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Report of the month

October 2008

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Lundbeck Copenhagen-Valby, Denmark Report Facts Company name: H. Lundbeck A/S Fiscal year end: December 31, 2007 Report title: Destination next decade Chairman of the Board: Per Wold-Olsen President and CEO: Claus Braestrup Number of books: Two Report length: 120 + 54-page magazine Auditors: Deloitte - Grant Thornton Design: Bysted A/S E-mail: jtl@lundbeck.com, palo@lundbeck.com	Report Rating 3.5/5 (Rating scale below) Profile-Products (Excerpts, as from the report) H. Lundbeck A/S is an international company with more than 50 years of experience in research, development, production, marketing and sale of pharmaceuticals for the treatment of diseases of the central nervous system. Our goal is to produce drugs which… will represent something entirely new and innovative in the treatment of psychiatric disorders and neurological diseases such as depression, schizophrenia and stroke. This is no easy task… (Annual Report p 2, Magazine p 5) (Italics are own company’s words) Key Figures Revenue: EUR 1,474 million Operating income: EUR 362 million Net income: EUR 238 million Earnings per share: EUR 1.16 Dividend per share: EUR 0.34 Return on equity: 25.3% Solvency ratio: 58.3% Number of employees: 5,134 (Source: 2007 figures sourced from the annual report) Competitors or Rivals Novo Nordisk GlaxoSmithKline AstraZeneca Pfizer Novartis Johnson & Johnson Forest Laboratories Takeda Pharmaceutical Merck ...

Triple A > Both the annual report and the magazine, sent along with it, are very reader-friendly, thanks to a simple and , smart use of various ingredients; from Contents directing to Information about disease areas -these being spread all across-; from headlines to -and this is less frequent- notes to statements. > A people-based route in both documents, in pictures and words, and also in numbers and skill-based strategy.

Double A > A good idea, here implemented with effectiveness: the “report package” comprises the annuals plus a well-designed magazine that goes further on diseases based on testimonials woven through a mission/vision thread. > Clinical development projects enhanced. Pharmaceuticals listed with year of first registration. > Strategic focus and initiatives clearly put, with an emphasis on innovation and partnerships. > Financial highlights span over five years and include six well-picked ratios. > Good historical figures which include some major ratios, also for share items. Definitions provided nearby. > Not lacking in share fundamentals: cash flow, net asset value are highlighted. Shareholders are named.

Simple A > Environment, health and safety strategy, current developments, target status fairly analyzed. > Particularly critical risks are not concealed, but many more details would help.

B Sides > Not that common: a report without a chief executive or chairman message/statement. > Should a one-page-long Financial review be named a… review? > Lagging behind on governance. Even board details are skimpy. > Many notes to statements lack in comments. > Chart power far from maximized –with many of them not going back more than one year.

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Selected Page (p 9 of Lundbeck Magazine 2008)	Rating Scale 5 First-Rate 4.5 Excellent 4 Very good 3.5 Sound 3 Average 2.5 Uneven 2 Common 1.5 Substandard 1 Poor 0.5 Uncompetitive The rating is based on ReportWatch internal desk research and does not take into account the independent Rating Panel’s judgment.