Q4 2021 Eli Lilly and Co Earnings Call

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Operator: Ladies and gentlemen, thank you for standing by and welcome to the Lilly G4 2021 earnings call. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session, and instructions will be given at that time. Should you require assistance during the call, please press star, then zero, and an operator will assist you offline.

Ladies and gentlemen, thank you for standing by and welcome to the Lilly Q4 2021 earnings call. At this time all participants are in a listen only mode. Later, we will conduct a question and answer session and instructions will be given at that time.

Should you require assistance during the call. Please press Star then zero and an operator will assist you offline as a reminder, today's conference is being recorded I would now like to turn the conference over to Vice President of Investor Relations. Kevin Hern. Please go ahead.

Operator: As a reminder, today's conference is being recorded. I would now like to turn the conference over to Vice President of Investment Relations, Kevin Hearn. Please go ahead. Good morning.

Good morning, Thank you for joining us for Eli Lilly and company's Q4, 2021 earnings call I'm, Kevin Hern, Vice President of Investor Relations and joining me on today's call are Dave Ricks, Lilly's Chair and CEO .

Kevin Hearn: Thank you for joining us for Eli Lilly and Company's Q4 2021 earnings call. I'm Kevin Hearn, Vice President of Investor Relations, and joining me on today's call are Dave Ricks, Lilly's Chair and CEO, Anat Ashkenazi, Chief Financial Officer, Dr. Dan Skovronsky, Chief Scientific and Medical Officer, Anne White, President of Lilly Neuroscience, Ilya Yuffa, President of Mike Mason, president of Lilly Diabetes, and Patrik Jonsson, president of Lilly Immunology and Lilly USA.

I'd Ashkenazi Chief Financial Officer, Dr. Danskin, Wronski, Chief scientific and Medical Officer, Anne White, President of Lilly Neuroscience, Oh, Yeah useful president of Lilly International Jake Van Norden CEO of blocks of oncology at Lilly and President of Lilly oncology.

Mike Mason President of Lilly diabetes, and Patrik Jonsson, President of Lilly Immunology and Lilly USA.

Kevin Hearn: We're also joined by Lauren Zierke, Kent Ueha, and Sarah Smith of Investor Relations. During this conference call, we anticipate making projections and forward-looking statements based on our current expectations. However, our actual results could differ materially due to a number of factors, including those listed on slide 3. Additional information concerning factors that could cause actual results to differ materially is contained in our latest Forms 10-K and subsequent Forms 10-Q and 8-K filed with the Securities and Exchange Commission. The information we provide about our products and pipeline is for the benefit of the investment community.

We're also joined by learned Zuercher tend to Asia, and Sarah Smith of the Investor Relations team.

During this conference call, we anticipate making projections and forward looking statements based on our current expectations. Our actual results could differ materially due to a number of factors, including those listed on slide three <unk>.

Additional information concerning factors that could cause actual results to differ materially is contained in our latest forms 10-K, and subsequent forms 10-Q, and 8-K filed with the Securities and Exchange Commission.

The information, we provide about our products and pipeline is for the benefit of the investment community. It is not intended to be promotional and is not sufficient for prescribing decisions as.

Kevin Hearn: It is not intended to be promotional and is not sufficient for prescribing decisions. As we transition to our prepared remarks, please note that our commentary will focus on non-GAAP financial measures. Now, I'll turn the call over to Dave.

As we transition to our prepared remarks. Please note that our commentary will focus on non-GAAP financial measures now I'll turn the call over to Dave.

Dave Ricks: Thanks, Kevin. 2021 was another outstanding year for Lilly, as we delivered strong top and bottom line growth and positive pivotal readouts for five important assets with the potential to launch in the next two years. As we move into 2022, we continue to build on this foundation and are determined to deliver on our long-term outlook to drive top-tier revenue growth, expand operating margins, and innovate to develop and launch new medicines for patients that address significant unmet needs.

Thanks, Kevin 2021 was another outstanding year for Lilly as we delivered strong top and bottom line growth and positive pivotal readouts for five important assets with the potential to launch in the next two years.

As we move into 2022, we continue to build on this foundation and are determined to deliver on our long term outlook to drive top tier revenue growth expand operating margins and innovate to develop and launch new medicines for patients that address significant unmet needs.

Dave Ricks: Unpacking our 2021 performance on slide four, you can see the progress we've made on our strategic deliverables. Q4 revenue was 8% and was driven by volume growth of 11%. However, when excluding revenue from COVID-19 antibodies, revenue grew 6% for the quarter and 10% for the full year. This volume-driven performance is attributable to our key growth products, which grew by 28% and now account for 61% of our core business in Q4.

Unpacking, our 2021 performance on slide four you can see the progress we've made on our strategic deliverables.

Q4 revenue was 8%.

And it was driven by volume growth of 11%.

Well when excluding revenue from COVID-19 antibodies revenue grew 6% for the quarter and 10% for the full year.

This volume driven performance is it is attributable to our key growth products, which grew by 28% and now account for 61% of our core business in Q4.

Dave Ricks: Our non-GAAP gross margin was 76.1% in Q4, a decrease of approximately 250 basis points, driven by increased sales of COVID-19 antibodies, which have a lower gross margin profile. Our non-GAAP operating margin was 31.7%, representing a decrease of approximately 130 basis points, as a result of the lower gross margin percent just mentioned.

On our non-GAAP gross margin was 76, 1% in Q4, a decrease of approximately 250 basis points driven by increased sales of COVID-19, antibodies, which have a lower gross margin profile.

Our non-GAAP operating margin was 31, 7%.

Representing a decrease of approximately 130 basis points.

As a result of the lower gross margin percent just mentioned.

Dave Ricks: Pipeline Milestones, we have shared several important updates since our Q3 earnings call, including additional positive phase 3 readouts for mirakizumab in ulcerative colitis and lebrokizumab in atopic dermatitis, and the initiation of a rolling submission in the U.S. for pertubrutinib in mantle cell lymphoma, and our submission of bebtulovumab to the We also continue to put our cash flow to work to create long-term value and recently announced our plans to make significant investments in new manufacturing sites in both North Carolina and Ireland.

For pipeline milestones, we have shared several important updates since our Q3 earnings call, including additional positive phase III Readouts for miracles Mab in ulcerative colitis, and Leverages, a mab in atopic dermatitis.

The initiation of a rolling submission in the U S for printer, Bruton nib and mantle cell lymphoma.

And our submission of <unk> to the FDA for emergency use authorization for the treatment of mild to moderate COVID-19.

We also continue to put our cash flow to work to create long term value and recently announced our plans to make significant investments in new manufacturing sites in both North Carolina and Ireland. These.

Dave Ricks: These investments will bolster the resilience and capacity of our supply chain as we launch new products to drive meaningful long-term growth. In addition, this quarter, we announced strategic research collaborations with a focus on new modalities as we continue to augment internal discovery capabilities. Finally, on financials, we announced a 15% increase in the dividend for the fourth consecutive year. And in Q4, we distributed nearly $800 million to shareholders via the dividend and completed another $750 million in share repurchase.

These investments will bolster the resilience and capacity of our supply chain as we launched new products to drive meaningful long term growth.

In addition, this quarter, we announced a strategic research collaborations with a focus on new modalities as we continued to augment internal discovery capabilities.

Finally on financials, we announced a 15% increase to the dividend for the fourth consecutive year and in Q4, we distributed nearly $800 million to shareholders via the dividend and completed another $750 million and share repurchases.

Dave Ricks: Moving to slides five and six, you'll see a list of key events since our Q3 earnings call, including several important regulatory, clinical, visit development, and COVID-19 therapy updates we are discussing today or that were part of the discussion during our December 15th investment community meeting. Now, I'll turn the call over to Anat to review our Q4 and full year 2021 results. Thanks Dave.

Moving to slides five and six you'll see a list of key events since our Q3 earnings call, including several important regulatory clinical visit development in COVID-19 therapy updates we are discussing today or that we're part of the discussion during our December 15th investment community meeting.

Anat Ashkenazi: Slide 7 and 8 summarize financial performance for the fourth quarter and full year 2021. I'll focus my comments on non-GAAP performance. In Q4, revenue grew 8% and revenue excluding COVID-19 antibodies increased 6%, highlighting solid momentum for a core business. 4-year revenue growth was 10% on that basis. Gross margin as a percent of revenue declined 250 basis points to 76.1% in Q4. The decrease in gross margin percent was driven by higher sales of COVID-19 antibodies, while shipments this quarter of Bevlenivmeb and Edesevmeb also had a lower gross margin profile compared to Bevlenivmeb sales in the base period. Total operating expenses grew by 5% this quarter.

So now I'll turn the call over to or not to review, our Q4 and full year 2021 results.

Slide seven and eight summarize financial performance in the fourth quarter and full year 2021, I'll focus my comments on non-GAAP performance in Q4 revenue grew 8% and revenue excluding COVID-19 antibodies increased 6% highlighting solid momentum for our core business full.

<unk> full year revenue growth was 10% of that lateral basis.

Gross margin as a percent of revenue declined 250 basis points to 76, 1% in Q4.

The decrease in gross margin percent was driven by higher sales of COVID-19 antibodies with shipments this quarter of Devlin, who met and it is something that also has a lower gross margin profile compared to Devlin of med sales in the base period.

Total operating expenses grew 5% this quarter.

Anat Ashkenazi: Marketing, selling, and administrative expenses increased 2%, while R&D expenses increased 7%, driven by higher development expenses for late-stage pipeline opportunities, including the non-IMEB, per-tubertinib, and terzapatide, which were partially offset by lower development expenses for COVID-19 therapies. We invested approximately $40 million in research and development for COVID-19 therapies in Q4, bringing our total COVID-19 R&D investment Operating income increased 3% compared to Q4 2020, and operating income as the percent of revenue was 31.7% for the quarter, a decrease of 130 basis points. This decrease was driven by lower gross margin percent, partially offset by lower marketing, selling, and administrative expenses as a percent of revenue. Full year operating margin was 29.9%, in line with our expectations.

Our kitting selling and administrative expenses increased 2%, while R&D expenses increased 7% driven by higher development expenses for late stage pipeline opportunities.

The non med preterm birth nib enter its appetite, which will partially offset by lower development expenses for COVID-19 therapies.

We invested approximately $40 million in research and development for COVID-19 therapies in Q4, bringing our total COVID-19, R&D investment to approximately $400 million for the full year.

Operating income increased 3% compared to Q4 2020, and operating income as a percent of revenue was 31, 7% for the quarter a decrease of 130 basis points.

This decrease was driven by lower gross margin percent, partially offset by lower marketing selling and administrative expenses as a percent of revenue.

Full year operating margin was 29, 9% in line with our expectations.

Anat Ashkenazi: Other income and expense was an expense of approximately $7 million this quarter compared to an expense of $31 million in Q4 2020. Our Q4 effective tax rate was 10.3%, a decrease of 280 basis points driven primarily by net discrete tax benefits. We deliver solid growth as earnings per share increase 8% in Q4 and 20% for the full year. On slide 9, we quantify the effect of price, rate, and volume on revenue growth, and we continue to be encouraged by the growth seen across key geographies. This quarter, US revenue grew 13%, excluding revenue from COVID-19 antibodies. Revenue grew 11% in the US. This scroll, driven by volume, was led by Trelissiti, Toltz, Chiarodian, Spersenio, and Leloumian.

Other income and expense was an expense of approximately $7 million this quarter compared to an expense of $31 million in Q4 2020.

Our Q4 effective tax rate was 10, 3% a decrease of 280 basis points, driven primarily by net discrete tax benefits.

At the bottom line, we delivered solid growth as earnings per share.

Increased.

8% in Q4, and 20% for the full year.

On slide nine we quantified the effect of price rate and volume on revenue growth and we continue to be encouraged by the growth seen across key geographies.

This quarter U S revenue grew 13% excluding revenue from COVID-19 antibodies revenue grew 11% in the U S. This growth driven by volume was led by <unk> charity and presenting them in ILUVIEN.

Anat Ashkenazi: The net price decline of 2% in the U.S. this quarter was driven by lower realized prices for insulin, primarily due to changes to estimates for rebates and discounts. For the full year, our U.S. net price decrease of 1% was in line with our expectations. Moving to Europe, revenue in Q4 declined 3% in constant currency, but excluding the impact of the loss of exclusivity for Olympta, revenue grew 11% in constant currency, driven primarily by volume growth for Trlicity, Illumia, and Pulse in Brasenio. We are encouraged by the momentum of our business in Europe and expect continued growth, excluding Olympta. In Japan, revenue in Q4 decreased 14% in constant currency.

The net price decline of 2% in the U S. This quarter was driven by lower realized prices for instruments, primarily due to changes to estimates for rebates and discounts for.

For the full year, our U S. Net price decrease of 1% was in line with our expectations.

Moving to Europe revenue in Q4 declined 3% in constant currency, excluding the impact of the loss of exclusivity for Alimta revenue grew 11% in constant currency driven primarily by volume growth for Felicity ILUVIEN pulse in Brasilia we.

We are encouraged with the momentum of our business in Europe , and expect continued growth excluding the Linda.

In Japan revenue in Q4 decreased 14% in constant currency revenue in Japan continues to be negatively impacted by decreased demand for several products that have lost market exclusivity, including Cymbalta and alimta.

Anat Ashkenazi: Revenue in Japan continues to be negatively impacted by decreased demand for several products that have lost market exclusivity, including Cymbalta and Olympta, as well as by the COVID pandemic. However, with key growth products now representing 56% of total Japan revenue, we expect to return to growth beginning in 2023. In China, revenue grew 13% in constant currency, primarily driven by volume from our continued uptake of Tyvet and Trulicity, as well as the timing of supply for Cialis through the third party selling the product.

As well as by the Covid pandemic.

With key growth products now representing 56% of total Japan revenue, we expect to return to growth beginning in 2023.

In China revenue grew 13% in constant currency, primarily driven by volume from our continued uptake of <unk> as well as the timing of supply for CLS third party selling the product.

Anat Ashkenazi: Q4 revenue growth was negatively affected by the updated 2022 NRDL price reductions on inventory already in the channel, especially for Taivet. In 2022, we expect the NRDL price reduction headwind to largely offset volume growth in Q1, but we also expect volume growth to accelerate throughout the year and exceed the impact of these price reductions. Moving forward, we're excited about the significant growth we're seeing in China, over 40% in constant currency in 2021, with improved access expected to continue to drive future growth. Revenue in the rest of the world increased 16% in constant currency this quarter, driven primarily by sales of newer medicines.

Q4 revenue growth was negatively affected by the updated 2022 and our deal price reductions on inventory already in the channel, especially for tie that.

In 2022, we expect the enter the old price reduction headwind largely offset volume growth in Q1, but we also expect volume growth to accelerate throughout the year and exceed the impact of these price reductions.

Moving forward, we're excited about the significant growth, we're seeing in China over 40% in constant currency in 2021 with improved access is expected to continue to drive future growth.

Revenue in the rest of the world increased 16% in constant currency this quarter, driven primarily by sales of Miro medicine.

Anat Ashkenazi: We continue to expect a mid single-digit net price decline in 2022 for the US, Europe, and Japan. In China, the expanded NRDL axis for products should lead to a significant volume increase, but also a high double-digit declining price. As a result, we expect total company net price declines in the high single digits in 2022.

We continue to expect a mid single digit net price decline in 2022 for the U S Europe , and Japan, and China. The expanded <unk> access for our products should lead to significant volume increase but also high double digit decline in price.

As a result, we expect total company net price decline in the high single digits in 2022.

Anat Ashkenazi: At the bottom of the slide is the price, rate, and volume effect on revenue for all 2021, which shows strong double-digit, volume-driven revenue growth across most major geographies. As shown on slide 10, our key growth products continue to drive robust worldwide volume growth. These products drove 14 percentage points of growth this quarter and continue to bolster overall performance and out... Slide 11 further highlights the contribution of our key growth products. This quarter, these brands generated over $4.2 billion in revenue and made up 61% of our core business revenue.

At the bottom of the slide is the price rate and volume effect on revenue for all 2021, which shows strong double digit volume driven revenue growth across most major geographies.

As shown on slide 10 are our key growth products continued to drive robust worldwide volume growth.

These products drove 14 percentage points of growth this quarter and continue to bolster overall performance and outlook.

Slide 11 further highlights the contribution of our key growth products.

This quarter these brands generated over $4 $2 billion in revenue and made up 61% of our core business revenue.

Anat Ashkenazi: In Q4, these newer medicines grew by 28%, and Trelicity, Jardians, Tulse, and Versenio all continue to outgrow their respective classes. We are particularly pleased with the continued market growth of both the GLP-1 and the SGLT-2 classes, where Trulicity and Jardians are market leaders. We are also encouraged by the strong uptake of Resenio we saw in Q4, driven by the approval and launch of the adjuvant indication, which has led to an increase in both new and total prescriptions.

In Q4 of these newer medicine grew by 28% and solicit each are already installed and <unk> all continue to outgrow their respective classes.

We are particularly pleased with the continued market growth of both the G. L. P. One N V. S. G. L T. Two classes, where it's for licit enjoyed in our market leaders.

We are also encouraged by the strong uptake of residual we saw in Q4, driven by the approval and launch of the adjuvant indication, which has led to an inflection in both new and total prescriptions.

Anat Ashkenazi: On slide 12, we provide an update on capital allocation. In 2021, we invested $9.3 billion to drive our future growth through a combination of R&D expenditures, business development outlays, and capital investment. In addition, we returned approximately $3.1 billion to shareholders in dividends and repurchased approximately $1.3 billion in stock.

On slide 12, we provide an update on capital allocation in 2021, we invested $9 3 billion to drive our future growth through a combination of R&D expenditures business development outlays and capital investment.

In addition, we returned approximately $3 1 billion to shareholders in dividend and repurchased approximately one 3 billion in stock.

Anat Ashkenazi: Our capital allocation priorities remain unchanged as we continue to fund our market of products and expected launches, invest in our pipeline, evaluate opportunities for external innovation to augment our future growth prospects, and return excess capital to shareholders. On slide 13 is our 2022 financial guidance we issued in December. As I share then, the financial impact from the loss of exclusivity of Olympia in Europe and Japan will continue in the first half of 2022.

Our capital allocation priorities remain unchanged as we continue to fund our marketed products and expenses expected launches.

Invest in our pipeline and valued opportunities for external innovation to augment our future growth prospects and return excess capital to shareholders.

On slide 13 is our 2022 financial guidance, we issued in December .

As I shared then the financial impact from the loss of exclusivity of Alimta in Europe , and Japan will continue in the first half of 2022 well.

Anat Ashkenazi: Well, the impact of Olympia's U.S. Sputnik spree will start with the limited launch of a single generic company in Q1 before the full launch of additional generic entrants starting in Q2. We expect roughly $375 million of revenue from COVID-19 antibodies in Q1 from the shipment of the remaining doses attributable to last November's U.S. government purchase agreement. We continue to invest in our bright future, advancing promising R&D opportunities, and preparing for exciting potential launches from our late-stage pipeline, which we believe will help drive top-tier revenue growth through at least 2030. Now, I'll turn the call over to Dan to provide an update on our pipeline. Thank you, Anat.

Well the impact from Olympus U S. Fat next free we'll start with the limited launch from a single generic company in Q4 in Q1 before the full launch of additional generic entrants starting in Q2.

We expect roughly $375 million of revenue from COVID-19 antibodies in Q1 from the shipment of the remaining doses attributable to last November's U S government purchase agreement.

We continued to invest in our bright future advanced and promising R&D opportunities and preparing for exciting potential launching from launches from our late stage pipeline, which we believe will help drive top tier revenue growth or at least 23 now.

Now I'll turn the call over to Dan to provide an update on our pipeline.

Dan Skovronsky: 2021 was a remarkable year for Lilly's pipeline. We delivered positive data for five molecules, terzapotide, danetumab, protobrutenib, mirakizumab, and lebrokizumab, all of which have the potential to launch in the next two years. And we're excited about the potential these molecules hold for patients. In addition, we launched and submitted several key new indications for in-market products, including important new indications for Versenio and Jardia, and we also advanced our early stage pipeline. Just a few weeks ago, we provided an extensive R&D update across our therapeutic areas and shared our excitement about the next wave of innovation coming from Ledge.

Thank you or not.

'twenty, one was a remarkable year for lilly's pipeline.

We delivered positive data on five molecules tours appetite to not put a burden of Chisholm Mab and Leverages a mab.

All of which have the potential to launch in the next two years and we're excited about the potential of these molecules hold for patients.

In addition, we launched and submitted several key new indications for in market products, including important new indications for <unk> and <unk>.

And also we advanced our early stage pipeline.

Just a few weeks ago, we provided an extensive R&D update across our therapeutic areas and ensured our excitement about the next wave of innovation coming from Lilly.

Dan Skovronsky: As a result, today's R&D update will be brief and focus on the progress we've made since our last earnings call. Slide 14 shows select pipeline opportunities as of January 31, and slides 15 and 16 show a recap of 2021 key events and potential key events for 2022. In diabetes, with the recent submission in Japan, we've now submitted terzepatide across all major geographies for the treatment of type 2 diabetes.

As a result, today's R&D update will be brief and focus on the progress we've made since our last earnings call.

Slide 14 shows select pipeline opportunities as of January 31, and slides 15, and 16 show a recap of 2021 key events and potential key events for 2022.

And diabetes with the recent submission in Japan, we've now submitted tours appetite across all major geographies for the treatment of type two diabetes.

Dan Skovronsky: We look forward to potential approvals for this important medicine this year. We anticipate U.S. regulatory action in type 2 diabetes, as well as the top line readout from Surmount I, both by midyear. In Japan, we submitted Jardians for heart failure with preserved ejection fraction and received approval for Jardians for treatment of heart failure with reduced ejection fraction.

We look forward to potential approvals for this important medicine this year.

We anticipate U S regulatory action in type two diabetes as well as the topline readout from surmount one both by mid year.

In Japan, we submitted <unk> for heart failure with preserved ejection fraction and received approval for <unk> for treatment of heart failure with reduced ejection fraction.

Dan Skovronsky: Moving to oncology, we shared encouraging updated data at ASH for protobrutonib for both chronic lymphocytic leukemia and mantle cell lymphoma. We continue to progress this molecule and initiated another phase 3 study in first-line CLL, comparing protobrutinib to chemo immunotherapy. During our December meeting, we also announced the initiation of a rolling submission for Pertobrutinib for MCL in the U.S. We plan to complete this submission this year with anticipated regulatory action in early 2023, and we're excited to potentially bring this important medicine to patients on this accelerated timeline.

Moving to oncology, we shared encouraging updated data at ash for pretty brutal for both chronic lymphocytic leukemia and mantle cell lymphoma.

We continue to progress this molecule and initiated another phase III study in first line CLO, comparing pretty brutal nib to chemo immunotherapy drew.

During our December meeting, we also announced the initiation of a rolling submission for <unk> for Mcl in the U S. We plan to complete the submission this year with anticipated regulatory action in early 2023, and we're excited to potentially bring this important medicine to patients on this accelerated timeline.

Dan Skovronsky: For Vresenio, we received approval for high-risk early breast cancer in Japan for the Cohort 1 population studied in Monarchy and are pleased that this approval represents 90% of the intent-to-treat population. We've also made the difficult decision to terminate further enrollment in the Phase 3 study of Versenio for HR-positive, HER2-positive early breast cancer in response to the changing treatment landscape and global enrollment challenges. Importantly, this decision does not change our commitment to and investment in breast cancer research. In addition, we began a phase three study for selprocatinib for the treatment of adjuvant RET-positive non-small cell lung cancer, and we also dosed the first patient in the U.S. trial of OBCL-2 inhibitors.

For <unk>, we received approval for high risk early breast cancer in Japan for the cohort one population studied a monarchy.

And are pleased that this approval represents 90% of the intent to treat population.

We've also made the difficult decision to terminate further enrollment in the phase III studies of <unk> for HR positive. Her two positive early breast cancer in response to the changing treatment landscape and global enrollment challenges.

Fortunately this decision does not change our commitment to and investment in breast cancer.

In addition, we began a phase III study for cell per cabinet for the treatment of adjuvant ret positive non small cell lung cancer and we also dosed the first patient in the U S trial of Ob <unk> two inhibitor.

Dan Skovronsky: In Immunology, we announce positive top-line data for our Phase 3 maintenance study of Myriakismab and ulcerative colitis. We're pleased that the study met all primary and key secondary endpoints, and we look forward to submissions in the first half of this year. We also announced positive top-line phase III results for leprochizumab in combination with topical corticosteroids, and we're encouraged that data to date has demonstrated a competitive profile for the treatment of atopic dermatitis.

In immunology, we announced positive top line data for our phase III maintenance study of mirror Chisholm Abbott all sort of colitis.

We're pleased that the study met all primary and key secondary endpoints and we look forward to submissions in the first half of this year.

We also announced positive top line phase III results for <unk> in combination with topical corticosteroids and we're encouraged that data to date has demonstrated a competitive profile for treatment of atopic dermatitis.

Dan Skovronsky: We await maintenance data for Lebrekismab in the first half of this year in advance of global submissions, which are expected by the end of 2022. Moving to baricitinib. We announced last week that based on top-line efficacy results from two phase three trials, we've decided to discontinue the phase three development program for lupus. For atopic dermatitis in the US, we're in ongoing discussions with the FDA, but do not have alignment with the agency on the indicated population, which could possibly lead to a complete response letter. We expect regulatory action for this indication very soon. Finally, we've submitted baricitinib for alopecia areata in the U.S., and we hope it will become the first medicine approved for patients living with this disease later this year.

We await maintenance data for <unk> in the first half of this year in advance of global submissions, which are expected by the end of 2022.

Moving to bear citizen, we announced last week that based on topline efficacy results from two phase III trials, we've decided to discontinue the phase III development program for lupus.

For atopic dermatitis in the U S. We're in ongoing discussions with the FDA, but do not have alignment with the agency on the indicated population, which could possibly lead to a complete response letter.

We expect regulatory action for this indication very soon.

Finally, we have submitted bear sitting in for alopecia Areata in the U S and hope it will become the first medicine approved for patients living with this disease later this year.

Dan Skovronsky: In our early phase immunology portfolio, we started a new Phase 1 study for a CD19 antibody, and we've discontinued our oral IL-17 inhibitors. Now, moving to neurodegeneration. In our early phase pipeline, we announced that we've received breakthrough therapy designation for N3PG4, an additional amyloid lowering agent for which we intend to initiate pivotal trials by the end of this year. We have evidence that this therapy has completely and rapidly cleared amyloid plaque, and we're exploring flexible dosing regimens, including subcutaneous dosing. For the treatment of Alzheimer's disease, we also began a phase two trial for O-glycnacase inhibitor, an oral small molecule targeting tau.

And our early phase immunology portfolio, we started a new phase one study for CD 19 antibody, we've discontinued our oral IL 17 inhibitor.

Moving to neuro degeneration in our early phase pipeline, we announced that we have received breakthrough therapy designation for <unk> for an additional amyloid lowering agent for which we intend to initiate pivotal trials by the end of this year.

We have evidence that this therapy is completely and rapidly cleared amyloid plaque and we're exploring flexible dosing regimens, including subcutaneous dosing.

For the treatment of Alzheimer's disease. We also began a phase II trial for <unk> <unk> inhibitor, an oral small molecule targeting tau.

Dan Skovronsky: While Dynanomab has been a primary focus for investors, we're pleased with the continued clinical advancement of the rest of our neurodegeneration pipeline. Now, turning to Denenumab. In December, we initiated two additional Phase 3 studies: Trailblazer L3, our prevention study for asymptomatic Alzheimer's disease, and Trailblazer L4, our head-to-head plaque clearance study compared to Addehelm. It's been less than one year since we published the positive randomized controlled trailblazer ALT study, which demonstrated clinically meaningful benefits on endpoints of cognition and function.

While <unk> has been a primary focus for investors. We are pleased with the continued clinical advancement of the rest of our neuro degeneration pipeline.

Now turning to <unk> in December we initiated two additional phase III studies Trailblazer L. Three our prevention study for asymptomatic Alzheimer's disease, and Trailblazer House for our head to head plaque clearance study compared to out of home.

It's been less than one year since we published the positive randomized controlled trailblazer, all study, which demonstrated clinically meaningful benefits on endpoints of cognition and function.

Dan Skovronsky: Since then, we have focused investors on the need for replication from our well-designed expanded Phase 3 study, Trailblazer ALS-2, which is now fully enrolled and expected to read out in mid-2023, while a lot has happened in this space during this last year, and more events are likely before we get top-line results next year. What hasn't changed for us is the importance of the Trailblazer L2 readout and our confidence in both the Nanomab and the unique study design.

Since then we have focused investors on the need for replication from our well designed expanded phase III study Trailblazer house to.

Which is now fully enrolled and expected to readout in mid 2023.

While a lot has happened in this space during this last year and more events are likely before we get topline results next year.

What hasnt changed for US is the importance of the trailblazer ALS to readout and our confidence in both the nano Mab and the unique study design.

Dan Skovronsky: Given the impact of this devastating disease, we believe that if Trailblazer ALS-2 provides positive confirmatory data, we can't see a scenario where there isn't global reimbursement, patient access, and broad use of denataminase. We noted last year that we had low expectations for the use of the Netamap during the period between potential accelerated approval and the availability of confirmatory Phase III data in mid-2023. We're disappointed with the position that the Centers for Medicare and Medicaid Services has taken in its draft National Coverage Determination Decision, and those low expectations could now extend for some months beyond the Trailblazer L2 readout if reconsideration of the CMS coverage determination is required, given the historical timelines for this process.

Given the impact of this devastating disease, we believe that if trailblazer ALS two provides positive confirmatory data, we can't see a scenario, where theres not global reimbursement patient access and broad use of that amount.

We noted last year that we had low expectations for the use of genetic map during the period between potential accelerated approval and the availability of confirmatory phase III data in mid 2023.

We are disappointed with the position that centers for Medicare and Medicaid services has taken in its draft national coverage determination decision.

And those low expectations could now extend for some months beyond the trailblazer else to readout, if reconsideration of CMS coverage determination is required given historical timelines for this process.

Dan Skovronsky: While the Accelerated Approval Pathway was instituted by the FDA to allow for earlier approval of drugs that treat serious conditions and fill a non-medical need, hence providing valuable access to more patients faster than what is available under clinical trials, the NCD, as currently written, essentially negates that patient benefit in Alzheimer's disease.

While the accelerated approval pathway was instituted by the FDA to allow for earlier approval of drugs that treat serious conditions and filling an unmet medical need and is providing valuable access to more patients faster than what is available under clinical trials. The NCD as currently written essentially negates that patient benefit and Alzheimer's disease.

Dan Skovronsky: Still, we intend to complete our application for accelerated approval for Genetimab this year, but we now move completion of the accelerated approval submission out of Q1. We expect further volatility in expectations as competitor Alzheimer's disease trials read out prior to our definitive data. However, we remain confident in the differentiation of Dinetimab and in our uniquely designed Trailblazer ALS-2 study. And, importantly, the long-term opportunity to help patients with donatomab remains unchanged. Lastly, with respect to our progress with COVID-19 therapies, early this year, we submitted a request to the FDA for emergency use authorization for bebtelivimab for treatment of mild to moderate COVID-19 in patients at high risk for progression of severe COVID-19, including hospitalization or death. This is the third antibody we've developed for the treatment of COVID-19, and authentic virus and pseudovirus assays demonstrate that bebtolevimab retains neutralization activity against omicron as well as all other known variants of concern.

Still we intend to complete our application for accelerated approval for genetic map yet this year.

But we now move completion of the accelerated approval submission out of Q1.

We expect further volatility in expectations as competitor Alzheimer's disease trials read out prior to our definitive data.

We remain confident that differentiation of genetic map and in our uniquely designed trailblazer ALS II study.

And importantly, the long term opportunity to help patients with genetic map remains unchanged.

Lastly, with respect to our progress with COVID-19 therapies early this year, we submitted a request to the FDA for emergency use authorization for bed telephone mab for treatment of mild to moderate COVID-19 for patients at high risk for progression to severe COVID-19, including hospitalization or death.

This is the third antibody we've developed for the treatment of COVID-19, and authentic virus and pseudo virus assays demonstrate that bad to lever mab routines neutralization activity against <unk> as well as all other known variance of concern.

Dan Skovronsky: We've produced several hundred thousand doses of bebtolevimab and stand ready to supply as needed if this antibody receives an EUA from the FDA. In addition, we've also submitted a supplemental NDA for B.A.R.E. SITNEB for treatment of hospitalized patients with COVID-19 and expect regulatory action by the middle of this year.

We've produced several hundred thousand doses of <unk> and stand ready to supply as needed. If this antibody receives EUA from the FDA.

In addition, we've also submitted a supplemental NDA for bear sitting there for treatment of hospitalized patients with COVID-19, and expect regulatory action by the middle of this year.

Dan Skovronsky: Bear Sidney currently has an EUA for this indication. We're proud of the therapies we've delivered to help combat the COVID-19 pandemic, and we'll continue to do our part as public health needs emerge. In summary, Q4 was another productive quarter for R&D at Lilly, capping what was an outstanding year of pipeline progress on behalf of patients. Now, I'll turn the call back to Dave.

We are sitting there currently has an EUA for this indication.

We're proud of the therapies, we've delivered to help combat the COVID-19 pandemic and we'll continue to do our part as public health needs emerge.

In summary, Q4 was another productive quarter for R&D at Lilly capping what was an outstanding year of pipeline progress on behalf of patients.

Now I'll turn the call back to Dave.

Dave Ricks: Thanks, Dan. Before we move to Q&A, let me summarize the progress we made during 2021. We delivered strong revenue growth in our core business propelled by our key growth products. We continue to invest heavily in our pipeline and made significant progress in 2021 generating positive phase 3 data for five new potential medicines. Terzapotai. Donate a map, Perjabrutonib.

Thanks, Dan before we move to Q&A, Let me summarize the progress we made during 2021 we.

We delivered strong revenue growth in our core business propelled by our key growth products.

We continue to invest heavily in our pipeline and.

And made significant progress in 2021 generating positive phase III data for five new potential medicines.

Precipitate.

Add them up.

<unk> nib.

Dave Ricks: Mira Kizumab and Lebra Kizumab, that we expect we will launch in the next two years. We also delivered positive data and launched important new indications for Jardians and Bresenio, while we continue to bolster our pipeline through business development with a focus on new modalities. Finally, we returned $4.35 billion to shareholders via the Dividend and Share Repurchase and for the fourth consecutive year announced a 15% dividend increase.

<unk> Mab and Leverages a mab.

So we expect we will launch in the next two years.

We also delivered positive data and launched important new indications for <unk> and <unk>.

While we continue to bolster our pipeline through business development with a focus on new modalities.

Finally, we returned $4 $35 billion to shareholders via the dividend and share repurchases and for the fourth consecutive year announced a 15% dividend increase.

Kevin Hearn: As we move into 2022, we are excited to continue the progress of turning pipeline value into cash flow, starting with the potential launch of trizepatide and the submissions of donenumab, pergabrutinib, mirakizumab, and leberkizumab. These opportunities remind us that our purpose has never been more relevant, and highlight the promise of turning science into treatments or cures for some of the most challenging human diseases like diabetes, obesity We are steadfast in our commitment to improve the lives of millions of patients who rely on us and are confident in our business outlook. Now, I'll turn the call over to Kevin to moderate the Q&A session. Thanks Dave.

As we move into 2022, we are excited to continue the progress of turning pipeline value into cash flow starting with the potential launch of <unk> and the submission of <unk> for the brunette mirror Kismet and Leverages a map.

These opportunities remind us that our purpose has never been more relevant.

And highlight the promise of turning science into treatments or cures for some of the most challenging human diseases like diabetes obesity, Alzheimer's cancers and autoimmune disorders.

We are steadfast in our commitment to improve the lives of millions of patients who rely on us.

And are confident in our business outlook.

So now I'll turn the call over to Kevin to moderate the Q&A session.

Thanks, Dave.

We'd like to take questions from as many callers as possible. So we ask that you limit your questions to two per caller lowest.

Operator: We'd like to take questions from as many callers as possible, so we ask that you limit your questions to two per caller. Lois, please provide the instructions for the Q&A session, and then we're ready for the first caller. Thank you, and, ladies and gentlemen, if you wish to ask a question, please press one then zero on your telephone. You will hear an acknowledgment tone that you've been placed in the queue, and you may remove yourself from the queue at any time by repeating the 1-0 command.

Lois please provide the instructions for the Q&A session and then we're ready for the first caller.

Operator: If you are on a speakerphone, please pick up your handset before pressing a number. Once again, please press 1 then 0. And our first question is from Seamus Fernandez from Guggenheim. Please go ahead. Oh, great. Thanks for the question. So, you know, first, Dan, can you just give us a little bit of the thought process for pushing out the accelerated filing for Denanimab? It certainly makes sense, but how much did the NCD actually work into that calculus versus needs or requests from the agency for additional data?

Thank you and ladies and gentlemen, if you wish to ask a question. Please press one then zero on your telephone keypad.

You will hear an acknowledgment now that you've been placed in the queue and you may remove yourself from queue at any time by repeating the ones you know command.

If you're on a speakerphone please pick up your handset before pressing the numbers once again, please class London at this time.

And our first question is from Seamus Fernandez from Guggenheim. Please go ahead.

Oh, great. Thanks question so.

You know firsthand can you just give us a little bit of the thought process for.

Pushing out the accelerated filing or Jinan a mab.

Certainly makes sense, but how much did the NCD.

NPD actually.

Work into that calculus.

Ah versus need or requests from the agency for additional data.

Operator: And then the second question, just really wanted to get a better understanding of where you guys think the Surmount One data set would be, you know, where the thresholds would be. We're seeing, you know, 68-week data from WeGoBe coming in at, you know, about 15 to 17 percent in a non-diabetic patient population. Just wanted to get a sense of some of the pushes and pulls that we should be thinking about in the context of the Surmount One data set.

And then the second question.

Just really wanted to get a better understanding.

Where do you guys think Mr Mountain one.

Datasets.

You know where that where the thresholds would be we're seeing 68 week data from we go be coming in at.

About 15% to 17%.

In a non diabetic patient population just wanted to get a sense of some of the pushes and pulls that we should be thinking about in the context of this amount one dataset. Thanks so much.

Thanks so much. Thanks, Seamus. We'll go to Dan for the question on the accelerated approval timeline and then Mike Mason on the expectations for Surmount One. Thank you, Seymour. It's a good question.

Thanks, Seamus, we'll go to Dan for the question on accelerated approval timeline, and then Mike Mason on expectations for surmount one yeah. Thank you Simon it's a good question.

Look, I think, as I said, the purpose of accelerated approval is to try and get medicines to help patients faster. But without access, that benefit is mainly negated, unfortunately, and clearly a very frustrating period for patients to have approval of a drug but no reimbursement. So the CMS draft NCD proposal weighed heavily in our considerations around timing and clearly reduced some of the ability to help patients faster that we were hoping for with accelerated approval.

I think as I said, the purpose of accelerate approvals to try and get medicines and into.

To help patients faster.

Without access.

Benefit is mainly negated unfortunately, and clearly a very frustrating paired for patients to have approval of a drug and no reimbursement so.

The CMS draft NCD proposal weighed heavily in our considerations around timing and clearly reduces some of the.

Our ability to help patients faster than we were hoping for with the accelerated approval.

With respect to the other part of your question, which is you know how 'bout request from the FDA or new data or anything like that.

With respect to the other part of your question, which is, you know, how about requests from the FDA or new data or anything like that, there are none of those factors here. We haven't had any such requests.

There are none of those are factors.

Factors here, where you haven't had.

Such requests.

So it's really about CMS and about our own team's ability to just get all of the data together and get the right amount of safety data compiled in a way that the FDA can analyze. So we'll continue to work towards accelerated approval this year, but not in Q1. Mike.

So it's really about CMS and about our own teams ability to just get all the data together and get the right amount of safety data.

In a way that the FDA can can analyze so we'll continue to work towards accelerated approval yet this year, but are no longer in Q1.

Thanks, Dan Mike.

Yeah, thanks for the question. We are excited to see this from our own data. You know, there's a good theory about why someone who lived with obesity would have greater weight loss on a product like triseptide than those that have type 2 diabetes. Those theories tend to play out when we look at the NOVO semaglutides STEP program for those. Those who didn't have type 2 diabetes had 6 or 7 percentage points greater weight loss than those who had type 2 diabetes.

Yes, thanks for the question.

<unk> to see this from out one data.

There is good.

Here on why someone who lives with our BCD.

Would have greater weight loss on a product like there's appetite and those that have type two diabetes.

Those series in the play out when we looked at the Novo smuggler ties step program, where those are.

Those who had didn't have type two diabetes at six or seven percentage points greater weight loss than those that had type two diabetes.

We don't know what it's going to turn out to be for Surmount 1. We do believe that it's going to be higher in the non-type 2 diabetes population, based on what we saw in the Prashtun study. Dr. Prashtun, Dr. Prashtun, Dr. Prashtun. The good thing is we don't have to wait too long for those results. We expect those in the first half of this

We don't know what it is going to turn out to be enforced from out one we do believe that it's going to be higher in the in the non type two diabetes patients than what we saw in the.

Surpass studies. Good thing is we don't have to wait too long for those results. We expect those in the first half of this year.

And so we'll be patient and look for the results. We'll be excited by what we see. Thanks, Mike. Seamus, thanks for your question. Next caller, please. And the next caller is Ronnie Gale from Bernstein.

So we'll be patient and look where the results.

I think we will be excited by what we see.

Thanks, Mike Seamus. Thanks for your questions next caller please.

And the next caller is Ronny Gal from Bernstein. Please go ahead.

Please go ahead. Hi, good morning, and thank you very much for taking my questions. The first one is about N3PG4 in early AD.

Hi, good morning, and thank you very much for taking my question.

The first one is around the <unk> for nearly a D. You're starting a second agent fairly quickly can you talk about other distinguishing features for those products versus.

Banana, Matt is it just that removes black faster also there are others. For example is it removing preferentially pervenche demo a plaque versus vascular flat.

And the second you kind of mentioned your expectations Nancy D. But can you confirm to us that you do not expect the NCD to materially change in its final form versus the draft form and if you can talk a little bit about the process of requesting a change to that entity. Once we have confirmatory data for the amyloid beta removing drugs.

Thanks, Ronnie will go to Dan for the first question on <unk> four and then in the question on the NCD expectations.

You know, you're starting a second agent fairly quickly. Can you talk about other distinguishing features for this product versus Nanomab? Is it just that it removes plaque festerals, or are there others?

Thanks, Ronny on an interview for.

Originally we started working on this molecule because of antidrug antibodies that we saw in contingency against <unk>.

Cause of those 80 as we've dosed in that I mab at pretty high levels and that in combination with the formulation of genetic map have precluded our ability of generating a subcutaneous dosing form. So that was an important consideration are those two things I would say for development of event through BG for it binds the same <unk>.

Taupe as Donato Mab, so our understanding and our data suggests it clears exactly the same types of plaques. That's important dress side I think we've seen compelling efficacy here and trailblazer from from genetic mapping and we want more of the same in the next molecule. So.

No differences here and type of plaque I think speed of plaque removal.

Our expectations are it should be similar to that of Mab, which is to say a quite rapid.

And the big advantage here is likely to be around.

Dosing and administration.

Thanks, Dan.

For example, is it removing preferentially parenchymal plaque versus vascular plaque? And second, you kind of mentioned your expectations for the NCD, but can you confirm to us that you do not expect the NCD to materially change in its final form versus its draft form? And if you can talk a little bit about the process of requesting a change to that NCD once we have confirmatory data for the amyloid beta-removing enzyme, Thanks, Ronny.

Well, thanks, Ronny, we believe more than likely the final NCD in April may not change very much really what matters. Most to us is ensuring rapid availability of banana mab for patients with that confirmatory phase III data and so that's going to be our focus with CMS, we believe that well designed and controlled registration trials like trailblazer.

We'll go to Dan for the first question on N3PG4 and then Anne for the question on NCD expectations. Thanks, Ronny. On N3PG4, you know, originally, we started working on this molecule because of anti-drug antibodies that we saw in contingency against Denenimab. Because of those ADAs, we've dosed Denenimab at pretty high levels, and that, in combination with the formulation of Denenimab, has precluded the ability to generate a subcutaneous dosing form.

So that was an important consideration, those two things, I would say, for the development of N3PG4. It binds to the same epitope as Denenimab, so our understanding and data suggest that it clears exactly the same types of plaques. That's important to us. I think we've seen compelling efficacy here in Trailblazer with Denenimab, and we want more of the same in the next molecule.

All in all two should certainly provide sufficient evidence of clinical benefit for Donana mab and that the CD is not needed or appropriate for demand.

We're also going to see confirmation when CMS is really to your question that once this phase III efficacy and safety has been established that <unk> and other medicines with this level of verified evidence would be fully covered by CMS and we want that path for this coverage to be clearly laid out as Dan mentioned it may take some months after the after the television to read.

To work through that but we'll certainly focus on that we have been and will continue to meet with CMS to make our points known and to work through what that process is.

I think as Dan alluded to what we believe is that with phase III confirmatory data and ultimately an FDA traditional approval, we cannot envision a reason why CMS would treat Alzheimer's disease differently than any other class of medicines. I mean, this is really be unprecedented and I believe the pushback from the patient community from their caregivers.

And from those that advocate for them would be significant and CMS would have we believe no choice, but to change. It. So our focus is on that phase III data.

I think the speed of plaque removal, our expectations are it should be similar to Denenimab, which is to say quite rapid, and the big advantage here is likely to be around dosing and administration. Thanks, Anne.

Thanks, and Brian Thanks for your questions next caller please.

Well, thanks, Ronnie. We believe, more than likely, the final NCD in April may not change very much. Really, what matters most to us is ensuring rapid availability of Denanamab for patients with that confirmatory Phase 3 data, and so that's going to be our focus with CMS. We believe that well-designed and controlled registration trials, like Trailblazer-ALS and ALS-2, should certainly provide sufficient evidence of clinical benefit for Denanamab and that a CD is not needed or appropriate for Denanamab.

We're also going to seek confirmation from CMS, really to your question, that once this Phase 3 efficacy and safety have been established, that Denanamab and other medicines with this level of verified evidence would be fully covered by CMS, and we want that path for this coverage to be clearly laid out. As Dan mentioned, it may take some months after the TB2 readout to work through that, but we'll certainly focus on that.

We have been and will continue to meet with CMS to make our points known and to work through what that process is, and I think, as Dan alluded to, what we believe is that with Phase 3 confirmatory data and ultimately FDA traditional approval, we cannot imagine a reason why CMS would treat Alzheimer's disease differently than any other class of medicine.

I mean, this would really be unprecedented, and I believe the pushback from the patient community, from their caregivers, and from those that advocate for them would be significant, and CMS would have, we believe, no choice but to change it. So, our focus is on that Phase 3 data. Thanks, Anne.

The next caller is the mill demand.

And I do hope Securities. Please go ahead.

Ronnie, thanks for your questions. Next caller, please. The next caller is Vimal Devan from Mizzou Health Securities. Please go ahead. Hi, great.

Thanks for taking the question. So maybe one follow up on Genanimab and then one other one unrelated. So in terms of, you know, obviously, appreciate what you're saying around the accelerated approval and kind of changing your timeline there. I'm wondering what Trailblazer IV is for, and if there's any reason, I'm kind of wondering what the rationale for that trial is now, given the limited uptake of Adderhelm to this point. You'll get data later this year, but I'm just wondering if it makes sense, And then my second question is unrelated.

Hi, great. Thanks for taking my question, So maybe one follow up on <unk>.

And then one other one unrelated so in terms of.

I appreciate what you're saying around the accelerated approval and kind of changing your timelines. There I was wondering what trailblazer for and if there's any reason I'm kind of wondering what the rationale for that trial is now given the limited uptake of <unk>.

To this point so we had data later this year, but I'm just wondering if it makes if there's any sort of change in strategy youre thinking around the need for that trial and what exactly that might accomplish and then my second question unrelated you mentioned around the linear and the updates from last week, but you also have submitted for alopecia Haryana I'm. Just wondering if you could maybe just talk a little bit about what you.

You mentioned Illumion, the updates from last week, but you also have submitted for alopecia areata. I'm just wondering if you could maybe just talk a little bit about what you see for the potential, I guess, for the JAK class overall, in that space, but also for Illumion specifically, just given the safety concerns we've seen around that product in the class from before. Thank you.

You see the potential I guess for the JAK class overall in that space, but also for ILUVIEN, specifically just given the.

The safety concerns we've seen.

Around that product in the class from before thank you.

We'll go to Dan for the question on Trailblazer 4 and then Patrik for your question on Alopecia Areata. Yeah, thanks, Fahmul. You raise a good point about Trailblazer 4, which is a head-to-head against Aduham.

Thanks, Rommel, we'll go to Dan for the question on Trailblazer for then Patrick for your question on Alopecia Areata.

Thanks, Rommel you raise a good point on trailblazer for which is a head to head against <unk>.

Of course, there was a lot of excitement and patient interest and investigator interest in this trial because it's, you know, two drugs compared to each other. So, on the other hand, as you point out from a commercial perspective, the importance of showing superiority to aduhelm may have dramatically diminished. That's okay.

Of course, there was a lot of excitement and patient interest and investigator interest in this trial because it's.

Two drugs compared to each other.

So on.

On the other hand, as you point out from a commercial perspective, the importance of showing superiority to Andrew how may have dramatically diminished, but that's okay. We're still committed to doing this trial.

We're still committed to doing this trial. I think from a scientific perspective, there will be important conclusions. We have a hypothesis, for example, that the more rapid and deep plaque clearance could lead to greater improvements in biomarkers.

I think from a scientific perspective, they'll be important conclusions we have a hypothesis for example that the.

More rapid and deep plaque clearance could lead to greater improvements in biomarkers.

I think those kinds of assessments can only be done in a head-to-head study, so this will still be an important contribution to our overall understanding of Alzheimer's disease. Thank you for your time. Thank you, Sam. Thank you very much for the question. Well, we submitted Lumion Paralipesia Areata to the FDA late last year, and it's now submitted post to the European and Japanese regulatory bodies. There are currently no treatments approved for Paralipesia Areata.

Those kinds of assessments can only be done in a head to head studies. So this will still be an important contribution to our overall understanding of Alzheimer's disease.

Thanks, Dan Patrick Thank.

Thank you very much for the question.

Some may say, Dan Oh, new round for alopecia Areata with the FDA late last year and its now submit data most of European and the Japanese regulatory body.

We have an opportunity here to be first in disease with Lumion, and we have been encouraged by the data that we've seen from both BRAVE I and BRAVE II, both based upon physician assessment as well as self-assessment by patients. And there is truly an unmet need in this space.

But currently no treatments approved for alopecia Areata with US we have an opportunity here to be plus indices with illumina and we have been encouraged with the data that we've seen from both great. One embraer to both based upon physician assessment. That's the way I said I thought to ask on by patients and that is truly an unmet need in this space. We have currently approximately three.

We currently have approximately 360,000 patients diagnosed in the U.S., and we believe at least 100,000 of those would be eligible for treatment with JAX. And based upon the profile that we have seen from other assets, we believe that we can launch here with a competitive profile to help patients with Paralipesia Areata. Thanks, Patrick.

And it takes it follows on patients are diagnosed in the U S and we believe at least 100000, a day both would be eligible for treatment with <unk> and based upon the profile that we have seen from Abbott assets. We believe that we can draw on share with our competitive profile to help patients with <unk>.

Vamal, thanks for your questions. Next caller, please. The next caller is Steve Scala from Cohen. Please go ahead.

Thanks, Patrick Rommel. Thanks for your questions next caller please.

The next caller is Steve Scala from Cowen. Please go ahead.

I assume that you are deep in labeling discussions on terzapotide. What questions is FDA asking? Are you anticipating the label to read that terzapotide is a first-line injectable or for use after other injectables fail? And since another very well-managed diabetes competitor has had supply issues, I'm curious where terzapotide is being manufactured and whether the plant has been inspected. Thank you.

Thank you I assume that you are deep in labeling discussions on tours appetite what questions as the FDA asking are you anticipating the label to read that turns appetite as a first line injectable or for use after other injectables fail.

And since another very well manage the diabetes competitor has had supply issues I'm curious, where <unk> appetite is being manufactured and whether the plant has been inspected. Thank you.

Yes.

We'll go to Mike Mason for both of those questions. Thanks, Steve, for the question. The Persepatide submission in the US is going quite well. No surprises there. We are not getting any unusual questions.

Thanks, Steve we'll go to Mike Mason for both of those questions.

We're confident in our supply and confident in our supply chain. We'll be ready for long, um, you know our we did a comprehensive study for our surpassed five pivotal studies for the U.S. So I think that'll give us a broad lead and the label we need for success. So I think things are progressing quite nicely, and we're quite confident going into our launch. Thanks Mike, and. Well, thanks for the question, Steve. Next caller, please. The next caller is Chris Satt with J.P. Morgan. Please go ahead. Great, thanks so much.

Thanks, Steve for the question.

The <unk>.

There is appetite submission in the U S is going quite well no surprises in that.

We are not getting any unusual questions.

We're confident in our supply.

And confident in our supply chain.

It will be ready for launch.

We did a comprehensive studies for our surpass.

Five pivotal studies for the U S. So I think that'll give us a broad label in the label we need for success, So I think Nathan.

Are progressing quite nicely and we're quite confident going into our launch.

Thanks, Mike.

And.

Well thanks for the question Steve next caller please.

The next caller is Chris Schott with Jpmorgan. Please go ahead.

Maybe just following up on the trisepatide front, can you maybe also set some expectations for the launch as we think about 2022 into 2023? So maybe specifically, how long should we think about post approval before you'd expect broad coverage of trisepatide? And when we maybe compare and contrast, I guess, the large, the last large GLP-1 launch of Ozempic, are there similarities or differences we should think about as we think about kind of the state of the market today, the data you'll have, etc., just to help us? I think we all think about this as a great long-term opportunity, but more just the nearer-term dynamics with that.

Great. Thanks, so much maybe just following up on the trees appetite front can you just to help maybe also set some expectations of the launch as we think about 2022 into 2023, so maybe specifically how long should we think about post approval until you would expect broad coverage of trees appetite and when me maybe compare and contrast.

So I guess the large the last large GOP one launch of Olympic.

And then my second question was just on insulin in 2022. Can you just elaborate a bit more about how to think about the magnitude of price erosion we could see for that franchise relative to what we saw in 2021? I'm trying to get a sense of how different the market dynamic is this year versus versus last.

Are there similarities or differences, we should think about it think about kind of a state of the market today. The data you'll have et cetera, just to help us I think we all.

Think about this as a great long term opportunity, but more just the near term dynamics with that.

Then my second question was just on insulin in 2022 could you just elaborate a bit more about how to think about the magnitude of price erosion, we could see for that franchise relative to what we saw in 2021 I'm trying to get a sense of how different is the market dynamic I guess this year versus versus last thanks.

Thanks, Chris we'll go to Mike for both of those questions as well.

Thanks. Thanks, Chris. We'll go to Mike for both of those questions as well. Yeah, thanks for the questions. As we approach the Terps Appetite launch, we'll be playing for the long term and making sure that we set the foundations up strongly for long-term success. You know, when you have a retail product like this that goes to, you know, nearly 100,000 primary care physicians, as well as needs broad access, there's little that you can do to really accelerate the launch in the first six months. You're also working to get access, and have And so I wouldn't look for the first six months to see a real accelerated, you know, uptake of net revenue versus other GLPs.

Yes, thanks for the questions.

We approach towards appetite launch will be playing for the long term and making sure that we set the foundations up strongly for long term success.

You have a retail product like this that goes to.

Nearly 100000 primary care physicians as well as leading broad access.

There is little that you can do to really accelerate the launch in the first six months, you're also working to get access and having the support program. So patients will have a good outlook.

Pocket experience at launch.

And that first six months, I think that that'll be a focus for us, just laying a strong foundation, be an inpatient focus, getting access, driving awareness to a broad subset of physicians, that will give us that foundation to be successful. Wong-Turk. And then on insulin, you know, when we look at the Q4 results, we did have a, in particular, a greater than usual decline in our price. And that was really due to kind of a double whammy effect, you know; we had significant adjustments from our growth sales to our net sales.

So I wouldn't I wouldn't look for the first six months to see a real accelerated uptake of net revenue versus other dlp's in that first six months I think that that'll be a focus for us.

So just laying a strong foundations being patient focus getting access driving awareness through a broad subset of physicians that will give us that foundation to be successful long term.

And then on to insulin.

When we look at the Q4 results we did have.

In particular.

A greater than usual decline.

In our.

Our price and that was really due to kind of a double whammy effect, we have a significant adjustments from our gross sales through our net sales and so our estimates are off just a little bit that can have a significant impact on our net revenues and so what we saw actually was that in.

And so if our estimates are off just a little bit, that can have a significant impact on our net revenues. And so what we saw actually was that in the comparison period, in Q4 2020, they experienced some positive one-time gains, and then in this quarter, we saw some negative one-time adjustments.

In the comparison period.

In Q4 of 2020, they experienced some positive onetime gains.

And then in this quarter, we saw some negative one time adjustments so that that's what led what looks like.

So that's what led to what looks like, you know, a greater than expected decline in net sales. You know, I think for our portfolio, we have provided guidance that we would be at, I think we'll see that greater for insulin than our net portfolio, but I don't see anything, you know, largely unexpected, in 22 versus where we've seen the trends over the last couple of years. Maybe just to add something there, Chris, that's a dynamic as well as patient assistance.

A greater than expected.

Net sales decline.

I think for our portfolio, we are providing guidance that we would be at.

You know mid single digit decline I think we'll see that greater insulin than our than our net portfolio, but I don't see anything largely unexpected in 'twenty two versus where we've seen the trends over the last couple of years.

Thank you.

Maybe just to add something there Chris Thats.

A dynamic as well as patient assistance and as you know, though he has led over the last three years with a number of solutions to reduce out of pocket costs given the problems in the insurance markets.

And, you know, as you know, Lilly's led over the last three years with a number of solutions to reduce out-of-pocket costs, given the problems in the insurance market, and those have been a you know in addition to the normal competitive dynamics in terms of gross to net you know an important solution for patients actually out-of-pocket costs for correcting Mike if I get this wrong for patients in the U.S. dropped over the last three years from $34 to $21 per month on average for Lilly Insulin that's quite a bit lower than our competitors but that does hit the price line for us either through the now 70% off Insulin Lice Pro product which is available or through the buy downs we do at the point of sale to $35 per month so that's in the background there is sort of a terminal quantity to that but we have seen good adoption and I guess the good news is patients are taking advantage of that and it's showing up and retaining volume it does hit the net price line. Thanks, Dave and Mike.

And those have been in addition to the normal competitive dynamics in terms of gross to net and important.

Solution for patients actually out of pocket costs for correctly, Mike If I get this wrong for patients in the U S dropped over the last three years from $34 to $21 per month on average for Lilly insulin. So that's quite a bit lower than our competitors, but that does hit the price line for us either through.

Now, 70% off insulin life pro product, which is available or through the buy downs, we do at the point of sale to $35 per month. So.

That's in the background there is sort of a terminal quantity to that but we have seen good adoption and I guess the good news is patients who are taking advantage of that and it's showing up in retaining volume. It does hit the net price line, though.

Okay.

Chris, thanks for your questions. Next caller, please. The next caller is Tim Anderson from Wolf Research. Please go ahead. Hello, thanks for taking our question. This is Alice Nettleton on behalf of Tim Anderson.

Thanks.

Chris Thanks for your questions next caller. Please the next caller is Tim Anderson from Wolfe Research. Please go ahead.

Hello, Thanks for taking our question. This is Alex Hutter Wilson on for Tim Anderson.

So a question on Denonimab; the premise with Denonimab is that you only dose to plaque negativity. However, to determine black negativity, you need a minimum of two PET scans, and quite possibly three. Maybe even more. The CMS draft guidance only covers one, even if it ultimately gets revised to be more generous.

A question on the non mob.

Premise with Jnana mob is that you have any days two o'clock negativity.

Over to the Thailand, Black negativity, you need a minimum of a pet scan.

And quite possibly three maybe even more.

The CMS draft guidance Andy covers one even if it ultimately gets revised to be more generous.

If it doesn't also include increased coverage of PET scanning, then you could argue Lilly is uniquely disadvantaged versus competitors. Would be curious to hear your thoughts on this. Thank you.

If it doesn't it looks they include increased coverage of pet scanning then you could argue nearly as uniquely disadvantage them.

Thus as competitors.

I'd just be curious to hear your thoughts on that thank you.

Thanks Al So we'll go to and wait for that question.

Well, thanks. And as you said, we're pleased that CMS acknowledged that there's an important role for amyloid PET in patient identification. We certainly agreed to that as well. And using amyloid PET to monitor plaque reduction and then confirm clearance is incredibly important, we believe, for patients receiving these therapies and incredibly important for the healthcare system because it provides clarity as to when you can essentially stop dosing a medicine.

Thanks, and as you said, we're pleased that CMS acknowledged that there is an important role framework pets in patient identification, we certainly agree to that as well and using amyloid pet to monitor plaque reduction and then confirm clearance is incredibly important we believe for patients are receiving these therapies and incredibly important for the health care system because.

It provides clarity as to when you can essentially stopped dosing of medicine once you've cleared the target and we believe that's the time to to stop dosing and as you know in our data we've shown that 40% even clearer there plaque in six months. So incredibly important that we believe that the value that that brings to the health care system far outweighs.

Once you've cleared the target, we believe that's the time to stop dosing. And as you know, in our data, we've shown that 40% even clear their plaque in six months. So incredibly important.

Any cost to that it might bring in we've done those analyses. So it's very very clear that when you take into account all the cost of these medicines the infusion the safety monitoring you're much better off with with clarity of when that plaque is cleared and stopping dosing is a unique attribute of donana mab that we've certainly talked to CMS and others about and they've recognized.

And we believe that the value that this brings to the healthcare system far outweighs any cost that it might bring. And we've done the analysis. So it's very, very clear that when you take into account all the costs of these medicines, the infusions, the safety monitoring, you're much better off with clarity of when that plaque is cleared and stopping dosing it. It's a unique attribute of Dananamab that we've certainly talked to CMS and others about, and they've recognized it. So we believe the value proposition here is quite strong and look forward to working with CMS to get the amyloid PET, CED revised in the near future. Thanks, Anne.

So we believe the value proposition here is quite strong and and look forward to working with CMS to get the amyloid pet.

<unk> revised in the near future.

Alice, thanks for your question. Next caller, please. The next caller is Andrew Baum with Citi. Please go ahead. Thank you. Question on nebrokismab and then one on basemios.

Thanks, and thanks for your question next caller please.

The next caller is Andrew Baum with Citi. Please go ahead.

So on nebrokismab, part of the premise in terms of differentiation versus DUPI, given the IR-13 mechanism is a lower instance of ocular events, particularly conjunctivitis, which are frequent with DUPI and occasionally problematic. I know you haven't fully shared the data, but I wonder whether you could talk about whether the data will support that premise and positioning in the market. And then second, in relation to basemios, given you're now rolling it out for the adjuvant setting, could you talk about what are the key barriers to adoption among oncologists? Is it tolerability in the adjuvant setting? Is it screening for T67 patients or some other financial factor? And how can you resolve it?

Thank you question on.

Replicate some math and then one of them does that mean is that the case.

The planets.

In terms of differentiation versus <unk>.

Given the <unk> mechanism is another instance of ocular events, particularly conjunctivitis, which are frequently with upa patient problematic.

I know you haven't fully shared the data, but I wonder whether you could talk to whether the data will support that premise and positioning in the market and then second relation to <unk>.

Given you have not voted gets out for the accident setting could you talk to what are the key barriers to adoption. Among oncologists is it tolerability in the adjuvant setting is at screening for the 67 patients was somehow financial factors.

Hi, <unk>. Thank you.

Thank you. Thanks, Andrew. We'll go to Patrik for the question on Leberkizumab and then to Jake for the question on Brasenio.

Thanks, Andrew we'll go to Patrik for the question on <unk>.

And then Jay for the question on <unk>.

Thank you very much, Andrew. Based upon the data that we've seen so far, we believe that we have a competitive asset with a market leader for atopic dermatitis. And we were very encouraged with the efficacy results, with more than 50% of the patients achieving at least an EASI of 75, and also consistent across all the different measures, including EGA, EASI-90, and Brutus NRS, and met all the key secondary endpoints. Specific to your question on conjunctivitis, we need to wait for the 52-week data.

Sure Andrew.

Based upon the data that we've seen so far we believe we have a competitive assets with a market lead on it and what our topic dermatitis and we were very encouraged with Ampycus episodic way more than 50% of patients achieving at least <unk> 75, and also consistent across all the different mesh of Iga E E.

As <unk>, <unk> and <unk> and all that.

It met all the key secondary endpoints specifically to your question on Coyote devices, we need to wait for the 52 week data and the induction date that we didn't see any difference to existing biologics at the cases that we saw were all mild to moderate and one third of those had a history of client devices and only a few of them discontinue treatment.

In the induction data, we didn't see any difference between existing biologics, but the cases that we saw were all mild to moderate, and one-third of those had a history of conjunctivitis, and a few of them discontinued treatment. So we're looking forward to the database lock of the maintenance treatment during the first half of this year. This is Patrick, Jake. Yeah, thanks for the question.

We're looking forward to the database lock of a maintenance treatment.

Second thoughts off of this year.

Thanks, Patrick.

Yes.

So, as it relates to the key barriers to adoption, I think the biggest one and the overlay, and then I'll get more specific, is just that this represents really the first new standard of care in this setting in 20 years. And so there are just a lot of physicians who have entrenched behaviors and comfort with what they're doing. And so the first barrier is really around education and getting a comfort level with changing behavior.

Yes. Thanks for the question. So I think as it relates to the key barriers to adoption and I think the biggest one in the overlay and then I'll get more specific is just that this represents.

Really the first new standard of care in this setting in 20 years and so there's just a lot of physicians, who have infringed behavior and comfort with what they're doing and so the first barrier is really around education, and getting a comfort level changing behavior.

So we have a lot of tactics in place to do that to make sure that the data on the agent are known and to answer questions that physicians may have.

And so, you know, we have a lot of tactics in place to do that, to make sure that the data on the patient are known and to answer questions that physicians may have. More specifically, you highlighted a few things that are good things to know, such as the key 67 testing requirement and the interpretation of those results and integrating them into patient selection is a new thing for docs in this setting, as well as diarrhea management, which, you know, is a real phenomenon with Fresenio.

More specifically you highlighted a few things that are that are good things to know which is the key 67 testing requirement and the interpretation of those results and integrating them into patient selection is a new thing for docs in that setting as well as the diarrhea management, which is a real phenomenon with with <unk>, we have protocol.

<unk> in place that allow it to be managed and it tends to be a short term.

We have protocols in place that allow it to be managed, and it tends to be a short-term side effect that can be managed. But, you know, there are a lot of physicians out there who've literally never written a prescription for Fresenio because they've been historically large iBranch users.

That short term side effects that can be managed but there are a lot of physicians out there who.

It really never written a prescription of presenting them because they've been historically large eye brands users and for that segment. In particular, there was an education component to get them comfortable and ensure they're using the protocols that we think work really well for diarrhea management.

That all having been said, we're happy with what we're seeing so far but it is early days obviously in this launch trajectory.

And, you know, for that segment in particular, there's an education component to get them comfortable and ensure they're using the protocols that we think work really well for diarrhea management. All that having been said, we're happy with what we're seeing so far, but it is early days, obviously, in this launch. This is Jake. Andrew, thanks for your questions. Next caller, please. The next caller is Geoff Meacham from Bank of America. Please go ahead. Morning, everyone. Thanks for taking the question. Just have a couple of quick ones.

Thanks, Jake Andrew Thanks for your questions next caller please.

The next caller is Geoff Meacham from Bank of America. Please go ahead.

Good morning, everyone. Thanks for taking the question.

Just have a couple of quick ones for tours appetite in obesity.

For terzapatite and obesity, what investments have to be made to help change payer attitudes towards obesity as more of a medical condition? Obviously, it has a lot to do with, you know, benefit risk, starting with the biggest one, and you have a competitor leading the charge as well. And then the second question is for Perch and Brutenev: was the decision to file an MCL based more on unmet need and opportunity versus regulatory feedback?

Our investments have to be made to help evolve the payer attitudes towards obesity is more of a medical condition. Obviously has a lot to do with benefit risk starting with surmount want it and you have a competitor leading the charge as well.

And then the second question is for parts of Britain.

Decision to file an mcl it was it based more on unmet need and the opportunity versus regulatory feedback wanted to get a little bit more clarity on that and with the phase III.

I want to get a little bit more clarity on that. And with phase three, and CLL not completing for at least a few years, was there more consideration for those towards an interim look being built in?

And seal CLO not completing for at least a few years was there more consideration.

For those who are towards an interim look being built and I'm just trying to think of the potential lag and commercial availability between the two indications.

I'm just trying to think of the potential lag and commercial availability between the two indications. Thank you. Jeff, we'll go to Mike for the first question and then Jake for the second. That's a good question on VC and what it's going to take to unlock and build that marketplace. You know, when you look at the historical data, you see the agents just had kind of limited weight loss, and because of that, they didn't really drive.

<unk>.

Thanks, Jeff will go to Mike for the first question and then Jay for the second.

Yes, it's a good question on <unk>, and what's going to take the unlock and build that marketplace.

When you look at historically.

The agencies had unlimited weight loss and because of that they didn't really drive.

Good help out, and that limited access, limited positions from riding. So, you know, we think, first of all, just having an agent like First Appetite that could have significant..., and the Clinically Meaningful Weight Loss, is the first step of the evolution of the marketplace. And we've seen that in market research. And then, you know, we've got to begin to build the evidence to show that significant weight loss from Traceptide will lead to heart outcomes.

Good health outcomes and that limited access limited physicians from Ryan.

So we think first of all just having an agent like <unk> appetite that can have significant and clinically.

For weight loss.

As the first step of.

Evolution of the marketplace and the interest in that and we've seen that in market research and then we've got to begin to build the evidence to show that significant weight loss from his appetite will lead to heart outcomes and that's what we're doing in our.

And that's what we're doing in our extended indication focus. We've announced a heart failure study. We announced in December a Sleek Aptian study as well as an important part of the Morbidity and Mortality Study or MMO study that will look at heart outcomes for other potential outcomes like CV, and others will give you more information on that coming up. We also have a chronic kidney disease mechanisms of action phase two study that will help demonstrate why Traceptacide may work for that and work in NASH.

Extended.

Indication focus.

We've announced a heart failure.

And.

We announced in December .

Sleep apnea study as well as an important move.

The mortality study or MMO study that will look at hard outcomes for other potential outcomes like CV and others will give you more information on that.

Coming up we also have a chronic kidney disease mechanism of action phase III study that will help.

Industry wide was appetite may work for that type of patient population.

And doing work in Nash and so I think it's important for us to demonstrate.

And so I think it's important for us to demonstrate that we're confident that with the level of weight loss that we'll see with traceptide, that should lead to hard outcomes that should then lead to earlier use of an agent like traceptide to really slow and disrupt the progression of ABC and really turn this into more of a preventive versus waiting for the heart to fail. But that's going to be the evolution of it.

Compound that with the level of weight loss, but we'll see what the receptor tied but that shouldn't be too hard outcomes that she didn't lead to.

Early reviews.

Are they using Microsoft peptide to really slow a disruptive progression of abuse.

Really turned this into a more of a preventive.

Versus waiting for the heart outcomes.

So it's a show, but that's going to be the evolution of it.

We've got an extensive phase three program in order to demonstrate the evidence we think we need to in order to unlock and grow access. Thanks Mike. Jake, I'm Kurt Arutnitz.

We've got an extensive phase III program in order to demonstrate the evidence we think we need to in order to unlock and grow access overtime.

Thanks, Mike and Jacob <unk>.

Yeah.

Yeah, so the first part of your question around the decision to file for mantle cell, you framed it as what's an unmet need versus regulatory feedback, and the answer really is both. So, you know, we've had a long conversation with the agency around this indication, showing them our clinical data at various snapshots over time, and we got to a point where we agreed on the key components of what an NDA could look like from a clinical package perspective. And so that's what informed our decision to file. In other words, this was not a sort of unilateral Lilly decision.

Yes. So the first part of your question around the decision to file or for mantle cell.

You framed it as what that unmet need versus regulatory feedback and the answer really is both so we've had a longitudinal conversation with the agency around this indication showing them our clinical data at various snapshots over time, and we got to a point, where we had agreement on on the key components of what an NDA could look like from a <unk>.

Michael package perspective, and so that's what that was that informed our decision to file in other words. This was not a sort of unilateral Lilly decision. This was done very much in concert with FDA and I think they and us realize the unmet need of patients in that setting and the potential proposition.

This was done very much in concert with FDA. And I think they and us realize the unmet need of patients in the setting and the potential proposition of Perto Bruno there. Obviously, the ultimate approval is subject to FDA review. So nothing's done until it's done, of course.

As it relates to the potential lag between a mantle cell approval and a CLL approval, I think it's just too early to really comment because the latter CLL is really subject to the enrollment dynamics of the phase three program, and it's just a little too early days for us to really say exactly which one of those studies will be the first to read out and when because it is so enrollment kinetics contingent. So you know, over the Geoff, thanks for your questions. Next caller, please. The next caller is Louise Chin from Kantor. Please go ahead. Hi, thanks for taking my question. So my first question is about leprosy.

Burden of there obviously the ultimate approval is subject to FDA review, so nothing's done until it's done of course.

As it relates to the potential lag between mantle cell approval and CLO approval I think it's just too early to really comment because the latter cielo is really subject to the enrollment dynamics of the phase III program and it's just a little too early days for us to really.

Say exactly which one of those studies will be the first to read out and win because it is so enrollment kinetics contingent so over the course of this year, we'll have a lot more information about that I presume and be in a better position to prognosticate about CLO timing.

Thanks, Jake Jeff Thanks for your questions next caller please.

The next caller is Louise Chen from Cantor. Please go ahead.

If it's approved, do you expect sales to come from share gains from Dupixent or new patient starts? And then the second question is on protobrutinib. Do you see an opportunity for the drug in first-line treatment? And if so, do you think you need to wait for the head-to-head results before that becomes a meaningful opportunity for you?

Hi, Thanks for taking my question. So my first question is on leverage is the math.

Do you expect sales to come from share gains from <unk> or new patient starts and then second question is I heard Ibrutinib do you see an opportunity for the drug in first line treatment and if so do you think you need to wait for that head to head results before that becomes a meaningful opportunity for you. Thank you.

Thank you, Thanks, Louise. We'll go to Patrick for the question on leberkizumab, a source of business, and then back to Jake on protobrutonib. Thank you very much, Ruiz. I think first and foremost, if we look at the atopic dermatitis space, it's pretty much where psoriasis was a decade ago, and we see very low biologic penetration into those patients in need of treatment beyond topicals today, so we definitely see an opportunity to significantly grow the market for atopic dermatitis. But, as I mentioned earlier, we also believe that we have an asset here, but it's Thanks, Patrick.

Thanks, Louise we'll go to Patrik for the question on level. His mab source of business and then back to Jake on <unk>.

Thank you very much Gary I think first and foremost if you look at the topic on my part at this stage, it's been masked without sort of Iot as well as a decade ago, and we see a very low biologic penetration into those patients in need of treatment beyond topical today. So we definitely see an opportunity to significantly grow the market in atopic dermatitis, but as I mentioned earlier, we want to be.

But we have an answer to you, but it is very competitive with the market leader. So I would placebo, we will see an.

Uptake both in terms of driven by market growth. That's the way it is competing very successfully with it makes sense.

Thanks, Patrick J.

So, the protobrutinib opportunity we see primarily, and certainly initially, is in patients who've been previously treated with a BTK inhibitor or more. Obviously, we think there's potential for the drug in the first line, and that's why we're running studies there. We have two studies that we're running in first-line TLL. One is, as you mentioned, a head-to-head study against dibrutinib. The other, which will take a long time to read out because of the natural history of the control arm.

So the partner portal burden of opportunity, we see primarily in certainly initially is in patients who've been previously treated.

With a <unk> inhibitor or more.

Obviously, we think there's the potential for the drug in the first line and that's why we're running studies. There. We have two studies that were running in personal lines. CLO. One is as you mentioned the head to head study against Ibrutinib, the other which will take a long time to read out because of the natural history of the control arm.

The other is a study we just recently started against chemoimmunotherapy. That study will read out much, much quicker and therefore allow for the drug to be labeled in the first line setting. And I think what we've learned, particularly from other newer entrants in this space, is that you really need to generate a differentiating data set in some way, shape, or form, and then have the labeled indications that allow physicians and patients to have choice.

The other is a study we just recently started against chemo immunotherapy that study will read out much much quicker and.

And therefore allow for the drug to be labeled in the first line setting and I think what we've learned particularly from other newer entrants in this space is that.

You really need to generate differentiating dataset in in some way shape or form and then have the labeled indications that allow physicians and patients to have choice.

And I think, in particular, the CalQuint's A-Calibrutinib program has shown that you really don't necessarily need direct head-to-head data to suggest differentiation, or for at least physicians to perceive differentiation in different drugs, so long as you have a labeled indication that allows for unlabeled prescribing and reimbursement.

And I think in.

Pickler the calc once a caliber route and that program has shown that you really actually don't necessarily need the.

Direct head to head data to suggest differentiation or for at least physician to perceive differentiation.

Different drugs. So long as you have a labeled indication that allows for for on label prescribing and reimbursement.

So one of the reasons that we initiated the first line chemo immunotherapy study was to have a path to that first line label more quickly and allow patients and physicians to make choices. Jake, Lilly, thanks for your questions. Next caller, please. The next caller is Umar Rafat with Evercore ISI. Please go ahead. Hi guys, this is Mike in for Umar. Thanks so much for taking my question. There are two for me, one on triseptide.

One of the reasons that we initiated the first line chemo immunotherapy study.

Was to have a path to that first line label more quickly and allow patients and physicians to make choices.

Thanks, Jake Louise Thanks for your questions next caller please.

The next caller is Omar Saad with Evercore ISI. Please go ahead.

If triseptide is priced at a slight premium over trulicity on a list basis, that could theoretically mean a massive increase on a net basis. So given where prices are paid in government channels for trulicity, can you remind us what percent of trulicity is Medicare, Medicaid, and VA? And how different is that price versus your commercial price?

Hi, guys. This is Mike in for Omar. Thanks, So much for taking my question just two for me one on <unk> appetite.

If <unk> is priced at a slight premium Uber culicidae on the list basis that could theoretically mean, a massive increase on a net basis, so given where prices are paid.

And in government channels for Culicidae.

Can you remind us what percent of choices as Medicare Medicaid and VA and how different is that price versus your commercial price and such.

Switching gears to <unk> for Trailblazer, three I was wondering if you guys had finalized the stat methodology for assessing the primary endpoint I know a little while back you had a nice pusher on trailblazer, two showing how the primary endpoints were assessed by a Bayesian analysis.

And then Martin just kind of remind us where if anything has been finalized for the.

Methodology for assessing the primary endpoint and trailblazers rate. Thank you.

And switching gears to Denenimad, for Trailblazer 3, I was wondering if you guys had finalized the statistical methodology for assessing the primary endpoint. I know a little while ago, you had a nice poster on Trailblazer 2, showing how the primary endpoints were assessed via Bayesian analysis versus, you know, MMRN. Just kind of remind us where, if anything, has been finalized for the methodology for assessing the primary endpoint for Trailblazer 3. Thank you.

Thanks, Mike. We'll go to Mike Mason for the questions around terseptide pricing and trilicity segments in the U.S. and then Dan for the question on TrilBlazer 3. Mike?

Thanks, Mike we'll go to Mike Mason for the questions around <unk> appetite pricing and <unk> segments in the U S. And then Dan for the question on Trailblazer three Mike.

Thanks, Mike, for your question. Obviously, I won't be able to talk in too much detail about the list price or next price for triseptide. Maybe the best way to answer your question is that, you know, typically for a new product, you tend to get commercial access for it, then Part D, then followed by Medicaid and other chances. And yes, the commercial net prices are typically higher, and Part D is typically higher than many.

Thanks, Mike for your question, obviously, we won't be able to talk in too much detail around the list price for next price for tours appetite.

Maybe the best way to answer your question is that typically when a new product you tend to get commercial access for.

In part D. Then followed by Medicaid in other channels.

And yes, the commercial net prices are typically higher than part D and part D is typically higher than the Medicaid. So you will see kind of the evolution of any retail prana.

So you will see kind of the evolution of any retail product, to be a higher net price at the beginning of the life cycle. But if you reach volume in lower price segments, you'll see that decline. We talked about it with Trulicity over the last couple of years. Now, we will have extensive patient support programs in the first six months. So again, I wouldn't be looking too much at that for traceptive activity in the first six months. But overall, the first couple of years.

To be a higher net price at the beginning of <unk>.

Of the lifecycle and then as the lower <unk>.

Reach volume and lower price segments Youll see.

That decline.

We've talked about it.

Over with velocity over the last couple of years now we will have extensive patency patient support programs in the first six months for cruise hepatitis. So again I wouldn't be looking too much at.

At that fortress appetite in the first six months, but overall over the first couple of years.

I think any product you'll see that dynamic, for your specific question on Medicaid, which realistically, is currently around 10%. Thanks, Mike. Dan

I think any product you'll see that that dynamic.

For your specific question on Medicaid.

Let's see that's currently around 10% of the volume.

Thanks for the question.

Thanks, Mike Dan.

Yeah, thanks, Mike, for the question on Trailblazer 3. It's a good question you raised, because this is a really interesting population. These are patients who have amyloid plaque in their brains, but they're still cognitively normal. So, you know, what kind of endpoint is appropriate for a population like that? In our view, we're looking at a progression metric. So do they progress to a CDR rating that indicates that they now have impairment? So it's a bit of a binary outcome for each patient: did they progress, or did they not progress?

Yeah. Thanks, Mike for the question on Trailblazer three it's a good good question. Your agency because this is a really interesting population. These are patients who have amyloid plaque in the brain, but theres still cognitively normal.

What kind of endpoint is appropriate for a population like that in our view were looking at a progression metrics. So do they progressed to a C.

Ctr or rating that indicates that they now have impairment. So it's a bit of a binary outcome for each patient that they progressed or did they not progress.

And then you have an event-driven study with a Kaplan-Meier type analysis. So that's how we're thinking about Trailblazer 3 right now. And probably we haven't published a design paper yet, but that may yet be forthcoming. And that study is currently enrolling patients. Thanks, Dan.

And then you have our event driven study.

With a Kaplan Meier type analysis. So that's how we're thinking about trailblazer three right now and probably we haven't published it on paper, yet but that may yet.

Be forthcoming.

That study is currently enrolling.

Thanks, Dan Mike. Thanks for your questions next caller. Please the next caller is Carter Gould with Barclays. Please go ahead.

Mike, thanks for your questions. Next caller, please. The next caller is Carter Gould with Barclays. Please go ahead. Good morning.

Thanks for taking the question. I guess just first for Dan, maybe to clarify, I mean the language you're using around not longer Q1, I noticed you guys weren't explicitly confirming to 2Q. So maybe just clarifying then: is that sort of time unknown just still sometime in 22 or so? Shibutani.

Good morning, Thanks for taking the question I guess just.

First for Dan, maybe maybe to clarify the language you're using around no longer Q1, I noticed I guess, you guys weren't explicitly confirming to <unk>.

Just maybe just clarifying then is that sort of time unknown to fill sometime in 'twenty two or.

Is it just going to kind of fill over by a couple of weeks or months and then maybe for Jake on on pivot. When we spoke in December I thought you were pretty balanced if not even maybe negative on the prospects for approval based on some of the commentary around data coming out of China now that you've got the questions in hand, I don't know what your stance has changed your view any additional color to add.

Thank you.

Thanks, Carter will go to Dan for the question on demand a mab and then Jake.

Until <unk> in the U S. Yes, thanks Carter.

You noted it correctly, which is that we're saying it's no longer Q1 and not providing more specificity than that. However, we do anticipate completing the submission yet this year. I think importantly here, we're trying to take investor focus off of the exact timing of accelerated approval, given our very limited expectations for the impact of that accelerated approval commercially. But we're still pursuing it. We think there's some opportunity to help patients faster through it, but I don't think investors should look at that as a big commercial inflection point.

Exactly you noted it correctly, which is that we're saying no longer Q1, and not providing a more specificity than that we do anticipate completing the submission yet this year I think importantly here, we're trying to take investor focus off of like the exact timing of accelerated approval given our very limited expectations for the impact of that accelerated approval.

Commercially.

Pursuing it we think there's some opportunity to help patients faster through it.

But I don't think investors should look at that as a big commercial inflection point, its really around our ability to communicate the trailblazer two confirmatory phase III data.

It's really around our ability to communicate the Trailblazer 2 confirmatory phase 3 data and then work with CMS, hopefully before that or immediately after that, to make sure there's access once we have that confirmatory data. So that's the timing I think investors should be focused on. Thanks, Pam.

And then work with CMS, hopefully before that or immediately after that to make sure. There's access once we have that confirmatory data. So that's that's the timing I think investors should be focused on.

Thanks Jay.

Thanks for the question on Centelimab. So, as you know, we have the FDA Advisory Committee meeting within events a week from today. Our position on the matter really hasn't changed, nor have our expectations.

Thanks for the question on <unk>. So as you know we have the FDA Advisory Committee meeting within events a.

A week from today.

Our position on the matter really hasnt changed nor has our I've never have our expectations, but we believe that the risk benefit of the agent is.

We believe that the risk-benefit of the agent is demonstrable on the basis of the well-conducted study, and we believe the results of the study are indeed applicable to a U.S. population, and we'll make our case in that respect a week from today. That having been said, you know, we understand the stance of the agency may have changed, or maybe we misinterpreted it a few years ago. And so we'll await the FDA's presentation on that topic and the feedback from the ODAC members.

Demonstrable on the basis of the well conducted study and we believe the results of this study are indeed applicable to the U S population and.

We will make our case in that respect a week from today.

That having been said we understand the stance of the agency may have changed or maybe we missed misinterpreted it a few years ago and so.

We will await the fda's presentation on that topic and the feedback from the OPEC members.

But, you know, we think this product, if approved, could be meaningful for patients in the United States as a result of our disruptive pricing strategy, but we obviously don't know if we'll be able to execute on it. Thanks, Jake.

But we think this product if approved could be meaningful for patients in the United States as a result of our disruptive.

Pricing strategy.

We obviously don't know if we'll be able to execute on that.

Carter, thanks for your questions. Next caller, please. The next caller is Kerry Holford from Beringburg. Please go ahead. I thank you. Two questions, please.

Thanks, Jade Carter Thanks for your questions next caller please.

Next caller is Kerry holford from bearing Baird. Please go ahead.

Firstly, on Illumia... I wonder if you could break out for us a proportion of sales in the courses that were related to using code and what your expectations are here going forward, and also whether you can expand on the discussions you've had with the FDA on the atopic dermatitis indication and why. I think CLL could be forthcoming.

Hi, Thank you two questions. Please.

Sure.

How long do you see current rig counts and propulsion is sound and our call Center.

Okay.

Emily Yang could potentially.

Carrying forward.

And I know, it's everything you can expand on the discussions and constantly.

Unrelated come from time to time from colon cancer in Hawaii.

The forthcoming.

If additional studies were to be required, would you continue to pursue this in this syndication? And then secondly, on the information we have said, we obviously have the positive headline data from phase three. I'm wondering when you will publish the full data and whether we'll get to see that ahead of your filings. Thank you. Okay, thanks, Kerry. We'll go to Patrick for those questions. Okay, thank you very much.

The proportion of the studies, but keeping our clients can continue to pay.

<unk> in this indication.

And then secondly on the Internet.

Obviously, you have the positive headline data from the phase III.

I'm wondering when you will publish the full data.

We'll get to see that I had.

Filings.

Sure.

Okay. Thanks, Kerry, we'll go to Patrik for those questions.

Let's start with Illumions and COVID-19. If you look at the Q4 performance of Illumions, I think you should assume that the underlying business for rheumatoid arthritis outside of the US and atopic dermatitis continues to be strong. And in the US, the trend hasn't changed either when it comes to rheumatoid arthritis.

Thank you very much it itself with no amounts of COVID-19, and if you look at the Q4 performance of a New Orleans I think you should assume that the underlying business I thought I'd try it is outside of the U S. In atopic dermatitis and continued to be strong and in the U S. The trend Hasnt changed die, but when it comes out on my thought that's why it is so in the U S.

So in the US, a significant chunk of Illumions sales are coming from COVID-19 in Q4 and a minor chunk outside of the US as well. It's really hard to predict the pandemic, but we expect to see continued sales from Illumions in 2022 for treating hospitalized patients with COVID-19. However, at an enterprise level, we don't foresee it being material. For your second question about atopic dermatitis, let me first reinforce that we are very confident when it comes to the risk-benefit profile of Illumiant across all the indications approved and studied. We conducted eight phase-three studies for atopic dermatitis in the U.S. and outside of the U.S., and both were conducted in moderate to severely ill patients suffering from atopic dermatitis in need of systemic treatment.

<unk> Hussain from Illumina is coming from COVID-19 in Q4, and a minor Jacques Kallis side of the U S. S. With it's really hard to predict the pandemic, but the we expect to see continued savings from Illumina and doors are in 'twenty to 'twenty two for treating hospitalized patients with COVID-19, however at an enterprise level.

We can fill in for a couple of minutes. And then maybe for Jake, on Tivit. When we spoke in December, I thought you were pretty balanced, if not even maybe negative, on the prospects for approval. And we're going to continue our commentary on data coming out of China. Now that you've got the questions in hand, I don't know if your stance has changed or if you have any additional questions. Thanks, Carter. We'll go to Dan for the question on Denanamab and then Jake on Centilumab in the U.S. Yeah, thanks, Carter. Exactly like that.

<unk> foreseen to be material.

For your second question in terms of atopic dermatitis, and let me reinforce that we are very confident when it comes to various benefit profile of illumina onto across all the indications approved and started and we conducted a phase III studies.

Topic dermatitis in U S and outside of the U S and both were conducted in the patient's moderate to severely ill patients suffering from atopic dermatitis in need of systemic treatment and that's really why we believe <unk> TSA, bringing the biggest benefits to patients early on in the treatment paradigm, while FDA currently.

That's really where we believe Illumiant is bringing the biggest benefits to patients early on in the treatment paradigm, while FDA currently has a position of saving Illumiant for refractory patients, where we see the incremental value of Illumiant to be quite limited. And if that doesn't change, it's likely that we will receive a complete response letter. And if so, we will continue to focus our efforts on the very successful launches that we're seeing outside the U.S. for atopic dermatitis, as well as the very strong rheumatoid arthritis franchise we have there, as well as preparing for, hopefully, an approval of alopecia areata in the U.S. and other markets later this year.

That's a position of saving illumina in the fall the refractory patients with either incremental value of Blue mountain to be quite limited.

And if that doesn't change it's likely that we won't see receive a complete response letter and if so we will continue with the folks at anthro with somebody.

Successful launches that we have seen outside of the U S. What atopic dermatitis as well that's about it throwing in rheumatoid arthritis franchise, we have the that's where that's preparing for hopefully an approval about <unk> outlook.

<unk> outside of the U S and other markets later on this year.

Moving on to Miri Keesema, yes, we recently had the readout of LUCEN2 just prior to the end of last year, and we met the primary endpoint and all the secondary endpoints, and we didn't only achieve statistical significance but also clinically meaningful differences when it comes to clinical, symptomatic, histologic, and endoscopic measures.

Moving on to communicate with them, Yes, we had recently read out of losing too just prior to the end of last year and we.

We met the primary endpoint and all of the secondary endpoints and we didn't only achieved statistical significance, but also clinically meaningful difference when it comes to clinical it seems domestic histologic and.

And we have also conducted the first study ever with an IL-23-P19 inhibitor where we have demonstrated reduced bowel urgency, which we know is a major concern today for both clinicians, but mainly for patients. So, therefore, we are looking forward to submitting myricase and myofascial ulcerative colitis during the first half of this year and, most likely, become the first IL-23-19 in this very important space and with a big unmet need and with a profile that we believe is very competitive versus both currently approved medicines and other biologics and drugs in development. Thanks Patrick and Kerry, thanks for your questions. Next caller, please. The next caller is Chris Shibutani from Goldman Sachs. Please go ahead.

In endoscopic mesh us and we have also conducted a thorough study ever with an IL 23, P 19, and where we have demonstrated reduced bowel urgency, which we know is a major concern today for both finished but made up of patients. So therefore, we're looking forward to submit Medicare smartphone ulcerative colitis in the first half of this year.

Most likely become the first IL 23, 19 MB, it's about important space and we have a big unmet need and we have a profile that we believe is fairly competitive let's just both currently approved medicines and other biologics and Jackson developments.

Thanks, Patrick Kerry Thanks for your questions next caller please.

The next caller is Chris about Goldman Sachs. Please go ahead.

Thank you very much. A question about the timeline plans for filing for DMAB. It's been an arena of influence from different party agencies, CMS, where it appears as if there is sort of instruction that has breadth of scope across multiple different types of a bit of. Would you say that since we know that competitor data is upcoming for additional approaches later this year, does that impact your view on your approach and timing for filing a DMAV? And then a second question would be on transeptide, the anticipated transition in type 2 diabetes Cruelty has been very strong.

Thank you very much a question about in timeline plans for filing for <unk>.

It's been an arena.

Hum.

Influence from different parties agency CMS, where it appears as if there is a sort of instruction that has breadth of scope across multiple different.

Any beta antibody. So would you say that since we know that competitor data is upcoming for additional approaches later this year does that impact your view on your approach and timing for filing a demerger and then a second question would be on turns appetite the anticipated transition in type two diabetes.

But can you perhaps give us a better sense about how you expect that transition to play out? I think broadly there's confidence in the profile and that cruzepatide will eventually succeed in continuing the franchise position in type 2 diabetes. But would you expect for the initial cruzepatide launch that to come primarily and importantly from the incident population? To be patient, a little insight into how that actual transition could play out in your view would be helpful. Thank you.

Cruise Citi has been very strong, but can you, perhaps give us a better sense about how you expect that transition to play out I think broadly there's confidence in the profile that current appetite eventually will succeed and continuing.

<unk> position in type two diabetes, but would you expect for the initial <unk> appetite launched that to come primarily and importantly from the incident population.

Would they be patients switching a little insight into how that actual transition could play out in your view would be helpful. Thank you.

Thanks Chris. We'll go to Dan for the question around the Nanomab filing timelines and then Mike for the transition with the TrueList for the InterZepetai franchises.

Thanks, Chris we'll go to Dan for the question around the <unk> filing timelines and then Mike for the transition with <unk> appetite franchises.

You raise a good point, with competitor readouts for amyloid-lowering drugs coming this year. We have to take into account expectations for those readouts. I think from our perspective, those readouts could be challenging. Obviously, we designed Denetimab as a molecule, our dosing strategy, and our clinical trial strategy, including who we enrolled and what endpoints we look at, in order to maximize the ability to see a positive signal. Other trials haven't done that yet.

Thanks, Chris you raise a good point with competitor Readouts for amyloid lowering drugs coming yet this year, we have to take into account expectations for those readouts I think from our perspective.

Those readouts could be challenging.

So, therefore, it's obvious that we would think that those trials should have a lower probability of success. I think if those trials are not successful, competitor readouts fail either because CDR, some of the boxes, is just too noisy an endpoint, and that can go both ways. It could help or it could hurt. We saw that in the two ajungenumab readouts, or because they have too many patients who are outside the optimal window of tau pathology because they're not doing that, or because they lower plaques too slowly. If any of those turn out to be correct and those trials turn out to be negative, I think that could further solidify CMS's reluctance to reimburse these drugs under accelerated approval. It doesn't really fundamentally change our thinking, though.

Obviously, we designed <unk> as a molecule our dosing strategy, our clinical trial strategy, including who we enrolled and what endpoints we look at.

In order to maximize the ability to see a positive signal other.

Other trials haven't done that so.

So therefore, it's obvious that we would think.

That those trials should have lower probability of success.

Think if.

Those trials are not successful competitor readouts fail, either because CD or some of the boxes is just too noisy and endpoint and that came with ways that could help her could hurt we saw that in in the two out of kitimat, readouts or because they have too many patients who are outside the optimal window of tau pathology, because they're not doing that.

Or because they lower Pax too slowly.

If any of those turn out to be correct in those trials turn out to be negative I think that could further solidify cms's reluctance to reimburse these drugs under accelerated approval. It doesn't really fundamental sea change our thinking though as I said before the key event for us as readout of our phase III study.

As I said before, the key event for us is the readout of our phase three study. I think we've optimized everything for our chances of success, and regardless of competitor readouts, if we have a positive phase three readout on top of our already first positive randomized controlled trial in Trell Laser 1, that is a very good position for Denenumab, and our expectation is that it will become globally available to patients and highly used by patients. Thanks Dan. Mike?

I think we've optimized everything for our chances of success and.

Lists of competitor Readouts, if we have a positive phase three readout on top of our already first positive randomized controlled trial and trailblazer one.

That is a very good position for genetic mab and our expectation is that's a drug that will become a globally available to patients and highly used by patients.

Thanks, Dan Mike.

Yeah, thanks for the question on Felicity and for Zephytide. You know, we're blessed to have both products. We're going to be taking, again, you know, from a long-term perspective on thropatite and obesity. Our goal is to continue to grow the market in type 2 diabetes and then really expand the interstitial class into the obesity market within type 2 diabetes. You know, our goal is not only to expand the market but to continue to expand our share of the market within the...

Yes. Thanks for the question on publicity in terms appetite.

We're blessed to have both products.

We're gonna be taken again from a long term perspective sponsors appetite and you will see our goal is to continue to grow the market and type two diabetes and then really expand.

In class into the obesity market.

Within type two diabetes.

Sure.

Our goal not only as a expand the market, but continue to expand our share of market within the Atlanta market.

When you look at the way we promote our products, we take a very patient-centric approach to identifying those patients who could best benefit from a product like... In our market research, as we put the profile of Drusopotite up against assisting therapies, including Trlicity, both payers and health care professionals and people who live with diabetes see the superior profile of trisepatide when you compare that to trilicity. There are phase three trials that show greater weight loss, better A1C control, and it's in the exact same device as Trlicity.

When you look at the way, we promote our products, we take a very patient centric approach to identifying those patients who can benefit.

From a product like for example, the time in our market research as we put the profile of throughs appetite up against the 16th therapies, including <unk>.

Both payers and health.

Health care professionals and people, who live with diabetes.

The superior profile.

At the time, when you compare that solicited.

Our phase III trials that showed greater weight loss.

So there is obviously interest in the product, and they do see it as a superior product from Trlicity. Now, you know, what I believe will happen is that, you know, we will grow our overall share and you'll get a portion of patients who may have gone on felicity or may be on felicity and may be out of control who need, you know, greater weight loss or greater. A1C control, and those patients will grow on trajeptide.

Better once you control and it's in a sexy devices traverse city. So there is obviously interest.

In the product and they do see it as a superior product from solicited.

Now what I believe will happen is that we will we will grow our overall share.

And.

You'll get a portion of patients who may have.

Gone on Felicity or may be on Felicity and maybe out of control.

Who needs greater weight loss or greater.

You won't see control and those patients will go on for <unk>. So we do anticipate that there'll be some conversion from felicity over futures appetite, but our focus is really going to be making sure that we will grow the overall class and growth of overall share of market for the Lilly.

So we do anticipate that there'll be some conversion from Felicity over to trajeptide, but our focus is really going to be making sure that we grow the overall class and grow the overall share of the market for Lilly. American, French, you know, we don't think it's appropriate to necessarily promote the conversion of products who are doing well on Felicity so it's not going to be a kind of internally focused conversion strategy. It's going to be very much like that. Patients are out of control or need additional weight loss. Proseptide can offer that.

Franchise.

We don't think it's appropriate that necessarily promote.

And conversion of products, who are doing well on felicity. So it's not going to be a kind of internally focused conversion strategy is going to be very much a patient focus product for those patients who are out of control or need additional weight loss, there's appetite and offer that so we're quite excited.

So we're quite excited about the opportunity to have two Minkertons in our portfolio and grow the overall class. Thanks, Mike. Chris, thanks for your questions. Next caller, please. The next caller is Evan Seigerman from BMO. Please go ahead when your line is open. All right, well, if Kevin's not there, the queue is exhausted, and we'll go to Dave for the close. Okay, thank you, Kevin.

And about the opportunity to have to.

Two anchor tenants in our portfolio and grow the overall class. Thank you for the question.

Thanks, Mike Chris Thanks for your questions next caller please.

The next caller is Evans senior men from BMO. Please go ahead.

Yeah.

Evan.

Yeah.

Kevin Your line is open.

The next question.

Okay.

Alright, well.

<unk> is not there we are accused exhausted, we'll go to Dave for the close.

Thank you Kevin.

We appreciate everyone's participation in today's earnings call. And, of course, you're interested in our company. 2021 was an incredible year for the company, as we produced strong financial results and delivered important pipeline progress in each of our core therapeutic areas on behalf of the patients who rely on us. We entered 2022 with positive momentum and a great focus on execution to deliver on the meaningful opportunities we have ahead of us. So thanks for dialing in today, and please follow up with our IR team if you have questions we have not addressed on the call. Have a good one.

Appreciate everyones participation in todays earnings call and of course Youre interested your interest in our company.

'twenty one was an incredible year for the company as we produced strong financial results and delivered important pipeline progress in each of our core therapeutic areas on behalf of the patients who rely on us.

We entered 2022 with positive momentum and great focus on execution to deliver on the meaningful opportunities. We have ahead of us. So thanks for dialing in today and please follow up with our IR team. If you have questions. We have not addressed on the call have a good one take care.

Okay.