Q2 2021 Pfizer Inc Earnings Call

Good day, everyone and welcome to Pfizer's second quarter 2021 earnings conference call today's call is being.

Operator: Good day everyone, and welcome to Pfizer's 2nd Quarter 2021 Earnings Conference Call. Today's call is being recorded. At this time, I would like to turn the call over to Mr. Chris Stivo, Senior Vice President and Chief Investment Relations Officer. Please go ahead, sir.

Reported.

At this time I would like to turn the call over to Mr. Chris <unk> Senior Vice President and Chief Investment Relations Officer. Please go ahead Sir.

Okay.

Christopher Stevo: Thank you, Sylvia. Good morning.

Thank you Sylvia.

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Christopher Stevo: It's my pleasure to be welcoming you to Pfizer's second quarter earnings call for the first time as the head of investor relations at Pfizer. I'm joined today by Dr. Albert Bourla, our Chairman and CEO.

It's my pleasure to be welcoming you to Pfizer's second quarter earnings call for the first time.

Record of Investor Relations at Pfizer.

And today by Dr. Albert boiler, our chairman and CEO.

Christopher Stevo: Frank D'Amelio, our CFO, Michael Dolsten, President of Worldwide Research and Development, and Medical Angela Huang, Group President, Pfizer Biopharmaceuticals Group; John Young, our Chief Business Officer

Damelio our CFO.

Michael dose then president of worldwide research and development in medical.

Angela Hwang group President of Pfizer Biopharmaceuticals group.

John Young our chief business.

Christopher Stevo: and Doug Lankler, General Counsel. We will begin the call with remarks from Albert, followed by a pipeline update from Michael. Frank will then give you his thoughts on the numbers and our update guide before we open up the call for Q&A. Finally, Albert will come back for concluding comments. We expect this call to last 90 minutes. The materials for this call, as well as all the other earnings-related materials, have been posted to the investor relations website.

The head of Sir.

Doug length of General Counsel.

We will begin the call with remarks by Albert followed by a pipeline update for Michael.

And Frank will then give you his thoughts on the numbers and our updated guidance before we open up the call for Q&A.

Finally, Albert will come back for concluding comments, we expect this called the last.

Last 90 minutes the.

Of the materials for this call as well as all of the other earnings related materials have been posted to the Investor Relations section of Pfizer Dot com.

Christopher Stevo: [inaudible] As you can see on slide three.

As you can see on slide 3 we will be making forward looking statements during the call regarding amongst other topics, our anticipated future operating and financial performance.

Christopher Stevo: We will be making forward-looking statements during the call regarding, amongst other things, our anticipated future operating and financial performance, business plans and prospects, and expectations for our product pipeline and marketability.

<unk> business plans and prospects and expectations for our product pipeline and marketed products, which are subject to risks and uncertainties as well as the use of non-GAAP financial information.

Christopher Stevo: which are subject to risks and uncertainties as well as the use of non-GAAP financial information. Additional information regarding forward-looking statements and our non-GAAP financial measures is available in our earnings release, including under the Disclosure Notice section and under Risk Factors in our SEC Forms 10-K and 10-Q. Forward-looking statements on the call speak only as of the call's original date.

Additional information regarding forward looking statements and our non-GAAP financial measures is available in our earnings release, including hundreds.

Closure notice section.

And under risk factors in our SEC forms 10-K, and 10-Q forward looking statements on the call speak only as of the calls original base.

And we undertake no obligation to update or revise any of the statements with that I will turn over the call to Dr. Boiler Albert. Please go ahead.

Albert Bourla: and we undertake no obligation to update or revise any of this paper. With that, I will turn over the call to Dr. Borla. Albert, please go ahead.

Albert Bourla: Thank you, Chris, and I think there was a problem with your line at the last second, so you can have a look at that. Welcome to your first Pfizer earnings call as our new Chief Investor Relations Officer. Hello, everyone. I'm proud to say that Pfizer delivered an outstanding second quarter. Most notably... We delivered extremely strong financial results, even excluding direct sales and alliance revenue provided by our COVID-19 vaccine. We generated 10% operational revenue growth compared to the prior year quarter.

The system.

Thank you, Chris and I think there was a problem with your alignment of the elastic.

Welcome to your first the size of our earnings call at all.

Our new Chief Investor Relations.

Relations Officer, Hello, everyone I'm proud to say the Pfizer delivered an outstanding second quarter.

Thanks.

Most of the Norfolk.

We delivered extremely strong financial results, even excluding direct lines.

Even excluding direct sales on alliance revenue provided by our COVID-19 vaccine.

We've done the right, 10% of operational revenue growth compared to the prior year quarter.

Albert Bourla: And I would note that the year-ago quarter was also very strong, delivering 6% operational growth for the comparable business. At the same time, we continue to accelerate the production and delivery of the Pfizer-BioNTech COVID-19 vaccine and, in collaboration with BioNTech, have now shipped more than 1 billion doses since last December. This is truly remarkable, especially when you consider that prior to the pandemic, Pfizer produced approximately 200 million doses annually across our entire vaccines portfolio. Let me start with a commentary on some of our biggest growth drivers in the world.

I would know the the year ago quarter was also very strong delivering 6% of operational growth from the comparable business.

At the same time, we continue to accelerate the production and delivery of the Pfizer Pfizer with the COVID-19 vaccine.

And in collaboration with biotech have now shipped more than 1 billion doses since.

And the zone.

This is truly a remarkable especially when you consider the prior to the pandemic Pfizer produced approximately 200 million doses annually across our entire.

Portfolio.

Let me start with the commentary on some of our biggest growth drivers in the quarter.

The Pfizer bind with the COVID-19.

Albert Bourla: The Pfizer-BioNTech COVID-19 vaccine contributed $7.8 billion in global revenues during the second quarter, and we continue to sign agreements with governments around the world. Just last week, we announced that the U.S. government had purchased an additional 200 million doses of the vaccine, bringing the total number of doses to be supplied to the U.S. government under its existing supply agreement to 500 million. This is in addition to the 500 million doses that we agreed to provide to the U.S. government as a non-for-profit prize to be donated to the poorest countries in the world.

The new vaccine contributed $7.8 billion in global revenues during the second quarter, and we continue to sign agreements with governments around the world.

Just last week, we announced that the U S. Government has purchased an additional 200 million doses of the vaccine, bringing the total number of doses to be supplies of the U S government under.

So as existing supply agreement and $500 million.

This is in addition to the 500 million doses that we agreed to provide to the.

The U S government and non for profit products will be donated to the poorest Congress in the world.

We anticipate but the significant amount of the remaining 2000.

Albert Bourla: We anticipate that a significant amount of the remaining 2021 vaccine manufacturing capacity will be delivered to middle and low-income countries where prices will be in line with income levels or at a non-profit price. In fact, we are on track to deliver on our commitment to provide more than $1 billion, more than 1 billion doses, or approximately 40% of our total production to middle and low-income countries this year and another 1 billion in 2022. Vintago and Vintamax revenues were up 77% operationally to 501 million globally.

<unk>, 1 vaccine manufacturing capacity will be delivered to middle and low income countries, where we price in line with income levels.

The non for profit price.

We are on track to deliver on our commitment to provide this year more of them $1 billion.

More than 1 billion.

Or approximately 40% of our total production to middle and low income countries and another $1 billion in 2022.

Vindical and the winter amongst the revenues were up 77% of personnel to 501 million globally.

All disease educational efforts.

Albert Bourla: Our disease educational efforts in the U.S. continue to support increases in appropriate diagnosis. While the main driver of growth in Japan has been the successful establishment of several referral networks in select areas resulting in new patient stops, we anticipate these efforts will continue to support a strong trajectory for France. Eliquis continued its strong performance with revenues up 13% operationally to $1.5 billion.

The U S continue to support the increases in the appropriate diagnosis.

The main driver of growth in Japan has been the success of establishment of <unk>.

The referral networks and select areas, resulting in new patient starts.

We anticipate these efforts will continue to support the strong sort of exact story.

<unk> for the franchise.

<unk> continued its strong performance with revenues up 13% of our estimate of $1.5 billion.

Albert Bourla: This was led by growth in the U.S. and emerging markets, driven primarily by the strength of the clinical profile, ease of use for both patients and clinicians, continued increased adoption in non-valvular atrial fibrillation, and overall oral anticoagulant market surge gain. Prevnar 13 in the U.S. was up 34% overall to 642 million. This growth was due primarily to higher levels of healthcare activity and wellness visits compared with the prior year quarter, which was heavily impacted by COVID-19-related mobility restrictions and limitations. Growth in the pediatric indication was also due to year-over-year government purchasing patterns, and those were partially offset by lower year-over-year birth rates.

This was led by growth in the U S and emerging markets driven primarily by strength of the clinical profile.

Ease of use for both.

Interest and clinicians continued increased adoption in non valvular atrial fibrillation and overall oral anticoagulant market share gains.

Revenue sort of thing in the U S was up 34% of Earl.

$642 million this growth was due.

The base merrily to higher levels of health care activity in the wellness visits compared with the prior year, GAAP, which was heavily impacted by COVID-19 related mobility restrictions and limitations.

Growth in the pediatric indication was also due to year over year government purchasing patents.

Price, partially offset by lower year over year of birth rates.

Albert Bourla: Growth in the adult indication was partially offset by the continued impact of the lower remaining eligible unvaccinated population. During the quarter, the U.S. Food and Drug Administration approved Prevnar 20 for adults ages 18 and over for the prevention of both invasive disease and pneumonia caused by the 20 pneumococcal serotypes in the vaccine. I would note that a 15-valent vaccine also recently received FDA approval in adults. However, that approval did not include the pneumonia indication.

Growth in the adult indication was partially offset by the continued impact of the lower remaining eligible unvaccinated population.

During the quarter the U S food and drug administration.

Group revenue.

Angelus Wendy for adults ages 18 and over.

Of the prevention of both the.

The invasive disease and pneumonia caused by the twin of the pneumococcal serotypes and of the vaccine.

No, but as we've seen volume vaccine all sort of since we received FDA approval. It no doubt however that the.

Our deep did not include the pneumonia indication.

We believe the only way to add that indications of the 15 valent vaccine in the U S will be to conduct the post licensure of efficacy effectiveness trial, which we believe means the for the foreseeable future, but I'm not the likelihood the only vaccine within.

Albert Bourla: We believe the only way to add that indication to the 15-valent vaccine in the U.S. would be to conduct a post-licensure efficacy effectiveness trial, which we believe means that for the foreseeable future, Prevnar-20 likely will be the only vaccine with an indication against vaccine-type pneumonia for the 20 serotype. For Ibrance, we continue to be pleased with double-digit growth in international markets and are encouraged by signs of recovery in several key markets.

An indication against vaccine type of pneumonia for the 20th superpowers.

For <unk>, we continue to be pleased by the double digit growth in international markets and are encouraged by signs of recovery of recovery in several key markets in the U S. <unk> continues.

Albert Bourla: In the U.S., Ibrance continues to be the leading CDK4-6 inhibitor, with 83% total patient share and 73% share of first-line metastatic new patient starts. While total prescription volume was stable in the second quarter, paid demand for Ibrance was down due to increased enrollment in our patient assistance program, which we referenced last work. This resulted in a second quarter revenue decline in the U.S. of 7% compared with the year ago quarter.

To be the leading CDK 4.6 inhibitor with 83% top of patient share and 73% share of <unk>.

First line with the static new patient starts.

While total prescription volume was stable in the second quarter pace of demand for Ibrutinib was down due to increase the.

Enrollment in our patient assistant program.

Which we referenced last quarter.

This resulted in the second quarter revenue decline in the U S of 7% compared with a year ago quarter.

In light of global revenues were up 29% of arresting the 257.

Albert Bourla: In litus, global revenues were up 29% operationally to $257 million, primarily reflecting increased adoption in the US and developed Europe of combinations of certain immune checkpoint inhibitors and in litus. Xtandi sales in the U.S. were up 14% to $303 million, driven by strong demand across all approved indications. Our global biosimilars revenue grew 88% operationally to $559 million, driven by several recent oncology biosimilar launches. As you can see, biosimilars have become a meaningful part of our business while delivering lower-cost patient care options that can help reduce overall healthcare spending levels.

$7 million, primarily reflecting increased adoption in the U S. In developed Europe of combinations of immune checkpoint inhibitors and in life.

Expanding the U S was up 14% the 303 million driven by strong demand across all approved indications.

Our global Biosimilars revenue grew 18.

<unk> 88 per cent of operation with 559 million driven by several recent oncology biosimilar launches as you can see by the stimulus could become a meaningful part of our business, while delivering lower cost of patient care options that can help reduce overall health care spending of it.

Now.

Let me share 2 brief updates from our JAK inhibitor portfolio.

We continue to remain confident in the importance of a JAK inhibitor class for appropriate patients with inflammatory diseases, given they're all of that off of waste in inflammatory process.

In addition, we have taken a targeted approach to developing.

If I can keep hitters based upon our extensive knowledge of JAK biology, coupled with our medical chemistry capabilities.

Albert Bourla: Now, let me share two brief updates from our JAK inhibitor portfolio. We continue to remain confident in the importance of the JAK inhibitor class for appropriate patients with inflammatory diseases given the role of JAK pathways in inflammatory processes. In addition, we have taken a targeted approach to developing selective JAK inhibitors based upon our extensive knowledge of JAK biology, coupled with our medical chemistry capabilities, which suggest the best target for a specific indicator.

Suggest the best targets for a specific indication.

We believe this approach may optimize the benefit risk profile.

Of course patient safety ease of all.

So all the importance and we continue to monitor all compounds in our portfolio to identify signals both in development as well as after regulatory approval.

Global sales of <unk> revenue were down 9% of impression of in the quarter to $286 million driven primarily by of 15%.

All of mine in the U S.

While prescription volume volume increased 2% leased the revenue decline reflects an unfavorable change in channel mix toward lower priced channels and continued investments to improve formulary positioning and unlock access to additional patients.

Albert Bourla: We believe this approach may optimize the benefit-risk profile. Of course, patient safety is of utmost importance, and we continue to monitor all compounds in our portfolio to identify signals, both in development as well as after regulatory approval. Global Xeljanz revenue went down 9% operationally in the quarter to $286 million, driven primarily by a 15% decline in the US, while prescription volume increased 2%.

Also of negative impact on new patient starts of resulting from an ongoing review by the FDA of safety data from the post marketing oral survey of our study of Xeljanz in subjects with rheumatoid arthritis. We were 50 years of age of older instead of at least the 1 additional.

Cardiovascular response.

International developed markets achieved 11% of operational growth in the same quarter.

The FDA recently notified price, but it would not meet the prescription drug user fee Act.

But the <unk> goal date for the supplemental new drug.

Albert Bourla: This revenue decline reflects an unfavorable change in channel mix toward lower-priced channels and continued investments to improve formulary positioning and unlock access to additional patients' lives. There is also a negative impact on new patient starts resulting from an ongoing review by the FDA of safety data from the post-marketing oral surveillance study of Xeljanz in subjects with rheumatoid arthritis who were 50 years of age or older and had at International developed markets achieved 11% operational growth in the same quarter.

Applications for Xeljanz Xeljanz XR for the treatment of adults with octave.

Closings from the likes.

No revised the due for gold day has been set for this NDA supplementary.

Supplementary index.

The FDA also recently notified Pfizer, what he could not meet the proof of Goldman.

For the new drug application or a precedent for the treatment of adults and adolescents with moderate to severe atopic dermatitis.

EBITDA side, its ongoing review of of Pfizer's post marketing safety stock.

Oral survey of all.

The rating of our Sydney in patients with rheumatoid arthritis.

As a factor in the in the East is a factoring of the expense.

No revised the difficult because its been said by the MBA for the symbion.

Albert Bourla: The FDA recently notified Pfizer that it would not meet the Prescription Drug User Fee Act, the PDUFA goal date, for the supplemental new drug applications for Xeljanz, Xeljanz XR, for the treatment of adults with active ankylosing spondylitis. No revised PDUFA goal date has been set for this NDA. Supplementary.

Now I want to touch on the by the administrations. The recent executive order on promoting competition.

While I believe there may be better.

Youll notice that some of its policies put forward in the executive order.

Can agree that fostering competition and lowering cost per patients should be the focus of any regulatory or legislative action.

Albert Bourla: The FDA also recently notified Pfizer that it would not meet the BDUFA goal date for the new drug application for abracitinib for the treatment of adults and adolescents with moderate to severe atopic dermatitis. The FDA cited its ongoing review of Pfizer's post-marketing safety study and oral surveillance, evaluating dofacitin in patients with rheumatoid arthritis as a factor in the extent.

We continue to support more affordable options for patients like Biosimilar.

The improving the Medicare program to come out of pocket costs, and also lower cost setting for seniors.

And making insurance walk by.

By requiring the patient share in rebates savings at the pharmacy counter.

We believe this meaningful solutions.

Similar would have an immediate impact for patients without sacrificing future universe.

Overall I believe the second quarter was the clear and powerful demonstration of the capabilities of the new Pfizer.

Albert Bourla: No revision of a goal has been set for this NDA. Now I want to touch on the Biden Administration's recent executive order on promoting competition. While I believe there may be better alternatives to some of these policies put forward in the executive order.

Looking forward, we intend to build upon the successes by continuing to follow the science.

The thrust in our people and remain focused on delivering breakthroughs for the patients we serve.

Albert Bourla: We can agree that fostering competition and lowering costs for patients should be the focus of any regulatory or legislative action. We continue to support more affordable options for patients like biosimilars. Improving the Medicare program to cut out-of-pocket costs and also lower cost-sharing for seniors, and making insurance work by requiring that patients share in rebate savings at the pharmacy counter.

Thus, we continue to expect the revenue CAGR of at least 6% on the risk adjusted basis through the.

The end of 2025 and double digit growth on the bottom line.

I would note that the.

These projections do not include any potential impact from all COVID-19 vaccine.

The recent all subsequent business development activities all.

The potential future mrna programs.

We remain very confident in our ability to achieve these growth rates because of the strength of both of our current product portfolio.

And are in the pipeline at.

At the same time, we will continue to pursue business development opportunities with the potential to further enhance our long term growth for us.

Albert Bourla: We believe these meaningful solutions would have an immediate impact for patients without sacrificing future innovation. Overall, I believe the second quarter was a clear and powerful demonstration of the capabilities of the new Pfizer. Looking forward, we intend to build upon these successes by continuing to follow the science, trust in our people, and remain focused on delivering breakthroughs for the patients we serve. As such, we continue to expect a revenue cage of at least 6% on a risk-adjusted basis through the end of 2025 and double-digit growth on the bottom.

Just last week, we announced a global caliber.

Collaboration with arenas to develop and commercialize <unk>.

The 471 in the investigational oral product estrogen receptor protein integrate the.

Most of US in receptor is the well known disease driver in most of the breast cancers and we are excited to work with our remarks on the first potential product for breast cancer.

With its.

It's encouraging early clinical data has the potential to become a novel hormonal therapy backbone for HR positive breast cancer.

Now I will turn it over to Michael speak more about our R&D efforts and then of course front will provide financial details of the quarter and our outlook for the remainder.

Albert Bourla: I would note that these projections do not include any potential impact from our COVID-19 vaccine, recent or subsequent business development activities, or potential future mRNA programs. We remain very confident in our ability to achieve these growth rates because of the strength of both our current product portfolio and our R&D pipeline. At the same time, we will continue to pursue business development opportunities with the potential to further enhance our long-term growth process.

'twenty 'twenty 1.

Michael.

Thank you Albert I'm delighted to share some highlights from <unk> R&D pipeline, which continues to be 1 of our greatest strength.

Today, I will share updates on 8 select programs in which we are pursuing first in class.

Class, the breakthrough science, and which of estimate that the approvals before 'twenty thought of it and the potential to of profound impacts of millions of patients.

Albert Bourla: Just last week, we announced a global collaboration with Arvinas to develop and commercialize ARV-471, an investigational oral product, an estrogen receptor protein degrader. The estrogen receptor is the well-known disease driver in most breast cancers, and we are excited to work with Arvinas on the first potential product for breast cancer, which with its encouraging early clinical data has the potential to become a novel hormonal therapy backbone for HR-positive breast cancer Now I will turn it over to Michael to speak more about our R&D efforts, and then, of course, Frank will provide financial details on the quarter and our outlook for the remainder of 2021.

Last week, we announced the global collaboration with Abbvie and us to develop and commercialize a or b of 471 potentially the first protest.

Or put the license targeting chimera estrogen receptor protein degrader.

4 of 7.1 represents breakthrough drug design technology.

The attack protein degraders efficiently eliminate rather than inhibit the disease, causing proteins.

Our knowledge of <unk>, 7.1 which was designed to be.

Around the high potency estrogen receptor degrader with a favorable safety profile is the only E are targeting protect the greater in clinical development.

And has the distinct mechanism of action from the many starts in development.

In the future novel assets like 47.

And all of the potential to be the new endocrine therapy backbone either alone or in combination with CDK inhibitors, such as eyebrow other.

The targeted therapies and all therapies with novel mechanisms of action.

The clinical data show 471 has the potential to be in and the crime.

Michael Dolsten: Thank you, Albert. I'm delighted to share some highlights from Pfizer's R&D pipeline, which continues to be one of our greatest strengths. Today, I will share updates on eight select programs in which we are pursuing first-in-class breakthrough science and which have estimated approvals before 2030 and the potential to have profound impacts on millions of patients. Last week, we announced a global collaboration with Arbena to develop and commercialize ARV-471, potentially the first Protec or proteolysis-targeting Chimera estrogen-receptor protein degrader.

Therapy of choice across treatment settings in breast cancer.

471 is being evaluated as a treatment for metastatic breast cancer and a phase 1 dose escalation study of phase <unk> combination study with eyebrows and the phase 2 monotherapy dose expansion study starting in 2020.

2 we expect to initiate the phase 3 studies across lines of therapy in metastatic breast cancer, including in combination with eyebrows, followed by pivotal studies in the early breast cancer therapy.

Let me share some of the preclinical data that has us excited the sharp.

Of the list shows 471 demonstrated impressive antitumor activity in combination with Ibrutinib part of the cycling in preclinical studies.

Michael Dolsten: 471 represents breakthrough drug design technology; Protein degraders efficiently eliminate, rather than inhibit, disease-causing proteins. To our knowledge, 471, which was designed to be an oral, high-potency, SGN-receptive degrader with a favorable safety profile, is the only ER-targeting protect degrader in clinical development, and has a distinct mechanism of action from the MANI search in development. In the future, novel assets like 471 have the potential to be the new endocrine therapy backbone, either alone or in combination with CDK inhibitors such as Ibrance, other targeted therapies, and or therapies with novel mechanism reactions. Early clinical data show 471 has the potential to be an endocrine therapy of choice across treatment settings in breast cancer.

In the phase 1 interim analysis was 21 patients.

471 demonstrated a compelling efficacy signal.

And all in heavily pre treated patients the <unk>.

Majority would price fall, the best and treatment and all with prior of CDK 4.6 inhibition treatment.

The images on the right.

The <unk> patients on Port 7.1 monotherapy, who had a confirmed partial response after 4 cycles.

With the 51 with percentage reduction in target lesion size as indicated by the arrows 2 patients had unconfirmed partial responses and 1 patient demonstrated stable disease with more than 50% target lesion shrinkage.

Ive pads tumor biopsies demonstrated.

ER degradation up to 90% with an average of 62%.

The next program is Robert too.

Details of which we have not shared previously.

No disease specific treatment all currently available for focal segmental bloemer sclerosis.

Or if it's yes for sure.

Michael Dolsten: 471 is being evaluated as a treatment for metastatic breast cancer in a Phase 1 dose escalation study, a Phase 1b combination study with Ibrance, and a Phase 2 monotherapy dose expansion study. Starting in 2022, we expect to initiate phase three studies across lines of therapy in metastatic breast cancer, including in combination with Ibrance, followed by pivotal studies in the early breast cancer system. Let me share some of the preclinical data that has us excited. The shot on the left shows 471 demonstrated impressive anti-tumor activity in combination with Ibrance in preclinical studies.

We have developed in collaboration with Boston University in Boston Medical Center of potentially novel and first in class disease, modifying biological therapy comprising of slipped to ligand antibody FC trip that lowest activation of the robots.

Except the FTSE.

If we treat the F S, yes, as well as adjacent renal glomerule of parties.

Preliminary results for the interim analysis of our ongoing phase Iia study in adult patients with steroid resistant if the FX, yes demonstrated promising data.

We just statistically significant and clinically meaningful reduction in urine protein creatinine rates you all the UPC are we.

Michael Dolsten: In the Phase 1 Interim Analysis of 21 patients, 471 demonstrated a compelling efficacy signal in heavily pre-treated patients, the majority with prior filbuster treatment and all with prior CDK4-6 inhibition treatment. The image on the right shows one patient on 471 monotherapy who had a confirmed partial response after four cycles with a 51% reduction in target lesion size, as indicated by the arrow. Two patients had unconfirmed partial responses, and one patient demonstrated stable disease with more than 50% target lesion shrinkage. 5-pad tumor biopsies demonstrated ER degradation, up to 90% with an average of 62%. The next program is RoboTube, details of which we have not shared previously.

We are advancing the program to potentially demonstrate proof of concept in 'twenty, 2 and preparing for people to the studies.

This chart shows the change in <unk>.

2 of your a marker of renal function from baseline in the array of the treatment resistant patients in the phase Iia study there was a favorable reduction of proteinuria at 13 weeks based on data from approximately half of the price dose cohort first dose cohort of the study.

Please note of the stopping the treatment as per study protocol the youth.

PCR deteriorated, indicating the need for continuous therapy.

Treatment every 2 weeks was well tolerated with no significant safety signals to date.

Next let's turn to our.

CIP programs in hemophilia, a and B and Duchenne muscular dystrophy.

Pfizer continues to advance the broadest late stage gene therapy portfolio of potentially transformational treatment.

We expect phase 3 interim analysis for all 3.

Michael Dolsten: No disease-specific treatments are currently available for focal segmental blemish sclerosis, or FSDU, yes, for sure. We have developed, in collaboration with Boston University and Boston Medical Center, a potentially novel and first-in-class disease-modifying biological therapy comprising a SLIP2 ligand antibody ST trap that lowers activation of the RoboQ receptor for treating FSDS, as well as adjacent renal glomerulopathy. Preliminary results from interim analysis of our ongoing PACE2A study in adult patients with steroid-resistant FSGS demonstrated promising data with a statistically significant and clinically meaningful reduction in urine protein to creatinine ratio, or UPCR.

<unk> strength in 'twenty 2.

In the phase 1.2 hemophilia a study we have seen durable expression of factor 8.

So it was 78 weeks with an annual bleed rate in the past 52 weeks of zero.

In the phase 1.2 hemophilia B study.

We have seen sustained expression of X the 9 activity into year 4 of the phase 1.2 long term for lot of study with an annual bleed the rate of less than 1.

In the phase 1 b Duchenne muscular dystrophy started statistically significant expression of mainly it is true.

The probe and the 3.5 point increase in the North Star Ambulatory assessment score have been observed.

Now, we'll turn to our Lyme disease vaccine the only active line vaccine candidate in clinical development today being co developed with the Bolivar.

Michael Dolsten: We are advancing the program to potentially demonstrate proof-of-concept in 22 and preparing for pivotal studies. This chart shows the change in UPCR, a marker of renal function, from baseline in steroid-treatment-resistant patients in the Phase IIa study.

The ongoing phase 2 study.

Free and which completed the recruitment of adult and pediatric participants last week.

We will evaluate the optimal vaccination schedule for use in phase III.

We expect potential proof of concept in January of 'twenty, 2 and the phase III study in the first of all from 'twenty 2.

This chart shows.

The more than 90% of subjects zero converted to all seek serotypes, we'd have 3 dose vaccination schedule at zero, 2 and 6 months in the phase <unk> study demonstrating a favorable immune response.

Michael Dolsten: There was a favorable reduction in proteinuria at 13 weeks based on data from approximately half of the first dose cohort of the study. However, please note that after stopping the treatment as per study protocol, UPCR deteriorated, indicating the need for continuous therapy. Treatment every two weeks was well tolerated with no significant safety signals to date. Next, we turn to our gene therapy programs in hemophilia A and B and Duchenne muscular dystrophy. Pfizer continues to advance the broadest late-stage gene therapy portfolio of potentially transformational treatments.

Our respiratory syncytial virus vaccine.

The most advanced bivalent protein based vaccine with phase II data published showing high neutralization titers against both or if the a and b subtypes, which has not been demonstrated in clinical development by our monovalent free future ethics Ian.

We.

We have been advancing this asset for both adults through direct vaccination and in the fence through maternal immunization today I will focus on adults.

In 2020, we initiated a phase Iia study is to evaluate the safety immunogenicity and efficacy of the recombinant RSV.

Michael Dolsten: We expect Phase 3 interim analysis for all three programs in 2022. In a Phase I-II Haemophilia A study, we have seen durable expression of Factor VIII through 78 weeks with an annual bleed rate in the first 52 weeks of zero.

Is the free fusion vaccine in the virus challenge model in healthy adults 18 to 50 years of age I won't show you David on the next slide which we plan to submit for peer reviewed publication soon.

Michael Dolsten: We have seen sustained expression of Hector 9 activity into year 4 of the Phase 1-2 long-term follow-up study with an annual bleed rate of less than 1, and in a Phase 1b Duchenne muscular dystrophy study, statistically significant expression of mini dystrophin, and a 3.5 point increase in the North Star ambulatory assessment score have been observed. Now we'll turn to our Lyme disease vaccine, the only active Lyme vaccine candidate in clinical development today being co-developed with Valneva.

Results from our Phase II Challenge study of 62 subjects showed the vaccine.

<unk> was 100% effective against mild to moderates in domestic inflection and most participants in the study experienced minimal to no side effects.

That's the performance benchmark. The 80.26 RSV F vaccine showed 52 per cent observed efficacy.

You can see in the same human challenge model.

In the slide we show of various payable protective changes of the vaccine on viral load left side and in reducing drastically RSV disease severity right side.

Michael Dolsten: The ongoing Phase 2 study, which completed recruitment of adult and pediatric participants last week, will evaluate the optimal vaccination schedule for use in Phase 3. We expect potential proof of concept in January 2022 and a phase 3 study in the first half of 2022.

Based on the is overwhelmingly positive data.

We will accelerate the development of our RSV F vaccine in adults.

We plan to initiate the global phase III trial in the third quarter.

And hope to conclude the study swiftly in part due to the recent spike in RSV infection reported by CVC.

Michael Dolsten: This chart shows that more than 90% of subjects seroconverted to all 6 serotypes with a 3-dose vaccination schedule at 0, 2, and 6 months in the Phase IIb study, demonstrating a favorable immune response. Our respiratory syncytial virus vaccine is the most advanced bivalent, Protein-Based Vaccine with Phase 2 data published showing high neutralization types against both RCA and B subtypes, which has not been demonstrated in clinical development by We have been advancing this asset for both adults through direct vaccination and infants through maternal immunization. Today, I will focus on Adam.

The twist delivery of the world's Pos mrna based vaccine made of scientific the opportunity of mrna technology clear all.

Our strategy to advance and unlock the full potential of mrna is focused in 3 core areas.

We're strengthening the core of COVID-19 vaccine.

This is charles growing in infectious disease vaccine pipeline and exploring therapeutic areas like rare disease in oncology with the strongest potential let's start with the mrna flu vaccine, which we banned began working on rebound in twin the 18th having.

Michael Dolsten: In 2020, we initiated a Phase IIa study to evaluate the safety, immunogenicity, and efficacy of the recombinant RSV prefusion vaccine in a virus challenge model in healthy adults 18 to 50 years of age. I will show you data on the next slide, which we plan to submit for peer-reviewed publication soon. Resolve, from a phase 2 shelling study of 62 subunits, the Shooter vaccine was 100% effective against mild to moderate symptomatic infection, and most participants in the study experienced minimal to no side effects. That's the performance benchmark.

Having of flu vaccine.

<unk> per much better efficacy better T cell and innate immune responses and more timely manufacture soon of the strength of known could dramatically change the trajectory of disease. We are projected to start first in human trials for a modified RNA or model RNA of flu vaccine in the third quarter.

In which the subject to regulatory approval.

Preclinical studies were performed with the first generation modified mrna tetravalent flu vaccine and the data were compared to data from a market of the flu advocacy.

The immunogenicity in mice for a first generation mud RNA flu candidates across the 20.

Of course in 19, northern hemisphere strength were higher or as high as the trivalent adjuvant. The sub unit vaccine. We are encouraged by these data and look forward to progressing this program.

Michael Dolsten: The AD26-RSV-PREF vaccine showed 52% observed efficacy in the same human challenge model. In this slide, we show very stable protective changes of the vaccine on viral load, left side, and in drastically reducing RSV disease severity, right side. Based on these overwhelmingly positive data, we will accelerate the development of our RSV vaccine in adults. We plan to initiate a global phase 3 trial in the third quarter and hope to conclude the study swiftly, in part due to the recent spike in RSV infections reported by CDC. The swift delivery of the world's first mRNA-based vaccine made the scientific opportunity of mRNA technology clear. Our strategy to advance and unlock the full potential of mRNA is focused on three core areas.

We now turn to our COVID-19 vaccine program in collaboration with by Rentech.

The Delta.

The variant, which is the most transmissible we have yet seen is expanding rapidly worldwide and now represent approximately 83% of sequence cases in the U S.

We continue to believe it's some of it is likely that the sad news booster may be needed within 6 months.

The 12 months after full vaccination to maintain the highest level of protection and studies are underway to evaluate the safety and the immunogenicity of the dose.

We are in ongoing discussion with regulatory agencies.

Broadening of potential sort of dose bluestone current vaccine.

And the assuming positive results anticipate an emergency use authorization submission S. All their orders.

Michael Dolsten: We're strengthening the core COVID-19 vaccine franchise, growing an infectious disease vaccine pipeline, and exploring therapeutic areas like rare diseases and oncology with the strongest potential. Let's start with the mRNA flu vaccine, which we began working on with BioNTech in 2018. Having a flu vaccine with much better efficacy, better T-cell and innate immune responses, and more timely manufacture soon after strains are known could dramatically change the trajectory of the disease. We are projected to start first-in-human trials for a modified RNA or modRNA flu vaccine in the third quarter, subject to regulatory approval.

Pending regulatory approval. We also plan to start the Immunogenicity and safety study in August to evaluate an updated version of our team.

The physical it assigned to.

The target the Delta volume.

Here, we show initial data from a small number of patients receiving of sorry of dose of the existing vaccines.

We observed a significant boost the neutralizing antibodies following of third dose of the current vaccine for both wild type and the beta.

At 8 months past the 2 antibody levels start to decline from all your peaks in our initial analysis of third dose given more than 6 months after the second dose.

Michael Dolsten: Preclinical studies were performed with a first-generation modified M1A tetravalent flu vaccine, and the data were compared to data from a marketed flu advectin. Immunogenicity in mice for a first-generation modRNA flu candidate across the 2018-19 northern hemisphere strains was higher, or as high, as the trivalent adjuvanted subunit vaccine. We are encouraged by these data and look forward to progressing this program.

Is it did not neutralizing antibodies, which are more than 5 times higher than the wild type of more.

Barry again times, the higher against the base of ARIA then of the 2 primary doses.

The SAR does elevate the neutralizing antibodies in our laboratory studies up to hundreds of times higher levels post 2.3 compared to pre dose free.

Yes, the as we saw in the analysis.

More than 3 utilizing antibodies from those in the original phase III trials the levels in the older population were comparable to the younger population.

Michael Dolsten: We now turn to our COVID-19 vaccine program in collaboration with BioNTech. The Delta variant, which is the most transmissible we have yet seen, is expanding rapidly worldwide and now represents approximately 83% of sequence cases in the U.S. We continue to believe it is likely that a third dose booster may be needed within 6-12 months after full vaccination to maintain the highest level of protection, and studies are underway to evaluate the safety and immunogenicity of a third dose. We are in ongoing discussions with regulatory agencies regarding a potential third dose booster of the current vaccine and, assuming positive results, anticipate an emergency use authorization submission as early as ordered.

Here, we show new breaking data from a small number of participants that the third dose boost with the current vaccine elicited neutralizing.

So the tightest that when tested against the Delta Varian, where more than fivefold post dose 2 in younger people and more than 11 fold post those 2 in the older people read.

It's eating of Sade does more than 6 months of the explanation when protection may be beginning to wane what is the estimate.

The license catered to potentially boost the neutralizing antibody titers in participants in the study.

2 up 200 times higher post dose 3 compared to pre dose III.

Michael Dolsten: Pending regulatory approval, we also plan to start an immune-initiating safety study in August to evaluate an updated version of our vaccine specifically designed to target the Delta variant. Here, we show initial data from a small number of patients receiving a third dose of the existing vaccine. We observe a significant boost in circulating antibodies following a third dose of the current vaccine for both wild type and the beta variant. However, at 8 months post-dose 2, antibody levels start to decline from earlier peaks.

These preliminary data are very encouraging as delta continues to spread.

Finally, let's turn to our potential.

Estimate of lift price and Claude COVID-19 empty viral protease inhibitor.

If successful our protease inhibitor has the potential to provide patients infected with COVID-19, with the new oral therapy that could be prescribed 4 of 5 day treatment course at the first sign of.

The tension before patients are hospitalized or in critical care.

For patients who are in close contact with someone who contracts COVID-19, we will start the both 5 and 10 day post exposure prophylaxis of courses.

Michael Dolsten: In our initial analysis, a third dose, given more than 6 months after the second dose, elicited neutralizing antibodies that were more than 5 times higher than the wild type and more than 10 times higher against the beta barrier than after two primary doses. The third dose elevates the neutralizing antibodies in our laboratory studies up to 100 times higher levels post-dose 3 compared to pre-dose. Just as we saw in the analysis of neutralizing antibodies from those in the original phase 3 trials, the levels in the older population were comparable to those in the younger population.

The goal is to reduce Sars cov, 2 viral load David.

We can pick all thereby hopefully decreasing or preventing symptoms of COVID-19, and minimizing the risk of hospitalization.

In July we initiated a phase 2 of 3 tower of Io to evaluate efficacy safety and tolerability of the orally administrated.

Sorry about this inhibitors in participants with COVID-19.

If successful we project the potential U S emergency use authorization submission in the fourth quarter.

Our protease inhibitor exhibits potent selective in vitro of antiviral activity against salt.

Michael Dolsten: Here we show new breaking data from a small number of participants that the third dose boost with the current vaccine elicited neutralizing titers that when tested against the Delta variant were more than 5-fold post-dose 2 in younger people and more than 11-fold post-dose 2 in older people. Receiving a third dose more than six months after vaccination when protection may be beginning to wane was estimated to potentially boost the neutralizing antibody titers in participants in this study to up to 200 times higher post-dose 3 compared to pre-dose 3. These preliminary data are very encouraging as Delta continues to spread.

The food and other Corona viruses and potentially all currently known COVID-19 variance.

It also helps demonstrate the.

Bust preclinical antiviral effects on sales and in source KOB 2 infected animals enabled by selectivity that.

It's more than 100 times higher per pool, Rona virus real protest with the human proteins is the.

Chart on the left shows robust dose dependent reductions in disease Microscopical sports in mice in.

In phase 1 human studies to date, we have seen desirable drug exposure good.

Total ability and no safety findings up to a dose of 500 milligrams twice a day over 10 days in healthy volunteers. The chart on the right of the phase 1 pharmacokinetic studies shows high drug exposure over the entire treatment period.

Michael Dolsten: Finally, let's turn to our potentially first-in-class COVID-19 antiviral protease inhibitor. If successful, our protease inhibitor has the potential to provide patients infected with COVID-19 with a new oral therapy that could be prescribed for a five-day treatment course at the first sign of infection, before patients are hospitalized or in critical care. For patients who are in close contact with someone who contracts COVID-19, we will study both 5 and 10-day post-exposure prophylaxis courses.

Exceeding raped it in pipe.

5 times the exposure of predicted to inhibit Sars cov 2 viral replication.

This concludes our review of 8 selected.

Breakthrough programs among many many more to come this decade now let me turn it over to Frank.

Thanks, Michael I know you've seen our release so let me provide a few highlights regarding the financials the.

The COVID-19 vaccine again had a dramatic positive impact on our quarterly results and Albert has already addressed the key points on the COVID-19 landscape looking.

Michael Dolsten: The goal is to reduce SARS-CoV-2 viral load, thereby hopefully decreasing or preventing symptoms of COVID-19 and minimizing the risk of hospitalization. In July, we initiated a Phase II-III TRIO to evaluate efficacy, safety, and tolerability of the orally-administrated protest inhibitors in participants with COVID-19. If successful, we project a potential U.S. Emergency Use Authorization submission in the fourth quarter; Our protease inhibitor exhibits potent, selective, in vitro antiviral activity against SARS-CoV-2 and other coronaviruses and potentially all currently known COVID-19 variants.

Looking at the income statement revenue in adjusted cost of sales was significantly impacted.

With 19 vaccines sales and the associated 50% gross profit split, but beyond tech, which we recognize on the cost of sales line.

Revenue increased 86% operationally in the second quarter of 2021, driven by COVID-19 vaccine sales and solid performance from a number of our other key.

By Congress.

I'm looking at the revenue growth, excluding the COVID-19 vaccine contribution from direct sales and alliance revenues I want to reiterate what average setting that we saw a continuation of solid performance from the business again, this quarter delivering 10% operational growth despite a negative 4% impact from price.

This nicely supports our projected revenue CAGR of at least 6% through the end of 2025 of.

Michael Dolsten: It also has demonstrated a robust preclinical antiviral effect on cells and in SARS-CoV-2 infected animals, enabled by selectivity that is more than 100 times higher for coronavirus real proteases than human proteases. The chart on the left shows robust dose-dependent reductions in disease, and microscopical scores in mice. In Phase 1 human studies today, we have seen desirable drug exposure, good tolerability, and no safety findings up to a dose of 500 mg twice a day over 10 days in healthy volunteers.

Of course, there will be some variability in quarterly growth rates due to a variety of factors, but we continue to expect at least 6% through 2025.

There was no impact from the number of selling days in the quarter as compared to the year ago period likely.

Growth of sorrow, and all first quarter, where we had more selling days compared to the year ago period, I'd remind you that the offset to this imbalance will be seen in the fourth quarter results, where we have fewer selling days as compared to the year ago quarter for the full year of this results in essentially the same number of selling days in 2021 of 2020.

The adjusted costs.

Likewise sales increase shown here reduced this quarter's gross margin by 19 percentage points compared to the second quarter of 2020, which primarily reflects the impact of the COVID-19 vaccine gross profit split and applicable royalty expenses. In addition to much smaller impacts from foreign exchange product mix adjusted.

Michael Dolsten: The chart on the right of the Phase 1 pharmacokinetic study shows high drug exposure over the entire treatment period, exceeding greater than five times the exposure predicted to inhibit SARS-CoV-2 viral replication. This concludes our review of eight selected... breakthrough programs among many more to come this decade. Now, let me turn it over to Frank.

Cause the same expenses increased only 2 of more normalized level of promotional and sales force activity along with some impact from foreign exchange.

The increase in adjusted R&D expense. This quarter was driven by increased investments in the COVID-19 vaccine and anti viral programs as well as other programs within our pipeline.

Given.

Even the tax effect of increased COVID-19 vaccine revenue our tax rate.

Which will impact our guidance, which will I speak to which I'll speak to in a minute.

Frank D'Amelio: Thanks, Michael. I know you.

Frank D'Amelio: You've seen our release, so let me provide a few highlights.

Reported diluted EPS for the quarter was up 58% compared to the year ago quarter, while adjusted diluted EPS grew 73%.

Frank D'Amelio: The COVID-19 vaccine again had a dramatic positive impact on our quarterly...

For the quarter.

Foreign exchange movements resulted in a 6% benefit to revenue as well as the 6% benefit of of <unk> to adjusted diluted EPS now, let's move to our revised 2021 guidance. We've again provided total company guidance, which includes the business with the COVID-19 vaccine and.

Frank D'Amelio: Albert has already addressed the key points on the COVID-19 landscape. Looking at the income statement, revenue and adjusted cost of sales were significantly impacted by COVID-19 vaccine sales and the associated 50% gross profit split with BioNTech, which we recognize on the cost of sales line. Revenue increased

And then we provided some additional sub ledger detail on our assumptions regarding the projected COVID-19 vaccine contribution. So you can also see our projections for the business without the COVID-19 vaccine.

Our revenue projection has increased and we now expect it to be in a range of $78 billion to $80 billion with the COVID-19 vaccines.

Frank D'Amelio: 86% operationally in the second quarter of 2020.

Revenue for the year of being projected to be approximately $33.5 billion based on contracts signed through mid July.

Frank D'Amelio: 21, driven by COVID-19, vaccine sales, and

I note that this projection does not include the doses with our contract with the U S government announced last week.

Frank D'Amelio: and solid performance from a number of our other key growth drivers.

Frank D'Amelio: I'm looking at revenue growth excluding the COVID-19 vaccine contribution from direct sales and Alliance revenues. I want to reiterate what Albert said, in that we saw a continuation of solid performance from the business again this quarter, delivering 10% operational growth despite a negative 4% impact from price. This nicely supports our projected revenue CAGR of at least 6% through the end of 2025. Of course, there will be some variability in quarterly growth rates due to a variety of factors, but we continue to expect at least 6% through 2025.

For adjusted cost of sales the range has increased to between 39% to 40%.

Which incorporates the incremental anticipated COVID-19 vaccine revenue, which has a significantly higher cost of sales due to the gross profit split with beyond tech as compared to the rest of the business the.

The projected COVID-19 vaccine revenue as a percentage of total company revenue at the mid points has increased to 42% as compared.

6% and our previous 2021 guidance.

Adjusted SG&A, we have made a small increase of the projection now expect the 11.5 to $12.5 billion. In addition, we increased our adjusted R&D guidance range to $10 to $10.5 billion to incorporate anticipated spending on incremental COVID-19.

The 38 programs and other mrna based projects that are not part of the biotech collaboration.

Given the tax effect of increased COVID-19 vaccine revenues, we are increasing our projected tax rate for the full year to approximately 16% the.

Frank D'Amelio: There was no impact from the number of selling days in the quarter as compared to the year-ago.

This yields an increased adjusted diluted EPS range of $3.95.

Frank D'Amelio: I'd remind you that the offset to this imbalance will be seen in

<unk>, the $4.5 or 77% growth at the midpoint compared to $20.20, including an expected 4% benefit from foreign exchange.

Frank D'Amelio: and the fourth quarter results.

Frank D'Amelio: For the full year, this results in essentially the same number of selling days in 2021-2022. The adjusted cost of sales increase shown here reduced this quarter's gross margin by 19% compared to the second quarter of 2020, which primarily reflects the impact of the COVID-19 vaccine, gross profit split, and applicable royalty expenses in addition to much smaller impacts from foreign exchange products. Adjusted SINA expenses increased owing to a more normalized level of promotional and salesforce activity along with some impact from foreign investors.

Let me quickly remind you of some assumptions and context on the projected COVID-19 vaccine contribution and our collaboration agreement as discussed earlier.

The <unk> COVID-19 vaccine collaboration construct is the 50.50 gross profit split.

Size of the books, the vast majority of the global collaboration revenue, except for Germany, and Turkey, where we receive a profit share from biotech and we do not participate in the China region.

We now expect that we can manufacture.

2 billion doses in 2021 subject to continuous process improvements expansion of the current facilities and adding new suppliers and contract manufacturers.

As of mid July we have contracted for approximately $2.1 billion vaccine doses for delivery in 2021, which drove our projection of approximately 33.

Frank D'Amelio: The increase in adjusted R&D expense this quarter was driven by increased investments in the COVID-19 vaccine and antiviral programs, as well as other programs within our pipeline. Given the tax effect of increased COVID-19 vaccine revenue, our tax rate

$3.5 billion in revenue for the year.

Our cost of sales for the COVID-19 vaccine revenue continues to include manufacturing and distribution cost applicable royalty expense as well as the payment biotech representing the 50, 50% gross profit split.

Frank D'Amelio: COVID-19 vaccine revenue, and our tax rate on

Frank D'Amelio: which will impact our guidance, which I will speak to in a minute. Reported diluted EPS for the quarter was up 58% compared to the year-ago quarter, while adjusted diluted EPS grew 73%.

We continue to expect that the adjusted income before tax margin the.

The the COVID-19 vaccine contribution to be in the high Twenty's as a percentage of revenue. This margin level also includes the anticipated spending on additional mrna programs. Let me add that if we contract for delivery of additional doses. During the year, we will provide a guidance update and our subsequent earnings releases.

Frank D'Amelio: The benefits resulted in a 6% benefit to revenue as well as

If we remove the projected.

19 vaccine contribution from both periods you will see that we slightly increased the 2021 revenue range to 45 to <unk> 47 billion, representing approximately 7% operational revenue growth at the midpoint in terms of adjusted diluted EPS without the contribution from the COVID-19 vaccine.

Frank D'Amelio: T-Rex, T-Rex, T-Rex, T-Rex, T-Rex,

Frank D'Amelio: Now let's move to our revised 2021 guidance. We've again provided...

Frank D'Amelio: We've again provided total company guidance, which includes the business with the COVID-19 vaccine, and then we've provided some additional detail on our assumptions regarding the projected COVID-19 vaccine contribution, so you can also see our projection for the business without the COVID-19 vaccine. Our revenue projection has increased, and we now expect it to be in a range of $78 to $80 billion, with COVID-19 vaccine revenue for the year projected to be approximately $33.5 billion based on contracts signed through mid-July. I note that this projection does not include the doses in our contract with the U.S. government announced last month. For adjusted cost of sales, the range has increased to between $39.00 and $42.00.

Covid of increase the range to be between $2.55 to 65 for the year, which represents approximately 11% operational growth at the midpoint. These.

These growth rates are all consistent with how we've been publicly positioning the business post the upjohn separation.

Going forward, we will continue to maintain a prudent stance towards.

We have of the allocation activities with the opportunities for deployment shown here on this slide in summary of strong quarter and first half of the year and we have increased our revenue and EPS guidance for the remainder of the year. In addition, we've had pipeline advances and just completed a very promising business development agreement with our venous I'll now turn.

Turn it over to Chris to start the Q&A session.

Jeff.

Yeah.

Thank you Frank.

Operator, if we could have the first question. Please.

Okay.

Ladies and gentlemen, if you would like to ask a question. Please press star 1 on your telephone keypad.

Your first question comes.

Comes from the line of Kerry Holford from Bamberg.

Okay, a few questions on the Kennedy vaccine.

Especially important in classification can I just check the upgrade the switching from day 1.

Frank D'Amelio: This incorporates the incremental anticipated COVID-19 vaccine revenue, which has a significantly higher cost of sales due to the gross profit split with BioNTech as compared to the rest of the business. The projected COVID-19 vaccine revenue as a percentage of total company revenue at the midpoints has increased to 42% as compared to 36% in our previous 2021 guide. On adjusted SINA, we have made a small increase to the projection; now we expect $11.5 to $12.5 billion. In addition, we increased our adjusted R&D guidance range to $10 to $10.5 billion to incorporate anticipated...

On the sales guidance of the vaccine the <unk>.

Many of the days when do you expect to deliver this year.

Today's call of duty delivery.

Interest he doesn't change.

As you stand today can you talk directionally about how you see 'twenty 'twenty 2 David.

Got to yourselves relative to the mute.

The thing up the 'twenty 'twenty 1.

It was the most of the days or does he have secured the quiet delivery of the new updated version of that.

That's why it's the covenants the delta variants.

And then finally can we assume the price per dose in the.

Frank D'Amelio: to incorporate anticipated spending on incremental COVID-19 related programs and other mRNA-based projects that are not part of the BioNTech collaboration.

The most recent order from the U S government is equivalent to pry use all days.

How does that.

The pricing comparing the ex U S contracts the eve more recently signed.

Frank D'Amelio: Given the tax effect of increased COVID-19 vaccine revenues, we are

Frank D'Amelio: We are increasing our projected tax rate for the full year to approximately 16% this year.

Thank you.

Thank you very much Karen maybe I can give you of announcements of us as Frank said in Houston the remarks in the 'twenty 'twenty..1 we provided guidance for approximately $2.1 billion doses. These all confirmed all of the contracts time.

Frank D'Amelio: The latest adjusted diluted EPS range of $3.95 to $4.05, or 77% growth at the midpoint compared to 2020, including an expected 4% benefit from foreign Let me quickly remind you of some assumptions and context on the projected COVID-19 vaccine contribution and our collaboration. As discussed earlier, the Pfizer-BioNTech-COVID-19 vaccine collaboration construct is a 50-50 gross profit split.

We have said repeatedly.

Senior.

All of a pretty bullish when you walk through sort of this year.

We are of course, we're discussing the bulk of those losses in most all of them all the very advanced discussions. So I believe that the we will eventually all of those doses now.

Now keep in mind.

We do the moving to spectrum of half as we said the.

The very big number of doses will go to middle income countries, 1 of the prices of over the different Oh the Hoffman the.

Frank D'Amelio: Pfizer books the vast majority of the global market

Frank D'Amelio: Global Collaboration Revenue, except for Germany and Turkey, where we receive a profit.

2 low income countries and the lower end.

The low middle level of Congress, where we provide the.

On the non for profit basis so.

Frank D'Amelio: BioNTech, and we do not participate in the China region. We now expect that we can manufacture up to 3 billion doses in 2021, subject to continuing

I'm going to do the takes that into consideration. The second thing that we need to take the preparation. It is that all of our all financier of calendar is north of the exact like the the.

Frank D'Amelio: Continuous process improvements, expansion of current facilities, and

The police the economy, which means that the December sales.

Sales.

ER will not be.

And going to 2021if it is internationally is going to go through when the 22. This is how our right not sort of calendar works only the U S sales of December would be accounted in the I V.

Frank D'Amelio: and any new suppliers and contract manufacturers.

Frank D'Amelio: As of mid-July, we have contracted for approximately 2.1 billion vaccine doses.

Yeah, there will be significant number of doses about the will be allocated.

Frank D'Amelio: doses for delivery in 2021, which drives our projection of approximately 33%.

It in December as part of the free video doorbell.

How the 2022 looks like it's very early to speak.

Frank D'Amelio: 3.5 billion in revenue for the year. Our cost of sales for the COVID-19 vaccine revenue continues to include

We have the multiple countries of that they have already.

Companies the agreements for 'twenty 'twenty 2.

In 2023 like Europe for example of Israel kind of the kind of actually.

They have all shall we go all the way to dwindle and before you ask just booked an additional 200.

Frank D'Amelio: Manufacturing and Distribution Cost, Applicable Royalty Expense, as well as a payment to BioNTech representing the 50% gross profit Continue to expect that the adjusted income before tax margin for the COVID-19 vaccine contribution will be in the high 20s as a percentage of revenue. This margin level also includes the anticipated spending on additional mRNA products. Let me add that if we contract for delivery of additional doses during the year, we will provide a guidance update in our subsequent earnings release. If we remove the projected COVID-19 vaccine contribution from both periods, you will see that we slightly increased the 2021 revenue range to $45 to $47.

Many of them doses and the eventual every company in the World right now I was discussing with us for additional doses all of our total.

The capacity for.

The 2022 it is for.

Olivia the adopters and then I believe given the needs.

The but likely it will be allocated to the entire world.

When you asked the question about the Delta variants.

And maybe I will ask Michael to provide the.

Uh huh.

Thank you all bets.

The in the presentation.

All day right now point to that.

The current vaccine is highly effective against Delta Barry on.

There may be waning over time.

I'm as often as seen with the vaccine and that's why we shared today that if you do get a third dose booth of the current vaccine.

You seem to regain very high neutralizing antibody against Delta.

Frank D'Amelio: 1 billion, representing approximately 7%

Frank D'Amelio: [inaudible] In terms of adjusted diluted EPS, without the contribution from the COVID-19 vaccine, we have increased

We are also producing a delta of variant of specific vaccine.

It mainly to make sure we cover all of the option of the future, but we remain highly confident in that the current vaccine when used appropriately will be effective against them.

Frank D'Amelio: range to be between 255 and 260.

Frank D'Amelio: 5 for the year, which represents approximately 11% operational growth at the These growth rates are all consistent with how we've been publicly positioning the business post the Upjohn separation. Going forward, we will continue to maintain a prudent stance toward our

And we are in dialogue with regulatory agencies about this potential of it.

Todd the dues.

The of the vaccine pending epidemiology of them the <unk>.

Accelerated over time, thank you.

Thank you very much Michael and take care of you also on the price per dose, we do not discuss all prices with each individual country, but to sort of given our overall policy.

Frank D'Amelio: In summary, a strong quarter and first half of the year, and we have increased our revenue and EPS guidance for the region.

It says that the high income countries, they've had comparable prices, but the very only because the based on the ER.

Christopher Stevo: and we have increased our revenue and EPS guidance for the remainder of the year. In addition, we have had pipeline advances and just completed a very promising business development agreement with Arvinas. I'll now turn it over to Chris to start the Q&A session.

We give discounts to the surprises based on the volume stuff that commitment ER.

Middle income countries that have approximately half of our price and the for the.

The.

The lower meet the envelope income cash.

We are providing all vaccines that are non for profit base.

Yeah.

Thank you Albert.

Operator: Operator, if we could have the first question, please. Ladies and gentlemen, if you would like to ask a question, please press star 1 on your telephone keypad. Your first question comes from the line of Carrie Holford from Barenburg. Thank you. A few questions on the COVID vaccine, please. Firstly, a point of clarification: can I just check that the upgraded 2021 sales guidance for the vaccine reflects only the doses you expect to deliver this year and not for those contracted?

Please operator.

Alright.

Got it.

Your next question comes from Matthew Harrison from Morgan Stanley.

Okay.

Countries.

Great. Good morning, Thanks for taking the questions a few if I may.

First on the regulatory outlook for the Jack and do you have any idea on how long. The FDA may continue to review of the file of our when we might expect to see some response on next steps.

There.

And then second on the mrna flu vaccine can you comment on the potential regulatory picture. There do you think you may be able to get that approved just based on titers or do you think youll have to actually run of head to head study versus the existing flu vaccines. Thanks very much.

Operator: Ladies and gentlemen, if you would like to ask a question, please press star 1 on your telephone keypad. Your first question comes from the line of Carrie Holford from Barenburg.

The other bucket Michael I think.

You could take those 2 questions and then Andy if I answer that wants to add something on the cost.

Albert Bourla: Thank you very much, Kerry. Maybe I can give you an answer to that.

Yeah. Thank you well as you know ER.

Albert Bourla: As Frank said in his remarks in 2021, we provided guidance for approximately 2.1 billion doses. These are confirmed orders at contract time. We have said repeatedly that we expect to have 3 billion doses manufactured this year. And we are, of course, discussing those doses, and most of them are in very advanced discussions. So, I believe that we will eventually allocate all doses. Now, keep in mind that in the second half, as we said, a very large number of doses will go to middle-income countries where the price is very, very different, almost half, and to low-income countries and low-middle-income countries where we provide the doses on a non-for-profit basis.

F D a.

The other agencies are reviewing.

Reviewing both the.

Shifting of new Jets in the F D. A we all waiting.

And to conclude.

Final assessment of the stallions stadia.

And during that period, they have the past Purdue pharma.

Timeline for both us and other debt to develop new Jack we starting the hope as the workload from Covid.

May attenuate that the agency will have soon <unk>.

<unk> been able to review all available data as we do consider the jacks have us really meaningful and important role in management of all array properly used in the right patients and all the.

For the indications, where there are fewer alternatives such as atopic dermatitis alopecia vitiligo and so on so we cannot give any firm timelines, but we certainly hope it will be relatively soon.

Albert Bourla: The second thing that you need to take into consideration is that our financial calendar is not the exact same as the political calendar, which means that December sales will not be going to 2021 if it is international, but it is going to go to 2022. This is how our financial calendar works.

For the mrna flu vaccines.

We plan.

The newest all our first in human studies shortly based on some of the encouraging data we showed from preclinical studies.

We will boast 1.

Immunogenicity study as well as head to head study here given the high potency.

Albert Bourla: Only the U.S. sales of December will be accounted for this year, and a significant number of doses that will be allocated in December as part of the 3 billion document. How 2022 looks like, it's very early to speak, but we have multiple countries that have already accomplished agreements for 2022 and 2023, like Europe for example, Israel, Canada, Canada actually, they have also, they go all the way to 2024. The US just got an additional 200. Then you asked a question about the Delta variant, and maybe I will ask Michael to provide a view on that.

All of the mrna we are optimistic and we believe there is the.

Good opportunity that 1 can create a premier of X, the where the superior efficacy versus existing flu vaccine. That's why we think.

Not only to demonstrate hi.

High titers, but also demonstrate.

Superior efficacy would be very valuable and we are gearing up using all our experience to run trial fast.

To look at the time schedule for both Immunogenicity and head to head event trial.

Yeah.

And sort of do you have anything to read.

I think Michael covered all the key points you know just to reassure everyone that we all in constant communication with the FDA.

Albert Bourla: Thank you, Albert. As you noted in the presentation, all data right now point to that, The current vaccine is highly effective against delta variants. There may be waning over time as often is seen with the vaccine and that's why we shared today that if you do give a third dose boost of the current vaccine you seem to regain very high neutralizing antibody against Delta, We are also producing a Delta variant-specific vaccine, mainly to make sure we cover all options of the future, but we remain highly confident in that the current vaccine, when used appropriately, will be effective against Delta, and we are in dialogues with regulatory agencies about this potential of a third dose of a vaccine pending epidemiology of the vaccinated over time.

And you know, they're just doing the risk benefit analysis.

I think like with any and all molecule and so we are very confident that the reason the roll that out of Jack do you play and we get.

No waiting eagerly to all their response profit from the.

Yeah. Thank you. Thank you.

The critical ahead with the next question please.

Your next question comes from Daniel <unk> from RBC capital.

Hi, Thanks for the questions I've got 2 the first on the COVID-19 vaccine.

It's fair to say that Pfizer has been a bit more outspoken about the likely need for recurring booster doses than C. D E and F D. A.

The slight at least at this point in time can you provide any additional color about why that's the case is it simply a matter of letting the day to catch up to what you view as a likely eventuality or is it a function of Pfizer and regulatory agencies interpreting the data that we have today.

Albert Bourla: And I also want to talk about the price per dose. We do not discuss our prices with each individual country, but we have given our overall policy, which says that the high-income countries have comparable prices, but they vary only because we give discounts on these prices based on the volumes that are committed.

Perhaps differently than.

And second with respect.

The president of 'twenty.

Can you talk a little bit about your expectations for October as Ace It meeting and what you would characterize as a good outcome for the adult use vote.

Yeah.

Maybe I can give you of the answer to the Covid and the manzella kind of.

Albert Bourla: Thank you, Albert. Next question, please, operator. Oh, sorry.

Can take the the problem or I'm going to ER.

I don't think that there is different.

In addition of data between us and the regulatory authorities around the world actually.

Operator: Your next question comes from Matthew Harrison from Morgan Stanley. Thank you for listening.

These are extremely.

Extremely good collaboration and the.

Same interpretation I think.

Operator: Great. Good morning.

Operator: Thanks for taking the questions; a few if I may. First, on the regulatory outlook for JAK, do you have any idea how long the FDA may continue to review the file or when we might expect to see some response on next steps there? And then second, on the mRNA flu vaccine, can you comment on the potential regulatory picture there? Do you think you may be able to get that approved just based on titers, or do you think you'll actually have to run a head-to-head study versus the existing flu vaccines? Thanks very much. Michael, I think you could take those two questions.

What we have said is not new.

The 4 months I'm, saying, but we believe based on the data of a hersey holistically about the we will need.

The booster 8 to 12 months and ER.

After all.

The second dose and the.

We have seen but the delta.

Might be needed the little bit earlier, but they go on for some parts of the population and but we have something of the day, but yet so I don't think of that EBITDA or see the seeking an spa.

The interpreter because of its a very different authorities when they speak.

So to me the have very different considerations, we will submit those days of them by over 60, they are aware all of them and ER.

Michael Dolsten: Michael, I think you could take those two questions and then see if Angela wants to add something to the chat. Yeah, thank you. Well, as you know, FDA and other agencies are reviewing both existing and new JACs. At FDA, we are waiting for them to conclude the final assessment of the stellium study. And during that period, they have passed PDUFA, a timeline for both us and others that have developed new JAKs. We certainly hope, as the workload from COVID may attenuate, that the agency will have soon been able to review all available data, as we do consider that JAKs have a really meaningful and important role in the management of RA, properly used in the right patients, and also new indications where there are fewer So we cannot give any firm timelines, but we certainly hope it will be relatively soon.

The EBITDA needs to review them, and then provide the or not there.

And then what.

Once it is approved the share those sportster than CDC makes to understand the situation in the country Duckworth over a period of the fine and they will have to make the recommendation of alcohol.

So all the same happens in different countries and the depends sort of what percentage of of the population.

The relationships have been vaccinated.

Earlier in the year or later in the year or they may have very different central San Francisco clearly of countries of the bid.

A big percentage of the population in the January February.

Tom frame they've got.

Very different of nursing because of the time.

The the Kraken speaking.

And without sort of I will go through until about the b of a.

Prevalent of trend.

In CIB.

Yeah. Thanks, Thanks, All day, well you know you've heard out of all the talk about the you know the very differentiated label that we do have with krabbe not 'twenty in his opening comments.

And just to reinforce that you got the 20 serotypes.

And the coverage that the broad coverage of that provides but also.

The fact that all label contain indication for both IPD as well as pneumonia.

Michael Dolsten: For the mRNA flu vaccines, we plan to start our first human studies shortly based on some of the encouraging data we showed from preclinical studies. We will both run immunogenicity studies as well as head-to-head studies. Given the high potency of the mRNA, we are optimistic, and we believe there is a good opportunity that one can create a premier vaccine with superior efficacy versus existing flu vaccines. That's why we think not only to demonstrate high titers but also to demonstrate superior efficacy would be very valuable, and we are gearing up, using all our experience to run trials fast, to look at the time schedule for both immunicity and Angelo, do you have anything to add?

Its really unique and I think that there's pneumonia indication and you know is a.

You know the true strength at the present all family being that we're the only company that had the 80000 catheter trial, where the pneumonia indication was based.

And so with this all of what we anticipate coming up in October of policy questions that will be addressed for both PCB.

The 'twenty as well as the Merck's 15, and we have an early read into this already because at the last ACI P meeting a different policy questions were posed for both products full price or 'twenty. There's a question around.

Vaccinations of 65, plus as well as 50.

50, plus in addition to the 18 to 49 or 18 to 59 immuno compromised form of 15, the the age range and the policy question posed there was supposed to 65 plus so when you look at what's different all the the only price not 'twenty was ER being.

Angela Hwang: I think Michael covered all the key points, you know, just to reassure everyone that we are in constant communication with the FDA and they're just doing their risk-benefit analysis as they would with any and all molecules, and so we're very confident that there is a role that our JACs do play, and we just, you know, we're waiting eagerly for the response from the FDA. Thank you. Thank you.

King.

What's being looked at for the 50, plus so we'll have to see how the oldest ends up and we're looking forward to having a robust discussion at the October ACI P. But I think that the set up all of the policy questions give us a good view into what the discussions will look like and what the outcomes.

Operator: Greater, go ahead with the next question, please. Your next question comes from Daniel Busby from RBC Capital.

Some might be.

So thanks for the question.

Operator: Hi, thanks for the questions. I've got two.

Thank you Angela next question. Please operator.

Your next question comes from Chris Schott from J P. Morgan.

Operator: First, on the COVID-19 vaccine, I think it's fair to say that Pfizer has been a bit more outspoken about the likely need for recurring booster doses than CDC and FDA, at least at this point in time. Can you provide any additional color about why that's the case? Is this simply a matter of letting the data catch up to what you view as a likely eventuality? Or is it a function of Pfizer and regulatory agencies interpreting the data that we have today? Perhaps differently, with respect to Prevnar-20, could you talk a little bit about your expectations for October's ACIP meeting and what you would characterize as a good outcome for the adult use vote?

Great. Thanks, so much for the questions I'm, just kind of much of the book.

COVID-19 booster would you envision the.

It has an annual booster or with these levels of antibody titers would you envision that third dose could give more sustained protection against the Covid is think about just kind of all of the market evolves over time.

And then my second question was just coming back to the Jacks and just 2 more detailed questions I guess first any change in thinking as we think.

About abra sitting at the 100 milligram versus the 102 hundred milligram of approvals. The I don't see anything you've learned with regular regulatory interactions et cetera. That's changed your view there and then maybe second question on the Jacks, It's just with Xeljanz, what wouldn't EMEA like label revision mean for Xeljanz.

Albert Bourla: Maybe I can give you the answer to COVID and then Angela can take Prevnar to Andy. I don't think that there is a different interpretation of data between us and regulatory authorities around the world, actually. There is extremely good collaboration and the same interpretation. I think what we have said is not new. For months, I've been saying that, based on the data that we have, we believe that we will need a booster 8-12 months from the second dose, and we have seen that with Delta, that might be needed a little bit earlier, particularly for some parts of the population.

As we think about the U S commercial opportunity. Thanks, so much.

Yeah, Michael I think you can think of the the boost or any of them. So far easy to sort of dosing Dom you think or is it going to be of non you. All 3 bucks of nations and then Angela we moved through Q4 of the <unk> Xeljanz.

Thank you.

Well Albert spoke all Europe.

To the importance of both Halloween.

<unk> seen efficacy in different regions of the world and entry of new strength.

Right now we have a surge in the deltas the way it's the most in pick your strength ever seen and its.

It puts pressure on vaccinated individuals.

Albert Bourla: But we haven't submitted the data yet, so I don't think that FDA or CDC can speak for themselves because they have very different authorities when they speak. The FDA needs to review them and then provide or not their approval, and then once it is approved, the third dose booster, then CDC needs to understand the situation in the country at that particular period of time, and they will have to make a recommendation about the booster.

The data we showed today indicate at 6 to 8 months, we can boost up to 100 fold the antibody tight the after the dose compared to pre dose.

At the same time, we hear reports from various parts.

Of the World real World evidence that they do see some breakthrough case use.

All of the Delta variant in vaccinated. So these type of data is the typical package, we will put together in the case for all good stuff Ms. Janet Albert alluded to tourists or the dose we will continue.

Albert Bourla: So the same happens in different countries and depends on what percentage of the population has been vaccinated earlier in the year or later in the year; they may have a very different sense of urgency. Clearly, countries that did a big percentage of their population in the January-February time frame have a very different urgency because time is, the clock is ticking, and with that, I will go to Angela about the Prevnar plant and ACIP. Thanks. Thanks, Albert.

Tenure Tom.

Monitor and generate the data on the impact of of THAAD, those which we do have ongoing in our phase III.

And possibly soon woodson of real world evidence.

We expect the third dose to be of potent and somewhat maybe more long lasting.

And the.

The second.

But we also recognize that the virus constantly of bold and you all start to notice about Delta plus very young.

Albert Bourla: Thanks, Albert. Well, you know, you heard Albert talk about the, you know, the very differentiated label that we have with Prevnar 20 in his opening comments. And just to reinforce that, you know, the 20 serotypes and the coverage that the broad coverage that provides, but also the fact that our label contains indications for both IPD as well as pneumonia, is really unique. And I think that this pneumonia indication, you know, is a, you know, it's a true strength of the Prevnar family, being that we're the only company that has the 80,000-capita trial where this pneumonia indication was saved.

While I cannot predict with certainty certainty the future I would not be surprised if sema lots of flu that we.

Would need with into all to boost our vaccine against Covid, whether this will be on the manual or based on simple diagnostic ER. That's allowed you to boost at the right time before youll risk or impacting side with.

We need to monitor but all in all we believe that.

Similar to our flu business it may be likely for the Covid business, but we all gathering data to validate and will constantly work with.

Key opinion leaders and regulators.

In interpreting the data.

Angela.

Great I'll start with Admiral.

The the the conversations and the discussions that we're having with the FDA as it pertains to AB row had been concern.

Angela Hwang: And so with this, what we anticipate coming up in October are policy questions that will be addressed for both PCV20 as well as Merck 15. And we have an early read on this already because at the last ACIP meeting, different policy questions were raised for both products. For Prevnar 20, there's a question around vaccinations of 65 plus as well as 50 plus in addition to the 18 to 49 or 18 to 59 immunocompromised.

System and in at the point as we've discussed earlier, we're just where we're just waiting and waiting to hear from them as to their their sort of the point of view.

But both doses are still in discussion and and I think.

The correctly I think I'll kind of the way he might be going with your question instead of what happens if we only get 1 or the other and and I just want to reinforce that we are very confident in the potential of abra or whether it's the bulk of kid or ASP of 1 and the reason is that we come back to the site.

Angela Hwang: For Merck 15, the age range and the policy question posed there were for 65 plus. So when you look at what's different, the only Prevnar 20 was being, you know, was being looked at for the 50 plus. So we'll have to see how all this ends up, and we're looking forward to having a robust discussion at the October ACIP. But I think that the setting of these policy questions gives us a good view into what the discussions will look like and what the outcomes might be.

<unk> of the market and with.

We've discussed this before that there is a very very large market with the huge unmet need of 6.

The patients traveling up with atopic dermatitis, only 4 million of those all be treated today with any systemic therapy and because this is such a heterogeneous disease and patients.

Patients really need you know different options.

And so so we're really looking forward to hearing back from the FDA, but we believe that the risk benefit profile of <unk> sitting there is going to have a role in the treatment of the atopic dermatitis patients and it will be a well kind of condition, you know and and an additional option that patients really need.

Operator: Thank you, Angela. Next question, please, operator.

Operator: Your next question comes from Chris Schott from J.P. Morgan.

And then coming back to Xeljanz, you had a question around out EU label.

Operator: Great. Thanks so much for the questions. I'm just coming back to the COVID-19 booster.

So actually the changes to the EU label were posted in G&A, Although we're still waiting for the the final S. P. M C.

Operator: Would you imagine this as an annual booster? Or, with these levels of antibody titers, would you imagine that a third dose could give more sustained protection against COVID? Just think about just kind of how the market evolves over time. And then my second question was just coming back to the JACs and asking two more detailed questions. There's first, any change in thinking as we think about abracitinib, the 100 milligram versus the 100 and 200 milligram approvals? learned with regulatory interactions, et cetera, that's changed your view there.

S M P C excuse me.

And there the label is really looking at a cost.

We note for those who are 65, plus who are smokers or having the malignancy risk and the caution there is bought ER physicians to consider all alternative therapies prior to using the downtown and so I think this is pretty consistent with how xeljanz is being used today.

Caution and if you look at where the utilization is more than half of our business is in third line treatment, which is after the ER utilization of other you know that.

Of the treatments like biologic. So again I think we'll wait to see how this plays out but the.

Michael Dolsten: And then maybe the second question on the jacks is just with Xeljanz, what would an EMEA-like label revision mean for Xeljanz as we think about the U.S. commercial opportunity? Thanks. Yes, Michael, I think you can take the booster in terms of, is it the third dose and done, do you think, or is it going to be an annual revaccination? And then Angela, we move to you for instructions. Thank you.

The fact that it is being recommended for third line is very consistent.

With how it's being used today.

Thanks, John.

Yes.

So the end of next question. Please your net.

Question comes from Ronny Gal from Bernstein.

Good morning, and thanking the thank you for taking my questions. The first of all we'll also be in.

I fully understand the say this point around the third certain of the third dose increasing antibody titers significantly.

The the counterpoint that has been read is that the third dose is not needed because while antibodies Wayne immunity against severe disease is not or at.

Michael Dolsten: Well, Albert spoke earlier about the importance of both following vaccine efficacy in different regions of the world and the entry of new strains. Right now, we have a surge in the Delta strain. It's the most infectious strain ever seen, and it puts pressure on vaccinated individuals.

Both John so far waned over time can you discuss a little bit how you see the weighting of community and the large public and the elderly as youre seeing it for for.

For the your vaccine.

Michael Dolsten: The data we showed today indicate that at 6-8 months, we can boost up to 100-fold the antibody titer after the dose compared to pre-dose. At the same time, we hear reports from various parts of the world, real-world evidence, that they do see some breakthrough cases of the Delta variant in vaccination. So this type of data is a typical package we will put together in this case for August admission, as Albert alluded to, for a third dose.

Even if the antibody dose comes down.

The second question is around Biosimilar business. This is something you highlighted we have not really.

At least the blood and the pipeline of the clinically available pipeline for your Biosimilar business beyond the Humira Biosimilars can you discuss your plans for that business are you still of the emphasis for Pfizer of are you deemphasizing that.

Okay.

Thank you.

Seeing all the comments on Oh the firm.

We see waning of immunity also in the severe disease already in hospitalizations ER.

Michael Dolsten: We will continue to monitor and generate data on the impact of a third dose, which we do have ongoing in phase 3, and possibly soon also in real-world evidence. We expect the third dose to be potent and somewhat, maybe more long-lasting than the second, but we also recognize that the virus constantly evolves, and you all start to notice delta plus variants. Hence, while I cannot predict with certainty the future, I would not be surprised if, similar to the flu, we would need, with interval, to boost our vaccine against COVID.

We have assumed rate of above the.

Michael.

Yeah. Thank you Albert it's very good question so first.

We do see them all.

True.

After 6 to 8 months more rapid way.

Turning infections and mild to moderate symptoms those are likely.

Entirely or to a large degree dependent on antibodies.

And the drop and tied to that we alluded to.

If you raised you may have a good probability to reverse that waning.

Fortunately them all.

The protection against severe disease hospitalization and Paypal outcomes.

<unk>.

Remains.

Pretty high.

But we.

We do see some lowering particular in real world evidence studies from Israel, we see some lowering in the protection.

Michael Dolsten: Whether this will be on an annual basis or based on simple diagnostics that allow it to be boosted at the right time before your risk for infection is high, we need to monitor. But all in all, we believe that, similar to a flu business, it may be likely for the COVID business, but we are gathering data to validate and will constantly work with key opinion leaders and regulators in interpreting the data.

In risk groups, such as older adults immuno compromised.

And that's likely because in addition to antibodies T cells.

Our.

All in the.

Keeping up strong defense.

Against severe disease, which is later in the infection process.

And particularly when antibodies have waned, but the slow.

Operator: Great. I'll start with Abro.

Angela Hwang: The conversations and the discussions that we're having with the FDA as it pertains to Abro have been consistent. And at this point, as we've discussed earlier, we're just waiting to hear from them as to their points of view. But both doses are still in discussion, and I think, you know, ultimately, I think where you might be going with your question is sort of what happens if we only get one or the other.

But still noticeable.

Gradual decline.

In protection also against severe disease is something that's on our eyes.

And certainly we believe the bi boosting you may strengthen antibodies and T cells.

And you have an early warning signals, where the to do that with some modest.

Just waning in hospitalization given its.

The risk of severe outcome.

All right.

The interpretation of that all in all I think of third does wood.

Strongly improve protection against infection mild moderate disease.

Angela Hwang: And I just want to reinforce that we are very confident in the potential of Abro, whether it's for both doses or for just one. The reason is that we come back to just the size of the market. We've discussed this before, but there is a very, very large market with huge unmet need. There are 60 patients, 12 and up, with atopic dermatitis. Only 4 million of those are being treated today with any systemic therapy.

The CS and reduce the spread of the virus, but also give you some extra muscle.

And reverse the slower decline against severe disease. So this is how we're looking at it from multiple angles in order to describe the full.

Opportunity.

Attunity with boost.

Thank you all micro Angela.

Thanks for the question on the price and certainly we can carefully read the at the tremendous growth that we've seen in this area and Dan and the tanker fleet.

Angela Hwang: And because this is such a heterogeneous disease, patients really need, you know, different options. And so we're really looking forward to hearing back from the FDA. But we believe that the risk-benefit profile of abracitinib is going to have a role in the treatment of atopic dermatitis patients. And it will be a welcomed addition, you know, and an additional option that patients really need. And then coming back to Xeljanz, you had a question about our EU label. So actually, the changes to the EU label were published in June, although we're still waiting for the final SMPC.

Peter.

And I will say that if all our biosimilar portfolio and we see of today in the since we've made the pivot and 2 of that peer play set of innovation at the end of.

<unk> focus in our pipeline.

And we are really now looking at that Biosimilar portfolio of easily.

The other investments and breakthrough therapies that we have to make the of course, we will continue to look for opportunities fabrics at the point, it's going to be more opportunistic.

And that and we are really looking at our investments in our development program.

Good day, and TBD to be competitive entity.

Sure that we have.

Angela Hwang: And there, the label is really looking at a cautionary note for those who are 65 or older, who are smokers, or have malignancy risk. And the warning there is for physicians to consider alternative therapies prior to using Xeljanz. And so I think this is pretty consistent with how Xeljanz is being used today. If you look at where the utilization is, more than half of our business is in third-line treatment, which is after the use of other treatments like biologics. So again, I think we'll wait to see how this plays out. But the fact that it is being recommended for third-line treatment is very consistent with how it's being used.

Ability to focus on breakthrough therapies. So I'd say that you know going forward it will be more opportunistic because we're just weighing in trading at so many of incredible programs on the innovative side that we could also be doing.

Thank you Angela and both of them you may think breaking towards the rest of Orleans look.

We have read them all so much.

<unk> substrates in our R&D pipeline and so much opportunity to invest.

The rationale.

The rationale we are clearly focusing on the.

The first in class ER.

And particularly the best in class first in class and so there are some of my right. So that's why R&D budget is increasing so thank you very much.

But of your bridge.

Thank you Albert Operator next question please.

Your next question comes from Jeff Meacham from Bank of America.

Operator: Your next question comes from Ronnie Gale from Bernstein.

Operator: Good morning, and thank you for taking my questions. The first one will also be on the boosters. I fully understand this point around the third dose increasing antibodies significantly. The counterpoint that has been raised is that the third dose is not needed because while antibodies wane, immunity against severe disease is not, or at least has not so far waned over time. Can you discuss a little bit how you see the waning of immunity in the large public and the elderly as you're seeing it for your vaccine, even if antibodies don't wane?

Jeff.

Good morning, guys. Thanks for the question.

Just have 2 for Michael on until the boosters. When you look at the new cases of the Delta variant.

Of the protection varies quite a bit and vaccinate individuals' really depending on geographies around the world. So all of our their common themes that you've identified that could explain this and what can you say about the T cell dynamics from the vaccine overtime and then second question for Albert or for Frank you just given the.

Operator: The second question is run by a similar business. This is something you highlighted. We're not really seeing a lot in the pipeline or the clinically available pipeline for you from a similar business beyond

Hike from the Covid vaccine does this change pfizer's urgency.

Or size of your capital allocation decisions I would think that this would give you maybe more deal capacity.

Operator: The Humira Bisimilars. Can you discuss your plans for that business? Is this still the emphasis for

Operator: Is this still the emphasis for Pfizer, or are you de-emphasizing it?

Over the low period at the end at the end of the decade. Thank you.

Operator: Thank you, Ronnie. Michael, again, I think I will ask you to make comments on whether we see waning of immunity also in severe disease or in hospitalizations, and we have seen data about that. Yeah, thank you, Albert. It's a very good question.

Okay.

Thank you very much let me start with ER without some sort of frankly.

So the same as the second 1.

All of the service charges and ER.

This extra cash flows do not changed neither of our strategic direction.

Michael Dolsten: So first, we do see a more rapid waning concerning infections and mild to moderate symptoms. Those are likely entirely or to a large degree dependent on antibodies, and the dropping titer that we alluded to, if you raise it, may have a good probability of reverse that waning. Fortunately, and The protection against severe disease, hospitalization, and fatal outcome remains pretty high, but we do see some lowering, particularly in real-world evidence studies from Israel, we see some lowering in that protection, in risk groups such as older adults, and immunocompromised.

Not materially our ability to performance of the upscale but give us better flexibility.

And we plan to allocate capital.

The to.

Develop the business.

The very big Central Texas.

Now in the Covid boost or send your question about the why.

Why are we see differences around the.

ER geographies seem hard to accurately as Michael.

The explain in a moment of the date of the whole.

All geographies are consistent per take into consideration the time element, but the Michael Baker, Yeah, Yeah, you said, it very well Albert.

We first get the gleaned from the real world evidence in Israel, giving the very rapid messy of vaccination that did.

Over.

Over basically January to March and January started with all your at all and those moving vulnerable day in all of 6.8 months and they have a large number of them. So that's why they see.

Michael Dolsten: That's likely because, in addition to antibodies, T-cells help out in keeping up strong defense against severe disease which is later in the infection process, and particularly when antibodies have waned, but the slow but still noticeable gradual decline in protection also against CV disease is something that's on our eyes, and certainly, we believe that by boosting you may strengthen antibodies and T-cells, and you have an early warning signals whether to do that with some modest All in all, I think a third dose would... strongly improve protection against infection, mild-moderate disease, and reduce the spread of the virus, but also give you some extra muscle and reverse the slower decline against severe disease. So this is how we're looking at it from multiple angles in order to describe the full opportunity with boost. Thank you, Michael and Xeljanz.

The vaccine waning and that's why they also communicated about the consideration for us.

So it does other countries that started later.

And amping up the rollout of slower.

Wil and <unk>.

Are starting to see similar trends.

Representing what you still saw in June and we all getting those reports which tells us.

We are increasingly.

Oh, sorry, the that's what we have learned from Israel is likely to be a similar direction in many other places of course, we need to get all of that data in order to be fully clear about this but the trends look similar find.

As of yet there is also an element that some countries, particularly U K extended into the wall between dose 122 of longer interval, all likely they will get a bit more long lasting protection and dirty at the May come a few months later.

Angela Hwang: Thanks for the question on the BioSIMs, and certainly we've been so pleased with the tremendous growth that we've seen in this area and the deep utilization of our BioSIMs. I will say that for our biosimilar portfolio and where we see it today, since we've made this pivot to a pure play innovation focus in our pipeline, we are really now looking at that biosimilar portfolio vis-a-vis other investments in breakthrough therapies that we have to make.

Finally the.

This advantage of extending the range between those 1 and 2 is that you expose all of the dose 1 many individuals through of high risk of infection.

You do gain likely.

Somewhat extended protection. So that these are 2 examples.

You know when you started to vaccinate.

At the time difference between those 1 and 2 and finally, they may be of course some difference.

In per day.

Angela Hwang: Of course, we will continue to look for opportunities, but I would say at this point that it's going to be more opportunistic and that we're really looking at our investments in our development program to be competitive and to make sure that we have the ability to focus on breakthrough therapies. So I'd say that, you know, going forward, we will be more opportunistic because we're just weighing and trading off so many incredible programs on the innovative side that we could also be doing.

All of these type of the.

Diseases in different countries, but all in all we expect it to look somewhat.

The MLR in its direction.

And just to clarify when Michael sales extended because of the spread of the first between the second 1 is not that they will get more out of the secondary piece of of the real protection of stocks later.

From the second the Dolphin. This is the case that the most of the day.

In the U K for example.

The 1 to 3 months and most of all the data and user of our women receive visa Inc.

The 6 months and most of the case of happening and which have also visibility to all of this data, including some data of a forming here in the U S. But the trend is the same point of view from the same direction.

Albert Bourla: And also, you need to take into consideration that we have right now so much substrate in our R&D pipeline and so much opportunity to invest, but right now, we are clearly focusing on first-in-class and, particularly, best-in-class first-in-class, and there are so many right, so that's why our MD budget is increasing. So, thank you very much. Back to you, Chris.

But you have very good protection in the beginning then there's the waning when you come closer to the 6 months, which is even more profound with delta and the waning. It is mainly for is more profound.

For mild cases, but there is a clear are waning also.

Authorizations and severe diseases, what used to be under percentage of the first months now is coming to the low 90 day span the cases to the 8 so that's the difference.

And between the different geographies.

Christopher Stevo: Thank you, Albert. Operator, next question, please.

Time element you will see very.

The actual impressive consistence.

Okay, Chris back to you.

Thank you Albert Sylvia next question. Please.

Operator: Your next question comes from Jeff Meacham from Bank of America.

Your next question comes from Andrew Baum from Citi.

Operator: Morning, guys. Thanks for the question. I just have to ask it for Michael.

Many thanks.

Firstly in relation to prep in the 'twenty could.

Operator: On COVID boosters, when you look at the new cases of the Delta variant, protection varies quite a bit in vaccinated individuals, really depending on geographies around the world. So are there common themes that you've identified that could explain this? And what can you say about the T-cell dynamics from the vaccine over time? And then second question.

Could you talk to how you expect that to address the current recommendation.

For the Pneumovax is that drop given the type.

The types, which you are not addressing with our partner <unk>.

The second you commented on the.

The number of the other vaccine you didn't comment on you will see the fish Lake candidate flat the primary endpoint is.

Rapidly approaching could you just comment on the OLED.

Operator: for Albert or for Frank.

The degree of optimism or not for that vaccine and then finally in relation to the patient assistant program. The eye brands just looking at the script trends the the vignette, that's hi, Brent the Kitty and the disconnect that it could be due to the the patient assistance programs, but it would be helpful to know the Mac the huge of which.

Operator: You've just given the guidance hike from the COVID vaccine. Does this change Pfizer's urgency or size of your capital allocation decisions? I would think that this would give you maybe more deal capacity to get over the LOE period at the end of the decade. Thank you. Thank you very much.

Albert Bourla: Let me start with that. I'm sure Frank would say the same about the second one. We always have this urge, and these extra cash inflows do not change our strategic direction or materially affect our ability to make these deals. Clearly, it gives us better flexibility. And we plan to allocate capital to develop the business with a very big sense of urgency.

The P. A P contributes and how that has changed over the last 6 months of site. Many thanks.

Thank you Michael do you want to take first the question you didn't speak about.

I think it will see desktop you referred to.

Yeah Yeah.

All right.

Why do you do the.

Well we had.

Hard to reach pipeline.

And we thought that the.

We wanted to allow you to have question 2 I don't see too much ourselves with select the 8 assets are where we thought you are.

Albert Bourla: Now, the COVID boosters and your question about why we see differences between the geographies. In fact, actually, as Michael will explain in a moment, the data from all geographies are consistent if you take into consideration the time element. But Michael, please take it.

We wanted to have some update.

If we continue with the trial we passed the 1.

The review that had the 30 cases, and we are coming now to case numbers that are more of.

Tom.

The ball that you would expect to be able to relatively soon.

Michael Dolsten: Yeah, you said it very well, Albert. We first get a glimpse of this from real-world evidence in Israel, giving the very rapid, massive vaccination they did from basically January to March, and January started with older adults and those most vulnerable. They are now six to eight months old, and they have a large number of them, so that's why they see the vaccine waning, and that's why they also communicate about their consideration for a third dose.

Hello.

If an opportunity to determine if vaccine efficacy is robust.

And you will be able to have a readout.

We are expecting this fall to have another read out and that's why all.

Pending events, but the suddenly I.

Continue to believe it's a very well the sign vaccine that is precedent with antibodies if you neutralize the toxins.

Michael Dolsten: Other countries that started later and amped up their rollout slower will and are starting to see similar trends representing what Israel saw in June, and we are getting those reports, which tells us we are increasingly certain that what we have learned from Israel is likely to be a similar direction in many other places. Of course, we need to get all of that data in order to be fully clear about this, but the trends look similar.

So I continue to say you know the patient.

We continue to mature the start the and I do hope it will have an encouraging.

The out but like in any clinical study you can never be.

The fully so often about the outcome, but I remain very encouraged and optimistic myself.

So thank you Michael into the resorts to clarify it's not the there was something behind it it is the way to select.

Michael Dolsten: Finally, there is also an element that some countries, particularly the UK, extended the interval between dose one and two to a longer interval. Likely, they will get a bit more long-lasting protection, and their data may come a few months later. The disadvantage of extending the range between dose one and two is that you expose, after dose one, many individuals to a high risk of reinfection, but you do gain likely somewhat extended protection. So, these are two examples.

And we are.

The few assets that we could present new data.

Angela Please state the question about the Pneumovax, if what do you think of ACI people do and the.

The program of iphones the profit growth.

Sure.

The question of Pneumovax is something that we can read.

Q and in the ACI P discussion that we've had recently.

Again comes back to the policy questions that were polled and clearly there yeah.

Just 2 of them to reinforce what I said earlier, which was that they were different policy question first of all <unk> 'twenty as well as 1 of 15.

Michael Dolsten: When you start to vaccinate, the time difference between doses one and two, and finally, there may be, of course, some difference in care for this type of disease in different countries. But all in all, we expect it to look somewhat similar in its direction. And just to clarify, when Michael says extend it because they spread the first between the second, it's not that they would get more after the second.

The.

The other question of whether a 50 plus we'd be vaccinated with probably the only 4 P. C V 'twenty and specifically your question about a new low back that is being evaluated only with net 15 knock with PCB in 'twenty or with any PCB. So again different policy questions Andy.

The Pacific to the each each pneumococcal vaccine.

And then going to your question about the pack.

Albert Bourla: It is that the real protection starts later from the second dose. This is the case that most of the data in the UK, for example, are one to three months. And most of the data in Israel, when we see it, is in three to six months. And most of the cases are happening there. And we also have visibility to other data, including some data that are forming here in the US. But the trend is the same. It's pointing in the same direction. But you have very good protection in the beginning.

The Pac usage, you know like.

We are seeing this.

Clearly as a trend that is very much aligned with the economic hardships that we're seeing.

The reason the result of of Covid and the pandemic the.

The Iran. The patient is a younger population and so on that because they're all on commercial insurance.

There economic status has very much been aligned to lot of T appointment and what we've seen throughout the pandemic our 2 things 1.

Is the as a slowdown in new patient starts.

Christopher Stevo: Then there's a waning when you come closer to six months, which is even more profound with Delta. And the waning, it is mainly for, it's more profound for mild cases. But there is a clear waning also for hospitalizations and severe diseases. What used to be 100% in the first months is now coming to the low 90s and, in some cases, to the 80s. So that's the difference between the different geographies. The time element, you will see very, and actually impressive consistency. Okay, Chris, back to you.

Which actually is 1 of the reasons for the.

So that's the for the negative growth that you saw in the eye brands in the U S. In the second and more prominent 1 this quarter is the path. So I think what you're seeing is very consistent with what we're seeing on the and you know in.

The environment generally as it pertains the economic hardship and ER and so that is definitely 1 explanation and then the other explanation would be a slowdown in the new patient starts that we've been seeing as well.

Thanks, John.

So it'll be in the next question. Please.

Your.

Question comes from Carter Gould from Barclays.

Operator: Thank you, Albert. Sylvia, next question, please. Your next question comes from Andrew Baum from Citi.

Good morning, Thanks for taking all the questions and I appreciate all the color of the pipeline for Michael a couple of from Us first.

Operator: Many thanks. Firstly,

Give us the pretty comprehensive set of updates, but in terms of expectations on timing from the pediatric study I don't believe I felt I referenced and just wanted to confirm that the.

Operator: to Prevnar 20. Could you talk about how you expect ACIP to address the current recommendation for Pneumovax?

Operator: Has that dropped given the stereotypes which you are now addressing with Prevnar 20? Second, you commented on a number of your other vaccines. You didn't comment on your C. difficile candidate where the primary endpoint is rapidly approaching. Could you just comment on your relative degree of optimism or not for that vaccine? And then finally, in relation to the patient assistance program for Ibrance, just looking at the script trends for Vasemio versus Ibrance, there's clearly a disconnect there. It could be due to the patient assistance programs, but it would be helpful to know the magnitude of which the PAP contributes and how that has changed over the last six months or so.

Your next question asks from FDA haven't pushed timelines back there and then as we can.

About the oral Proteasome inhibitor clearly of moved very fast there can you comment just around your ability to supply the the market and invoke sort of off the.

Out of the gates, assuming the timelines are tracking kind of out of your messaging.

The reason I apologize if you guys addressed this already but it seems like 1 of the things you guys do control is on the on the on the Jack side is the potential presentation of the JAK or all surveillance data.

Any color on when we might see that presented at the medical meeting. Thank you.

Yes, let me take quickly the the first 2 and then the for the Doctor Michael.

And then what would be your kind of usage, the but the ASIC side.

Operator: Many thanks. Thank you. Michael, do you want to take this question first that you didn't speak about? I think it was CDEF that you referred to. Are you looking confident about why you did that?

We are all of them.

As you.

You said as we have said we are projecting the into September kind of all immediately after some of the bigger but EBITDA is us.

Some of requirements and we are looking at them all.

Michael Dolsten: Well, we had such a rich pipeline, and we thought that we wanted to allow you to have questions too and not speak too much ourselves. So we selected eight assets where we thought you would like to hear some updates. CDF, we continue with the trial. We passed one review that had 30 cases, and we're coming now to case numbers that are more.

In.

Michael the needs to try to true even if all of these requirements to try to Tom.

At the same timeframe. So we're not changing the rise in our expectations of the windows side of it can recruit with us if we need to do more in the last time, we will try to glaucoma. The you've got so that's the first 1 on the oral of supply all the oral.

In terms of the supply as you know this is not.

<unk>.

The compound.

We've seen clinical efficacy data yet so the risk is higher than the industry, but of course okay.

Michael Dolsten: It's feasible that you would expect to, relatively soon, have an opportunity to determine if vaccine efficacy is robust, and you will be able to have a readout. We are expecting this fall to have another readout in that file pending events, but certainly I continue to believe it's a very well-designed vaccine. There is precedent with antibodies if you neutralize those toxins.

Diseases of moving so <unk> have also arise our team.

All right to invest in manufacturing as the risk.

Significant quantities of the oral so ER.

If we are successful we will have.

Have a quality was 1 of the world as much as possible that's the.

The significant investment that we're doing at risk it could go all the way too.

The $1 billion.

The including some of the research working with this company.

So, but I think it is the right thing to do.

Michael Dolsten: So I continue to say, you know, be patient. We continue to mature the study, and I do hope it will have an encouraging readout. But like in any clinical study, you can never be fully certain about the outcome, but I remain very encouraged and optimistic myself. So thank you, Michael and Andrew. Just to clarify, it's not that there was something behind it. It is that we had to select a few assets that we could present new data. Angela, please take the question about the new MOVAX, what you think ACIP will do, and the program for Ibrance, the PAP program.

I gave them the green light there should not be thinking about the cost right. Now this should be thinking about the success of all the oral program.

And then for the.

The exact Michael.

I mean do you know when the study was.

We'll be published.

All the results you know we have poker to share.

All of the day, it's all of the studies obtain this fall with regulators.

And ER, that's you know conclusions have already been posted.

The about the date the.

The from both European and like the prep commit the.

Yes.

So while there isn't the date yet when the study will be.

Published.

Our regulators have had access to it and have made updates.

So.

I think the most critical element is for the U S ER.

European regulate to finalize things and ER.

Angela Hwang: Well, the question of Pneumovax is something that we can refer to in the ACIP discussion that was recently had. Again, it comes back to the policy questions that were posed, and clearly there, just to reinforce what I said earlier, which was that there were different policy questions posed for both PCV20 as well as MERS-15. The question of whether 50-plus would be vaccinated was posed only for PCV20. And specifically, your question about Pneumovax, that is being evaluated only with MERS-15, not with PCV20 or with any PCV.

The annualized spoke to that will give the clarity to the class of Jack the salyards in which patients with treatment lines the benefit.

Most and.

As you know in addition to the study we have years of 10 years all of a survey.

And we continue to share all of that day.

As the study was.

Mainly in the subset of patients with increased H and cardiovascular risks.

Well of course, our civilian.

Currently all Italians patient and we have continued to shed those are robust data.

Angela Hwang: So again, different policy questions and very specific to each, you know, each pneumococcal vaccine. And then going to your question about the PAP, the PAP usage, we are seeing this clearly as a trend that is very much aligned with the economic hardships that we're seeing, you know, as a result of COVID and the pandemic. The Ibrance patient is a younger population.

Yes.

Thank you.

Okay.

Thank you Albert.

Operator next question please.

Your next question comes from Jeff.

If reported is from SVP leerink.

Thank you very much for taking the question of Michael 1.1 for you you mentioned the gel surplus Dalian, which of course has picked up the careful of 17 and mutation.

How concerned are you about delta plus and then instead of the possibility.

Failure.

That of course, it will pick up the 44 kind of and then be even more.

The assistance of vaccine Houston here of the relative to that.

Angela Hwang: And so, and because they're on commercial insurance, their economic status is very much aligned to employment. And what we've seen throughout the pandemic are two things. One is the slowdown in new patient starts, which actually is one of the reasons for the negative growth that you saw in Ibrance in the U.S. And the second and more prominent one this quarter is the PAP. So I think what you're seeing here is very consistent with what we're seeing in the, you know, in the environment generally as it pertains to economic hardships. And so that is definitely one explanation. And then the other explanation would be a slowdown in the new patient starts that we've been seeing as well.

Do you have the view yet as to.

Whether the best through the strategy is the original Wuhan the strain the beta the strength of the Delta strength Delta plus strength.

And then lastly have you contemplated.

Heterologous boosting with you all vaccine. After for example, the Charles vaccine or vice versa is that something of your stomach.

Michael.

Yeah.

All thing with the.

The.

Delta plus so right now Delta is the various state virus and continue to impact the ilmenite. It's too early to know what the end of the current Delta plus will have transmission of sufficiency to out compete delta.

When we say plus it means yes.

Senior 2 of monitoring to the future.

At some time point, whether takes the 12 months there all day.

Operator: There will be a next question, please.

Likely going to be strains that pick up additional mutations but.

Operator: Your next question comes from Carter Gould from Barclays.

The state also fit me.

Operator: Good morning. Thanks for taking all the questions, and I appreciate all the color on the pipeline from Michael. A couple from us. First,

Meanwhile, what we have seen with the wife epics. The <unk> is that we see of for each does not.

Not just of higher magnitude of event the body, but the breath the.

Operator: Can you give us a pretty comprehensive set of updates, but in terms of expectations for timing from the pediatric study...

The repertoire of different sales producing antibodies grows and grows so you seem to cover with the increasing does more very young.

Operator: I don't believe I saw that referenced and just wanted to confirm.

If you go back and look at the slides we use the faith of oriented as an example, there was somewhat of a difference of the dose to harder to utilize the debate the varian off the dose through 3 easier to neutralize the faith of our young so that's why we had this for free.

Operator: The recent asks from FDA haven't [inaudible] And then, apologies if you guys addressed this already, but it seems like one of the things you guys do control is, on the JAK side, the potential presentation of the JAK oral surveillance data. Any color on when we might see that presented at a medical meeting? Yes, let me take quickly the first two and then for Jack and Michael, maybe you can see.

The Wifi booze very useful for existing and new variant now as all of the test said before we always wanted to be prepared for the unexpected.

And we continue to prepare delta and Delta plus 3.

Operator: The pediatric study, we are, as you said, as we have said, we are projecting in the September timeframe, immediately after summer, to be due. But FDA has asked for some requirements, and we are looking at them. But our intention is to try to, even with these requirements, to come in the same timeframe. So we are not changing our expectations as to when the study can recruit. We just, if we need to do more in less time, we will try to accommodate that. So that's the first one.

But right now we do think that the Wildcat, Betsy and it's going to be a very efficient.

But we always want to be ahead of the curve I think the way to win this game is to keep up high immunity reduce the amount of virus and that's why we do both.

We we study boost with existing and all prepared if ever needed.

To have an updated if the virus can be feet and breaks through immunity. Finally end of on the hits all of his booze the art files coming out perform for example in UK that showed favorable outcome for those that vaccinated with the extra scenic ER on.

Albert Bourla: On the oral supply, on the oral..., and the supply. As you know, this is not a compound that we have seen clinical efficacy data for yet. So the risk is clearly higher than anything else. But, of course, the disease is moving.

On getting an M on a booze such as we the fights of Bionetic, which day use.

Albert Bourla: So I have authorized our team to invest in manufacturing significant quantities of the oral so that if we are successful, we will have quantities for the world as much as possible. That's a significant investment that we are making. At risk, it could go all the way to to a billion, including some of the research work that is happening. So, I think it is the right thing to do. And I gave them the green light. They should not be thinking about cost right now.

Those are dates that you should review and I'm sure of patients and physicians are the envoy. The relative concludes I know there is in U S. A similar study is to benefit from the mrna vaccines can be given repeatedly while Ed and a virus delivered vaccine has limitations the full repeat.

Hughes.

Thank you Michael and then begins after.

I wanted to make a transfer sorry, our strikers of when these countries of you take no chances you. This is too serious.

To to read.

Albert Bourla: They should be thinking about the success of the oral program. And then for the DAC, Michael, do you know when the study will be published, or the results? You know, we have focused on sharing all the data of the study obtained so far with regulators. And as you know, conclusions have already been published about the data from both European countries, like the Prague Committee, and the US. So while there isn't a date yet when the study will be published... Regulators have had access to it and have made updates. So I think the most critical element is for US and European regulators to finalize things.

So when we have a very young but the piece of can share all the fish, we make immediately of <unk>.

Ever since the dry we trust I wish I got was the.

But of course.

Seem very aggressive so we start the when you give us the names we have the election right now we're going to submit it to review of the <unk>.

Eventually we don't need it was very clear of the of course after we the exact date of all of them you know the initiative I don't really go to the South Africa.

100 per cent efficacy and the better of smaller numbers of Amazon.

So we noticed the Omega, but we thrive the saying we do not we'll go with the it looks like you love movies, where everything that we see so far but we have developing 1 of them. The in the box space. So in case something goes wrong, because biology is sometimes unpredictable we will not have to wait 3 months before this is all the time.

Michael Dolsten: And like Angela spoke to, that will give clarity to the class of JAK and to Xeljanz and which patients with treatment lines benefit most. And as you know, in addition to the study, we have years, 10 years of surveillance. And we continue to share all of that data, as the study was mainly in a subset of patients with increased age and cardiovascular risk. But, of course, our surveillance covers all Xeljanz patients, and we have continued to share those robust data. Thank you, Albert. Operator, next question, please.

Right now from the day, we we assign of.

As a veteran of concern in our own interpretations, we take 95 days, we'll be able to have electric so that's why we all.

Always strive to be a heck of all of the card.

Too serious of initiate the bakers, but could you. Please [laughter].

Thank you all first so the the next question please.

Your next question comes from Louise Chen from cancel or.

Hi, Thanks for taking my questions. So the first question I have free is do you think a full BLA approval would actually increase vaccination rates and do you think you might be that as early as of this year and then secondly, how receptive do you think you S regulators Archer booster shot we see a lot of conflicting headlines of just curious what you of discussions of sounded like.

Operator: Your next question comes from Jeffrey Porges from SVP LeRinc.

Operator: Thank you very much for taking the question. Michael, one for you.

Operator: You mentioned the Delta Plus variant, which, of course, has picked up the K417N mutation. How concerned are you about Delta Plus? And then is there the possibility that, of course, it'll pick up E484K and then be even more resistant to vaccine-induced immunity? And relative to that, do you have a view yet as to whether the best booster strategy is the original Wuhan strain, the Beta strain, the Delta strain, or the Delta Plus strain? And then lastly, have you contemplated boosting your vaccine after, for example, the Chavis vaccine or vice versa?

There and then lastly, your R. S V vaccine you should of 100 per cent efficacy rate. So just curious if you could elaborate more of that market opportunity for you and how big that market is in terms of sales and other metrics. Thank you.

Mmm, Yes, all day.

The nation rates the Louis from from what I see and what we see all the different polls from people that they are reluctant it seems about the visual player all some people.

The change the reluctance shih-tzu willingness the good luck she made it even of actually could get to this level and the in terms of of the timelines again I believe you 2 of the day I know that the the the proceeds.

Michael Dolsten: Yeah, you know, starting with Delta Plus. So right now, Delta is the very fifth virus and continues to infect and dominate. It's too early to know where the end of the current Delta Plus will have sufficient transmission to outcompete Delta.

Of course, the that about the per yard.

The second how receptive regulators all.

On the on the surf the dose of I think the regulators on the subject or not to date.

And they need to see the flow of packets of data once they see if they have to to speak. So I don't want to make comments about that and all of this week, which is the clearly.

Michael Dolsten: So when we say plus, it means yes, continue to monitor into the future. At some time point, whether 6 to 12 months, there are likely going to be strains that pick up additional mutations but stay also fit. Meanwhile, what we have seen with the wild-type vaccine is that we see for each dose not just a higher magnitude of antibody, but breadth. The repertoire of different self-producing antibodies grows and grows, so you seem to cover, with increasing doses, more variants. If you go back and look at the slides, we used the beta variant as an example.

Very very logical acuity, whether it was growing even more because of the we see that the VP I mean all of the.

This.

Is ER getting more and more I will ask Michael will give us some color.

Yeah, you know we are.

Very excited about the date, the and the opportunity for an R. S V I don't like the.

There are hundreds of thousands of cases and the per year in the U S and the of particular of course difficult for an older at all above fix the or add all set have underlying conditions, where the chronic lung disease or.

Michael Dolsten: There was somewhat of a difference after dose two; harder to neutralize the beta variant. After dose three, it was easier to neutralize the beta variant. So that's why we have so far found the wild-type boost very useful for existing and new variants, and we continue to prepare Delta and Delta Plus strains. But right now, we do think that the wild-type vaccine is going to be very efficient. But we always want to be ahead of the curve. I think the way to win this game is to keep up high immunity, and reduce the number of errors. And that's why we do both.

The immune compromised.

Now, they're all actually up to 15000 deaths just in the U S. N yearly so it's not just about the difficulty seized all our fight the outcome.

So we think there is a very large of opportunity now with all of the vaccine to the best of all our knowledge. It's the only vaccine in late clinical trial, if the target or S. B a N b W.

Pretty it sort of cold at the a and B stop group very all likely of.

All seem a lot of quantity of circulate the some yes, 1 is larger than the other of some yet the equal of so we cover all of the available RSV of protection by of Bivalent vaccine if shown successful and the fine on the 30th.

Michael Dolsten: We will start a boost with existing and are prepared, if ever needed, to have an updated if the virus can be fit and breaks through immunity. Finally, and on the petrologist boost, there are trials coming out performed, for example, in the UK that showed favorable outcomes for those that vaccinated with AstraZeneca on getting an mRNA boost, such as with the Pfizer BioNTech, which they use. Those are data that you should review, and I'm sure patients and physicians will envoy their own.

Also I wanted to make it clear that.

When you look at the date of <unk> hour of the shell and study of of the very prominent 100 per cent.

The picture they'll all of our benchmark published and please have a look from them I dunno virus that it's all so now in the advanced income trial, which showed in the very same old the old pursued by the very same UK Institute all.

Angela Hwang: I know there is in the US a similar study to benefit from that mRNA vaccines can be given repeatedly while adenovirus-delivered vaccine has limitations for repeat use. Thank you, Michael. And again, Jeff, I want to emphasize that our strategy when it comes is that we take no chances here. This is too serious, too risky.

All 4 of the response around 50 per cent.

So we think we have a potent vaccine we have of wealth tolerate that end of unique aspect of covering both trains you'll have some cross the activity between the strain, but not the school.

The texture and unless you have both.

The parts for the a and the beef strain Angela anything you want the shed light on how you can watch all the C DS.

Yeah, and I think Michael and maybe just to reinforce what Michael said, which is that they all hundreds of thousands of all of that.

Albert Bourla: So when we have a variant that is of concern, we always make an immediately at risk a vaccine to try. The first time we had that was Beta. That seemed very aggressive.

And tens of thousands of deaths each year. In fact this is the second leading cause of a respiratory illness. Following flu. So we think that we have a great opportunity to the in fact, the amount of pick market because it is quite diagnose today of under reported.

Albert Bourla: So we started doing the vaccine, and we have a vaccine right now. We are going to submit it to the FDA. Eventually, we won't need it. It was very clear because after we did that, we got data for immunogenicity, but we also got the South African study that gave 100% efficacy in the Beta, or smaller numbers, but 100% efficacy. So we know we don't need it, but we try. The same as we do now with Delta.

Think of it really in the sweet spot of what we do with adult vaccination and that and of the seasonal vaccinations switching I'd go out without a patent all franchise. So all in all at tremendous anti exciting commercial opportunity.

Think of the ball as you can see it.

The excitement to 2 of both of them all and Michael into the I said of of the saying both for the.

Albert Bourla: It looks like we will not need it with everything that we see so far, but we are developing one in the back stage. So in case something goes wrong, because biology is sometimes unpredictable, we will not have to wait three months because this is our time right now. From the day we assign a variant as a variant of concern in our own interpretations, we take 95 days to be able to have a vaccine. So that's why we always try to be ahead of the curve, but this is too serious of an issue to take risks. Back to you, Chris.

The size of the unmet medical needs right now, but also for the capabilities of what looks like a very effective vaccine remains to be moving with a face. The described about the we are going to execute with the same speed as we are doing lately all of us and sauce.

Back to you please.

Thank you all for it Uhm Silvia, we're just over time, but maybe we could do 1 very brief question. Please.

The next question comes from the line of parents learn from Goldman Sachs.

Hi, Thanks for taking the question maybe I just had a 2 part of the first I'm. Just wondering if you can provide the latest point estimate on your vaccine efficacy from the phase 3 trial I think you gave us that number back in April of those around 91 per cent and just wondering if there's been any severe cases in the vaccinated cohort and then on pregnant.

Christopher Stevo: Thank you, Alfred. Will there be another question, please? Your next question comes from Louise Chen from Kantor. Hi, thanks for taking my questions. So the first question I have for you is, do you think a full BLA approval would actually increase vaccination rates? And do you think you might see that as early as this?

The 20, how are you thinking about that in the context of your longterm guidance cannot actually grow your prep in our franchise significantly in any more detail you can provide their thank you so much.

Operator: Your next question comes from Louise Chen from Kantor.

Operator: Yes, on the vaccination rates, Luis, from what I see and what we see in the different polls from people who say they are reluctant, it seems that this will play a role. Some people will change their reluctancy to willingness to get vaccinated if the vaccine gets full approval. And in terms of the timelines, again, I leave it to FDA; I know that they proceed above the priority. Regarding how receptive regulators are on a third dose, I think regulators are receptive or not to data.

Michael It was I think 92 per cent of can you comment on the latest estimate the N do for 15, Andy Griffith.

Yeah, you know what would the is is the phase free trial that will be very.

Very soon published on Med archive and it will appear in the top peer reviewed John all the please check in on Med archive to to get the tells it may be up any day. This week you know it's covered up to 6 months first 2 months and 96 per cent protection.

ER then above 90 is between the buns, 2 and 4 and then about 80.328 to 4 per cent.

Operator: And they need to see the full packets of data. Once they see it, they have to speak. So I don't want to make comments about that. And RSV, which is clearly a very, very large opportunity, but it is growing even more because we see that the epidemiology of the disease is getting more and more hot. I will ask Michael to give us some color here.

The months 4 to 6 we have retained during that period very high protection against severe disease and hospitalization.

Thank you and the micro in the excuse me and the amount of about the pregnant you things you can grow it I'm asking you to do it in the the whether you think.

Albert Bourla: Yeah, you know, we are very excited about the data and opportunity for an RSV adult. There are hundreds of thousands of cases per year in the US, and they are particularly, of course, difficult for older adults above 60 or adults that have underlying conditions, whether chronic lung diseases or immune compromise. Now there are actually up to 15,000 deaths just in the U.S. annually, so it's not just about a difficult disease or a fatal outcome.

[laughter] well I think again it comes back of the policy questions that have been posed already by the the IP, which will be discussed and I'm kind of that.

Today, the really to up there too if your questions being posed the rocket Frank 2 of what we have with kind of not that came today, which is number 1 the ability of should we or should we not be vaccinating does it kind of 50 Black and then secondly, immuno compromised 18, 49 or 18 to 59.

Albert Bourla: So we think there is a very large opportunity. Now with our vaccine, to the best of our knowledge, it's the only vaccine in late clinical trials that targets RSV A and B subgroups. Please recall that the A and B subgroup variants are likely of similar quantities circulating. Some years one is larger than the other, some years they are...

Both of those populations are different to what we have the tech team. So we we are I'm engaging and and and.

And we will be engaging at the AC IP all court discussing our data with with the with the.

Relic income Decisionmaker can stakeholders and sharing of information and we hope to have a positive outcome at the end of it the IP, but honestly. This is is this all could be discussed and I think I'm a little too early to speculate what can happen. So we need to have that wrote that down.

Michael Dolsten: So we cover all of the available RSC protection by a bivalent vaccine if it is shown successful in the final studies. Also, I wanted to make it clear that when you look at the data in our challenge study of very prominent protection, there are benchmarks published, and please have a look at the adenovirus that is also now in advanced clinical trials, which showed in the very same model pursued by the very same UK Institute, half of the response, around 50%.

The really understand what Ian opportunity 9.

Okay, Angela we will give you sometime soon.

The growing so we thought I think we've come to the end. Thank you for joining us the day for your continued the engagement with Pfizer of who we really appreciate that very low.

1 of these engagement our experienced with the coffee can I give up it seems like both of US a great deal about what the possible.

What the impossible and most of things are fast so most notably at the store does that we can drive step changes Pfizer, Nebraska incremental savings.

Michael Dolsten: So we think we have a potent vaccine. We have a well-tolerated vaccine, and the unique aspect of covering both strains. You have some cross-reactivity between the strains, but not as good protection unless you have both parts for the A and the B strains. Angela, anything you want to shed light on how you commercially see this?

To keep you updated on the progress we are making in R&D. We will of course the mix focusing version of a day later of this year date will be announced soon for this event of the size of the box systems will provide the an update on all of the vaccine pipeline progress, including our plans to continue with fancy are cutting edge science, so serious as an M.

Angela Hwang: Yeah, no, thanks, Michael. And maybe just to reinforce what Michael said, which is that there are hundreds of thousands of older adults that are hospitalized and tens of thousands of deaths each year. In fact, this is the second leading cause of respiratory illness following flu, so we think that we have a great opportunity to develop this market because it is quite underdiagnosed today and underreported. And, frankly, it's really in the sweet spot of what we do with adult vaccinations and also seasonal vaccinations, which go well with our Prevnar franchise. So, all in all, a tremendous and exciting commercial opportunity.

RMA programs for Covid mine, too and flew as well as the Orange weird of such programs for both of them a fair amount of those indications and other mrna vaccines, but we are working on before we close I want to once again, Frank talk to them.

So all sorts of as many contributions to Pfizer and folk successfully elevating are in the rest of the relation of function the best in class. So.

To you out of Prospero.

And on behalf of all Pfizer colleagues I wish you and your family all of the best in the next chapter of your life.

Albert Bourla: Thank you to both. As you can see, there is a lot of excitement for both Angela and Michael, and I share it, both for the size of the unmet medical need right now, but also for the capabilities of what looks like a very effective vaccine that remains to be proven with a phase 3 study that we are going to execute with the same speed as we are doing lately with our vaccine studies. Back to you, Chris.

Chuck is leaving behind some big so just the field, which is why are you are thrilled the receiver has decided that the joined the Pfizer of theme Chris joins us from the all extra them pharmaceuticals in Boston, where he was vice president and heads of Investor Relations. He brings a wealth of experience is the by size on the list and.

The amount of as well as of strong network of relationships across the investment of communion.

The deep knowledge of.

The health care industry would be a great asset as we continue to advance or in the face of pipeline to deliver breakthrough therapies and vaccines basins in the long term value to shareholders without I were brings our quote of clothes. Thank you for joining us have a great. The rest of of your day.

Christopher Stevo: Thank you, Albert. Sylvia, we're just over time, but maybe we could do one very brief question, please.

Operator: Your next question comes from the line of Terrence Flynn from Goldman Sachs.

Operator: Hi, thanks for taking the question. Maybe I just had a two-parter first; just wondering if you could provide the latest point estimate on your vaccine efficacy from the phase three trial. I think you gave us that number back in April. It was around 91%. And just wondering if there've been any severe cases in the vaccinated cohort, and then on Prevnar 20, how are you thinking about that in the context of your long-term guidance? Can that actually grow your Prevnar franchise significantly in any more detail you can provide there? Thank you so much.

Ladies and gentlemen. This concludes today's call you may know all disconnect.

[music].

Michael Dolsten: Michael, it was, I think, 92%. Can you comment on the latest estimate and if you have seen any breakthrough? Yeah, you know, this is the phase three trial that will be very soon published on MedArchive, and it will appear in a top peer-reviewed journal. Please check in on MedArchive to get details. It may be up any day this week.

Michael Dolsten: You know, it's covered up to six months. First two months, 96% protection, then above the 90s between months two and four, and then about 83 to 84% between months four and six. We have retained during that period very high protection against severe disease and hospitalization.

Michael Dolsten: Thank you. And Michael, and excuse me, Angela, about the Prevnar, do you think you can draw it? I'm asking you to do it, but what do you think?

Angela Hwang: Well, I think, again, it comes back to the policy questions that have been posed already by the ACIP, which will, you know, be discussed in October. As we've said today, there are really two questions being posed that are different to what we have with PREV-13 today, which is, number one, the ability to vaccinate those that are 50-plus. And then, secondly, those that are immunocompromised, 18-49 or 18-59.

Angela Hwang: Both of those populations are different to what we have with 13. So we, you know, we are engaging and, you know, and we will be engaging at the ACIP, of course, discussing our data with the relevant decision-makers and stakeholders and sharing our information, and we hope to have a positive outcome at the end of ACIP. But honestly, this is all to be discussed, and I think it's a little too early to speculate about what could happen. We need to have a robust scientific discussion to really understand what these opportunities are.

Angela Hwang: Okay Angela, we will give you some time to... So with that, I think we've come to the end. Thank you for joining us today and for your continued engagement with Pfizer. We really appreciate it. We learn a lot from this engagement. Our experience with the COVID-19 vaccine has taught us a great deal about what is possible and what is impossible. And most things are possible.

Albert Bourla: In particular, it has taught us that we can drive step changes at Pfizer, not just incremental changes. To keep you updated on the progress we are making in R&D, we will host our next focused investor update later this year. A date will be announced soon.

Albert Bourla: At this event, the Pfizer vaccine team will provide an update on our vaccine pipeline progress, including our plans to continue advancing our cutting-edge science in such areas as an mRNA program for COVID-19 and flu as well as the RSV research programs for both maternal and adult indications and other mRNA vaccines that we are working on. Before we close, I want to once again thank Dr. Riano. Thanks for his many contributions to Pfizer and for successfully elevating our investor relations function to the best-in-class. Talk to you at a crossroads.

[music].

Albert Bourla: And on behalf of all Pfizer colleagues, I wish you and your family all the best in the next chapter of your life. Chuck is leaving behind some big shoes to fill, which is why you are thrilled that Chris Stivel has decided to join the Pfizer team. Chris joins us from Alexion Pharmaceuticals in Boston, where he was Vice President and Head of Investor Relations. He brings a wealth of experience as a buy-side analyst and portfolio manager, as well as a strong network of relationships across the investment community. His deep knowledge of the healthcare industry will be a great asset as we continue to advance our innovative pipeline to deliver breakthrough therapies and vaccines to patients and long-term value to shareholders.

Albert Bourla: With that, I will bring our call to a close. Thank you for joining us. Have a great rest of your day. Ladies and gentlemen, this concludes today's call. You may now all disconnect.

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