Q4 2021 Novartis AG Earnings Call

Operator: Good morning and good afternoon and welcome to the Novartis Q4 and four-year 2021 results released conference call and live webcast. Please note that during the presentation all participants will be in a listen only mode and the conference is being recorded.

Good morning, and good afternoon, and welcome to the Novartis Q4, and full year 2021 results release conference call and live webcast. Please note that during the presentation. All participants will be in a listen only mode and the conference is being recorded after the presentation there'll be an opportunity to ask question.

By pressing star one at any time, joining the conference a recording of the conference call, including the Q&A session will be available on our website. Shortly after the call ends should anyone need assistance during the conference call. They may signal. The operates up by pressing star zero with that I would like to handover to Mr. Samir Shah Global head.

Operator: After the presentation there will be an opportunity to ask questions by pressing star and one at any time during the conference. A recording of the conference call including the Q&A session will be available on our website shortly after the call ends. Should anyone need assistance during the conference call they may signal the operator by pressing star and zero. With that I would like to hand over to Mr. Samir Shah, Global Head of Investor Relations. Please go ahead sir.

Investor Relations. Please go ahead Sir.

Samir Shah: Thank you very much and good morning and good afternoon everybody. A big thank you for joining us today on our Q421 and full year 21 results. The information presented today contains forward looking statements that involve known and unknown risks, uncertainties and other factors. These may cause actual results to be materially different from any future results, performance or achievements expressed or implied by such statements.

Thank you very much and good morning, and good afternoon everybody. Thank.

Thank you for joining us today on our Q4 'twenty one.

Full year 'twenty one results. The information presented today contains forward looking statements that involve known and unknown risks.

Please.

Taxes. These may cause actual was supposed to be materially different from any future results performance or achievements expressed or implied by such statements.

Samir Shah: For a description of some of these factors, please refer to the company's Form 20-F and its most recently quarterly results on Form 6-K that respectively were filed with and furnished to the U.S. Securities and Exchange Commission. With that, I now hand it across to Voss. Thank you, Samir, and thank you everyone for joining today's conference call. I'm moving to slide three with me today. I have Harry Murray from the audience. Susanna, John, Richard, Karen, and of course you've already heard from Samir.

Correct description of some of these factors please refer to the company's form 20-F.

Recently quarterly results on form 6K that respectively were filed with and furnished to the securities.

Securities and Exchange Commission.

With that kind of close to five.

Yeah.

Thank you Samir and thank you everyone for joining today's conference call moving to slide three with me today I have Harry very broad Susanna.

Susanna John Richard Carrion and of course, you've already heard from Samir now turning to slide five and before moving into the quarter I'd like to just make a few overarching statements about the company our direction and our overall profile.

Vasant Narasimhan: Now turning to slide five, and before moving into the quarter, I'd like to just make a few overarching statements about the company, our direction, and our overall profile. We believe we continue to present an attractive profile for investors, a clear strategy as a focused medicines company powered by technology and technology platforms, which we believe will define the future of our sector as a future of medicine. An attractive growth profile where we're confident in the 4% plus sales CAGR that we've guided to, and with the goal to be above pure median beyond 2026, and an aspiration to be in the high 30s IM margin, which we're well on our way towards, a strong mid and late stage portfolio with over 20 assets with significant peak sales potential, platform leadership, which we continue to work towards across multiple defining platforms in the sector, and a balanced approach to capital allocation, which I'll speak more about in a few slides. Now moving to slide six.

Believe we continue to present, an attractive profile for investors a clearer strategy as a focused medicines company powered by technology and technology platforms, which we believe will define the future of our sector as the future of medicine.

An attractive growth profile, where we're confident in the 4% plus sales CAGR that we've guided to.

The goal to be above peer median beyond 2026, and an aspiration to be in the high Thirty's I am margin, which we're well on our way towards a strong mid and late stage portfolio with over 20 assets with significant peak sales potential.

That formed leadership, which we continue to work towards across multiple defining platforms in the sector.

Our balanced approach to capital allocation, which I'll speak more about in a few slides.

Now moving to slide six.

Vasant Narasimhan: We continue to evolve and sharpen our strategy. We are continuing to look at where to play, with a particular focus now on four key therapeutic areas, with two additional therapeutic areas we are selectively participating in. Focus on four key geographies, while always evaluating our geographic footprint. An aspiration to transform Sandoz.

We continue to evolve and sharpen our strategy.

We are continuing to look at where to play with a particular focus now on four key therapeutic areas with two additional therapeutic areas. We're selectively participating in focus on four key geographies, while always evaluating our geographic footprint and aspiration to transform Sandoz five key <unk>.

Vasant Narasimhan: Five key priorities on how we win, which we continue to focus on and believe will enable us to outperform the sector over time. And a clear aspiration to be a top three innovator, be in the high 30s in terms of our IM margin, attractive return on invested capital, and continuing to be one of the leaders in material ESG factors in the biopharmaceutical sector. Then moving to slide seven, when you look at our track record on our financial performance, our track record, particularly on IM, has been solid. IM sales in the last four years have grown 7 percent. IM core operating income has grown 13 percent, which is amongst the highest in the sector.

Priority is on how we win which we continue to focus on and believe will enable us to outperform the sector over time and clear aspiration to be a top three innovate or be in the high <unk> in terms of our margin attractive return on invested capital.

<unk> could be one of the leaders in material ESG factors in the biopharmaceutical sector.

Now moving to slide seven when you look at our track record on our financial performance our track record, particularly in I am has been solid <unk> sales in the last four years have grown 7% I am core operating income has grown 13%, which is amongst the highest in the sector are I am core margin.

Vasant Narasimhan: Our IM core margin has now reached 36.2, and our group free cash flow continues to perform well, and we continue to look at improving our free cash flow generation as a firm. So I think this demonstrates that we are delivering against the goals we set ourselves, and we plan to continue to do that in the years to come. Then moving to slide eight, just as a reminder, over the coming years, we expect to grow at that 4% or better rate, overcoming the estimated $9 billion of potential generic impact that we could have in this period, with a series of strong growth drivers, six major assets, which we believe will have multi-billion dollar potential, a strong pipeline, which would then be added on top, leading to that 4%. And of course, depending on when the interest of LOE falls, the potential to do even better.

Has now reached $36 two group free cash flow continues to perform well and we continue to look at improving our free cash flow generation as a firm. So I think this demonstrates that we are we are delivering against the goals, we set ourselves and we plan to continue to do that in the years to come.

Moving to slide eight just as a reminder, over the coming years, we expect to grow that at that 4% or better rate overcoming the estimated $9 billion of potential generic impacts that we could have in this period with a series of strong growth drivers six major assets, which we believe will.

Have have multibillion dollar potential a strong pipeline, which would then be added on top leading to that 4% and of course, depending on when the entrust low ball has the potential to do even better.

Vasant Narasimhan: So now turning to Q4, and to slide 9. In Q4, we delivered strong performance across our value drivers. Growth was plus 6% in the quarter, with IM reaching 7% of sales productivity, and continued with Group Core operating up 12%, and IM Core operating income up 15%, I think demonstrating that productivity power we have within the company. I'll come back to innovation, but we had important innovation milestones in the quarter. And in terms of our progress on ESG, we have improved scores on multiple ESG metrics, including the MSCI, and continued our progress on the environment and human rights.

So now turning to Q4 and on slide nine.

In Q4, we delivered strong performance across our value drivers growth was plus 6% in the quarter with I am reaching 7% of sales productivity continued with group core operating up 12% I am core operating income up 15% I think demonstrating that.

That productivity power, we have within the company.

Come back to innovation, but we had important innovation milestones in the quarter and in terms of our progress on ESG, we had improved scores on multiple ESG metrics, including the MSCI and continued our progress on environment and human rights.

Vasant Narasimhan: So focusing in on growth and turning to slide 10. Our key growth drivers grew 24% in the quarter and now represent more than half of the IM sales. We were pleased with the performance on our growth brands and Mary France and Susanna will go through that in a bit more detail. And as you can see on the right hand side of the slide, the steady increase we've had these growth drivers constituting more and more of our sales, demonstrating the replacement power of our core sales space that we have within the company. They're moving to slide 11.

So focusing in on growth and turning to slide 10.

Our key growth drivers grew 24% in the quarter and now represent more than half of that I am sales. We were pleased with the performance on our growth brands and Marie France is that I'll go through that in a bit more detail and as you can see on the right hand side of the slide the steady increase we've had.

These growth drivers concentrating more and more of our sales demonstrating the replacement power of our core sales space that we have within the company.

Now moving to slide 11.

Vasant Narasimhan: Across the six key brands of hyper-focused on, we saw double-digit growth, scostentics growing 17% and trustee at 40% until gender, 46% and Kiskali at 36%. Kisimta is off to a very strong start on its first full launch, here in America, and we'll go through that in a bit more detail, but we saw very strong share gains. And Lexio is in a billbeer this year, and we expect over the course of this year to constantly build momentum towards an inflection point in the 23 and beyond time period.

Across the six key brands.

We're focused on we saw double digit growth <unk> growing 17% and trust so at 40% until Jones about 46% and Kiss Golly at 36% is off to a very strong start on its first full launch here Marie France will go through that in a bit more detail, but we saw very strong share gains and LIFO.

In a build year this year and we expect over the course of this year to consistently build momentum towards an inflection point in the 'twenty three and beyond time period as you can see and as we highlighted in our R&D day. These brands are protected outside of interests into the late 2000 twenty's or into the 2030.

Vasant Narasimhan: As you can see, and as we highlighted in our R&D day, these brands are protected outside of interest, though, into the late 2020s or into the 2030s, forming a strong foundation for the company which we can build on with our pipeline assets. Then moving to slide 12, and when you take a geographic view of the business, we had consistent growth across the U.S., Europe, and China in innovative medicines, driven by different brands in each case.

Forming a strong foundation for the company, which we can build on with our pipeline assets.

Now moving to slide 12, and when you take a geographic view of the business, we had consistent growth across U S. Europe and China in innovative medicines is driven by different brands in each case, but in the U S. We continue to show consistent growth and we have an aspiration to become a top five player in the U S over time.

Vasant Narasimhan: But in the U.S., we continue to show consistent growth, and we have an aspiration to become a top-five player in the U.S. over time. In Europe, we remain the largest pharmaceutical company, and again are looking forward now to launching Cosimta and Lectio in the market to continue that growth dynamic. In China, we have been one of the most consistent-growing companies in the high teens over recent years, and we are confident that we will get to our goal of over $4 billion in sales in China by 2025.

In Europe , we remain the largest pharmaceuticals company and again, our looking forward now to launching <unk> and <unk> in the market to continue that growth dynamic in China. We have been one of the most consistent growing companies in the high teens over recent years.

And we are confident that we will get to our goal of over $4 billion in sales in China by 2025.

Vasant Narasimhan: And we'll go through a little bit more on some of the dynamics in China in quarter four, but we've already seen a recovery from some of the slowdown we saw in Q4 due to the buying patterns, the NRDL listings, and some of the other considerations that we have, and we'll speak more about that in the conference call. Now, moving to slide 13 and turning to innovation, we had multiple milestones in the quarter, the approvals of Semblix in the U.S. and Lectio in the U.S., importantly, from an approval standpoint. Additional submissions, including Lu PSMA 617 in Europe, as well as Alpalisib in PROSE, an opportunity for us to take on a very high-unmet need, though small indication.

And we'll go through a little bit more on some of the dynamics in China in quarter, four but we've already seen a recovery from some of the slowdown we saw in Q4 due to the buying pattern.

And our deal with things and some of the other considerations that we have and we will speak more about that in the conference call.

Now moving to slide 13, and turning to innovation, we had multiple milestones in the quarter. The approvals of assembly in the U S and <unk> in the U S. Importantly from an approval standpoint, additional submissions, including Lou PSM Asics, one seven in Europe .

As well as our policy.

Pros.

Opportunity for us to take on a very high unmet need those small indications are readouts multiple readouts in the quarter positive data for Concentrix and hidradenitis secret Cvs as well as with IV administration in Psoriatic arthritis, legalism read out as well positive versus.

Vasant Narasimhan: Our readouts, multiple readouts in the quarter, positive data for Cofensex and hydradonitis, as well as with IV administration and psoriatic arthritis. Ligalizumab read out as well, positive versus placebo, non-inferior versus Zolair, and we continue to evaluate the path forward for Ligalizumab, and YTB and PHE, which I'll speak more about as well in terms of our novel CAR-T platform. We began our phase 3 studies for remibrutinib, both in multiple sclerosis and CSU, as well as with Ligalizumab in food allergy and cold-induced urticaria. The moving to the next slide on slide 14.

Bo.

Non inferior versus Xolair, and we continue to evaluate the path forward for legal reasons.

And <unk>, which I'll speak more about as well in terms of our novel car T platform. We began our phase III studies for Remy Route nib, both in multiple sclerosis, and PSU as well as with legalism Mab in food allergy and cold induced or to carry out.

Vasant Narasimhan: Just a few words on some of the data readouts. Ironilamab is, after we're very excited about, this is our anti-bath receptor, monoclonal antibody, had very strong data in children's syndrome in a phase 2B study. We'll be moving into children phase 3 later this year. We all planning as well, shortly to initiate studies in phase 3 for Lupus and Afritis. We're advancing in S.L. E. as well as an autoimmune hepatitis and expect additional data over the coming 12 months on these two indications.

Now moving to the next slide on Slide 14.

Just a few words on some of the data readout I Mab is active we're very excited about this is our anti <unk> receptor monoclonal antibody had very strong data in shogun syndrome in a phase <unk> study will be moving into sugar in our phase III later this year.

Planning is well shortly to initiate studies in phase III for lupus nephritis, we're advancing in <unk> as well as an autoimmune hepatitis and expect additional data over the coming 12 months on these two indications and we're also looking to progress within B cell malignancies, where we believe an anti VEGF receptor.

Vasant Narasimhan: We're also looking to progress within diesel malignancies where we believe an anti-bath receptor antibody could provide an additional option for these patients taking together. We think this asset has the potential to be the quote-unquote pipeline in a single asset, and we look forward to advancing in across a broad range of indications. I already mentioned the Cotentic data in HF, which is a high unmet need area hydronized and added supernova is a severe debilitating condition, a good efficacy profile, a strong safety profile.

Antibody could provide an additional option for these patients taken together, we think this asset has the potential to be the quote unquote pipeline in the single asset when we look forward to advancing across a broad range of indications I already mentioned.

<unk> data in Asia. This is a high unmet need area of hydro.

Vasant Narasimhan: We are keeping the study blinded until the 52-week time point, and following that 52-week safety data, we will then be able to move forward with submissions in the US. Submissions in the EU are already under preparation, and we would expect them in the first half. And as I mentioned with legalism app data demonstrated superiority versus placebo, but not superiority versus Zolaire, and we'll provide a further update on this asset in terms of its progress in QSU shortly. However, we do believe there's potential for the medicine in food allergy and tendu, given there is no approved anti-IG therapy. Then moving to slide 15.

Super severe.

Illustrating condition.

<unk> efficacy profile a strong safety profile, we are keeping the study blinded until the 52 week time point and following that 52 week safety data. We will then be able to move forward with submissions in the U S. Submissions in the EU are already under preparation and we would expect them in the first half and as I.

With legalism Mab data demonstrated superiority versus placebo, but not superiority versus xolair and we'll provide a further update on the asset in terms of its progress and PSU. Shortly however, we do believe there is potential for the medicine in food allergy and can do given there is no approved anti <unk>.

<unk> therapy IV therapy.

<unk>.

Now moving to slide 15.

Vasant Narasimhan: Just to say a word about the data we recently presented in December on our T-Charge platform, our next generation CAR-T platform, which we're excited about given the potential to provide draft access to therapy, hopefully improved rates of response and longer durability, as well as attractive economics in terms of its production and scalability. YTB, which is indicated for DLBCL in a small study of 16 patients. We're looking forward to reading out the six months data over the coming months, and we plan to start a phase three trial in DLBCL this summer for this asset, and PhD in multiple myelomas of BCMA, directed CAR-T, again, early data, but in the first six patients 100% ORR.

Just to say a word about the data. We recently presented in December on our T charge platform. Our next generation car T platform, which we're excited about given the potential to provide fast access to therapy, hopefully improved rates of response and longer durability as well as attractive economic.

Mix in terms of its production and scalability.

TB, which is indicated for deal Bcl.

Small study of 16 patients demonstrated a 73% CR rate at month, three and we're looking forward now to reading out the six month data over the coming months and we plan to start a phase III trial in <unk>. This summer for this asset and phe in multiple myeloma is a <unk> directed car T.

Again early data, but in the first six patients are 100% <unk>. What's unique about this technology platform is its ability to preserve what's termed a T cell stemmed the ability of T cells to regenerate themselves. So hopefully lead to more long and durable responses, it's a cancer recurrence.

Vasant Narasimhan: What's unique about this technology platform is its ability to preserve what's termed as key self-schemness, the ability of key cells to regenerate themselves, to hopefully lead to more long and durable responses, if I guess recurrence should occur, also enables a short and time frame for cells to be out of the patient's body. So many things to be excited about early days, but we look forward to taking this forward, and hopefully over time bringing additional targets onto the T-Charge platform.

Occur also enables I was shortened timeframe for cells to be out of the patient's body. So many things to be excited about early days, but we look forward to taking this forward and hopefully over time, bringing additional targets onto the T charge platform.

Vasant Narasimhan: Then moving to slide 16, in the quarter as well, we signed four additional BDML deals to strengthen the pipeline. We acquired Gyroscope, which has a one-time subretinal phase two gene therapy that has the potential to transform the care of geographic atrophy.

Now moving to slide 16 in the quarter as well, we signed four additional BD enel deals to strengthen the pipeline, we acquired gyroscope, which has a one time sub retinal phase III gene therapy that has the potential to transform the care of geographic atrophy in early data.

Vasant Narasimhan: In early data in nine patients, rather remarkable results that we saw for this one-time administration. We'll now have to see how those results hold up in larger phase two studies, but at least the potential to address a very large market and a very large patient unmet need with a one-time therapy. We signed an option agreement with Beijing for oseprolamab, the phase three tiget inhibitor, currently being run by Beijing in global phase three studies in solid tumors, particularly in lung cancer, EFCC and cervical cancer.

And nine patients rather remarkable results that we saw for this onetime administration will now have to see how those results hold up a larger phase II studies, but at least the potential to address a very large market and a very large patient unmet need with a onetime therapy, we signed an option agreement with <unk>.

<unk> the phase III <unk> inhibitor currently being run by <unk> and global Phase III studies in solid tumors, particularly in lung cancer.

D C cervical cancer.

Vasant Narasimhan: We are looking forward to working with Beijing to fully build out this program over the course of the year. And then as data continues to materialize, determine if a full option would be warranted. We signed our opt-in agreement with Molecular Partners for Enzobibep, which has the potential to be a broad spectrum coronavirus therapeutic for patients in the outpatient setting, has three targets to fight protein in three separate finding domains, opportunity for bacterial production, so much higher yields and much more efficient production, also higher scales.

We are looking forward to working with Beijing to fully build out this program over the course of the year and then as data continues to materialize determined full opt in would be warranted.

We signed our Optum agreement with molecular partners for and there'll be about which has the potential to be a broad spectrum.

Corona virus therapeutic for patients in the outpatient setting.

It has three targets as the bike protein in three separate binding domain opportunity for bacterial production, so much higher yields and much more efficient production also higher scales. We are on track and our discussions with the FDA to complete an emergency use authorization filing and then it would be determined.

Vasant Narasimhan: We are on track in our discussions with the FDA to complete an emergency use authorization filing, and then it would be determined by a review matter if the FDA would ultimately provide an approval. We also continue to be in discussions with the U.S. government as well as other governments around the world regarding this therapeutic, as well as advancing the phase three trials and subcutaneous formulation. And then lastly, we signed an agreement with UCB for the co-development and co-commercialization of an alpha-synuclein small molecule inhibitor, an opportunity to tackle Parkinson's disease with a small molecule agent against, I think, a very exciting target.

Bye.

A review matter if the FDA would ultimately provide an approval. We also continue to be in discussions with the U S government as well as other governments around the world with targeted therapeutics as well as advancing the phase III trials and subcutaneous formulations and then lastly, we signed an agreement with UCB for the co development and co commercialization of analysis.

The nuclear <unk> small molecule inhibitor.

Opportunity to tackle Parkinson's disease with a small molecule agent against I think a very exciting target early data early days, but certainly the potential to address a major unmet need.

Vasant Narasimhan: Early data, early days, but certainly the potential to address a major unmet need. Now, turning to slide 17, slide 17 and the following slide as well, give you an overview, one kind of a snapshot of our portfolio in pharmaceuticals and cardio-renal. Things are on track, and you can see some additional progress we've made on the Alexio outcome studies, and the tacropan and telecarcin also remain on track. In neuroscience, as Zoltan said, we've initiated the phase 3 intrathecal study now. Branaplam has also now initiated its phase 2B study in Huntington's disease.

Now turning to slide 17, slide 17 in the following slide as well give you an overview one kind of a snapshot of our portfolio in pharmaceuticals, and cardio renal things are on track and you can see some additional progress we've made on the Latvia outcome studies and the type of patents Hello Carson also remain on track.

In neuroscience as the old Gen, but we've initiated the phase III interest equal study now Brian a plan that has also now initiated in this phase <unk> study in Huntington's disease I already mentioned revenue grew and our agent in Parkinson's disease and across the immunology portfolio, a number of ongoing projects and programs with <unk>.

Two in phase III, all largely on track at the bottom you see the status of our wildcard programs. Later this year, we would have readouts for <unk> and <unk> and we continue to also progressed the other agents.

And that box as well.

Vasant Narasimhan: I already mentioned remigrutinib and our agent in Parkinson's disease. And across the immunology portfolio, a number of ongoing projects and programs in phase 2 and phase 3 are largely on track. At the bottom, you see the status of our wildcard programs. Later this year, we would have readouts for QBW and UNR, and we continue to also progress the other agents in that box as well. Now, turning to slide 18.

Turning to slide 18.

Vasant Narasimhan: In oncology, we also are progressing on track in solid tumors and hematology. The Kisgali-Natalie readout is on track for an event-driven readout, but we continue to expect it by the end of 2022, if the event rate changes and it flips into 23, we'll of course let the markets know. The Canopy A study also is on track for a readout in the second half of this year. Leu PSMA, importantly, the additional readout for our PSMA-4 study, again, an event-driven study, but we're hopeful to have a readout on that in the earlier lines of prostate cancer by the end of 2022.

In oncology, we also are progressing on track and solid tumors and hematology because golly Natalie readout is on track for its an event driven readout.

<unk> expected by the end of 2022, if the event rate changes it.

It flips into 'twenty three we will of course, let the markets know that cannot be a study also is on track for a readout in the second half of this year Loopy SMA importantly, the additional read out for RFP SMA for study again, an event driven study, but we are hopeful to have a readout on that in the earlier lines of prostate cancer by the end of 2020.

Vasant Narasimhan: And the review of Leu PSMA with the FDA is on track, given its action date later this quarter. And we also progress JDQ, TNO. We look forward to presenting additional data on the combination, we hope, over the coming 12 months. In hematology, the Asiminib first-line approval, third-line approval, we've already achieved, and Susanna will speak more about that. And then I've already mentioned some of the other agents here.

And the review of Loopy SMA with the FDA is on track.

Its action date.

Later this quarter and.

And we also progressed at EQT, we look forward to presenting additional data on the combination we hope over the coming 12 months.

In hematology the assimilated first line approval third line approval, we've already achieved and then I'll speak more about that.

And then I've already mentioned some of the other agents here at <unk>, our anti Tim three on track for our PFS readout in the first half of this year and the various other studies moving towards PFS and OS will come over the coming coming year as well so a lot going on and we expect additional readouts, particularly in the back half of this year and heading into 2012.

Vasant Narasimhan: Thabetolimab, our anti-TYM3, on track for a PFS readout in the first half of this year, and the various other studies moving towards PFS and OS will come over the coming year as well. So a lot going on. We expect additional readouts, particularly in the back half of this year and heading into 2023. When you look at slide 19.

Three when you look at slide 19.

Vasant Narasimhan: You can see the full list of expected events, regulatory decisions, submissions, submission enabling readouts, additional readouts, and you can also see a large number of pivotal study starts. These studies will be important for us to continue to advance the 20 plus assets that we've been talking about that will drive growth 2025 and beyond. We're moving to slide 20. Just to say also a word on Sandoz. We saw Sandoz stabilizing in quarter four.

You can see the full list.

<unk> expected events regulatory.

Decisions submissions submission, enabling readouts additional readouts and you can also see a large number of pivotal study start. These studies will be important for us to continue to advance the 20 plus assets that we've been talking about that will drive growth 2025 and beyond.

So moving to slide 20.

Vasant Narasimhan: You saw sales grow plus 2% in the quarter, as well as biopharma growing 7% in constant currencies. When we think about the outlook for 2022, we forecast sales to be broadly in line, and Harry will talk a little bit more about the specifics on the guidance. We're assuming here that cough and cold reverts to pre-COVID levels, that biosimilars continues to perform, particularly in Europe, where we have a very strong market position.

Just to say also a word on sandoz with Sandoz stabilizing in quarter four you saw sales growth plus 2% in.

In the quarter as well as Biopharma growing 7% in constant currencies. When we think about the outlook for 2022, we forecast sales to be broadly in line and Harry I'll talk a little bit more about the specifics on the guidance, we're assuming here that cough and cold reverts to pre COVID-19 levels that Biosimilars continues to.

<unk>, particularly in Europe , where we have a very strong market position, but we also faced continued gross margin headwinds due to the price erosion and an unfavorable mix, particularly in the U S, which we expect to fully bottom out in this year and start to move towards a growth dynamic in the back half of next year, our Biosimilars launches however continued to.

Vasant Narasimhan: But we also face continued gross margin headwinds due to the price erosion and unfavorable mix, particularly in the US, which we expect to fully bottom out in this year and start to move towards a growth dynamic in the back half of next year.

Vasant Narasimhan: Our biosimilars launches, however, continue to be on track, and we're expecting these launches to drive material growth in the back half of 2023 into 2024 and beyond. There are $80 billion of originator sales, a large opportunity. We have 15 plus assets somewhere in development. So that will be absolutely critical to move Sandoz into a strong growth dynamic looking ahead.

On track and we are expecting these launches to drive material growth in the back half of 2023 into 2024 and beyond.

There are $80 billion of originator sales a large opportunity we have 15 plus asset somewhere in development, so that will be absolutely critical to move sand.

Into a strong growth dynamic looking ahead.

Vasant Narasimhan: Moving to slide 21, a word on our capital allocation strategy. We remain disciplined and shareholder focused and really trying to balance the four elements of our strategy. And this is a shift, we're not ranking them, but rather, really showing them as a balanced approach.

Moving to slide 21, a word on our capital allocation strategy, we remained disciplined and shareholder focused and really trying to balance the four elements of our of our strategy and this is a shift where not ranking them, but rather really showing them as a balanced approach we invest in our organic business you can see $9 billion in R&D over $1 billion in capital.

Investments. We also continue to look at value, creating bolt ons, we've done around $30 billion of acquisitions since 2018, and we also return value to shareholders through our annual dividend, where we propose this year to increase by 3% Swiss franc and 6% in U S dollars.

As announced in the quarter four we continue to also return.

Our our capital to shareholders, where appropriate and share buybacks of $2 8 billion were executed in 2021, and we're on track with respect to the $15 billion share buyback program that we announced in the back half of last year, which we expect given the nature of the Swift second line second trading line cancellations take us.

Until the end of 2023 to fully complete.

So moving to slide 22.

From an ESG standpoint, and we continue to make important progress in sub Saharan Africa with respect to our human rights commitments in terms of disability inclusion.

Our environmental targets are on track with 34% scope, one and two reductions excluding offsets waste disposal also reduced and on track to be at half by 2025, all on track towards our goal of being carbon neutral across scopes, one through three by 2030 and fully net zero by 2040.

Sooner as soon as possible.

It is our aspiration and this has all led to improved scores from an MSCI, we're no longer having an MSCI controversy red flag ranked number two in the access to Medicine index and also favorably ranked in the S&P global ESG ratings amongst other ratings.

We've had over the course of the year. So in closing on slide 23.

Just wanted to highlight the priorities for the company over the course of this year the successful launches of <unk>.

Loopy SMA, which we believe has the potential to be a very significant asset and assembly, where again, we have the opportunity to build on a third line approval and hopefully move into earlier lines of therapy maintained the growth momentum on our six multibillion dollar assets or the assets that we believe will drive the company's <unk>.

This level of growth over the coming years progressing the pipeline of 20 plus potential significant sales assets.

<unk> that'd be approved by 2026.

Optimize our portfolio with the Sandoz review with a plan to have this updated by the end of 2022 and remained disciplined and thoughtful on our BD and M&A to build the growth profile of the company, but also ensure attractive returns for our shareholders deliver those returns through our productivity initiatives, especially in manufacturing.

Business services as we move towards the high <unk> and our margins as well as an attractive return on invested capital profile and continue to reinforce the foundation of a great company a strong culture that drives performance leadership in data science to drive value across the business and being in ESG and Peter.

So thank you very much and with that I'll hand, it over to Tom.

Vasant Narasimhan: We invest in organic business, you can see $9 billion in R&D over a billion dollars in capital investment. We also continue to look at value creating bolt-ons. We've done around $30 billion of acquisitions since 2018. And we also return value to shareholders through our annual dividend, where we propose this year to increase by 3% since ranked 6% in US dollars. And as announced in the quarter four, we continue to also return our capital to shareholders where appropriate, share buybacks of $2.8 billion were executed in 2021.

Good morning, good afternoon to all on.

Vasant Narasimhan: And we're on track with respect to the $15 billion share buyback program that we announced in the back half of last year, which we expect, given the nature of the Swiss trading line cancellation, to take us until the end of 2023 to fully complete. So moving to slide 22.

Vasant Narasimhan: From an ESG standpoint, we continue to make important progress in sub-Saharan Africa with respect to our human rights commitment in terms of disability inclusion. Our environmental targets are on track with 34% scope one and two reductions excluding off that waste disposal, also reduced and on track to be at half by 2025. All on track towards our goal of being carbon neutral across scopes one through three. If by 2030 and fully met zero by 24.

Vasant Narasimhan: 40 and sooner as soon as possible is our aspiration. And this is all that to improve scores from an MSEI. We are no longer having an MSEI controversy red flag rank number two in the access to medicine index and also favorably ranked in the S&P global ESG rating amongst other ratings that we've had over the course of the year. So, I'm closing on 523.

Slide 25, I am pleased to share our quarter four results kind of the pharma division with you.

Sales grew 9% this quarter as you know we are fully focused on our growth drivers and launches and the rejuvenation of our portfolio you can expect us to continue to drive this shift in 2022 and beyond.

Vasant Narasimhan: I just wanted to highlight the priorities for the company over the course of this year. The successful launches of Lectio, Cosimta, Loopy SMA, which we believe has the potential to be a very significant asset, Ensemblix, where again, we have the opportunity to build on a third line approval and hopefully move into earlier lines of therapy. Maintain the growth momentum on our six multibillion dollar assets that are the assets that we believe will drive the company's base level of growth over the coming years.

Vasant Narasimhan: Progressing the pipeline of 20 plus potential significant sales assets with the opportunity that be approved by 2026. Optimize our portfolio with the Sandoz review with a plan to have this updated by the end of 2022 and remain disciplined and thoughtful on our BD and M&A to build the growth profile of the company, but also ensure attractive returns for our shareholders. Deliver those returns to our productivity initiatives, but especially in manufacturing and business services as we move towards the high 30s in our margins, as well as an attractive return on invested capital profile and continue to reinforce the foundations of a great company, a strong culture that drives performance, leadership, and data science to drive value across the business and being an ESG leader. So, thank you very much. And with that, I'll hand it over to.

Marie-France Tschudin: So good morning, good afternoon to all. On slide 25, I'm pleased to share the quarter four results of the pharma division with you. Our sales grew 9% this quarter. As you know, we're fully focused on our growth drivers and launches and the rejuvenation of our portfolio. You can expect us to continue to drive this shift in 2022 and beyond. So moving on to slide 26. Cosentix delivered $1.2 billion in revenues and grew 13% in the quarter.

Moving on to slide 26.

Im just delivered one 2 billion in revenues and grew 13% in the quarter.

We've seen strong demand for <unk> text across geographies, we did see some impact in China due to the year end budget caps. However, we've already seen a strong rebound in Q1.

Our lifecycle program is starting to deliver with a positive readout hydride tinnitus severity that IV and we will start to be a growth driver in 2023.

Marie-France Tschudin: We've seen strong demand for Cosentix across geographies. We did see some impact in China due to the year-end budget caps. However, we've already seen a strong rebound in Q1. Our lifecycle program is starting to deliver with the positive readout for hydroiodonitis superativa and IV, and will start to be a growth driver in 2023. If we look to 2022, our focus is on volume growth in all geographies, especially China.

If we look to 2022, our focus is on volume growth in all geographies, especially China.

Marie-France Tschudin: In the US, our access position is stable and we plan to grow with the market. As we will not benefit from the price favorability we saw last year, volume growth for us is key. You can expect to see the typical quarter over quarter decline in Q1, followed by continued double digit growth for the full year, fully on track to deliver on our $7 billion plus guidance. If I move on to slide 27, interest grew 34% in the quarter, finishing the year at $3.5 billion in sales.

And the U S. Our access position is stable and we plan to grow with the market.

We will not benefit from the price favorability, we saw last year volume growth for us is key.

You can expect to see the typical quarter over quarter decline in Q1, followed by continued double digit growth for the full year fully on track to deliver on our 7 billion cost guidance.

If I move on to slide 27.

<unk> grew 34% in the quarter, finishing the year at $3 5 billion in sales.

Marie-France Tschudin: We continue to pull through the first-line recommendations in the U.S. and Europe, and we continue to have good traction with the expanded label in the U.S. which, as you know, includes five out of six patients with heart failure. In China, we renewed our NRDL listing for heart failure, and we are thrilled that hypertension is now listed. The dip that you see in the XUSL column is for China, and that is because of the wholesaler compensation for stock given our new price.

We continue to pull through the first nine recommendations in the U S and Europe .

Continue to have good traction with the expanded label in the U S, which as you know includes five out of six patients with heart failure.

China, we renewed our R&D all listening for heart failure, and we are thrilled that hypertension is now listed.

The dip that you see in the ex U S sales column is for China and that is because of the wholesaler compensation for stock given our new price, but again. This is on the back of very good news.

Marie-France Tschudin: But again, this is on the back of very good... Now that we have the listing, we also have access to a much broader population, and if you think about the fact that only 15% of patients in China or hypertensive patients in China are well controlled versus, for example, 52 in the U.S., you can start to see the potential. For 2022, we are absolutely confident we can maintain and trust those momentum in the US and Europe, driving broader and earlier adoption, but we're also very excited about our opportunities in Asia.

Now that we have the listing we also have access to a much broader population and if you think about the fact that only 15% of patients in China or hypertensive patients in China are well controlled versus for example, 52 in the U S. You can start to see the potential.

For 2022, we are absolutely confident we can maintain and trust as momentum in the U S and Europe driving broader an earlier adoption, but we're also very excited about our opportunities in Asia.

Marie-France Tschudin: If I move on to slide 28, we're now in our third year in the marketplace with Zolgensbar, and we've treated 1,800 babies. Because this is a one-time therapy, you will continue to see volatility in the quarters as new markets gain access, as we add the bolus and then move on to an incident population. Our focus is clear.

If I move on to Slide 28, we're now in our third year in the marketplaces, all James Bond and we've treated 1800 babies.

Because this is a one time therapy, you will continue to see volatility in the quarters as new markets gain access as we add the bolus and then move on to an incident population. Our focus is clear we want to maintain a leading position in the U S. Focusing on the incident population, we want to accelerate newborn screening.

Marie-France Tschudin: We want to maintain the leading position in the U.S. focusing on the incident population. We want to accelerate newborn screening. We know it's really important to treat SMA as early as possible, and therefore our plan is to double the rate of newborn screening in Europe.

We know it's really important to treat SMA as early as possible and therefore, our plan is to double the rate of newborn screening in Europe and.

Marie-France Tschudin: And three, we want to continue on our plan for geographic expansion into emerging markets. In parallel, we're progressing with our IT formulation. We're laying the foundation to bring Zolgensma to patients across the full SMA spectrum.

And three we want to continue on our plans for geographic expansion into emerging markets.

In parallel we are progressing with our formulation, we're laying the foundation to bring intelligence by the patients across the full SMA spectrum are still study has just opened and just recruited the first patient and we're also conducting a study in pretreated patients who may benefit from this old Jonathan I was one time training.

Marie-France Tschudin: Our STEER study has just opened and just recruited its first patient. And we're also conducting a study in pre-treated patients who may benefit from Zolgensma's one-time treatment. If I move on to slide 29, with Casimta, we finished the year strong with 147 million sales in Q4. We maintain a high share of voice.

If I move on to slide 29.

We finished the year strong with 147 million sales in Q4.

We maintain a high share of voice, we now reach a critical mass with multiples for a specialist.

Marie-France Tschudin: We now reach a critical mass with multiple sclerosis specialists. We continue to onboard new patients, and the majority of those patients continue to be in first line first switch. There is no question that B-cell therapy is now the gold standard in efficacy.

Continue to onboard new patients and the majority of those patients continue to be in first line first switch.

There is no question that B cell therapy is now the gold standard standard in efficacy.

Marie-France Tschudin: We also know that there have been questions on safety in the context of COVID and this has been a priority for us to provide relevant answers to our customers. With the reassuring vaccination data that we have, we are building additional confidence in consensus profile and providing further important clinical differentiation in the market. As we drive additional uptake in the U.S. and continue to execute on our launches across the world, you can expect us to continue to do everything to make this because since the story even better. Moving on to 530.

We also know that there've been questions on safety and the content and.

Context of Covid and this has been a priority for us to provide relevant answers to our customers.

With the reassuring vaccination data that we have we are building additional confidence.

Profile and providing further important clinical differentiation in the marketplace.

As we drive additional uptake in the U S and continue to execute on our branches across the world you can expect us to continue to do everything to make this consensus story even better.

Marie-France Tschudin: As you know, we've received FDA approval in December for Lexio and we've been in the field for two weeks. On the system side, we're implementing our strategy. Our focus right now is to support the P&T reviews and the implementation of acquisition or referral processes. We've started onboarding alternative injection centers and we continue to broaden our network. We've also filed for our permanent J code as we planned.

Moving on to slide 30.

We've received FDA approval in December for like Leo and we've been in the field for two weeks on the system side, we are implementing our strategy. Our focus right now is to support the PMT reviews.

And the implementation of acquisition or referral processes.

Started onboarding alternative injection centers and we continue to broaden our network. We've also filed for a permanent J code as we planned.

Marie-France Tschudin: On the healthcare professional side, we're educating on Lectio's clinical profile, the twice-yearly dosing, and the breadth of the label. We are really excited about the enthusiasm that we're getting from the market on the clinical aspects, but also seeing the high willingness of physicians to discuss the non-clinical support options. As was said before, the first half of the year will be about laying the foundation to drive the uptake in, second half of the year and beyond when some of the larger systems should be ready for buy and bill and of course when our permanent J code should be issued.

On the healthcare professional side, we're educating unlikely I was clinical profile.

This yearly dosing and the breadth of the label we are really excited about the enthusiasm that we're getting from the market on the clinical aspects but.

Also seeing the high willingness.

To discuss the non clinical support options.

As we've said before the first half of the year will be about laying the foundation to drive the uptake in <unk>.

Second half of the year and beyond when some of the larger systems should be ready for buying bill and of course, when our permanent J code should be issued.

Marie-France Tschudin: On a separate note, we've also made significant progress with the NHS on the implementation plan and are awaiting the list on the moratorium of all non-COVID related communication and initiatives to begin the rollout of the agreement. So in summary, on slide 31.

On a separate note. We've also made significant progress with the NHS on the implementation plan and are awaiting the list on the moratorium on all non COVID-19 related communication and initiatives to begin the rollout of the agreement.

So in summary on slide 31.

Marie-France Tschudin: 2021 was a strong year for pharma. I want to thank the teams for the focus, the bold thinking and the diligence around customer obsession and market metrics to deliver exquisite execution. You will see us continue to build on that strong foundation in 2022 with the right investment not only in our products, but also in new partnerships, customer engagement, and digital tools. So thank you very much. And now let me pass it on to Susana.

2021 was a strong year for pharma.

To thank the teams for the focus the bold thinking and the diligence around customer obsession and market metrics to deliver exquisite execution.

You will see us continue to build on that strong foundation in 2022 with the right investment not only in our products, but also a new partnerships customer engagement and digital tools.

So thank you very much and now let me pass it onto Savannah.

Susanna: Thank you, Marie-France, and moving to oncology on slide 33, you see that the oncology business grew 4% in 2021, reaching 15.5 billion, with our growth drivers increasing 17% as its prior year, and also Q4 was a solid quarter growing 3% As you see, the growth was driven by continued WHO growth of brands like Kiskali, Promokta, Revolade, Tassenlar, Mechanist, and Chakali. We are very pleased to see a continued strong portfolio retruination with these growth drivers now representing 54% of the total portfolio.

Thank you Marie France, and moving to oncology on Slide 33, you can see that the oncology business grew 4% interim data into one reaching 15 5 billion, our gross drivers increasing 17% versus prior year and also Q4 of us that solid quarter growth.

<unk>, 3% as you see the growth was driven by continued double digit growth of brands like <unk> Cali, Promacta overlaid toughen, Kenneth and Chuck Kelly.

We are very pleased to see a continued strong portfolio of HOV nation mid stage growth drivers now representing 54% of the total portfolio.

Susanna: Moving to slide 34, Kiskali, we saw a very strong performance growth of 58% in Q4 reaching now 285 million in sales. We saw increased demand across all regions, as a reflection of further penetration in the first line postmanoportal sector.

Moving to slide 34, Kiskadee, Nissan very strong performance growth of 58% in Q4, reaching now $285 million in SaaS, we saw increased demand across all regions as a reflection of further penetration in the first line post spin.

Product segment.

Susanna: We continued to gain share in the U.S. with NBRX in the metastatic setting, reaching 17% in November 21. And in the international markets, we had an impressive growth of 90%, mostly driven by Europe, where we see sustained leadership in premenopausal setting, but also increased penetration in the largest postmenopausal setting. With the Mona Lisa 2 data presented at ESMO, Kishkali demonstrated the longest median overall survival so far in advanced breast cancer, and we now have OS data across all eligible patient populations.

To gain share in the U S at least and the Rx in the metastatic setting reaching 17% in November 'twenty, one and then in the international markets, we had an impressive growth of 19%.

Mostly driven by Europe , where we see sustained leadership in premium plus of setting, but also increased penetration in the largest postmenopausal setting. This team on the Liza two data presented at ESMO.

<unk> demonstrated the longest median over survival so far in advance branch cursed breast cancer, and we now have OS data across all eligible patient population.

Susanna: And this is why Kishkali is also the only CDK4 inhibitor highlighted in the U.S. NCCS guidelines to demonstrate OS benefit in first line. So we are moving forward with confidence in KISCALI. And in collaboration with the SALT study group, we have initiated the Phase III Harmonia Trials to evaluate KISCALI versus pulvocyclic in advanced breast cancer.

And this is Mike. It's currently is also the only CDK <unk> inhibitor highlighted in the U S and Ccs guidelines to demonstrate OS benefit interest then.

So the I'm moving.

Confident thank you Charlie.

And in collaboration with <unk> study group, we have initiated the phase III Harmonia trial to evaluate <unk> Connie versus <unk> in advanced breast cancer.

Susanna: In addition, we continue our geographical expansion of KISCALI with reimbursement achievement in Brazil and regulatory submission in China. As you know, our key development program is the NATALI trial studying KISCALI in adjuvant setting for both high- and intermediate-risk patients. And this study has fully recruited.

We continue our geographic expansion of <unk> Kelly this reimbursement achievement in pressure and regulatory submission in China. As you know our key development program Eastern Natalee trial studying currently in adjuvant setting for both high and intermediate.

Patients in this study is fully recruited and as Mark mentioned the readout is expected to have our end of 2022. So overall.

Susanna: And as was mentioned, the readout is expected towards the end of 2022. So overall, we are very pleased with the KISCALI performance and expect continued momentum. On slide 35, you see three of our blockbusters, popular mechanism, promoter, or revelator, and chakavis. These brands continue to deliver double-debted grows driven by strong demand across reach. Tafelar Mechanist was growing 14% with strong contribution from Europe. And just to remind ourselves, this is the first and only targeted therapy to achieve both 5-year-old survival in metastatic as well as adjuvant. And Tafelar Mechanist continues to sustain leadership in metastatic melanoma as the most used worldwide targeted therapy in the setting.

Very pleased just the case currently performance and expect continued momentum.

On Slide 35, you will see three of our blockbuster mechanist for markdown regulate and Chuck IV. These brands continued to deliver double digit growth driven by strong demand across regions.

Meg.

And last growing 14 per string 14% the strong contribution from Europe , and just to remind ourselves. This is the first and only targeted therapy to achieve a five year.

Our survival.

I think as well as <unk>.

Tough environment and this continues to sustain leadership in metastatic melanoma SD most used by targeted therapy in this setting.

Susanna: Moving forward, we expect growth will primarily come from adjuvant melanoma and non-small cell lung cancer indications, as well as the increased uptake in China. Also, promacta revelate with very strong growth with 12%, and we saw this growth across all regions with share gains supported by the sustained efficacy and oral administration convenience. And we expect continued growth in ITP and SAA. And finally, Chaka V, reaching 12% growth. This growth was driven by earlier usage in myelofibrosis and polycythema vera, and we continue with our geographical expansion on grass versus host disease launches, and we expect further uptake there as well. So moving to slide 36. Last quarter, as Vasant mentioned, we have launched Semblix in the US.

Moving forward, we expect growth will primarily come from Opdivo in melanoma, and non small cell lung cancer indication.

Well.

Creased uptake in China.

Promacta regulate lead to very strong growth.

And we saw this growth across all regions of share gain support.

Sustained efficacy and Ora administration convenient and we expect continued growth in ATP and SPP and finally, Chuck on reaching 12% growth. This growth was driven by earlier usage in myelofibrosis and polycythemia Vera and we continue.

Our geographical expansion on graft versus host Bce's launches and we expect further uptake there.

So moving to slide 36 last quarter as <unk>.

MBS launch assembly in the U S. And this is a unique stamp inhibitor with superior clinical profile in late line CML that could potentially change the standard of care.

Susanna: And this is a unique stamp inhibitor with superior clinical profile in late-line CML that could potentially change the standard of care. And you see that Semblix has a very strong clinical profile with a two-fold improvement in major molecular response and a three-time reduction in discontinuation due to a worse event. So looking at the patient potential for Semblix, that means that approximately 25% to 30% of CML patients may be eligible within the approved Semblix label.

You said assembly et cetera, very strong clinical profile. This is two solid improve in major molecular response, and the three time reduction and discontinuation due to adverse events.

Looking at the patient potential with <unk>.

We said approximately 25% to 30% of CML patients may be eligible within the approved <unk> label.

Susanna: And this includes patients' experience resistance or intolerance with previously treated two or more GKI's as well as patients with the T-350I mutation. And as you know, we have started a first-line registrational trial with filing expected in the first half of 2025. So leveraging decades of experience in DML, Semblix is off to a solid start in the US with leading share of voice already within the first month. And this is complemented by a robust digital footprint with over 20,000 users and nearly 60,000 patient website visits. We have over 50 patients enrolled in our patient assistant program and have above 150 patients included in our managed access program. Semblix is also already included in the NCNN guidelines.

And this includes patients experienced resistance or intolerance previously treated to Omar <unk> as well as patients with <unk> 350, <unk> mutation and as you would not have started their first line Registrational trial this filing expected.

First half of 2025.

So leveraging decades of experience.

Settlement exist after a solid start in the U S is leading share of voice already within the first month and this is complemented by a robust digital footprint with over 20000 users and nearly 60000 patients that surge business.

We have over 50 patients enrolled in our patient assistant program and have about 150 patients included in our managed access program. <unk> is also already included.

And CNN guidelines. So all of you also pursuing global Commerce and me say, Andy approvals in Europe , and Japan remain on track for 2021 moving to slide 37.

Susanna: So we are also pursuing global commercialization and the approvals in Europe and Japan remain on track for 2021. Moving to slide 37. With our race-aligned therapy Lutetium PSMA 617, we have another exciting launch upcoming. Lutetium PSMA has the potential to address the high unmet need in advanced metastatic castration-resistant prostate cancer.

At this hour rates a lot against therapy. The PUC on PC may 617 is another exciting launch outcome.

<unk> has the potential to address the high unmet need in advanced metastatic castration resistant prostate cancer.

Susanna: And results of the phase 3 vision trial demonstrated improved radiographic PFS and overall survival. On the commercial side, we are moving forward with launch preparations. We are targeting 435 treatment sites across the U.S. and Europe. We are leveraging our Lutathera footprint combined with an incremental field force dedicated to prostate cancer. In the U.S., that field force is fully recruited and trained. And the same is true for Europe, where we start building that field. We don't foresee any hospital capacity constraints for the launch in this vision population.

And with size of the phase III vision trial demonstrated improved radiographic PFS and overall survival.

The commercial side, we are moving forward with launch preparations.

Our targeting 400 certified treatment sites across U S and Europe , leveraging our low dose Ara footprint combined with an incremental field force dedicated to prostate cancer in the U S that field force is fully recruited and trained.

And the same is true for Europe , where we start building that fits for us.

Susanna: And on the development side, we currently have two ongoing phase C studies in the pretextate and the hormone sensitive setting with the potential to significantly expand the illiterable population by up to four times. And on the development side, we currently have two ongoing phase C studies in the pretextate and the hormone sensitive setting with the potential to significantly expand the illiterable population by up to three times. So in conclusion, moving to slide 38, I would like to conclude with three important messages.

Don't foresee any hospital capacity constraints for the launch in this patient population and on the development side. The currency has two ongoing phase III studies.

When you take say in the hormone sensitive setting with the potential to significantly expand the eligible population by up to four times.

In conclusion, I'm moving to slide 30, I would like to conclude with <unk>.

Three important messages.

Susanna: First, in 2021, we continue to see solid execution on gross brands and portfolio rejuvenation, with sales from our gross drivers increasing 70% versus prior year. With Kifkali, one of our key brands, we continue to gain share in the CDK46 class, and we have strong OS data in metastatic settings, and we are looking forward to the Nathalie readout in Ativan. And we keep our focus on launch execution with Semblix and with TCM PSMA preparation and advancing our next wave of assets. And with that, I'm handing over to Harry. Yeah, thank you very much, Susanna. Good morning and good afternoon, everybody.

In 2021, we continue to see solid execution on growth brands and portfolio, which are in Asia with sales from our growth drivers, increasing seven 2% versus prior year.

This gives kelly one of our key brands continue to gain share in the CDK four six class as we have strong listed.

That does sound exciting and we're looking forward to the nationally readout in <unk> and we keep our focus on launch execution with <unk> and the <unk> MAA preparation and advancing our next slate of assets and with that I'm handing over to Jaime.

Harry Kirsch: So I'm now going to walk you through some of the financials for the fourth quarter and the full year, as well as provide you with our 2022 guidance. As always, my comments refer to growth rates and constant currencies, unless I would note it otherwise. Turning to slide 40.

Yes. Thank you very much Suzanne a good morning, and good afternoon, everybody. So I'm now going to walk you through some of the financials for the fourth quarter and full year as well as provide you with our 2022 guidance as always my comments refer to growth rates constant.

Currencies unless noted otherwise.

Turning to slide 40.

Harry Kirsch: Here we compare briefly our results with our latest 2021 guidance as you can see overall our full year results were in line with guidance with their particularly strong innovative medicines performance innovative medicines crew the top line by 6% and the bottom line even double digit by 10%. We are pleased that despite the changing business environment during the year we were able to deliver on our expectations. Next slide, please. We finish the year on a strong quarter with sales and co-operating income growing 6 and 12 percent, respectively.

Here, we compare briefly our results with our latest 2021 guidance.

Can see overall, our full year results were in line with guidance with particularly strong innovative medicines performance.

Way. This medicines grew the topline by 6% and the bottom line, even double digit by 10%.

We are pleased that despite a challenging business environment during the year, we were able to deliver on our expectations.

Next slide please.

We finished the year on a strong quarter with sales and core operating income growing 6% and 12%.

Harry Kirsch: This resulted in full-year performance of 4% and 6% growth on top and bottom lines. Net income of $24 billion benefited, of course, from the one-time gain from the Roche staked divestment of $14.6 billion. But even if you exclude that effect, and you see it in the lower line with below net income, net income grew a hazy 15% mainly due to higher sales and productivity gains.

Expect to flee this resulted in full year performance of 4% to 6% growth in top and bottom line.

Net income of 24 billion benefited of course from the onetime gain from the Roche stake divestment of $14 6 billion, but even if you exclude that effect in the ceded the lower line.

<unk> net income net income through 15.

15%, mainly due to higher sales and productivity gains.

Harry Kirsch: Core EPS grew 7% mainly from a strong co-operating income growth and was slightly impacted by the Roche divestment in quarter four. Free cash flow was up 14%. Reaching 13.3 billion, and I will go a bit into more details about free cash flow a little later. Before we move on, I just wanted to highlight that quarter four sage grows, includes a positive one percent point impact from a small reclassification effect of contract manufacturing from other revenues to sales. Slide 42, please. This slide shows you the performance by division for the quarter and full year.

Core EPS grew 7% mainly from a strong core operating income growth and were slightly impacted by the Roche divestment in quarter for free cash flow was up 14%, reaching $13 3 billion and I will go into more details about free cash flow a little later.

Before we move on just wanted to highlight this quarter for sales growth.

Includes positive 1% point impact.

From a small reclassification effect of contract manufacturing from other revenues to sales.

Slide 42 please.

This slide shows you the performance by division for the quarter and full year clear.

Harry Kirsch: Clearly, Innovative Medicines had a strong year, driven by our key growth drivers, Entresto, Gosendix, Zolgensma, and the key oncology brands, which also Marie-France and Susanne laid out. The Innovative Medicine Sales, 26% Bottom Line, 10% [inaudible] and margins reaching 36.2% points up from 32% in 2018. So an increase over the three year period of 420 basis points. For the quarter, in a way, this medicine saves crew seven and cooperating income 15%. As Voss mentioned, Sandoz is still facing some challenges, mainly from pricing pressures, especially in the U.S. and COVID-related demand impacts, although Quarter 4 showed signs of stabilization. Now let's turn to slide 43. Free cash flow of the year was mainly driven by the higher operating income and was up 14% to $13.3 billion.

Clearly innovative medicines had a strong year driven by our key growth drivers and <unk> and the key oncology brands, which also Marie France, and Susana laid out.

Innovative medicines sales grew to 6% bottom line, 10% and margins, reaching 36, 2% points up from 32% in 2018, So an increase over the three year period of 420 basis points for the quarter and the way this medicine Sage grew 7%.

And cooperating income 15%.

As Ross mentioned sandals still facing some challenges mainly from pricing pressures, especially in the U S and COVID-19 related demand impact although quarter four showed signs of stabilization.

Yes.

Now, let's turn to slide 43.

Free cash flow of the year was mainly driven by the higher operating income and was up 14% to $32 3 billion.

Harry Kirsch: There were also lower payments from legal matters in 2021 compared to what we had in 2020. This was offset, as you can see, by the upfront payment for in-licensing of digitalism from Beijing. On the next slide. I'm very pleased to announce that we will propose our 25th consecutive dividend increase to 3.10 francs. Persiair from three francs last year.

There were also lower payments from legal matters in 2021 compared to what we had in 2020. This was offset as you can see by the upfront payment for in licensing and licensing of lithium up from Beijing.

On the next slide.

I'm very pleased to announce that we will propose our 25th consecutive dividend increase to <unk> 10 per share from <unk> last year.

Harry Kirsch: This is an increase of 3.3% in Swiss francs and 6% in US dollars, with our dividend reaching 4%, and fully align with our dividend policy of dividend increases every year in Swiss franc. Now turning to slide 45. Will we sum up our guidance on top and bottom line? With the divisions, we expect another year of innovative... Madison Sales, Crowing, mid-single digits, and cooperating income to Crowe mid to high-single digits, The expected Innovative Medicine's core margin increase will be driven by the expected good top-line momentum and continuation of our productivity program.

This is an increase of three 3% in Swiss franc and 6% in U S dollars.

With our dividends, reaching 4%.

And fully aligned with our dividend policy of dividend increases every year in Swiss francs.

Now turning to slide 45.

We sum up our guidance on top and bottom line.

The divisions, we expect another year of innovative.

Medicine sales growing mid single digits and core operating income to grow mid to high single digits.

Sales.

Do you expect it innovative medicines core margin increase will be driven by the expected good top line momentum and continuation of our productivity programs for Sandoz, We expect top line to be broadly in line with prior year and core operating income to decline low to mid <unk>.

Harry Kirsch: For sandals, we expect the top line to be brought in line with prior year and co-operating income to decline low to mid-single digit, mainly driven by gross margin pressures due to pricing, Also on the top line, it's also due to the fact that we do not expect many launches for Saunders in 2022.

You'll digit mainly driven by gross margin pressure is due to pricing and product mix.

Also on the top line.

It's also true to the fact that we do not expect many launches for sandoz in 'twenty to 'twenty two.

Harry Kirsch: With respect to the entire group, we expect both the top and the bottom line to grow mid-single digit. The key assumption for this guidance, as you can see in the bottom box here, is that we are continuing to return to normal global healthcare systems, including prescription dynamics, and that no Sandoz-studded LAR generics would enter in the U.S. in 2022. On slide 46.

With respect to the entire group, we expect both the top and bottom lines drove mid single digit.

The key assumptions for this guidance as you can see on the bottom box here.

We are continuing to return to normal global healthcare systems, including prescription dynamics and that no Thunder started LDR generics would enter in the U S 2022.

On slide 46.

Harry Kirsch: I would like to add some perspective on other key financial elements of our expected core net income performance. As you can see, we expect core net financial results to be brought in line versus 2021. And the 2022 core tax rate is expected to be in the range of 17 to 17.5 percent. This is higher than the 16 percent core tax rate range we experienced over the last couple of years.

I would like to add some perspective on other key financial elements of our expected core net income performance.

As you can see we expect core net financial results to be brought in line versus 2021.

And the 2022 core tax rate is expected to be in the range of 17% to 17, 5%. This is higher than the 16% core tax range.

Tax rate range.

Over the last couple of years. However, as you can see above approximately 1% point of this increase is due to the mathematical impact of the Roche divestment.

Harry Kirsch: However, as you can see, approximately one percent point of this increase is due to the mathematical impact of the Roche divestment. And there may also be a slight increase due to geographical profit mix changes, which we will monitor throughout the year. Finally on slide 47. For modeling purposes, we thought it would be very helpful to you to go into some details regarding the currency impact, especially given the recent appreciation of the US dollar. As you saw before, currency had a negative impact, of 2% on that sales is negative 3% point impact on cooperating income.

There may also be a slight increase to two geographic profit mix changes, which we will monitor throughout the year.

Finally on slide 47.

For modeling purposes, we thought it would be very helpful to you to go into some details regarding the currency impact, especially given the recent depreciation of the U S dollar.

Solid quarter for currency had a negative impact.

2% on net sales of negative 3% point impact on core operating income.

Harry Kirsch: As the U.S. dollar further strengthened, this currency effect, of course, also impacted the sales of our key growth drivers, ex-U.S., in Q4. If late January rates prevail for the remainder of 2022, we would expect the full year impact of currencies on top line to be at negative 3 percent points and on bottom line negative 4 percent. In quarter one, the impact is a bit more pronounced. I'd say it would be negative four and a bottom line negative five points.

The U S dollar further strengthened.

This currency effect of course also impacted sales of our key growth drivers ex U S in quarter four.

If late January rates prevail for the remainder of 2022, we would expect full year impact of currencies on top line to be a negative 3% points and on bottom line of negative 4% points quarter.

Quarter, one <unk>.

<unk> is a bit more pronounced on sales would be negative for.

Bottom line negative five points.

Harry Kirsch: As currency rates are quite volatile as we all know, we update this impact estimate every month on our websites. And with this, I hand it back to Lars. Terrific. Thank you, Harry. So moving to slide 49, and briefly in closing. In 2021, we delivered on our goal of guidance of mid-single-digit top-line growth, margin expansion, strong free cash flow. We remain confident in our in-market growth drivers, six major brands that are performing well across geography, supporting our confidence and our outlook of 4% plus sales gator to 2026.

If currency rates are quite volatile as we all know we update this impact estimate every month.

Websites and with this I will hand, it back to Bob.

Right.

Terrific. Thank you Harry so moving to slide 49 and briefly in closing.

2021 we delivered on our goal of mid single guidance of mid single digit topline growth margin expansion and strong free cash flow.

We remain confident in our in market growth drivers six major brands that are performing well across geographies supporting our confidence in our outlook of 4% plus sales period of 2026.

We are continuing to deliver important innovation milestones across the portfolio and we'll work over the coming.

At 12 months to 24 months to deliver important milestones on our 20 plus year assets and we remain balanced in our capital allocation continuing to invest in innovation alongside returning capital to our shareholders.

Harry Kirsch: We've continued to deliver important innovation milestones across the portfolio, and we'll work over the coming 12 to 24 months to deliver important milestones on our 20 plus fiat. And we remain balanced in our capital allocation, continuing to invest in innovation alongside returning capital to our shareholders. And with that, operator, we can open the lines for questions. I would ask that each questioner limit themselves to one question and we'll try to go multiple times through the round as far as we can in the allotted time.

And with that operator, we can open the line for questions I would ask that each questioner limit themselves to one question and we'll try to go multiple times through the round as far as we can and the a lot of time. Thank you.

Operator: Thank you. Thank you. Thank you very much, ladies and gentlemen. If you have a question, please press star and one on your telephone keypad. Please limit yourself to one question only. Again, that's star and one.

Thank you. Thank you very much Sir ladies and gentlemen, if you have a question. Please press star one on your telephone keypad. Please limit yourself to one question only again that star. One if you have a question. Your first question today comes from the line of Graham Parry Bank of America. Please go ahead. Your line is open.

Operator: If you have a question. Your first question today comes from the line of Graham Parry, Bank of America. Please go ahead, your line is open.

N.

Graham Parry: Great, thanks for taking my question. So just regarding the Sandals review, obviously you're looking there and you're saying all options are still on the table despite there being some recent speculation again about there being some private equity interest. When you're considering a sale versus spin versus keeping the business, how much consideration are you giving to what multiple you think the market would value Sandals at versus what an acquirer might view it at?

Great. Thanks for taking my questions.

And just regarding the sandals review.

Obviously, youre looking that and you're saying all options still on the table. Despite there being some recent speculation again about there being some private equity interest and when you're considering a sale versus spin versus keeping the business how much consideration that you're giving to what multiple you think the market with valleys sandals at FIS is water and acquire and Mike.

View attach and secondly in the scenario of a sale will ease of cash would you consider given that you're already doing a large buyback and so with the intent that should be treated as capital invest to investors.

To put it back into the business through M&A and organic investment. Thank you.

Vasant Narasimhan: And secondly, in the scenario of a sale, what uses of cash would you consider given that you're already doing a large buyback? So would the intent there to be to return capital to investors or to put it back into the business through M&A and organic investment? Thanks, Graham, for the question. Let me start with where we are on the process. And I think as we guided at the end of last year, the first part of this year is really focused on carving out the financials for Sandoz, being clear on the perimeter, and then being able to provide potential counterparties with the relevant information for them to make concrete formal offers, whether those are private equity, or other companies.

Thanks Ram for the question, let me start with where we are on the process I think as we guided at the end of last year. The first part of this year is really focused on carving out the financials for sandoz being clear on the perimeter and then being able to provide potential counterparties with the relevant information for them to make.

Concrete formal offers whether those are private equity.

Or are there other companies alongside that evaluate the options for a potential spin of the business and lastly, a potential retention of the business. We were going through the work right now of evaluating those different options and I expect that to take us to the mid middle of this year before then we can take.

Vasant Narasimhan: Alongside that, evaluate the options for a potential spin of the business. And lastly, a potential retention of the business. We are going through the work right now of evaluating those, those different options. And I expect that to take us to the mid middle of this year.

The next step hopefully come to a decision in the second half of the year in terms of considerations. We're of course always looking at a few things one how to make sandoz as successful as possible with <unk>.

Consistent with the aspiration for Sandoz to become the leading generic company.

Vasant Narasimhan: Before then, we can take the next steps and hopefully come to a decision in the second half of the year. In terms of considerations, we're, of course, always looking at a few things. One, how to make Sandoz as successful as possible with consistent with the aspiration for Sandoz to become the leading generic company in the world. Second, what is most value creating and also tax efficient for our shareholders.

The World second what is most value, creating and also tax efficient for our shareholders.

I think we've proven with the Alcon spin that we're able to think through those considerations in a way that is beneficial to the shareholders and really making sure. We're thinking about these things in a shareholder friendly way and I think it's really premature for us to speculate if there were.

Quote unquote sale, how we would use the cash and I think we're still a long ways away from that point in time, and we would of course be able to determine that at that point in time, but we would stay consistent with our balanced capital allocation approach, which I outlined earlier thinking through investing in the business versus returning returning value to shareholders.

Vasant Narasimhan: We, I think, have proven with the Alcon spin that we're able to think through those considerations in a way that is beneficial to the shareholders and really making sure we're thinking about these things in a shareholder friendly way. And I think it's really premature for us to speculate if there were a quote unquote sale, how we would use the cash. And we think we're still a long ways away from that point in time.

Vasant Narasimhan: And we would, of course, be able to determine that at that point in time, that we would stay consistent with the balanced capital allocation approach, which I outlined earlier, thinking through investing in the business versus returning, returning value to shareholders. So thanks for the question, Graham. Next question, operator. Thank you. Your next question comes from the line of Richard Parkes, BNP Paribas. Please go ahead, your line is open.

So thanks for the question Graham next question operator.

Thank you. Your next question comes from the line of Richard Parkes BNP Paribas. Please go ahead. Your line is open.

Richard Parkes: Hi, thanks very much for taking my question. I've got a question on capital allocation, I remember on the last call, you mentioned that you were engaging with investors around the sort of balance of returning the capital from the, the rush takes out between sort of buybacks and an M&A. And I just wondered how your thoughts on M&A and business development had evolved based on that feedback. I'm just wondering if, more meaningful bolt-ons have moved up or down the priority list based on that feedback.

Hi, Thanks very much.

Taking my question.

A quick question on capital allocation I remember on the last call. You mentioned that you are engaging with investors around sort of balance of returning.

Capital from the Roche stake sale between so.

Buybacks and M&A and I, just wondered how your thoughts on.

M&A and business development.

Based on that feedback going just wondering if more meaningful all forms of moved up or down the priority list based on that feedback. Thank you.

Vasant Narasimhan: Thank you. Yeah, thank you. Thank you, Richard. I think not much more to say on the feedback.

Vasant Narasimhan: I mean, what I can, what I think we can say is that we know that given the strong cash flow that we generate at Novartis, we have the ability to continue to do a bolt on acquisitions like we've done in the past when we find attractive assets that fit with our therapeutic area goals and our platform goals. As we evaluated the situation over the course of December, it became clear that at this point in time, we could return significant capital to shareholders through the buyback while maintaining the ability to also do attractive accretive M&A if it should materialize.

Yes. Thank you. Thank you Richard I think not much more to say on the feedback I mean, what I can I think we can say is that we know that given the strong cash flow that we generate at Novartis. We have the ability to continue to do bolt on acquisitions like we've done in the past when we find attractive assets that fit with our <unk>.

Therapeutic area goals and our platform goals as we evaluated the situation over the course of December it became clear that at this point in time, we could return significant capital to shareholders through the buyback while maintaining the ability to also do attractive accretive M&A if it should materialize.

Vasant Narasimhan: So right now, our focus is, of course, first and foremost, on driving the business and then evaluating various options that are out there over time. But of course, being very patient to ensure we only do deals where we're confident that we can generate significant returns for the company and also fit with our strategic priorities. So I would say there's nothing imminent and we're going to continue to evaluate the options and watch how valuations move in the sector and then look for opportunity as they arise.

So right now our focus is of course first and foremost and driving the business and then evaluating various options that are out there over time, but of course being very patient to ensure we when we do deals where we're confident that we can generate significant returns for the company and also fit with our strategic.

Vasant Narasimhan: We're quite happy to continue to do deals like the four deals that we did in quarter four that enabled us to acquire four mid-stage and or late-stage assets through various deal structures at attractive financial terms.

Priorities.

So I would say, there's nothing imminent and we're going to continue to evaluate the options and watch how valuations move in the sector.

And then look for opportunities as they arise.

Quite happy to continue to do deals like the four deals that we've done in quarter four that enabled us to acquire four mid stage and early stage assets.

Various deal structures.

Think at attractive financial terms.

Harry anything else you wanted to add on that.

Vasant Narasimhan: No, I think one element to see, I think, you know, also feedback on the 50 billion share by a bag has been quite positive and also maybe some analysts and investors are not.., very familiar with the Swiss system where we have to buy these on the second line for cancellation and that takes then until the middle to um to the second half of next year so 23 right unlike like US situations where you can do this quite quickly so um as we see then can monitor the market we do as much as we can on this 50 billion share buyback as you go forward so there's also a bit of time to continue to think about the different ways of of capital allocation and then of course we have to see as Vaas mentioned you know would there be a great opportunistic M&A opportunity here and otherwise as we laid out the capital allocation priorities that's how we're gonna gonna allocate continuously our capital, Thank you, Eric. Thank you very much.

No I think one element to see I think ultra feedback on the 50 billion share buyback has been quite positive.

Also maybe some analysts investors or not.

Familiar with the switch system, where we have to buy these on the second line for cancellation and that takes then until the middle to.

Through the second half of next year.

So 23.

Like like U S situations, where we can do this quite quickly so.

We see that can monitor the markets, we do as much as we can on this 50 billion share buyback as we go forward. So there is always a bit of time to continue to think about different ways of capital allocation and then of course, we have to see as Ross mentioned.

Would there be a great opportunistic.

M&A opportunity here.

Otherwise as we laid out the capital allocation priorities, that's probably going to go into allocate continuously our capital.

Thank you Terry.

Next question operator.

Vasant Narasimhan: Next question, operator. Thank you. Your next question comes from the line of Laura Sutcliffe from UBS. Please go ahead, your line is open. Hello, thanks. A question on LECRIO, please. You've talked a lot about the hard work you've done in removing access and reimbursement hurdles in the US, but do you think you need any specific guideline inclusions or recommendations to start driving use there?

Thank you. Your next question comes from the line of Laura Sutcliffe from UBS. Please go ahead. Your line is open.

Thanks.

Please you talked a lot about the hard work, you've done and removing access and reimbursement hurdles in the U S. But do you think you need any specific guideline inclusions of recommendations to start driving that.

Laura Sutcliffe: And is there the possibility of sort of trying to protocolise this in any way in your centres of interest to get sales going? Thank you. Thank you. Thank you. I think, Laura, Morgh, Maryfine.

Yeah.

And is there a possibility is sort of tying to protocol is this in any way.

Centers of interest to us to get sales going.

I think Laura.

Right.

Marie-France Tschudin: [inaudible] Yeah, so the first thing I'd say is that LDL lowering is already widespread across the guidelines, and we already have class 1A in Europe. So when you ask your question, the intense philosophically of us going or concentrating on the 200 systems of care is exactly that. It's around how do you protocolize the use or the management of lipid lowering within a system.

Yes. So the first thing I'd say is that LDL lowering is already widespread across the guidelines and we already have class one in Europe .

So when when when you ask your question.

Tons philosophically of us going.

We are concentrating on the 200 systems of care is exactly that it's around how do your protocol wise, they use or the management of lipid lowering within the system. So how that looks like concretely will probably depend system by system, but as you know we've just launched our cooperation.

And with the 8-K, which is around is not necessarily specific to <unk>, but it is around how do you better monitor and control cholesterol lowering.

Marie-France Tschudin: So how that looks like concretely will probably depend system by system. But as you know, we've just launched a cooperation with the AAT, which is around. It's not necessarily specific to LECVO, but it is around how do you better monitor and control cholesterol lowering for patients. So the intense is there.

For patients. So the intent is there it's about making sure that we can identify the care pathways and then also support the center.

How they can specifically identify patients to come in when their LDL is not at the level that it should be or not at all so you're absolutely right. That's the intent that's the way we're looking at it locally it's going to look very different country by country system by system, but that's but that's the goal and ultimately will change.

Marie-France Tschudin: It's about making sure that we can identify the care pathways and then also support the centers in how they can specifically identify patients to come in when their LDL is not at the level that it should be or not at goal.

Marie-France Tschudin: That's the way we're looking at it. Locally, it's going to look very different country by country system by system. But that's, but that's the goal.

The landscape in ASC BD, because today, even though there are medicines on the marketplace.

Marie-France Tschudin: And ultimately, we'll change the landscape and CVD because today, even though there are medicines on the marketplace, patients are not being treated, and they're not at goal, and therefore, you see 18 million deaths worldwide because of CVD. Thanks very much.

Patients are not being treated and theyre not at call and therefore, you see 18 million deaths worldwide.

<unk> CBD.

Thanks for your comments, Thank Laura next question operator.

Operator: Thanks, Laura. Next question, operator. Thank you. Your next question comes from the line of Andrew Baum from City. Please go ahead, your line is open.

Thank you. Your next question comes from the line of Andrew Baum from Citi. Please go ahead. Your line is Nathan.

Andrew Baum: Many thanks. Could you just outline for us the differences between the 50,000 Victorian 2P and the Iran 4 trial for Letdio? I'm assuming this is just a sort of marketing-based phase 3 to expand clinician experience, but maybe I've missed something different about the patient populations apart from the subtleties. And maybe if you have a second, perhaps you could comment on the legalism at surprise, given how robust the pretty large phase 2B data was. Is this the Zola arm is better than expected?

Many thanks could you just outline for us the differences between the 60000 Victorian QP and the Orion four trial for Latvia.

<unk>. This is just sort of marketing based phase III to expand clinician experience, but maybe I've missed something different about the patient population department the subtleties and maybe if you have a second perhaps you could comment on the nickel lithium app surprised given how robust the pretty large phase <unk> data was is this that the zone.

The better than expected if.

If you have any insights would be great to hear thank you.

Andrew Baum: If you have any insights, it'd be great to hear. Thank you. I think. Thanks, Andrew. John.

Yes.

Thanks, Andrew.

John .

John: Yeah, sure. Thanks for the question, Andrew. Specifically on Lectio, as you know, the study Orion IV, which is being conducted in the UK, is more of a population-based approach to looking at secondary prevention.

Yes sure. Thanks for the question, Andrew specifically on <unk> as you know the.

Study Orion four which is being conducted in the U K is more of a population based approach to looking at secondary prevention and that is mostly in the U K with some patients in the U S.

John: And that is mostly in the UK with some patients in the US. The V2P is a broader patient population where we're going globally, not only in the US, but across major geographies throughout the world. And we know that there are differences in practice patterns throughout the world.

<unk> is a broader patient population, where we're going globally not only in the U S, but across major geographies throughout the world. So and we know that there are differences in practice patterns throughout the world. So what we intend to do is ensure we follow these patients and make sure that we have a clear understanding of.

John: So what we intend to do is ensure we follow these patients and make sure that we have a clear understanding of the treatment for secondary prevention for LECVEO. So those are the approaches that we're taking in difference of Orion IV versus LECVEO. And back on your question for legalismab and what we've seen, you know, we started the phase three study, Purcell I and Purcell II, which were designed against the active comparator, which was omelismab. These studies were based on primary endpoints that we saw through our phase two B study.

The treatment for secondary prevention for <unk>. So those are the approaches that we're taking different Orion four versus like payout.

John: And those, that phase two B study had 380 patients and 80 patients per arm. And as we've actually demonstrated, or showed during the fourth quarter, as we shared at the R&D day, we did achieve the primary end point of superiority versus placebo. But we did not demonstrate superiority versus omelismab.

And back on your question.

For Legalism App and what we've seen we started the phase III study.

Pearl one in Perl to which were designed against an active comparator, which was Omalizumab. These studies were based on primary endpoints that we saw through our phase <unk> study and those that phase <unk> study had 380 patients 80 patients per arm and as we've actually demonstrated.

John: We're currently reviewing that data and we're evaluating the best potential for moving that forward. And as vast stated earlier, we're advancing the studies in sendo and food allergy and they're continuing as planned. And maybe Andrew, just one additional point to John's comments to your specific point, we did see omelizumab perform better in the Phase 3 study versus the Phase 2 study. So that is a leading hypothesis we have, but I think still more work to do to fully ascertain why we saw the difference between the Phase 2B in the New England Journal and the results that we saw in Phase 3. So as soon as we have a better understanding, we'll of course share it. In the meantime, legalizumab continues to develop it in food allergy and Sindhu given the lack of an IgE drug for those.

<unk> showed during the fourth quarter as we shared at R&D day, we did achieve the primary endpoint of superiority versus placebo, but we did not demonstrate superiority versus omalizumab.

We're currently reviewing that data and we're evaluating the best potential for moving that forward.

As Bob stated earlier, we're advancing studies in <unk> in food allergy and they are continuing as planned.

And maybe Andrew just one additional point to John's comments to your specific point, we did see omalizumab perform better in the phase III study versus the phase II study so that is our leading hypothesis.

But I think still more work to do to fully pass.

<unk> why we saw the difference between the phase to be in the New England Journal.

The result that we saw in phase III. So as soon as we have a better understanding we'll of course share. It in the meantime, legal is continuing to develop it in food allergy and can do given the lack of an IV drug for those indications.

Vasant Narasimhan: Thanks, Andrew. Next question, operator. Thank you. Your next question comes from the line of Simon Baker from Red Dunn. Please go ahead your line as open.

Thanks, Andrew next question operator.

Simon Baker: Thank you for taking my question. It's a question on the impact of COVID-19 specifically in three areas for you. Firstly, could you give us an update on the on the dynamic MS market as it affects Kasympte and also, and Steve Allen. Thank you, Simon.

Thank you. Your next question comes from the line of Simon Baker from Redburn. Please go ahead. Your line is open.

Thank you for taking my question.

It's a question on the impact of Covid specifically.

Specifically in three areas for you.

Firstly could you give us an update on the.

On the dynamic EMS markets. Thanks.

Yes.

And also recruitment into the phase III <unk>.

Study that started in fourth quarter and also select via in the UK, France, you mentioned the NHS knowing kind of the block is about to be released but I just wondered how the significant backlogs within the UK health care system could potentially impact the rate at which you will accrue the target number of patients over the next few years. Thanks, so much.

Marie-France Tschudin: So first, Mary France on the MS market and Lectio NHS. Yeah, so maybe maybe I'll just start off by saying that, you know, we're all getting used to COVID. And I think not only not only the industry, but also healthcare systems, in general, we're sort of learning to become more and more agile. But it is true that there, there are areas that are disproportionately impacted.

Thank you Simon so firstmerit funds on the Ms market and let Theo NHL.

Marie-France Tschudin: And clearly, the dynamic multiple sclerosis market, if you look at it, it is still below pre COVID levels. And we are also seeing, you know, as you said, a delay in our Alexio launch in the UK, given this moratorium on anything that's not COVID related. So, you know, ultimately, yes, it's true. I don't think for Cassintha, it's slowed us down.

Yes, so maybe maybe I'll just start off by saying that.

No.

We're all getting used to COVID-19 .

I think not only not only the industry, but also health care system in general.

Learning to become more and more agile, but it is too that there there are areas that are disproportionately impacted and clearly the dynamic multiple sclerosis market. If you look at it it is still below pre COVID-19 level and we are also seeing as you said a delay in.

Marie-France Tschudin: I can I can already say, for example, that in the beginning of the year, we already have all of our patients re verified. We've tried as much as possible be out there with with physicians, our share of voices high, we have absolutely doubled down on patient services to make sure that that that patients are, you know, not not left out in the cold in this whole in this whole sort of pandemic era.

<unk> launched in the U K given this moratorium on anything that's not COVID-19 related so.

Currently yes, it's true I don't think for Cosenza, it slowed us down I can I can already say for example that in the beginning of the year, we already have all of our patients we verified.

Try to as much as possible will be out there with with physicians our share of voice is high and we have absolutely doubled down on patient services to make sure that that patients are.

Marie-France Tschudin: So I do think it's, it's almost allowed us to, to basically rethink some of the way that we approach the market and do better. However, it's a clear reality on on certain areas, and not only those, For the UK, as I said this morning, it hasn't really slowed us down on the implementation. I mean, we've been working really diligently in the background on things that we would have had to do anyway, right?

Not not left out in the call then this whole in this whole sort of pandemic era. So I do think it is.

Almost allowed us.

So basically we think.

Some of the way that we approach the market and do better.

However, it is a clear reality on a.

Certain areas and not only though.

Marie-France Tschudin: So, NHS guidelines, making sure that the communication is ready to go out. Looking at, for example, the patient digital identification, NHS guidelines have already been written. So I think when this moratorium is listed, and of course, remember that this is all in the primary care sector. So our entire plan for the NHS is centered around the primary care physician, and that's where the moratorium is. So we're waiting for that to be listed, but I do want to reassure the audience that we're not at a standstill. We're doing the things that we would have to do anyway.

Part of the U K.

As I said this morning.

Haven't really slowed us down on the implementation I mean, we've been working really diligently in the background on things that we would have had to do anyway right. So NHS guidelines is making sure that the communication is ready to go out looking at for example.

That patient digital identification.

NHS guidelines have already been written so I think when this moratorium is lifted and of course remember that this is all in the primary care.

Sector. So our entire plan for the NHS is centered around the primary care physician and that's where that's where the moratorium is.

No.

We're waiting for that to be lifted, but I do I do want to reassure.

The audience that we're not we're not at a stand still we're doing the things that we would have to do anyway and laying the groundwork for the future and with that.

Marie-France Tschudin: And laying the groundwork for the future. And with maybe a last word on Kassanta, we're bullish on our ability to double sales in the US. We've got approval in 63 countries around the world.

Maybe a last word on Cassandra.

We're bullish on our ability to double sales in the U S. We've got approval in 63 countries around the world, we're working through reimbursement and so we believe it's going to be a good year for <unk>. Despite despite the local.

Let's say lockdowns or pandemic influence that we see across the globe.

Marie-France Tschudin: We're working through reimbursement. And so we believe it's going to be a good year for Kassanta despite the local lockdowns or pandemic influence that we see across the globe. And then, John, on Remibrutinib recruitment, any insight yet? Absolutely. Thanks for the question, Simon. You know, the MS space is one that we know very well from our experience and the studies that we conducted across Gilenya, Mazent, as well as Kasympta. We announced earlier in the year, in 2021, that we were advancing with Remibrutinib, which is our selective molecule BTK inhibitor in the space. We had discussions in the middle of the year to late in the year with regulatory authorities, and we've already started recruiting at the end of the year. And we know the space well.

And then John on Remy brute nib recruitment any any insight yet.

Absolutely. Thanks for the question Simon.

MS Space is one that we know very well from our experience in the studies that we've conducted across Gilenya amazement as well as cause symptoms, we announced earlier in the year in 2021 that we were advancing with Remy Bruton, which is our selective molecule <unk> inhibitor in this space, we have discussions in the middle.

All of the year or too late in the year with regulatory authorities and we've already started recruiting at the end of the year and we know the space. While we're confident that we can recruit in the EMS space and that we're excited to continue their fulfilled criteria in terms of advancing the recruitment for the MF patients for Remy fruit yet.

John: We're confident that we can recruit in the MS space and that we're excited to continue to fulfill the criteria in terms of advancing the recruitment for the MS patients for Remi. Thanks, John. Thanks, Simon.

Yeah.

Great. Thanks, Don Thanks Simon.

John: Next question, operator. Thank you. Your next question comes from the line of Tim Anderson, Wolfe Research. Please go ahead, your line is open. Yes, thank you for taking my question. It's Richard Wagner, Wolf Research for Tim Anderson.

Next question operator.

Your next question comes from the line of Tim Anderson Wolfe Research. Please go ahead. Your line is open.

Yes. Thank you for taking my question, Richard Wagner Wolfe Research for Tim Anderson.

Richard Wagner: My question on M&A, whether you can say definitively that you won't do larger M&A, meaning something that would be, say, $30 billion or larger. Thank you. Yeah, thanks for the question, Richard. We don't have plans to do, quote unquote, larger M&A.

Question on M&A.

Whether you can say definitively that you won't do larger M&A, meaning something that would be say $30 billion or larger.

Hugh.

Vasant Narasimhan: Hard to sign up for specific thresholds given, you know, the dynamics in the market. But our focus is not larger M&A, our focus is bolt-on. Bolt-on deals, most of the deals we've done, as I mentioned earlier, have been sub $1 billion up front with payouts for the total deal value of less than $2 billion in recent times, including the four deals that we recently signed.

Yeah. Thanks for the question Richard We don't have plans to do quote unquote larger M&A.

Hard to sign up for specific threshold, given the dynamics in the market, but our focus is not larger M&A. Our focus is bolt on.

OLT on deals most of the deals we've done as I mentioned earlier have been sub $1 billion upfront with payout for the total deal value of less than $2 billion in recent times, including the four deals that we recently signed and we continue to focus our energies. There we look at larger asset valuations are stretched expectations were.

Vasant Narasimhan: And we continue to focus our energy there. We look at larger assets, valuations are stretched, expectations remain high, harder to make the numbers work to create value for shareholders and an attractive profile for Novartis. But we continue to assess those, what's called the larger bolt-on deals. And then beyond that, we are not looking at large M&A now.

Hi, harder to make the numbers work to create value for shareholders and an attractive profile for Novartis, where we continue to assess those.

Let's call them larger.

Bolt on deals and then beyond that we are not looking at large M&A.

At this time.

No.

Next question operator, Thank you Richard.

Vasant Narasimhan: At the, So next question, operator. Thank you. Thank you. Your next question comes from the line of Kerry Holford from Berenberg. Please go ahead, your line is open. Thank you very much, a question, please, on the shuttle.

Thank you.

Next question comes from the line of Kerry Holford from <unk>. Please go ahead. Your line is open.

Yes.

Thanks very much question.

Armando.

Yes.

Kerry Holford: Thank you. In your presentation, Harry, you're speaking of stabilization in Q4, but... I wonder if you can walk us through the drivers of your guidance for operating profit decline this year. Is that predominantly price pressure, more of the same, there'll be disruption?

Daniel Thanks for having us.

Hi, guys.

You bet.

Trying to think between title the richness.

Thanks.

You can walk us through the drivers.

Operator.

Decline.

The government price pressure more of the same.

Sure.

Vasant Narasimhan: Lutz, and some elements of more investment required to see the top line of the division returned [inaudible] I guess specifically I'm looking for what you expect to get more difficult for Sandoz this year versus last, given the stabilization signs you mentioned in Q4. And then just a very quick follow-up. Can we assume the contract manufacturing revenue reclassification that you mentioned in the quarter is a one-off event? Thank you. Thanks, Kerry. So maybe first on Sandoz, Richard, you want to start and then maybe Harry can chime in.

Thanks.

Parliament.

Glad to see topline condition with <unk>.

<unk>.

I'm not sure.

We expect to get more antithetical to standardization.

Thanks for giving us time to stabilization.

Paul.

And then just if I could follow up can we assume of course that manufacturer.

Potentially you mentioned in the cortex.

Okay.

Yes.

Thanks, Kerry so maybe first on Sandoz, Richard do you want to start and then maybe Harry can chime in.

Vasant Narasimhan: Thank you, Vasant. Thank you for the question, Kerry. Yeah, as I said, look, in Q4, we saw things returning to a more normal state of affairs and a nice, I guess, solid performance for Q4. As we go into 2022, I mean, we've seen good growth from the rest of the world, and really the challenge continues to be the U.S. And that's slowly, the impact of price clearly drives the issues in the U.S., but we're slowly stabilizing.

Sure. Thank you Vanessa and thank you for the question Gary.

As I said about people, we saw things returning back to a more normal state of affairs.

Have a nice solid performance with quarter four as we go into 2022.

Good growth from the rest of the World and really the challenge continues to be the U S and thats.

Slowly.

The impact of price clearly drives.

The issues in the U S but.

With slowly stabilizing and so really I see 2022 is a year, where the rates of decline in the U S stabilized, but it does drag down the overall business price still has a significant impact and also bear in mind 2022, we don't see many significant launches, it's still a fairly quiet year in terms of that OE launches.

Vasant Narasimhan: And so really, I see 2022 as a year where the rate of decline in the U.S. starts to stabilize, but it does drag down the overall business. Price still is a significant impact. And also, bear in mind, 2022, we don't see many significant launches. It's still a fairly quiet year in terms of LOE launches.

Richard: So really, the impact on bottom line is really a mixture of price and mix, and we expect that then to slowly start changing as we come out of 23 into 24 as the biologics pipeline starts to kick in again, and the U.S. continues its stabilized journey, and we see accelerative growth then in Europe and the rest of the world. Thanks, Richard. And then, Harry, on contract manufacturing, and if you have any other comments, I'll send it. You know, I think Richard said it all on sandals.

So really the impact on bottom line, it's really a mixture of price and mix and we expect that then to slowly start change as we come out of 23% to 24 is the biologics pipeline starts to kick in again on the U S continue to stabilize journey and we see accelerated growth in Europe , and the rest of the world.

Thanks, Richard and then Harry on the contract manufacturing or any other comments on incentive.

Harry Kirsch: In terms, Kerry, of contract manufacturing, you know, we have reported, relatively small contract manufacturing business within other revenues. And now that we may increase over the next years a little bit that business, you know, we basically chose to change representation, split up the sales and COGS. And we also transparently show that actually on page 13 of the condensed financial report in established medicines, you see that the contract manufacturing line, 108 million in quarter four, which is kind of the full year 21, as we decided, you know, in the year that maybe over the next few years, this may increase. So that's why we changed that. It doesn't change the full year number for the company.

I think Richard said is all on Sandoz in terms carry of contract manufacturing.

We have reported.

Relatively small contract manufacturing business within other revenues and.

No.

We may increase over the next year, a little bit that business.

If you chose to change Rep presentation split up to sales of Cogs.

We also transparently show that actually on page 13 of the condensed financial report and established medicines, you'll see under the contract manufacturing line $108 million in quarter, four which is kind of the full year 'twenty one.

We decided in the year that maybe over the next few years. This may increase.

That's why we changed it doesn't change the full year number for the company or changes in the quarter basically by one point on the company into two divisions.

Harry Kirsch: It changes in the quarter, basically by one point on a company and two divisions. And so we will, you will see that as we go forward, you know, how this is developing. And from that standpoint, we thought it's a better representation as we go forward. Thanks, Harry. Thanks, Jerry.

So we will you will see that as we go forward you know how this is developing.

And from that standpoint, we thought is a better representation as we go forward.

Yeah.

Thanks, Larry Thanks, Kerry next question operator.

Harry Kirsch: Next question, please. Thank you. Your next question comes from the line of Kea Parekh from Goldman Sachs. Please go ahead, your line is open. Hi.

Thank you. Your next question comes from the line of <unk> Parekh from Goldman Sachs. Please go ahead. Your line is open.

Kea Parekh: Thank you for taking my questions; please, too, if I may. First, Vas, in your introductory comments, you spoke about your aspiration to be a top three innovator. I was wondering if you might be able to give us some more details around how you define a top three innovator?

Hi, Thank you for taking my questions. Please if I may 1st kind of bass introductory comments you spoke about your aspiration to be our top three innovate, though I was wondering if you might be able to give us some more details around kind of how do you define a top innovator is that in terms of number of new drugs approved is there.

Kea Parekh: Is that in terms of number of new drugs approved? Is that commercial value of the pipeline? Just your thoughts around kind of how you define that. And then secondly, as we look forward to the phase three study readout for Iptacopan, what should be our kind of expectations around the profile for that? Should we be looking at superiority?

Commercial value of the pipeline and industrial parts around kind of how you define that and then secondly, as we look forward to the phase three study readout for the coupon.

It should be our kind of expectations around the profile for that should we be looking at superiority should we be looking at.

Vasant Narasimhan: Should we be looking at something else? Just kind of your confidence around that, and where should our expectations be for that molecule?

So just kind of your confidence around that and what should our expectations be for that molecule. Thank you.

Vasant Narasimhan: On the first one, you know, a few measures on our minds, you know, one is the replacement power and can be a leader and consistent replacement power of our of our sales. I think the placement power and our freshness index are valuable measures of the power of an innovation engine to replace sales within our sector and ultimately to grow the sales of the company. Second, we're very focused on the value per enemy that we are able to deliver words over the last five years have been the leading company and the sector and the number of enemies approved.

Yes, I think here on the first one a few measures on our mind one is the replacement power and can be a leader in consistent replacement power of our of our sales I think replacement power and our freshness index are valuable measures.

<unk>.

The power of an innovation engine to replace sales within our sector and then ultimately to grow the sales of the company.

We're very focused on the value per NME.

To deliver over the last five years have been the leading company in the sector and the number of enemies approved but we'd like to be the leader in the value per NME or peak sales per NME and put it in another way that we're delivering delivering to the market and of course ultimately this all leads to long term long.

Vasant Narasimhan: But we'd like to be the leader in the value per enemy or peak sales per enemy, but in another way that we're delivering delivering to the market. And of course, ultimately, it's all leads to long-term sales growth and our ability to have an innovation engine that can drive that sales growth where we want to consistently be, but I would say replacement power and value per enemy or too high high measures on our minds. And in terms of the phase three profile of the Pakistan John. Yeah, thanks, Kerry.

Term sales growth and our ability to.

And innovation engine that can drive that sales growth, where we want to consistently be but I would say replacement power and value per annum.

Hi, Hi measures on our mind.

In terms of the phase III profile.

With that John .

John: As we look at the Iptecapan and the way that we're looking at the overall profile, obviously, we're looking at the overall unmet needs of the patient. As you know, this is a factor B that is actually targeting the alternative complement pathway. We're looking at both extravascular and intravascular homolysis for PNH in this specific indication.

Yeah. Thanks, Karen.

As we look at the if Pakistan and the way that we're looking at the overall profile. Obviously, we're looking at the overall unmet needs of the patient as you know this is a factor b that.

It is actually targeting the alternative complement pathway, we're looking at both extra vascular and Intravascular hemolysis for <unk>.

<unk> in this specific indication also as we think about the renal indications we're looking at it from the standpoint of reduction in terms of protein area and it could be in a couple of different ways. As we know that these patients have significant unmet need is one that they actually may need something more than what is the current standard.

John: Also, as we think about the renal indications, we're looking at it from the standpoint of reduction in terms of proteinuria. And it could be in a couple of different ways, as we know that these patients have a significant unmet need as one, that they actually may need something more than what's the current standard of care, which is through ACE inhibitors and ARBs. So this could be a combination approach of moving forward.

Of care, which is through <unk>.

Ace inhibitors and arbs. So this could be a combination approach.

Moving forward the second way of looking at this not only in terms of unmet medical need is also the route of administration or in terms of the convenience for the patients as we think about the approach many patients actually are requiring the sub Q administration, which could take up to 60 minutes and having an oral administration twice.

John: The second way of looking at this, not only in terms of unmet medical need, is also the route of administration or in terms of the convenience for the patients. As we think about the approach, many patients actually are requiring the sub-Q administration, which could take up to 60 minutes. And having an oral administration twice a day would be much easier in terms of the approach.

John: And thirdly, is evaluating the safety profile as we look moving forward. And we'll find out more about the safety profile as we read out in our studies. So that's the way that we're looking at Iptecapan overall across the indications for PNH, as well as C3G, IgA, and other renal indications.

Day would be much easier in terms of the approach and thirdly is evaluating the safety profile and as we look moving forward and we'll find out more about the safety profile as we read out in our study. So that's the way that we're looking at in Pakistan overall across the indications for <unk> as well as <unk> IGN other renal indications.

John: Thanks, John. Thanks, Kerr, for the questions. Next question, operator?

Thanks, John Thanks care for the questions next question operator.

Rimal Kapadia: Thank you. Your next question comes from Rimal Kapadia from Bernstein. Please go ahead, your line is open.

Thank you. Your next question comes from Raimo <unk> from Bernstein. Please go ahead. Your line is open.

Vasant Narasimhan: Great, thanks very much for taking my question. So I just want to touch on PSMA. So you have an interesting readout, PSMA for potentially late 2022. How should we be thinking about the incremental efficacy of this current benchmark? and then in particular, how should we be thinking about the pre-taxine setting from a potential perspective? Where's the post-taxine setting?

Great. Thank you very much for taking my question.

I just want to touch on the SMA seven interesting readout PMA for potentially late 2022.

How are we how should we be thinking about the incremental efficacy.

This is Carmen benchmarks and then in particular, how should we be thinking about the pre tax gain sitting from a potential perspective.

Texting setting and then just tied to that the launch of.

From the vision study is it fair to assume <unk> trajectory benchmark or just given prostate is a larger indication the trajectory should look a little bit different with more sustained growth beyond the initial ramp from saturation in Phoenix, we capability. Thank you.

Vasant Narasimhan: And then just tied to that, the launch of, you know, from the vision study, is it fair to assume Luterteva trajectory is a fair benchmark? Or just given prostate is a larger indication, the trajectory should look a little bit different, you know, with more sustained growth beyond the initial ramp from saturation of clinics with capability. Thank you. Yes, thanks, Mamal. So maybe Susanna first on the overall story with the Loopy SMA and the launch of the vision study, and then I'll hand it to John on the specific questions on pre and post-taxing. Susanna?

Yes, thanks for the malls, maybe than a first on the overall story with <unk>.

<unk> SMA and the loss of the business study and then I'll hand, it to John on the specific.

Questions on pre and post Taxane Susanna.

Susanna: Susanna, are you there? Sorry, I was on mute. So, Lutetium PSMA has demonstrated very strong data in the metastatic castration-resistant prostate cancer population, as you know, with significant radiographic PFS and OS. So, we know in this population there's basically no alternative, and Lutetium PSMA has demonstrated superiority versus the standard of care. So, we expect there quite big interest, and we have started managed access programs where we already see quite high demand. So, therefore, when you ask me about the uptake, it will be probably steadily going up. We don't expect a big bonus.

Susanna.

Sorry, I was hoping you could have been worse.

<unk> has demonstrated very strong data in the <unk>.

That's a castration resistant prostate cancer population as you know.

This significant radiographic PFS and OLED so.

In this population there is basically no alternative and and.

<unk> SMA has demonstrated superiority versus the standard of care. So we expect their client base interest and we have started a managed access program, where we already.

High demand. So therefore, when you asked me about the uptake it will be probably steadily going up and we don't expect a big proposal is this first line prostate cancer patients.

Susanna: This is fourth-line prostate cancer patients. But, of course, incidence of prostate cancer is much higher than, for example, neuroendocrine tumors, and therefore, I think we see different dynamics in the uptake. Of course, it's a smaller part. It's the last line of prostate cancer, but we expect continued growth and not like a bolus, and then stability. It's a very different population than GAPNET.

But of course incidence of.

Prostate cancer is much higher than for example in neuroendocrine tumors and therefore, I think we see different dynamics in the uptake of course, it's a smaller part is the last line of prostate cancer, but we expect continued growth and not like a bolus and then stability is that a different population.

And then GAAP net and maybe just a comment before I hand, it to Sean on the setting.

John: And maybe just a comment before I hand over to John on the setting. I mean, the current indication that we have filed for would really be in last line after androgen therapy and taxane chemotherapy, and therefore, of course, with the profile that we see on Lutetium PSMA, we would aim to go earlier. And certainly, the pre-taxane setting is one of the settings that is significantly bigger than what we have filed for in the current indication.

The current indication that you have high probe would really be and last line after androgen perhaps.

And that's exciting.

Chemo therapy and for of course, the profile that we see on the <unk> piece it may.

Was aimed earlier so it could be the <unk> setting is one of the settings.

Difficultly Baker.

John: So, with that, John, maybe over to you, maybe a few words on PSMA-4. Sure, happy to talk about PSMA-4. Maybe to start off, just to think about prostate cancer. As we know, 80% of prostate cancers actually express PSMA.

What we have filed for in the current indication so with that Sean maybe over to you maybe a few words on PSA may four.

Sure happy to talk about the SMA for maybe just start off just to think about prostate cancer as we know 80% of prostate cancer is actually express <unk>. So that's a starting point and the pathophysiology what we saw in the third line as Susanna expressed and as we saw that we had 38%.

John: So that's a starting point in the pathophysiology. What we saw in the third line, as Susanna expressed, is we saw that we had 38% improvement in overall survival and 60% in terms of radiographic progression-free survival as well as combination of OS. That is the starting point. We know that there are a number of patients that are in need of additional treatments, whether that's in the pre-taxane setting or in the first-line setting, especially given the toxicity of the taxanes in chemotherapy. And what we know is radioligand therapy has less adverse events than compared to chemotherapy.

Improvement in overall survival and 60% in terms of radiographic PFS.

Radiographic progression free survival as well as combination of OS that is the starting point, we know that there are a number of patients that are in need of additional treatments, whether that's in the pre taxane setting or in the first line setting, especially given the toxicity of the Taxane chemotherapy and what we know is radio.

<unk> therapy has less.

Adverse events then.

Compared to chemotherapy. So we've already started recruitment in the pre Taxane study and are hoping to read out before the end of the year for the second line treatment and then we're also looking at first line treatment in terms of hormone sensitive population in that study is also advancing.

John: So we've already started recruitment in the pre-taxane study, and we're hoping to read out before the end of the year for the second-line treatment. And then we're also looking at first-line treatment in terms of hormone-sensitive population, and that study is also advancing. And in addition to those studies, we're also looking at studies in terms of patients who have not had metastases in terms of prostate cancer.

In addition to those studies, we're also looking at studies in terms of.

Patients who have not had metastases in terms of prostate cancer. So I think this is going to be a very broad program as we move forward.

John: So I think this is gonna be a very broad program as we move forward for the tissue. Great. Thank you, John. Thank you, Amal. So we have still quite a few people in the queue. So if we could try to limit ourselves to one question, we'll try to get to as many questions as possible. Next question, operator.

Tissue empty SMA.

Great. Thank you John .

So we have quite a few people in the queue. So if we could try to limit ourselves to one question, we'll try to get to as many questions as possible next question operator.

Matt Weston: Thank you. Your next question comes from the line of Matt Weston from Credit Suisse. Please go ahead, your line is open.

Thank you. Your next question comes from the line of Matt Weston from Credit Suisse. Please go ahead. Your line is open.

Vasant Narasimhan: Thank you. My question's on Ensovipep. And Harry or Vas, I'd be very interested to understand how you've integrated it into guidance. I can see from your slides that you've given it a billion, $1 Unprobability Adjusted Peak Sales Potential. And obviously, if you're able to achieve regulatory emergency use authorization.

Thank you my question is on and solve it Pat how are you vas I'd be very interested to understand how you've integrated it into guidance I can see from your slides that you've given it's a billion.

Darla Unprofitability adjust peak sales potential and obviously, if you are able to achieve regulatory emergency use authorization.

Vasant Narasimhan: We could see significant bolus orders. And so I'd love to know what you've taken into account when you set the guidance for 2022. Thank you. Yeah, thank you, Matthew.

We could see significant bolus orders and.

And so I'd love to know.

You've taken into account when you set guidance for 2022.

Thank you.

Vasant Narasimhan: So we've not included in ZOVI-BEP in our guidance, any of the guidance that we've provided today. I think as we understand better, as we move through the emergency use authorization application and review process, ultimately understand the FDA's decision, and then the potential contracting we would have with the US as well as other interested parties around the world. We've had discussions with a number of other governments around the world around the medicines, but I would say most of those governments have centered their view on how the FDA ultimately views the EUA application if they were going to make emergency orders.

Yes, Thank you Matthew and I can take that so we have not included in our guidance any of the guidance that we've provided today.

I think as we understand better as we move through the emergency use authorization application and review process.

Ultimately I understand the Fda's decision and then the potential contracting we would have with the U S as well as other.

Interested parties around the world, we've had discussions with a number of other governments around the world around the medicine, but I would say most of those governments have centered their view on how the FDA ultimately abuse EUA application. If they were going to make a emergency orders. So we think it's prudent right now not to include it in there.

Vasant Narasimhan: So we think it's prudent right now not to include it. And then once we understand the dynamics better over the course of Q1, we hope, or into Q2, we would then update according, Thank you. Thank you, Matthew. Thank you, Matthew. Next question, operator.

Once we understand the.

The dynamics better over the course of Q1, we hope or into Q2, we would then update accordingly.

Okay.

Thank you great. Thank you Matt. Thank you Mathieu next question operator.

Richard Vosser: Thank you. Your next question comes from the line of Richard Vosser from JP Morgan. Please go ahead, your line is open.

Thank you. Your next question comes from the line of Richard Vasa from Jpmorgan. Please go ahead. Your line is open.

Vasant Narasimhan: Hi, thanks for taking my question. So just a question on price pressure from ex-US governments, etc. I mean, they've been pretty hit by COVID and COVID expenses.

Hi, Thanks for taking my question. So just a question on price pressure.

Ex U S.

Vasant Narasimhan: After the great financial crisis, we saw some increased pressure on drug prices. You know, are we going to see something like that? Are there any murmurings from governments on pricing pressure generally?

<unk> et cetera, I mean, they've been pretty hit by Covid and Covid expenses.

After the great financial crisis, we saw some increased pressure on drug prices.

Are we going to see something like that are there any learnings from governments on pricing pressure generally.

Thanks very much.

Vasant Narasimhan: Thanks very much. Well, I can start and say, as far as my discussions have gone on with various health officials in Europe, not heard an increased focus or a shift in terms of the support for innovative medicines and enabling medicines that broad access or improved access certainly that's a priority for President Macron and his European Commission presidency but maybe Marie Frantz do you have any thoughts or insights? Yeah, I mean, I just think in general, we always have to be prepared.

Well I can start into as far as my discussions.

Gone on with various health officials in Europe .

<unk> heard an increased focus or a shift in terms of the support for innovative medicines, and enabling medicines that broad access or improved access.

Certainly that's a priority for president Macron and as European Commission presidency, but maybe very front do you have any thoughts or insights on it.

Vasant Narasimhan: I mean, we do we do we do more and more have to make the case. Or we see limitations on reimbursement, in terms of line of therapy, etc, etc. You know, obviously, we have a lot of experience, and we're very used to that in the European landscape.

Yes, I mean, I just think in general.

We always have to be prepared I mean, we do we do we do more and more have to make the case.

Or we see limitations on reimbursement.

In terms of line of therapy et cetera, et cetera, obviously, we have a lot of experience and we're very used to that in the European landscape.

And you see.

A lot of tough negotiations happening in China.

I'd say its a little bit.

Marie-France Tschudin: You see a lot of tough negotiations happening in China. So I would say it's a little bit almost like the ticket to entry is making sure that the value of our products is recognized, that we're focused on value based pricing, which I think is something that Novartis has been, you know, very diligent about, and making sure that access is really top of mind on any strategy when it comes to product launch or, or making sure that more patients can can reach products faster. Perfect. Thanks for that. Thank you, Richard. Next question, operator.

Almost like the ticket to entry is making sure that the value of our products is recognize that we're focused on value based pricing, which I think is something that novartis has been.

Very diligent about and making sure that access is really top of mind on any strategy. When it comes to product launch or we're making sure that more patients can reach products faster.

Perfect. Thanks, perfect. Thank you Richard next question operator.

Vasant Narasimhan: Thank you. Your next question comes from the line of Emmanuel Papadakis from Deutsche Bank. Please go ahead, your line is open.

Thank you. Your next question comes from the line of Emmanuel Papadakis.

<unk> from Deutsche Bank. Please go ahead your line is open.

Emmanuel Papadakis: Thank you for taking the question. Maybe I'll take one on Ayaan Al-Ahmad and Shogun to make the decision to... Progress in Phase 3, I guess a question around design and timing, published data that looked, I would say, better in, Patients with less advanced disease. So have you reached any decisions, excuse me, yet about the phase three design? And what breadth of enrolment is that likely to include in terms of the patient population and therefore what?

Thank you for taking the question, maybe I'll take one on Allomap and cycling amongst the decision too.

Congrats since phase III.

Hi, guys question around design and timing.

Published data.

I would say better in paint.

Patients with less advanced disease have you received.

Decisions excuse me yet about the phase III design.

Hi.

Enrollment is that likely to include in terms of the patient population and therefore.

Emmanuel Papadakis: The proportion of the Sjogren's population, which is pretty large, that phase 3 trial might apply to. And then just in terms of timing, you told us that the R&D day 2026 was the likely timing for a potential phase three readout. Is there any way that could be accelerated, for example, on interim?

And of the size of this population just pretty launch that might not phase III 12 months guarantee.

And then just in terms of timing.

Told us.

R&D to a 2026 was the likely timing for potential phase III is there any way that could be accelerated for example, an interim.

Vasant Narasimhan: Soergel got the biomarker data, since that would imply a pretty long phase 3 timeline. Thank you. Thank you, Emmanuel, all very good questions.

So that a biomarker data.

That would imply a pretty long.

Thanks for your time and thank you.

John: John on IMLMAB Phase 3 design for show, Yeah, as we think about Emmanuel then, as Voss said earlier, we're excited about a number of indications in showroom syndrome, Lupus Nephritis, and SLE. Specifically, as you ask about showroom syndrome, as you know, we've advanced based on results that we've seen from our phase two study. These are patients who actually have had high esti scores.

Thank you all very good questions John .

I know in the phase III design for children.

Yeah. So when you think about <unk> and as Bob said earlier, we're excited about a number of indications and.

In Shogun syndrome, lupus nephritis, and SLE, specifically as you asked about Shogun syndrome. As you know we've advanced based on results that we've seen from our phase. Two study. These are patients who actually have had high <unk> scores and thats. The specific population that we're targeting moving forward.

John: And that's the specific population that we're targeting moving forward in this population. We are going to start recruiting patients in the second half of this year. In terms of advancing, I think the balance here is the largest showroom syndrome phase three study that's been conducted actually. I should say the largest study not phase three, the largest study that's been conducted has been conducted by us.

In this population.

We are going to start recruiting patients in the second half of this year in terms of advancing I think the balance here is the largest sjogren syndrome phase III study that's been conducted actually.

John: And we want to ensure that there's consistency in terms of these patients that we're recruiting because showrooms is a very diverse population of patients. We've guided the results in 2026, and we will update as we find the patients and how recruitment goes, but we are using strict criteria for inclusion to ensure that we get the best results moving forward. Currently, we are expecting results. I mean, I think one of the dynamics I've learned is how important it is to have well-trained sensors here that really ensure that they apply the SDI and some of the other measures in a consistent way.

I should say the largest study not phase III. The largest study that's been conducted has been conducted by us and we want to ensure that there is consistency in terms of these patient recruiting because <unk> is a very diverse population of patients. We guided the results in 2026, and we will update as we.

Find the patients and how recruitment goes but we are using strict criteria for inclusion to ensure that we get the best results moving forward. Currently we are expecting results from 2006.

I mean, I think one of the dynamics I've learned is how important it is to have well trained centers here that really ensure that they apply the ESI and some of the other measures.

So I think we want to be appropriately cautious on our timeline.

Vasant Narasimhan: So I think we want to be appropriately cautious on our timeline. And then, of course, as we learn more, as John said, we'll provide updates on Ionilumab across all of the indications as we take it forward. Thanks, Emmanuel. Next question, operator.

And then of course as we learn more as John said, we'll provide updates on iron ore that across all of the indications that we can take it forward.

Thanks, Daniel next question operator, thank you.

Mark Purcell: Thank you. Your next question comes from the line of Mark Purcell from Morgan Stanley. Please go ahead, your line is open.

Your next question comes from the line of Mark Purcell from Morgan Stanley . Please go ahead. Your line is open.

Marie-France Tschudin: Yeah, thanks for taking my question. Entresto China, can you help us understand the size of the opportunity and hypertension, but when the LOE timing is going to kick in? And on the basis of that, you know, the pivot opportunity is the retail pharmacy setting to maintain your momentum in China. And just to quickly, Vaz, in terms of a clarification, in terms of the Sandoz considerations for counterparties, what should we expect next in terms of biosimilar data? And what are the key LOE launches coming up in 2023 and beyond?

Yes. Thanks for taking my question interest, though China can you help us understand the size the opportunity in hypertension, but when the timing is going to kick in on the basis of the pivot opportunities since the retail pharmacy setting to maintain your momentum in China and then just quickly for us in terms of clarification in terms of the sandoz considerations for Counterparties.

What should we would expect next in terms of Biosimilar data what are the key launches coming up in 'twenty three and beyond.

Marie-France Tschudin: Yeah, absolutely, Mark. So first, on the interest of time, I'm very proud. Yeah, so the the opportunity certainly from a volume perspective is significant, right? So we're moving the population from seven to eight million heart failure patients to about 240 hypertension patients. And as I said before, in my comments, hypertensive patients in China are really not well controlled.

Yeah, absolutely Mark So first on Entresto, China Marie France.

Yeah. So.

The the opportunity certainly from a volume perspective, the significant right. So we're moving the population from seven to 8 million heart failure patients to about 240 hypertension patients and as I said before in my comments.

Hypertensive patients in China are really not well control. So there is a big opportunity. Obviously, there was a significant price concession as we listed in RTL, but we do think that is a worthwhile.

Marie-France Tschudin: So there is a big opportunity. Obviously, there was a significant price concession as we listed NRDL. But we do think that it is a worthwhile proposition, just because there's an opportunity to just expand to such a broad, broad population of patients. So we are we have broadened our footprint as well. We're making the necessary investments. We also want to make sure that that we have the right digital tools in place.

Proposition just because there is an opportunity to just expand to such a broad broad population of patients. So we are we have broadened our footprint as well, we're making the necessary investments.

Marie-France Tschudin: As you know, we have a cooperation with Tencent, where we're looking at, of course, interest though independent, but looking at making sure that that that heart failure patients can be more in control of their own monitoring. So there are a lot of activities in this space. As you know, in China, CVD is a major, you know, cardiovascular disease is a major problem with with massive costs. And when it comes to the the patent situation in China, China is hard to give a definitive answer.

Also wanted to make sure that.

We have the right digital tools in place as you know we have a cooperation with Tencent where.

We're looking at of course interest are independent, but looking at making sure that that heart failure patients can be more in control of their own monitoring. So there are a lot of activities in the space as you know in China CBD is a major.

<unk>.

Cardiovascular disease is a major problem with that with massive cost.

When it comes to.

On the.

Patent situation.

In China, China is hard to give a definitive answer we are obviously working to.

Marie-France Tschudin: We are obviously working to secure RDP in China. And I think that's, you know, an industry wide initiative. So there are some question marks around until when and certainly couldn't give you guidance on that here today. But the the opportunity is significant.

Secure RTP in China, and I think Thats, an industry wide initiative.

So there are some question marks around.

<unk> and then certainly Couldnt give you guidance on that here today.

Marie-France Tschudin: We're thrilled about it. This was, as we said, you know, a potential upside for us, and could could be up to about a third of our, let's say, growth and interest though for this year. Thanks very much. And then on Sandoz Biosimilars upcoming launches, Thank you, Baz. Really, the next launch is already at Illumab, and that's Illumab coming in, I guess, late 23 into 24.

But the opportunity is significant we're thrilled about it this was as we said at <unk>.

Potential upside for us and could could be up to about a third of our let's say growth in entresto for this year.

Thanks, Brian and then on Sandoz Biosimilars upcoming launches Richard.

Thanks Pat.

The next launches already Adelina map and not dilutive amount coming in I guess late 'twenty three into 2012.

I think I commented earlier Thats really the start of the next wave.

And that should start accelerating both our topline and clearly the margin expansion from the business and we'll update as we file and move those products forward.

Richard: So I think I commented earlier that that's really the start of the next wave of biosimilars that should start accelerating both our top line and clearly the margin expansion from the business. And we'll update as we file and move those products forward. Thanks, Mark. Thanks, Richard.

Thanks, Mark Thanks, Richard Thanks, Marc I think we have time for any more we have in the queue operator, let's take the next question and we'll keep going till the.

Net.

Admittedly our.

Richard: Thank you, Mark. I think we have time for not many more we have in the queue, but Aubrey, let's take the next question and we'll keep going till the mid of the hour. Thank you. Your next question comes from the line of Florent Cespedes from Societe Generale. Please go ahead. Your line is open. Good afternoon.

Thank you. Your next question comes from the line of Florent Cespedes from Society Generali. Please go ahead. Your line is open.

Florent Cespedes: Thank you very much for taking my question. A quick follow-up on China, please. Could you please elaborate on beyond interest or which are the growth drivers there and potential risk and how you see the momentum in China? Thank you. Mary France, you want to take that on pharma China?

Good afternoon, and thank you very much for taking my question.

Follow up on China. Please could you please.

Please elaborate on be on Entresto, which further growth drivers there and potential risks you see to the momentum in China. Thank you.

Marie France, you want to take that on a farm a tunnel.

Marie-France Tschudin: Yeah, so we've got three main growth drivers for the pharma business in China, Cosentix, Intresto, and Lucentis. And all three products are showing strong growth. I mean, as we mentioned before, they were all affected in Q4. But Q4 is also normally the lowest quarter in the year for us.

Yes, so we've got three.

The main growth drivers for the pharma business in China.

Entresto in the center.

And all three products, our strong showing strong growth I mean, as we mentioned before they were hall effect that in Q4, but Q4 is also normally the lowest quarter in the year for us. So we talked about the budget constraints for <unk>, we've seen the rebound in Q1 for Entresto <unk> thing in this.

Marie-France Tschudin: So we talked about the budget constraints for Cosentix. We've seen the rebound in Q1 for Intresto, the NRDL listing, and the stock compensation, and Lucentis was due to COVID lockdowns. You know, the one thing I'll say about China is that going forward and giving the fact that the country is now so open to innovation, we are now thinking about China as we think about any other country.

Stock compensation incentives with due to Covid lockdowns.

Yeah. The one thing I'll say about China is that going forward and giving given the fact that the.

The country is now so open to innovation.

We are now thinking about China, as we think about any other country. So when we look forward.

At our portfolio, whether that's <unk>.

We just received the launch of our the approval for <unk>, we are thinking about our portfolio in China in the same way as we're thinking about our portfolio in the U S and Europe . So going forward. That's what you can expect the three growth drivers maybe the big exception is lucentis, which continues to be a strong growth driver for us.

Marie-France Tschudin: So when we look forward at our portfolio, whether that's Lecvio, we just received or the approval for Cosentix, we are thinking about our portfolio in China in the same way as we're thinking about our portfolio in the US and Europe. So going forward, that's what you can expect. The three growth drivers, maybe the big exception is Lucentis, which continues to be a strong growth driver for us in China.

Marie-France Tschudin: And that's where the focus is, that's where we're investing, and that's where our footprint is working. Thank you very much. The next we'll go to I think we have two more first time questions.

And in China, and that's where the focus is that's where we're investing and thats, where our footprint is is working.

Thank you very much.

Brian .

Next we'll go to I think we have two more first time questions next question operator.

Peter Welford: Next question. Thank you. Your next question comes from Peter Welford from Jeffreys. Please go ahead, your line is open.

Thank you. Your next question comes from Peter Welford from Jefferies. Please go ahead. Your line is open.

Harry Kirsch: Hi, thanks for screening me in. It's one for Harry really, the Outlook for Innovative Medicines. The Outlook for the Core Operating Income, mid to high single digits, is slightly above sales growth. Obviously, this year, you started similar, but you delivered close to 10%.

Hi, Thanks for squeezing me in I, just want to hurry Randy the outlook for innovative medicines the outlook for the core operating income mid to high single digit is it slightly above sales growth. Obviously this year you saw some of that that you delivered close to.

Harry Kirsch: When you can talk a little bit about what we should be thinking about the greater investments, I guess, you're making this year, that if you like, constrain perhaps the margin expansion versus the benefit we saw in 2021, the result in that mid to high single digit growth, or is it just conservatism on your part? Thank you. Thank you, Peter. So, of course, always a fine balance, right? As we know, in pharma companies, one can get almost any kind of core margin one would like to have, but it's always this very delicate balance between investing and also driving, of course, productivity, as we do.

10% when you can talk a little bit about what we should be thinking about the ratio of investments I guess youre, making this year. If you like constrained perhaps the margin expansion versus the benefit we saw in 'twenty. One the results in that mid to high single digit growth or is it just conservatism on your part thank you.

Thanks, Peter and Gerry there, yes, thank you Peter.

Of course always a fine balance right as we know in pharma companies, one can get almost any kind of.

Core margin one would you like to have but it always does.

The delicate balance between investing.

Also driving cost productivity as we do.

Harry Kirsch: And so overall, we have made significant strides on the core margin improvement, as Lars shared in one of his earlier charts, 180 basis points in 2019, 220 basis points in 2020, and then 130 basis points last year. And part of that was also some restricted investments, if you will, due to the pandemic situation.

So overall, we have made significant strides on the core margin improvement as loss share in one of his earlier charts. So 180 basis points to 19 220 basis points in 'twenty, and then 130 basis points last year and part of that was ultra some restricted.

Investments, if you will choose a pandemic situation.

Harry Kirsch: So we always ensure that we invest appropriately in the R&D line, certainly. And we have to ensure that the launches are getting very well supported. And we have fantastic launches that Marie-Françoise and her teams and their teams are driving. So I would expect each of the next years in innovative medicines some good marginal improvement, but of course not to the level we have seen over the last two, three years.

So we always ensure that we invest appropriately in the R&D line, certainly and we have to ensure that the launches are getting very very supportive and we have fantastic launches that some other forms of sandler and her teams.

<unk> are driving so.

I would expect Egypt next year's in innovative medicines, some good margin improvement, but of course not to the level. We have seen over the last two or three years. So it's a balance and the investments are clearly the pipeline to launches. Thank you.

Harry Kirsch: So it's a balance, and the investments are clear in the pipeline and the launches. Thanks, Terry. And then we will have time; thanks, Peter. Last question, Operator.

Thanks, Terry and then we have time, thanks, Peter last question operator.

Operator: Thank you. Your last question today comes from the line of Seamus Fernandez from Guggenheim. Please go ahead, your line is open.

Thank you. Your last question today comes from the line of Seamus Fernandez from Guggenheim. Please go ahead. Your line is open.

Seamus Fernandez: Oh, great. Thanks for the question. So I just wanted a couple of pipeline questions very quickly, just in terms of the differentiation. What makes inalienimab, you know, unique from other APL-BAF compounds that have failed in similar type indications, particularly in lupus? I think we've seen a number of challenges there.

Great. Thanks for the question. So just wanted to a couple of pipeline questions very quickly just in terms of the differentiation what makes <unk> mab.

<unk> from other April Bath compounds that have failed in similar type indications, particularly in lupus I think we've seen a number of challenges there and then just separately on legalism app versus Remy brute nib in CSU can you just help us understand the decision points.

John: And then just separately on ligalizumab versus remibrutinib and CSU, can you just help us understand the decision points, you know, as it relates to ligalizumab for filing? And then, you know, how, if you do launch there, you'll trade off your expectations for remibrutinib in a similar setting. Thanks. Yeah, I think, John, if you're still there, you want to take the Ion-Nanomab question?

As it relates to <unk>.

For filing and then how.

If you do launch their trade off your expectations for <unk> in a similar setting thanks.

Yes, I think.

John are you still there or do you want to take that.

John: Sure, absolutely. And thanks for the question, Seamus. As we look at Ion-Nanomab, you know, this is our anti-bath agent, and we really see two different modes of action with Nanomab.

A question sure absolutely.

Thanks for the question Seamus as we look at <unk>. This is our anti Bath age and we really see two different modes of action with manual map. It's a direct license of B cells by ADC is one path and the other is math receptor blockade that interrupts the math mediated signaling for.

B cell maturation proliferation and survival. So the difference here is there are dual modes of.

John: It's a direct lysis of B cells by ADCC as one path, and the other is bath receptor block A that interrupts the bath-mediated signaling for B cell maturation proliferation. And survival. So the difference here is there are dual modes of mechanisms of action versus what has been seen with previous bath receptor blockers. And what we've seen is actually this counterbalance of the two mechanisms that allows us to see, and we've actually seen good responses, as we said earlier, in our Phase II studies, and that's why we're moving forward in these various indications.

Mechanisms of action versus what has been seen with previous math receptor blockers and what we've seen is actually this counterbalance of the two mechanisms that allows us to see and we've actually seen good responses as we said earlier in our phase III studies and Thats why were moving forward in these various.

John: On your second question, I think in terms of go ahead, go ahead. I was just going to chime in on, I think some of the competitor historical molecules only targeted the Baff ligand and only certain subtypes of the Baff ligand, so not completely comparable to previous results. Go ahead, John and Remy Bruton. Yeah, so in terms of looking at remibrutinib versus ligalizumab, as we look at both combinations, we've seen good results in both.

<unk>.

On your second question I think in terms of the go ahead to drive us.

I was just going to chime in on that.

I think some of the competitor of historical molecule is only targeted about ligand and there will be certain subtypes of the backlog and some not completely comparable to previous results go ahead, John on roaming agreement.

John: And as you know, for remibrutinib, for the VTK selective oral inhibitor, what we've seen is also good results in CSU with an oral compound. So as we're moving forward, we're looking at both approaches, and we'll make decisions as we further analyze the results from ligalizumab.

Yes, so in terms of looking at Remy Britain versus legalism App as we look at both combinations we've seen good results in both.

And as for Remy Britain.

BT case selective oral inhibitor. What we've seen is also good results in CSU with an oral compound. So as we're moving forward. We're looking at both approaches and we'll make decisions as we further analyzed the results from <unk> and then as we move forward with Remy Bruton.

John: And then as we move forward with remibrutinib, we'll continue recruitment in the, And I think Seamus' idea of this legalism, I guess the question, is there value in getting the medicine on the market? I have the potential future launches in food allergy and fin-do, or is that not a sensible strategic approach? And we just haven't come to a determination yet. Our current view is that we, with the superiority, the placebo, it is potentially filable and, of course, a review issue with the FDA.

Recruitment in the studies.

And I think Seamus the idea, but legal isn't I guess the question is there value in getting the medicine on the market ahead of us.

Potential future launches in food allergy.

Or is that not.

Sensible strategic approach and we just haven't come to a determination yet.

Our current view is that will be with the superiority to placebo. It is potentially violable and of course, we review issue with the FDA. So we're going to make those assessments carefully and then decide what the right approaches.

Okay.

Vasant Narasimhan: So we're going to make those assessments carefully and then decide what the right Very good. So thanks, everyone, for joining today's conference call. We hope it was helpful to get a perspective on both the near term, but also the longer term outlook in the company, the pipeline, the products and the things we're excited about. We're excited about delivering a strong 2022. And we'll look forward to keeping you up to date through various interactions.

Very good to thank everyone for joining today's conference call. We hope it was helpful to get a perspective on both the near term, but also the longer term outlook for the company the pipeline the product and the things. We're excited about we're excited about delivering a strong 2022.

And we will look forward to keeping you up to date through various interactions and then of course in our next quarterly conference call. We wish you a great year and we will look forward to speaking to you soon thank you.

Operator: And then of course, at our next quarterly conference call, we wish you a great year, and we'll look forward to speaking to you soon. Thank, Thank you. That does conclude today's conference call. Thank you for participating. You may all disconnect.

Thank you that does conclude today's conference call. Thank you for participating you may all disconnect.

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