first-to-market or first-generic treatments for chronic illnesses. As with any pharma company, ensuring we have the right pipeline for the future is critical, and we need to make sure that every dollar we spend on R&D counts. We have streamlined our approach and are focusing on the most promising opportunities. I want to pass this over now to Hafrun. In 2025, Hafrun began the transformation of our R&D organization.
You have been signing over a partnership a month across the last few years and you can see a selection of our partners on the slides. We are focused on therapeutic areas, where do we see a good demand and value and have built a market leading positions in oncology for example.
We have a strong pipeline of products that will launch in the coming years, reflecting our focus are first to market. Our first generic statements for chronic illnesses.
As with any pharma company, ensuring we have the right pipeline for the future is critical.
And we need to make sure that every dollar we spend on R&D accounts. So we have streamlined our approach and are focusing on the most promising opportunities.
I want to pass things over now to have flown in 2025. After them began the transformation of our R&D organization. As a reminder, she has extensive experience leading R&D tears and has delivered many many products launches over the course of air carrier. She will tell you more.
Said Darwazah: As a reminder, she has extensive experience leading R&D teams and has delivered many products launches over the course of her career. She will tell you more.
Hafrun Fridriksdottir: Thanks, Said. We made a lot of progress in the transformation of the R&D function when we established the global R&D organization last year. We streamlined the number of projects under development, reorganized the R&D teams into specific focus area, and we have established clear KPIs for the future. The first priority, portfolio balance, is key. We must make sure we are working on the right mix of simple and complex formulations to support the three business units with a steady flow of new revenues to compensate for price erosion and support the growth of the businesses. Adding complexity is about creating longer term opportunities through a focus on complex and differentiated platforms. We are working to build and strengthen our in-house development capabilities in areas like ready-to-use and inhalation formulations. The third priority is manufacturing-driven differentiation.
Thanks side, we've made a lot of progress in the transformation of the R&D function. When we established that global R&D organization last year, we streamline the number of projects under development, we organized the R&D teams into a specific focus area and.
We have established can't Kpis for the future.
The first priority portfolio balance is key.
We must make sure we are working on the right mix of simple and complex formulations to support the three business units with a steady flow of new revenues to compensate for price erosion and supports the growth of the businesses.
Think complexity is about creating longer term opportunities through a focus on complex and differentiated platforms. We are working to build and strengthen our in house development capabilities in areas like ready to use an inhalation formulations.
So that's priority is manufacturing driven differentiation.
Hafrun Fridriksdottir: Our manufacturing strength is a real differentiation for us. We can leverage this to unlock technically challenging product, accelerate development, and improve scalability. Finally, speed. We need to shorten the development timelines and improve the first cycle approval rates to enhance speed to market, capital efficiency, and return on the R&D investment. To deliver this, we have an excellent management team leading our three technology platforms. Two of these leaders were recently hired and bring 20 to 30 years of experience in R&D. Currently, we are developing a range of products aimed at advancing all three business areas. In the US and Europe alone, these products have addressable market size of about $90 billion, presenting a significant growth opportunities. I feel we have a good balance across the various stages of development, with 55% either filed, approved, or tentatively approved, and 55% under development.
Our manufacturing strength is a real differentiation for us and we can leverage this to unlock technically challenging product accelerate development and improve scalability and finally speed, we need to see Austin, the development timelines and improve their first cycle approval rates to enhance speed to market cap.
Capital efficiency and return on that R&D investment to deliver this we have an excellent management team, leading our three technology platforms. Two of these leases that recently hired him being 20 to 30 years of experience in R&D.
Currently we are developing a range of product aimed at advancing all three business areas in the U S and Europe alone. These product have addressable market size of about $90 billion, presenting a significant growth opportunities.
I feel we have a good balance across the various stages of development with 55% either filed or approved or tentatively approved and 55% and the development on <unk>.
Hafrun Fridriksdottir: Eighty percent of our pipeline should get approved before 2030, so we have many opportunities coming in the next few years. These slides give a bit of a better picture of the type of products we will launch, and where, and when. From now to 2029, we expect to launch over 250 products with a good balance across simple and complex formulations across regions. While the number of launches looks to drop off, the complexity increases as we begin to add respiratory and ready-to-use product in the US. In 2026, we are targeting 26 launches in the US for product with a current market size of $6.7 billion, including 9 oral solids and 12 injectables, including 2 complex long-acting injectables.
80% of our pipeline should get approved before to this uncertainty. So we have many opportunities coming in the next two yes.
These slides give a bit odd that the texture of the type of products, we will launch and Riyadh and one from now till 2029, we expect to launch over 250 products with a good balance across simple on complex formulations across regions, while the number of branches looks too.
Off the complexity increases as we begin to add the respiratory and ready to use product in the U S.
In 2026, we are targeting 26 launches in the U S for product, there's a current market size of $6 $7 billion, including nine oral solids, and 12 injectables, including two complex long acting Injectables in 2027, we will launch further three long acting injectables in lung.
Hafrun Fridriksdottir: In 2027, we will launch further three long-acting injectables and one peptide formulation, in addition to simple and complex oral solids. We expect that 2028 will be a big year for launching nasal products. This is when we expect to launch epinephrine nasal spray in the US and two other nasal products. This should also be a good year for injectable ready-to-use pipeline, with three ready-to-use back products to be launched. Let's take a closer look at our ready-to-use plans. Our ready-to-use pipeline has an addressable market of around $1.3 billion. The majority will be submitted via 505(b)(2) pathway, which adds differentiation to product innovation and creates competitive barriers beyond standard generics. The 15 ready-to-use products represent medium to long-term value creation opportunities, with initial loans anticipated from 2028 onwards.
Peptide formulation in addition to simple uncomplicated all at all of our products.
The 2028 will be a big year for launching nasal products. This is money, we expect to launch epinephrine nasal spray in the U S and two other national products. They should also be a good year for injectable ready to use pipeline with three did you use spot product to be launched.
So, let's take a closer look at our ready to use plans are.
What did you use pipeline as an addressable market of around one 3 billion.
And then my daughter tea will be submitted to be at 505, B two pathway without differentiation through product innovation and creates competitive pontius beyond standard genetics.
The 15 ready to use products, 3% medium to long term value creation opportunities with initial launch anticipated from 2028 onward.
Hafrun Fridriksdottir: Our expertise in ready-to-use come from Xellia and the R&D center in Zagreb, which was acquired through the acquisition. TYZAVAN is a great example of the type of ready-to-use product that the Zagreb team can develop. Another focus area is respiratory, nasal, semisolid, and liquids. Here we have 20 products in our pipeline with an addressable market of $18 billion in the US alone. 13 are complex respiratory and nasal drug device combinations with a significant potential. This is an area where we already have a strong market position as the largest supplier of nasal sprays in the US market. I mentioned epinephrine before. This is an important upcoming launch for us in the US in 2028. In addition, we submitted the product in UK last year and will be submitting in Europe this year.
Our expertise and that did you use come from Ixia Leah aren't the R&D center in chocolate, which was acquired through the acquisition anti Salon is a great example of the type of attitude youth product not the chocolate team can develop.
Another focus area is respiratory nasal San Michele language.
Here, we have 20 products in our pipeline.
As an addressable market of 18 billion in the U S alone.
13 accomplished respiratory nasal drug device combinations, there's a significant potential. This is an area, where we already have a strong market position as the largest supplier of nasal sprays in the U S market I mentioned epinephrine before this is an important upcoming launch for us in the U.
It was in 2028.
In addition, we submitted the protest in U K last year and they'd be submitting in Europe. This year, we had a proven success and difficult to develop online and factor in relation product all generic upward being the main one today, our inhalation pipeline coverage around two thirds of the U S respiratory <unk>.
Hafrun Fridriksdottir: We had a proven success in difficult to develop and manufacture inhalation products, our generic Advair being the main one. Today, our inhalation pipeline covers around two-thirds of the US respiratory market and includes blockbusters like GSK Ellipta products, low global warming potential pMDIs, and generic Respimat platform. We are developing these products through our in-house R&D team and strategic partners. Like the nasals, we also see potential in expanding our respiratory franchise beyond the US.... Our solid oral pipeline is a critical for growth in both Hikma Rx and the branded businesses. We have 146 products in this category, with accessible market of $29 billion in the US alone. We have the capacity to develop all kinds of solid oral formulations internally, both simple and complex.
Market and includes blockbuster like D S K I leapt up products.
So global warming potential P N T I's and DNA recipes my platform. We are developing these products through our in house R&D tea and strategic partners like the ne cells. We also see potentially next Monday, our respiratory franchise beyond the U S.
Oh, So did the order pipeline is critical for growth in both Sigma Iraq on the branded businesses. We had 146 products. In this category is accessible market of 2019 in the U S alone we have the capacity to develop all those kinds of solid oral formulations internally, both simple and complex.
Hafrun Fridriksdottir: These three products are a great example of how we have been able to improve the quality of products in this part of our pipeline. As you can see, we are really excited about R&D and investing more now to ensure future growth. We have a strong pipeline and a great teams across the businesses. We look forward to keeping you updated. I now hand it back to Said.
These three products a great example of how we have been able to improve the quality of products in this part of our pipeline.
So as you can see we are really excited about that Randy and investing more now to ensure future growth.
We have a strong pipeline on our great teams across the businesses and we look forward to keeping you updated I now hand, it back to site.
Said Darwazah: Thank you, Khalid. Hopefully, we've been able to provide you with a better picture of the strong potential of the opportunities we are going after. Clearly, there is a lot of work still to do, but I am confident we have the right team in place to deliver it, with a high level of energy and commitment. What does this mean for 2026? We've taken a hard look at the business in the past couple of months, and I believe our guidance reflects a realistic picture of what we can achieve this year, taking into account all of the investments that we plan to make. We expect group revenue to grow in the range of 2% to 4% and deliver $720 million to $770 million of core operating profit.
Thank you have a room.
Hopefully we've been able to provide you with a better picture of the strong potential of the opportunities we are going after.
Clearly, there's a lot of work still to do but I am confident we have the right team in place to live with it with a high level of energy and commitment.
So what does this mean for 2026.
Taking a hard look at the business in the past couple of months and I believe our guidance reflects a realistic picture of what we can achieve this year taking into account all of the investments that we plan to make.
We expect group revenue to grow in the range of 2% to 4%.
And deliver 720 million to 770 million of core operating profit.
Said Darwazah: We expect injectable revenue growth in the low single digits, with core operating margin in the range of 27% to 28%, and branded revenue to grow 6% to 8% in constant currency, with core operating margin of around 25%. We expect Hikma Rx revenue to be broadly flat, with core operating margin close to 20%. As we wrap up, I want to remind you of our track record of delivering attractive revenue and profit growth and high returns. In the past few years, we have delivered mid to high single-digit top-line growth and mid-single-digit profit growth, while maintaining returns on capital in the mid to high teens. Now that I am CEO again full-time, I am confident that we can maintain and even exceed this level of growth and returns in the coming years.
They expect injectable revenue growth in the low single digits with core operating margin in the range of 27 to 28 and branded revenue to grow 6% to 8% in constant currency with core operating margin of around 25%.
They expect hekmati revenue to be broadly flat with core operating margin close to 20%.
As we wrap up I want to remind you of our track record of delivering attractive revenue and profit growth and higher returns.
In the past few years, we have delivered mid to high single digit top line growth and mid single digit profit growth, while maintaining a return on capital in the mid to high teens now that I M. C. O again full time I'm confident that we can maintain and even exceed this level of growth and returns in the coming year.
Yes.
Said Darwazah: I have conviction in our strategy, the clear opportunities we see for the company, and the team that will deliver it.
I have conviction in our strategy the clear opportunities, we see for the company and the team that will deliver it.