Delivering on our strategy towards 2030

In 2021, the Lundbeck Foundation announced its new strategy, Bringing Discoveries to Lives, which builds on the Foundation’s history and past achievements, but also articulates new ambitions and aspirations to be delivered during the next decade.

THE 2030 STRATEGY: BRINGING DISCOVERIES TO LIVES The Lundbeck Foundation is a commercial foundation and engaged in a broad range of commercial and philanthropic activities. The activities differ widely but also support and underpin each other, thereby creating a clear path for the Foundation’s value creation towards 2030.

The ambitions for the Foundation’s value creation during the next decade is summarised in five ‘value flags’. In 2021, important steps were taken to deliver on each of the value flags.

THE FIVE VALUE FLAGS

TOP-TIER NEUROSCIENCE The tremendous complexity of the brain makes it one of mankind’s most challenging scientific topics. Today, the world lacks basic knowledge about the brain, both with regard to the brain’s normal functioning and with regard to brain disorders. This creates an urgent need for new insights and knowledge, which can form the scientific basis for new and better treatments. An important ambition towards 2030 is to generate new knowledge that can lead to better prevention, diagnosis and treatment of brain disorders. In 2021, 79% of the Foundation’s grants were awarded to neuroscience research through a mix of strategic programmes, open calls and talent development activities, driving insight and knowledge for the benefit of patients, doctors and therapists, and further strengthening the neuroscience community in Denmark.

The Foundation supported the development and strengthening of Denmark’s life-science and neuroscience community through support for the establishment of a new master’ s degree programme in neuroscience at Copenhagen University’s Faculty of Health and Medical Science. The two-year programme was started in 2020, providing the opportunity for 30 medical students to specialise in neuroscience through their master’s degree. In 2021, the programme reported a 32% increase in student applications, including a strong increase in international applications. The Foundation also strengthened its focus on clinical research, a critical element in neuroscience as well as other areas of healthcare. The Foundation instituted a new grant targeting postdoctoral researchers (postdocs) conducting clinical research projects. The ambition is to develop a critical mass of researchers with clinical competencies, thereby nurturing an area that is fundamental for bringing discoveries to patients.

In 2021, the Foundation was finally able to celebrate two years’ winners of The Brain Prize, the world’s largest prize for brain research, at a ceremony in Copenhagen. At the ceremony, the two winners from 2020 (Huda Zoghbi and Adrian Bird, receiving the prize for their work on Rett syndrome) and the four winners from 2021 (Michael Moskowitz, Peter Goadsby, Lars Edvinsson and Jes Olesen, receiving the prize for their work on migraine) were celebrated for their outstanding work and personal commitment and dedication. The ceremony also highlighted the importance of neuroscience and brain research in the global scientific community and the Foundation’s ambition to further build Denmark’s position in neuroscience. CLOSE COLLABORATION BETWEEN RESEARCH AND BUSINESS Healthcare innovation and commercial entrepreneurship are dependent upon a constructive collaboration between the scientific research community and the commercial business world. This is seen in some of the world’s most innovative healthcare communities where talent makes the leap from science to business. This is not easy in Denmark today and an important ambition for the Foundation is to strengthen the dialogue and collaboration between Denmark’s academic research institutions and the local commercial biotech and pharmaceutical communities, allowing scientific academic talent to explore, develop, innovate and, eventually, make the leap from science to business.

In 2021, the Foundation launched a new grant initiative, Frontier Grants, which targets scientific research talent with commercially intriguing ideas and interests. The objective is to support, develop and encourage talent to embark on the challenging journey from idea generation to commercial

analysis and value proposition. The grant has no commercial ties to the Foundation but is inspired by the approach and work taking place in Lundbeckfonden Emerge, which is an active, hands-on and engaged investor in Denmark’s biotech community.

LEADING HEALTHCARE COMPANIES The ownership of Lundbeck, ALK and Falck is at the core of the Foundation’s value creation. These subsidiaries create products and treatments that benefit patients all over the world, while also driving financial returns that enable new investments in neuroscience, talent, and grant-making activities, as well as driving insights and knowledge about the brain and brain diseases, and developing the local life-science community.

Being an owner of three international healthcare companies headquartered in Denmark, gives the Foundation an important role in safeguarding and developing Denmark’s position as a leading healthcare nation. But even more important are the Foundation’s ambitions to grow and develop its subsidiaries on a global scale and to help them become leaders within their industrial segments, bringing innovations, products and treatments to patients.

In 2021, Falck took on an important role in the fight against the COVID-19 pandemic in Denmark. Less visible, but also highly important, was the underlying commercial performance of Falck’s core business areas, bearing witness to the successful turnaround in recent years. The work is still ongoing, but considerable progress has now been made. ALK also delivered a strong performance in 2021 and continues its growth journey while defining new ambitions, creating an exciting vision for the company’s future development. Lundbeck delivered another positive financial performance, and remained highly focused on delivering on its strategy, which includes building its R&D portfolio for the long-term, and will continue in the years to come. A strategic ambition for the Foundation is to expand its ownership portfolio from three, to between five and eight companies by 2030, thereby enhancing and strengthening its critical mass in Denmark’s life-science community for the benefit of all healthcare companies in Denmark. An important step for this ambition was the decision to increase the financial commitment to Lundbeckfonden Emerge’s portfolio company, IO Biotech. In November 2021, IO Biotech was listed on Nasdaq Global Market and Lundbeckfonden became the largest financial shareholder in the company.

ATTRACTIVE FINANCIAL RETURNS The investment activities of the Foundation are split into four categories: Strategic Investments (Lundbeck, ALK and Falck), Lundbeckfonden Invest (financial investments), Lundbeckfonden Ventures (international biotech investments) and Lundbeckfonden Emerge (biotech investments in Denmark). The ambition towards 2030 is to deliver financial returns which are above market peers, leading to a doubling of the Foundation’s net wealth by 2030 and enabling a doubling of its minimum philanthropic grants to DKK 1bn annually, while maintaining the Foundation’s long-term financial robustness.

2021 was a record year for the Foundation’s investments teams. Lundbeckfonden Ventures exited two portfolio companies Sanifit Therapeutics and Amplyx Pharmaceuticals – both of which were sold to pharmaceutical companies. Meanwhile, Lundbeckfonden Invest delivered a strong financial result that was well above those of relevant peers.

In total, all these activities delivered the best result in the history of the Foundation in 2021, at DKK 6,928m, and enabled philanthropic grants of DKK 803m, which was considerably above the Foundation’s current target of a minimum of DKK 500m in annual grants. ACTIVE PUBLIC VOICE As a commercial foundation in Denmark with considerable assets under management, the Foundation has obligations and a responsibility for the broader development of Denmark as hub for healthcare research and business. The Foundation pursues three strategic agendas in its external communication: The importance of brain health, Denmark as hub for scientific research in healthcare, and commercial foundations as a responsible business ownership model.

The importance of the brain health agenda was advanced through The Brain Prize which, in 2021 was awarded for work in the field of migraine – a historically overlooked disease in science and research. In addition, migraine became the key theme in the Foundation’s external communications, emphasising the continued importance of fighting noncommunicable diseases (NCDs). These activities triggered renewed public interest and debate around migraine treatment in Denmark, and led to a new partnership with the NCD Alliance and the BBC around the production of a short, documentary film about the life of a migraine patient and the life-changing impact of new migraine treatments.

In 2021, the Foundation also supported competence building and talent development among young scientists through various partnerships and activities. The Foundation continued its support for the annual PhD Cup, which is organised by the media group Information and Denmark’s national broadcaster Danmarks Radio, and trains young scientists on how to better communicate their work and scientific results. The Foundation also supported various independent media initiatives, disseminating new scientific knowledge, and started a new partnership with Bloom Festival, which cultivates a broader interest in nature and science. These events and activities are important platforms for the further development of young scientists in healthcare, and for disseminating scientific knowledge to a broader audience, making them integral to the further development of a strong healthcare community in Denmark.