Untitled

Together advancing tomorrow’s care

Integrated Annual Report 2022

Date of preparation: February 2023

Together advancing tomorrow’s care

Integrated Annual

Report 2022

UCB | Integrated Annual Report 2022

Welcome to our Integrated

Annual Report 2022

The aim of this year’s Integrated Annual Report – Together

advancing tomorrow’s care – is to provide the most up-to-date

information to all interested stakeholders about how UCB creates

value for those we serve: patients, employees, communities, the

planet and our shareholders. This is something we commit to

achieving now and into the future.

About this report

The Integrated Annual Report 2022 includes the management

report in accordance with article 12 of the Royal Decree of

14 November 2007 relating to the obligations of issuers of

financial instruments admitted to trading on a regulated market.

All information required to be included in such management

report pursuant to articles 3:6 and 3:32 of the Belgian Code of

Companies and Associations (i.e. Corporate Governance Statement

– Remuneration Report included –, Business Performance

Review and UCB’s Statement on extra-financial information)

is reported throughout all different sections of this Integrated

Annual Report. This Integrated Annual Report together with the

materiality assessment have been prepared in accordance with

the GRI Sustainability Reporting Standards and selected extra-

financial information indicated with Greek letter beta is audited

by a third party. SASB Standards provided by the Value Reporting

Foundation were also used as reference. In addition, we support the

recommendation of the Task Force on Climate-Related Financial

Disclosure (TCFD) and UCB’s TCFD disclosure summary can be

found in the Data & Reporting chapter of this report.

UCB is in scope of the EU Taxonomy Regulation, as a listed

company with more than 500 employees. We have examined

the Taxonomy-eligible economic activities listed in the Climate

Delegated Act and after review, we currently consider that our

core economic activities are not covered by the EU Taxonomy

Regulation’s technical annexes on climate change mitigation and

climate change adaptation. We will continue to monitor any future

reporting obligations and its impact.

This document contains information on investigational drug products that have

not been approved for any use by any authority in the world or new indications for

approved products. The safety and efficacy of these investigational drug products or

new indications has yet to be established.

Contents

UCB at a Glance 7

Letter to our stakeholders 8

Key figures 10

Our ambition 15

Delivering on sustainable performance 16

Our value creation model 18

A world in transition 20

Highlights 22

Our performance 23

Advancing a Healthier

Tomorrow for Patients 25

Innovating for people impacted by severe diseases 27

Developing differentiated medicines for

diverse patients 30

Our pipeline 32

Disease areas and solutions for people

living with severe diseases 34

Advancing science for women of

childbearing age across diseases 46

Ensuring product safety and quality 48

Providing access to our solutions 52

Expanding access to UCB medicines in the U.S. 57

Expanding access in low- and

middle-income geographies 58

Assessing how to move sustainable

access forward across countries 60

Partnering on digital health to create

value for patients 62

Advancing a Culture of

Care for UCB Employees 65

Nurturing our company culture 68

Putting health, safety and wellbeing first 70

Diversity, equity and inclusion 74

Employee development 76

Advancing Healthier Communities 81

Reinforcing our supply chain and

strengthening responsible procurement 83

Driving progress in healthcare

through partnerships 86

Supporting innovation around

us via UCB Ventures 88

Paying our fair share of taxes 89

Supporting underserved communities

through philanthropy 90

Advancing a Healthier Planet 97

Health of the planet goals 99

Reaching carbon neutrality by 2030 100

Reducing water usage by 20% by 2030 104

Reducing absolute waste

generation by 25% by 2030 105

Advancing Value for Shareholders 107

Value for shareholders 109

UCB | Integrated Annual Report 2022

Financials 193

1. Business performance review 194

2. Consolidated financial statements 211

3. Notes to the consolidated financial statements 216

4. Responsibility statement 291

5. Statutory auditor’s report 292

6. Abbreviated statutory financial

statements of UCB SA 299

Data and reporting 303

People data 304

Environmental data 311

GRI Standards 318

SASB 326

Independent limited assurance report on the

UCB integrated report 2022 328

Our Governance 115

Ethical Business Practices 116

1.1 Ethics & Compliance Program 117

1.2 Anti-Bribery and Anti-Corruption (ABAC) 120

1.3 Human Rights 120

1.4 Product Responsibility 121

1.5 Ethical Marketing 121

Risk Management 122

2.1 Our approach to risk management 122

2.2 Process and framework 122

2.3 Top risks in 2022 124

Corporate Governance Statement 130

3.1 Scope of reporting 131

3.2 Capital and shares 131

3.3 Shareholders and shareholders’ structure 133

3.4 Board of Directors and Board committees 137

3.5 Executive Committee 148

3.6 Diversity at Board and Executive Committee level 152

3.7 Remuneration Report 156

3.8 Main features of the internal control and

risk management systems of UCB 183

3.9 Private investment transactions and trading

in UCB shares 184

3.10 External audit 185

3.11 Information requested under article 34 of the

Royal Decree of November 14, 2007 186

3.12 Conflicts of interest – Application of article 7:96

of the Belgian Code of Companies and Associations 191

Accounting for Value 330

2022 UCB U.S. Sustainable Access

and Pricing Transparency Report

Glossary 342

Forward Looking Statement Integrated Annual Report 344

Report language 345

Availability of the Integrated Annual Report 345

Financial calendar 345

Contact 345

UCB | Integrated Annual Report 2022

UCB

at a Glance

At UCB, we believe that everyone

deserves to live the best life that they

can – as free as possible from the

challenges and uncertainty of disease.

Our work is never done.

Letter to our

stakeholders

More than 90 years of dedication to our stakeholders has made

UCB who we are today – a global biopharmaceutical company

research in immunology and neurology, paired with a relentless

drive to launch innovative medicines that change people’s lives.

In a continuously changing world, we believe we have a

responsibility to help advance tomorrow’s care together

by sharing and leveraging our experience in innovation to

contribute to a more sustainable future for all – for people,

communities and the planet. At the same time, we strive to

conduct business in a responsible way, maximizing our societal

impact while driving business growth.

There is no denying that 2022 has brought its headwinds

and external challenges. We have witnessed escalating social

inequality and barriers to accessing care, increased impacts of

climate change, the devastating war in Ukraine and all its social

consequences, and some of the highest inflation in decades.

At the same time, we experienced some internal headwinds

within UCB: we noted the impact from the loss of exclusivity for

E KEPPRA

** in Japan, and VIMPAT

** in the U.S. and Europe.

We were also confronted with a delay in bringing bimekizumab

to the U.S. Still, our legacy in innovation and care underpinned

by sustainable growth remains intact and continued to guide us

through 2022.

With this Integrated Annual Report, we share our financial and

extra-financial performance, demonstrating tangible examples

of what we have done and what we will continue to do

together with our stakeholders – all with the aim to advance the

future of care.

Dear patients, colleagues, shareholders,

and representatives from communities

where we live and work,

Creating moments that matter for

people impacted by severe diseases

In 2022, we touched the lives of over 3.4 million patients

worldwide by offering impactful medicines to communities

around the globe. Putting patients at the heart of everything we

do, we continued to expand our clinical pipeline, which now

encompasses 9 clinical development medicines. Additionally,

potential new indications and treatment options are undergoing

regulatory review. These new advances are set to help people live

their best possible lives.

Over the past year, we gained reimbursement for more new

patients across geographies, as measured by our Access Coverage

Performance Index, in addition to piloting our social business

model in Mumbai, India.

We were able to offer BIMZELX

▼

*(bimekizumab) to more than

4 000 people in 16 countries, and experience how we are truly

making an impact on the lives of people living with psoriasis. And

while we were disappointed to face an initial regulatory delay in

the United States, the U.S. Food and Drug Administration (FDA) has

since accepted for review our resubmission for bimekizumab

, and

we look forward to bringing bimekizumab to adult patients with

psoriasis in the U.S. as soon as possible – expected by middle of

2023. The regulatory review for bimekizumab

†2

in psoriatic arthritis

and axial spondyloarthritis in Europe is ongoing with expected

feedback this coming summer, too.

We filed applications with regulatory authorities for

rozanolixizumab

††3

and zilucoplan

††4

for the treatment of adults

with generalized myasthenia gravis (gMG). In this regard, we

expect to hear about rozanolixizumab

††

from the FDA in Q2

2023 (as it has been designated for Priority Review) and from the

European Medicines Agency (EMA) in Q1 2024. For zilucoplan

††

expect feedback from both the FDA and the EMA in Q4 2023.

▼

This medicinal product is subject to additional monitoring. This will allow quick identification of new safety information. Healthcare professionals are asked to report any suspected

adverse reactions.

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

† bimekizumab is an investigational drug product that has not been approved for any use by any authority in the world for PsA, axSpA and HS.

†† This is an investigational drug product and its safety and efficacy has not yet been established. It has not been approved for any use by any authority in the world.

1 For the treatment of adults with moderate to severe plaque psoriasis. UCB Announces FDA Acceptance of BLA Resubmission for Bimekizumab.

Available at: https://www.ucb.com/stories-media/Press-Releases/article/UCB-Announces-FDA-Acceptance-of-BLA-Resubmission-for-Bimekizumab. Last Accessed: January 2023.

2 Being reviewed for the treatment of adult patients with active psoriatic arthritis (PsA), and adult patients with active axial spondyloarthritis (axSpA). European Medicine Agency Accepts

Marketing Authorization Applications for Bimekizumab in Psoriatic Arthritis and Axial Spondyloarthritis. Available at: https://www.ucb.com/stories-media/Press-Releases/article/European-

Medicine-Agency-Accepts-Marketing-Authorization-Applications-for-Bimekizumab-in-Psoriatic-Arthritis-and-Axial-Spondyloarthritis. Last Accessed: January 2023.

3 Being reviewed for the treatment of adults with generalized myasthenia gravis (gMG) who are anti-acetylcholine receptor (AChR) or anti-muscle-specific tyrosine kinase (MuSK) antibody

positive. UCB announces rozanolixizumab BLA for the treatment of generalized myasthenia gravis filed with U.S. FDA and designated for Priority Review. Available at: https://www.ucb.

com/stories-media/Press-Releases/article/UCB-announces-rozanolixizumab-BLA-for-the-treatment-of-generalized-myasthenia-gravis-filed-with-US-FDA-and-designated-for-Priority-

Review. Last Accessed: January 2023.

UCB | Integrated Annual Report 2022

Pursuing scientific innovation remains core to UCB’s

ambition to bring differentiated treatments to people living with

severe diseases. We partner with stakeholders across the world, to

drive this innovation further and faster.

With EVENITY

▼

(romosozumab), together with our partners

we reached since launch more than 400 000 people living with

osteoporosis at high risk of fracture. We also welcomed Zogenix,

Inc. to the UCB family and were thrilled to get new approvals for

FINTEPLA

▼

(fenfluramine) in the U.S.

and EU

for treatment

of seizures associated with Lennox-Gastaut syndrome (LGS). In

addition, FINTEPLA

** has also been approved for the treatment

of seizures associated with Dravet syndrome in Japan

All of this translated into another year of solid business results

for UCB – reaching the upper end of our financial guidance,

with revenue of € 5.52 billion and net sales of € 5.14 billion,

based on good product growth, the launch of BIMZELX

* and

the addition of FINTEPLA

**. This was more than offset by the

effects of the loss of exclusivity for E KEPPRA

**(levetiracetam)

in Japan and VIMPAT

** (lacosamide) in the U.S. and Europe.

CIMZIA

** (certolizumab pegol) reached over 1 million patient-

years since launch, achieving the peak sales target of € 2 billion

two years ahead of schedule.

Together with our scientific excellence, our biggest strength

remains the dedication of our UCB colleagues whom we

continue to support by fostering a diverse, inclusive and

engaging working environment for all. For the first time, we

released our inclusion index, and continue to measure health,

safety and wellbeing across UCB. We saw a small decline in our

health, safety and wellbeing index score to 80.4% (down from

81.9% in 2021) and are already working on tailored approaches

to better understand the root causes and address them in 2023.

With climate change increasingly impacting communities

around the world, we have begun decoupling our GHG

emissions from our growth. We continue to partner with our

suppliers to reduce our emissions, and we are well on track to

deliver on our science-based targets.

Our company success is underpinned by our holistic approach

that takes a long-term view of how UCB can bring positive

impact for people living with severe diseases, our colleagues

and communities, our shareholders and the planet.

Together, advancing tomorrow’s care

Pursuing scientific innovation remains core to UCB’s ambition

to bring differentiated treatments to people living with severe

diseases. We partner with stakeholders across the world, to drive

this innovation further and faster.

Venturing into 2023, we are confident in our strong growth and

our ability to create value. We have an unprecedented string of

potential upcoming launches: in psoriasis in the U.S., in psoriatic

arthritis and across the full spectrum of axial spondyloarthritis

(axSpA) in Europe and Japan, and in generalized myasthenia gravis

(gMG) in the U.S., Europe and Japan. We will continue building

and strengthening a portfolio of solutions across immunology,

neurology and other areas where our expertise and innovation

align with the unmet needs of those we serve. And we will further

strengthen our company to meet what lies ahead through cost

discipline and wise allocation of resources that delivers stronger

impact by bringing cutting-edge research to market.

We focus on developing tailored solutions for specific populations,

and take tangible steps to move from symptomatic treatment

to disease modification and possibly towards cures for severe

diseases. Above all, those who live with severe diseases light our

way and hold us true to our purpose – ensuring that we always

see the person and not just the disease. To this end, we are

grateful to our Patient Ambassadors Beth, Candace and Thomas

for having reviewed the Integrated Annual Report to bring their

own perspective to life.

We have come a long way and thanks to impactful partnerships,

our scientific innovation capabilities, and the commitments of

our dedicated employees and partners, we can look towards

the future with confidence. That future will be built on the

collaborations forged today, and for that reason, we would like to

thank you for your part in the UCB journey.

Acting together with focus and care, keeping our impact on

society and the planet in mind, we aim to create sustainable value

and make real improvements in the lives of the people we serve,

now and into the future.

Jean-Christophe Tellier, Chief Executive Officer

Fiona du Monceau, Chair of the Board ad interim

4 Being reviewed for the treatment of generalized myasthenia gravis (gMG) in adult patients who are acetylcholine receptor antibody positive (and who require treatment in addition

to steroids or non-steroidal immunosuppressants, for the EU). UCB announces U.S. FDA acceptance of new drug application and EMA MAA validation for zilucoplan for the

treatment of generalized myasthenia gravis in adult patients. Available at: https://www.ucb.com/stories-media/Press-Releases/article/UCB-announces-US-FDA-acceptance-of-

new-drug-application-and-EMA-MAA-validation-for-zilucoplan-for-the-treatment-of-generalized-myasthenia-gravis-in-adult-patients. Last Accessed: January 2023.

5 FINTEPLA

US PI. Available at: https://www.ucb-usa.com/fintepla-prescribing-information.pdf Last Accessed: February 2023.

6 FINTEPLA

EMA SmPC. Available at: https://www.ema.europa.eu/en/documents/product-information/fintepla-epar-product-information_en.pdf. Last Accessed: February 2023.

7 FINTEPLA

oral solution has been approved by the Japanese Ministry of Health, Labour and Welfare (MHLW) for the treatment of seizures associated with Dravet

syndrome as an add-on therapy to other anti-epileptic medicines for patients 2 years of age and older. Available at: https://www.pmda.go.jp/PmdaSearch/iyakuDetail/

ResultDataSetPDF/820110_1139016S1020_1_01. Last Accessed: January 2023.

As of December 2022

Key figures

UCB | Integrated Annual Report 2022

1 CO₂e emissions that UCB directly controls are Scope 1, 2 and 3 emissions (except the emissions

from purchased goods and services), compared to our 2015 baseline in absolute numbers

Our 8 703 colleagues

around the globe in 36 countries put patients at

the heart of everything they do. UCB is headquartered in Belgium.

1 Scope of reporting: this number represents all UCB regular active employees as of December 31st, 2022

Students, apprentices, trainees, employees on leave and contractors are not included in the headcount data.

UCB | Integrated Annual Report 2022

Three research hubs strengthen our research and development

in Belgium, the United Kingdom, and the United States.

Our Purpose

We create value for patients now and into the future

UCB | Integrated Annual Report 2022

Our ambition

At UCB, our work is never done – because we always strive to

find new ways to deliver solutions to people living with severe

diseases and those who care for them.

We innovate to deliver unique outcomes that help

patients achieve their life goals, ensure access for

those who need our solutions, and create the best

individual experience for them in a way which is viable

for society, our investors and UCB.

Over 90 years of innovation has made us who we are

today. Decades of scientific excellence have seen us

launch life-changing medicines and develop expertise.

We built momentum through pioneering research and

evolving science and technology, ensuring we can

discover and develop new medicines effectively and

build on our existing strengths.

Making a positive impact on society has always been

part of our core mission. We work in a way that is

sustainable as we deliver value for the people who

need our solutions and those who care for them, for

our employees, for the communities where we live

and work, for our shareholders, and for the planet.

Delivering on

sustainable performance

We conducted a full materiality

assessment in 2019 and updated the

assessment in 2021. We engaged

stakeholders to identify the issues

that have the biggest impact on

our business, society and the

environment, and those that matter

most to them. Going forward, we are

committed to updating our materiality

assessment in 2023. This process

fulfils the requirements of the

Global Reporting Initiative (GRI).

We aim to drive sustained growth

while making a positive impact on

society in the following areas.

At UCB, sustainability is our business approach. Society currently

faces significant challenges that transcend geographical borders and

organizational boundaries – from deepening social inequalities to climate

change – where we believe we can deliver value.

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INCREASING MATERIALITY

Enhancing availability, accessibility, and aordability

of UCB solutions for the patients who need and can

benefit from them in order to allow patients to live

their best lives and reduce health inequities.

Access to

Medicines

Innovating to bring to patients dierentiated

and accessible solutions that meet patient

and societal needs.

Scientific

Innovation

Ensuring the safety and quality of UCB

solutions and timely communication of safety

or quality topics.

Product Safety

& Quality

Leveraging digital technologies, including data

collection and analysis, to generate and better

measure impact, while still protecting data

security and privacy.

Data &

Technology

Embedding ethical business practices across the

organization and driving integrity and

transparency in interactions with stakeholders,

including respect for human rights.

Ethical Business

Practices

Improving UCB employees’ health, safety and

wellbeing across all our geographies, including

by adapting ways of working.

Employee

Health, Safety

& Wellbeing

Contributing to improving

healthcare-related infrastructure and

services as well as evidence-based policies

to enable delivery of care.

Healthcare

System

Strengthening

Protecting the health of the planet by

reducing the negative impact of UCB’s

activities and solutions on the environment

across the company’s value chain.

Environmental

Footprint

Empowering employees by cultivating diversity

and creating the right conditions for all

employees to bring their best selves to work.

Diversity, Equity

& Inclusion

Oering UCB employees the best

opportunities to develop their

knowledge and skills.

Employee

Development

UCB | Integrated Annual Report 2022

We continuously refine our impact measurement by

developing key performance indicators, based on these

material topics. In this way we assess the value we create

for patients, our employees, the communities where we

live and work, and our shareholders, as well as our effect

on the planet.

Together with our Sustainability Governance Committee,

UCB’s External Sustainability Advisory Board gathers

influential thought leaders to provide an outside perspective.

Working with our Executive Committee and other senior

leaders, their role is to help us stay on track with what society

expects from a sustainable biopharma leader, inspiring and

challenging our sustainability efforts.

LEARN MORE

Did you know?

As signatory to the UN Global Compact, we endorse the UN

Sustainable Development Goals – particularly ‘Good health and

wellbeing’ and ‘Partnership for the goals’, where our biggest

impact lies. To better understand our overall contribution to

the 2030 United Nations Agenda for Sustainable Development,

see our GRI tables with SDGs mapped per topic.

Our value creation model

Our approach places those we serve and their caregivers at the heart of everything

we do. We incorporate their individual experiences, and the moments that matter

to them, in the discovery, development and delivery of our medicines. We leverage

their insights to inform our science and develop innovative and differentiated

solutions for specific patient populations.

Inputs Outcomes

From Solution to Patient

We strive for a unique patient

experience, providing solutions

with the highest possible impact.

From Science to Solution

We aim to translate

scientific hypotheses

into innovative solutions

and engage patients

in the journey.

From Patient to Science

We pursue a deep

understanding of patient

sub-populations to

develop an original

scientific hypothesis.

Being a responsible

actor in society

• 949 671 GigaJoules of energy

consumed

• 526 021m water withdrawn

Planet

• €739 million Cash ﬂow

• €9.1 billion equity

• €2 000 million net debt

Financials

• Approximately 11 800

patients in clinical trials

• Engaged with 369 patient

organizations

• We strive to engage with patients

along the clinical development

continuum to ensure we include

patient voices and diverse

perspectives in our clinical programs

Patients

• 8 703 UCB employees

including 343 R&D scientists

• 887 contractors

Our People

• >140 global academic

non-commercial partnerships

• €3 million donated by two UCB

philanthropic funds

• Approx. 13 000 suppliers

Communities

Patients

• >3.4 million patients

• 35% reimbursement for all patients

within regulatory label and 42%

reimbursement for some,

but not all patients within

regulatory label

• 49 launches

• 9 medicines in clinical

development

Our People

• 972 jobs created

• 10.9% turnover rate

Communities

• 153 publications

• 143 projects supported by the UCB

Community Health Fund since

launch

• € 91 million income tax

Planet

• 58% reduction in COe emissions

since 2015 baseline

• 5 821tons of waste

Financials

• €1 260 million of adjusted EBITDA

• Dividend proposal of €1.33 per

We utilize our resources, skills and expertise to maximize the

value we create for our different stakeholders.

UCB | Integrated Annual Report 2022

We leverage the insights of those we serve and their caregivers

to inform our science and develop innovative and differentiated

solutions for specific patient populations.

1 The scope is all Phase I to IV and NIS Prospective Studies (excluding RWE and other survey studies) which were active in 2022. An active study is any study that has

had a patient in screening or treatment during the year.

2 This number represents all UCB regular active employees as of December 31, 2022. Students, apprentices, trainees, employees on leave and contractors are not

included in the headcount data.

3 Includes all employees belonging to the job family Research & Early Development and all scientist related job codes/having “scientist” in their job title.

4 Headcount of contractors by December 31, 2022. UCB considers contractors as individuals, employed by third party companies, who are qualified and skilled,

providing a service to support delivery of UCB business objectives for a limited, defined period of time and paid via a day or hourly rate. No relevant fluctuations

during the reporting period.

5 Includes academic institutions, studentships, collaborative research and non-commercial partnerships such as research consortia (e.g. IMI), academic societies.

6 Donated through the UCB Community Health and UCB Innovation for Health Equity Funds in 2022.

7 Cash Flow generation before dividend, acquisition/divestment & paying back debt.

8 New launch is defined as new product entry and/or indication expansion in a country.

9 Only includes assets that have progressed into phase 2 and beyond.

10 This figure represents the number of roles that are created in UCB within a specific time period and are filled by a candidate following an active recruitment process

regardless of the candidate’s source (internal or external) at all levels of the organization. This figure broadly represents the number of UCB opportunities created

and subsequently filled across all our geographies and it excludes contingency workforces, contractors and consultants.

11 Includes voluntary and involuntary turnover.

12 UCB-authored publications in 2022 (only full papers).

A world in transition

Occurrences taking place within this setting have a significant

impact on people living with severe diseases, our employees,

the communities where we operate, the planet, and our

shareholders – and include the war in Ukraine, the ongoing

COVID-19 pandemic, climate change, cybersecurity threats and

myriad economic headwinds. These emergent challenges have

contributed to a volatile environment that affects UCB, like many

other businesses.

As a global company, we acknowledge that we are in a world in

transition; and we believe in deepening our impact by addressing

these challenges where our expertise and wider societal

interests converge. By doing so we not only create value for

our stakeholders but also decrease our exposure to long-term

environmental, social and governance (ESG) risks.

Cybersecurity – a lingering

threat in an increasingly

connected world

Climate change –

a multifaceted crisis

Technology is changing how patients experience healthcare,

how doctors and nurses practice medicine, and how

pharmaceutical companies like ours provide therapies and

treatments to those who need them. Delivering the flexible,

holistic healthcare journeys that patients increasingly expect

requires digital infrastructure, which comes with increased

cybersecurity vulnerabilities.

As the healthcare sector has adopted these technologies

and ways of working, so too has the number of cyberattacks

grown. Cybersecurity and data privacy in all forms are of

utmost importance to UCB.

The link between public and planetary health is

multifaceted. Environmental issues can impact public

health in endless ways, including health conditions linked

to climate – such as vector- and water-borne diseases,

and social determinants – and by deepening pre-existing

inequities and putting pressure on health-related costs

for authorities and governments.

It is now clearer than ever that a concerted multi-partner

approach at a global level is the best way to overcome

these climate-related consequences effectively.

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As a global company, we

acknowledge we are in a

world in transition

Through 2022 and beyond, we face an increasingly

complex operating environment in which intersecting

crises threaten global progress and prosperity.

UCB | Integrated Annual Report 2022

War in Ukraine

and supply chain disruptions

Social polarization and trust

COVID-19 – a catalyst for

health inequity and mental health

Inequity continues to grow

The war in Ukraine has been a challenge for all of us.

UCB serves patients both in Russia and Ukraine – the

responsibility is on us to deal with the consequences of

the war on patients, employees and their families.

This event has also highlighted the ways in which

global supply chains are at risk, leading companies,

policymakers, and other stakeholders to evaluate how

to make them more resilient to sudden and long-

term changes.

Income equality and precarious economic conditions

continue to divide our society.

Global hyperconnectivity has unlocked unprecedented

access to information – including dis- and

misinformation – creating new challenges for scientific

institutions to establish and maintain trust.

The frustration arising from polarization can lead

to less stakeholder willingness to work together

toward positive collective outcomes. That is why our

partnerships are so important to us.

Health systems across the globe continue to contend

with repercussions from the pandemic, as resources for

non-communicable and chronic diseases waned, health

inequity widened, and economic growth was muted.

At the same time, mental health concerns are rising, with

mental health expected to become a major global cause

of morbidity and mortality over the coming years.

In many societies, there continue to be barriers to

accessing basic resources such as education or health

services and medicines.

Global health is still characterized by inequities between

certain groups. Yet with the right programs, strategies,

resources and partnerships in place, health gaps can

be narrowed so that nobody is excluded from living a

long and healthy life, due to where they were born, or

where they live.

LEARN MORE

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

† bimekizumab is an investigational drug product that has not been approved for any use by any authority in the world for PsA, axSpA and HS.

†† This is an investigational drug product and its safety and efficacy has not yet been established. It has not been approved for any use by any authority in the world.

1 Australia SmPC. Available at: https://www.tga.gov.au/resources/auspmd/bimzelx. Last Accessed: February 2023.

2 Canada SmPC. Available at: https://pdf.hres.ca/dpd_pm/00064702.PDF. Last Accessed: February 2023.

3 Saudi Arabia SmPC. Available at: https://www.sfda.gov.sa/en/drugs-list. Last Accessed: February 2023.

4 Switzerland SmPC. Available at: https://www.swissmedic.ch/swissmedic/de/home/humanarzneimittel/authorisations/new-medicines/bimzelx-injlsg-fertigspritze-bimekizumabum.html.

Last Accessed: February 2023.

5 United Arab Emirates Ministry of Health & Prevention.

6 Pharmaceuticals and Medical Devices Agency. New Drugs Approved in FY 2021. https://www.pmda.go.jp/files/000246734.pdf. Last Accessed: February 2022

7 UCB. UCB Announces FDA Acceptance of BLA Resubmission for Bimekizumab. Available at: https://www.ucb.com/stories-media/Press-Releases/article/UCB-Announces-FDA-

Acceptance-of-BLA-Resubmission-for-Bimekizumab. Last Accessed: January 2023.

8 For patients 2 years to 18 years of age with CDKL5 Deficiency Disorder (CDD) and uncontrolled seizures. Clinicaltrials.gov. Fenfluramine in CDKL5 Deficiency Disorder (CDD).

Available at: https://clinicaltrials.gov/ct2/show/NCT03861871. Last Accessed: January 2023.

9 A Study of the Efficacy and Safety of MT1621 in Thymidine Kinase 2 (TK2) Deficiency (Treatment naïve).

Available at: https://clinicaltrials.gov/ct2/show/NCT04581733?term=MT1621&draw=2&rank=1. Last Accessed: February 2023.

10 McInnes I, Coates L, Landewé R.B.M. et al. Bimekizumab in bDMARD-Naïve Patients with Psoriatic Arthritis: 24-Week Efficacy & Safety from BE OPTIMAL, a Phase 3, Multicentre,

Randomised, Placebo-Controlled, Active Reference Study. Abstract presented at EULAR 2022.

Highlights

Launch of BIMZELX

* gains momentum

UCB’s treatment BIMZELX

* (bimekizumab) is delivering fast,

deep and durable skin clearance for adults living with moderate

to severe psoriasis.

2022 saw additional regulatory approvals for BIMZELX

* as a

treatment for adults with moderate to severe plaque psoriasis

who are candidates for systemic therapy (or phototherapy, for

Australia and Canada) in Australia

, Canada

, Saudi Arabia

and

Switzerland

, as well as the UAE

in January 2023. In Japan

BIMZELX

* was approved for the treatment of plaque psoriasis,

generalized pustular psoriasis and psoriatic erythroderma

in patients who are not sufficiently responding to existing

treatments. Following receipt of a Complete Response

Letter from the U.S. Food and Drug Administration (FDA)

in May stating certain pre-license inspection observations

must be resolved before approval, our resubmission of the

Biologics License Application (BLA) was accepted for review in

December 2022

. We are committed to offering bimekizumab

†

to patients in the U.S.

Integration of Zogenix

UCB acquired Zogenix, Inc. in March 2022, reinforcing our

commitment to create greater value for people living with

severe forms of epilepsy. This allows us to progress our

ambition to offer FINTEPLA

** (fenfluramine) to more people

living with rare epilepsies, with new approvals for Dravet

syndrome indication in Japan and Lennox-Gastaut syndrome

(LGS) indication in the U.S. and lately in the EU. Additionally,

we are currently in phase 3 clinical studies for an additional

indication for fenfluramine

††8

(cyclin-dependent kinase like-5,

CDKL5 deficiency disorder) and pre-submission phase for

doxecitine and doxribtimine (doxTM

††

) treating thymidine

kinase 2 deficiency (TK2d)

. Following an in-depth evaluation

and alignment with key regulatory agencies on the filing

strategy for doxTM

††

, regulatory submissions are now planned

for H1 2024.

Advancing treatment for generalized myasthenia

gravis (gMG)

We announced acceptance by the U.S. FDA for review of the New

Drug Application and EMA Marketing Authorization Application

(MAA) validation for zilucoplan

††

for treatment of adult patients with

AChR-Ab+ gMG (and who require treatment in addition to steroids

or non-steroidal immunosuppressants, for EU)

The U.S. FDA also accepted the filing to review a Biologic License

Application (BLA) for investigational treatment rozanolixizumab

††

and designated it for Priority Review. The EMA validated the MAA for

rozanolixizumab

††

as well. The two regulatory agencies are reviewing

rozanolixizumab

††

for the treatment of gMG in adult patients who

are AChR or MuSK antibody positive (and require therapy in addition

to corticosteroids or non-steroidal immunosuppressants, for EU)

Accelerating clinical studies with bimekizumab

†

Our two Phase 3 studies to evaluate the efficacy and safety of

bimekizumab

†

in treating adults with active psoriatic arthritis who were

biologic disease-modifying anti-rheumatic drug naïve (BE OPTIMAL

and in adults who had an inadequate response or intolerance to tumor

necrosis factor inhibitors (BE COMPLETE

), showed clinically relevant

improvements in both joint and skin symptoms.

Two Phase 3 studies evaluating the efficacy and safety of

bimekizumab

†

in adults with active non-radiographic axial

spondyloarthritis (nr-axSpA; BE MOBILE 1), and in adults with active

ankylosing spondylitis, also known as radiographic axSpA (BE MOBILE

show that bimekizumab

†

achieved consistent improvements versus

placebo in signs and symptoms across the full spectrum of axSpA.

Further clinical studies (BE HEARD 1

+ 2

) to evaluate efficacy and

safety of bimekizumab

†

in people living with moderate to severe

hidradenitis suppurativa suggested that targeting IL-17F in addition to

IL-17A may be a promising treatment approach.

The safety profile of bimekizumab

†

was consistent with safety data

seen in previous studies with no new observed safety signals.

UCB | Integrated Annual Report 2022

Our performance

11 Merola JF, Mcinnes I, Ritchlin CT et al. Bimekizumab in Patients with Active Psoriatic Arthritis and an Inadequate Response to Tumour Necrosis Factor Inhibitors: 16-Week

Efficacy & Safety from BE COMPLETE, a Phase 3, Multicentre, Randomised Placebo-Controlled Study. Abstract presented at EULAR 2022.

12 Baraliakos X, Deodhar A, van der Heijde D, et al. Bimekizumab maintains improvements in efficacy endpoints and has a consistent safety profile through 52 weeks in patients

with non-radiographic axial spondyloarthritis and ankylosing spondylitis: results from two parallel Phase 3 studies. #L14 Presented at ACR Convergence 2022.

13 ClinicalTrials.gov. A Study to Test the Efficacy and Safety of Bimekizumab in Study Participants With Moderate to Severe Hidradenitis Suppurativa (BE HEARD I).

Available at: https://clinicaltrials.gov/ct2/show/NCT04242446. Last Accessed: February 2023.

14 ClinicalTrials.gov. A Study to Test the Efficacy and Safety of Bimekizumab in Study Participants With Moderate to Severe Hidradenitis Suppurativa (BE HEARD II).

Available at: https://clinicaltrials.gov/ct2/show/NCT04242498. Last accessed: February 2023.

15 UCB.com. UCB announces U.S. FDA acceptance of new drug application and EMA MAA validation for zilucoplan for the treatment of generalized myasthenia gravis in adult

patients. Available at: https://www.ucb.com/stories-media/Press-Releases/article/UCB-announces-US-FDA-acceptance-of-new-drug-application-and-EMA-MAA-validation-for-

zilucoplan-for-the-treatment-of-generalized-myasthenia-gravis-in-adult-patients. Last Accessed: January 2023.

16 UCB.com. UCB announces rozanolixizumab BLA for the treatment of generalized myasthenia gravis filed with U.S. FDA and designated for Priority Review.

Available at: https://www.ucb.com/stories-media/Press-Releases/article/UCB-announces-rozanolixizumab-BLA-for-the-treatment-of-generalized-myasthenia-gravis-filed-with-

US-FDA-and-designated-for-Priority-Review. Last Accessed: January 2023.

17 This number includes assets that have progressed to phase 1 and beyond.

18 As published in the 2021 Integrated Annual Report, a new baseline for the Access Coverage Performance Index was set at the end of 2021, to include additional countries and

additional products (BIMZELX

and NAYZILAM

). All indications that became out of patent in 2022 were removed from the baseline as well. The baseline to compare 2022

results is therefore 30% reimbursement for all patients within regulatory label and 38% reimbursement for some, but not all patients within regulatory label.

19 CO₂e emissions that UCB directly controls are Scope 1, 2 and 3 emissions (except the emissions from purchased goods and services), compared to our 2015 baseline in

absolute numbers.

20 Water withdrawal reduction compared to 2015 baseline.

2020 2021 2022

Financial Performance

Sustainable growth

Revenue (€ million) 5 347 5 777 5 517

Adjusted EBITDA/revenue ratio 27% 28% 22.8%

R&D expense/revenue ratio 29% 28% 30%

Extra-financial Performance

Value for Patients

# Medicines in clinical development

5 7 9

Access Coverage Performance Index

Reimbursement for all patients within regulatory label 30% 31% 35%

Reimbursement for some, but not all patients within regulatory label 54% 55% 42%

No reimbursement, or reimbursement is pending 16% 14% 23%

Value for People

Health, Safety and Wellbeing Index 78.4% 81.9% 80.4%

Diversity, equity and inclusion

% Female/male [executive level] 34%/66% 37%/63% 38%/62%

Inclusion index 70.7%

Value for Planet

Absolute reduction in carbon emissions for operations we directly control

-60% -62% -58%

% of suppliers (by CO₂e emissions) committed to science based targets 11% 21% 30%

Absolute reduction in water withdrawal

-30% -29% -35%

The financial and extra-financial data are reported for the period 1 January – 31 December. Financial data is reported semi-annually,

and extra-financial data is reported annually. This Integrated Annual Report was published on February 22, 2023.

UCB | Integrated Annual Report 2022

Advancing a

Healthier

Tomorrow

for Patients

We innovate to bring differentiated solutions to

people living with severe diseases, and to make

real improvements in the lives of the people we

serve. By doing so, we aim to create value now

and into the future.

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to

severe plaque psoriasis in adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque

psoriasis, generalized pustular psoriasis and psoriatic erythroderma in patients who are not sufficiently responding to existing treatments.

UCB | Integrated Annual Report 2022

Did you know?

Innovating for people

impacted by severe diseases

Scientific innovation allows UCB to fulfil its ambition to bring

differentiated treatments to people living with severe diseases.

We prioritize research that goes where patient insight and science

leads us, moving our portfolio towards differentiated solutions with

higher predictability of response for each patient.

By developing differentiated solutions for specific patient populations,

we are taking tangible steps to move from symptomatic treatment to

disease modification, and possibly towards cures for severe diseases.

Our investment in the next generation of science and technologies

and engagement with scientific partners across the world lets us

explore new modalities such as the potential to develop novel

medicines through AI, gene therapy and targeted protein degradation,

while still building on our core heritage and areas of expertise.

UCB continues efforts to address unmet needs in immunology

and

neurology

, building on three research platforms: New Chemical

Entities (small molecules and peptides), New Biological Entities

(monoclonal antibodies) and Advanced Therapeutic Medicinal

Products (ATMP)

. By assessing solutions beyond medicines, and by

expanding to devices or digital health solutions through data and

AI in early research, we aim to ensure an optimal individual patient

experience through continuous innovation across all dimensions of

research and early development.

1 Immunology TA focused on chronic immune-mediated inflammatory disorders (IMIDs): immune reset, skin inflammation and joint inflammation.

2 Neuroscience TA focused on epilepsy, neurodegeneration and neuroinflammation.

3 Of note, the current gene therapy portfolio is fully embedded within the neuroscience scope.

30%

of our revenues are

reinvested in R&D

Scientific innovation is a long-term investment. While

there is a level of uncertainty to developing new therapies,

we manage risks so we can maintain our ability to

deliver impactful solutions for patients. Risks associated

with Scientific Innovation are reported in the Risk

Management section.

We strive to create a culture that fosters innovation, where

creative minds and people determined to innovate can

come together. Our new UK research hub in Windlesham

and biologics plant at Braine-l'Alleud, Belgium support

cutting-edge R&D efforts.

Strategic

Research Centres

Braine-l’Alleud (Belgium)

Slough (U.K.)

Boston (U.S.)

Manufacturing

Sites

Braine-l’Alleud (Belgium)

Zhuhai (China)

Saitama (Japan)

Bulle (Switzerland)

Research

Satellites

Durham (U.S.)

Seattle (U.S.)

Leuven (Belgium)

Kings College London (U.K.)

Development

Sites

Braine-l’Alleud & HQ (Belgium)

Leuven (Belgium)

Monheim (Germany)

Raleigh (U.S.)

Slough (U.K.)

Boston (U.S.)

Tokyo (Japan)

Shanghai (China)

We strive to create a

culture that nurtures and

fosters innovation

UCB | Integrated Annual Report 2022

Our innovation engine is fueled by external collaborations

with academic teams and biotech companies, backed by

UCB Ventures investment to develop new technologies

that complement our existing capabilities to break through

into new areas.

Digitizing biology

with Roswell’s

Molecular

Electronics Chip

Patient

Engagement

Council for

Parkinson’s Disease

Collaborating with

GliaPharm in the

field of epilepsy

treatment

Epilepsy Research

Collaboration with

Praxis Precision

Medicines

LEARN MORE LEARN MORELEARN MORE LEARN MORE

In 2022, UCB unveiled a new collaboration with Swiss

biotechnology company GliaPharm, which specializes in

developing treatments for neurological and psychiatric

disorders. GliaPharm will use their proprietary GliaX

technology platform to validate a series of therapeutic

targets that we believe will enhance UCB's efforts in

discovering drugs for epilepsy.

As a leader in epilepsy treatment, this collaboration shows

how partnerships can enable UCB to develop solutions

that shift from providing symptomatic relief to developing

therapies that address the underlying causes of certain

epilepsies – helping to shape the treatments of tomorrow.

Accelerating target-based

discovery for epilepsy with

GliaPharm

Spotlight:

We also collaborate with patient communities to give a voice to

those we serve, ensuring their needs are considered during the

development process and lifecycle.

Some key initiatives we partnered on in 2022 included:

Developing differentiated

medicines for diverse patients

By really listening to and engaging with diverse patients as partners, we strive to

improve our clinical studies with greater understanding of their needs.

Alongside leveraging new technologies and adaptive clinical study

design to enhance patients’ experience, we have further developed

digital solutions to reduce study timelines and improve access for a

more diverse range of participants.

We adhere to the highest ethical standards for clinical research

and comply with international regulations and guidelines, codes,

principles, and local laws designed to protect patient rights, safety

and data integrity. When we outsource clinical study activities, we

commit to regular monitoring and holding our vendors to these

same standards.

Data sharing to accelerate innovation

UCB believes sharing data with other researchers will advance

science, leading to new discoveries and treatments that will

ultimately help patients. We accept requests from qualified

researchers to access anonymized patient-level data and

redacted study documents, enabling research on existing data

while reducing further exposure for patients. In 2022, we fulfilled

requests for the sharing of UCB data from 29 eligible completed

anonymized studies.

Ensuring clinical studies support health equity

Our commitment to clinical studies that address health disparities

and close the gap on global clinical trial diversity – in age, sex,

gender, race, ethnicity, socioeconomic status, genetic disposition

and geographic location – has been reinforced within our clinical

teams. Several new initiatives strengthen our ambition around

diversity in clinical studies, including:

2022 Performance

46%

of eligible UCB studies

implemented a Decentralized

Clinical Trial model

LEARN MORE

Patient-friendly

protocols

Decentralized Clinical

Trials (DCTs)

New guidance &

training module

for UCB clinical

development teams

Ethnic representation

in the clinical

research teams

30 weeks

Up to

saved in clinical studies

through implementing

digital solutions

UCB | Integrated Annual Report 2022

White

U.S. Census

Asian Other or mixed American Indian Native HawaiianBlack or African

76.3%

77.8%

13.4%

5.9%

2.8%

15.0%

3.3%

2.5%

1.3%

0.8%

0.2%

0.7%

10%

30%

40%

50%

60%

70%

20%

80%

UCB

Race & ethnicity

We reviewed UCB’s enrolment performance (2015 – 2020)

in U.S.-based studies compared to 2020 U.S. Census

Bureau data – showing we exceeded U.S. census data for

Black/African Americans, while representation of other

populations can still be improved.

We recognize the journey to diverse clinical studies on a global

scale will not be resolved immediately. By taking a variety of

approaches, we are learning and implementing new ideas

that help us progress. We are committed to ensure people

from diverse backgrounds join our clinical studies as it is key to

advancing health equity.

1 UCB internal data includes all trials completed during the period 2015 - 2020 with n>25 patients

2 https://www.census.gov/programs-surveys/decennial-census/decade/2020/2020-census-results.html

Race and ethnicity distribution among UCB U.S. trial participants

compared with the U.S. 2020 CENSUS BUREAU

Phase 1 Phase 2 Phase 3 Filing

Topline results H1 2024

Topline results Q4 2024

rozanolixizumab

(FcRn inhibitor)

MOG-antibody disease

Stereotypical prolonged seizures

bepranemab (anti-tau antibody)

Alzheimer’s disease

UCB9741

Atopic dermatitis

UCB0599

(α-syn-misfolding inhibitor)

Parkinson’s disease

Topline results H1 2024

Topline results H2 2024

doxecitine/doxribtimine

(MT1621, nucleoside therapy)

TK2 deficiency disorder

Starting submissions in H1 2024

dapirolizumab pegol

(anti-CD40L antibody)

Systemic lupus erythematosus

Topline results H1 2024

Topline results H2 2024

Autoimmune encephalitis

Severe fibromyalgia syndrome

fenﬂuramine

(5-HT agonist)

CDKL5 deficiency disorder

Topline results Q4 2024

Phase 1b

UCB1381

Atopic dermatitis

Phase 1b

STACCATO

alprazolam

(benzodiazepine)

1 In partnership with Biogen

2 In partnership with Roche/Genentech

3 In partnership with Novartis

Our pipeline

Through 2022, we successfully completed key studies, initiated regulatory

filings and added new clinical development projects to our pipeline:

UCB | Integrated Annual Report 2022

At UCB, delivering reliable and

safe drugs to the patients we

serve is critical to our success.

Disease areas and solutions for

people living with severe diseases

In 2022, we continued delivering solutions that transform the

lives of people living with severe diseases across neurology,

immunology, and other areas where our expertise, innovation

and ambition align with unmet needs.

LEARN MORE

IMMUNOLOGYNEUROLOGY

Alzheimer's disease

Autoimmune

encephalitis

CDKL5

deficiency disorder

Dravet syndrome

Epilepsy

Generalized

myasthenia gravis

Lenno

x-Gastaut

syndrome

Myelin

oligodendrocyte

glycoprotein (MOG)

antibody disease

Parkinson's disease

Severe

fibromyalgia

syndrome

Thymidine kinase

2 deficiency (TK2d)

topic dermatitis

Axial spondyloarthritis

Crohn's disease

Hidradenitis

suppurativa

Non-radiographic

Axial Spondyloarthritis

Osteoporosis

Plaque psoriasis

Psoria

tic arthritis

Rheumatoid arthritis

Systemic lupus

erythematosus

Disease

areas

UCB | Integrated Annual Report 2022

Epilepsy and Rare Epilepsy Syndromes

UCB is furthering a strong heritage of transforming epilepsy

care and treatment with an additional focus on rare forms

of epilepsy, such as Dravet syndrome and Lennox-Gastaut

syndrome (LGS). Our portfolio for symptom management

includes KEPPRA

**, FINTEPLA

**, VIMPAT

**, BRIVIACT

(brivaracetam) and NAYZILAM

** (midazolam nasal spray -

U.S. only)

1,2

Our leading work continues, as many unmet needs remain.

In the short term we are investigating a novel rescue

medication that may lead to rapid epileptic seizure termination

(STACCATO

alprazolam

††

)

, as well as exploring fenfluramine

treatment of seizures associated with CDKL5 deficiency

disorder, a rare developmental and epileptic encephalopathy.

Longer term, powered by a team of dedicated scientists

and experts in epilepsy care, we hope to develop solutions

that move from symptomatic relief to addressing underlying

causes of certain epilepsies.

LEARN MORE

** Prescribing information varies depending on regulatory approval in each country.

†† This is an investigational drug product and its safety and efficacy has not yet been established. It has not been approved for any use by any authority in the world.

1 U.S. Food & Drug Administration. Available at: https://www.accessdata.fda.gov/scripts/cder/daf/. Last Accessed: January 2023.

2 European Medicines Agency. Available at: https://www.ema.europa.eu/en. Last Accessed: January 2023.

3 Clinicaltrials.gov. A Study to Test the Efficacy and Safety of STACCATO Alprazolam in Study Participants 12 Years of Age and Older With Stereotypical Prolonged Seizures.

Available at: https://clinicaltrials.gov/ct2/show/NCT05077904. Last Accessed 30 Jan 2023.

4 For patients 2 years to 18 years of age with CDKL5 Deficiency Disorder (CDD) and uncontrolled seizures. Clinicaltrials.gov. Fenfluramine in CDKL5 Deficiency Disorder (CDD).

Available at: https://clinicaltrials.gov/ct2/show/NCT03861871. Last Accessed 30 Jan 2023.

To complement our in-house research efforts, in 2022

we invested in collaborations with GliaPharm and Praxis

Precision Medicines.

These investments in early research aim to develop treatments

that could one day even be disease modifying and lead to a

cure for severe rare epilepsies. This was accelerated by our

acquisition of Zogenix, Inc. in March 2022. FINTEPLA

** was

approved in the EU and the U.S. and later in Japan

for treatment

of seizures associated with Dravet syndrome in patients two

years of age and older. FINTEPLA

** also received U.S. FDA

approval

for treatment of seizures associated with LGS in

patients two years of age and older in March 2022, followed by

approval in January 2023. To date, over 1 000 patients have

been treated with FINTEPLA

**, underpinning our commitment

to helping people living with rare forms of epilepsy to manage

their condition.

We are also advancing technology support solutions across

the patient journey – from diagnostics and treatment to

coordination of care – through investments in detection and

monitoring devices like those developed by Neurava, Nextsense,

Eysz and Byteflies.

2022 Performance

patients with

epilepsy reached

epilepsy product

sales in 2022

€ 2 532 M

** Prescribing information varies depending on regulatory approval in each country.

1 Pharmaceuticals and Medical Devices Agency. Available at: https://www.pmda.go.jp/PmdaSearch/iyakuDetail/

ResultDataSetPDF/820110_1139016S1020_1_01. Last Accessed: January 2023.

2 U.S. Food and Drug Administration. Available at: https://www.accessdata.fda.gov/drugsatfda_docs/label/2020/212102s000lbl.pdf.

Last Accessed: January 2023.

3 SmPC EU. Available at: https://www.ema.europa.eu/en/documents/product-information/fintepla-epar-product-information_en.pdf.

Last Accessed: February 2023.

>2.6

million

UCB | Integrated Annual Report 2022

UCB epilepsy leadership

Epilepsy investments and partnerships

Interventional Studies

Solutions on the market

>250

>25 000 patients enrolled

UCB is furthering a strong heritage of

transforming epilepsy care and treatment with

additional focus on rare forms of epilepsy,

such as Dravet syndrome and LGS

Generalized Myasthenia Gravis (gMG)

With rozanolixizumab

††1

and zilucoplan

††2

, we are poised to bring

differentiated value for adults living with generalized myasthenia

gravis

(gMG). We pursue management of gMG with both an

FcRN and C5 inhibitor option – which will allow neuromuscular

specialists more options to evaluate the optimal treatment

approach for individual patients.

Data from Phase 3 studies reinforced the evidence for

investigational treatments rozanolixizumab

††4

and zilucoplan

††5

in improving MG-specific outcomes – especially meaningful for

people who often experience a high treatment burden on top of

the debilitating impact of the disease.

UCB filings for zilucoplan

††

to treat gMG in adult patients who

are acetylcholine receptor antibody positive (AChR-Ab+)

were accepted by the EMA in October 2022 and the FDA in

December 2022

. Additionally, rozanolixizumab

††

was granted

FDA Priority Review designation in January 2023 for treatment

of adults with gMG who are anti-acetylcholine receptor (AChR)

or anti-muscle-specific tyrosine kinase (MuSK) antibody positive.

The EMA validated the Marketing Authorization Application

in December 2022 for rozanolixizumab

††

for the treatment

of adults with AChR or MuSK antibody positive gMG who

require treatment in addition to steroids or non-steroidal

immunosuppressants

Hidradenitis Suppurativa

As an under-diagnosed and under-served inflammatory skin

disease

, UCB is committed to advancing, understanding and

addressing unmet needs for people living with Hidradenitis

Suppurativa (HS).

In December 2022, UCB announced positive top-line results

from two Phase 3 studies, BE HEARD I

and BE HEARD II

evaluating the efficacy and safety of bimekizumab

†

in adults

with moderate to severe HS. These results will form the basis of

global regulatory license applications for bimekizumab

†

in HS

starting in 2023.

LEARN MORE

† bimekizumab is an investigational drug product that has not been approved for any use by any authority in the world for PsA, axSpA and HS.

†† This is an investigational drug product and its safety and efficacy has not yet been established. It has not been approved for any use by any authority in the world.

1 Being reviewed for the treatment of adults with generalized myasthenia gravis (gMG) who are anti-acetylcholine receptor (AChR) or anti-muscle-specific tyrosine kinase (MuSK)

antibody positive.

2 Being reviewed for the treatment of generalized myasthenia gravis (gMG) in adult patients who are acetylcholine receptor antibody positive (AChR-Ab+).

3 Koneczny I, Herbst R. Myasthenia Gravis: Pathogenic Effects of Autoantibodies on Neuromuscular Architecture. Cells. 2019;8(7):671.

4 ClinicalTrials.gov. A Study to Test Efficacy and Safety of Rozanolixizumab in Adult Patients With Generalized Myasthenia Gravis. Available at: https://clinicaltrials.gov/ct2/show/

NCT03971422. Last Accessed: January 2023.

5 ClinicalTrials.gov. Safety, Tolerability, and Efficacy of Zilucoplan in Subjects With Generalized Myasthenia Gravis (RAISE). Available at: https://clinicaltrials.gov/ct2/show/NCT04115293.

Last Accessed: January 2023.

6 UCB.com. UCB announces U.S. FDA acceptance of new drug application and EMA MAA validation for zilucoplan for the treatment of generalized myasthenia gravis in adult patients.

Available at: https://www.ucb.com/stories-media/Press-Releases/article/UCB-announces-US-FDA-acceptance-of-new-drug-application-and-EMA-MAA-validation-for-zilucoplan-for-the-

treatment-of-generalized-myasthenia-gravis-in-adult-patients. Last Accessed: January 2023.

7 UCB.com. UCB announces rozanolixizumab BLA for the treatment of generalized myasthenia gravis filed with U.S. FDA and designated for Priority Review. Available at: https://www.ucb.

com/stories-media/Press-Releases/article/UCB-announces-rozanolixizumab-BLA-for-the-treatment-of-generalized-myasthenia-gravis-filed-with-US-FDA-and-designated-for-Priority-

Review. Last Accessed: January 2023.

8 Kokolakis G, Wolk K, Schneider-Burrus S, et al. Delayed Diagnosis of Hidradenitis Suppurativa and Its Effect on Patients and Healthcare System. Dermatology. 2020;236:421-430. doi:

10.1159/000508787. Last Accessed: January 2023

9 ClinicalTrials.gov. A Study to Evaluate the Efficacy and Safety of Bimekizumab in Study Participants With Moderate to Severe Hidradenitis Suppurativa.

Available at: https://clinicaltrials.gov/ct2/show/NCT04242446. Last Accessed: January 2023

10 ClinicalTrials.gov. A Study to Evaluate the Efficacy and Safety of Bimekizumab in Study Participants With Moderate to Severe Hidradenitis Suppurativa.

Available at: https://clinicaltrials.gov/ct2/show/NCT04242498. Last Accessed: January 2023

In December 2022, UCB

announced positive top-line

results from two Phase 3

studies, BE HEARD I

and

BE HEARD II

, evaluating

the efficacy and safety of

bimekizumab

†

in adults with

moderate to severe HS.

UCB | Integrated Annual Report 2022

UCB is committed to advancing understanding and

addressing unmet needs for people living with Hidradenitis

suppurativa (HS) – including increased awareness and

understanding of HS across treatment specialities.

Psoriasis

In line with our commitment to offer new treatment options,

BIMZELX

* is the world’s first and only selective IL-17A and

IL-17F inhibitor

(two key cytokines driving inflammation) to

gain regulatory approval for the treatment of moderate to

severe plaque psoriasis. Results from the Phase 3/3b clinical trial

program demonstrated fast, deep and durable skin clearance

for adults living with plaque psoriasis. Patients treated with

bimekizumab in these studies achieved superior levels of skin

clearance compared to those who received adalimumab

ustekinumab

, and secukinumab

, and the safety was consistent

with previous phase 3 studies.

LEARN MORE

Following first approvals of BIMZELX

* in the EU/EEA

and Great

Britain

in 2021, in January 2022 BIMZELX

* received marketing

authorization in Japan

for the treatment of plaque psoriasis,

generalized pustular psoriasis and psoriatic erythroderma

in patients who are not sufficiently responding to existing

treatments. In February and March 2022, BIMZELX

* received

marketing authorization in Canada

and Australia

respectively,

for the treatment of moderate to severe plaque psoriasis in adults

who are candidates for systemic therapy or phototherapy. In

July 2022, October 2022 and January 2023, BIMZELX

* received

marketing authorization in Saudi Arabia

, Switzerland

and

United Arab Emirates

, respectively, for treatment of moderate

to severe plaque psoriasis in adults who are candidates for

systemic therapy.

Great Britain

August 2021

Switzerland

October 2022

E.U.

August 2021

Japan

January 2022

Australia

March 2022

Canada

February 2022

Saudi Arabia

July 2022

U.A.E

January 2023

BIMZELX

* is now approved for psoriasis by eight regulatory authorities worldwide

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

† bimekizumab is an investigational drug product that has not been approved for any use by any authority in the world for PsA, axSpA and HS.

1 Glatt S, Helmer E, Haier B, et al. First-in-human randomized study of bimekizumab, a humanized monoclonal antibody and selective dual inhibitor of IL-17A and IL-17F, in mild psoriasis.

Br J Clin Pharmacol. 2017;83(5):991–1001. BIMZELX

(bimekizumab) EU Summary of Product Characteristics, May 2022.

https://www.ema.europa.eu/en/documents/product-information/bimzelx-epar-product-information_en.pdf. Last Accessed: December 2022.

2 Warren R, et al. Bimekizumab versus Adalimumab in Plaque Psoriasis. N Engl J Med. 2021; 385:130 –141;.

3 Reich K, et al. Bimekizumab versus ustekinumab for the treatment of moderate to severe plaque psoriasis (BE VIVID): efficacy and safety from a 52-week, multicentre, double-blind,

active comparator and placebo controlled phase 3 trial. Lancet. 2021;397:487–498.

4 Reich K, et al. Bimekizumab versus Secukinumab in Plaque Psoriasis.N Engl J Med. 2021;385:142 – 152;.

5 Gordon KB, et al. Bimekizumab efficacy and safety in moderate to severe plaque psoriasis (BE READY): a multicentre, double-blind, placebo-controlled, randomised withdrawal phase 3

trial. Lancet. 2021; 397: 475 – 486.

6 EMA. BIMZELX, INN-bimekizumab. Available at: https://www.ema.europa.eu/en/documents/product-information/bimzelx-epar-product-information_en.pdf.

Last Accessed: January 2023

7 MHRA. Public Assessment Report. Available at: https://mhraproducts4853.blob.core.windows.net/docs/3de2d36b83f2bb324ea40ceef4d062dc1fdbb0d8. Last Accessed: January 2023

UCB | Integrated Annual Report 2022

2022 Performance

Patients treated

with BIMZELX

since 2021 launch

BIMZELX

sales in 2022

€ 35 M

>4 000

8 Pharmaceuticals and Medical Devices Agency. New Drugs Approved in FY 2021. https://www.pmda.go.jp/files/000246734.pdf. Last Accessed: December 2022

9 Canada SmPC. Available at: https://pdf.hres.ca/dpd_pm/00064702.PDF. Last Accessed: February 2023.

10 Australia SmPC. Available at: https://www.tga.gov.au/resources/auspmd/bimzelx. Last Accessed: February 2023.

11 Saudi Arabia SmPC. Available at: https://www.sfda.gov.sa/en/drugs-list. Last Accessed: February 2023.

12 Switzerland SmPC. Available at: https://www.swissmedic.ch/swissmedic/de/home/humanarzneimittel/authorisations/new-medicines/bimzelx-injlsg-fertigspritze-bimekizumabum.html.

Last Accessed: February 2023

13 United Arab Emirates Ministry of Health & Prevention.

14 Update on U.S. FDA Review of Biologics License Application (BLA) for bimekizumab. Available at: https://www.ucb.com/stories-media/Press-Releases/article/Update-on-US-FDA-Review-

of-Biologics-License-Application-BLA-for-bimekizumab-0. Last Accessed: February 2023.

In December 2022, UCB confirmed the U.S. FDA accepted

for review the Biologics License Application resubmission for

bimekizumab for treatment of moderate to severe plaque

psoriasis. The resubmission was designated as ‘Class 2’, with a

six-month review period, and the FDA action is expected in the

second quarter of 2023. The resubmission follows the receipt

of a Complete Response Letter from the FDA in May 2022

(not due to efficacy or safety). We look forward to bringing

bimekizumab to people living with psoriasis in the U.S. as soon

as possible.

While BIMZELX

* is not approved in the U.S., we continue to

support adults with moderate to severe plaque psoriasis who

are candidates for systemic therapy or phototherapy with

CIMZIA

** (certolizumab pegol), which has reached over

1 million patient-years since launch, achieving its guided peak

sales target of € 2 billion ahead of time.

Spondyloarthritides

Spondyloarthritides (SpA) is a family of inflammatory

rheumatic diseases. Two of the most common and

severe forms are Psoriatic Arthritis (PsA), which typically

affects people who already have psoriasis

, and Axial

Spondyloarthritis (axSpA)

CIMZIA

** is available to patients with spondyloarthritides

across 44 countries and has expanded into six indications

including PsA, ankylosing spondylitis (AS), also known as

radiographic axial spondyloarthritis (r-axSpA), and non-

radiographic axial spondyloarthritis (nr-axSpA). In 2022,

180 000 patients were treated by CIMZIA

**.

In September 2022, the European Medicines Agency

accepted marketing authorization applications for

bimekizumab

†4

in the treatment of adults with active psoriatic

arthritis and active axial spondyloarthritis

. We look forward to

bringing bimekizumab

†

to people living with these conditions

in EU countries and beyond as soon as possible, including

submission to regulatory authorities in the U.S. following

approval of the Biologics License Application (BLA)

for

bimekizumab in psoriasis.

We continue striving to address unmet needs and provide

disease control from an early stage for patients with SpA,

including axSpA where average diagnosis takes 9 years

In November 2022, we signed a research collaboration

agreement with EUROSpA, Europe’s largest research network,

to collect data from people living with axial spondyloarthritis

in 16 countries. This data will help us understand the impact

of axSpA on patients, and better target their needs.

LEARN MORE

** Prescribing information varies depending on regulatory approval in each country.

† bimekizumab is an investigational drug product that has not been approved for any use by any authority in the world for PsA, axSpA and HS.

1 Mease PJ, Armstrong AW. Managing patients with psoriatic disease: the diagnosis and pharmacologic treatment of psoriatic arthritis in patients with psoriasis. Drugs.

2014;(74):423-41

2 Sieper J, Braun J. Clinician’s Manual on Axial Spondyloarthritis. Springer Healthcare 2014

3 CIMZIA

is indicated to treat the following conditions in US: Moderate to Severe Plaque Psoriasis, Moderate to Severe Crohn’s Diseases, Active Psoriatic Arthritis, Active Non-

radiographic Axial Spondyloarthritis, Moderate to Severe Rheumatoid Arthritis, Active Ankylosing Spondylitis.

4 In the US, bimekizumab is being reviewed for the treatment of adults with moderate to severe plaque psoriasis. In the EU, bimekizumab is being reviewed for the treatment of adult

patients with active psoriatic arthritis (PsA), and adult patients with active axial spondyloarthritis (axSpA).

5 UCB.com. European Medicine Agency Accepts Marketing Authorization Applications for Bimekizumab in Psoriatic Arthritis and Axial Spondyloarthritis. Available at: https://www.

ucb.com/stories-media/Press-Releases/article/European-Medicine-Agency-Accepts-Marketing-Authorization-Applications-for-Bimekizumab-in-Psoriatic-Arthritis-and-Axial-

Spondyloarthritis. Accessed: January 2023.

6 UCB.com. UCB Announces FDA Acceptance of BLA Resubmission for Bimekizumab. Available at: https://www.ucb.com/stories-media/Press-Releases/article/UCB-Announces-

FDA-Acceptance-of-BLA-Resubmission-for-Bimekizumab. Last Accessed: February 2023.

7 Jovani V, et al. Challenges to conquer from the gender perspective in medicine: The case of spondyloarthritis. PLoS One. 2018;13(10):e0205751.

UCB | Integrated Annual Report 2022

With CIMZIA

** – approved for six different indications

– we were the first pharmaceutical company to conduct

research on chronic inflammatory disease treatment during

pregnancy and breastfeeding. The additional evidence

generated to help women and healthcare providers make

more informed choices was welcomed by the medical

community, prompting UCB to place an emphasis on this

patient group across all UCB solutions.

CIMZIA

** is available to patients in 44 countries, including 8

low- and middle-income countries. In 2022, 180 000 patients

were treated by CIMZIA

** worldwide.

From an environmental perspective, CIMZIA

**-related CO₂e

emissions have been reduced by around 18% by focusing on

reducing raw manufacturing materials, deploying energy and

water efficiency projects in manufacturing, and redesigning its

secondary packaging. We plan to distribute CIMZIA

** by sea

freight, cutting its carbon footprint by an estimated 30%, while

exploring how optimized cleaning and water purification

procedures could reduce water consumption.

In Brazil, CIMZIA

** has shown impressive reach, where in

2022, we estimate that around 17 200 people (+16% vs. 2021)

were treated with CIMZIA

** – 77% through public healthcare.

This increase is attributed to a holistic approach of patient

needs together with their healthcare practitioners, including:

• Medical education, from diagnostic to treatment

• Appropriate support for patients and healthcare

professionals in optimizing reimbursement processes

• Implementation of patient support programs

• Affordability optimization in public and private sectors.

Integrating UCB’s sustainable approach with CIMZIA

**:

strengthening patient reach and reducing environmental impact

Spotlight:

8 CIMZIA

is indicated to treat the following conditions in US: Moderate to Severe Plaque Psoriasis, Moderate to Severe Crohn’s Diseases, Active Psoriatic Arthritis, Active

Non-radiographic Axial Spondyloarthritis, Moderate to Severe Rheumatoid Arthritis, Active Ankylosing Spondylitis. Exact indications can vary from country to country.

UCB has continued to bring

EVENITY®** to people living with

osteoporosis with growing impact

UCB | Integrated Annual Report 2022

Osteoporosis

UCB’s treatment for osteoporosis is EVENITY

(romosozumab)

a bone forming monoclonal antibody, co-developed and co-

commercialized by UCB and Amgen.

Following its first launch in 2019, UCB has continued to bring

EVENITY

** to people living with osteoporosis with a growing

impact, reaching, together with our partners, 400 000 people

living with osteoporosis at high risk of fracture around the globe.

In 2022, UCB secured reimbursement for EVENITY

** in England

and Wales, Finland, Greece, Italy, Norway, Spain and Switzerland.

UCB is committed to closing the care gap for all post-fracture

patients by working with hospitals and institutions that identify,

treat and monitor patients to prevent future fractures. We work to

address policy and reimbursement issues, helping policymakers

to implement policies that reduce the burden of fragility

fractures and demonstrate how coordinated post-fracture care

benefits all. For instance, in Japan, UCB partnered with societies,

policymakers and external experts to gain support from the

government to reimburse fracture liaison services., transforming

post-fracture care and improving secondary prevention of fragility

fractures to ensure people living with osteoporosis can have the

lives they want.

LEARN MORE

2022 Performance

Fracture liaison

service programs

in place

Patients with osteoporosis

treated (since launch)

EVENITY

sales in 2022

€ 25 M

814

>400 000

** Prescribing information varies depending on regulatory approval in each country.

1 Romosozumab is indicated for the treatment of osteoporosis in post-menopausal women at high risk of fractures. UCB and Amgen co-developed romosozumab, with

distribution in Europe being led by UCB, in Japan by Astellas Pharma, and in the U.S. by Amgen.

2 Number of FLS mapped by the International Osteoporosis Foundation Capture the Fracture Map of Best Practice since launch in 2013 by February 10th, 2023.

We work to address policy and reimbursement issues,

helping policymakers to implement policies that reduce the

burden of fragility fractures and demonstrate how coordinated

post-fracture care benefits all

Women should never have to choose between managing their

health and starting or expanding their family, but many are

confronted with confusing and contradictory communication

about possible risks.

Advancing science for women of

childbearing age across diseases

Autoimmune diseases and chronic neurological diseases, such as

rheumatoid arthritis

and epilepsy

, often manifest in early adulthood,

overlapping with peak reproductive years for women.

LEARN MORE

Combined with later pregnancies and higher prevalence

of chronic conditions, more and more women need

medications to treat their disease while planning to conceive,

being pregnant or breastfeeding.

Women should never have to choose between managing

their health and starting or expanding their family, but

many are confronted with confusing and contradictory

communication about possible risks. Fear about using

therapeutics that might harm the fetus or newborn mean

women and healthcare providers often feel they must

compromise on optimal disease management before, during

and after pregnancy. There is a clinical and ethical imperative

to generate better standardized data to inform decision-

making on the use of medicines during pregnancy and

breastfeeding.

We want to empower women living with severe diseases to

make informed decisions with their healthcare provider during

childbearing years. This includes pregnancy planning and care

management, during and after pregnancy, to enable optimal

health outcomes for mother and baby.

Our commitment to addressing knowledge gaps in the care

of women of childbearing age began with CIMZIA

**, and we

are now embedding an emphasis on women of childbearing

age across all UCB’s current and future solutions through a

‘listen, ask, act’ approach. We are assessing specific unmet

needs in our therapeutic areas and designing relevant data

generation plans to respond to these needs. Additionally, we

work closely with external partners such as the ConcePTION

consortium and CAMT – Coalition for Advanced Maternal

Therapeutics on research specific to pregnant and lactating

women. We co-lead a working group of the ICH

initiative

to standardize inclusion of pregnant and breastfeeding

individuals in clinical studies, and convene and co-chair the

BRIDGE

Global Commission of multi-disciplinary experts and

patient representatives to establish implementable solutions

and sustainably address information gaps before, during, and

after pregnancy for women with chronic diseases.

We believe there is a clear opportunity for UCB to be an

industry leader by innovating in data generation and inspiring

others to improve quality of care.

** Prescribing information varies depending on regulatory approval in each country.

1 Andreoli L et al. The Course of Rheumatic Diseases During PregnancyIMAJ. 2019;21:464–470.

2 Herzog AG et al. Does the age of seizure onset relate to menarche and does it matter? Seizure: European Journal of Epilepsy. 2019;69:1–6.

3 International Council for Harmonisation of Technical Requirements for Pharmaceuticals for Human Use

4 Better Research, Information and Data Generation for Empowerment of WoCBA

UCB | Integrated Annual Report 2022

Safety

Oversight and understanding of the safety profiles for all

our medicines, including those in clinical development, is

ensured by the Global Patient Safety organization. A safety

lead is assigned to each product to manage a cross-

functional benefit risk team during its full life cycle.

Through ongoing review of all available data, the benefit risk

team identifies any potential emerging safety signals, and

assesses whether they pose a safety risk. All potential risks are

considered to determine whether they impact the benefit

risk assessment and if further risk management actions

are required. These measures could include additional

safety actions in a study protocol, communications with

patients, prescribers and regulators, or adapting how a

product is used.

Ensuring product

safety and quality

At UCB, offering impactful medicines to the patients we serve is

critical to our success. Our Global Patient Safety and Quality activities,

processes and governance safeguard this commitment.

2022 Performance

compliance with safety

reporting obligation

training (target 90%)

critical or repeat

findings during safety

inspections

99%

Submission of individual

case safety reports to health

authorities was maintained

at an acceptable rate

throughout the year

UCB | Integrated Annual Report 2022

This year, we celebrate the tenth anniversary of the

Benefit Risk Board (BRB). This governance body, chaired

by the Chief Medical Officer, monitors and advises

on product benefit-risk across UCB’s portfolio of

development and approved products, independently of

commercial plans.

The BRB has evolved through its existence with culture

and operational processes that optimize informed, data-

driven decision making, and recently welcomed patient

experts – including their insights and perspectives

to make better-informed decisions on benefit risk

throughout a product’s life cycle.

10 years of making

informed clinical decisions:

Benefit Risk Board

Spotlight:

Quality

We ensure quality for our products and solutions, as well

as our operations. Our future growth relies on the trust

stakeholders place in our products, and our ability to

provide them on time, every time.

Digital tools are interwoven into all areas of good

working practices which are heavily regulated by

international health authorities in terms of:

• Building and refining quality management systems

• Conducting risk-based audits and assessments of

UCB and third parties to ensure data integrity

• Taking action if and when needed

, where any

quality issues with potential to impact patients arise

which may result in health authorities’ notification or

product recall.

2022 Performance

2 class II voluntary recalls

1 class III voluntary recall

0 critical recalls

Form 483s: # 1 UCB Braine (Belgium)

Warning letters: 0

Seizures: 0

Consent decrees: 0

UCB received a Complete Response

Letter (CRL) by the U.S. FDA

which led

to a delay in the approval of BIMZELX

in the US and an inspection by CFDI

led to a product recall and importation

ban for one product in China.

Recalls

Inspections

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

1 The actions taken in case of Quality issues are codified in our Quality management system, policies and procedures.

2 A critical recall is a recall at the patient level - class 1 and/or with significant Market impact and/or on Company reputation

3 UCB.com. Update on U.S. FDA Review of Biologics License Application (BLA) for bimekizumab. Available at: https://www.ucb.com/stories-media/Press-Releases/article/Update-on-US-

FDA-Review-of-Biologics-License-Application-BLA-for-bimekizumab-0. Last Accessed: February 2023.

UCB | Integrated Annual Report 2022

The need for data integrity compliance is greater than ever,

as collection of large data sets increases in line with a rise

in digital data collection.

In 2022, UCB took part in the IQ Consortium Data

Integrity Working Group on data management and control

alongside several other large pharmaceutical companies.

Representatives defined a practical risk-based approach to

audit trail review, to uphold a high level of data integrity in

line with global regulatory requirements.

UCB is steadfast in our commitment to deliver effective

medical solutions to the patients we serve, partnering on

these initiatives to advance innovation and quality in the

biopharmaceutical industry.

Data Integrity

Spotlight:

LEARN MORE

Fighting counterfeit drugs

To mitigate risk of counterfeit drugs and maintain traceability

throughout the supply chain, UCB’s process control structure

comprises all relevant regulations, such as the Falsified Medicine

Directive (EU) and Good Distribution Practice (U.S.) requirements

regarding customer qualification including customer assessment

and approval. Advanced Track & Trace for Pharmaceuticals

(ATTP) technology allows us to enforce serialization traceability

requirements.

UCB has a documented Supply Chain Security process on

which relevant stakeholders are trained. The process includes

documentation of security events, their investigation and

notification to appropriate authorities, and internal reporting

within UCB to notify, quantify and instil improvement actions if

required. The Supply Chain Security Council periodically reviews

the number of events and instances disclosed in the Supply

Chain Security report. UCB noticed a decline of events in 2022

compared with previous years. For those events disclosed in

2022, UCB concluded it was not necessary to take direct legal

action as a result of the reported events; based on assessment

of their nature and scope. UCB did not receive feedback in

2022 from the health authorities as to which event required

further law enforcement actions to be undertaken by the

respective agencies.

Barriers to appropriate care may materialize at many points

on the patient journey – from diagnosis to decisions on

optimal care, treatment affordability and availability. Each

barrier negatively impacts a person’s long-term health

outcomes, but one of the most prominent is whether patients

can afford to use the treatment option they need.

Patient affordability, and hence, access, is strongly linked to

coverage and reimbursement decisions of third-party payers.

Diversity of demographics, economies, healthcare systems,

health policies and funding approaches result in considerable

differences in healthcare spending.

Providing access to our solutions

Our ambition is that by 2030, all people who need our medicines in

countries where we operate have access to them in a manner that is viable

for society, our investors and UCB. In addition, we aim to improve access to

quality care and medicines for people with epilepsy in low- and

middle-income geographies around the globe.

A payer’s ability and willingness to permit use of a medicine

(“coverage”) and finance the cost of care (“reimbursement”) is

a localized decision within a country or sub-national region.

Many payers around the world remain focused on containing

healthcare costs, especially after recent macroeconomic

threats resulting from the COVID-19 pandemic and rising

inflation. As a result, payers continue to increase their demand

for higher standards of evidence to demonstrate differentiation

and the value of medicines as conditions for coverage and

reimbursement. Insufficient evidence of value results in greater

downward pressure on price and/or restrictions on access

based on strict conditions of use.

Globally these localized payer frameworks used to assess value

contribute to inequities in access for patients and require us

to consider customized approaches to address patient needs;

as UCB believes people who need our medicines should

have access to them without undue burdens of defending

their need, waiting for care, or being unable to afford the

medicine they need.

By working closely with healthcare systems, payers and

partners, we can contribute to improve access to our solutions

and maximize their impact for patients and society.

UCB’s definition of access (n.): A patient’s

ability to obtain, in a timely fashion and without

undue burden, the medicine they need.

• Integrating access

strategies from

innovation to launch

• Partnering with

policymakers,

patients, and other

stakeholders to

reinforce value-based

assessments which

support sustainable

and equitable patient

access to care

• Pricing our medicines

according to the value

they bring to patients

and society

• Measuring access

in countries

where we operate

• Offering managed access

programs as well as patient

assistance programs and

developing health equity

research while working

towards long-term and

sustainable solutions

• A social business

approach to

improve the situation

of people living

with epilepsy on a

sustainable basis

• Developing a

Sustainable Access

Framework to

expand access

across geographies

Our

approach

UCB | Integrated Annual Report 2022

We aim to improve access to

quality care and medicines for people

with epilepsy in low- and middle-income

geographies around the globe.

Integrating access strategies from

innovation to launch

Our commitment to develop and bring to market innovations

that deliver unique outcomes is a significant factor in how

we enable access. Understanding how people access our

medicines and how health authorities assess value begins early

in development. Responding to regulatory, payer, provider,

and patient perspectives on unmet need and the value of new

interventions is integral, and all drug candidate development

strategies address key drivers of value, to facilitate future

coverage, reimbursement, and price decisions.

Supporting Value-based Assessments

Healthcare systems across the globe continue to navigate the

challenges of providing optimal care amid budgetary constraints

and increasing prevalence of chronic diseases. UCB supports

a competitive, value-based system that improves sustainable,

affordable, and equitable access. As healthcare systems evolve,

systematic value assessments are increasingly conducted to

help payers understand the effectiveness, benefits and risks,

and costs associated with any medicine. Their assessment

methodology drives reimbursement decisions and may lead to

restrictions on access or usage of a medicine. We continued

to use our Value Assessment Principles, launched in 2021, to

shape our engagement, with our U.S. Voices on Value series

connecting diverse stakeholders on topics like value-based

contracts, sustainability, health equity and transparency.

Our position on value-based pricing

We aim to help patients live longer and healthier lives and

to bring value to society in the form of efficient healthcare

spending and greater productivity through adoption and use

of our medicines. Our prices reflect the benefits our medicines

bring to patients and society, with the expectation that people

have access to medicines they need without undue burden of

restrictions or personal affordability.

Access to healthcare remains a significant obstacle for many

due to structural, demographic, and economic differences

between health systems. Because of these systemic inequities,

UCB balances pressure to achieve and maintain acceptable

coverage and reimbursement of our products with a tailored

approach to pricing medicines, including tiered pricing which

reflects a country’s ability to pay for a medicine. Our approaches

reflect disproportionate disease burdens, healthcare structures,

and affordability differences which exist within health systems.

We are also connecting our prices to value-based agreements

with the healthcare system that use realized benefits to the

patient, health system, and society to determine medicine

prices in clinical practice. These collaborative agreements focus

on common goals pertaining to value and outcomes, which

sometimes require system-level changes based on real-world

evidence to scale more broadly.

Our Executive Committee regularly reviews our approach to

pricing, access, and affordability of our medicines to patients.

Our pricing and reimbursement approaches also adhere to local

laws and regulations.

UCB | Integrated Annual Report 2022

Measuring access in countries where we operate

Important access indicators reflect conditions in which payers

are willing to provide coverage, time taken to achieve that

coverage, and affordability burden for patients. In the adage of

providing rapid “high quality results” at an “affordable rate”, we

recognize the challenge of achieving all three. Nonetheless, as

we strive to expand access to our patent-protected solutions in

the countries where we operate, we measure our performance

against previous year baselines through our Access Coverage

Performance

and our newly-reported Time to Access Indices.

1. Access Coverage Performance Index: Tracks coverage and

reimbursement of UCB's medicines according to whether

access is reimbursed for all patients according to indicated use

by regulators, reimbursed for some patients, or not available at

present (‘no reimbursement’ – whether a decision is pending,

rejected or not planned).

2. Time to Access Index: Tracks time between marketing

authorization and payers’ decision to provide coverage and

reimbursement for new UCB medicines – measured against

an IQVIA industry benchmark in individual markets where

UCB operates

As disclosed in our previous Integrated Annual Report, a new

Access Coverage Performance Index baseline set in early

2022 includes an additional 18 countries (totaling 32 countries

assessed

), two further products (BIMZELX

* and NAYZILAM

**)

and any new indications which receive regulatory approval in

the timeframe. All products that have lost their patent protection

are removed. This new baseline showed that we achieved 30%

unrestricted access and 38% restricted access at the start of the

year and is the basis to assess our performance in 2022

In 2022, we gained coverage for new patients with the

reimbursement of BIMZELX

* for adults with moderate to

severe plaque psoriasis in 8 countries, and doubled coverage

of EVENITY

** compared to the baseline for post-menopausal

women with severe osteoporosis and at high risk of fracture. We

also achieved a rapid time-to-access for pediatric 2-4 year old

children with epilepsy in all coverage decisions for BRIVIACT

**.

At the same time, UCB’s in-market and patent-protected

products sustained or improved access for patients – notably for

expanded access to CIMZIA

**.

The Access Coverage Performance Index baseline for 2023

includes 3 more countries (Mexico, Brazil and Luxembourg)

and 3 new products (FINTEPLA

**, already market authorized

in several countries, and zilucoplan

††

and rozanolixizumab

††

for

which we expect market authorization during the year).

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque

psoriasis in adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular

psoriasis and psoriatic erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

†† This is an investigational drug product and its safety and efficacy has not yet been established. It has not been approved for any use by any authority in the world.

1 Previously known as the Access Performance Index, this was renamed in 2022 to be more precise on our approach to measure the coverage of UCB medicines specifically,

as opposed to broader performance metrics.

2 Time to Access Index is measured against an industry benchmark prepared by IQVIA for UCB. This benchmark measures the median time (days) between market

authorization and reimbursement listing for a product, measured per country.

3 39 geographies and channels in total (US is split into five channels, Canada is split into public and private channels, UK is split into England, Wales and Scotland).

4 This period of assessment ran from the start of Q4 2021 through to the end of Q3 2022, and does not represent a calendar year.

2022 Performance

35%

42%

41%

23%

Reimbursement for

all patients

Reimbursement for

some patients

of positive reimbursement

decisions obtained earlier

than benchmark as per our

Time to Access Index

No Reimbursement

Going forward, the Access Coverage Performance Index

will measure reimbursement (without distinction between

reimbursement for all patients within the regulatory label

or reimbursement restricted to some patients) or no

reimbursement. Based on this new methodology, at the end of

Q3 2022 we had reached 55% reimbursement for patients, and

this becomes our new baseline entering 2023.

In the U.S., seeking solutions to

improve health equity is another

important aspect of how we ensure

those who need our medicines can

access them.

UCB | Integrated Annual Report 2022

UCB has ongoing patient assistance programs in place for

our products in the U.S., including patient assistance, co-pay

assistance, and free or discounted goods depending on

income level.

In the U.S., seeking solutions to improve health equity is

another important aspect of how we ensure those who need

our medicines can access them. In 2022, UCB completed

steps to build a new sustainable access pilot in Georgia, and

expanded work with patients in the Hispanic community

with a pilot on epilepsy care. By continuing to invest in

social research among diverse patient groups, we can better

understand the landscape and define targeted approaches to

improve health equity.

In March 2022, we released our first U.S. Sustainable Access

and Pricing Transparency Report – underscoring UCB’s

commitment and approach to an innovative, competitive,

and value-based system which keeps patients at the center.

A further U.S. Sustainable Access and Pricing Transparency

Report followed in February 2023, and is available in the annex.

In 2022, our U.S. net price change (after discounts and rebates)

averaged -3.3% across the U.S. product portfolio (list price

change averaged 6.3%). This reflects our significant market

rebates and discounts to ensure patients can access UCB

medicines. At a product level, the largest single percentage

change was a 6.9% list price increase and a 12%

net price

change from 2021 to 2022. This is a result of several external

factors including drug pricing program policy changes and the

impact of certain contract changes in our business.

Expanding access to

UCB medicines in the U.S.

We recognize that in healthcare systems like the U.S., different kinds of coverage

and patient out-of-pocket costs may create barriers to access, and we seek to find

solutions to remove those barriers for those who need our medicines.

LEARN MORE

2022 Performance

>300 000

95 583

patients accessed

UCB medicines in the U.S.

patients benefited from

UCB U.S. assistance programs

1 As part of UCB’s pricing principles, year-over-year net price increases generally do not increase more than the CPI-U, a metric that represents the

percent change over time of the price of specific goods and services in the U.S. Any increase in price is tied to the value UCB’s products bring

to patients, stakeholders, and society. Exceptional net price increases above CPI-U are linked to meaningful increase in patient or societal value.

CPI-U baseline is determined based on a combination of Bureau of Labor Statistics data and Federal Open Market Committee forecasts.

We also work with third-party distributors to broaden availability of

our solutions in countries where UCB is not present.

To reach our ambition to improve access to quality care and

medicines for people with epilepsy in low- and middle-income

geographies around the globe, 2022 brought the launch of a new

social business approach for underserved patients in Mumbai,

India in a way that aims to be financially self-sustaining over time.

Leveraging UCB’s innovation capabilities, this new approach

is rooted in expanding local partnerships, sourcing innovative

finance options, and providing patients with sustainable access to

the treatment they need. We collaborate with Boston University to

independently measure societal impact – with first data expected

in 2023. Going forward, we plan to scale our social business

model in India and in other geographies, complemented by our

philanthropic approach through UCB’s Innovation for Health

Equity Fund.

Expanding access in low- and

middle-income geographies

Out of the 36 countries where UCB is present, eight are

classified as low- and middle-income countries, where our

access initiatives follow the global framework.

2022 Performance

2 271

754

patients screened via health

camps (goal: 1600)

patients diagnosed with

epilepsy (goal: 800)

patients enrolled into Beyond

Epilepsy Access and Myths

programs (goal: 650+)

GPs trained

UCB | Integrated Annual Report 2022

Our first social business pilot was launched in 2022 in Mumbai

– an ever-expanding city of more than 20 million people

, an

estimated 144 000 of whom live with epilepsy

and where

persistent diagnostic and treatment gaps exist. Barriers to

appropriate care can range from low disease awareness and

stigma around epilepsy, to restricted capacity in the healthcare

systems, and to limited treatment availability and affordability.

The Beyond Epilepsy Access and Myths (BEAM) initiative, set to

serve as a social business model for improving epilepsy care

in underserved communities, began operations in April 2022

in Mumbai and has scaled activities to four operational

wards. Working in partnership with local organizations and

community-based healthcare practitioners, BEAM health

camps regularly take place close to where patients live. Camps

allow easier access to diagnosis tools, and enrolled patients can

benefit from tele-counseling services and home-delivery of

medicines as well as access to second generation anti-seizure

medications at a discounted price.

We plan to double activities in Mumbai through 2023 and

strengthen our work with community-based healthcare

organizations and associations, to carry out specific awareness

raising programs on epilepsy and offer additional training

programs for clinical management of epilepsy.

Mumbai social business pilot

Spotlight:

including

9 LMIC

countries

CIMZIA

including

10 LMIC

countries

KEPPRA

including

11 LMIC

countries

VIMPAT

including

7 LMIC

countries

BRIVIACT

including

6 LMIC

countries

NEUPRO

** Prescribing information varies depending on regulatory approval in each country.

1 Mumbai, India Population (2022) - Population Stat

2 Santhosh NS, Sinha S, Satishchandra P. Epilepsy: Indian perspective. Ann Indian Acad Neurol 2014;17(Suppl 1):S3-S11.

The framework is intended to remain relevant to UCB’s planning

and execution into the future and acknowledges where we are

today while guiding us to do more for people who need our

solutions, tomorrow. It integrates our commitment to reduce

access inequities by delivering on our purpose to create value

for patients now and into the future, while ensuring the financial

return expected by our shareholders.

The framework guides teams to shape the right business

approach towards attaining UCB’s sustainable access ambition,

with key questions like:

1. What are the current barriers which prevent patients from

accessing the care they need?

2. How does the existing health ecosystem infrastructure and

funding mechanisms impact feasibility of solutions?

3. Which business approaches are best suited to reduce barriers

and support access?

4. What business and social impact will we achieve?

Assessing how to move sustainable

access forward across countries

In 2022, UCB developed a Sustainable Access Framework to advance

understanding of barriers to access, health infrastructures and local funding.

The Framework guides

UCB teams to address key

questions which ultimately

will allow us to select the right

business approach towards

attaining UCB’s sustainable

access ambition.

UCB | Integrated Annual Report 2022

By identifying why barriers exist, we can assess potential

solutions that harmonize our own business and social

impact objectives with health system resources. This holistic

access approach across countries is expected to begin

implementation in 2023.

In general, barriers go beyond coverage and

reimbursement alone and include limitations in:

We know that pressure on healthcare costs and

pharmaceutical pricing continues to come under global

scrutiny which may impede our ability to deliver our

solutions to those who need them, in a way which is viable

and sustainable for society, our investors and UCB. Specific

access-related risks are reported in the Risk Management

section of this report.

Have the patient and their

healthcare provider diagnosed

the condition and made

treatment decisions based

on their awareness and

understanding of evidence-

based medicine and optimal

treatment pathways?

Based on the funding path

used, is the treatment option

affordable (e.g. reflected

in national health system

budgeting and reimbursement,

local clinic budgeting, patient

out-of-pocket costs, or via

alternative financing

methods)?

Is the trea

tment option (or

a reasonable substitute)

approved for use (e.g. marketing

authorization, covered by

a payer, or under a Health

Technology Assessment (HTA)

recommendation)?

Is the treatment option supplied

and physically available in

the patient’s local network?

This reflects challenges to

distribution, cold-chain logistics,

and pharmacy stocking.

Of particular interest is the

localized condition placed

on availability.

Awareness Affordability

Accessibility

Availability

Partnering on digital health

to create value for patients

UCB recognizes digital health as an increasingly viable way to improve healthcare

access, experiences and outcomes. Our goal is to position our platform strategy

around patient populations where we have expertise.

As part of our broader digital business transformation, we

drive digital health partnerships that accelerate diagnosis,

treatment selection, patient experience and adherence,

and allow patients to better understand their own disease.

We measure our performance through the number of

partnerships established and managed. As of end of 2021,

UCB was involved in five digital health platform partnerships.

In 2022, we made substantial progress by bringing four more

digital health platform partnerships into the fold.

In immunology, 2022 saw us advance our FASTRAX program

to address breakpoints in the journey of patients living with

axial spondylarthritis (axSpA). We established partnerships in

Canada, the U.K. and France with digital solution providers

and the local healthcare ecosystems.

Respectively, these platforms are developing virtual backpain

clinics, facilitating remote patient management and follow

up, and forging a primary care patient assessment and referral

partnership for people living with axial spondylarthritis.

Our sponsorship of global non-profit Digital Medicine Society

(DiMe) helped build partnerships with leading platforms

to advance digital medicine, with a particular focus on

people living with atopic dermatitis (AtD) to deepen our

understanding of diseases affecting skin.

In the case of AtD, objective and continuous measurement

of nocturnal scratching has the potential to complement

the perceptions, observations and experiences measured by

traditional measures and be a powerful tool to assess the efficacy

of interventions. By providing a more meaningful and complete

understanding of patients’ responses, we can potentially reduce

time and cost of bringing new therapies to market.

In parallel, UCB has continued its research partnership with

Sharecare to advance AI-based measurement models which map

facial muscle changes and vocal muscle weakness in people with

MG, directly from their smartphone. While algorithm development

is still in early stages, we believe in the promise of AI technology to

help people track disease progression more objectively.

Alongside these newly established disease area-specific

partnerships, UCB also made progress in supporting the digital

health platform innovation ecosystem.

In January 2022, we launched our digital health incubator

program, which, in its first round, scouted more than 450

start-ups across seven different challenges for four patient

populations. By the end of the year, we had incubated four

start-ups, one of which – VRX Medical – is now exploring

further collaborations with UCB.

By providing a more meaningful and complete understanding

of patients’ conditions and responses, we can potentially

reduce the time and cost of bringing new therapies to market.

LEARN MORE

UCB | Integrated Annual Report 2022

Advancing a

Culture of

Care for UCB

Employees

At UCB, we value and nurture diverse perspectives

and backgrounds and show respect and care for

each other. We are made stronger because of

our culture of collaboration and curiosity which

allows us to create value for patients, for each

other and for society.

1 UCB Global Engagement Survey, May 2022, completed with 77% response rate. 76% agreed that “UCB has a great culture”.

UCB | Integrated Annual Report 2022

Advancing a Culture of

Care for UCB Employees

UCB is its people. Across the company, our people share a commitment to leveraging

discovery and innovation to create value for people living with severe diseases and

to improve the health and wellbeing of the society in which we live. We invest in and

care about our people and empower them to lead, innovate and grow.

Through 2022, we aimed to drive progress in four key areas:

nurturing our culture, improving health, safety and wellbeing,

promoting greater diversity, equity and inclusion, and enhancing

We invest in and care about our people and

empower them to lead, innovate and grow.

employee development. Our fundamental goal is to foster a

safe and inclusive environment where UCB colleagues can be

themselves, grow and express their full potential.

In a competitive talent market, we intend our culture to

be a differentiator that attracts and retains the right talent,

integrating new employees faster around a shared culture,

and deepening the connection between UCB and the

people we serve.

Our 2022 performance was underpinned by several initiatives

to bolster company culture. New leadership and employee

dialogs created space to reflect on how our culture guides

us to deliver on UCB’s goals, while a refreshed onboarding

e-learning and new online employee community fostered

more comprehension and commitment to our principles. We

will continue to instil these principles across the organization,

ensuring our leaders and employees are accountable for living

our culture every day.

Nurturing our

company culture

Our objective is to make our culture visible, lived, and positioned as a key enabler

of our success – creating value for patients by encouraging our people to care,

demonstrate curiosity, be accountable for their contribution to UCB’s sustainable

performance, and have the courage to make bold decisions while balancing risks.

UCB employees see purpose in their work

77%

74/100

Global Response Rate

(vs 80% benchmark

)

Global Engagement Score

(vs 79/100 benchmark

)

Our 2022 performance

was underpinned by

several initiatives to bolster

company culture.

1 UCB Global Engagement Survey, May 2022.

2 High-performing benchmark of the top 25% high performing global industry

using Glint platform.

UCB | Integrated Annual Report 2022

Our culture of curiosity encourages all UCB employees to

integrate external and internal stakeholder insights – going

from noise to signal to better meet the needs of patients and

our business.

In 2022, we launched an online community where employees

can share how their work brings this culture to life. This way, we

ensure people living with diseases and their needs inform our

decision making, while remaining self-aware and mitigating any

personal biases through feedback and collaboration. Our Head

of Medical Affairs in Rheumatology, John Ioannou, shares how

the team brought this principle to life.

“We were exploring a novel treatment regimen with potential

to elevate remission rates in a chronic inflammatory rheumatic

disease. Some team members felt people may find the

proposed novel treatment protocol burdensome. After some

back and forth, we thought: why not just ask patients directly?

So early on, we spoke with 25 people living with the disease.

We discussed the idea objectively, exploring what treatment

involved as well as potential risks and benefits, to get their open

and frank views.

In the end, all 25 were highly supportive of the idea: they felt

the proposed protocol would not be burdensome and that the

potential risks were relatively small, in relation to the benefits.

Living our culture

Spotlight:

“For me, it was a reminder to be continuously self-aware of potential

biases and avoid falling into the trap of thinking we know what is best

for patients. Sometimes, it’s the patients that have the best answers.”

John Ioannou, Head of Medical Affairs in Rheumatology

This was a (pleasant!) surprise to the team, and these impactful

conversations provided many learnings. It also boosted our

motivation to progress and highlighted the need to ensure

patient views are taken into consideration early in the process.

“For me, it was a reminder to be continuously self-aware of

potential biases and avoid falling into the trap of thinking we

know what is best for patients. Sometimes, it’s the patients that

have the best answers.”

Putting health, safety

and wellbeing first

At UCB, we recognize that creating value for patients starts with taking care

of ourselves and fostering an environment where people can thrive. Our

health, safety and wellbeing (HSWB) approach is organized in three pillars:

1. Safety excellence: reducing and mitigating high risk activities

to ensure a safe working environment.

2. Health and wellbeing: continuing to implement our

wellbeing delivery model – focused on physical wellbeing,

mental wellbeing, interacting with care, social wellbeing

and purpose and growth – to drive progress in meeting

employee’s wellbeing needs.

3. Product safety stewardship: enhancing compliance and

managing the potentially harmful impact of our chemicals

and biological agents throughout a product’s entire lifecycle.

The proper management of our HSWB risks and the associated

oversight of performance is a complementary and transversal

dimension of our integrated approach to health, safety

and wellbeing.

It aims to guarantee that the approach is properly

implemented through sustained performance management

and by instilling a health, safety and wellbeing mindset into

our day-to-day work.

It is also in this perspective that our manufacturing sites in

Bulle (Switzerland), Zhuhai (China) and Saitama (Japan) are

ISO 45001 certified, and we are looking into certifying our

other manufacturing sites. We report on additional social

risks in the Risk Management section of this report.

Accompanying our broader HSWB approach, we continued

to use our wellbeing delivery model to drive progress in

meeting employees’ needs.

Mental wellbeing

I am able to align my

thoughts, emotions and

actions

Interacting with care

I embrace the uniqueness of

my colleagues and create the

conditions for them to thrive

Social wellbeing

I have fulfilling c

onnections

inside and outside the

organization

Purpose & Growth

I am fulfilled by what I do

each day and have the

opportunity to continuously

develop

Physical wellbeing

I am safe, in good health

and energized

Wellbeing delivery model

UCB | Integrated Annual Report 2022

Measuring our 2022 performance

In 2022, we continued using our HSWB Index (launched in

2020) to comprehensively measure our overall performance,

through two main indicators:

• A Safety Performance Indicator – consists of the Lost Time

Incident Rate (LTIR

) for UCB employees, for incidents with

at least one day lost from work by an injured employee;

accounts for 30% of HSWB Index.

• A HSWB Indicator – combines results from our annual

global HSWB survey with relevant employee metrics such as

promotion rate, personal development plan engagement rate,

and employee assistance program coverage. Survey results

are weighed at 65%, and employee metrics at 35%; together

they account for 70% of the HSWB Index.

Overall, in 2022, UCB’s HSWB Index result decreased to 80.4%,

from 81.9% in 2021. Our LTIR was (β) 1.58, still in line with our

internal target. As a result, we achieved a safety performance

indicator score of 100%. Our HSWB indicator decreased slightly

to 72% compared to 74.1% in 2021 which is the consequence

of the lower results obtained in our global survey. This reflects

a challenging context with external geopolitical and socio-

economic tensions and a sustained workload. The two

dimensions which were the most impacted were physical

wellbeing (-5.4%) and mental wellbeing (-3.5%). The results of

this survey will assist in defining action plans aimed at improving

employees’ wellbeing.

HSWB Index

80.4%

Safety

Performance

Indicator

100%

HSWB

Indicator

72%

Alongside the HSWB Index, we also observed a slight increase

in UCB’s Total Recordable Incident Rate (TRIR

), which in 2022

was (β) 2.21, compared to 1.96

in 2021. The TRIR is composed

of data around lost time injuries, medical treatments beyond first

aid, restricted workplaces, loss of consciousness and fatalities.

In 2022, no work-related ill health was reported.

We increased digital tools usage to drive specific aspects of

HSWB reporting, launching a centralized electronic quality,

safety, health and environment management system that

allows shared vigilance to improve health, safety and protect

the environment. Employees can identify work-related risks

and ensure corrective and preventive action plans are recorded

and tracked.

1 LTIR refers to the number of occupational accidents which result in a person being away from the workplace for one or more days following the day of the injury, per million

hours worked. For Bulgaria, Canada, China, India, South Korea, Poland, Russia, Switzerland and Turkey both UCB employees and employees who work under the direct

supervision of UCB are in scope. For all other countries and sites, only UCB employees are in scope. In 2022, 15.856.533 worked hours were in scope for the calculation of LTIR.

2 TRIR refers to the number of recordable accidents which occurred in a given period relative to the total number of hours worked in the period, per million hours worked. The

scope is the same as the LTIR.

3 In 2021 we reported a TRIR of 2.05, which we recalculated this year for matching the same scope of countries where both UCB employees and employees who work under the

direct supervision of UCB are covered in this indicator. In 2022, 15.856.533 worked hours were in scope for the calculation of TRIR.

Initiatives making a difference on safety

Globally, a new visible-felt safety leadership behavior training

course for 70+ managers was held, as well as a safety peer

recognition course and continued monitoring programs

to oversee exposure to industrial hygiene and ergonomic

risks. We expanded our Safe Driving Program, which delivers

personalized training courses on driving behaviors, from five

initial countries to a global rollout for more than 2 300 UCB

employees who drive for professional purposes every day.

All HSE adverse events are investigated, with timely actions

taken to prevent recurrence and enhance transversal

learnings. UCB is also part of the Pharmaceutical Supply

Chain Initiative (PSCI), a group of pharmaceutical and

healthcare companies who share a vision of better

social, health, safety, and environmental outcomes in the

communities.

Initiatives making a difference on

health and wellbeing

Across our locations, occupational health is managed following

local regulations and in consultation with workers. Physical tests

carried out by health professionals identify any preventive measures

to ensure job safety, while local sites develop specific offerings to

promote worker health, such as fitness rooms or break rooms for

night shift workers. Additionally, locations with high-impact activities

(e.g., manufacturing) now benefit from on-site health professionals,

with volunteer first-aid teams deployed on all UCB sites. Active

participation in our global Risk Management Process at enterprise

level is also a necessary means to escalate major risks.

In 2022, we continued to build on our hybrid working model to offer

our employees flexibility while remaining connected, with training

sessions and a new online community to offer hybrid teams advice

on how best to collaborate and care for each other.

We also made progress in localizing our wellbeing delivery programs

based on 2021 HSWB Index results. In the U.S., for instance, we

redesigned our benefits to include free access to the Peloton

app

and additional recharge days (all employees off on the same day).

Our U.S. employee assistance program run by Cigna offers a range

of resources – including online physical therapy classes, therapy

sessions, and wellbeing webinars covering everything from stress

management to loneliness.

UCB | Integrated Annual Report 2022

Taking advantage of our location’s ecology and

biodiversity, in 2022, we launched an urban farm at

our sites in Brussels and Braine-l’Alleud, Belgium to

enhance the wellbeing of our employees.

Urban farming is the practice of cultivating, processing,

and distributing food in or around urban areas. People

can reconnect with nature, connect with others and

learn through unique experiences in a green and

ecological community space.

UCB’s urban farm in Brussels was developed by our

partners Bamboo Project and Ferme du Parc Maximilien

and launched in April 2022. Since then, more than

350 UCB employees have taken part in a variety of

community building activities, including farming, food

preservation workshops and cooking classes.

Enhancing employee

wellbeing through urban

farming

Spotlight:

UCB is also part of the Pharmaceutical Supply Chain

Initiative (PSCI), a group of pharmaceutical and healthcare

companies who share a vision of better social, health, safety, and

environmental outcomes in the communities.

Diversity, equity and inclusion

We believe a diverse, equitable and inclusive environment spurs innovation through

new perspectives, creates greater trust within teams, and contributes to a rewarding,

inspiring and high-performing organization. Our goal is to embed diversity, equity and

inclusion (DE&I) into everything we do – reflected in how we behave towards each

other, how we operate, and how we deliver value for patients.

As an organization, we look to embed DE&I into our

organization on two levels:

• Mindset - Promoting behavioral inclusion like mitigating

unconscious bias, developing more inclusive habits and

promoting active allyship.

• System - Infusing structural inclusion into company

processes, such as recruitment and learning opportunities.

Our roadmap leverages diversity of thought and experience,

supporting an inclusive and equitable workplace for all. Our

global DE&I targets aim to:

1. Sustain overall gender balance and reach 45%

female/55% male gender balance target at executive

level by 2025.

2. Improve our scores in our inclusion index.

In 2022, we slightly improved our gender balance at executive

level, reaching a ratio of 38% female and 62% male. Our

inclusion score of 70.7% – derived from our Global Inclusion

Survey which measures employees’ perspective on seven

drivers for inclusion – showed that overall inclusion and

diversity are valued by UCB employees. We continue to work

on other dimensions such as the perception of equitable

opportunities across the company and the promotion of

psychological safety in their teams by our leaders. The results

of the survey will guide our efforts for the next year.

Strengthening our DE&I mindset

We continued to strengthen our DE&I mindset by supporting

leaders across the company, including during group coaching

sessions. We concentrated our efforts on key moments like

objective setting and performance reviews, while engaging all

employees with an ongoing storytelling series demonstrating

how DE&I is lived throughout UCB. Additionally, we

continued to roll out our Inclusive Mindset Journey to help

employees mitigate unconscious bias and build inclusive

habits, supported by 70 internal facilitators.

Bolstering our DE&I structures

In 2022, we expanded and structured our local DE&I

councils to 14 countries to drive locally relevant initiatives

and ensure our global strategy fits local needs and cultural

relevancy. These councils are based in Canada, Germany,

Ireland, Japan, Switzerland, the U.K., and the U.S., with

emerging councils in Belgium, Brazil, China, France,

Portugal, Spain, and Mexico. And we continued to leverage

the momentum of our 8 Employee Resource Groups (ERG),

which advocate for their communities through education,

mentorship opportunities and career development.

Diversity, equity & inclusion at UCB is deeply ingrained

in how we behave and operate.

2022 Performance

70.7%

38% 62%

female male

Inclusion Index

Gender balance

at executive level

UCB | Integrated Annual Report 2022

ERG Members

2 000

of UCB’s workforce

involved in ERGs

24%

Employee development

To deliver on our mission to improve the lives of people living with severe

diseases and for our business to see long-term success, our people must

have the capacity to reflect, evolve and enable their growth.

Our goal is to ensure that they gain a better understanding of

how to progressively expand their capabilities and be ready

to thrive in their current and future roles.

We strive to develop relevant, impactful and easy-to-

access learning offerings, operating a skills-based learning

organization where learning journeys can develop strategic

capabilities. In 2022, we evolved the maturity of four strategic

capabilities (Digital Business Transformation; Rare Diseases;

Launch Excellence; Gene Therapy) through trainings, along

with building leadership capabilities, and commercial and

medical capabilities beyond launch excellence. We will

drive progress by continuing to focus on integrating user

experience by design, implementing data-driven decisions,

leveraging technology, and embedding a growth mindset.

Fostering employee development

through digital

We further leveraged digital tools for employee development

through 2022 – notably launching UCB RISE, a one-stop

learning experience that empowers our people to take

ownership of their career. The platform leverages AI to

connect all UCB content, support in-demand workflow skills

and strengthen our ability to build future capabilities faster.

With 200+ resources to upskill on digital business

transformation (DBT), adding up to 500 hours of learning,

UCB RISE aims to equip employees with five DBT

competencies: business acumen, digital acumen, data

literacy, executing with excellence and championing change.

Our progress in learning and development

In 2022, we measured our performance in learning and

development by monitoring the learning hours and how

they are distributed throughout the different teams in the

organization, to help us understand which capabilities and skills

have generated the most activity. We also track the Learner

Net Promoter Score of our different trainings, to measure how

impactful the different learning offerings are.

In 2022, we drove employee development progress

by leveraging digital tools.

2022 Performance

average learning hours

per employee

unique learners

9 764

UCB | Integrated Annual Report 2022

As part of our learning and development measurement,

UCB also considers how many employees received regular

performance and career development reviews. In 2022, 97%

of our employees received regular performance reviews (up

1% from 2021), and 92% received regular career development

reviews (up 10% from 2021).

Our goal is to ensure that employees gain a better understanding of

how to progressively expand their capabilities and be ready to thrive

in their current and future roles.

Our progress in acquiring and retaining talent

UCB maintains its strong commitment to investing in its

Early Careers program and fostering the next generation

of leaders in commercial, engineering, and scientific roles.

We will continue to promote candidates internally wherever

possible and focus external recruitment on bringing new and

differentiating skillsets into the company.

Our 2022 results show UCB continued to thrive in a

challenging recruitment environment. We have continued to

promote candidates internally wherever possible and to focus

external recruitment towards bringing new and differentiating

skillsets into the company. In 2022 we increased overall

internal mobility from 20% to 27%.

This results from a range of talent acquisition initiatives,

including recruitment drives supported by investment in

our employer brand and targeted social media recruitment

campaigns, alongside our new internal career site in line with

our commitment to increase internal mobility.

1 061

new colleagues were

welcomed to UCB in 2022

Did you know?

UCB | Integrated Annual Report 2022

Developing R&D talent

Our talent market is highly competitive, given the specialized

nature of our industry. To attract, develop and retain top

research and development (R&D) talent, we run various

initiatives targeted specifically at scientists and R&D

professionals. In 2022, this included:

• Continuing to offer job rotations between different roles to

all employees working in Development Solutions, to expand

their professional experience by collaborating across different

departments.

• Roll out of a sponsorship program between UCB executives

and junior employees to develop emerging talent.

Our branding and recruitment campaigns support our

Diversity, Equity and Inclusion objectives. Recruitment

efforts to expand our gene therapy team are a

clear example.

We worked to attract a diverse range of candidates through

targeted recruitment campaigns, while partnering with

DE&I associations to strive for equal representation in gene

therapy candidates. As part of this specific recruitment

drive, 50% of candidates were sourced outside Belgium

(particularly in China, Germany, Iceland, India, Ireland,

Turkey and U.K.).

And in conjunction with our attraction campaigns, we

developed specific talent programs and event interventions,

such as the Empowered Females STEM Mentoring

Program, to inspire the next generation of women to

embark on a STEM career. Our gender diversity for gene

therapy teams stands above the curve, with 47% of new

hires being women compared to a market average of 33%.

Focusing on DE&I for Gene Therapy talent

Spotlight:

• Introducing our Project Leader Learning Journey, which

aims to equip UCB employees with the wealth of technical,

scientific and leadership skills required of project leaders. The

Journey was launched in April 2022 following a mapping of

project leadership needs, and a series of interviews with junior

and senior project leaders.

• Aiming to recruit and retain the best R&D talent by continuing

to fund a series of internal and external PhDs at several

academic institutions in the U.K. and EU.

1 These academic institutions include the Universities of Oxford and Cambridge, University College London, King’s College London, Queen Mary London, the

Universities of Bristol, Bath, Edinburgh, Manchester, Liverpool, Leicester, Birmingham, Aberdeen, Southampton, Nottingham Trent (UK) as well as Maastricht University

(Netherlands), KU Leuven (Belgium) and Johannes Kepler University Linz (Austria).

UCB | Integrated Annual Report 2022

Advancing

Healthier

Communities

To create value for communities, we partner

with and support organizations and institutions

in areas that can contribute to improving health

around us, where we can have the biggest

impact. We aim to deepen our local connections

in the communities where we operate and help

to address disparities in health and education

amongst underserved populations.

1 CO₂e emissions compared with 2015 baseline year.

UCB | Integrated Annual Report 2022

Reinforcing our supply chain

and strengthening responsible

procurement

Through our global supply chain organization, we ensure end-to-end

oversight of supply – from procuring raw materials, goods and services

to delivering in countries directly.

Together, our internal development and manufacturing

capabilities and external network cover the full spectrum

of Chemistry, Manufacturing and Controls (CMC) activities

for small and large molecules – from process, analytical,

formulation, device and packaging development to pre-

clinical, clinical and commercial drug substance, as well as

drug product manufacturing, fill and finish, device assembly

and packaging. These activities are performed across our

sites and at selected partners and contract manufacturing

organizations (CMOs). We operate distribution centers

worldwide for direct distribution of most of our commercial

and clinical products, supplemented by third party distributors.

We aim to provide uninterrupted supply to patients, including

access to new medical products, while improving efficiency

in our supply chain. This is underpinned by our environmental

goals and UCB’s commitment to reduce greenhouse gas

(GHG) emissions in our supply chain. We measure progress

by looking at a range of indicators, from availability to product

delivery to GHG emissions generated.

More information about our environmental progress can

be found in the Advancing a Healthier Planet chapter

of the report.

We continue to identify opportunities for greater efficiencies,

whether cost avoidance or waste reduction. For example,

our Italian affiliate now reuses cardboard boxes from primary

distribution activities for secondary distribution. This simple

initiative saved 7.9 tons of greenhouse gas emissions in

2022 and is a vivid demonstration of how our colleagues

are taking the lead in contributing to UCB’s environmental

sustainability goals.

This transformation program will continue in 2023 and

beyond. We will further strengthen planning capabilities,

particularly on scenario planning. Here, we look to extend

our digital transformation roadmap through data-enabled

decision-making, increasing visibility and collaboration, and

simplifying our ways of working by removing non-value-added

work. In addition, we are establishing a new partnership with a

lead logistics provider to optimize our transportation planning

operations.

We aim to provide uninterrupted

supply to patients, including

access to new medical products,

while improving efficiency in

our supply chain.

Partnering with our suppliers for better

societal impact and reduction of our

environmental footprint

Our ambition is to create sustainable growth by procuring

goods and services that reap benefits not just for UCB, but for

the environment and our society.

Our targets are:

We continue to engage with our suppliers and reinforce sourcing

processes in line with our Scope 3 climate target validated by the

Science-Based Targets Initiative. In line with our environmental

ambitions, we rank strategic and prospective suppliers on their

'carbon maturity', from Level A to Level F, depending on their own

climate change mitigation commitments, and their impact on

our Scope 3 GHG emissions. Level A suppliers have committed

to, or have already validated their science-based carbon

reduction targets. Going forward, only suppliers on Level A or B

will be categorized as 'Preferred Vendors'. In 2022, 30% of our

suppliers (by GHG emissions) have committed to, or have already

validated their science-based carbon reduction targets. For more

information about how UCB suppliers are being encouraged to

reach their own climate targets, see the Advancing a Healthier

Planet chapter.

By 2025, 60% of GHG emissions

emitted by our suppliers will be covered by

SBTi-like targets (these represent, in turn, our

own Scope 3 emissions), reached through

progressive internal targets (30% by 2022,

45% by 2023 and up to 60% by 2025).

All strategic

suppliers to be rated

by EcoVadis with a

positive score.

By 2023, 20% of our

spend in the U.S. will

be allocated to diverse

suppliers.

20%

LEVEL A

Science based targets

LEVEL B

Reduction target

LEVEL C

Reduction plan

without targets

LEVEL D

Plans to establish a

reduction plan

LEVEL E

Plans to calculate &

disclose CO₂e emissions

LEVEL F

Does not calculate

CO₂e emissions

UCB | Integrated Annual Report 2022

of suppliers (by CO₂e

emissions) committed to

science based targets

We continue to partner with EcoVadis, to rate the sustainability

performance of strategic suppliers on environmental matters,

labor and human rights, ethical business practices and

sustainable procurement practices. In 2022, 284 suppliers

were

assessed for environmental impacts.

Our expectation is that all suppliers maintain a minimum

EcoVadis score of 45/100 and follow corrective action plans,

when necessary, to continuously improve their performance. By

choosing partners with clear carbon reduction goals and plans,

we reinforce our supply chain’s resilience.

We also continue to collaborate with RiskMethods, a supply

chain risk management software, to identify potential risk in

terms of fair labor practices and human rights, and ethical

business behavior. Our risk management approach includes

future risks related to environmental physical hazards and water

scarcity for our strategic suppliers.

LEARN MORE

2022 Performance

30%

18.2%

of U.S. spend allocated to

diverse suppliers (target 20%)

249

suppliers with EcoVadis

score over 45/100

284

suppliers assessed by EcoVadis

75%

of critical suppliers

engaged

1 This group includes strategic suppliers, contract manufacturing organizations (CMOs) and contract research organizations (CROs).

2 Critical suppliers are those having an impact of 80% on our Scope 3 GHG emissions for purchased goods and services.

By choosing partners with clear

carbon reduction goals and

plans, we reinforce our supply

chain’s resilience.

Driving progress in healthcare

through partnerships

We believe partnerships create better value for patients. We partner with and listen

to patients, caregivers and stakeholders across the healthcare system to identify

promising innovations that create valuable health solutions.

To leverage the best technologies, research and operational

advancements in developing new medicines, we collaborate

outside of organizational, geographical and sector boundaries.

To this end, we seek to partner with industry groups, academic

institutions and patient representative groups to better meet the

needs of people living with severe diseases – through research,

patient engagement and co-creation, and shared efforts to

solve common challenges – and work constructively with

governments and authorities to deliver our medicines to those

who need them. Examples of these partnerships can be found

across the report, illustrating how this approach is deeply rooted

in our culture.

UCB is a member of several industry associations around the

world including the International Federation of Pharmaceutical

Manufacturers & Associations, of which Jean-Christophe Tellier,

UCB Chief Executive Officer & Chairman of the Executive

Committee, is President. We are also members of the European

Federation of Pharmaceutical Industries and Associations,

Pharmaceutical Research and Manufacturers of America in

the U.S., Biotechnology Innovation Organization in the U.S.,

R&D-based Pharmaceutical Association Committee (RDPAC,

China), and Japan Pharmaceutical Manufacturers Association

(JPMA, Japan).

For instance, we have extensive collaborations in place in the

fields of immuno-dermatology and neurology to better embed

the real needs of specific patient populations in our innovation

process. UCB and Stanford University established a multi-

year collaboration, Digital Health Research Collaborative to

enhance patient value for people living with severe diseases.

There have been two calls for proposals for research projects,

one call focused on Hidradenitis Suppurative (HS) and one for

some specific neurology disease areas. By understanding the

key unmet needs for people living with these conditions, UCB

can more effectively create solutions that address these needs.

Likewise, our partnership with Le Bonheur Children’s

Hospital (Tennessee, U.S.), the Wisconsin Health Information

Organization (WHIO), and Yale University examines the impact

of seizure clusters on patient and caregiver quality of life. The

partnership will leverage the power of education and real-world

evidence (RWE) to address this research gap, expand awareness,

and enact positive change in the health outcomes of individuals

with seizure clusters.

UCB | Integrated Annual Report 2022

To meet tomorrow’s health challenges head on, we must

recruit extensively across the life sciences: investing in skills

development, high-tech facilities and pooling industry

recruitment efforts in areas like biomanufacturing and R&D.

In Belgium, we joined forces with Wallonia’s BioWin health

cluster, the Walloon government and other leading private

companies to launch ‘Talent Now’ in 2022 – a new public-

private consortium aiming to solve the talent shortage. The

project is developing new recruitment approaches, centralizing

recruitment and training needs (including Virtual Reality/

Augmented Reality learning technologies and transferable skills

plans), and reinforcing collaboration between businesses and

training providers.

Notably, the initiative will bring a new flagship EU Biotech

Campus to Gosselies by 2025. With state-of-the-art infrastructure

and services, the setting will serve as a one-stop shop for

professional training and business acceleration, at all levels. The

initiative has the potential to drive nearly 1 000 biomanufacturing

and R&D recruitments per year in Wallonia alone.

Attracting tomorrow’s talent with BioWin

Spotlight:

“We know most seizure clusters happen at home or during

other daily activities; treating seizure clusters where and when they

happen is critical for better patient outcomes.”

Dr. James Wheless, BScPharm, MD, FAAP, FAAN, FAES, Co-Director of the

Neuroscience Institute, Le Bonheur Children’s Hospital.

Supporting innovation

around us via UCB Ventures

At UCB, innovation is at the center of research and

development, to find new ways to deliver solutions and

opportunity to people living with severe diseases.

UCB Ventures is a key vehicle for exploring innovation in

areas outside of our current capabilities. Here, we invest

in high risk, early stage, disruptive technologies across the

medical community, to explore new areas with the potential

to unlock impactful innovations.

Five years after creation, UCB Ventures continues to provide

a window for new technologies, products, platforms, and

channels to invest in emerging players in our sector, particularly

start-ups. Above all, the team are committed long-term

investors, working closely with a community of experts, venture

capitalists, and entrepreneurs to bring out the best in our

portfolio companies.

In 2022, UCB spin-off Syndesi, which received financing from

UCB Ventures, was acquired by AbbVie for a total deal value of

up to US$1 billion. Syndesi’s portfolio includes novel modulators

of the synaptic vesicle protein 2A (SV2A). The mechanism

is currently being evaluated for the potential treatment of

cognitive impairment and other symptoms associated with a

range of neuropsychiatric and neurodegenerative disorders,

such as Alzheimer’s disease and major depressive disorder.

Another UCB Ventures investment, Neurona Therapeutics, has

had encouraging initial data from its Phase 1/2 first-in-human

(FIH) clinical study of inhibitory neuron cell therapy (NRTX-1001)

to treat drug resistant focal epilepsy.

Five years after its creation,

UCB Ventures continues to

provide a window for new

technologies, products,

platforms, and channels.

Since its inception, UCB

Ventures has invested in

early-stage biotech

companies.

UCB | Integrated Annual Report 2022

Paying our fair

share of taxes

As a multinational corporation, UCB believes in our corporate

responsibility to pay and collect our fair share of taxes, in line with

value created locally.

We do this through effective guardianship of UCB tax revenues,

including proactive engagement with tax authorities, backed

by skilled functional experts from diverse backgrounds. Our tax

strategy is integral to UCB’s ethical and sustainability practices

and constitutes part of UCB’s Code of Conduct for employees

and suppliers.

In 2022, we paid €91 million in income tax. In addition, we paid

and collected a multitude of other taxes such as customs duties,

excise taxes, employment taxes and indirect taxes. The taxes

borne, paid and collected

represent a significant contribution

to communities in which UCB operates, supporting further

investment in innovation, education and public infrastructure.

UCB does not use 'tax havens' or 'non-cooperative jurisdictions'

for any business set-up that could be considered as harmful

tax practices.

In 2022, UCB also took the initiative to increase transparency

around its tax strategy by publishing its Tax Policy Statement,

endorsed by the UCB Board, Audit Committee and Executive

Committee. We will continue to review our Tax Policy Statement

on an annual basis to identify further opportunities to provide

more transparency around our tax operations and disclosures.

LEARN MORE

1 Taxes borne are defined as taxes for which UCB carries the cost. Taxes collected are defined as taxes collected by UCB on behalf of others, mostly by

employment generated taxes such as employee income taxes and paid on to the competent governments/authorities.

Supporting underserved

communities through philanthropy

At UCB, philanthropy is inspired by health and the expressed needs of

communities. We want to be part of the solution to the issues communities

face, in countries where we operate and beyond. Our philanthropic

contributions are impactful and sustainable, and grounded in our commitment

to ethical business practices and diversity, equity and inclusion.

We partner with expert organizations to deliver our greatest impact in four key areas:

Supporting education

on science, technology,

engineering and

mathematics (STEM)

Partnering with diverse

communities to

promote health in their

environments

Strengthening

healthcare systems

and reducing

healthcare disparities

Supporting emergency

assistance and longer-

term rebuilding efforts,

together with partners

INSPIRING SCIENCE

FOR BETTER

HEALTH

INSPIRING COMMUNITIES

TOWARD BETTER

HEALTH

INSPIRING ACCESS

TO BETTER

HEALTHCARE

PROVIDING EMERGENCY

RELIEF IN TIMES OF

HUMANITARIAN CRISIS

Inspiring Science

for Better Health

In the U.S., part of our philanthropic

contribution is focused on inspiring the next

generation of scientists and shaping a future

biopharmaceutical workforce that reflects the

wider population in gender, race and ethnicity. To address

the current gap, we support community-based Science

Technology Engineering & Mathematics (STEM) programs

near our offices in Atlanta, Boston, North Carolina,

and Seattle, with emphasis on reaching students from

underserved communities.

In 2022, we supported 15 U.S. organizations with monetary

and in-kind support. In 2022, UCB newly supported Young

Women in Bio (YWIB) which works across the U.S. and

Canada to provide hands-on educational experience to

girls, inspiring and supporting them from elementary to high

school years to become tomorrow’s leaders in STEM.

2022 Performance

14 000

More than

U.S. organizations supported

U.S. students benefited from

UCB support in 2022

UCB | Integrated Annual Report 2022

We continued our support for BioBuilder, and their Boston-

based training program which prepares low-income or

recently immigrated teenagers for paid summer internships.

A grant from UCB has expanded BioBuilder’s High School

Apprenticeship Challenge, a rigorous eight-week program

that teaches technical and professional skills, including lab

techniques, scientific thinking, and teamwork. Working in

BioBuilder’s state-of-the-art Learning Lab and supported

by professional mentors, apprentices learn topics ranging

from bioengineering to lab math to research skills like sterile

technique and molecular biology. In addition to our financial

support, several UCB scientists from all over the country have

provided insights into their own career paths.

Since 2016, BioBuilder’s Apprenticeship has accepted 150

students from 36 different high schools in the Boston metro

area. Last year more than 70% were students of color and

90% went on to secure paid summer internships. Through

support for programs such as those provided by BioBuilder,

UCB aims to increase representation among under-

represented students and we reinforce our commitment to

inspiring the future of life sciences.

BioBuilder

Spotlight:

"Serving as a mentor has been a great opportunity to hear from

students about their projects and poster presentations and to provide

scientific feedback and suggestions.”

Yuan Wang, UCB’s Head of Research Analytics

2020 - 2022 summary. Developed with UCB’s Visualization Community.

Inspiring Communities

toward Better Health

After the challenges of a global pandemic,

rising social inequalities and heightened

geopolitical tensions, many young people

face additional insecurity. During 2022,

the UCB Community Health Fund, managed by the King

Baudouin Foundation, supported 49 organizations and

distributed around € 2 million in grant funding.

Based on the selection made by independent selection

committees, 44 organizations will be supported in 2023.

In 2022, the fund received 144 new grant requests from

organizations whose projects help people aged 15-24 with

mental health disorders, and young people who have been

displaced due to conflict situations. Based on the selection

made by independent selection committees, 44 organizations

will be supported in 2023.

UCB | Integrated Annual Report 2022

Through the Community Health Fund, we fund

projects that support mental health initiatives

for vulnerable youth. Among the organizations

UCB supported in 2022 is Macadam – a Brussels-

based association to support people experiencing

homelessness.

With more young people facing unstable living

situations – whether on the street, in shelters or in

unsafe or temporary housing, or struggling to pay rent –

Macadam strives to bridge the gap between institutional

support and the unmet needs of young people. Those

supported can access basic respite and hygiene services

free of charge, and receive dedicated support from a

social worker to build a new life.

Working to ensure no young

person ends up on the streets

Spotlight:

Inspiring Access to

Better Healthcare

We continue to work towards making the

treatment gap in epilepsy care smaller for

underserved populations. Our philanthropic

approach complements our social business

efforts to meet the needs of epilepsy patients in low- and

middle-income settings.

UCB’s Innovation for Health Equity Fund, managed by the

King Baudouin Foundation, supports initiatives that raise

awareness of epilepsy, improve training of health professionals

for access to qualified neurological care in the community,

and help increase acceptance of people living with epilepsy in

low- and middle-income countries, so they can enjoy a better

quality of life. For example, through the Fund, we support a

longstanding relationship between the University of Ghent and

the University of Rwanda to establish a university-level medical

curriculum to train qualified neurologists in Rwanda. In 2022,

a first cohort of physicians matriculated into the program with

the goal to become neurologists. The program’s aim is to train

16 neurologists by program completion in 2027.

LEARN MORE

Our philanthropic

approach complements our

social business efforts to

meet the needs of epilepsy

patients in low- and

middle-income settings.

UCB | Integrated Annual Report 2022

Providing emergency relief in

times of humanitarian crisis

Since the start of the war in Ukraine, we

focused on providing emergency support

to the small group of UCB employees living

in Ukraine and their families, and committed

to bring medicines to people living in Ukraine no matter how

difficult the circumstances. Amid disrupted supply chains, we

cooperated with non-governmental organizations (NGOs) and

authorities in Poland to deliver drug donations to patients in the

war zone, and donated 1.6 million doses of anti-epileptics and

35,000 daily doses of antihistamines. To support humanitarian

efforts, UCB made an early donation of €300,000 to the

German International Rescue Committee and Belgian

International Red Cross, and collaborated with Belgian non-

profit BEforUkraine to deliver essential equipment.

In the face of this refugee crisis, UCB colleagues around the

world demonstrated solidarity, whether helping in refugee

centers, making personal donations to charities, setting up

collection of essential goods at UCB sites, or hosting Ukrainian

colleagues and refugees in their houses. To facilitate this much-

needed movement of solidarity, we developed an employee

volunteering initiative to enable our colleagues in Europe to lend

a helping hand.

Additionally, UCB supported the American Red Cross following

devastating 2022 hurricanes in the U.S.

BEforUkraine Belgian non-profit organization, created in

March 2022 by a group of friends with the sole mission to

help Ukraine in the most effective way possible.

Specializing in buying essential, hard-to-find equipment

(including ambulances, refrigerated trucks and other vehicles)

from western Europe, the NGO transports provisions in

sizable quantities to trusted contacts in Poland, who forward

these provisions to officials in Ukraine to replace destroyed

infrastructure.

With civilians unable to travel safely, ambulances have become

mobile hospitals and play a vital role in responding to the

ongoing humanitarian crisis. To this end, UCB was proud in

2022 to finance ten fully-equipped refurbished ambulances –

fitted with defibrillators, portable anesthesia machine and other

essential medical supplies. Seven ambulances arrived in Ukraine

in October 2022.

UCB joins forces with

BEforUkraine to send

ambulances to Ukraine

Spotlight:

UCB | Integrated Annual Report 2022

Advancing a

Healthier Planet

We contribute to the transition towards a low

carbon and green economy to protect the planet

for future generations. As we bring new solutions to

patients, we strive to uncouple our growth from our

environmental footprint.

1 CO2e emissions that UCB directly controls are Scope 1, 2 and 3 emissions (except for the emissions from purchased goods and services)

2 Compared to our 2015 baseline in absolute numbers

UCB | Integrated Annual Report 2022

UCB is working to achieve all three environmental targets by

constantly working on transversal improvements across all business

activities, including in energy supply and processes

Health of the planet goals

It is clearer than ever that protecting human health also means safeguarding

the health of our planet. UCB has far-reaching absolute targets for reducing

our impact on the planet, with specific focus on climate change mitigation

and resilience, water and waste.

UCB is working to achieve all three environmental targets

by constantly working on transversal improvements across

all business activities, including supply and processes. Our

corporate environmental ambitions are broken down

into targets for each department and UCB solution with

associated roadmaps to reduce or enable reduction

of their environmental footprint, contributing to the

overarching ambition.

To this end, we built the Green Scorecard for Solutions,

aligned with the call to action for healthcare systems across

the world to significantly decrease their impact on the

planet as part of COP26 Health Program. Our framework,

based on a systematic “Cradle-to-grave” lifecycle analysis,

allows us to assess our impact and map opportunities

for environmental footprint reductions when developing

and producing solutions, with a continuous improvement

mindset. UCB also reports to the Task Force on Climate-

Related Financial Disclosures (TCFD) assessment and are,

for the first time, publicly sharing our disclosure in this

year’s report.

You can find more information about our full environmental

footprint at the end of the report. Environmental-related

risks are reported in the Risk Management section of

this report.

Reaching carbon

neutrality by 2030

The climate footprint of healthcare systems is equivalent to more than 4.4% of global

net emissions

1,2

, up to one third of which comes from manufacturing and distributing

medicines – emphasizing the role the pharmaceutical industry must play.

UCB has committed to science-based targets since 2019. To

reduce our carbon footprint, we have committed to reducing

absolute Scope 1, 2 and 3 GHG emissions under our control

by 38% by 2030, compared to 2015. We also committed to

ensuring that 60% of emissions created by our suppliers will

be covered by Science Based Target Initiative-like targets by

2025. To accelerate, and for areas where we cannot reduce our

1 Pichler PP, et al. International comparison of health care carbon footprints. Environ. Res. Lett. 2019;14(6):064004

2 The Shift Project. Décarboner la Santé pour soigner durablement. Available at: https://theshiftproject.org/wp-content/uploads/2021/11/211125-TSP-PTEF-

Rapport-final-Sante.pdf. Last Accessed: January 2023.

emissions in the short term, we will continue to compensate

to reach our goal of carbon neutrality by 2030.

In 2022, for UCB total Scope 1 and 2 emissions, we reduced

CO₂e emissions by 8% compared to 2021. This was

predominantly driven by a shift from natural gas to biomass

consumption and due to energy efficiency measures.

2015

Gas (natural gas

& biomethane)

2016 2017 2018 2019 2020 2021 2022

Tons

10 000

20 000

30 000

40 000

50 000

60 000

70 000

80 000

90 000

Fuel oil (fuel oil

& diesel for utility)

Car ﬂeet

Electricity

(market based)

2015

Business air travel

2016 2017 2018 2019 2020 2021 2022

Tons

20 000

40 000

60 000

80 000

100 000

120 000

Upstream transportation

& distribution

Fuel & energy related

activity

Waste generated

on site

Employee commuting

(pre-assured only)

Product end of life

Scope 1 and 2 CO₂e Emissions

2015

Gas (natural gas

& biomethane)

2016 2017 2018 2019 2020 2021 2022

Tons

10 000

20 000

30 000

40 000

50 000

60 000

70 000

80 000

90 000

Fuel oil (fuel oil

& diesel for utility)

Car ﬂeet

Electricity

(market based)

2015

Business air travel

2016 2017 2018 2019 2020 2021 2022

Tons

20 000

40 000

60 000

80 000

100 000

120 000

Upstream transportation

& distribution

Fuel & energy related

activity

Waste generated

on site

Employee commuting

(pre-assured only)

Product end of life

Scope 3 CO₂e Emissions Under UCB's Control

100

UCB | Integrated Annual Report 2022

Total Scope 1,2 and 3 GHG emissions (excluding emissions

from purchased goods and services) have increased by 10%

compared to 2021. This is mainly due to an increase in business

travel once most restrictions in place during the COVID-19

pandemic were lifted. Even though we note a 161% increase in

CO₂e emissions from business travel compared to 2021, these

emissions are still well below our 2019 level (the comparison

year before the COVID-19 pandemic). The emissions linked to

our car fleet follow the same trend given that 2022 was the first

year following the pandemic in which UCB employees fully

embraced our hybrid working model.

Emissions from upstream distribution and transportation

increased by 4% compared to 2021. First and foremost, there

was a need to return some distribution activities back to air

shipment to ensure timely medicine availability for patients, due

to increased sea freight delivery time and risk of delays. We also

saw an increase in emissions related to our bioproducts not yet

validated for sea shipment (for which distribution remains by

air freight).

Currently, 90% of UCB’s electricity comes from renewable

sources, either purchased or produced. We are continuing to

increase our own renewable energy production capacities.

In 2022, we signed an agreement with the Braine-l’Alleud

municipality to build the largest photovoltaic park in Wallonia.

The project, expected to be operational by summer 2023, will

see 32 000 solar panels installed close to our Braine campus

and will cover 25% of campus energy needs. We are also

shifting our car fleet towards electric vehicles, providing greener

transportation options where possible.

We also committed to

ensuring that 60% of

emissions created by our

suppliers will be covered

by Science Based Target

Initiative-like targets

by 2025

In 2022, we reduced our energy

consumption in Kwh (electricity

and gas) versus 2015 by

Did you know?

36%

Despite challenges ranging from worldwide supply chain

disruption to unprecedented port congestion, we are

committed to continue cutting our emissions by reducing our

medicine shipment weight and sizes and by transitioning from

air to ocean.

Since 2015, we have reduced CO₂e emissions linked to

transportation and the distribution of our products by 29%. By

doing so and compared to a business-as-usual (or “do nothing")

scenario, our initiatives have avoided an additional 48% in

emissions stemming from our business growth in 2022.

We are also progressing on our objective to achieve green

building certification (i.e., BREEAM Excellent / LEED gold

standard) for all new or significantly refurbished UCB buildings

and facilities. In 2022, UCB's Atlanta Warehouse was the world’s

first pharmaceutical project to be dually certified WELL Platinum

and Leadership in Energy and Environment Design (LEED) Gold

by the U.S. Green Building Council. The Atlanta Warehouse

building has reduced total energy consumption by 30%

compared to similar building averages and does not use any

fossil fuel energy.

Other key initiatives to advocate for change amongst employees

and the wider UCB community have included:

• A bi-annual digital cleanup campaign to raise awareness

about our digital footprint. As part of these efforts, we

committed to comply with and to achieve Agence

Lucie Sustainable IT Certification Level 2 – the highest

available globally.

• Workshops using the Climate Collage by the Climate Fresk

NGO and green coffee breaks to engage colleagues on

environmental topics and behavior at work and at home.

101

UCB acknowledges that greener suppliers form the most

sustainable partnerships to continue creating value for

people living with severe diseases. Goods and services

suppliers represent close to 80% of our carbon footprint

– making it crucial to build a portfolio of suppliers with

a strong environmental commitment. In 2022, we

developed a set of new guidelines and processes to

further incentivize partners to commit to the Science

Based Targets initiatives (SBTi) alongside us.

Our ambition is to support our current low-ranking

suppliers to commit or have a validated target from SBTi.

Carbon maturity levels represent a significant weight of

our selection criteria, and we include a Green Clause

in contracts requiring suppliers to demonstrate regular

progress on SBTi commitments to be a preferred vendor.

We monitor our suppliers’ compliance during our annual

carbon maturity survey. We continued to engage directly

with key suppliers, representing 60% of our emissions,

through several initiatives, for example with UCB’s CEO

Advocating for SBTI and incentivizing our suppliers to

move forward on their climate mitigation commitment

Spotlight:

Purchased goods

& services - scope 3

2019 2020 2021 2022

Tons

400 000

450 000

15%

25%

35%

500 000

550 000

600 000

650 000

700 000

750 000

800 000

663 936

11%

708 651

735 523

726 547

% of suppliers (by CO₂e

emissions committed to

Sciences Based Targets

21%

30%

directly engaging with some of our key suppliers’ CEOs

on the importance of their carbon commitment for UCB

partnership.

UCB is also now part of the Energize program to accelerate

renewable energy and bold climate action within the

pharmaceutical value chain. This first-of-its-kind industry

program will enable pharmaceutical suppliers to learn more

about renewable energy adoption and contracting.

We are thankful that our approach was recognized and UCB

awarded the “Supplier Engagement Leaders” title by the

CDP in 2022 based on the 2021 disclosure, a recognition

attributed to the top 8% of participating companies.

To date, 100% of our contract manufacturing organization

for devices have Science Based Targets.

More information about the environmental commitment

made by our suppliers can be found in the Advancing

Healthier Communities section of the report.

Scope 3 CO₂e Emissions From Purchased Goods & Services

102

UCB | Integrated Annual Report 2022

UCB is also taking part in several biodiversity projects which

capture and store carbon. Gold Standard certified projects will be

used by 2030 to compensate the emissions we cannot reduce

in the short term, in order to contribute to carbon neutrality.

We continue to collaborate with WeForest and CO2logic in the

Desa’a Forest in Northern Ethiopia and Virunga National Park in

the Democratic Republic of Congo to restore and regreen areas in

these habitats. By the end of 2022:

4 212 hectares

restored – marking

over one third of our

12 000-hectare target

3 569 hectares

restored and maintained

since CO2logic

partnership began

in 2016

4+ million

trees growing and

planted, including

70+ native species

6 000+

families benefited

from improved

cookstoves

Project is

Gold Standard

certified

Thousands

of natural structures

created to conserve water

and halt soil erosion

3+ million

trees planted and

grown

9 000+ families

benefited from employment,

increased access to water,

improved cookstoves

and solar lights

Northern Ethiopia

Democratic

Republic of Congo

103

UCB’s main manufacturing facilities have created a long-term

plan to decrease water consumption, through successively

monitoring, reducing and recycling. In 2022, we focused on

improving specific areas with significant water consumption,

such as our cooling towers. By optimizing water sampling and

automating fans we have seen a considerable saving in water,

equating to 12 000 m

/per year at our Braine-l'Alleud campus.

This effort is combined with green building certifications

and our green-by-design approach to decouple our growth

from our environmental footprint. For example, our new

Inflexio biologics plant in Belgium should consume 22% less

water compared to the average biologics plant (based on

environmental projections validated by the Wallonia region).

In 2022, we saw a decrease of -6% in water withdrawal

compared to 2021 due to a combined effect of reduction and

adjustment in planned capacity and rate. In 2023, our new

bio-manufacturing plant will start activities, so we foresee an

increase for the next few years. A water recycling pilot has

been launched, and we expect to see a full year reduction by

2026. The consumption in water stressed areas is stable.

Reducing water usage

by 20% by 2030

We continue our path to reduce water usage by 20% by 2030, in absolute terms

versus the 2015 baseline, aware that this is an ambitious target given the water-

intensive products being launched or part of our pipeline.

UCB is currently exploring recycling treated

wastewater into clean water, teaming up with Belgian

enterprise Ekopak whose innovative technology makes

wastewater treatment and water recycle possible on a

large scale.

We launched a pilot at UCB’s Braine-l'Alleud campus

to demonstrate feasibility, build rationale of “city water”

equivalence and define UCB’s water recycling strategy

for future implementation. If successful, we hope

to recycle up to 70% of our campus wastewater –

equivalent to yearly water needs for 4 110 people, as

defined by the United Nations General Assembly for

water and sanitation.

Treating water with Ekopak

Spotlight:

2015

Total water withdrawal

in low and medium water

stressed areas

2016 2017 2018 2019 2020 2021 2022

100 000

200 000

300 000

400 000

500 000

600 000

700 000

800 000

900 000

Non-hazardous waste

Hazardous waste

Total water withdrawal

in water stressed areas

2015 2016 2017 2018 2019 2020 2021 2022

Tons

2 000

4 000

6 000

8 000

10 000

Total water withdrawal

104

UCB | Integrated Annual Report 2022

Despite the reduction in quantity of waste generated in 2022,

our CO₂e emissions related to waste have increased due to

a change in the definition of recovered waste (following GRI

guidelines, waste that goes through European treatment code

R1 is no longer considered as recovered). This also explains the

decrease in the percentage of recovered waste, compared to

previous years.

UCB’s waste mapping reinforces the need to focus on reducing

the amount of fresh raw materials used in chemical production.

Our waste mapping pilot for one manufacturing process, from

delivery of raw materials to the warehouse and final stock of

finished products, detected more than 10 improvements with

waste reduction estimated at around 28% a year. This means we

can strengthen the integration of environmental parameters at

the heart of our manufacturing processes to progressively start

rolling out similar practices to all manufacturing operations.

To enhance our efforts, UCB adopted the Process Mass Intensity

(PMI) metric developed by the American Chemical Society’s

(ACS) Green Chemistry Institute (GCI). For every new pharma

molecule developed at UCB, we set a PMI target to monitor

and materialize our green-by-design approach. For every new

molecule produced, we follow three best practices – reduce,

reuse and recycle – to minimize waste generation.

Reducing absolute waste

generation by 25% by 2030

We have set out to reduce absolute waste generation by 25% by 2030, compared

with our 2015 base year. We are currently able to recover 70% of our waste

globally, mainly through solvent recovery and regeneration.

2015

Total water withdrawal

in low and medium water

stressed areas

2016 2017 2018 2019 2020 2021 2022

100 000

200 000

300 000

400 000

500 000

600 000

700 000

800 000

900 000

Non-hazardous waste

Hazardous waste

Total water withdrawal

in water stressed areas

2015 2016 2017 2018 2019 2020 2021 2022

Tons

2 000

4 000

6 000

8 000

10 000

Waste generated

105

106

UCB | Integrated Annual Report 2022

Advancing

Value for

Shareholders

We make informed choices to pursue the

solutions that deliver the greatest value,

responding to unique patient needs with

purposeful innovation that sets us apart. This

strengthens our foundations so that we can

deliver value and generate sustainable business

growth. We aim to deliver long-term value to our

shareholders, now and into the future.

107

108

UCB | Integrated Annual Report 2022

€1.18

€1.21

€1.24

€1.27

€1.30

€1.33

Gross Dividend €

1.0

1.2

1.3

1 .4

1.1

2017 2018 2019 2020 2021 2022

proposed

2021

€4.82

€4.78

€5.20

€5.36

€6.49

€4.37

Core EPS €

2022

2017 2018 2019 2020

Value for shareholders

We are guided by sustainability as our business approach and strongly

believe that we cannot be successful at the expense of other stakeholders,

namely patients, employees, the communities and the planet.

UCB’s reference and institutional shareholders share this long-

term, sustainable approach, and we appreciate the dialog with

them and their healthy challenges.

Core earnings per share (EPS) evolution

109

€1.18

€1.21

€1.24

€1.27

€1.30

€1.33

Gross Dividend €

1.0

1.2

1.3

1 .4

1.1

2017 2018 2019 2020 2021 2022

proposed

2021

€4.82

€4.78

€5.20

€5.36

€6.49

€4.37

Core EPS €

2022

2017 2018 2019 2020

Continued performance, delivery and

strong resilience

In the current challenging geopolitical and economic

environment, coupled with the expected loss of exclusivity for

some of our key products, we believe that UCB’s patient value

strategy remains, more than ever, our guiding principle to deliver

positive results for shareholders now and into the future.

Our 2022 financial results show our underlying resilience and

commitment to deliver on our promises to shareholders. We

have limited the earnings-dilutive impact of the Zogenix, Inc.

acquisition by a swift and successful integration. Strong cost

discipline mitigated the effect of inflation on UCB and focused

reallocation allowed us to protect the ongoing and planned

launches. Careful consideration led to a reliable updated

guidance for the year 2022 after the unexpected set-back

for bimekizumab in the U.S. We subsequently confirmed the

achievement of this guidance at the upper end in January 2023,

ahead of the full-year results. Now, we look forward to robust

long-term growth ahead and remain confident in our ability in

creating value for all stakeholders.

The year 2023 will be marked by ongoing launches and several

upcoming launches in the U.S., Europe and Japan - subject

to regulatory approvals. We have prepared these launches

over the past years and now aim to execute them to create

the necessary growth and achieve our 2025 guidance and

continued long-term growth. At the same time in 2023, UCB is

impacted by the full annualized and ongoing generic erosion

of VIMPAT

**. We will continue to monitor this erosion and to

focus on resource allocation and a disciplined cost approach.

Our financial guidance for 2023

Based on expected launch contributions like the expected

mid-year U.S. launch of bimekizumab

for people living with

psoriasis and taking into account the full annualized negative

impacts from the loss of exclusivity for VIMPAT

** in the U.S.

and Europe as well as based on continued solid contribution

from the existing product portfolio: we are aiming for revenue

in the range of € 5.15 - 5.35 billion. We will continue to invest

preparing upcoming launches to offer potential new solutions

for people living with severe diseases and remain committed

to invest in research and development advancing the late-

stage development pipeline. UCB will also continue to execute

strong cost discipline, divest non-core assets and try to mitigate

the significant (annualized) inflation impact in 2023. At the

same time, the integration of the Zogenix, Inc. acquisition will

become earnings accretive during 2023. Underlying profitability

(adj. EBITDA) is expected in the range of 22.5 – 23.5% of

total revenue.

We intend to continue a sustainable dividend policy of

stable, slightly growing dividends to reward the long-term

shareholders of UCB.

** Prescribing information varies depending on regulatory approval in each country.

110

UCB | Integrated Annual Report 2022

Working towards the future

UCB confirms its growth ambition for 2025 based on the strong

product portfolio and the promising medicines currently under

regulatory review – leading to multiple expected launches in

all geographies. We aim to achieve a leadership position in five

populations: patients living with partial onset/focal epileptic

seizures, women of childbearing age living with immune-

inflammatory diseases or epilepsy, people experiencing

osteoporosis-related fractures, people living with psoriatic

arthritis (PsA), and generalized myasthenia gravis (gMG). We

want to create value for patients in particular population subsets,

such as psoriasis patients developing psoriatic arthritis, where we

believe we can create real differentiation. These leadership goals

include advancing standards of care, improving the ecosystem

to improve quality of care, evolving patient share and building a

reputation for credibility, trust, loyalty, and legitimacy.

To deliver sustainable business growth and positive societal

impact, by 2025, we want to achieve:

At least € 6bn top line Low- to mid-thirties

adj. EBITDA margin

To be among the top rated

companies in ESG ratings

for our industry

We believe that deepening our

societal impact not only creates

value for our stakeholders but

also decreases our company’s

exposure to long-term

environmental, social and

governance (ESG) risk

111

We want to create value for patients in

particular population subsets, such as

psoriasis patients developing psoriatic

arthritis, where we believe we can

create a real differentiation

UCB | Integrated Annual Report 2022

112

ESG performance recognition

We believe that deepening our societal impact, by addressing

global challenges at the intersection of our expertise and

wider societal interests, not only creates value for our

stakeholders but also decreases our company’s exposure to

long-term environmental, social and governance (ESG) risks.

According to Sustainalytics, a leading ESG rating agency

indicating how a company is performing on key sustainability

topics and managing ESG risks, UCB’s score continues

improving year-over-year from 25.4 in 2020 to 16.8 in

2022 (low-risk level). This puts UCB in 3rd position of the

biotechnology sub-industry.

We also received a positive MSCI rating, improving from

A to AA and positioning UCB in the top quartile of the

pharmaceutical industry. This comes after improvements

in managing our ESG risks and reporting. It shows how

integrating a focus on ESG and extra-financial performance

continues to be key for UCB.

We also received a positive

MSCI rating, improving from

A to AA and positioning UCB

in the top quartile of the

pharmaceutical industry

Top 10% of

pharmaceutical

& biotechnology

industry

B for Climate

Change and

B for Water

Security

in 2022

3/443 of the

biotechnology

sub-industry

Above Belgium

companies'

average

UCB is a leader

(top quartile) in the

pharmaceutical

industry

113

UCB | Integrated Annual Report 2022

114

Our

Governance

We aim to maximize our positive societal

impact while supporting our strong financial

performance. We endeavor to conduct business

in a responsible way through our corporate

governance policies and procedures which shape

a strong culture of integrity and guide how the

organization operates.

115115

Ethical business practices are a core foundational element in driving

sustainable business growth for UCB. Delivering on our purpose

undoubtedly comes with new challenges and moments where our

ethics, unbiased judgment, and commitments may be tested.

Ethical Business Practices

We hold ourselves – and each other – to the highest standards,

striving to make decisions and choices that are focused on the

balanced interests of our stakeholders and acting with integrity

in all business dealings.

Our industry is subject to many complex rules, regulations, and

industry codes. UCB is committed to following all applicable

laws and regulatory requirements governing our activities. In

addition to meeting these obligations, we are guided by the

following ethical principles:

New UCB Code of Conduct: Our Ethics

in Action

Finalized in 2021 and rolled out in 2022, the new UCB Code

of Conduct reinforces the ethical principles and commitments

which must drive our decisions and actions. Available in

24 languages, the Code applies to all employees, agents and

consultants acting on behalf of UCB. We are responsible for

embodying our Code of Conduct, living by our commitments

to each other and our stakeholders.

LEARN MORE

The Code is publicly available and endorsed by UCB’s Executive

Committee and the Board. The Code is part of a set of

mandatory trainings carried out by all employees once per year.

This policy applies to all business relationships, and we ask third

parties acting on our behalf to complete the Code training so

they respect UCB’s values and principles.

The Code contains 26 commitments on various topics, such

as anti-corruption practices and anti-trust and fair competition,

owned by experts within the company. Each topic owner

develops policies, procedures, and tools to assist UCB

employees in operating in line with our company expectations,

and training is provided on all policies and procedures to the

relevant employees.

Trust is cultivated by our actions

Integrity is unconditional

Care is at the core

Transparency makes us stronger

Accountability powers our mission

100%

UCB employees that

completed the Code of

Conduct training

UCB | Integrated Annual Report 2022

116

1.1 Ethics & Compliance Program

UCB’s Ethics and Compliance (E&C) Program is built on the

established elements of compliance programs defined by

the U.S. Office of Inspector General and adapted based on

local country requirements. Elements include leadership and

governance; risk assessments and due diligence; standards,

policies, and procedures; training and communications; systems

for employee reporting; case management and investigations;

testing and monitoring; third party compliance and continuous

improvement.

Organizational Model

Compliance resources are divided between operational teams

focused on implementation, execution, measurement and

optimization, and business partner advisors helping teams to

navigate E&C elements as they implement business initiatives.

The organization is made up of 48 compliance professionals

with team members present at all UCB affiliates. Resources are

re-assessed regularly to ensure programs are staffed to support

UCB business needs, and additional contract resources are

utilized to provide specific expertise or to augment available

support when needed.

The Chief Ethics and Compliance Officer reports to the General

Counsel and has direct access to senior leadership including

the Executive Committee, CEO and Board, including annual

presentations to the Audit Committee of the Board.

Program Measurement

Monitoring activities and investigations provide important data

for E&C to assess the effectiveness of the program and drive

continuous improvement. Monitoring plans are developed

based on compliance risk assessments conducted annually by

each affiliate and aligned with the Global Internal Audit (GIA)

team to minimize duplication and flag concerns for elevated

awareness.

Data also helps identify trends to address in collaboration with

business leadership. Using dashboards and metrics, leaders

can provide ongoing coaching to their teams and demonstrate

leadership commitment to the importance of ethics and

compliance.

Vendors are reviewed during selection to assess risks related to

ethics and business integrity and may be subject to audit and

oversight from Ethics and Compliance or Internal Audit.

Speaking up and non-retaliation

Being accountable to preserve UCB’s reputation and the trust

patients and stakeholders put in our company is a core element

of the UCB mindset. Our leaders must create a trustful and

safe environment, which allows colleagues to step up, express

different opinions or ideas, engage in healthy debates and

challenge the status quo. We expect a speak-up culture where

we all stand up to ensure we do the right things in the right way

and feel accountable, comfortable and safe to question ideas

that are not aligned with our ethical principles.

If an employee sees something they consider could be illegal,

unethical or a behavior that contradicts the ethical principles

found in the Code of Conduct, they are expected to bring this

to the attention of a supervisor or manager. Employees may

also contact the Ethics & Compliance, local Talent (HR), or Legal

departments, or the 24/7 UCB Integrity Line. UCB also has a

strict non-retaliation policy that protects reporters, and retaliation

in any form is not tolerated.

In 2022, 51 internal investigations were conducted globally with

25 cases substantiated and 8 cases in progress. This resulted in:

Substantiated:

Warning letter

28%

Unsubstantiated:

No action taken

Substantiated:

No action

(employee

resigned)

19%

Termination

14%

Unsubstantiated:

Coaching

28%

Substantiated:

Coaching

UCB | Integrated Annual Report 2022

117

Managing incoming grievances

UCB has an established process for managing incoming

grievances, managed by an E&C Investigation Lead under

direction of the Chief Ethics and Compliance Officer. An

established impartial process is used to assess and investigate

all reports in a timely manner, and regular updates provided to

the reporter. For cases submitted anonymously, the reporter’s

identity is unknown to UCB, and the hotline is managed by a

third party. Investigation results are used to determine corrective

actions and any disciplinary actions. The process is also audited

by our Internal Audit team, and regular updates provided to

senior leadership.

Remaining informed about the trust in our

mechanisms

UCB is informed about the trust of our mechanisms in our

Ethical Culture and Compliance Perception Survey which

employees have the option to participate in anonymously each

year. This survey is conducted by a third party, Ethisphere, and

UCB receives response reports and a comparison to a peer

benchmark. The survey provides data on how colleagues see,

understand, live and apply ethical principles and behaviors.

There was a strong participation across all regions, with

47% of employee engagement. Overall survey score increased

from 2021 to 2022 by 1.4 points to 79.1%, driven by a noticeable

improvement in most areas. Results are used to support

our commitment to ensuring the program is dynamic and

responsive to the growing needs of our organization. Oversight

is further enforced through:

• Employee annual review: Employees are assessed on how

they met their objectives, including ethical business practice

considerations. Employees involved in compliance breaches

are subject to disciplinary action in alignment with UCB’s

disciplinary policy.

• Vendors review: Vendors are reviewed during the selection

process to assess risks related to ethics and business integrity

and may be subject to audit and oversight from Ethics and

Compliance or Internal Audit.

91.7%

of respondents agree

they have a personal

responsibility for making

sure UCB behaves ethically

91.3%

of respondents believe

their managers are

committed to ethical

conduct at all times

UCB | Integrated Annual Report 2022

118

The Ethical Leadership Award was created to recognize

employees in the U.S. who demonstrate the importance of

ethical behavior, maintain a constant focus on placing the

patient first, lead by example with integrity and care, and

always do the right thing even when it is difficult.

In 2022, over 20 nominations were received for peers and

leaders who exemplified how they put our ethical business

practices into action in 2021. Nominations were blinded and

reviewed by a cross-functional team, with finalists assessed

by the U.S. leadership team. Winners were invited on the

Pinnacle Award trip and all finalists received a certificate

recognizing their accomplishments and nomination.

Highlighting the importance

of ethical leadership

Spotlight:

“I am truly honored to have

been nominated for the Ethical

Leadership Award. Ethics and

Compliance is paramount

in what we do each and

every day for the betterment

of the company and, most

importantly, the patients. We,

at UCB, will continue to thrive

with that mindset. Thank you

so much for your continued

leadership and efforts in

setting the foundation and

helping us to build and improve

our actions in Ethics and

Compliance!”

Award Winners 2021

Nominator said:

“Brad is widely recognized throughout the organization as an

aggressive advocate for patients and caregivers, a champion

for the less-heard voices among UCB colleagues and reports,

and tireless promoter of ethical principles of professional

behavior.”

Ethical Leadership

Award Winner

Brad Chapman

US Neurology

Nominator said:

“He provides relevant business content and inspires us to

develop ethical action plans, so that we understand how the

team is returning value to the business. He is authentic and

inclusive with the team and this allows team members to

communicate honestly and openly with him.”

Ethical Leadership

Award Winner

Fernando Gonzalez-Moro

Global Procurement Organization

UCB | Integrated Annual Report 2022

119

Competition and antitrust

UCB remains committed to full compliance with all laws and

regulations related to anti-competitive behavior, antitrust or

monopoly. Our Global Antitrust Policy was revised in 2021 and

additional global guidelines were introduced. We have also

released a new set of e-learnings on EU Competition Law. In

2022 there were no material actions or litigations associated

with UCB.

1.2 Anti-Bribery and Anti-Corruption (ABAC)

The UCB Code of Conduct encompasses, amongst others,

core principles and behaviors aiming at mitigating the risks

related to bribery and corruption. Considering the nature of

our business, UCB identified our engagement of the healthcare

stakeholders as the primary Anti-bribery/Anti-corruption (ABAC)

risk area. ABAC risks are reported in the Risk Management

section of this report. In the last quarter of 2022, UCB launched

a new ABAC policy and training, which outlines key anti-

corruption and anti-bribery principles, supported by additional

procedures and guidelines that describe how we detect,

prevent, and mitigate bribery and corruption risks in our business

activities. As of December 31, 2022 93% of employees had

completed the training on the new policy. This is a mandatory

annual training for all employees and full year training data will

be reported in the 2023 integrated annual report. In 2022, no

material cases of bribery or corruption were reported.

The Global Internal Audit department periodically audits UCB’s

global operations for potential risks related to these areas in

accordance with an established rotational schedule or on

an issue basis where appropriate. As part of their approved

Audit Plan for 2022, the Global Internal Audit department has

performed 28 reviews of various sites/affiliates/partners which

includes, among others, an assessment of ABAC procedures

and controls. They continuously monitor, enforce, and follow

up on any compliance-related findings.

The local Ethics and Compliance officer conducts a risk

assessment for every market where UCB operates to assess

local risks related to several topics, including corruption. These

risks, when identified, are addressed through a mitigation plan

developed with local leadership teams and reported to the

global E&C leadership team.

1.3 Human Rights

UCB takes the necessary steps to promote and encourage high

ethical standards of working and fair treatment of human beings.

We have a zero-tolerance approach to any form of human

rights abuses, including forced or child labor, modern slavery,

or human trafficking. UCB and all colleagues are required to

comply with all applicable laws and to respect human rights

and act with diligence to avoid infringing on the rights of others,

as expressed by the International Bill of Human Rights and the

principles set out in the International Labour Organization’s

Declaration on Fundamental Principles and Rights at Work.

UCB respects the human rights of workers and ensures that

employees are treated with dignity and respect. UCB colleagues

should notify their manager or report via Hotline/Helpline or

the UCB Integrity Line of any adverse impacts involving the

company, colleagues, or contractors. Human rights risks are

reported in the Risk Management section of this report.

Considering the nature of our operations, due diligence for

our third-party relationships is also a part of our Ethics and

Compliance Program. UCB expects the same behavior from

consultants and others acting on behalf of UCB (supply chains,

i.e., purchasing of goods and services). UCB monitors our

relationships with third parties, since this is the area where

risks related to Human Rights are most likely to materialize,

particularly in countries where we operate which may be

regarded as higher risk.

Any interactions with third parties are analyzed to ensure that

there is a need to engage with the third party and that activities

are performed in an ethical way by partners. This includes

reviewing any efforts third parties may take to conceal unethical

actions such as bribes to foreign officials or other international

business transactions. It also includes a review of compensation

standards for industry/geographic region as well as tracking

those third parties that do not meet our due diligence standards.

Our Code of Conduct, a robust due diligence process and

audits conducted by our Global Internal Audit team aim to

mitigate these risks.

93%

of employees completed

the ABAC training

UCB | Integrated Annual Report 2022

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Our performance on human rights

We have embarked on a journey to expand our efforts and

make continued progress to respect human rights within our

operations and throughout our supply chain. In 2022, we

started a process to further implement requirements of the

United Nations Guiding Principles on Business and Human

Rights (UNGP). We set up a multidisciplinary group in charge

of reviewing our human rights systems policies and processes

and of identifying risk areas where rights holders’ rights could

be potentially infringed. A new human rights policy will be

communicated and implemented in 2023.

To date, no report of an infringement of human rights

associated with UCB or its suppliers has been identified to

the company.

1.4 Product Responsibility

UCB takes the safety of our products seriously and has an

internal process to oversee the review of safety information

for medicines in development by UCB as well as for our

products. The Global Labeling Committee reviews the labeling

of all UCB drugs.

This Committee ensures that labeling:

1. meets country regulations relative to safety, efficacy, and

quality of drugs as well as the accuracy of the product

information provided pursuant to their regulation,

2. reflects appropriately and understandably information about

drugs and the safety profile for patients and physicians

3. in the manufacturing country is identical for patients and

physicians in countries to which the same drug is exported.

UCB prohibits off-label promotion of its products. UCB also

has a robust internal review process for materials intended for

external use, including reviews by Legal, Regulatory Affairs and

Medical colleagues to confirm that content meets internal and

external requirements related to promotion and other types of

external communications. This process is assessed as part of

the annual risk assessment conducted by E&C and audits are

conducted as needed. The Internal Audit team also audits the

process to confirm that the required reviews are conducted. All

employees receive training via the Code of Conduct and other

local trainings to ensure that prohibitions on off-label promotion

are understood.

1.5 Ethical Marketing

UCB only promotes drugs in accordance with laws, regulations,

and industry codes applicable to that country. There is oversight

that promotion of drugs is accurate, fair, objective, meets

the highest ethical standards, and conforms to local legal

requirements. Claims must reflect the latest up-to-date scientific

evidence warrants and be deprived of ambiguity. Promotional,

press and scientific communication relating to our compounds,

products and disease are submitted to the global or local

committees, with members duly trained. UCB does not sell

any products that are banned in a market and all UCB products

comply with drug regulatory and safety requirements.

UCB adheres to all applicable country laws, regulations and

industry codes, the CIOMS/WHO recommendation derived

from the WHO Ethical Criteria of Medicinal Drug Promotion, the

Directive of the European Parliament and of the Council on the

Community Code relating to medicinal products for human use,

as well as the EFPIA (European Federation of Pharmaceutical

Industries and Associations), IFPMA (International Federation

of Pharmaceutical Manufacturers & Associations) and PhRMA

(Pharmaceutical Research and Manufacturers of America)

codes, among others.

UCB closely regulates interactions and engagements with

healthcare professionals. These requirements are covered in

the Code of Conduct and global and local policies, ensuring

that requirements are integrated into all UCB business practices.

UCB also has a robust set of internal controls to ensure any

engagement with healthcare professionals is conducted

in accordance with applicable rules and regulations, and

ethically. This process is assessed as part of the annual Ethics

and Compliance risk assessment and monitoring plan. The

Internal Audit team also audits the process to confirm that the

required reviews and conducted. All employees receive training

via the Code of Conduct and other local training to ensure

that requirements related to engagements with healthcare

professionals are understood.

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121

Engaging with the Risk @ UCB community (i.e. key

representatives from all operational, functional, and strategic

business areas), “bottom-up” risks are identified and assessed

by each business area and the respective leadership team. In

addition, a “top-down/outside-in” assessment is conducted to

complete a holistic risk profile. To maximize the impact, top

risks are connected to the strategic priorities. An understanding

of how the risk is trending and how well UCB is prepared to

respond is communicated to and discussed with our Executive

Committee, Audit Committee and our Board of Directors.

This year, there were increased efforts to provide detailed risk

analysis and evaluation, by including finance colleagues in the

financial quantification process to better assess the potential

financial impact of risks. The potential ESG and reputational

impact are also part of the risk scoring process.

An Environmental, Social & Governance category has been

integrated in the framework and process, thus ensuring

sustainability risks are also covered.

Risk Management

2.1 Our approach to risk management

Within Enterprise Risk Management at UCB, we maintain our

commitment to our purpose, strategy and sustainable approach

and seek to find new ways to manage risks and deliver impact

in an increasingly volatile, complex, fast moving and ambiguous

environment. Our approach is to educate, connect and enable

all stakeholders throughout UCB to integrate key, vertical

and transversal risk identification, assessment, and response

planning. By analyzing potential risk exposure, decisions can be

made in a more informed manner.

In 2022, the core focus was to strengthen our connection to the

corporate strategy as we seek to empower business leaders to

calibrate risks at the right level and integrate risk considerations

into their decision making. We did so by continuing to enhance

the interfaces between strategic planning teams, enterprise risk

management, business stakeholders and external risk experts

and networks. We also further advanced our understanding of

both internal and external emerging uncertainties.

2.2 Process and framework

The risks we face are evolving, thus our approach to

management of risk is dynamic, allowing for new or changed

risks to be assessed and reassessed throughout the year.

Business leaders’ ability to manage risk is underpinned by access

to a clear framework, tools and support. In 2022 we launched

a centralized global risk register system and the Risk @ UCB

online resource center, available to all employees seeking risk

management information and support.

We operate a four-step framework:

Risk Identification

Risk Analysis & Evaluation

Risk Response

Define response strategy

Define response plan

Execute & Monitor

Risk Closure

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122

Governance and oversight

UCB continues to demonstrate its commitment to managing

uncertainty by creating accountability at the top and driving

action by the business. Ownership and accountability for risk

at each level sits with the relevant leadership team and every

top risk is overseen by a member of the Executive Committee

who is accountable for understanding the nature of the risk and

enabling our response to it.

Risk Management @ UCB

In 2022, we drove progress by presenting a risk mapping of the

enterprise risks to the Audit Committee earlier in the process

and incorporating their feedback into the prioritization of the 13

risks selected for the ExCom and Board reporting.

Going forward, we will use the new tools launched in 2022 to

enhance risk management (including identification, assessment,

monitoring and reporting) and provide a transversal overview

of risks impacting UCB’s business units. We will also continue

enhancing the risk mindset and learning experience with

additional guidance and training.

Risks can be triggered by... ... and impact and feed...Accountability and Oversight

Level 1

Level 2

Level 3

Enterprise

Risks

Business Unit or a

Transversal Function risks

Departmental/Site/

Regional Risks

Regulations

Project Plans

Strategic

Plans

Market

trends

Society

Objectives

Geopolitics

Sustainability

Environmental

Annual report

Board & Audit

Committee

EXCOM

Corporate

Leadership

Team

Local

Leadership

Team

ESG ratings

UCB strategic

choices

Internal

execution

Continuous

Improvement

UCB | Integrated Annual Report 2022

123

Top Risk Identified UCB’s response

Competition from biosimilars, generics and new

drug classes

Biosimilar and generic entrants and their market impact are

increasing globally. In parallel, the launch of new classes of

biologic-based drugs contribute to the rich complexity of the

biologics market.

UCB supports increasing innovation and access to biologics

by investing in value-add propositions in target patient

populations. We are vigilant to ensure our pipeline will bring

new growth opportunities as we need to compensate for the

impact of generics/biosimilar launches of commercialized

products. As an innovative company, we aim for superior

patient outcomes, influenced by a deep understanding

of patient and regulatory stakeholder needs. We believe

that generic and biosimilar medicines are important for

sustainable health systems. UCB supports the development

and marketing of biosimilars in a science-based approach,

including head-to-head studies of originator vs biosimilar

therapies and promotion based on scientifically

accurate education.

Intensity of successive product launches

UCB continues to pursue and invest in highly differentiated

drugs focusing on the needs of well-defined populations.

Our next wave of new solutions may come in rapid

succession, creating a need for clear value messaging

and launch agility. Upcoming launches will need to be

effectively managed.

UCB is matching its capabilities and reallocated resources

and talents in an agile way to optimize launch success

in a fast moving and changing environment, including

managing the impact of bimekizumab

delay. Leadership and

capabilities will continue to evolve in line with our strategy,

with the development of innovative and adaptive capacity of

all leaders and teams.

Business disruption from geopolitical challenges, the

energy crisis and inflation

The increasing inflation trend is anticipated to continue,

exacerbated by:

• Energy prices continuing to increase

• Salary indexation in Belgium and other countries (fixed by

the government); and

• Current geopolitical environment (post-pandemic, impact

of war in Ukraine, etc.)

We are facing potential energy shortages and/or energy

affordability challenges that could lead to activity disruption

internally and/or at our suppliers.

Government budget constraints in the healthcare sector,

further exacerbated by the current external environment,

could negatively impact UCB.

UCB is closely tracking energy price trends and inflation

forecasts, as well as the evolution of the current geopolitical

environment. We continue to monitor vendor signals and

implement case by case negotiation with external suppliers.

In addition, UCB is driving further efficiency in its operation

model and leveraging a transversal crisis management

committee to accelerate decision making and our response

to potential business disruption.

2.3 Top risks in 2022

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Top Risk Identified UCB’s response

Global pricing and access challenges

Pharmaceutical pricing continues to be under scrutiny, with

global payers, both government and private, looking for

means to reduce costs. Payer strategies include downward

pricing pressure, rebate considerations, increase in out-of-

pocket costs to patients, and access restrictions.

UCB is actively engaging in collaboration with payer and

industry associations to enable the best access for patients

while promoting sustainable solutions that make a material

difference across the globe. Our executive and leadership

team-level committees monitor and engage with the U.S.

policy ecosystem to continue to deliver on our vision of

making a difference for people living with severe diseases.

Cybersecurity/big data and artificial intelligence

The threat has been on the rise for several years and

continues to evolve upwards. Our world is increasingly

dependent on the evolving digital landscape to meet

today’s goals and to create new paradigms for the future.

Cybersecurity and data privacy in all forms is of utmost

importance to UCB, as breaches and disruptions can cause

reputational, financial and operational damage. Artificial

intelligence (AI) is changing the way we live and interact, with

the experience already gained at UCB in the AI space, we are

constantly reviewing how this can play a role in our patients’

lives and in how we do business.

UCB has a multifaceted cybersecurity and data

management strategy, along with active programs for the

proper prevention, detection and response controls. This

includes continuous monitoring and analytics, intrusion

incident detection and response, security testing and user

awareness training and campaigns. Additionally, UCB has

a Cyber Crisis program that allows us to properly handle

large security incidents (e.g. data breach or malware). In

2022, following a global trend, the number of potential data

breaches including IT security increased. Approximately 15%

of potential breaches identified by UCB were related to IT

security, of which one was notified by UCB as data controller

to the Belgian Data Protection Authority, as required by

Article 33 of the GDPR. However, none of these incidents

resulted in high risk to the rights and freedoms of the data

subjects concerned. UCB has established robust processes,

procedures and controls to continue to comply with the

GDPR legislation as the gold standard for privacy and data

protection. In addition, we liaise with regulators and industry

associations to remain abreast of developments as this

dynamic area continues to evolve. Ethical reviews will be an

integral part of any relevant AI project at UCB.

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Social Risks

Top Risk Identified UCB’s response

Social risks

The economic and operational disruption of the pandemic

has caused significant upheaval in the global labor market. In

a highly specialized industry, rising competition for talent and

persistent skills shortages have the potential to impact UCB’s

daily operations and strategic growth plans. This includes

the risk of not being able to provide adequate compliance

training to employees, being unable to provide a healthy and

safe environment where employee wellbeing is adequately

supported or promoted, or where workplace dangers are

not managed or sufficiently outlined. These risks could lead

to sub-optimal results and/ or safety incidents or sub-optimal

health of employees, both physical and mental.

The Talent department manages the Workforce

Engagement policy, and the policy is continuously improved

by different processes, including:

• Robust annual human resources processes to optimize

talent development opportunities including employee

development discussions with adequate and continuous

employee learning opportunities; continuous employee

performance reviews, including an articulation of expected

values and behaviors,

• Regular review of the total reward offering to ensure

balanced, competitive remuneration to drive outcomes

aligned with the company strategy and to ensure the

employee and their family are adequately covered during

key life events,

• Periodic employee engagement surveys that enable UCB

and its leadership to respond to employee feedback on

their employment experience,

• Working practices in line with data privacy requirements

(GDPR),

• Various health, wellbeing and safety policies as per our

sustainability commitment, as well as remote and flexible

work policies.

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Top Risk Identified UCB’s response

Anti-bribery/Anti-corruption (ABAC) risks

In line with our sustainable business approach, UCB is

committed to conducting business in accordance with

the highest ethical standards and all forms of bribery and

corruption are prohibited. This includes offering, promising,

authorizing or providing anything of value (directly or

indirectly) to any customer, business partner, vendor or

other third party in order to induce or reward the improper

performance of an activity connected with our business. This

includes interactions with government officials or individuals

in the private sector.

Bribery and extortion are illegal everywhere, and UCB and

its colleagues will not engage in it. That includes the receipt

of bribes that would or might cause a UCB colleague to

violate his or her duty of loyalty to UCB. All UCB colleagues

must comply with all applicable antibribery laws worldwide.

Violations of these laws can result not only in the loss of

business but also may lead to severe criminal and civil

penalties for UCB and the individuals involved.

Human rights risks

UCB is committed to conducting business in accordance

with the highest ethical standards and respecting human

rights in all that we do. UCB respects the human rights of

workers and ensures that employees are treated with dignity

and respect.

UCB and its colleagues are required to comply with all

applicable laws and to respect human rights and act with

due diligence to avoid infringing on the rights of others, as

expressed by the International Bill of Human Rights and the

principles set out in the International Labour Organization

Declaration on Fundamental Principles and Rights at Work.

UCB expects the same behavior from consultants and others

acting on behalf of UCB. Respecting Human Rights is the

responsibility of everyone.

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127

Environmental and Climate Risks

Top Risk identified UCB’s response

Physical risks

As a result of the scenario analysis conducted, water scarcity

and heavy precipitation and flooding were determined to

be the risks with the highest potential material impact to

UCB’s operations, including offices, research labs, and key

suppliers. The increase in the severity and/or frequency

of these risks is projected to happen in the medium

(2030) and long-term (2050) under a high emission, low

mitigation scenario.

To a lesser extent, UCB could also experience impacts due

to an increase in the frequency and/or severity of extreme

temperatures, hurricanes, hailstorms and wildfires which has

not been considered as a material risk for UCB’s business.

UCB has in place several measures aimed at limiting the

potential impact of these key risks, as well as other natural

risks, across its operations:

• Insurance from natural hazards, including hailstorms,

hurricanes, and heavy precipitation and flooding, covering

all assets of the group (building, equipment, stocks) both

for UCB and CMOs/suppliers.

• Dual internal/external sourcing to produce key APIs.

• An 80-90% use rate target of key plants to leave reserve

capacity for unforeseen events that may cause interruption

of operations at external suppliers.

• Local mitigation measures to limit the impact of flooding

at potentially affected facilities, including those of suppliers.

These include evacuation and flood protection plans,

underground tanks and pipes to stop water from flooding

key buildings, and water pumps in case infiltration occurs,

in addition to flood protection measures built by local

authorities such as walls and dikes.

• Key suppliers are requested to submit a business continuity

plan addressing mitigation of climate risks.

• Every new UCB building or major revamping of UCB

buildings and its premises is certified with either BREEAM

(EU) or LEED (rest of the world), green building certification

systems that take into consideration climate resilience.

Measures to tackle the risk of water scarcity only:

• Planned implementation of a water recycling system at key

facilities

• Possibility to increase water purification technologies as

deemed necessary

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128

Top Risk identified UCB’s response

Transition risks

As a result of the scenario analysis conducted, the increase

in carbon pricing and the possible shift in market toward

less carbon-intensive products were determined to be

the risks with the highest potential material impact on

UCB’s operations. These risks have been analyzed in two

different scenarios from the International Energy Agency,

the SDS (well below 2°C) and the STEPS (well above 2°C)

scenarios, to assess the potential financial impact on UCB’s

business (EBITDA).

UCB has put in place several measures to limit the potential

impact of these key risks in its operations. Additional

measures are being assessed for the upcoming years.

Measures to tackle the risk of carbon pricing:

• Planned decrease in Scope 1 and 2 emissions through

pursuing an SBTi target, implementing production

processes based on 100% renewable energy by 2030,

shifting to electric vehicles for UCB car fleet, optimizing

energy consumption by making our operations more

energy efficient, etc.

• Planned decrease in Scope 3 emissions through supplier

engagement (aligned with SBTi target), a shift from air to

ocean for the logistics of our raw materials and finished

goods, the possibility to store and ship bio product at -40°C

instead of -60°, the reduction of commuting and business

travel thanks to our new ways of working, etc.

• Individual objectives are defined according to the extent

to which annual objectives have been met, climate target

being one of UCB corporate objectives.

• The CEO’s individual objectives mainly represent the overall

company objectives, covering both financial and extra-

financial priorities including UCB’s climate ambition.

Measures to tackle the market shift towards less carbon-

intensive products:

• UCB’s Green Product Scorecard initiative is based on a

systematic “cradle-to-grave” lifecycle analysis, allowing us

to assess impacts and hotspots, and map opportunities

for environmental footprint reductions/avoidance

from development to commercialization. For example,

increasing the usage of energy generated from renewable

sources, either produced at UCB’s sites or purchased (on

a percentage basis), increasing the % of recycled solvents

where possible and the use of greener solvents, and

intensifying supplier engagement regarding emissions

reduction throughout the production value chain.

• Increased number of bioproducts into our product

portfolio and exploration of gene therapy, which are

generally less carbon intensive than pharmaceutical

products when considering the patient treatment as

reference unit.

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Dear Reader,

As another year comes around, I write to

bring you some of the highlights from

the past twelve months by way of

introduction to the Corporate

Governance section of the 2022

Integrated Annual Report. 2022 was a year

where UCB continued to face challenges,

both external and internal. Yet while the company has navigated

complex and demanding markets, it has also driven a clear

alignment as to how we should adapt for the future.

Our employees’ unwavering resilience must be recognized

in this respect. The tireless efforts placed on achieving the

submission, resubmission and launch of BIMZELX

*, as well

as the integration of Zogenix, Inc and the management of six

ongoing clinical phase 3 trials taking place, are testament to

what we can achieve. These are remarkable accomplishments

which provide a most promising outlook for UCB despite some

turbulence along the way. On this point, I would like to thank

all our stakeholders for believing in our vision and for their

constant support.

In terms of UCB’s governance, while we saw the recent

departure of our Chair of the Board, Dr. Stefan Oschmann,

for personal reasons, the past year has seen a large amount

of consolidation for the Board. Naturally, a sharp focus will be

placed on succession planning both at Board and executive

levels given this recent departure, with a particular emphasis on

selecting the replacement of the Chair.

The External Sustainability Advisory Board (“ESAB”) experience

continues to advance most successfully, and we look forward

to enhancing the direct interactions between our Board and

the ESAB in 2023. Likewise, we hope to involve our Audit

Committee even further in the oversight of extra-financial

information, including our reporting frameworks, KPIs and

auditing.

It is important for us to regularly get feedback on the functioning

of our board and identify further areas for improvement.

End of 2022 presented the perfect moment to reflect on

the functioning of the Board. A thorough Board assessment

was carried out. The exercise was managed by an external

consultant and allowed us to review not only today’s

effectiveness of the Board and its committees, but also to

validate the evolving needs of the company over the coming

years. This endeavor included benchmarking and examining

considerations of additional skills, diversity and composition

for the future. It also evaluated the general effectiveness of

the Board and its committees. The overall conclusion of the

assessment was that we have a high quality and high performing

Board which puts us in a good position to continue growing

and further develop the work we have already started.

At the same time, in 2022 we continued to make important

strides on our sustainability journey. By building sustainability

further into our governance, into impact measurement and

performance disclosure, and by engaging our colleagues,

we made great progress. We continued to hold valuable

interactions with our stakeholders through our ESG roadshows

held in March and November, gaining insights into their priorities

for our governance and sustainability goals as a company and

sharing our exciting journey and improvements.

For 2023 and beyond, we see a truly exciting future ahead for

our stakeholders and for UCB. As we have seen over the past

year, we must acknowledge that our ecosystem and the wider

environment is increasingly complex. This will require constant

reflection on our ability to navigate these volatile times so that

we can consistently serve all stakeholders effectively, now and

in the future.

FIONA DU MONCEAU

Chair of the GNCC

Introduction letter from the Chair of the Governance Nomination and Compensation Committee

Corporate Governance Statement

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

UCB | Integrated Annual Report 2022

130

3.1 Scope of reporting

As a Belgian company listed on Euronext Brussels, UCB SA/

NV (“UCB”) is committed to the highest standards of corporate

governance and is required by Belgian law (in particular Article

3:6

of the Belgian Code of Companies and Associations or

the “BCCA”) to apply the 2020 Belgian Code on Corporate

Governance

or the “2020 Code”, which are both applicable

since January 1, 2020.

The 2020 Code is based on the “Comply or Explain” principle.

Belgian company law and the Belgian Code on Corporate

Governance require UCB to adopt and publish a Charter of

Corporate Governance and, on an annual basis, a Corporate

Governance Statement, to be included in its (Integrated)

Annual Report.

The Board of Directors of UCB (the “Board”) has established a

Corporate Governance Charter (the “Charter”) since 2005. It

describes the main aspects of corporate governance at UCB,

including its governance structure, its shareholding, the terms

of reference of the Board and its committees as well as those

of its Executive Committee, and the rules applicable to its

shareholder meetings. The Charter is updated from time to

time and annually reviewed by the Board to be in line with the

applicable laws and regulations, the relevant Code on Corporate

Governance, international standards, and the evolution of UCB.

The latest version of the UCB Charter is available on the UCB

website. In accordance with principle 1.3 of the 2020 Code,

UCB is to inform of any material amendments made to the

company’s corporate governance Charter. It is confirmed that

no material changes were brought to the UCB Charter in 2022.

As required by the BCCA and the 2020 Code, UCB also

publishes every year as part of its (Integrated) Annual Report

a Corporate Governance Statement, which includes all

information required by law as well as a description of how the

2020 Code has been applied in the last reporting year and, if

applicable, an explanation of any deviations to the provisions

of this Code (application of the comply or explain approach).

This section of the (Integrated) Annual Report constitutes the

Corporate Governance Statement for the year 2022.

3.2 Capital and shares

3.2.1 Capital

The capital of UCB has not been modified in 2022. On

December 31, 2022, it amounted to € 583 516 974 and was

represented by 194 505 658 shares.

Since March 13, 2014, the share capital of UCB is represented by

194 505 658 shares, all fully paid up (“UCB shares”).

3.2.2 Shares

UCB shares may be in registered or dematerialized form, at the

request of the shareholder, in accordance with the BCCA.

Pursuant to the Belgian Law of December 14, 2005, bearer

securities have been subject to a gradual abolishment, leading

to their conversion into registered or dematerialized securities

as from January 1, 2014, a mandatory sale of outstanding bearer

shares by the Company in June 2015 and their complete

abolishment at the end of 2015.

As of January 1, 2016, the rightful owners of unclaimed

bearer shares have the right to claim the payment of the

corresponding net proceeds of the mandatory sale from the

Belgian Deposit and Consignment Fund (“Caisse des Dépôts

et Consignations“/“Deposito- en Consignatiekas“) subject to

evidence of their valid title to the shares and subject to a fine of

10% of the proceeds of the sale of the underlying bearer shares

per each commenced year of arrears. More details are available

on UCB’s website.

Registered UCB shares are recorded in the share register of

UCB. All UCB shares are admitted for listing and trading on

Euronext Brussels. Each share gives right to one vote (“one share

one vote” principle).

The Annual General Meeting is competent to allocate the

results of each financial year. In-line with UCB’s long-term

dividend policy, the Board proposes a gross dividend of

€ 1.33 per share (2022: € 1.30). If the dividend is approved by the

Annual General Meeting on April 27, 2023, the net dividend of

€ 0.931 per share will be payable as of May 3, 2023 against the

delivery of coupon #26.

1 Article 3:6 of the BCCA refers to the Royal Decree dated May 12, 2019 on the applicability of the 2020 Belgian Code on Corporate Governance to listed companies.

2 The “2020 Belgian Code on Corporate Governance” is available on the website of the Belgian Corporate Governance Committee: 2020 Belgian Code on Corporate

Governance | Commissie Corporate Governance (corporategovernancecommittee.be)

UCB | Integrated Annual Report 2022

131

3.2.3 Treasury shares

In accordance with article 12 of the Articles of Association of

UCB (the ‘Articles of Association’), the Extraordinary General

Meeting of April 28, 2022 decided to renew, for a period of

2 years starting on July 1, 2022 and expiring on June 30,

2024, the authorization granted to the Board of Directors to

acquire, directly or indirectly, whether on or outside of the stock

exchange, by way of purchase, exchange, contribution or any

other way, up to 10% of the total number of the Company’s

shares, as calculated on the date of each acquisition, for a price

or an exchange value per share which will not be (i) higher

than the highest price of the Company’s shares on Euronext

Brussels on the day of the acquisition and (ii) lower than one (1)

euro, without prejudice to article 8:5 of the royal decree of April

29, 2019 implementing the Belgian Code of Companies and

Associations. As a result of such acquisition(s), the Company,

together with its direct or indirect subsidiaries, as well as persons

acting on their own behalf but for the account of the Company

or its direct or indirect subsidiaries, may not hold more than

10% of the total number of shares issued by the Company at

the moment of the acquisition concerned. This authorization

extends to any acquisitions of the Company’s shares, directly or

indirectly, by the Company’s direct subsidiaries in accordance

with article 7:221 of the BCCA.

In 2022, UCB SA acquired 500 000 UCB shares and disposed

of 921 021 UCB shares. On December 31, 2022, UCB SA held

a total of 4 910 760 UCB shares representing 2.52% of the total

number of UCB shares, and no other UCB securities. The UCB

shares were acquired by UCB SA in order to cover part of UCB’s

obligations resulting from the employees’ stock option plans,

stock award plans and performance share plans. None of UCB

SA’s affiliates is holding UCB shares on December 31, 2022.

3.2.4 Authorized capital

The Extraordinary General Meeting of April 28, 2022 decided to

renew the authorization to the Board (and to amend the Articles

of Association accordingly), for a period of 2 years, until May 23,

2024, to increase the share capital, amongst other by way of

the issuance of shares, convertible bonds or warrants, in one or

more transactions, within the limits set by the BCCA.

1. with up to 5% of the share capital calculated at the time of

the decision of the Board to make use of this authorization, in

the event of a capital increase with cancellation or limitation

of the preferential subscription rights of the shareholders

(whether or not for the benefit of one or more specific

persons who are not employees of the Company or of its

subsidiaries);

2. with up to 10% of the share capital calculated at the time of

the decision of the Board to make use of this authorization,

in the event of a capital increase without cancellation or

limitation of the preferential subscription rights of the existing

shareholders.

In any event, the total amount by which the Board may increase

the share capital by a combination of the authorizations set

forth in (1) and (2) above, is limited to 10% of the share capital

at the time of the decision of the Board to make use of this

authorization.

The Board is moreover expressly authorized to make use of this

mandate, within the limits as set out under (i) and (ii) above, for

the following operations:

1. a capital increase or the issuance of convertible bonds or

warrants with cancellation or limitation of the preferential

subscription rights of the existing shareholders,

2. a capital increase or the issuance of convertible bonds or

subscription rights with cancellation or limitation of the

preferential subscription rights of the existing shareholders

for the benefit of one or more specific persons who are not

employees of the Company or of its subsidiaries, and

3. a capital increase by incorporation of reserves.

Any such capital increase may take all forms, including but not

limited to, contributions in cash or in kind, with or without share

premium, with issuance of shares below, above or at par value,

the incorporation of reserves and/or share premiums and/or

profits carried forward, to the maximum extent permitted by

the Law.

Any decision of the Board to use this authorization requires a

75% majority within the Board.

The Board is empowered, with full power of substitution, to

amend the Articles of Association to reflect the capital increases

resulting from the exercise of its authorization.

The BCCA does not allow the use of this authorization as of

the moment the Company has been notified by the Financial

Services and Markets Authority (the “FSMA”) about a public

takeover bid.

At December 31, 2022, the Board did not make use of this

authorization.

UCB | Integrated Annual Report 2022

132

3.3 Shareholders and shareholders’ structure

3.3.1 Reference shareholder

The main shareholder of UCB SA is Financière de Tubize SA (also

referred to herein as the “Reference Shareholder” or “Tubize”), a

Belgian company listed on Euronext Brussels, holding

69 440 861 UCB shares on a total number of 194 505 658 (i.e.,

35.70 %) as at December 31, 2022.

Based on the most recent public disclosure made by Tubize,

the shareholder structure of Tubize per December 31, 2022 was

as follows:

Concert Outside concert Total

Voting Rights % Voting Rights % Voting Rights %

FEJ SRL

   .%    .%    .%

Daniel Janssen

   .% - -    .%

Altaï Invest SA    .%   .%    .%

Barnfin SA    .% - -    .%

Jean van Rijckevorsel   .% - -   .%

Total voting rights held by

the reference shareholders

   .%    .%    .%

Other shareholders - -    .%    .%

Total voting rights    .%    .%    .%

Altaï Invest SA is controlled by Evelyn du Monceau, born Evelyn

Janssen. Barnfin SA is controlled by Bridget van Rijckevorsel,

born Bridget Janssen.

The shareholders of Financière de Tubize SA, belonging to

the Janssen family, act in concert, i.e. they have entered into

a shareholders’ agreement of which the key elements are

summarized as follows, based on publicly available information:

• The objective of the concert is to ensure, through Financière

de Tubize SA, the stability of the shareholder structure of UCB

in view of the long-term industrial development of the latter.

In this perspective, it aims to preserve the predominance of

the family shareholder structure of Financière de Tubize SA.

• The parties to the concert consult with each other about the

decisions to be taken at the general meeting of Financière

de Tubize SA, and try, to the extent possible, to reach a

consensus. They ensure that they are properly represented

in the Board of Directors of Financière de Tubize SA. Within

this Board and through their representatives at the Board of

Directors of UCB, they consult with each other about the

significant strategic decisions concerning UCB, and try, to the

extent possible, to reach a consensus.

• The parties inform each other prior to any project of

significant acquisition or sale of shares of Financière de Tubize

SA. Pre-emption rights and rights of resale are also in place

within the family.

In accordance with rule 8.7 of the 2020 Code, “the Board

should debate whether it would be appropriate for the

Company to enter into a relationship agreement with the

significant or controlling shareholder.” The Board is of the

opinion that there is currently no need for establishing a

relationship agreement. The Corporate Governance Charter of

UCB, the current composition of the Board and the rules of the

BCCA provide a sufficiently clear frame to the Board and the

Reference shareholder. In addition, the Reference Shareholder

of UCB is itself a listed company and as such subject to

extensive disclosure obligations.

UCB | Integrated Annual Report 2022

133

3.3.2 Transparency notifications

During 2022, UCB received the following transparency

notifications in accordance with the law of May 2, 2007 on the

disclosure of large shareholdings:

UCB received transparency notifications from FMR LLC. dated

January 31, March 16, May 23, 24 and August 3, 2022. In the

latest transparency notification dated August 3, 2022, FMR LLC.,

notified that, following an acquisition of UCB shares with voting

rights by its affiliates, the shareholding of a controlled entity

decreased and crossed downwards the 3% threshold, on August

1, 2022. On August 1, 2022, FMR LLC. (taking into account the

holding of its affiliates) owned 7 509 016 UCB shares with voting

rights, representing 3.86% of the total number of shares issued

by the company (194 505 658), versus 4.99 % (9 698 901 UCB

shares) in the previous notification dated May 24, 2022.

Also, UCB received a transparency notification from Wellington

Management Group LLP, dated May 16, 2022. Wellington

Management Group LLP notified that, following a disposal of

UCB shares with voting rights by its affiliates, its shareholding in

UCB SA increased and crossed the threshold of 7.5% on May 13,

2022. On May 13, 2022, Wellington Management Group LLP

(taking into account the holding of its affiliates) owned 15 166

845 UCB shares with voting rights, representing 7.80% of the

total number of shares issued by the company (194 505 658),

versus 7.46% (14 516 633 UCB shares) in the previous notification

dated September 2, 2021.

All these notifications can be found on UCB’s website.

3.3.3 Relationship with and between shareholders

Please refer to Note 44.4 for an overview of the relationship

of UCB with shareholders. Furthermore, UCB is not aware

of any agreements between its shareholders, apart from the

information mentioned below.

UCB has received notifications pursuant to article 74, §7 of

the Law of April 1, 2007 on public takeover bids from Tubize,

Schwarz Vermögensverwaltung GmbH & Co. KG and UCB Fipar

SA, acting in concert at that time, respectively on November 22,

2007, December 11, 2007 and December 28, 2007.

On August 25, 2022, UCB received the latest updated

notification pursuant to article 74, §8 of the Law on public

takeover bids from Tubize (available on the UCB website), in

which Tubize declared that since July 31, 2021, it acquired

1 106 880 UCB shares, owning a total of 69 440 861 shares,

representing 35.70% of the total number of shares issued by the

Company (194 505 658).

UCB | Integrated Annual Report 2022

134

Shareholding

Amount of

Financière de Tubize S.A.    .%

Treasury shares    .%

Wellington Management

Group LLP

   .%

BlackRock, Inc.    .%

FMR LLC    .%

Other institutional investors    .%

Retail investors    .%

Unidentified    .%

Total shares    %

6.07%

Retail investors

4.84%

BlackRock, Inc.

7.80%

Wellington

Management Group LLP

3.86%

FMR LLC

36.89%

Other

institutional

investors

35.70%

Financière de

Tubize S.A.

2.52%

Treasury shares

2.31%

Unidentified

3.3.4 Shareholder structure

Apart from the notifications mentioned above under 3.3.2 and

3.3.3, UCB SA also holds UCB shares (see above – own shares).

The remaining UCB shares are held by the public.

Please find below an overview of the large shareholdings of

UCB (including assimilated financial instruments), taking into

account the shareholders’ register of UCB, the transparency

notifications received pursuant to the Law of May 2, 2007 on

the disclosure of large shareholdings, the notification received

pursuant to article 74, §8 of the Law of April 1, 2007 on public

takeover bids, the notifications to the FSMA pursuant to the Law

of August 2, 2002 on the supervision of the financial sector

and the financial services and as the case may be, more recent

public disclosures (situation as per December 31, 2022):

(all percentages are calculated on the basis of the current total number of voting rights)

UCB | Integrated Annual Report 2022

135

Assimilated financial instruments within the meaning of article

6, §6 of the Law of May 2, 2007 on the disclosure of large

shareholdings.

Free float being the UCB shares not held by the reference

shareholder (Tubize) and UCB SA/NV. Only securities carrying

voting rights (shares) held by these entities are taken into

account for this calculation; assimilated financial instruments

are excluded.

3.3.5 General Meeting of Shareholders

In accordance with the Articles of Association, the Annual

General Meeting of Shareholders (the ‘General Meeting’) takes

place on the last Thursday of April at 11.00 AM CET. In 2022, the

AGM was held on April 28. In 2023, this will be on April 27.

The rules on the agenda, the procedure for convening

meetings, admittance to the meetings, the procedure on the

exercise of voting rights and other details can be found in the

Articles of Association and in the Charter, which are available on

UCB’s website.

UCB Controlling and major shareholdings on December 31, 2022

Notifications received pursuant to the law of 2 May 2007 on disclosure of large shareholdings

Last update: December 31, 2022

Situation as

per

Share capital €    Mar , 

Total number of voting rights (= denominator)    Mar , 

1 Financière de Tubize SA (‘Tubize’)

securities carrying voting rights (shares)    .% Jul , 

2 UCB SA/NV

securities carrying voting rights (shares)    .% Dec , 

assimilated financial instruments (options)

 .% Mar , 

assimilated financial instruments (other)

 .% Dec , 

Total    .%

Free float

(securities carrying voting rights (shares))    .%

3 Wellington Management Group LLP

securities carrying voting rights (shares)    .% May , 

4 BlackRock, Inc.

securities carrying voting rights (shares)    .% Jan , 

5 FMR LLC

securities carrying voting rights (shares)    .% Aug , 

(all percentages are calculated on the basis of the current total number of voting rights)

1 Assimilated financial instruments within the meaning of article 6, §6 of the Law of 2 May 2007 on the disclosure of large shareholdings.

2 Free float being the UCB shares not held by the reference shareholder (Tubize) and UCB SA/NV. Only securities carrying voting rights (shares) held by these entities are

taken into account for this calculation; assimilated financial instruments are excluded.

UCB | Integrated Annual Report 2022

136

3.4 Board of Directors and Board committees

The governance of UCB is based on a “one-tier” structure.

This means that the Company is administrated by a Board

of Directors and run by an Executive Committee, whose

respective functions and responsibilities are defined below in

accordance with the Articles of Association of the Company

and the Charter. The Board did not opt for a “two-tier” structure

based on a separate Supervisory Board and Management Board.

It considers that the current system foresees an appropriate

balance of powers between the Board and the management,

and the composition of the Board is in line with UCB’s current

shareholder structure and business activities. It also did not want

to permanently delegate to management the powers granted

to the Board by the law in its current one-tier structure, nor

the general representation of UCB. The Board will review its

governance structure at least once every 5 years. The last review

was performed by the Board in October 2019.

3.4.1 Board of Directors

Composition of the Board and independent Directors

Board composition and changes in 2022

As at December 31, 2022, the Board of Directors was composed

as follows:

Mandates of Board members in listed companies are marked with an *

FIONA DU MONCEAU

Vice-Chair of the Board and

Chair ad interim

1978 – Belgian

UCB Board Mandate

• Member since 2021

• Vice-Chair of the Board

since 2021

• Chair of the Governance,

Nomination and

Compensation

Committee since 2021

• End of term: 2025

Experience

Over 20 years of experience in the biotech and pharmaceutical

industry

Main external appointments

• Member of the Board of Financière de Tubize SA*

JEANCHRISTOPHE TELLIER

Executive Director and CEO

1959 – French

UCB Board Mandate

• Member since 2014

• End of term: 2026

Experience

Over 30 years in the

pharmaceutical sector, with

Ipsen and Novartis where he

held several senior executive

positions in different parts of

the world

Main external appointments

• Chair of BCR (Biopharmaceutical CEOs Roundtable)

• President of IFPMA (International Federation of

Pharmaceutical Manufacturers & Associations)

• Member of the Board of the European Federation of

Pharmaceutical Associations (EFPIA)

• Vice-Chair of the Innovation Board Sponsored Committee

(EFPIA)

• Member of the Board of PhRMA (Pharmaceutical Research

and Manufacturers of America)

• Member of the Supervisory Board of Servier

UCB | Integrated Annual Report 2022

137

JAN BERGER

Independent Director

1957 – American

UCB Board Mandate

• Member since 2019

• End of term: 2023

Experience

Over 30 years as a tri-sector healthcare executive that has

proven results as a senior executive in the three sectors of

private, public and government services

Main external appointments

• Member of the Board of Tabula Rasa Healthcare Inc.*

• Member of the Board of GNS Healthcare

KAY DAVIES

Independent Director

1951 – British

UCB Board Mandate

• Member since 2014

• Chair of the Scientific

Committee since 2014

• Member of the

Governance, Nomination

and Compensation

Committee since 2017

• End of term: 2026

Experience

Over 20 years in the scientific research at Oxford University

Main external appointments

• Member of the Board of Directors of Oxford Biomedica*

• Member of the Scientific Advisory Board of Sarepta

Therapeutics

• Non-executive Director of Thomas White Limited

ALBRECHT DE GRAEVE

Director

1955 – Belgian

UCB Board Mandate

• Member since 2010

• Member from 2010 to

2021 and chairman from

2015 to 2021 of the Audit

Committee

• End of term: 2025

Experience

Over 30 years in global operations in various industry sectors

(Alcatel, VRT, Bekaert, Telenet and Sibelco)

Main external appointments

• Chairman of the Board of Directors of Sibelco NV

• Independent Director of Bank Nagelmackers

• Independent Chairman of the Welvaartsfonds NV

UCB | Integrated Annual Report 2022

138

SUSAN GASSER

Independent Director

1955 – Swiss

UCB Board Mandate

• Member since 2021

• Member of the Scientific

Committee since 2021

• End of term: 2025

Experience

• Director of the Friedrich Miescher Institute for Biomedical

Research, part of the Novartis Research Foundation (2004 -

2019)

• Board of Directors of the Genomics Institute of the Novartis

Foundation (2014 - 2018)

• University professorships (2001-present)

• Nestlé Nutrition Council (Intl scientific board) (2008 - 2018)

Main external appointments

• Director of the ISREC Foundation, Lausanne, Switzerland

since 2021

• Member, Swiss Wissenschaftsrat (Swiss Science Council, SSC),

Bern, Switzerland since 2016

• Member, ETH Board (Governing Board of the ETH Domain),

Switzerland since 2018

• Chair, Strategic Board of the Helmholtz Society Health

Program, Germany 2019-2027

• Scientific advisor, VI Partners AG*, Switzerland since 2021

PIERRE L. GURDJIAN

Independent Director

1961 – Belgian

UCB Board Mandate

• Member since 2016

• Vice-Chair from 2017 to

2021

• Member of the

Governance, Nomination

and Compensation

Committee since 2016

• End of term: 2024

Experience

Senior Partner at McKinsey and Co. where he was active for

nearly three decades and senior professional in the field of

Philanthropy and Education

Main external appointments

• President of the Board of the Université Libre de Bruxelles

• Member of the Board of Lhoist

• Member of the Board of Solvay*

UCB | Integrated Annual Report 2022

139

CHARLESANTOINE JANSSEN

Director

1971 – Belgian

UCB Board Mandate

• Member since 2012

• Member of the Audit

Committee since 2015

• End of term: 2024

Experience

Over 20 years in operations, including UCB where he held

several management positions, now managing private equity

and impact investing activities

Main external appointments

• Member of the Board of Financière de Tubize SA*

• Managing Partner of Kois SA

• Partner of Kois related funds (HealthQuad, Impact Expansion)

• Board member of private companies

CYRIL JANSSEN

Director

1971 – Belgian

UCB Board Mandate

• Member since 2015

• End of term: 2023

Experience

With over 20 years’ experience as an independent advisor,

Cyril has held positions in both the audiovisual and non-

governmental field. A strong advocate for children’s welfare,

Cyril’s main focus for the past 10 years has been on investing

in initiatives with a strong societal impact and those aimed at

making life easier for families.

Main external appointments

• Member of the Board of Financière de Tubize SA*

• Member of the Board of FEJ SRL

VIVIANE MONGES

Independent Director

1963 – French

UCB Board Mandate

• Member since 2017

• Member of the Audit

Committee since 2018

• End of term: 2025

Experience

30 years in finance functions mostly in the pharmaceutical

industry (Wyeth, Novartis, Galderma, Nestlé)

Main external appointments

• Member of the Board of Novo Holdings

• Member of the Board of Pharvaris*

• Member of the Board of ADC Technologies*

• Chair of the Supervisory board of EUROAPI*

UCB | Integrated Annual Report 2022

140

JONATHAN PEACOCK

Independent Director

1958 – British/American

UCB Board Mandate

• Member since 2021

• Chair of the Audit

Committee since 2021

• End of term: 2025

Experience

More than 30 years pharmaceutical, biotechnology, corporate

finance and strategy experience including global CFO roles at

Amgen and Novartis Pharma, Board leadership in building young

biotech companies and leadership roles in corporate finance

and strategy as a partner at McKinsey and Price Waterhouse

Main external appointments

• Chairman of the Board of Directors of Avantor Inc*

• Chairman of the Board of Directors of Bluesphere Bio, Inc.

• Board member Real Chemistry

CÉDRIC VAN RIJCKEVORSEL

Director

1970 – Belgian

UCB Board Mandate

• Member since 2014

• End of term: 2026

Experience

Over 20 years in the banking and financial sector, mainly with

IDS capital. During those years, he specifically built a global

network of private equity investors and key opinion leaders in

Digitalization, Health tech, Smart City Technologies, Blockchain

and Climate related technologies.

Main external appointments

• Member of the Board of Financière de Tubize SA*

• Member of the Board of Barnfin SA

• Managing Director and Founder of IDS Capital (Switzerland

and U.K.)

ULF WIINBERG

Independent Director

1958 – Danish/Swedish

UCB Board Mandate

• Member since 2016

• Member of the Audit

Committee from 2016 to

2021

• End of term: 2024

Experience

Almost 20 years of senior leadership experience in

pharmaceutical companies and healthcare industry associations

Main external appointments

• Member of the Board of Alfa Laval AB*

• Member of the Board of Agenus Inc*

• Member of the Board of Mink Therapeutics*

• CEO of X-Vax Therapeutics Inc.

UCB | Integrated Annual Report 2022

141

The Secretary of the Board is Xavier Michel, Group Corporate

Secretary. The role and responsibilities of the secretary of the

Board are described in the UCB Charter.

At the General Meeting of April 28, 2022, the mandates of Kay

Davies (independent Director), Jean-Christophe Tellier and

Cédric van Rijckevorsel, were renewed for a term of four years.

Since the AGM 2021, the total number of Board members

remained stable, with 14 members, which is within the

maximum limit currently set forth in the Charter (15 Board

members), until the resignation of Stefan Oschmann in

December 2022. Since December 2022, the Board is

composed of 13 members. In accordance with article 3.2.6.2 of

the Charter, the Vice-Chair (Fiona du Monceau) presides over

Board meetings in the absence of the Chair. Stefan Oschmann

resigned for personal reasons. This resignation was unplanned.

To allow for an appropriate succession procedure to be

followed, Fiona du Monceau is exercising the function of Chair

of the Board ad interim, in accordance with the above rule of

UCB Charter of Corporate governance.

On December 31, 2022, Jonathan Peacock, Susan Gasser,

Kay Davies, Viviane Monges, Pierre Gurdjian, Jan Berger and

Ulf Wiinberg all qualify as independent Directors and meet

the independence criteria, as set forth by the 2020 Code and

the Board. The mandate of Albrecht De Graeve was renewed

at the AGM of April 29, 2021 for a term of 4 years (until the

AGM of 2025). Albrecht De Graeve does no longer qualify as

independent directors since the AGM of April 28, 2022 because

the total tenure of his directorship exceeded 12 years. For the

same reason, he stepped down from the Audit Committee

since the AGM of April 28, 2022. He remains in the Board as

non-independent Director for the remainder of his mandate.

Fiona du Monceau, Charles-Antoine Janssen, Cyril Janssen and

Cédric van Rijckevorsel are representatives of the Reference

Shareholder and, as such, are not eligible to qualify as

independent Director. Jean-Christophe Tellier being the CEO

of UCB SA/NV, is also not eligible to qualify as independent

Director. He is also the only executive director in the UCB Board.

In 2022, the Board was therefore composed of a majority

of independent Directors: before the resignation of Stefan

Oschmann, out of the 14 members, 8 members were

independent. After the resignation of Stefan Oschmann,

the Board was still composed of a majority of independent

Directors: out of the 13 members, 7 members remained

independent. During 2022, the Board was also composed of

5 women out of a total of 14 members (36%), than out of a total

of 13 members (38%) since December 2022 in compliance with

the gender diversity requirement of Article 7:86 BCCA.

UCB | Integrated Annual Report 2022

142

Expected Board Changes in 2023

The mandates of Jan Berger (independent Director) and Cyril

Janssen will expire at the Annual General Meeting of April 27,

2023 (“AGM 2023”) and the Board will propose at this AGM the

renewal of their mandate for a new period of four years.

Also, Viviane Monges will step down from the Board and Audit

Committee with effect on the date of the AGM 2023 (April 27,

2023). She recently accepted a mandate as chair of the board

of another listed company (EUROAPI) and decided to end her

mandate with UCB to avoid a situation where she could not

ensure to dedicate the time needed for a full engagement as

director of UCB. UCB is grateful to Viviane Monges for her great

contribution in the Board and its Audit Committee since her

appointment as director of UCB in 2017. Consequently, the

Board will propose to the AGM 2023 the appointment of Maëlys

Castella as independent Director, for a term of four years,

further to Viviane Monges’s departure. Upon her appointment

as independent Director, she will also replace Viviane Monges

as member of the Audit Committee. Maëlys Castella has an

extensive experience as executive, amongst other in CFO

positions, as well as non-executive director, in international listed

companies. Like all new Board members, she will benefit from

appropriate onboarding program, including individual meetings

with each member of the Executive Committee and selected

senior managers of UCB.

Upon confirmation of the above renewals and appointment

by the General Meeting of April 27, 2023, and in accordance

with the Charter, the Board will continue to be composed of

a majority of independent non-executive Directors. All special

Board Committees will also continue to be composed of a

majority of independent Directors:

• Audit Committee: Jonathan Peacock (Chair & independent),

Maëlys Castella (independent) and Charles-Antoine Janssen

(non-independent);

• GNCC: Fiona du Monceau (Chair and non-independent),

Pierre Gurdjian (independent) and Kay Davies (independent);

• Scientific Committee: Kay Davies (Chair & independent) and

Susan Gasser (independent).

Jean-Christophe Tellier will continue to be the only executive

Director (CEO) in the Board.

Following the proposed renewals and appointment, and if

approved by the AGM 2023, the Board will still be composed of

5 women out of 13 members (38%), remaining compliant with

the gender diversity requirement of Article 7:86 BCCA.8

Functioning of the Board

In 2022, the Board met six times for its regular meetings,

including for its 3-day annual strategic meeting (October).

Further to the relaxation of measures around the Covid-19

pandemic, and except for its meetings in February and April

2022 held by videoconferences, all other meetings were held

in person. From time to time, even if the meeting is held in

person, a hybrid setting may be exceptionally organized to allow

the attendance by video conference of one or more Board

members who would not be able to travel or otherwise attend

in person. The attendance rate of its members for its regular

meetings was as follows:

Attendance

rate

Stefan Oschmann

Chair *

80%

Fiona du Monceau

Vice Chair **

100%

Jean-Christophe Tellier

Executive Director

100%

Pierre L. Gurdjian 100%

Jan Berger 100%

Kay Davies 100%

Albrecht De Graeve 100%

Susan Gasser 100%

Charles-Antoine Janssen 100%

Cyril Janssen 100%

Viviane Monges 100%

Jonathan Peacock 100%

Cédric van Rijckevorsel 100%

Ulf Wiinberg 100%

Until 12 December 2022

also Chair ad interim since 13 December 2022

Stefan Oschmann was not able to attend the June Board

meeting for health reasons

UCB | Integrated Annual Report 2022

143

On top of its regular meetings, the Board also met via shorter ad

hoc videoconference calls to review and/or decide on specific

projects or urgent matters. The Board also had a few informal

sessions to reflect on specific themes or matters (e.g. Digital

and Sustainability) as the case maybe with external speakers

to enhance the experience and/or to provide an outside in

perspective.

During 2022, the Board’s main areas of discussion, review and

decisions included:

• The strategy of UCB and the overall supervision of its

implementation by the Management, including ESG matters

and the integration of sustainability into the overall ambition

and activities of the Company, the long-term innovation

strategy, and manufacturing capabilities.

• The performance and financial situation of the company in

the particular context of the loss of exclusivity of key products

in key markets (VIMPAT

** in EU and US and E KEPPRA

in Japan), the delay in the launch of BIMZELX

* in the US

following the FDA complete response letter issued in May

2022 and a volatile environment (war in Ukraine, Energy crisis,

inflation, …).

• Financial and non-financial reporting and communication to

the market (including the revised external financial guidance

in June 2022).

• Resource, cash allocation and budget.

• Monitoring of the launch activities (BIMZELX

*, EVENITY

**,…)

and launch preparednesss.

• Business Development and M&A Projects, including the post-

acquisition integration of Zogenix.

• Digital business transformation.

• Cybersecurity.

• Review of the Board formal assessment (see below).

The general oversight of the Digital and IT strategy as well as

cybersecurity is part of the Board’s mission. Every year, the

Board, and its Audit Committee in particular, have specific

sessions dedicated to Digital /IT and cybersecurity strategies

and operations. Digital transformation and strategy are also

fully embedded in the overall strategy of UCB, as defined by

the Board, upon proposal of the Executive Committee and was

one of the key central topics on the agenda of the Strategic

Board session of October. Cyber Security status and strategy are

usually reviewed by the Board once a year. In case of incident,

there would be a close monitoring by the Board, including

through its Audit Committee, with additional ad hoc meetings

if necessary.

In accordance with its governance rules, the Board also held

two executive sessions in 2022 (i.e. sessions in the absence of

the CEO, the only executive Board member), one in June and

another one in December.

There were no transactions or contractual relationships in 2022

between UCB, including its affiliated companies, and a member

of the Board, giving rise to conflicts of interest, except as

reported in section 3.12.

Assessment of the Board

In accordance with its Charter (section 3.5), the Board is to

conduct an assessment on a regular basis and at least every

other year. The Chair of the GNCC is responsible for conducting

the Board effectiveness assessment process and for reporting

the results to the Board. An assessment was carried out in

2019 by an external consultant and was reported in the

(Integrated) Annual Report 2019. In accordance with the above

rules, an assessment should have normally taken place in

2021. However, given that 2021 was a year of critical changes

in the composition of the Board, the newly constituted Board

(as of May 2021) was of the opinion that it was too early

for conducting such assessment and decided to postpone

it to 2022 to allow the Board to assess its functioning and

performance after a full year cycle.

In 2022, the Board conducted a full Board assessment,

carried out by an external consultant. The results of this

assessment were analyzed by the GNCC and shared and

discussed with the Board in December 2022. The evaluation

overall showed that the functioning of the Board has strong

fundamentals, aligned with clear processes and rules as per

its Charter. The scores of the board on both effectiveness and

culture were above global and EU averages. The Board and

management are well aligned on UCB’s go-forward strategy.

Following this assessment, and while continuing to enrich its

dynamics and engagement, the Board will further leverage

on its strong fundamentals in the context of the acceleration

of UCB’s business with a focus on the strategy, an emphasis

on stewardship of key talents and capabilities and a continued

attention to its succession plan, taking into consideration the

evolution of UCB’s activities and business.

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

UCB | Integrated Annual Report 2022

144

Honorary directors

The Board has nominated following directors as honorary

directors:

• Karel Boone, Honorary Chair

• Evelyn du Monceau, Honorary Chair

• Mark Eyskens, Honorary Chair

• Georges Jacobs de Hagen, Honorary Chair

• Daniel Janssen, Honorary Deputy Chair

• Gerhard Mayr, Honorary Chair

• Prince Lorenz of Belgium

• Alan Blinken

• Alice Dautry

• Arnoud de Pret

• Roch Doliveux

• Peter Fellner

• Guy Keutgen

• Jean-Pierre Kinet

• Tom McKillop

• Gaëtan van de Werve

• Jean-Louis Vanherweghem

• Bridget van Rijckevorsel

• Norman J. Ornstein

3.4.2 Board committees

Audit Committee

The Board has set up an Audit Committee whose functioning

and terms of reference are in accordance with the BCCA,

the 2020 Code and the Charter. It is composed of a majority

of independent Directors, all non-executive Directors, and

is chaired by Jonathan Peacock, since his appointment as

independent director by the AGM of April 29, 2021. Albrecht

De Graeve stepped down from the Audit Committee since

the AGM of April 28, 2022, as he was no longer qualified as

independent director as from that date. All members have the

competencies in audit and accounting matters as required by

article 7:99 of the BCCA.

End of term

of office

Independent

Director

Attendance

rate

Jonathan Peacock Chair  X %

Albrecht De

Graeve*

 X %

Charles-Antoine

Janssen

 %

Viviane Monges  X %

Member and independent until the AGM 2022

The Audit Committee met four times in 2022. Each Audit

Committee meeting includes separate private sessions attended

solely by the internal and external auditors respectively without

executive or management presence. As necessary, the External

Auditors attended all or part of each Audit Committee meeting.

Further to the relaxation of measures relating to the Covid-19

pandemic, the meetings of the Audit Committee were held

in-person, except for the meeting in February which was held by

videoconference. The Audit Committee was also exceptionally

consulted in June to review with management the proposed

updated external financial guidance, ahead of the Board

meeting which took the final decision.

The Audit Committee meetings were also attended by

Sandrine Dufour (EVP – Chief Financial Officer & Corporate

Development), Thomas Debeys (Head of Internal Audit),

Caroline Vancoillie (Head of Group Finance) and Xavier Michel

(Group Secretary General), who acts as secretary of the Audit

Committee.

The meetings were also attended wholly or partially by Jean-

Christophe Tellier (CEO), Stefan Oschmann (Chair of the Board

until December 2022) and other members of the management

or staff depending on the topic (accounting, tax, risk, pensions,

quality, IT, etc.).

In 2022, and in accordance with its terms of reference (see

the Charter available on UCB website), the Audit Committee

monitored the financial reporting process (including the

financial statements and communication to the market),

including the external financial guidance and its revision in June

2022. The Audit Committee also focused on the evolution

of the tax environment and its potential impact on UCB, the

internal control and risk management systems of UCB and

their effectiveness; the internal audit and its effectiveness, the

Audit Plan and resulting achievements; the statutory audit

of the annual/HY and consolidated accounts; the review

and monitoring of pensions schemes and liability; and the

independence of the External Auditor including the provision

of additional services to UCB, which the Audit Committee

reviewed and for which it authorized the fees; Cybersecurity and

IT controls as well as Enterprise Risk Management also remained

high on the agenda of the Audit Committee in 2022. The Audit

Committee had a close look at the non-financial information

reporting process, approach, methodology, framework and

measures to ensure its consistency with the reporting of the

financial information in the (Integrated)

Annual Report.

UCB | Integrated Annual Report 2022

145

Governance, Nomination and Compensation Committee

The Board has set up a Governance, Nomination and

Compensation Committee (the “GNCC”), whose composition,

functioning and terms of reference are in accordance with the

BCCA, the 2020 Code and the Charter. The composition of the

GNCC is currently as follows:

In 2022, and in accordance with its terms of reference (see the

Charter available on UCB website), the main areas of focus for

the GNCC were the following:

• Review and recommendations with respect to the

appointments to be submitted to Board approval,

• Remuneration matters: review of the performance of the

Executive Committee members and of their remuneration

and related recommendations to the Board. the GNCC

reviewed and submitted to Board approval the remuneration

report 2021, the update of the Remuneration Policy 2022,

the short-term and long-term incentives to be granted to

the management (including the CEO) and the performance

criteria, KPI’s and targets to which these grants and bonuses

were linked, as well as definition of the Group LTI plans main

terms & conditions.

• Succession planning for the members of the Board, the

Executive Committee and senior executives. This included

relevant proposals or recommendations to the Board with

respect to the future composition of the Board and of its

committees, to be effective as of approval by the General

Meeting of April 27, 2023.

• Board assessment conducted by an external consultant and

review of outcomes and recommendations.

• Review and monitoring of evolutions in Corporate

governance standards and legislation, including a review of

the main outcomes and feedback from the 2022 AGM voting

as well as the ESG roadshows organized with investors in

March and November 2022;

• The GNCC also had a close look at the impact of the new

expat tax regime in Belgium and its implementation for senior

executives at UCB.

End of term

of office

Independent

Director

Attendance

rate

Fiona du Monceau Chair  %

Kay Davies  X %

Pierre L. Gurdjian  X %

Stefan Oschmann * 

X %

Resignation on 12 December 2022

The GNCC met four times in 2022 for its regular meetings

in February, July, October and December. An additional

exceptional meeting was also held in May to review and discuss

the impact of the new Expat Tax Regime in Belgium (new

legislation) and its implementation at UCB for senior executives.

The committee was attended by Jean-Christophe Tellier (CEO),

except when discussing issues relating to him, and by Jean-

Luc Fleurial (EVP & Chief Human Resources Officer), who has

been acting as secretary of the GNCC, except when discussing

issues relating to him and to the CEO compensation. Further to

the relaxation of measures relating to the Covid-19 pandemic,

the meetings of the GNCC were held in-person, except for

the meeting in February which was held by videoconference.

A majority of the members of the GNCC is independent and

meets the independence criteria stipulated by the 2020 Code

and the Board. All members have the competencies and the

expertise in matters of remuneration policies as required by

article 7:100, §2 BCCA.

UCB | Integrated Annual Report 2022

146

Scientific Committee

The Scientific Committee assists the Board in its review of the

quality of UCB’s R&D science and its competitive standing.

The Scientific Committee is composed of members who have

scientific and medical expertise and who are all independent.

They meet regularly with Dhaval Patel (EVP & Chief Scientific

Officer) and Jean-Christophe Tellier (CEO). The members

of the Scientific Committee are also closely involved in the

activities of UCB’s Scientific Advisory Boards (SAB) composed of

external leading scientific medical experts (usually 2 meetings

per year). The SABs, composed of ad hoc experts, provide

scientific appraisal and strategic input in their area of expertise

as to the best way for UCB to become a more robust and

thriving biopharmaceutical leader and to advise the Executive

Committee on the strategic choices related to early-stage R&D.

Furthermore, the Scientific Committee’s main task is to report

to the Board on the SAB’s appraisal of UCB’s research activities

and strategic orientations. This year, further to the relaxation of

measures relating to the Covid-19 pandemic, two in-person SAB

meetings took place. The subject matters of these meetings

were to explore emerging areas of science as well as next

frontiers in immunology as well as digital and causal disease

biology (“Pathobiology in the Digital Age”). The Members of

the Scientific Committee also participated in the annual R&D

portfolio review meetings, and in the annual review of Early

Solutions Knowledge-Generating Technology and Platforms

(Research & Early Development).

Throughout the year, the members of the Scientific Committee

continued to meet regularly with Dhaval Patel, UCB’s Chief

Scientific Officer, to maintain a continuous engagement

and dialogue on the science and early pipeline. In 2022, the

Scientific Committee continued to look closely at the evolution

of the research strategy (for instance in Gene Therapy) and

evolution of the research operating model.

End of term

of office

Independent

Director

Attendance

rate

Kay Davies Chair  X %

Susan Gasser  X %

3.4.3 Governance for Sustainability

UCB’s sustainability ambition is embedded in the overall strategy

of UCB as defined by the Board, upon proposal of the Executive

Committee. Sustainability is considered to be a matter for the

full Board (strategy) and, for this reason, no specific sustainability

committee has been created within the Board. Several sessions

on sustainability were organized with the full Board, including as

part of the Strategic Board Meeting of October. In July 2022, the

Board also had a session with an external consultant to reflect

on the role of the Board in sustainability matters.

UCB ensures that it has appropriate skills in sustainability at

Board level and, currently, at least two members of the

Board have extended experience and expertise in ESG/

sustainability matters.

At management level, UCB has established a Sustainability

Governance Committee and has appointed a Head of

Sustainability who directly reports to the CEO.

UCB also created an External Sustainability Advisory Board

(ESAB), composed of a mix of external international experts in

sustainability, who can inspire, as well as challenge and advise

on the sustainability dimension of UCB’s strategy and results and

provide an “outside in” perspective. Board members have access

to the meetings of the ESAB and at least two members of the

Board participate in the meetings of the ESAB on a rotating

basis. The ESAB is scheduled to meet 3 times per year. The

external members of this advisory board are currently Mr. Elhadj

As Sy (President Kofi Annan Foundation), Ms. Sandrine Dixson-

Declève (Co-President Club of Rome), Ms. Charlotte Ersbøll

(Trustee Forum for the Future), Ms Teresa Fogelberg (Former

GRI deputy Chief Executive), Ms. Hannah Jones (CEO, the

Earthshot Prize), and Mr Bright Simons (Founder and President

mPedigree). A report of the EASB is presented to the Board of

Directors of UCB on an annual basis. The report that relates to

their interaction with UCB in 2022 was shared with the Board of

UCB in February 2023.

UCB | Integrated Annual Report 2022

147

3.5 Executive Committee

Composition of the Executive Committee

In 2022, the Executive Committee was composed as follows:

Jean-Christophe Tellier

Chief Executive Officer

1959 – French

Joined UCB in 2011

• Appointed CEO in 2015

Main external appointments

• Chair of BCR

(Biopharmaceutical CEO’s

Roundtable)

• President of IFPMA

(International Federation

of Pharmaceutical

Manufacturers &

Associations)

• Member of the Board of the European Federation of

Pharmaceutical Associations (EFPIA)

• Vice-Chair of the Innovation Board Sponsored Committee

(EFPIA)

• Member of the Board of PhRMA (Pharmaceutical Research

and Manufacturers of America)

• Member of the Supervisory Board of Servier

Experience

Over 30 years in the pharmaceutical sector, with Ipsen and

Novartis where he held several senior executive positions in

different parts of the world.

Dhaval Patel

Executive Vice President & Chief

Scientific Officer

1961 – American

Joined UCB in 2017

• Appointed in 2017

Main external appointments

• Chair of the Board of Mimetas

• Member of the Board of Anokion

• Member of the Board of Priothera

• Member of the Board of Quell Therapeutics

• Clinical Professor of Medicine at University of North Carolina

Experience

Over 30 years of experience in R&D and immunology, more

specifically with Novartis and in the academic world at Duke

University Medical Center and the University of North Carolina.

Iris Löw-Friedrich

Executive Vice President & Chief

Medical Officer

1960 – German

Joined UCB in 2006

• Appointed in 2008

Main external appointments

• Chair of the Supervisory Board of Evotec SE

• Member of the Strategic Advisory Board of Helmholtz Health

Association

• Member of the Supervisory Board of Fresenius SE & Co.

KGaA*

• Member of the Board of TransCelerate

• Member of the Board of PhRMA Foundation

• Member of the Board of MAPS (Medical Affairs Professional

Society)

Experience

Physician, board-certified in internal medicine, with more than

20 years of experience in the development of medicines.

Mandates of Executive Committee members in listed company are marked with an *

UCB | Integrated Annual Report 2022

148

Charl van Zyl

Executive Vice President Neurology

Solutions & Head of EU/International

1967 – British/South African

Joined UCB in 2017

• Appointed in 2017

No external appointments

Experience

Almost 20 years of experience across the healthcare value

chain, including business development and licensing,

manufacturing, marketing and sales and research & clinical

development.

Emmanuel Caeymaex

Executive Vice President

Immunology Solutions & Head of U.S.

1969 – Belgian

Joined UCB in 1994

• Appointed in 2015

Main external appointments

• Member of the Board of BIO (Biotechnology Innovation

Organization)

Experience

25 years of broad experience in biopharmaceuticals

commercialization, development and general management,

across the world.

Kirsten Lund-Jurgensen

Executive Vice President, Supply

& Technology Solutions

1959 – German

Joined UCB in 2019

• Appointed in 2019

No external appointments

Experience

Pharmacist, with more than 35 years of experience in

manufacturing and supply of biopharmaceuticals, with

leadership roles at SmithKline Beecham in Germany, Australia

and the U.S, and senior executive positions at Pfizer in the U.S.

UCB | Integrated Annual Report 2022

149

Jean-Luc Fleurial

Executive Vice President & Chief

Human Resources Officer

1965 – French

Joined UCB in 2017

• Appointed in 2017

No external appointments

Experience

Over 20 years of experience in building and implementing

talent strategy across geographies and businesses, mainly with

Procter&Gamble and Bristol Myers Squibb.

Sandrine Dufour

Executive Vice President & Chief

Financial Officer

1966 – French

Joined UCB in 2020

• Appointed in 2020

Main external appointments

• Member of the Board of WPP*

Experience

Over 25 years of experience in finance, M&A, strategy, digital

transformation in telecom and media industries with senior

executive positions at Vivendi, SFR and Proximus.

Bill Silbey

Executive Vice President &

General Counsel

1959 – American

Joined UCB in 2011

• Appointed in 2019

No external appointments

Experience

Over 35 years of experience in biopharmaceuticals legal affairs,

mergers and acquisitions, business development, venture

capital, litigation and compliance activities as well as experience

as a partner in 2 U.S. business law firms.

UCB | Integrated Annual Report 2022

150

The composition of the Executive Committee is reflecting

the ways of working of the group and is aimed at fostering

agility, cross collaboration and the transversal dimension of the

organization.

Xavier Michel, Group Secretary General, acts as the secretary

of the Executive Committee, ensuring the link between the

Board of Directors, the Executive Committee and the broader

organization.

Honorary chairmen of the Executive Committee

The following persons have been nominated as honorary Chair

of the Executive Committee:

• Roch Doliveux

• Georges Jacobs de Hagen

• Daniel Janssen

Functioning of the Executive Committee

The Executive Committee met on a regular basis with an

average of 1 to 2 days a month in 2022. The members of

the Executive Committee have also informal meetings on a

regular basis.

There were no transactions or contractual relationships in 2022

between UCB, including its affiliates, and a member of the

Executive Committee that could lead to a conflict of interest.

The functioning, competences and authority of the Executive

Committee are further described in the Charter.

UCB | Integrated Annual Report 2022

151

3.6 Diversity at Board and Executive

Committee level

This section includes the information required pursuant to

articles 3:32, §2 and 3:6, §2, 6° of the BCCA.

Diversity at Board and Executive Committee Level is part of

the overall Diversity, Equity and Inclusion ambition of UCB,

as described in the Diversity, equity and inclusion section of

this report and to which it is expressly referred.

Diversity at the Board level

For the Board of Directors, the legal requirements

applicable in Belgium in terms of gender diversity have

been followed and have been integrated into the Board

recruitment and nomination process. When replacements

or appointments for the Board are considered, UCB

systematically takes into account how it will enhance

gender diversity of the Board.

The Board is currently made up of 13 members of which

5 women and 8 men, with 7 nationalities represented (see

also above).

Building on and integrating the feedback from our stakeholders,

details of the skills diversity, as well as the specific geographic

expertise of the Board members, are included in the Integrated

Annual Report since 2022. Beyond gender diversity, UCB Board

always strives to keep a balanced mix of diversity in terms

of skills, experience, geographical expertise, nationality, age,

independence, tenure as well as any other relevant criterion.

The diversity of the Board can be visualized as follows:

* Which encompasses pharma specific expertise in R&D, medical & clinical, portfolio strategy, regulatory and market access

Core Industry Expertise*

Board Skill Distribution

Business Leadership and

Strategy

Finance, Accounting

and Risk

Sustainability and ESG

62%

92%

54%

31%

8/13

12/13

7/13

4/13

Asia

Specific Geographic Expertise (Europe, USA, Asia)

Europe

UCB | Integrated Annual Report 2022

152

<50

>55

>60

Age

>50

Age

Average: 60

13 members

American (US)

Belgian

British/American (US)

French

Swiss

Danish/Swedish

Nationality

British

Nationality

7 countries

13 members

<12 years

<4 years

>12 years

Tenure

<8 years

Tenure

Average:6

13 members

Men

Gender

Women

Gender

5 Women

13 members

46%

Non-independent

Status

54%

Independent

Status

13 members

UCB | Integrated Annual Report 2022

153

Diversity at the Executive Committee level

For our Executive Committee roles, we do monitor the talent

pipeline from a diversity perspective, ensuring a robust and

diverse succession plan is in place, and any recommendations

for future composition are made firmly on this basis. Generally,

and in relation to succession planning for UCB leaders in relation

to diversity, focus is on simulating gender balance scenarios

and ensuring a well-rounded senior leadership pipeline that has

been exposed to diverse professional and cultural experiences.

The Executive Committee members have also embarked with

other leaders on a multi-step program to address unconscious

bias and develop inclusive teams and leadership. Generally,

key HR process (including in recruitment and reward) have

been reviewed to ensure DE&I principles are embedded in the

process and systems.

Today, UCB’s executives come from a diverse education

and multi-disciplinary professional backgrounds. In 2022, the

committee was made up of 9 members of which 3 women and

6 men with 5 nationalities represented.

At December 31, 2022, the diversity characteristics for the

Executive Committee can be visualized as follows:

American

German

British/South African

French

Nationality

Belgian

Nationality

6 countries

9 members

Men

Gender

Women

Gender

3 Women

9 members

UCB | Integrated Annual Report 2022

154

The size of the Executive Committee is designed to focus on

the Company’s core activity areas with agility, allowing UCB to

further evolve its patient value strategy.

The approach today is not to formalize diversity, equity and

inclusion in a set of policies, but to actively promote a culture

and practice of diversity, equity and inclusion.

To learn more about diversity, equity and inclusion in general at

UCB visit Diversity, equity and inclusion section.

>50

>55

Age

>60

Age

Average: 59

9 members

>10 years

<10 years

Tenure*

<5 years

Tenure

Average: 7 years

9 members

* based on appointment date

UCB | Integrated Annual Report 2022

155

3.7 Remuneration Report

At UCB, our work is never done – because we always strive

to find new ways to deliver solutions to people living with

severe diseases and those who care for them. We innovate

to deliver unique outcomes that help patients achieve their

life goals, ensure access for those who need our solutions,

and create the best individual experience for them in a way

which is viable for UCB, our investors and society. Our reward

offering is designed to attract, develop, engage and retain

talented people who can help us reach our commitment

by successfully navigating in an ever increasingly complex

operating environment. Our priority is to reflect, in our

rewards, the strong cultural foundation shared by all our

colleagues, to help drive the value that we aim to create for

all our stakeholders and foster a working environment where

our people are happy, healthy and safe.

In this report we look back at 2022 and reflect on how our

performance, including our progress on our sustainability

ambition, influenced our executive remuneration outcomes.

AGM and Stakeholder Engagement

During 2022 we continued to engage in a dialogue with

many of our investors and with proxy advisors to understand

their priorities, to solicit their feedback on our practices and

to share our proposed evolution, especially considering

extra-financial measures that we plan to embed in executive

remuneration. We believe that the positive voting outcomes

for our 2021 remuneration report (95.67%) reflect the

confidence of our stakeholders and we continue to strive

for improvement in our governance practices, including in

both our remuneration report as well as our remuneration

policy. We had positive feedback to our efforts to increase

transparency compared to previous years and acknowledge

that several investors would like further information in this

respect in this report, we have endeavored to continue

improving transparency on our pay for performance

outcomes.

Our key changes for 2023, which are not material changes

to our policy, are the introduction of several new KPIs in our

variable pay plans, summarized in the “Remuneration Policy –

Looking Ahead” section below.

2022 performance highlights

2022 tested UCB’s agility, resilience and ability to manage

numerous headwinds, both those expected and unexpected.

Our corporate objectives anchored the organization, with

the company rallying behind BIMZELX

*, Rare Diseases,

Gene Therapy and Digital, underpinned by a sustainable

performance focus driven by our ambitions for patients,

employees, the planet and shareholders. While the delay for

the launch of bimekizumab in the US had an impact for all our

stakeholders – as did non-controllable external factors such

as inflation, the war in Ukraine and Covid-19 impacting clinical

trials, supply chain, and costs – we adjusted our plan and tightly

managed resources to ensure the best possible progress across

all other goals, including building capabilities for a successful

launch of bimekizumab in the US, and all other locations where

we have already launched.

We adjusted and developed a plan with short-term targets

that created financial efficiencies, improved our OPEX position

and focused on how to maximize the potential growth of

our portfolio. Our regulatory teams rose to the challenge,

preparing regulatory filings for seven different indications,

including some ahead of schedule such as the FDA and EMA

filings for zilucoplan

††

. This was followed by the positive news

that rozanolixizumab

††

received Priority Review designation

from the FDA for the treatment of adults with generalized

myasthenia gravis who are anti-acetylcholine receptor (AChR)

or anti-muscle-specific tyrosine kinase (MuSK) antibody positive,

thereby accelerating our potential launch date.

We completed this while successfully integrating Zogenix,

Inc. into UCB in record time. The addition of FINTEPLA

strengthened our epilepsy portfolio and brings solutions to

unmet needs of patients, aligned with our objective on Rare

Diseases.

Digital capabilities paved the way to advance and shorten

development timelines, select therapeutic candidates, and

support generating real work evidence supported by AI-based

workflows.

2022 has been a challenging year, but it ended on a positive

note with our financial performance at the upper end of our

revised guidance, bimekizumab resubmission acceptance and

rozanolixizumab

††

Priority Review label by the FDA, all providing

renewed confidence in our strong growth potential.

None of this could have been achieved without our people.

We acknowledge that it has been an exceptionally demanding

year for our workforce, yet with the commitment and

perseverance of our people we have been able to position

ourselves well for the future. We continued to leverage the

momentum of our 8 Employee Resource Groups (ERGs), which

advocate for their communities through education, mentorship

opportunities and career development, consisting of 2,000 ERG

members, or 24% of UCB’s workforce.

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

††

This is an investigational drug product and its safety and efficacy has not yet been established. It has not been approved for any use by any authority in the world.

UCB | Integrated Annual Report 2022

156

Application of Remuneration Policy – 2022

Remuneration outcomes

Our pay decisions for the CEO and the Executive Committee

considered the following factors:

• The company’s performance against both short- and long-

term goals.

• The team’s individual and collective contribution.

• External market data and trends.

• Our reward philosophy, as applied to the wider workforce.

All 2022 related remuneration decisions were taken in

accordance with our approved remuneration policy. The key

recommendations for the CEO and Executive Committee

made to the UCB Board by the Governance, Nomination and

Compensation Committee (GNCC) were the following:

Annual bonus outcomes were determined in reference to

performance against objectives and the GNCC’s assessment

of the CEO and Executive Committee members’ levels of

performance. As summarized in our 2022 Performance

Highlights, the delay of bimekizumab in the US, as well as

external factors, required our CEO and Executive Committee

members to be extremely agile and adjust our plans. In terms

of our corporate objectives, our 2022 adjusted EBITDA target

was not met and this has resulted in a bonus payment below

target. For the CEO specifically, the overall payout was € 884

110 (see below for more details). The GNCC and Board believe

that these bonus outcomes appropriately reflect the overall

2022 financial performance. Some other corporate objectives

were also impacted by exceptional internal and external

headwinds, resulting in performance below target, whereas

through resilience across the organization, other corporate

objectives were met or exceeded, as detailed in the section

“Bonus 2022 – performance against targets”.

• For the first time in 2022, we introduced a negative modifier

for the CEO and Executive Commitee bonus, linked to our

employee Health, Safety & Wellbeing (HSWB) index for

the CEO and Executive Committee. The purpose of linking

the index to executive remuneration is to ensure a focus on

maintaining a robust foundation of care for our employees

and pushing the bar for HSWB even higher. Our metric does

not provide an additional benefit to the Executive Committee

members compared to the broader workforce but instead

reduces the bonus of the Executive Committee by 5% if

a specific threshold compared to our annual target is not

reached. While elements of the index did improve, at year

end, with the result of a global employee survey, we were

able to determine that the annual target was not reached.

However, we have seen some improvements during the

year in our overall index and performance remained above

threshold; therefore the modifier was not triggered.

• The 2019-2021 performance share plan that vested on

April 1, 2022 based on achieving two pre-determined

measures: Adjusted Cumulative Operating Cashflow and

Compounded Annual Revenue Growth. The overall vesting

level was 135%, based on positive cashflow results that

lead to a 120% payout and strong revenue growth over the

performance period 2019-2021 that provided the maximum

potential payout of 150% of target. In addition, Stock Options

vested as detailed later in this report.

As mentioned above, UCB faced major headwinds in 2022,

impacting its financial performance. It is important to note that

the vesting of the 2020-2022 performance share plan, that

would normally vest on April 1, 2023 based on 2022 results,

did not reach the minimum threshold for payout for either of

the two financial measures (i.e. Adjusted Cumulative Operating

Cashflow or Compounded Annual Revenue Growth). As a

result this plan will vest at 0% (to be reported in the 2023

remuneration report).

The remuneration policy for UCB’s Executive Committee

Members and Non-Executive Directors was reviewed and

validated by the GNCC on February 19, 2021 and approved by

the Board of Directors on February 24, 2021. The policy was

adopted during the General Meeting of Shareholders on April

29, 2021 and became effective as of January 1, 2021. An update

was made to the policy in 2022, which did not contain material

elements requiring a shareholder vote, except for an update to

the Board Committee Chair fees for which a resolution was put

forward to a separate vote and which was approved at the 2022

General Assembly.

UCB | Integrated Annual Report 2022

157

Remuneration policy – Looking Ahead

In 2023, as per our commitment to our stakeholders, we are

progressing on the integration of several new sustainability

metrics into the variable remuneration of our CEO and

Executive Committee members, as well as to our broader

executive population, to drive performance against our most

material extra-financial priorities over the coming 3 year

period. These new extra-financial measures will feature in our

upcoming Performance Share Plan grant and will increase the

weighting of extra-financial measures from 10% to 25% in the

plan. These will include:

• A measure of scientific innovation that focuses efforts

on both late-stage positive outcomes and also early

pipeline replenishment to ensure that we continuously

and successfully bring innovative solutions to patients

(representing 10% of the total weight).

• From a diversity, equity and inclusion (DE&I) perspective we

will focus on improving gender balance at executive level

(representing 5% of the total weight).

In 2022 we included a new metric in our Performance Share

Plan linked to our Patient Access ambition. Our goal with this

KPI is to measure and drive timely access for patients who

need our newly launched solutions, through improvements

in reimbursement. The metric, with some small adjustments,

will continue to feature in the 2023 plan, representing a 10%

weighting.

While we do have other important extra-financial measures and

targets in our corporate objectives, such as CO

e reduction and

a broader set of DE&I measures, specific individual targets will

be set for each individual Executive Committee member and

their teams in light of their ability to impact these ambitions, as

opposed to collective KPIs in our variable pay plans.

We are also adapting our financial measures to better reflect our

company priorities over the coming 3 year period to an absolute

Revenue target and adjusted EBITDA margin. Our aim with

these evolved measures is to ensure a clear focus on launch

and ramp-up of new products as well as an improvement in our

adjusted EBITDA margins, driving not only top line performance

but also efficiency in managing our resources, to ensure

sustainable growth. These new financial measures will each

carry a weight of 37.5% or a total of 75% (reducing the weight on

financial targets from 90% in 2022).

UCB | Integrated Annual Report 2022

158

Application of Remuneration Policy in 2022

1. Executive Committee total remuneration

The total remuneration package of the Executive Committee

members consists of the following elements that will be further

outlined below:

Fixed Remuneration

Variable Remuneration

Total

remuneration

From the total remuneration, there is a strong focus on total

direct compensation (base salary plus bonus and long-term

incentives). The total direct compensation mix at target level

places a higher weight on variable elements.

Base Salary Fees

Other

Benefits

One-Year

Variable

(Bonus)

Multi-Year

Variable

(LTI)

Extraordinary

Items

Pension

Expense

UCB | Integrated Annual Report 2022

159

The CEO and Executive Committee target total direct compensation mix is as follows:

30% Salary

27% Bonus 26% Bonus

43%

LTI 33% LTI

CEO

Executive

Committee

41%

Salary

The pay for performance impact can be illustrated as follows for

the CEO and is described in more detail below and the payout

opportunity is similar for other Executive Commitee members:

Maximum

Base salary

Variable pay

Minimum

On target performance 100%

2. Peer group and competitive positioning

UCB refers primarily to a European peer group for comparing

pay policy and decisions (see below) which remains unchanged

since the previous year. A separate U.S. peer group is maintained

to ensure a good understanding of this specific market, given

the international character of our Executive Committee, but is

not the reference for our pay policy, for instance when setting

bonus and LTI target levels.

Both groups include international biopharmaceutical

(pharmaceutical and/or biotechnology) companies with whom

UCB competes for talent. These companies vary in size and

therapeutic area.

We prioritize fully-integrated biopharmaceuticals peer

companies operating in a complex research-driven environment

and which have both development and commercialization

capabilities. Where possible we aim to include companies

competing in the same therapeutic areas.

While we do target companies that broadly reflect UCB’s

size, company size is not the primary factor, given the limited

nature of this group. Regression analysis is therefore used,

where relevant, to adjust the market data to UCB’s size. The

composition of our compensation peer group is regularly

monitored and adjusted as needed, for instance when industry

consolidation leads to less robust benchmarking.

UCB’s competitive positioning policy is to target median pay

levels of this comparator group for all elements of Total Direct

Compensation (base salary + variable remuneration). The

bonus and LTI target levels are benchmarked against European

biopharma levels. The actual compensation for each individual

is determined based on their experience in relation to the

benchmark, as well as their impact on company performance.

European Peer Group

Genmab Leo Pharma A/S

AstraZeneca PLC Merck KGaA

Bayer AG Novartis AG

Chiesi Farmaceutici S.p.A. Novo Nordisk A/S

GlaxoSmithKline PLC Recordati S.p.A.

H. Lundbeck A/S Roche Holding AG

Ipsen SA Sanofi SA

UCB | Integrated Annual Report 2022

160

3. Executive Committee remuneration elements

Pay Element – Fixed Remuneration

Base Salary Base Salary is defined in relation to the specific job dimensions and the median level of

base salary in the market for similar roles. The individual’s impact on the business and

their level of skill and experience is also taken into consideration.

Fees

Any director fees for executive directors are paid on top of the remuneration received as

an Executive. This is only applicable to the CEO.

Other Benefits Executive Committee Members receive benefits in line with UCB’s remuneration

policy, including participation in a healthcare plan, executive life insurance, and

executive perquisites such as a company car. Executive Committee members can also

receive additional in-kind benefits in line with our standard Global Mobility policies.

These amounts can vary from year to year but are reported in this section due to their

recurring nature.

Pay Element – Variable Remuneration Description

Bonus

The bonus target is subject to a double

performance multiplier (not additive)

which rewards the achievement of

corporate and individual objectives.

The target bonus was set at 90% of

base salary for the CEO and 65%

for the other Executive Committee

members.

The overall bonus opportunity is

capped at 175% of the target for the

CEO and the Executive Committee.

Corporate Objectives

To encourage a focus on revenue growth but also on underlying profitability,

UCB considered annual Adjusted Earnings Before Interest Tax Depreciation and

Amortization (“Adj. EBITDA”) as a shared short-term corporate performance metric

for 2022, for the CEO and Executive Committee, as well as the wider workforce.

This target is defined company-wide and is translated into a payout curve which

ensures that only an acceptable range of performance is rewarded. The philosophy

is that Adj. EBITDA, as a proxy for UCB’s underlying profitability, ensures that

the overall bonus plan is self-funding, rewarding collective efforts across the

organization. For performance between the defined payout levels shown, linear

interpolation is used to determine the payout (2022 payout curve):

Adj. EBITDA vs target Payout vs target

<85% 0%

85% 30%

93% 90%

100% 100%

106% 110%

113% 150%

UCB | Integrated Annual Report 2022

161

Pay Element – Variable Remuneration Description

Bonus

Individual Objectives

Individual objectives are defined according to the extent to which annual objectives

have been met, as well as the behaviors demonstrated by the individual in relation

to UCB’s Patient Value principles. The CEO’s individual objectives mainly represent

the overall company objectives, covering both financial and extra-financial

priorities. The CEO’s individual objectives can be summarized under the following

categories, representing the value UCB aims to create for all stakeholders. No

specific weighting is defined per category as we believe that performance needs to

be measured in a holistic way, considering short-term impact and overall long-term

company sustainability. The GNCC and Board consider all relevant elements to

arrive at the individual performance multiplier.

Performance measure Value Creation

Financial priorities Sustainability is our business approach. Our financial

health is key to our overall sustainability and

ability to continue to create value for patients, our

employees, and society, now and into the future.

A strong focus is placed on delivering on the

following financial targets:

• Revenue

• Net Profit

• Net Sales across our product portfolio

• Cashflow generation

Extra-financial priorities Value for patients – building a pipeline of

differentiated solutions and improving patient access

to these solutions

Value for our people – fostering a working

environment where our people can thrive by being

happy, healthy and safe

Value for the planet – transitioning UCB towards a

low carbon and green economy

Other – priorities that span several of the above

such as societal value or other company strategic

goals and personal development goals.

Other Executive Committee members’ goals are derived from the

same goals and adjusted according to their specific area of impact.

UCB | Integrated Annual Report 2022

162

Pay Element – Variable Remuneration Description

Long-Term incentives

The LTI program is a two-tiered

incentive program which includes:

A stock option plan representing

30% of the LTI grant and a

performance share plan for 70%.

Target LTI levels represented

140% of base pay for the CEO

and 80% for the other Executive

Committee Members.

The actual LTI grant size is adjusted from year to year, bearing in mind individual

past performance as a proxy for future impact and value creation, as well as other

factors such as market premiums observed for certain roles. The LTI grant value is

translated into a number of long-term incentives considering the underlying value of

each award. The actual grant can represent a maximum of 150% of the target (i.e. up

to 210% of the current base salary for the CEO and 120% of base salary for the other

Executive Committee members) at the moment of the award determination.

Stock Options

Our option plan has a minimum

vesting period of three years. As

from the moment of vesting the

beneficiary can exercise the option

until 10 years from the date of grant.

Through sustainable performance, the positive evolution of the share price

determines the realizable value of this long-term incentive plan. UCB does not

facilitate entering into derivate contracts related to Stock Options, nor do we hedge

the attached risk, as this is not consistent with the purpose of the Stock Options. For

incumbents based in Belgium, options granted in April 2022 cannot be exercised

before 1 January 2026, and taxation occurs at the moment of grant, as per Belgian

tax legislation. For incumbents based in other countries, options granted in April 2022

cannot be exercised before 1 April 2025. Options expire on the 10th anniversary of

the date of grant.

Performance shares

Performance shares are subject to

a three-year vesting period and vest

upon condition of meeting pre-

determined company targets.

The 2022 grant was based on our performance against three performance criteria:

Adjusted Cumulative Operating Cashflow, Compounded Revenue Growth, both

weighted at 45%, and a Patient Access target representing 10%. The financial criteria

aim to drive a focus on growth and sustainability, so that we can continue to invest

in innovative solutions for patients. The Patient Access KPI represents the importance

we place on doing the right thing for patients, ensuring they have optimum access to

affordable solutions and in a timely manner.

The number of shares awarded is adjusted at the end of the performance period

based on the company’s performance against the targets defined at the time of

grant. If actual company performance is below a specified threshold no shares are

awarded. The maximum vesting level is 150% of the original grant, if results would

significantly exceed the targets.

UCB | Integrated Annual Report 2022

163

Pay Element – Extraordinary Items & Pension Description

Extraordinary items Any non-recurring remuneration for 2022, such as sign-on awards or

termination pay, are reported further in the present remuneration report and

elaborated in our remuneration policy. For instance, the company may decide

to award a sign-on award, via cash or shares, to new Executive Committee

members. This is not an automatic practice and considers various factors such

as losses that the individual would otherwise incur in leaving another employer

or other related negative cashflow effects. Any sign-on awards are deliberated

and approved by the GNCC.

Pension The CEO participates in a cash balance retirement benefit plan which is fully

funded by UCB and in the UCB Executive supplementary defined contribution

plan. The other Executive Committee members each participate in the

pension plans available in their country of contract; those incumbents based in

Belgium participate in the same plans as the CEO.

4. Other policy provisions

Clawback and malus provisions

Clawback and malus provisions are in place since 2021 for

the variable pay plans of our CEO and Executive Committee

members.

This means that the Board of Directors may decide – subject

to applicable law – to retain any unpaid or unvested incentive

compensation (malus), or to recover incentive compensation

that has been paid or has vested (clawback) in case of (i)

evidence of fraud or serious misconduct and/or (ii) material

breach of UCB’s Code of Conduct and Dealing Code, and/or (iii)

engaging in conduct or actions that can reasonably be expected

to cause reputational harm to UCB and/or in case of material

negative restatement of the company’s financial results.

Shareholding guidelines

While the weight of LTI in our overall pay mix results in our

Executive Committee members having a meaningful stake

in unvested (and vested) LTI at any moment, in 2021 we

introduced shareholding guidelines for our CEO and Executive

Committee members.

The requirement is for the current CEO and Executive

Committee members to own a minimum multiple of their

annual gross base salary in UCB shares (owned from vesting of

stock awards, performance shares or exercised stock options),

reached over a building period of 5 years and maintaining the

threshold afterwards. The requirement is to reach 150% of

annual gross base salary for CEO and 50% of annual gross base

salary for Executive Committee members.

Termination Arrangements

Given the international character of our Executive Committee

as well as the dispersal of our various activities across different

geographies our members have agreements governed by

different legal jurisdictions.

A Belgian service contract was established during 2014 for

Jean-Christophe Tellier and maintains similar termination

conditions to those in place under his previous U.S. employment

agreement, comprising a lump sum equal to 18 months base

compensation plus the average of the actual bonuses paid for

the three previous years if the contract is terminated by the

company or if there is a change of control of UCB.

The agreements of Emmanuel Caeymaex and Iris Löw-Friedrich

were signed before the entry into force of the Belgian Corporate

Governance law of 6 April 2010 which limits the level of

termination indemnities.

Emmanuel Caeymaex has no specific termination provisions

in his Belgian contract. In case of involuntary termination, local

employment law and practices apply.

Iris Löw-Friedrich has a German employment agreement

which provides a six months’ notice period and a termination

indemnity equal to one-year base salary and bonus.

Jean-Luc Fleurial, Sandrine Dufour, Dhaval Patel, and Charl van

Zyl have Belgian employment contracts including a termination

clause which entitles them to a severance payment of

12 months base salary and bonus if the contract is terminated by

the company or of there is a change of control of UCB.

Kirsten Lund-Jurgensen and Bill Silbey hold a U.S. employment

agreement, and each has a termination clause which provides

for a severance payment of 12 months base salary and target

bonus if the contract is terminated by the company or if there

would be a change in control in UCB.

UCB | Integrated Annual Report 2022

164

5. Non-Executive Directors

The level of pay for the Board of Directors is regularly assessed

against both European peer companies as well as companies

listed on Euronext Brussels benchmark stock market index

(BEL 20). Peer company data constitutes the primary reference,

given our need to attract experts with a deep knowledge of our

industry. The median levels of this peer group are the target.

As per the 2021 Remuneration Policy and subsequent

adjustment to the Committee Chair fees approved at the

General Meeting of Shareholders on April 28, 2022, Non-

Executive Directors are entitled to the following fees:

In accordance with the policy, Non-Executive Board members

do not receive variable or equity-related remuneration, based on

the position that shareholding could create a conflict of interest

for long-term mandates, nor are they entitled to receive benefits.

Board members residing in a country where the time zone

difference with Belgium is five hours or more receive a special

travel allowance.

Board Committee fees Other

Annual fees

Board

Attendance

fees Audit Scientific GNCC

Travel

Allowance

Chair

€   - - - -

Vice Chair

€   €  

Directors

€   €  

Chair of Committee

€   €   €  

Member of Committee

€   €   €  

Annual Special Travel

Allowance*

€  

* Cumulative with annual board fees except for Chair, as included in annual board fees

UCB | Integrated Annual Report 2022

165

2022 Remuneration Outcomes for the CEO and the Executive

Committee Members

1. Total Remuneration summary

The below provides an overview of the total remuneration of

our CEO and Executive Committee members:

1 Fixed Remuneration 2 Variable Remuneration

3 Extraordinary

Items

4 Pension

Expense

5 Total

remuneration

Proportion of

Fixed and Variable

Remuneration

Incumbent

Name –

Position Base pay Fees

Other

benefits

One-Year

Variable

(Bonus)

Multi-Year

Variable (LTI)

Fixed [(1

+ 4) / (5

– 3)]

Variable

[2 / (5 -3)]

Jean-

Christophe

Tellier – CEO

€ 1 228 784 € 86 000 € 730 728 € 884 110 € 2 472 040 € 0 € 406 868 € 5 808 530 42% 58%

Other

Members of

the Executive

Committee

€ 5 147 952 € 0 € 1 898 058 € 2 222 752 € 5 324 261 € 0 € 2 132 694 € 16 725 717 55% 45%

As a comparison to the 2021 Remuneration Report, the CEO’s

total direct compensation (Base Pay + Bonus + LTI) for 2022

amounts to € 4 584 934 (excluding pension contributions and

other benefits), compared to €4 613 665 in 2021, representing

an overall reduction of total direct compensation of 1% vs 2021

and a reduction of 7% of Total Remuneration, vs 2021. The 2022

bonus was 39% lower than the previous year due largely to

headwinds that impacted Adj. EBITDA, which forms the basis for

the Corporate Performance Multiplier and for which the result

compared to the 2022 target was in the bracket (landing in the

bracket 85% - 93% of Adj. EBITDA vs target, as shown above in

the section Remuneration in 2022).

The LTI granted (considering the value on the grant date of April

1, 2022) was 25% higher than the previous year, driven largely by

a sharp share price increase between the award determination

and the April 1 grant. This value represents the share price on the

grant date (i.e. a spot rate of €108.4 per share), with the potential

realizable value to be determined in 2025.

The aggregated Executive Committee compensation (base

salary + bonus + LTI) for 2022 amounts to: € 12 694 965 (or

+4%) (excluding pension contributions and other benefits),

compared to €12 155 964 in 2021.

UCB | Integrated Annual Report 2022

166

Base Salary

The table below show the 2022 base salary levels of the CEO

and the Executive Committee:

Incumbent Name – Position 2022

Jean-Christophe Tellier – CEO € 1 228 784

Other Members of the Executive Committee € 5 147 952

The CEO’s salary evolved by 5% (from EUR 1 173 917 in 2021)

and by 8% for the other Executive Committee members

(from EUR 4 749 968 in 2021) according to observed market

movements and in line with the overall salary movements of the

broader workforce.

Fees

The CEO is also entitled to director fees as Board member of

UCB SA. For 2022, these fees amounted to € 86 000 (€ 80 000

in annual fees and € 6 000 in presence fees).

Other Benefits

Insurances, as well as benefits due in line with our standard

Global Mobility policies and our remuneration policy, are

included in “other benefits”.

For the CEO these other benefits represented an amount of

€ 730 728, while for other Executive Committee members this

amounted to a total aggregate amount of € 1 898 058.

Base Salary Fees

Other

Benefits

A. Fixed Remuneration

UCB | Integrated Annual Report 2022

167

B. Variable Remuneration

One-Year

Variable

(Bonus)

Multi-Year

Variable

(LTI)

Bonus (“One-Year Variable”) 2022 performance against

targets

The achievement of performance targets was measured during

the period that started on 1 January 2022 and ended on

31 December 2022. In line with the remuneration policy,

corporate objectives are defined by the percentage of actual

Adj. EBITDA versus the budget, at constant exchange rates. As

the target set for 2022 was not met, the Company Performance

Multiplier is significantly below target level (for the CEO resulting

in a reduction of bonus by 39% vs the previous year and for the

ExCom 32% below).

The payout level for the individual objectives for the CEO were

proposed to the Board by the GNCC based on the performance

assessment at the end of the cycle as summarized below in the

key priority areas for 2022. The outcome for 2022 is as follows:

CEO Bonus

Target

% of Base Salary

Actual

% of Base Salary

Actual

Amount

Jean-Christophe Tellier 90% 65% € 884 110

UCB | Integrated Annual Report 2022

168

Performance measure 2022 CEO performance against key priority areas

Financial priorities UCB continued to grow in a sustainable way, but due to exceptional internal and external

headwinds, several measures of our financial performance landed below our initial guidance as

well as internally defined targets. Thanks to the efforts and agility of the organization UCB was

able to continue investing heavily in innovation, R&D as well as future launches.

UCB’s revenue, excluding the products impacted by loss of exclusivity in 2022 (VIMPAT

** US/

EU and E KEPPRA

** Japan), showed further growth and included also the newly launched

BIMZELX

*; and FINTEPLA

**, stemming from the acquisition in March 2022.

The adjusted EBITDA was impacted by the lower revenue due to the loss of exclusivity of

certain products, bimekizumab launch delay in the US, continued marketing and selling

expenses for preparation of upcoming/ongoing launches and pipeline progress. UCB was

also impacted by external macroeconomic elements. However, there was a continued

agile resource reallocation across the organization to be able to sustain our resilience. The

acquisition of Zogenix, Inc. was, as planned, not profit accreditive yet in 2022.

Value for patients Continuously innovate to bring differentiated solutions with unique outcomes and ensure

access for all who need our solutions, in a way which is viable for UCB, for patients, for

communities and for society.

• We continued to expand our clinical pipeline, now encompassing 9 clinical development

medicines. Additionally, potential new indications and treatment options are undergoing

regulatory review – set to help people live their best possible lives.

• While the target number of candidates was not delivered into the development pipeline,

exciting progress was made in the field of Gene Therapy. In addition, UCB unveiled a

new collaboration with Swiss biotechnology company, GliaPharm, which specializes in

developing treatments for neurological and psychiatric disorders. This collaboration shows

just one of the ways in which partnerships can enable UCB to develop solutions that shift

from providing symptomatic relief to developing therapies that address the underlying

causes of certain epilepsies.

• In 2022, we gained reimbursement for new patients across geographies as measured by

our Access Coverage Performance Index. We started to track the time it takes us to obtain

payers’ decision for coverage and reimbursement of new UCB medicines and here we see

opportunities to continue to improve our ability to gain reimbursement decisions earlier than

industry benchmark.

• We exceeded our targets with increased positive feedback from patients who benefit from

support via our UCBCares platform and other patient support services, measured through an

improved net promoter score.

• We successfully launched a new social business approach in 2022, aimed to improve

epilepsy care in Mumbai, India for underserved patients in a way that aims to be financially

self-sustaining over time.

Accelerate our digital business transformation in core operations and breakthrough

initiatives:

• Up to 30 weeks was saved in clinical studies thanks to the implementation of digital

solutions.

• We have demonstrated the first successful application of new AI models in the New

Biological Entity (NBE) space, confirming the enormous potential of AI in New Biological

Entity (NBE) drug discovery and promoting UCB among the leaders in the field.

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

UCB | Integrated Annual Report 2022

169

Performance measure 2022 CEO performance against key priority areas

Value for patients Supply performance (Supply Received On Time in Full)

• Results continue to be at target (99.5%) for product availability, with reliable delivery

performance of our third-party logistics with limited challenges.

Value for our people Further progress on our Diversity, Equity and Inclusion ambitions to increase our impact:

Our global DE&I employee survey showed encouraging improvements and overall we were

above target for our various inclusion drivers, with an increase of at least 3% on the prior year

for employees’ sense of belonging, fair treatment, psychological safety and diverse

recruitment practices.

We also reached our “DE&I journey” targets: empowering and activating our internal DE&I

network with around of our 70% of senior leaders and HR community onboarded on our

DE&I journey and with 6 DE&I local councils established while 6 others are emerging.

We were slightly below target on our gender diversity goals at executive levels. While a

majority of leadership teams are within or very close to a range of gender balance of between

40%-60%, our target of 80% of these teams being in this range was not met.

Progress on our health, safety and wellbeing goals

Overall, UCB’s HSWB Index result in 2022 decreased to 80.4%, from 81.9% in 2021, which was

below our target. This was mainly due to a reduction in the HSWB indicator linked to the results

of our global employee survey. We understand that external geopolitical and socio-economic

tensions as well as the unexpected news about bimekizumab in the US and our subsequent

mitigations plans, played a role in this reduction. Our Lost Time Incident Rate however was in

line with our internal target. As a result, we achieved a Safety Performance Indicator score of

100%. Despite the overall reduction in the index, which we will continue to focus on in 2023,

the negative modifier was not triggered, based on the threshold of 80% in place.

Value for the Planet Our environmental ambitions are to be carbon neutral for the emission we directly control,

to partner with suppliers with the same value and ambition as us, and to reduce our waste

generation and our water consumption in absolute value by 2030 (vs. a 2015 baseline)

• Business travel: We reduced the CO

emissions of business travel by – 68% compared to

pre-Covid, ahead of our target of -50%.

• Suppliers: We met our target of having 30% of supplier-related emissions committed to

science-based carbon reduction targets by year-end.

• Assets: We exceeded our product scorecards targets by year-end.

Other goals Recognition of our sustainability approach:

• We were able to maintain the current rating for Sustainalytics, CDP and ISS ESG ratings

and also improved our MSCI rating from A to AA, positioning UCB in the top quartile of the

pharmaceutical industry.

Overall, we believe that in light of our context, we made solid

progress on our commitments to creating sustainable value for

patients, our people, shareholders and society.

The CEO proposed individual performance multipliers for each

of the other Executive Committee members to the GNCC

for consideration prior to Board endorsement. The combined

total value of cash bonuses paid to the Executive Committee

amounted to € 2 222 752.

UCB | Integrated Annual Report 2022

170

LTI (“Multi-Year Variable”)

In 2022, the CEO and Executive Committee members were

awarded an LTI grant between the LTI target and the maximum

policy value.

A) Grant made in 2022

The table below details the number of stock options and

performance shares that were granted in 2022:

Stock Options Performance Shares

Incumbent Name –

Position

Number

of Stock

Options

Granted

Vesting

Date

Strike

Price

Binomial

value per

Unit

Binomial

Value at

Grant

Number of

Performance

Granted

Vesting

Date

Value per

Unit

Value at

Grant

Total

Value at

Grant

Jean-Christophe

Tellier – CEO

27 892 01-Jan-26 102.04 26.59 € 741 648 20 778 01-Apr-25 83.28 € 1 730 392 € 2 472 040

Emmanuel Caeymaex 7 937 01-Jan-26 102.04 26.59 € 211 045 5 913 01-Apr-25 83.28 € 492 435 € 703 479

Sandrine Dufour 9 008 01-Jan-26 102.04 26.59 € 239 523 6 711 01-Apr-25 83.28 € 558 892 € 798 415

Jean-Luc Fleurial 6 211 01-Jan-26 102.04 26.59 € 165 150 4 627 01-Apr-25 83.28 € 385 337 € 550 487

Iris Loew-Friedrich 7 699 01-Apr-25 102.04 26.59 € 204 716 5 735 01-Apr-25 83.28 € 477 611 € 682 327

Kirsten Lund-

Jurgensen

5 746 01-Apr-25 108.45 26.59 € 152 786 4 281 01-Apr-25 83.28 € 356 522 € 509 308

Dhaval Patel 8 319 01-Jan-26 102.04 26.59 € 221 202 6 197 01-Apr-25 83.28 € 516 086 € 737 288

Bill Silbey 6 764 01-Apr-25 108.45 26.59 € 179 855 5 039 01-Apr-25 83.28 € 419 648 € 599 503

Charl van Zyl 8 388 01-Jan-26 102.04 26.59 € 223 037 6 249 01-Apr-25 83.28 € 520 417 € 743 454

1 Average of the closing prices between 2 March and 31 March of the year or closing price of 31 March as specified by Belgian or other relevant legislation

2 Binomial valuation: an objective technique for pricing long-term incentives and which determines a fair value of the stock price over the life of a long-term incentive

UCB | Integrated Annual Report 2022

171

B) LTI Vesting in 2022

The table below details the number of stock options, stock

awards and performance shares, granted to the Executive

Committee members in previous years (reported in previous

annual reports) and which have vested during the calendar year

2022 (not to be aggregated with the information in the above

table which details the long-term incentives granted in 2022):

Stock options Stock awards

Grant

Date

Vesting

date

Number

vested (not

exercised)

Exercise

price

Award

date

Vesting

date

Number

vested

Share market

value upon

vesting

Total value

upon vesting

(€)

Jean-Christophe Tellier

– CEO

01-Apr-18 01-Jan-22 44 741 66.18

Emmanuel Caeymaex 01-Apr-18 01-Jan-22 11 741 66.18

Sandrine Dufour 01-Jul-20 01-Jul-22 4 000 81.27 325 080

Jean-Luc Fleurial 01-Apr-18 01-Jan-22 7 519 66.18

Iris Löw-Friedrich 01-Apr-19 01-Apr-22 10 739 76.09

Kirsten Lund-Jurgensen 01-Aug-19 01-Aug-22 7 000 75.27 526 890

Dhaval Patel 01-Apr-18 01-Jan-22 15 273 66.18

Dhaval Patel

Bill Silbey 01-Apr-19 01-Apr-22 8 947 76.56

Charl van Zyl 01-Apr-18 01-Jan-22 13 929 66.18

1 Sandrine Dufour joined UCB after the 2018 grant. Kirsten Lund-Jurgensen joined UCB after the 2019 LTI grant.

2 Kirsten Lund-Jurgensen and Sandrine Dufour joined UCB after the 2019 LTI grant.

3 Market value of the UCB share on the date of vesting defined as the average of the high and the low price of the UCB share on that date unless specified by local legislation.

UCB | Integrated Annual Report 2022

172

Stock options Stock awards

Grant

Date

Vesting

date

Number

vested (not

exercised)

Exercise

price

Award

date

Vesting

date

Number

vested

Share market

value upon

vesting

Total value

upon vesting

(€)

Jean-Christophe Tellier

– CEO

01-Apr-18 01-Jan-22 44 741 66.18

Emmanuel Caeymaex 01-Apr-18 01-Jan-22 11 741 66.18

Sandrine Dufour 01-Jul-20 01-Jul-22 4 000 81.27 325 080

Jean-Luc Fleurial 01-Apr-18 01-Jan-22 7 519 66.18

Iris Löw-Friedrich 01-Apr-19 01-Apr-22 10 739 76.09

Kirsten Lund-Jurgensen 01-Aug-19 01-Aug-22 7 000 75.27 526 890

Dhaval Patel 01-Apr-18 01-Jan-22 15 273 66.18

Dhaval Patel

Bill Silbey 01-Apr-19 01-Apr-22 8 947 76.56

Charl van Zyl 01-Apr-18 01-Jan-22 13 929 66.18

Performance shares

Plan specification Award date

Vesting date

Performance

period

Total number

of shares

vested

Vesting

Share market

value upon

vesting

Total

value upon

vesting (€)

Performance Shares 01-Apr-19 01-Apr-22 2019-2022 37 442 135% 108.08 4 046 731

Performance Shares 01-Apr-19 01-Apr-22 2019-2022 9 921 135% 108.08 1, 072 262

Performance Shares 01-Apr-19 01-Apr-22 2019-2022 7 942 135% 108.08 858 371

Performance Shares 01-Apr-19 01-Apr-22 2019-2022 10 148 135% 107.05 1 086 343

Performance Shares 01-Apr-19 01-Apr-22 2019-2022 13 364 135% 108.08 1 444 381

Phantom Performance

01-Oct-19 01-Oct-22 2019-2022 5 600 80% 71.11 398 216

Performance Shares 01-Apr-19 01-Apr-22 2019-2022 8 455 135% 108.08 913 816

Performance Shares 01-Apr-19 01-Apr-22 2019-2022 11 657 135% 108.08 1 259 889

The performance shares that vested in April 2022 relate

to the April 2019 grant. The vesting of those performance

shares was subject to three-year performance against the

following criteria for the years 2019 - 2021:

• Adjusted Cumulative Operating Cashflow (50% weight)

– 120% payout as we reached a positive level of cashflow

over the period 2019-2021 compared to the target (as set

in 2019). The target and landing are commercially sensitive

and therefore not disclosed.

• Compounded Annual Revenue Growth (50% weight ) –

150% payout as we exceeded our target range for revenue

growth (CAGR) of 5-6% over this period, with a final result

in excess of 7%.

Based on the excellent performance against each of the

targets, the number of shares that vested was equal to

135% of the target number of shares conditionally granted, due

to performance above target on Cashflow Conversion ratio and

at target against the other three performance criteria.

As mentioned above, for the plan 2020-2022 which would be

due to vest on April 1, 2023, the plan will vest at 0% given that

the minimum threshold of performance for the two above-

mentioned measures was not met.

C) LTI Forfeited in 2022

There were no stock options, stock awards and performance

shares granted to the Executive Committee members in

previous years and which were forfeited in 2022.

UCB | Integrated Annual Report 2022

173

E. CEO and Executive Committee pay comparison

Remuneration of Executive Committee, Employees and

Company Performance over 5 years

The below table is a summary of the evolution of total

remuneration of our CEO, Executive Committee, our average

employee and compared to company performance over the

last five years, represented here by year on year growth of

revenue and adj. EBITDA.

    

Remuneration of CEO* €    €    €    €    €   

Change year on year (YoY) .% .% .% -.% -.%

Remuneration of members of the Executive

Committee **

€    €    €    €    €   

Change YoY -.% .% -.% -.% -.%

Company Performance

Revenue (Change YoY)

at real rate % % % % -%

at constant rate % % % % -%

Adj. EBITDA (Change YoY)

at real rate % % % % -%

at constant rate % % -% % -%

Total Remuneration of employees

(in EUR Millions)

     

FTE      

Average cost per FTE (IFRS) €   €   €   €   €  

Change YoY -.% .% -.% .% .%

C. Extraordinary Items

Extraordinary

Items

Termination payments

There were no termination payments made in 2022.

Sign-on fees

There were no sign-on fees awarded in 2022.

D. Pension expense

Pension

Expense

Incumbent Name – Position

Pension

Expense

Jean-Christophe Tellier – CEO € 406 868

Other Members of the Executive Committee € 2 132 694

* Board fees are reported as part of the total remuneration of CEO**The CEO 2020 remuneration includes the exceptional item referenced in the “other benefits” section above

**Executive Committee composition has varied in recent years.

We note that terminations payments have been excluded from Executive Committee remuneration, due to their non-recurrent nature. Average employee remuneration is calculated on the

basis of actual employee salary and benefit costs (excluding employer social security charges and CEO remuneration), divided by the number of employees, on a year by year basis.

UCB | Integrated Annual Report 2022

174

Total Remuneration of CEO versus Lowest Remunerated

Employee

The below table shows a comparison of the 2022 remuneration

of our CEO (in €), to the 2022 remuneration of the lowest paid

fulltime UCB SA employee (in €). The remuneration includes

fixed and variable remuneration as well as employee benefits,

excluding employer social security charges.

F. CEO and Executive Committee Share-based Remuneration

Shareholding Guidelines

In 2021 UCB implemented shareholding guidelines for its CEO

and Executive Committee members. Each member has 5 years

to meet their respective requirement, since the inception of

this guideline (i.e. April 2026). Currently the CEO does meet this

requirement and so do the majority of longer serving members

of the committee (i.e. those with 5+ years of service).

LTI Information

The tables below detail the opening and closing balance, as well

as movements during the year in of share-based remuneration

for each of the Executive Committee Members (both current

and former).



Ratio of Total Remuneration of CEO versus Lowest Remunerated Employee :

UCB | Integrated Annual Report 2022

175

The main conditions of the share option plans Information regarding the reported financial year

Incumbent name Plan specification Grant date Vesting date Exercise period Strike price (€)

Opening balance During the year Closing balance

Share options

outstanding

begin year

Share options awarded Share options vested

Share options

exercised

Share options

unvested

Share options

vested but

unexercised

Number Value (€)

Jean-Christophe Tellier – CEO

Stock Appreciation rights

01-Apr-13 01-Apr-16 7 years 49.80

11 272 11 272

01-Apr-14 01-Apr-17 7 years 58.12 30 656 30 656

Stock Options

01-Apr-15 01-Jan-19 6.25 years 67.35

26 800 26 800

01-Apr-16 01-Jan-20 6.25 years 67.24 38 792 38 792

01-Apr-17 01-Jan-21 6.25 years 70.26 39 273 39 273

01-Apr-18 01-Jan-22 6.25 years 66.18 44 741 44 741 349 427 44 741

01-Apr-19 01-Jan-23 6.25 years 76.09 39 623 39 623

01-Apr-20 01-Jan-24 6.25 years 76.21 40 214 40 214

01-Apr-21 01-Jan-25 6.25 years 79.99 30 490 30 490

01-Apr-22 01-Jan-26 6.25 years 102.04 27 892 741 648 27 892

Emmanuel Caeymaex Stock Options

01-Apr-15 01-Jan-19 6.25 years 67.35

5 191 5 191

01-Apr-16 01-Jan-20 6.25 years 67.24 9 904 9 904

01-Apr-17 01-Jan-21 6.25 years 70.26 10 822 10 822

01-Apr-18 01-Jan-22 6.25 years 66.18 11 741 11 741 91 697 11 741

01-Apr-19 01-Jan-23 6.25 years 76.09 10 499 10 499

01-Apr-20 01-Jan-24 6.25 years 76.21 10 966 10 966

01-Apr-21 01-Jan-25 6.25 years 79.99 8 551 8 551

01-Apr-22 01-Jan-26 6.25 years 102.04 7 937 211 045 7 937

Sandrine Dufour Stock Options

01-Apr-21 01-Jan-25 6.25 years 79.99

8 128 8 128

01-Apr-22 01-Jan-26 6.25 years 102.04 9 008 239 523 9 008

Jean-Luc Fleurial Stock Options

01-Apr-18 01-Jan-22 6.25 years 66.18

7 519 7 519 58 723 7 519

01-Apr-19 01-Jan-23 6.25 years 76.09 8 405 8 405

01-Apr-20 01-Jan-24 6.25 years 76.21 8 695 8 695

01-Apr-21 01-Jan-25 6.25 years 79.99 6 626 6 626

01-Apr-22 01-Jan-26 6.25 years 102.04 6 211 165 150 6 211

Iris Loew-Friedrich Stock Options

01-Apr-13 01-Apr-16 7 years 48.69

13 397 13 397

01-Apr-14 01-Apr-17 7 years 58.12 15 666 15 666

01-Apr-15 01-Apr-18 7 years 67.35 15 521 15 521

01-Apr-16 01-Apr-19 7 years 67.24 14 401 14 401

01-Apr-17 01-Apr-20 7 years 70.26 12 554 12 554

01-Apr-18 01-Apr-21 7 years 66.18 14 472 14 472

01-Apr-19 01-Apr-22 7 years 76.09 10 739 10 739 343 541 10 739

01-Apr-20 01-Apr-23 7 years 76.21 11 775 11 775

01-Apr-21 01-Apr-24 7 years 79.99 8 514 8 514

01-Apr-22 01-Apr-25 7 years 102.04 7 699 204 716 7 699

Kirsten Lund-Jurgensen Stock Appreciation rights

01-Apr-20 01-Apr-23 7 years 79.00

8 617 8 617

01-Apr-21 01-Apr-24 7 years 81.12 6 112 6 112

01-Apr-22 01-Apr-25 7 years 108.45 5 746 152 786 5 746

Dhaval Patel Stock Options

01-Apr-18 01-Jan-22 6.25 years 66.18

15 273 15 273 119 282 15 273

01-Apr-19 01-Jan-23 6.25 years 76.09 14 142 14 142

01-Apr-20 01-Jan-24 6.25 years 76.21 13 328 13 328

01-Apr-21 01-Jan-25 6.25 years 79.99 9 157 9 157

01-Apr-22 01-Jan-26 6.25 years 102.04 8 319 221 202 8 319

Bill Silbey Stock Appreciation rights

01-Apr-18 01-Apr-21 7 years 66.18

1 966 1 966

01-Apr-19 01-Apr-22 7 years 76.56 8 947 8 947 282 009 8 947

01-Apr-20 01-Apr-23 7 years 79.00 10 858 10 858

01-Apr-21 01-Apr-24 7 years 81.12 7 701 7 701

01-Apr-22 01-Apr-25 7 years 108.45 6 764 179 855 6 764

Charl Van Zyl Stock Options

01-Apr-18 01-Jan-22 6.25 years 66.18 13 929 13 929 108 785 13 929 0

01-Apr-19 01-Jan-23 6.25 years 76.09 12 336 12 336

01-Apr-20 01-Jan-24 6.25 years 76.21 12 520 12 520

01-Apr-21 01-Jan-25 6.25 years 79.99 9 141 9 141

01-Apr-22 01-Jan-26 6.25 years 102.04 8 388 223 037 0

UCB | Integrated Annual Report 2022

176

The main conditions of the share option plans Information regarding the reported financial year

Incumbent name Plan specification Grant date Vesting date Exercise period Strike price (€)

Opening balance During the year Closing balance

Share options

outstanding

begin year

Share options awarded Share options vested

Share options

exercised

Share options

unvested

Share options

vested but

unexercised

Number Value (€)

Jean-Christophe Tellier – CEO

Stock Appreciation rights

01-Apr-13 01-Apr-16 7 years 49.80

11 272 11 272

01-Apr-14 01-Apr-17 7 years 58.12 30 656 30 656

Stock Options

01-Apr-15 01-Jan-19 6.25 years 67.35

26 800 26 800

01-Apr-16 01-Jan-20 6.25 years 67.24 38 792 38 792

01-Apr-17 01-Jan-21 6.25 years 70.26 39 273 39 273

01-Apr-18 01-Jan-22 6.25 years 66.18 44 741 44 741 349 427 44 741

01-Apr-19 01-Jan-23 6.25 years 76.09 39 623 39 623

01-Apr-20 01-Jan-24 6.25 years 76.21 40 214 40 214

01-Apr-21 01-Jan-25 6.25 years 79.99 30 490 30 490

01-Apr-22 01-Jan-26 6.25 years 102.04 27 892 741 648 27 892

Emmanuel Caeymaex Stock Options

01-Apr-15 01-Jan-19 6.25 years 67.35

5 191 5 191

01-Apr-16 01-Jan-20 6.25 years 67.24 9 904 9 904

01-Apr-17 01-Jan-21 6.25 years 70.26 10 822 10 822

01-Apr-18 01-Jan-22 6.25 years 66.18 11 741 11 741 91 697 11 741

01-Apr-19 01-Jan-23 6.25 years 76.09 10 499 10 499

01-Apr-20 01-Jan-24 6.25 years 76.21 10 966 10 966

01-Apr-21 01-Jan-25 6.25 years 79.99 8 551 8 551

01-Apr-22 01-Jan-26 6.25 years 102.04 7 937 211 045 7 937

Sandrine Dufour Stock Options

01-Apr-21 01-Jan-25 6.25 years 79.99

8 128 8 128

01-Apr-22 01-Jan-26 6.25 years 102.04 9 008 239 523 9 008

Jean-Luc Fleurial Stock Options

01-Apr-18 01-Jan-22 6.25 years 66.18

7 519 7 519 58 723 7 519

01-Apr-19 01-Jan-23 6.25 years 76.09 8 405 8 405

01-Apr-20 01-Jan-24 6.25 years 76.21 8 695 8 695

01-Apr-21 01-Jan-25 6.25 years 79.99 6 626 6 626

01-Apr-22 01-Jan-26 6.25 years 102.04 6 211 165 150 6 211

Iris Loew-Friedrich Stock Options

01-Apr-13 01-Apr-16 7 years 48.69

13 397 13 397

01-Apr-14 01-Apr-17 7 years 58.12 15 666 15 666

01-Apr-15 01-Apr-18 7 years 67.35 15 521 15 521

01-Apr-16 01-Apr-19 7 years 67.24 14 401 14 401

01-Apr-17 01-Apr-20 7 years 70.26 12 554 12 554

01-Apr-18 01-Apr-21 7 years 66.18 14 472 14 472

01-Apr-19 01-Apr-22 7 years 76.09 10 739 10 739 343 541 10 739

01-Apr-20 01-Apr-23 7 years 76.21 11 775 11 775

01-Apr-21 01-Apr-24 7 years 79.99 8 514 8 514

01-Apr-22 01-Apr-25 7 years 102.04 7 699 204 716 7 699

Kirsten Lund-Jurgensen Stock Appreciation rights

01-Apr-20 01-Apr-23 7 years 79.00

8 617 8 617

01-Apr-21 01-Apr-24 7 years 81.12 6 112 6 112

01-Apr-22 01-Apr-25 7 years 108.45 5 746 152 786 5 746

Dhaval Patel Stock Options

01-Apr-18 01-Jan-22 6.25 years 66.18

15 273 15 273 119 282 15 273

01-Apr-19 01-Jan-23 6.25 years 76.09 14 142 14 142

01-Apr-20 01-Jan-24 6.25 years 76.21 13 328 13 328

01-Apr-21 01-Jan-25 6.25 years 79.99 9 157 9 157

01-Apr-22 01-Jan-26 6.25 years 102.04 8 319 221 202 8 319

Bill Silbey Stock Appreciation rights

01-Apr-18 01-Apr-21 7 years 66.18

1 966 1 966

01-Apr-19 01-Apr-22 7 years 76.56 8 947 8 947 282 009 8 947

01-Apr-20 01-Apr-23 7 years 79.00 10 858 10 858

01-Apr-21 01-Apr-24 7 years 81.12 7 701 7 701

01-Apr-22 01-Apr-25 7 years 108.45 6 764 179 855 6 764

Charl Van Zyl Stock Options

01-Apr-18 01-Jan-22 6.25 years 66.18 13 929 13 929 108 785 13 929 0

01-Apr-19 01-Jan-23 6.25 years 76.09 12 336 12 336

01-Apr-20 01-Jan-24 6.25 years 76.21 12 520 12 520

01-Apr-21 01-Jan-25 6.25 years 79.99 9 141 9 141

01-Apr-22 01-Jan-26 6.25 years 102.04 8 388 223 037 0

1 Binomial value on the date of grant

2 The average of the high and the low UCB share price on the vesting date less the exercise price times the number of stock options

3 2017 Stock Options vesting in 2021 was erroneously marked as unexercised in 2021 Remuneration Report

UCB | Integrated Annual Report 2022

177

The main conditions of the stock awards plans Information regarding the reported financial year

Incumbent name Plan specification Award date

Vesting date

Opening balance During the year Closing balance

Stock awards

outstanding –

begin year

Stock awards awarded Stock Awards vested

Stock awards

unvested

Number Value (€) Number Value (€)

Sandrine Dufour Phantom Stock Awards

01-Jul-20 01-Jul-22

4 000 4 000 325 080

01-Jul-20 01-Jul-23 4 000 4 000

Kirsten Lund-Jurgensen Stock Awards 01-Aug-19 01-Aug-22

7 000 7 000 526 890

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178

The main conditions of the stock awards plans Information regarding the reported financial year

Incumbent name Plan specification Award date

Vesting date

Opening balance During the year Closing balance

Stock awards

outstanding –

begin year

Stock awards awarded Stock Awards vested

Stock awards

unvested

Number Value (€) Number Value (€)

Sandrine Dufour Phantom Stock Awards

01-Jul-20 01-Jul-22

4 000 4 000 325 080

01-Jul-20 01-Jul-23 4 000 4 000

Kirsten Lund-Jurgensen Stock Awards 01-Aug-19 01-Aug-22

7 000 7 000 526 890

1 Details on grant in respective Remuneration Report at time of grant

2 The average of the high and the low UCB share price on the vesting date unless specified by local legislation.

UCB | Integrated Annual Report 2022

179

The main conditions of the performance share plans Information regarding the reported financial year

Incumbent name Plan specification Performance period Award date Vesting date

Opening balance During the year Closing balance

Performance

shares outstanding –

begin year

Shares awarded Shares vested

Subject to

Performance

Conditions –

unvested

Number Value (€)

Number Value (€) 

Jean-Christophe Tellier – CEO Performance Shares

2019-2021 01-Apr-19 01-Apr-22

27 735 37 442 4 046 731 0

2020-2022 01-Apr-20 01-Apr-23 27 024 27 024

2021-2023 01-Apr-21 01-Apr-24 24 332 24 332

2022-2024 01-Apr-22 01-Apr-25 20 778 1 730 392 20 778

Emmanuel Caeymaex Performance Shares

2019-2021 01-Apr-19 01-Apr-22

7349 9 921 1 072 262 0

2020-2022 01-Apr-20 01-Apr-23 7 369 7 369

2021-2023 01-Apr-21 01-Apr-24 6 824 6 824

2022-2024 01-Apr-22 01-Apr-25 5 913 492 435 5 913

Sandrine Dufour Performance Shares

2021-2023 01-Apr-21 01-Apr-24

6 486 6 486

2022-2024 01-Apr-22 01-Apr-25 6 711 558 892 6 711

Jean-Luc Fleurial Performance Shares

2019-2021 01-Apr-19 01-Apr-22

5 883 7 942 858 371 0

2020-2022 01-Apr-20 01-Apr-23 5 843 5 843

2021-2023 01-Apr-21 01-Apr-24 5 288 5 288

2022-2024 01-Apr-22 01-Apr-25 4 627 385 337 4 627

Iris Loew-Friedrich Performance Shares

2019-2021 01-Apr-19 01-Apr-22

7 517 10 148 1 086 343 0

2020-2022 01-Apr-20 01-Apr-23 7 913 7 913

2021-2023 01-Apr-21 01-Apr-24 6 794 6 794

2022-2024 01-Apr-22 01-Apr-25 5 735 477 611 5 735

Kirsten Lund-Jurgensen Performance Shares

2020-2022 01-Apr-20 01-Apr-23

5 791 5 791

2021-2023 01-Apr-21 01-Apr-24 4 878 4 878

2022-2024 01-Apr-22 01-Apr-25 4 281 356 522 4 281

Dhaval Patel

Performance Shares

2019-2021 01-Apr-19 01-Apr-22

9 899 13 364 1 444 381 0

2020-2022 01-Apr-20 01-Apr-23 8 957 8 957

2021-2023 01-Apr-21 01-Apr-24 7 307 7 307

2022-2024 01-Apr-22 01-Apr-25 6 197 516 086 6 197

Phantom Performance Shares

2019-2022 01-Oct-19 01-Oct-22

7 000 5 600 398 216 0

2019-2023 01-Oct-19 01-Oct-23 7 000 7 000

2019-2024 01-Oct-19 01-Oct-24 7 000 7 000

Bill Silbey Performance Shares

2019-2021 01-Apr-19 01-Apr-22

6 263 8 455 913 816 0

2020-2022 01-Apr-20 01-Apr-23 7 297 7 297

2021-2023 01-Apr-21 01-Apr-24 6 146 6 146

2022-2024 01-Apr-22 01-Apr-25 5 039 419 648 5 039

Charl Van Zyl Performance Shares

2019-2021 01-Apr-19 01-Apr-22

8 635 11 657 1 259 889 0

2020-2022 01-Apr-20 01-Apr-23 8 413 8 413

2021-2023 01-Apr-21 01-Apr-24 7 295 7 295

2022-2024 01-Apr-22 01-Apr-25 6 249 520 417 6 249

UCB | Integrated Annual Report 2022

180

The main conditions of the performance share plans Information regarding the reported financial year

Incumbent name Plan specification Performance period Award date Vesting date

Opening balance During the year Closing balance

Performance

shares outstanding –

begin year

Shares awarded Shares vested

Subject to

Performance

Conditions –

unvested

Number Value (€)

Number Value (€) 

Jean-Christophe Tellier – CEO Performance Shares

2019-2021 01-Apr-19 01-Apr-22

27 735 37 442 4 046 731 0

2020-2022 01-Apr-20 01-Apr-23 27 024 27 024

2021-2023 01-Apr-21 01-Apr-24 24 332 24 332

2022-2024 01-Apr-22 01-Apr-25 20 778 1 730 392 20 778

Emmanuel Caeymaex Performance Shares

2019-2021 01-Apr-19 01-Apr-22

7349 9 921 1 072 262 0

2020-2022 01-Apr-20 01-Apr-23 7 369 7 369

2021-2023 01-Apr-21 01-Apr-24 6 824 6 824

2022-2024 01-Apr-22 01-Apr-25 5 913 492 435 5 913

Sandrine Dufour Performance Shares

2021-2023 01-Apr-21 01-Apr-24

6 486 6 486

2022-2024 01-Apr-22 01-Apr-25 6 711 558 892 6 711

Jean-Luc Fleurial Performance Shares

2019-2021 01-Apr-19 01-Apr-22

5 883 7 942 858 371 0

2020-2022 01-Apr-20 01-Apr-23 5 843 5 843

2021-2023 01-Apr-21 01-Apr-24 5 288 5 288

2022-2024 01-Apr-22 01-Apr-25 4 627 385 337 4 627

Iris Loew-Friedrich Performance Shares

2019-2021 01-Apr-19 01-Apr-22

7 517 10 148 1 086 343 0

2020-2022 01-Apr-20 01-Apr-23 7 913 7 913

2021-2023 01-Apr-21 01-Apr-24 6 794 6 794

2022-2024 01-Apr-22 01-Apr-25 5 735 477 611 5 735

Kirsten Lund-Jurgensen Performance Shares

2020-2022 01-Apr-20 01-Apr-23

5 791 5 791

2021-2023 01-Apr-21 01-Apr-24 4 878 4 878

2022-2024 01-Apr-22 01-Apr-25 4 281 356 522 4 281

Dhaval Patel

Performance Shares

2019-2021 01-Apr-19 01-Apr-22

9 899 13 364 1 444 381 0

2020-2022 01-Apr-20 01-Apr-23 8 957 8 957

2021-2023 01-Apr-21 01-Apr-24 7 307 7 307

2022-2024 01-Apr-22 01-Apr-25 6 197 516 086 6 197

Phantom Performance Shares

2019-2022 01-Oct-19 01-Oct-22

7 000 5 600 398 216 0

2019-2023 01-Oct-19 01-Oct-23 7 000 7 000

2019-2024 01-Oct-19 01-Oct-24 7 000 7 000

Bill Silbey Performance Shares

2019-2021 01-Apr-19 01-Apr-22

6 263 8 455 913 816 0

2020-2022 01-Apr-20 01-Apr-23 7 297 7 297

2021-2023 01-Apr-21 01-Apr-24 6 146 6 146

2022-2024 01-Apr-22 01-Apr-25 5 039 419 648 5 039

Charl Van Zyl Performance Shares

2019-2021 01-Apr-19 01-Apr-22

8 635 11 657 1 259 889 0

2020-2022 01-Apr-20 01-Apr-23 8 413 8 413

2021-2023 01-Apr-21 01-Apr-24 7 295 7 295

2022-2024 01-Apr-22 01-Apr-25 6 249 520 417 6 249

1 Binomial value of the Performance Shares on 1 April 2022. The binomial valuation is an objective technique for pricing long-term incentives and which determines a fair

value of the stock price over the life of a long-term incentive

2 Market value of the UCB share on the date of vesting defined as the average of the high and the low price of the UCB share on that date unless specified by local legislation.

3 For Iris Loew-Friedrich, the valuation is based on the low price on the vesting date in accordance with the German legislation.

UCB | Integrated Annual Report 2022

181

Remuneration

Directors

Remuneration as

Director

Remuneration as

Committee member

Attendance

rate

( meetings)

Fix

remuneration

as Director

Board

attendance

fees

Travel

Allowance

****

Audit

Committee GNCC

Scientific

Committee

Total

Stefan

Oschmann

Chair * / €   € - €  

Fiona du

Monceau

Vice Chair**

and Chair of

the GNCC

***

/ €   €   €   €  

Jean-Christophe

Tellier

Executive

Director

/ €   €   €  

Pierre L. Gurdjian / €   €   €   €  

Jan Berger / €   €   €   €  

Kay Davies

Chair of the

Scientific

Committee

***

/ €   €   €   €   €  

Albrecht De

Graeve

/ €   €   €  

Susan Gasser / €   €   €   €  

Charles-Antoine

Janssen

/ €   €   € , €  

Cyril Janssen / €   €   €  

Viviane Monges / €   €   € , €  

Jonathan

Peacock

Chair of

the Audit

Committee

***

/ €   €   €   €   €  

Cédric van

Rijckevorsel

/ €   €   €  

Ulf Wiinberg

Chair of

the Audit

Committee

/ €   €   €   €  

€    €   Grand total: €   

* Until 12 December 2022

** also Chair ad interim since 13 December 2022

*** Change in Committee Chair fees as from AGM 2022

**** Fixed lump sum travel allowance as from AGM 2022

2022 Remuneration of Non-Executive Directors

The following table sets out the remuneration received by each

Non-Executive Director in 2022. This includes the fixed annual

payment for Board and Committee memberships, the attendance

fees per Board meeting, and any travel allowances paid.

The fees received by the CEO as Board member of UCB SA are

included in Section 5 under the Remuneration Policy in 2022.

UCB | Integrated Annual Report 2022

182

3.8 Main features of the internal control and risk

management systems of UCB

3.8.1 Internal control

As the governing body of UCB, the Board provides

entrepreneurial leadership to UCB and is responsible for

approving the strategy, goals and objectives of the Company.

This includes overseeing the establishment, implementation and

review of a prudent and effective system of internal controls, as

described herein, as well as the risk management processes as

further described in 3.8.2 below.

The Audit Committee assists the Board in its responsibility of

monitoring the internal control and risk management processes

established by the management of UCB and the UCB Group

as a whole; the effectiveness of the overall internal control

processes of UCB; the overall financial reporting process; the

External Auditor (including its appointment procedure); and the

Global Internal Audit function and its effectiveness.

UCB management is responsible for establishing and

maintaining within UCB adequate internal controls to provide

reasonable assurance regarding the reliable nature of financial

information, compliance with relevant laws and regulations,

in the most efficient manner. The internal controls process is

monitored worldwide by the Internal Controls Department in

an automated manner for system access and segregation of

duties, process control-self assessment testing, and continuous

controls monitoring. Information systems are developed to

support UCB’s long- term objectives and are managed by a

professionally staffed Information Management team.

As an important component of managements system of internal

controls, UCB updates its business plan on an annual basis

and prepares a detailed annual budget for each financial year

that is considered and approved by the Board. A management

reporting system is in place, providing management with

financial and operational performance measurement indicators.

Management accounts are prepared monthly to cover each

major area of the business. Variances from plan and previous

forecasts are analyzed, explained and acted on in a timely

manner. In addition to regular Board discussions, meetings are

held at least monthly by the Executive Committee to discuss

performance, with specific projects being discussed as and

when required.

The Global Internal Audit function provides independent,

objective assurance services designed to evaluate, add value

and improve the internal control environment and operations

of UCB by bringing a systematic, disciplined approach to

the evaluation of, and recommending enhancements to the

governance, compliance, internal control and risk management

processes of UCB.

The Global Internal Audit group undertakes an Audit Plan of

financial, compliance and operational audits and reviews, as

reviewed and approved by the Audit Committee and covering

relevant company activities. The program includes independent

reviews of the systems of internal control and risk management.

The findings and the status of corrective actions taken to

address these are regularly reported in writing to the Executive

Committee, and the status of the completion of the Audit Plan

as well as a summary of the findings and the status of corrective

actions are reported in writing to the Audit Committee at least

once a year.

UCB has adopted formal procedures focused on internal

controls over financial reporting, referred to as the Transparency

Directive process. This process is intended to help minimize

the risk of selective disclosure; to help ensure that all material

information disclosures made by UCB to its investors, creditors

and regulators are accurate, complete, timely and fairly present

the condition of UCB; and to help ensure adequate disclosure of

material financial and non- financial information and significant

events, transactions and risks.

The process consists of a number of activities. Identified key

contributors in the internal control process, which include all

Executive Committee members, are required to certify in writing

that they understand and have complied with the requirements

of UCB related to the financial reporting process, including

providing reasonable assurance of effective and efficient

operations, reliable financial information and compliance with

Laws and regulations. To promote their understanding of the

broad range of potential issues, a detailed checklist is provided

to them to complete and to assist them in their certification.

In addition, a detailed worldwide desk review of Sales, Credits

and related Gross-to-Net accounts, Accounts Receivables,

Trade Inventories, Accruals, Provisions, Reserves and Payments

is performed, and the Finance Directors/representatives of all

individual entities are required to acknowledge in writing that

their financial reporting in these areas is based on reliable data

and that their results are properly stated in accordance with

requirements.

These procedures are coordinated by the Global Internal Audit

function in advance of the issuance of the half-year and annual

accounts. The results of the procedures are reviewed with

the Chief Accounting Office, as well as with key stakeholders

in Finance, the Legal Department and the External Auditor.

Appropriate follow-up of any potential issues identified is

performed and consideration of adjustments to reported

financial information or disclosures is evaluated. The results of

these procedures are reviewed with the CEO and the CFO, and

subsequently with the Audit Committee, prior to the publication

of the accounts.

UCB | Integrated Annual Report 2022

183

3.8.2 Risk management

The whole UCB group and its affiliates worldwide are

committed to providing an effective risk management system

to minimize threats that may impact our ability to achieve our

strategic plans and corporate objectives.

To this effect, the UCB Group incorporates Risk Management

practices as follows:

A global Risk Management policy, applicable for the whole UCB

Group and its affiliates worldwide, describes the commitment of

UCB to provide an effective risk management system across the

UCB Group and articulates the framework and architecture for

managing key risks at UCB.

The Board is responsible for approving the strategy of the

UCB Group and reviewing and monitoring the UCB Group’s

establishment and effective implementation of the risk

management systems and processes. The Audit Committee

reviews on a regular basis the areas where risks could

significantly affect the financial situation or reputation of the

UCB Group.

The Audit Committee monitors the overall risk management

process of UCB. The Executive Committee is responsible for

implementing the risk management strategy and objectives, as

well as championing the prioritization, control and review of

risks critical to UCB’s success. The Global Internal Audit function

is responsible for independently and regularly reviewing as well

as validating the risk management process in UCB and jointly

agreeing with the business functions on actions to mitigate and

control assessed risks.

The Head of Enterprise Risk Management provides periodic

updates to the Executive Committee and, on a periodic basis,

to the Audit Committee as well as to the Board. The Risk2Value

Table and Strategic Risk Council, consisting of management

representatives of all business functions, provides strategic

leadership that endorses the enterprise level risk identification,

assessment, prioritization and response process, supported by

an enterprise risk management system to effectively assess,

report and manage actual or potential risks or exposures. The

sources of risk information include the assessment from the

business areas (bottom-up), input from executive leadership

(top-down) and the external context for the organization

(outside-in). Ownership and accountability for risk at each

level sits with the relevant leadership team and every top risk

is overseen by a member of the Executive Committee who

is accountable for understanding the nature of the risk and

enabling our response to it. The Enterprise Risk Management

group continually assesses its governance structure and

stakeholder alignment to ensure the most robust assessments,

prioritization and responses are achieved.

3.9 Private investment transactions and trading

in UCB shares

The Board has approved a Dealing Code to prevent insider

trading offences and market abuse, particularly during the

periods preceding the publication of results or information that

would likely have an effect on the price of UCB securities or, as

the case may be, the price of the securities issued by a third-

party company.

In 2016, a new Dealing Code has been approved by the Board

to reflect the rules of the EU Regulation No 596/2014 on

Market Abuse, Directive 2014/57/EU on criminal sanctions for

market abuse and the Belgian Law of August 2, 2002 on the

supervision of the financial sector and on financial services,

as amended by the Law of June 27, 2016, which entered into

force on July 3, 2016. During 2017, UCB reviewed the Dealing

Code and updated it to reflect this legislation and to include

considerations relating to ethics in accordance with our Patient

Value Strategy. In 2019, some practicalities have been updated in

the Dealing Code.

The Dealing Code includes rules for Directors, executive

management and key employees which prohibit the dealing in

UCB shares or other financial instruments related to the UCB

share for a designated period preceding the announcement of

its financial results (so-called “closed periods”). It further prohibits

trading in UCB shares or other related securities for persons

who are, or may soon be, in possession of inside information.

The Board has appointed the Group General Counsel (Bill Silbey)

and the Group Secretary General (Xavier Michel) as Insider

Trading Compliance Officers, whose duties and responsibilities

are defined in the Dealing Code.

In accordance with the Dealing Code, the Company has

further established the list of Persons Discharging Managerial

Responsibilities (Directors and members of the Executive

Committee) and the list of key employees, who must inform

and obtain prior clearance from the Insider Trading Compliance

Officer(s) for the transactions on UCB shares and related

securities they intend to make for their own account. Dealings in

the Company securities by the Persons Discharging Managerial

Responsibilities as well as the Persons closely associated

therewith also need to be reported to the Financial Services

and Market Authority (FSMA), the Belgian market supervisory

authority. The procedure for such reporting and the duties

relating thereto are also reflected in the UCB Dealing Code. The

Dealing Code is publicly available on the UCB website.

Our risk management system is based on current plans,

estimates and projections of management and our risk profile

is constantly evolving as internal and external factors and

associated risk assumptions change over time.

To learn more on top risks and environmental and social risks

visit the Risk Management section. To learn more on financial

risks visit the financial Note 5.

UCB | Integrated Annual Report 2022

184

3.10 External audit

The external statutory auditor is the audit firm Mazars

Bedrijfsrevisoren – Réviseurs d’Entreprises CVBA – Avenue du

Boulevard 21, box 8, 1210 Saint-Josse-ten-Noode (Brussels) –

Belgium (“Mazars”), currently represented by Mr. Anton Nuttens.

This auditor was appointed by the General Meeting of April

29, 2021 for a mandate of 3 years (legal term). This mandate is

renewable.

Mazars has been appointed as External Auditor in all affiliates of

the UCB Group worldwide.

The 2022 fees paid by UCB to its External Auditors amounted to:

 – Actuals Audit (€)

Other

Attestation

Related (€)

Tax Services

(€)

Other

Missions

External To

The Audit (€) TOTAL (€)

Mazars Belgium (Auditor)

882 423 66 000 - - 948 423

Mazars Other Related Networks

1 594 121.93 18 985 16 800 - 1 629 906.93

Total

2 476 544.93 84 985 16 800 - 2 578 329.93

UCB | Integrated Annual Report 2022

185

3.11 Information requested under article 34 of

the Royal Decree of November 14, 2007

3.11.1 UCB’s capital structure, with an indication of the

different classes of shares and, for each class of shares, the

rights and obligations attached to it and the percentage of

total share capital that it represents on December 31, 2021

As from March 13, 2014, the share capital of UCB amounts

to € 583 516 974, represented by 194 505 658 shares of

no-par value, fully paid up. All UCB shares are entitled to the

same rights.

There are no different classes of UCB shares (see section 3.2.2).

3.11.2 Restrictions, either legal or prescribed by the Articles of

Association, on the transfer of securities

Restrictions on the transfer of securities only apply to shares

that have not been fully paid up according to article 11 of UCB’s

Articles of Association (the “Articles of Association”) as follows:

(“…)

B) any shareholder holding shares not fully paid who wishes to

transfer all or part of his shareholding, should notify his intention

by registered letter to the Board of Directors, indicating the

name of the candidate to be approved, the number of shares

offered for sale, the price and the proposed terms of sale.

The Board of Directors may, by registered letter, oppose this

sale within a month of such notification, by presenting another

candidate as purchaser to the selling shareholder. The candidate

proposed by the Board will have a right of pre-emption on the

shares offered for sale, unless the proposed seller withdraws

from the sale within 15 days.

The right of pre-emption will be exercisable at a unit price

corresponding to the lower of the two following amounts:

• The average closing price of a UCB ordinary share on the

“continuous trading market” of Euronext Brussels in the

30 stock exchange working days preceding the notification

under the preceding paragraph, reduced by the amount still

to be paid up;

• The unit price offered by the third-party proposed for

approval.

The above-mentioned notification by the Board of Directors

shall be taken as notification of the exercise of the right of pre-

emption in the name and for the account of the purchasing

candidate presented by the Board. The price will be payable

within the month of this notification without prejudice to any

more favorable conditions offered by the third-party presented

for approval.

C) if the Board does not reply within the period of a month from

notification set out in the first paragraph of subsection b) above,

the sale may take place on conditions no less favorable than

those set out in the above-mentioned notification for the benefit

of the candidate presented for approval.

(...”)

To date, the capital of UCB is fully paid up.

3.11.3 Holders of any securities with special control rights and

a description of those rights

There are no such securities.

3.11.4 System of control of any employee share scheme

where the control rights are not exercised directly by the

employees

There is no such system.

3.11.5 Restrictions, either legal or prescribed by the Articles of

Association, on the exercise of voting rights

The existing UCB shares entitle holders thereof to vote at the

General Meeting.

According to article 38 of the Articles of Association, the

following restrictions apply:

“Each share gives the right to one vote. Any person or entity

who acquires or subscribes to beneficial ownership in shares,

whether registered or not, in the capital of the Company,

conferring a right to vote, will be obliged to declare within the

period required by law, the number of shares purchased or

subscribed for, together with the total number of shares held,

when such number in total exceeds a proportion of 3% of the

total voting rights exercisable, before any possible reduction,

at a General Meeting. The same procedure will have to be

followed each time that the person obliged to make the initial

declaration mentioned above increases his voting strength

up to 5%, 7.5%, 10% and subsequently for each additional 5%

of the total voting rights acquired as defined above or when

following the sale of shares, his voting rights fall below one of

the limits specified above. The same notification requirements

will apply to any instrument, option, future, swap, interest term

agreement and other derivative granting its holder the right to

acquire existing securities carrying voting rights pursuant to a

formal agreement (i.e. an agreement that is binding pursuant

to the applicable law) and only on the holders’ own initiative. In

order for the notification requirements to apply, the holder must

either have an unconditional right to acquire existing securities

carrying voting rights or be able to make free use of its right to

acquire them.

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A right to acquire securities carrying voting rights is considered

to be unconditional if it depends merely on an event that can

be caused to happen or prevented from happening by the

holder of the right. These notifications will occur according

to the modalities described in the legislation applicable to the

disclosure of large shareholdings in issuers whose securities are

admitted to trading on a regulated market. Failure to respect this

statutory requirement will be able to be penalized in the manner

laid down in the applicable articles of the law of May 2, 2007 on

the disclosure of shareholdings in issuers whose securities are

admitted to trading on a regulated market.

No-one may at a General Meeting cast a greater number

of votes than those relating to such shares as he has, in

accordance with the above paragraph, declared himself to be

holding, at least twenty days before the date of the Meeting.”

The voting rights attached to UCB shares held by UCB or by its

direct or indirect subsidiaries as the case may be, are, as a matter

of law, suspended.

3.11.6 Agreements between shareholders which are known to

UCB and may result in restrictions on the transfer of securities

and/or the exercise of voting rights

UCB has no knowledge of agreements which may result in

restrictions on the transfer of its securities and/or the exercise of

voting rights.

3.11.7 A. Rules governing the appointment and replacement

of Board members

Under article 15 of the Articles of Association:

“The Company shall be managed by a Board of Directors having

at least three members, whether shareholders or not, appointed

by the general meeting for a term ending at the latest at the end

of the fourth annual shareholders’ meeting following the date

their appointment has become effective. The General Meeting

can, at all times, end the mandate of each director without any

reason and with immediate effect.

Outgoing Directors are eligible for re-election. The period of

office of outgoing Directors, who are not re-appointed, ceases

immediately on the closing of the Ordinary General Meeting.

The General Meeting shall determine the fixed or variable

remuneration of the Directors and the value of their attendance

vouchers, to be charged to operating expenses.”

The General Meeting decides by a simple majority of votes on

these matters.

The rules relating to the composition of the Board of Directors

are detailed in section 3.2 of the Charter as follows:

Composition of the Board of Directors (section 3.2.1 of the

Charter)

”The Board is of the opinion that a number of between ten and

fifteen members is appropriate for efficient decision-making on

the one hand, and contribution of experience and knowledge

from different fields on the other hand. Such a number also

allows for changes to the Board’s composition to be managed

without undue disruption. This is way within the provisions

of the law and the Articles of Association of UCB from which

the Board shall be composed of at least three members. The

General Meeting of Shareholders decides on the number of

Directors, upon proposal of the Board.

A large majority of the Board members are non-executive

Directors. The curricula vitae of the Directors and directorship

candidates are available for consultation on UCB’s website

(www.ucb.com). These curricula vitae mention, for each

Director, the directorships in other listed companies.”

Appointment of Directors (section 3.2.2 of the Charter)

“The Directors are appointed by the General Meeting of

Shareholders, following a proposal by the Board, and upon

recommendation of the GNCC.

In proposing candidates at the General Meeting of Shareholders,

the Board takes particular account of the following criteria:

• a large majority of the Directors are non-executive Board

Members;

• at least three non-executive Directors are independent in

accordance with the general legal definition, the criteria set

out in the 2020 Code, and those adopted by the Board;

• no single Director or group of Directors may dominate

decision-making;

• the composition of the Board guarantees diversity of skills,

background, age and gender, and contribution of experience,

knowledge and ability required for UCB’s specialist

international activities; and

• candidates are fully available to carry out their functions and

do not take more than five directorships in listed companies.

Changes to their other relevant commitments and their new

commitments outside the Company must be reported to the

Chair of the Board and the Company Secretary as they arise.

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The GNCC gathers information, allowing the Board to ensure

that the criteria set out above have been met at the time of the

appointments and renewals and during the term of office.

For each new directorship appointment, the GNCC performs

an assessment of existing and required abilities, knowledge and

experience on the Board. The profile of the ideal candidate is

drawn up based on this assessment and proposed to the Board

for discussion and definition.

When the profile is established, the GNCC selects candidates

that fit the profile in consultation with the Board members

(including the Chair of the Executive Committee) and possibly

using a recruitment firm. Recommendation of final candidates

is made by the GNCC to the Board. When making such

recommendation, relevant information is provided to the Board

(such as curriculum vitae, assessment, a list of the positions

held and, if applicable, any necessary information about the

candidate’s independence).

The Board decides on the proposals to be submitted to

Shareholders’ approval.”

Duration of mandates and age limit (section 3.2.4 of the

Charter)

“Directors are appointed by the General Meeting of

Shareholders for a term ending at the latest at the end of the

fourth annual shareholders’ meeting following the date their

appointment has become effective, and their terms may be

renewed.

Moreover, an age limit of seventy has been stipulated. A director

shall give up his/her current term the day of the Annual General

Meeting of Shareholders following his/her 70th birthday. The

Board may propose exceptions to that rule.”

Procedure for appointment, renewal of terms (section 3.2.5 of

the Charter)

“The process of appointment and re-election of Directors is led

by the GNCC, which makes recommendation to the Board and

strives to maintain an optimum level of abilities and experience

within UCB and its Board.

The proposals for appointment, renewal, resignation or possible

retirement of a Director are examined by the Board based on a

recommendation from the GNCC.

The GNCC assesses for each of the Directors who are

candidate for re-election at the next General Meeting of

Shareholders, their commitment and effectiveness and makes

recommendations to the Board regarding their re-election.

Special attention is given to the evaluation of the Chair of the

Board and the Chairs of the Board committees.

The assessment is conducted by the Chair of the GNCC and

the Vice Chair of the Board or another member of the GNCC,

who have meetings with each of the Directors in their capacity

as a Director and, as the case may be, as Chair or member of a

Board Committee. For the Chair of the Board and of the GNCC,

the assessment is conducted by the Vice Chair of the Board

and a senior independent Director. The sessions are based

on a questionnaire and cover the Director’s role in the

governance of the Company and the effectiveness of

the Board, and, amongst others, how they evaluate their

commitment, contribution and constructive involvement in the

discussions and decision-making.

Feedback is given to the GNCC who then reports to the Board

and makes recommendations as to the proposed re-election.

The Board submits to the General Meeting of Shareholders

its proposals concerning the appointments and renewals of

Directors. These proposals are communicated to the General

Meeting of Shareholders as part of the agenda of the relevant

shareholders meeting.

The General Meeting of Shareholders resolves on each

proposed appointment of Directors separately and the

proposals of the Board in this area are resolved by a majority of

the votes.

In the event of a vacancy during a term, the Board is

empowered to fill the post and to allow its decision to be

ratified at the next General Meeting of Shareholders.

The Board ensures that there is a succession planning for Board

members in place.

Proposals for appointment state whether or not the candidate

is proposed as an executive Director, define the term proposed

for the mandate (i.e., not more than four years, in accordance

with the Articles of Association), and indicate the place where all

useful information in relation to the professional qualifications

of the candidate, in addition to the main functions and

directorships of the candidate, may be obtained or consulted.

The Board also indicates whether the candidate meets the

independence criteria stipulated in the BCCA and the 2020

Code, such as the fact that a Director, in order to qualify as

“independent” may not hold a mandate for a total term of

more than twelve years as a non-executive Board member.

The proposal will be submitted to the General Meeting of

Shareholders to acknowledge such independent character.

These provisions also apply to proposals for appointments

proposals originating from shareholders.

The proposals for appointment are available on UCB’s website

(www.ucb.com).”

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The Charter additionally stipulates that a Director qualifies

as independent if he or she has not had business or other

relations with the UCB group which could compromise his/

her independent judgement. In the assessment of this criterion,

significant status as customer, supplier or shareholder of the

UCB Group is taken into consideration by the Board on an

individual basis.

3.11.7. B. Rules governing the amendment of UCB’s Articles of

Association

The rules governing the amendment of the Articles of

Association are set by the BCCA.

The decision to amend the Articles of Association has to be

made by a general meeting, provided that at least 50% of the

share capital of UCB is present or represented at the meeting, in

principle with a majority of 75% of the votes cast.

If the attendance quorum is not met at the first Extraordinary

General Meeting, a second General Meeting can be

convened and will decide without any attendance quorum

having to be reached.

In exceptional circumstances (for example amendment of

the object of the company, changing of rights of securities),

additional attendance and voting requirements may be

applicable.

3.11.8 Powers of the Board of Directors, in particular to issue

or buy back shares

Powers of the Board of Directors

The Board is UCB’s governing body. It has the power to take

decisions on all matters which the law does not expressly

attribute to the general meeting of shareholders.

In all matters for which it has responsibility, the Board works

in close cooperation with the Executive Committee and

most decisions to be taken by the Board are proposed by the

Executive Committee.

The Executive Committee constitutes UCB’s top management.

It ensures implementation, checking and coordination of

the UCB Group’s strategic plans in the areas of research and

development, operations, financial, administrative, risk and legal

issues, human resources and investment.

The Board’s authorizations to issue or buy back shares

The Extraordinary General Meeting of April 28, 2022 decided

to renew (i) the authorization of the Board (and to amend the

Articles of Association accordingly), for another period of 2

years, to increase the share capital, amongst other by way of

the issuance of shares, convertible bonds or warrants, in one or

more transactions, within the limits and under the conditions

as set out above under section 3.2.4 “Authorized capital”, and

(ii) the authorization of the Board, for another period of 2 years

starting on July 1, 2022 and expiring on June 30, 2024, to

acquire, directly or indirectly, whether on or outside of the stock

exchange, by way of purchase, exchange, contribution or any

other way, up to 10% of the total number of Company’s shares

as calculated on the date of each acquisition, within the limits

and under the conditions as set out above under 3.2.3 “Treasury

shares”. The previous authorization of the Board granted by the

Extraordinary General Meeting of April 30, 2020 remained valid

until June 30, 2022 (see also section 3.2.3 and 3.2.4 above).

3.11.9 Significant agreements to which UCB is a party and

which take effect, alter or terminate upon a change of control

of UCB following a takeover bid, and the effects thereof,

except where their nature is such that their disclosure

would be seriously prejudicial to UCB; this exception shall

not apply where UCB is specifically obliged to disclose such

information on the basis of other legal requirements

• Facility agreement in the amount of € 1 billion between,

amongst others, UCB SA/NV, BNP Paribas Fortis SA/NV,

Commerzbank Aktiengesellschaft, Filiale Luxemburg, ING

Belgium SA/NV and Mizuho Bank Europe N.V. as coordinating

bookrunners, Banco Santander, S.A., Paris Branch, Bank of

America Merrill Lynch International Limited, The Bank of

Tokyo- Mitsubishi UFJ, Ltd., Paris Branch, Barclays Bank PLC,

BNP Paribas Fortis SA/NV, Commerzbank Aktiengesellschaft,

filiale Luxemburg, Crédit Agricole Corporate and Investment

Bank, Belgian Branch, ING Belgium SA/NV, Intesa SanPaolo

Bank Luxembourg S.A, Amsterdam branch, KBC Bank

NV, Mizuho Bank Europe N.V., Sumitomo Mitsui Banking

Corporation and The Royal Bank of Scotland PLC, as

mandated lead arrangers, and Wells Fargo Bank International

Unlimited Company as lead arranger, dated November 14,

2009 (as amended and restated on November 30, 2010, on

October 7, 2011, on January 9, 2014, on January 9, 2018,

on December 5, 2019 and for the last time on December 3,

2021), which change of control clause was last approved by

the General Meeting of April 28, 2022, according to which

any and all of the lenders can, in certain circumstances,

cancel their commitments and require repayment of their

participations in the loans, together with accrued interests

and all other amounts accrued and outstanding thereunder,

following a change of control of UCB SA/NV.

• Euro Medium Term Note Program dated March 6, 2013, with

last update of the base prospectus per October 18, 2022,

for an amount of up to € 5 billion (the “EMTN Program”),

providing for a change of control clause (condition 5 (e)

(i)) under which, for any Notes issued thereunder where a

change of control put clause is included in the relevant final

terms, any holder of such Note and following a change

of control of UCB SA/NV, has a right to redeem that Note

by exercising such put right. Pursuant to article 7:151 of

the BCCA, the above described change of control clause

provided for in the EMTN Program of March 6, 2013 has been

approved by the General Meetings of April 25, 2013, April 24,

2014, April 30, 2015, April 28, 2016, April 27, 2017, April 26,

2018, April 25, 2019, April 30, 2020, April 29, 2021 and April

28, 2022 in respect of any series of Notes to be issued under

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the EMTN Program within the 12 months following such

respective General Meetings and to which such change of

control has been made applicable. A similar approval pursuant

to article 7:151 of the BCCA will be submitted to the General

Meeting of April 27, 2023 in respect of any series of Notes to

be issued under the EMTN Program from April 27, 2023 until

April 26, 2024, if any, and to which, as the case may be, such

change of control would be made applicable.

• Private placement bond 1.000% due October 1, 2027 in the

amount of € 150 million issued on October 1, 2020, issued

under the Euro Medium Term Note Program dated March

6, 2013 and to which the Change of Control clause of said

Program is applicable.

• Institutional bond 1.000% due March 30, 2028 in the amount

of € 500 million issued on March 30, 2021 issued under the

Euro Medium Term Note Program dated March 6, 2013 and

to which the Change of Control clause of said Program is

applicable.

• Senior unsecured retail bonds of UCB SA/NV issued on

October 2, 2013 and maturing October 2, 2023 in the

amount of € 175 717 000 bearing a 5.125% fixed rate, and

which states that in case of change of control (as defined in

the terms and conditions of the offering) the bondholders

have the right to require the issuer to redeem such bonds.

This change of control clause was approved at the general

meeting of April 24, 2014.

• Facility agreement in the amount of € 350 million between

UCB SA/NV as borrower and the EIB, of which the change

of control clause was approved by the General Meeting of

April 28, 2022, and whereby the loan, together with accrued

interests and all other amounts accrued and outstanding

thereunder, could in certain circumstances become

immediately due and payable – at the discretion of the EIB –

following a change of control of UCB SA/NV.

• A term facility agreement in the initial amount of US$ 2 070

million between, amongst others, UCB SA/NV and UCB

Biopharma SRL, as borrowers, and BNP Paribas Fortis SA/NV

and Bank of America Merrill Lynch International Designated

Activity Company as bookrunners dated October 10, 2019

and under which a First Incremental Facility for a total amount

of EUR 90 million between UCB SA and the First Incremental

Facility Lender dated 28 July 2022 as well as a Second

Incremental Facility Agreement for a total amount of EUR

90 million between UCB SA and the Second Incremental

Facility Lender dated 19 January 2023 was established and

of which the establishment does not result in an increase of

the outstanding amount surpassing the initial amount of this

facility, with a change of control clause, under which any and

all of the lenders can, in certain circumstances, cancel their

commitments and require repayment of their participations

in the loans, together with accrued interests and all other

amounts accrued and outstanding thereunder, following a

change of control of UCB SA/NV. The General Meeting of

April 30, 2020 has approved this change of control clause in

accordance with article 7:151 of the BCCA.

• A term facility agreement in the amount of US$ 800 million

between, amongst others, UCB SA/NV and UCB Biopharma

SRL, as borrowers, and BNP Paribas Fortis SA/NV and

Barclays Bank PLC as bookrunners dated January 19, 2022

with a change of control clause, under which any and all

of the lenders can, in certain circumstances, cancel their

commitments and require repayment of their participations

in the loans, together with accrued interests and all other

amounts accrued and outstanding thereunder, following a

change of control of UCB SA/NV, and of which the change of

control clause was approved by the General Meeting of April

28, 2022 in accordance with article 7:151 of the BCCA.

• A Schuldschein loan agreement in the amount of € 108.5

million between UCB SA, as Borrower, UCB Biopharma SRL

as Guarantor, and ING Bank, a branch of ING-DIBA AG as

Original Lender dated 2 November 2022, with a change of

control clause, under which any and all of the lenders can,

in certain circumstances, cancel their commitments and

require repayment of their participations in the loans, together

with accrued interests and all other amounts accrued and

outstanding thereunder, following a change of control of

UCB SA/NV, and of which the change of control clause will

be submitted to the General Meeting of April 27, 2023 in

accordance with article 7:151 of the BCCA.

• A Schuldschein loan agreement in the amount of € 20.5

million between UCB SA, as Borrower, UCB Biopharma SRL

as Guarantor, and ING Bank, a branch of ING-DIBA AG as

Original Lender dated 2 November 2022, with a change of

control clause, under which any and all of the lenders can,

in certain circumstances, cancel their commitments and

require repayment of their participations in the loans, together

with accrued interests and all other amounts accrued and

outstanding thereunder, following a change of control of

UCB SA/NV, and of which the change of control clause will

be submitted to the General Meeting of April 27, 2023 in

accordance with article 7:151 of the BCCA.

• A Schuldschein loan agreement in the amount of € 15.0

million between UCB SA, as Borrower, UCB Biopharma SRL

as Guarantor, and ING Bank, a branch of ING-DIBA AG as

Original Lender dated 2 November 2022, with a change of

control clause, under which any and all of the lenders can,

in certain circumstances, cancel their commitments and

require repayment of their participations in the loans, together

with accrued interests and all other amounts accrued and

outstanding thereunder, following a change of control of

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UCB SA/NV, and of which the change of control clause will

be submitted to the General Meeting of April 27, 2023 in

accordance with article 7:151 of the BCCA.

• A Schuldschein loan agreement in the amount of US$ 20.0

million between UCB SA, as Borrower, UCB Biopharma SRL

as Guarantor, and ING Bank, a branch of ING-DIBA AG as

Original Lender dated 2 November 2022, with a change of

control clause, under which any and all of the lenders can,

in certain circumstances, cancel their commitments and

require repayment of their participations in the loans, together

with accrued interests and all other amounts accrued and

outstanding thereunder, following a change of control of

UCB SA/NV, and of which the change of control clause will

be submitted to the General Meeting of April 27, 2023 in

accordance with article 7:151 of the BCCA.

• The UCB stock awards and performance share plans by

which UCB shares are granted annually by UCB to certain

employees according to grade and performance criteria,

vest according to the rules of both plans after three years,

upon condition that its beneficiary remains in continuous

employment with the UCB group. They also vest upon

change of control or merger. The General Meeting of April

25, 2019 has approved this change of control clause in all

existing and future UCB LTI plans. On December 31, 2022, the

following number of stock awards and performance shares

are outstanding:

• 2 248 397 Stock awards, of which 782 218 will vest in 2023;

• 494 957 Performance shares, of which 186 949 will vest

in 2023.

The change of control clauses in the Executive Committee

members’ contracts, as further described in the Remuneration

report (section 3.7).

3.11.10 Agreements between UCB and its Board members

or employees providing for compensation if the Board

members resign or are made redundant without valid reason

or if the employment of the employees ceases because of a

takeover bid

For more details, see the Remuneration report section (3.7)

on the main contractual terms on hiring and termination

arrangements for the CEO and members of the Executive

Committee. No other agreements provide for a specific

compensation of Board members in case of termination

because of a takeover bid.

In addition to the Executive Committee members identified in

section 3.7, at the end of 2022 only one employee outside the

U.S. benefited from a change of control clause that guarantees

its termination compensation if its employment is terminated

following a public takeover bid.

3.12 Conflicts of interest – Application of article

7:96 of the Belgian Code of Companies and

Associations

EXCERPT FROM THE MINUTES OF THE MEETING OF THE

BOARD HELD ON FEBRUARY 23, 2022

Article 7:96 of the BCCA was applied by the Board of February

23, 2022 in the context of the decisions relating to the CEO

remuneration, the performance bonus and LTI grants (relevant

excerpt from the minutes of the meeting)

“(…)

Prior to any deliberation or decision by the Board of Directors

concerning the approval of the 2021 bonus pay-out, the LTI

vesting and the 2022 LTI plans, metrics and grants, the approval

of the CEO bonus based on 2021 performance, the CEO 2022

base salary and the CEO 2022 LTI grant (including stock options

and performance shares), J.-C. Tellier stated that he had a direct

financial interest in the implementation of said decisions (items

5.3). In accordance with Art. 7:96 of the BCCA, he withdrew

from the meeting of the Board of Directors in order to not

participate in the deliberation and vote relating to these issues.

The Board of Directors established that Art. 7:96 of the BCCA

was applicable to these operations. J.-L. Fleurial also left the

videoconference before any deliberation or decision on

these issues.

5.1.1 Corporate Results 2021 bonus payout/LTI award vesting

and 2022 Targets

Decision: After review, the Board unanimously RESOLVED to

approve the recommendations of the Governance, Nomination

and Compensation Committee (‘GNCC’) relating to (i) the

2021 bonus payout (Corporate Performance Multiplier or

“CPM”) based on the 2021 full year results (Adj. EBITDA), (ii)

the vesting (and total payout) in 2022 relating to the 2019-

2021 Performance Share Plan as well as (iii) the stock award

vesting for the 2019-2021 plan (payout 2022). The Board

further approved, upon recommendation of the GNCC, the

Adj. EBITDA target for 2022 bonus payout and (iii) the metrics

used for the Performance Share Plan 2022-2024 (payout

2025), which will include a new non-financial metric (Access

to Medicines) for 10% (next to Adjusted Cumulative Operating

cash flow (45%) and compounded Annual Revenue Growth

(for 45%)). With respect to the bonus target the Board approved

the proposal of the GNCC to maintain the reference to the adj.

EBITDA target in 2022.

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5.1.2 UCB Long Term Incentives Grants in 2022

Decision: Upon recommendation of the GNCC, the Board

unanimously RESOLVED to approve the following Long-Term

Incentive Plans and the main terms and conditions thereof:

• UCB stock option plan 2022: Issue of 550 000 stock

options, in principle on April 1, 2022 unless exceptional

circumstances, for approximately 492 employees (not taking

into consideration employees hired or promoted to eligible

levels between January 1, 2022 and April 1, 2022).

The exercise price of these options will be the lower of (i)

the average of the closing price over the 30 calendar days

preceding the offer (i.e. in principle from March 1-31, 2022) or

(ii) the closing price of the day preceding the offer (in principle

March 31, 2022).

UCB will determine a different exercise price for those eligible

employees subject to legislation which requires a different

exercise price. Stock options will have a vesting period of

3 years as of the date of grant, except where local legal

regulations may differ.

• Stock awards and Performance Shares (“PSP”) grants 2022

– 2024: Allocation of an initial amount of 960 000 shares

of which:

(i) an estimated number of 800 000 shares (stock awards) to

eligible employees, namely to an estimated 2 474 employees,

according to the applicable allocation criteria. These free

shares will be allocated if and when the eligible employees

remain in continuous employment with the UCB Group until

the 3 years anniversary of the grant of awards;

(ii) an estimated number of 160 000 shares to eligible

employees for the Performance Share Plan 2022, namely to

about 141 individuals, according to the applicable allocation

criteria. These free shares will be delivered if and when the

eligible employees remain in continuous employment with

the UCB Group until the 3 years anniversary of the grant and

the number of shares actually allocated will vary from 0% to

150% of the number of shares initially granted depending on

the level of achievement of the performance conditions set

by the Board of UCB SA/NV prior to the moment of the grant;

The estimated figures under (i) and (ii) do not take into account

employees hired or promoted to eligible levels between 1

January 2022 and 1 April 2022. Depending on the extent to with

performance criteria are met, these can vest between 0 and

150% of the granted PSP.

o It was acknowledged that the financial impact for the

Company of the granting of options is linked to the difference

between the acquisition cost of own shares by the Company

(or the share price at vesting date for cash settled plans) on

the one hand and the strike price of the options paid to the

Company by the beneficiary upon exercise of the options

on the other hand. For the stock awards and the PSP, the

financial impact corresponds to the value of the UCB shares

at the time of acquisition by the Company in view of delivery,

or at the time of vesting for cash settled plans.

o The Board further decided to delegate all powers to the

Head of Talent & Company Reputation, acting alone and

with faculty of sub-delegation, to do whatever is necessary,

required or useful to execute, roll-out and implement the

above decisions, including the finalization of all required

documentation, the actual grant decision, the final terms and

conditions and modalities of the plans and incentives (Stock

options, Stock awards and performance share plans).

5.1.3 CEO compensation and LTI

Decision: Upon recommendation of the GNCC, the Board

unanimously approved the following compensation for the CEO

performance:

• CEO base salary as of March 1, 2022: € 1 238 614 (against

€ 1 179 633 as from March 1, 2020);

• CEO bonus pay-out 2022 (performance 2021): € 1 456 186;

• CEO LTI 2022:

• stock options: 27 891 (3 years and 9 months vesting);

• performance shares: 20 778 (3-years vesting).

(…)”.

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192

Reaching our financial ambitions

goes hand-in-hand with sustainability

as our business approach. In 2022,

we achieved another year of solid

business results for UCB.

Financials

PB 193

UCB | Integrated Annual Report 2022

1. Business performance review

1.1 Key highlights

Actual

Variance

€ million 2022 2021 Actual rates CER

Revenue

5 517 5 777 - 4% - 7%

Net sales

5 140 5 471 - 6% - 8%

Royalty income and fees

85 79 8% - 3%

Other revenue

292 227 28% 24%

Adjusted Gross Profit

4 239 4 489 - 6% -7%

Gross Profit

3 843 4 339 - 11% -13%

Marketing and selling expenses

- 1 489 - 1 346 11% 3%

Research and development expenses

- 1 670 - 1 629 3% 0%

General and administrative expenses

- 225 - 208 9% 6%

Other operating income/expenses (-)

216 162 33% 20%

Adjusted EBIT

675 1 318 - 49% - 44%

Impairment, restructuring and other income/expenses (-)

- 90 - 34 > 100% >100%

EBIT (operating profit)

585 1 284 - 54% - 52%

Net financial expenses

- 74 - 58 26% 26%

Profit before income taxes

511 1 226 - 58% - 53%

Income tax expenses

- 91 - 170 - 46% - 42%

Profit from continuing operations

420 1 056 - 60% - 55%

Profit/loss (-) from discontinued operations

- 2 3 >-100% >-100%

Profit

418 1 058 - 61% - 55%

Attributable to UCB shareholders

418 1 058 - 61% - 55%

Adjusted EBITDA

1 260 1 641 - 23% - 21%

Capital expenditure (including intangible assets)

371 493 - 25%

Net debt (-)

- 2 000 - 860 >100%

Operating cash flow from continuing operations

1 119 1 553 - 28%

Weighted average number of shares – non diluted (million)

190 189 1%

EPS (€ per weighted average number of shares – non diluted)

2.20 5.60 - 61% - 55%

Core EPS (€ per weighted average number of shares –

non diluted)

4.37 6.49 - 33% - 28%

1 Due to rounding, some financial data may not add up in the tables included in this management report

2 CER: constant exchange rates and excluding hedging

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

194 195

€ 5 140 million Net sales

€ 5 517 million

Revenue

€ 292 million Other revenue

€ 85 million Royalty income and fees

Adjusted

EBITDA

€ 1 260 million

Revenue

€ 5 517 million

Net Sales

€ 5 140 million

Profit

€ 418 million

• In 2022 Revenue reached € 5 517 million down

by - 4% (- 7% at constant exchange rates (CER)).

Net sales reached € 5 140 million, down by - 6%

(- 8% CER). Net sales before “designated hedges

reclassified to net sales” – reflecting UCB’s realized

cash flow hedging activities – were down by - 2%

(- 8% CER). UCB’s product portfolio showed continuous

solid growth and was extended by newly launched

BIMZELX

* and the addition of FINTEPLA

**. This

positive performance was more than offset by the effects

of the loss of exclusivity for VIMPAT

** in the U.S. and

Europe and for E KEPPRA

** in Japan. Royalty income

and fees were € 85 million, other revenue € 292 million.

• Adjusted EBITDA reached € 1 260 million (- 23%;

- 21%CER), driven by lower revenue due to the losses of

exclusivity and higher expenses due to the integration

of Zogenix, Inc., strong marketing and selling expenses –

due to ongoing and upcoming launches, slightly higher

research and development expenses – thanks to the

pipeline progress, and higher general & administrative

costs. The cost increase is partly offset by higher other

operating income. Strong cost discipline allowed to

absorb inflation costs.

• Profit reached € 418 million from € 1 058 million, down

by - 61% (- 55% CER).

• Core earnings per share reached € 4.37 after

€ 6.49 in 2021 based on an average of 190 million

shares outstanding.

194 195

UCB | Integrated Annual Report 2022

This Business Performance Review is based on the

consolidated financial statements for the UCB Group of

companies prepared in accordance with IFRS. The separate

statutory financial statements of UCB SA prepared in

accordance with Belgian Generally Accepted Accounting

Principles, together with the report of the Board of Directors

to the General Assembly of Shareholders, as well as the

auditors’ report, will be filed at the National Bank of Belgium

within the statutory periods, and be available on request or

on our website.

Scope change: As a result of the divestment of non-Biopharma

activities in the past, UCB reports the results from those

activities as a part of profit from discontinued operations.

Adjusted gross profit is the gross profit without the amortization

of intangible assets linked to sales.

Restructuring, impairment and other income / expenses (-):

Transactions and decisions of a one-time nature that affect

UCB’s results are shown separately (“restructuring, impairment

and other income/expenses” items).

Besides EBIT (earnings before interest and taxes or operating

profit), a line for “adjusted EBIT” (underlying operating

profit), reflecting the ongoing profitability of the company’s

biopharmaceutical activities, is included. The adjusted EBIT

is equal to the line “operating profit before impairment,

restructuring and other income and expenses” reported in the

consolidated financial statements.

Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation

and Amortization charges) is the operating profit adjusted for

amortization, depreciation, impairment charges, restructuring

expenses and other income and expenses.

Core EPS is the core profit, or the profit attributable to the UCB

shareholders, adjusted for the after-tax impact of restructuring,

impairment, other income/expense items, the financial one-

offs, the after-tax contribution from discontinued operations

and the after-tax amortization of intangibles linked to sales, per

non-dilutive weighted average number of shares.

196 197

1.2 Key events

Macroeconomic

UCB operates in and is impacted by global or regional

macroeconomic (see Note 2.4) and political environments

which include the COVID-19 pandemic and the war against

Ukraine as well as the potential implications from major

healthcare reforms. During 2022 – and expected to continue

into 2023 – potential energy and supply chain disruptions

needed to be taken into account as well as inflation,

especially leading to inflation indexation of salaries of the

Belgian workforce.

Already during the COVID-19 pandemic, UCB’s energy and

supply chain network proved to be robust and anticipatory.

UCB is working hard to ensure continued and consistent

supply to be able to serve the needs of people living with severe

immunological and neurological diseases. The inflation of

salaries and costs is impacting UCB like many other companies.

Strong cost discipline enabled UCB to mitigate these

effects in 2022.

Impact of COVID-19 pandemic

The global pandemic of COVID-19 has eased during the course

of 2022, and many aspects of life have gone back to pre-

pandemic times. However, new variants may return, and UCB

will remain vigilant to protect the health of its employees and

stakeholders worldwide, especially its patients.

The direct impact of the COVID-19 pandemic on UCB’s

financial position, performance and cash-flows has been

limited. (see Note 2.1) and no special or additional contingency

measures are planned to mitigate the expected future impact of

this pandemic.

UCB’s existing risk management processes are comprehensive

and therefore no material unaddressed risks or uncertainties

were identified compared to the ones mentioned in the Risk

Management section of this Integrated Annual Report.

War Against Ukraine

What is happening in Ukraine goes against everything UCB

believes in. UCB cherishes and demonstrates an unwavering

respect for human life and dignity and firmly stands behind the

international condemnation of the aggression and violence

since the beginning of the conflict. As Russia’s invasion of

Ukraine continues and intensifies, UCB's despairs about the

violence and the devastating consequences increase. At the

same time, UCB is reminded of past and current wars that

receive less coverage but also have devastating effects and also

go against UCB's values.

In these difficult times, UCB is guided by its purpose of creating

value for patients, now and into the future and its focus on

contributing to a more inclusive and sustainable world. That

is why UCB is driven to limit the impact of this war on its

employees, patients, and their respective communities. Please

read the full statement of UCB's stand on www.ucb.com/UCBs-

response-to-the-conflict-in-Ukraine. For the current impact on

the financial performance, financial position and cash-flows, we

refer to Note 2.2 of this Integrated Annual Report.

Important agreements / initiatives

In January 2022, UCB and Zogenix, Inc. announced that the

companies have entered into a definitive agreement under which

UCB would acquire Zogenix, Inc.

On March 07, 2022, UCB announced the successful completion

of the transaction to acquire Zogenix, Inc. for US$ 26.00 per

share plus a milestone-based contingent value right (CVR) for a

potential cash payment of US$ 2.00 per share (gross) upon EU

approval by December 31, 2023, of FINTEPLA

** as an orphan

medicine for treatment of Lennox-Gastaut syndrome (LGS).

The total transaction was valued at up to approximately US$ 1.9

billion/ € 1.7 billion (total transaction value fully diluted). The rare

epilepsies drug FINTEPLA

** (fenfluramine) complements UCB’s

existing treatment offerings and will bring value to patients and

their families suffering from Dravet syndrome, from seizures

associated with Lennox-Gastaut syndrome and potentially

CDKL5 (see pipeline progress below).

In March 2022, UCB announced it will build an innovative and

environmentally sustainable gene therapy process development

and clinical manufacturing facility on its high-tech campus in

Braine-l’Alleud, Wallonia, Belgium. The new facility, representing

an investment of more than € 200 million over the coming years,

is expected to be operational in 2024. Construction started in the

second quarter of 2022.

In December 2022, UCB announced a strategic collaboration

with Praxis Precision Medicines, Inc., a clinical-stage

biopharmaceutical company, based upon Praxis’ PRAX-020

program, for the discovery of small molecule therapeutics

as potential treatments of KCNT1-related epilepsies. This

collaboration underlines UCB's dedication and global leadership

in developing treatments for epilepsy, including rare and genetic

epilepsies, with an ambition to create solutions that move from

symptomatic relief to those that could address the root causes

of disease including genetics-driven approaches. Under the

terms of the collaboration, UCB retains an exclusive option to in-

license global development and commercialization rights to any

resulting KCNT1 small molecule development candidate.

In January 2023, UCB sold an established brands portfolio of five

prescription medicines, commercialized in Europe. The portfolio

is comprised of pharmaceutical products in a variety of non-core

therapeutic categories.

In February 2023, UCB announced FINTEPLA

** (fenfluramine)

oral solution has been approved in the European Union (EU)

for the treatment of seizures associated with Lennox-Gastaut

syndrome (LGS) as an add-on therapy to other anti-epileptic

medicines for patients two years of age and older. FINTEPLA

was added to UCB’s product portfolio via the acquisition of

Zogenix, Inc. (see above). In making such approval, the European

Commission also adopted the EMA Committee for Orphan

Medicinal Products (COMP) recommendation that the orphan

designation for fenfluramine be maintained. As per the merger

agreement, this approval milestone triggers the payment to

holders of the CVR (US$ 2.00 per Zogenix, Inc. share (gross))

which was agreed to at the time of the Zogenix, Inc. acquisition.

1 From January 1, 2021 up to the publication of date of this report

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

196 197

UCB | Integrated Annual Report 2022

Regulatory updates and pipeline progress

Regulatory updates

Regulatory Updates – bimekizumab

†

In January 2022, the Japanese Ministry of Health, Labor

and Welfare granted marketing authorization for BIMZELX

(bimekizumab) for the treatment of plaque psoriasis,

generalized pustular psoriasis and psoriatic erythroderma

in patients who are not sufficiently responding to

existing treatments.

In February 2022, Health Canada granted approval for

BIMZELX

* for the treatment of moderate to severe plaque

psoriasis in adults who are candidates for systemic therapy

or phototherapy.

In March 2022, the Australian Therapeutic Goods

Administration (TGA) granted approval for BIMZELX

* for the

treatment of moderate to severe plaque psoriasis in adults who

are candidates for systemic therapy or phototherapy.

In May 2022, the European Medicines Agency (EMA) and

the U.K.'s Medicines and Healthcare products Regulatory

Agency approved a label update for BIMZELX

* to include

data from the Phase 3b BE RADIANT study. The BE RADIANT

study compared the efficacy and safety of an IL-17A and IL-17F

inhibitor, bimekizumab, to an IL-17A inhibitor, secukinumab.

Full results of this study were previously published in The New

England Journal of Medicine.

In May 2022, UCB announced that the U.S. Food and Drug

Administration (FDA) issued a Complete Response Letter

(CRL) regarding the Biologics License Application (BLA) for

bimekizumab for the treatment of adults with moderate to

severe plaque psoriasis. The letter indicated that the FDA could

not approve the application in its current form and that certain

pre-approval inspection observations of UCB's manufacturing

site in Belgium must be resolved before approval of the

application. The CRL is not related to efficacy nor to safety

of bimekizumab. In November 2022, UCB announced that it

had resubmitted the BLA to the FDA for bimekizumab for the

treatment of adults with moderate to severe plaque psoriasis.

In December 2022, the FDA accepted the BLA resubmission

for review. The FDA validated the resubmission as ‘Class

2’ with a six-month review period. UCB expects the FDA

action in Q2 2023.

In September 2022, EMA accepted for regulatory review

the two marketing authorization applications (MAA) for

bimekizumab

†

for the treatment of adult patients with active

psoriatic arthritis (PsA), and adult patients with active axial

spondyloarthritis (axSpA).

Regulatory Updates – fenfluramine

In March 2022, UCB announced that FINTEPLA

(fenfluramine) oral solution was approved in the United States

by the U.S. FDA for the treatment of seizures associated

with Lennox-Gastaut syndrome (LGS) in patients two years

of age and older. Additionally, the U.S. FDA has granted

pediatric exclusivity for the product. It is already approved for

the treatment of seizures associated with Dravet syndrome

in patients two years of age and older in the U.S. and EU.

FINTEPLA

** for LGS is available in the U.S. through a restricted

distribution program, called the Risk Evaluation and Mitigation

Strategy (REMS) Program.

In May 2022, the National Institute for Health and Care

Excellence (NICE) issued a Final Appraisal Determination (FAD),

recommending FINTEPLA

** as an option for the treatment

of seizures associated with Dravet syndrome as an add-on

therapy to other anti-epileptic medicines for patients two years

of age and older in the U.K.

In September 2022, UCB, announced that FINTEPLA

(fenfluramine) oral solution was approved by the Japanese

Ministry of Health, Labour and Welfare (MHLW) for the

treatment of seizures associated with Dravet syndrome as an

add-on therapy to other anti-epileptic medicines for patients

2 years of age and older. Fenfluramine will be marketed

by Nippon Shinyaku Co., Ltd. based on the exclusive sales

agreement signed in 2019 between Zogenix, Inc., (acquired by

UCB in 2022) and Nippon Shinyaku Co., Ltd. UCB is now the

Marketing Authorization holder.

In December 2022, UCB announced that FINTEPLA

(fenfluramine) oral solution was recommended by the

Committee for Medicinal Products for Human Use (CHMP)

for marketing authorization in the European Union (EU) for

the treatment of seizures associated with Lennox-Gastaut

syndrome (LGS) as an add-on therapy to other anti-epileptic

medicines for patients 2 years of age and older.

In February 2023, UCB announced the European

marketing authorization for FINTEPLA

** (fenfluramine) in

LGS. Additionally, the European Commission also adopted

the EMA Committee for Orphan Medicinal Products

(COMP) recommendation that the orphan designation for

fenfluramine be maintained.

198 199

Regulatory Updates – zilucoplan

††

& rozanolixizumab

††

In June 2022, the EMA's Committee for Orphan Medicinal

Products (COMP) adopted a positive opinion on the European

orphan drug designation application for zilucoplan

††

myasthenia gravis.

In November 2022, UCB announced that the U.S. Food and

Drug Administration (FDA) accepted for review the New Drug

Application (NDA) for its investigational treatment, zilucoplan

††

seeking approval for the treatment of generalized myasthenia

gravis (gMG) in adult patients who are acetylcholine receptor

antibody positive (AChR-Ab+). Acceptance by the FDA

followed the EMA validation of Marketing Authorization

Application (MAA) for treatment of adult patients with AChR-

Ab+ gMG and who require treatment in addition to steroids or

non-steroidal immunosuppressants. UCB expects to receive

feedback from the agencies in Q4 2023.

In January 2023, UCB announced that the FDA accepted

the filing to review a BLA for the investigational treatment

rozanolixizumab

††

and that the FDA granted Priority Review.

Rozanolixizumab

††

is a subcutaneous (SC) monoclonal

antibody targeting the neonatal Fc receptor (FcRn) for the

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

†

bimekizumab is an investigational drug product that has not been approved for any use by any authority in the world for PsA, axSpA and HS.

††

This is an investigational drug product and its safety and efficacy has not yet been established. It has not been approved for any use by any authority in the world.

treatment of adults with generalized myasthenia gravis (gMG)

who are anti-acetylcholine receptor (AChR) or anti-muscle-

specific tyrosine kinase (MuSK) antibody positive. UCB expects

to receive feedback from the FDA in Q2 2023. In 2019, the U.S.

FDA granted orphan drug designation to rozanolixizumab

††

for

the treatment of gMG.

The FDA Priority Review designation follows the

December 2022 EMA validation of the MAA for

rozanolixizumab

††

for the treatment of adults with AChR or

MuSK antibody positive gMG who require treatment in addition

to steroids or non-steroidal immunosuppressants. Orphan

designation was granted by the European Commission

in April 2020 to rozanolixizumab

††

for the treatment of

myasthenia gravis. UCB expects to receive initial feedback for

Europe in Q1 2024.

198 199

UCB | Integrated Annual Report 2022

Phase 1 Phase 2 Phase 3 Filing

Topline results H1 2024

Topline results Q4 2024

rozanolixizumab

(FcRn inhibitor)

MOG-antibody disease

Stereotypical prolonged seizures

bepranemab (anti-tau antibody)

Alzheimer’s disease

UCB9741

Atopic dermatitis

UCB0599

(α-syn-misfolding inhibitor)

Parkinson’s disease

Topline results H1 2024

Topline results H2 2024

doxecitine/doxribtimine

(MT1621, nucleoside therapy)

TK2 deficiency disorder

Starting submissions in H1 2024

dapirolizumab pegol

(anti-CD40L antibody)

Systemic lupus erythematosus

Topline results H1 2024

Topline results H2 2024

Autoimmune encephalitis

Severe fibromyalgia syndrome

fenﬂuramine

(5-HT agonist)

CDKL5 deficiency disorder

Topline results Q4 2024

Phase 1b

UCB1381

Atopic dermatitis

Phase 1b

STACCATO

alprazolam

(benzodiazepine)

1 In partnership with Biogen

2 In partnership with Roche/Genentech

3 In partnership with Novartis

UCB clinical development pipeline

200 201

Clinical Development Pipeline Progress

The updated timelines for UCB’s clinical development program,

also reflecting regulatory updates and pipeline progress from

January 1, 2022 up to the publication date of this report, are

shown below. In 2022 and thanks to the pro-active measures

taken by UCB, the timelines for UCB’s clinical development

program have not experienced any material delays due to

COVID-19 nor other geopolitical challenges. UCB continues to

monitor macro-economic factors on all ongoing clinical trials

and will implement changes as necessary.

Bimekizumab

†

Hidradenitis Suppurativa – In December 2022, UCB

announced positive top-line results from two Phase 3 studies,

BE HEARD I and BE HEARD II, evaluating the efficacy and

safety of bimekizumab

†

in adults with moderate to severe

hidradenitis suppurativa (HS). HS is a chronic, recurring, painful,

and debilitating inflammatory skin disease. People with HS

experience flare-ups of the disease as well as severe pain,

which can have a major impact on quality of life. The two

Phase 3 studies met their primary and key secondary endpoints

with statistical significance and consistent clinical relevance.

The positive results from these two studies will form the

basis of global regulatory license application submissions for

bimekizumab

†

in hidradenitis suppurativa starting in Q3 2023.

Rozanolixizumab

††

Immune thrombocytopenia (ITP) – In the first six months

of 2022, UCB decided to de-prioritize the development of

rozanolixizumab

††

in immune thrombocytopenia (ITP). Since

UCB took the decision to progress the rozanolixizumab

††

ITP development program to Phase 3 in 2019, the treatment

landscape for people living with ITP has significantly evolved.

New targeted therapies, offering multiple opportunities to

transform the care and management of ITP, are now available

or in late-stage development. This evolution looks set to

address many of the significant unmet needs faced by the ITP

patient community. Taking these factors into account, UCB

will not progress with the rozanolixizumab

††

ITP development

program. This allows UCB to reallocate resources to areas with

higher unmet medical needs.

Severe Fibromyalgia Syndrome – UCB initiated a Phase 2a

proof-of-concept study to evaluate the efficacy and safety of

rozanolixizumab

††

to treat adult study participants with severe

fibromyalgia syndrome. First topline results are expected in H2

2024. Fibromyalgia (FM) is a common, severe and debilitating

disorder of unknown etiology characterized by widespread

musculoskeletal pain, fatigue, sleep disturbances, and mood

disorders. Recent insights indicate that pathogenic IgG

antibodies drive severe FM.

UCB9741 and UCB1381

Atopic Dermatitis – UCB initiated Phase 1b studies in atopic

dermatitis addressing two different targeted immune pathways

with UCB9741 and UCB1381. These early studies evaluate

the safety, pharmacokinetics and efficacy in people with

moderate-to-severe atopic dermatitis. Atopic dermatitis is a

chronic condition that causes dry, itchy and inflamed skin and

can affect people at all ages.

fenfluramine

CDKL5 deficiency disorder (CDD) – Following the acquisition

of Zogenix, Inc., UCB decided to continue with the development

of the Phase 3 clinical trial program of fenfluramine in CDKL5

deficiency disorder, or CDD. The Phase 3 program evaluates

efficacy and safety as an adjunctive therapy in patients 1 to 35

years of age with CDD and uncontrolled seizures. First topline

results are expected in H2 2024. CDD is a rare developmental

epileptic encephalopathy caused by mutations in the CDKL5 gene.

Although rare, CDD is one of the most common forms of genetic

epilepsy. In June 2022, the FDA granted orphan drug designation

to FINTEPLA

** to treat CDD.

Doxecitine and Doxribtimine (MT1621; nucleoside therapy)

Thymidine Kinase 2 deficiency – Following the acquisition of

Zogenix, Inc., UCB sees a high unmet medical need to continue

with the development of doxecitine and doxribtimine (doxTM

††

a dual substrate pyrimidine nucleoside enhancement therapy

being developed for the treatment of patients with thymidine

kinase 2 deficiency (TK2d). TK2d is an ultra-rare debilitating and

life-threatening (often fatal) genetic mitochondrial disorder and

causes progressive and severe muscle weakness. The clinical

development program is complete. Following in-depth evaluation

and alignment meetings with key regulatory agencies on the

filing strategy for doxTM

††

, regulatory submissions are now

planned for H1 2024.

BRIVIACT

** (brivaracetam)

Epilepsy – In October 2022, UCB announced positive top-line

results from the latest Phase 3 study of brivaracetam. The study

was designed to evaluate the efficacy and safety of adjunctive

brivaracetam in participants from Asia (≥16 to 80 years of age)

with partial seizures with or without secondary generalization. The

study met the primary and all secondary endpoints. UCB plans

regulatory submissions in Japan in Q3 2023.

Bepranemab (UCB0107)

Alzheimer's disease – Bepranemab is a recombinant, humanized,

full-length immunoglobulin G4 monoclonal anti-tau antibody

currently under clinical investigation for the treatment of

patients with Alzheimer’s disease (AD) in partnership with Roche/

Genentech. The efficacy, safety and tolerability of bepranemab

in patients with early AD are investigated in a Phase 2 study,

which started in Q2 2021. Recruitment for this study was

completed ahead of time and topline results are now expected

earlier, in Q4 2024.

UCB0599

Parkinson's disease – UCB0599 is an orally bioavailable and brain-

barrier-penetrant small molecule that prevents the pathological

misfolding and accumulation of alpha-synuclein, a protein which

plays a key role in Parkinson’s disease (PD) pathology. By inhibiting

the disease-causing biology of alpha-synuclein misfolding, it

is believed that the progression of PD can be slowed or halted.

Under a global co-development and co-commercialization

agreement with Novartis, UCB is conducting a phase 2a study with

UCB0599 for study participants with early-stage PD. In 2022, an

additional dosing arm was introduced into the study. Recruitment

is complete and topline results are now expected in Q4 2024.

All other clinical development programs are continuing as planned.

** Prescribing information varies depending on regulatory approval in each country.

†

bimekizumab is an investigational drug product that has not been approved for any use by any authority in the world for PsA, axSpA and HS.

††

This is an investigational drug product and its safety and efficacy has not yet been established. It has not been approved for any use by any authority in the world.

200 201

UCB | Integrated Annual Report 2022

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

†

bimekizumab is an investigational drug product that has not been approved for any use by any authority in the world for PsA, axSpA and HS.

1.3 Net sales by product

Actual Variance

€ million 2022 2021 Actual rates CER

CIMZIA

2 085 1 841 13% 5%

VIMPAT

1 124 1 549 -27% -33%

KEPPRA

** (including KEPPRA

** XR / E KEPPRA

**)

729 970 -25% -26%

BRIVIACT

485 355 37% 24%

NEUPRO

305 307 0% - 4%

FINTEPLA

116 0 N/A N/A

NAYZILAM

78 57 36% 21%

BIMZELX

35 4 >100% >100%

EVENITY

25 10 >100% >100%

Established brands

325 321 1% 2%

Net sales before hedging

5 307 5 414 -2% - 8%

Designated hedges reclassified to net sales

- 167 57 >-100%

Total net sales

5 140 5 471 - 6% - 8%

Total net sales in 2022 reached € 5 140 million, - 6% lower than

last year or - 8% at constant exchange rates. Net sales before

“designated hedges reclassified to net sales” were down by

- 2% (- 8%CER). The designated hedges reflect UCB’s realized

transactional hedging activities.

This net sales performance in 2022 was driven by the

continued growth of UCB’s product portfolio – namely

CIMZIA

**, BRIVIACT

**, NAYZILAM

** and EVENITY

as well as newly launched BIMZELX

* – and the addition

of FINTEPLA

**. This performance was slightly over-

compensated by the effects of the loss of exclusivity for

VIMPAT

** in the U.S. and Europe and E KEPPRA

** in Japan.

Core products

CIMZIA

** (certolizumab pegol), reached 180 000 people

(+6%) living with inflammatory TNF mediated diseases

and increased net sales to € 2 085 million (+13%; +5%

CER). CIMZIA

** is showing a stronger growth than the

anti-TNF market – based on differentiation and driven by

continued double-digit growth in the U.S. and Japan. Hence,

CIMZIA

** has reached UCB’s projected peak sales target of

€ 2 000 million ahead of time.

VIMPAT

** (lacosamide) was accessed by over 600 000

(-25%) people living with epilepsy and is experiencing generic

competition since end of March 2022 in the U.S. and since

September in Europe due to loss of exclusivity in these two

regions. In Japan and international markets, the net sales

show continued solid growth. All in all, net sales went down to

€ 1 124 million (-27%; -33% CER).

KEPPRA

** (levetiracetam), reached more than 1.8 million

people living with epilepsy and reported lower net sales of

€ 729 million (-25%; -26% CER). The generic erosion due to

loss of exclusivity in Japan started early January 2022 and

was stronger than expected due to multiple generics and

governmental support for generics. Also in the U.S. and Europe

the performance is reflecting generic competition, in these

regions loss of exclusivity occured more than 10 years ago.

BRIVIACT

** (brivaracetam) was used by 190 000 people

(+36%) living with epilepsy, increased net sales to € 485 million,

a plus of 37% (+24% CER). This is driven by continued,

significant growth in all regions BRIVIACT

** is available to

patients. BRIVIACT

** has a different mode of action from

VIMPAT

** and differentiates from KEPPRA

**.

NEUPRO

** (rotigotine), the patch for Parkinson’s disease

and restless legs syndrome, used by over 340 000 people

(-12%), recorded stable net sales of € 305 million (0%; - 4%

CER), in a competitive market environment. A slight decline in

net sales in Europe was compensated by a slight increase in

international markets.

FINTEPLA

** (fenfluramine), an addition to UCB’s portfolio

due the acquisition of Zogenix, Inc. in March 2022, reached

over 1 000 patients and their families living with seizures

associated with rare epileptic syndromes (Dravet Syndrome

and Lennox-Gastaut Syndrome). Net sales (March – December)

were € 116 million. The integration of Zogenix, Inc. was

successfully completed end of 2022.

202 203

VIMPAT

** € 1124 million

FINTEPLA

** € 116 million

KEPPRA

** € 729 million

BRIVIACT

** € 485 million

NAYZILAM

** € 78 million

CIMZIA

** € 2 085 million

BIMZELX

* € 35 million

NEUPRO

** € 305 million

EVENITY

** € 25 million

Established brands € 325 million

€ 5 307 million

net sales

excluding hedging

NAYZILAM

** (midazolam) Nasal Spray

CIV

, the nasal rescue

treatment for epilepsy seizure clusters in the U.S. reached

over 90 000 patients (+80%) and net sales of € 78 million after

€ 57 million, a plus by 36% (+21% CER).

BIMZELX

* (bimekizumab) is available for people living with

psoriasis in Europe, the U.K., Japan, Australia, Canada and

further countries. In 2022, more than 4 000 people living

with psoriasis had access to the product. Reported net sales

were € 35 million after € 4 million in 2021. For the U.S., the

regulatory review is ongoing with an expected decision by

the U.S. authority in Q2 2023. Following a so called “complete

response letter” received in May 2022 and addressing certain

pre-approval site inspection observations, UCB re-submitted

the dossier to the U.S. FDA in November which was validated

and classified as class 2 (6 months review) by the U.S. FDA

in December 2022.

EVENITY

** (romosozumab) since its global launch reached

world-wide more than 400 000 (2021: 200 000) women

living with severe postmenopausal osteoporosis at high risk

of fracture. It had its first European launch in March 2020

and reported for this region net sales of € 25 million (after

€ 10 million), impacted by the pandemic which impeded

outreach to new patient populations. EVENITY

** is being

launched successfully globally by Amgen, Astellas and

UCB since 2019, with net sales outside Europe reported

by the partners.

Product € million % in total

Immunology

CIMZIA

2 085 39%

BIMZELX

35 1%

Epilepsy

VIMPAT

1 124 21%

KEPPRA

729 14%

BRIVIACT

485 9%

NAYZILAM

78 1%

FINTEPLA

116 2%

NEUPRO

305 6%

EVENITY

25 0%

Established Brands

325 6%

Net sales excluding hedging  

Established brands

The performance of the net sales of established brands were

slightly positive with +1% reaching € 325 million (+2% CER),

reflecting the maturity of the portfolio. The portfolio includes

UCB’s allergy products ZYRTEC

** (cetirizine, including

ZYRTEC

**-D / CIRRUS

**) and XYZAL

** (levocetirizine),

both reflecting a stronger allergy season.

Designated hedges reclassified to net sales were

€ - 167 million after € +57 million in 2021. As part of its currency

hedging strategy, UCB hedged the forecasted 2022 foreign

currency cash flows during 2021. The hedge result results

primarily from the appreciation of U.S. Dollar (next to the

Japanese Yen, the British Pound and the Swiss Franc) and has

been reclassified into net sales.

202 203

UCB | Integrated Annual Report 2022

1.4 Net sales by geographical area

Actual Variance actual rates Variance CER

€ million

2022 2021 € million % € million %

Net sales – U.S.

2 902 2 888 14 0% - 307 -11%

CIMZIA

1 381 1 183 198 17% 45 4%

VIMPAT

706 1 130 - 424 -38% - 502 -44%

BRIVIACT

380 267 114 43% 71 27%

KEPPRA

156 156 0 0% - 17 -11%

FINTEPLA

107 0 107 N/A 95 N/A

NEUPRO

94 95 0 0% - 11 -11%

NAYZILAM

78 57 21 36% 12 21%

Net sales – Europe

1 414 1 396 18 1% 14 1%

CIMZIA

416 420 - 3 -1% - 5 -1%

VIMPAT

272 294 - 22 - 8% - 23 - 8%

KEPPRA

206 218 - 12 - 5% - 13 - 6%

NEUPRO

163 167 - 4 - 2% - 4 - 3%

BRIVIACT

88 77 10 13% 10 13%

BIMZELX

29 4 24 >100% 24 >100%

EVENITY

25 10 15 >100% 15 >100%

FINTEPLA

8 0 8 N/A 8 N/A

Established brands

207 206 2 1% 2 1%

Net sales – Japan

324 562 - 237 -42% - 218 -39%

KEPPRA

149 404 - 254 -63% - 245 -61%

VIMPAT

68 62 6 10% 11 17%

CIMZIA

51 44 7 15% 10 22%

NEUPRO

27 26 0 1% 2 6%

BIMZELX

4 0 4 N/A 4 N/A

FINTEPLA

1 0 1 N/A 1 N/A

Established brands

24 25 - 1 - 5% 0 2%

Net sales – International markets

667 568 98 17% 81 14%

CIMZIA

237 193 44 23% 34 18%

KEPPRA

217 193 24 13% 22 11%

VIMPAT

77 62 15 25% 10 17%

NEUPRO

22 19 3 14% 1 6%

BRIVIACT

17 11 6 55% 5 43%

BIMZELX

2 0 2 N/A 2 N/A

Established brands

94 90 4 5% 7 8%

Net sales before hedging

5 307 5 414 - 107 -2% - 430 - 8%

Designated hedges reclassified to net sales

- 167 57 - 224 >-100%

Total net sales

5 140 5 471 - 332 - 6% - 430 - 8%

U.S. net sales reached € 2 902 million (+0%; -11% CER). The

continued solid growth of CIMZIA

**, BRIVIACT

** and

NAYZILAM

** as well as the new addition of FINTEPLA

** is

being compensated by VIMPAT

** declining due to generic

competition since end of March 2022.

Net sales in Europe reached € 1 414 million (+1%; +1%

CER) – thanks to BRIVIACT

**, EVENITY

**, BIMZELX

* and

FINTEPLA

** more than compensating the effect of generic

competition to VIMPAT

** since September 2022 as well as the

ongoing generic erosion to KEPPRA

**.

204 205

Europe € 1 414

million

International markets € 667 million

Japan € 324 million

U.S. € 2 902 million

€ 5 307 million

net sales

excluding hedging

Net sales in Japan were € 324 million after € 562 million in

2021 (-42%; -39% CER). The decline is due to the generic

erosion since early January to E KEPPRA

** after loss of

exclusivity. This decline was stronger than expected due to

multiple generics in the market and governmental support

for generics. The other products of UCB’s portfolio in Japan

are showing continued, solid growth. The net sales shown

for E KEPPRA

** and BIMZELX

* reflect the in-market sales

booked by UCB. For the other products, net sales reported

are mainly intercompany sales with the respective partner in

Japan. In 2021, net sales in Japan have been reported as part of

“international markets” – the net sales of international markets

have been adjusted accordingly.

International markets net sales amounted to € 667 million

reflecting a strong growth contribution from all products

(+17%; +14% CER). Net sales in the largest market in this region,

China, were € 159 million (+14%; +6% CER).

Designated hedges reclassified to net sales were

€ - 167 million (€ +57 million in 2021) reflecting UCB’s realized

transactional hedging activities. These are mainly related

to the U.S. Dollar, the Japanese Yen, the British Pound and

the Swiss Franc.

€ million % in total

Europe

1 414 27%

Japan

324 6%

International markets

667 13%

U.S.

2 902 55%

Net sales excluding hedging

5 307

1.5 Royalty income and fees

Actual Variance

€ million 2022 2021 Actual rates CER

Biotechnology IP

56 46 21% 7%

Other

29 33 - 14% - 20%

Royalty income and fees

85 79 8% - 3%

In 2022, royalty income and fees increased to € 85 million

after € 79 million.

The biotechnology IP income benefitted from royalties on

marketed products using UCB’s antibody intellectual property.

Other royalties include the allergy product and the franchise

royalties paid by Pfizer for the overactive bladder treatment

TOVIAZ

(fesoterodine), reflecting generic competition.

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

204 205

UCB | Integrated Annual Report 2022

1.6 Other revenue

Actual Variance

€ million 2022 2021 Actual rates CER

Contract manufacturing sales

103 128 -20% -22%

Other

189 99 91% 83%

Other revenue

292 227 28% 24%

Other revenue went up to € 292 million or by +28%.

Contract manufacturing sales decreased to € 103 million from

€ 128 million, due to continued lower demand and end of a

contract from an UCB partner.

“Other” revenue reached € 189 million (after € 99 million) and

includes partnership activities in Japan (for FINTEPLA

** as well

as VIMPAT

** and CIMZIA

**), milestones and other payments

from R&D partners and licensing partners, including Biogen

for dapirolizumab pegol in lupus (SLE), Roche for bepranemab

in Alzheimer’s disease and Novartis on the development of

UCB0599 in Parkinson’s disease. It also includes a one-time

amount of € 70 million from the sale of IP rights (olokizumab).

1.7 Gross profit

Actual Variance

€ million 2022 2021 Actual rates CER

Revenue

5 517 5 777 - 4% - 7%

Net sales

5 140 5 471 - 6% - 8%

Royalty income and fees

85 79 8% - 3%

Other revenue

292 227 28% 24%

Cost of sales

-1 674 - 1 438 16% 11%

Cost of sales products and services

-1 067 - 962 11% 7%

Royalty expenses

- 212 - 327 - 35% - 40%

Adjusted Gross Profit

4 239 4 489 - 6% -7%

Amortization of intangible assets linked to sales

- 396 - 149 >100% >100%

Gross Profit

3 843 4 339 - 11% -13%

In 2022, the gross profit before “amortization of intangible

assets linked to sales” was € 4 239 million (- 6%; - 7% CER) and

in-line with the net sales performance. The adjusted gross

margin is 77% after 78% in 2021.

Gross profit after “amortization of intangible assets

linked to sales” reached € 3 843 million – a gross margin

of 70% after 75% in 2021 and reflecting the addition of

FINTEPLA

** amortization.

Cost of sales has three components: the cost of sales for

products and services, royalty expenses, and the amortization

of intangible assets linked to sales:

• The cost of sales for products and services increased

to € 1 067 million – mainly due to the write-off of certain

bimekizumab inventory after not being able to launch in the U.S.

market in 2022.

• Royalty expenses went down to € 212 million after € 327 million

due to patent expirations.

• Amortization of intangible assets linked to sales: Under IFRS

3, UCB has reflected on its statement of financial position a

significant amount of intangible assets relating to the 2022

Zogenix, Inc. acquisition and the previously acquired Celltech

and Schwarz Pharma (in-process research and development,

manufacturing know-how, royalty streams, trade names, etc.).

The amortization expenses of the intangible assets for which

products have already been launched increased to € 396 million

(after € 149 million), as FINTEPLA

** was added while VIMPAT

amortization ended after Loss of Exclusivity in U.S. and Europe.

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

†

bimekizumab is an investigational drug product that has not been approved for any use by any authority in the world for PsA, axSpA and HS.

††

This is an investigational drug product and its safety and efficacy has not yet been established. It has not been approved for any use by any authority in the world.

206 207

1.8 Adjusted EBIT and Adjusted EBITDA

Actual Variance

€ million

2022 2021 Actual rates CER

Revenue

5 517 5 777 - 4% - 7%

Net sales

5 140 5 471 - 6% - 8%

Royalty income and fees

85 79 8% - 3%

Other revenue

292 227 28% 24%

Adjusted Gross Profit

4 239 4 489 - 6% - 7%

Gross Profit

3 843 4 339 - 11% - 13%

Marketing and selling expenses

-1 489 -1 346 11% 3%

Research and development expenses

-1 670 -1 629 3% 0%

General and administrative expenses

- 225 - 208 9% 6%

Other operating income/expenses (-)

216 162 33% 20%

Total operating expenses

-3 168 -3 021 5% 1%

Adjusted EBIT

675 1 318 - 49% - 44%

Add: Amortization of intangible assets

439 187 >100% >100%

Add: Depreciation charges

146 135 9% 5%

Adjusted EBITDA

1 260 1 641 - 23% - 21%

Operating expenses, encompassing marketing and selling

expenses, research and development expenses, general

and administrative expenses and other operating income/

expenses, increased to € 3 168 million reflecting higher

expenses due to the addition and integration of Zogenix, Inc.

Strong cost discipline, and the transversal program “Focus-

for-Growth” driving sustainable efficiency and allowing

value-based resource allocation, allowed to more than absorb

inflation costs. Total operating expenses in relation to revenue

(operating expense ratio) increased to 57% following 52% in

2021, consisting of:

• marketing and selling expenses of € 1 489 million, 11% higher

or plus 3% CER, focused reallocation and cost discipline

allowed to invest behind the launches and pre-launch activities:

Global FINTEPLA

** launch activities, global BIMZELX

* launch

activities as well as ongoing preparations for the launch in the

U.S. Global pre-launch activities for rozanolixizumab

††

and

zilucoplan

††

for people living with generalized myasthenia gravis

(gMG) and EVENITY

** ongoing launches throughout Europe.

• research and development expenses of € 1 670 million (+3%;

0%) reflect the continued investments in UCB’s progressing

pipeline which resulted in several ongoing regulatory reviews:

bimekizumab

†

(several indications), rozanolixizumab

††

zilucoplan

††

and fenfluramine. In 2022, six phase 3 programs

and three phase 2 programs were ongoing, as well as earlier

stage clinical development. Three new programs were added

to the pipeline. The strategic decision to terminate the clinical

development in ITP led to € 46 million costs in 2022. The R&D

ratio reached 30% in 2022 following 28% in 2021.

• general and administrative expenses of € 225 million (+9%;

+6% CER), driven by the integration of Zogenix, Inc.

• other operating income increased to € 216 million, following

€ 162 million in 2021 – driven by an income of € 240 million

reflecting the net contribution from Amgen in connection

with the commercialization of EVENITY

** (after an income of

€ 151 million in 2021). This was partly compensated by write-

offs on receivables.

Due to lower revenue driven by generic erosion and

high operating expenses driven by launches and launch

preparations as well as significantly higher depreciation and

amortization charges due to the addition of FINTEPLA

in March 2022, adjusted EBIT went down by - 49% to

€ 675 million, compared to 1 318 million in 2021.

• total amortization of intangible assets (product related and

other) amounted to € 439 million after € 187 million due to the

addition of FINTEPLA

**.

• depreciation charges reached € 146 million.

Adjusted EBITDA (Earnings before Interest, Taxes, Depreciation

and Amortization charges) reached € 1 260 million after

€ 1 641 million (- 23%; - 21% CER), driven by decreased revenue

and high operating expenses, reflecting the investments into

the future growth of UCB, namely into product launches and

ongoing clinical development. The adjusted EBITDA ratio for

2022 (in % of revenue) reached 22.8%, vs 28.4% in 2021.

206 207

UCB | Integrated Annual Report 2022

1.9 Profit

€ million

2022 2021 Actual rates CER

Adjusted EBIT

675 1 318 -49% -44%

Impairment charges

0 - 6 -100% -100%

Restructuring expenses

- 42 - 21 99% 90%

Gain/loss (-) on disposals

3 - 1 >-100% >-100%

Other income/expenses (-)

- 51 - 6 >100% >100%

Total impairment, restructuring and other income/expenses (-)

- 90 - 34 >100% >100%

EBIT (operating profit)

585 1 284 -54% -49%

Net financial expenses (-)

- 74 - 58 26% 26%

Profit before income taxes

511 1 226 -58% -53%

Income tax expenses

- 91 - 170 -46% -42%

Profit from continuing operations

420 1 056 -60% -55%

Profit/loss (-) from discontinued operations

- 2 3 >-100% >-100%

Profit

418 1 058 -61% -55%

Attributable to UCB shareholders

418 1 058 -61% -58%

Profit attributable to UCB shareholders

418 1 058 -61% -55%

Total impairment, restructuring and other

expenses (-) increased to € 90 million expenses (after an

expense of € 34 million in 2021). This was mainly driven by

fees and restructuring expenses related to the acquisition of

Zogenix, Inc. in March 2022.

Net financial expenses went up to € 74 million from

€ 58 million in 2021, based on higher interest rates as well as

higher interest cost due to higher net debt in connection with

the acquisition of Zogenix, Inc.

Income tax expenses were € 91 million compared to

€ 170 million in 2021, with an average effective tax rate of

17.8% compared to 13.9% in 2021, related to lower earnings

and earnings mix.

Profit / Loss from discontinued operations is € 2 million loss

after € 3 million profit last year.

The profit of the Group amounted to € 418 million after

€ 1 058 million.

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

208 209

1.10 Core EPS

Actual Variance

€ million 2022 2021 Actual rates CER

Profit

418 1 058 -61% - 55%

Attributable to UCB shareholders

418 1 058 - 61% - 58%

Profit attributable to UCB shareholders

418 1 058 - 61% - 55%

Total impairment, restructuring and other income (-) /expenses

90 34 >100% >100%

Income tax on impairment, restructuring and other

expenses (-)/ credit

- 14 - 4 >100% >100%

Profit (-)/loss from discontinued operations

2 - 3 > -100% > -100%

Amortization of intangibles linked to sales

396 149 >100% >100%

Income tax on amortization of intangibles linked to sales

- 63 - 9 >100% >100%

Core profit attributable to UCB shareholders

829 1 226 -32% - 28%

Weighted average number of shares (million)

190 189 0%

Core EPS attributable to UCB shareholders (€)

4.37 6.49 - 33% - 28%

The profit attributable to UCB shareholders, adjusted for the

after-tax impact of to-be adjusted items, the financial one-offs,

the after-tax contribution from discontinued operations and

the net amortization of intangibles linked to sales, amounted

to core profit attributable to the UCB shareholders of

€ 829 million (-32%; - 28% CER), leading to core earnings per

share (EPS) of € 4.37 compared to € 6.49 in 2021, per non-

dilutive weighted average number of shares of 190 million.

1.11 Capital expenditure

In 2022, the tangible capital expenditure resulting from the

UCB biopharmaceutical activities amounted to € 252 million

(2021: € 282 million) and are mainly related to the construction

of the Biotech manufacturing plant and gene therapy facility in

Belgium, building facilities and IT hardware.

Acquisition of intangible assets reached € 119 million in 2022

(2021: € 211 million) and is related to software, capitalized

eligible development costs and milestones, and the

capitalization of external development expenses for post

approval studies.

1.12 Statement of financial position

The intangible assets increased by € 1 657 million from

€ 3 159 million at December 31, 2021 to € 4 816 million at

December 31, 2022. The increase includes the acquisition of

Zogenix, Inc. for € 1 803 million, other additions (related to in-

licensing deals, software and capitalized eligible development

costs) for € 90 million. The amortization of the year is at

€ 442 million and is partially offset with the positive impact on

the translation of foreign currencies.

Goodwill at € 5 340 million, up € 167 million. The increase is

related to the acquisition of Zogenix, Inc. € 19 million and a

stronger U.S. Dollar compared to December 2021.

Other non-current assets at € 2 408 million or € 240 million

higher compared to last year, driven by additions for property,

plant and equipment (including acquisition Zogenix, Inc.) of

€ 324 million offset with ongoing depreciation, and increase

of deferred tax assets related to timing differences and

R&D tax credits.

The current assets decreased from € 3 710 million as of

December 31, 2021 to € 3 304 million as of December 31, 2022

include slightly higher inventory, lower outstanding trade

receivables, and a decrease in cash and equivalents after the

acquisition of Zogenix, Inc. in 2022.

UCB’s shareholders’ equity, at € 9 064 million, showed an

increase of € 678 million between December 31, 2021 and

December 31, 2022. The main changes stem from the net

profit (€ 418 million), the US$ and GBP currency translation

(€ 272 million), remeasurement of the defined benefit

obligation (€ 132 million), the cash-flow hedges (€ 87 million),

offset with the dividend payments (€ - 247 million) and the

acquisition of own shares (€ - 58 million).

The non-current liabilities amounted to € 3 692 million, an

increase of € 692 million, and include the US$ 800 million

bullet term loan facility agreement that the Group has

entered into in 2022 for the Zogenix, Inc. acquisition and an

increase related to deferred tax liabilities recorded on the

acquired Zogenix, Inc. assets. This is offset with a decrease of

outstanding employee benefits after the increase of discount

208 209

UCB | Integrated Annual Report 2022

rates, and the € 176 million bond maturing in 2023 accounted

for as a current liability.

The current liabilities amounted to € 3 112 million, up

€ 288 million, and include the € 176 million bond maturing in

2023, the contingent value right for a cash payment of

US$ 2.00 upon EU approval of FINTELA as an orphan medicine

for the treatment of Lennox-Gaustaut syndrome stemming

from the acquisition of Zogenix, Inc. (see Note 8), offset with

lower outstanding trade and other payables.

Net financial debt at € 2 000 million as per end

December 2022, an increase of € 1 140 million compared to

€ 860 million as of end December 2021. The increase is related

to the acquisition of Zogenix, Inc. in March 2022, the 2021

dividend, offset with the underlying net profitability. The net

debt to adjusted EBITDA ratio for 2022 is 1.6.

1.13 Cash flow statement

The evolution of cash flow generated by bio-pharmaceutical

activities is affected by the following:

• Cash flow from operating activities amounted to

€ 1 119 million, all related to continuing operations, compared

to € 1 553 million in 2021. The cash inflow stems from

underlying net profitability, lower outstanding receivables, offset

with lower payables and working capital stemming from the

Zogenix, Inc. acquisition.

• Cash flow from investing activities showed an outflow of

€ 1 580 million from continuing operations, compared to

€ 487 million in 2021 and includes the acquisition of Zogenix,

Inc. (€ 1 212 million, net of cash), tangible (€ 252 million) and

intangible (€ 119 million) capital expenditures.

• Cash flow from financing activities had an inflow of € 70 million,

which includes mainly the proceeds of the US$ 800 million

bullet term loan facility offset by the dividend paid to UCB

shareholders (€ - 247 million) and the repayment of the

convertible senior notes issued by Zogenix, Inc. (€ - 262 million).

1.14 Financial Guidance 2023

The year 2023 will be marked by ongoing launches and

expected several upcoming launches in the U.S. and Europe

(subject to regulatory approvals). At the same time UCB

is impacted by the full annualized and ongoing generic

erosion to VIMPAT

**.

For 2023, UCB is aiming for revenues in the range of € 5.15 –

€ 5.35 billion taking into account the full annualized negative

impacts from the loss of exclusivity for VIMPAT

** in the

U.S. and Europe, launch contributions like the expected

mid-year U.S. launch of bimekizumab for people living with

psoriasis and continued solid contributions from the existing

product portfolio.

UCB will continue to invest in preparing upcoming launches

to offer potential new solutions for people living with severe

diseases and remains committed to invest into research and

development advancing its late-stage development pipeline.

At the same time, UCB will continue to be cost disciplined, to

divest non-core assets and to limit the impact of significant

inflation. The integration of the Zogenix, Inc. acquisition

will become earnings accretive during 2023. Underlying

profitability, adjusted EBITDA, is expected in the range of 22.5%

– 23.5% of revenue. Core earnings per share are therefore

expected in the range of € 3.40 – 3.80 per share – based on an

average of 190 million shares outstanding.

The figures for the financial guidance 2023 as mentioned

above are calculated on the same basis as the actual

figures for 2022.

Based on UCB’s current assessment of the COVID-19

pandemic, UCB remains confident in the fundamental

underlying demand for its products and its prospects for long-

term growth. UCB will continue to closely follow the evolving

COVID-19 pandemic diligently to assess potential near- and

mid-term challenges.

** Prescribing information varies depending on regulatory approval in each country.

210 PB

2.1 Consolidated income statement

For the year ended December 31

€ million Note 2022 2021

Continuing operations

Net Sales 

5 140 5 471

Royalty income and fees

85 79

Other revenue 

292 227

Revenue

5 517 5 777

Cost of sales

- 1 674 - 1 438

Gross profit

3 843 4 339

Marketing and selling expenses

- 1 489 - 1 346

Research and development expenses

- 1 670 - 1 629

General and administrative expenses

- 225 - 208

Other operating income/expenses (-) 

216 162

Operating profit before impairment, restructuring and other income and expenses

675 1 318

Impairment of non-financial assets 

0 - 6

Restructuring expenses 

- 42 - 21

Other income/expenses (-) 

- 48 - 7

Operating profit

585 1 284

Financial income 

38 80

Financial expenses 

- 112 - 138

Profit before income taxes

511 1 226

Income tax expense 

- 91 - 170

Profit from continuing operations

420 1 056

Discontinued operations

Profit/loss (-) from discontinued operations 

- 2 3

Profit

Attributable to:

Equity holders of UCB SA

418 1 058

Non-controlling interests

0 0

Basic earnings per share (€)

from continuing operations 

2.21 5.59

from discontinued operations 

- 0.01 0.01

Total basic earnings per share

2.20 5.60

Diluted earnings per share (€)

from continuing operations 

2.15 5.44

from discontinued operations 

- 0.01 0.01

Total diluted earnings per share

2.14 5.45

2. Consolidated financial

statements

PB 211

418

1 058

UCB | Integrated Annual Report 2022

2.2 Consolidated statement of comprehensive income

For the year ended December 31

€ million Note 2022 2021

Profit for the period

418 1 058

Other comprehensive income

Items to be reclassified to profit or loss in subsequent periods:

- Net gain/loss (-) on financial assets at FVOCI

0 26

- Exchange differences on translation of foreign operations

272 280

- Effective portion of gains/losses (-) on cash flow hedges

104 - 140

- Income tax relating to the components of other comprehensive Income to be

reclassified to profit or loss in subsequent periods

- 13 33

Items not to be reclassified to profit or loss in subsequent periods:

- Remeasurement of defined benefit obligation 

145 97

- Income tax relating to the components of other comprehensive Income not

to be reclassified to profit or loss in subsequent periods

- 13 - 10

Other comprehensive income/loss (-) for the period, net of tax

495 286

Total comprehensive income for the period, net of tax

913 1 344

Attributable to:

Equity holders of UCB SA

913 1 344

Non-controlling interests

0 0

Total comprehensive income for the period, net of tax

913 1 344

212 213

2.3 Consolidated statement of financial position

For the year ended December 31

€ million Note 2022 2021

Assets

Non-current assets

Intangible assets 

4 816 3 159

Goodwill 

5 340 5 173

Property, plant and equipment 

1 434 1 275

Deferred income tax assets 

756 692

Financial and other assets (including derivative financial instruments) 

218 201

Total non-current assets

12 564 10 500

Current assets

Inventories 

907 878

Trade and other receivables 

1 051 1 239

Income tax receivables 

78 51

Financial and other assets (including derivative financial instruments) 

369 273

Cash and cash equivalents 

899 1 263

Assets of disposal group classified as held for sale .

0 6

Total current assets

3 304 3 710

Total assets

15 868 14 210

Equity and liabilities

Equity

Capital and reserves attributable to UCB shareholders 

9 064 8 386

Non-controlling interests .

0 0

Total equity

9 064 8 386

Non-current liabilities

Borrowings 

2 089 1 252

Bonds 

549 816

Other financial liabilities (including derivative financial instruments) 

99 13

Deferred income tax liabilities 

377 191

Employee benefits 

162 315

Provisions 

171 188

Trade and other liabilities 

119 86

Income tax payables 

126 139

Total non-current liabilities

3 692 3 000

Current liabilities

Borrowings 

88 55

Bonds 

174 0

Other financial liabilities (including derivative financial instruments) 

117 100

Provisions 

191 83

Trade and other liabilities 

2 492 2 555

Income tax payables 

50 31

Liabilities of disposal group classified as held for sale .

0 0

Total current liabilities

3 112 2 824

Total liabilities

6 804 5 824

Total equity and liabilities

15 868 14 210

212 213

UCB | Integrated Annual Report 2022

2.4 Consolidated statement of cash flows

For the year ended December 31

€ million Note

2022 2021

Profit for the year attributable to UCB shareholders

418 1 058

Adjustment for non-cash transactions 

752 239

Adjustment for items to disclose separately under operating cash flow 

91 170

Adjustment for items to disclose under investing and financing cash flows 

58 41

Change in working capital 

- 56 153

Working capital adjustment relating to acquisitions 

- 65 0

Interest received 

28 17

Cash flow generated from operations

1 226 1 679

Tax paid during the period

- 107 - 126

Net cash flow used in (-)/generated by operating activities:

From continuing operations

1 119 1 553

From discontinued operations

0 0

Net cash flow generated by operating activities

1 119 1 553

Acquisition of property, plant and equipment 

- 252 - 282

Acquisition of intangible assets 

- 119 - 211

Acquisition of subsidiaries, net of cash acquired

- 1 212 0

Acquisition of other investments

- 17 - 19

Sub-total acquisitions

- 1 599 - 512

Proceeds from sale of property, plant and equipment

0 1

Proceeds from sale of other activities, net of cash disposed

0 15

Proceeds from sale of other investments

19 9

Sub-total disposals

19 25

Net cash flow used in (-)/generated by investing activities:

From continuing operations

- 1 580 - 487

From discontinued operations

0 0

Net cash flow used in (-)/generated by investing activities:

- 1 580 - 487

Repayment of bonds (-) .

- 262 - 204

Proceeds from borrowings 

1 025 0

Repayments of borrowings (-) 

- 284 - 512

Payment of lease liabilities 

- 46 - 40

Acquisition (-) of treasury shares 

- 42 - 60

Dividend paid to UCB shareholders, net of dividend paid on own shares ., 

- 247 - 240

Interest paid 

- 74 - 63

Net cash flow used in (-)/generated by financing activities:

From continuing operations

70 - 1 119

From discontinued operations

0 0

Net cash flow used in (-)/generated by financing activities

70 - 1 119

Net increase/decrease (-) in cash and cash equivalents

- 391 - 53

From continuing operations

- 391 - 53

From discontinued operations

0 0

Net cash and cash equivalents at the beginning of the period

1 244 1 303

Effect of exchange rate fluctuations

6 - 7

Net cash and cash equivalents at the end of the period

859 1 244

214 215

2.5 Consolidated statement of changes in equity

Attributed to equity holders of UCB SA

2022

€ million

Share capital and

share premium

Treasury shares

Retained earnings

Other reserves

Cumulative

translation

adjustments

Financial assets

at FVOCI

Cash flow hedges

Total

Non-controlling

interests

Total stockholders'

equity

Balance at January 1, 2022

2 614 - 395 6 294 - 56 - 92 59 - 38 8 386 0 8 386

Profit for the period

- - 418 - - - - 418 0 418

Other comprehensive income/loss (-)

- - - 132 272 4 87 495 - 495

Total comprehensive income

- - 418 132 272 4 87 913 0 913

Dividends (Note 42)

- - - 247 - - - - - 247 - - 247

Share-based payments (Note 28)

- - 70 - - - - 70 - 70

Transfer between reserves

- 90 - 90 - - - - - - -

Treasury shares (Note 27)

- - 58 - - - - - - 58 - - 58

Balance at December 31, 2022

2 614 - 363 6 445 76 180 63 49 9 064 0 9 064

Attributed to equity holders of UCB SA

2021

€ million

Share capital and

share premium

Treasury shares

Retained earnings

Other reserves

Cumulative

translation

adjustments

Financial assets

at FVOCI

Cash flow hedges

Total

Non-controlling

interests

Total stockholders'

equity

Balance at January 1, 2021

2 614 - 393 5 463 - 144 - 372 38 65 7 271 1 7 272

Profit for the period

- - 1,058 - - - - 1 058 - 1 058

Other comprehensive income/loss (-)

- - - 87 280 22 - 103 286 - 286

Total comprehensive income

- - 1 058 87 280 22 - 103 1 344 0 1 344

Dividends (Note 42)

- - - 240 - - - - - 240 - - 240

Share-based payments (Note 28)

- - 75 - - - - 75 - 75

Transfer between reserves

- 63 - 63 - - - - - - -

Treasury shares (Note 27)

- - 65 - - - - - - 65 - - 65

Transfer between OCI and reserves

- - - 2 - - 2 - - - -

Movement on NCI

- - - 1 - - - 1 - 1 0

Balance at December 31, 2021

2 614 - 395 6 294 - 56 - 92 59 - 38 8 386 0 8 386

214 215

3. Notes to the consolidated

financial statements

1. General information 217

2. Additional disclosures related

to 2022 specific topics 217

3. Summary of significant accounting policies 219

4. Critical judgements and accounting estimates 230

5. Financial risk management 233

6. Segment reporting 240

7. Revenue from contracts with customers 241

8. Business combinations 244

9. Discontinued operations and assets and liabilities of

disposal group classified as held for sale 246

10. Other revenues 246

11. Operating expenses by nature 246

12. Employee benefit expense 247

13. Other operating income/expenses 247

14. Impairment of non-financial assets 248

15. Restructuring expenses 248

17. Financial income and financial expenses 248

16. Other income/expenses 248

18. Income tax expense (-)/credit 249

19. Components of other comprehensive income

(including NCI) 250

20. Intangible assets 251

21. Goodwill 252

22. Property, plant and equipment 253

23. Financial and other assets 254

24. Inventories 256

25. Trade and other receivables 256

26. Cash and cash equivalents 258

27. Capital and reserves 258

28. Share-based payments 259

29. Borrowings 263

30. Bonds 264

31. Other financial liabilities 265

32. Deferred tax assets and liabilities 266

33. Employee benefits 268

34. Provisions 272

35. Trade and other liabilities 273

36. Income tax payables 274

37. Note to the consolidated statement of cash flows 275

38. Financial instruments by category 276

39. Derivative financial instruments 278

40. Leases 280

41. Earnings per share 281

42. Dividend per share 282

43. Commitments and contingencies 282

44. Related party transactions 284

45. Events after the statement of financial position date 286

46. UCB Companies (fully consolidated) 287

216 217

UCB | Integrated Annual Report 2022

1. General information

UCB SA/NV (UCB or the Company) and its subsidiaries

(together the Group) is a global biopharmaceutical company

focused on severe diseases in two main therapeutic areas

namely Neurology and Immunology.

The consolidated financial statements of the Company as

at and for the year ended December 31, 2022 comprise the

Company and its subsidiaries. Within the Group, UCB Pharma

SA, UCB Biopharma SRL, UCB S.R.O and UCB Inc., all wholly

owned subsidiaries, have branches. UCB Pharma SA and UCB

Biopharma SRL have branches in the U.K., UCB S.R.O and UCB

Inc. have branches respectively in Slovakia and Puerto Rico.

These branches are integrated into their accounts.

UCB SA/NV, the parent company, is a limited liability company

incorporated and domiciled in Belgium.

The registered office is at 60, Allée de la Recherche, B-1070

Brussels, Belgium. UCB SA/NV is listed on the Euronext Brussels

Stock Exchange.

The Board of Directors approved these consolidated financial

statements and the statutory financial statements of UCB SA for

issue on February 22, 2023. The shareholders will be requested

to approve the statutory financial statements of UCB SA at their

annual meeting on April 27, 2023.

2. Additional disclosures related to 2022 specific topics

2.1 Current and expected impact of the COVID-19

situation on the financial position, performance and

cash-flows of UCB

UCB has put measures in place to protect the health and

wellbeing of its employees and other key stakeholders

especially its patients, while remaining focused on ensuring

business critical activities are properly maintained.

The direct impact of the COVID-19 pandemic on

UCB’s financial position, performance and cash-flows

has been limited.

Revenues, supply chain, production, clinical development

programs, income tax expenses, liquidity position, financial

risks have not been materially impacted by the COVID-19

pandemic. No significant risk of material adjustment to the

carrying amounts of assets and liabilities has arisen as a result of

the pandemic. Lifetime expected credit losses for receivables

are not impacted.

As this global situation evolves, UCB will continue to protect

the health and wellbeing of its employees and other key

stakeholders, to take the steps necessary to safeguard the

reliable supply of its medicines and to monitor the impact on

its financial position, performance and cash-flows and will

implement changes as necessary.

2.2 Impact of Russia’s invasion of Ukraine on the financial

position, performance and cash-flows of UCB

Since the beginning of Russia’s invasion into Ukraine in 2022,

UCB continued to bring medicines to patients with severe

diseases in Ukraine and Russia. Guided by its purpose of

creating value for patients, now and in the future and its focus

on contributing to a more inclusive and sustainable world,

UCB is driven to limit the impact of this unfortunate war on its

employees, patients and their respective communities.

UCB feels responsible to bring medicines to people living in

Ukraine and Russia no matter how difficult the circumstances.

UCB does everything within its power to ensure patients have

access to their medicines. This is extremely difficult because

of disrupted supply chains. In spite of this, UCB continues

to investigate short and longer-term solutions to ensure

availability of its medicines in the region. So far, UCB has

donated 1.6 million doses of anti-epileptics and 35 000 daily

doses of antihistamines.

To support humanitarian efforts, UCB has donated

€ 300 000 to the German International Rescue

Committee and the Belgian International Red Cross,

€ 500 000 for 10 ambulances and did not claim back taxes for

€ 300 000. UCB is also examining how to support people who

have fled to safer places in the long-term, through the UCB

Community Health Fund.

UCB is still bringing medicines to patients in Russia but has

reviewed the way in which its business is conducted there.

Profits generated in Russia will be donated to help the people

of Ukraine. For this donation, a provision for an amount of

€ 7 million (see Note 3.13) has been set up in the consolidated

financial statements as per December 31, 2022.

UCB has already stopped enrolling new patients and is not

starting up any new sites or clinical trials in Russia. UCB is

no longer undertaking marketing and medical events and is

exploring other steps to support the U.S./U.K./EU sanctions.

These sanctions are monitored daily by Global Trade

Compliance and the necessary restrictions are implemented in

a timely way by the different departments involved.

UCB suspended its commercial activities in Ukraine for a while

but these have been resumed in the second half of the year.

There is no material direct or indirect impact of Russia’s

invasion of Ukraine and the sanctions imposed on the strategic

orientation and targets, operations, financial performance,

financial position and cash-flows of UCB group.

Revenues have not been materially impacted. There have not

been any major disruptions in the Group supply chains and/or

uncertainties regarding production.

No additional principal risks or uncertainties have been

identified as a result of Russia’s invasion of Ukraine and

related events.

No significant risk of material adjustment to the carrying

amounts of assets and liabilities has arisen.

There are no material judgements made or significant

uncertainties relating to UCB’s consolidated financial

statements as per December 31, 2022 as a consequence of

the situation in Ukraine and there is no going concern risk

for UCB Group.

216 217

There is no significant increase in credit risk due to the effect

of invasion-induced events and there is no material impact

on the measurement of expected credit losses (ECL) taking

into account forward-looking information. The sales are still

covered by a credit insurance, and there are at this moment

no concerns to collect the cash, however the cash levels are

limited to a minimum at the Russian subsidiaries.

There is no significant amount of cash and cash equivalents

balances that is not available for use by the Group. There is

no significant exposure to liquidity and currency risk and no

material impact on the related sensitivities with respect to

UCB’s investments affected by Russia’s invasion of Ukraine.

There is no impact on UCB’s hedge accounting relationships.

The invasion has not had any major impact on the liquidity

position of UCB group. The liquidity risk management strategy

is still adequate and appropriate and has not changed.

UCB has assessed that nor the direct nor the indirect effects of

Russia’s invasion of Ukraine constitute an indication that one or

more assets in the scope of IAS 36 may be impaired.

Sensitivity analyses as disclosed in Note 5.1.2 of these

annual consolidated financial statements for the year ended

December 31, 2022 are not materially impacted by the invasion

of Russia in Ukraine and related events.

Russia’s invasion of Ukraine has impacted the interest rates

and inflation trends. Consequently, the discount rate used to

determine the recoverable amount has been updated to reflect

these developments but has not led to significant changes

compared to the last tests performed.

As a result of the invasion or the sanctions imposed, there are

no changes in facts and circumstances that may significantly

limit UCB’s ability to exercise its rights or governance provisions

with respect to its Russian or Ukrainian subsidiary.

Currently, the expected future direct and/or indirect impacts

of Russia’s invasion of Ukraine and the sanctions imposed on

UCB’s financial performance, financial position and cash-flows

and related risks are assessed as not material but UCB will

continuously monitor for potential impacts.

UCB has not applied for and does not consider to apply for

public support measures. UCB does not intend to materially

change its risk hedging strategy to address any direct or indirect

impacts of Russia’s invasion of Ukraine.

2.3 Impact of climate-related risks on the financial position,

performance and cash-flows of UCB

UCB is committed to take environmental topics into

consideration when developing its business strategy. Within the

environmental risks and processes identified and disclosed on

a yearly basis in the Risk Management section of this Integrated

Annual Report, UCB assessed its exposure to climate-

related risks and opportunities in alignment with the TCFD

recommendations.

UCB performed climate scenario analysis for physical and

transition risks and opportunities. Four scenarios and three

different time horizons were considered in this analysis.

Heavy precipitation and flooding as well as water scarcity

were identified as key physical risks. UCB’s assessment of the

financial implications and financial quantification in 2050

have been disclosed in the Data and reporting section of this

Integrated Annual Report (see Task force on climate-related

financial disclosures statement).

For transition risks, two risks were selected for the in-depth

analysis being:

• increased costs due to carbon pricing schemes

• shift in market expectations: decreased revenues due to an

increased demand for low-carbon products

For each of these risks, financial implications and quantification

in 2030 have been disclosed in the Data and reporting section

of this Integrated Annual Report (see Task force on climate-

related financial disclosures statement).

The financial impact assessment took into consideration

impact on revenue, impact on costs of sales and operating

expenses, impact on capital expenditures, impact on inventory

and cash flow, and impact on market value and reputation.

UCB will incorporate the findings of the scenario analysis

into its risk management system, long-term strategy, and risk

mitigation planning and will continue to assess and identify any

climate risks and opportunities in the future.

2.4 Impact of macroeconomic situation on the financial

position, performance and cash-flows of UCB

During 2022 there was a rapid rise in inflation. UCB, like many

other companies, is experiencing the effect of rising inflation

and interest rates which touch many aspects of UCB’s business

including increasing costs such as raw materials and wages.

Strong cost discipline enabled UCB to mitigate these effects

in 2022. The macroeconomic situation has not had any major

impact on negotiations of contract terms or investment or

financing decisions.

218 219

UCB | Integrated Annual Report 2022

3. Summary of significant accounting policies

The accounting policies applied in the preparation of these

consolidated financial statements are set out below. These

policies have been consistently applied to all the years

presented, unless otherwise stated.

3.1 Basis of preparation

The consolidated financial statements of the Company have

been prepared in accordance with International Financial

Reporting Standards (IFRS) and interpretations issued by the

IFRS Interpretations Committee (IFRS IC) as endorsed by the

European Union as of December 31, 2022.

The preparation of consolidated financial statements in

conformity with IFRS requires the use of certain critical

accounting estimates. It also requires management to exercise

its judgement in the process of applying the Group accounting

policies. The areas involving a higher degree of judgment

or complexity, or areas where assumptions and estimates

are significant to the consolidated financial statements are

disclosed in Note 4.

3.2 New and amended standards adopted by the group

A number of amendments to standards are mandatory for

the first time for the financial year beginning January 1, 2022.

However, the Group does not have to change its accounting

policies or make retrospective adjustments as a result

of adopting these amendments and improvements to

the standards.

UCB has a subsidiary in Turkey, UCB Pharma A.S., with

functional currency being Turkish lira which is the currency

of a hyper-inflationary economy. The assets, liabilities, equity

items, income and expenses of UCB Pharma A.S. have not

been restated in accordance with IAS 29 Hyper-inflation

before being included in the condensed consolidated financial

statements of UCB as per December 31, 2022 because

UCB has assessed the impact of the restatement as being

immaterial. In accordance with UCB’s accounting policies as

disclosed in this 2022 Integrated Annual Report, assets and

liabilities of UCB Pharma A.S. are translated at the rate as per

December 31, 2022. Income and expenses are translated at the

average exchange rate of December 2022.

The impact of the IFRS Interpretations Committee’s

March 2021 decision relating to configuration or customization

costs in a cloud computing arrangement has been analyzed

by UCB and has led to an immaterial additional cost in the

income statement.

3.3 New standards and amendments to standards

not yet adopted

There are no standards or amendments or improvements to

standards that have been issued by the IASB that are not yet

effective and that would be expected to have a material impact

on the Group’s consolidated financial statements.

3.4 Consolidation

3.4.1 Subsidiaries

Subsidiaries are all entities (including structured entities) over

which the Group has control. The Group controls an entity

when the Group is exposed to, or has rights to, variable returns

from its involvement with the entity and has the ability to affect

those returns through its power over the entity. Subsidiaries are

fully consolidated from the date on which control is transferred

to the Group. They are de-consolidated from the date that

control ceases.

The Group uses the acquisition method of accounting to

account for business combinations. The consideration

transferred for the acquisition of a subsidiary is the fair value

of the assets transferred, the liabilities incurred and the equity

interests issued by the Group. The consideration transferred

includes the fair value of any asset or liability resulting from

a contingent consideration agreement. Acquisition-related

costs are expensed as incurred. Identifiable assets acquired

and liabilities and contingent liabilities assumed in a business

combination are measured initially at their fair values at

acquisition date. On an acquisition-by-acquisition basis,

the Group recognises any non-controlling interest in the

acquiree either at fair value or at the non-controlling interest’s

proportionate share of the acquiree’s net assets.

Any contingent consideration to be transferred by the Group

is recognized at fair value at the acquisition date. Subsequent

changes to the fair value of the contingent consideration that

is deemed to be an asset or liability is recognized in profit or

loss. Contingent consideration that is classified as equity is

not remeasured, and its subsequent settlement is accounted

for within equity.

Goodwill is initially measured as the excess of the aggregate

of the consideration transferred and the fair value of non-

controlling interest over the net identifiable assets acquired and

liabilities assumed. If this consideration is lower than the fair

value of the net assets of the subsidiary acquired, the difference

is recognized in profit or loss.

Inter-company transactions, balances and unrealized gains

on transactions between Group companies are eliminated.

Unrealized losses are also eliminated unless the transaction

provides evidence of an impairment of the asset transferred.

Accounting policies of subsidiaries have been changed

where necessary to ensure consistency with the policies

adopted by the Group.

3.4.2 Changes in ownership interests in subsidiaries without

change of control

The Group treats transactions with non-controlling interests

that do not result in a loss of control as transactions with equity

owners of the Group. For purchases from non-controlling

interests, the difference between any consideration paid and

the relevant share acquired of the carrying value of net assets of

the subsidiary is recorded in equity. Gains or losses on disposals

to non-controlling interests are also recorded in equity.

3.4.3 Disposal of subsidiary

When the Group ceases to have control, any retained interest

in the entity is remeasured to its fair value, with the change in

carrying amount recognized in profit or loss. The fair value is

the initial carrying amount for the purposes of subsequently

accounting for the retained interest as an associate, joint

venture or financial asset. In addition, any amounts previously

recognized in other comprehensive income in respect of that

entity are accounted for as if the Group had directly disposed

of the related assets or liabilities. This may mean that amounts

previously recognized in other comprehensive income are

reclassified to profit or loss.

218 219

3.4.4 Associates

Associates are all entities over which the Group has significant

influence but not control, generally accompanying a

shareholding of between 20% – 50% of the voting rights.

Investments in associates are accounted for using the equity

method of accounting and are initially recognized at cost and

the carrying amount is increased or decreased to recognize

the investor’s share of the profit or loss of the investee after

the date of acquisition. The Group’s investment in associates

includes goodwill identified on acquisition.

When the Group ceases to equity account for an investment

because of a loss of significant influence, any retained interest

in the entity is remeasured to its fair value with the change in

carrying amount recognized in profit or loss. The fair value

becomes the initial carrying amount for the purposes of

subsequently accounting for the retained interest as a financial

asset. In addition, any amounts previously recognized in other

comprehensive income in respect of that entity are accounted

for as if the Group had directly disposed of the related assets or

liabilities. This may mean that amounts previously recognized

in other comprehensive income are reclassified to profit or loss

where appropriate.

If the ownership interest in an associate is reduced but

significant influence is retained, only a proportionate share of

the amounts previously recognized in other comprehensive

income are classified to profit or loss where appropriate.

The Group share of its associates’ post-acquisition profits or

losses is recognized in the income statement, and its share

of post-acquisition movements in other comprehensive

income is recognized in other comprehensive income with

a corresponding adjustment to the carrying amount of the

investment. The cumulative post-acquisition movements are

adjusted against the carrying amount of the investment. When

the Group’s share of losses in an associate equals or exceeds

its interest in the associate, including any other unsecured

receivables, the Group does not recognize further losses,

unless it has incurred obligations or made payments on behalf

of the associate.

The carrying amount of investments in associates is tested

for impairment in accordance with the policy described in

Note 3.10. Unrealized gains on transactions between the

Group and its associates are eliminated to the extent of the

Group’s interest in the associates. Unrealized losses are also

eliminated unless the transaction provides evidence of an

impairment of the asset transferred. Accounting policies of

associates have been changed where necessary to ensure

consistency with the policies adopted by the Group.

Dilution gains and losses arising in investments in associates

are recognized in the income statement.

3.4.5 Interests in joint operations

A joint operation is a joint arrangement whereby the parties, or

joint operators that have joint control of the arrangement, have

rights to the assets, and obligations for the liabilities, relating

to the arrangement. Joint control is the contractually agreed

sharing of control of an arrangement, which exists only when

decisions about the relevant activities require the unanimous

consent of the parties sharing control.

When conducting activities under joint operations, the Group

recognizes in relation to its interest in a joint operation:

• its assets, including its share of any assets held jointly;

• its liabilities, including its share of any liability incurred jointly;

• its revenue from the sale of its share of the output arising from

the joint operations;

• its share of the revenue from the sale of the output by the

joint operation;

• its expenses, including its share of any expenses incurred jointly.

When a Group entity transacts with a joint operation in which a

Group entity is a joint operator, the Group is considered to be

conducting the transaction with the other parties to the joint

operation, and gains and losses resulting from the transactions

are recognized in the Group’s consolidated financial

statements only to the extent of the other parties’ interests in

the joint operation.

3.5 Segment reporting

The Group’s activities are in one segment, Biopharmaceuticals.

There are no other significant classes of business, either

singularly or in aggregate. The Chief Operating Decision

Makers, being the Executive Committee, review the operating

results and operating plans, and make resource allocation

decisions on a company-wide basis; therefore UCB operates

as one segment.

3.6 Foreign currency translation

The following important exchange rates were used in preparing

the consolidated financial statements:

Closing rate Average rate

2022 2021 2022 2021

USD

1.071 1.139 1.051 1.182

JPY

140.350 130.980 137.767 129.812

GBP

0.886 0.841 0.852 0.859

CHF

0.988 1.038 1.004 1.081

The closing rates represent spot rates as at December 31, 2022

and December 31, 2021.

3.6.1 Functional and presentation currency

Items included in the individual financial statements of each

of the Group’s entities are measured using the currency

of the primary economic environment in which the entity

operates (the functional currency). The consolidated

financial statements are presented in euro (€), which is the

functional currency of the Company, and the presentation

currency of the Group.

3.6.2 Transactions and balances

Foreign currency transactions are translated into the

functional currency using the exchange rates prevailing at

the date of the transactions. Foreign exchange gains and

losses resulting from the settlement of such transactions and

from the translation at year-end exchange rates of monetary

assets and liabilities denominated in foreign currencies are

recognized in the income statement under Financial income

or Financial expenses (Note 17), except when deferred in other

comprehensive income as qualifying cash flow hedges and

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qualifying net investment hedges or when attributable to part

of the net investment in a foreign operation.

Exchange differences on a foreign currency monetary financial

asset measured at FVOCI are recognized partly in profit or loss

and partly in other comprehensive income. For the purpose

of recognising foreign exchange gains and losses under IAS 21,

the asset is treated as if it were carried at amortised cost in the

foreign currency. Accordingly, foreign exchange differences on

the amortised cost balance and those arising from changes in

amortised cost (such as interest calculated using the effective

interest method and impairment losses) are recognized in

profit or loss. All other gains and losses (that is, changes in fair

value, including exchange differences thereon) are recognized

in other comprehensive income.

Exchange differences on a foreign currency non-monetary

financial asset measured at FVOCI are recognized in other

comprehensive income as part of the fair value gain or loss.

3.6.3 Group companies

The results and financial position of all Group entities (none

of which has the currency of a hyperinflationary economy

except for the Turkish entity) that have a functional currency

different from the presentation currency are translated into the

presentation currency as follows:

• assets and liabilities for each statement of financial position

presented are translated at the closing rate at the date of that

statement of financial position;

• income and expenses for each income statement are

translated at average exchange rates (unless this average is not

a reasonable approximation of the cumulative effect of the

rates prevailing on the transaction dates, in which case income

and expenses are translated at the rate on the dates of the

transactions); and

• all resulting exchange differences are recognized in

other comprehensive income (referred to as “cumulative

translation adjustments”).

On consolidation, exchange difference arising from the

translation of the net investment in foreign operations, and

of borrowings and other currency instruments designated as

hedges of such investments, are taken to other comprehensive

income. When a foreign operation is partially or wholly

disposed of or sold, exchange differences that were recorded

in equity are recognized in the income statement as part of the

gain or loss on sale.

Goodwill and fair value adjustments arising on the acquisition

of a foreign entity are treated as assets and liabilities of the

foreign entity and translated at the closing rate.

3.7 Revenue

Revenue is recognized when control of a good or service

transfers to a customer.

3.7.1 Net sales

Net sales encompass revenue recognized resulting from

transferring control over products to the customer.

The amount of revenue recognized is the amount allocated

to the satisfied performance obligation taking into account

variable consideration. The estimated amount of variable

consideration is included in the transaction price only to the

extent that it is highly probable that a significant reversal in the

amount of cumulative revenue recognized will not occur when

the uncertainty associated with the variable consideration is

subsequently resolved. Variable consideration that is included

in the transaction price relates to sales returns, rebates, trade

and cash discounts, charge-backs granted to various customers

that are part of commercial and governmental contractual

arrangements or other reimbursement programs, including the

U.S. Medicaid Drug Rebate program, the U.S. Federal Medicare

program and others as well as the U.S. Branded Prescription

Drug Fee. A liability is recognized for expected sales returns,

rebates, trade and cash discounts, charge-backs or other

reimbursements payable directly or indirectly to customers

in relation to sales made until the end of the reporting period.

Payment terms can differ from contract to contract but

no element of financing is deemed present. Therefore the

transaction price is not adjusted for the effects of a significant

financing component. A receivable is recognized as soon as

control over the products is transferred to the customer as this is

the point in time that the consideration is unconditional because

only the passage of time is required before the payment is due.

The transaction price is adjusted for any consideration payable

to the customer (directly or indirectly) that is economically

linked to the revenue contract unless the payment is for distinct

services received from the customer. In the latter case, the fair

value of the services received is estimated and accounte d for

as part of marketing and selling expenses.

The amount of variable consideration is estimated on the

basis of historical experience and the specific terms in the

individual agreements.

Net sales are presented net of value added tax, other sales

related taxes or any other amounts collected on behalf of third

parties such as the government or governmental institutions.

3.7.2 Royalty income

Sales-based royalties resulting from the out-licensing of IP

are recognized as the subsequent underlying sales occur

provided that the related performance obligation has been

satisfied by then.

3.7.3 Other revenue

Other revenue comprises revenue generated through out-

licensing and profit-sharing agreements as well as contract

manufacturing agreements. The underlying performance

obligations can be satisfied at a point in time or over time

depending on the specific situation.

For performance obligations satisfied over time, revenue is

recognized based on a pattern that best reflects the transfer

of control of the service to the customer. Usually this progress

is measured by an input method whereby costs incurred and

hours expended relative to total costs expected to be incurred

and total hours expected to be expended are used as a basis.

Any variable consideration that is promised in exchange of a

license of IP and that is based upon achieving certain sales

targets, is accounted for in the same way as sales-based

royalties i.e. at the moment the related sales occur provided

that the related performance obligation has been satisfied.

Any variable consideration such as a development milestone

payment that is promised in exchange for development

services or the license of IP, is only included in the transaction

price as from the moment the achievement of the related

milestone event is highly probable, which then results in a

catch up of revenue at that moment for any performances up

till that moment.

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Any upfront payments or license fees for which there are

subsequent performance obligations, are initially reported

as deferred revenue and are recognized as revenue when

performance obligations are satisfied over the period of the

development collaboration or manufacturing obligation.

3.7.4 Interest income

Interest is recognized on a time proportion basis that takes into

account the effective yield on the asset.

3.7.5 Dividend income

Dividends are recognized when the shareholder’s right to

receive the payment is established.

3.8 Cost of sales

Cost of sales includes primarily the direct production costs,

related production overheads and the amortization of the

related intangible assets as well as services rendered. Start-

up costs are expensed as incurred. Royalty expenses directly

linked to goods sold are included in “cost of goods sold”.

3.9 Research and development

3.9.1 Internally generated intangible assets, research and

development expenditure

All internal research costs are expensed as incurred. Internal

development expenditure is capitalized only if it meets the

recognition criteria of IAS 38 Intangible Assets. Due to long

development periods and significant uncertainties related to

the development of new products (such as the risks related

to the outcome of clinical trials as well as the likelihood of

regulatory approval), internal development costs generally

do not qualify for capitalization as intangible assets. At

December 31, 2022, no internal development expenditures

have met the recognition criteria.

3.9.2 Acquired intangible assets

Payments for acquired in-process research and development

projects obtained through in-licensing arrangements, business

combinations or separate asset purchases are capitalized as

intangible assets provided that they are separately identifiable,

controlled by the Group and expected to provide future

economic benefits. As the probability criterion in IAS 38 is

always considered to be satisfied for separately acquired

research and development assets and the amount of the

payments is determinable, upfront and milestone payments

to third parties for pharmaceutical products or compounds

for which regulatory marketing approval has not yet been

obtained are recognized as intangible assets, and amortized

on a straight line basis over their useful lives from the date on

which the products are launched for sale.

3.10 Impairment of non-financial assets

At each reporting date, the Group reviews the carrying

amounts of its intangible assets, goodwill, property, plant

and equipment and investments in associates to determine

whether there is any indication of impairment. If any such

indication exists, the recoverable amount of the asset is

estimated in order to determine the extent of the impairment

loss. Irrespective of whether there is an indication of

impairment, an impairment assessment of the intangibles not

yet available for use and goodwill is carried out annually. These

assets are not amortized. An impairment loss is recognized for

the amount by which the asset’s carrying amount exceeds its

recoverable amount.

Where it is not possible to estimate the recoverable amount

of an individual asset, the Group estimates the recoverable

amount of the cash-generating unit (CGU) to which the asset

belongs. The recoverable amount is the higher of an asset’s

fair value less costs to sell and value in use. To determine

the value in use, the Group uses estimates of future cash

flows generated by the asset or the CGU, using the same

methods as those used in the initial measurement of the asset

or the CGU on the basis of the medium-term plans of each

business activity. Estimated cash flows are discounted using

an appropriate rate that reflects current market assessments

of the time value of money and the risks specific to the

asset or the CGU.

An impairment loss is recognized directly in the income

statement under the “impairment of non-financial assets”

caption. Non-financial assets other than goodwill that

suffered an impairment are reviewed for possible reversal

of the impairment at each reporting date. The reversal of

the impairment is recognized in the income statement. An

impairment loss is reversed only to the extent that the asset’s

carrying amount does not exceed the carrying amount

that would have been determined, net of depreciation or

amortization, if no impairment loss had been recognized.

Impairment losses on goodwill are never reversed.

Intangible assets are assessed for impairment on a compound

by compound basis.

3.11 Restructuring expenses, other income and expenses

The expenses made by the Group in order to be better

positioned to face the economic environment in which

it operates are presented in the income statement as

“restructuring expenses”.

The gains and losses arising upon the divestment of intangible

assets other than development stage assets or property, plant

and equipment as well as increases or reversals of provisions

for litigations, other than tax litigations or litigations related

to discontinued operations, are presented in the income

statement as “other income and expenses”.

3.12 Income taxes

The tax expense for the period comprises current and

deferred income taxes. Tax expense is recognized in the

income statement except to the extent that it relates to items

recognized in other comprehensive income or directly in

equity. In the case of items recognized in other comprehensive

income or in equity, the tax is also recognized in other

comprehensive income or directly in equity, respectively.

For the accounting policies related to R&D tax credits we refer

to Note 3.13.2 under Government grants.

The current income tax charge is calculated on the basis of the

tax laws enacted or substantively enacted at the statement of

financial position date in the countries where the Company’s

subsidiaries operate and generate taxable income.

Current tax assets and tax liabilities are offset if there is a

legally enforceable right to offset and intention either to settle

on a net basis, or to realize the asset and settle the liability

simultaneously.

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Deferred income tax is recognized, using the liability method,

on temporary differences arising between the carrying

amounts of assets and liabilities in the consolidated financial

statements and the corresponding tax bases used in the

computation of taxable profit.

Deferred income tax liabilities are generally recognized

for all taxable temporary differences and deferred income

tax assets are recognized to the extent that it is probable

that future taxable profits will be available against which

deductible temporary differences, carried forward tax credits

or carried forward losses can be utilized, taking into account

the function and risk profile of the taxable entity concerned.

Deferred income tax is not accounted for if it arises from the

initial recognition of goodwill or from the initial recognition

of an asset or liability in a transaction (other than in a business

combination) that at the time of the transaction affects neither

accounting nor taxable profit.

The carrying amount of deferred income tax assets is reviewed

at each statement of financial position date and reduced to the

extent that it is no longer probable that sufficient taxable profits

will be available to allow all or part of the asset to be recovered.

Deferred income tax is calculated at the tax rates that are

expected to apply in the period when the liability is settled, or

the asset realized. The Group only considers substantively

enacted tax laws when estimating the amount of deferred

taxes to be recognized. Deferred tax assets and liabilities are

not discounted.

Deferred tax liabilities and assets are not recognized for

temporary differences between the carrying amount and

tax bases of investments in foreign operations where the

Company is able to control the timing of the reversal of the

temporary differences and it is probable that the differences

will not reverse in the foreseeable future.

Deferred tax assets and liabilities are only offset if there is a

legally enforceable right to offset current tax liabilities and

assets and the deferred income taxes relate to the same taxable

entity and the same taxation authority.

3.13 Government grants

Grants from the government are recognized at their fair

value where there is a reasonable assurance that the

grant will be received and the Group will comply with all

attached conditions.

3.13.1 Recoverable cash payments received

from the government

The Group receives cash payments from the government to

partially finance certain research and development projects.

The cash payments received from the government are

repayable in cash only if the Group decides to exploit and

commercialize the results of the research phase of the related

project. If the Group decides not to proceed with the results

from the research phase, the cash payments are not repayable.

In this case the rights to the research need to be transferred

to the government. When the Group receives these cash

payments, these are accounted for as other non-current

liabilities. Only at the moment when there is reasonable

assurance that the Group will not have to reimburse the

cash payments, these cash payments are accounted for as

government grants and taken up in “other operating income”.

More specifically, this is at the moment the government

confirms the receipt of the research results and its agreement

with the Group’s decision not to proceed with the research.

3.13.2 R&D tax credit

The R&D tax credit is considered as a government grant

related to assets if no additional relevant requirements are to

be met that are not directly related to the asset. The tax credit

is taken in profit and loss in line with the costs it is intended

to compensate. If the tax credit is received to compensate

research and development expenses that are not capitalized,

the R&D tax credit is recognized in P&L at the same moment

as the research and development expenses as a credit to the

line “Research and development expenses”. If the tax credit is

received to compensate amortizations on intangible assets e.g.

licenses, the R&D tax credit is recognized in profit and loss over

the (remaining) useful life of the asset and reported as “Other

operating income”.

The part of the R&D tax credit that cannot be deducted from

the taxable income is accounted for as a deferred tax asset.

In this case, the R&D tax credit can either (i) be received as a

cash tax refund after the legally foreseen waiting period or (ii)

be offset against future taxable income. If the R&D tax credit

is not refundable by the tax authorities, the recoverability of

the deferred tax asset is assessed on a regular basis as for the

other deferred tax assets. The part of the R&D tax credit that

can be deducted from taxable income is debited to the current

income tax liability.

3.14 Intangible assets

3.14.1 Patents, licenses, trademarks and other

intangible assets

Patents, licenses, trademarks and other intangible assets

(collectively referred to as “intangible assets”) are shown

at historical cost. Intangible assets acquired in a business

combination are recognized at fair value at the acquisition date.

Intangible assets (except for goodwill) are amortized over their

useful lives on a straight-line basis as from the moment they are

available for use (i.e., in case of a license related to a compound

or product, when the product (containing the compound) is

launched for sale). Estimated useful life is based on the lower of

the contract life or the economic useful life (generally between

5 to 20 years). Intangible assets (except for goodwill) are

considered to have a finite economic useful life; therefore no

intangible assets with an indefinite life have been identified.

3.14.2 Computer software

Acquired computer software licenses are capitalized on

the basis of the costs incurred to acquire and bring to use

the specific software. These costs are amortized over their

estimated useful lives (3 to 5 years) on a straight-line basis.

3.15 Goodwill

Goodwill arises on the acquisition of subsidiaries and

associates and represents the excess of the consideration

transferred over the Group’s interest in the net fair value of the

net identifiable assets, liabilities and contingent liabilities of

the acquiree and the fair value of the non-controlling interest

in the acquiree.

Goodwill is initially recognized as an asset at cost and is

subsequently carried at cost less accumulated impairment

losses. Goodwill related to the acquisition of subsidiaries

is presented separately on the face of the statements of

financial position, whereas goodwill arising upon acquisition

222 223

of associated companies is included in the investment in

associated companies.

UCB operates as one segment and has one cash generating

unit for the purpose of impairment testing.

As goodwill is considered to have an indefinite life, it is tested

for impairment annually, and whenever there is an indication

that it may be impaired, by comparing its carrying amount with

its recoverable amount. If the recoverable amount of the cash-

generating unit is less than the carrying amount of the unit, the

impairment loss is allocated first to reduce the carrying amount

of any goodwill allocated to the unit and then to the other

assets of the unit pro rata on the basis of the carrying amount

of each asset in the unit. Impairment losses on goodwill

are not reversed.

On disposal of a subsidiary or an associate, the attributable

amount of goodwill is included in the determination of the

profit or loss on disposal of the entity.

In the event that the fair value of the identifiable assets, liabilities

and contingent liabilities exceeds the cost of the business

combination, the excess remaining after reassessment is

recognized directly in profit or loss.

3.16 Property, plant and equipment

All property, plant and equipment are carried at cost less

accumulated depreciation and impairment losses except for

property, plant and equipment under construction, which is

carried at cost less accumulated impairment losses.

Cost includes all directly attributable costs of bringing the asset

to its working condition for its intended use.

Purchased software that is integral to the functionality of the

related equipment is capitalized as part of that equipment.

Borrowing costs directly attributable to the acquisition,

construction or production of a qualifying asset are capitalized

as part of the cost of that asset.

Subsequent costs are included in the asset’s carrying amount

or recognized as a separate asset, as appropriate, only when

it is probable that future economic benefits associated with

the item will flow to the Group and the cost of the item can

be measured reliably. All other repairs and maintenance are

expensed as they are incurred.

Depreciation is calculated using the straight-line method to

allocate the cost of assets, other than land and properties

under construction, to their residual values over their estimated

useful lives. Depreciation commences when the asset is ready

to be used. Land is not depreciated.

The residual value and the useful life of an asset are reviewed

at least at each financial year-end and, if expectations differ

from previous estimates, the change(s) is(are) accounted

for as a change in an accounting estimate in accordance

with IAS 8 Accounting Policies, Changes in Accounting

Estimates and Errors.

The following useful lives are applicable to the main property,

plant and equipment categories:

Buildings 20 – 33 years

Machinery 7 – 15 years

Laboratory equipment 7 years

Prototype equipment 3 years

Furniture and fixtures 7 years

Vehicles 5 – 7 years

Computer equipment 3 years

Right-of-use assets

Shorter of asset’s useful life

and leasing term

Gains and losses on disposals are determined by comparing

the proceeds from disposal with the carrying amount and

are recognized under “other income and expenses” in the

income statement.

Investment property is indicative of land and buildings held

to earn rentals. Such assets are initially carried at cost and

depreciated on a straight-line basis over their estimated

useful lives. The underlying useful lives correspond to those

of self-used tangible assets. Given the insignificant amount

of investment property, it is not separately presented in the

statement of financial position.

3.17 Leases

The Group leases various properties, equipment and cars

and the rental contracts are typically made for a fixed, short

or long term period. Lease terms are negotiated on an

individual basis and contain a wide range of different terms

and conditions. The lease agreements do not impose any

covenants, but leased assets may not be used as security for

borrowing purposes.

Leases are recognized as a right-of-use asset and

corresponding liability at the date of which the leased asset is

available for use by the Group. Each lease payment is allocated

between the liability and finance cost. The finance cost is

charged to the income statement over the lease period so as to

produce a constant periodic rate of interest on the remaining

balance of the liability for each period. The right-of-use asset

is depreciated over the shorter of the asset’s useful life and the

lease term on a straight-line basis.

Assets and liabilities arising from a lease are initially measured

on a present value basis. Lease liabilities include the net present

value of the following lease payments:

• fixed payments (including in-substance fixed payments), less

any lease incentives receivable;

• variable lease payments that are based on an index or a rate.

There are no leases for which it is expected that the Group

would need to pay a residual value guarantee or a certain

amount to exercise a purchase option whereby it is reasonable

certain that the Group will exercise this option or any penalties

for terminating the lease in case the lease term reflects that the

Group will exercise this option.

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The lease payments are discounted using the interest rate

implicit in the lease, if that rate can be determined, or the

Group’s incremental borrowing rate.

Right-of-use assets are measured at cost

comprising the following:

• the amount of the initial measurement of lease liability;

• any lease payments made at or before the

commencement date;

• any initial direct costs (except for the leases already existing at

transition date), and

• restoration costs.

Right-of-use assets are presented as part of property, plant

and equipment and lease liabilities as part of borrowings in the

statement of financial position. All lease payments that are due

within 12 months are classified as current liabilities. All lease

payments that are due at least 12 months after the statement of

financial position date are classified as non-current liabilities.

Payments associated with short-term leases and leases of

low-value assets are recognized on a straight-line basis as an

expense in profit or loss. Short-term leases are leases with a

lease term of 12 months or less. Low-value assets comprise

mainly IT-equipment (laptops, tablets, mobile phones, pc’s) and

small items of office equipment and furniture.

Some of the car leases contain variable lease payments. It

concerns car lease agreements that contain a Terminal Rental

Adjustment Clause (TRAC): a final settlement calculation is

made at termination of the lease to determine the final rental

adjustment. This final rent adjustment is a rent payment (or

credit) that reflects actual usage of the vehicle while under

lease. This final amount is not known at lease commencement.

The rental adjustment amount is not a specified amount but

depends upon known factors such as monthly depreciation

and initial acquisition cost, and several unknown factors at

lease commencement, such as mileage, condition of the

vehicle, wear and tear, damage, geography of operation,

disposal channel, and other factors. Together, these factors

generally represent “use” of the vehicle. Payments that vary due

to use of the underlying asset and vehicle mileage specifically

are variable lease payments. The final rental adjustment is

recognized as expense or, in case of a credit, as a reduction of

expenses when realized.

Extension options are included in a number of property and

car leases across the Group. These terms are used to maximize

operational flexibility in terms of managing contracts. The

extension options held are exercisable only by the Group and

not by the respective Lessor.

There are no material lease agreements whereby the

Group is lessor.

3.18 Financial assets investments

3.18.1 Classification

The Group classifies its financial assets in the following

measurement categories: those to be measured subsequently

at fair value through profit or loss (FVPL), those to be measured

subsequently at fair value through other comprehensive

income (FVOCI), those to be measured at amortised cost.

The classification depends on the Group’s business model for

managing the financial assets and the contractual terms of

the cash flows.

Investments are included in non-current assets unless

management intends to dispose of the investment within 12

months of the statement of financial position date.

Regular purchases and sales of financial assets are recognized

on the trade date – the date on which the Group commits to

purchase or sell the asset. Financial assets are derecognized

when the rights to receive cash flows from the investments

have expired or have been transferred and the Group has

transferred substantially all risks and rewards of ownership.

For assets measured at fair value, gains and losses will either

be recorded in profit or loss or other comprehensive income

(OCI). For investments in equity instruments that are not held

for trading, this will depend on whether the Group has made an

irrevocable election at the time of initial recognition to account

for the equity investment at fair value through OCI (FVOCI).

3.18.2 Measurement

At initial recognition, the Group measures a financial asset at

its fair value plus, in case of a financial asset not at fair value

through profit or loss (FVPL), transaction costs that are directly

attributable to the acquisition of the financial asset. Transaction

costs of financial assets carried at FVPL are expensed in

profit or loss.

Financial assets with embedded derivatives are considered in

their entirety when determining whether their cash flows are

solely payment of principal and interest.

Debt instruments

The Group currently does not have any investments in

debt instruments.

Equity instruments

The Group subsequently measures all equity investments at fair

value. Where the Group’s management has elected to present

fair value gains and losses on equity investments in OCI, there

is no subsequent reclassification of fair value gains and losses

to profit or loss following the derecognition of the investment.

Dividends from such investments continue to be recognized

in profit or loss as financial income when the Group’s right to

receive payments is established.

Impairment losses (and reversal of impairment losses) on

equity investments measured at FVOCI are not reported

separately from other changes in fair value.

Changes in the fair value of financial assets at FVPL

are recognized in financial income / expenses in the

income statement.

The fair value of listed investments is based on current bid

prices. If the market for a financial asset is not active (and for

unlisted securities), the Group establishes fair value by using

valuation techniques.

3.19 Derivative financial instruments and hedging activities

The Group uses derivative financial instruments to hedge its

exposure to foreign exchange and interest rate risks arising

from operational, financing and investment activities. The

Group does not engage in speculative transactions.

Derivative financial instruments are initially recorded at fair

value and attributable transaction costs are recognized in

the income statement when incurred. Derivative financial

instruments are subsequently remeasured at their fair value.

224 225

The Group includes the credit and the nonperformance risks

into its valuation techniques leading to non-material impact

on derivative valuation resulting from credit or debit margin

adjustments made on counterparts with who financial market

transactions are contracted.

The method of recognizing the resulting gains or losses

depends on whether the derivative financial instrument is

designated as a hedging instrument and if so, the nature of the

item being hedged. The Group designates derivative financial

instruments as either cash flow hedges, fair value hedges or net

investment hedges.

The Group documents at inception of the transaction the

economic relationship between the hedging instrument and

the hedged item, as well as its risk management objectives and

strategy for undertaking the hedging transaction. The Group

updates this assessment when required for example when the

hedge ratio is rebalanced or when the analysis of sources of

hedge ineffectiveness is updated.

The full fair value of a hedging derivative financial instrument is

classified as a non-current asset or liability when the remaining

maturity of the hedged item is more than 12 months and as

a current asset or liability when the remaining maturity of the

hedged item is less than 12 months.

Derivative financial instruments embedded in financial liabilities

are separated from the host contract and accounted for

separately if the economic characteristics and risks of the host

contract and the embedded derivative financial instrument

are not closely related, a separate instrument with the same

terms as the embedded derivative financial instrument would

meet the definition of a derivative financial instrument, and the

combined instrument is not measured at fair value through

profit or loss.

3.19.1 Cash flow hedges

The effective portion of changes in the fair value of derivative

financial instruments that are designated and qualify as cash

flow hedges is recognized in other comprehensive income.

The gain or loss relating to the ineffective portion is recognized

immediately in the income statement within “Financial income/

Financial expenses”.

When option contracts are used to hedge a firm commitment

or forecast transaction, the group designates only the intrinsic

value of the options as the hedging instrument. Gains or losses

relating to the effective portion of the change in intrinsic value

of the options are recognized in other comprehensive income.

The changes in the time value of the options that relate to the

hedged item (‘aligned time value’) are also recognized within

OCI. These will be moved to the income statement (financial

income / expenses) when the hedged transaction affects the

P&L (in case of transaction related hedges) or over the period

of the hedge (in case of time-period related hedges).

When forward contracts are used to hedge forecast

transactions, the Group generally designates only the change

in fair value of the forward contract related to the spot

component as the hedging instrument. Gains or losses relating

to the effective portion of the change in the spot component

of the forward contracts are recognized in OCI. The change in

the forward element of the contract that relates to the hedged

item (‘aligned forward element’) is recognized in the income

statement (financial income / expenses).

Gains or losses relating to the effective portion of the change in

intrinsic value of the options or relating to the effective portion

of the change in the spot component of the forward contracts

accumulated in other comprehensive income are reclassified

to profit or loss in the periods when the hedged item affects

profit or loss on the same line of the income statement where

the designated hedged item affects profit or loss. However

if the cash flow hedge of a firm commitment or forecasted

transaction results in the recognition of a non-financial asset

or a non-financial liability, then, at the time the asset or liability

is recognized, the associated gains or losses on the derivative

financial instrument that had previously been recognized

in other comprehensive income are included in the initial

measurement of the asset or liability.

When hedging with forwards and financial instruments with

foreign currency basis spreads, the Group decides on a

hedging-relationship-by-hedging-relationship basis to account

for the changes in the currency basis spread by applying either

the same accounting as for the time value of options or by

recognizing these changes in value in the income statement

(financial income/expenses).

When a hedging instrument expires, or is sold or terminated,

or when a hedge no longer meets the criteria for hedge

accounting, any cumulative deferred gain or loss in other

comprehensive income at that time remains in other

comprehensive income until the forecast transaction occurs,

resulting in the recognition of a non-financial asset or liability.

When the forecast transaction is no longer expected to occur,

the cumulative gains or losses that were reported in other

comprehensive income are immediately reclassified to the

income statement (financial income/expenses).

3.19.2 Fair value hedges

Changes in the fair value of derivative financial instruments that

are designated and qualify as fair value hedges are recorded

in the income statement under “Financial income/Financial

expenses”, together with any changes in the fair value of the

hedged asset or liability that are attributable to the hedged risk.

3.19.3 Net investment hedges

Hedges of net investments in foreign operations are accounted

for similarly to cash flow hedges. Any gain or loss on the

hedging instrument relating to the effective portion of the

hedge is recognized in the cumulative translation adjustments

reserve; the gain or loss relating to the ineffective portion

is recognized immediately in the income statement within

“Financial income/Financial expenses”. Gains and losses

accumulated in equity are recycled to the income statement

when the foreign operation is partially disposed of or sold.

3.19.4 Derivative financial instruments that do not qualify for

hedge accounting

Changes in the fair value of any derivative financial instruments

that do not qualify for hedge accounting are recognized

immediately in the income statement within “Financial income/

Financial expenses”.

3.20 Inventories

Raw materials, consumables, goods purchased for resale, work

in progress and finished goods are valued at the lower of cost

and net realisable value.

Cost is determined using the weighted average cost method.

The cost of work in progress and finished goods comprises all

the costs of conversion and other costs incurred in bringing

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the inventories to their present location and condition. The

conversion costs include the cost of production and the

related fixed and variable production overhead costs (including

depreciation charges).

Net realisable value represents the estimated selling price less

all estimated costs of completion and costs to be incurred in

marketing, selling and distribution.

Clinical trial materials are active substances and development

supplies that are used in R&D activities. As these are not used to

be sold in the ordinary course of business, these do not meet

the definition of inventory. However these are presented as

other current assets in the statement of financial position as

the clinical trial materials meet the definition of an asset as it is

probable they will result in future economic benefits flowing to

the Group and as their cost or value can be measured reliably.

3.21 Trade receivables

Trade receivables are recognized initially at fair value and are

subsequently measured at amortized cost using the effective

interest rate method, less provision for expected credit losses.

For determining the expected credit losses, the Group applies

the simplified approach permitted by IFRS 9, which requires

lifetime losses to be recognized from initial recognition of

the receivables. The Group identified 2 categories of trade

receivables: receivables on private customers and receivables

on public sector customers. For each of these categories, the

Group makes use of a provision matrix in order to determine

lifetime expected credit losses.

In case there is an indication or evidence of impairment for

a specific receivable, this receivable will be impaired for the

amount of lifetime expected credit losses.

For all receivables that are covered by a credit insurance or by

a factoring agreement without recourse, the lifetime expected

credit losses will be calculated taking into account this cover.

3.22 Cash and cash equivalents

For the purpose of presentation in the Statement of Cash

Flows, cash and cash equivalents comprise cash on hand

and demand deposits and other short-term highly liquid

investments with original maturities of three months or less that

are readily convertible to known amounts of cash and which

are subject to an insignificant risk of changes in value, and bank

overdrafts. Bank overdrafts are shown within borrowings in

current liabilities in the statement of financial position.

3.23 Non-current assets (or disposal groups) held for sale

and discontinued operations

A discontinued operation is a component of the company

that either has been disposed of, or that is classified as held

for sale. It must either: represent a major separate line of

business or geographical area of operations; be part of a

single coordinated disposal plan; or be a subsidiary acquired

exclusively with a view to resale.

Non-current assets or a disposal group are classified as

held for sale when their carrying amount is to be recovered

principally through a sale transaction and a sale is considered

highly probable. Non-current assets and disposal groups are

measured at the lower of the carrying amount and fair value

less costs to sell if their carrying amount will be recovered

principally through a sale transaction rather than through

continuing use. Impairment losses upon initial classification

as held for sale are recognized in the income statement.

Non-current assets classified as held for sale are neither

depreciated nor amortized.

3.24 Share capital

3.24.1 Ordinary shares

Ordinary shares are classified as equity. Incremental costs

directly attributable to the issue of new shares or options are

shown in equity as a deduction, net of tax, from the proceeds.

The Company did not issue any preference or mandatory

redeemable preference shares.

3.24.2 Treasury shares

When any Group company purchases the Company’s equity

share capital (treasury shares), the consideration paid, including

attributable direct costs (net of income taxes) is deducted

from the equity attributable to the Company’s equity holders

until the shares are cancelled or sold. Where such shares are

subsequently sold, any consideration received, net of any

directly attributable incremental transaction costs and the

related income tax effects, is included in equity attributable to

the Company’s equity holders.

3.25 Bonds and borrowings

Bonds, borrowings and overdrafts are initially measured at fair

value, net of transaction costs incurred, and are subsequently

measured at amortized cost, using the effective interest

rate method. Any difference between the proceeds (net

of transaction costs) and the settlement or redemption of

borrowings is recognized over the term of the borrowings in

accordance with the Group accounting policy.

Borrowings are classified as current liabilities unless the Group

has an unconditional right to defer settlement of the liability for

at least 12 months after the statement of financial position date.

3.26 Trade payables

Trade payables are initially measured at fair value and are

subsequently measured at amortized cost using the effective

interest method.

3.27 Employee benefits

3.27.1 Pension obligations

The Group operates various post-employment

schemes, including both defined benefit and defined

contribution pension plans.

A defined contribution plan is a pension plan under which the

Group pays fixed contributions into a separate entity and has

no legal or constructive obligations to pay further contributions

in the event that the fund does not hold sufficient assets to

pay all employees the benefits relating to employee service

in the current and prior periods. Obligations for contributions

to defined contribution pension plans are recognized as

an employee benefit expense in the consolidated income

statement when they are due. Prepaid contributions are

recognized as an asset to the extent that a cash refund or a

reduction in future payments is available.

Typically defined benefit plans define an amount of pension

benefit that an employee will receive on retirement, usually

dependent on one or more factors such as age, years of

service and compensation. The liability recognized in the

consolidated statement of financial position in respect

of defined benefit pension plans is the present value of

the defined benefit obligation less the fair value of plan

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assets. Any surplus resulting from this calculation is limited

to the present value of any economic benefits available in

the form of refunds from the plans or reductions in future

contributions to the plans.

The defined benefit obligation is calculated by independent

actuaries using the Projected Unit Credit Method. A full

actuarial valuation based on updated personnel information

is performed at least every three years. Additionally, if the net

fluctuation recognized on the statement of financial position

is more than 10% from one year to the next due to plan

circumstances (significant membership changes, modification

to plan, etc.), a full actuarial valuation is also required. For years

where a full actuarial valuation is not required, projections

(known as “roll-forwards”) from the previous year with updated

assumptions (discount rate, salary increase, turnover) is used.

For these “roll-forward” valuations, the individual employee

data from the last full valuation date are used taking into

account assumptions for salary increases and possibly turnover.

All valuations measure liabilities at the applicable statement of

financial position date and the market value of retirement plan

assets are also reported at this date regardless of whether a full

or a “roll-forward” valuation is performed.

The present value of the defined benefit obligation is

determined by discounting the estimated future cash outflows

using yields on high quality corporate bonds that have maturity

dates approximating the terms of the related Group obligations

and that are denominated in the same currency in which the

benefits are expected to be paid.

Remeasurement comprising of actuarial gains and losses, the

effect of the asset ceiling (if applicable) and the return on plan

assets (excluding interest) are recognized immediately in the

statement of financial position with a charge or credit to other

comprehensive income in the period in which they occur.

Remeasurement recorded in other comprehensive income is

not recycled. However, the entity may transfer those amounts

recognized in other comprehensive income within equity. Past

service cost is recognized in profit or loss in the period of plan

amendment. Net-interest is calculated by applying the discount

rate to the net defined benefit liability or asset. Defined benefit

costs are split into three categories:

• service cost, past-service cost, gains and losses on curtailments

and settlements;

• net-interest expense or income;

• remeasurement.

The Group presents the first two components of defined

benefit costs in the line item “employee benefits expense” in

its consolidated income statement (by nature of expenses

aggregation). Net-interest expense or income is presented

as part of the Operating profit. Curtailments gains and losses

are accounted for as past-service cost. Remeasurements are

recorded in other comprehensive income.

3.27.2 Other post-retirement employee benefits

Some Group companies provide post-retirement healthcare

benefits to their retirees. The Group’s net obligation is the

amount of future benefits that employees have earned in

return for their service in the current and prior periods. The

expected costs of these benefits are accrued over the period

of employment using the same methodology used for

defined benefit plans.

3.27.3 Termination benefits

Termination benefits are payable when employment is

terminated before the normal retirement date, or when an

employee accepts voluntary redundancy in exchange for

these benefits. The Group recognizes termination benefits

when it is demonstrably committed to either: terminating

the employment of current employees according to a

detailed formal plan without possibility of withdrawal; or

providing termination benefits as a result of an offer made to

encourage voluntary redundancy. Benefits falling due more

than 12 months after statement of financial position date are

discounted to present value.

3.27.4 Other long-term employee benefits

The liabilities for jubilee premiums and long service awards are

measured as the present value of expected future payments

to be made in respect of services provided by employees up

to the end of the reporting period using the projected unit

credit method. Consideration is given to expected future

wage and salary levels, experience of employee departures

and periods of service. Expected future payments are

discounted using yields on high quality corporate bonds with

terms and currencies that match, as closely as possible, the

estimated future cash outflows. Remeasurements as a result of

experience adjustments and changes in actuarial assumptions

are recognized in profit or loss.

3.27.5 Profit-sharing and bonus plans

The Group recognizes a liability and an expense for

bonuses and profit-sharing, based on a formula that takes

into consideration the profit attributable to the company’s

shareholders after certain adjustments. The Group recognizes

a provision when a reliable estimate of the obligation can be

made as there is a past practice for bonus and profit-sharing

payments that has created a constructive obligation.

3.27.6 Share-based payments

The Group operates several equity-settled and cash-settled

share-based compensation plans.

The fair value of the employee services received in exchange

for the grant of stock options is recognized as an expense. The

total amount to be expensed is determined by reference to the

fair value of the stock options granted, excluding the impact of

any service and non-market performance vesting conditions

(for example profitability, remaining an employee of the entity

over a specified time period).

Service and non-market vesting conditions are included in the

assumptions about the number of options that are expected to

vest. The total amount expensed is recognized over the vesting

period, which is the period over which all the specified vesting

conditions are to be satisfied.

The fair value of the stock option plan is measured at the grant

date using the Black-Scholes valuation model which takes into

account the expected life and cancellation rate of the options.

At each statement of financial position date, the entity revises

its estimates of the number of options that are expected to vest.

It recognises the impact of the revision to original estimates,

if any, in the income statement, with a corresponding

adjustment to equity.

The proceeds received net of any directly attributable

transaction costs are credited to share capital (nominal value)

and share premium when the options are exercised. The

fair value of the amount payable to employees in respect

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of share appreciation rights, phantom share option, share

award and performance share plans, which are settled in

cash, is recognized as an expense, with a corresponding

increase in liabilities, over the period that the employees

become unconditionally entitled to payment. The liability is

re-measured at each statement of financial position date and at

settlement date.

Any changes in the fair value of the liability are recognized as

personnel expenses in the income statement.

3.28 Provisions

Provisions are recognized in the statement of

financial position when:

• there is a present obligation (legal or constructive) as a result

of a past event;

• it is probable that an outflow of resources embodying

economic benefits will be required to settle the obligation; and

• a reliable estimate can be made of the amount of the obligation.

The amount recognized as a provision is the best estimate of

the expenditure required to settle the present obligation at the

statement of financial position date. Provisions are measured at

the present value of the expenditures expected to be required

to settle the obligation using a discount rate that reflects

current market assessments of the time value of money and

the risks specific to the obligation. The increase in the provision

due to the passage of time is recognized as interest expense.

A restructuring provision is recognized when the Group has a

detailed formal plan and has raised a valid expectation in those

affected that it will carry out the restructuring by starting to

implement that plan or announcing its main features to those

affected by it.

Environmental provisions are mainly resulting from legal

contractual obligations. For more information about these

environmental and other provisions we refer to Note 34.

228 229

4. Critical judgements and accounting estimates

Estimates and judgements are continuously evaluated and are

based on historical experience and other factors, including

expectations of future events that are believed to be reasonable

under the circumstances.

4.1 Critical judgements in applying the group

accounting policies

Revenue recognition

The Group is party to out-licensing agreements, which can

involve upfront payments, development milestones, sales

milestones and royalties that may occur over several years

and involve certain future contract liabilities. For all out-

licensing agreements whereby a license is transferred with

other goods or services, the Group first makes an assessment

about whether or not the license is to be considered as a

distinct performance obligation or not. If the transfer of the

license is considered to be a separate performance obligation,

revenue relating to the transfer of the license is recognized

at a point in time or over time depending on the nature of

the license. Revenues are only recognized over time if the

Group is performing development, manufacturing or other

activities that could significantly affect the IP transferred,

hereby exposing the licensee to the effects of these activities

when these activities do not represent a separate service. If the

Group assesses that these conditions are not fulfilled, revenue

resulting from out-licensing agreements is recognized at the

moment control over the license is transferred.

If revenues are recognized over time and in case the input

method is assessed as the best method to reflect the transfer of

control of the service to the customer, some judgement may

be required in applying this method especially in estimating

the total costs and hours to be incurred. In this case the

Group uses its best estimate based on past experience and

actual knowledge and progress of the service to be provided.

Estimates are reassessed on a continuous basis. Seen the

activities of the Group, in most cases, the input method

provides the most faithful depiction of the transfer of the

service to the customer.

For licenses that are bundled with other services (e.g.

development or manufacturing services) the Group will apply

judgment to assess whether the combined performance

obligation is satisfied at a point in time or over time. If revenue

is recognized over time, the Group will apply judgment

in determining the period over which the services are

provided. The Group will also apply judgment when allocating

the components of the transaction price to the different

performance obligations in case the out-licensing agreement

includes other performance obligations in addition to the

transfer of the license.

Revenue recognition for out-licensing agreements is therefore

based on the specific conditions of each out-licensing

agreement. This might result in cash receipts being initially

recognized as contract liabilities and then released to revenue

in subsequent accounting periods based on the different

conditions specified in the agreement.

Discontinued operations

Operations that are classified as held for sale or have been

disposed of, are presented as discontinued operations in

the consolidated income statement when the operations

represent a major separate line of business or geographical

area of operations, are part of a single coordinated disposal

plan or represent a subsidiary acquired exclusively with a view

to resale. The assessment on what is a major separate line

of business is done on a case by case basis and depends on

the size of the operations in terms of revenues, gross profit

or total value of assets and liabilities compared to the total

operations of the Group.

Leases

In determining the lease term, management considers all

facts and circumstances that create an economic incentive to

exercise an extension or termination option. The assessment

is reviewed if a significant event or a significant change in

circumstances occurs which affects this assessment. During

the current financial year, there was no material financial

effect of revising lease terms to reflect the effect of exercising

extension or termination options.

4.2 Critical accounting estimates and assumptions

The preparation of the financial statements in conformity

with IFRS as adopted for use by the European Union requires

management to make estimates and assumptions that affect

the reported amounts of assets and liabilities and disclosure

of contingent assets and liabilities at the date of the financial

statements and the reported amounts of revenue and

expenses during the reporting period.

Management bases its estimates on historical experience

and various other assumptions that are reasonable under

the circumstances, the results of which form the basis for

making the reported amounts of revenue and expenses

that may not be readily apparent from other sources. Actual

results will by definition not equal those estimates. Estimates

and assumptions are reviewed periodically and the effects of

revisions are reflected in the financial statements in the period

they are determined to be necessary.

4.2.1 Sales allowances

The Group has accruals for expected sales returns,

chargebacks and other rebates, including the U.S. Medicaid

Drug Rebate program and the U.S. Federal Medicare program,

and similar rebates in other countries. Such estimates are based

on analyses of existing contractual obligations or legislation,

historical trends and the Group experience. After assessment

of the Management, the total accruals for these items are

adequate, based upon currently available information and

interpretation of relevant regulations. As these deductions are

based on management estimates, the actual deductions might

differ from these estimates.

Such differences could impact the accruals recognized in

the statement of the financial position in future periods and

consequently the level of sales recognized in the income

statement in future period, as there is often a time lag of

several months between the recording of the estimate and

the final accounting of the sales allowances. In general, the

discounts, rebates and other deductions shown on the invoice

are accounted for as an immediate deduction from gross

sales in the income statement. The sales returns, chargebacks,

rebates and discounts that are not mentioned on the invoice

are estimated, deducted from sales and presented on the

statement of the financial position in the appropriate accrual

account and deducted from sales.

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All sales allowances are considered as being part of the variable

consideration included in the transaction price. The amount

of variable consideration included in the transaction price

is determined so that the total transaction price is the price

estimated by management as not being constrained.

4.2.2 Intangible assets and goodwill

The Group has intangible assets with a carrying amount of

€ 4 816 million (Note 20) and goodwill with a carrying amount

of € 5 340 million (Note 21). Intangible assets are amortized

over their useful lives on a straight-line basis as from the

moment they are available for use (i.e. when related products

are launched for sale).

Management estimates that the useful life for acquired

in-progress R&D compounds equates to the period these

compounds benefit from patent protection or data exclusivity.

For the intangible assets acquired through a business

combination and which comprises compounds that are

marketed but for which no patent protection or data exclusivity

exists, management estimates that the useful life equates to

the period in which these compounds will realize substantially

all the cash contributions.

These intangible assets and goodwill are regularly reviewed

for impairment and whenever there is an indication that an

impairment might exist. The intangible assets that are not yet

available for use and goodwill are subject to at least annual

impairment testing.

To assess if there is any impairment, estimates are made of

the future cash flows expected to result from the use of these

assets and their eventual disposal. These estimated cash flows

are then adjusted to the present value using an appropriate

discount rate that reflects the risks and uncertainties associated

with the forecasted cash flows.

Actual outcomes could vary significantly from such estimates

of discounted future cash flows. Factors such as the entrance

or absence of competition, technical obsolescence or lower

than expected rights could result in shortened useful lives

and impairments.

The Group applied the following key assumptions for the “value

in use” calculations required for the impairment testing of

intangible assets and goodwill at year-end:

Growth rate for terminal value

2.0%

Discount rate in respect of goodwill and

Intangibles related to marketed products

6.64%

Since the cash flows also take into account tax expenses, a

post-tax discount rate is used in the impairment testing.

Management estimates that the use of the post-tax discount

rate approximates the results of using a pre-tax rate applied to

pre-tax cash flows.

4.2.3 Environmental provisions

The Group has provisions for environmental remediation costs,

which are disclosed in Note 34. The most significant elements

of the environmental provisions consist of costs to fully clean

and refurbish contaminated sites and to treat contamination at

certain other sites, mainly related to the discontinued chemical

and films activities of the Group.

Future remediation expenses are affected by a number of

uncertainties that include, amongst others, the detection of

previously unknown contaminated sites, the method and

extent of remediation, the percentage of waste attributable to

the Group, and the financial capabilities of the other potentially

responsible parties. Given the inherent difficulties in estimating

the liabilities in this area, it cannot be guaranteed that additional

costs will not be incurred beyond the amounts currently

accrued. The effect of resolution of environmental matters on

results of operations cannot be predicted due to uncertainty

concerning both the amount and timing of future expenditures

and the results of future operations. Such changes that arise

could impact the provisions recognized in the statement of the

financial position in the future.

4.2.4 Employee benefits

The Group currently has many defined benefit plans, which are

disclosed in Note 33. The calculation of the assets or liabilities

related to these plans is based upon statistical and actuarial

assumptions. This is in particular the case for the present

value of the defined benefit obligation which is impacted by

assumptions on discount rates used to arrive at the present

value of future pension liabilities, and assumptions on future

increases in salaries and benefits.

Furthermore, the Group uses statistically-based assumptions

covering areas such as future withdrawals of participants

from the plans and estimates of life expectancy. The actuarial

assumptions used might differ materially from actual results

due to changes in market and economic conditions, higher

or lower employee turnover, longer or shorter life spans of

participants, and other changes in the factors being assessed.

These differences could impact the assets or liabilities

recognized in the statement of financial position in

future periods.

4.2.5 Tax positions

The Group operates in multiple jurisdictions with often

complex legal and tax regulatory environments. The Group

engages constructively with the tax authorities. Where

appropriate, we engage advisors and legal counsel to obtain

opinions on tax legislation and principles. The income

tax positions taken are considered by the Group to be

supportable and are intended to withstand challenge from

tax authorities. However, it is acknowledged that some of

the positions are uncertain and include interpretations of

complex tax laws as well as transfer pricing considerations

which could be disputed by tax authorities. The Group judges

these positions on their technical merits and this on a regular

basis using all the information available (legislation, case law,

regulations, established practice, authoritative doctrine as

well as the current state of discussions with tax authorities,

where appropriate).

A liability is recorded for each item that is not probable of being

sustained on examination by the tax authorities and after using

all legal remedies of defending the position before Court,

based on all relevant information. The liability is calculated

taking into account the most likely outcome for corporate

income tax related matters or the expected value for corporate

income tax and transfer pricing matters, depending on which

is thought to give a better prediction of the resolution of each

uncertain tax position in view of reflecting the likelihood of

an adjustment being recognized upon examination. These

230 231

estimates are based on facts and circumstances existing at the

end of the reporting period. The tax liability and income tax

expense include expected penalties and late payment interests

arising from tax disputes.

An asset for tax audit adjustments is recorded when the Group

considers it probable, based on the technical merits of the

tax case, that a Mutual Agreement or Arbitration Procedure

may provide for relief in one or more jurisdictions. The asset is

calculated as the expected value (as relating to transfer pricing

matters) of the recoverability in corporate income taxes in

the concerning jurisdiction upon completion of the Mutual

Agreement or Arbitration procedure.

The Group has recognized net deferred tax assets of

€ 379 million (Note 32). The recognition of deferred tax assets

is based upon whether it is probable that sufficient taxable

profits will be available in the future against which the reversal

of temporary differences can be used. Where the temporary

differences relate to losses or carry-forward tax attributes (such

as innovation income deduction), the availability of sufficient

forecasted taxable profits to offset against the tax attributes

is also considered, taking into account the function and risk

profile of the taxable entity concerned.

Significant items on which management has exercised

judgement include recognition on the statement of financial

position of deferred tax assets relating to losses in jurisdictions

where losses have been made in prior periods but where

profits now arise or are forecast to do so for the foreseeable

future. Management has used its best estimate of the correct

value of asset to recognize in such cases, which includes a

judgment on the length of the future time period to use in such

assessments. These judgments are made on a case by case

basis taking into account the origin and nature of the expected

revenues, based on the functional profiles of the concerning

entities and on an entity-by-entity basis, but this time period in

most cases does not exceed five years.

Differences in forecasted taxable profits and actual profitability

or a downgrade in future forecasted taxable profits could

impact the deferred tax assets recognized in future periods.

No material deferred tax assets are recognized for entities that

are currently still lossmaking or not using their tax attributes.

Given the international tax reform developments, Management

is assessing the impact of the pending international OECD tax

reform (‘Tax Challenges arising from the Digitalization of the

Economy’) on recognition & measurement of deferred tax

assets. Given lack of enactment in the countries where UCB

operates, this currently does not generate any impact.

4.2.6 Valuation of intangibles and related deferred taxes

acquired in business combination

Assets that have been identified as a result of a business

combination are valued incorporating the concept of

highest and best use in accordance with IFRS 13, Fair Value

Measurement and IFRS 3, Business Combinations from the

viewpoint of a market participant.

In order to value the existing In-Process Research &

Development (IPR&D) assets as of the effective date of the

business combination, the multi-period excess earnings

method is used which is a variation of the income approach

that estimates an intangible asset’s value based on the present

value of the incremental after-tax cash flows (or “excess

earnings”) attributable only to the intangible asset. As a basis

for this valuation, management-prepared prospective financial

information is used for the prospective earnings associated

with the IPR&D. Specifically, this prospective financial

information relates to revenues, cost of goods sold, R&D

expenses, distribution, sales and marketing expenses, general

and administrative costs and Probability of Technical and

Regulatory Success (PTRS) specific to the IPR&D assets. The

determination of these PTRS is based on benchmarks and

internal analysis.

Other assumptions relate to income tax rate and tax

amortization benefit, useful life and discount rate. The fair value

of the IPR&D assets is considered amortizable for income

tax purposes from the viewpoint of a market participant. The

present value of the tax benefit from amortization of the assets

is added to the present value of the incremental after-tax cash

flows to arrive at the indicated value of the IPR&D assets. The

magnitude of the discount rate applied to the projected cash

flows is related to the current capital costs. The discount

rate utilized represents an estimate of the Weighted Average

Cost of Capital.

All prospective financial information, PTRS and other

assumptions are assessed on a case by case basis taking into

account all specific circumstances. Actual outcomes could

vary significantly from such assumptions and could impact

the value of the intangibles and related deferred taxes in future

periods. An impairment test is performed at least once a year

and whenever there is an indication that an impairment might

exist. See also Note 4.2.2 Intangible assets and goodwill.

4.2.7 Assessment of control over an investment in case more

than 50% of the shares are held by non-controlling interests.

In order to assess whether or not UCB has control over an

investment in case more than 50% of the shares are held

by non-controlling interests, any contractual arrangement

between UCB and the investment is considered as well as the

design and the purpose of investment, the power to direct the

relevant activities of the investment, the contractual sharing

of risk as well as the power of UCB compared to the non-

controlling interests to affect the returns of the investment.

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5. Financial risk management

The Group is exposed to various financial risks arising from its

underlying operations and corporate finance activities.

These financial risks mainly include market risk (including

currency risk, interest risk and price risk), credit risk and

liquidity risk.

This note presents information about the Group’s exposure and

management of the above-mentioned risks and the Group’s

management of capital.

5.1 Market risk

Market risk is the risk that changes in market prices, such as

foreign exchange rates, interest rates and equity prices will

affect the Group income statement or the value of its assets

and liabilities. The objective of market risk management is

to manage and control market risk exposures. The Group

enters into derivative financial instruments and also incurs

financial liabilities or holds financial assets in order to manage

market risk. Where possible, the Group seeks to apply hedge

accounting in order to manage volatility in the income

statement. It is the Group policy and practice not to enter into

derivative transactions for speculative purposes.

5.1.1 Foreign exchange risk

The Group operates across the world and is exposed to

movements in foreign currencies affecting its net income and

financial position, as expressed in euro. The Group actively

monitors its currency exposures, and when appropriate,

enters into transactions with the aim of preserving the value of

existing assets and liabilities, as well as anticipated transactions.

The Group uses forward contracts, foreign exchange options

and cross-currency swaps to hedge certain committed and

anticipated foreign exchange flows and financing transactions.

The instruments purchased to hedge transactional exposure

are primarily denominated in U.S. Dollar, British Pound,

Japanese Yen and Swiss Franc, the currencies where the

Group has its most important exposures. The Group’s financial

risk management policy is to hedge for the impact from the

translation of foreign currency assets and liabilities into the

functional currency of the relevant group subsidiaries, as

well as the impact of currency fluctuations on the Group’s

anticipated net foreign currency cash flows for a period of

minimum 6 and maximum 26 months.

The Group has certain investments in foreign operations,

whose net assets are exposed to foreign currency

translation risk.

The effect of translational exposure arising from the

consolidation of the foreign currency denominated financial

statements of the Group foreign subsidiaries as well as

from assimilated net foreign investment positions and net

investment hedges is shown as a cumulative translation

adjustment in the Group consolidated statement of

changes in equity.

5.1.2 Effect of currency fluctuations

At December 31, 2022, if the euro had strengthened or

weakened by 10% against the following currencies with all

other variables being held constant, the impact on equity and

post-tax profit for the year, based on the outstanding currency

balances and hedge instruments at that date, would have

been as follows:

At December 31, 2022

€ million

Change in rate.Strengthening/

weakening (-) EUR

Impact on equity:

Loss (-)/gain

Impact on income

statement: Loss (-)/gain

USD

+ 10% 93 8

- 10% - 114 - 10

GBP

+ 10% 2 0

- 10% - 2 0

CHF

+ 10% - 70 1

- 10% 86 - 1

JPY

+ 10% 5 1

- 10% - 6 - 1

232 233

At December 31, 2021

€ million

Change in rate. Strengthening/

weakening (-) EUR

Impact on equity:

Loss (-)/gain

Impact on income

statement: Loss (-)/gain

USD

+ 10% 111 7

- 10% - 136 - 9

GBP

+ 10% - 9 2

- 10% 11 - 3

CHF

+ 10% - 73 5

- 10% 89 - 6

JPY

+ 10% 24 0

- 10% - 29 - 1

Investments in equities, bonds, debentures and other fixed

income instruments are entered into on the basis of guidelines

with regard to liquidity and credit rating.

Amounts subject to market price risk are rather immaterial

and therefore the impact on equity or the income statement

of a reasonable change of this market price risk is assumed

to be negligible.

Similar to 2021, during 2022 the Group traded on treasury

shares, which were accounted for through equity.

5.2 Credit risk

Credit risk arises from the possibility that the counterparty to a

transaction may be unable or unwilling to meet its obligations

causing a financial loss to the Group. Trade receivables are

subject to a policy of active risk management, which focuses

on the assessment of country risk, credit availability, on-

going credit evaluation and account monitoring procedures.

There are certain concentrations within trade receivables of

counterparty credit risk, particularly in the U.S., due to the sales

via wholesalers (Note 25).

For some credit exposures in critical countries, such as

International Markets and Southern European countries, the

Group has obtained credit insurance.

In the U.S., the Group entered into a trade receivable financing

agreement that qualifies for derecognition. According to the

terms and conditions of the agreement UCB does not retain

any non-payment or further late payment risk relating to the

transferred trade receivables.

The exposure of other financial assets to credit risk is controlled

by setting a policy for limiting credit exposure to high quality

counterparties, regular reviews of credit ratings, and setting

defined limits for each individual counterparty. The criteria set

by Group Treasury for their investment policy are based on

generally considered high quality long-term credit ratings and 5

years Credit Default Swap rate.

Where appropriate to reduce exposure, netting agreements

under an ISDA (International Swaps and Derivatives

Association) master agreement are signed with the respective

counterparties. The maximum exposure to credit risk

resulting from financial activities, without considering netting

agreements, is equal to the carrying amount of financial assets

plus the positive fair value of derivative instruments.

5.1.3 Interest rate risk

Changes in interest rates may cause variations in interest

income and expenses resulting from interest-bearing assets

and liabilities. In addition, they can affect the market value of

certain financial assets, liabilities and instruments as described

in the following section on market risk of financial assets. The

interest rates on the Group’s major debt instruments are both

fixed and floating, as described in Notes 29 and 30. The Group

uses interest rate derivatives to manage its interest rate risk, as

described in Note 39.

The Group designates derivative financial instruments (interest

rate swaps) as hedging instruments, under fair value hedges,

to fixed rate financial assets and liabilities. Both the derivative

financial instrument and the hedged item are accounted for at

fair value through profit or loss.

In 2022, changes in fair value resulting from interest rate

derivatives designated to the floating rate liabilities of the Group

have been accounted for through equity under IFRS 9.

5.1.4 Effect of interest rate fluctuations

A 100 basis points increase in interest rates at statement

of financial position date would have increased equity by

€ 29 million (2021: € 5 million); a 100 basis points decrease

in interest rates would have decreased equity by € 31 million

(2021: € 5 million).

A 100 basis points increase or decrease in interest rates at

statement of financial position date would have no impact on

profit and loss (2021: € 0 million).

All interest rate hedges are either designated as cash flow

hedges or fair value hedges under IFRS9 and therefore, except

for minimal hedge inefficiency, the result of a change in the

interest rate curve is accounted for through equity, respectively

offset by the revaluation through P&L of the hedged item.

These concern all pre-tax calculations.

5.1.5 Other market price risk

Changes in the market value of certain financial assets and

derivative financial instruments can affect the income or the

financial position of the Group. Financial long-term assets,

if any, are held for contractual purposes, and marketable

securities, if any, are mainly held for regulatory purposes. The

risk of loss in value is managed by reviews prior to investing and

continuous monitoring of the performance of investments and

changes in their risk profile.

234 235

UCB | Integrated Annual Report 2022

5.3 Liquidity risk

Liquidity risk is the risk that the Group will not be able to meet

its financial obligations as they fall due. The Group’s approach

to managing liquidity is to ensure, as far as possible, that it will

always have sufficient liquidity to meet its liabilities when due,

under normal circumstances without incurring unacceptable

losses or risking damage to the Group reputation.

The Group maintains sufficient reserves of cash and

readily realisable marketable securities to meet its liquidity

requirements at all times. In addition, the Group has certain

unutilized committed revolving and loan facilities at its disposal.

At the statement of financial position date, the Group had the

following sources of liquidity available:

• cash and cash equivalents (Note 26): € 899 million (2021:

€ 1 263 million)

• unutilized credit facilities and undrawn available amount under

finance contract (Note 29): € 30 million (2021: € 38 million),

linear digressive since 2016 until 2025

• unutilized revolving credit facilities (Note 29): € 1 billion (2021:

€ 1 billion); the existing € 1 billion syndicated committed

revolving credit facility of the Group, maturing in 2025 was

undrawn per end 2022

• bilateral bullet loan agreement (Note 29): € 350 million (2021:

€ 350 million) under a loan agreement with availability period

until November 2023 and with maximum tenor of 8 years as

from the date of drawing

The table below analyses the contractual maturities of the

Group financial liabilities into relevant maturity groupings

based on the remaining period at the statement of financial

position date to the contractual maturity date, excluding the

impact of netting. The amounts mentioned below with respect

to the financial derivatives are indicative of the contractual

undiscounted cash flows. The amounts with respect to

borrowings are indicative of the contractual undiscounted

cash flows, including interests calculated based on fixed rate

agreements or, in absence thereof, last available fixing of the

relevant reference rate.

At December 31, 2022

€ million Note

Balance

Sheet Total

Contractual

cash flow

(including

interests)

Less than

1 year

Between 1

and 2 years

Between 2

5 years

Over 5

years

Bank Borrowings and other long term loans 

1 987 2 337 101 102 2 003 131

Debentures and other short term loans 

9 9 9 0 0 0

Lease liabilities 

141 152 42 28 42 40

Institutional Eurobond maturing in 2028 

420 535 5 5 15 510

Private Placement maturing in 2027 

129 161 2 2 5 152

Retail bond maturing in 2023 

174 185 185 0 0 0

Trade and other liabilities 

2 611 2 611 2 492 5 81 33

Bank overdrafts 

40 40 40 0 0 0

Interest rate swaps

- 38 - 38 9 - 5 - 35 - 7

Forward exchange contracts and other derivative

financial instruments used for hedging purposes

Outflow

4 696 4 696 0 0 0

Inflow

4 641 4 641 0 0 0

Forward exchange contracts and other derivative

financial instruments at fair value through profit and loss

Outflow

3 399 3 399 0 0 0

Inflow

3 436 3 436 0 0 0

234 235

At December 31, 2021

€ million Note

Balance

Sheet

Total

Contractual

cash flow

(including

interests)

Less than

1 year

Between 1

and 2 years

Between 2

and 5 years

Over 5

years

Bank Borrowings and other long term loans 

1 152 1 152 - 1 - 2 1 155 0

Debentures and other short term loans 

0 0 0 0 0 0

Lease liabilities 

136 145 38 28 33 46

Institutional Eurobond maturing in 2028 

487 535 5 5 15 510

Private Placement maturing in 2027 

147 161 2 2 5 152

Retail bond maturing in 2023 

182 194 9 185 0 0

Trade and other liabilities 

2 641 2 641 2 555 8 73 5

Bank overdrafts 

20 20 20 0 0 0

Interest rate swaps

20 20 6 6 6 2

Forward exchange contracts and other derivative

financial instruments used for hedging purposes

Outflow

4 152 4 152 0 0 0

Inflow

4 066 4 066 0 0 0

Forward exchange contracts and other derivative

financial instruments at fair value through profit and loss

Outflow

1 207 1 207 0 0 0

Inflow

1 247 1 247 0 0 0

5.4 Capital risk management

The Group policy with respect to managing capital is to

safeguard the Group’s ability to continue as a going concern

in order to provide returns to shareholders and benefits to

patients and to reduce the Group external debt further, in

order to obtain a capital structure that is consistent with others

in the industry.

€ million Note 2022 2021

Total borrowings 

2 177 1 307

Bonds 

723 816

Less: cash and cash equivalents, available for sale debt securities and cash

collateral related to the financial lease obligation

, 

- 899 - 1 263

Net debt

2 000 860

Total equity

9 064 8 386

Total financial capital

11 065 9 246

Gearing ratio

18% 9%

236 237

UCB | Integrated Annual Report 2022

5.5 Fair value estimation

The fair value of financial instruments traded in active

markets (such as financial assets at fair value through OCI)

is based on quoted market prices at the statement of

financial position date.

The fair value of financial instruments that are not traded in

an active market is determined by using established valuation

techniques such as option pricing models and estimated

discounted values of cash flows. The Group uses a variety of

methods and makes assumptions that are based on market

conditions and the credit and the non-performance risks

existing at each statement of financial position date.

Quoted market prices are used for long-term debt. Other

techniques, such as estimated discounted cash flows, are used

to determine fair value for the remaining financial instruments.

The fair value of the interest rate swaps is calculated as the

present value of the estimated future cash flows. The fair

value of the forward exchange contract is determined using

discounted value of the exchanged amounts in currencies,

converted at the prevailing spot rate at the statement of

financial position date.

The carrying amount less impairment provision of trade

receivables and trade payables is assumed to approximate their

fair values. The fair value of financial liabilities for disclosure

purposes is estimated by discounting the future contractual

cash flows at the current market interest rates that is available

to the Group for similar financial instruments.

5.5.1 Fair value hierarchy

IFRS 7 requires disclosure of fair value measurements by level

of the following hierarchy:

• Level 1: quoted (unadjusted) prices in active markets for

identical assets or liabilities;

• Level 2: other techniques for which all inputs which have a

significant effect on the recorded fair value are observable,

either directly or indirectly;

• Level 3: techniques which use inputs which have a significant

effect on the recorded fair value that are not based on

observable market data.

All fair value measurements disclosed are recurring.

5.5.2 Financial assets measured at fair value

December 31, 2022

€ million Note Level 1 Level 2 Level 3 Total

Financial assets

Financial assets at FVOCI 

Quoted equity securities

180 0 0 180

Quoted debt securities

0 0 0 0

Derivative financial assets 

Forward foreign exchange contracts – cash flow hedges

0 31 0 31

Forward exchange contracts – fair value through profit and loss

0 25 0 25

Forward exchange contracts – net investment hedges

0 54 0 54

Interest rate derivatives – cash flow hedges

0 38 0 38

Interest rate derivatives – fair value through profit and loss

0 4 0 4

Other financial assets excluding derivatives 

236 237

December 31, 2021

€ million Note Level 1 Level 2 Level 3 Total

Financial assets

Financial assets at FVOCI 

Quoted equity securities

179 0 0 179

Quoted debt securities

0 0 0 0

Derivative financial assets 

Forward foreign exchange contracts – cash flow hedges

0 11 0 11

Forward exchange contracts – fair value through profit and loss

0 13 0 13

Forward exchange contracts – net investment hedges

0 37 0 37

Interest rate derivatives – cash flow hedges

0 1 0 1

Interest rate derivatives – fair value through profit and loss

0 8 0 8

Other financial assets excluding derivatives 

5.5.3 Financial liabilities measured at fair value

December 31, 2022

€ million Note Level 1 Level 2 Level 3 Total

Financial liabilities

Derivative financial liabilities 

Forward foreign exchange contracts – cash flow hedges

0 36 0 36

Forward exchange contracts – fair value through profit and loss

0 60 0 60

Forward exchange contracts – net investment hedges

0 26 0 26

Interest rate derivatives – cash flow hedges

0 2 0 2

Interest rate derivatives – fair value through profit and loss

0 93 0 93

Other financial liabilities excluding derivatives 

December 31, 2021

€ million Note Level 1 Level 2 Level 3 Total

Financial liabilities

Derivative financial liabilities 

Forward foreign exchange contracts – cash flow hedges

0 69 0 69

Forward exchange contracts – fair value through profit and loss

0 29 0 29

Forward exchange contracts – net investment hedges

0 0 0 0

Interest rate derivatives – cash flow hedges

0 0 0 0

Interest rate derivatives – fair value through profit and loss

0 12 0 12

Other financial liabilities excluding derivatives 

238 239

UCB | Integrated Annual Report 2022

December 31, 2021

Related amounts not set off

in the statement of financial position

€ million

Gross financial assets

in the statement of

financial position

Financial

instruments

Cash collateral

received Net amounts

Derivatives

71 47 0 24

Other

0 0 0 0

Total

71 47 0 24

During the reporting period ending December 31, 2022,

there were no transfers between Level 1 and Level 2 fair value

measurements, and no transfers into and out of Level 3 fair

value measurements.

Fair value measurements categorized within Level 2 of the fair

value hierarchy are calculated using either the “Discounted

cash flow” or the “Black-Scholes” method (for FX options only)

and market data publicly available.

5.6 Offsetting financial assets and financial liabilities

While the Group has amounts subject to an enforceable master

netting arrangement or similar agreements, financial assets

and financial liabilities are reported gross on the statement of

financial position as the requirements are not met to report

them net. The reconciliations below depict the amounts

subject to an enforceable master netting arrangement or

similar agreement that have not been netted on the statement

of financial position.

The tables below show financial assets and liabilities subject to

enforceable master netting arrangements:

December 31, 2022

Related amounts not set off in

the statement of financial position

€ million

Gross financial assets

in the statement of

financial position

Financial

instruments

Cash collateral

received

Net amounts

Derivatives

152 121 0 31

Other

0 0 0 0

Total

152 121 0 31

December 31, 2022

Related amounts not set off

in the statement of financial position

€ million

Gross financial liabilities

in the statement of

financial position

Financial

instruments

Cash collateral

received

Net amounts

Derivatives

217 121 0 96

Other

0 0 0 0

Total

217 121 0 96

ISDA master agreements (International Swaps and

Derivatives Association) have been signed with the respective

counterparties allowing offsetting of financial assets and

liabilities. This is applicable to the fair value settlement in

case of default, but it is not applicable at the closing date

December 31, 2022.

The tables below show financial assets and liabilities subject to

enforceable master netting arrangements:

238 239

December 31, 2021

Related amounts not set off

in the statement of financial position

€ million

Gross financial liabilities

in the statement of

financial position

Financial

instruments

Cash collateral

received Net amounts

Derivatives

111 47 0 64

Other

0 0 0 0

Total

111 47 0 64

6. Segment reporting

The Group’s activities are in one segment,

Biopharmaceuticals.

There are no other significant classes of business, either

singularly or in aggregate. The Chief Operating Decision

Makers,

that being the Executive Committee, review the operating

results and operating plans, and make resource allocation

decisions on a company-wide basis, therefore UCB operates

as one segment.

Enterprise-wide disclosures about product sales,

geographic areas and revenues from major customers are

presented below.

6.1 Product sales information

Net sales consist of the following:

€ million 2022 2021

CIMZIA

2 085 1 841

VIMPAT

1 124 1 549

KEPPRA

** (including KEPPRA

** XR / E KEPPRA

**)

729 970

BRIVIACT

485 355

NEUPRO

305 307

FINTEPLA

116 0

NAYZILAM

78 57

BIMZELX

35 4

EVENITY

25 10

Other products

325 321

Designated hedges reclassified to net sales

- 167 57

Total net sales

5 140 5 471

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

240 241

UCB | Integrated Annual Report 2022

6.2 Geographic information

The table below shows net sales in each geographic market in which customers are located:

€ million 2022 2021

U.S.

2 902 2 888

Europe – other

348 331

Germany

330 335

Japan

324 561

Spain

213 202

France (including French territories)

169 172

China

159 140

Italy

154 159

U.K. and Ireland

151 150

Belgium

49 47

Other countries

507 429

Designated hedges reclassified to net sales

- 167 57

Total net sales

5 140 5 471

The table below illustrates the property, plant and equipment in each geographic market in which the assets are located:

€ million 2022 2021

Belgium

771 609

Switzerland

251 259

U.K. and Ireland

181 184

U.S.

151 131

Japan

19 25

China

20 23

Germany

20 21

Other countries

21 23

Total

1 434 1 275

6.3 Information about major customers

UCB has 3 customers which individually account for more than

10% of the total net sales for 2022 and 2021:

• Mckesson, U.S. for which net sales 2022 amount to

€ 977 million (19% of total net sales) (2021: € 890 million,

16% of net sales)

• Cardinal Health, U.S. for which net sales 2022 amount to

€ 680 million (13% of total net sales) (2021: € 753 million,

14% of net sales)

• Amerisourcebergen Corp, U.S. for which net sales 2022

amount to € 509 million (10% of total net sales) (2021:

€ 660 million, 12% of net sales)

7. Revenue from contracts with customers

The Group has recognized the following amounts relating to revenue in the consolidated income statement:

€ million 2022 2021

Revenue from contracts with customers

5 486 5 748

Revenue from agreements whereby risks and rewards are shared

31 29

Total revenue

5 517 5 777

240 241

7.1 Disaggregation of revenue from contracts with customers

Actual Timing of revenue recognition

2022 2021

€ million

At a point

in time Over time

At a point

in time Over time

Net sales U.S.

2 902 2 888 2 902 0 2 888 0

CIMZIA

1 381 1 183 1 381 0 1 183 0

VIMPAT

706 1 130 706 0 1 130 0

BRIVIACT

380 267 380 0 267 0

KEPPRA

156 156 156 0 156 0

FINTEPLA

107 0 107 0 0 0

NEUPRO

94 95 94 0 95 0

NAYZILAM

78 57 78 0 57 0

Net sales Europe

1 414 1 396 1 414 0 1 396 0

CIMZIA

416 420 416 0 420 0

VIMPAT

272 294 272 0 294 0

KEPPRA

206 218 206 0 218 0

NEUPRO

163 167 163 0 167 0

BRIVIACT

88 77 88 0 77 0

BIMZELX

29 4 29 0 4 0

EVENITY

25 10 25 0 10 0

FINTEPLA

8 0 8 0 0 0

Established brands / Other products

207 206 207 0 206 0

Net sales Japan

324 562 324 0 562 0

KEPPRA

149 404 149 0 404 0

VIMPAT

68 62 68 0 62 0

CIMZIA

51 44 51 0 44 0

NEUPRO

27 26 27 0 26 0

BIMZELX

4 0 4 0 0 0

FINTEPLA

1 0 1 0 0 0

Established brands / Other products

24 25 24 0 25 0

Net sales international markets

667 568 667 0 568 0

CIMZIA

237 193 237 0 193 0

KEPPRA

217 193 217 0 193 0

VIMPAT

77 62 77 0 62 0

NEUPRO

22 19 22 0 19 0

BRIVIACT

17 11 17 0 11 0

BIMZELX

2 0 2 0 0 0

Established brands / Other products

94 90 94 0 90 0

Net sales before hedging

5 307 5 414 5 307 0 5 414 0

Designated hedges reclassified

to net sales

- 167 57 - 167 0 57 0

otal net sales

5 140 5 471 5 140 0 5 471 0

Royalty income and fees

85 79 85 0 79 0

Contract manufacturing revenues

103 128 103 0 128 0

Income from licensing deals

(upfront payments, development

milestones, sales milestones)

150 60 104 46 44 16

evenue resulting from services

& other deliveries

8 10 8 0 5 5

otal other revenue

261 198 215 46 177 21

Total revenue from contracts with

customers

5 486 5 748 5 440 46 5 727 21

242 243

UCB | Integrated Annual Report 2022

7.2 Contract assets and liabilities

The group has recognized the following revenue-related contract liabilities:

€ million Note 2022 2021

Contract liabilities resulting from out-licensing agreements

Non-current 

0 0

Current 

183 221

Contract liabilities resulting from other agreements

1 2

Total revenue-related contract liabilities

184 223

The Group does not have any revenue-related contract assets.

Revenue-related contract liabilities mainly relate to unsatisfied

performance obligations resulting from out-licensing

agreements with Otsuka, Genentech and Novartis (see below).

These liabilities have decreased because of the recognition

of revenue during the year resulting from performance

obligations that were satisfied in 2022.

The following table shows how much of the revenue

recognized in the current reporting period was included in

the contract liability balance at the beginning of the period

and how much relates to performance obligations that were

satisfied in previous periods.

€ million

2022 2021

Revenue recognized that was included in the contract liability balance

at the beginning of the period

41 18

Revenue resulting from other agreements

0 2

Revenue resulting from out-licensing agreements

41 16

Revenue recognized that relates to performance obligations that were satisfied in a prior year

121 131

Product sales

0 50

Revenue resulting from out-licensing agreements

121 81

The following table shows unsatisfied performance obligations resulting from out-licensing agreements:

€ million Note 2022 2021

Aggregate amount of the transaction price allocated to development agreements that

are partially or fully unsatisfied as at December 31



183 221

Unsatisfied performance obligations resulting from out-licensing agreements

183 221

Management expects that 19% of the transaction price

allocated to the unsatisfied development agreements as of

December 31, 2022 will be recognized as revenue during

the next reporting period. 20% is assessed to be recognized

during 2024 and the remaining 61% will be recognized in

financial years 2025 till 2031. The amount disclosed above

does not include variable consideration which is constrained.

The performance obligations still to be satisfied concern

development activities to be performed over the next years.

All other development, manufacturing or other service

agreements are for periods of one year or less or are billed

based on time incurred. As permitted under IFRS 15, the

transaction price allocated to these unsatisfied agreements

is not disclosed.

No assets are recognized from costs to fulfill a contract.

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

242 243

8. Business combinations

Acquisition of Zogenix, Inc.

On March 7, 2022, UCB announced the successful acquisition

of Zogenix, Inc. for a total purchase consideration (in

accordance with IFRS 3) of € 1.5 billion (excluding post-closing

settlement of convertible debt in a separate transaction).

UCB acquired shares of Zogenix, Inc. for a purchase price per

share of US$ 26.00 in cash at closing, plus a contingent value

right (CVR) for a potential cash payment of US$ 2.00 upon EU

approval by December 31, 2023, of FINTEPLA

** as an orphan

medicine for treatment of Lennox-Gastaut syndrome (LGS). As

a result of the acquisition, Zogenix, Inc. has become a wholly-

owned subsidiary of UCB and the common stock of Zogenix,

Inc. will be delisted from the NASDAQ Global Market. Zogenix,

Inc. is a global biopharmaceutical company commercializing

and developing therapies for rare diseases.

By acquiring Zogenix, Inc., UCB reinforces its sustainable

patient value strategy and continued commitment to

addressing unmet needs of people living with epilepsy with

an increasing focus on those living with specific or rare forms

of epilepsy, where few options exist. Complementing UCB’s

existing therapeutic offerings, the Zogenix, Inc. acquisition

provides UCB with an approved medicine for a life-threatening,

rare infant- and childhood-onset epilepsy marked by frequent

and severe treatment-resistant seizures that are particularly

challenging to treat. Utilizing UCB’s deep expertise, experience

and global capabilities, it plans to accelerate access for patients

to the treatment.

The acquisition builds on UCB’s continued epilepsy

ambitions, as it provides medicine that complements UCB’s

existing symptomatic treatments, bringing significant and

differentiated value to patients suffering from Dravet syndrome

and, if approved, from seizures associated with Lennox-

Gastaut syndrome and potentially other rare epilepsies. It

expands benefits for patients globally, as UCB brings an

established global footprint, together with deep research and

development, commercial, medical, and regulatory expertise in

epilepsy, which will be utilized to rapidly advance and optimize

the availability of these new treatments and reach additional

patients. Last, but not least, it enhances future epilepsy pipeline

and strategic priorities in rare/orphan diseases, as Zogenix,

Inc.’s pipeline will add to UCB’s short-term and long-term

epilepsy pipeline, as well as provide critical learnings in rare/

orphan disease health ecosystems and enhances UCB’s

top-line growth, as FINTEPLA

** was launched in the U.S.

and Europe in 2020 and has significant potential for usage in

other seizure types. The acquisition will contribute to UCB’s

revenue growth as from closing and will be accretive to UCB’s

earnings in 2023.

The total purchase consideration represents an amount of

€ 1 519 million (US$ 1 651 million). UCB has entered into a new

borrowing agreement to partially fund the acquisition price (see

Note 29 Borrowings).

The purchase consideration consists of a closing payment

€ 1 406 million and contingent consideration (Contingent

Value Rights) for a total amount of € 113 million.

Each contingent value right per share (CVR) represents a

non-transferable contractual contingent right to receive

a cash payment of US$ 2, without interest and less any

applicable withholding taxes, if, and only if, no later than

December 31, 2023, the European Commission approves

Zogenix, Inc.’s product FINTEPLA

** as an orphan medicinal

product for treatment of seizures associated with Lennox-

Gastaut syndrome, following an opinion rendered by the

Committee for Orphan Medicinal Products of the European

Medicines Agency (“EMA”) recommending that fenfluramine

hydrochloride for the treatment of Lennox-Gastaut syndrome

not be removed from the Community Register of Orphan

Medicinal Products.

The fair value of the contingent consideration is estimated

at € 113 million (US$ 123 million). This fair value takes into

account the assumed likelihood and timing of achieving

the arrangement’s regulatory milestones. No changes were

necessary to this estimate since acquisition date. The liability is

presented within Other current liabilities for US$ 123 million in

the consolidated balance sheet as per December 31, 2022.

The table below shows the final amounts for the net assets

acquired and goodwill recognized at the acquisition date:

** Prescribing information varies depending on regulatory approval in each country.

244 245

UCB | Integrated Annual Report 2022

The opening statement of financial position includes a financial

liability of US$ 307 million (€ 282 million) of which US$ 285

million (€ 262 million) on ST and US$ 22 million (€ 20 million) on

LT, that corresponds to the US$ 230 million principal amount of

2.75% convertible senior notes (due 2027), issued by Zogenix,

Inc. in 2020. The notes are measured at the fair value at the

acquisition date, which reflects the expected settlement of the

notes shortly after the acquisition date (between March 7 and

April 11, 2022).

The purchase accounting assessment has been finalized. The

estimated fair values primarily consisting of intangible assets,

deferred income tax assets, deferred tax liabilities and goodwill

as noted above are therefore to be considered as final. Fair value

estimates are based on a complex series of judgments about

future events and uncertainties and rely heavily on estimates

and assumptions. The judgments used to determine the

estimated fair value assigned to each class of assets acquired

and liabilities assumed, as well as asset lives, can materially

impact the UCB’s results of operations.

The Group identified and separately recognized intangible

assets for a total amount of € 1 803 million. These intangibles

are amortized on a straight line basis from acquisition till

moment of loss of exclusivity.

No contingent liabilities that could meet recognition

requirements under IFRS 3 have been identified.

The goodwill is attributable to expected synergies with UCB’s

biotech research activities as well as the assembled workforce.

Goodwill is not expected to be tax deductible.

Acquisition-related costs, which includes legal and other fees

for an amount of € 41 million have been recorded under Other

Expenses in 2022. This payment cannot be considered as being

part of the consideration transferred to the sellers in exchange

for control of Zogenix, Inc. in accordance with the provisions in

IFRS 3 Business combinations.

€ 143 million revenue is included in the consolidated income

statement for the reporting period since acquisition. Except

for transaction and acquisition costs, the loss of Zogenix,

Inc. included in the consolidated income statement for the

reporting period since acquisition is € 80 million. The amounts

of revenue and loss for Zogenix, Inc. assuming the acquisition

date would have been January 1, 2022 would not have

been materially different from what is included now in the

consolidated income statement.

Post-acquisition settlement of the convertible notes

of Zogenix, Inc.

Under the terms of the (original) indenture of the convertible

notes, the acquisition of Zogenix, Inc. by UCB constituted

a Make-Whole Fundamental Change. This has resulted in a

temporary adjustment of the conversion rate applicable to the

notes as follows:

• the conversion rate in effect prior to March 7, 2022 was

41.1794 shares of Zogenix, Inc. common stock per USD 1,000

principal amount of notes.

• an adjusted conversion rate is applicable for notes converted

from March 7, 2022 to April 11, 2022, i.e. 47.5994 of

reference property units per USD 1 000 principal amount

of notes (temporary adjustment in connection with the

Make-Whole Fundamental Change pursuant to § 5.07 of the

(original) Indenture.

€ million

Initial opening

statement of

financial position

Adjustments due

to initial purchase

price allocation

Adjusted opening

statement of

financial position

Total acquisition value

1 519 0 1 519

Cash consideration paid

1 406 0 1 406

Contingent consideration

113 0 113

Recognized amounts of identifiable assets acquired and

liabilities assumed

- 101 1 601 1 500

Non-current assets

Intangibles

0 1 803 1 803

Property, plant and equipment (incl. ROU assets)

16 0 16

Deferred income tax assets

23 207 230

Other non-current assets

2 0 2

Current assets

Cash

194 0 194

Other current assets

50 2 52

Non-current liabilities

Deferred taxes

0 410 410

Debt and debt like items

50 1 51

Current liabilities

Debt and debt like items

264 0 264

Payables

72 0 72

Goodwill

1 620 - 1 601 19

244 245

10. Other revenues

€ million 2022 2021

Upfront payments, milestone payments and reimbursements

189 99

Contract manufacturing revenues

103 128

Total other revenue

292 227

During 2022, UCB received milestone payments and

reimbursements from different parties, mainly:

• R-Pharm for the sale of IP rights (Olokizumab)

• Nippon Shinyaku mainly for the approval received on

FINTEPLA

** in Japan

• Biogen for co-development of antibody dapirolizumab pegol;

• Roche and Genentech for the global development and

commercialization of Bepranemab;

The revenue from contract manufacturing activities is mainly

linked to the entering into toll manufacturing agreements after

divestiture of established brands.

11. Operating expenses by nature

The table below illustrates certain items of expense recognized in the income statement using a classification based on their nature

within the Group:

€ million Note 2022 2021

Employee benefit expenses 

1 658 1 523

Depreciation of property, plant and equipment 

146 135

Amortization of intangible assets 

439 188

Impairment of non-financial assets (net) 

0 6

Total

2 243 1 852

9. Discontinued operations and assets and liabilities of disposal group

classified as held for sale

9.1 Discontinued operations

For 2022, the loss from discontinued operations amounts

to € - 2 million (3 million for 2021), and mainly relates to the

additional provision related to the Films business in Belgium.

9.2 Assets and liabilities of disposal group classified

as held for sale

There are no assets or liabilities of disposal group classified as

held for sale as per December 31, 2022.

Assets of disposal group classified as held for sale as per

December 31, 2021 relate to inventories following the

divestment of non-core established brand products. As not

all market authorizations were transferred to the buyer, UCB

was still owner of the inventories for these divested non-core

established brand products in some countries. No write-off was

accounted for on these inventories.

• any note that is converted after April 11, 2022 – 5:00 p.m.

NY City time, is settled based on the unadjusted conversion

rate, i.e. 41.1794 of reference property units per USD 1,000

principal amount of notes.

As from March 7, 2022, the reference property unit consists of

US$ 26 in cash plus one contingent value right.

Following the closing of the acquisition, all notes were

converted at the adjusted conversion rate of 47.5994 reference

property units per USD 1,000 principal amount of notes,

resulting in the cash outflow of US$ 285 million and additional

CVRs granted to the noteholders, recognized in the opening

balance sheet as a non-current other liability for the amount of

US$ 22 million.

** Prescribing information varies depending on regulatory approval in each country.

246 247

UCB | Integrated Annual Report 2022

12. Employee benefit expense

€ million Note 2022 2021

Wages and salaries

1 207 1 081

Social security costs

167 141

Post-employment benefits – defined benefit plans 

68 70

Post-employment benefits – defined contribution plans

21 25

Share-based payments to employees and directors 

81 109

Insurance

41 38

Other employee benefits

73 59

Total employee benefit expense

1 658 1 523

The total employee benefit expense has been allocated along

functional lines within the income statement.

Other employee benefits consist mainly of termination

benefits, severance payments, and other long-term/ short-term

disability benefits.

Headcount at December 31 2022 2021

Monthly Paid

2 790 2 860

Management

5 931 5 755

Total

8 721 8 615

Further information regarding post-employment benefits and share-based payments can be found in Notes 28 and 33.

13. Other operating income/expenses

€ million 2022 2021

Provisions

- 8 - 3

Impairment intangibles & PPE

- 2 0

Impairment trade & other receivable

- 23 - 2

Gain/Loss (-) on disposal of non-current assets

- 2 - 2

Reimbursement by third parties for development expenses

5 4

Grants received

11 18

Collaboration agreement for the development and commercialization of EVENITY

240 151

Collaboration agreement for the development and commercialization with Novartis

23 0

Other income/expenses (-)

- 28 - 4

Total other operating income / expenses (-)

216 162

The result of the collaboration agreement with Amgen for the

development and commercialization of EVENITY

** amounted

to € 240 million income (compared to € 151 million income in

2021). All recharges of development and commercialization

expenses to/from Amgen are classified as other operating

income/expenses. The equivalent total net recharges as per

December 31, 2022 consisted of € 246 million marketing

and selling income (€ 162 million in 2021) and € - 6 million

development expenses (€ - 11 million in 2021).

The result of the new collaboration agreement with Novartis

for the development and commercialization of UCB0599 with

an opt-in to develop UCB7853, two innovative and potentially

disease-modifying investigational assets in Parkinson’s

disease, amounted to € 23 million income. All recharges

of development and commercialization expenses to/from

246 247

17. Financial income and financial expenses

The net financial expenses for the year amounted to € 74 million (2021: € 58 million). The breakdown of the financial expenses and

financial income is as follows:

Financial Expenses

€ million 2022 2021

Interest expenses on:

Retail bonds

- 9 - 18

Institutional Eurobonds

- 7 - 6

Other borrowings

- 51 - 18

Financial charges on leases

- 4 - 3

Impairment of long term loans granted

- 2 0

Net loss on interest rate derivatives

- 1 0

Net fair value losses on foreign exchange derivatives

- 33 0

Net foreign exchange losses

0 - 90

Net other financial income/expenses (-)

- 5 - 3

Total financial expenses

- 112 - 138

Novartis are classified as other operating income/expenses.

The equivalent total net recharges as per December 31, 2022

consisted of € 23 million development expenses.

The provisions are mostly related to VAT risks, grant

recoverability risks & donation to Ukraine.

14. Impairment of non-financial assets

A review of the recoverable amounts of the Group’s assets

did not lead to the recognition of impairment charges (2021:

€ 6 million impairment losses on intangibles, relating to the

termination of projects).

No impairment charges for Group property, plant and

equipment were recognized in 2022 (2021: € 0 million).

No reasonably possible change in a key assumption on

which management has based its determination of the assets

recoverable amounts would cause the assets carrying amount

to exceed its recoverable amount.

15. Restructuring expenses

The restructuring expenses for the year ended

December 31, 2022 amount to € 42 million (2021: € 21 million)

and are related to new organization models and business

discontinuation. Provisions for restructuring as defined in IAS

37.70 that are included, meet the criteria in IAS 37.72.

16. Other income/expenses

Total other income/expenses amounted to an expense of

€ 48 million (2021: expense of € 7 million) and is comprised of

the following items:

• Gain on disposal: € 3 million in 2022 mainly related to the sale

of Alprostadil in Germany (€ 1 million loss in 2021).

• Other expenses: € 51 million in 2022, mainly relate to costs

related to the acquisition of Zogenix, Inc. (€ 41 million) and

the Distilbène provision and intellectual property fees (2021:

€ 6 million and mainly relate to the cumulative exchange

differences on liquidation and the Distilbène provision and

intellectual property fees).

** Prescribing information varies depending on regulatory approval in each country.

248 249

UCB | Integrated Annual Report 2022

18. Income tax expense (-)/credit

€ million 2022 2021

Current income taxes

- 183 - 192

Deferred income taxes

92 22

Total income tax expense (-)/credit

- 91 - 170

The Group operates internationally, implying being subject to

income taxes in many different tax jurisdictions.

The income tax expense on the Group’s profit before tax

slightly differs from the theoretical amount that would arise

using the weighted average tax rate applicable to profits (losses)

of the consolidated companies.

Income taxes recognized in the income statement can be

detailed as follows:

€ million 2022 2021

Profit before income taxes

511 1 226

Income tax expense (-) calculated at domestic tax rates applicable in the respective countries

- 96 - 234

Theoretical income tax rate

19% 19%

Reported current income tax

- 183 - 192

Reported deferred income tax

92 22

Total reported tax charge

- 91 - 170

Effective income tax rate

18% 14%

Difference between theoretical and reported tax

5 64

Expenses non-deductible for tax purposes

- 45 - 27

Non-taxable income

- 10 16

Increase (-) / decrease of liabilities for uncertain tax positions

20 0

Tax credits

98 91

Variation in tax rates

- 2 22

Current tax adjustments related to prior years

3 - 14

Deferred tax adjustments related to prior years

- 8 7

Net effect of previously unrecognised DTA and non-recognition of current year deferred tax assets

- 48 - 32

Withholding tax

- 2 - 3

Other taxes

- 4 6

Total difference between theoretical and reported income tax

5 64

Financial Income

€ million

2022 2021

Interest income on:

Bank deposits

4 2

Interest rate derivatives

8 5

Net gain on interest rate derivatives

0 2

Net fair value gain on foreign exchange derivatives

0 71

Net foreign exchange gains

26 0

Total financial income

38 80

248 249

The theoretical income tax rate of 19% remains stable

compared to the prior year.

The effective tax rate of 18% stems from a current tax charge

and a deferred tax credit. The key drivers for the rate can be

summarized as follows:

Current Tax:

• Impact of predominantly R&D related tax incentives in

key jurisdictions.

• New U.S. regulations requiring taxpayers to capitalize and

amortize R&D expenses.

Deferred Tax:

• Increase to the tax rate in respect of unrecognized deferred tax

assets, notably carry-forward losses and innovation income

deduction in the period with BIMZELX

* U.S. not approved

as main driver.

• Recognition of additional deferred tax assets on R&D tax credits

which will be offset against future taxable income.

• Remeasurement of tax attributes based upon the level of

projected future taxable profits driven by reorganization and

acquisition transactions.

Factors affecting the tax charge in future years

The Group is aware of many factors that could impact the

future effective tax rate of the Group, in particular the profit/

losses mix between different territories in which the Group

operates, the amount of unrecognized losses and other tax

attributes that in future can be recognized as a deferred tax

asset on the statement of financial position and the outcome

of ongoing and future tax audits.

Corporate restructuring, acquisitions, disposals and other

transactions may also impact the Group’s future tax charge.

Changes to tax legislation in jurisdictions where the Group

operates as well as the impact of international tax rules may

also have a major impact. UCB is closely following up the

discussions on the OECD’s initiatives on the tax challenges

arising from the digitalization of the economy that are likely

to be enacted into local legislation in 2023. These new

international tax rules may have an impact on UCB’s longer

term tax position.

Next to the OECD developments, UCB follows up closely

on tax developments in the entire EU and in key jurisdictions

with a substantial sales or R&D footprint, such as Belgium, the

U.S and the U.K.

19. Components of other comprehensive income (including NCI)

January 1, 2021

Movements

2021 net of tax

December 31,

2021

Movements

2022 net of tax

December 31,

2022

Items of OCI to be reclassified to

profit or loss in subsequent periods:

- 271 199 - 72 363 292

Cumulative translation adjustments

- 372 280 - 92 272 181

Financial assets at FVOCI

36 22 58 4 62

Cash flow hedges

65 - 103 - 38 87 49

Items of OCI not to be reclassified to

profit or loss in subsequent periods:

- 330 87 - 243 132 - 112

Remeasurement of defined benefit obligation

- 330 87 - 243 132 - 112

Total other comprehensive income attributed

to equity holders

- 601 286 - 315 495 180

1 NCI: non-controlling interest

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

250 251

UCB | Integrated Annual Report 2022

20. Intangible assets

2022

€ million

Trademarks,

patents

and licenses Other

Total

Gross carrying amount at January 1

5 359 461 5 820

Additions

45 45 90

Disposals

- 5 - 21 - 26

Business Combinations

1 803 0 1 803

FX on Business Combinations

63 0 63

Transfer from one heading to another

4 15 19

Effect of movements in exchange rates

144 3 147

Gross carrying amount at December 31

7 413 503 7 916

Accumulated amortization and impairment losses at January 1

- 2 376 - 285 - 2 661

Amortization charge for the year

- 398 - 44 - 442

Disposals

8 20 28

Impairment losses recognized in the income statement

- 2 0 - 2

Transfer from one heading to another

2 0 2

Effect of movements in exchange rates

- 23 - 2 - 25

Accumulated amortization and impairment losses at December 31

- 2 789 - 311 - 3 100

Net carrying amount at December 31

4 624 192 4 816

2021

€ million

Trademarks,

patents

and licenses Other

Total

Gross carrying amount at January 1

4 960 449 5 409

Additions

148 22 170

Disposals

0 - 52 - 52

Business Combinations

0 0 0

FX on Business Combinations

0 0 0

Transfer from one heading to another

1 39 40

Effect of movements in exchange rates

250 3 253

Gross carrying amount at December 31

5 359 461 5 820

Accumulated amortization and impairment losses at January 1

- 2 138 - 298 - 2 436

Amortization charge for the year

- 152 - 36 - 188

Disposals

0 50 50

Impairment losses recognized in the income statement

- 6 0 - 6

Transfer from one heading to another

2 0 2

Effect of movements in exchange rates

- 82 - 1 - 83

Accumulated amortization and impairment losses at December 31

- 2 376 - 285 - 2 661

Net carrying amount at December 31

2 983 176 3 159

250 251

The Group amortizes all intangible assets once they are placed

in service. The amortization of intangible assets is allocated

to cost of sales for all intangible assets that are related to

compounds. The amortization charges related to software are

allocated to the functions that use this software.

The majority of the Group intangible assets arose from previous

acquisitions. During 2022, the Group acquired intangible assets

totaling € 90 million (2021: € 170 million). These additions

stem from in-licensing deals, software and capitalized eligible

development costs and capitalization of external development

expenses for post approval studies. Regarding the software and

eligible software development costs, the Group capitalized

€ 15 million (2021: € 20 million).

In 2022, UCB recognized intangibles assets of € 1 803 million

(2021: € 0 million) from business combinations with Zogenix,

Inc. (refer to Note 8).

Disposals in 2022 and in 2021 mainly relate to old software

not used anymore.

During the year, the Group recognized total impairment

charges of € 2 million (2021: € 6 million).

The amortization charge for the period amounted to

€ 442 million (2021: € 188 million).

There was also a transfer of assets for € 21 million from

property, plant and equipment to intangibles.

Furthermore there was an impact from translation of foreign

currencies of € 122 million in 2021 (2021: € 170 million).

Other intangible assets are primarily comprised of software and

in-process development projects. The in-process development

project assets are not amortized until they are available for

use (i.e. when related products are launched for sale) and

transferred to the licenses caption.

21. Goodwill

€ million 2022 2021

Net book value at January 1

5 173 4 964

Acquisition

19 0

FX on acquisition

1 0

Effect of movements in exchange rates

147 209

Net book value at December 31

5 340 5 173

The Group tests goodwill for impairment annually or more

frequently if there are indications that goodwill might be

impaired. For the purpose of the impairment testing, the Group

operates as one segment, Biopharmaceuticals, and has one

single cash generating unit (CGU), which represents the lowest

level at which the goodwill is monitored.

The recoverable amount of the CGU is determined based on

the value-in-use calculations and the methodology applied

for performing the impairment testing has not been modified

compared to 2021.

Key assumptions

The calculations performed are based on the cash flow

projections as derived from the financials underlying the

10-year strategic plan approved by management and Board

of Directors. Given the nature of the industry, the long-term

projections are used to fully model the appropriate product

lifecycles based on the patent expiry and therapeutic area.

These long-term projections, which are based on past

performance and management’s expectations of market

developments, are adjusted for specific risks and include:

• the revenue growth rates of newly launched products;

• the probability of reaching commercial stage for new products

and or indications;

• the probability of success of future product launches and the

expected dates thereof;

• the post-patent expiry erosion.

The key assumptions, when comparing to 2021, were

adapted taking into account the latest developments of the

probabilities of success and the post-patent expiry erosion.

For the “value in use” calculations required for the impairment

testing, a discount rate of 6.64 % was used.

Taking into account current market evolutions, the cash flows

beyond the projected forecasted period (terminal value) are

extrapolated using an estimated growth rate of 2%, compared

to 2% in 2021. The growth rate does not exceed the long-

term average growth rate for the relevant territories in which

the CGU operates.

252 253

UCB | Integrated Annual Report 2022

The Group has most of its revenue and expenses in EUR and

USD based countries. The following important exchange

rates were used in preparing the future cash flows:

10 Years

Projection 2021

USD

1.15 – 1.16 1.22 – 1.30

GBP

0.85 – 0.96 0.89 – 1.09

JPY

111 – 133 118 – 129

CHF

1.02 – 1.04 1.06 – 1.08

Starting from risk-free short-term LIBOR EUR 6 months and

long-term EU generic government bonds 20 years (2021:

years), the discount rate applied is determined based on the

weighted average cost of capital for DCF models, including

the 20 years (2021: 20 year) benchmark cost of debt and

equity, adjusted to reflect the specific asset and country risks

associated with the CGU. Given the industry, the Group used

a discount rate of 6.64% (2021: 6.05%). The discount rate is

reviewed at least annually.

Since after-tax cash flows are incorporated into the calculation

of the value-in-use of the CGU, a post-tax discount rate is used

in order to remain consistent.

The use of the post-tax discount rate approximates the result of

using a pre-tax rate applied to pre-tax cash flows. A tax rate up

to 20% was used (2021: 20%).

Sensitivity analysis

Based on the above, management assessed that no reasonable

change in any of the key assumptions for the determination

of the recoverable amount would cause the carrying value

of the CGU to materially exceed its recoverable amount.

For information purposes, the sensitivity analysis using a 0%

perpetual growth rate combined with an overall discount rate

below 15% would not result in an impairment of the goodwill.

22. Property, plant and equipment

2022

€ million

Land and

buildings

Plant and

machinery

Office,

computer

equipment,

vehicles and

other

Assets under

construction Total

Gross carrying amount at January 1

828 1 007 167 418 2 420

Additions

12 28 33 231 304

Business combinations

20 0 1 0 21

Disposals

- 4 - 5 - 27 0 - 36

Transfer from one heading to another

43 41 5 - 110 - 21

Effect of movements in exchange rates

4 11 2 2 19

Gross carrying amount at December 31

903 1 082 181 541 2 707

Accumulated depreciation at January 1

- 390 - 640 - 115 0 - 1 145

Depreciation charge for the year

- 48 - 70 - 30 0 - 148

Disposals

3 3 27 0 33

Business combinations

- 4 0 - 1 0 - 5

Effect of movements in exchange rates

- 2 - 6 - 2 0 - 10

Accumulated depreciation at December 31

- 440 - 713 - 121 0 - 1 273

Net carrying amount at December 31

463 369 60 541 1 434

252 253

2021

€ million

Land and

buildings

Plant and

machinery

Office,

computer

equipment,

vehicles

and other

Assets under

construction Total

Gross carrying amount at January 1

737 911 169 244 2 061

Additions

49 24 21 292 386

Disposals

- 7 - 2 - 34 0 - 43

Transfer from one heading to another

21 51 9 - 123 - 42

Effect of movements in exchange rates

28 23 2 5 58

Gross carrying amount at December 31

828 1 007 167 418 2 420

Accumulated depreciation at January 1

- 346 - 562 - 118 0 - 1 026

Depreciation charge for the year

- 43 - 64 - 28 0 - 135

Disposals

9 2 33 0 44

Effect of movements in exchange rates

- 10 - 16 - 2 0 - 28

Accumulated depreciation at December 31

- 390 - 640 - 115 0 - 1 145

Net carrying amount at December 31

438 367 52 418 1 275

None of the Group property, plant and equipment is subject

to restrictions on title nor has it been pledged as security

for liabilities.

During 2022, the Group acquired property, plant and

equipment totaling € 304 million (2021: € 386 million). These

additions include right-of-use assets for € 39 million (2021:

€ 63 million). € 105 million relate to Bioplant Braine site

reported in assets under construction. Tangible assets with

net book value of € 16 million were recognized from Zogenix,

Inc. acquisition (see Note 8). Other additions relate to the

revamping of the office environment, building facilities and IT

hardware and other plant and equipment.

During the year, the Group did not recognize any impairment

expenses (2021: impairment of € 0 million).

The depreciation charge for the year amounts to € 148 million

(2021: € 135 million) and includes the depreciation on the right-

of-use assets (€ 46 million).

Capitalized borrowing costs

No borrowing costs were capitalized during 2022

(2021: € 0 million).

23. Financial and other assets

23.1 Non-current financial and other assets

€ million Note 2022 2021

Financial assets at FVOCI (excl. derivatives) .

134 130

Cash deposits

16 16

Derivative financial instruments 

28 9

Reimbursement rights with respect to German defined benefit plans

24 24

Other financial assets

16 22

Non-current financial and other assets

218 201

254 255

UCB | Integrated Annual Report 2022

23.2 Current financial and other assets

€ million Note 2022 2021

Clinical trial materials

196 163

Financial assets at FVOCI (excl. derivatives) .

47 49

Loans granted to third parties

3 0

Derivative financial instruments 

123 61

Current financial and other assets

369 273

23.3 Financial assets at fair value through other comprehensive income (FVOCI) (excl. derivatives)

The current and non-current financial assets at FVOCI (excl. derivatives) comprise the following:

€ million 2022 2021

Equity securities

181 179

Financial assets at FVOCI (excl. derivatives)

181 179

The movement in the carrying values of the financial assets at FVOCI (excl. derivatives) is as follows:

2022 2021

€ million

Equity

securities

Equity

securities

At January 1

179 115

Additions

22 47

Disposals

- 20 - 1

Fair value gains/losses (-) going through OCI

0 18

At December 31

181 179

For more information on the derivatives of which fair

value movements are accounted for through OCI, we

refer to Note 39 .

For the financial assets that are valued at amortized cost, the

carrying amount approximates the fair value.

The Group does not have any investments in debt instruments.

The equity securities include investments in UCB Ventures as

well as investments in companies where UCB does not have

significant influence. These investments have been classified as

financial assets at FVOCI. The investments are measured at fair

value. All fair value gains and losses are presented in OCI.

The additions to financial assets at FVOCI in the year include

€ 16 million investments made in UCB Ventures, UCB’s

corporate venture fund. The fair value gains and losses going

through OCI are offsetting each other and resulted in a net

impact of € 0 million.

The current financial assets at FVOCI (€ 47 million in 2022

compared to € 49 million in 2021) relate to vested long term

incentives granted to employees. These are held in custody for

the account of the relevant participants on a separate securities

account of UCB. There is a corresponding liability which is

recorded in Other Payables (Note 35). As these shares are held

for the account of the relevant participants and not for UCB’s

account, these are not treated as treasury shares in accordance

with IAS 32.33.

23.4 Investment in associates

The Group has no investments in associates.

23.5 Joint operations

No joint operations were entered into by the Group in 2022.

23.6 Subsidiaries with material non-controlling interests

As of December 31, 2022 and 2021 there is no accumulated

non-controlling interest.

254 255

24. Inventories

€ million 2022 2021

Raw materials and consumables

121 100

Work in progress

601 586

Finished goods

184 192

Goods purchased for resale

1 0

Inventories

907 878

The cost of inventories recognized as an expense and

included in “cost of sales” amounted to € 859 million (2021:

€ 772 million). There are no inventories pledged for security,

nor is there any inventory stated at net realizable value.

The write-down on inventories amounted to € 70 million in

2022 (2021: € 34 million) and has been included in cost of

sales. Total inventory increased by € 29 million and related to

increase of Core products.

25. Trade and other receivables

€ million 2022 2021

Trade receivables

702 905

Less: provision for impairment

- 15 - 18

Trade receivables – net

687 887

VAT receivable

36 42

Interest receivables

14 3

Prepaid expenses

140 156

Accrued income

1 0

Other receivables

157 132

Royalty receivables

17 19

Trade and other receivables

1 051 1 239

The carrying amount of trade and other receivables

approximates their fair values. With respect to trade receivables,

the fair value is estimated to be the carrying amount less the

provision for impairment and for all other receivables the

carrying value approximates fair value given the short-term

maturity of these amounts.

There is some concentration of credit risk with respect to trade

receivables. For some credit exposures in critical countries,

such as the Southern European countries, the Group obtained

credit insurance. The Group co-operates with dedicated

wholesalers in certain countries. The largest outstanding trade

receivable in 2022 from a single customer is 14% (2021: 16%)

from McKesson Corp. U.S..

256 257

UCB | Integrated Annual Report 2022

The aging analysis of the Group trade receivables at year-end is as follows:

2022 2021

€ million

Gross

carrying

amounts Impairment

Gross

carrying

amounts Impairment

Not past due

671 0 885 0

Past due – less than one month

15 0 6 0

Past due more than one month and not more than three months

2 0 4 0

Past due more than three months and not more than six months

6 - 1 2 0

Past due more than six months and not more than one year

1 - 6 0 - 11

Past due more than one year

7 - 8 8 - 7

Total

702 - 15 905 - 18

Based on historical default rates, the Group believes that

no provision for impairment is necessary in respect of trade

receivables not past due. This concerns 96% (2021: 98%) of the

outstanding balance at the statement of financial position date.

The movement in the provision for impairment in respect of

trade receivables is shown below:

€ million 2022 2021

Balance at January 1

- 18 - 16

Impairment charge recognized in the income statement

- 2 - 2

Utilization / reversal of provision for impairment

5 0

Balance at December 31

- 15 - 18

The other receivables contain € 25m of impairment. The remaining classes within trade and other receivables do not contain

impaired assets.

The carrying amounts of the Group trade and other receivables are denominated in the following currencies:

€ million 2022 2021

EUR

337 303

USD

413 593

JPY

79 135

GBP

48 44

CNY

30 40

CHF

19 16

KRW

10 8

Other currencies

115 100

Trade and other receivables

1 051 1 239

The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable mentioned above.

The Group does not hold any collateral as security.

256 257

26. Cash and cash equivalents

€ million 2022 2021

Short-term bank deposits

696 1 011

Cash at bank and on hand

203 252

Cash and cash equivalents (excluding bank overdrafts)

899 1 263

Cash and short-term deposits of € 68 million are held mostly in

countries with restrictive regulations on exporting capital from

the country other than via normal dividends, such as Brazil,

China, India, Korea, Russia, Thailand and Turkey.

For the purpose of presentation in the Statement of Cash

Flows, cash and cash equivalents comprise cash on hand

and demand deposits and other short-term highly liquid

investments with original maturities of three months or less that

are readily convertible to known amounts of cash and which

are subject to an insignificant risk of changes in value, and bank

overdrafts. Bank overdrafts are shown within borrowings in

current liabilities in the statement of financial position.

€ million Note 2022 2021

Cash and cash equivalents

899 1 263

Bank overdrafts 

- 40 - 19

Cash and cash equivalents (including bank overdrafts)

859 1 244

27. Capital and reserves

27.1 Share capital and share premium

The issued share capital of the Company amounted to

€ 584 million (2021: € 584 million), and is represented

by 194 505 658 shares (2021: 194 505 658 shares).

The Company’s shares are without par value. At

December 31, 2022, 70 251 215 shares were registered and

124 254 443 were dematerialized shares. The holders of UCB

shares are entitled to receive dividends as declared and are also

entitled to one vote per share at the shareholders’ meeting of

the Company. There is no authorized, unissued capital.

At December 31, 2022, the share premium reserves amounted

to € 2 030 million (2021: € 2 030 million).

27.2 Treasury shares

The Group acquired, through UCB SA 500 000 treasury shares

(2021: 750 000) for a total amount of € 42 million (2021:

€ 60 million) and transferred 921 021 treasury shares (2021:

898 441) for a total amount of € 75 million (2021: € 69 million).

Net transfer of 421 021 treasury shares for a net amount

of € 33 million.

During 2022, the Group did not acquire or dispose of any

treasury shares as part of share swap transactions (2021: 0

acquired and 0 disposed). At December 31, 2022, the Group

retained 4 910 760 treasury shares of which none related

to share swap deals (2021: 5 331 781). These treasury shares

have been acquired in order to honor the exercise of stock

options and share awards granted to the Executive Committee

members and certain categories of employees.

In the current year, no call options on UCB shares have been

acquired (2021: 0) nor have any call options been exercised

(2021: 0). At December 31, 2022, the Group did not hold any

options on UCB shares (December 31, 2021: 0).

27.3 Other reserves

Other reserves amount to € 76 million (2021: € - 56 million)

with the movement related to the re-measurement of the

defined benefit obligation for € 132 million bringing total

remeasurement value at € - 120 million (2021: € - 252 million).

27.4 Cumulative translation adjustments

The cumulative translation adjustments reserve represents

the cumulative currency translation differences relating to

the consolidation of Group companies that use functional

currencies other than the euro as well as any unrealized

cumulative foreign exchange gains or losses resulting from net

investment hedges.

258 259

UCB | Integrated Annual Report 2022

28. Share-based payments

The Group operates several equity-based and cash-based

compensation plans, including a stock option plan, a stock

appreciation rights plan, a stock award plan and a performance

share plan to compensate employees for services rendered.

The stock option plan, the stock award plan and the

performance share plan are equity-settled, whereas the stock

appreciation rights plan is a cash-settled plan. Besides these

plans, the Group also operates employee stock purchase plans

in the U.K. and the U.S. and phantom share plans. The expenses

incurred for these plans are immaterial.

28.1 Stock option plan and stock appreciation rights plan

The Governance, Nomination and Compensation Committee

(GNCC) granted options on UCB SA shares to the Executive

Committee members, the senior executives and the senior

directors of the UCB Group. The exercise price of the granted

options under these plans is equal to the lowest of the

following two values:

• the average of the closing price of the UCB shares on Euronext

Brussels, during the 30 days preceding the offer; or

• the closing price of the UCB shares on Euronext Brussels the

day before the grant.

A different exercise price is determined for those eligible

employees subject to legislation which requires a different

exercise price in order to benefit from reduced taxation. The

options become exercisable after a vesting period of three

years, except for those eligible employees subject to legislation

which requires a longer vesting period in order to benefit from

reduced taxation. If an employee leaves the Group, his/her

options usually lapse upon expiry of a period of six months.

Options do not lapse in case of death or retirement and in case

of involuntary termination when taxes have been paid upon

grant. The Group has no obligation to repurchase or settle the

options in cash.

The options are not transferable (except in case of death).

The Stock Appreciation Rights (S.A.R.’s) plan has similar

characteristics to the stock option plan, except that

it is reserved for UCB employees in the U.S. This plan

is cash-settled.

28.2 Stock award plan

The GNCC granted free UCB SA shares to the Executive

Committee members, the senior executives and the senior and

middle management of the UCB Group. The free shares have

service conditions attached to them whereby beneficiaries

are required to remain in service for three years post grant

date. Stock awards lapse upon leaving the Group, except

upon leaving on retirement or death in which case they vest

immediately. The beneficiary is not entitled to dividends during

the vesting period.

28.3 Performance share plan

The GNCC granted performance shares to senior executives

for specific achievements aligned with company strategic

priorities. The performance shares are conditional on the

beneficiary completing three years of service (the vesting

period) and the number of shares award is adjusted at the end

of the vesting period based on the company’s performance

against its goals.

Performance Shares lapse upon leaving the Group, except

upon leaving on retirement or death in which case they vest

immediately. The beneficiary is not entitled to dividends during

the vesting period.

28.4 Phantom stock option, stock award and

performance share plans

The Group also has phantom stock option, phantom stock

award and phantom performance share plans (collectively

referred to as phantom plans). These phantom plans apply

to certain employees who have an employment contract

with certain affiliates of the Group and are governed under

similar rules to the Group stock option, stock award and

performance share plans except for their settlement. As of

December 31, 2022, these plans had 270 participants (2021:

262) and the share-based payment expense incurred for these

plans is immaterial.

28.5 North America employee stock purchase plan

The plan is intended to provide employees of UCB affiliates in

North America with an opportunity to purchase common stock

of the Group. Shares are acquired at a discount of 15% which is

funded by UCB. Employees save a defined percentage of their

salary through payroll deduction and shares will be purchased

with after-tax employee contributions. The shares are held by

an independent third party banking institution in an account in

the employee’s name.

The limit placed on employees’ participation in the

plan is as follows:

• between 1% and 10% of each participant’s compensation;

• US$ 25 000 per year per participant;

• maximum of US$ 10 million total ownership by North

America employees in all forms of share plans over a rolling

period of 12 months.

As of December 31, 2022, the plan had 811 participants (2021:

864). There are no specific vesting conditions and the share-

based payment expense incurred for this plan is immaterial.

28.6 Stock savings plan in the U.K.

The purpose of this plan is to encourage the holding of UCB

shares by employees in the U.K. Participants save a certain

portion of their salary through payroll deductions and UCB

matches every 1 share bought by each participant with 1 free

share. Shares are held in an account in the employee’s name

by an independent company that acts as a trustee. Employee

contributions to the plan are limited to the lower of:

• 10% of each participant’s compensation;

• GBP 1 800 per year per participant.

As of December 31, 2022, the plan had 438 participants (2021:

394) and the share-based payment expense incurred for this

plan is immaterial.

258 259

28.7 Share-based payment expense

The total share-based payment expense incurred for the Group

amounted to € 81 million (2021: € 109 million), and has been

included in the relevant functional lines within the income

statement as follows:

€ million 2022 2021

Cost of sales

12 14

Marketing and selling expenses

20 26

Research and development expenses

32 42

General and administrative expenses

17 27

Total operating expense

81 109

Of which, equity-settled:

Stock option plans

5 4

Stock award plans

71 75

Performance share plan

9 15

Of which, cash-settled:

Stock appreciation rights plan

- 5 10

Phantom stock option, stock award and performance share plans

1 5

28.8 Stock option plans

The movements in the number of stock options outstanding and their related weighted average exercise prices as at

December 31 are:

2022 2021

Weighted

average

fair value

(€)

Weighted

average

exercise

price (€)

Number

of stock

options

Weighted

average

fair value

(€)

Weighted

average

exercise

price (€)

Number

of stock

options

Outstanding at January 1

13.16 67.35 3 146 115 12.44 63.50 3 341 054

+ New options granted

25.96 102.17 312 253 16.06 80.02 328 987

(-) Options forfeited

16.46 78.43 25 521 13.30 66.94 32 584

(-) Options exercised

11.05 53.35 462 844 10.20 49.55 462 828

(-) Options expired

8.82 32.36 14 400 6.48 26.72 11 600

(-) Options converted in other plans

0.00 0.00 0 12.40 69.43 16 914

Outstanding at December 31

14.83 73.30 2 955 603 13.16 67.35 3 146 115

Number of options fully vested:

At January 1

1 582 306 1 320 368

At December 31

1 624 209 1 582 306

260 261

UCB | Integrated Annual Report 2022

The stock options outstanding as at December 31, 2022 with the following last exercise dates and exercise prices are:

Last exercise date Range of exercise prices (€) Number of stock options

March 31, 2023

[48.69 – 49.80] 212 229

March 31, 2024

58.12 126 262

March 31, 2025

67.35 230 540

March 31, 2026

67.24 239 987

March 31, 2027

[70.26 – 72.71] 304 217

March 31, 2028

66.18 371 603

March 31, 2029

[76.09 – 76.56] 428 041

March 31, 2030

[76.21 – 79] 410 141

March 31, 2031

[79.99 – 81.12] 322 794

March 31, 2032

[102.04 – 108.45] 309 789

Total outstanding

2 955 603

The fair value has been determined based on the Black-Scholes

valuation model.

The volatility was determined primarily by reference to

historically observed share prices of UCB over the last five

years. The probability of early exercise is reflected in the

expected life of the options. The expected forfeiture rate is

based on actual turnover of employees for categories eligible

for stock option compensation.

The significant assumptions used in the measurement of the

fair value of the stock options granted in 2022 and 2021 are:

2022 2021

Share price at grant date

€ 108.40 81.00

Weighted average exercise price

€ 102.17 80.02

Expected volatility

% 27.68 28.23

Expected option life

Years 5.00 5.00

Expected dividend yield

% 1.20 1.57

Risk free interest rate

% 0.61 - 0.50

Expected annual forfeiture rate

% 7.00 7.00

260 261

2022 2021

Outstanding rights as of January 1

754 249 756 680

+ New rights granted

148 056 163 462

+ Rights converted from other plans

0 16 914

(-) Rights forfeited

44 029 50 125

(-) Rights exercised

97 320 120 482

(-) Rights expired

11 000 12 200

Outstanding rights as of December 31

749 956 754 249

The significant assumptions used in the measurement of the fair value

of the stock appreciation rights are:

Share price at year end

€ 73.56 100.35

Exercise price

€ 108.45 81.12

Expected volatility

% 27.86 27.40

Expected option life

Years 5.00 5.00

Expected dividend yield

% 1.77 1.27

Risk free interest rate

% 2.91 - 0.38

Expected annual forfeiture rate

% 7.00 7.00

28.10 Stock award plans

The share-based payment expense related to these stock

awards is spread over the vesting period of three years.

The beneficiaries are not entitled to dividends during the

vesting period. The movement in the number of stock awards

outstanding at December 31 is as follows:

2022

2021

Number

of stock

awards

Weighted

average fair

value (€)

Number of

stock awards

Weighted

average fair

value (€)

Outstanding at January 1

2 334 810 80.58 2 480 525 76.49

+ New stock awards granted

763 466 106.95 743 691 81.64

(-) Awards forfeited

223 810 87.31 206 091 79.03

(-) Awards vested and paid out

685 991 78.21 683 315 67.37

Outstanding at December 31

2 188 475 89.83 2 334 810 80.58

28.11 Performance share plans

The movement in the number of performance shares outstanding at December 31 is as follows:

2022

2021

Number of

Weighted

average fair

value (€)

Number of

Weighted

average fair

value (€)

Outstanding at January 1

467 843 81.02 395 873 76.91

+ New performance shares granted

185 965 102.11 205 875 81.36

(-) Performance shares forfeited

150 008 82.88 30 822 79.26

(-) Performance shares vested

147 577 77.78 103 083 66.32

Outstanding at December 31

356 223 92.50 467 843 81.02

28.9 Stock appreciation rights (S.A.R.’s) plan

The movements of the S.A.R.’s and the model inputs as at

December 31, 2022 can be found in the table below.

The fair value of the S.A.R.’s at grant date is determined using

the Black-Scholes model. The fair value of the liability is

remeasured at each reporting date.

262 263

UCB | Integrated Annual Report 2022

29. Borrowings

The carrying amounts and fair values of borrowings are as follows:

Cash Flows Non-cash changes

€ million

2021

From

Financing

activities

Increase/

Decrease

in cash

ransfer

Non-Current to

Current

Foreign

Exchange

Movement

Other 2022

Non-current

Bank borrowings

1 155 733 0 0 101 0 1 989

Other long-term loans

0 0 0 0 0 0 0

Leases

97 - 37 0 0 3 37 100

Total non-current borrowings

1 252 696 0 0 104 37 2 089

Current

Bank overdrafts

19 0 20 0 1 0 40

Current portion of bank

borrowings

- 2 0 0 0 0 1 - 1

Debentures and other short-

term loans

0 9 0 0 0 0 9

Leases

38 - 9 0 0 0 11 40

Total current borrowings

55 0 20 0 1 12 88

Total borrowings

1 307 696 20 0 105 49 2 177

On December 31, 2022 the Group’s weighted average

interest rate (excluding leases) was 4.05% (2021: 1.30%) prior

to hedging. The floating interest rate payments are subject to

designated cash flow hedges and fixed interest rate payments

are subject to designated fair value hedges, thereby fixing the

weighted average interest rate for the Group at 3.48% (2021:

1.05%) post hedging. The fees paid for the arrangement of the

bonds (Note 30), and the amended facilities agreement are

amortized over the life of the instruments.

Where applicable under hedge accounting, the fair value of the

non-current borrowings is determined based on the present

value of the payments associated with the debt instruments,

using the applicable yield curve and UCB credit spread for the

various different currencies.

Since the bank borrowings are at a floating interest rate that

is reset minimally on a daily, up to on a semi-annual basis,

the carrying amount of the bank borrowings equates to

its fair value.

With respect to the current borrowings, the carrying amounts

approximate their fair values as the effect of discounting is

considered to be insignificant.

On January 9, 2018 the Group amended and extended

its € 1 billion revolving credit facility then maturing on

January 9, 2021 into a € 1 billion revolving credit facility with

maturity in 2023 (including the option to request further

extensions of the maturity date by two additional years). In

December 2019, the Group extended the maturity of its credit

facility to January 9, 2025 (no further extension option is

available). Per December 31, 2022 there were no outstanding

amounts under the revolving credit facility (2021: € 0 million).

On October 10, 2019, the Group entered into a US$ 2.1 billion

bullet term loan facility agreement, maturing in 2025, to

finance the Ra Pharma acquisition. In 2022, this agreement

has been amended in order to replace references to USD-

libor by references to SOFR (Secured Overnight Financing

Rate). Additional interest rate hedges have been entered into

following the amendment in order to ensure the continued

effectiveness of the existing cash flow hedges under

IFRS9 requirements.

Per December 31, 2022 there was US$ 1.060 billion

outstanding under this term loan facility (2021: US$ 1.315

billion), excluding any incremental facility established under this

term loan facility.

On November 18, 2022, the Group entered into a

€ 350 bilateral committed bullet loan agreement,

with availability period until November 2023 and with

maximum tenor of 8 years as from the date of drawing. Per

December 31, 2022 the loan remained undrawn.

On January 19, 2022, the Group entered into a US$ 800 million

bullet term loan facility agreement, maturing in 2027, to finance

the Zogenix, Inc. acquisition. In 2022, UCB entered into interest

rate hedges in connection with this term loan, which have

been designated as cash flow hedges and are considered fully

effective under IFRS9 requirements.

Per December 31, 2022 there was US$ 800 million outstanding

under this term loan facility.

On July 8, 2022 the Group signed a € 90 million bilateral

loan, established as a first incremental facility under the

US$ 2.1 billion loan facility agreement which was drawn on

October 3, 2022 and with maturity in 2029.

On November, 2 2022 the Group entered into a multi-tranche

Schuldscheindarlehen (SSD) transaction for an aggregate

amount of € 144 million and $ 20 million.

262 263

The Group has access to certain further committed and non-

committed bilateral credit facilities. In this respect, per end of

2022 an aggregated amount of € 30 million was undrawn on

the committed bilateral facility (2021: € 38 million). The Group

also has access to the Belgian commercial paper market.

€ 8.5 million was outstanding as per 31 December, 2022

(2021: € 0 million).

30. Bonds

The carrying amounts and fair values of bonds are as follows:

Carrying amount Fair value

€ million

Coupon

rate

Maturity

date

2021

Cash Flows

Fair Value

changes

Other

movements

2022 2021 2022

Institutional Eurobond

1.000% 2028 487 0 - 67 0 420 502 408

EMTN Note

1.000% 2027 147 0 - 19 1 129 150 121

Retail bond

5.125% 2023 182 0 - 8 0 174 191 177

Total bonds

816 0 - 94 1 723 843 706

Of which:

Non-current

816 0 - 94 1 549 843 529

Current

0 0 0 0 174 0 177

Derivatives used

for hedging

5 0 94 0 99

Of which:

Non-current assets (-)

5 0 93 0 98

Current assets (-)

0 0 1 0 1

Non-current

liabilities (+)

0 0 0 0 0

Current liabilities (+)

0 0 0 0 0

Please refer to Note 5.3 for the maturity analysis of the Group

borrowings (excluding other financial liabilities).

The carrying amounts of the Group borrowings are

denominated in the following currencies:

€ million 2022 2021

USD

1 869 1 232

EUR

284 40

GBP

6 10

CNY

5 6

JPY

3 5

Other

10 14

Total borrowings

2 177 1 307

1 EMTN: Euro Medium Term Note. The fair value of the EMTN Notes cannot be accurately determined given the limited liquidity in secondary market trading for these notes, and is for

reporting purposes replaced by the carrying value.

264 265

UCB | Integrated Annual Report 2022

30.1 Retail bonds

Maturing in 2023:

During October 2009, UCB completed a public offering

of € 750 million fixed rate bonds, carrying a coupon and

an effective interest rate of 5.75% per annum, and aimed at

retail investors.

During September 2013, UCB launched an unconditional

public exchange offer for a maximum of € 250 million out of

the € 750 million retail bonds maturing in November 2014 and

having a gross coupon of 5.75%. The existing bondholders had

the opportunity to exchange their existing bonds against newly

issued bonds maturing October 2023 in an exchange ratio of

1 to 1. These bonds carry a coupon of 5.125% per annum while

their effective interest rate is 5.398% per annum.

At the end of the exchange period, 175 717 existing bonds

were tendered in the exchange offer, representing a nominal

amount of € 176 million.

The 175 717 new bonds were issued in October 2013 and

have been listed on Euronext Brussels. The existing bonds

exchanged in the exchange offer were cancelled by UCB. The

outstanding 574 283 of the retail bonds matured and have

been redeemed in November 2014.

30.2 Institutional Eurobonds

Maturing in 2028:

In March 2021, UCB completed an offering of € 500 million

senior unsecured bonds, due in 2028, issued under its EMTN

program. The Bonds were issued at 99.751% in March 2021

and will be redeemed at 100% of their principal amount. These

bonds carry a coupon of 1.00% per annum while their

effective interest rate is 1.1231% per annum. The bonds have

been listed on Euronext Brussels.

30.3 EMTN notes

Maturing in 2027:

In October 2020, UCB completed an offering of

€ 150 million notes, due in 2027. The notes were issued

at 100% and will be redeemed at 100% of their principal

amount. These notes carry a coupon of 1.00% per annum

while their effective interest rate is 1.0298% per annum. The

notes have been listed on Euronext Brussels.

30.4 Fair value hedges

The Group designates derivative financial instruments

under fair value hedges to the Retail Bonds and Institutional

Eurobonds. The change in the carrying amount of the

bonds is fully attributable to the change in the fair value of

the hedged portion of the bonds, and is almost fully offset

by a change in fair value of the corresponding derivative

financial instrument.

31. Other financial liabilities

Carrying amount Fair value

€ million Note 2022 2021 2022 2021

Non-current

Derivative financial instruments 

99 12 99 12

Other financial liabilities

0 0 0 0

Total non-current other financial liabilities

99 12 99 12

Current

Derivative financial instruments 

117 98 117 98

Other financial liabilities

0 2 0 2

Total current other financial liabilities

117 100 117 100

Total other financial liabilities

216 112 216 112

The other financial liabilities include a liability of € 2 million related to factoring of receivables in 2021.

264 265

32. Deferred tax assets and liabilities

32.1 Recognized deferred tax assets and liabilities

€ million 2021

Acquisition/

Disposals

acquisition

R&D

Adjustment

Current Year

Movement

OCI – Cash

flow hedges

OCI –

Pensions

Effect of

movements

in exchange

rate

2022

Intangible assets

- 531 - 400 7 0 42 0 0 - 33 - 915

Property, plant

and equipment

- 18 0 0 0 - 2 0 0 - 1 - 21

Inventories

367 3 0 0 - 22 0 0 0 348

Trade and other

receivables

56 0 0 0 - 19 0 0 - 4 33

Employee benefits

34 0 0 0 - 8 0 - 13 - 1 12

Provisions

4 0 0 0 - 2 0 0 0 2

Other short-term

liabilities

- 55 4 0 0 185 - 13 0 3 124

Net lease assets/

liabilities

0 0 0 0 0 0 0 0 0

Unused tax losses

166 183 - 4 0 - 170 0 0 1 176

Unused tax credits

479 24 0 28 88 0 0 1 620

Total net deferred

tax assets/

liabilities (-)

501 - 186 3 28 92 - 13 - 13 - 33 379

€ million 2020

Acquisition/

Disposals

acquisition

R&D

Adjustment

Current Year

Movement

OCI – Cash

flow hedges

OCI –

Pensions

Effect of

movements

in exchange

rate

2021

Intangible assets

- 508 0 0 0 14 0 0 - 36 - 531

Property, plant

and equipment

- 19 0 0 0 1 0 0 0 - 18

Inventories

353 0 0 0 13 0 0 0 367

Trade and other

receivables

52 0 0 0 4 0 0 0 56

Employee benefits

46 0 0 0 - 2 0 - 11 0 34

Provisions

9 0 0 0 - 5 0 0 0 4

Other short-term

liabilities

- 175 0 0 0 81 33 0 7 - 55

Net lease assets/

liabilities

1 0 0 0 - 1 0 0 0 0

Unused tax losses

241 0 0 0 - 83 0 0 7 166

Unused tax credits

437 0 0 42 - 1 0 0 2 479

Total net deferred

tax assets/

liabilities (-)

437 0 0 42 21 33 - 11 - 21 501

266 267

UCB | Integrated Annual Report 2022

Total net deferred tax assets of € 379 million have been

recognized on December 31, 2022. Based upon the level of

past taxable income and projected future taxable profits over

the periods in which the deductible temporary differences are

estimated to reverse, the Group believes it is probable that the

benefits of the recognized deferred tax assets will be realized.

In line with applicable guidelines, a reasonable measurement

period and approach (taking into account the function and the

risk profile of the relevant taxable entity) has been evaluated in

order to recognize deferred tax positions.

The Group saw an increase of the deferred tax asset exceeded

by an increase of the deferred tax liability balances resulting

in a net deferred tax asset decrease. This is driven by the

following items:

• Zogenix, Inc. acquisition: a deferred tax liability was recorded

on the Intangibles assets acquired in the framework of the

Zogenix, Inc. acquisition, which has been partially offset with a

deferred tax asset on Zogenix, Inc.’s tax attributes.

• Utilization and remeasurement: tax losses carried forward

have been offset against taxable profit in key entities and

additional tax attributes have been recognized based upon the

level of projected future taxable profits driven by reorganization

and acquisition transactions. Additionally, a deferred tax liability

on loss recapture was largely reversed.

• R&D tax credit: refund received versus further build-up of R&D

tax credit deferred tax assets following R&D investments and

the acquisition of Zogenix, Inc. Additional tax credits have been

recognized on tax attributes in Belgium, Germany and the U.S.

Other items are a result of the movements on UCB’s statement

of financial position items (such as inventory and intangibles),

reassessment following tax law changes and reassessment of

non-EUR denominated deferred tax balances.

Tax Reforms

Impact of tax law and tax rate changes, mainly in U.K. and U.S.,

were assessed by management and remeasurement of the

deferred tax balances took place as appropriate.

One notable development are the new U.S. regulations (IRC §174),

applicable as from 2022, requiring capitalization of R&D expenses.

Deferred tax assets on tax credits

The group recorded deferred tax assets on tax credits. The total

deferred tax asset in respect of R&D tax credits at year end is

€ 512 million (2021: € 448 million) which will result in a cash tax

benefit in the future. Other tax credits for € 108 million relate

to dividend received deduction available in Belgium, interest

deduction in Germany and the deferred tax asset resulting from

the new U.S. regulations on capitalization of R&D expenses.

Deferred tax assets on losses

UCB has seen a substantial utilization of tax losses carried

forward, partially compensated by a decrease of deferred tax

liabilities. In addition, UCB recognized deferred tax assets on

the acquired Zogenix, Inc. tax attributes. A deferred tax asset

of € 176 million (2021: € 166 million) was recognized in respect

of tax losses carried forward totaling € 798 million (2021:

€ 683 million) as the Group has concluded that the relevant

entities will generate taxable profits in the foreseeable future

against which these losses can be used and forecasts are

deemed reliable taking into account the profile of the concerning

entities and potential restrictions that could be available. These

losses have arisen in jurisdictions in which UCB operates and do

not expire. This period has seen no further recognition of losses

and tax credits previously unrecognized. Undiscounted forecasts

have been used to assess the availability of future taxable profits.

32.2 Unused tax losses

As of December 31, 2022, the Group also had € 4 143 million

(2021: € 3 284 million) of gross unused tax losses and

innovation income deduction for which no deferred tax asset is

recognized in the statement of financial position. Based on the

current legislation, these tax attributes do not expire.

Based on current forecasts and current legislation, the majority

of these tax attributes is expected to be fully utilized within the

next 10 years. Management is currently assessing the impact of

the international (OECD) tax reform.

32.3 Temporary differences for which no deferred tax asset

or deferred tax liability is recognized

Deferred tax assets are recognized on temporary differences

carried forward that represent income likely to be realized

in the foreseeable future. Deferred tax assets amounting to

€ 84 million gross / € 21 million net (2021: € 300 million gross/

€ 75 million net) in respect of dividend received deduction

and intangible assets have not been recognized in view of the

uncertain character of the recovery.

No deferred tax liabilities are recognized for taxable

temporary differences arising on investments in subsidiaries

as 100% participation exemption is available for any future

equity upstream.

There is an additional unrecognized deferred tax liability

of € 54 million (2021: € 98 million) in respect of an internal

reorganization which occurred in 2014. The tax liability will only

materialize on disposal of the relevant asset, an event which is

controlled by UCB and for which there are no concrete plans in

the foreseeable future.

32.4 Deferred tax directly recognized in OCI

€ million 2022 2021

Deferred tax on pensions

- 13 - 10

Deferred tax on gains financial assets at FVOCI

4 - 4

Deferred tax on effective portion of changes in fair value of cash flow hedges

- 17 37

Deferred tax directly recognized in OCI

- 26 23

266 267

33. Employee benefits

Most employees are covered by retirement benefit plans

sponsored by Group companies. The nature of such plans

varies according to legal regulations, fiscal requirements and

economic conditions of the countries in which the employees

are employed. The Group operates both defined contribution

plans and defined benefit plans.

33.1 Defined contribution plans

Post-employment benefit plans are classified as “defined

contribution” plans if the Group pays fixed contributions into

a separate fund or to a third party financial institution and

has no further legal or constructive obligation to pay further

contributions. Therefore no assets or liabilities are recognized

in the Group statement of financial position in respect of

such plans, apart from regular prepayments and accruals of

contributions. For the Belgian defined contribution plans, UCB

is required by law to guarantee a minimum return on employee

and employer contributions. As a consequence, these plans are

considered defined benefit plans. Where reliable estimates can

be made for material plans, they are valued using the projected

unit credit method under IAS 19. These plans are aggregated

with the results for other defined benefit plans.

33.2 Defined benefit plans

The Group operates several defined benefit plans. The benefits

granted include mainly pension benefits and jubilee premiums.

The benefits are granted according to local market practice

and regulations.

These plans are either unfunded or funded via outside pension

funds or insurance companies. For (partially) funded plans,

the assets of the plans are held separately in funds under the

control of the trustees. Where a plan is unfunded, notably

for the major defined benefit plans in Germany, a liability for

the obligation is recorded in the Group statement of financial

position. For funded plans, the Group is liable for the deficits

between the fair value of the plan assets and the present

value of the benefit obligations. Accordingly, a liability (or an

asset when the plan is over-funded) is recorded in the Group

consolidated statement of financial position. Independent

actuaries assess all main plans annually.

For UCB, the main risks linked to its defined benefit obligations

are discount rate, inflation and longevity. The majority of the

risks lays within Belgium, Switzerland, Germany and the U.K. It

should be noted that longevity is not considered as a risk for the

plans in Belgium as benefits are either paid as a lump sum or

externalized before being paid as an annuity.

As part of its global risk management, UCB carries out an

annual global risk analysis for the defined benefit plans located

in its main countries (Belgium, Switzerland, Germany and

the U.K.) and assesses the risk of deterioration of the financial

position considering the Value-at-Risk.

Over the years, UCB has performed various de-risking projects.

• In the U.K., the remaining Celltech Pension and Insurance

Scheme has as focus to de-risk the investment progressively

from a 50% growth/50% bonds allocation to a 10% growth/90%

bonds allocation. Today the growth/bonds allocation is around

30%/70%. To better manage discount rate and inflation risks,

the Scheme has also over the years gradually increased the

hedging of both interest rates and inflation to around 90%.

• In Belgium, UCB implemented a de-risking strategy by closing

all Belgian defined benefit and cash balance plans to new

entrants as from December 31, 2019 and by implementing a

new cash balance plan with an effective date of January 1, 2020

with the legally required guaranteed return. The focus remains

on the diversification of the assets and investment managers

while keeping a close control on risk.

The amount recognized in the consolidated statement of

financial position arising from the Group’s obligation in respect

of its defined benefit plan is as follows:

€ million Note 2022 2021

Present value of defined benefit obligation

906 1 230

Fair value of plan assets

- 759 - 941

Funded status – Deficit

147 289

Net liability arising from defined benefit obligation

147 289

Add: Liability with respect to cash settled share based payments 

14 26

Total employee benefit liabilities

161 315

Of which:

Portion recognized in non-current liabilities

162 315

Portion recognized in non-current assets

0 0

268 269

UCB | Integrated Annual Report 2022

88% of the net liability arising from defined benefit obligations

is related to defined benefit pension obligations in Belgium,

Germany and the U.K.

Movements in the present value of the defined benefit

obligation in the current year were as follows:

€ million 2022 2021

At January 1

1 230 1 196

Current service cost

66 66

Interest expense

15 11

Remeasurement gain(-)/loss

Effect of changes in demographic assumptions

- 1 - 2

Effect of changes in financial assumptions

- 404 - 61

Effect of experience adjustments

48 20

Past service cost and gain(-)/loss on settlements

- 1 0

Effect of change in foreign exchange rates

- 5 25

Benefit payments from the plan

- 38 - 19

Benefit payments from the employer

- 4 - 4

Plan participants contributions

4 4

Other

- 4 - 6

At December 31

906 1 230

Movements in the fair value of plan assets in the current year were as follows:

€ million 2022 2021

At January 1

941 816

Interest income

12 8

Remeasurement gain/loss(-)

Return on plan assets (excl. interest income)

- 211 53

Effect of change in foreign exchange rates

- 5 23

Plan participants contributions

4 4

Employer contributions

67 68

Benefit payments from the plan

- 42 - 24

Expenses, taxes and premiums paid

- 7 - 7

At December 31

759 941

268 269

€ million

2022 2021

Total service cost (incl. past service cost and gain (-)/loss from settlements)

65 66

Net interest cost

3 3

Remeasurement of other long term benefits

- 2 0

Administrative expenses and taxes

2 1

Components of defined benefit costs recorded in income statement

68 70

Remeasurements gain (-)/loss

Effect of changes in demographic assumptions

- 1 - 2

Effect of changes in financial assumptions

- 402 - 61

Effect of experience adjustments

48 20

Return on plan assets (excluding interest income)

211 - 53

Changes in asset ceiling/onerous liability (excluding interest income)

0 - 1

Components of defined benefit costs recorded in OCI

- 144 - 97

Total components of defined benefit cost

- 76 - 27

The total service cost, the net interest expense, the

remeasurement of other long term benefits, administrative

expenses and taxes for the year are included in the employee

benefit expenses in the consolidated income statement. 81%

of the defined benefit costs recorded in the income statement

are relating to defined benefit pension plans in Belgium and

U.K. The remeasurement on the net defined benefit liability is

included in the statement of comprehensive income as part of

other comprehensive income. Total remeasurements amount

to a gain of € 144 million in 2022 compared to € 97 million in

2021. As in 2021, the gain in 2022 is mainly resulting from a

higher return on plan assets and increase in discount rates.

The actual return on plan assets is € - 211 million (2021:

€ 53 million) and the actual return on reimbursement rights is

€ 0 million (2021: € 0 million).

The split of the recognized expense by functional

line is as follows:

€ million 2022 2021

Cost of sales

21 21

Marketing and selling expenses

7 8

Research and development expenses

25 26

General and administrative expenses

14 15

Other income and expenses

1 0

Total

68 70

The fair value of plan assets amounts to € 759 million (2021:

€ 941 million), representing 84% (2021: 77%) of the defined

benefit obligation. The total deficit of € 147 million (2021:

€ 289 million) is expected to be eliminated over the estimated

remaining average service period of the current membership.

The amounts recognized in the consolidated income

statement and in the consolidated statement of

comprehensive income in respect of those defined benefit

plans are as follows:

270 271

UCB | Integrated Annual Report 2022

The major categories of plan assets at the end of the reporting period, are as follows:

€ million 2022 2021

Cash and cash equivalent

12 16

Equity instruments

222 257

Europe

50 71

U.S.

55 65

Rest of the World

117 121

Debt instruments

273 379

Corporate bonds

86 151

Government bonds

42 53

Other

145 175

Properties

38 23

Qualifying insurance policies

91 106

Investment funds

119 160

Other

2 0

Total

757 941

Virtually all equity and debt instruments have quoted

prices in active markets. Properties can be classified as

Level 3 instruments based on the definitions in IFRS 13 Fair

Value Measurement.

The assets held in the funds do not contain any direct

investment in UCB Group shares, nor any property occupied

by, or other assets used by the Group, though this does not

exclude UCB shares being included in mutual investment fund

type investments.

The principal weighted average actuarial assumptions used for

the purposes of the actuarial valuations were as follows:

Eurozone U.K. Other

2022 2021 2022 2021 2022 2021

Discount rate

4.15% 1.24% 4.90% 1.80% 2.01% 0.30%

Inflation

2.00% 1.75% 3.00% 2.90% N/A N/A

Significant actuarial assumptions for the determination of the

defined obligation are discount rate and inflation. The sensitivity

analyses below have been determined based on reasonably

possible changes of the assumptions occurring at the end of

the reporting period.

• If the discount rate would be 50 basis points higher

(lower), the defined benefit obligation would decrease by

€ 58 million (increase by € 64 million) if all other assumptions

were held constant.

• If the inflation rate would increase (decrease) by 25 basis

points, the defined benefit obligation would increase by

€ 24 million (decrease by € 23 million) if all other assumptions

were held constant.

The figures above do not take account of any interrelationship

between the assumptions, especially between the discount

rate, expected salary increases and inflation rates.

The Group’s subsidiaries should fund the entitlements

expected to be earned on a yearly basis. Funding usually

follows local actuarial requirements and in this framework, the

discount rate is set on a risk-free rate.

Underfunding linked to past service are met by setting

up recovery plans and investment strategies considering

liability profiles, appropriate time periods for amortization

of past service liability, local regulations and the affordability

of the company.

The average duration of the benefit obligation at the end of the

reporting period is 15.80 years (2021: 16.00 years). This number

can be subdivided into the duration related to:

• Eurozone: 11.60 years (2021: 14.10 years);

• U.K.: 17.50 years (2021: 18.70 years);

• Other: 15.60 years (2021: 19.50 years).

The Group expects to make a contribution of € 70 million to

the defined benefit plans during the next financial year.

270 271

ALM (asset-liability management) studies are typically

performed every 3 years. Within those studies, investment

strategies are analyzed in terms of risk-and-return profiles in

order to establish or validate a strategic investment allocation.

An ALM study will be completed in Switzerland in 2023. In

Belgium, an ALM study was performed in 2021, which resulted

in a slight adjustment of the assets portfolio.

In setting up the long-term investment strategy of the scheme,

the investment committee focuses on some key principles

defined by the Group such as:

• maintaining a balance between level of contributions

acceptable to UCB and the level of investment risk relative to

the liabilities;

• reducing the volatility through investment diversification;

• the degree of investment risk should depend on the financial

state of the schemes and liability profiles; and

• ensuring compliance with local funding regulations

where applicable.

34. Provisions

The movements in provisions have been disclosed below:

€ million Environment Restructuring Other Total

At January 1, 2022

12 11 248 271

Arising during the year

3 11 127 141

Unused amounts reversed

0 0 - 20 - 20

Transfer from one heading to another

0 0 3 3

Effect of movements in exchange rates

0 0 3 3

Utilized during the year

0 - 8 - 29 - 37

At December 31, 2022

15 14 332 361

Non-current portion

15 0 156 171

Current portion

0 14 176 190

Total provisions

15 14 332 361

34.1 Environmental provisions

UCB has retained certain environmental liabilities which were

mainly related to the divestiture of Films (2004) and Surface

Specialties (2006). These liabilities relate to the divested sites

on which UCB has retained full responsibility in accordance

with contractual terms. The increase of the environmental

provisions mainly stems from additional amounts related to the

Films business in Belgium. In 2022 a part of the provisions was

used to cover actual expenses incurred.

34.2 Restructuring provisions

The restructuring provisions arising during 2022 are related to

further optimization of business models. The utilization is also

mainly related to earlier reorganizations in Europe.

34.3 Other provisions

Other provisions relate mainly to:

• provisions for litigations that comprise mainly provisions where

UCB or a subsidiary is or might be a defendant against claims of

previous employees;

• product liability provisions that pertain to the risks related

to the normal course of business and for which the Group

might be liable by selling these kinds of drugs. UCB is currently

defendant in several product liability cases in France in

respect of Distilbène, a former product of the UCB Group.

The claimants in these actions claim that their mothers took

Distilbène during their pregnancy and that as a result of this they

suffered bodily injuries (see Note 43.3). The provision in respect

of Distilbène decreased by € 6 million to a total of € 118 million

(2021: decreased by € 9 million to a total of € 124 million) to

reflect the net estimated future cash outflows. The provision

was discounted using a discount rate of 2.96% (2021: 0.11%). If

the discount rate would be 25 basis points lower, the provision

would increase by € 2 million, at 0% discount rate the provision

would increase by € 31 million;

• provisions for restoration costs for leased buildings

due to the adoption of IFRS 16 (€ 8 million) (2021:

€ 8 million) (see Note 40);

• provisions in respect of the recoverability of non-income

tax receivables;

• ongoing claims and disputes to the extend that at balance

sheet date, a present obligation exists and could be

reliably measured;

• new provision related to the strategic decision to terminate the

development in ITP. The termination costs are € 46 million. The

provision decreased by € 13 million to a total of € 33 million due

to utilization.

An assessment is performed with respect to the above-

mentioned risks together with the Group legal advisers and

experts in the different domains.

** Prescribing information varies depending on regulatory approval in each country.

272 273

UCB | Integrated Annual Report 2022

35. Trade and other liabilities

€ million 2022 2021

Other payables

119 86

Total non-current trade and other liabilities

119 86

€ million 2022 2021

Trade payables

573 596

Invoices to receive

50 81

Taxes payable, other than income tax

15 31

Payroll and social security liabilities

274 267

Other payables

203 82

Deferred income linked to development agreements

193 228

Other deferred income

8 14

Royalties payables

29 90

Rebates/discounts and other sales allowances payable

899 901

Accrued interest

34 11

Other accrued expenses

214 254

Total current trade and other liabilities

2 492 2 555

The vast majority of the trade and other liabilities are classified

as current and consequently the carrying amounts of the

total trade and other liabilities is assumed to be a reasonable

approximation of fair value.

“Rebates/discounts and other sales allowances payable”

include rebates, chargebacks, discounts and accruals for

product returns relating to products sold in the U.S. to various

customers that are part of commercial and governmental

contractual arrangements or other reimbursement programs,

including the U.S. Medicaid Drug Rebate program, the U.S.

Federal Medicare program and others. The sales returns and

allowances are recorded in the same period as the underlying

sales as a deduction to sales.

Per management assessment, the total accruals for these

items are adequate, based upon currently available information

and interpretation of relevant regulations.

As these deductions are based on management estimates,

the actual deductions might differ from these estimates.

Such differences could impact the accruals recognized

in the statement of financial position in future periods and

consequently the level of sales recognized in the income

statement in future periods, as there is often a time lag of

several months between the recording of the estimate and the

final accounting of the sales deductions.

The accruals are reviewed and adjusted regularly in light

of contractual and legal obligations, historical trends, past

experience and projected market conditions.

All returns, chargebacks, rebates and discounts that are not

mentioned on the invoice are estimated, deducted from

sales and presented on the statement of financial position

in the appropriate accrual account. The estimate for future

product returns is based on several factors, including: historical

return rates, expiration date by product, return rate by closed

batches, actual returns processed among others, as well as

any other specifically-identified anticipated returns due to

known factors such as the loss of patent exclusivity, product

recalls and discontinuances, or a changing competitive

environment. Adjustments to these accruals may be required

in the future based on revised estimates to our assumptions,

which would have an impact on our consolidated results of

operations. The U.S. sales return and allowance liability that is

included as part of the rebates and discounts payable liability

balance amounts to € 726 million as per December 31, 2022

(December 31, 2021: € 761 million).

The other payables include an amount of € 135 million for the

payment of the contingent value right of US$ 2 per share to the

former shareholders of Zogenix Inc, that was acquired by UCB

on March 7, 2022, as well as to the holders of the convertible

notes of Zogenix as these were all converted after the closing

of the acquisition (see Note 8 and Note 45).

272 273

36. Income tax payables

Income tax payables include liabilities for uncertain tax

positions for an amount of € 145 million (2021: € 157 million).

The uncertain tax positions balance has decreased over 2022

and is composed of the reversal of some risks in key countries

partially compensated by the remeasurement of existing and

the setup of new uncertain tax positions (also including risks

from the Zogenix, Inc. acquisition). Liabilities for uncertain tax

positions are recorded when the Group considers it probable

that a tax position taken is unlikely to be sustained if challenged

by the tax authorities and after exhausting all legal remedies.

The income tax receivable includes assets for tax relief

following Mutual Agreement procedures for an amount of

€ 27 million (2021: € 27 million). Assets for relief following

Mutual Agreement procedures are recorded when the Group

considers it probable that a Mutual Agreement procedure

may provide for a corresponding adjustment in one or

more jurisdictions.

The assessment for both the uncertain tax positions and

corresponding adjustments is calculated taking into account

the most likely outcome (for corporate income tax related

matters) or the expected value (for corporate tax or transfer

pricing related matters), where appropriate and in line with

IFRIC 23. See Note 4.2.5 for more details on the Group’s

assessment of uncertain tax positions. On a net basis, the group

has provided for a reserve of € 119 million (2021: € 130 million)

to cover for uncertain tax positions and engages into the

necessary procedures to secure tax relief where possible.

UCB faces tax audits in a number of countries where activities

are deployed. The issues under discussion are in some cases

complex and such audits can take a number of years to resolve.

The Group strictly follows up on the liabilities for uncertain tax

positions which are recorded per end 2022, also reflecting the

status of the ongoing tax audits.

274 275

UCB | Integrated Annual Report 2022

37. Note to the consolidated statement of cash flows

The cash flow statement identifies operating, investing and

financing activities for the period.

UCB uses the indirect method for the operating cash flows.

The net profit and loss is adjusted for:

• the effects of non-cash transactions such as depreciation and

amortization, impairment losses, provisions, mark-to-market,

etc., and the variance in working capital;

• items of income or expense associated with investing or

financing cash flows.

Important non-cash transactions for 2022 mainly relate to

acquired working capital from acquisitions (€ 65 million) and

tax credits (€ 117 million) for which the cash benefit will be

received in later years.

Important non-cash transactions for 2021 mainly relate to

tax credits (€ 108 million) for which the cash benefit will be

received in later years and to CTA on liquidated entities that

were transferred to the income statement (€ 11 million).

€ million

Note 2022 2021

Adjustment for non-cash transactions

752 239

Depreciation and amortization , , 

589 323

Impairment / reversal (-) charges , 

4 6

Equity settled share based payment expense

- 20 12

Other non-cash transactions in the income statement

- 117 - 120

Adjustment IFRS 9 

35 - 71

(Un)realized exchange gain (-) / losses

124 51

Change in provisions and employee benefits

73 31

Change in inventories and bad debt provisions

64 7

Adjustment for items to disclose separately under operating cash flow

91 170

Tax charge of the period from continuing operations 

91 170

Adjustment for items to disclose under investing and financing cash flow

58 41

Gain (-) / loss on disposal of fixed assets

- 1 3

Interest income (-) / expenses

59 38

Change in working capital

Inventories movement per consolidated statement of financial position

- 29 - 24

Trade and other receivable and other assets movement per consolidated

statement of financial position

162 - 247

Trade and other payable movement per consolidated statement of

financial position

- 173 431

As it appears in the consolidated statement of financial position and corrected by:

- 40 160

Non-cash items

88 37

Change in inventories and bad debt provisions disclosed separately under operating cash flow

- 64 - 7

Currency translation adjustments

- 40 - 37

As it appears in the consolidated cash flow statement

- 56 153

1 Non-cash items are mainly linked to transfers from one heading to another, non-cash movements linked to stock rewards.

274 275

38. Financial instruments by category

December 31, 2022

€ million Note

Assets at

amortized cost

Assets at fair value

through the profit

and loss (FVPL)

Assets used for

hedging

Assets at fair value

through other

comprehensive

income (FVOCI)

Total

Assets as per statement

of financial position

Financial assets and other assets

(excluding derivative financial

instruments and associates)



255 0 0 181 436

Derivative financial assets 

0 29 123 0 152

Trade and other receivables

(including prepaid expenses)



1 051 0 0 0 1 051

Cash and cash equivalents 

899 0 0 0 899

Total

2 205 29 123 181 2 538

December 31, 2022

€ million Note

Liabilities

at fair value

through the profit

and loss (FVPL)

Liabilities used

for hedging

Liabilities at

amortized cost

Total

Liabilities as per statement

of financial position

Borrowings 

0 0 2 177 2 177

Bonds 

- 99 0 822 723

Derivative financial liabilities 

153 64 0 217

Trade and other liabilities 

0 0 2 611 2 611

Other financial liabilities

(excluding derivative financial

instruments)



- 1 0 0 - 1

Total

53 64 5 610 5 727

276 277

UCB | Integrated Annual Report 2022

December 31, 2021

€ million Note

Assets at

amortized cost

Assets at fair value

through the profit

and loss (FVPL)

Assets used

for hedging

Assets at fair value

through other

comprehensive

income (FVOCI)

Total

Assets as per statement

of financial position

Financial assets and other assets

(excluding derivative financial

instruments and associates)



225 0 0 179 404

Derivative financial assets 

0 58 12 0 70

Trade and other receivables

(including prepaid expenses)



1 239 0 0 0 1 239

Cash and cash equivalents 

1 263 0 0 0 1 263

Total

2 727 58 12 179 2 976

December 31, 2021

€ million Note

Liabilities

at fair value

through the profit

and loss (FVPL)

Liabilities used

for hedging

Liabilities at

amortized cost

Total

Liabilities as per statement

of financial position

Borrowings 

0 0 1 307 1 307

Bonds 

- 5 0 821 816

Derivative financial liabilities 

41 69 0 110

Trade and other liabilities 

0 0 2 641 2 641

Other financial liabilities

(excluding derivative financial

instruments)



3 0 0 3

Total

39 69 4 769 4 877

276 277

39. Derivative financial instruments

Assets Liabilities

€ million Note 2022 2021 2022 2021

Forward foreign exchange contracts – cash flow hedges

31 11 36 69

Forward foreign exchange contracts – fair value

through profit and loss

25 50 60 29

Foreign exchange options – net investment hedges

54 0 26 0

Interest rate derivatives – cash flow hedges

38 1 2 0

Interest rate derivatives – fair value through profit and loss

4 8 93 12

Total

152 71 217 110

Of which:

Non-current , 

28 9 99 12

Current , 

123 61 117 98

The full fair value of a hedging derivative is classified as a non-

current asset or liability if the remaining maturity of the hedged

item is more than 12 months, and as a current asset or liability, if

the maturity of the hedged item is less than 12 months.

The cash flow hedges entered into by the Group were assessed

to be highly effective and over 2022, a net unrealized gain

of € 87 million (2021: net unrealized loss of € 141 million)

after deferred taxes was included in equity in respect of

these contracts. These gains/losses will be recycled to the

profit or loss in the period during which the hedged forecast

transactions affect the profit or loss.

The ineffective portion recognized in the profit or loss

that arises from cash flow hedges amounts to € 0 million

(2021: € 0 million).

39.1 Foreign currency derivatives

The Group policy with respect to the use of financial derivative

contracts is described in Note 5 “Financial Risk Management”.

The Group entered into several forward foreign exchange

contracts in order to hedge a portion of highly probable future

sales and royalty income, expected to occur in 2021 and 2022.

The fair values of the foreign currency derivative contracts

are as follows:

Assets Liabilities

€ million

2022 2021 2022 2021

USD

63 44 52 92

GBP

0 2 0 0

JPY

6 7 6 1

CHF

0 7 0 0

Other currencies

41 2 64 5

Total foreign currency derivatives

110 62 122 98

The net foreign currency derivatives maturity analysis is noted below:

€ million 2022 2021

1 year or less

- 11 - 37

1 – 5 years

0 0

Beyond 5 years

0 0

Total foreign currency derivatives – net asset/net liability (-)

- 11 - 37

278 279

UCB | Integrated Annual Report 2022

The following table shows the split of foreign currency derivatives by currency of denomination (currencies sold view) as at

December 31, 2022:

Notional amounts in € million USD GBP EUR JPY CHF

Other

currencies Total

Forward contracts

54 64 905 12 4 46 1 085

Currency swaps

3 464 12 2 942 309 29 254 7 010

Option/collar

0 0 0 0 0 0 0

Total

3 518 76 3 847 321 33 300 8 095

39.2 Interest rate derivatives

The Group uses various interest rate derivative contracts

to manage its exposure to interest rate movements on

its borrowings. The re-pricing dates and amortization

characteristics are aligned with those of the fixed rate

bonds. The outstanding interest rate derivative contracts

are as follows:

Contract

Type

For periods

Receivable

Currency

Receivable

Notional Receivable Rate

Payable

Currency

Payable

Notional Payable Ratefrom to

IRS Jul 2, 2020 Jul 3, 2023 USD 450 SOFR + 0.10% USD 450 0.56%

IRS Oct 2, 2016 Oct 2, 2023 EUR 175 1.91% EUR 175 EURIBOR 3M

CCIRS Oct 3, 2016 Oct 2, 2023 EUR 205 EURIBOR 3M USD 230

LIBOR USD 3M

+ 0.155%

CCIRS Oct 3, 2016 Oct 2, 2023 USD 230

LIBOR USD 3M

+ 0.445%

EUR 205 EURIBOR 3M

IRS Jan 3, 2023 Jan 2, 2025 USD 300 SOFR USD 300 4.52%

IRS Jun 8, 2022 Mar 10, 2025 USD 200 SOFR USD 200 2.07%

IRS Dec 8, 2022 Dec 8, 2025 USD 200 SOFR USD 200 4.17%

IRS Jul 8, 2022 Mar 9, 2026 USD 200 SOFR USD 200 2.96%

IRS Dec 8, 2023 Dec 8, 2026 USD 150 SOFR USD 150 3.77%

IRS Jul 8, 2022 Mar 8, 2027 USD 200 SOFR USD 200 1.84%

IRS Apr 1, 2021 Oct 1, 2027 EUR 150 - 0.25% EUR 150 EURIBOR 6M

IRS Mar 30, 2021 Mar 30, 2028 EUR 500 - 0.22% EUR 500 EURIBOR 6M

39.3 Hedge of net investment in a foreign entity

Any unrealized cumulative foreign exchange gains or losses

resulting from net investment hedges are taken up under

Cumulative Translation Adjustments. These unrealized gains

and losses will remain in equity and will only be recycled

to profit or loss when the Group no longer holds the

underlying assets.

278 279

40. Leases

40.1 Amounts recognized in the statement of financial position

The statement of financial position shows the following amounts relating to leases:

€ million Note 2022 2021

Buildings 

118 122

Plant and machinery 

1 0

Office equipment and vehicles 

41 32

Total right-of-use assets

160 154

Non-current 

100 97

Current 

41 39

Total lease liabilities

141 136

Additions to the right-of-use assets during the 2022 financial year were € 39 million.

As per December 31, 2022, no residual value guarantees are included in the lease liabilities.

As per December 31, 2022, no lease commitments for leases not yet commenced.

40.2 Amounts recognized in the income statement

The income statement shows the following amounts relating to leases:

€ million Note 2022 2021

Depreciation charge of right-of-use assets 

48 44

Buildings 

27 24

Plant and machinery 

1 1

Office equipment and vehicles 

21 19

Interest expense (included in Financial expenses) 

4 3

Expense relating to short-term leases

3 4

Expense relating to leases of low-value assets that are not short-term leases

10 8

Total expense related to leases

65 59

The total cash outflow for leases in 2022 was € 46 million. In 2022 there was no material income from subleasing.

280 281

UCB | Integrated Annual Report 2022

41. Earnings per share

41.1 Basic earnings per share

€ 2022 2021

From continuing operations

2.21 5.59

From discontinued operations

- 0.01 0.01

Basic earnings per share

2.20 5.60

Basic earnings per share is calculated by dividing the profit

attributable to shareholders of the Company by the weighted

average number of ordinary shares in issue during the year,

excluding ordinary shares purchased by the Company and held

as treasury shares.

41.2 Diluted earnings per share

€ 2022 2021

From continuing operations

2.15 5.44

From discontinued operations

- 0.01 0.01

Diluted earnings per share

2.14 5.45

Diluted earnings per share is calculated by dividing the profit

attributable to shareholders of the Company by the weighted

average number of ordinary shares in issue during the year,

excluding ordinary shares purchased by the Company and held

as treasury shares, adjusted by the number of dilutive potential

ordinary shares attached to the issuance of stock options, stock

awards and performance shares.

The number of dilutive potential ordinary shares is calculated

based on the average number of stock options outstanding

during the reporting period as the difference between the

average market price of ordinary shares during the reporting

period and the weighted average exercise price of the stock

options and on the average number of stock awards and

performance shares outstanding during the reporting period.

Stock options only have a dilutive effect when the average

market price is above the exercise price (stock options are

“in the money”).

For the purpose of calculating dilutive earnings per share,

there were no adjusting elements to the profit attributable to

shareholders of the Company.

41.3 Earnings

The calculation of the basic and diluted earnings per share attributable to the ordinary equity holders of the parent is based on the

following data:

Basic

€ million 2022 2021

Profit/loss (-) from continuing operations attributable to shareholders of UCB SA

420 1 056

Profit/loss (-) from discontinued operations

- 2 3

Profit attributable to shareholders of UCB SA

418 1 058

Diluted

€ million 2022 2021

Profit/loss (-) from continuing operations attributable to shareholders of UCB SA

420 1 056

Profit/loss (-) from discontinued operations

- 2 3

Profit attributable to shareholders of UCB SA

418 1 058

41.4 Number of shares

In thousands of shares 2022 2021

Weighted average number of ordinary shares for basic earnings per share

189 619 188 973

Weighted average number of ordinary shares for diluted earnings per share

194 834 194 177

280 281

42. Dividend per share

The gross dividends paid in 2022 (in respect of the year ended

December 31, 2021) and 2021 (in respect of the year ended

December 31, 2020) were € 247 million (€ 1.30 per share) and

€ 240 million (€1.27 per share) respectively.

A dividend in respect of the year ended December 31, 2022 of

€ 1.33 per share, amounting to a total dividend of € 252 million,

is to be proposed at the annual general meeting of the

shareholders on April 27, 2023.

In accordance with IAS 10, events after the reporting period,

the proposed dividend has not been recognized as a

liability at year-end.

43. Commitments and contingencies

43.1 Capital and other commitments

At December 31, 2022, the Group has committed to spend

€ 120 million (2021: € 131 million) mainly with respect to

expected capital expenditures for the new Gene -Therapy

plant, the new biological production unit, the warehouse

extension, lab and other equipment and office refurbishment

works on the Braine site (Belgium).

UCB has entered into long-term development agreements with

various pharmaceutical enterprises, clinical trial operators and

financial investors. Such collaboration agreements may include

milestone payments which are dependent on successful

clinical development or on meeting specified sales targets.

The table below sets out the maximum that would be paid if

all milestones, however unlikely, are achieved but excludes

variable royalty payments based on unit sales and amounts

accrued for milestones already achieved. The amounts are not

risk-adjusted or discounted, and the timing of the payments is

based on the Group’s current best estimate of achievement of

the relevant milestones.

€ million 2022 2021

Less than 1 year

43 46

Between 1 and 5 years

508 275

More than 5 years

852 805

Total

1 404 1 126

UCB has concluded several agreements with Contract

Manufacturing Organizations for the supply of its products.

Total outstanding commitments towards these CMOs

amount to € 589 million as per end of 2022 until 2032 (2021:

€ 563 million until 2031). If contractually agreed milestones,

mainly dependent on future successful clinical development,

are reached, this amount of contingent payments may increase

to € 799 million.

As part of UCB’s innovation strategy, UCB has established a

corporate venture fund, UCB Ventures. The main objectives of

the fund are to add breadth to UCB’s innovation ecosystem,

to create a window on new technologies, products, platforms

and channels to augment or complement UCB’s existing

activities, to develop network and strategic relationships in the

venture capital investor community to identify opportunities

that UCB might not otherwise see. Within this framework

UCB has outstanding commitments at the end of 2022 for

a total amount of € 30 million relating to investments in

venture capital funds.

43.2 Guarantees

Guarantees arising in the normal course of business are not

expected to result in any material financial loss.

43.3 Contingencies

The Group continues to be actively involved in litigations,

claims and investigations. The ongoing matters could result in

liabilities, civil and criminal penalties, loss of product exclusivity

and other costs, fines and expenses associated with findings

adverse to UCB’s interests. Potential cash outflows reflected

in a provision might be fully or partially off-set by insurance

in certain circumstances. UCB has not established provisions

for potential damage awards for certain additional legal

claims against our subsidiaries if UCB currently believes that a

payment is either not probable or cannot be reliably estimated.

282 283

UCB | Integrated Annual Report 2022

1. Intellectual property matters (selected matters)

We vigorously protect our patent portfolio and our ability

to bring medicines to patients as we deem necessary.

Consequently, UCB is involved in various litigation matters as a

plaintiff in various jurisdictions in the U.S. and Europe.

TOVIAZ

Germany

Inventor compensation dispute whereby two former Schwarz

(predecessor company) inventors have filed complaints against

UCB alleging the assignment of rights under the TOVIAZ

formulation patents is invalid and hence royalties from Pfizer

should be paid to them. In our proceedings against Dr. Bicane,

UCB has prevailed. In the case concerning Dr. Mika UCB's

petition for legal review with the German Supreme Court was

rejected. UCB continues to work with the Düsseldorf Appeal

Board and its independent expert on the appropriate value of

the disputed invention.

VIMPAT

Germany

Inventor compensation dispute whereby two inventors of the

improved lacosamide manufacturing route seek compensation

based on product revenue. A hearing regarding potential

compensation is expected in 2023.

NEUPRO

United States

In 2019, UCB filed separate lawsuits against Actavis and Mylan

to enforce patents covering the stabilized (reformulation)

NEUPRO

**. In 2021, the federal court in the Actavis case

ruled the patent invalid. Shortly thereafter, the federal court in

the Mylan case issued a ruling adverse to UCB. UCB appealed

both rulings. At the request of the parties, the appellate court

consolidated both cases for appeal. Oral argument took place

in September 2022. A decision is expected in 2023.

Europe

In 2018, Mylan and Luye sought to invalidate the NEUPRO

reformulation patent. The judge ruled in UCB’s favor. Luye

appealed. Mylan waived its right to appeal. In October 2022,

the appellate court ruled in UCB’s favor.

In late 2022, the European appeal board heard UCB’s

NEUPRO

** polymorph patent case and invalidated the patent.

BRIVIACT

United States

In 2021, 8 generic companies filed Abbreviated New Drug

Applications (ANDAs) related to a BRIVIACT

** patent. UCB

filed complaints in Delaware federal court against all 8

companies. Subsequently, one of the companies discontinued

its challenge of our patent and settlement agreements were

reached with 4 defendants. The trial concerning the remaining

3 defendants took place in November 2022. A ruling is

expected in 2023.

NAYZILAM

United States

In 2021, Cipla filed an ANDA challenging the validity of certain

NAYZILAM

** patents. UCB filed a lawsuit against Cipla. Cipla

has stipulated to infringement. A trial is anticipated in 2023.

FINTEPLA

United States

In 2021, two generics companies (Apotex and Lupin) filed

ANDAs challenging the validity of certain FINTEPLA

** patents.

Zogenix, Inc., which was acquired by UCB, filed lawsuits against

both companies. The cases are currently in discovery.

2. Product liability matters

Distilbène product liability litigation – France

Entities of the UCB Group have been named as defendants in

several product liability cases in France. The claimants in these

actions claim their mothers took Distilbène, a former product

of the UCB Group, during their pregnancy, and as a result

they suffered bodily injuries. The Group has product liability

insurance in place but the insurance coverage will likely not

be sufficient. the Group has accounted for a provision (refer to

Note 34 in the 2022 Annual Report).

Opioid Litigation

UCB, Inc. (“UCB”) has been named as a defendant in 15 lawsuits

in connection with the national opioid litigation in the United

States. The plaintiffs are government municipalities, health

care entities, and 1 individual plaintiff claiming damages related

to the promotion, sale and distribution of opioids. UCB has 7

cases in the federal multi-district litigation (MDL) and 8 in Utah

state court. In all cases, UCB is among numerous defendants.

To date, only 1 UCB case in Utah has been selected for a trial to

proceed (Washington County, Utah).

Additionally, Zogenix, Inc., now by UCB, is a defendant in 3

opioid cases. Also, UCB is contractually obligated to indemnify

one of its former contract manufacturers who is currently a

defendant in 4 cases. UCB controls the defense of these cases.

3. Investigations

CIMZIA

** Investigation

In March 2019, UCB, Inc. received a Civil Investigative

Demand (CID) from the U.S. Department of Justice (DOJ)

and a subpoena from the Department of Health and Human

Services (HHS) Office of Inspector General (OIG) both seeking

information relating to the sales and marketing practices and

pricing of CIMZIA

** for the periods from 2011 and 2008,

respectively, to date. In March 2020, UCB was informed

that DOJ was suspending the inquiry initiated by its office in

Georgia. The Company is cooperating fully with DOJ and OIG.

4. 340B Drug Pricing Program

In December 2021, UCB implemented an update to its

Section 340B contract pharmacy policy, whereby UCB

no longer provides 340B discounted products to certain

pharmacies that contract with covered entities participating

in the 340B Drug Pricing Program. UCB strongly supports

the 340B program and is committed to ensuring access to

UCB's medicines for vulnerable and underserved populations.

UCB has therefore elected to continue to provide products

purchased at the 340B price to multiple contract pharmacies

associated with covered entities whose eligibility is based on

their grant status with HRSA and whose mission is consistent

with serving vulnerable and underserved populations. UCB will

also continue to provide products purchased at the 340B price

** Prescribing information varies depending on regulatory approval in each country.

282 283

44. Related party transactions

44.1 Intra-group sales and services

During the financial years ended December 31, 2022 and

2021, all intra-UCB Group transactions were carried out based

on assessments of mutual economic benefit to the parties

involved, and the applicable conditions were established in

accordance with criteria of at arm’s length negotiations and fair

dealing, and with a view to creating value for the entire UCB

Group. Conditions governing intra-UCB Group transactions

were similar to conditions governing third-party transactions.

With regard to the sale of intermediary and finished products,

these criteria were in most cases achieved by increasing each

party’s respective production cost by an at arm’s length profit

margin. With regard to intra-UCB Group services rendered,

these criteria are accompanied by the principle of charging fees

sufficient to cover each party’s respective incurred costs and

an at arm’s length mark-up. Intra-Group transactions carried

out within the UCB Group constitute standard transactions

for a biopharmaceutical Group. These transactions include

the purchase and sale of intermediary and finished medical

products, deposits and loans for UCB Group affiliates as well as

functions and activities carried out by the UCB Group in order

to optimize operations.

44.2 Financial transactions with related parties other than

UCB SA affiliates

During 2022 there have been no financial transactions with

related parties other than affiliates of UCB SA.

44.3 Key management compensation

Key management compensation as disclosed below

comprises compensation recognized in the income

statement for members of the Board of Directors and the

Executive Committee, for the portion of the year where they

exercised their mandate.

2022 2021

Short-term employee benefits

16 18

Post-employment benefits

3 3

Share-based payments

8 6

Total key management compensation

27 27

Short-term employee benefits include salaries (including social

security contributions), bonuses earned during the year, car

leasing and other allowances where applicable. Share-based

compensation includes the amortization over the vesting

period of the fair value of equity instruments granted, and

comprises share options, share awards and performance

shares further explained in Note 28. The termination benefits

contain all compensated amounts, including benefits in

kind and deferred compensation. There have been no loans

granted by the Company or a subsidiary of the Group to any

Director or officer of the Group, nor any guarantees given with

respect hereto.

to pharmacies that are wholly-owned by covered entities and,

for non-federal grantee covered entities without a pharmacy,

UCB will allow the designation of a single contract pharmacy

eligible to receive 340B discounted product.

In 2021 and 2022, the U.S. Department of Health and Human

Services, Health Resources and Services Administration

(HRSA)

sent letters to numerous drug manufacturers stating it had

determined those manufacturers’ actions restricting contract

pharmacy transactions were in violation of the 340B statute.

The letters further stated manufacturers should repay alleged

overcharges, and if they did not cease their restrictions, HRSA

might seek civil monetary penalties. Those manufacturers are

now in litigation with the U.S. government seeking to confirm

the legality of the restrictions.

In June 2022, UCB received a similar letter from HRSA. If

HRSA or another agency were to commence proceedings

against UCB based on the letter, a negative outcome could

have a material adverse effect on UCB’s business, results of

operations, cash flow, prospects and financial condition.

However, consistent with the rulings of several federal district

courts in the manufacturer lawsuits referenced above, UCB

believes its policy does not violate 340B Program requirements

and its 340B policy is consistent with relevant U.S. laws. In order

to confirm HRSA’s letter is based on flawed reasoning and that

UCB’s policy is in compliance with the 340B statute, UCB filed

a lawsuit against HRSA in September 2022. The case has been

stayed pending the outcome of an appeal of a federal district

court ruling addressing two other manufacturers’ challenges

to HRSA’s letters regarding the manufacturers’ 340B contract

pharmacy policies.

284 285

UCB | Integrated Annual Report 2022

44.4 Shareholders and shareholders structure

The main shareholder of UCB is Financière de Tubize SA (also

referred to herein as the “Reference Shareholder” or “Tubize”),

a Belgian company listed on Euronext Brussels, holding

69 440 861 UCB shares on a total number of 194 505 658 (i.e.

35.70%) as at December 31, 2022.

Based on the transparency declarations received by Tubize

and, as the case may be, more recent public disclosures, the

shareholder structure of Tubize per December 31, 2022 can be

summarized as follows:

Concert Outside concert Total

Voting rights % Voting rights % Voting rights %

FEJ SRL

8 525 014 19.15% 1 988 800 4.47% 10 513 814 23.62%

Daniel Janssen

5 881 677 13.21% 0 0.00% 5 881 677 13.21%

Altaï Invest SA

4 969 795 11.16% 40 205 0.09% 5 010 000 11.26%

Barnfin SA

3 903 835 8.77% 0 0.00% 3 903 835 8.77%

Jean van Rijckevorsel

11 744 0.03% 0 0.00% 11 744 0.03%

Total voting rights held by

the reference shareholders

23 292 065 52.33% 2 029 005 4.56% 25 321 070 56.89%

Other shareholders

0 0.00% 19 191 528 43.11% 19 191 528 43.11%

Total voting rights

23 292 065 52.33% 21 220 533 47.67% 44 512 598 100.00%

Altaï Invest SA is controlled by Evelyn du Monceau, born Evelyn

Janssen. Barnfin SA is controlled by Bridget van Rijckevorsel,

born Paule Bridget Janssen.

The reference shareholders of Tubize, belonging to the

Janssen family, act in concert, i.e. they have entered into a

shareholders’ agreement concerning the concerted exercise

of their voting rights in order to pursue a sustainable common

policy with regard to Tubize and concerning the possession,

acquisition or transfer of voting securities cf. article 3, §1, 13°, a),

b) and c) of the Law on the disclosure of large shareholdings

and article 3, §1, 5°, a) and b) of the Law on public takeover bids.

UCB also holds UCB shares (see below for an overview of its

shareholdings at December 31, 2022). The remaining UCB

shares are held by the public.

Please find below an overview of the large shareholdings of

UCB (including assimilated financial instruments) on the basis

of the transparency notifications received pursuant to the

law of May 2, 2007, on the disclosure of large shareholdings

(situation as at December 31, 2022):

284 285

UCB Controlling and major shareholdings on December 31, 2021

Situation as per December 31, 2021

Share capital (€)

€ 583 516 974 March 13, 2014

Total number of voting rights (= denominator)

194 505 658 March 13, 2014

1 Financière de Tubize SA (“Tubize”)

securities carrying voting rights (shares)

69 440 861 35.70% July 31, 2022

2 UCB SA/NV

securities carrying voting rights (shares)

4 910 760 2.52% December 31, 2022

assimilated financial instruments (options)

0 0.00% March 6, 2017

assimilated financial instruments (other)

0 0.00% December 18, 2015

Total    .%

Free float

(securities carrying voting rights (shares))

120 154 037 61.77%

3 Wellington Management Group LLP

securities carrying voting rights (shares)

15 166 845 7.80% May 13, 2022

4 BlackRock, Inc.

securities carrying voting rights (shares)

9 412 6 91 4.84% January 13, 2020

5 FMR LLC

securities carrying voting rights (shares)

7 509 016 3.86% August 1, 2022

Percentages are calculated on the basis of the current total number of voting rights.

1 Assimilated financial instruments within the meaning of article 6, §6 of the Law of May 2, 2007 on the disclosure of large shareholdings.

2 Free float being the UCB shares not held by the reference shareholder (Tubize) and UCB SA/NV. Only securities carrying voting rights (shares) held by these entities are taken into

account for this calculation; assimilated financial instruments are excluded.

45. Events after the statement of financial position date

At the end of January 2023, UCB sold an established brands

portfolio of five prescription medicines, commercialized in

Europe. The portfolio is comprised of pharmaceutical products

in a variety of non-core therapeutic categories.

On 8 February 2023, UCB’s FINTEPLA

** (fenfluramine)

oral solution has been approved in the European Union for

the treatment of seizures associated with Lennox-Gastaut

syndrome (LGS) as an add-on therapy to other anti-epileptic

medicines for patients two years of age and older. This approval

triggers the payment of the contingent value right of US$ 2

per share to the former shareholders of Zogenix Inc., that was

acquired by UCB on March 7, 2022, as well as to the holders

of the convertible notes of Zogenix, Inc. as these were all

converted after the closing of the acquisition. These contingent

value rights amount to US$ 145 million in total.

** Prescribing information varies depending on regulatory approval in each country.

286 287

UCB | Integrated Annual Report 2022

46. UCB Companies (fully consolidated)

Name and office Holding Majority controlling shareholder

Armenia

Nile AI LLC – 15 Nar Dos, 1st Lane – Yerevan 100% Nile AI, Inc.

Australia

UCB Australia Pty. Ltd. – Level 1, 1155 Malvern Road – 3144 Malvern, Victoria 100% UCB SA

Engage Therapeutics Australia Pty. Ltd., Level 1, 1155 Malvern Road –

3144 Malvern, Victoria

100% Engage Therapeutics, Inc.

Austria

UCB Pharma Gesellschaft m.b.H. – Twin Tower, Wienerbergstrasse 11/12a – 1100

Wien

100% UCB Pharma SA

Belgium

UCB Fipar SA – Allée de la Recherche, 60 – 1070 Brussels (BE0403.198.811) 100% UCB Belgium SA

UCB Biopharma SRL – Allée de la Recherche, 60 – 1070 Brussels

(BE0543.573.053)

100% UCB Pharma SA

UCB Belgium SA – Allée de la Recherche, 60 – 1070 Brussels (BE0402.040.254) 100% UCB Pharma SA

UCB Pharma SA – Allée de la Recherche, 60 – 1070 Brussels (BE0403.096.168) 100% UCB SA

Sifar SA – Allée de la Recherche, 60 – 1070 Brussels (BE0453.612.580) 100% UCB Pharma SA

UCB Ventures SA – Allée de la Recherche, 60 – 1070 Brussels (BE0667 816 096) 100% UCB SA

UCB Ventures Belgium SA – Allée de la Recherche, 60 – 1070 Brussels

(BE0668 388 891)

100% UCB Ventures SA

Brazil

UCB Biopharma Ltda – Av. Presidente Juscelino Kubitschek, nº 1327, 5° andar,

Condominio Edificio Intemacional Plaza II – CEP: 04543 – 011 Sao Paulo

100% UCB SA

Bulgaria

UCB Bulgaria EOOD – 2B Srebarna street, fl. 9, office 8B, Lozenetz, Sofia 1407 100% UCB SA

Canada

UCB Canada Inc. – 2201 Bristol Circle, Suite 602 – ON L6H0J8 Oakville 100% UCB Holdings, Inc.

China

UCB Trading (Shanghai) Co Ltd – Suite 317, 439 No.1 Fu Te Road West,

Shanghai (Pilot Free Trade Zone)

100% UCB SA

UCB Pharma (Hong Kong) Ltd – Rooms 156 & 157, 20/F, Cityplaza Three, 14

Taikoo Wan Road – Tai Koo, Hong Kong

100% UCB Pharma GmbH

UCB Pharma (Zhuhai) Company Ltd – Section A., Workshop,

No.3 Science & Technology 05th Road, Innovation Coast, National Hi-Tech

Industrial Development Zone – Zhuhai Guangdong Province

100% UCB Pharma GmbH

Czech Republic

UCB S.R.O. – Jankovcova 1518/2 – 170 00 Praha 7 100% UCB SA

Denmark

UCB Nordic AS – Edvard Thomsens Vej 14, 7 – 2300 Copenhagen 100% UCB Pharma SA

286 287

Name and office Holding Majority controlling shareholder

Finland

UCB Pharma Oy Finland – Bertel Jungin aukio 5 , 6.krs – 02600 Espoo 100% UCB Pharma SA

France

UCB Pharma SA – Défense Ouest 420, rue d’Estienne d’Orves – 92700 Colombes 100% UCB SA

Zogenix SAS

2, 3

– 26 rue Cambacérès – 75008 Paris 100% UCB Pharma SA (FR)

Germany

UCB Pharma GmbH – Alfred-Nobel-Strasse 10 – 40789 Monheim am Rhein 100% UCB GmbH

UCB GmbH – Alfred-Nobel-Strasse 10 – 40789 Monheim am Rhein 100% UCB Pharma SA

UCB BioSciences GmbH – Alfred-Nobel-Strasse 10 – 40789 Monheim am Rhein 100% UCB Pharma GmbH

Cosmix Verwaltungs GmbH – Alfred-Nobel-Strasse 10 –

40789 Monheim am Rhein

100% Ra Pharmaceuticals, Inc.

Zogenix GmbH

– Altheimer Eck 6 – 80331 Munich 100% UCB Pharma GmbH

Greece

UCB A.E. – 63 Agiou Dimitriou Street – 17456 Alimos – Athens 100% UCB SA

Hungary

UCB Hungary Ltd – Obuda Gate Building Arpád Fejedelem ùtja 26 – 28 – 1023

Budapest

100% UCB SA

India

UCB India Private Ltd – Building No. – P3, Unit No. – 103, 1st Floor,

Prithvi Complex, Kalher Pipe Line, Kalher, Bhiwandi, Thane – 421302 Maharashtra

100% UCB SA

Ireland

UCB (Pharma) Ireland Ltd – United Drug House Magna Drive,

Magna Business Park, City West Road – Dublin 24

100% UCB SA

UCB Manufacturing Ireland Ltd – United Drug House Magna Drive,

Magna Business Park, City West Road – Dublin 24

100% UCB SA

Zogenix ROI Limited

– Trinity House, Charleston Road – Ranelagh,

Dublin 6, D06 C8X4

100% Zogenix International Limited

Italy

UCB Pharma SpA – Via Varesina 162 – 20156 Milano 100% UCB SA

Zogenix S.r.l.

– Via Varesina 162 – 20156 Milano 100% Zogenix International Limited

Japan

UCB Japan Co Ltd – Shinjuku Grand Tower, 8-17-1 Nishi-Shinjuku 160-0023

Shinjuku, Tokyo

100% UCB SA

Zogenix Japan KK

2, 3

–1–1–1 Uchisaiwaicho, Chiyoda-ku, Tokyo, 100-0011, Japan 100% UCB Japan

Mexico

UCB de Mexico SA de C.V. – Calzada Mariano Escobedo 595, Piso 3,

Oficina 03/100, Colonia Rincón del Bosque, Bosque de Chapultepec I sección,

Alcaldía Miguel Hidalgo, 11589 Mexico D.F.

100% UCB SA

Vedim SA de C.V. 1 – Calzada Mariano Escobedo 595, Piso 3, Oficina 03/100,

Colonia Rincón del Bosque, Bosque de Chapultepec I sección,

Alcaldía Miguel Hidalgo – 11589 Mexico D.F.

100% UCB SA

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UCB | Integrated Annual Report 2022

Name and office Holding Majority controlling shareholder

Netherlands

UCB Pharma B.V. (Netherlands) – Hoge Mosten 2 – 4822 NH Breda 100% UCB Pharma SA

Norway

UCB Pharma A.S. – Haakon VIIs gate 6 – 0161 Oslo 100% UCB Pharma SA

Poland

Vedim Sp. z.o.o. – Ul. L. Kruczkowskiego, 8, 00 – 380 Warszawa 100% UCB SA

UCB Pharma Sp. z.o.o. – Ul. L. Kruczkowskiego, 8, 00 – 380 Warszawa 100% UCB SA

Portugal

UCB Pharma (Produtos Farmaceuticos) Lda – Rua do Silval, nº 37, piso 1, S1.3,

2780-373 Oeiras

100% UCB SA

Romania

UCB Pharma Romania S.R.L. – 165 Calea Floreasca, One Tower Building,

3rd Floor, 1st district – Bucharest 14459

100% UCB SA

Russia

UCB Pharma LLC – Shturvaluaya 5 bldg 1 – 125364 Moscow 100% UCB SA

UCB Pharma Logistics LLC – 1st Krasnogvardeyskiy proezd 15, floor 13, office 2,

room 35, premises 1 – 123100 Moscow

100% UCB SA

South Korea

UCB Korea Co Ltd. – 4th Fl., A+ Asset Tower, 369 Gangnam-daero,

Seocho-gu – 06621 Seoul

100% UCB SA

Spain

UCB Pharma SA – Plaza de Manuel Gómez Moreno, s/n, Edificio Bronce, 5th

floor – 28020 Madrid

100% UCB SA

Zogenix Espana S.L

– Calle Jose Ortega y Gasset 22-24, 3rd Floor – 28006 Madrid 100% UCB Pharma SA (ES)

Sweden

UCB Pharma AB (Sweden) – Mäster Samuelsgatan 60 – 111 21 Stockholm 100% UCB Pharma SA

Switzerland

UCB Farchim SA (A.G.– Ltd.) – ZI de Planchy, Chemin de Croix Blanche 10 –

1630 Bulle

100% UCB Pharma SA

Doutors Réassurance SA – ZI de Planchy, Chemin de Croix Blanche 10 – 1630 Bulle

100% UCB Farchim SA

UCB-Pharma AG – ZI de Planchy, Chemin de Croix Blanche 10 – 1630 Bulle 100% UCB Farchim SA

UCB Medical Devices SA – ZI de Planchy, Chemin de Croix Blanche 10 – 1630 Bulle

100% UCB Farchim SA

Taiwan

UCB Pharmaceuticals (Taiwan) Ltd – 12F.-2, No.88, Dunhua N. Rd.,

Songshan Dist – 10551 Taipei

100% UCB SA

Turkey

UCB Pharma A.S. – Palladium Tower, Barbaros Mah., Kardelen Sok. No.2,

Kat.24/80 –34746 Istanbul

100% UCB SA

288 289

Name and office Holding Majority controlling shareholder

U.K.

UCB (Investments) Ltd – 208 Bath Road – SL1 3WE Slough, Berkshire 100% UCB SA

Celltech Group Ltd – 208 Bath Road – SL1 3WE Slough, Berkshire 100% UCB (Investments) Ltd

Celltech R&D Ltd – 208 Bath Road – SL1 3WE Slough, Berkshire 100% Celltech Group Ltd

Darwin Discovery Ltd – 208 Bath Road – SL1 3WE Slough, Berkshire 100% Celltech Group Ltd

UCB Pharma Ltd – 208 Bath Road – SL1 3WE Slough, Berkshire 100% Celltech Group Ltd

Zogenix Europe Limited

– 208 Bath Road – SL1 3WE Slough, Berkshire 100% Zogenix, Inc.

Zogenix International Limited

– The Pearce Building West Street, SL6 1RL

Maidenhead, Berkshire

100% Zogenix Europe Limited

Ukraine

UCB Ukraine LLC – 19 Grygoriya Skovorody Str., Business – center ”Podol Plaza”

– 04070 Kiyv

100% UCB Pharma GmbH

U.S.

UCB Holdings, Inc. – Corporation Trust Center, 1209 Orange Street –

19801 Wilmington, Delaware

100% UCB Pharma SA

UCB, Inc. – Corporation Trust Center, 1209 Orange Street –

19801 Wilmington, Delaware

100% UCB Holdings, Inc.

UCB Biosciences, Inc. – Corporation Trust Center, 1209 Orange Street –

19801 Wilmington, Delaware

100% UCB, Inc.

UCB Manufacturing, Inc. – Corporation Trust Center, 1209 Orange Street –

19801 Wilmington, Delaware

100% UCB, Inc.

Element Genomics, Inc.

– Corporation Trust Center, 1209 Orange Street – 19801

Wilmington, Delaware

100% UCB Biosciences, Inc.

Ra Pharmaceuticals, Inc. – Corporation Trust Center, 1209 Orange Street –

19801 Wilmington, Delaware

100% UCB Holdings, Inc.

Engage Therapeutics, Inc. – Corporation Trust Center, 1209 Orange Street –

19801 Wilmington, Delaware

100% UCB Holdings, Inc.

Nile Al, Inc. – Corporation Trust Center, 1209 Orange Street –

19801 Wilmington, Delaware

100% UCB Holdings, Inc.

Zogenix, Inc.

– Corporation Trust Center, 1209 Orange Street –

19801 Wilmington, Delaware

100% UCB Biosciences, Inc.

Zogenix MDS, Inc.

– Corporation Trust Center, 1209 Orange Street –

19801 Wilmington, Delaware

100% Zogenix, Inc.

1 Element Genomics, Inc (U.S.) and Vedim SA de C.V. (Mexico) have merged respectively with UCB Biosciences, Inc. and UCB de Mexico S.A. de C.V. on January 1, 2022 and are included in

the Consolidated Income Statement for 2021. Handl Therapeutics BV has merged with UCB Biopharma SRL on July 1, 2021.

2 These Companies have been acquired on March 7, 2022: Zogenix, Inc. (U.S.), Zogenix MDS, Inc. (U.S.), Zogenix KK (Japan), Zogenix Europe Limited (U.K.), Zogenix International Limited

(U.K.), Zogenix GmbH (Germany), Zogenix S.r.l. (Italy), Zogenix SAS (France), Zogenix Espana S.L. (Spain), Zogenix ROI Limited (Ireland).

3 Zogenix KK (Japan) and Zogenix SAS (France) have merged respectively with UCB Japan Co. Ltd on July 1, 2022 and UCB Pharma S.A. (France) November 30, 2022 and are included in

Consolidation Income Statement for 2022 until the merger took place.

290 PB

UCB | Integrated Annual Report 2022

4. Responsibility statement

We hereby confirm that, to the best of our knowledge, the

consolidated financial statements as of December 31, 2022,

prepared in accordance with International Financial Reporting

standards (IFRS), as adopted by the European Union, and with

the legal requirements applicable in Belgium, give a true and

fair view of the assets, liabilities, financial position and profit

or loss of the company and the undertakings included in the

consolidation as a whole, and that the management report

includes a fair review of the development and performance

of the business and the position of the company and the

undertakings included in the consolidation taken as a

whole, together with a description of the principal risks and

uncertainties that they face.

Signed by Jean-Christophe Tellier (CEO) and

Sandrine Dufour (CFO)

on behalf of the Board of Directors

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UCB | Integrated Annual Report 2022

5. Statutory auditor’s report

We present to you our statutory auditor’s report in the context

of our statutory audit of the consolidated accounts of UCB SA

(the “Company”) and its subsidiaries (jointly “the Group”). This

report includes our report on the audit of the consolidated

accounts, as well as the report on other legal and regulatory

requirements. These reports form part of an integrated whole

and are indivisible.

We have been appointed as statutory auditor by the general

meeting of 29 April 2021, following the proposal formulated by

the board of directors and following the recommendation by

the audit committee and the proposal formulated by the works’

council. Our mandate will expire on the date of the general

meeting which will deliberate on the consolidated accounts

prepared on 31 December 2023. We have performed the

statutory audit of the consolidated financial statements of the

Company for two consecutive years.

Report on the consolidated accounts

Unqualified opinion

We have performed the statutory audit of the Group’s

consolidated accounts, which comprise the consolidated

statement of financial position as at 31 December 2022, the

consolidated income statement, the consolidated statement

of comprehensive income, the consolidated statement of

changes in equity and the consolidated statement of cash

flows for the year then ended, and notes to the consolidated

financial statements, including a summary of significant

accounting policies and other explanatory information, and

which is characterised by a consolidated statement of financial

position total of € 15 868 million and a profit for the year

(attributable to equity holders) of € 418 million.

In our opinion, the consolidated accounts give a true and

fair view of the Group’s net equity and consolidated financial

position as at 31 December 2022 and of its consolidated

financial performance and its consolidated cash flows for the

year then ended, in accordance with International Financial

Reporting Standards (“IFRS”) as adopted by the European

Union and with the legal and regulatory requirements

applicable in Belgium.

Basis for unqualified opinion

We conducted our audit in accordance with International

Standards on Auditing (ISAs) as applicable in Belgium. Our

responsibilities under those standards are further described

in the “Statutory auditor’s responsibilities for the audit of the

consolidated accounts” section of our report. We have fulfilled

our ethical responsibilities in accordance with the ethical

requirements that are relevant to our audit of the consolidated

accounts in Belgium, including the requirements related

to independence.

We have obtained from the board of directors and Company

officials the explanations and information necessary for

performing our audit.

We believe that the audit evidence we have obtained is

sufficient and appropriate to provide a basis for our opinion.

Key audit matters

Key audit matters are those matters that, in our professional

judgment, were of most significance in our audit of the

consolidated accounts of the current period. These matters

were addressed in the context of our audit of the consolidated

accounts as a whole, and in forming our opinion thereon, and

we do not provide a separate opinion on these matters.

292 293

Significant judgements and estimates in sales rebates,

discounts and returns adjustments recognised in the US

Refer to Notes 3.7.1, 4.2.1 and 35

Description of the Key Audit Matter

In the US, the UCB Group sells products to various customers

that are part of commercial and governmental contractual

arrangements or other reimbursement programmes (Medicaid,

Medicare or equivalent scheme). This process leads to

significant adjustments to the gross sales in the form of rebates,

chargebacks, discounts and product returns. We identified

this matter as a key audit matter because significant amounts

of these unsettled adjustments are recorded as accruals in

the balance sheet at year-end. The process for determining

these accruals is complex and depends on contract terms and

regulation, as well as forecasts of sales volumes by channel

and estimates on expected returns of products. As disclosed in

Note 35, the amount of the accruals at 31 December 2022 is

€ 726 million (€ 761 million as per 31 December 2021).

How our audit addressed the Key Audit Matter

Our testing focused on the accruals for sales rebates,

chargebacks, discounts and product returns recognised at

the year-end as the process for these accruals involves the

use of large volumes of data, regarding sales volumes and

discounts from multiple sources, which, taken together,

require significant management judgement in a complex US

healthcare environment.

We obtained management’s calculations of the accruals for

sales rebates, chargebacks, discounts and product returns and

tested the inputs into the accrual calculations. We performed

the following procedures:

• We assessed the completeness and accuracy of the accruals

by understanding and testing the process management used to

calculate and record the year-end balances.

• We tested the mathematical accuracy of the year-end balances

and compared such amounts to our own independently

developed expectations (substantive analytics). Our

independent expectations were developed based on sales

figures, historical rebate invoices received, adjusted for current

volumes, rebate rates as included in sales contracts and

agreements with third parties and adjusted for any Company or

industry specific factors.

• We assessed the key judgements and assumptions within

management’s analysis and we considered other known

factors such as generic entrants and government, legal

or regulatory information, as applicable. We assessed the

assumptions used to determine the standard lag times for

commercial rebates, Medicare rebates, Medicaid rebates, cash

discounts, chargebacks and returns.

• We examined third party statements and external data,

we sampled rebate and chargeback invoices processed

subsequently to year end and we assessed management’s

estimates of channel inventory.

• We benchmarked with peers (listed and non-listed).

• We performed back-testing that compared accruals

recognised in previous periods to actual rebates, chargebacks,

discounts or returns received in order to test management’s

historical accuracy in calculating these accruals.

In determining the appropriateness of the revenue recognition

policy in accordance with IFRS 15 applied by management in

calculating sales rebates, chargebacks, discounts and product

returns under contractual and regulatory requirements,

there is room for judgement. We did not identify any

material differences between our independent expectations

and the accruals and we found the judgements made by

management to be reasonable. Also, the policies applied are

consistent in all material respects with IFRSs as adopted by the

European Union.

Carrying value of goodwill and intangible assets

Refer to Notes 3.10, 3.14, 3.15, 4.2, 14, 20 and 21

Description of the Key Audit Matter

The UCB Group has € 4 816 million of intangible assets (31

December 2021 – € 3 159 million), comprising significant

licenses, patents and acquired trademarks, and € 5 340 million

of goodwill at 31 December 2022 (31 December 2021 –

€ 5 173 million).

The carrying values of goodwill and intangible assets are

contingent on future cash flows and if these cash flows do

not meet the Group’s expectations, there is risk that the

assets will be impaired. The impairment reviews performed

by the Group contain a number of significant judgements

and estimates including revenue growth, the success of new

product launches, patent expiry dates, profit margins, terminal

values and discount rate. Changes in these assumptions might

lead to a change in the carrying value of intangible assets and

goodwill. We therefore determined that this matter was of most

significance in our audit.

As indicated in Note 21, the Group operates in one segment

and has therefore one single cash-generating unit (“CGU”),

Biopharmaceuticals, for goodwill impairment testing purposes.

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UCB | Integrated Annual Report 2022

How our audit addressed the Key Audit Matter

We obtained the UCB Group’s impairment evaluation analyses

and performed the following procedures:

• We tested the reasonableness of the methodology and the key

assumptions, including profit and cash flow growth, terminal

values, the impact of the expiry of patents, pricing impacts,

potential product obsolescence, the probability of success for

pipeline products and the selection of discount rates.

• We have assessed management’s substantiation of its

assumptions, including comparing relevant assumptions to

industry and economic forecasts. In doing this, we worked with

our internal valuation specialists.

• We have also evaluated the process to prepare the Group’s

strategic plan that was approved by UCB’s Board of Directors.

• We obtained and evaluated management’s sensitivity analyses

to ascertain the impact of reasonably possible changes in

key assumptions and we performed our own independent

sensitivity calculations to quantify the downside changes to

management’s models required to result in impairment.

• We also assessed the reasonability of the forecasted discounted

cash flows by comparing those to the Group’s market

capitalisation.

Management’s review of the recoverable amounts of the

Group’s assets did not result in the recognition of impairment

charges in 2022 (see Note 14). As a result of our work,

we concur with this position. In addition, we found that

management’s judgements were supported by reasonable

assumptions that would require unreasonable downside

changes before any material impairment was necessary.

In respect of the Biopharmaceuticals CGU, we confirmed

that this is the lowest level at which management monitors

goodwill for internal purposes, that it is consistent with how

the Group’s results and financial position are reported to the

executive committee and the board of directors and that it thus

complies with IFRS as adopted by the European Union.

Zogenix, Inc acquisition

Refer to Note 8

Description of the Key Audit Matter

On the 7th March 2022, UCB successfully completed

the acquisition of Zogenix, Inc. (Zogenix) that is now a

wholly owned subsidiary of UCB. This acquisition resulted

in a business combination under IFRS 3. Former Zogenix

shareholders received USD 26 in cash for each Zogenix share

plus a contingent value right (CVR) for a potential cash payment

of USD 2.00 upon EU approval by December 31, 2023, of

FINTEPLA

**, resulting in a total cash consideration paid of

€ 1.5 billion excluding post-closing settlement of convertible

debt in a separate transaction (converted from USD as at

acquisition date).

The purchase price allocation (PPA) was completed by UCB

with the support of management's expert. The main items

resulting from the PPA comprised of intangible assets (mainly

related to FINTEPLA

**) and goodwill.

As part of the purchase price allocation, a deferred tax liability

has been recorded on the intangible assets as the fair value of

the assets within this acquisition should reflect the tax benefits

the entity would receive had the assets been tax deductible in

accordance with IFRS 3.

We identified the Zogenix Inc acquisition as a key audit matter

because the fair value measurement of its goodwill, intangible

assets and deferred taxes is based on significant judgements

and estimates including projected cash flows, revenue growth,

the success of FINTEPLA

** as an orphan medicinal product

for treatment of seizures associated with Lennox-Gastaut

syndrome, patent expiry dates, profit margins, and discount

rate. Changes in these assumptions might lead to a change in

the fair value of goodwill, intangible assets and deferred taxes.

How our audit addressed the area of focus

We have performed the following procedures over

the acquisition:

• Identification and inspection of the key documents, terms and

conditions of the transaction (due diligence reports, clinical

trials results, agreements and contracts) and of the acquired

company (historical financial statements, SEC filings, stock

option plans, …);

• Audit procedures over the opening balance of Zogenix at the

date of acquisition and its integration in UCB systems;

• Review of the hedging documentation in relation with the

financing of the acquisition;

• Review of the IFRS accounting treatment of the acquisition in

accordance with IFRS, and of related disclosures.

We obtained the UCB Group’s PPA and tested the

reasonableness of the valuation approaches and methods

as well as the key assumptions, including profit and cash

flow projections, the impact of the expiry of patents, pricing

impacts, the probability of success for FINTEPLA

** as an

orphan medicinal product for treatment of seizures associated

with Lennox-Gastaut syndrome and the selection of the

discount rate. We have assessed management’s substantiation

of its assumptions, including comparing relevant assumptions

to industry and economic forecasts. In doing this, we worked

with our internal valuation specialists. We have evaluated the

process to prepare the key forecast assumptions and assessed

their reasonability.

We obtained and evaluated management’s sensitivity

analyses based on numerous drivers such as indications

penetration, probability of success, pricing premiums, rebates

and discounts, extended release formulations, incremental

competitors, or timeline of launches.

We evaluated management’s assumptions regarding

the measurement rate of the deferred tax liability and

assessed the recognition criteria of deferred tax assets in

accordance with IFRS.

Based on the procedures performed, we consider

management’s judgements reasonable and did not identify any

material misstatements. We also evaluated the appropriateness

of the disclosures in Note 8 which we considered appropriate.

** Prescribing information varies depending on regulatory approval in each country.

294 295

Recognition of deferred tax assets and

uncertain tax positions

Refer to Notes 3.12, 4.2.5, 32 and 36

Description of the Key Audit Matter

The UCB Group has significant tax losses from past & current

business performance. There is inherent uncertainty involved

assessing both the availability of losses and tax credits and in

forecasting future taxable profits, which determines the extent

to which deferred tax assets are recognised. Additionally, the

availability and the amount of the tax losses and tax credits can

be impacted by ongoing tax audits.

At 31 December 2022, the Group has recognised

€ 379 million of net deferred tax assets (31 December 2021 –

€ 501 million). The process for the determination of deferred

tax assets is complex and involves a significant amount of

judgement. Consequently, we consider the recognition of

deferred tax assets as significant matter of our audit of the

financial statements.

The group operates in a complex multinational tax environment

and there are open tax and transfer pricing matters with tax

authorities. Judgement is required in assessing the level of

provisions required in respect of uncertain tax positions. We

therefore also consider the provisions for uncertain tax positions

as a key audit matter. At 31 December 2022, the Group has

recognised provisions of € 145 million in respect of uncertain

tax positions (31 December 2021 – € 156 million). Liabilities for

uncertain tax positions are recorded when the Group considers

it probable that a tax position taken is unlikely to be sustained

if challenged by the tax authorities and after exhausting all

legal remedies.

The Group has also recorded income tax receivables for tax

relief following Mutual Agreement procedures for an amount

of € 27 million (31 December 2021 – € 27 million). Assets for

relief following Mutual Agreement procedures are recorded

when the Group considers it probable that a Mutual Agreement

procedure may provide for a corresponding adjustment in one

or more jurisdictions.

As a result of the above, on a net basis, the group has

provided for a reserve of € 119 million (31 December 2021 –

€ 130 million) to cover for uncertain tax positions.

How our audit addressed the Key Audit Matter

We evaluated the appropriateness of the management’s

key assumptions and estimates, in particular the likelihood

of generating sufficient future taxable profits to support the

recognition of deferred tax assets.

We evaluated the possible effects of tax audit outcomes on

the availability of tax losses and tax credits (and the need

for recognizing a provision for uncertain tax positions, if

deemed necessary).

We considered the status of recent and current tax authority

audits, the outcome of previous audits, the judgmental

positions taken in tax returns and current year estimates and

developments in the tax environment.

We assessed and evaluated – together with our tax specialists

– the correspondence with the relevant tax authorities and

certain third party tax opinions. Based on this information,

we analysed and challenged the assumptions used by

management to determine tax provisions. We conclude that

the provisions for uncertain tax positions are recognized in

accordance with IFRIC 23.

We assessed whether the UCB Group’s disclosures about

the sensitivity of the recognition of deferred tax assets to

reasonably possible changes in key assumptions reflected the

associated inherent risks and the disclosures in respect of tax

and uncertain tax positions.

As a result of our work, we determined that management’s

conclusions on the recognition of deferred tax assets and

its recoverability are appropriate. We also determined that

the provisions for uncertain tax positions and the related

disclosures are acceptable.

Ongoing litigations, claims and regulatory investigations

Refer to Notes 3.28, 4.2.3, 34 and 43

Description of the Key Audit Matter

The pharmaceutical industry is a highly regulated industry,

which increases the inherent risk for litigation, claims and

regulatory investigations. The UCB Group is engaged in a

number of legal actions, including product liability, commercial

litigation and regulatory investigations, which could have a

material impact on the financial statements.

The Group complies with the requirements of IAS 37 for the

evaluation and recording of provisions for certain risks. The

recording of a provision or contingent liability in order to

cover the legal risk requires by nature the use of professional

judgment due to the difficulty to estimate the outcome of

litigations that may arise.

Due to the nature of the current procedures against the Group

and given the use of estimation in the determination of the

provisions, we consider the ongoing litigation, claims and

regulatory investigations as a key audit matter.

At 31 December 2022, the Group held provisions of

€ 361 million (31 December 2021 – € 271 million) among others

in respect of actual legal actions brought against the Group

and disclosures have been made in Note 34 in relation to these

provisions, as well as the disclosure of contingent liabilities

in Note 43 relating to ongoing regulatory investigations or

legal claims where the directors believe to have meritorious

defences against the claims.

As disclosed in Notes 34 and 43, the Group is involved

in several product liability cases related to the product

Distilbène. This provision amounted to € 124 million as

at 31 December 2021 and amounts to € 118 million as at

31 December 2022.

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UCB | Integrated Annual Report 2022

How our audit addressed the Key Audit Matter

We have assessed the adequacy of the internal control system

and tested the operating effectiveness of key controls related

to the process of determining the provisions for litigation.

These controls mainly concern the identification of the files

to be provisioned based on the motives of the dispute and the

determination of the amount of the provisions estimated using

the methodologies retained by the Group.

Our audit work has focused on the following:

• We discussed actual or pending legal and regulatory claims

with the Group’s General Counsel to update our understanding

of the status of each case.

• We established our own expectation of the likely outcome and

tested substantively the amount provided (e.g. Distilbène) by

evaluating the assumptions used in measuring the provision

by discussion and by reference to the actual (similar) court

decisions, to available documentation such as correspondence

with external legal counsels and by obtaining independent

confirmations from the external legal counsels.

• We considered the completeness of legal and regulatory

matters through inquiry with the Group’s General Counsel and

by reading minutes of meetings of the executive committee

and the board of directors, and did not identify any other legal

matters that had not already been disclosed to us.

• We evaluated the assumptions regarding the measurement

of the provision related to the Distilbène product liability of

€ 118 million (31 December 2021 – € 124 million) by reference

to the actual court decisions for closed Distilbène cases

and the effect of newly initiated cases in the course of 2022.

We discussed with UCB’s management and assessed the

assumptions used.

Our testing did not identify any material misstatements in

the provisions recorded. We found that in the context of

the Group financial statements, the judgements made by

management and the provisions recorded are reasonable

and the disclosures relating to legal and regulatory matters,

provisions and contingent liabilities in Notes 34 and 43 were in

accordance with the requirements of IFRSs as adopted by the

European Union.

Responsibilities of the board of directors for

the preparation of the consolidated accounts

The board of directors is responsible for the preparation

of consolidated accounts that give a true and fair view in

accordance with International Financial Reporting Standards

as adopted by the European Union and with the legal and

regulatory requirements applicable in Belgium, and for

such internal control as the board of directors determines is

necessary to enable the preparation of consolidated accounts

that are free from material misstatement, whether due to

fraud or error.

In preparing the consolidated accounts, the board of directors

is responsible for assessing the Group’s ability to continue as

a going concern, disclosing, as applicable, matters related

to going concern and using the going concern basis of

accounting unless the board of directors either intends to

liquidate the Group or to cease operations, or has no realistic

alternative but to do so.

Statutory auditor’s responsibilities for the audit

of the consolidated accounts

Our objectives are to obtain reasonable assurance about

whether the consolidated accounts as a whole are free from

material misstatement, whether due to fraud or error, and to

issue an auditor’s report that includes our opinion. Reasonable

assurance is a high level of assurance, but is not a guarantee

that an audit conducted in accordance with ISAs will always

detect a material misstatement when it exists. Misstatements

can arise from fraud or error and are considered material if,

individually or in the aggregate, they could reasonably be

expected to influence the economic decisions of users taken

on the basis of these consolidated accounts.

In performing our audit, we comply with the legal, regulatory

and normative framework applicable to the audit of the

consolidated accounts in Belgium. A statutory audit does not

provide any assurance as to the Group’s future viability nor as to

the efficiency or effectiveness of the board of directors’ current

or future business management at Group level.

As part of an audit in accordance with ISAs, we exercise

professional judgment and maintain professional skepticism

throughout the audit. We also:

• Identify and assess the risks of material misstatement of the

consolidated accounts, whether due to fraud or error, design

and perform audit procedures responsive to those risks, and

obtain audit evidence that is sufficient and appropriate to

provide a basis for our opinion. The risk of not detecting a

material misstatement resulting from fraud is higher than for

one resulting from error, as fraud may involve collusion, forgery,

intentional omissions, misrepresentations, or the override of

internal control.

296 297

• Obtain an understanding of internal control relevant to the

audit in order to design audit procedures that are appropriate

in the circumstances, but not for the purpose of expressing an

opinion on the effectiveness of the Group’s internal control.

• Evaluate the appropriateness of accounting policies used

and the reasonableness of accounting estimates and related

disclosures made by the board of directors.

• Conclude on the appropriateness of the board of directors’

use of the going concern basis of accounting and, based on

the audit evidence obtained, whether a material uncertainty

exists related to events or conditions that may cast significant

doubt on the Group’s ability to continue as a going concern. If

we conclude that a material uncertainty exists, we are required

to draw attention in our statutory auditor’s report to the related

disclosures in the consolidated accounts or, if such disclosures

are inadequate, to modify our opinion. Our conclusions are

based on the audit evidence obtained up to the date of our

statutory auditor’s report. However, future events or conditions

may cause the Group to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content

of the consolidated accounts, including the disclosures,

and whether the consolidated accounts represent the

underlying transactions and events in a manner that achieves

fair presentation.

• Obtain sufficient and appropriate audit evidence regarding the

financial information of the entities or business activities within

the Group to express an opinion on the consolidated financial

statements. We are responsible for the direction, supervision

and performance of the group audit. We remain solely

responsible for our audit opinion.

We communicate with the audit committee regarding, among

other matters, the planned scope and timing of the audit and

significant audit findings, including any significant deficiencies

in internal control that we identify during our audit.

We also provide the audit committee with a statement that we

have complied with relevant ethical requirements regarding

independence, and to communicate with them all relationships

and other matters that may reasonably be thought to bear on

our independence, and where applicable, related safeguards.

From the matters communicated with the audit committee, we

determine those matters that were of most significance in the

audit of the consolidated accounts of the current period and

are therefore the key audit matters. We describe these matters

in our auditor’s report unless law or regulation precludes public

disclosure about the matter.

Other legal and regulatory requirements

Responsibilities of the board of directors

The board of directors is responsible for the preparation

and the content of the director’s report on the consolidated

accounts, the non-financial information and the other

information included in the annual report.

Statutory auditor’s responsibilities

In the context of our engagement and in accordance with the

Belgian standard which is complementary to the International

Standards on Auditing (ISAs) as applicable in Belgium, our

responsibility is to verify, in all material respects, the directors’

report on the consolidated accounts and the other information

included in the annual report, and to report on these matters.

Aspects related to the directors’ report on the consolidated

accounts and to the other information included in

the annual report

In our opinion, after having performed specific procedures in

relation to the directors’ report on the consolidated accounts,

this report is consistent with the consolidated accounts for the

year under audit, and is prepared in accordance with article

3:32 of the Companies’ and Associations’ Code.

In the context of our audit of the consolidated accounts, we

are also responsible for considering, in particular based on

the knowledge acquired resulting from the audit, whether the

directors’ report on the consolidated accounts and the other

information included in the annual report on the consolidated

accounts is materially misstated or contains information which

is inadequately disclosed or otherwise misleading. In light of

the procedures we have performed, there are no material

misstatements we have to report to you.

The non-financial information required by virtue of article 3:32,

§2 of the Companies’ and Associations’ Code is included in the

directors’ report on the consolidated accounts (UCB Group

Integrated Annual Report 2022). The Company has prepared

the non-financial information, based on GRI standards.

However, in accordance with article 3:80, §1, 5° of the

Companies’ and Associations’ Code, we do not express an

opinion as to whether the non-financial information has been

prepared in accordance with the GRI standards as disclosed in

the directors’ report on the consolidated accounts.

296 297

UCB | Integrated Annual Report 2022

Statement related to independence

• Our registered audit firm and our network did not provide

services which are incompatible with the statutory audit of the

consolidated accounts, and our registered audit firm remained

independent of the Group in the course of our mandate.

• The fees for additional services which are compatible with

the statutory audit of the consolidated accounts referred

to in article 3:65 of the Companies’ and Associations’ Code

are correctly disclosed and itemized in the notes to the

consolidated accounts.

European Single Electronic Format (ESEF)

We have also performed, in accordance with the standard

on the audit of compliance of financial statements with the

European Single Electronic Format (hereinafter “ESEF”), the

audit of the compliance of the ESEF format with the technical

regulatory standards defined by the Delegated European

Regulation No. 2019/815 of December 17, 2018 (hereinafter

“Delegated Regulation”).

The Board of Directors is responsible for the preparation, in

accordance with the ESEF requirements, of the consolidated

financial statements as an electronic file in ESEF format

(hereinafter digital consolidated financial statements) included

in the annual financial report.

Our responsibility is to obtain sufficient appropriate

evidence to conclude that the format and XBRL markup of

the digital consolidated financial statements comply, in all

material respects, with the ESEF requirements under the

Delegated Regulation.

Based on our work, we are of the opinion that the format

of and the tagging of information in the digital consolidated

financial statements included in the annual financial report of

the Group as at 31 December 2022 are, in all material respects,

prepared in accordance with the ESEF requirements under the

Delegated Regulation.

Other statements

This report is consistent with the additional report to the

audit committee referred to in article 11 of the Regulation

(EU) N° 537/2014.

Brussels, February 21, 2023

MAZARS RÉVISEURS D’ENTREPRISES SRL

Statutory Auditor

Represented by

Anton NUTTENS

298 PB

6. Abbreviated statutory financial

statements of UCB SA

6.1 Introduction

In accordance with the Belgian Companies Code, it has been

decided to present an abbreviated version of the statutory

financial statements of UCB SA.

The statutory financial statements of UCB SA are

prepared in accordance with Belgian Generally Accepted

Accounting Principles.

It should be noted that only the consolidated financial

statements as presented above, present a true and fair view of

the financial position and performance of the UCB Group.

The statutory auditor has issued an unqualified audit opinion

and certifies that the non-consolidated financial statements

of UCB SA for the year ended December 31, 2022 give a true

and fair view of the financial position and results of UCB SA in

accordance with all legal and regulatory dispositions.

In accordance with the legislation, these separate financial

statements, together with the management report of the Board

of Directors to the general assembly of shareholders, as well as

the auditor’s report will be filed at the National Bank of Belgium

within the statutory periods.

These documents are available on our website www.ucb.com

or on simple request, addressed to:

UCB SA

Corporate Communication

Allée de la Recherche 60

B-1070 Brussels (Belgium)

PB 299

UCB | Integrated Annual Report 2022

6.2 Statement of financial position

€ million 2022 2021

Assets

Formation expenses 

Intangible assets 

Tangible assets 

Financial assets  

8 594

Fixed assets

9 443 8 640

Amounts receivable after more than one year  

1 370

Amounts receivable within one year or less 

329

Current investments 

492

Cash at bank and on hand 

Deferred charges and accrued income 

Current assets

3 542 2 295

Total assets

12 985 10 935

Liabilities

Capital 

584

Share premium  

2 000

Reserves  

6 254

Profit brought forward 

120

Equity

8 913 8 956

Provisions 

Provisions and deferred taxes

25 32

Amounts payable after more than one year  

1 542

Amounts payable within one year or less 

328

Accrued charges and deferred income 

Current liabilities

4 047 1 947

Total liabilities

12 985 10 935

300 301

6.3 Income statement

€ million 2022 2021

Operating income 

Operating charges - 

- 113

Operating result

- 19 - 28

Financial income 

417

Financial charges - 

- 76

Financial result

231 341

Profit before income taxes

212 313

Income taxes - 

Profit for the year available for appropriation

210 313

6.4 Appropriation account

€ million

2022 2021

Profit for the period available for appropriation 

313

Profit brought forward from previous year 

Profit to be appropriated

328 366

Transfer to capital and reserves

0 0

Profit to be carried forward 

120

Result to be carried forward

76 120

Dividends 

246

Profit to be distributed

252 246

If the proposed allocation of the profit is approved, the total gross dividend will be fixed at:

€ 1.33 € 1.30

If the proposed allocation of profit is approved and taking into account the tax regulations, the

total net dividend off withholding tax per share will be fixed at:

€ 0.931 € 0.910

The activities of UCB SA generated in 2022 include

€ 249 million financial income stemming from financial

fixed assets in affiliated enterprises. The net profit reaches

€ 210 million after income taxes. The amount available for

distribution is € 328 million, including € 118 million profits

brought forward from last year.

The issued share capital of UCB SA is represented

by 194 505 658 shares without par value as per

December 31, 2022.

Per December 31, 2022, UCB SA owns 4 910 760 own

shares in order to honour the exercise of share options and

share awards granted to the Board of Directors and certain

categories of employees.

The Board of Directors proposes to pay a gross dividend

of € 1.33 per share. If this dividend proposal is approved by

the General Meeting on April 28, 2023, the net dividend of

€ 0.931 per share will be payable as of May 3, 2023 against the

delivery of coupon #26. The shares held by UCB SA are not

entitled to a dividend.

Per December 31, 2022, 189 594 898 UCB shares are entitled

to a dividend, representing a total distribution of € 252 million.

This amount may fluctuate depending on the number of UCB

shares held by UCB SA on the dividend approval date. The

Board of Directors will communicate at the general meeting

the total number of UCB shares entitled to a dividend and will

submit the aggregate amount to be distributed for approval.

The annual accounts of 2022 will be adapted accordingly.

300 301

UCB | Integrated Annual Report 2022

The Board of Directors made the following decisions

in accordance with the Article 3:6 of the Royal Decree

of April 29, 2019 on implementing the company and

association code.

6.5.1 Tangible assets

Tangible assets purchased from third parties have been

included in the statement of financial position at purchase

price; assets manufactured by the company itself have been

valued at cost. The purchase price or cost is depreciated

on a straight-line basis considering “pro rata temporis”. The

depreciation rates are as follows:

Administrative buildings

Industrial buildings

Tools

15%

Furniture and office machinery

15%

Vehicles

20%

Computer equipment and office machines

33.30%

Prototype equipment

33.30%

6.5.2 Financial assets

UCB shareholdings have been valued in accordance with

the proportion held in shareholders’ equity of the UCB

companies concerned.

Shareholdings not part of the UCB companies are valued at

cost. An impairment is booked whenever the valuation shows a

permanent loss in realizable value.

6.5.3 Receivables and liabilities

They are shown at their book value. Receivables have been

written down if their repayment, when due, is entirely or partly

uncertain and doubtful.

6.5.4 Assets and commitments expressed in

foreign currencies

Foreign currency transactions are accounted for at the

exchange rates prevailing at the date of the transactions.

Non-monetary assets and liabilities (intangible and tangible

assets, shareholdings), denominated in foreign currencies, are

translated at the foreign exchange rate prevailing at the date

of the transaction. Monetary assets and liabilities denominated

in foreign currencies are translated at statement of financial

position date rate. Realized and unrealized exchange

differences on foreign currency transactions are recognized in

the income statement.

6.5.5 Provisions

All the risks born by the company have been the subject of

provisions reviewed each year, in accordance with the rules

of prudence, good faith and sincerity. Provisions are recorded

at normal value.

6.5.6 Foreign currencies

Derivatives are accounted for at fair value through P&L unless

the derivative has no offsetting exposure in the stand-alone

financial statements, in which case, the derivative will only be

disclosed as off-statement of financial position commitment

not affecting the statement of financial position and/or income

statement accounts. The amount disclosed as off-statement

of financial position commitment will be in line with the IFRS

methodology. Additionally, the effective portion of changes

in the fair value of the derivative financial instruments that are

designated and qualify as cash flow hedges, are classified on

the same line in the income statement or statement of financial

position as the hedged item once the hedged item affects

profit or loss or results in the recognition of a non-financial

asset or liability.

6.5.7 Fair value adjustments on loans being acquired

Loans that have been acquired are recognized in the statement

of financial position at nominal value. All differences between

the nominal value and the acquisition value are recognized

on an accrual account and taken in the income statement

pro rata temporis on a linear basis over the remaining

duration of the loans.

6.5 Summary of significant accounting principles

302 PB

Data and

reporting

PB 303

People data

Patient value pillars

2022

Patient value solutions 7 895

PV Early Solutions

741

PV Development Solutions

1 157

PV Immunology Solutions

1 402

PV Neurology Solutions

1 986

PV Supply and Technology Solutions

2 609

Patient value support functions 806

PV Corporate Development and Finance

414

PV Legal and Risk

158

PV Talent and Company Reputation

234

CEO office 2

Total 8 703 (β)

Permanent and fixed-term contracts by region

2022 (β) 2021

Europe

Inter-

national

markets U.S. Total Europe

Inter-

national

markets U.S. Total

Fixed-term contract

144 311 4 459 140 336 4 480

Permanent contract

5 328 1 226 1 690 8 244 5 264 1 228 1 589 8 081

Total

5 472 1 537 1 694 8 703 5 404 1 564 1 593 8 561

1 Scope of reporting: these numbers represent all UCB regular active employees as of December 31, 2022. Students, apprentices, trainees, employees on leave and contractors are not

included in the headcount data.

2 UCB has no non-guaranteed hours employees.

Permanent and fixed-term contracts by gender

2022 (β) 2021

Women Men Total Women Men Total

Fixed-term contract

239 220 459 246 234 480

Permanent contract

4 175 4 069 8 244 4 048 4 033 8 081

Total

4 414 4 289 8 703 4 294 4 267 8 561

304 305

UCB | Integrated Annual Report 2022

Employees by region and gender

2022 (β) 2021

Women Men Total Women Men Total

Europe

2 751 2 721 5 472 2 694 2 711 5 405

Belgium

1 288 1 477 2 765 1 265 1 496 2 761

Germany

304 189 493 305 184 489

U.K.

474 389 863 452 382 834

Switzerland

212 368 580 204 359 563

Rest of Europe

473 298 771 467 290 757

International Markets (IM)

688 849 1 537 696 868 1 564

China

245 162 407 247 185 432

Japan

128 433 561 122 424 546

Rest of IM

315 254 569 327 259 586

U.S.

975 719 1 694 905 688 1 593

Grand total

4 414 4 289 8 703 4 294 4 267 8 561

Part-time and full-time contracts by gender

2022 (β) 2021

Women Men Total Women Men Total

Part-time contract

469 126 595 447 108 555

Full-time contract

3 945 4 163 8 108 3 847 4 159 8 006

Total

4 414 4 289 8 703 4 294 4 267 8 561

304 305

U.S. headcount by race

2022 (β)

Number

White

1 109 65.5%

Not specified

247 14.6%

Black or African American

148 8.7%

Asian

146 8.6%

Two or More Races

23 1.4%

Does not wish to answer

16 0.9%

American Indian/Alaskan Native

3 0.2%

Native Hawaiian or Other Pacific Island

2 0.1%

Total

1 694 100%

1 Graduate Development Program participants

Employees by subgroup and age group, men

2022 (β) 2021

≤

29y 30–49y

≥

50y Total

≤

29y 30–49y

≥

50y Total

Administration/support

45 174 117 336 55 166 115 336

Executives

0 24 65 89 0 24 61 85

Managers, professionals

and GDPs

105 1 708 944 2 757 116 1 703 879 2 698

Sales force

48 421 293 762 64 451 274 789

Technical staff

30 216 99 345 27 242 90 359

Total

228 2 543 1 518 4 289 262 2 586 1 419 4 267

Employees by subgroup and age group, women

2022 (β) 2021

≤

29y 30–49y

≥

50y Total

≤

29y 30–49y

≥

50y Total

Administration/support

47 248 195 490 47 256 193 496

Executives

1 12 42 55 1 15 34 50

Managers, professionals

and GDPs

162 2 039 871 3 072 165 2 024 752 2 941

Sales force

41 429 255 725 37 453 238 728

Technical staff

14 46 12 72 12 52 15 79

Total

265 2 774 1 375 4 414 262 2 800 1 232 4 294

306 307

UCB | Integrated Annual Report 2022

New hires by region

2022 (β)

2021

Europe

516 701

Belgium

233 333

Germany

31 44

U.K.

114 121

Switzerland

57 75

Rest of Europe

81 128

International Markets (IM)

205 232

China

62 98

Japan

85 81

Rest of IM

58 53

U.S.

340 214

Grand total

1 061 1 147

New hires by region and age group, women

2022 (β) 2021

≤

29y 30–49y

≥

50y Total

≤

29y 30–49y

≥

50y Total

Europe

60 169 40 269 67 226 54 347

Belgium

34 71 11 116 47 94 12 153

Germany

2 9 7 18 2 21 5 28

U.K.

11 41 9 61 5 45 15 65

Switzerland

8 12 2 22 3 16 4 23

Rest of Europe

5 36 11 52 10 50 18 78

International Markets (IM)

26 69 6 101 20 61 15 96

China

15 29 0 44 18 24 0 42

Japan

3 17 6 26 0 12 8 20

Rest of IM

8 23 0 31 2 25 7 34

U.S.

13 119 74 206 8 89 23 120

Grand total

99 357 120 576 95 376 92 563

306 307

New hires by region and age group, men

2022 (β) 2021

≤

29y 30–49y

≥

50y Total

≤

29y 30–49y

≥

50y Total

Europe

44 172 31 247 63 244 47 354

Belgium

24 87 6 117 41 122 17 180

Germany

1 11 1 13 0 14 2 16

U.K.

8 35 10 53 14 33 9 56

Switzerland

7 24 4 35 6 39 7 52

Rest of Europe

4 15 10 29 2 36 12 50

International Markets (IM)

13 74 17 104 35 88 13 136

China

8 10 0 18 30 26 0 56

Japan

5 41 13 59 3 46 12 61

Rest of IM

0 23 4 27 2 16 1 19

U.S.

12 70 52 134 6 61 27 94

Grand total

69 316 100 485 104 393 87 584

Departures by region

2022 (β)

2021

Europe

417 383

Belgium

203 150

Germany

23 33

U.K.

83 87

Switzerland

37 46

Rest of Europe

71 67

International Markets (IM)

218 342

China

85 127

Japan

63 54

Rest of IM

70 161

U.S.

247 207

Grand total

882 932

308 309

UCB | Integrated Annual Report 2022

Departures by region and age group, women

2022 (β) 2021

≤

29y 30–49y

≥

50y Total

≤

29y 30–49y

≥

50y Total

Europe

25 121 44 190 21 101 65 187

Belgium

13 53 14 80 8 34 26 68

Germany

2 9 3 14 2 4 9 15

U.K.

5 27 5 37 5 27 9 41

Switzerland

3 6 2 11 5 12 3 20

Rest of Europe

2 26 20 48 1 24 18 43

International Markets (IM)

16 71 12 99 32 125 9 166

China

14 30 1 45 23 43 1 67

Japan

1 13 3 17 2 10 2 14

Rest of IM

1 28 8 37 7 72 6 85

U.S.

7 83 48 138 7 63 41 111

Grand total

48 275 104 427 60 289 115 464

Departures by region and age group, men

2022 (β) 2021

≤

29y 30–49y

≥

50y Total

≤

29y 30–49y

≥

50y Total

Europe

27 133 67 227 18 109 69 196

Belgium

16 72 35 123 9 48 25 82

Germany

2 3 4 9 1 3 14 18

U.K.

7 28 11 46 3 31 12 46

Switzerland

0 16 10 26 5 14 7 26

Rest of Europe

2 14 7 23 0 13 11 24

International Markets (IM)

15 81 23 119 31 113 32 176

China

14 23 3 40 22 38 60

Japan

0 30 16 46 2 25 13 40

Rest of IM

1 28 4 33 7 50 19 76

U.S.

7 63 39 109 8 51 37 96

Grand total

49 277 129 455 57 273 138 468

308 309

Staff turnover

2022

Voluntary Involuntary

Total

voluntary and

involuntary

Administration/support staff

4.6% 1.4% 6.0%

Executives

3.6% 5.0% 8.6%

Managers/professionals

8.4% 2.8% 11.1%

Sales force

9.9% 4.7% 14.6%

Technical staff

4.5% 1.4% 6.0%

Total turnover rate

8.0% 2.9%

10.9% (β)

Mandatory trainings compliance rate

Percentage (%)

Code of

conduct

Safety

reporting

obligations

Data

protection

at UCB

Phishing

awareness

Anti-bribery

and anti-

corruption

Audience

All employees All employees All employees All employees

Selected

employees

Frequency

Every year Every 2 years Every 2 years Every 2 years Every 2 years

Compliance rate 2022

100% (β)

99% 97% 98%

93% (β)

Compliance rate 2021

95% 97% 93% 95% 95%

Average training hours women/men

2022

Administration/support staff

33/57

Executives

13/10

Managers, professionals and GDPs

29/30

Sales force

20/23

Technical staff

136/131

Average training hours

Total

328 492.29

1 Total turnover is the percentage of voluntary and involuntary terminated permanent contract employees during the last 12 months out of the average 12 months permanent contract

employee's headcount.

2 Graduate Development Program participants

3 The Ethics and Compliance team collaborates with the Talent and Company Reputation team to promote timely completion of this training. This training includes training on human

rights policies or procedures concerning aspects of human rights that are relevant to operations.

4 Compliance rate is a sum of employees who have completed the training and employees who are still within the time-frame to complete and comply with the mandatory trainings

310 PB

UCB | Integrated Annual Report 2022

Environmental data

Environment footprint progress

2015

(benchmark year)

2020 2021 2022

Variance

2022/2015

Scope covered (% employees)

86% 88% 89% 94% 9%

Energy (GigaJoules)

1 138 241 923 488 978 592 949 671 (β) - 17%

Electricity from

renewable sources

59.0% 95.0% 90.0% 90.1% 53%

e emissions (tons)

177 081 72 400 67 227 73 818 (β) - 58%

Scope 1 –

Direct CO

e emissions

56 578 31 115 28 267 26 554 (β) - 53%

Scope 2 –

Indirect CO

emissions

(market-based)

28 138 3 196 4 759 3 893 (β) - 86%

Scope 2 –

Indirect CO

e emissions

(location-based)

18 374 18 405 18 128 (β) N/A

Scope 3 – Greenhouse gas

(GHG) emissions (except

Category 1 and Category 7)

92 365 38 090 34 201 43 370 (β) - 53%

e emissions intensity

(CO

e tonnes/€m in revenue)

45.7 13.5 11.6 13.4 - 72%

Scope 3 – Category 1

(purchased goods and services)

663 936 708 651 735 523 726 547 9%

% of suppliers (by CO

emissions) committed to

SBT-like targets

8.7% 11.0% 20.6% 29.9% (β) N/A

Water (m

)

809 116 568 720 558 320 526 021 (β) - 35%

Waste (tons)

9 745 6 014 6,752 5 821 (β) - 40%

Waste recovered

95% 96% 96% 70% (β) - 26%

1 Scope 3 – Category 7 (employee commuting) is not included in the total as employee commuting could not be calculated during Covid-19 (2020 – 2021) and emissions from

employee commuting metric is currently only pre-assured. Scope 3 – Category 1 (purchased goods and services) is also not included in the total.

2 Scope 3 – Category 1 (purchased goods and services) baseline year is 2019 and not 2015 as our usual baseline. Current scope includes more than 99% of our supplier's spend.

3 802 tons of construction waste were not added to the amount reported in 2021. The former reported quantity has been corrected from 5.950 tons to 6.752 tons.

PB 311

Carbon footprint

— CO

e emissions

Indicator Definition

Tons CO

2015

Benchmark year 2022

Variance (%)

2022/2015

Scope 1

Electricity

0 0 N/A

Gas

36 610 11 719 - 68%

Fuel

973 555 - 43%

Car fleet

18 995 14 280 - 25%

Total

56 578 26 554 - 53%

Scope 2

Electricity

(market based)

28 138 3 893 - 86%

Electricity (location based)

N/A 18 128 N/A

Scope 1 and 2 Total

84 716 30 448 - 64%

Scope 1 and 2 intensity CO

e tonnes/€m in revenue

21.9 5.5 - 74%

Scope 3

Category 3 – Energy and fuel related activities

15 709 8 418 - 46%

Category 4 – Upstream

transportation and distribution

23 319 16 510 - 29%

Category 5 – Waste generated in operations

589 822 40%

Category 6 – Business (air) travel

46 734 13 986 - 70%

Category 12 – End-of-life treatment of sold products

6 014 3 634 - 40%

Scope 1, 2 and 3

(except Scope 3 – Category 1

and Category 7)

Total

177 081 73 818 - 58%

Scope 1, 2 and 3 intensity

(except Scope 3 –

Category 1 and Category 7)

e tonnes/€m in revenue

45.7 13.4 - 72%

Scope 3

Category 7 – Employee commuting

13 949 7 620 - 45%

Category 1 – Purchased goods and services

663 936 726 547 9%

% of suppliers (by CO

e emissions) committed

to SBT-like targets

N/A 29.9% N/A

1 UCB is reporting its CO₂ equivalent emissions as per the GHG protocol methodology. The applied emission factors from Bilan Carbon and EIO-LCA databases are provided and

yearly updated by UCB’s carbon third-party specialists. EIA emission factors are also used. For energy, invoices are collected from all sites part of the reporting (94% coverage): UCB’s

manufacturing sites, laboratories and all affiliates considered. For the other part of the scope, extrapolation is made to reach 100% of UCB’s emissions and are reported.

2 Four sites have been added to the scope of reporting: France, Turkey and Spain (added to the baseline year as they were already part of UCB in 2015) and Leuven Laboratory in Belgium

(recently acquired).

3 In 2021 we reported 717 tons of CO

e of biomethane as Scope 2 – Gas. Biomethane’s emissions reporting scope are Scope 1 and 3 (energy and related activities), therefore it has been

corrected and now added to the correct scope.

4 Japan has been added to the scope of CO

e emissions from car fleet reporting (recalculated benchmark year to reflect broader scope).

5 This metric includes the CO₂ equivalent emissions from the end-of-life treatment of all products sold by UCB in different markets in the reporting year. This includes everything that patients

or caregivers dispose of after using UCB drugs, with the exclusion of: pallets (tertiary packaging stops at the shipping box); site waste (already accounted for in UCB’s ‘waste’ metric); and

destroyed drugs after they reach the markets (insignificant related impact). A lifecycle analysis (LCA) tool developed by third party experts is used to obtain the end of life impact of a finished

good per dose and per market. When the LCA is not available yet for certain SKU, a proxy assignation is done, always using the worst case scenario.

6 Scope 3 – Category 7 (employee commuting) is not included in the total, as emissions from employee commuting metric is currently only pre-assured.

7 This metric includes the annual spend with UCB suppliers, converted into CO₂e emissions using average industry spend based emission factors (from Bilan Carbon and EIO-LCA databases).

Suppliers already accounted for in UCB’s other greenhouse gas emission scope 1, 2 or 3 and suppliers with a CAPEX spend representing more than 80% of its total spend (which falls under

the “capital goods” reporting category") are not in scope for this reporting category. Suppliers with uncategorized spending are excluded from this disclosure, representing only 1% of UCB’s

purchased goods and services emissions. Therefore, UCB’s purchased goods and services category considers more than 99% of its suppliers' CO₂e emissions

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UCB | Integrated Annual Report 2022

Waste production

GRI indicator Definition Tons

2015

Benchmark year

2022

Variance (%)

2022/2015

306-3

Waste disposal

Total

9 745 5 821 - 40%

Hazardous waste

Hazardous waste as defined by locally

applicable regulations

6 455 3 347 - 48%

Non-hazardous waste

Other solid waste (excluding

emissions and effluents)

3 291 2 474 - 25%

Total number and volume

of significant spills

Total number of significant

spills (absolute number)

0 2 (β) N/A

Total number and volume

of significant spills

Total volume of significant spills

0 4 N/A

Water withdrawal

GRI indicator Definition m

2015

Benchmark year

2022

Variance (%)

2022/2015

303-3 Water

Total water

809 116 526 021 - 35%

Main water

629 183 458 773 - 27%

Ground and surface water

179 933 67 248 - 63%

Total water consumption on

area with water stress

335 539 317 601 - 5%

Percentage of water consumption in low

and medium water stressed areas

- 39.6% N/A

Water intensity m³ of water/€m in revenue

208.8 95.3 - 54%

Water saved

Water saved due to conservation and

efficiency improvements

- 54 871 N/A

Energy consumption

GRI indicator Definition GigaJoules

2015

Benchmark year

2022

Variance (%)

2022/2015

302-1

Total

Total energy consumption

1 138 241 949 671 - 17%

Gas

Gas consumption

652 584 383 209 - 41%

Fuel oil

Fuel oil consumption

12 956 8 299 - 36%

Fuel vehicles

Utility vehicle fuel consumption

158 151 - 4%

Car fleet fuel consumption

472 543 223 177 - 29%

Electricity

Electricity consumption

295 869 334 834 - 25%

302-4 Energy saved

Energy saved due to consideration

and efficiency improvements

6 743 19 723 193%

8 The total water withdrawn is the sum of the main water (water supplied by the city) and the ground and surface water (water taken from the environment in accordance with local

regulations) over the course of the reporting period. For water, invoices are collected from all sites part of the reporting (94% coverage): UCB’s manufacturing sites, laboratories and all

affiliates considered. The water stressed areas are identified as per the World Resources Institute ‘Aqueduct Water Risk Atlas’ database.

9 This disclosure covers the total amount of waste defined as hazardous and non-hazardous by local legislation (excluding wastewater) at the point of generation, created by UCB’s major

sites’ own activities (covering a minimum of 95% of the impact) during the reporting period. Waste data are compiled by type of treatment.

10 Spill is any accidental release of a hazardous substance that can affect human health, land, vegetation, waterbodies, and groundwater. Additionally to the GRI methodology UCB uses a

standard operational procedure to calculate the significance of a spill. The Spill Index calculation is based on three criteria: the nature, volume and fate of a spill (Spill Index = N x V x F),

each criteria is attributed with a score between 1-4 depending on its importance and we recognize a significant leakage when the Spill Index exceeds the score of 30.

11 One spill in Braine-l'Alleud and one spill in Bulle which were immediatly notified to the authorities and fully managed. No pollution was detected after analysis.

312 313

Task force on climate-related

financial disclosures statement

UCB is committed to align with the Task Force on Climate-

related Financial Disclosure (TCFD), an initiative created by the

Financial Stability Board. This is UCB’s first full TCFD disclosure,

reflecting our actions and processes as of December 31, 2022.

You can access the full methodology used by UCB for the

TCFD assessment in our website.

Governance

Information about UCB’s governance of environmental topics

can be found in the sections 3.4.1 Board of Directors and 3.4.3

Governance for Sustainability of this report.

The Executive Vice President, Supply & Technology Solutions;

equivalent of the Chief Operating Officer (COO); is sponsoring

UCB's environmental and climate strategy, including reviewing

and approving the environmental strategy and associated

budget, climate and water targets and ambition-related

issues. The COO presents the environmental strategy to the

Sustainability Governance Committee chaired by the Global

Head of Sustainability (reporting to the CEO) for feedback

and alignment, and then to the Executive Committee for final

approval. The environmental strategy is also reviewed once

a year at the External Sustainability Advisory Board (ESAB)

meeting with 6 external subject matter experts, including one

expert on environmental issues.

The COO also chairs the Green Steering committee every

6 months, alongside colleagues from other functions, such

as the Head of Manufacturing and Engineering, the Head

of Procurement, the Head of Supply Chain, the Head of

Sustainability and other key internal stakeholders involved in

the management of environmental/climate-related processes,

program, risks and opportunities. The COO also holds monthly

meetings with the Head of Environmental Sustainability to

review UCB’s green program dashboard.

Strategy

UCB is committed to take environmental topics into

consideration when developing its business strategy. Within the

environmental risks and processes identified and disclosed on

a yearly basis in our Integrated Annual Report, UCB assessed

its exposure to climate-related risks and opportunities in

alignment with the TCFD recommendations.

Water scarcity and heavy precipitation and flooding were

determined to be the hazards with the highest material physical

risk to UCB’s operations and were studied at a greater detail in

an in-depth analysis. UCB will continue to monitor the other

physical hazards as well and perform additional in-depth

analysis when necessary.

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UCB | Integrated Annual Report 2022

Key physical risks

Risks Heavy precipitation and flooding Water scarcity

Timeframe Medium (2030) and long-term (2050) Medium (2030) and long-term (2050)

Locations in scope

25 key facilities to UCB selected on revenue

generated, size of facilities and number of

employees, and strategic importance of the

activities performed in the location

3 key locations to UCB (2 in Europe, 1 in

Asia) selected on revenue generated, size

of facilities and number of employees,

and strategic importance of the activities

performed in the location

Impacts

Some potential impacts include direct damage

to buildings owned by UCB and key suppliers, as

well as damage to nearby roads.

A worst-case scenario could mean business

interruptions if water supply is interrupted.

Financial implications

UCB may face increased operational costs due

to infrastructural damage, potential increase

in insurance costs, production and supply

chain interruptions, and adaptation costs for

building protection.

Water scarcity could have significant impact at

site level, including higher operational costs, cost

of tech transfer and production/supply chain

interruptions in case of extreme drought.

Financial

quantification

in 2050

RCP 4.5

scenario

Deemed not material according to UCB

financial risk ranking

Deemed not material according to UCB

financial risk ranking

RCP 8.5

scenario

Deemed not material according to UCB

financial risk ranking

Deemed not material according to UCB

financial risk ranking

Methodology

High-level screening using the Aqueduct Flood

Hazard Maps tool for both medium and long

term under the RCP 4.5 and RCP 8.5 scenarios

was done for the 25 sites, allowing to narrow

it down to 3 sites.

To account for the impact on the site

and its immediate surroundings, 3

measurements were obtained:

• Inundation height at the exact location

of the facility

• Mean inundation height for a 5km buffer area

around the facility

• Maximum inundation height for a 5km buffer

area around the facility

For the 3 facilities at highest risk, we collected the

on-site mitigation options and planned initiatives.

Screening of hydrological and meteorological

drought for three key sites for both medium

and long term under the RCP 4.5 and RCP 8.5

scenarios. Examples of indicators analyzed were:

• total annual precipitation

• consecutive dry days

• groundwater recharge

• streamflow

• blue water production

The potential financial impact was assessed for

the sites that showed a potential risk of water

availability, considering factors such as water

costs and insurance coverage.

Management response

Several local responses in place. Measures

include evacuation plans, flood protection

plans, and construction of underground

pipes and water tanks.

BREEAM/LEED certification for all new buildings

or major revamping that include climate change

resilience features.

Monitoring of water availability, implementation

of ongoing water saving measures such as

recycling systems as well as potential future

measures such as the use of water tanks to

collect water in more favorable periods.

314 315

The two transition risks selected for in-depth analysis were:

• Increased costs due to carbon pricing schemes

• Shift in market expectations: decreased revenues due to an increased demand for low-carbon products

Key transition risk

Risks Increased costs due to carbon pricing schemes

Timeframe Medium (2030) and long-term (2050)

Locations in scope

25 key facilities to UCB selected on revenue generated, size of facilities

and number of employees, and strategic importance of the activities

performed in the location

Potential impacts

Some potential impacts include direct damage to buildings owned by UCB and

key suppliers, as well as damage to nearby roads.

Financial implications

UCB may face increased operational costs due to infrastructural damage,

potential increase in insurance costs, production and supply chain interruptions,

and adaptation costs for building protection.

Quantification

in 2030

STEPS scenario (< 3°C)

Categorized as a “Low” financial risk according to UCB enterprise

risk management ranking

SDS scenario (< 2°C)

Categorized as a “Slight” financial risk according to UCB enterprise

risk management ranking

Methodology

The projection of UCB's direct and indirect emissions (i.e. exposure) in three

different pathways (emissions grow proportionally to UCB's revenues, SBT well

below 2°C aligned, SBT 1.5°C aligned) was combined with the different carbon

prices per location in two scenarios (IEA SDS and STEPS) (i.e. hazard) to obtain

the total indirect and direct carbon cost (i.e. impact) to be paid in the future

by UCB (while also considering the influence from decarbonization of the

economy in each scenario).

UCB is already on an ambitious climate pathway through its commitment to the

Science-Based Targets Initiative, having a ‘well-below 2°C’-aligned target

Management response

UCB is already on an ambitious climate pathway through its commitment to the

Science-Based Targets Initiative, having a ‘well-below 2°C’-aligned target.

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UCB | Integrated Annual Report 2022

Key transition risk

Risks

Shift in market expectations: decreased revenues due to an increased demand

for low-carbon products

Timeframe Medium-term (2030)

Locations in scope Three main UCB markets: U.S., Europe, Japan

Impacts

The increased expectation for low-carbon operations and products in the

healthcare sector might result in decreasing demand for UCB’s products in case

UCB does not meet ambitious enough climate-related targets.

Financial implications

UCB may face a loss of market share. Hence a decrease in volume sold, resulting

in lower revenues, and, eventually, lower profitability.

Quantification

in 2050

STEPS scenario (< 3°C)

Categorized as a “Slight to Moderate” financial risk according to UCB

enterprise risk management ranking

SDS scenario (< 2°C)

Categorized as a “Significant” financial risk according to UCB enterprise

risk management ranking

Methodology

This assessment results from the combination of the following dimensions: the

geographical markets where healthcare systems are likely to increase scrutiny

on products’ carbon intensity in each scenario (STEPS and SDS); the products

in UCB’s portfolio that are considered carbon-intensive compared to the

benchmark; and the risk of facing substitution via alternative products.

Management response

UCB is acting on several levers to produce low-carbon products: increase in the

share of recycled solvents for pharma products (as solvents are the main driver

for product emissions); shift to further renewable energy for bioproducts (as

energy consumption is one of the main drivers for product emissions); etc. (cf.

the Annual Integrated report for more details).

To address this risk, UCB launched the green product scorecard initiative to

minimize the environmental impact of our solutions. Based on a systematic

”cradle-to-grave” lifecycle analysis, this allows us to assess our impact and map

opportunities for environmental footprint reductions when developing and

producing solutions. Our framework was built to allow maturity growth and to

be in a continuous improvement mindset. Each UCB solution will undergo the

process routinely every three years to ensure we capture any new opportunity

for environmental impact decrease.

Risk Management

Information about UCB’s enterprise risk management

and environmental risks can be found in the section Risk

Management of this report.

Metrics and Targets

Information about UCB’s metric and targets related to climate

can be found in the sections Health of the planet goals and

Reaching carbon neutrality by 2030 of this report.

316 317

Disclosure

Full or partial

disclosure

Report reference SDG



General disclosures

2-1

Organizational details

a report its legal name



3.1 Scope of reporting

b report its nature of ownership and legal form



3.1 Scope of reporting

c report the location of its headquarters



Key figures

d report its countries of operation



Key figures

2-2

Entities included in the organization’s

sustainability reporting



UCB companies (fully consolidated)

2-3

Reporting period, frequency and contact point

a specify the reporting period for, and the frequency

of, its sustainability reporting



Our performance

b specify the reporting period for its financial

reporting and, if it does not align with

the period for its sustainability reporting,

explain the reason for this



Our performance

c report the publication date of the report or

reported information



Our performance

d specify the contact point for questions about the

report or reported information



Contact details

2-4 Restatements of information



Restatements of information are

added as footnotes to the data points

that have been restated.

2-5 External assurance



Independent limited assurance report

on the UCB integrated report 2022

2-6

Activities, value chain and other

business relationships

a report the sector(s) in which it is active;



Letter to Stakeholders

b describe its value chain, including:

i. the organization’s activities, products,

services, and markets served;

ii. the organization’s supply chain;

iii. the entities downstream from the organization

and their activities;



Our value creation model

Reinforcing our supply chain and

strengthening responsible

procurement

c report other relevant business relationships;



Driving progress in healthcare

through partnerships

Supporting innovation

around us via UCB Ventures

d describe significant changes in 2-6-a, 2-6-b, and

2-6-c compared to the previous reporting period.



No significant changes.

GRI Standards

1 SDG: Sustainable Develoment Goals

UCB has reported in accordance with the GRI Standards for the period of 01/01/2022 - 31/12/2022.

318 319

UCB | Integrated Annual Report 2022

Disclosure

Full or partial

disclosure

Report reference SDG



2-7

Employees

a report the total number of employees, and a

breakdown of this total by gender and by region



People data

b report the total number of:

i. permanent employees, and a breakdown by

gender and by region;

ii. temporary employees, and a breakdown by

gender and by region;

iii. non-guaranteed hours employees, and a

breakdown by gender and by region;

iv. full-time employees, and a breakdown by

gender and by region;

v. part-time employees, and a breakdown by

gender and by region;



People data

c describe the methodologies and assumptions

used to compile the data



People data

d report contextual information necessary

to understand the data reported

under 2-7-a and 2-7-b



People data

Employee development

e describe significant fluctuations in the number

of employees during the reporting period and

between reporting periods



There have been no significant

fluctuations in the number of

employees during the reporting period.

2-8 Workers who are not employees



Our value creation model

2-9

Governance structure and composition

a describe its governance structure, including

committees of the highest governance body;



3.4 Board of Directors

and Board committees

b list the committees of the highest governance

body that are responsible for decision-making

on and overseeing the management of the

organization’s impacts on the economy,

environment, and people;



Functioning of the Board

c describe the composition of the highest

governance body and its committees



3.4.1 Board of Directors

3.6 Diversity at Board and

Executive Committee level

2-10

Nomination and selection of the

highest governance body



3.4.2 Board committees

3.6 Diversity at Board and

Executive Committee level

2-11 Chair of the highest governance body



3.4.1 Board of Directors

2-12

Role of the highest governance body in overseeing

the management of impacts



Functioning of the Board

3.4.3 Governance for Sustainability

2-13 Delegation of responsibility for managing impacts



3.4.3 Governance for Sustainability

2-14

Role of the highest governance body in

sustainability reporting



3.4.2 Board committees

2-15 Conflicts of interest



3.12 Conflicts of interest – Application

of article 7:96 of the Belgian Code of

Companies and Associations

2-16 Communication of critical concerns



Risk Management

2-17

Collective knowledge of the

highest governance body



3.4.3 Governance for Sustainability

2-18

Evaluation of the performance of the

highest governance body



Assessment of the Board

318 319

Disclosure

Full or partial

disclosure

Report reference SDG



2-19

Remuneration policies

a describe the remuneration policies for members of

the highest governance body and senior executives



Remuneration in 2022

b describe how the remuneration policies for

members of the highest governance body and

senior executives relate to their objectives and

performance in relation to the management

of the organization’s impacts on the economy,

environment, and people



Remuneration in 2022

2-20 Process to determine remuneration



3.7 Remuneration Report

Remuneration in 2022

2-21 Annual total compensation ratio



Remuneration report

Not applicable. Following the Belgian

Code of Companies and Associations,

UCB reports the remuneration of the

highest-paid individual and the average

remuneration for employees, with

the year on year change, as well as

the ratio of total remuneration of the

highest-paid individual versus lowest

remunerated employee.

2-22 Statement on sustainable development strategy



Letter to Stakeholders

2-23

Policy commitments

a describe its policy commitments for

responsible business conduct;



Ethical business practices

b describe its specific policy commitment to

respect human rights;



1.3 Human Rights

c provide links to the policy commitments if publicly

available, or, if the policy commitments are not

publicly available, explain the reason for this;



Ethical business practices

d report the level at which each of the policy

commitments was approved within the

organization, including whether this is

the most senior level;



Ethical business practices

e report the extent to which the policy commitments

apply to the organization’s activities and to its

business relationships;



Ethical business practices

f describe how the policy commitments are

communicated to workers, business partners, and

other relevant parties.



Ethical business practices

2-24 Embedding policy commitments



Ethical business practices

2-25 Processes to remediate negative impacts



1.1 Ethics & Compliance Program

1.3 Human Rights

2-26 Mechanisms for seeking advice and raising concerns



1.1 Ethics & Compliance Program

2-27 Compliance with laws and regulations



Ethical business practices

2-28 Membership associations



Driving progress in healthcare

through partnerships

2-29 Approach to stakeholder engagement



Driving progress in healthcare

through partnerships

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UCB | Integrated Annual Report 2022

Disclosure

Full or partial

disclosure

Report reference SDG



2-30 Collective bargaining agreements

Information unavailable. Collective

bargaining agreements are country

specific and managed locally. UCB

will continue looking into ways

to further report on GRI metrics

in the upcoming years.

3-1 Process to determine material topics



Delivering on sustainable performance

3-2 List of material topics



Delivering on sustainable performance

Ethical business practices

3-3 Management of material topics



Ethical business practices

205-1 Operations assessed for risks related to corruption



1.2 Anti-Bribery and

Anti-Corruption (ABAC)

205-2

Communication and training about anti-corruption

policies and procedures



1.2 Anti-Bribery and

Anti-Corruption (ABAC)

Information incomplete.

UCB launched a new ABAC policy and

training on the last quarter of 2022

and only data related to our own

employees training is available as of

now. UCB will continue looking into

ways to further report on GRI metrics

in the upcoming years.

205-3 Confirmed incidents of corruption and actions taken



1.2 Anti-Bribery and

Anti-Corruption (ABAC)

206-1

Legal actions for anti-competitive behavior,

anti-trust, and monopoly practices



1.1 Ethics & Compliance Program

Health of the planet

3-3 Management of material topics



Health of the planet goals

302-1 Energy consumption within the organization



Environmental data

Information incomplete. UCB does

not differentiate the consumption

categories according to GRI and

the conversion factors used. UCB

will continue looking into ways

to further report on GRI metrics

in the upcoming years.

302-4 Reduction of energy consumption



Environmental data

303-1 Interactions with water as a shared resource



Reducing water usage by 20% by 2030

Information incomplete. UCB

will continue looking into ways to

further report on GRI metrics in

the upcoming years.

320 321

Disclosure

Full or partial

disclosure

Report reference SDG



303-3 Water withdrawal



Environmental data

Information incomplete. UCB does

not differentiate the water sources

according to GRI. UCB will continue

looking into ways to further report on

GRI metrics in the upcoming years.

305-1 Direct (Scope 1) GHG emissions



Environmental data

305-2 Energy indirect (Scope 2) GHG emissions



Environmental data

305-3 Other indirect (Scope 3) GHG emissions



Environmental data

305-4 GHG emissions intensity



Environmental data

305-5 Reduction of GHG emissions



Environmental data

306-1

Waste generation and significant

waste-related impacts



Reducing absolute waste

generation by 25% by 2030

306-3 Waste generated



Environmental data

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Disclosure

Full or partial

disclosure

Report reference SDG



308-1

New suppliers that were screened using

environmental criteria



Partnering with our suppliers for better

societal impact and reduction of our

environmental footprint

308-2

Negative environmental impacts in the supply

chain and actions taken



Partnering with our suppliers for better

societal impact and reduction of our

environmental footprint

Health, safety and wellbeing

3-3 Management of material topics



Putting health, safety

and wellbeing first

403-1 Occupational health and safety management system



Putting health, safety

and wellbeing first

403-2

Hazard identification, risk assessment

and incident investigation

a A description of the processes used to identify

work-related hazards and assess risks on a

routine and non-routine basis, and to apply

the hierarchy of controls in order to eliminate

hazards and minimize risks



Putting health, safety

and wellbeing first

b A description of the processes for workers to

report work-related hazards and hazardous

situations, and an explanation of how workers are

protected against reprisals.



Putting health, safety

and wellbeing first

c A description of the policies and processes

for workers to remove themselves from work

situations that they believe could cause injury or

ill health, and an explanation of how workers are

protected against reprisals.

Not reported. UCB will continue

looking into ways to further report on

GRI metrics in the upcoming years.

d A description of the processes used to investigate

work-related incidents, including the processes

to identify hazards and assess risks relating to

the incidents, to determine corrective actions

using the hierarchy of controls, and to determine

improvements needed in the occupational health

and safety management system.



Putting health, safety

and wellbeing first

403-5 Worker training on occupational health and safety



Putting health, safety

and wellbeing first

403-6 Promotion of worker health



Putting health, safety

and wellbeing first

322 323

Disclosure

Full or partial

disclosure

Report reference SDG



403-9

Work-related injuries

a For all employees



Putting health, safety

and wellbeing first

b For all workers who are not employees

but whose work and/or workplace is

controlled by the organization

Information incomplete. For some

sites (specified in the report), workers

who are not employees but whose

work is controlled by UCB is added

to the scope, but not for all sites.

UCB will continue looking into ways

to further report on GRI metrics

in the upcoming years.

c The work-related hazards that pose a risk of

high-consequence injury

Not reported. UCB will continue

looking into ways to further report on

GRI metrics in the upcoming years.

d Any actions taken or underway to eliminate other

work-related hazards and minimize risks using the

hierarchy of controls.



Putting health, safety

and wellbeing first

e Whether the rates have been calculated based on

200,000 or 1,000,000 hours worked.



Putting health, safety

and wellbeing first

f Whether and, if so, why any workers have been

excluded from this disclosure, including the

types of worker excluded.



Putting health, safety

and wellbeing first

g Any contextual information necessary to

understand how the data have been compiled,

such as any standards, methodologies,

and assumptions used.



Putting health, safety

and wellbeing first

Employee development

3-3 Management of material topics



Employee development

404-1 Average hours of training per year per employee



Employee development

People data

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UCB | Integrated Annual Report 2022

Disclosure

Full or partial

disclosure

Report reference SDG



404-2

Programs for upgrading employee skills and

transition assistance programs

a Type and scope of programs implemented and

assistance provided to upgrade employee skills.



Employee development

b Transition assistance programs provided to

facilitate continued employability and the

management of career endings resulting from

retirement or termination of employment.

Information unavailable. Transition

assistance programs are country

specific and managed locally. UCB

will continue looking into ways

to further report on GRI metrics

in the upcoming years.

Diversity, equity and inclusion

3-3 Management of material topics



Diversity, equity and inclusion

405-1

Diversity of governance bodies and employees

a Percentage of individuals within the

organization’s governance bodies in each of the

diversity categories



Diversity at the Board level

b Percentage of employees per employee category

in each of the diversity categories



People data

Product safety and quality

3-3 Management of material topics



Ensuring product safety and quality

416-1

Assessment of the health and safety impacts of

product and service categories



Ensuring product safety and quality

416-2

Incidents of non-compliance concerning the health

and safety impacts of products and services



Ensuring product safety and quality

Scientific innovation

3-3 Management of material topics



Innovating for people impacted

by severe diseases

601-1 Percentage of revenue invested in R&D



Innovating for people impacted

by severe diseases

601-2 Number of assets in pipeline



Advancing a Healthier

Tomorrow for Patients

Access to medicines

3-3 Management of material topics



Providing access to our solutions

701-1 Access coverage index



Providing access to our solutions

701-2 Timely access index



Providing access to our solutions

324 325

Report reference

Safety of clinical trial participants

HC-BP-210a

1 Discussion, by world region, of management process

for ensuring quality and patient safety during clinical trials

Ensuring product safety and quality

2 Number of FDA Sponsor Inspections related to clinical trial

management and pharmacovigilance that resulted in:

(1) Voluntary Action Indicated (VAI) and

(2) Official Action Indicated (OAI)

Ensuring product safety and quality

3 Total amount of monetary losses as a result of legal proceedings

associated with clinical trials in developing countries

Material settlements are reported in

Note 34. Provisions.

Access to medicines

HC-BP-240a

1 Description of actions and initiatives to promote access to

health care products for priority diseases and in priority countries

as defined by the Access to Medicine Index

Expanding access in low- and

middle-income geographies

2 List of products on the WHO List of Prequalified

Medicinal Products as part of its Prequalification of

Medicines Programme (PQP)

UCB has no products in the WHO List of

Prequalified Medicinal Products

Affordabilty and pricing

HC-BP-240b

1 Number of settlements of Abbreviated New Drug Application

(ANDA) litigation that involved payments and/or provisions to

delay bringing an authorized generic product to market for

a defined time period

UCB intends to further report on SASB

accounting metrics in the upcoming years

2 Percentage change in:

(1) average list price and

(2) average net price across U.S. product portfolio

compared to previous year

Expanding access to UCB

medicines in the U.S.

3 Percentage change in:

(1) list price and

(2) net price of product with largest increase

compared to previous year

Expanding access to UCB

medicines in the U.S.

Drug safety

HC-BP-250a

1 List of products listed in the U.S. Food and Drug

Administration’s (FDA) MedWatch Safety Alerts for Human

Medical Products database

Available at FDA Safety Information and

Adverse Event Reporting Program

2 Number of fatalities associated with products as reported

in the FDA Adverse Event Reporting System

Available at FDA Adverse Event

Reporting System (FAERS)

3 Number of recalls issued, total units recalled Ensuring product safety and quality

4 Total amount of product accepted for takeback,

reuse or disposal

UCB intends to further report on SASB

accounting metrics in the upcoming years

5 Number of FDA enforcement actions taken in

response to violations of current Good Manufacturing

Practices (cGMP), by type

Ensuring product safety and quality

SASB

326 327

UCB | Integrated Annual Report 2022

Report reference

Counterfeit drugs

HC-BP-260a

1 Description of methods and technologies used to maintain

traceability of products throughout the supply chain and

prevent counterfeiting

Ensuring product safety and quality

2 Discussion of process for alerting customers and business

partners of potential or known risks associated with

counterfeit products

UCB intends to further report on SASB

accounting metrics in the upcoming years

3 Number of actions that led to raids, seizure, arrests, and/or filing

of criminal charges related to counterfeit products

UCB intends to further report on SASB

accounting metrics in the upcoming years

Ethical marketing

HC-BP-270a

1 Total amount of monetary losses as a result of legal proceedings

associated with false marketing claims

Material settlements are reported in

Note 34. Provisions.

2 Description of code of ethics governing promotion of

off-label use of products

Product responsibility

Employee recruitment, development and retention

HC-BP-330a

1 Discussion of talent recruitment and retention efforts for scientists

and research and development personnel

Employee development

2 (1) Voluntary and

(2) involuntary turnover rate for:

(a) executives/senior managers,

(b) mid-level managers,

(d) all others

People data

Supply chain management

HC-BP-430a

1 Percentage of:

(1) entity’s facilities and

(2) Tier I suppliers’ facilities participating in the Rx-360

International Pharmaceutical Supply Chain Consortium audit

program or equivalent third-party audit programs for integrity

of supply chain and ingredients

UCB intends to further report on SASB

accounting metrics in the upcoming years

Business ethics

HC-BP-510a

1 Total amount of monetary losses as a result of legal proceedings

associated with corruption and bribery

Material settlements are reported in

Note 34. Provisions

2 Description of code of ethics governing interactions with

health care professionals

Ethical Business Practices

Activity metrics

HC-BP-000

A Number of patients treated Letter to Stakeholders

B Number of drugs

(1) in portfolio and

(2) in research and development (Phases 1 to 3)

www.ucb.com/our-products

Our Pipeline

326 327

Independent limited assurance

report on the subject matter

information of the integrated

annual report 2022 of UCB SA

To the Board of Directors of UCB SA,

This report has been prepared in accordance with the terms

of our contract dated 16 November 2022 (the “Agreement”),

whereby we have been engaged to issue an independent

limited assurance report in connection with selected

sustainability performance indicators, marked with a Greek

small letter beta (

), in the Integrated Annual Report as of and

for the year ended 31 December 2022 of UCB SA and its

subsidiaries (the “Report”).

The Directors’ Responsibility

The Directors of UCB SA (“the Company”) are responsible for

the preparation and presentation of the information and data

in the selected sustainability performance indicators for the

year 2022, marked with a Greek small letter beta (ß) in the

Report of UCB and its subsidiaries, and the declaration that

its reporting meets the requirements of the Global Reporting

Initiative (GRI) Standards (the “Subject Matter Information”), in

accordance with the criteria disclosed in the Report and with

the recommendations of the GRI Standards (the “Criteria”).

This responsibility includes the selection and application of

appropriate methods for the preparation of the Subject Matter

Information, for ensuring the reliability of the underlying

information and for the use of assumptions and estimates for

individual sustainability disclosures which are reasonable in the

circumstances. Furthermore, the responsibility of the Directors

includes the design, implementation and maintenance

of systems and processes relevant for the preparation of

the Subject Matter Information that is free from material

misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an independent conclusion

about the Subject Matter Information based on the procedures

we have performed and the evidence we have obtained.

We conducted our work in accordance with the International

Standard on Assurance Engagements 3000 (Revised)

“Assurance Engagements other than Audits or Reviews of

Historical Financial Information” (ISAE 3000), issued by the

International Auditing and Assurance Standards Board. This

standard requires that we comply with ethical requirements

and that we plan and perform the engagement to obtain

limited assurance as to whether any matters have come to

our attention that cause us to believe that the Subject Matter

Information has not been prepared, in all material respects, in

accordance with the Criteria.

The procedures performed in a limited assurance engagement

vary in nature and timing from, and are less in extent than for, a

reasonable assurance engagement. Consequently, the level

of assurance obtained in a limited assurance engagement is

substantially lower than the assurance that would have been

obtained had a reasonable engagement been performed. The

selection of such procedures depends on our professional

judgement, including the assessment of the risks of material

misstatement of the Subject Matter Information in accordance

with the Criteria. The scope of our work comprised the

following procedures:

• assessing and testing the design and functioning of the

systems and processes used for data-gathering, collation,

consolidation and validation, including the methods

used for calculating and estimating the Subject Matter

Information as of and for the year ended 31 December 2022

presented in the Report;

• conducting interviews with responsible officers;

• reviewing, on a limited test basis, relevant internal and

external documentation;

• performing an analytical review of the data and trends in the

information submitted for consolidation;

• considering the disclosure and presentation of the Subject

Matter Information.

The scope of our work is limited to assurance over the Subject

Matter Information in the Report. Our assurance does not

extend to information in respect of earlier periods or to any

other information included in the Report.

Our Independence and Quality Control

Our engagement has been carried out in compliance with

the legal requirements in respect of auditor independence,

particularly in accordance with the rules set down in articles

12, 13, 14, 16, 20, 28 and 29 of the Belgian Act of 7 December

2016 organizing the audit profession and its public oversight

of registered auditors, and with other ethical requirements of

the International Code of Ethics for Professional Accountants

(including International Independence Standards) issued by

the International Ethics Standards Board for Accountants

(IESBA Code), which is founded on fundamental principles of

integrity, objectivity, professional competence and due care,

confidentiality and professional behaviour.

328 329

UCB | Integrated Annual Report 2022

Our firm applies International Standard on Quality Control 1

and accordingly maintains a comprehensive system of quality

control including documented policies and procedures

regarding compliance with ethical requirements, professional

standards and applicable legal and regulatory requirements.

Conclusion

Based on the procedures we have performed and the evidence

we have obtained, nothing has come to our attention that

causes us to believe that the Subject Matter Information within

your Report as of and for the year ended 31 December 2022

has not been prepared, in all material respects, in accordance

with the Criteria.

Other ESG related information

The other information comprises all of the ESG related

information in the Report other than the Subject Matter

Information and our assurance report. The directors are

responsible for the other ESG related information. As explained

above, our assurance conclusion does not extend to the

other ESG related information and, accordingly, we do not

express any form of assurance thereon. In connection with our

assurance of the Subject Matter Information, our responsibility

is to read the other ESG related information and, in doing

so, consider whether the other ESG related information is

materially inconsistent with the Subject Matter Information or

our knowledge obtained during the assurance engagement, or

otherwise appears to contain a material misstatement of fact.

If we identify an apparent material inconsistency or material

misstatement of fact, we are required to perform procedures

to conclude whether there is a material misstatement of

the Subject Matter Information or a material misstatement

of the other information, and to take appropriate actions in

the circumstances.

Other matter - Restriction on Use and Distribution

of our Report

Our report is intended solely for the use of the Company, in

connection with their Report as of and for the year ended 31

December 2022 and should not be used for any other purpose.

We do not accept or assume and deny any liability or duty of

care to any other party to whom this report may be shown or

into whose hands it may come.

Diegem, 21 February 2023

PwC Bedrijfsrevisoren BV/Reviseurs d'Entreprises SRL

represented by

Marc Daelman

Registered auditor

1 Marc Daelman BV, Director, represented by its permanent representative Marc Daelman

328 329

UCB | Integrated Annual Report 2022

Accounting

for Value

2022 UCB U.S. Sustainable Access and

Pricing Transparency Report

330

Our approach to innovation has always kept patients at the

center. We consider the person, not just the disease, and we aim

to address their needs in ways that go beyond only medicines,

especially when it pertains to providing innovative solutions to

address access and affordability challenges.

Now in its second year, the UCB U.S. Sustainable Access and

Pricing Transparency Report continues to provide information

to stakeholders about how we account for the value of our

medicines as well as outline the actions we have taken to build a

more sustainable system together.

We make every decision with an eye to how it affects the

people who put their trust in us: the people who rely on our

medicines, families and caregivers, health care providers, payers,

and the entire healthcare value chain. We strive to earn this trust

every day by honoring our commitment to deliver moments

that matter for people impacted by severe diseases, now and

into the future.

This report includes:

• How we are leading efforts to achieve sustainable access in

the U.S. healthcare system

• How we deliver affordable access and account for value,

including when pricing our medicines

• Policy reform opportunities to build a sustainable system

together

UCB supports a competitive, value-based system that

provides sustainable, affordable, and equitable access

for all patients who need our medicines.

Letter from Our Leaders

EMMANUEL CAEYMAEX

Executive Vice President and Head

of U.S. and Immunology Solutions

PATTY FRITZ

Vice President and Head

of U.S. Corporate Affairs

This Report by the Numbers

95,583

Number of patients served by UCB

patient assistance programs in 2022

46%

of eligible UCB clinical studies implemented

Decentralized Clinical Trial model

48%

Portion of UCB gross sales

provided to payers as rebates/

discounts in 2022

-3.3%

Change in net prices for

2022 (cross portfolio)

$2.9 billion

2022 rebates and discounts

provided by UCB to supply

chain stakeholders, including

private and public payers

331

Access Vision, Strategies,

Goals, and Governance

Leading Efforts to Achieve Sustainable Access

in the U.S. Healthcare System

We commit to making our medicines as accessible as

possible in ways that are sustainable for people impacted by

severe diseases, for UCB, and for society. Despite ongoing

efforts, barriers to sustainable access still exist within our

current healthcare system:

• Patients are not always able to access or afford the best

medicines available for their unique conditions.

• The system does not always recognize the value of

innovative medicines for specific patients.

Deliver unique outcomes

that help specific patients

achieve their goals

Provide patients the best

individual experience

Ensure access to all those who

need these solutions in a way

which is viable for patients,

society, and UCB

Innovation Value-Based Care Aordable Access

Systemic health inequities also add barriers that significantly

impact the health, social, and economic wellbeing

of people and communities. At UCB, we believe we

cannot achieve sustainable access without health equity

and are addressing social determinants of health that

have exacerbated health inequities among historically

underserved communities.

UCB | Integrated Annual Report 2022

332

Patient Affordability and Transparency

UCB makes information on our pricing and affordability

available to patients. We provide accurate information on list

price or wholesale acquisition cost (WAC), expected out-of-

pocket costs across a range of coverage channels, as well as

patient assistance information on our website at:

UCB-USA.com/affordability.

Through our actions, we are dedicated to the continued

evolution of an equitable public policy environment that

recognizes and rewards innovation, encourages value-based

care, and promotes affordable access to medicines for patients.

Sustainable Performance

At UCB we are defined by our purpose: creating value for

patients, now and in the future. Sustainability is at our core,

and we innovate to bring differentiated solutions with unique

outcomes that help diverse patients achieve their life goals.

We are committed to improving access to these solutions for

all patients who need them in a way that is viable for UCB, our

investors, and society.

We are working to ensure that participants in UCB clinical trials

are reflective of the populations that will ultimately benefit from

our new medicines. We are committed to scientific innovation

and the discovery, development, and delivery of differentiated

solutions that provide measurable value to people living with

severe diseases — improving their lives now and in the future.

Our commitment to scientific advancements is why we

reinvest around 25% of our revenue each year in research and

development globally.

Our Strategy

About UCB in the United States

1 694

U.S. employees in 2022

$821.5 million

2022 U.S. economic footprint

More than 100

active clinical studies

7 UCB Oces

across 5 communities maintaining sites in

Georgia, Massachusetts, North Carolina,

Washington, and Washington, D.C

UCB | Integrated Annual Report 2022

333

Our goal is to address the unmet needs of people living with

a range of complex conditions, with a primary focus on

neurological and immunological diseases.

We continue to develop and deliver impactful solutions

to support patient populations including those living

with psoriasis, psoriatic arthritis, non-radiographic axial

spondyloarthritis, epilepsy, rare syndromes such as Lennox-

Gastaut and Dravet, and osteoporosis with continued

development efforts in diseases such as myasthenia gravis,

hidradenitis suppurativa, and systemic lupus.

For Additional Information on UCB, Visit:

U.S. Public Policy Platform

ucbCARES Patient and Provider Resources

Affordability Information

Sustainability as Our Business Approach

Diversity, Equity, and Inclusion at UCB

UCB-USA.com

“For people living with a rare

disease, we know that their

journey is complex and that

every patient is different. It’s

in those moments that matter

where we can listen to patients

and understand their experience

to help decrease their time to

diagnosis and treatment while

addressing unmet needs in the

rare disease community.”

Kimberly Moran, PhD, MBA,

Head of U.S. Rare Diseases

Our purpose is to create value for patients.

Now and into the future.

Our Areas of Focus Our People

Neurology

Sustainability as business approach 90+ Year scientific heritage

Immunology

3.4M Patients

use our medicines around the world

Countries

.7k

Employees

1928

UCB | Integrated Annual Report 2022

334

Patient Access

Delivering Affordable and Equitable Access for

Patients While Accounting for Value

UCB is focused on delivering sustainable access by striving to

make our medicines affordable for patients and society.

We aim to apply a principled, evidence-based approach when

pricing our medicines, consistent with the value our solutions

create for society, patients, and the healthcare system.

Additionally, we offer access programs to support patients who

may face barriers to accessing or affording needed medicines.

The current U.S. access and pricing environment – particularly

around affordability and insurance benefit design – creates

sustainability challenges for patients, society, and our business.

We are disappointed policies which could reduce access and

limit innovation are being implemented. We believe there is

more to do to evolve the healthcare system to serve patients

better, including examining the entire U.S. drug value chain to

identify reforms that will improve access and affordability while

allowing for continued innovation to bring improved treatments

to people living with severe diseases.

1 Global Genes. “RARE Disease Facts.” https://globalgenes.org/rare-disease-facts/. Accessed January 10, 2023.

2 For example, new data or enhancements that benefit existing or new patient populations.

We continue to innovate and invest in differentiated solutions

for people living with severe diseases, considering their journey

to help achieve their own goals and live their best possible

lives. However, utilization management policies can create

insurmountable access barriers for patients. This can be

especially challenging for those living with diseases like rare

neurological and immunological diseases where few options

currently exist and the journey to diagnosis may be long.

Prioritizing our commitment to ensuring patients can

access needed medications in this environment while

maintaining a sustainable pricing model, UCB developed and

implemented a set of foundational pricing principles in 2019

that tie price to value.

As part of UCB’s pricing principles, net prices generally do not

increase each year by more than the Consumer Price Index

for All Urban Consumers (CPI-U), a metric that represents the

percent change over time of the price of specific goods and

services in the U.S. Any increase in price is tied to the value

UCB’s products bring to patients and society. Exceptional net

price increases above CPI-U are linked to meaningful increase

in patient or societal value.

The CPI-U baseline is determined

by a combination of Bureau of Labor Statistics data and Federal

Open Market Committee (FOMC) forecasts.

Patient Support

ucbCARES: Patients should never feel alone or left with

unanswered questions about medications they have been

prescribed. ucbCARES is a dedicated service providing

support to patients, caregivers, and healthcare professionals

throughout the treatment journey.

When contacting ucbCARES, patients and their families

interact with specialists who are caring, ready to listen, and

prepared to help. The ucbCARES team can be reached

online or by phone at 1-844-599-CARE (2273) to help

with questions about UCB products, clinical trials, or our

assistance programs.

Patient Assistance: While UCB advocates for policy changes

that will help to improve patient access and affordability,

we understand patients need assistance to obtain their

medications right now.

Through the UCB Patient Assistance program, we provide

certain medications at no cost to eligible and qualified

patients who are uninsured or underinsured who otherwise

have no access to the UCB medications prescribed by

their physician.

UCB Population Health Resources: Population health is

an important aspect of understanding the needs of people

living with severe diseases and seeking solutions to address

those needs. Our population health teams work with a wide

range of stakeholders to help address challenges facing

groups of individuals and their health outcomes. View our

online resources to learn more about UCB’s initiatives.

UCB | Integrated Annual Report 2022

335

Figure 1 – Patients Benefitting from UCB Assistance Programs

UCB also works to ensure our medicines are accessible to those

who need them by considering patient out-of-pocket costs

when negotiating formulary access with payers and offering

patient assistance programs for uninsured or underinsured

patients. For future launches, we use an internal pricing

framework to continue ensuring that our pricing reflects the

value our medicines provide to specific populations with

unmet needs.

“As UCB continues to expand

our portfolio of medicines

for epilepsy, rare epilepsy

syndromes, and seizure rescue,

we remain dedicated to delivering

transformative medicines.”

Brad Chapman,

Head of U.S. Epilepsy and Rare Syndromes

UCB Portfolio Pricing for Sustainable Value –

2018-2022

We strive to promote a healthcare system that provides

sustainable, affordable, and equitable access for all people who

need our medicines.

Guided by our pricing principles, we follow a value-based pricing

approach to support access to our medicines. As a reflection of

our principles, UCB has decreased its cross-portfolio net prices

five years in a row.

2018 2019 2020 2021 2022

Patients Benefitting from

UCB Assistance Programs

(including PAP and CoPay)

68 438 72 803 84 754 100 214 95 583

UCB’s assistance programs – including the patient assistance program and copay assistance – continue to help patients afford their needed medicines.

Simultaneously, our average discount rate increased by 2.9

percentage points, with UCB’s 2022 discounts hitting an all-time

high of 48.0%. That means UCB decreased its prices by almost

half as part of negotiations with health insurers and statutorily

required government discounts. We provided $2.9 billion in

rebates, discounts, and fees to private payers and government

programs as well as providers, distributors, and others.

The rebates, discounts, and fees paid by UCB reflect the

misaligned incentives in our current U.S. value chain that

prioritize robust concessions between manufacturers and

payers. However, we provide these discounts or rebates to

payers and pharmacy benefit managers (PBMs) to support and

improve access for patients who need and would benefit from

our medicines. The portion of discounts UCB pays to Medicaid

(21%) reflects the supplemental rebates that states negotiate

directly with manufacturers. Medicaid discounts along with

discounts from Medicare programs (29%), and other public

insurance programs, results in almost 50% of all discounts

going towards programs critical to many older and

low-income Americans.

In the current U.S. healthcare system, rebates and discounts

should translate to lower cost-sharing and greater affordability

for patients. Unfortunately, discounts and rebates are not always

used by payers to decrease out-of-pocket costs for patients.

More can be done to ensure these discounts are passed to

people at the pharmacy counter. Despite the constraints of the

current system, we aim to create value for people living with

severe diseases by helping them access the medicines they

need to enable them to live their best lives, whatever that means

for them.

UCB works within the current system, providing robust

negotiated rebates and discounts, to ensure that patients have

access to needed medications, recognizing that this may not

always lead to lower out-of-pocket costs for patients. As

such, UCB simultaneously endeavors to positively change that

system to improve patient affordability of all medicines.

UCB | Integrated Annual Report 2022

336

Figure 2 – UCB U.S. Product Portfolio Pricing % Change, 2018-2022

1 Annual percent change vs. prior year was calculated at a product level and weighted across the company’s U.S. Product Portfolio

2 Represents the year-over-year change in the average list price or wholesale acquisition cost (WAC)

3 Represents the year-over-year change in average net price, which is WAC less rebates, discounts and returns, as provided by UCB Finance

4 Weighted average annual discount is calculated by dividing the sum of annual rebates, discounts and returns by annual gross sales

Data Note: Rebates, discounts, and returns are estimated by the company and methodologies used may differ from those used by other companies.

This data is not audited and should be read in conjunction with the company’s filings with the Financial Services and Markets Authority (FSMA). UCB

implemented its pricing principles and the realization took place between 2019 and 2020, which is reflected in the data.

2018 2019 2020 2021 2022

U.S. Product Portfolio %

Change vs. Prior Year

List Price Change

(WAC)

5.6% 6.4% 4.9% 4.0% 6.3%

Net Price Change

4.1% 3.6% -2.5% -2.3% -3.3%

U.S. Product Portfolio

Avg. Discount

(%)

36.1% 39.4% 42.2% 45.2% 48.9%

Figure 3 – Patients Benefiting from UCB Products in the U.S.

2018 2019 2020 2021 2022

U.S. Patients Served by

UCB Products

282 095 321 986 334 942 417 834 312 403

*Based on December monthly data aggregated for U.S. marketed products (BRIVIACT

**, CIMZIA

**, FINTEPLA

**, NAYZILAM

**, NEUPRO

**, and

VIMPAT

**). NAYZILAM

**’s first full year on the market was 2020. In 2022, FINTEPLA

** was added to UCB’s portfolio and VIMPAT

** had a loss

of exclusivity.

** Prescribing information varies depending on regulatory approval in each country.

UCB | Integrated Annual Report 2022

337

“At UCB, we’re inspired by patients

and driven by science. Our

approach to value-based care is

driven by achieving sustainability,

affordability, and access.”

Matt Harutunian,

Head of U.S. Advocacy

UCB Perspectives

Discovering solutions propels patient care forward. UCB aims

to continuously innovate and invest in differentiated solutions

for people living with severe disease. We strive to undertake

initiatives beyond medicines to accelerate discoveries, help the

value chain work better, and improve the patient journey.

Value-Driven Care

Equity

UCB understands that regular engagement with

the people who use our medicines, healthcare

professionals, and advocacy and professional

organizations is an important aspect of our work to

advance policies that support value-driven care and

help people living with severe diseases. Every day, we

work to ensure that people living with severe diseases

have the best individual experience while promoting

access to value-driven care, meaning high-quality,

affordable care. Patients can experience frustration

when they face acess barriers, but through our work

with advocacy organizations such as the National

Psoriasis Foundation and the Global Health Living

Foundation, we are foucsed on changing the status

quo to help people living with severe diseases live the

best life they can – as they define it.

Collaborating with

Patient Communities

Value-Driven Care

UCB | Integrated Annual Report 2022

338

At UCB, we are committed to taking action to bridge gaps

and facilitate equitable care. For UCB, our connection

with the people we serve goes beyond medicines. Our

commitment spans from diversity and inclusion in clinical

trials to using data-driven approaches and collaborating

with our partners. Solving a problem as systemic as racial

disparities in healthcare will require an earnest commitment

from all stakeholders.

Population health is an important aspect of understanding

the needs of people living with severe diseases. Our

population health teams work with a wide range of

stakeholders – healthcare professionals, integrated delivery

networks, academics, patients and caregivers, and more

– to help address challenges facing groups of individuals

and their health outcomes. UCB has prioritized creating

resources across therapeutic areas to improve population

health – especially for those from historically underserved

communities.

Population Health

Health Equity

“Advancing health equity

requires a cross-system

approach that promotes

demolishing barriers,

transforming health systems,

and addressing poor drivers of

health. UCB is committed to

working with stakeholders to

co-create solutions addressing

health inequity through

population health initiatives.”

Nicole Williams,

Portfolio Innovation Partner, U.S. Immunology

“We are focused on not only

the patient component,

but also the people and

community component,

and that includes families

and caregivers. We seek to

gain a deep understanding

of the experiences of those

impacted by these diseases

and work with them to create

value by providing better and

differentiated solutions and

services as they navigate

their care.”

Judith Thompson,

Population Health Strategy Lead, Rare Diseases

UCB | Integrated Annual Report 2022

339

Health System and Societal Value

Building a Sustainable, Value-Driven System

Together

The U.S. health system is highly complex, and achieving broad,

systemic change is hard. The price controls provisions in the

Inflation Reduction Act are an example of how policy can fall

short: while intending to improve medicine affordability for

patients, these price controls do not ensure lower out-of-

pocket costs for people where they feel the most impact – at

the pharmacy counter.

To build the sustainable health system of the future, we need

solutions that span the system and stakeholders. UCB is

helping to drive that kind of change through transparency on

current access and affordability challenges to facilitate critical

conversations to move our healthcare system forward in ways

that serve people living with severe diseases better.

Improving Patient Affordability

We are committed to working across the healthcare

ecosystem – with patients, payers, providers, caregivers, and

policymakers – to explore a broad range of value-driven

contracting and financing approaches that more clearly

connect price to value and support smarter spending in the

healthcare ecosystem, while ensuring that patients can access

and afford the next generation of transformative medicines.

We are encouraged by the redesign of the Medicare Part D

cost-sharing structure contained in the Inflation Reduction Act,

and hope that the changes will lower Medicare beneficiaries’

out-of-pocket costs, and the option allowing patients to

“smooth” large costs over the benefit year will assist patients in

affording their medicines.

This change is the first step toward helping patients manage

out-of-pocket costs and may improve access to necessary

treatments. UCB is hopeful that additional changes are on the

horizon:

• Oftentimes, medicines are valued by PBMs based on the

discounts offered by manufacturers rather than the potential

benefits a medicine provides. However, people may not feel

the benefits of these negotiated discounts for prescription

drugs. Often, patients’ cost-sharing at the pharmacy counter

is based on the full list price, rather than the negotiated or net,

price insurers pay. Basing patient cost on negotiated, rather

than list, prices would meaningfully lower patient out-of-

pocket costs.

• People should have access to a range of affordable,

quality health plan options that permit patient assistance

from manufacturers and offer robust patient protections.

To that end, UCB supports policy reforms that require

copay assistance from manufacturers to count toward

a patient’s deductible and out-of-pocket maximum

(e.g., copay accumulator and maximizer bans), or at least

limit the use of those programs. Additionally, we want to

ensure patient health plans provide formulary access to

innovative, specialty medicines. We have come so far –

developing treatments that have transformed the standard of

care for patients with rare conditions and diseases. However,

excluding specialty medicines from covered benefits can

be detrimental to patients.

“If we’re going to achieve a true value-based healthcare system,

we are going to have to do that by starting with the patient and

putting the patient at the center of everything we do.”

Leah M. Howard, J.D.

President and CEO of the National Psoriasis Foundation

UCB | Integrated Annual Report 2022

340

Preserving the Provider-Patient Relationship

We believe in enhancing healthcare providers’ ability to choose

the best medicine for an individual patient’s treatment needs and

goals while minimizing unnecessary administrative burdens or

treatment restrictions (such as prior authorization procedures).

Step therapy is used by many payers as a mechanism to save

money for themselves, requiring patients to “step through” or

“try and fail” on one or more treatments before getting access

to the most appropriate treatment, as determined by the patient

and their healthcare provider. Step therapy requirements only

account for the cost of the drug to the plan, not overall costs to

the healthcare system.

We support policies that enable step therapy override protocols

to preserve patient-provider shared decision-making and

outline a clear path for providers to override step therapy

policies under certain circumstances (e.g., when it would

endanger the person’s health or the person has previously tried

and failed on step through treatments, the protocol is expected

to be ineffective or lead to adverse reaction in the patient) and

to protect the health of the person.

Supporting Patient-Centered Value Assessments

The U.S. healthcare system continues to evolve from a system

of care delivery and reimbursement that is volume-based

toward a value-based approach. To that end, we are committed

to better accounting for value and support ensuring that

frameworks for capturing, measuring, and assessing value are

aligned with broad principles that promote sustainable value

and equitable access to healthcare, beginning in the drug

development stages.

UCB recognizes the importance of value-assessment

frameworks and developed a broad set of Principles for Value

Assessment to ensure these frameworks support sustainable

value and equitable access to healthcare.

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Glossary

Adjusted EBIT

Operating profit adjusted for impairment charges, restructuring

expenses, and other income and expenses.

Adjusted EBITDA

(Earnings Before Interest, Taxes, Depreciation and Amortization

charges) Operating profit adjusted for amortization,

depreciation, impairment charges, restructuring expenses and

other income and expenses.

Adjusted gross profit

Gross profit without the amortization of intangible assets

linked to sales.

ALM

Asset-liability matching

CER

Constant exchange rates

Core EPS/Core earnings per share

Profit attributable to UCB shareholders, adjusted for the after-

tax impact of restructuring, impairment, other income/expense

items, the financial one-offs, the after-tax contribution from

discontinued operations and the after-tax amortization of

intangibles linked to sales, per non-dilutive weighted average

number of shares.

Core products

CIMZIA

**, VIMPAT

**, KEPPRA

**, BRIVIACT

**, NEUPRO

**,

FINTEPLA

**, NAYZILAM

**, BIMZELX

* AND EVENITY

CGU

Cash generating unit

CPM

The Corporate Performance Multiplier is one of the

2multipliers defining the bonus payout. It is based on the

company’s meeting corporate targets.

DTA

Deferred tax asset

EBIT/Earnings Before Interest and Taxes

Operating profit as mentioned in the consolidated

financial statements

EMA/European Medicines Agency

Agency responsible for the evaluation of medicinal products

designed to protect and promote human and animal health.

www. emea.europa.eu

EPS

Earnings per share

Established brands

Portfolio of 150 post-patent, high-quality medicines, with

proven value for patients and doctors since many years

Equity

Equity means ensuring all employees are offered fair

opportunities for development, advancement, compensation

and reward as per their aspirations

Extra-financial

‘Extra-financial’ is the term used by UCB for information

commonly referred to as ‘non-financial’

FDA/U.S. Food and Drug Administration

Agency within the U.S. Department of Health and Human

Services is responsible for protecting and promoting the

nation’s health www.fda.gov

FVOCI

Fair value through other comprehensive income

Financial assets at FVPL

Financial assets to be measured subsequently at fair value

through profit or loss

Financial assets at FVOCI

Financial assets to be measured subsequently at fair value

through other comprehensive income

Financial one-off items

Gains and losses arising upon the sale of non-current financial

assets (other than derivatives and reimbursement rights with

respect to defined benefit plans) as well as impairment losses

accounted for on these financial assets are considered as

financial one-off items.

* BIMZELX

has been approved in Australia, Canada, EU, Great Britain, Saudi Arabia, Switzerland and the United Arab Emirates for the treatment of moderate to severe plaque psoriasis in

adults who are candidates for systemic therapy (or phototherapy, for Canada and Australia). In Japan, for the treatment of plaque psoriasis, generalized pustular psoriasis and psoriatic

erythroderma in patients who are not sufficiently responding to existing treatments.

** Prescribing information varies depending on regulatory approval in each country.

UCB | Integrated Annual Report 2022

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FRMC

Financial Risk Management Committee

Global Reporting Initiative

An international independent standards organization that

helps businesses, governments and other organizations

to understand and report the most important social,

environmental and governance aspects raised by internal and

external stakeholders

IPM

Individual Performance Multiplier, one of the 2 multipliers

defining the bonus payout. It considers a combination of

individual results achieved and behaviors demonstrated.

LTI

Long-Term Incentives aim at motivating and retaining key talent

over a period of at least 3 years. They align employee rewards

with company and patient goals, providing increased financial

benefits as the company grows. At UCB, this includes Stock

Awards, Stock Options and Performance Shares.

NCI

Non-controlling interest

Net dividend

The amount a shareholder of UCB will receive after principal

deduction of Belgian withholding tax, which is currently 30%.

Lower withholding tax rates may be applicable for certain

categories of investors.

Net financial debt

Non-current and current borrowings, bonds and bank

overdrafts less available for sale debt securities, restricted cash

deposit with respect to financial lease agreements, cash and

cash equivalents

OCI

Other comprehensive income

Orphan drug

A medicine used in rare diseases

PBM

Pharmacy Benefit Manager

PGTCS

Primary generalized tonic-clonic seizures PMDA/

Pharmaceuticals and Medical Devices Agency

Japanese regulatory agency in charge of protecting the

public health by assuring safety, efficacy and quality of

pharmaceuticals and medical devices.

www.pmda.go.jp/english

POS

Partial onset seizures, also known as focal seizures

PSP

Performance Share Plan which awards a grant of UCB

common stock to qualifying executives. The awards vest three

years after grant, pending certain conditions, including meeting

pre-established companywide targets.

ROU asset

Right of use asset

Seed funding

The first official equity funding stage used to start a business,

fund research, or develop a product

SBTi – Science Based Targets initiative

The Science Based Targets initiative (SBTi) is a joint initiative by

the United Nations, the Carbon Disclosure Project, the World

Resources Institute and the World Wide Fund for Nature (WWF).

It supports organizations with setting climate targets in line with

the COP21 climate summit in Paris.

Sustainable Development Goals (SDGs)

Collection of 17 global goals set by the United Nations General

Assembly in 2015 defined as a call to action to end poverty,

protect the planet and ensure that all people enjoy peace

and prosperity

Weighted average number of ordinary shares

Number of ordinary shares outstanding at the beginning of a

given period, adjusted by the number of shares bought back or

issued during the period, multiplied by a time-weighting factor

Working capital

Includes inventories, trade and other receivables and trade and

other payables, both due within and after 12 months.

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343

Forward Looking Statement

Integrated Annual Report

This Integrated Annual Report contains forward-looking

statements, including, without limitation, statements

containing the words “believes”, “anticipates”, “expects”,

“intends”, “plans”, “seeks”, “estimates”, “may”, “will”, “continue”

and similar expressions. These forward-looking statements are

based on current plans, estimates and beliefs of management.

All statements, other than statements of historical facts, are

statements that could be deemed forward-looking statements,

including estimates of revenues, operating margins, capital

expenditures, cash, other financial information, expected legal,

arbitration, political, regulatory or clinical results or practices

and other such estimates and results. By their nature, such

forward-looking statements are not guarantees of future

performance and are subject to known and unknown risks,

uncertainties, and assumptions which might cause the actual

results, financial condition, performance or achievements of

UCB, or industry results, to be materially different from any

future results, performance, or achievements expressed or

implied by such forward-looking statements contained in this

Integrated Annual Report.

Important factors that could result in such differences

include but are not limited to: the global spread and impact

of pandemics (such as COVID-19), wars on territories where

UCB has businesses, changes in general economic, business

and competitive conditions, the inability to obtain necessary

regulatory approvals or to obtain them on acceptable terms

or within expected timing, costs associated with research

and development, changes in the prospects for products in

the pipeline or under development by UCB, effects of future

judicial decisions or governmental investigations, safety, quality,

data integrity or manufacturing issues; potential or actual

data security and data privacy breaches, or disruptions of

our information technology systems, product liability claims,

challenges to patent protection for products or product

candidates, competition from other products including

biosimilars, changes in laws or regulations, exchange rate

fluctuations, changes or uncertainties in tax laws or the

administration of such laws, and hiring and retention of

its employees. There is no guarantee that new product

candidates will be discovered or identified in the pipeline, or

that new indications for existing products will be developed

and approved. Movement from concept to commercial

product is uncertain; preclinical results do not guarantee

safety and efficacy of product candidates in humans. So far,

the complexity of the human body cannot be reproduced

in computer models, cell culture systems or animal models.

The length of the timing to complete clinical trials and to get

regulatory approval for product marketing has varied in the

past and UCB expects similar unpredictability going forward.

Products or potential products which are the subject of

partnerships, joint ventures or licensing collaborations may be

subject to disputes between the partners or may prove to be

not as safe, effective or commercially successful as UCB may

have believed at the start of such partnership. UCB’s efforts

to acquire other products or companies and to integrate

the operations of such acquired companies may not be

as successful as UCB may have believed at the moment of

acquisition. Also, UCB or others could discover safety, side

effects or manufacturing problems with its products and/or

devices after they are marketed. The discovery of significant

problems with a product similar to one of UCB’s products

that implicate an entire class of products may have a material

adverse effect on sales of the entire class of affected products.

Moreover, sales may be impacted by international and

domestic trends toward managed care and health care cost

containment, including pricing pressure, political and public

scrutiny, customer and prescriber patterns or practices, and

the reimbursement policies imposed by third-party payers as

well as legislation affecting biopharmaceutical pricing and

reimbursement activities and outcomes. Finally, a breakdown,

cyberattack or information security breach could compromise

the confidentiality, integrity and availability of UCB’s data

and systems.

Given these uncertainties, the public is cautioned not to place

any undue reliance on such forward-looking statements. These

forward-looking statements are made only as of the date of

publication of this Integrated Annual Report, and do not reflect

any potential impacts from the evolving COVID-19 pandemic,

unless indicated otherwise. The company continues to follow

the development diligently to assess the financial significance

of this pandemic to UCB.

UCB expressly disclaims any obligation to update any forward

looking statements in this Integrated Annual Report, either to

confirm the actual results or to report or reflect any change

in its forward-looking statements with regard thereto or any

change in events, conditions or circumstances on which any

such statement is based, unless such statement is required

pursuant to applicable laws and regulations.

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344

Report language

Pursuant to Belgian Law, UCB is required to prepare

itsintegrated annual report in French and Dutch.

UCB has also made this report available in English.

Availability of the Integrated Annual Report

The integrated annual report is available on the investor website

of UCB ( www.ucb.com/investors). Other information on the

website of UCB or on any other website, does not form part of

this integrated annual report

Financial calendar

April 27, 2023 Annual general meeting

July 27, 2023 2023 half-year financial results

Contact

Investor Relations

Antje Witte

Head of Investor Relations

Tel.: +32 2 559 9414

E-mail: investor-relations@ucb.com

antje.witte@ucb.com

Communications

Gwendoline Ornigg

Head of Global Communication

Tel.: +32 2 559 9626

E-mail: gwendoline.ornigg@ucb.com

Sustainability

Veronique Toully

Head of Sustainability, Corporate Affairs and Enterprise

Risk Management

Tel.: +32 2 559 9229

E-mail: veronique.toully@ucb.com

UCB SA

Allée de la Recherche, 60 – 1070 Brussels, Belgium

Tel.: +32.2.559.99.99 – Fax:+32.2.559.99.00

VAT BE0403.053.608

www.ucb.com

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