Dear Stakeholders:
It is hard to imagine a larger and more dramatic challenge in our lifetime than what all of us are facing due to the coronavirus pandemic. It is also clear that 2020 was a year quite unlike any other for QIAGEN.
Our QIAGENers – more than 5,600 employees worldwide – have stepped up to the tremendous challenges of these times. We took steps to protect our associates as our highest priority, especially for those on the front lines working closely with our customers in laboratories and hospitals around the world. It is with our deepest gratitude that we were able to support them in delivering critical solutions that have been essential in the fight against this pandemic. This included developing more than 10 new solutions for COVID-19 testing, while also significantly ramping up manufacturing capacity at our key sites in Germany and the United States. The contributions of QIAGEN to society have never been more critical. All of this is being done with an overriding commitment to achieve our vision of helping to make improvements in life possible.
We would like to thank our shareholders, customers, business partners and other stakeholders for honoring QIAGEN with their continued collaboration and trust.
QIAGEN delivered very strong results in 2020, supported by the demand for COVID-19 testing as well as improving sequential quarterly trends in our non-COVID product groups as the year progressed. We agree with our leadership team that QIAGEN is COVID-19 relevant, but not COVID-19 dependent.
QIAGEN exceeded our earnings and growth forecasts – which were repeatedly raised during the course of the year – for dynamic growth in net sales and adjusted earnings per share. (Adjusted EPS excludes purchased intangibles amortization, long-lived asset impairments and other items such as business integration, acquisition-related costs, litigation costs and restructuring.) We also generated significant benefits from the strategic initiative launched in 2019 to reallocate resources to support business expansion in our strategic growth areas.
As you know, the voluntary public takeover offer during 2020 by Thermo Fisher Scientific, Inc. did not achieve the minimum acceptance threshold from QIAGEN shareholders. From the time the proposal was announced in March through to the outcome in August, the magnitude and duration of the coronavirus pandemic have proven the increasingly critical importance of molecular testing to society, and also significantly improved QIAGEN’s business prospects.
Our Managing Board members – Thierry Bernard, who was appointed Chief Executive Officer in early 2020 after serving on an interim basis since October 2019, and Roland Sackers, our long-standing Chief Financial Officer – along with our Executive Committee members subsequently announced that QIAGEN will continue to execute a successful growth strategy as an independent company aiming to create significant value for shareholders and other stakeholders.
The anchor of this strategy is our focus on five pillars of growth. These are all product portfolio areas addressing markets with significant growth potential and ones in which QIAGEN can achieve/maintain a leadership position: (1) Sample Technologies used to isolate nucleic acids from biological samples, (2) the QuantiFERON technology used to measure immune response in patients to diagnose life-threatening diseases such as latent tuberculosis (TB), (3) the automated clinical PCR testing platform NeuMoDx, (4) the QIAstat-Dx solution used for syndromic testing, and (5) the QIAcuity series of digital PCR platforms. We are also supporting our leadership team in developing QIAGEN’s corporate culture as a new program called EMPOWER is implemented to enhance and strengthen a culture of greater accountability and agility with the organization.
My colleagues and I in the Supervisory Board have fully endorsed this strategy and look forward to working with our Managing Board members on the implementation. QIAGEN is moving forward from a position of strength with robust growth prospects, anchored by a differentiated portfolio and multiple new product launches in the pipeline. As we focus on greater value creation, QIAGEN has a disciplined capital allocation policy anchored by a healthy balance sheet to support investment in our business along with a commitment to increasing returns to shareholders.
As is the case every year, the Supervisory Board carries out a review process as part of best-practice governance procedures. This process in 2020 came amid the leadership of the Supervisory Board transitioning in August 2020 with my appointment as the new Chairman. This came after Dr. Håkan Björklund decided to step down as Chairman and as a member of the Supervisory Board. On behalf of my colleagues in the Supervisory Board, I would like to thank Dr. Björklund for his contributions to QIAGEN during his time on the Board and wish him all the best in his future endeavors.
The review process for 2020 included a focus on the composition of the Supervisory Board and also the outcome of the tender offer for QIAGEN that did not receive sufficient shareholder approval. This review process also included extensive discussions with our top shareholders and other stakeholders. We intend to continue these discussions in the future as part of our commitment to pursue the highest level of excellence in corporate governance.
As one of the outcomes of this review, we decided to further complement and enhance the Supervisory Board’s already extensive experience in Life Sciences and diagnostics. This led to the appointment of two leading international healthcare executives as new Supervisory Board members in recent months:
The target profile of the Supervisory Board can be found on QIAGEN’s website, as well as in the Governance section of this Annual Report. The current composition fully complies with this profile. Further information on the individual members of the Supervisory Board, such as gender, age, nationality and other positions relevant to the performance of their duties as Supervisor Board member, date of initial appointment and current term of office is set forth in the Corporate Governance and Compensation overview and on our website at www.qiagen.com.
The Supervisory Board considers all members of the Supervisory Board to fulfill the independence criteria as defined by the Dutch Corporate Governance Code.
The actions of our leaders during 2020 and the response to the pandemic have brought scrutiny to what we do at QIAGEN as well as how we do it. Indeed, how we operate as a company is driven above all by operating in a sustainable way. This commitment includes reviewing our activities in terms of ESG – Environment, Social and Governance – perspectives.
QIAGEN has been implementing programs to reduce its environmental footprint. In 2019 we pledged to reduce our emissions in line with a 1.5-degree Celsius climate target as laid out by the 2015 Paris Agreement. We have made good headway in 2020, with a reduction of 9.4% in scope 1 and 2 greenhouse gas (GHG) emissions and a reduction in business travel emissions of 81.8% compared to 2019 (the latter, in part due to the impact of COVID-19). We also far exceeded our 2020 goal to decrease plastic transportation packaging material by 3% below 2019. Our new goal for 2021 is to reduce by 9% below 2020 levels. Additionally, QIAGEN has a commitment to developing a diverse and inclusive culture. This is paramount for our success, and driven by creating a leadership team with a broad range of backgrounds, experience, skills and capabilities.
In nominating candidates for leadership roles, QIAGEN is committed to increasing diversity while pursuing individuals to join QIAGEN with a unique blend of scientific and commercial expertise and experience that will contribute to our future business success. Management development programs support the career advancement of leaders regardless of gender and other factors. As a result, a number of women are in key leadership roles around the world at QIAGEN, with over 30% of its management roles currently held by women. In line with this commitment, the Supervisory Board has had at least two women as members since 2011 and continues to take diversity into account when proposing members for election or re-election without compromising QIAGEN’s commitment to hiring the best individuals for positions without any discrimination.
In terms of governance, the Managing Board currently has two members, so achieving a diversity goal as measured solely by a percentage of overall membership is not foreseen in the near future. At the same time, QIAGEN has significantly increased the diversity of its senior leadership team and will continue to do so in the future. Our commitment remains as strong as ever to creating a diverse and inclusive environment for our employees.
In accordance with the Dutch Corporate Governance Code, the Supervisory Board devoted considerable time to discussing, monitoring and assessing QIAGEN's corporate strategy and its implementation, main risks and opportunities and the annual Management Board assessment of the design and effectiveness of internal risk management and control systems as well as any significant changes in them.
The Supervisory Board had five regular meetings and multiple ad-hoc meetings during 2020 that were held with the attendance of the members of the Managing Board. The Supervisory Board also met to review and discuss agenda items in the absence of the Managing Board members, such as performance and strategy as well as to discuss compensation matters.
All members of the Supervisory Board had adequate time available to give sufficient attention to the Company.
The Supervisory Board has established the following committees:
The Supervisory Board reserves the right to establish other committees as deemed beneficial, and has approved charters under which each of these committees operates. Charters are available on our website at www.qiagen.com.
The deliberations and findings of the committees were reported by the committee chairs to the Supervisory Board in its meetings on a regular basis. All committee members attended all committee meetings in 2020 physically, by video conference or by phone.
Further detailed information on the composition of the Supervisory Board and its committees, the number of committee meetings held in 2020 and the main topics of discussion, the remuneration of its members, as well as other information on the Supervisory Board, can be found in the Corporate Governance and Compensation overview, which is an integral part of this Annual Report.
The Supervisory Board conducted a survey among its members to evaluate the functioning of the Supervisory Board, its individual members, its Committees, the Managing Board and the individual members of the Managing Board and discussed the results of the survey in one of its meetings. Over all, the Supervisory Board concluded that all of the aforementioned were functioning properly, especially in view of the regulations set forth in the Dutch Corporate Governance Code, and should continue in the same manner.
A key objective of the Supervisory Board is to increase shareholder value on a long-term and sustainable basis. This is aligned with the objectives of the Supervisory Board to represent the interests of all stakeholders, including shareholders, while pursing the highest standards in Corporate Governance.
QIAGEN is committed to a corporate governance structure that best suits its business and stakeholders, and that complies with relevant rules and regulations. QIAGEN follows the principles described in the Dutch Corporate Governance Code, although some minor deviations, which are explained in detail in our Corporate Governance Report, may result from the impact of factors such as legal requirements imposed on QIAGEN or industry standards.
QIAGEN’s common shares are registered and traded in the U.S. on the New York Stock Exchange (NYSE) as of January 2018 (formerly on the NASDAQ Global Select Market) and in Germany on the Frankfurt Stock Exchange in the Prime Standard segment.
Shareholders in Europe and the U.S. hold the majority of common shares. As a result of these listings for its Global Shares, QIAGEN is subject to the rules regarding Corporate Governance set by the NYSE. QIAGEN believes all of its operations are carried out in accordance with legal frameworks, including Dutch Corporate Law, U.S. laws and regulations, EU regulations and applicable German capital market laws.
In this Annual Report, the financial statements for 2020 are presented as prepared by the Managing Board and audited by KPMG Accountants N.V. (Independent Registered Public Accounting Firm). We examined the financial statements, the proposal for the use of the distributable profit, the consolidated financial statements and the Management report. The results have been approved by the Supervisory Board and we have received an unqualified opinion from the external auditors.
In closing, the Supervisory Board would like to again thank all QIAGEN employees for the outstanding performance and commitment during an eventful year.
Venlo, the Netherlands, April 2021
The Supervisory Board:
Lawrence A. Rosen Chairman
