Business description of Organon--Co from last 10-k form
¹ Indicates, in this 2021 Form 10-K, brand names of products, which are not available in the United States.
² Indicates brand names of products which are trademarks not owned by Organon. Specific trademark ownership information is included in the Exhibit Index at the end of this 2021 Form 10-K.
PART I
Overview
Organon & Co. ("Organon") is a global health care company formed through a spinoff from Merck & Co., Inc. ("Merck") to focus on improving the health of women throughout their lives. Organon's focus is on women's health as its primary therapy area, and is the only large global pharmaceutical company currently in existence to do so.
Organon has a portfolio of more than 60 medicines and products across a range of therapeutic areas. Organon is a global health care company that develops and delivers innovative health solutions through a portfolio of prescription therapies within women's health, biosimilars and established brands (the "Organon Products"). Organon sells these products through various channels including drug wholesalers and retailers, hospitals, government agencies and managed health care providers such as health maintenance organizations, pharmacy benefit managers and other institutions. Organon operates six manufacturing facilities, which are located in Belgium, Brazil, Indonesia, Mexico, the Netherlands and the United Kingdom ("UK").
Organon's operations include the following product portfolios, which constitute one operating segment engaged in developing innovative health solutions:
•Women's Health: Organon has a portfolio of contraception and fertility brands, including Nexplanon® (etonogestrel implant) (sold as Implanon NXT™ in some countries outside the United States), a long-acting reversible contraceptive, which is a class of contraceptives that is recognized as the most effective type of hormonal contraception available to patients with a lower long-term average cost. Organon's mission is to be the world's leading women's health company and to deliver a better and healthier every day for every woman. Organon plans to continue building on its strengths in reproductive health and fertility as it assembles a suite of health options that help address the areas of high unmet needs for women from adolescence to menopause and beyond.
•Biosimilars: Organon's current portfolio spans across immunology and oncology treatments. Organon plans to continue evaluating opportunities in other potential therapeutic areas, including ophthalmology, diabetes and neuroscience. Organon's oncology biosimilars have been launched in 20 countries and Organon's immunology biosimilars have been launched in five countries. All five biosimilars in Organon's portfolio have launched in certain countries globally, including two biosimilars in the United States. Organon expects to grow its existing portfolio through future launches in other therapeutic areas, both through Organon's partnership with its development partner, Samsung Bioepis, as well as through other potential partners. Organon's existing biosimilars portfolio positions Organon for success in this attractive and fast growing area of health care with several major biologics that will lose patent protection in the next decade.
•Established Brands: Organon has a portfolio of established brands, which generally are beyond market exclusivity, including leading brands in cardiovascular, respiratory, dermatology and non-opioid pain management. A number of Organon's established brands lost exclusivity years ago and have faced generic competition for some time, yet still contribute meaningful profitability. Organon intends to stimulate the performance of its established brands products through renewed focus and attention on strategic marketing to create a significant source of capital to fuel its growth aspirations. Organon believes its established brands products will, over time, continue to deliver meaningful revenue and operating profit that can be redirected into organic and inorganic growth opportunities in key product areas and geographies. Organon's established brands portfolio is supported by its large commercial and manufacturing capabilities, including a global network that enables Organon to distribute products to patients in more than 140 countries and territories.
Led by the women's health portfolio coupled with an expanding biosimilars business and stable franchise of established medicines, Organon's products produce strong cash flows that will support investments in innovation and future growth opportunities in women's health. In addition, Organon is pursuing opportunities to collaborate with biopharmaceutical innovators looking to commercialize their products by leveraging its scale and presence in fast growing international markets.
Since becoming a standalone company, Organon has expanded its women's health portfolio through four acquisitions:
•Acquired Alydia Health, a commercial stage company focused on the treatment of postpartum hemorrhage.
•Entered into a licensing agreement with ObsEva for the global development, manufacturing and commercial rights to ebopiprant (OBE022), an investigational agent being evaluated as a potential treatment for preterm labor.
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•Acquired Forendo, a clinical-stage drug development company whose lead candidate, FOR-6219, is an investigational agent being evaluated as a potential treatment for endometriosis, and whose pipeline also includes a pre-clinical program targeting polycystic ovarian syndrome (PCOS).
•Entered into an agreement to acquire the rights to Marvelon™ (ethinylestradiol, desogestrel)¹ and Mercilon™ (ethinylestradiol, desogestrel)¹ (two combined hormonal oral contraceptives) in several Asian markets, adding to the 20 markets where Organon already maintained rights to these products.
Spinoff from Merck
On June 2, 2021, Organon and Merck entered into a Separation and Distribution Agreement (the "Separation and Distribution Agreement"). Pursuant to the Separation and Distribution Agreement, Merck agreed to spin off the Organon Products into Organon, a new, publicly traded company (the "spinoff"). Organon is now a standalone publicly traded company, and on June 3, 2021, regular-way trading of Organon's Common Stock (the "Common Stock") commenced on the New York Stock Exchange under the ticker symbol "OGN."
The spinoff was completed pursuant to the Separation and Distribution Agreement and other agreements with Merck related to the spinoff including, but not limited to, a tax matters agreement (the "Tax Matters Agreement" or "TMA"), an employee matters agreement the ("Employee Matters Agreement") and a transition services agreement (the "Transition Services Agreement" or "TSA") (see Note 19 "Third-Party Arrangements and Related Party Disclosures" to the Financial Statements included in this report for additional details).
Organon is engaged in developing and delivering innovative health solutions through a diverse portfolio of products serving patient needs across multiple therapeutic areas and product categories, consisting of women's health, biosimilars and established brands. These portfolios are further described below, together with select details for products within each group. Organon's sales for each of its product groups are as follows:
Women's Health
Biosimilars
Established Brands
In 2021, Organon's products recorded revenue of $6.3 billion. Organon operates on a global scale and Organon's global network enables it to distribute products to patients in more than 140 countries and territories, with approximately 80% of 2021 revenue, or $4.9 billion, generated outside the United States.
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Women's Health Portfolio
In 2021, Organon's women's health portfolio accounted for $1.6 billion, or approximately 26%, of Organon's sales, with approximately 48%, or $767 million, generated outside the United States. Organon's women's health products are sold by prescription primarily in two therapeutic areas, contraception, with key brands such as Nexplanon® and NuvaRing, and fertility, with key brands such as Follistim¹ and Elonva¹. Additionally, Organon continues to assess commercialization opportunities in conditions unique to women or disproportionally affecting women, such as the Jada system acquired as a part of the acquisition of Alydia Health. Organon's women's health products are sold in over 90 markets worldwide, including the United States, China, Canada, Australia, Brazil, and Mexico as well as many other countries in the European Union ("EU"), South America, Asia, and Africa.
Contraception
Organon's contraception portfolio currently consists of the following products, which prevent pregnancy by suppressing ovulation:
Nexplanon is a prescription medication for the prevention of pregnancy in women lasting up to three years and is reversible upon removal. Nexplanon is a small, thin and flexible arm implant that is placed discreetly under the skin of the inner, upper arm by a health care provider. It is a progestin-only, radiopaque, removable implant, containing 68 mg of etonogestrel pre-loaded into an applicator and is typically prescribed in women who are not looking to become pregnant in the near future and do not want to take a daily contraceptive.
NuvaRing (etonogestrel / ethinyl estradiol vaginal ring) is a monthly vaginal contraceptive ring with a combination of progestin and estrogen used to prevent pregnancy in women. NuvaRing is prescribed for women that want a monthly contraceptive option.
Cerazette™ (desogestrel) is a progestin-only, daily pill used to prevent pregnancy in women. Progestin-only products like Cerazette are typically used by women wanting hormonal contraception for whom estrogen-containing contraceptives may not be medically appropriate. Cerazette is not approved or marketed in the United States but is available in certain countries outside the United States.
Marvelon¹ and Mercilon¹ (desogestrel and ethinyl estradiol pill) are both combinations of progestin and estrogen used as daily pills to prevent pregnancy. Marvelon¹ contains a higher daily dose of estrogen than Mercilon¹. Marvelon¹ and Mercilon¹ are not approved or marketed in the United States but are available in certain countries outside the United States.
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Fertility
Organon's fertility portfolio currently consists of three products used primarily for in vitro fertilization ("IVF") treatment cycles:
Follistim (follitropin beta injection)¹ which is marketed as Puregon™ in most countries outside the United States, contains human follile-stimulating hormone (“FSH”) and is used to promote the development of multiple ovarian follicles in assisted reproduction technology procedures, such as IVF, embryo transfer, gamete intrafallopian transfer and intracytoplasmic sperm injection. Follistim¹ belongs to the group of gonadotrophic hormones used by women trying to get pregnant using IVF.
Elonva™ (corifollitropin alfa)¹ is an ovarian follicle stimulant with the same mechanism of action as recombinant FSH, but characterized by a prolonged duration of FSH activity. Due to its ability to initiate and sustain growth of multiple ovarian follicles for an entire week, a single subcutaneous injection of the recommended dose of Elonva¹ may replace the first seven injections of any daily recombinant FSH preparation in an ovarian stimulation treatment cycle. Elonva¹ belongs to the group of gonadotrophic hormones used by women trying to get pregnant using IVF.