Galenica AG (SWX:GALE)

Investor Day 2021

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Oct 14, 2021

Ladies and gentlemen, welcome to Interlaken. Welcome at home, in the offices, in front of your screens. Welcome to the Galenica Investor Day, an omni channel in Western Day, physically here in beautiful Interlaken, but also online, different channels linked together. I'm delighted that so many of you participate today on and offline. We have put together an interesting program. In the morning, our CEO starts with the strategic overview, followed by several presentations regarding our strategic programs and initiatives. After each block of presentations, you will have the opportunity to ask questions. So thanks for making the most of this opportunity with some good questions. After the presentations in the morning and the short lunch break, there is an interesting visit to the big laboratories in the afternoon. Now, let us start with our CEO, Marc Wender. Ladies and gentlemen, my colleagues and I are extremely pleased that so many of you can attend today. I'd also like to wish a warm welcome those You follow me online. It makes it even more exciting that we're not only able to welcome you via monitor today, but in real life and face to face, and thanks of the COVID-nineteen certificate, also without the mask. Last spring, I had the pleasure of taking over the management of an extremely solid and healthy company. And yet, last year, we started a significant transformation process. Why and where is this journey taking us? For many decades, Gardenica's main focus was on logistics. From 1995 onwards, a major Strategic change was initiated. The further development of activities with the vertical diversification of both the group's own products and then from the year 2000 onward, the creation of an own pharmacy network. And now, 20 years later, we are initiating the next strategic step. Gallenica aspires to become a fully integrated, interconnected health care service provider. Our patients and customers are always at the heart of everything we do. And that is also the core message of our customer promise. We support people at every stage of life on their journey towards health and well-being. The customers and patients are the ones we want to support. And as through the direct offers like in the B2C market homebuyer services for healthcare professionals, such as those offered in B2B market, so they can better meet the needs of the customers and patients. This development is based on our unique business model. We manage the largest network of pharmacy in Switzerland and systematically expanded with a variety of online channels. We offer an attractive portfolio of products and services to the specialist retail trade as well as in our pharmacies. We're also leading in the areas of healthcare logistics and digital solutions for the healthcare market. All that makes us a strong, attractive partner for all players in the health care market. And the wonderful thing about this next strategic step, our next information is we are able to take it from a position of strength. Thanks to the outstanding effort of our colleagues at Galenica over the past years, even over the past decades. I would now like to take a moment to briefly pay tribute to my predecessor, Jean Claude Glamourst. He suffered cardiac arrest while on back tour a few weeks ago and passed away at just 59 years of age. Jean Claude had been the CEO of the Galenica Group from Exai Pio until the end of March 2020 and handed over a company to me and my colleagues That was in excellent shape. He took early retirement and had lots of big plans and advances ahead of him. Unfortunately, he had to leave us much too soon. Rest in peace, dear Shantel. While COVID-nineteen didn't create consumers' need for digital solutions, it did accelerate the trend enormously. And in general, the world is changing faster and faster. I'm convinced that this is one of the biggest Challenges facing us all, the growing pace of change. And that pace will continue to accelerate, thanks to or possibly because of The inexorable advance of digitalization. For us, that means the future isn't an extension of the past. We want to actively shape the future. That requires our ability to constantly change and evolve or even transform. Among other things, the purpose of the transformation is to help us to meet the changes of digital age and to be able to adapt to ever more rapidly changing markets. What does that mean for the health care market and for Gallienica? Digitization is clearly lagging behind in the health that sector. Compared with other industries, it quickly becomes evident that there's a need for more integrated digitalization And that there is some catching up to do. We want to be on the front line to help shape this development. Consumer behaviors are changing, not because of COVID-nineteen, but the coronavirus pandemic has accelerated some of the trends. As a result, something that might have taken 5 years before the pandemic is now happening in 5 months. And things won't go back to the way they used to be before COVID-nineteen. Interconnectedness will become an important aspect. It will drive success between service providers. And by service providers, I mean all those partners in the health care sector that are important for the patient or the customer. Interconnectedness is a success factor for the entire healthcare market and for the society in general. This interconnectedness is also a pivotal factor when it comes to increasing efficiency and effectiveness throughout the entire system. Toast pressure as well will remain high in the next few years. Digitizations can also help there by simplifying process costs and thereby eliminating some costs from the system. Coast pressure and our aging society make an increase in outpatient treatment options necessary and desirable. This is not a development that we intend to exploit. Therefore, we are expanding our service offerings for customers and patients, such as elderly and people with chronic illnesses. Patients want and should receive as much outpatient treatment as possible. They want to be cared at home. There is an enormous pressure to tackle these upcoming challenges as cost efficiently as possible. That's where our offerings come in. These trends and changes are all important factors. Both the health care market as a whole and Kolenika's business activities. We've sharpened the Galenica story on that basis. And with the new leadership Structure and strategic programs, we have created the conditions necessary to make that story a reality. With our strategic programs, we address the B2C and the B2B market. Our ranges of products and sales perfectly meets the needs of the participants on both markets. The goal based on the customer promise is to offer customers and patients alike the very best possible customer experience on every Channel. With our omni channel therapeutic program, we therefore focus on creating the best possible pharmacy network, one that consists of the pharmacies themselves, the online jobs and our offerings for patients at home. And in parallel, building the digital infrastructure needed, an interconnected infrastructure that integrates and coordinates both the personal and digital point of contact. Thomas Zoran will explain what we've already done to that end and what's still left on the agenda. The offering is a widely part of providing the very best possible customer and we continuously work on developing and expanding our product range accordingly. We have been able to announce several acquisitions and new partner products over the past few months. Stefan Melti, CEO of Air Fora, We'll tell you more about those later. In all these activities, the pharmacy will always play a central role in our sales structure now and in the future. We want to continue positioning and strengthening it as a first point of contact for health care advice, not only with respect to advice and sales of medicine and health care products, but also in terms of new services. In conclusion, the goal of the omni channel strategic program is to acquire new customer groups, increase the number of loyal customers, and in doing so, boost sales and profit. Under the Care Strategic Program, we take up the issue I mentioned earlier, implement them and develop them further. This includes need based health care and therapeutic services as well as 1st class customer services for priority indications. All of this from prevention right through to therapy. With the goal of improving our customers' quality of live by supporting them as their first point of contact for health care advice in our pharmacies, digitally and at home. We don't want to and cannot do all of this on our own. Partnerships are key success factor in the CARE program. Our extensive service offerings makes us attractive for establishing New cooperation models with existing partners and with new partners. We aim to become the preferred cooperation partner in the part in the health care sector, especially for health insurers. Daniel Madonna will explain where we stand on that various point. In summary, we want to use care to strengthen our customer reality, acquire new customers and with our service, contribute significantly to the result of the group. Now let's talk about the Professional Strategic Program, which is designed to address both our business and the entire health care market. What do we want to achieve through this program? Professionals covers our traditional logistics business. We want to be the 1st choice when it comes to logistics services for all marketplace, including pharmacies, drug stores, doctors, there's hospitals and care homes as well as for our partners and our suppliers. 2 of the central themes in professionals are patient safety and efficiency in the healthcare system. We also aspire to make a significant contribution in these areas as well. Digitization is being included in all our activities, also in the professional strategic program. We have set ourselves the goal of being a leader in eHealth, notably by developing and marketing innovative solutions to promote digitizations and by setting standards in the provision of health databases. Lukas Alterman will offer more information about these topics later. As mentioned, professionals focus on the health care market as a whole. Our goal is to strengthen the entire specialist retail trade in the Swiss healthcare market. We intend to do this by continuously Our product portfolio to create an optimal range. At the same time, we want to be an attractive distribution partner for suppliers, offering product representation, marketing and distribution. Andreas Koch will present a few examples from the professional program later. In a nutshell, we are pooling the expertise of the entire group in our professional strategic program to create unique packages with added value for the B2B market. In doing so, we also want to gain new customer groups. These activities all make a major contribution towards Galenic Gaspeci's success. In everything we do, our ongoing responsibility is to streamline our offerings even further and to organize the company itself in a way that is simpler and easier to understand for our customers, our partners as well as for other employees. We have pooled these responsibilities in the efficiency program. And how we are doing that? By systematically making use of our synergies by working together to simplify our strength processes and systems by harmonizing them across the group and by digitizing them where it makes sense. We're also doing this by consciously incorporating our employees' ideas and suggestions. The goal of efficiency is to create better customer experience, reduce costs and in doing so, contribute to the long term success of the Galenic Group. Last but not least, we as a company and as an organization have to Develop further. Our transformation strategic program centers around our employees and working methods. We support the continuous development of other employees. This is the only way to ensure that our employees can perform to their full potential with the right attitude and skills. After all, we'll only succeed in preparing Gallenica for the future with the help of all our employees. We see ourselves as servant leader. What does that mean? We just decide which direction to take and help employees offer the best possible customer experience. We want to work with as few hierarchies as possible and instead build strong teams that work across that work together across organizational boundaries. Decisions shall be taken where the greatest knowledge is. Our new leadership structure is based on this philosophy. Another aspect for our working methods is that we are agile. How do we live agility at Galenica? By focusing on what's important when we collaborate, by taking things one step at a time and responding quickly to changes, by trying out new things, learning from them, making changes when needed, by involving customers as early as possible and achieving initial results quickly. Our organization development is a foundational element of our transformation strategic program. We have made great progress with it over the past 18 months. The organization has received these changes very positively and has also implemented them very quickly and consistently. We're working on transitioning Galenicar to a new chapter of its history to become a fully integrated, interconnected health care service provider. That focuses its full attention on customers and patient, both for the product and services it provides directly as well as the services it provides for all professionals that support and guide customers and patients. All this with a high level of expertise in professionalism and with groundbreaking digital solutions and databases. Taking in their entirety, our activities not only create added value for our company and stakeholders, they also help to contribute to creating modern, efficient health care system. And that, in turn, strengthened our role in the market even further. During the presentation that follow, we'll show you a few specific examples of how they're implementing our strategy, where we stand and what we still plan to do. You've got an interesting morning ahead of you. At the end of the presentation, My colleague and I will be available for Q and A. I now would like to pass the floor to Thomas. Ladies and gentlemen, I'm very pleased to introduce to you our strategic program, Omnichannel. But let me start with 2 megatrends which are going to have a strong impact on the landscape of our business environment. The first megatrend is about the changes in the consumer healthcare market due to new purchasing behaviors. The way patients and consumers would like to get Their information, their services, and last but not least, their medication has already changed significantly, and we'll continue to do so. We all trust Doctor. Google knows everything. As we at Galenica put the customer first, we aim to adapt our way of doing business to match these evolving customer needs. Already today, patients and consumers are much more likely to start their purchase journey online than in the past. COVID-nineteen has just given an extra push to this switch. This trend will continue, And customer get more and better information online first. Once they are online, The direct conversion from just getting the information to the final purchase will therefore become more and more important. In this context, we also have to take the OTC liberalization into account, which we expect in Switzerland in the next 3 to 5 years. OTC liberalization means that in the future, OTC drugs can be delivered to customers at home via mail order without a prescription. But we assume still with the necessary quality measures and processes to ensure patients' safety. This liberalization will further shift part of the consumer healthcare business From pharmacies to the mail order channel. As a result, we expect Additional market growth through online stimulation. And we also expect a shift toward The mail order business from today's low single digit percentage up to 20%, 25%. Based on these assumptions, we assume about CHF 500,000,000 turnover at street price level will be redistributed among providers offering a consumer healthcare mail order service. However, it is equally important to understand that 75% to 80% of the consumer healthcare business remains in the pharmacy as we know it today. The second megatrend is about how patients receive their prescriptions. Paper prescriptions will be progressively replaced by e prescriptions. We believe within 5 to 10 years from now, 60% to 70% of all prescriptions, That's about 40,000,000 prescriptions a year, will be generated digitally and follow an online journey. Today, patients still receive a paper copy of their prescription and then go to their chosen pharmacy to get their medication. Tomorrow, it's likely that this choice of pharmacy will be made directly at the doctor's office. Of course, patients will still have the choice to which pharmacy their prescription will be sent, or they can send it themselves once they have received their prescription on their personal online system. But doctors and health insurances might recommend to a patient that their prescription is sent digitally to a certain pharmacy. As a result, CHF2.1 billion to CHF2.5 billion of the Rx pharmacy market will probably be redistributed among the pharmacies and potential mail order channels. Let me now explain what we understand by omnichannel and how this comes together with the 2 megatrends just described. To cut a long story short, we seek to touch base with patients and consumers wherever they are and whenever they are looking for a product or a service related to their health and well-being, as illustrated on this slide. This is our definition of omni channel, our approach through which we will fulfill our promise to the customer, as it is stated in our Galenica story. We support people at every stage of life On their journey towards health and well-being, with personal and expert advice and a unique range of products and services anytime, anywhere in Switzerland. To be omnichannel, there are 2 parts we cannot complete to fulfill today yet. On this, one is the possibility of getting in touch with patients and customers anywhere at any time they wish. The second gap is that we are not able yet to offer a combination of all our relevant services and products for a specific patient need through their channel of choice. Imagine, a chronic patient who is regularly receiving his medication from Medi Service at home. Now this patient spends his vacation in Zermatt, eating more than usual and running out of his medication. He would like to get his refill directly in Zermatt at the Amavita Pharmacy. While he is there, he has a chat with the pharmacist, and together they decide to do another blood sugar test and check the blood pressure. At that moment, the patient wants to go online to access his prescription and to write down the new test results in his application. Given the new results and the heavier food intake, the pharmacist recommends in addition an appropriate probiotic to support proper digestion. The customer happily leaves the pharmacy and continues to enjoy his stay at Zermatt. Having happy customers this way is what we consider omni channel. And in order to get there, the strategic program will address The following areas. 1, despite all the discussions about the importance of digitalization, Mark mentioned it before, we have to keep in mind the pharmacy will remain the center of our day to day interactions with our customers, as I just outlined before with the 2 megatrends. Therefore, we will continue to enlarge our pharmacy network and develop the pharmacy of tomorrow. 2nd, we will strengthen our collaboration with doctors and health insurances to direct patients towards our pharmacies. 3, we complete our network For providing a comprehensive range of services, not only in our pharmacies, but also at home and care homes. 4, we will inspire customers online. Through this, we generate growth per se and create more loyal customers. 5, alongside our in pharmacy services, we will provide the customer with a convenient mail order option to get Their products when needed, delivered to any place they may wish. Number 6, Last but not least, we will create a dashboard, a customer dashboard, about which I will talk about in a minute. Let me summarize at this stage. Developing our omni channel capability is key because customers are looking to get their information, Products and services anytime, anywhere, ideally through one access point of their choice for all their health care needs. The 2 megatrends from pharmacies to mail order and deep prescription will significantly reshape our business environment. Both these megatrends and the customer needs provide Galenica with a unique opportunity to further grow our business, Gain market share, while combining our well established chain of pharmacies and the continuous development of our digital capabilities. In the next part, I will talk more concretely about what we are doing to move forward with our omnichannel offer around pharmacies. As I outlined before, the pharmacy per se will remain the key point of contact with our customers. And as such, the pharmacy will be the key player in the omnichannel world. We therefore will continue to optimize our chain of pharmacies In order to be accessible and available to all our customers when they want or need to meet us physically. In other words, we continue to acquire, to close or to merge pharmacies for a strong network. We are also working on the pharmacy of tomorrow. We have just started with a complete new store layout for our pharmacy from SunStore from the format SunStore, as you can see on this slide. The first shop we'll open this November in Tricier. The new layout is just a first step towards the pharmacy of tomorrow. Tomorrow, a pharmacy will offer even more services than today. We will accompany patients through their therapy and will assist customers to access all products and services Galenica has to offer. The pharmacy will also merge the offline and the online part of the business, for example, by offering patients products that are only available online. With our primary care services, we have already started this part of the journey. In addition to the development of our pharmacies and in order to offer a seamless customer journey, we have started to align our digital services systems. This will allow our customers to manage their health and well-being through one access point. For this, we are developing a new customer dashboard as part of the digital system. With this dashboard, you will have access to all information about your loyalty status. Furthermore, you will also see your next doctor's appointment or your next appointment at your pharmacy to get a flu vaccination, for example. You will be able to access your medication plan to manage your medication refills from home. You will also have a state of the art web shop where you can buy all our products. On this dashboard, you will also get access to all potential services we can offer throughout the entire Galenic Award. Just to mention a few of the planned functionalities that will be that we will be implementing in this dashboard. Obviously, we aim to improve customer convenience, not only in our pharmacies, but also on the digital journey through our universe. By doing so, we will further improve customer loyalty to our brands and make sure We not only defend our current market share, but we will expand it. Through new and attractive loyalty programs and modern techniques for personalizing offers through marketing automation. We will also enhance the market growth as such, obviously. The omnichannel program is not something we can have in place overnight. We will implement it step by step. And most likely, it will never reach a final stage of development as the customer needs will evolve continuously. Having said that, it is clear to us, we have to create customer value consistently in an agile way, and by doing so, ensure a constant revenue stream. As a great example, I can show you Some figures we have realized this year till the end of September when it comes to dealing with COVID-nineteen activities. We developed the option for customers to schedule online appointments for the COVID-nineteen tests and vaccinations. More than 120,000 appointments were made, and our pharmacies carried out over 167,000 COVID-nineteen PCR and anti gene tests, and more than 60,000 COVID-nineteen vaccinations. When the corona self test became available mid April this year, We were able to implement an online subscription service within 2 weeks only. And in no time, we had 44,000 clients who brought the Corona who bought the Corona Self Test subscription. Coming to the end of my presentation. It is with great pleasure and enthusiasm that I work on the strategic program Omnichannel, which is supported by a great team across the entire Galenica Group. There are many fascinating and promising opportunities we will tackle, and we are looking forward to this next leg of our journey. Thank you very much, and I will now hand over to my colleague, Lucas. Thank you, Thomas. Ladies and gentlemen, I invite you to join us on a brief journey into the future. Today, We would like to tell you more about what we mean by digital health, where we stand today and how we are further developing our activities into the future. On the market side, you have already heard a lot about this in the omnichannel presentation. Now I would like to give you more insights into our way of addressing this topic on a technological level. In my short presentation today, I will focus on 4 topics. First of all, We would like to expand the services of the Galenica Group with complementary digital offerings. Along customer journeys, we develop offers Focusing on our customers and their needs. Digital services complement traditional therapy path. In the field of medication, we are increasing convenience and safety for doctors, patients and customers alike. We are simplifying the way prescriptions are issued, and we enable patients to obtain their medication with the help of online channels. As we believe in open standards, we are working together with emerging online health platforms. By doing so, we add value for our existing customers, and we are also gaining access to new target groups. And last but not least, by systematically increasing our predictive analysis and machine learning skills in our organization, we can enhance the customer journey of the individual customer. In his presentation on omnichannel, Thomas has demonstrated how customers should expect to be served across all of our channels in the future. But already today, our customers can benefit from a wide range of digital services. Just one example, during the pandemic, Our teams reacted immediately to changing customer needs. Various online services were launched using a unified technical platform on which the pharmacy formats Amavita, SunStore and Coopitality are based. This allowed maximum synergies to be exploited. We can see that the customers are using the appointment booking function on our website for COVID-nineteen tests And vaccinations quite intensively. And that's just one example. The technical solutions could only be implemented thanks to agile interdisciplinary project teams. Let's now look ahead. We are working intensively on the launch of the customer dashboard. This customer dashboard will enrich the customer's experience at the pharmacy with an online experience and provide digital access to all Galenica services. Customers will be able to manage interactions with The pharmacy online via the dashboard, redeem their e prescription in the mail order pharmacy or order items from the e shop. I would like now to go into a little more technical detail and use e medication as an example to show you how we are contributing to the digitalization of healthcare. Our subsidiary, IHCI Solutions, is the market leader in the field of medical data. In our editorial team, around 50 highly qualified doctors, Pharmacists and pharmacy assistants process master data for medication. HCI works with over 170 software partners who make our medical master data systems available in their systems. This master data is used by a wide range of health professionals, including doctors, pharmacists, logistics service providers or health and accident insurers. We leverage our access to these systems by offering further medication more use. Our certified clinical decision support system, The abbreviation is CDS play an important role in avoiding risks in the medication therapies. CDS CE is also the 1st software as a medical device certified in Switzerland. It can already be used by around 50% of doctors with their own practice and in virtually all pharmacies. Today, more than 6,000,000 CDS checks are carried out each month via the Documetis platform. The CDS checks automatically checks every prescription of medication and alerts the physician in case there are any risks. You may be aware drug interactions can occur when 2 or more medications are combined. The risks of undesirable interactions increase exponentially with the number of medications prescribed. Approximately 10% of our population now take 5 or more different medications. It's therefore not always easy for patients to keep the overview and follow their therapy correctly. The medication plan helps The patient and their families to adhere to his treatment plan. The medication plan also simplifies the interdisciplinary care by providing a quick overview over the prescribed therapies for each physician or pharmacist involved. E Mediplan and e prescriptions are based on the same open standards. The e prescription has been allowed in Switzerland since 2020, but it is hardly used. Our technology will contribute to the wider rollout of e prescription even more because it enhances convenience and safety for patients. As explained above, the Galenica Group supports patients and health care professionals throughout the medication journey. Our Docomedis CDS product suite supports the whole medication journey. Medication treatment plans can easily be exchanged between doctors and pharmacies. The AAD plan and the The e prescription guarantee the interoperability between different IT systems. This convenience for doctors and pharmacists is an important benefit. Many medical master data and Docomedis are integrated into primary care systems. This means that the service provider does not have to call up additional systems. They can manage their entire process with the software they're used to do and import the current prescription easily into their system, updates the therapy plan and order the medication from 1 of our logistics centers. Thanks to already existing interfaces, the integration effort for software providers is very low. So the consistent application of modern e health standards such as fire, new functionalities such as the e prescriptions, can be quickly integrated. Thanks to the fact that our solutions are widely spread and deeply integrated into service providers' processes, Galenica is able to strongly benefit From the upcoming digitalization, we are convinced that our existing customers will be loyal to their pharmacist and that we will gain additional new customers. What we already have achieved is a comprehensive technological development based on the patient journey, which I illustrated to you a few moments ago. We are currently working on the rollout of the e prescription to service providers' primary systems. The pandemic accelerated this rollout because we quickly integrated functionalities for handling COVID-nineteen tests and vaccinations. Documadis has become an indispensable tool for many service provider, for example, for the efficient completion of reporting obligations to Cantonal or federal authorities. We are also already putting e prescription into practice with Mediviran Svansek, an online doctor, with pilot trials being conducted right now. In the coming year, we want to onboard more doctors and also start approaching patients to explain the advantages of e prescription to them. The practical experience with our solutions are very positive. As you can see here, one of the major cantonal hospitals in Switzerland, in Lutzen, relies on our solutions and carry out several 1,000 CCS checks every month. In order to realize the Galenica Group's leadership ambition in digital health services, we are emphasizing the further development of our technological platform. The product and services platform facilitates the access to the services of and products of the Galenica Group for all stakeholders in the healthcare sector. Via the B2C ecosystem, consumers and patients can access our services and products. For example, with the customer dashboard I mentioned a few minutes ago. Healthcare platforms such as Compasana, Well and Benecora offer low threshold access to medical services. These service providers will use our apps to offer their customers a wide range of services and access the pharmacies of Amavita, Sunstore and Kopitality. Our cooperation with B2B partners is equally important. This means that healthcare professionals can take advantage of our unique market offering from the logistics service of Galaxys, Unione and PharmaPool. 2 things are important particularly important to us. Digitalization should complement and support the traditional range of pharmacies and pharmalogistix services. Digitalization in health care can only be successful if national and, above all, open standards are put into practice and used. We therefore ensure that all solutions comply with the standards and requirements of the federal government and the contents. In order to ensure broad market coverage, We cooperate with leading technology providers and maintain close contact with service provider associations such as Pharma Swiss and FMH. Finally, I would like to Add some insights about our internal IT setup at Galenica. As of this year, Galenica's in house IT teams are managed centrally across the group. We have pulled the capabilities. This is the organizational foundation for our contribution to digital health. The size of our IT organization facilitates The targeted expansion of our technological expertise. At our new competence center for data and analytics, the team is working on products which leverage on customer data and increase process efficiency. These data will be built on artificial intelligence, machine learning, predictive analytics and blockchain technologies. I would like to conclude my remarks and briefly summarize. With the newly created IT and digital services unit, Galenica is an efficient and effective IT organization. We use our existing network with full market coverage for medical data to increase patient safety and to launch the e prescription functionality on the market. We are bringing together our existing interfaces on the Galenica product and service platform to provide customers, service providers and eHealth platforms with easy access to the Galenica Group offerings. Thanks a lot for your attention. Thank you, Thomas and Lucas, for your interesting presentations. Now the floor is yours. Please let us have your questions. Please wait for the microphone before you pose your question. And via webcast, you have the opportunity to chat to your question. Yes, Mr. Vero was the first one who signed. Thank you, everybody. Good morning. Two questions. The first one is in relation to the refurbishment of your Son stores, very impressive pictures there. And is this already included in the CapEx of Galenica? Or do you need some additional CapEx for the refurbishments? And Do you have big plans to refurbish how many stores in the coming 2 to 3 years? Then the second question is just on one of your last slides. You also mentioned that you are thinking about using blockchain technologies. Maybe you can elaborate a little bit more about How blockchain could help you in all your digital applications? Thank you. Thank you for these questions. The second question, Lucas will answer afterwards. I propose that I take the first one regarding the CapEx. So it's clear we will refurbished Sun Store shops, shop by shop every year perhaps, I don't know, 5. Thank you, Wershimi, for this support. So let's say 5 pharmacies, and that's a normal rhythm of refurbishment. So no specific additional CapEx on top of the normal CapEx. Lukas? Yes. Thanks a lot for the question. And the e prescription is like a digital coin. It's a unique piece of paper, which has been validated through physicians and can only be applied in certain circumstances in the pharmacies. So The blockchain technology is predesigned to support these kind of processes, and we are in close contact with Official authorities also during the COVID-nineteen pandemic where blockchain technologies were put into place. So we see there a big future, not only on the market level, but also in an internal group level. This is Carla Banske from Foamtobel. One quick Question on the e prescription. You mentioned it's allowed in Switzerland since 2020. What are the hurdles still that it is more widely used? And how is the landscape looking like? So is it just a solution for Galenica that you only offer? For that question, I think as Lucas mentioned, it is legally allowed since 2020. I think the biggest hurdle today is the practicability. It's not convenient, not for the doctors yet, not for the patients nor for the pharmacists. So what we will, Our vision is to exactly create that customer experience in the sense of doctor The consumer is a customer, the pharmacist is a customer. And we are convinced once that convenience and that experience is created, e prescription will be used, that's what I said, 60% to 70% in the next 5 to 10 years. That's not a precise target, I know, but we really see that that's coming once the convenience is there. One additional remark, no, we don't see it as an internal solution exclusively on a Galenica level. As I showed you, I was talking about the whole market perspective and not only from an internal perspective. So it's important to address the whole market to cover the market with open systems, and we are convinced that we have a lot of Potentials already in place to support the digitalization in this way. Thank you. Next question, Mr. Gretel? Thank you, Mr. Burkhard. I have 3 questions actually. The first is just wanted to check-in whether there is any intention strategically to go abroad. I think I know the And so, but I just wanted to check from time to time. The second question is with respect to primary care physicians. Could you maybe discuss strategically how you see that touchpoint and that interaction going forward? On the one hand, there are particularly in the self dispensing, doctors, competition. But then also going forward, particularly with the e Prescription, they are very important referral persons. So could you maybe kind of just share your thoughts on How you see strategically kind of your collaboration with primary care physicians and networks? And the third question with respect to telehealth, What kind of intention your group has now to expand services? I guess, particularly talking about digitalization, this is also obviously an evolving kind of opportunity. Thank you. Thank you for these questions. I propose the second question regarding the decisions. I propose to Postpone to the 2nd part because Andy Koch will have a presentation around this topic. So perhaps a part of the question will be answered with the presentation of Andy Koch, if it's okay for you. Then for the first question that it's really clear, I will pass the question to Mark. The first question regarding our potential ambitions to go abroad Switzerland. I'll give the answer because he told us he knows the answer. No, the answer It's as always, yes. We are a company Switzerland. That's our main that's our market. That's where we have our businesses. And if there is any opportunities abroad, we will check it, you're going to look it, but there's no strategic dimensions to go abroad strategically. If there is any opportunities with certain kind of business, we never say no, but it's an opportunity strategy. Thank you, Mark, for confirming what I said since the year. I didn't want to say it again, so it was confirmed by the CEO now. The third question, perhaps short, Daniele Madonna, that's part of, let's say, CARE strategy. In the introduction, we have corporations are very important for us, and we have now, for example, one use case with Medi24. And here in this case, we are working together with this kind of consultations, the telepharmacy, It will also be a part of his presentation, but it's clear it's an important service we want to offer through our dashboards or other platforms for our customers. Thank you. Mr. Koch? Thank you. Jan Koch from Deutsche Bank. Over the last 10 years, you acquired about 10 pharmacies per year on average. And you also mentioned that you want to continue to expand your pharmacy network. But in view of your focus on digital health and the high likelihood of an OTC approval. Are you planning to slow down your acquisitions going forward and maybe Swift a bit more towards restructuring and modernization. And secondly, You already spoke about the investment plans for the new store concept. But what about your overall technology platform? How much do you plan to invest there also in terms of OpEx and yes, to increase your overall digital capabilities and offerings. Thank you, Mr. Koch. The first question I hand over to Thomas, omni channel. Thank you for that question. And as I said in my presentation, we truly believe and are convinced that the pharmacies will be the center of our contact to the customer, and we will adopt that network accordingly. So yes, we acquire pharmacies where a team fit, We close pharmacy where our teams fit or we merge pharmacies. We just make sure that we have the proper strong pharmacy network in place combined with the digital part. So there is no change in that strategy. The second question, it's a financial question. I take over. It's clear that the development of the digital infrastructure and the digital products from us and Luke has presented is not for free. It's clear. We will continue to invest CapEx, OpEx in these new technologies, but it's important to know we already invest today in these developments and it's clear we will continue, we will intensify these investments, these OpEx. But as Thomas explained, we will also introduce step by step every year the results, the new product. And so this should also finance these investments in the future. So it's not a new investment, it's ongoing and intensifying our activities in this regard. Thank you. Daniel? Daniel Leonov Jong from Mirabeau. Just one on the €500,000,000 potential You mentioned from the shift 3% to 4% to 20%. I think that's the market potential, of course, for The whole Switzerland. Will that be still then to be collected in the pharmacy? Or do you expect a shift legally that it's sent home in the end because at the moment, it's not allowed. It's 2 parts. I go directly to the answer, if that's fine. Thanks for that. Out of those $500,000,000 I referred to, I would say 60% already today can could be shipped home because it's cosmetics, it's personal care products, which are not on the legal restrictions that would prevent us from sending it home. But the desire of the customer is not there yet. And the other part is what you refer to the OTC business where we need the legal part to be resolved that we are allowed to send it home without the prescription. So that's the combination how it makes up those €500,000,000 and I believe that's going to be sent home. That's not going to be picked up in the pharmacy. That's really the convenience where the customer wants to get it, as I said, anywhere, anytime of his wish. Change legally is when? That's what I also said in my presentation. That's something we expect to come in the next 3 to 5 years. And then the other bigger part, I mean, you talk about the pharmacy offline business, The €500,000,000 in the future, but what about the rest? So the mass retailers, for instance, Do you expect them to be online as well? Or is that too sophisticated for them so that you can grab more share of wallet in this Slice. It's something which we didn't elaborate in that case at this moment. We were just looking at this stage what's happening to the piece in the pharmacy. And the other part, of course, there might be shifts in the mass market, but that's something we haven't looked into at this specific stage. And for the mass market, there is no legal restriction already today, full competitive, no restriction. Thank you for this question. Sure. We expect that the Otis market liberation will be the next 3 to 5 years, but we don't expect That this will be a liberation like it is just to buy, I don't know, a bottle of water. That means OT Liberation will be a kind of a patient security check between a physician or a pharmacist and a patient. And I guess that's important. We don't expect that it will be a normal online business as All other online businesses as well. It will be different. That's our expectation today. Thank you. Now we have some questions from the webcast. Julian? Thank you, Felix. We have 3 questions from the webcast. First question is regarding the service offerings in pharmacies. In the future concept of the pharmacy setup, do you expect to Diagnostic testing services and as the instrument of offering is increasing. This first question I propose to give to Daniela or Vershini. Daniela. If I look in the camera, yes, of course, we have some tests Also today that we can offer and we will continue offering them and improving this test. I think in the prevention, we have a lot of possibilities to develop, yes. Thank you, Daniel. 2nd question? 2nd question is regarding online sales. What is the time of delivery when ordering online? Today, what we commit to the patient or customer is a 24 hour delay. So you order today, and then you get your drug tomorrow. That's what we can offer today. And the third question is regarding digital health. You have been talking about putting customer first and bringing all players in the medical field together. So what do you make of some individual Private initiatives of developing an integrated health care ecosystem, bringing all actors together like health insurers, doctors, clinics. Would you be interested to participate in such a vision? I'd say we participate already as of today because as Our medication master data is already in those initiatives included, And also, our tools are used within these initiatives. This is not seeable in all times. It's not necessary that you See one of our brands, but we are already there, and we will continue to support those initiatives because, yes, it's the future. Thank you. Thank you for these questions. You will have 2 other blocks of Q and A in the morning. So if you haven't the possibility to pose your question now, you will have other opportunities. Now we take a 15 minute break and start on time at 11:20 with Daniela's presentation. Thank you. Ladies and gentlemen, In my function as Chief Healthcare Officer, I'm pleased to give you an update on our activities in the Care strategic program. We want to better support and assist our customers for their entire lifetime. This is our ambition. In order to come closer to our goal, we are in the process of expanding our range of health care services and therefore broadening our previous focus on dispensing medicines. With care, we want to open up new business areas in the future and take advantage of growth opportunities. In addition, we want to improve the quality of our customers' lives with needs based health and therapy services and support them in our pharmacies, digitally and at home as first point of contact for healthcare advice. In the pharmacy of the future, the importance of services will continue to grow. For several years, we have therefore been pursuing the path of moving from being pure product sellers to becoming product and service providers. The question is, which customer groups do we want to reach with our services? All people in all phases of life and health. On the one hand, people who want to stay healthy. And on the other hand, we want to be there for all patients regardless of their age, so that they can recover as far as possible or we can support them as best as we can in their life with an illness. The central point here is that customers' needs are different. In the Galenica Group, thanks to various companies and their broad range of products and services, we have the best foundation for meeting these various needs. We have defined 2 approaches to offer care solutions for different customer needs. On the one side, we can reach some of our patients directly. They come to the pharmacies or we care for them directly at home. This is the B2C approach, the direct contact between patients and our pharmacy formats or with the offerings of Pixel Home Care and Medi Service. On the other side, there are patients with whom we have no direct point of contact. Patients who we only reach the approach, supported by our business units, Medifilm, Pixel and the recently acquired LifeStage solutions. I would like to start with the B2C approach and use examples to show where we are and what potential we want to tap. Let's start with the pharmacies and the example of primary care services. What does primary care offer? An example, normally your eye is like this, beautiful, without redness, without pain. Now it can happen that this is not the case. Maybe you already had an inflammation once, a so called conjunctivitis can be caused by a virus. In most cases, you have reddened eyes or the feeling of sand in your eyes. It can also be caused by bacteria. Typical in this case, is that the eyelids stick together in the morning. Patients often go immediately to their family doctor, to their ophthalmologist or to the emergency unit of a hospital. However, in many cases, an eye inflammation can be treated quickly and effectively in a pharmacy. With the help of an algorithm, a medical history is taken and the pharmacy the pharmacies can dispense an effective medication, usually from the List B, without a prescription. The price, whether you take the solution at the pharmacy or go to the doctor, can differ by a factor of 10 in this example. For the customer, the solution with primary care means, in addition to lower costs. Above all, more convenience, they can come to the pharmacy at any time without making an appointment and receive the therapy immediately. For the pharmacy, primary care provides more frequency, more satisfied customers who will think of the pharmacy again next time they need it, and that means more sales. Primary Care makes an important contribution to highlighting the heels of our staff and positioning the pharmacy as the first point of contact. Currently, we can treat 28 indications with primary care from eye infections to acne, urinary tract infections or ED erectile dysfunction. Despite considerable cost advantages, Primary care at the pharmacy is unfortunately still an out of the pocket service. This means that customers have to pay for it themselves, whereas if they visit a doctor, the costs are covered by health insurance. This difference in cost coverage is incomprehensible for us, for us and for our clients. We are also committed to eliminating this inequality. The development of primary care is promising. With a dedicated team, we are working to continue to increase the turnover of the service. Therefore, in addition to the continuous education and training of our staff, we will also strengthen customer communication. We estimate primary care potential to be high, and we want to exploit this. We are also focusing on digital health services. Several initiatives and pilots are currently underway. With Online Doctor, for example, we are offering a new digital service at the Amavita pharmacies, so that customers with skin problems can quickly obtain a medical diagnosis from a dermatologist and get the appropriate therapy without having to wait a long time for an appointment with a specialist. This is a concrete approach of integrated care in which pharmacists and doctors work together. Online doctor, as an example in the digital field and AppoDoc as an example on-site. I am convinced that a multidisciplinary approach between different service providers is becoming increasingly important for successful therapies. In order to quickly gain know how and valuable experience in this area, we acquired Apodoc in Zurich, a pharmacy with an integrated medical practice. The interdisciplinarity between doctor and pharmacist has been lived here for years. With AppoDoc, we now have a kind of laboratory where we can test new services and new forms of cooperation that may later be relevant for our network and our development. For example, we are planning to gather initial experience here with the prescription dialogue. As mentioned before, in the context of primary care, today, Practically, all services are out of pocket and are not covered by health insurances. To promote that change and improvement in terms of cost coverage, it is in our interest not only to offer test to offer or test these services, but also to document and evaluate them. With concrete data and evaluated experiences. We have arguments to join the discussion on this topic. Health insurance companies can also only benefit if patients can take advantage of more cost effective options for treatment at the pharmacy. However, discussion with sales insurers alone will not provide the solution. Political framework conditions must also be adapted. Currently law prohibits health insurers from covering pharmacies' services other than dispensing of medicines. With the help of Mrs. Rote Pascia's motion, a first step has been taken here to change this law. As explained at the beginning, We not only have customers in the pharmacies, but also those who are at home and need special therapy. They, for example, obtain services from our Medi Service Business Unit. Medi Service grows continuously with the home care services. The need of certain client groups to be cared for at home is increasing. For example, Medi Service nurses visit their patients at home to administer infusions and provide other essential services. Another option here is video consultation, which is also seeing growth in demand. This personal support and care of patients offer security and convenience for the patient. In addition, the attending doctor received the assurance that their patient is getting the medication and using it correctly. It has been proven that when patients are supervised and therefore take the therapy correctly and regularly. We speak of compliance or adherence, they live longer. Over the past 25 years, Medi Service has developed from a pure mail order pharmacy into an important partner in the area of specialty Rx and chronic care. In other words, it addresses those customers who need special medicines and or care at home. We are talking about medicines that they cannot simply get at the pharmacy because the therapy requires special care. The Medi Service team is active in over 50 indications from immunology to neurology, rare diseases, etcetera. Medi Service is successful on the road, which is also confirmed by high customer satisfaction. Medi Service continues to expand its leading role in the specialty indications with a focus on neurology, rare diseases, hemophilia and multiple sclerosis. In the last two indications mentioned, Medi Service has High market shares, which it intends to further expand. We estimate a market share of 25% in multiple sclerosis and 36% in hemophilia. It is important to understand That Medi Service, we are dealing with high priced medicines that lead to volatile sales. What are the reasons for this? With specialty medicines, small patient populations have a high demand for new medicines for new therapies. Accordingly, specialty drugs are more expensive. Small volumes with high prices automatically lead to noticeable sales fluctuations. I would like to mention 2 concrete examples that illustrate how volatile sales can be. We experienced this with hepatitis C. To begin with, the treatment option was nothing to poor and no cure. So when the new therapy was introduced, sales went through the roof. But once this population was cured, medication sales quickly declined. In multiple sclerosis, another example, patients used to need an injection at home 3 times a week. Now, they get an infusion twice a year, which is also administered in a hospital. We are talking here about channel switch. This means that we have to continue to fill the pipeline with new drugs, with new therapies. Therefore, the team of Medi Service focuses on this aspect dealing with the pharma industry. VCSEL is also active in the home care sector and offers additional complementary services to the Medi Service range. VCSEL specializes in clinical nutrition and is now a leader in this field. VCSEL also wants to expand its special knowledge to other to new areas. For example, OPAT, it means pain therapy applied at home via infusions or in the area of tracheostoma. Tracheostomy is a surgically created opening in the neck, leading direct into the trachea to the breathing tube. And in the area of metabolic disorders. We talk about metabolic disorders when you have problem with breaking down food to its Simply components like proteins, sugars and fats. As with Medi Service, The focus at Pixar is on convenience. Patients can therefore lead a more or less normal life At home, which means improved quality of life. Following my presentation on some initiatives in the B2C approach, we are now switching to the B2B4C approach. B2B4C is particularly important for the target group seniors, which we no longer reach with a pure B2C approach, given the range of institutions such as homes, home care organizations and hospital that play a role in caring for the elderly. With this target group, why is this target group so interesting? Because as Mark already said mentioned, it is growing massively. Let's look at the age pyramid on the right. In 2021, we have 460,000 inhabitants over 80 years of age. In 2,040, there will be 2.5 as many, meaning over 1,000,000 inhabitants. Many of these 80 plus years old will be cared for in old people's and nursing homes or at home via home care organizations. Here's a look at the development in the area of Care Homes in recent years. You can see here that the number of places in retirement and nursing homes has increased slightly. We are talking about approximately 160,000 customers in 2019, distributed among around 1500 old people's homes. The number of homes on the other hand has declined slightly, as some have merged. This market consolidation is interesting for us as it facilitates the access to the nursing homes. However, the number of home care customers has increased significantly. Today, we can assume that about 400,000 customers are here. These customers no longer make purchases themselves, but via home care organizations or hold people in nursing homes. Therefore, we want to offer additional solutions for these B2B customers in the future. Our answer, we offer these B2B clients the possibility to use offers from different modules individually or in combination, but importantly, well coordinated. The wide range of services that we can offer here with our various company is unique in Switzerland. That's why I'm now getting to our latest acquisition, LifeSage Solutions. It provides a very important interface for us, the one between patients and institutions, such as home care organizations. With its platform, LifeSight Solutions allows us access via home care, homes, hospitals to the end customers. A target group that we explained earlier will grow in size and importance. Lifesize Solutions offers a holistic solution that significantly facilitates the task of these institutions. This is not only about selling products, but primarily about solutions that facilitate internal processes and therefore, create free space for the actual task of the institution caring. All the activities mentioned are examples of how we want to better our company and support our customers in the future in all phases of life and health. At Scalenica, we are convinced that we can offer the healthcare services and products required for this, both in the B2C and B2B4C market. In closing, ladies and gentlemen, we are all getting older. We are all going to need some level of help along the way. And I, as Chief Healthcare Officer, intend to see that Galenica leads the way in providing cutting edge services to our customers. Thank you very much for your attention. I now hand over to Stefan. Ladies and gentlemen, it's a great pleasure for me to speak to you today about Varefora's growth plans and recent M and A activities. I will start with a snapshot of the current market situation. Where Fora has achieved clear market leadership in recent years, especially in the last 2 years. But there is still considerable potential for growth as our current market share in Swiss consumer health is only 8.6%. The key drivers for getting to the number one position have been our recent acquisitions, which added a total of CHF64 1,000,000 calculated as street price. CHF 34,000,000 have been added by acquisition of brands and companies, and the further CHF 30,000,000 come from new distribution agreements. Let me give you a brief overview about Varefora's global portfolio structure now. Wherefora is a company built on classic OTC. This still accounts for more than 80% of sales, as you can see in the blue part of the circle. The forest market share in OTC a moderate 11.4%. So there is still important growth potential. Where Fora is market leader in the big categories of pain, relief and cough and cold. And through our most recent acquisitions, we have also been able to considerably strengthen our positions in vitamins, mineral supplements, skin treatment and complementary medicine. Airfora has a clear strategy for sustaining growth. We build our growth on the following pillars. We want to grow our big brands like Algae 4, TrioFawn and Perkskindol at above market average growth rates. We want to further build our emerging platforms of complementary medicine, beauty, and Rx. We will keep striving for new distribution agreements. And as a key growth driver, we will continue to acquire brands and companies with growth potential and strong brands. On an international level, We will continue pragmatic expansion via distributors as we already do today. As described in the introduction slide, the last 2 years have been dynamic in terms of M and A. And I would like to give you a quick overview about our achievements in 2020 2021. We have had acquisition in the OTC sector, which you can see in the red boxes. In the new platform, complementary medicine, which are represented by the green boxes and in beauty, in orange. In OTC, we have taken over the distribution of bupotantum and ThermoCare from Angelini Pharma in 2020. And we have acquired the Hedoga Group in summer 2020 as well as the pharma portfolio of Doctor. Wilt in May 'twenty one. In complementary medicine, we have been able to take over distribution of the Institute Alergusson's portfolio with its principal brand, Omni Biotic. And this September, we have acquired the Swiss company, Spakiroz, having had a minority share in this company for the previous 3 years. In beauty, our portfolio has been driven by starting up distribution of Urlage in summer 2020 and taking over the distribution of Mustela in January 'twenty one. Now I would like to share a recent example that illustrates very well how Galenica is able to leverage the internal synergies between Varphora and our pharmacies. And in doing so, we present an attractive platform for distribution agreements. In March 'twenty, Berthora took over the distribution of the Alagrozan portfolio that consists mainly of the well known probiotic range, Omnibiotic. In the 1.5 years since then, Our pharmacies have been able to boost their market share massively from 9% to 31%, multiplying sales, 6.5x. Let me give you an update about the 2 acquisitions in 2021. The first pharma business of Doctor. Wilt and then Spahiroz Ake. Doctor. Will's pharma portfolio was acquired in May 'twenty one. The portfolio contains well known OTC brands, including V Day 3, vitamin D3 built, Oxyplostine and contrast merits. The acquisition's key asset is leadership of the vitamin D market with a strong line of reimbursed products. The integration of the Doctor. Will products into the VEFORDA portfolio has started and we'll follow a step by step process in order to respect the strong heritage of the Doctor. Wilt brands. With the acquisition, we have been starting a new dedicated doctor sales force to support the reimbursed lines. And now, the latest acquisition, Spakiroz Ake. This is very recent, September 21, and it represents a big step forward in the growth area of complementary medicine. Spagoras offers a broad complementary medicine platform with 4 pillars: phytodrugs, chemotherapy, spagyrics and homeopathy. The portfolio consists of well known brands, Spogiro and Gemmo. Spogiro has an excellent image and recognize competence in its fields as well as strong relationship with natural therapists. Spakuros operates 2 Swiss production sites, manufacturing biodynamic handcrafted products. It also cultivates HERDS for its own use in the Swiss Chira. Now what are our plans and ambitions in the field of complementary medicine? Globally, We want to further grow our complementary medicine pillar to become one of the major Swiss players in this field. The acquisition of Spokuros is a major milestone in achieving this. We aim to exploit the potential of Spagiro's pearls, Spagiro natural sore throat lozenges and the chemotherapy products. We also want to sustain the dynamism of Olegosan's omnibiotic range. And on top of that, we aim to build around Stagros, creating a platform and the center of competence in complementary medicine. In summary, Merfora shows dynamic growth within the Galenica Group, a performance driven by our distinct growth pillars and led by M and A activities as well as synergies with our pharmacies. Thank you for your attention. Now I'll hand over to Andreas Koch, who will tell you about logistic and wholesale activities. Thank you. Ladies and gentlemen, thanks a lot for the opportunity to share with you some insights about the development of doctors and medical practices in Switzerland. Also, I'm happy to give you an update about the infrastructure projects we are working on in the wholesale and logistics service unit. Doctors are a very important customer segment for us in wholesale and logistics, because on one hand, a reasonable number of them are self dispensing, which means that they can give the medicine directly to the patient and hence bypass the pharmacy. On the other hand, they are responsible for prescribing, which is also important for us because patients with the prescriptions will later on go to one of the pharmacies. In Switzerland, there are fewer and fewer traditional family doctors. The general practitioner in the village, with the first point of contact for all medical concerns almost around the clock is becoming increasingly rare. The reason is that many of these doctors are reaching retirement age or have already passed it. This has a significant impact on basic medical care, especially in rural areas. We have made an analysis in the Eastern Switzerland region where doctors are traditionally self dispensing. Large parts of that area are already suffering from insufficient medical care. And on the slide there, you can see these areas in the purple color. And the question now is, what can we now do and where do we see our role. To achieve better basic healthcare, we contribute to the doctors' market in 3 different ways. Firstly, we act as a wholesaler, not only for the pharmacies, but also for the self dispensing doctors, both in general medicine, but also for the specialists. And we are already very well positioned in this area. We see a growing number of specialists in our customer base. Our customers benefit from a high level of product availability, fast deliveries and a large product range. Secondly, since private practices are becoming increasingly rare, We believe that medical centers will play an important role within the healthcare system going forward. And therefore, they also represent a growth market for Galenica. And our role here is beyond wholesale. We are also a close partner for these medical centers. And thirdly, for both segments, we do not just deliver drugs, but also medical devices and laboratory equipment. In future, medical centers will offer doctors different perspectives. This means that general practitioners will more than today work part time without having to bear the entire entrepreneurial risk of their own practice all alone. Also, the business model of a self dispensing practice depends on the margins achieved through products. This is another burden to carry and a risk that medical centers can strongly mitigate. Overall, Medical centers make basic health care more attractive for medical students, and this is urgently needed. After all, currently around 25% of medical students in Switzerland opt for general medicine. This means that only about half of Switzerland's basic healthcare needs will be covered by the middle of this decade. If this figure were 50% of all prospective doctors, primary care would be secured again by 2,040. So, we see a need for action here and we support medical centers by being a reliable partner along their entire value chain. Medical centers have access to all of our services. We can provide advice on setting up a medical practice with co financing as an option. We provide an attractive and full range of products, which is relatively easy for us to integrate into our and which helps us to make use of the capacity of our distribution centers. We can provide advice in terms of practice and pharmacy management, sharing our experience in that field. Sometimes, for example, they use a robot in their doctor's office to store the products safely and efficiently. We work with them to ensure that related processes are working as they should. And finally, we provide logistical excellence, delivering the products to the medical centers even increases our efficiency as we usually cover them on one of our daily tours rather than the two tours we have usually for our pharmacies. Also, if we can cover the orders from 5 to 6 doctors in the same center, it makes us more efficient as well. Right now, we are in negotiations with several medical centers where we have good chances to enter to an agreement. One medical center where we already work with is Dockstation in Zurich. And I would like to give the floor now to the head of this center, who will report on his experiences of working with us in a short video message. And this is Doctor. Adrian Palmer. He speaks faster than me. He is from Zurich. Looking at our market shares, the success of our Medical Center strategy becomes even more quantifiable. We see now the following picture. The overall market has grown by 16.5% since 2017. The market share of Galenica has increased from 29.6% to 30.9% in a growing market. And at the same time, the share of other wholesalers has declined accordingly. In absolute numbers, our revenues have grown by 21.5% over the last years, which means we are growing faster than the market. With these promising opportunities, we are convinced that we can further grow in this attractive segment. In the next few minutes, I'd like to give you an overview on the latest news from the modernization projects in the Wholesale and Logistics Service Unit of Gallinica. To modernize our infrastructure, we are executing 2 key projects now. The one described on the left side is called Modulo internally. It's about the renewal of our ERP systems at Alloga and Galexis with an estimated CapEx of more than CHF70 1,000,000. We expect its full financial benefit from 2025 onwards. And at the same time, we run a project that we call AVANCE internally. And This has the objective of modernizing the Galaxys distribution center in Ecublanc, which is close to Lausanne. This has an estimated CapEx of more than CHF33 1,000,000 and the full financial benefit is expected from 2023 onwards. For these modernization projects, there are mainly 3 drivers. First of all, it's about increasing efficiency with the use of new technologies, new functionalities, and also a higher degree of automation. Also, both our old ERP systems and the facility in Equiblon have reached end of life in terms of technology. So it was the right moment to reinvest and be prepared for the future. Speaking of going forward, we invest in our infrastructure to get ready for future growth that includes also a capacity increase, but also it has a geographical dimension. We remain committed to our location in Western Switzerland, which will facilitate our future expansion in that region. Both projects are proceeding as we speak, and I'd like to give you an overview about what we have already achieved and what comes Next. As for Modulo, the ERP replacement, we began our rollout activities at Alloca and all go lives we have carried out so far went smoothly and without major issues. Today, about 1 third of Alogas business is already live on SAP, and we are constantly integrating new elements into the system. For next year, while we continue the Aloga rollout, we are building the system for Galaxys, entering into the test phase and begin the data migration. And to mitigate the risks, The 2 Galaxys distribution centers in Equiblanc and Nidebib will go live in different stages in 2023 2024, starting with the smaller one in Equiblon. To be able to migrate the distribution center in Equiblon. We are finalizing the modernization on this facility first, and we expect the building to be completed by the end of this year and to get all parts of the new facility operational next year. And in 2023, as mentioned, we expect to be live then on SAP. So thanks a lot for your attention. And now I would like to hand back to Felix for the next Q and A session. Thank you, Daniele, Stefan and Dandy for these interesting presentations. We start the 2nd Q and A session. Who has the first question? Microphone to Mr. Grete. Thank you. I have a question on Vaphora. It is Still the case that in most of your indication kind of and the product categories, Your market share is still below your retail pharmacy market share in Switzerland. And also if I look at cough and cold, 16.5%, for example. Why is that the case and why kind of you are not having at least kind of the market share of the overall kind of Galenica Group on a retail level. I think that should be relatively easy to achieve Penetration within your own network, isn't it? Basically, we have many areas, including brands in the CCR category shares in Dalenikethere are clearly over fair share. So what's The opportunity to increase your market share within your own retail outlets, now kind of in the Galenic and corporatearity outlets, therefore, our products. There is still much To further develop the market shares in Galenicare, it depends from area or category to category how much potential is where to be found. And the teams are working on daily business on that. And we also see headway every year basically. So There is potential. We're working on it, and we're making headway. Do we have other questions? Hello. It's Urs Krum from Research Partners. Regarding Primary Care, the question of when by when do you expect that The costs will not be out of pocket. What kind of time frame we could expect that? And then right now, you have 28 indications. The numbers are growing, the visits. Is there a limiting factor at some point where maybe you don't have enough Space anymore or you have to get more physicians or doctors into that, Say, into your business. And then this question about, are you in any case intending to have kind of Pharmacies, I know so this Upadog thing, is it something You're going to go further and then have then pharmacies where you have a doctor's office, you employ doctors. And how far would you go? Thank you for these questions. Daniela, you can start. Yes. I can answer. I start with the Question about out of pocket, the limitation of primary care and costs. As I said, there is actual emotion from Mrs. Pasquier. That means that something is going on to remove this point in the low. And we have here our umbrella. Organization, Pharmasys, is doing also a good lobbying on this topic. But precise date, I cannot give you the date when it's coming, but we expect this in the next years. Then the second question about the number of indications we have. Well, we have no limitations about space. Here, we are developing further with also with doctors. We're also looking at new algorithm. And as soon as we have one more algorithm, we can have it in the pharmacy because The pharmacist and the staff in the pharmacist are trained for dialysis indications. And the third question about Apodoc. Here, we acquired a pharmacy, primarily with a medical cabinet. And what we want to try here is this interdisciplinarity, how we can work better together, pharmacists and doctors. If I have a patient in the, I am a doctor, I have the patient and then I can talk to the pharmacist to find out the best therapy And this discussion is very important for the customer at the end. But we are not going to Yes. We are trying new services that we can then expand in our network. I'd like to add in this regard. So we have really no intention to build up, let's say, a doctor's chain as we have done for the pharmacies 20 years ago. No intention. We support and we collaborate as Andy Koch presented. We extend our medical services in our pharmacies, but no intention to build up a physician's chain. But thank you for this interesting question at Langez Ahmed. Hilmar Langez Ahmedz, Head Capital. I have a question regarding Spagios and the complementary market. How big is this market? What's the sales of Spagios? And what is the margin there, the EBIT margin? Is this higher as in the normal pharmaceutical business or lower, for example? Yes. We have disclosed when buying Spaguros sales of $10,000,000 street price. Margin wise, the business is as interesting as normal business. And the third point of your question was, sorry? The market size, yes. So complementary medicine is something not clearly defined by IQVIA. If you count into that the future drug market as well, what we do, you are in a high single digit percentage in consumer healthcare. Thank you. Next question, Duncan, Perot, Cantona Bank. Two questions from my side. First one is in relation to your Slide 75 in the presentation. Maybe we Quickly switch back to that one. I think it's really interesting the assortment of services that you provide to these medical centers just elaborated. My question is more about how often do you really offer all the offerings that you just illustrated from The financing to operational management and of course also products. And if you only provide some of these illustrated services, which are The most often used besides, of course, serving them with the products. Then the second question, just in relation to And Equiblon and also Niederbeep, I mean, you now invest heavily in these logistic expansions also, and you talk about a lot of automatization. Can we also expect then some margin improvements for your Logistics business from 2023 onwards? Thank you. Amdi, the first question? Yes. It's about the service offering we give to our customers, and it highly depends on their needs. So sometimes we use modules. So we have, for instance, customer, we start with equipment for medical cabinet, for instance, and we enter and we see there is a need for robots, there is we give consultancy, Then they ask, okay, which software should we connect this? We give consultancy for the interface, then we See the potential for delivering the medicine. Sometimes it's the other way around. We have, for instance, a customer from pharmapool, which is traditionally delivered by products. And now they ask for more. They said, okay, we thought about creating a strategy to go into the future. What do you think about medical centers? We said, yes, yes, exactly. And they said, but how should we do this? And then we come with a lot of advice. We come from the Galaxy This side then with all our knowledge, look, you can create a medical cabinet if you want, and others do it like this, and we support from that side. So it's different touch points. And from that point on, we try to elaborate or what we already have done, we look for a synergy with a medical cabinet and the pharmacy. This is a complex project, but also this is the case. And for the second question, Equibor and Niederbyb, obviously, yes, we have said that there will be 3 effects. The one you probably like the less is we have to reinvest because we have these structures that we have to replace. But then we have the technology part. We say clearly that there will be improvement than on the ROS for the next years, which is expected. There I can add perhaps one point. We released the midterm guidance. And there, we said that for logistics and IT, midterm, we're convinced that we can improve the EBIT margin up to 2%. And today, we are around 1.7%. And this EBIT margin increase should mainly come from these efficiency gains, thanks to these two projects, just to give you a magnitude. Other questions? First, Mr. Vero, yes? Just a follow-up on the first question. Can you also provide a bit also a Split of these different services that you just elaborated, which are the most used ones, I just think I'm just interested about that one. So I get a bit of better understanding about the split of these services. I think the most use is obviously still logistics. The logistics services, the opportunity to have a very high availability of products, And we gain a lot of in the segment of the specialists, the specialists that tended to order directly in the past from the industry, which shifted now more and more to wholesale because it's easier for them and the needed capital for also the expensive treatments will be lower because we live on daily basis, not like if you order today from Roche or from Pfizer and you're a physician, You have the possibility to order one time in a month because otherwise you are not getting delivered from them. We deliver each day so you can lower your stocks also. But then I think the second pillow is certainly to support with the medical equipment like fridges and things like this, which is not primarily For us, a big deal and a high margin, but it's again the entry point to deliver all the rest. And the 3rd pillar is now The support of their basic investment, for instance, with Adrian Palma, we help him to expand his medical centers in Switzerland, he will create new medical centers, and we help him. And later on, This is also a business for us. Thank you, Andy. Do we have questions from the webcast? Questions for Healthcare. First question is rather confirmation. The distinguishment between primary care service and ARPODOC, Can you confirm that primary care is provided by the pharmacists and AbuDoc by a physician? Exactly, yes. The primary care services We offer in our pharmacies are provided by the pharmacists. Thank you. And the second question is regarding midi service. When are the lines becoming blurry between midi service and traditional Speedetics? Aren't many of your patients also requiring other medical help due to comorbidities? Yes, it's clear that the patient we have at Medi Service, they are also chronic patients and they always need more than only the medicine. So we can provide the medicine, the therapies. And here we have tight Cooperation with the medical doctors and other home care organizations just to provide the best care for these patients. Thank you for your active participation in this second Q and A session. I would now like to conclude by summarizing the key points of this morning's presentations and how they should contribute to achieving the midterm guidance. Mark started by showing us that our environment is in a fundamental state of change. Digitalization, networking, changes in customer behavior represents great opportunities for Galenica if we manage to anticipate and adapt to these changes well and in good time. The cross pressure in the health system is a well known challenge. Demographic changes and new treatment methods presents further opportunities that we intend to exploit. We're convinced that we will achieve our midterm financial goals in this changing environment if we consistently implement our strategy. We want to grow faster than the market with an expected market growth of 1% to 2%. We want to further increase the EBIT margin in both segments, in products and care to over 8%, and in logistics and IT to up to 2%. Over the course of this morning, you have heard how we intend to implement our strategy and thus at least achieve our financial targets. With the omnichannel strategic program, we want to further expand and optimize our pharmacy network and make it more attractive for customers. At the same time, we are further expanding our pharmacies at home channels, such as the web shops, mail order pharmacies and home care offerings. The aim of Omnichannel is in particular to network the various channels in such a way that customers can access Galenica's comprehensive range of products and services at any time and from anywhere. Thomas Suran presented the plans of the strategic omnichannel program. With this program, we want to grow in the business to customer, the retail business clearly above the market. Of course, this growth will not come by itself. Lukas Akerman told us that we will continue to invest in the digital infrastructure and digital products in the next few years in order to successfully implement the omni channel vision. The further development of our own product range is also a part of the omni channel strategic program. Stefan Balti has shown us that we have still considerable growth potential with existing and new products, even though we are clear market leader in the consumer health care market. With the expansion of products and brands, we want to contribute in particular to the improvement of the EBIT margin in the Products and Care segment in addition to growth. Daniella Madonna used various examples to explain to us how we want to drive the transformation of our pharmacies from medicine distributors to healthcare service providers. However, the CARE strategic program is not only aimed directly to our customers and patients, but also at B2B service providers so that they can better serve their customers and patients. As with our own and partner products, We also want to grow with the services of the Care program and improve the EBIT margin in the Products and Care segment. With the professional strategic program, we want to expand and improve our B2B offer for service providers in the healthcare market. The B2B services in the Care program and the further development of the VEFORDA product portfolio are both also part of the professional strategic program. Since we want to offer and develop our products and services, both to the B2C and to the B2B market. Our strategic programs overlap here, which ultimately benefits our customers. Andreas Koch presented the successful and promising initiatives in the doctor's market as an important part of the professionals' strategic program. These initiatives should help us to grow above the market in the Logistics and IT segment as well. The digital health initiatives presented by Lucas Akermann are not only the basis for the implementation of our omni channel vision. They are also another important component of our professional strategic program. With the further development of our business with medication data, clinical decision support systems and the digital networking of service providers in the healthcare market. These digital services are also expected to contribute to growth, but especially to the EBIT margin improvement in the Logistics and IT segment. Andreas Koch gave us an update on the 2 important projects in the efficiency strategic program. The ERP project Modula and the Avance project, the modernization and refurbishment of the distribution center in Lausanne, Equiblon. The implementation of these two projects should allow us to improve the EBIT margin in the Logistics and IT segment to up to 2% in the midterm. Besides all these examples, many other measures and initiatives are underway in the various strategic programs. Today, we are focused on the most important ones. We are convinced that we have set the strategic course and are working on the right measures so that we will continue to develop successfully and at least achieve our midterm financial goals. Thank you for your attention. I'm happy to open now the last Q and A session. No matter what question you have, now is the last moment in this event. Question from webcast, I heard. Yes. Regarding the midterm guidance, Is it fair to assume that with midterm guidance that implies a 3 year time frame? Excuse me? Does the midterm guidance imply a 3 year time frame? So when will it be fulfilled? Yes, we said 3 to 5 years. That's the time horizon. It's clear we especially mentioned for the EBIT margin objective for Logistics and IT, that's after the implementation of the 2 strategic programs. So 3 to 5 here is our horizon for the midterm guidance. Thank you for this question. Thank you. I've got 2 questions left. Firstly, on Home Care. So over the last couple of years, you have strengthened your Home Care business through several acquisitions and new offerings. But are there any areas or offerings which you are still missing today, which could be of interest for you. And secondly, on one of your latest acquisitions. So looking at the pro form a numbers made for the acquisitions made in the first half of twenty twenty one. It looks like that the margins of the acquired Doctor. Wahl business Highly accretive even in your products and brand business. Do vitamin products usually carry higher margins or is Doctor. Walsen exceptions given the negotiated reimbursement rates? And are there any other vitamin products in the market which carry similar margin profiles? And if so, Could these also be of interest for you going forward? Thank you for this question. I propose the first question is for Daniela. Yes. For the first question, as I mentioned with home care is quite a large topic. But with Medi Service, for example, we have the focus with SpecialtyRx, with Chronic Care, with Bixler Home Care, the clinical nutrition. And as I mentioned, we have these 3 new areas, which we are exploring. And here we want to grow. And it's clear that we continue looking on the market what do we have for other chances, and this is a continuing process. Thanks, Daniele. The second question, the pro form a figures. You have to take into account that the acquisition of the build products, they were just integrated for some months in the first half. So, I would say these figures just after integration are perhaps not representative for the long term. But it's clear, it's clear our ambition and the potential to increased the EBIT margin in Products and Care is through new distribution contracts for new products, is through new acquisitions of new products. It's clear that in this business, Stephan presented to you, we have higher EBIT margins. So it's margin accretive, that's for sure. Do you have other questions? Yes, Mr. Gretel. Thank you. Actually, no, 2 more left. Maybe could you just provide also a quick On the current trading environment you see, especially now kind of the high frequency location and what kind of traffic Come back, you have seen, it looks reasonably normal these days out there again, besides the airports, of course. And then also in our kind of the testing, obviously, kind of it's a big topic these days. And then the second question is just relating to your balance sheet. You're running around 1.6 turns leverage right now, which is It's more towards the lower end of the historic levels. And I think the guidance is plusminus2 turns. So what's your kind of thought process behind that? What are the priorities in terms of this excess Capital allocation opportunities are more back to shareholders or more kind of accelerating M and A strategy, for example? Thanks. Thank you for these several questions. Let's start with the first one, current trading update. What can I say in this regard? I would say we are on track to achieve our guidance for this year. So, we continue to develop. We are happy with the development. And perhaps specifically regarding your question in our high frequency locations. There, remember, in the first half, we were still around 30% below pre corona level. But it improved in January. It was around minus 35% and in June already minus 25%. And our assumption for the full year guidance was that we step by step, but very slowly normalize or improve the footfall in these high frequency locations. And that's what is confirmed now with the current development. Then the question regarding the balance sheet. You mentioned the leverage of 1.6x EBITDA in the first half, which is quite low. You have to take into account that this low figure is also influenced by a very good EBITDA in the first half, integrating also one off elements in the EBIT, thanks to the COVID initiatives. So, there, in a normalized with normalized figures, it's slightly higher, the leverage in the first half, just take that into account. But coming back to our policy in this regard. It's clear we still have the objective mid term that we want to leverage plusminus2x EBITDA adjusted for leasing accounting standard. And if we have 1.6x, 1.7x EBITDA, we are still in this range. And it's clear, our first priority is that we use our strong cash flow to invest in the business, to invest in good, interesting M and A opportunities. But only if they are really good, if they're really promising. Otherwise, we will prefer in the future to return the cash to shareholders. But we are convinced that we will find interesting opportunities to further develop our business. Do we have Yes, Daniel? Also in the direction of Chris, What's your base scenario for flu and so on for this? I mean, we hear a lot, and I think consensus is that flu will come back, Not like last year because people have not too much immunization. So your flow business could potentially have quite a decent development? And then your involvement in boosters, I guess it's still the same like in spring that you are still possible to provide COVID Boosters in your pharmacies. Okay. So the assumption When we released our full year guidance was that we will have again a weak flu season. So, we took a cautious assumption in our full year guidance. Now, we will see how it will develop, but at least we are cautious in this regard. The other question is I pass to Daniel for the booster. And answer very quickly, yes, we will be ready if there are more booster vaccinations for COVID, our staff is ready to do Yes, there are still as you see all over the world, there are still discussions ongoing. As we know, we don't need the 3rd vaccination for the ground immunization, but it could be that we need the booster, yes, every year, but there is no decision at the moment. Thank you, Daniel. We are always looking for boosters in our business. Other questions? No questions left also from the webcast. Thank you very much. So after this last question, I would like to conclude the first part of our Investor Day. We must now say goodbye to you, dear online guests at home. Thank you for taking the time to actively participate in our Investor Day. Goodbye. We look forward to welcoming you at the next opportunity.

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