Q4 2019 Earnings Call
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I would now like in Jews, Arvind sued Vice President of Investor Relations Mr. suit you may now begin.
Okay. Thank you Ian and good afternoon, everybody. Thanks for joining us today.
So 20 910 was a year or that we made significant progress on our strategy and took steps to position us well for what will shortly be especially earned 2020 as with celebrate our fortyth anniversary.
What better gift to celebrate this important milestone tend to get back to revenue growth.
So our chairman and CEO , Bob Bradway will lead the discussion today.
We're also joined today by by our New CFO , Peter grip, and who will provide a financial update on our results for Q4 and full year 2019 and provide guidance for 2020.
Our head of global commercial operations Murdo Gordon will then review our product performance fodder buyer head of R&D day Reis will provide a pipeline update.
We will use slides to guide or discussion today and you should have received the link separately.
We also use non-GAAP financial measures in today's presentation and some of the statements would be forward looking statements. Our 10-K and subsequent filings identify factors that could cause our results actual results to differ materially.
So with that I would like to turn the call it over to Bob Bob Okay. Thank you Arvind and good afternoon, everyone and thank you for joining our call.
Heading into 2020, we feel ready for the challenges of a new year and we're feeling encouraged by the progress we made in 2019.
Once again this past year, we met and exceeded our financial targets.
We advanced key elements of our long term growth strategy and we serve more patients around the world, where they're growing portfolio of medicines.
2019 was the transition year, we had long been preparing for as many of our off patent legacy products feast new competition.
I believe we managed this transition well as evidenced by the fact that we delivered earnings growth in 2019 and will return to topline growth in 2020.
2019 drug prices in the U.S. actually Phil overall for the first time since 974.
In anticipation of this challenge we repositioned the company is expense base.
And and embedded productivity initiatives over the past several years that are serving us well.
In addition, we reshaped our product portfolio committing to medicines that can deliver growth for us primarily through volume increases rather than price increases.
Products like Repatha aim of big Prolia, if entity and most recently otezla.
In 2019, we delivered 3% volume growth globally, and 19% volume growth outside the United States.
We're seeing especially strong performance in our Asia Pacific region, albeit from a small base.
Over the next decade, we expect this region to account for as much as 25% of amgen's growth.
For the full year in 2019 volume in the region grew 62%.
Over two thirds of that growth came from our joint venture with a stellus in Japan, the world's first third largest pharmaceutical market.
Just a reminder, that this collaboration reverts fully to Amgen on April 1st enabling us to do business in Japan through a wholly owned subsidiary for the first time.
Our strategic collaboration in China, with Beijing closed a few weeks ago and we're excited by what our two companies can achieve together in the worlds second largest pharmaceutical markets.
2019 was also a watershed year for us where our bio similars business.
We've delivered our first several bio similars to market on time and on budget.
We believe where we are in the early innings of what can be an important growth opportunity for us over time.
Through the end of Q4, the business was already annualizing at over $1 billion, and we will add to our portfolio. Later this year with a lot of Sola our Biosimilar remicade.
We also expect that amateur veto our biosimilar humira in Europe in other parts of the World will benefit from our recent acquisition of Otezla.
A key pillar of our growth strategy continues to be bringing to market first in class or best in class medicines that deliver a large effect size for patients suffering from serious illnesses.
The world is growing older wealthier and more urban and these mega trends, meaning that the world will need more biopharmaceutical innovation not less.
We intend to be a leader and delivering that innovation.
We expect several important data readouts from our pipeline in 2020.
We expect data for AMG, five 10-K rest GE 12 see inhibitor.
Does it tell you meb and allergic and non allergic asthma.
From a captive in heart failure.
And look for Otezla and mild to moderate psoriasis.
In addition, we'd expect to generate some important data across our bites portfolio in 2020, as well and Dave Reese will provide details on all of this shortly.
Last year, we also expanded our commitment to discovery research strengthening our world, leading human genetics capabilities through a number of collaborations while adding large scale proteomic data as well.
We remain excited about how our approach is enabling us to identify and pursue new targets and the patients who stand to benefit most from them.
Everything we see in our company on across the industry continues to make us feel that we're living in an incredible age of biotechnology innovation.
Cross diseases were seeing more and more reason to be optimistic about the next breakthrough for patients.
At the same time, we know that governments and individuals and struggling with how to pay for these breakthroughs.
We accept responsibility to be part of the solution both in advancing innovation that really matters and in providing innovative ways for patients to get access to it.
In an election year, there's bound to be much discussion about health care and we look forward to engaging with other stakeholders to promote market based solutions that promote innovative medicines and affordable access to them.
Just as we recognize that we need to be a constructive stake holder to help sustain the robust ecosystem that exist for biotechnology innovation in the U.S. So to do we recognize an except the need to be part of.
The process of addressing other environmental social and governance matters that are of concern in our communities today.
Does that in several years ago, we set targets for reducing our carbon emissions and water consumption by the year 2020.
Having hit those targets in 2019, a year earlier than planned we're now developing the next set of goals that we will share later this year.
His goals will include a further commitment to our next generation manufacturing technologies, which have a much smaller environmental footprint than traditional biologics manufacturing and enable us to operate at a lower cost too.
Now, let me turn over the call to our new CFO , Peter Griffith, you'll recall that Peter joined US in October and he'll take you through the details of our performance in 2019, and our outlook for 2020, Peter over to you.
Thanks, Bob.
Let me begin by saying how happy I am to join Amgen is such an exciting time and the company's 40 year history.
I also want to take a moment to thank David Blaine the Amgen team.
As well as many of you on the call who have helped me transition into the role.
Over the last several months I've enjoyed meeting many of our investors as well as members of the analyst community.
And I look forward to the continued dialogue and engagement.
Now, let's turn to the fourth quarter financial results on page six of the slide deck.
Revenues at 6.2 billion decreased 1% year over year in the fourth quarter.
In the quarter, we sell worldwide product sales declined 2% to 5.9 billion as our portfolio transition with declines in our mature products substantially offset by our growth and launch products.
We're particularly encouraged by the strong 21% volume driven growth from our ex us markets.
Which gives us confidence as we continue our global expansion, including into China, which will also benefit from our collaboration with Beijing, which closed earlier this month.
Foreign exchange had a 1% negative impact to fourth quarter worldwide sales on a year over year basis.
Other revenues at 316 million were up 87 million versus Q4 2018.
Our Q4, non-GAAP operating income at $2.6 billion decreased 4% from prior year.
non-GAAP operating margin was 44.6% for the quarter compared to 45.3% in Q4 2018.
As previously indicated our operating expenses reflected the typical underlining underlying fourth quarter pattern.
Increased investment in our rapidly evolving oncology pipeline portfolio and additional operating expenses associated with the Otezla acquisition, which closed in Q4.
These increases were partially offset by continued favorable expense impacts from our productivity initiatives across all operating expense categories.
Other income and expenses were a net 65 million expense in Q4, representing 132 million of year over year favorability.
This favorability was driven by gains generated from liquidating bond investments to fund the Otezla in Beijing transaction.
And favorable market value fluctuations of publicly traded securities held in our ventures portfolio.
Actually offset by lower interest income due to reduced cash balances.
The non-GAAP tax rate was 14.9% for the quarter, a 1.6 point increase versus Q4 2018.
Primarily due to a one time prior year tax benefit associated with intercompany sales under us corporate tax reform.
non-GAAP net income was 2.2 billion and non-GAAP earnings per share increased 6% year over year for the fourth quarter supported by a 7% reduction in share count versus Q4 2018.
Next I will review our 2019 full year results on page seven of the presentation.
Our 2019 full year revenues decreased 2% to 23.4 billion.
While our non-GAAP earnings per share grew 3% to $14.82 per share.
For the full year, we saw 1% decline and worldwide product sales to 22.2 billion.
Volume growth in markets outside the U.S. was 19% year over year.
Other revenues at 1.2 billion were down $56 million year over year.
For the full year non-GAAP operating income at $11.2 billion decreased 6% from the prior year.
And our non-GAAP operating margin was 50.2% for the year down from 52.6% in 2018.
In total non-GAAP operating expenses increased 3% year over year to 12.2 billion.
This growth was driven by research and development research and development investment launch product support and the addition of Otezla to our business, partially offset by a productivity program.
Other income and expenses were favorable by 250 million on a year over year basis, due primarily to gains in 2019 from liquidating bonds to fund the Otezla in Beijing transactions, partially offset by lower interest income, resulting from reduced cash balances.
The non-GAAP tax rate was 15% for the full year up 1.5 points versus 2018 again, primarily due to a onetime prior tax benefit associated with intercompany sales under us corporate tax reform.
Turning next to cash flow in the balance sheet on page eight.
For the full year 2019, Amgen continued to generate strong cash flow, reflecting a diversified portfolio of products, coupled with an industry leading cost structure.
Free cash flow was 8.5 billion in 2019 versus 10.6 billion in 2018.
The decline driven by lower net income timing of working capital and an advanced stacks deposit.
In 2019, we returned a total of 11.1 billion to shareholders through dividend payments totaling 3.5 billion and 7.6 billion used to repurchase 40.2 million shares at an average of $190 per share.
And this follows the 21.4 billion return of capital to shareholders in 2018.
Cash and investments totaled 8.9 billion at the end of 2019.
Decrease of 20.4 billion from the end of 2018.
This decrease was primarily driven by the Otezla transaction cash returned to shareholders in the form of dividends and share repurchases as well as debt repayment, all partially offset by free cash flow generated during the period.
Debt outstanding at year end totaled 29.9 billion and carries a weighted average interest rate of 3.7% with an average maturity of 12 years.
Now turning to the outlook for the business for 2020 on page nine.
2020 will be another important year frampton as we continue to invest in the pipeline to generate innovative and differentiated molecules build out the global business and support the growth of our new products.
As previously discussed in anticipation this opportunity and continued downward pressure on net prices, we developed the productivity capability to enable us to fully indexed from a position of strength.
Our 2020 revenue guidance is 25.0 billion to 25.6 billion.
And our non-GAAP earnings per share guidance this $14.85 per share to $15 in 60 cents per share.
GAAP earnings per share guidance is $10.85 per share to $11.65 per share, which diverges from non-GAAP EPS, primarily due to the amortization of intangibles related to our Otezla acquisition.
Our non-GAAP tax rate guidance is 13.5% to 14.5%.
Once again, we expect capital expenditures of approximately $700 million this year, including our industry, leading environmentally friendly next generation manufacturing facility in Rhode Island.
Let me mention several key assumptions embedded in our guidance.
First our revenue guidance range reflects continued strong worldwide growth from products, including Prolia of entity Repatha aim of Vic Otezla and our Biosimilar portfolio.
At the same time, we expect increasing competition against our Filgrastim any say franchises as well as sensipar.
Next with regard to net selling prices, we experienced a 5% decline globally in 2019 for 2020, we expect to again experienced low to middle single digit declines globally, we expect our volume growth to more than offset the net price decline.
Overall as previously stated excluding Otezla, we expect our base business to be stable in 2020 on a year over year basis.
As you model revenue in 2020 note that historically, the first quarter represents the lowest product sales quarter of the year.
As a percent of the full year product sales for the first quarter should look similar to the percentage we saw in Q1 of 2019.
Murdo will explain further in his remarks.
With respect to other revenue, we expect about $1.1 billion for the full year 2020, as we anticipate increased competition against our royalty product portfolio.
From an operating expense perspective overall, we expect 2020 total non-GAAP operating expenses to grow in the low double digit percentage range year over year on an absolute basis.
As previously communicated we reiterate the following three assumptions.
non-GAAP R&D investments to increase as we invest in our advancing innovative pipeline program and new Otezla indication.
Partially offset by R&D recoveries received from our Beijing collaboration.
Second non-GAAP SGN, a expense to increase due to the acquisition of Otezla as well as modest incremental investment in support of our base business as we continue to expand globally, including China, and Japan grow our bio similars business and begin product launch preparation for our late stage pipeline.
non-GAAP cost to sales as a percent of product sales to be generally consistent with 2019.
We expect all expense categories to continue to benefit from our productivity program.
We anticipate non-GAAP other income and expense to be a net expense in a range between 1.2 billion and $1.4 billion.
This is primarily driven by lower interest income as a result of cash used to fund the otezla in Beijing transactions.
As well as our 20.5% share of Beijing's results based on current publicly available consensus estimates.
I note that our 20.5% share of Beijing's results will be booked one quarter in arrears in accordance with the equity method of accounting and therefore begins in Q2 2020 .
As you know on April 1st 2020, Amgen will purchase the 49% of shares and Amgen and Astellas bio pharma that our head held by Astellas for a nominal fee, making the company a wholly owned Amgen subsidiary.
First let me say how excited we are about this transition as it marks the achievement of our long term strategic objective.
We look forward to further leveraging this platform as we seek to bring amgen's, new medicines to patients in the third largest pharmaceutical market.
From a financial perspective, we anticipate limited near term financial impact, resulting from this transition.
Now with regard to capital deployment.
Our actions will continue to reflect the following principles.
First we will invest in our business to expand our pipeline of innovative medicines and to seek to drive long term volume growth globally.
We will also invest and prudent external business development opportunities.
Second.
We remain committed to returning capital to shareholders in the form of growing dividends, including the 10% increase in the first quarter of 2020 to $1.60 per share.
As well as continued share repurchases.
We will continue to take an opportunistic view towards the timing of share repurchases within 2020.
We expect share repurchases within a range of $3 billion to $5 billion and have an authorization outstanding in the amount of 6.5 billion.
And third we remain committed to maintaining an optimal capital structure in order to minimize our weighted average cost of capital.
And retain our investment grade rating.
Consistent with our usual practice our guidance today does not include the impact of potential external business development activities.
So in summary, we.
We delivered another year of strong financial results in 2019, and we remain confident and the outlook for Amgen success in 2020 and beyond.
This concludes the financial update I will now turn the call over to Murdo. Thanks, Peter and good afternoon, everyone I'll take a few minutes to reflect on 2019 than review Q4 in greater detail.
In the 40 years since incorporation amgen's product portfolio and geographical footprint has changed dramatically.
On our Fortyth anniversary, we reflect on the pioneering innovative spirit of our early Amgen Im pleased that transformed the treatment of disease.
Our mission to serve patients remains unchanged and that motivates us every single day.
Accomplishments on behalf of patients in 2019 gives us further confidence about our future as we enter 2020 .
To summarize 2019 for the full year, we grew volume by 3%.
The growing proportion of our portfolio posted 35% year over year volume increases. This portfolio is diverse and includes products such as Prolia if entity Repatha aim as they will Tesla MTV to our six hematology and oncology brands as well as and vasey and can ginty.
Finally, our international business contributed 19% volume growth in 2019, notably year over year revenues for our businesses in China, and Japan grew nearly eight fold. These markets are long term growth engines for Amgen and our collaboration with Beijing, along with our acquisition of Tesla will accelerate.
Our expansions in the second and third largest pharmaceutical markets.
Now moving to fourth quarter results.
Volumes grew by 3% year over year.
In Q4, net selling prices declined 4% year over year, resulting in reported net sales declining by 2%.
As Peter mentioned, we have a stable outlook for our base business for 2020 and with the addition of Otezla. We expect revenue growth. This year. Despite projecting continued declines in net selling price on a portfolio basis.
Now getting into product details prolia delivered 15% growth year over year, driven by higher volume from increasing rates of new patient growth and strong repeat injection rates recall that given twice a year dosing prolia experiences consistent seasonal trends.
As energy posted $85 million in the fourth quarter, driven by strong uptake in both Japan and the U.S.
Every year worldwide 8.9 million fractures occurred due to lost steel process. That's one fracture every three seconds and only 20% of women who experienced a fracture are treated with a bone building medicine.
Given the Underpenetrated nature of this market, we continue to focus on ensuring post menopausal women receive appropriate screening diagnosis and treatment.
With Prolia and as entity with excellent treatment options to offer these patients.
Onto Repatha Q4 sales grew by 26% year over year as we continue to be the leader in the Pcsknine class worldwide unit growth was 67% year over year and new to brand us prescriptions are steadily improving going at 61% year over year.
We've taken significant steps and have made major progress in improving access and affordability for repatha.
We removed the original list price offering we simplified and improve prescription approval rates in commercial plans and we have increased the percentage of Medicare patients up to 70% that can access repatha at a more affordable propane.
Although the blended net price repatha in the U.S declined in Q4 versus the previous year net selling price was relatively stable sequentially.
For 2020 , we expect a step down in Repatha as net selling price in Q1 based on our contracting to obtain broader access with stabilization thereafter.
Now on team as big on Slide 16 on a year over year basis volume grew 27%, while net sales grew 3%.
As a reminder, Q4 2018 benefited from 20 million a favorable changes in accounting estimates impacting the year over year comparison on a quarter over quarter basis unit volume grew 9%.
To date, almost 300000 patients have been prescribed AMETEK by more than 33000 prescribers considering that there are 4 million migraine patients in the U.S., who are eligible for see GRP treatment aim that big has significant potential remaining to penetrate this market and we expect to drive volume growth.
Over the four over the course of 2020.
And we'll take leads in both new to see GRP prescriptions, and total prescriptions, which exited Q4 with a 48% trx share.
Innovate has exceptional access with over 80% of prescriptions paid and over 92% of lives covered.
As a result of this broader access we expect net price to declined slightly on a full year basis for 2020, when compared to the full year 2019. Additional Inc. Q1 has lower sales in subsequent quarters due to the impact of benefit plan changes insurance Rivera vacations, and greater co pay expenses as patients work through.
Their deductibles.
We'll move to parse it does on slide 17, which grew by 49% year over year in the fourth quarter independent and mid size dialysis providers already utilize possible for a majority of their calcimimetic patients while FMC into veto continue to increase adoption.
Next onto a Tesla.
With the health of the <expletive> dedicated professionals that have joined our team from Celgene. We will continue to drive strong sales growth and launch potential new indications for Otezla.
During the period since acquisition close prescription momentum continued with 13% year over year growth.
Our seamless integration efforts combined with planned label and geographic expansion gives us confidence in our ability to grow Tesla at low double digit compound annual growth rate over the next five years.
For the approximately five weeks post closing in 2019 will Tesla sales were $178 million.
We expect first quarter sales to big proportionately lower than in the remaining quarters of the year the quarterly pattern for Otezla and 2020 should approximate the historical pattern over the last number of years.
Moving on to Enbrel sales increased 2% year over year, driven by 66 million dollar favorable change in accounting estimates and increases in net selling price, partially offset by unit volume declines.
Volume trends in 2020 are expected to be similar to those in 2019.
Our net selling price we project limited benefit in 2020 versus 2019 due to less favorable contract terms.
With two highly complementary products targeting psoriasis and Psoriatic arthritis, we see an opportunity to strengthen their positions in the market more broadly, we're increasing our focus and inflammation through our broad portfolio, which includes our bio similars Amgen visa and us Sola, our late stage assets as Italian map and a number of other early.
The assets in the R&D pipeline.
Now to our hematology and oncology business, which is highly integrated with our oncology biosimilars that I'll discuss later, our innovative portfolio six brands exchange, Eva Kyprolis and plate Vectibix Blincyto, an logic collectively totaled $1.2 billion in the quarter growing 10% year over year.
[music].
As for some of the larger brands within this portfolio achieve a grew 7% in Q4 year over year, driven by 4% volume growth Kyprolis grew 6% year over year, driven by volume led by 12% increase in the U.S. and U.S sales and flea grew 15% year over year driven by volume our investments.
In R&D frankly have resulted in two innovations first we recently launched a smaller presentation at a 125 micrograms in support of the in place pediatric indication as the product is administered with weight based dosing.
This new presentation will also help to minimize general product wastage for ATP patients across all indications second and plate received approval in October for the treatment of early TP, which gives us a chance to serve patients earlier in the course of their disease and provides the opportunity for treatment free.
Remission.
Now onto our more mature brands in Q4, and Alaska sales declined 43% year over year with a 42% decline in the US recall that Q4 2018 benefited from a $55 million BARDA order, which did not repeat in Q4 of 2019.
Coinciding with the emergence of us Biosimilar competition. The most recent CMS published ASP for Neulasta reflects a 10% reduction bear in mind that ASP is calculated two quarters in arrears.
On a volume basis in Q4 us Neulasta retained an exit share 74% of the long acting segment with on pro holding an exit share of 55%.
We're encouraged by on pros durability, demonstrating confidence that our customers have in the reliability and quality of our supply along with our broader customer services.
We know face a third biosimilar competitor in the U.S. and other potential competitors remain in development.
As you model Neulasta sales for the first quarter recall that Q1 2019 benefited from a $98 million BARDA order that we do not project to recur in 2020 .
Finally outside the U.S. sales declined 48% in Q4, and we expect those trends to continue.
Switching to nephrology, starting on slide 25, Q4, Epogen sales declined 20%, primarily due to lower net selling price from our contractual commitment with Davita, which calls for a further price reduction in 2020.
Meanwhile, our ines declined 10% year over year, driven by lower volume due to increased competition.
Regarding sensipar recall that in the U.S. there were several at risk generic launches in 2019, the resulted in year over year sales declining 76% to 107 million in the quarter.
In 2020 supplemental patent protection certificates for Ciena, Kalsi expire in France, Germany, Italy, Spain, and the United Kingdom, which will likely result in a significant decline in ex U.S sales in 2020 .
A close the product section with our Biosimilar portfolio, which is highly integrated with our innovative business throughout the company as examples a majority of these products were made with the same manufacturing network as our innovative brands. We also leverage the same supply chain for distribution and on the commercial side, we continue to identify.
Synergies in commercializing, our biosimilar along side, our innovative products, making it a highly efficient selling model and allowing us to rapidly apply learnings across our portfolio.
We also offer the same provider and patient services as with our innovative portfolio.
These advantages are increasingly important as we know face additional biosimilar competition to can ginty and investee and expect other competitors to enter during 2020 .
Our Q4 Biosimilar portfolio comprised of can ginty and invest in the U.S. and Amgen VTEC ingenuity and embassy outside the U.S. recorded sales of $258 million.
In the U.S. can ginty and invest CCH recorded $79 million of sales and we've seen very encouraging adoption rates in the clinic segment and hospital adoption is accelerating.
Given the early stage of launch there was also some inventory stocking during the quarter.
Ex U.S sales from our bio Similars were $100 million OLED by on Jovito, We continued to see important differences between products and markets in terms of uptake in price erosion with some markets experiencing strong uptake at more discounted pricing levels, while other larger markets, including Germany, and France is.
Exhibit a more balanced and sustainable opportunity.
Here again, we're able to leverage our expertise and footprint in oncology, while MTV to fr synergize nicely with Otezla and.
In summary, 2019 was a solid year given the evolution of our product portfolio and 2020 , we plan to drive volume uptake of our growth portfolio of products and not including Otezla, while defending our mature brands, let me know turned over to David.
Thanks, Murdo and good afternoon, everyone.
As we enter 2020, we're looking forward to important clinical data from programs across our three therapeutic areas inflammation oncology cardiovascular disease, I'll say more about loan college in a moment would relate to take the opportunity upfront to express our enthusiasm for the Beijing collaboration we're off to a good start.
Forward to working together to advance the global development of our pipeline of innovative oncology molecules.
I will now begin my quarterly review and inflammation.
We expect the Tesla data this year from a phase three study in over 500 patients with mild to moderate psoriasis that have failed topical therapy.
This patient population has no approved oral therapy available and we're confident that hotels will make up provide a much needed treatment option.
We're working with the CHF impede toward a base shuts indication in Europe , and with the FDA and inclusion of the scalp psoriasis data in the U.S. label this year.
There are also ongoing studies for new indications, including pediatric psoriasis and we're evaluating additional studies to expand the opportunity for Tesla.
I'll also remind you that later this year, we expect phase three data from our Ts LP antibody as opposed to map in development with Astrazeneca and severe uncontrolled asthma.
In bone health, along with you CB, we were pleased to received European approval for of entity for the treatment of severe osteoporosis and post menopausal women at high risk of fracture.
Venting the as the first new osteoporosis medicine approved in Europe in the last decade.
Testament to the need for a new therapy that can rapidly build bone.
Turning to oncology in hematology, we continue to rapidly advanced the development program for AMG 510, our first in class key Ras 12 see inhibitor.
We enrolled the potentially pivotal phase two monotherapy study and advanced non small cell lung cancer and approximately three months and look forward to sharing data later this year when we have at least six months follow up on all patients.
I previously mentioned that we had enrolled a cohort of advanced colorectal cancer patients in our phase two monotherapy study.
Based on the data we have generated to date, we have opened the study to further enrollment and we'll assess our potential development path in colorectal cancer as additional data become available.
We also expect to present additional data later this year from our first in human monotherapy study in solid tumors.
Where we will have more information on duration of therapy as well as data in tumor types other than long and colon cancer.
We also expect initial data from our phase one combination study with Keytruda in advanced non small cell lung cancer.
We are enrolling advanced call colorectal and non small cell lung cancer patients in our mek inhibitor combination study as well as treatment naive non small cell lung cancer patients in our ongoing phase one monotherapy study we continue to plan additional studies, primarily combination trials and we will provide updates as the.
Program progresses.
We remain enthusiastic about our bite platform in 2020 will be an important year.
Based on emerging evidence of anti tumor activity in both hematologic malignancies and solid tumors, we are growing increasingly confident in the half life extended format.
As we advance our bite clinical programs and different tumor settings, we are gaining important insights into dose and schedule and management of adverse events, such as cytokine release syndrome.
These insights will guide customize development approaches depending on the target and underlying disease biology.
Over the course of the year, we anticipate sharing data from some of these programs and I will provide further guidance on expected data presentations as these molecules advance.
We're now pursuing to half life extended by programs for gastric cancer and recently initiated a first in human study for AMG 199, which is directed against Muck 17, a target widely expressed gastric cancer.
Gastric cancer as you know is highly prevalent in east Asia, where we have a growing presence through our impending Japan subsidiary in collaboration with Beijing.
As I previously discussed we intend to present the data for AMC seven to one or half life extended bcm may bite when we have a meaningful dataset most likely in the second half of this year.
We've also made several regulatory submissions in oncology, including the cupola candor study in the us.
Cupolas, plus dexamethasone in China for relapsed and refractory multiple myeloma and when Cyto in China for relapsed or refractory CLL, we look forward to working with Beijing to advance these important medicines.
In cardiovascular disease, along with Cytokinetics, we look forward to the data from the Omecamtiv Mecarbil phase three outcome study in the fourth quarter of this year.
Heart failure treatment landscape is expected to change based on recent data from other drug classes, we believe significant residual unmet medical need remains in this global epidemic.
Also in cardiovascular disease are LP literally ESI are in a BMG 890 continues to advance and we expect to initiate phase two development in the first half of the year.
Finally on bio Similars, we're pleased to receive us approval for apps Sola, our biosimilar remicade and to make our us regulatory submission for HBP 798, our Biosimilar rituxan.
I'm also pleased to announce that we are initiating a phase three study with our sevens Biosimilar Edp 938, our biosimilar aflibercept or I Leah.
Okay. Thanks, Dave why don't we open the lines up for questions now and please remind our callers the process.
Ladies and gentlemen.
As a reminder, if you like to asking audio question. Its darwan on your telephone keypad, if you'd like to withdraw your question typically press the pound.
And please remember to keep yourself to one question. So we can you to everyone in our.
Our first question. This line of Jay Olson from Oppenheimer and company Jane.
Hi, guys congrats on a corner and thanks for taking the question.
You talked a little bit about pricing dynamics for moving could you.
Maybe elaborate a little bit on how you expect the competitive dynamic to shape up in the few GRP space and.
Any long term data you could potentially.
Leverage there thank you.
Thanks, a question Jay as Murdo here.
We're very pleased with Amazon rigs market access position, though with over 92% of covered lives having access to him as they get a very affordable copay. We're also pleased with the addition, this year of Cvs.
Last year, we Didnt know, how Cvs is a benefit.
With him as a benefit and we do as of the beginning of this year and we've already seen an acceleration in our new patient uptake.
We are happy that the percentage of patients that are receiving paid prescriptions NAV of Amazon is above 80% and that bodes well for the future growth of this category because we've got highly effective medicines that have an impact a significant impact on the reduction of migraine days.
On migraine sufferers and we have all all of them, there's 4 million eligible patients out there in the us and they are able to access a mosaic at a very affordable co pay so so thats good for for the future outlook of the category.
Obviously, because we did contract to secure that additional access there will be a.
Reduction in our net selling price that you'll see in Q1, and then we expect it to be relatively stable over time now because this is a retail benefit product you do see some fluctuations as you make true ups in the mix of your product that comes through Medicaid commercial or to some extent Medicare part D. But.
Overall, we would expect post Q1 stability and net selling price.
Screw. The next question to you and our next question is one of Michael from Jefferies Michael.
Great. Thanks for the question I had a R&D question for David to of course, there's a lot of attention on AMG. Five can you made a lot of great comments about how you quickly enrolled the study and we're going to get data later this year I wanted to things that picked up on what's your comment about first line lung can you just maybe make a comment about how that advances or how that progression. How you go up.
Got a first line.
Strategy, that's obviously a huge opportunity shelf, maybe just comment about where that monotherapy study caution where you can go in first line. Thank you.
Yes, Thanks, Michael that is intended to provide a potential treatment option for patients who are not eligible for.
Other first line lung therapies or unwilling to take such therapies.
I think it will provide incredibly valuable clinical information on response to the drug in the previously untreated population. We've just started enrolling that so over the course of the year as we generate data will provide guidance as to when we may have some things to share.
And our next question line of Chris Raymond from Piper Sandler Chris.
Thanks for taking the question just on M&A priorities.
Bob I was kind of struck a couple of weeks go in San Francisco.
You guys talked about renal as maybe an area.
Of interest in terms of building out the pipeline in the you're offering and obviously augmenting what is a pretty formidable business now but.
I think the wording that I heard you say Bob was that any any asset you bring in would have to be game changing so maybe two parts can you talk about the reasoning for this sort of focus on renewal or leased articulating that to US and then what are you really looking for in terms of the game changing therapy.
Yes.
So Chris just to remind you we we have six commercial franchise areas of which nephrology is one obviously that was our first two we've been a leader in that area now for several decades, we have a number of important products for nephrologists today in.
We intend to continue to serves the needs of patients.
Physicians and providers et cetera in that community, we have not found in our own discovery research efforts that we've been able to find.
The kinds of.
Game changing innovation that we want to invest in from discovery standpoint, So we're not investing in discovery research and nephrology right now, but we are going to look for business development opportunities there.
And in general our strategy when it comes the business development is to look for medicines that make a big difference for patients suffering from these diseases. So we'll look for innovation and large effect size I don't know that I used the word game changer, but if I did this would I was intended to reflect the notion of large effect size.
Innovative medicines, so to the extent there are some in the industry.
Or otherwise medicines, where again, we think because of the historical investment. We've had this community patients that we can add real value will look.
And our next question line of Brian Skorney from Robert W., Baird and company Brian .
Hey, good afternoon, guys. Thanks for taking the question.
One quick one actually two quick ones on housekeeping, just looks like compared to last quarter, you saw 6% decline in new last the market share you just break out how much of that was.
On pro loss and can you also talk about how on pro price has been impacted by the Biosimilars have been able to maintain price. So far have you taken greater discounts to maintain that share. Thanks.
Okay. Those are good questions for Murdo onshore had murder, yes. Thanks, Brian .
The majority of the share decline is from the Prefilled syringe on pro exited at 55% share of long acting Filgrastim and continues.
To hold up well in terms of share.
We have had a contract out there that that provides some discount to on pro.
But it's it's.
A more modest discount than you would see on that Prefilled syringe.
And our next question as one of Evan Seigerman from Credit Suisse Evan.
Well. Thank you for taking my questions I want our biosimilar. So what are some gating factors to achieve I think its multibillion dollar you had at one point at greater than $3 billion and sales across the franchise.
And if there would it be implementation of an international pricing index or most favored nation clause for Medicare part B, how would that potentially impact your biosimilars business. Thank you guys.
Well I can take a stab at the first part of your question.
Murdo invite you to jump in but since we made those undertakings before you were part of the team Murdo that the notion that we articulated was that we were going to advance a portfolio of up to 10 bio similars.
We expect that the these could be an attractive growth opportunity for the company and we're off to good start as you heard me say earlier at the end of the fourth quarter. We are annualizing, an excess of $1 billion. So Roger good start run time, we're on budget with these programs and the gating.
Item is simply.
Product approvals and product launches so.
We remain enthusiastic about our chance to earn a return from these products and.
And as to the specifics of Ipi.
To say in general, we obviously would would be concerned we think quite a few other stakeholder groups would as well about.
The disruption that ipi would represent to the innovative biopharmaceutical industry and.
We think there are better ways to to evolve our system in a way that ensures patients have access to medicines at affordable prices, but murdo feel free to do you want to add anything specific about IPO biosimilar and it's nothing on Ipi, but I think you summarized it well and on bio Similars only thing I would say is.
Thankful to other inherited this portfolio and for the decisions that were made prior to my arrival I think this is strong business opportunity. It's it's been one we've been able to realize very good competitive share in Europe , and we're off to a very good start.
In our early launch in the U.S. and I look forward to being able to launch more products.
And our next question is one of Kennen Mackay from RBC capital markets Kennen.
Hi, Thanks, so much for taking my question Congrats on the end of year in 2019, I totally agree one transformative.
Maybe for murder I was wondering if you could talk a little bit about the synergies youre seeing or expecting between selling and focus on enbrel and whether there were any tailwinds there through year end formulary rebating or contracting negotiations we should.
Think about pricing or access to New York.
Thanks, a question Ken.
Yes, we're excited about potential synergies between Otezla and bell and quite frankly by extension, our bio similars business coming into the inflammation category.
Too early to comment on specifics, but we continue to work through our contracting strategy promotional strategy.
Even things as simple as possibly expanding into primary care promotion, because we have a fairly large primary care footprint.
And then clearly our international geographic expansion is augmented by having otezla.
Joining our portfolio with potential new markets, where perhaps otezla was was slated to be launched by distributors. When we have a full blown affiliate in some of those markets and then the last pieces of course synergies as we go into some of the new indication areas. So I am excited about building those are two.
Those are working hard to realize those synergies and.
I feel optimistic that we'll be able to be more specific in upcoming quarters.
And our next question is one of tumor response from Evercore ISI tumor.
Hi, Thanks, so much for taking my question I am just extraordinarily confused today on the guidance.
But I'll limit my question to too specific things perhaps.
First Peter on the away any line if you can bear with me for a second.
You mentioned 1.2 to 1.4 billion and I was trying to think through and I thought to myself 30 billion depth at just above 3% rate. So that's a billion dollars an interest expense minus about 100 million of the interest income. So that's 900. So when you guide to 1.21 0.4, that's effectively implying three to 500 million for Beijing, but.
My understanding was the only booking 20% and Im just trying to understand is bgs implied net income 1.5 to 2.5 billion or am I thinking about that wrong.
Does that sound so much higher than what between does that's number one.
And secondly on revenues I noticed.
I know the business is being implied flat year over year outside of that has less so I just wanted to understand better what the pushes in.
Pulls are there and.
And perhaps also I think it mentions biosimilar is doing a billion dollars in 2020 annual for Q1 9 alone was north of billion run rate. So just trying to understand all the thank you very much.
Okay tumor was trying to go through that I think there were three questions there.
So a murder you weren't tick through the first two on the revenue.
Just clarify what we said and then you can help clarify the oil and other interest expense line.
Sure. So yes, we've guided that our base business will be stable.
Year over year, obviously, there are a range of outcomes on that portfolio and we continue to work hard across.
A number of opportunities too.
To do as we've done historically and that is to outperform.
I would say that or Tesla has come in and we have seen very good.
Seamless integration of that team and that performance of that product in the growth trajectory continues with.
Without any interruption through the fourth quarter and we're seeing strong weeks early in the new year.
On bio Similars.
It's very early in the launch of those two products, where we are annualizing as you pointed out at over 1 billion based on fourth quarter, and we expect to be able to continue to accelerate that business.
Whom are Peter here. Thanks for your question.
I would.
Take you to the SEC that our total debt.
At the interest rate I talked about nine.
Remarks at 3.7%.
Average maturity 12 years by the way I mentioned that too.
That plus the 20.5% of Beijing's results for 2020 the publicly.
Available consensus estimates are or what we're guiding to so when you.
Work through those two you should get pretty close to our 1.2 to 1.4 billion for 2020.
And our next question is one of Robyn Karnauskas from Suntrust Robinson Humphrey Robyn.
Hi.
I want to Peter Dameris, but I guess Im continues to justify this lack of quarterly.
Your side kind of outline.
Cost like half that I'm first holding.
Your growing like a bunch of different products. So.
So one thing you stake is going to prevent you from growing more this year and not just having a stable business year over year like touch sorry, what I'm just struggling less about just help me understand because the way you describe it looks like smart growth on top line. Thank you.
Sorry, rum repeat the last Peter last piece your question.
Well I wanted just like.
The way you're describing our business is saying are required.
Basically is that you're growing many parts of the business and the part that is declining.
Maybe potentially stabilizing on pro.
So what is preventing you from growing beyond what you're guiding there is there one particular thing I think most I was there sitting there, saying why can't you grow more than what you've outlined given.
The the picture that you painted the business being actually quite strong.
So I would agree with your last comment of pitcher the business does look quite strong we're pleased with what we've been able to achieve particularly in the back half of last year.
As I mentioned earlier some of the new last us stability with on pro has been at the expense of contracted terms, which will lower the net price. So that that total portfolio inclusive of on pro and we would expect with additional competitors against it neulasta in the Biosimilar space that there will be further net.
Price erosion in the long acting Filgrastim category and of course overall in our total portfolio worldwide. We would expect single digit net price declines for the year note that goes up against what I've talked about.
Throughout the call is we have a number of really strong growth drivers in a young portfolio very diverse products and we have guided a wide range on revenue and it's my hope that the strong execution. We saw in the back half of last year continues into this year and we can achieve.
A good growth profile not just in otezla, but in the base business.
And our next question is one of Terence Flynn from Goldman Sachs Terence.
Hi, Thanks for taking the question Omecamtiv as a product you guys haven't talked a lot about reason, we obviously from phase three data coming later this year, Dave you mentioned it in your and your remarks as well in terms of kind of the change in treatment landscape, but just curious if you could rise to the puts and takes for the program.
As we think about the probability of success here and what would really did you guys excited.
The type of data thank you.
Yes, sure Terence I. This is Dave Im happy to address that.
As I mentioned in my remarks.
Heart failure is a global epidemic.
What makes us.
Continued to have excitement in OMA captive its.
First in class mechanism of action is so only drug ever introduced that actually acts directly on the hard sell to improve contractility or the hurts pumping function.
And we're conducting a what will be a definitive 8200 patients give or take.
Trial.
In patients with advanced heart failure is a fairly sick population, where we're going to be looking for.
You know mortality benefit and a variety of other clinical outcome measures that improved so I think theres, a large amount of residual unmet medical need.
And obviously, where this fits in the train changing treatment landscape will depend on the profile it emerges from that phase three trial.
And our next question this line of Ronnie Dol from Bernstein Research Ronnie.
Good afternoon, congratulations on the night 29 team and.
Got caught one housekeeping and one question and then a quick one as I was wondering if you could give us.
Comment on that Medicaid block grant that Jess was announced today does that hasn't been relevance to you in angelic, where do you expect it will impact the drug industry and second David I was wondering if you can give me your view on them more Sloan Kettering paper, suggesting the targeting the active GDP bound form of K last is better than trapping.
GDP, Okay last in the inactive form in terms of presenting tumors tumor resistance to those agents.
Good well, let me go knock off the Medicaid piece first running.
For those who are on the call weren't aware CMS released some guidance earlier today, so we and others are still chewing through it I think you'll have very limited impact first relevant for us but.
It's likely to be relevant from those states that didnt opt into in the first instance, some.
We'll go through it as we launch arrows in our industry more closely to see whether any specific issues for our business but.
It didn't seem to me Ronnie that was going to be a concern for us in 2020, Dave you want to talk a little slow.
Sure you don't want to address Outland Bob.
[laughter].
We reported for those who arent familiar Iran is referring to paper that came out within the last month or so that suggest that also targeting the GDP bound form of Tirasemtiv 12 see would be required for signaling inhibition.
We read the paper with interest of course.
Ill make a couple observations first I would say our own data with AMG 510 suggest that at the appropriate doses and doses that we can achieve clinically we can completely suppressed signaling throughout a dosing interval.
It is also my.
Understanding or belief that the GE 12 see inhibitor use than that.
Paper may have been a little less potent and one thing that we've learned over 40 years in oncology is that if you.
Incompletely inhibited target you very quickly breed resistance so.
I would say I feel very confident based on the preclinical data that we've generated with a AMG 510, we're of course profiling tumors across our clinical program to try to generate signatures of response and resistance. This is the sort of thing that we'll look at but I don't see anything in the literature as of yet that Dissuades me from the.
Approach, we're currently taking.
And our next question is one of Mohit Bansal from Citi.
Great. Thanks for taking my question Ed.
One quick question on that is not in my view mortgage psoriasis.
Seems like you have data later, this yet, but given that might affect kind of a standard of care in that particular market and the genetic what sort of calendar do you anticipate.
As late in that market and how do you think of bulk navigating those challenges there. Thank you.
Yes, I will let me.
Let me started to move it and then I'll ask murdo to jump in.
So in mild to moderate psoriasis, they're currently no approved oral therapies.
The only thing really available to patients right now.
Topical therapy, many of them will not ultimately experience disease control with those topical therapies and so we think there's real opportunity for.
Otezla in that area. There are up to six nearly 6 million patients are with mild to moderate psoriasis.
In.
In the United States alone So think about gives you.
The sense of the size of this opportunity and actually the prevalence disease.
Murdo yen Mohit, the only thing I would add is yes, there's theres some methotrexate use there, but it's largely a topical business as Dave described and it's largely.
A patient population that gets very little relief and this is really a patient population that is in the sweet spot for Otezla.
The other thing I have to say is that our our new colleagues when building out their positioning strategy for otezla and their payer strategy have done a very very nice job both positioning the access and reimbursement for Otezla as a post topical pre biologic option. So I think for the.
Mild to moderate population if were successful in securing that indication that same payer strategy will be continued so I feel confident that we're in good shape there for.
Another source of growth for Otezla going forward.
So the and I know we've got several calls are sort of sort of question still cued up so we'll try to get through those policies that were.
On the top of the hour here, but let's go into the next question.
Certainly our nurse or next question from line of Matthew Harrison from Morgan Stanley Matthew.
Hi, good afternoon, thanks for taking the question.
I just wanted to follow up on a comment that Dave made earlier in the call.
Suggesting I think that maybe you're seeing some activity and daily bites in both.
Solid tumors and liquid tumors, maybe you could just characterize for us what what did you have internally that gave you the confidence to make that statement. Thanks.
Yes, Thanks, Matt.
And I assume that someone would pick up on that statement. So what I would say is not ready to declare victory and then any indication yet.
But we're seeing the sort of point pharmacodynamic activity and early suggestions of anti tumor activity.
It or reminiscent of the early days of wind Cyto.
And that give us encouragement that were on the right track I'd also point out that.
We undoubtedly have the largest experience in the world.
In development of by specific T cell Engagers, our as I noted in my remarks, we've learned an enormous amount about dosing and scheduling appropriate management of adverse events and I think all of that is starting to come to bear right now and we're starting to.
I see some of these hints in that and the HL Lee or half life extended off format. So again I'm not ready to declare victory.
We are seeing signs of encouragement and we'll be ready to share some of those data as the year goes on.
And our next question this line of Doe Kim from BMO capital markets, though.
Great. Thanks for taking my question.
Just one on EMEA Vig, you've talked previously about expanding the primary care prescribing base. How would you go about doing that and could you do it with your current salesforce.
Yes, thanks, though we we are doing it weather.
Our current Salesforce I think I talked about the 33000.
Prescribing base.
I think where we're seeing some encouraging results right now in the C. GRP class you see about 7000, new patients coming into the class.
And into the category that are receiving AC GRP therapy, and it's our goal to broaden that given that there are so many patients who are persisting on oral therapies and older therapies that are just not as effective and in fact, we see very high drop off and very low persistency on these older oral.
Old NEDS like to Paramount and where we're trying to change that care continuum that pathway in the wave physicians treat chronic migraine sufferers and I think we're having subsys. Some success. So the the 7000 patient per week number that we're seeing is one that we're looking to.
Grow.
We are applying all the right.
What's both in our digital campaigns as well as our.
Personal selling teams in the primary care community right now so yes that the answer is we have all the resources required to do that.
And our next question is one of yarn Warburg from Cowen and company Darren.
Yes, great. Thanks, so much.
But just a quick housekeeping and then.
Question for Murdo, the housekeeping site Omecamtiv can you just let US know is there one more final vs of be look before you look at the event rate and then for Murdo, just curious about ripoff side. It looks like it's beginning to grow now, but now what's your expectation given that 70% of patients that we have access to the.
The new will price other new formulation. Thank you.
Yes, your own so I'll take the Omecamtiv question.
There isn't as Weve previously and now discuss Theres, an interim analysis for efficacy.
That will occur that has a very very high bar, a very high bar in terms of the statistical AOS stopping rule.
So our expectation is that the trial will continue through to the primary analysis towards the end of the year.
Yes in your own on Repatha.
Just a reminder, 100% of patients are accessing the low list price because we pulled the original list price off the market in December and we've been able to throughout the course of 2019 open up the commercial access where the majority of patients receive repatha by there.
Additions prescribing it without the need for paperwork and utilization management criteria. So this year attestation only in commercial is the majority condition for how they can prescribers half and then in the Medicare part D space.
Obviously, that's a new event for us because we were.
Mid cycle, when we lowered the price with the introduction of the lowest price.
So it's really something we're excited about as an accelerating potential for repatha.
As was mentioned roughly 70% Medicare part D lives now I would have access to repatha and affordable copay. So we're looking forward to seeing sustained growth going forward. Our teams are ready and I was just with our sales forces in Dallas and everybody's pretty excited about being able to treat.
More patients quite frankly, the way they should have been treated all along.
And our next question is line of Geoffrey Porges, Some SVB Leerink Jordan with Jefferies.
You are very much for taking the question quick housekeeping and then once you model.
First could you just give us an update Dave on where the C.
Similar program is is that still active.
For model.
But I.
I am impressed with the event at a number.
Annualized and sort of 350 million already which I think it's better than most of us anticipated.
Could you talk a little bit bout the reception to receiving and whether you really think this can become four times, obviously move you for exclusive any kind of become a forteo like brand.
Given the what you're seeing or revenue. Thanks.
Yes, Jeff So I'll take the first part of that question relating to.
959, or so we're as bio similar though phase three is actively enrolling.
And we'll provide guidance as we come to the conclusion of that trial. When you can expect to see data.
Yes.
Jeff. Thanks for the question on of entity. We are pleased with the launch trajectory on of entity is reflective really of two markets, Japan and you asked primarily the Japanese launch has been nothing short of the resenting success there with.
Our partners established and you see B. I think physician reception has been excellent we we've positioned the product for post fracture.
Hi, risk patients and I think that Thats gone really well and it's where the risk benefit equation seems to be one that most physicians are accepting off and we've done the same thing in the U.S. our launches a little younger in the U.S., but nonetheless, the trajectory has exceeded our own expectations as well, we just recently got our apartment.
In J code in the U.S. and Thats opening up the prescriber base as well. So I do think that we will have a very successful franchise on our hands and of course, you CB will be commercializing with some help from us across Europe .
Thanks to the approval with the May there. So overall weather what will it be as big as a forteo that remains to be seen.
We are I will remind you slightly less expensive.
30% on the low end as much as 70% on the high end then.
Our competitors in the category.
It's a 12 month duration so.
It's not a product that you take for multiple years, it's a 12 month duration, but the new patient acquisition is clearly exciting.
Yes.
And our next question is one of a leap year young from Cantor Fitzgerald with you.
Hey, guys. Thanks for taking my question I guess.
Part of it is another drop thats been doing quite well in spite of Sensipar. So maybe can you talk about should we expect continued kind of demand growth I know you probably had some contracting obviously over the prior 12 months, but just maybe help us frame how to think about next 12 months for parts of that.
Thanks.
Yes, Thanks Lithia the parts of this performance last year was fantastic. There are a number of patients who are benefiting from it. There. There is a change in reimbursement for parcel of going into coming into 2020 that may slow the rate of growth a little bit the range of possible outcomes is broaden its really too early.
To call.
Okay, and I think we've got to more calls where we try to get them and then we'll wrap up.
Very well.
Our next question line of Sunland, So you need from Mizuho Securities Dylan.
Hi, Thanks, guys for taking the question I'm just one from me on Omecamtiv.
David you mentioned that the landscape will be changing.
From the recent data and I guess than what I was looking for some clarity on.
When I presume you were talking about the us GLP two space, specifically adaptable closing.
And then from the commentary Pride are you envisioning this to be.
And when we came to be on top of SDLP twos or competing head to head and if theres any.
Specialty few patients actually getting enrolled in the trial. Thank you.
Thanks, Yes, so so I was making reference to the STL too.
As guilty twos in particular.
Our sense is that patients treated in those studies were probably a somewhat less sick.
Population, so that may or may be a point of differentiation.
And then as we have intended all along with a omecamtiv given the lack of drug drug interactions that we've seen now in the mechanism of action. It is intended to be an add on to other therapies of course in the phase III trial, we will look at that number of patients who are receiving things such as STL too.
SDLP twos.
In the study.
Okay. That's good last question and our final question its line of Cory Kasimov from JP Morgan Cory.
Hi, this is going on for Corey, thanks, setting up and.
And I apologize if you answered this but we were wondering what your assumptions are going into the double digit growth for a Tesla does this imply label expansion or is this just with the existing label.
And our any comments on competitive.
Out of the content.
I think weve address everywhere, we just reiterate for you given what we think bye now.
Yes. So we are assuming that we would secure additional indications in our assumption for double digit going forward. We're also using historical growth rate and where we're sourcing pick new patients right now.
So I think thats pretty clear.
Okay, everyone. Thanks for your patient sorry, we want to little bit pass the allotted hour, but let me just conclude by saying that we feel good about where we ended in 2019.
Managing through what was always going to be a transition year for us and we think we're on the customer now have a period of new product revenue growth. So we look forward to that and we look forward as well to the important clinical data.
As expected, particularly towards the second half of this year so.
I'd be remiss, if I didn't just take a moment to thanks as well the engine staff around the world who continue to work so hard everyday to deliver on our mission to serve patients. So thank you to them and we look forward to every chance to talk all of you and April after the first quarter.
Thanks, Bob Thanks, everybody for your participation. If you have any other questions you would like to cover of course.
Itself and the rest of the IR team will be around for several offers.
Good day.
Ladies and gentlemen, this does conclude amgen's fourth quarter 2019 financial results Conference call. We thank you for your joining US you may now disconnect.
[music].