Q1 2020 Earnings Call

[music].

At this time I would like to turn the call over to Mr. Cook Triano Senior Vice President of Investor Relations. Please go ahead Sir.

Thank you operator.

Good morning, everyone and thanks for joining us today to review Pfizer's first quarter 2020 financial results.

Reaffirmed full year 2020 financial guidance Pfizer's role in helping find solutions for the covert 19 pandemic as well as other relevant business topics.

As usual I'm joined today by our chairman and CEO Albert Bourla, Frank Demilio, our CFO.

Michael Dosed in President of worldwide research and development.

Andrew Wong Group, President Pfizer Biopharmaceuticals group, John Young, our Chief business Officer, and Doglegs, where our general counsel.

Slides it will be presented on this call were posted to our website earlier this morning.

Although at Pfizer Dot com forward slash investors.

You will see here on this slide.

That covers our legal disclosures.

Albert and Frank will now make prepared remarks, and then we'll move to a question and answer session.

With that I'll now turn the call over to Albert Bourla Albert.

Hi, good Sark and paired with I think everyone.

During my remarks argued discounts in the first sportswear business performance as well as recent milestones from our pipeline.

However, I want to started with a few folks about the corporate 19 pandemic and Pfizer's your all in helping fine solution.

Yeah, you got saying that this is an extraordinarily difficult and unprecedented aren't for everything.

The public health challenges posed by called with my team have been pocketed <unk> every allscripts, if our lives as long as the world's largest apart from actually become current partners all the way during this crisis is doing.

On the one can we are focused and maintaining the continued supply of her medicines and vaccines to patients around the globe, while protecting the safety and we're being explored starting something.

On the other you're working with experts both within and outside Pfizer to bring our expertise topical and the resources the crowd contribute the parents. So many contributions to this on them.

Let me share a few examples you're lucky agreeing on this fall.

Yeah, the better get on the best regards happening around the globe and expected to increase the continued supply in far medicines and vaccines is no more greet the government.

I'm pleased we say that the farmers are global supply team has done an outstanding job, keeping our manufacturing sites and related distribution channels directional without significant supply disruptions.

In terms of finding medical supervision trigger point that we.

We are collaborating with interested partners and academic institutions developing that's your mobile approaches to prevent and three that it might be.

Thank you leave no stone unturned and you sort of major blocks is on multiple fronts.

Regarding prevention, we recently announced its farther into Germany quite a bit company bargains.

Enter into a global collaboration agreement to go developed the potential first in class.

And then they based going into buyers purchasing program aimed at preventing called it might be infection.

Last week, we received regulatory up in the basin, German affordable and everything Institute to.

A couple months the fair skinned got dried up 419 vaccine candidates in Germany.

And the first patient that's already been don't.

We also plan to conduct Robinson, the gradual form the regulatory approval, which is expected to shore.

Biotech and Pfizer, we mentioned, we're going to be bringing the marching to markets worldwide.

Excluding China, which has already covered through a separate biotechs collaboration subject of course, we successfully development and regulatory approvals.

We plan to manufacture mediocre and goals, which are the propensity to succeed threes.

By the end of credit Suisse.

Looks very different or do you believe in the development program, we successfully and we obtained regulatory approval.

And then wrapping scare you are good partially due to produce the terms Jeremy hundreds of media doses in 20 to 21.

He wants to try and every once in both companies working <unk> broad.

Regarding a potential in three to them.

We now know while we didn't want to your he's a very pleased to meet you'd be doing well mismatched clubs.

Two pretty see like took days.

Thanks for your R&D viral looks even to get started school.

We are accelerating towards the clinic and maxing regulatory discussions why Gulfstream, they're taking additional I'm department persisting and working on the formulation for are you are going to stretch.

We invested in clinical material over a month ago [laughter] understanding on the bottom excuse me.

Work similar or different PENSCO Gingrich lobbyist ever gets published.

Well September of this year.

We also continued to provide that clinical and regulatory experience you small biotech companies working a promising called it might be Sarah.

And we have several phygen medicines or they are the subject of nobody <unk> brother 40 investigation in patients with Clobbered magazine.

I want to publicly saying, hey, our R&D callers I want to target.

And open late into the night, you find potentially vaccines in Threeq.

I would bring a name to the spending.

And then I'm confident that sorry wing buckle against called it 90.

Now, let me turn to our results for gets are still.

Obviously, we experienced both headwinds and tailwinds related called 19 during this work.

On the one friend or Centerbridge drinkers in many regions, we're not able to detailing physicians and their offers no addition, basically just to get their offices declined significantly beginning at <unk>.

Which is expected to Mega degree Mark you diagnosis of conditions, requiring physician administered diagnostic there.

Beginning in the second quarter for anything.

On the other thing we saw an uptick you know actually paid business is going in the first one girl twentytwenty due in large part.

Hi, good thing user demand for some of 'em be Oh, I'm being effective meds.

As well as other sterile injectable products utilized in the incubation and ongoing threedemin mechanical you've been delayed the Corbett 19 pace.

In total we estimate that these beach and pegs, resulting in the net benefit this 41%.

Our first quarter tend to trend biopharm revenues, primarily reflecting increased demand for certain products in pfizer's must be back before.

And then increasing the page 13 vendor lemons four elements.

In the face of these factors.

We believe bird.

Straight quarterly performance overall.

I like it by 12% of personal revenue growth.

Pfizer barring further shouldn't go group, which will be the businesses like remains rolling to dissipate closing of the zinc production in the second half will join the trend.

We also sold total company revenue Mega going to embark basically expected deeper.

Did you learn 19 loss of exclusivity that you asked for do recur.

Hi, Thank you first completion, the consumer healthcare joint venture transaction would GSK, which removed all recording revenue and expenses from this business.

And declines for me because I live that insight you can the volume based recruitment program, which would you still need but amended in maps. Besides an idea and expand the nationwide in December 2000, I do.

The lyrics consumer impact we both begin to on your lies the sorry, yes.

The bargain sort of must music I'd be themselves spending growth was again driven primarily by strong performances from our key growth drivers.

These include Eliquis <unk>.

Means that goes into the beat the marks ibrance utilize <unk> expense.

As well is 15% of personal growth in emerging markets.

Our oncology business unit four degrees true up 25% personally compared with a year ago worker.

Global gross revenues increased 11% of personally to $1.2 billion during this year.

The U.S. diagrams revenue is going to 50% and retain its strong leadership position in the soubriquet glass due to increased volumes and continued syndicate cross market share gains.

International market deliver strength grew 5% volume growth.

Sure well led by emerging markets.

These Morton Grove was offset by pricing pressures you five mark.

As a result operational revenue growth outside the U.S. was 5%.

For extending.

I lines wherever you see the U.S. were up 25% form the core and when combined with how we're going to income extra sales totaled $256 million.

Extended he's the markets either 78% markets total prescriptions in advanced prostate cancer.

Do you month reached an all time high during the calendar you decided girls in castrate resistant prostate cancer expense, we need to metastatic castration resistant prostate cancer and overall nobody hormone therapy plus girls.

We are pleased with the Arlene the launch of fixed on before metastatic castration insensitive, especially cancer in the U.S.

Extended he's the first and only oral treatment approved by the FDA three distinct types of prostate cancer.

And the related to our acquisition.

Hey, bio pharma, we are pleased by the FDA approval of the lead our rate that's it.

But I still think you combination with it so thanks for.

For the treatment adult patients with metastatic colorectal cancer with a brock.

Mutation after prior therapy.

We believe that rough Dolby doublet has the potential to make a meaningful impact on the likes of goes to living with these music.

Beyond page, we've had several others CMM product performance.

Eliquis continued to perform well.

Pfizer serves on the global revenue was up 29% operationally to $1.3 billion.

This growth was driven primarily by continued increased adoption you know involve your outlook simulation is one of his oral anti coagulation market share gains.

Additionally, U.S. gold was favorably impacted by Colby 19 related.

I'd say LER buying problems, partially offset by a lower net right.

Looking at Oh rare diseases business, Vince circling big box.

Continued to show strong U.S. performance.

Well, they're all this breakthrough medicines contributed $127 million in revenue you actually the first quarter.

Oh disease awareness efforts helped drive the estimated diagnosis rates.

Dean person in the first quarter compared with only wanted to person prior to launch.

The ending the quarter more than 17000 patients have been diagnosed.

More than 8500 patients who have received a prescription and more than 5000 patients having received the drop.

In the quarter, we estimate the upwards number patients in the U.S. taking winter coat.

Approximately 1006.

These numbers include patients who are receiving the dark but no of course.

You are facing a system problems.

In Europe, we received approval of Victor growth for the treatment of 82 yard come to my up actually in February.

And do we have already launched in two markets, including Germany.

That said as a result of stay at home or Gors Youre seeing a slow down the new diagnosis the neighbor.

As fewer patients are visiting doctors' offices for consultations or simply griffey tests.

Global sales revenues were up 8% of personally the character to $451 million.

Revenues outside the U.S. were up 78% of person I guess.

Primarily reflecting continued uptake in rheumatoid arthritis.

Well that's from the recent launch.

Circuit collide the syndication in startup in developed markets.

In the U.S. Xeljanz revenues were down 4%.

These are reflecting continued strong demand across all approved indication.

More than offset by a lower mid rise due to higher rebating from commercial contracts signed in 2019.

It was more or less temporary lowering wholesaler inventory levels in first quarter 20 twin.

Wholesaler inventory levels for cellphones work restore normal levels in early April 22, and.

During Pfizer second quarter.

Underlying volume demand has remained consistently strong.

[noise] globally permanent ticketing revenues were down 1% <unk>, one point $45 billion.

11% of let us know golfing thrown us yoga, primarily reflecting.

Continued pediatric uptake in China, and the overall favorable impact of timing associated with government purchases for the pediatric indication in certain emerging markets.

Including Russia and Turkey.

In the U.S. revenues were down 10%.

Primarily reflecting the unfavorable impact of timing associated with government purchases for the pediatric indication compared with the previous year warfare.

Looking at our sterile injectables conform.

Our manufacturing covering saving a positive impact on the topline in the U.S.

We have completed most of our supplier to mediation and continue to invest in modernization necessary to sustain performs.

In response to increasing demand.

Use of the called 19th I'm Debbie.

In March Pfizer see more than 70, <unk> hundred 60% of baseline demand from this portfolio and Morgan penalties exceeded 200.

In certain cases parties are supported up to six hundreds of baseline the month.

Oh, no our global revenue for almost sterile Injectables <unk> beauty, 50% of internationally in the first quarter and increased 6% sequentially compare fourth quarter of 2019.

Additionally, more than 90% of our injectables portfolio ease in stock today.

Our global by seamless from sort of your group, 63% of personally to 288 and give them doors in the quarter.

The increase was driven largely by steady growth in the U.S.. Thanks to a strong performance both recruits and continued progress with Inflectra, which was up 46% UTI increased demand in open systems, partially offset by price erosion.

We also have launched putting therapeutic monoclonal antibody oncology bar stimulus in the U.S. over the past few months and threw out on current biopsy Michel engagements with payers and providers, where you have not seen the negative impact of exclusionary constructing by the innovator companies that you had seen.

Inflectra Hello.

As expected <unk> revenue for our <unk> business were down 37% of direction I mean the calendar.

<unk> billion dollars.

The decline was primarily driven by be expected significant volume declines for lyric out in the U.S. you do multi started generic competition that began in July 2019.

I'm some revenues in China declined 41% of pressure.

Primarily driven by I'm, just basically glassware Liberals are enormous.

Primarily resulting from the valued.

Based procurement program, which was you missed young implemented the March 2019, and expanded nationwide beginning in December of 2019.

These declines were consistent with our previous guidance, where the <unk>.

Regarding I'm, just gonna be nation with Mylan.

The industrial logic continues to be very attractive.

Why lupus all the expected timing when the deal close to the second half of the trendy.

Most of your due to administrative delays related to cope with 19.

There's no change in our commitment to the transaction and we continued to move forward with all pre closing activities and emissions.

Last week, the European Commission approved the proposed transaction subjected divestment of some of my last genetic Mems.

There are no R&D, we continued to be excited with the progress we are making with our pipeline and they're potentially present, the reverse significant benefits to patients across a range of therapeutic areas.

Since our last earnings call on January 28.

We have seen some exciting milestones.

We announced topline results from a phase three study pfizer's trend developing pneumococcal conjugate vaccine you know dogs 18 years interface or older.

The vaccine candidate demonstrated safety and Immunogenicity profile comparable licensed pneumococcal vaccines, and we expect to fight the adult Wendy.

Well and you won't grow indication would be M.D.A., you early fourth quarter.

Trend between.

We are now we are in caught up to both our potential Mcdonald RSV vaccine, which created a recent face to read dogs with preliminary positive data with favorable tolerability and safe.

Assays to restart is projected within a few months and we look forward. He discussing these data with regulators.

We announced positive top line results from a third phase three trials are proceeding at.

The study, which evaluated the safety and efficacy or I've received and it doesn't was moderate to severe atopic dermatitis.

We're also background topical therapy.

And included an active control arm treated with you Peel them up plus broke ground topical therapy.

Met both of which school primary efficacy endpoints.

In the key secondary endpoint the proportion of patients in the upper Symphony 200 milligram, our looks like but let's see because it becomes significantly.

Reduction clinically significant reduction in each by two was statistically superior who did you pewter <unk>.

Why are the hundred milligram and proceeds from our was numerically higher but no studies to go to significantly higher.

Then the do people are doing.

These data along with the results from other positive monotherapy people don't trials, we support regulatory filings starting with the FDA.

<unk> for later this year.

All filing for optimism was accepted for review in March that both the FDA and EMA.

We are pursuing approval for the tend to have milligram dose administered subcutaneously in patients with chronic pain due to moderate to severe osteoarthritis, who have failed prior <unk>.

In the U.S., we expect an advisory Committee meeting later this year and indices on from the FDA in December.

Decision from the <unk> regulators is expected next year.

All they see the guts to see bigger it'd be nice.

Hey, let's see positive results in the phase two proof of concept study before not.

There are different but I'd be would be sure at an upcoming Congress.

The license and <unk> a NZ he feels three and descends only go go type project successfully concluded the face swung to a part of the program.

I think its primary endpoint and multiple secondary endpoints.

The program 'cause advanced awards traced to be.

The focus into indications severe hyper through December and cardiovascular risk reduction.

Preliminary results in our phase one be usain muscular dystrophy didn't scar study.

To support the continuation of its Ireland to start off a phase three program.

We'd see some dissipated to begin dosing patients in the second half of trendy planned.

Subject to regulatory approvals of course.

The first one B trial continues despite the card and Cobiz 19 pandemic because of the urgent need obese patients and their families.

We will be starting more results from these trial on May 15 at the American Society for gene and cell therapy Conference.

Despite a brief paulson clinical trial recruitment.

Most of our keep pipeline programs continued to move forward.

We anticipate the timing for topline data from the phase three Ibrance pilot study remains fairly 20 to 21 for example.

Because the study was already fully enrolled before the polls.

To end the balance you will go adult star. This all schools have completed and drugs just waiting on the results.

We look forward to two rescheduling Oh Investor day.

Previously scheduled for my answer would be first once we have a clearer picture over the evolving guidelines regarding Colby 90.

So no before I turn it over to front I would like to give you a broad view of our reaffirm twentytwenty find them some guidance for talk on fives.

Pfizer and UBS on combined which I see as a strong maisons regarding the strength and resilience of our business.

I will speak to total Pfizer and Frank will provide more specifics in his comments.

Since our initial trendy trendy guidance was provided in January.

I've seen three incremental factors, but do we have incorporated into our guidance.

R&D investments, we have made and plan to me during twentytwenty to come but Colby the 19.

Operator: BF-WATCH TV 2021 Good day, everyone, and welcome to Pfizer's first quarter 2020 earnings conference call. Today's call is being recorded. At this time, I would like to turn the call over to Mr. Chuck Triano, Senior Vice President of Investor Relations. Please go ahead, sir.

The projected commitment to embark and other operational.

All right them on all operations in terms of the Pete you know.

And changes in foreign exchange rates.

In terms of the first park.

As you have seen us unknown already we see promising signs based opportunity in terms of combined to cope with 19.

Support on this highly important initiative.

We are increasing our projected R&D investment for 20 to 20 by $500 million.

Unknown Executive: Thank you, Operator. Good morning, everyone. And thanks for joining us today to review Pfizer's first quarter 2020 financial results, our reaffirmed full year 2020 financial guidance, Pfizer's role in helping find solutions for the COVID-19 pandemic, as well as other relevant business topics. As usual, I'm joined today by our Chairman and CEO, Albert Bourla, Frank D'Amelio, our CFO, Michael Dolsten, President of Worldwide Research and Development, Angel The slides that will be presented on this call were posted to our website earlier this morning and are available at Pfizer.com forward slash investors. You'll see this slide that covers our legal disclosures.

Unknown Executive: Albert and Frank will now make prepared remarks, and then we'll move to a question and answer session. With that, I'll now turn the call over to Albert Borlaug. Albert? Thank you.

These predominantly reflects the investment in our goal with 19 vaccine development collaboration with bio Tech, which is rapidly moving forward.

Regarding the second factor.

We have analyzed the changing dynamics within our markets and believe that we are likely to see more negative impact.

During the second quarter, driven primarily by reductions you patient starts you to reduce office visits and diagnostic testing.

And lower levels.

Yes.

But we are modeling and overall economic recovery beginning in the second half over this year with an expectation that health care activity will approach frequently 1911 slate going into year.

Obviously, there are still uncertainties, but we believe we do have ever Zoomlion business model and the care line of sight for our business as compare we don't see many other sectors of the economy.

Our portfolio comprises medicines, what do you see potentially different types of impact from the corporate 19 pending.

Albert Bourla: Thank you, Chuck, and good morning, everyone. During my remarks, I will discuss the first quarter's business performance, as well as recent milestones from our pipeline. However, I want to start with a few thoughts about the COVID-19 pandemic and Pfizer's role in helping find solutions. It goes without saying that this is an extraordinary, difficult, and unprecedented time for everyone.

Some are medically necessary sponsors eliquis and ibrance.

Also more reliant on continuing paces. Some are generally more rely on our new patient starts so it's been bucket or something.

Or used in second sensory sedges.

And Steve other medicines that had been identified this medically necessary independently such as some of our hospitals thriving executive appointments.

Albert Bourla: The public health challenges posed by COVID-19 have impacted almost every aspect of our lives. As one of the world's largest biopharmaceutical companies, our role in this crisis is dual. On the one hand, we are focused on maintaining the continued supply of our medicines and vaccines to patients around the globe while protecting the safety and well-being of all our colleagues. On the other hand, we are working with experts, both within and outside Pfizer, to bring our expertise, capital, and resources to help contribute potential medical solutions to this pandemic. Let me share a few examples of what we are doing on this front. With the burden on hospitals happening around the world and expected to increase, the continued supply of our medicines and vaccines is now more critical than ever.

Albert Bourla: I am pleased to say that the Pfizer global supply team has done an outstanding job keeping our manufacturing sites and related distribution channels operational without significant supply disruption. In terms of finding medical solutions for the pandemic, we are collaborating with industry partners and academic institutions to develop potential novel approaches to prevent and treat COVID-19. We aim to leave no stone unturned, and we have made advances on multiple fronts.

<unk> increased utilization will be closer to called with 19 Grace.

If you remember about large proportion of our portfolio he's made up of oral or cells music meds.

But do not require a visit to infusion center a doctor's office.

You know this and majority of revenue for our portfolio is derived from specialty pharmacy channels, which enables directive anybody who is medicines to patients.

Both positive architecture and the economy Bob.

Given that we anticipate that them blended.

Hi, good 19.

Let me offer a few specifics regarding how we are projecting the call. Good 19th they make theme park are larger revenue growth drivers.

Medicine satisfied brands and Eliquis, both unexpected to continue generate new patient starts but they are also more mature and therefore more dependent on maintenance therapy with continuing with continuing pace.

Both our oral medicines.

Reducing their categories and very well known to physicians.

After a good such as Eliquis no safety profile.

Which does not require a regular monitoring.

Albert Bourla: Regarding prevention, Pfizer and the German biotech company BioNTech recently announced that they have entered into a global collaboration agreement to co-develop the potential first-in-class, mRNA-based coronavirus vaccine program aimed at preventing COVID-19 infection. Last week, we received regulatory approval from the German authority, the Paul Ehrlich Institute, to commence the first clinical trial for our COVID-19 vaccine candidates in Germany, and the first We also plan to conduct trials in the US upon regulatory approval, which is expected shortly. BioNTech and Pfizer will also work jointly to bring the vaccine to market worldwide, excluding China, which is already covered through a separate BioNTech collaboration, subject, of course, to successful development and regulatory approval. We plan to manufacture millions of doses of the potential vaccine at risk by the end of 2020.

Hey provides an opportunity for appropriate patients with an alternative treatment option. During this time.

Albert Bourla: To accelerate availability, in the event the development program is successful and we obtain regulatory approval, and then to rapidly scale up capacity to produce potentially hundreds of millions of doses in 2021. Regarding a potential treatment, we now know our lead molecule is a very potent inhibitor of the SARS-CoV-2, 3C-like proteins, with confirmed antiviral activity against SARS-CoV-2.

As for Ibrance, why we would expect you seen some minimal impact the new patient starts for Ibrance in second quarter.

We also expect you see a catch up in the second.

Over the year.

I think our core he's a good example affair recently launched products.

No problem is highly dependent on new patient starts, but the diagnosis process also requires doctors office visit.

Subsequent diagnostic testing through additional office visits.

We anticipate that don't you new patient starts and I've seen it accordingly.

We are seeing but card, but we believe the strong momentum behind this book that we resumed in the second call well the gearing comes from diagnosis prescribing and patient access.

Regarding pregnant.

While we anticipate the temporary slow down in vaccinations in the second quarter.

We believe the resurgence in infant mixing nations cuts off.

Let's take place in the second half over you.

And for adults, we anticipate that we'd be heightened awareness of importance and getting vaccinated.

The next flu season.

As it was dozens in a category, where many other products out of infusions.

That was less than the white and not all options for patients, which should be well suite deep into the current environment.

Because they'll jump because <unk> in the markets for more than eight years loves proportion will be driven this is driven by continued patients.

Albert Bourla: We are accelerating towards the clinic and commencing regulatory discussions while also undertaking additional antiviral testing and working on the formulation for IV administration. We invested in clinical materials over a month ago, ahead of understanding antiviral activity to accelerate the potential clinical studies in early August for September of this year. We also continue to provide our clinical and regulatory experience to small biotech companies working on promising COVID-19 therapies, and we have several Pfizer medicines that are the subject of novel research projects for investigation in patients with COVID-19. I want to publicly thank all our R&D colleagues who are working tirelessly, often late into the night, to find potential vaccines and treatments that could bring an end to this pandemic. In the end, I'm confident that science will win the battle against COVID-19. Now, let me turn to our results for the first.

He also has broad pay or exits and patient co pay support.

We expect to see temporarily impacted new patient starts for zones in the second quarter, but again, we expect to see recovery in the second half of it you.

Well, we are seeing more pronounced negative impact he's with medicines that might not see oh.

Topics for example.

Which is generally prescribed during it will visit with a physician.

And be MP, which as you you elected seven years would be two products I would highlight here in this category.

So when looking across the portfolio, we don't see these as revenue, but we'd be lost forever, but mainly as deferred revenue to be slowly recoup the pandemic easy and we see a normalization of interactions between our sales force and physicians and between physicians and patients.

As a result, we believe that the anticipated net impact of these factors in combination with someone called it the related operational improvements should.

Albert Bourla: Obviously, we experienced both headwinds and tailwinds related to COVID-19 during this quarter. On the one hand, our sales representatives in many regions were not able to discuss details with physicians in their offices. In addition, patient visits to the doctor declined significantly beginning at the end of March, which is expected to negatively impact new diagnosis of conditions requiring physician-administered diagnostic tests beginning in the second quarter of 2020. On the other hand, we saw an uptick in our hospital business unit in the first quarter of 2020 due, in large part, to stronger than usual demand for some of our anti-infective products, as well as other sterile injectable products In total, we estimate that these puts and takes resulted in a net benefit of only 1% of our first quarter 2020 biopharma revenue, primarily reflecting increased demand for certain products in Pfizer's hospital portfolio and an increase in wholesale inventory levels for Eliquis in the face of this factor.

Should be negligible intensified telephone company raising rates projections for two and the plan.

We have also reduced our I say guidance one of the good news.

This reflects reduced depending on both direct and indirect same day during the Questcor.

As well as some additional efficiencies identified for the remaining 20 plan do you know you're right. It's I know your reduction Denise.

Lastly regarding foreign exchange.

So let me some guy that's exactly the U.S. dollar strengthening.

Drives and expected reduction in total revenues of approximately $600 million and negatively impacts adjusted earnings for served by approximately four cents.

Bringing this altogether now.

Our current view of the underlying strength breadth and projecting the resilience of our business in this uncertain times allow us to absorb both incremental $500 million than projected R&D investment this year and the incrementally negative foreign exchange impact to maintain our initial guidance ranges.

On both the top and bottom lines.

In addition, I see the long term fundamentals of our business remaining strong and following the completion from the ABS and transaction I expect our business to be positioned to generate at least 6% component on your revenue growth through kind of 25.

Albert Bourla: We delivered a strong quarterly performance overall, highlighted by 12% operational revenue growth in our Pfizer biopharmaceuticals business, which will be the business that remains following the anticipated closing of the upjump transaction in the second half of 2020. We also saw total company revenue negatively impacted by three expected events, the July 19 loss of exclusivity in the U.S. for Lyrica, the July 31st completion of the Consumer Healthcare Joint Venture transaction with GSK, which removed our recording of revenue and expenses from this business, and declines from Lipitor and Nervas in China due to the volume-based procurement program, which was initially implemented in March 2019 and expanded nationwide in December of 2019. The Lyrica and Consumer Impacts will both begin to annualize in the third quarter. The biopharmaceutical group's outstanding growth was again driven primarily by strong performances from our key growth drivers. These include Eliquis.

Albert Bourla: Vintagel Vintamax, Ibrance, Inlita, and Xtandi, as well as 15% operational growth in emerging markets. Our oncology business was particularly strong, up 25% operationally compared with a year ago. Global Ibrance revenues increased 11% operationally to $1.2 billion during this quarter. In the U.S., Ibrance revenues grew 15%, and it retained its strong leadership position in the CDK class due to increased volumes and continued CDK class market share gains. The international market delivered strong 25% volume growth in the quarter, led by emerging markets. However, this volume growth was offset by pricing pressures in the EU5 market. As a result, operational revenue growth outside the U.S. was 5%. Alliance revenues in the U.S. were up 25% for the quarter, and when combined with our royalty income on ex-U.S. sales, totaled $256 million.

We expect adjusted yes, obviously to grow even faster.

Now I will turn it over to from.

Frank.

Thanks, Albert Good day, everyone before I walk you through our results for the quarter I want to comment on the current global pandemic, which is impacting nearly every industry around the world.

Despite the challenges inherent in operating in this environment the fundamentals of our business continued to be strong our outlook for the future of the company remains bright.

We continue to have a strong balance sheet favorable credit rating, which we expect to allow us to access the capital markets is needed which has demonstrated in late March with the issuance of a 1.25 billion sustainability bought the first of its kind in our industry.

On the supply side.

49 of our manufacturing facilities remain operational.

Albert Bourla: Xtandi is the market leader with 38% market share in total prescriptions for advanced prostate cancer. Demand reached an all-time high during the quarter due to solid growth in castrate-resistant prostate cancer, expansion into metastatic castration-sensitive prostate cancer, and overall, novel hormone therapy class growth. We are pleased with the early impact of the launch of Xtandi for metastatic castration-sensitive prostate cancer in the U.S. Xtandi is the first and only oral treatment approved by the FDA in three distinct types of prostate cancer, and related to our acquisition of array biopharmaceuticals. We are pleased by the FDA's approval of the Lead Array Assay, in combination with cetuximab for the treatment of adult patients with We believe that Braftovia doublet has the potential to make a meaningful impact on the lives of those living with this disease.

Albert Bourla: Beyond Oncology, we had several other strong product performances and continue to perform well. Pfizer's shares of the global revenue were up 29% operationally to $1.3 billion. This growth was driven primarily by continued increased adoption in non-valvular atrial fibrillation, as well as oral anticoagulant market share gain. Additionally, U.S. growth was favorably impacted by COVID-19-related wholesaler buying patterns, partially offset by a lower net, looking at our rare diseases business, and Vintakell and Vintamax. Continue to show strong U.S. performance

Not seen a significant disruption in our supply chain as a result dependent.

To ensure the safety of our manufacturing colleagues, while they perform as critical work.

Put in place enhanced safety measures at all of our plants, including investing in protective equipment staggering shifts so that fewer colleagues are present in once.

Restricting side access to only a central workers and requiring colleagues.

Tax on site.

I want to acknowledge how proud I am.

Colleagues, many of whom on the front lines. In this fight have responded to this crisis courage and passion from those who are working around the clock.

Actual treatments are vaccines for coping 19 to those who continue to operate on manufacturing supply chains.

She is going out the medicines.

As in times like these that the strength of our culture and of our people really shines.

Now onto the financials.

First quarter 2020 revenues were $12 billion down 7% operationally versus the year ago corner of course, most of this decline is due to the fact that we no longer report revenues.

So my health care business.

Quoting this impact revenues were down 1% operationally.

I would already explained in detail our Biopharma revenues grew 12% operationally this quarter driven by strength across multiple products, what approximately one percentage point to that growth attributable to the net impact.

Product sales.

John revenues declined 30%, 1% operationally driven by generic competition for lyric or in the U.S. and declining sales.

Bask in China.

Fermentation nationwide expansion of the volume based procurement program.

Both of these negative drivers were anticipated in our previous upjohn guidance.

Total company adjusted <unk> expenses in the quarter was down 16% operationally.

Approximately half of that decline was due to the fact that we no longer report expenses for the consumer health care business I mean, they never the decrease was driven by reductions in field force advertising and promotional expenses.

Eric on the U.S. and lower selling expenses.

Yes.

Yeah.

Thanks for coming.

Well as lower indirect assign a spending associated with corporate enabling functions.

Both reported and adjusted.

First quarter was down compared to the year ago corner. The decrease was primarily due to lower revenues, mainly driven by the loss of exclusivity.

The U.S., partially offset by lower <unk> expenses finally, foreign exchange had a negative impact of 134 million.

1% <unk> first quarter 2020 revenues two cents negative impact on adjusted.

Compared to the year ago corner.

Before walking you through our guidance updates in detail I want to acknowledge that no. One currently knows exactly.

What time frame the kobin 19th.

Yes, and eventually come to its resolution.

Given those uncertainties.

As transparent as possible.

Providing on this chart the key coven 19 related assumptions that are reflected in today's guidance update.

In summary, our financial guidance reflects our expectation that most healthcare systems around the world will begin to resume.

<unk> functions in the second half of 2020.

Putting in person Doctor visits.

Brand prescription trends salesforce activities clinical trial enrollment.

Albert Bourla: Overall, these breakthrough medicines contributed $127 million in revenue in the U.S. in the first quarter. Our disease awareness efforts helped drive the estimated diagnosis rate to 13% in the first quarter compared with only 1-2% prior to launch. At the end of the quarter, more than 13,000 patients were diagnosed, and more than 8,500 patients received the prescription, and more than 5,000 patients received the drug. For the quarter, we estimate the average number of patients in the U.S. taking Vintercal was approximately 4,600.

The guidance also assumes that we will be able to continue to operate on manufacturing and supply chain without material disruption.

Turning to invest in potential treatments and vaccines against coven 19 throughout 2020.

With that let's take a look at our guidance consistent with last quarter. We are providing three sets of financial guidance. As a reminder, those three sets of guidance are as follows.

The company, which reflects our current cost structure of the Biopharma and I'm trying to businesses and excludes any impact from depending up John combination with Milan.

Two new Pfizer, which is a full year pro forma view that reflects the impact of depending on the interest transaction by removing up John and including 12 blend in cash proceeds from up John to Pfizer.

Albert Bourla: These numbers include patients who are receiving the drug at no cost through our patient assistance program. In Europe, we received approval of Vinterquell for the treatment of ATTR cardiomyopathy in February, and we have already launched it in two markets, including Germany. That's it as a result of the stay-at-home order. We are seeing a slowdown in new diagnoses in AIDS, as fewer patients are visiting doctors' offices for consultations or sci

The transaction related factors, such as transitional service agreement revenue and three up John as a standalone business I remind you.

At the up John guidance includes the Meridian business, and our collaboration with Mylan and Japan.

Discussed last quarter.

All of these scenarios continue to be based on a full year revenues and expenses in 2020.

Beginning with total company as Albert mentioned, we are reaffirming our guidance ranges for both revenue and adjusted yes, despite absorbing incremental negative impacts due to foreign exchange fluctuations since mid January of approximately 600 million on revenue and four cents on adjusted.

Albert Bourla: Global Xeljanz revenue was up 8% operationally in the quarter to $451 million. Revenues outside the U.S. were up 38% operationally, primarily reflecting continuous uptake in rheumatoid arthritis, as well as from the recent launch of the ulcerative colitis indication in certain developed markets. In the U.S., Xeljanz's revenues were down 4%.

Yes.

Moving down the income statement, we lowered our cost of sales as a percentage of revenue guidance range.

0.4 percentage points to reflect favorability, resulting from changes in product mix other efficiencies.

Selling information and administrative expenses, we are lowering our guidance range by $500 million. This reflects incremental cost savings opportunities primarily related to indirect assigning spending.

Albert Bourla: This reflected continued strong demand across all approved indications, more than offset by a lower net price due to higher rebates from commercial contracts signed in 2019, as well as a temporary lowering of wholesaler inventory leverage in first quarter 2020. Wholesaler inventory levels for Xeljanz were restored to normal levels in early April 2020, during Pfizer's second quarter, as underlying volume demand has remained consistently strong. Global Prevnar 13 revenues were down 1% to $1.45 billion with 11% operational growth internationally, primarily reflecting continued pediatric uptake in children and the overall favorable impact of timing associated with government purchases for the pediatric indication in certain emerging markets, including Russia and Turkey. In the U.S., revenues were down 10%, primarily reflecting the unfavorable impact of timing associated with government purchases for the pediatric indication compared with the previous year quarter.

As well as actual and anticipated spending reductions as a result.

Yeah.

And as Albert I already spoke about the $500 million upward revision to our R&D expense range. Finally, our guidance continues to anticipate Sheppard no share repurchases in 2020.

Moving on to financial guidance for new Pfizer enough, John despite absorbing negative incremental impacts on revenues due to changes in foreign exchange rate since mid January of approximately $500 million for new Pfizer and 100 million for up John we are reaffirming.

Fiscal year 2020 revenue guidance ranges from both pro forma companies.

Additionally, we are reaffirming the guidance ranges for adjusted IBT margin.

Yes, Pfizer as well as adjusted EBITDA for.

The only change to the guidance, we gave a new Pfizer is a 1 billion dollar reduction and arrange for operating cash flow driven entirely by a 1.25 billion voluntary U.S. pension contribution, which we plan to make in the second half of 2020.

Moving on to key takeaways in the first quarter of 2020, our company performed well in a challenging environment driven by strong revenue growth from our Biopharma business, we reaffirmed our 2020 guidance revenues and adjusted.

Albert Bourla: Looking at our sterile injectables portfolio, are manufacturing coverings having a positive impact on the top line in the U.S.? We have completed most of our supply remediation and continue to invest in modernization necessary to sustain performance in response to increasing demand due to the COVID-19 pandemic. In March, Pfizer shipped more than 30 critical medicines at 150% of baseline demand from this portfolio, and more than 10 of these exceeded 200. In certain cases, Pfizer supported up to 600% of baseline demands.

Yes.

Multiple product and pipeline milestones since our last quarterly update some of which are listed here demonstrating the continued advancement of our late stage pipeline finally.

2.1 billion in dividends to our shareholders. This quarter as always we remain committed to delivering attractive shareholder returns in 2020 and beyond.

I'll turn it back to John.

Thanks, Frank and thanks, Albert for those comments operator can we please know poll for questions.

Ladies and gentlemen, if you will like to ask a question. Please press Star then the number one on your telephone keypad, we'll pause for just a moment to compile the Q1 day roster.

Albert Bourla: Of note, our global revenue from the sterile injectable portfolio grew 15% operationally in the first quarter and increased 6% sequentially compared to the fourth quarter of 2019. Additionally, more than 90% of our injectable portfolio is in stock today. Our global biosimilars portfolio grew 63% operationally to $288 million in the quarter. The increase was driven largely by steady growth in the U.S., thanks to a strong performance of Retacrit and continued progress with Inflectra, which was up 46% due to increased demand in open systems. Vasilyev said under pressure.

Your first question comes from the line of David Risinger.

In Stanley.

Yes, thanks, very much a for the detailed review and congratulations on the performance.

So I have two questions. Please first is with respect to the guidance and the second is on the vaccine candidate.

So with respect to the guidance and the assumptions on slide 13.

Could you just discuss what you're assuming with respect to a potential resurgence in co bid during the start of the flu season in the fourth quarter and the impact of that on health care systems and physician visits and then second with respect to your but vaccine candidate.

Albert Bourla: We also have launched three therapeutic monoclonal antibody oncology biosimilars in the U.S. over the past few months. And we are encouraged by our initial engagements with payers and providers, where we have not seen the negative impact of exclusionary contracts by the innovator companies that we had seen with the Inflectra launch. As expected, revenues for our up-zone business were down 37% operationally in the quarter to $2 billion. The decline was primarily driven by expected significant volume declines for Lyrica in the U.S. due to multi-sort generic competition that began in July 2019. Amazon revenues in China declined 41% over last year, primarily driven by undisturbed declines for Lipitor and Norva, primarily resulting from the value-based procurement program which was initially implemented in March 2019 and expanded nationwide beginning in December of 2019. These declines were consistent with our previous guidance for the update. Regarding absence combined with mild.

<unk> bio and tech.

Could you just discuss your level of conviction that you have the right candidate that will be safe and effective and when do you expect to generate animal data and when do you expect to generate initial human data. Thank you very much.

[noise], Dave. Thank you very much very good questions, let's use low the first one with guidance, let me ask Frank to make comments about the assumptions.

So David on on our guidance, we are assuming a recovery in the second half of the year, we expect the second quarter to be the quarter, that's primarily impacting the negative way from the coven 19 virus, we do expect the recovery in the second half for the year that includes the items that we talked about.

And our comments and person Doctor visits.

Start up again, new to brand prescription trends salesforce activities clinical trial enrollment and obviously all of our sites continuing to operate and provide medicines to patients.

They're currently doing today, so punch line second half recovery.

Albert Bourla: The industrial logic continues to be very attractive, while we push out the expected timing of the deal close to the second half of 2020, mostly due to administrative delays related to COVID-19. There is no change in our commitment to the transaction, and we continue to move forward with all pre-closing activities and initiatives. Last week, the European Commission approved the proposed transaction, subject to divestment of certain of Milan's generic medicines. Turning now to R&D, we continue to be excited with the progress we are making with our pipeline and the potential it has to deliver significant benefits to patients across a range of therapeutic areas. Since our last earnings call on January 28th, you have seen some exciting mileage. We announced top-line results from a phase 3 study of Pfizer's 20-valent pneumococcal conjugate vaccine in adults 18 years of age or older.

Healthcare system returns to normal operations.

Thank you Frank now, Mike and I think you would like to comment on live action before let me say just one single vaccine looks decent mute technology, but we are very familiar with box that technology in the company because you're working with them. The last two years in the joint project will develop with the same technology flu vaccine. So we jump.

Turning to the called me to 19, when the need to merge jointly together.

And so we are applying to of course, all the learnings well for the Oh for they are things that we've had with the technology. During the last few years now micro can just be really speak more specifics about the the the specific project.

Thank you all that and they Florida Austin is important because.

I would start by saying I think we'd have the most comprehensive.

Saw scooped vaccine program currently ongoing and specifically related to them over night.

That's all that the alluded to we had built a lot of experience on.

Albert Bourla: The vaccine candidate demonstrated a safety and immunogenicity profile comparable to licensed pneumococcal vaccines, and we expect to file the adult to ending, Valen, Pneumococcal, Indication with the FDA in the early fourth quarter of 2020. We are excited about our potential maternal, which had a recent phase 2 redoubt with preliminary positive data with favorable tolerability and safety. Phase 3 start is projected within a few months, and we look forward to discussing this data with regulators.

The various type of M. on <unk> and the formulation of leaping on apart people through two units warrant.

On the flu.

A lot of different animal data.

Coming from all walks and walk from my own thick on both.

Oncology and other programs.

When it comes to that specific yeah.

Lightspeed program as it's cool that has basically in.

Two to three months moved from the pulling table to dosing patients right now.

Things as we have no four different vaccine candidate that will be studied in humans. The first one already knows.

And that the law was more than anyone to share at peak.

From a new disease like 19.

Albert Bourla: The study, which evaluated the safety and efficacy of abracitinib in adults with moderate to severe atopic dermatitis who were also on background topical therapy and included an active control arm treated with dupilumab plus background topical therapy, met both of its co-primary efficacy endpoints. In a key secondary endpoint, the proportion of patients in the abrosive 200 mg R arm, let's see A clinically significant reduction in each by week 2 was statistically superior to the Dupulavim R, while the 100 mg ambrosidinium R was numerically higher but not statistically significantly higher than the Dupiluma are at the week. These data, along with the results from other positive monotherapy pivotal trials, will support regulatory filings starting with the FDA, plan for later this year. Our filing for tanizumab was accepted for review in March at both the FDA and the EMA. We are pursuing approval for the two-and-a-half milligram dose administered subcutaneously in patients with chronic pain due to moderate to severe osteoarthritis who have failed prior analysis.

M. and all in type one and again, it's the most effective and allow us to pick one or two to move into pivotal studies.

So that's covers.

Modify them are nice modified and the self amplifying the best on my knowledge, we had only one currently having sell I'm going to fight ammonia into clean, which would allow you to dose at lower knows than any other pump.

To have animal data from Rodin on the Vivus punk drugs that are encouraging.

And we also have data from patients here that shows that the two and again that we pick seems to be the most relevant for intervening and utilizing <unk> viruses and by having picked too.

By quarter smaller component receptor binding domain again, I think we've been able to.

Sure I repeat what turns out to translate most effectively and man.

So more animal data will come over the next few weeks, one probably Matt and I expect human data to come late May June from the first.

Experiments are performed on plan smartphone vaccinated patient.

Is that.

Yeah on the signed with continues Dataflow that should allow us to progress.

Albert Bourla: In the U.S., we expect an advisory committee meeting later this year and a decision from the FDA in December. A decision from the EU regulators is expected next month. Our ACC DGAT2 inhibitor combination has achieved positive results in a Phase II proof-of-concept study for NUSH. Data from that study will be shared at an upcoming conference. The licensed ANG-PTL3 and Descense oligonucleotide project successfully concluded the Phase 1, 2, and A parts of the program, meeting its primary endpoint and multiple secondary endpoints. The program has advanced towards Phase 2B, with a focus on two indications, severe hypertriglycemia and cardiovascular risk reduction. Preliminary results from our Phase 1b Duchenne muscular dystrophy gene therapy study support the continuation of the trial and the start of a phase three program, which is anticipated to begin dosing patients in the second half of 2020, subject to regulatory approval.

That would regulators. So we expect the flow of data coming May June and then move into expended trials that could allow emergency use or accelerated approval coming into fall, possibly you know October and onwards. So thank you very much for your question.

Thank you Mike I can get so let me add here, but then there is a nice or why we'd something too large he's not only because we've had the familiarity with a company with the technology and took a discuss this project, but when you, but exciting but definitely we said we are uniquely position to count during this crisis, because we couldn't be into and capabilities.

We are having very strong capabilities from early preclinical research all the way to manufactured and frankly as we have I think said, but they make it very clear novels. So we are planning to manufacture threes.

Purchasing so if the technical success and they're going up remotes are there we will have those is available.

In during the last quarter over this year and social or you do it would be in a mystery if I would've been mentioned right no Buck.

Hi, good that's where we are with their device in collaboration with Abbvie is giving us.

Albert Bourla: The Phase 1b trial continues, despite the current COVID-19 pandemic, because of the urgent need of these patients and their families. We will be sharing more results from this trial on May 15 at the American Society for Gene and Cell Therapy Conference, despite a brief pause in clinical trial recruitment. Most of our key pipeline programs continue to move forward. The anticipated timing for top-line data from the phase three Ibrance PALAS study remains early 2021. For example, because the study was already fully enrolled before the... To end development, humano-clinical adult studies have also been completed, and we are just waiting for the results.

They are trying to work with their timelines day and night as well so that they can kind of bring to the wall dissolution. Thank you very monsters go to the next question.

The next question. Thank you.

Your next question comes from the line of Chris Shaw from JP Morgan.

Since here just to first and then to kill and the impact from co bid it sounds like you're expecting a slowdown in diagnosis rates in the quarter should we also expect that or axis and patients receiving drug should also slow or could those actually keep ramping a once you've identified a product that can keep working through the process.

Yes.

My second question and then to kill it was also on payer mix, you've had little bit more experience for the product and we're still trying to get a sense of where gross to net could shake out for the product. So any additional statistics here in terms of how many patients are getting free drug how many are reimbursed. It just any data there would be very helpful.

Albert Bourla: We look forward to rescheduling our Investor Day, originally scheduled for March 31st, once we have a clearer picture of the evolving guidelines regarding COVID-19. So now, before I turn it over to Frank, I would like to give you a broad view of our reaffirmed 2020 financial guidance for total Pfizer, Pfizer and Abgen combined, which I see as a strong message regarding the strength and resilience of our business. I will speak to the entire Pfizer team, and Frank will provide more specifics in his comments.

My final question was on preferences are in infants.

Our your expectations for that product for the year unchanged. So that we're gonna obviously see you get to Q impact, but you get kind of a catch up in the second half a year or should we I should be thinking about prevnar in fit expectations for the year coming down.

That catch up won't offset the lost sales in the quarter. Thanks, so much.

Thank you saw it I think all three questions on a very once with it for Angela wants there so I'm going to I guess I'm just thought it would mean darko.

Albert Bourla: Since our initial 2020 guidance was provided in January, we have seen three incremental factors that we have incorporated into our guidance. R&D investments we have made and plan to make during 2020 to combat COVID-19. The projected COVID-19 impact and other operational impact items on our operations in terms of the peak, and changes in foreign exchange.

Okay. Thank you thanks to those questions, Chris I'm, just I'm going to count and you can see we continue to have just great momentum behind this product and a and we do believe that this will sustain its performance throughout the year.

As I already mentioned, a we do you think that there will be some slowdown in not rexs in the second quarter and I'm actually just to align with those comments, we did see that in our patient hub enrollment.

And that since the middle up much we still a decline of about 20% in the last four weeks compared to the previous fully.

Albert Bourla: As you have seen, as announced already, we see promising science-based opportunities in terms of combating COVID-19 in support of this highly important initiative. We are increasing our projected R&D investment for 2020 by $500 million. This predominantly reflects the investment in our COVID-19 vaccine development collaboration with BioNTech, which is rapidly moving forward. Regarding the second factor, We have analyzed the changing dynamics within our markets and believe that we are likely to see more.

I think that this comment about a new patient starts and it's one that we are seeing in the patient hub. However, that's also think about the great attributes of the count it's an oral medication.

That is being delivered through specialty pharmacy directly to patients home its one that because of its mortality benefit and decreases hospitalizations. All of these really play well to the time that we're in right now in this pandemic and so we anticipate continuing patients to be able.

To continue under drugs and be able to stay on therapy, So no impact on T.

Albert Bourla: during the second quarter, driven primarily by reductions in new patient starts due to reduced office visits and diagnostic testing and lower levels of electroshock, but we are modeling an overall economic recovery beginning in the second half of this year with an expectation that healthcare activity will approach pre-COVID-19 levels later in the year. Obviously, there are still uncertainties, but we believe we do have a resilient business model and a clear line of sight for our business as compared with those in many other sectors of the economy.

Your second question was around the payer mix and on that front, we have not seen I'm change in a intends out the numbers of patients on congressional. This is Medicare. This is other books of business that has been pretty consistent.

Through the time from launch and our Medicare patients are the predominant part of our patient population that hasn't changed at all.

And then I think a third question was on have not P.

And I'm kind of not Pete and similarly, and consistent with comments made earlier, we do anticipate second quarter two have some slowdown and this is just because well visits I'm taking place and there is a lot more caution regarding visits to pediatricians offices.

Albert Bourla: Our portfolio comprises medicines where we see potential different types of impact from the COVID-19 pandemic. Some are medically necessary, such as Eliquis and Iver, but also more reliant on continuum pain. Some are generally more reliant on new patient starts, such as Vindical or Xtandi, or used in certain surgeries, and still other medicines that have been identified as medically necessary in the pandemic, such as some of our hospital sterile injectable products, and are seeing increased utilization because of the COVID-19 crisis. Also remember that a large proportion of our portfolio is made up of oral or self-injected medicines that do not require In addition, a majority of revenue for our portfolio is derived from specialty pharmacy channels, which enables direct delivery of these medicines to patients. Both are positive factors in the current environment.

So we do anticipate some slow down there, but we also know both from our research and from that from our representative that pediatricians are anxious and I'll motivated to get well take it back and to have our lab, our infant as well as I'll I'm actually going back to name.

And therefore based on that based on the fact that we expected recovery in second half.

Thanks comments about assumptions are we do anticipate a catch up towards the second half of the yet that will allow us to widen to attain our expectations that we had four full piece for twentytwenty.

Great. Thank Angela like San Angelo Operator next question. Please.

Your next question comes from.

We're far from Evercore ISI.

Albert Bourla: Given that, we anticipate a combined impact of COVID-19. Let me offer a few specifics regarding how we are projecting the COVID-19 pandemic to impact our larger revenue growth drive. Medicines such as Ibrance and Eliquis are both expected to continue to generate new patient stocks, but they are also more mature and therefore more dependent on maintenance therapy with a continuing pace. Both are oral medicines, leaders in their categories, and very well known to physicians.

Hi, Thanks, so much for taking my question I Hope you all are staying safe Michael on your anti viral for coal that.

You are going down the protease inhibitor track instead of the new maybe if you could explain the thought process and if you could also layout for us the exact he seems to be that you're seeing with your threepl inhibitor and I asked because some of the initial three feel inhibitor constructs you had chosen against Sars, they're easy 15th were above 10, So I wonder if you are seeing some.

I think closer to a one on the protease inhibitor, you've chosen and secondly, uncoated vaccine Michael I'm curious, what's the exact threshold on neutralizing antibody titer that you want to see for you to say you know what we have something.

Albert Bourla: Attributes such as Eliquis' noted safety profile, which does not require a regular monitor, may provide an opportunity for appropriate patients with an alternative treatment option during this time. S4 hybrid, While we would expect to see some minimal impact in new patient starts for Ibrance in the second quarter, we also expect to see a catch-up in the second half of the year. VintaQuer is a good example of a recently launched product that not only is highly dependent on new patient starts, but the diagnosis process also requires a doctor's office visit and subsequent diagnostic testing through additional office visits. We anticipate a drop in new patient starts and are seeing that currently. And we are seeing that currently, but we believe the strong momentum behind this program will resume in the second half of the year in terms of diagnosis, prescribing, and patient. Regarding Prevnar, while we anticipated a temporary slowdown in vaccinations in the second quarter, we believe that there is a resurgence in infant vaccinations to catch up, which could take place in the second half of the year. And for adults, we anticipate there will be heightened awareness of the importance of getting vaccinated prior to the next flu season. As for Xeljanz, in a category where many other products are injections,

Thank you or so Michael.

Stages yours.

Yeah. Thank you very much.

Whom are great questions, so let's start with a.

<unk>.

You know we had the privilege that this isn't just a re pop as protease inhibitor for from.

Then relative.

We had a collection of compound that showed very potent activity into the source code.

And we were able to model and show that it's a very strong similarity in the binding and have confirmed that these compounds on this all spoke to the cobiz 19 disease or very potent.

We are talking about you know very potent knowing them on Laura type a binding and if it's supported by <unk>.

X Ray data available that shows again unique highly selective finding pets.

We are now doing.

Selling or antiviral studies.

Which initial data is encouraging again, showing potent activity, which needs to be studied on different cell types why the virus maybe harbored.

Well together, we think you saw very promising candidates.

And we moving swiftly ahead scaling up adding either I, indeed type of data to potentially pending regulatory dialogues that have initiated they do those patients.

Albert Bourla: Xeljanz provides and nodal options for patients, which should be well-treated in the current environment because Xeljanz has been in the market for more than eight years. A large proportion of its revenues is driven by the continuing pace. It also has broad payer access and pay-as-you-go payment support.

Around August is here.

We're also working on alright full on blogs and have identified several candidates that shows you the ability for these type of.

Delivery system so altogether.

Albert Bourla: We expect to see a temporal impact on new patient starts for Xeljanz in the second quarter, but again, we expect to see recovery in the second half of the year. Where we are seeing a more pronounced negative impact is with medicines that might not seem as obvious. Xandex, for example, which is generally prescribed during a well visit with a physician, and BMP, which is used in elective surgeries, would be two products I would highlight here in this category.

I feel very encouraged that these could be them.

First in clause put this rod for saw spoke to.

And we'll keep you posted as we advance on the vaccine.

Clearly we are looking at you know what could be animal data guiding us on what should be the relevant threshold.

In order to happen utilization a virus then we have in discussion with regulate the gotten good feedback on data from multiple animal models that we all puts you in that could help to possibly even create the surrogate endpoint.

Albert Bourla: So when looking across the portfolio, we don't see this as revenue that will be lost forever but mainly as deferred revenue to be slowly recouped as the pandemic eases. And we see a normalization of interactions between our sales force and physicians and between physicians and patients. As a result, we believe that the anticipated net impact of these factors, in combination with some non-COVID-related operational improvement, should be negligible in terms of our total company revenue projections for 2020. We have also reduced our SINA guidance for the U.S., which reflects reduced spending on both direct and indirect SINA during the first quarter, as well as some additional efficiencies identified for the remainder of 2020 in our indirect SINA reduction initiative. Lastly, regarding foreign currencies, since our initial guidance in January, the U.S. dollar has strengthened, which drives an expected reduction in our revenues of approximately $600 million and negatively impacts adjusted earnings preserved by approximately $0.04.

So looking at convalescent CRM from patients to understand which of those.

That's all used for treatment intervention guides US then we'll actually use those also an interventional model.

So why do we expect in our phase two studies later.

Some or choose three wholly generate human data, though on our vaccine when it comes the impact on event.

This will be supplemented by multiple animal model and.

Plasma levels of neutralizing antibodies used in transfusion therapies. So all in all multi pronged approach to a nail down the type of 11th we should veining for and to keep with the most aspirational goal of getting a vaccine that can be considered.

For emergency use accelerated approval around Q3 this year. Thank you very much.

I think anymore and they can't do it and also glad but with the M. D var. Because we did with it mark scene, we are producing three clinical material. So in case, we decide to go into summer into clinical studies as Michael said you'd be able to lead the media.

Albert Bourla: Bringing this all together now, our current view of the underlying strength, breadth, and projected resilience of our business in these uncertain times allows us to absorb both the incremental $500 million in projected R&D investment this year and the incrementally negative foreign exchange impact to maintain our initial guidance ranges on both the top and bottom row. In addition, I see the long-term fundamentals of our business remaining strong, and following the completion of the ABZON transaction, I expect our business to be positioned to generate at least 6% compound annual revenue growth through 2025. We expect adjusted EPS, obviously, to grow even faster. Now, I will turn it over to Frank. Thank you.

Right talk through next question, Yes next question. Please.

Next question comes from the line of Terence Flynn from Goldman Sachs.

Hi, Thanks for taking the questions.

Maybe to for me the first is.

Given the current environment was just wondering if there any changes to how you're approaching capital allocation here do you expect M&A in business development opportunities to increase I think you had talked on your fourth quarter call about potentially.

[noise] finalizing some deals in the first half a year. So just wondering if there's been any change on that front and then my second question is on your 20 Valent Pneumococcal disease program. We've now seen the topline data for the adult phase three setting come out.

Just wondering what outstanding questions are left here on that program. As you look ahead on a forward and and securing the filing in the fourth quarter. Thank you.

Frank D'Amelio: Thanks, Albert. Good day, everyone.

Thank you very much.

Would you like to make some comments on the capital allocation sure.

So terrence on capital allocation, our priorities remain the same which are obviously dividends and we paid a $2.1 billion dividend to our shoulders this quarter.

Testing in the business and then obviously M&A, some mergers and acquisitions and clearly there's been some value reset.

Industry and you can see some of that with some of the biotechs and obviously as we always do we'll look for opportunities, where we think you know it's a good deal for our company and for our shareholders. The one thing I want a balanced as with though is even though valuations reset.

Of directors and management teams expectations don't necessarily we said at the same pace. So that's always something we have to work our way through but from a high level priority perspective, our capital allocation.

Priorities remain the same.

Thank you Frank and then there Michael is there anything about your waving more on them on <unk>.

Don't going are you anything you can pile.

Frank D'Amelio: Before I walk you through our results for the quarter, I want to comment on the current global pandemic, which is impacting nearly every industry around the world. Despite the challenges inherent in operating in this environment, the fundamentals of our business continue to be strong, and our outlook for the future of the company remains bright. We continue to have a strong balance sheet and a favorable credit rating, which we expect to allow us to access the capital markets as needed, which was demonstrated in late March with the issuance of a $1.25 billion sustainability bond, the first of its kind in our industry. On the supply side, all 49 of our manufacturing facilities remain operational, and we have not seen a significant disruption in our supply chain as a result of the pandemic.

You know, we're very confident in the pneumococcal adult.

Frank D'Amelio: To ensure the safety of our manufacturing colleagues while they perform this critical work, we have put in place enhanced safety measures at all of our plants, including investing in protective equipment, staggering shifts so that fewer colleagues are present at once, restricting site access to only essential workers, and requiring colleagues to log their contacts while on site. I want to acknowledge how proud I am of the way our colleagues, many of whom are on the front lines in this fight, have responded to this crisis with courage and passion. From those who are working around the clock on potential treatments or vaccines for COVID-19 to those who continue to operate our manufacturing and supply chains to ensure patients can have the medicine they need. It is in times like these that the strength of our culture and of our people really shines through.

Often.

Completion of the main efficacy studies that we have done a presently.

And it has the immunogenicity and safety and Tolerability.

We're looking for.

We also recently had a lot consistency started to read out which again showed similar grade profile for the twin dubailand to be used in the other thing.

Frank D'Amelio: Now, on to the finance. First quarter 2020 revenues were $12 billion, down 7% operationally versus the year-ago quarter. Of course, most of this decline is due to the fact that we no longer report revenues for our consumer health care business. Excluding this impact, revenues were down 1% operationally.

We are still having one study that is for patients previously immunized.

I've seen that will be coming shortly but you know for naive patients. We do have all data available looking like if I, just don't profile and Wayne just to supplement.

Frank D'Amelio: As Albert already explained in detail, our biopharma revenues grew 12% operationally this quarter, driven by strength across multiple products with approximately one percentage point of that growth attributable to the net impact of COVID-19 on product sales. Upjohn revenues declined 37% operationally, driven by generic competition for Lyrica in the U.S. and declining sales of Lipitor and Novavax in China due to the implementation and nationwide expansion of the volume-based procurement program Importantly, both of these negative drivers were anticipated in our previous Upjohn guidance. The total company adjusted SINA expenses in the quarter were down 16% operationally.

With that data sets coming on previously immunized, which you know these would be to expand coverage.

And that's why we feel very confident.

Filing and they go hard from up its introduction.

We have moved into Ali.

Before thank you very much.

Thank you.

That's great operator can we go to the next question. Please.

Your next question comes from the line of Randall Stanicky from RBC capital markets.

Great. Thanks, guys just two questions probably built French look can you just talk about the ibrance trends, particularly you five price headwinds when do those abate and how should we think about ibrance growth for this year and then just a follow up on been nickel, the 13% diagnose diagnosis rate it.

Frank D'Amelio: Approximately half of that decline was due to the fact that we no longer report expenses for the consumer health care business. The remainder of the decrease was driven by reductions in field force, advertising, and promotional expenses due to the LOE of Lyrica in the US and lower selling expenses for Lipitor and Norvasc in China due to volume-based pricing, as well as lower indirect SINA spending associated with the corporate enabling function. Both reported and adjusted diluted EPS for the first quarter were down compared to the year-ago quarter. The decrease was primarily due to lower revenues, mainly driven by the loss of exclusivity for Lyrica in the U.S. Partially offset by lower SIN-H levels.

It's nice jump from for Q of 9% any change to where you guys think back and ultimately get to putting aside near term here near term headwinds from from cobot. Thanks.

Good luck.

Sure.

So on Iran, and the E U I a one to your thought on that fundamentals and outgrowth up I brands in the EU continues to be these trial and we continue to see great opportunity you know out into the future right now at the finest line.

Frank D'Amelio: Finally, foreign exchange had a negative impact of $134 million, or 1% of first quarter 2020 revenues and a 2 cents negative impact on adjusted diluted EPS compared to the year-ago quarter. Before walking you through our guidance updates in detail, I want to acknowledge that no one currently knows exactly how and in what time frame the COVID-19 pandemic will progress and eventually come to its resolution. Given those uncertainties, along with our desire to be as transparent as possible, we are providing on this chart the key COVID-19 related assumptions that are reflected in today's guidance update. In summary, our financial guidance reflects our expectation that most healthcare systems around the world will begin to resume their normal functions in the second half of 2020, including in-person doctor visits. New to Brand Prescription Trends, Salesforce Activities, and Clinical Trial Enrollment. The guidance also assumes that we will be able to continue to operate our manufacturing and supply chain without material disruption and that we will continue to invest in potential treatments and vaccines against COVID-19 throughout 2020. With that in mind, let's take a look at our guide.

Metastatic breast cancer share up the PD take class is only got 38. So you know there's room for growth here and a and we do have they started eating marketing 68%.

Okay. So I think just right. There you can see that they like continued opportunities for growth and that is how we see it.

We saw very strong double digit growth full I brand and in Bosnia and Ah what you didn't see and why that didn't translate into that fail. It because we negotiated I and number of very large contract with <unk> large European country.

Any of these happened in Q4 2019.

And because these contract on multi year, what you get here now is it some stability in that and and so this has allowed us to rebase out business. It does impact already into that guidance.

And because of the tightening up Wendy's contract, we signed a we expect to return to net sales growth in the second half Twentytwenty. So all in all I think it's just the timing on the year on year comparison and that is driving.

Frank D'Amelio: Consistent with last quarter, we are providing three sets of financial guidance. As a reminder, those three sets of guidance are as follows. Total Company, which reflects our current construct of the biopharma and upjohn businesses and excludes any impact from the pending Upjohn combination with myelin. 2.

The effect of late.

Sounds good perspective, but I wonder, we intend that fundamentals are strong and value proposition, Iran is strong.

And and we continue.

Tremendous growth opportunity both for the class as well as outcomes here.

And your next question was about the cow and Dan and I think your question was about just sort of diagnosis and whether we're seeing you know anything anything particular, there and a and no I mean.

Yeah. The strategy that we have deployed from the beginning a which is to find and heightened awareness about which patients we should suspect fall and fully TTR yen and then have those patients and be then diagnosed through some timothy continues to be the main.

Frank D'Amelio: New Pfizer, which is a full-year pro forma view that reflects the impact of the pending Vietras transaction by removing Upjohn and including $12 billion in cash proceeds from Upjohn to New Pfizer and other transaction-related factors such as transitional service agreement revenue, and 3. Upjohn as a standalone business. Let me remind you that the Upjohn guidance includes the Meridian business and our collaboration with Mylan and Japan, as we discussed last quarter. Additionally, all of these scenarios continue to be based on a full year of revenues and expenses in 2020. Beginning with Total Company, as Albert mentioned, we are reaffirming our guidance ranges for both revenue and adjusted diluted EPS. Despite absorbing incremental negative impacts due to foreign exchange fluctuations, mid-January of approximately $600 million in revenue and $0.04 in adjusted diluted EPS. Moving down the income statement, we lowered our cost of sales as a percentage of revenue guidance range by 0.4 percentage points to reflect favorability resulting from changes in product mix and other efficiencies. Selling information and administrative expenses, we are lowering our guidance range by $500 million.

Hey, how we are generating diagnosis.

You know what time, we are deploying and we're experimenting with the artificial intelligence and gifts instead of predictive models and that might allow us to again, you know support the suspicion abhi patients that I would say that our strategies have been rather consistent since launch.

And I think that the on the diagnosis rates that were seeing I'm tell us that you know what we've been doing it is working well and it's great receptivity for this product.

Frank D'Amelio: This reflects incremental cost savings opportunities, primarily related to indirect SINA spending, as well as actual and anticipated spending reductions as a result of the COVID-19 pandemic, and, as Albert already spoke about, the $500 million upward revision to our R&D expansion. Finally, our guidance continues to anticipate no share repurchases in 2020. Moving on to financial guidance for new Pfizer and Upjohn, despite absorbing negative incremental impacts on revenues due to changes in foreign exchange rates since mid-January of approximately $500 million for new Pfizer and $100 million for Upjohn, we are reaffirming the fiscal year 2020 revenue guidance ranges for both pro forma companies. Additionally, we are reaffirming the guidance ranges for adjusted IBT margin and adjusted diluted EPS for new Pfizer, as well as adjusted EBITDA for Opdivo.

Well I, both from physicians as well it's on patients.

We are very active on the education front, both from a diagnosis and from a treatment effective. So I you know I think that what we've been doing his that it's really working well and we'll continue to do so.

Right. Thanks for the detail Angela next question. Please operator.

Your next question comes from Tim Anderson from Wolfe Research.

Thank you.

On your 20, Vaillant pneumococcal conjugate vaccine.

Just an update on timing for when we are likely to see the phase three trial start impedes.

To keep that cap with Merck as small as possible.

Frank D'Amelio: The only change to the guidance we gave for new Pfizer is a $1 billion reduction in the range for operating cash flow driven entirely by a $1.25 billion voluntary U.S. pension contribution, which we plan to make in the second half of 2020. Moving on to key takeaways. In the first quarter of 2020, our company performed well in a challenging environment driven by strong revenue growth from our biopharmaceuticals. We reaffirmed our 2020 guidance for revenues and adjusted diluted EPS, and we achieved multiple product and pipeline milestones since our last quarterly update, some of which are listed here, demonstrating the continued advancement of our late-stage pipeline. Finally, we paid $2.1 billion in dividends to our shareholders this quarter. As always, we remain committed to delivering attractive shareholder returns in 2020 and beyond. Now, I'll turn it back to Chuck.

And then second question on edge event I brand, it's just an update on timing of when we will see the data.

And when you do topline that are you likely to disclose any results or is it just gonna be a qualitative topline. Thank you.

Yes. Thank you very much <unk>, let me take we can either be RG 100, benign we might that be bumps are bad and develop and UK anything in the audio we have not Ron and he and the interim analysis yet.

Wallace.

And we expect or as we said before but the study will.

Come to conclusion, excuse me, who come to completion, which means that you're not stop you expect doing things going to be courses I've said very high criteria for stepping.

So and you because you do not go knowledge when we've had.

Unknown Executive: Thanks Frank and thanks Albert for those comments. Operator, can we please poll for questions? Ladies and gentlemen, if you would like to ask a question, please press star then the number one on your telephone keypads. We'll pause for just a moment to compile the Q&A roster.

The interim analysis.

Dave and visibility I guess, if we stop.

So as I said, we don't pay data.

I didn't get form and then I guess is you're gonna and actually I didn't give him give us other you're getting on <unk> and decide they can come to completion is expected early in a trendy trend due out in Medicaid when they can do garland and on the feeds when we can start or the phase three and did you have to add something in the policy.

Operator: Your first question comes from the line of David Reisinger from Morgan Stanley. Yes, thanks very much for the detailed review and congratulations on the performance. So, I have two questions, please. The first is with respect to the guidance, and the second is about the vaccine candidate. So, with respect to the guidance and the assumptions on slide 13, could you just discuss what you're assuming with respect to a potential resurgence of COVID during the start of the flu season in the fourth quarter and the impact of that on healthcare systems and physician visits? And then, second, with respect to your vaccine candidate with BioNTech, could you just discuss your level of conviction that you have the right candidate that will be safe and effective, and when do Thank you very much.

Thank you very much.

And team for the question.

You know we.

Opted a press release.

The three injections immunization would need we laid there said that the fourth those Florida substance it today.

We have had the extensive regulatory dialogues into U.S. and elsewhere and Shadows data set.

So.

We are planning to start the Pete.

Yeah.

Seems to be a twin the very soon we're talking likely about just a few weeks to be clear.

That's our projected plans right now and I think you said it very well on the had you then.

Ibrance studies that.

We feel very optimistic.

Optimistic and good about them and just waiting for it.

Them to the you know report the F. One did they have communicate.

Frank D'Amelio: Dave, thank you very much. Very good questions as usual. For the first one with guidance, let me ask Frank to make comments about the assumptions.

[noise] like you Angela you Wanna add anything on the pediatric marketplaces, we see it potentially playing out.

Frank D'Amelio: And so, David, in our guidance, we are assuming a recovery in the second half of the year. We expect the second quarter to be the quarter that's primarily impacted in a negative way from the COVID-19 virus, but we do expect a recovery in the second half of the year, and that includes, you know, the items that we talked about in our comments, in-person doctor visits. Start up again, new-to-brand prescription trends, sales force activities, clinical trial enrollment, and obviously all of our sites continuing to operate and provide medicines to patients the way that they're currently doing today. So punchline, second half recovery, and the health care system returns to normal operations.

Sure Jeff Ted you said, a we will launch and tentatively opted the at them that 15. However, we don't anticipate that he I people make at preferential recommendation between the two and therefore, we believe that PCB 13.

Well I'm compete with 15 until the PCB 20 comes to market.

And you know we are confident about PTP 13, it has tremendous experience with health care professionals. We have very strong account management developed to occur without customers through the years that we've been on the market and we also habit very reliable supply track record.

Albert Bourla: Thank you, Frank. And now, Michael, I think you would like to comment on the vaccine. Before I say just one thing about the vaccine, that this is a new technology, but we are very familiar with both the technology and the company because we have been working with them for the last two years in a joint project to develop a flu vaccine using the same technology. So we jumped into COVID-19 when the need emerged jointly together, and we are applying, of course, all the learnings of

And so a lot of despite the at the maybe gap in launches a we anticipate to be competing in the market and to to continue to less support the benefits of PCB 13 team.

Right. Thank you operator can we please move to the next question.

Next question is from Louise Chen from Kantar.

Hi, Thanks for taking my questions here. So my first question for you is do you have any update or more details on the go forward strategy for Pfizer post the up John separation as it pertains to M&A pipeline assets, what you're thinking about fair and then what in your de M.D. phase one be date I gave you confidence to move into.

Michael Dolsten: technology during the last two years. Now, Michael, can you please speak more specifically about this specific project?

Michael Dolsten: Thank you Albert and Dave for asking this important question. I would start by saying I think we have the most comprehensive SARS-CoV-2 vaccine program currently ongoing, and it's specifically related to mRNA. As Albert alluded to, we had built a lot of experience on the various types of mRNA and the formulation of lipid nanoparticles through two years of work on flu and a lot of different animal data coming from our work and work from BioNTech on both Oncology and other programs. When it comes to the specific... Light Speed Program, as it's called, that has basically, in, 2-3 months moved from the drawing table to dos What MNR type, what antigen is the most effective and allows us to pick one or two to move into pivotal studies? So that covers unmodified mRNA, modified, and self-amplifying. To the best of my knowledge, we're the only one currently having self-amplified mRNA in the clinic, which would allow you to dose at a lower dose than any other construct.

Phase three studies, where are you with manufacturing and what type of data do you think you'll report out at A.S.G.P.T. and then my last question here is just back on PC V. 20, just curious if you think from the adult side that the Sip recommendation would change at all if you were to get approved for PCB 20. Thank you.

Thanks, Let me maybe speak a little bit on but not the gentleman named enjoy Mexican or can that it's come back and then I will ask my thinking them and when the DMD and then maybe I'm going to own the PC Btwenty again holiday CAC, we'll do the adults when they go first rather than our son is very clear and remain the same forced the as expected support.

Jason I'm zone, Pfizer will become a top line a best in class growth story, and we are feeling more and more confident about it we're strengthening our language and are on the 6% today I said that at least 6% will grow and to bother. We expect that there will continue no the M&A.

He is not the striving to eat these Ah Ah attribute to support the stronger.

And that's why the M&A in the past, we're much more geared towards buying revenues or buying earnings growth by big mergers that got the cost because this is what we need it about time right now moving forward, we are not being the need to buy you'd be us already be us will grow regarded equally as our revenues we grew.

I've gotten a good so or emanate, although we never say never or on anything nominate right. Now is we continue but our strategy is not to go to a beep.

Michael Dolsten: We already have animal data from rodents on the various constructs that are encouraging, and we also have data from patient sera that shows that the two antigens that we picked seem to be the most relevant for intervening and utilizing viruses. And by having picked two spikes or the smaller component receptor binding domain, again, I think we will be able to cherry pick what turns out to translate most effectively in man. So more animal data will come in over the next few weeks on primates. And I expect human data to come late in May or June from the first experiments performed on plasma from vaccinated patients. And this is a unique trial design with continuous data flow that should allow us to progress fast and share data with regulators. So we expect a flow of data in May and June and then move into expanded trials that could allow emergency use or accelerated approval coming in the fall, possibly October and onwards. So thank you very much for your question.

And with me for the following three reasons one it is that a very few targets will provide the we're not dilute our growth very few.

Most of them will grow less than us so wouldn't have dilution secondarily about a topic is usually they want the significant premium and the most who makes me feel that most of the values come through by the shareholders will be acquirer like the one that was making their creation and of course, a those big acquisition are creating.

I'm destruction suites R&D could be.

Finished so these other considerations in terms of send where are we going to invest our capital. If this is not our first priority and for the reasons that they said.

We are going to invest in the air leave face to face three ready to start or what kind of so medicines, but the good to be part of our pipeline. So but there were strengthen the pipeline, but he's coming force as products sportsmen Department. The 600 728.

So a lot there can sustain the growth, but already we feel very confident.

We've had organic early in the next five six years.

So that's one of our strategy and the enemy no DMD, Michael what makes you optimistic.

Albert Bourla: Thank you, Michael. And also, let me add here, the reason why we jumped into this is not only because we had familiarity with the company, with the technology, and we had discussed this project that was very exciting, but also because we are uniquely positioned to help during this crisis because we have end-to-end capability. We have very strong capabilities from early preclinical research all the way to manufacturing. And frankly, as we have said, but I make it very clear now also, we are planning to manufacture this vaccine at risk. So if the technical success and regulatory approvals are there, we will have doses available during the last quarter of this year. And also, it would be an omission if I wouldn't mention right now how grateful we are for the advice and collaboration that FDA is giving us, that they are trying to work their timelines day and night as well so that they can help bring a solution to the world. Thank you very much. Let's go to the next

Yeah. Thank you very much I mean, it's such a transformative area treating these boys.

We do Shannon.

We are now treated a sq, we learn more at the conference.

Seven patients eight of them at the high those three into the 40.

And we continue to show see very consistent.

Based on efficacy looking at deduce drove an expression the distribution of <unk>.

And you know as we have to you did a more patients and the early boys that were treated we have no longer observation period. We can also see that your ability. It seems to you know exceed the 12 month when it comes to any victory on which makes US you know feeling very good that this could be.

Long durability for these boys and we also have data coming out the muscle health.

Throughout the entire nice and more recently MRI that allow us again to add another level of confidence that wishing to handle some of the muscle and finally.

Operator: Yes, next question. Thank you.

Angela Hwang: Your next question comes from the line of Chris Schott from J.P. Morgan here. First, on Vendickel and the impact of COVID. It sounds like you're expecting a slowdown in diagnosis rates in the quarter. Should we also expect that prescriptions and patients receiving drugs should also slow, or could those actually keep ramping up? Once you've identified a product, can they keep working through the process? My second question on Vendickel was also about payer mix. You've had a little bit more experience with the product, and we're still trying to get a sense of where gross to net could shake out for the product. So any additional statistics here in terms of how many patients are getting free drugs, how many are reimbursed, any data there would be very helpful.

For the motor function, well you use clinical scale.

We have seen now crossed.

Number of treated the boys.

Paypal data on and on the North Star Index, and I want to point out that we've seen it crossed different ages.

Because if humanely monitor only boys foot is they do have some continuous improvement that could be difficult to differ from treatment in June but we've also seen it's no wonder boys, what do you expect decline, but we have noted improvement instead.

Angela Hwang: My final question was on Prevnar in infants. Are your expectations for that product for the year unchanged? So we're going to obviously see you get 2Q impact, but you get kind of a catch up in the second half of the year? Or should we actually be thinking about Prevnar infant expectations for the year coming down as that catch up won't offset the lost sales in the quarter?

So all in all we feel that we have now accumulated a very robust they let's say on if he could see and we have launched important experiences helped to mitigate risk and manage any possible safety then.

Of course, we have one of the largest airports immune therapy manufacturing that it's been expanding in North Carolina and that will all come together now or in our plans to start.

Angela Hwang: Thanks so much.

Angela Hwang: Thank you, Sot. I think all three questions are very well suited for Angela to answer. So, Angela, why don't you start with Dr. Rindell?

Phase three trials in just a few months. So thank you for your interest.

Angela Hwang: Great. Thank you. Thanks for those questions, Chris.

Thank you Mike.

Very exciting news for for these boys went through doesn't go forward because a good shape emotionally comes right now Angela what about Oh, we used on the what could be the recommendations are facing be on a on the adult.

Angela Hwang: So firstly on Vindical, as you can see, we continue to have great momentum behind this product, and we do believe that this will sustain its performance throughout the year. However, as Albert mentioned, we do think that there will be some slowdown in NRXs in the second quarter.

We'll go vaccine between.

And I'm going to do so yes. So you know we're really excited about our PCB Twentys program and that's specifically about the breadth that serotype coverage that PCB twisted tea provide and we really see the benefit in two ways. One aspect of all these include.

Angela Hwang: And actually, just to align with those comments, we did see that in our patient hub enrollments, since the middle of March, we saw a decline of about 20% in the last four weeks compared to the previous four weeks. So I think that this comment about new patients' jobs is one that we are seeing in the patient hub. However, let's also think about the great attributes of Vindicale.

Mental stereotype associated with high case fatality rate antibiotic resistance and on meningitis. So these off that serious diseases that these serotype they'll be able to cover.

Angela Hwang: It's an oral medication. It's one that is being delivered through a specialty pharmacy directly to patients' homes. It's one that, because of its mortality benefits, decreases hospitalizations. All of these really play well with the time that we are in right now in this pandemic.

But also relative to P.T.D. 15, P.D. twentyth expects it to provide 33% more coverage again I P D strains in adult.

So with these data our plan is to bring the full in.

To the CDC and Todd regulatory authority, and we will certainly be successful recommendations and what all this means I think guy in the end. We all know that this is a decision that the CDC needs to make and we will be.

Angela Hwang: And so we anticipate our continuing patients will be able to continue on their drugs and be able to stay on therapy. So there will be no impact on TRX. Your second question was around the payer mix. And on that front, we have not seen a change in terms of the numbers of patients on commercial versus Medicare versus other books of business. That has been pretty consistent through the time since launch, and our Medicare patients are the predominant part of our patient population. And that hasn't changed at all.

Having these conversations with them as our program develop I, but certainly we feel very strongly about the potential benefits and the with the additional coverage that PCB twinkie can provide and you know, we'll keep you posted with what happens with that with the CD.

Thank you.

Thank you hadn't yet and zone.

Do you have to any comments on our go forward strategy given that you're monitoring this everybody success, we're at now and particularly on M&A targets or licensing targets that we've had.

Angela Hwang: And then I think your third question was on Prevnar-P. And on Prevnar-P, similarly consistent with comments made earlier, we do anticipate the second quarter to have some slowdown. And this is just because while visits aren't taking place, there is a lot more caution regarding visits to pediatricians' offices. So we do anticipate some slowdown there. But we also know, both from our own research and from our representatives, that pediatricians are anxious and are motivated to get the well visits back and to have our infants as well as our children vaccinated. And therefore, based on that, and based on the fact that we expect a recovery in the second half, per Frank's comments about our assumptions, we do anticipate a catch-up towards the second half of the year that will allow us to attain our expectations that we had for P for all of them.

Hi, Thanks, Oliver and.

The question.

Obviously, we don't talk about specific targets as you all know, but I think Albert said, it really doesn't mean pellington, our and his answer which is we feel really good about the prospects for they continued growth of our core business.

In terms of business development to strengthen our focus is absolutely on clinical stage assets I think Frank touched on this and his answer to capital allocation earlier on but we're really very focused on clinical stage assets. It complements our existing internal pipeline that we feel good about.

So we're going to be focused on areas, including oncology, where there could be interesting tuck ins were going to be looking at rare disease is a lot of innovation taking place there and I think were uniquely placed because of the capabilities in manufacturing and development Michael's touched on two to our pipeline.

Angela Hwang: Operator, next question please. Hi, thanks so much for taking my question.

We need to look across you know our other is seen as well at select opportunities. So we think there were opportunities. There. We're continues to be very active in this space.

But of course, we're always going to make sure that we're disciplined.

We deploy capital and away that really optimize these value for our shareholders, but most importantly for patients. So think between you know Albert's and ER Frank on so hopefully that gives you a flavor I really feel about capital deployment and business development for our business strategy post say separation about John.

Michael Dolsten: I hope you all are staying safe. Michael, on your antiviral for COVID, you're going down the protease inhibitor track instead of the nuclear one. Maybe you could explain the thought process and if you could also lay out for us the exact EC50 that you're seeing with your 3CL inhibitor. I ask because some of the initial 3CL inhibitor constructs you had chosen against SARS had EC50s above 10. So I wonder if you are seeing something closer to one on the protease inhibitor you've chosen. And secondly, on the COVID vaccine, Michael, I'm curious what the exact threshold of neutralizing antibody titer that you want to see for you to say, you know what, we have something.

Thank you very much I'm not sure if we answered most of the question on the about manufacturing and yes, we feel very good about manufacturing our investments are progressing very nicely and you'll be able to manufacture at scale for the dnbi, providing but the successful enbridge.

So a tuck ins go to the next question, Yes, Please let's move to the next operator.

Your next question comes from Steve Scala from Cowen.

Michael Dolsten: Thank you, Mr. Michael. The stage is yours.

Thank you Ive a few questions first on EPRA sit tonnage I believe only the higher dose was better than dupixent, but there were safety issue said that dose.

Michael Dolsten: Yeah, thank you very much, Umer. There are some great questions here.

Michael Dolsten: So let's start with protease inhibitors. You know, we have the privilege of this isn't just a repurposed protein inhibitor from a distant relative. We had a collection of compounds that showed very potent activity against the SARS-CoV-1. And we were able to model and show that there is a very strong similarity in the binding and have confirmed that these compounds on SARS-CoV-2, the COVID-19 disease, are very potent. We are talking about, you know, a very potent non-molar type of binding, and this is supported by X-ray data available that shows, again, unique, highly selective binding patterns. What we are now doing

And it was not superior on edge. It seems the outlook is not all that positive you, obviously think differently. So could you explain.

Secondly, you spoke about the palace trial, but to clarify the Penelope be Neoadjuvant trial did you say the readout is now Q1 of 21.

We had thought it was likely to be topline. This here and then lastly can you just quantify the illiquid stocking in the quarter. Thank you.

Thank you very nice aggregate very quickly I'm, saying that they never be no big Penelope is expected to come the second half of this year. The palace is expected to come early next year. This is exactly as you can said it before Mike why do you I'm excited about that but sitting here.

Yeah I you know we are very excited about upper 50, a bond lift meals punctuate a few thing.

Michael Dolsten: Cellular Antiviral Studies, Initial data is encouraging again, showing potent activity, which needs to be studied on different cell types where the virus may be harbored. All together, we think these are very promising drug candidates, and we're moving swiftly ahead with scaling up, adding other IND-type data to potentially pending regulatory dialogues that have initiated, and be able to dose patients around August this year. We're also working on oral full-on drugs and have identified several candidates that show suitability for this type of delivery system. So all together, I feel very encouraged that this could be the Prostanclos protease drug for SARS-CoV-2, and we'll keep you posted as we advance. On the vaccine, clearly, we are looking at, you know, what could be animal data guiding us on what should be the relevant threshold in order to have neutralization of the virus.

Into Jade compares study, we showed that both high and medium doses Smith co problem or endpoint in very effectively reducing.

Exceed mom.

I had a key secondary endpoint or <unk>.

Comparing it to.

Two dupixent standard of care.

And this is one of the most and patient centric endpoint impacting quality of life at both they and nighttime.

And at a high dose statistically significantly showed better effect clinically meaningful and picks them.

Well I am.

Lower dose the hundred milligram numerically, what's better but they didn't reach statistical significance.

Overall, what we see is more rapid onset with our poll around upwards into need then the biological.

Depicts and and we see more rapid onset numerically, whether you look at steam clearance or where do you look at the have itch.

And what you know why there is some more infections or ways with higher doses JAK inhibitors.

Michael Dolsten: And we have, in discussions with regulators, gotten good feedback on data from multiple animal models that we are pursuing that could help to possibly even create the surrogate entity. We're also looking at convalescent serum from patients to understand which of those... that are used for treatment intervention guide us, and we'll actually use those in intervention models. So while we expect in our phase two study, later this summer, early Q3, to generate human data on our vaccine when it comes to impact on events, these will be supplemented by multiple animal models and plasma levels of neutralizing antibodies used in transfusion therapy. So, all in all, a multi-pronged approach to nail down the type of levels we should be aiming for and to keep with the most aspirational goal of getting a vaccine that can be considered for emergency use, accelerated approval.

We we think and I believed that the benefit.

Versus the risk is still very favorable this or mild to moderate case is most attenuate.

And basically all of 10, <unk>, if you discontinue treatment and I want and finally I emphasize that we have a very exciting yep additional trial that is not necessary for filing.

It's coming later this year that trial regimen.

That really study if you start on that 200 milligram, which we know will clear scheme with usage much faster than standard of care and then you can switch you know maintenance to 200 milligram, which you know like do you have a lower level all of them.

Andrew adverse events, including infection that give you potentially mex flexibility to treat them you know, it's Jim Keane I'm going to lower dose, but again the benefit risk to me it looks very favorable also for the higher dose.

Infections are relatively mild to moderate and can easily be manage and or you know quite coleman for a patient treated by dermatologists. So I feel very good about I do being superior and the low dose being somewhat similar to dupixent still having.

Michael Dolsten: Thank you, Michael, and also to add that with the antiviral, as we did with the vaccine, we are producing at-risk clinical material. So in case we decide to go into clinical studies this summer, as Michael said, we will be able to do it immediately.

Albert Bourla: to the next question. Yes.

Operator: Next question, please. Your next question comes from the line of Terrence Flynn from Goldman Sachs. Hi, thanks for taking the questions. Maybe two for me.

The onset of action numerical <unk> and its poll rather than very convenient to take I hope that gave you a good sense why you feel encouraged to see these new treatment options for patients moving to regulatory discussions and hopefully soon available in June.

Frank D'Amelio: The first is, given the current environment, I was wondering if there are any changes to how you're approaching capital allocation here. Do you expect M&A and business development opportunities to increase? I think you talked on your fourth quarter call about potentially finalizing some deals in the first half of the year. So just wondering if there's been any change on that front. And then my second question is on your 20-valent pneumococcal disease program. We've now seen the top line data for the adult phase three setting come out. Just wondering what outstanding questions are left here on that program as you look ahead to the forward and secure the filing in the fourth quarter. Thank you.

Thank you, Michael and an angle I wonder about the inventory levels can you explain.

I think which yes in terms of just the illiquid impact what we saw was a a an uptick intense off on inventory level to a two hour prepare for the pandemic and impact with about you know in the mid single digit intent that worldwide.

Right. Thank you.

We have turned for a couple more questions operator can we moved to the next one.

Next question comes from the line of Andrew Baum from Citi.

Frank D'Amelio: Thank you very much. Frank, would you like to make some comments on the capital allocation?

Thank you I know you've added a couple of very distinguished sponsor support also added format.

Frank D'Amelio: Sure. So, Terrence, on capital allocation, our priorities remain the same, which are obviously dividends, and we paid a $2.1 billion dividend to our shareholders this quarter. Investing in the business, and then obviously M&A, and acquisitions, and clearly there's been some value reset in the industry, and you can see some of that with some of the BioTechs. And, obviously, as we always do, we'll look for opportunities where we think, you know, it's a good deal for our company and for our shareholders. But one thing I want to balance this with though is even though valuations reset, But from a high-level priority perspective, our capital allocation priorities remain the same.

<unk> commissioner onto Khatami out that as well as the mind on a transaction.

Should we think about this has been accelerate evolution of sites are in times of trying to improve the ROI.

It has had historically on all the and if so I'm quite home the messages I outlined perhaps you could highlight I can't live in time, though I do organization called onto Richmond. This call home that also points in that direction and then second to Mike I'm quite the seems to have pivoted away from.

Our immuno oncology as many others on given its appointments pace PD one if we do see the emergence of novel I O targets such as.

Michael Dolsten: Thank you, Frank. And then, Michael, is there anything that you are waiting for on the hemococcal adult vaccine, or do you think you can file?

My mother's out that the randomized phase two trial.

But I assume that Pfizer willing to reengage backing that feels and I am I not exaggerating the types of.

Michael Dolsten: You know, we are very confident in the pneumococcal adult. After the...

Finally, but it does seem that you have pivoted back towards small molecule. That's fine if your comments on the anticipated treatment duration in the real world setting a pilot given the issues with adverse events is what is we invest for friction from Medicare patients.

Michael Dolsten: Completion of the Main Efficacy Study that we did a press release on, and it has the immunogenicity, safety, and tolerability that we were looking for. We also recently had a lot of consistency studies to read out, which again showed a similar great profile for the 20-valent to be used in the adult set. We are still having one study that is for patients previously immunized with a plumbococcal vaccine, but that will be coming shortly. But you know, for naive patients, we do have all the data available, looking like a very strong profile, and we aim just to supplement it with a data set coming on previously immunized patients, which would be to expand the coverage. And that's why we feel very confident about filing. And you heard from Albert's introduction that we moved it to early Q4. Thank you very much.

Yeah, I'm going to can you repeat the first part of your question the other why.

Yeah. So obviously you, saying that you know onto your tenure out but there's a notable addition of three individuals with high scientific calipers. So obviously.

Who must be a commission that but also to break distinguish sanches as well as de complex is find the organization by by the up John transaction.

So when I think about the evolution the business on the Pfizer It does seem as a consensus attempt to try and shine more lights will improve the ROI to some of these matches. So <unk> are there any of the internal bashes talents in Richmond inside the organization or do you honestly structure is designed to improve R&D either through et cetera.

Pro times, killing Ali the normal stuff, but it's something changed in the profile of improving the ROI and R&D.

Michael Dolsten: Thank you. That's great. Operator, can we go to the next question please?

Particularly I got it no no. Thank you very much.

Operator: Your question comes from the line of Randall Stunnicky from RBC Capital Markets. Great. Thanks, guys. Just two questions, probably both for Angela.

Absolutely, yes, it's not bites arms, but right now in our board we have a five top scientists.

Angela Hwang: Can you just talk about the IBRANT trends, particularly the EU5 price headwinds? When will those abate? And how should we think about IBRANT's growth for this year? And then just a follow-up on Vindical; the 13% diagnosis rate is a nice jump from 4Q of 9%. Any change to where you guys think that can ultimately get to, putting aside near-term headwinds from COVID? Thanks. Angela, go ahead.

Four of them physicians hope signed this but they have a unique expertise are there in a regulatory science there haven't really unique expertise in development. They have Unix expertise in basic science, both in primary care in the doubling diseases and immunology. We have also through she was on folks feel.

She was the pioneer, bringing together or the genomics data we've commutation power.

Angela Hwang: So Ibrance in the EU: I want to affirm that our fundamentals and our growth for Ibrance in the EU continue to be really strong, and we continue to see great growth opportunities, you know, into the future. Right now, the fullest line metastatic breast cancer share of the CDK class is only at 38. So, you know, there's room for growth here. And we do have a strong leading market share of 68% of all CDKs. So I think just right there, you can see that there are continued opportunities for growth. And that is how we see it.

She was the first biologists and personal meant to be any right.

Okay, and taking over there might be and there's a very clear statement, but 500 different Pfizer is a science based company and this is where the growth is coming.

And we are adding those should board members to provide more visibility, but closer because they help us with their very high Nolads no. There's not one or two there are multiple measures, but metrics that you are using to assess if indeed, our R&D machine is a new machine.

If we can.

On the only thing be Sir your strategy and are they are all pointing in this direction I think we've made very clear, but suburban Pfizer the Pos.

Angela Hwang: We saw very strong double-digit growth for iBrands in volume, and what you didn't see and why that didn't translate into net sales is because we negotiated a number of very large contracts with certain large European countries. Many of these happened in Q4 of 2019.

Because you ask a question of how if you can kill weekly and if you can or let's say progress things that they really matter rather than move everything.

Pfizer the Pos could the success rate well phase two studies of 16% when I say over the past few years Mark.

Angela Hwang: And because these contracts are multi-year, what you get here now is some stability in that. And so this has allowed us to rebase our business. And because of the timing of when these contracts were signed, we expect to return to net sales growth in the second half of the year. So all in all, I think it's just the timing and the year-on-year comparison that is driving the effect of what you're seeing from a net sales perspective, but I want to reaffirm that our fundamentals are strong, the value proposition of Ibrance is strong, and we continue to see tremendous growth opportunities both for the class as well as our own share.

15% when the interested or was it sorry.

Today, Pfizer success rate it is close to 50% five zero and that's when they're rolling.

For years.

Assessment right now and I'm sure next year would be 50% or rolling 50 person.

And so this is not the only one in 2018, we were the company, but introduced most new molecular entities of anybody else would expect a 25 during the can go on in North Zone Young kids, a very detailed leaseup of criteria and Hughes monitoring the governing process, but this is making sure but there's reallocate copy.

We are located with R&D ROI in mind.

And also I would like there the speed with which the company is reacting because nothing to do with a company over the past and by the way. This is very well indicated in the way that we were able to move.

Angela Hwang: Your next question was about Zyndacal, and I think your question was around just sort of diagnosis and whether we're seeing, you know, anything particular there. And no, I mean, the strategy that we have deployed from the beginning, which is to find and heighten awareness around which patients we should suspect for ATTRCM and then have those patients be diagnosed through scintigraphy continues to be the mainstay of how we are generating diagnoses. You know, with time, we are deploying and experimenting with artificial intelligence and different sorts of predictive models that might allow us to, again, you know, support the suspicion of these patients. But I would say that our strategies have been rather consistent since launch, and I think that the diagnosis rates that we're seeing tell us that, you know, what we've been doing is working well. There is great receptivity for this product, both from physicians as well as from patients. We are very active on the education front, both from a diagnosis and from a treatment perspective. So I think that what we've been doing is really working well and will continue to do so.

Better than anybody with deck in speed in developing vaccine or into speaking developing an MD viral.

And the reason why would have been able to accomplish this speed. In addition to bicultural you just answered but you can break the company the into five distinct ER business units Bless you won.

Actually the six together with cost becomes business units and each one of these business units, where jungle colds remark seems rare diseases. They operate like a biotech they make decisions end to end from cumbersome to Everly R&D within this.

Structure like as I said either were.

Biotech company and they are presenting their requests for finance and into the.

Coming to the getting young he's managing someone's going to look at the car.

And last but not the least although Pfizer is laser focused on this and although you'll find the as we are progressing it was absolutely subordinates understanding it was absolutely none.

We should not be anything not the one of our criteria when we jumped into the core with 19.

Programs, the only criteria about three years as we dumped into the called <unk> in Brazil worse. If we are we didn't have a solution. If we can make the difference if we think about our technology is good one so about two can pretty good vaccine or an undue viral because this is not the times, but the ROI.

Angela Hwang: Alright, thanks for the detail, Angela. Next question, please, operator. Your next question comes from Tam Anderson from Wolf Research. Thank you.

Angela Hwang: On your 20 valent pneumococcal conjugate vaccine. Just an update on timing for when we are likely to see the phase three trial start in P, to keep that gap with Merck as small as possible. And then a second question on adjuvant, Ibrance, just an update on the timing of when we will see the data. And when you do top line that, are you likely to disclose any results or is it just gonna be a qualitative topic?

Prevail garbage might be if these farms about the solution should be phone.

So we've talked.

I Hope I gave you some color on how Pfizer is changing and what is the then the mini which is more than symbolic of appointing then you'll board members and their go to Michael or to answer your second question.

Yeah. Thank you for that Chris you know, we think one needs to be careful and not through everything under the kitchen sink into immuno oncology.

I wanted to share with big data, that's what we have learned often to.

Initial position or P. lexia.

Albert Bourla: Yes, thank you very much. Let me take the adjuvant quickly, and then Michael, please answer the trend development question and Ed if you have anything on the adjuvant. We have not run any interim analysis yet on the PALAS study, and we expect, as we said before, that the study will come to completion, which means that we will not stop, we expect, during the interim because we have set very high criteria for stopping. So typically, we do not announce when we have interim analysis data and visibility, unless we stop. So, as I said, we don't have data, we haven't performed an analysis yet, an analysis has not been performed. Typically, we don't announce it, and the study will come to completion as expected early in 2021. So Michael, on the pitch, when we can start phase 3 and if you have to add something in the palace.

One example is by functional antibodies.

We have a dose escalation of a b C. Maybe by functional that looks very encouraging with sub acute unique profile and.

We have pulled on PD, one or by functional slight declines that can boost immune system.

We have oncologic virus.

You know we were successful combining inline with pediatrics and we're building on that experience to now move from actually our Boulder, you'll need for my Ray.

Well molecule. This year that we think is an immune and hans or 14 cents or an X amount or you need better. So I hope you got that.

On sort that we'll share repeating the areas, where we think we can.

Break resistance to I O rather than just throwing everything.

On onto these nicely.

Thank you very much for your question sorry, Andrew So sorry, yes, let's let's try to get a couple more and operator next question. Please.

Question, just from the meal Devons from Mizuho Securities.

Michael Dolsten: Thank you very much, Albert and team, for the questions. You know, we, after the press release about the three injections, immunization, or feed, later shared that the fourth dose further substantiates the data. We have had extensive regulatory dialogues in the U.S. and elsewhere and shared all those data sets.

Great. Thanks for taking my question. So one maybe following up on the adverse to me question come before Steve's question from like I think if he doesn't have any efficacy side and the convenient side. Because my question. Just one thing he now that you've seen the compare data and if you think about the filing just your level of confidence.

On the label being clean from some of the Black box warnings that he can Jackson to infection wouldn't get done obviously also btds you're talking a dermatologists if you like to be critical for it to be a lot of like block in order to compete with the product like to pick something maybe just you can share your views there and then pick one also on the.

Michael Dolsten: So we are planning to start the P and PCV20 very soon. We're talking likely about just a few weeks to be clear. So that's our projected plans right now. And I think you said very well about the adjuvants. Ibrance studies that we feel very optimistic and good about them and are just waiting for them to, you know, report on the dates that we have communicated.

Immunology pipeline.

Your Jack three yeah, one six year zero I, just curious on timing of that I think clinical trials says that the trials because I can't read all the pace to phase three experts in September this year.

Also said that still recruiting patients. So just trying to get a better something when you might see data for that product I noticed breakthrough status.

Michael Dolsten: Thank you. Angela, do you want to add anything on the pediatric marketplace as we see it potentially playing out?

Thank you. Thank you very meal, Michael Zombie immediately.

You know I've received an IP, we have a large database I feel that in a very good about its profile. We have not seen any you know cardiovascular issues and that's really what is worrying about safety why did we see that's expected.

Angela Hwang: Sure, Chuck. So, as you said, we will launch tentatively after the MERPF-15. However, we don't anticipate that the ACIP will make a preferential recommendation between the two, and therefore, we believe that PCV-13 will compete with 15 until the PCV-20 comes to market. And so, despite the possible gap in launches, we expect to be competing in the market and to continue to support the benefits of PCV-13 to infants.

Some viral skin infections.

Conceded that more of you know.

Safety, Tolerability, and they're very mild and moderate and can be well manage would stand out experience in medical practice I cannot speculate about like books, that's really for regulators.

Our next three another piece yeah, that's a very unique profile. The most selective all got that I've seen this fall.

We think we don't will be.

Probably as we have predicted.

21, and this is a pivotal study that could go quickly to filing we do have end of this year, a number of JAK inhibitor readouts into phase two.

Unknown Executive: Right, thank you. Operator, can we please move to the next question? I'm Louise Chen. Hi, thanks for taking my questions here.

Like you actually going to be delight go we have already took two in psoriasis and topical in atopic dermatitis. So we'll keep you busy with a flow of news. Thank you.

Operator: So my first question for you is:

Thank you Michael operator can we get another question. Please.

Albert Bourla: Update or more details on the go forward strategy for Pfizer post the Upjohn separation as it pertains to

Next question is from Nuveen take up some you'd be at [noise].

Albert Bourla: MNA pipeline assets, what you're thinking about there, and then what in your DMD Phase 1b data gave you confidence to move into Phase 3 studies? Where are you with manufacturing? And what type of data do you think you'll report out at ASGCT?

Hi, Thanks, so much less need for me be a thanks for fitting me in Michael just wanted to.

Just touch upon the commentary with regards to the regulators are allowing surrogate markers for as a source could be two vaccine. So wanted to dig into that a little bit more what specifically or will they be looking for that allows a speedy approval and then one understand the manufacturing targets that you have by your.

And if approved.

If approved I just want to understand is that.

I'm, assuming it's gonna be under as sort of expanded axis, you use basis for healthcare workers.

Albert Bourla: And then my last question

Albert Bourla: PCV20. Just curious if you think from the adult side that the ACIP recommendation would change.

And then what do you need from regulators or abroad approval for the general public or any kind of clarity around that would be helpful.

Albert Bourla: Would your recommendation change at all if you were to get approved for PCV20? Thank you.

Albert Bourla: Thank you. Let me maybe speak a little bit on the strategy for M&A, and then John can also add to that. Then I will ask Michael on the DMD and then maybe Angela on the PCV20 again how ACIP will do with the adults. On the go-forward strategy, our strategy is very clear and will remain the same. Post the expected separation with Abzone, Pfizer will become a top-line, best-in-class growth story. We are feeling more and more confident about that. We are strengthening our language around 6%.

Yes, I do not know how the regulators would like to regrets about children I believe it the.

Them, but I can answer the question Andy on the manufacturing. So we expect that we will have a either last quarter busier millions of those just basically right and then before 21, we could ramp up 200 million doses.

Albert Bourla: Today I said at least 6% will grow, but we expect that it will continue. Now, M&A is not a strategy. It is a tool to support a strategy. That's why M&A in the past were much more geared towards buying revenues or buying earnings growth through big mergers that could cut costs. Because this was what we needed at that time.

And Mike maybe a little bit the you can answer the question about the endpoints or the stocking and point that I know there are of course into both regulate the sun pharma to see how we can dawn maximally to allow potentially very important vaccine quickly to deal with this.

Albert Bourla: Right now, moving forward, we are not in a need to buy EPS. Our EPS will grow organically as our revenues grow organically. So our M&A, although we never say never about anything in M&A, right now, it is, we continue that our strategy is not to go to a big M&A for the following three reasons. One, it is that very few targets will provide growth and will not dilute our growth; very few. Most of them will grow less than us, so we'll have dilution. Secondly, that targets usually they want a significant premium. And that makes me feel that most of the value is captured by the shareholders of the acquirer, like the one that is making the acquisition. And, of course, those big acquisitions are creating some distractions, which R&D could be.

Both medical and.

ER business crises. So we have had ample discussions with the highest level all the regulatory leaders in both you is in Europe.

On the surrogate side there are two animal guiding principle, if you can show for life threatening diseases data and we are pursuing mice slash hamsters as well as probably much studies that are ongoing and.

And and we'll hopefully show to us what level of the.

Immune activity interferes with the virus.

And we also doing some I think really create the studies, taking patient Sandra and testing them how that can intervene in these models and trying to correlate well the lesson.

Albert Bourla: So these are the considerations. In terms of then where are we going to invest our capital, if this is not our first priority for the reasons that I said, we are going to invest in early phase 2, phase 3, ready-to-start potential medicines that could be part of our pipeline so that we will strengthen the pipeline that is coming post, as products post-25, 26, 27, 28, so that we can sustain the growth that we already feel very confident about. We have naturally in the next five... So that's on our strategy and NMNA. Now, DMD, Michael, what makes you optimistic?

Patient transfusions, and what levels protect the disease or you know.

Can a halt the progression of disease in patients. So I think this is a unique area, where we will have human and animal data coming together in Q3, two possibly provide a surrogate, but we are planning from our phase two study of the vaccines to also have human event rates. So it's more of.

Having a really comprehensive approach.

Green confidence and accelerate the potential approval or emergency use of these it's not relying on just one approaches multiple approaches that we bring it together in close dialogues with the highest level of regulators.

Albert Bourla: Yeah, thank you very much. I mean, it's such a transformative area treating these boys. We have now treated 11 patients, as you will learn more at the conference, 8 of them at a high dose.

Right. Thank you Michael operator, we have time for one more question. So if we can move to our last question. Please.

Your final question comes from the line of Carter <unk> from Barclays.

Great. Thanks, Thanks for fitting me in I guess, just one on.

Michael Dolsten: and we continue to see very consistent data on efficacy, looking at the dystrophin expression, and the distribution of the dystrophin. And, you know, as we have treated more patients, and the early boys that were treated, we now have a longer observation period, we can also see that durability seems to, you know, exceed 12 months when it comes to gene expression, which makes us feel very good that this could be a long durability for these boys. And we also have data coming out on muscle health, creatine kinase, and more recently MRI that allow us again to add another level of confidence that we're changing the health of the muscles. And finally, for the motor function where you use a clinical scale.

Sort of your view on the O U S pricing dynamics coming out of covert just a your expectations on the central likelihood of incremental pricing pressure from government funded health care systems, given likely pressure on E budget and is the expectation we see similar austerity measures like we saw last decade. Thank you.

Yeah. So I think I think it's very difficult to predict and be in any case, I think or assumptions. He sees the pricing is not the growth driver or pricing gaze volume is going to be our broke driver or even without called me, but I think there. If you if I had to speak on a high level on a on called with right No I think.

Welcome to short term Buck on the long term as you are asking I see two dynamics here. One is the one that you mentioned, which is likely governments.

We'll have let's say budgetary pressures and if we know that that's typically an area that they tried to go so about pricing will be towards the negatives, but also we see that are the bargain proposition for the pharmaceutical industry has been drastic Ali reset in the mine so for that people right now because of the purposes I mean there.

Michael Dolsten: We have now seen this across a number of treated boys. Fable data on the North Star index, and I want to point out that we've seen it across different ages because if you mainly monitor early boys for this, they do have some spontaneous improvement that could be difficult to distinguish from treatment-induced, but we have also seen it on older boys where you expect decline, but we have noted improvement instead. So, all in all, we feel that we have now accumulated a very robust data set on efficacy, and we have learned important lessons on how to mitigate risk and manage any possible safety event. Of course, we have one of the largest efforts for gene therapy manufacturing that has been expanding in North Carolina, and that will all come together now in our plans to start phase three trials in just a few months. So thank you for your interest.

Right now in the middle of this crisis represent the hope of the billions of people and the hundreds of millions of enterprises that we'll find their solution towards the ups and I think that we will work on the very positive sign.

So remains to be seen what will be the net tonight, although still areas, but I believe.

In any case, it's not going to drive growth by pricing is going to be available.

So I guess this is the end buffer and taking pretty much movies question really appreciate so I think this is the end its RK. Let me just yeah. Thanks, all for joining us today.

For your continued interest in engagement within five years or we are very happy to provide information and make sure everybody happy to learn thank you.

As I said that the start this is an extremely difficult tying for everyone is actually this both a great pretty billets and agree with responsibility for our colleagues to serve basins at this moment.

Michael Dolsten: Thank you Michael, really very exciting news for these boys, particularly that they have virtually no solutions right now. Angela, what about our views on what the recommendations of ACIP should be on the adult pneumococcal vaccine, the 2MD, and competition?

We have an opportunity demonstrated the power of our science and do we do everything we can.

You can be part of the solution for this problem.

I want to close by acknowledging that Frank I want to actually on the trunk lines, which they like I said string bean and inspiration to all of us.

Angela Hwang: Yes. So, you know, we're really excited about our PCV20 program and specifically about the breadth of serotype coverage that PCV20 provides. And we really see the benefits in two ways. One, first of all, these incremental serotypes are associated with high case fatality rates, antibiotic resistance, and or meningitis. So, you know, these are sort of serious diseases that these serotypes will be able to cover. But also, relative to PCV15, PCV20 is expected to provide 33% more coverage against IPD strains in adults.

Towards their dedication and expertise and save Congress lives right now and well probably in the future even more and then be talking four or five your colleagues and their families I say thank you.

So have a great Russ and good day.

Ladies and gentlemen, this does conclude sizes first quarter 2020 earnings conference call you may now disconnect.

Angela Hwang: So, with these data, our plan is to bring this forward to the CDC and to our regulatory authorities. We will certainly be discussing recommendations and what all this means. But I think, in the end, we all know that this is a decision that the CDC needs to make. And we will be, you know, having these conversations with them as our program develops. But certainly, we feel very strongly about the potential benefits and the additional coverage that PCV20 can provide. And, you know, we'll keep you posted on what happens with the CDC. Thank you.

Albert Bourla: Thank you, Adriel. And, John, do you have to add any comments on our go-forward strategy, given that you are managing this area very successfully right now, and particularly on the M&A targets or licensing targets that we have?

John Young: As you all know, but I think Albert really hit on the main point in his answer, which is that we feel really good about the prospects for the continued growth of our core business. In terms of business development to strengthen that, our focus is absolutely on clinical stage assets.

John Young: I think Frank touched on this in his answer to capital allocation earlier. So, you know, we're going to be focused on areas, including oncology, where there could be interesting tuck-ins, we're going to be looking at rare diseases. There's a lot of innovation taking place there. And I think we're uniquely placed because of the capabilities and manufacturing and development that Michael's touched on to add to our pipeline. And we continue to look across, you know, our other areas, as well as select opportunities. So, you know, we think there are opportunities out there, and we'll continue to be very active in this space. But of course, we're always going to make sure that we're disciplined, and we deploy capital in a way that really optimizes value for our shareholders, but most importantly, for our patients. So I think between Albert's and Frank's answers, hopefully that gives you a flavor of how we feel about capital deployment and business development as part of our business strategy following this effort.

Albert Bourla: Thank you very much, and I'm not sure if we also answered the question on DMD about magnesium.

Albert Bourla: [inaudible] So, Chuck, let's go to the next question.

Operator: Yes, please, let's move to the next operator. Thank you. I have a few questions. First, on abracitinib. I believe only the higher dose was better than duprexant, but there were safety issues at that dose, and it was not superior on itch. It seems the outlook is not all that positive. You obviously think differently, so could you explain? Secondly, you spoke about the PALIS trial, but to clarify the Penelope B neoadjuvant trial, did you say the readout is now Q1 of 21? We had thought it was likely to be a top line this year. And then lastly, can you just quantify the Eliquis stocking in the quarter? Thank you.

Albert Bourla: Thank you very much. I will very quickly answer the Penelope. No, the Penelope is expected to come in the second half of this year. The Pallas is expected to come early next year. This is exactly as we have said it before. Michael, why are you excited about Abracitinib?

Michael Dolsten: Yeah, you know, we are very excited about abracitinib and let me just punctuate a few things. In the Jade Compare Study, we showed that both high and medium doses met co-primer endpoint in very effectively reducing, eczema, we had a key secondary end point of comparing it to the PIXEN standard of care, and this is one of the most patient-centric endpoint impacting quality of life at both day and night time, and at the high dose statistically significantly showed better effect clinically meaningful than the PIXIM, while the lower dose, the 100 milligram numerically was better but didn't reach statistical significance.

[music].

Michael Dolsten: You know, overall, what we see is a more rapid onset with our paural abracitinib than the biological depiction. And we see a more rapid onset numerically, whether you look at skin clearance or whether you look at it, and while there are some more infections, all always with higher doses of yak inhibitors, we think, and I believe that the benefit versus the risk is still very favorable. These are mild to moderate cases; most attenuate, basically all attenuate if you discontinue treatment. And I want to finally emphasize that we have a very exciting additional trial that is not necessary for filing.

Michael Dolsten: But it's coming later this year, the trial regimen that will study whether you start on the 200 milligrams, which we know will clear skin with usage much faster than standard of care, and then you can switch in maintenance to the 100 milligrams, which, you know, likely have a lower level of adverse events, including infections. That gives you potentially maximum flexibility to treat and clean up, itch, and spin, and go on a lower dose. But again, the benefit-risk profile, to me, looks very favorable also for the higher dose. These infections are relatively rare; they're mild to moderate and can easily be managed and are, you know, quite common for a patient treated by a dermatologist. So I feel very good about the high dose being superior and the lower dose being somewhat similar to the PIXEN still having faster onset of action numerically and is parallel and very convenient to take. I hope that gave you a good sense of why I feel encouraged to see these new treatment options for patients moving into regulatory discussions and, hopefully, soon available. Thank you.

Michael Dolsten: Thank you, Michael. And Angela, what about the inventory levels? Can you explain Eliquis?

Angela Hwang: Yes, in terms of just the Eloquis impact, what we saw was an uptick in terms of inventory levels to, you know, prepare for the pandemic, and the impact was about, you know, in the mid-single digits in terms of worldwide revenue.

Operator: Great, thank you. We have time for a couple more questions. Operator, can we move to the next one? Our next question comes from the line of Andrew Baum from, Thank you. I know that you've added a couple of very distinguished scientists to the board. You've also added a former FDA Commissioner, Andrew Yotania Albert, as well as the Mylon transaction. Should we think about this as an accelerated evolution of Pfizer in terms of trying to improve the ROI that it has historically had on R&D? And if so, aside from the measures that I outlined, could you highlight any other internal organization or talent enrichment that's gone on that also points in that direction? And then, second to Michael, Pfizer seems to have pivoted away from immuno-oncology, as many others have done, given the disappointment post-PD-1. But if we do see the emergence of novel bio-targets such as TTIP and there's some others out there with a randomized phase 2 trial, should I assume that Pfizer is willing to re-engage in that field? I know I'm exaggerating in terms of binary, but it does seem that you have pivoted back towards small molecules.

Albert Bourla: Then, finally, would you comment on the anticipated treatment duration in the real-world setting for PALUS, given the issues with adverse events as well as reimbursement friction for Medicare?

Albert Bourla: Andrew, can you repeat the first part of your question, the ROI?

Albert Bourla: Yeah, so I was basically saying that under your tenure, Albert, there's been a notable addition of three individuals with high scientific calibers. So obviously, the former FDA commissioner, but also two very distinguished scientists, as well as de-complexifying the organization through the Upjohn transaction. So when I think about the evolution of the business under Pfizer, it does seem there's a concerted attempt to try and shine more light or improve the ROI through some of these measures. So I was asking, are there any other internal measures, talent enrichment inside the organization, or new R&D structures designed to improve R&D, either through accelerating programs, killing early, the normal stuff? But is something changed in the profile of improving ROI and R&D? I got it now.

Albert Bourla: And the answer is absolutely yes. It's not by chance that right now on our board we have five top scientists. Four of them are physicians, top scientists, but they have unique expertise either in regulatory science, they have unique expertise in development, they have unique expertise in basic science, both in primary care and metabolic diseases and immunology. We have also, Susan Hockfield; she was the pioneer of bringing together genomics data with computation power. She was the first biologist and the first woman to be head of MIT.

Albert Bourla: And this is a very clear statement that Pfizer is different. Pfizer is a science-based company, and this is where the growth is coming, and we are adding those board members to provide more visibility but also because they help us with their very high knowledge. Now there is not one or two; there are multiple measures that we are using to assess if indeed our R&D machine is a new machine and if we can count on it in this new strategy, and they are all pointing in this direction.

Albert Bourla: I think we've made very clear that the Pfizer of the past, because you ask a question about how if you can kill quickly and if you can, let's say, progress things that they really matter rather than move everything. Pfizer of the past had a success rate of phase 2 studies of 15% when I said it a few years ago. 15% when the industry was at third. Today, Pfizer's success rate is close to 50%, 5-0, and that's on a rolling for years. I'm sure next year we'll be enrolling 50% more students, and this is not the only one.

Albert Bourla: In 2018, we were the company that introduced the most new molecular entities of anybody else who would expect that from Pfizer, and it can go on and on. John Young has a very detailed list of criteria, and he's managing the governing process that is making sure that as we allocate capital, we allocate with RMDRI in mind. And also, I will add that the speed with which the company is reacting has nothing to do with the company of the past. And, by the way, this is very well indicated in the way that we were able to move faster than any biotech in the speed of developing a vaccine or in the speed of developing an antiviral. And the reason why we have been able to accomplish this speed, in addition to being cultural, is that we can break the company into five distinct business units, plus one, excuse me, six, together with the hospitals.

Albert Bourla: And that each one of these business units, for example, oncology, vaccines, rare diseases, they operate like a biotech. They make decisions end-to-end, from commercial to early R&D, within this structure, like if I said, if they were a biotech company, and they are presenting their requests for finance to the... Committee that John Yang is managing so that you can allocate the funds. And last but not least, although Pfizer is laser focused on this and ROE of R&D as we are progressing, it was absolutely, to avoid misunderstanding, The only criteria that we used as we jumped into the COVID-19 projects was if we could have a solution, if we could make a difference, if we think that our technology is a good one so that we can bring a vaccine or an antiviral. Because this is not the time that the ROI should prevail for COVID-19, it is times when a solution should be found. So with that, I hope I gave you some color on how Pfizer is changing and what the meaning, which is more than symbolic, of appointing the new board members is. And I will go to Michael to answer your second question.

Albert Bourla: Thank you for that question. You know, we think one needs to be careful and not throw everything under the kitchen sink into immune oncology. So we really try to cherry-pick the areas where we have learned after the initial positioning of PDXs. One example is bifunctional antibodies. We have a dose escalation of a BCMA bifunctional that looks very encouraging with a unique profile. We have full-on PD-1 bifunctional with cytokines that can boost immune resistance, and we have oncolytic viruses. You know, we were successful combining Enlyta with PDX, and we're building on that experience to now move from our bolder unit, former Ray, a small molecule this year that we think is an immune enhancer for cancer, an Axelmer inhibitor. So I hope you got that answer that we are cherry-picking the areas where we think we can break resistance to IO, rather than just throwing everything at this area.

Michael Dolsten: Thank you very much for your questions, Andrew. So, Chuck, are you asking?

Operator: Yes, let's try to get a couple more in. Operator, next question, please. Great, thanks for taking my question. So, one, maybe following up on the adverse event question from before, Steve's question. So, Michael, I definitely get the enthusiasm you have on the efficacy side and the convenience side. I guess my question is just more on safety.

Michael Dolsten: Now that you've seen the compared data, and as you think about the filing, just your level of confidence in the label being clean from some of the black box warnings we see for the current JAXA in terms of infections, malignancies, but obviously also VTEs. I think in talking to dermatologists, I feel like it would be critical for it to not have a black box in order to compete with a product like Duplexin. So, maybe you can share your views there.

Michael Dolsten: And then the second one also on the immunology pipeline, your JAK3, the 1600, just curious about the timing of that. I think the clinical trial says that the trial's expected to read out phase two, phase three, is expected in September of this year, but it also says it's still recruiting patients. So, just trying to get a better sense of when you might see data for that product. I know it has breakthrough status.

Michael Dolsten: Thank you. Thank you very much. Michael, jump immediately.

Michael Dolsten: Yeah, you know, we have a large database. I feel very good about its profile. We have not seen any, you know, cardiovascular issues. And that's really what is worrying about safety, while we see, as expected, some viral skin infections.

Michael Dolsten: I consider them more of, you know, safety tolerability and are very mild and moderate and can be well managed with standard experience in medical practice. I cannot speculate about Black Fork; that's really for regulators.

Michael Dolsten: Our JAK3 in alopecia has a very unique profile, the most selective of all JAKs that I've seen this far. We think readout will probably be, as we have predicted, mid-21. And this is a pivotal study that could go quickly to filing. We do have, at the end of this year, a number of JAK-inhibitor readouts in phase 2, like JAK3 in vitiligo. We have oral TIK2 in psoriasis and topical TIK2 in atopic dermatitis. So we'll keep you busy with a flow of news. Thank you.

Michael Dolsten: Thank you, Michael. Operator, can we get another question, please?

Operator: and Jacob from UBS.

Operator: Hi, thanks so much, Nadim from Euboea. Thanks for fitting me in.

Michael Dolsten: Michael, I just wanted to touch upon the commentary with regard to the regulators allowing surrogate markers for the SARS-CoV-2 vaccine. I just want to dig into that a little bit more. What specifically will they be looking for that allows

Operator: Speedy Approval, and then I want to understand the manufacturing...

Operator: Targeting targets that you have by year-end if approved.

Operator: If approved, I just want to understand is it I'm assuming it's going to be under a sort of expanded

Operator: Access Use Basis for Healthcare Workers, and then what do you need from regulators for broad approval for the general public? Any kind of clarity around that would be helpful.

Albert Bourla: Yes, I do not know how the regulators would like to regulate that, so I leave it to them. But I can answer the question about manufacturing. So we expect that we will have, in the last quarter of this year, millions of doses basically ready. And then in 2021, we could ramp up to hundreds of millions of doses available. Now, Michael, maybe a little bit, you can answer the question about the endpoints or the surrogate endpoints.

Michael Dolsten: And there are, of course, the interests of both regulators and pharmas to see how we can learn maximally to allow potentially very important vaccines quickly to deal with this both medical and business crisis. So we have had ample discussions with the highest level of regulatory leaders in both US and Europe, and data, and we are pursuing mice slash hamsters as well as primate studies that are ongoing and will hopefully show us what level of immune activity interferes with the virus. And we're also doing some, I think, really creative studies, taking patients' sera and testing them, how they can intervene in these models and trying to correlate convalescent patient transfusions and what levels protect the deceased or, you know, can halt the progression of disease in patients.

Michael Dolsten: So I think this is a unique area where we will have human and animal data coming together in Q3 to possibly provide a surrogate. But we are planning from our phase two study of the vaccines to also have human event rates. So it's more of having a really comprehensive approach to bring confidence and accelerate the potential approval or emergency use of this. It's not relying on just one approach. It's multiple approaches that we bring together in close dialogues with the highest level of regulators.

Michael Dolsten: Right. Thank you, Michael. Operator, we have time for one more question. So if we can move to our last question, please. Great. Thanks. Thanks for fitting me in.

Albert Bourla: I guess just one on sort of your view on the OUS pricing dynamics coming out of COVID. Just your expectations on the potential likelihood of incremental pricing pressure from government funded healthcare systems given the likely pressure on EU budgets. And is your expectation that we will see similar austerity measures like we saw last decade?

Albert Bourla: Yeah, so I think it's very difficult to predict. And in any case, I think our assumptions are that pricing is not the growth driver. Pricing and volume is going to be our growth driver, even without COVID. But I think if I had to speak on a high level about COVID right now, I think, and not in the short term, but in the long term, as you are asking, I see two dynamics here. One is the one that you mentioned, which is likely to happen because governments will have, let's say, budgetary pressures.

Albert Bourla: And we know that that's typically an area that they try to go. So that, I think, will be towards the negatives. But also, we see that the value proposition of the pharmaceutical industry has been drastically reset in the minds of the people right now because the pharmaceutical industry, right now, in the middle of this crisis, represents the hope of billions of people and hundreds of millions of enterprises that we will find a solution to that. And I think that will work very positively. So, it remains to be seen what the net-net of those two areas will be, but I believe that, in any case, it's not going to drive growth through pricing; it's going to be by volume.

Albert Bourla: So I guess this is the end of... And thank you very much for this question, really. So, let me just thank you all for joining us today, for your continued interest and engagement within Pfizer. We are very happy to provide information and are also very happy to learn from you. As I said at the start, this is an extremely difficult time for everyone. As such, it is both a great privilege and a great responsibility for our colleagues to serve patients at this time. We have an opportunity to demonstrate the power of our science, and we will do everything we can to be a part of the solution to this problem.

Albert Bourla: And I want to close by acknowledging the healthcare workers on the frontlines whose heroic efforts have been an inspiration to all of us. Their courage, their dedication, and expertise have saved countless lives right now and probably in the future, even more. And on behalf of all Pfizer colleagues and their families, I say thank you. So, have a great rest of your day.

Operator: Ladies and gentlemen, this does conclude Pfizer's first quarter 2020 earnings conference call. You may now disconnect.