Q2 2022 Sanofi SA Earnings Call
Bottom up your screen or option to submit your questions by clicking the Q&A icon at the White house asleep and with that I'd like to turn the call over it.
Well, thank you Emma and thanks, everyone for joining.
I'm truly delighted to show our outstanding financial results with you today and as always with me here in the room on the key members of the executive team to take you through our business and financial performance.
We delivered sales growth of eight point.
1% continuing the strong performance we saw in Q1.
Both in specialty can have accelerated to more than 21%.
Do you think some posted nearly 2 billion euros and fails and it's still growing and his fellow rate above 40% already of these franchise has grown double digits driven by legacy products and recent approvals.
Continued growth in Ppas for the recovery in travel and booster vaccines drove another strong quarter for our vaccines business.
In general medicines, the focus put on our core assets well it continues to pay off consumer health care delivered another quarter of above market sales growth and this speaks volumes about the speed at which our business is transforming into a truly agile fast moving and consumer centric organization.
Moving to slide seven let's take a moment to consider the immense potential of to pick some.
Five years into launch this medicine continues to grow at a remarkable pace.
We have already treated over 450000 patients worldwide, we never it certainly wouldnt starting at this point the markets, where we have proved is still largely underpenetrated with ineligible population of around 7 billion patients. This quarter alone. We added 150000 eligible patients. Thanks, so approvals in the area.
Is a high unmet need such as pediatric asthma in Europe , and eosinophilic esophagitis in the U S.
Let me mention here the approval we received in the United States for the youngest children suffering from atopic dermatitis, making to fix in the first and only biologic medicine approved in all age groups and consistency to Ottawa, That's a complete paradigm shift the breadth and depth of the depiction label setting aside this mega Brad.
All other medicines in this area.
On slide eight as we get closer to the end of the first phase of our six year strategic plan, let's take a moment to highlight some of our achievements and future perspectives.
We delivered eight consecutive quarters of sales growth more recently growth even accelerated to high single digits.
At least the decades in such a performance was achieved.
If a whole it is a proof point that our focus on winning assets combined with strong commercial execution is clearly paying off.
At the same time, our profitability improved and thanks to the efficiencies and savings made across the company. We are making these improvements are sustainable by largely reinvested in our growth drivers and our science and as a result, we remain on track to retail 30% Oi margin guidance. This year as we had committed back in 2000.
19.
We are on a quest to modernize the company, there's modernization inducing deep cultural transformation, but also important structural changes.
Recent and successful spin out of Euro API is a major milestone and some of the implementation of a C suite Standalone model.
Looking ahead several key factors will be instrumental cross strategic execution, clearly depicts and remains the number one driver of our growth story it will help to manage the low.
So in the U S in 2023.
Less meaningful.
In this decade.
Sanofi pharma stock with the least exposed to generic competition amongst our peer group.
We will continue to focus on our R&D productivity to increase investment in breakthrough science, and first and best in class assets.
Pipeline is matured fast and we will have multiple chances for transformative launches in the upcoming years.
The short term.
<unk> focused on making the seven months of success.
It's a story by achieving all in for protection from RSP, starting next year.
Following shortly after we strongly believe is going to start to talk alpha will have the potential to revolutionize treatment for hemophilia a patients.
Our belief and tolerated oral brain penetrant <unk> inhibitor is to address the full spectrum of multiple sclerosis remains waiver based on compelling phase II efficacy data, we launched the largest phase III clinical program in MFS and more than 2000 patients currently Entente ibrutinib therapy with <unk>.
<unk> of treatment up to three years.
We expect the first pivotal readout by the end of next year.
It's disappointing that the FDA asked us to pause new patient enrollment in the U S without accessing the impact of our trial protocol revisions implemented back in May Let me point out that all of the 150 patients enrolled into the phase III program.
Implementation of the revised protocol Tonight on the partial clinical hold in the U S. At the end of June no.
Any sign of drug induced liver injury.
We received the written feedback from the FDA and our confidence to address the Fda's request for additional information by the end of this quarter. Meanwhile, the studies continue in dozens of countries around the world.
Moving to slide nine, let's take a closer look at our R&D transformation.
Clear prioritization and long term ambition to lead with innovation. This.
This slide illustrates just a few examples of the significant shifted R&D productivity. We've made over the past few years, such as accelerating the development of new pixel across a wide range of truck to a commentary diseases and building an industry, leading immunology pipeline.
I simply could not be proud of the organization and the progress we've made over the past couple of years.
Moving to slide 10, and our hemophilia pipeline.
You had the chance to follow I S. T exits with the pivotal data for Fr. Alpha was presented earlier. This month you will almost certainly agree.
And it's tough to call. The alpha is reaching levels of efficacy that have simply never been seen before.
There was little reason in my view, so patients that are using factor today.
Anything other than fr.
Alpha in the future and Bill will take a little more talk little more about this on the upcoming launch in a few minutes.
And then another fact became apparent to me when I had the chance to engage with key opinion leaders I S. T. H beyond effect innovative hemophilia treatments have to be truly once monthly or even less frequently.
So, let's not forget the potential for <unk>, we look forward to presenting more data from the upcoming sorry ongoing into two strong program next year based on a revised schedule of every other month.
Moving on to slide 11 in the southern part of team is working around the clock to make this first in class immunization solution available to protect all infants against RSV. Once approved RFP was recently on the agenda of the general meeting of the U S Advisory Committee on immunization practices Ace it and recognized as the.
The most common cause of hospitalization in U S with extra results of the pivotal trials in the southern market is positioned to play a central role in achieving the crazy needed all in for protection against RSV.
I've asked him to slide 12, you remember that we accepted the challenge of COVID-19 efficacy study at a time when many people had already been infected or starting to get vaccinated joined the first campaign yet.
But on the bus, but we knew the recombinant protein platform was not built for speed. However, it allowed us to include a vaccine based on our parents since the phase III study and to test for efficacy and then Amit from well results were published recently beta containing vaccine clearly underlining the strength of our science and upper a combo.
The platform by visa well because it allows for a broad cross protection across a number of very interesting sun as.
As we said many times this is not a financial play for us.
Profile of a recombinant booster vaccine makes it an interesting solution.
The efficacy and the safety.
Well its authorized a recombinant booster could play a meaningful role.
So let me close on slide 13, with the recent progress of our CSR strategy, we launched the Sanofi Google Health in April 2021 during the pandemic and it is clearly picking up pace and that the model of Sanofi Global hub is simply unique it is the first and only global initiatives to provide the access to medicines.
Medicines in 70 countries and across so many areas using its own brands.
We presented our ESG ambitions at a dedicated investor events over the smiled and said I think that will help was recognized as a flagship initiatives by attendees.
Our events as well as by the leading ESG rating agencies.
To sum up so as you can see our scientific and commercial agenda is moving at speed and so is our commitment to society I'm very proud of all the progress made with that I hand over to bill for his update.
To get there.
Well, thank you Paul moving to specialty care I'm excited to discuss the stellar performance in Q2 were all franchises as you can see our growing sales exceeded 4 billion euros, making specialty care centipedes biggest GPU in the quarter growing at almost 22%.
This quarter the core driver of performance was once again do pick sent with its outstanding sales across geographies in approved indications and the recent addition of BOE in the U S.
Rare disease emerge with double digit growth in the quarter driven primarily by continued patient accruals. In addition to favorable phasing which are typical for this business overall throughout the year. However, we do not change our long standing trajectory of mid single digit growth for this attractive franchise in oncology our launch momentum.
Continues for sure closer as we look forward to the additional potential growth opportunity in first line based on the <unk> pivotal data readout later this year.
Going to slide 16, let's take a closer look at the pixel performance in Q2, where we see a meaningful step up in sales from Q1 2022.
Depicted on the graph on the left.
With the growth rate almost 40% compared to Q2 2021, we see the published sales that youre benefiting from a continued increase in underlying demand and the stronger U S. Dollar. These.
These effects together have added 720 million euros and incremental sales versus Q2 2021.
As Paul highlighted already in Q2 alone we added 150000 eligible patients and expanded into Gi with the approval of eosinophil like Esophagitis, where do Pixar is the first and only medicine indicated to treat the disease.
Additionally, progress has been made to address the need in the pediatric population, where the well established safety profile and be picks and is an important differentiator.
Turning to slide 17, you can see we now have five positive pivotal trial readouts in the pediatric population substantially increasing the number of eligible patients for big Pixar. This achievement is based on a robust and ever growing safety database across type two inflammatory diseases, where sanofi and regeneron.
<unk> continued to generate a compelling body of safety and efficacy evidenced compared to new market entrants. We believe this further elevate <unk> profile to be the preferred treatment choice with physicians payers and patients.
Shifting focus to another leading franchise, where blood disorders, we presented two late breakers at R.
On our priority assets ethane to surrender at the I S. T. H conference earlier this month.
While closely engaging with the members of the hemophilia community community.
And specifically the physician experts in the field, we highlighted the strong scientific evidence for our innovative hemophilia treatments with their potential to raise the bar for both efficacy and treatment burden.
We have highlighted the key data for Alfa on this slide looking first at the primary and key secondary endpoints. The primary endpoint was met as the median ABR with zero with an inter quartile range of zero to 1.0 for using a model based mean, the AVR with 0.71.
These impressive data do not come as a surprise to investigators, but rather fulfilling the expectation to be a highly efficacious treatments.
The key secondary endpoint depicted on the right compared the intra patient ABR between prior factor eight prophylaxis and ethnic prophylaxis. The mean ABR for the prior factor eight prophylaxis and the patients that participated in the pre study was 296 without the prophylaxis. However, the mean.
ABR with 0.69, an impressive 77% decrease in the mean.
And then half of the number of infusions that they were doing on their prior prophylaxis. Ultimately F offers a significant decrease in patient treatment burden with strong levels of protection and lower mean ABR.
Based on the data we see FY is creating a new class. We believe this is a high efficacy class offering superior efficacy above any product that there has and there has been in hemophilia, a and anything that we see in development near normal factor levels for the majority of the week and two.
Drew once weekly dosing this new standard of possibility I would call. It is just starting to be appreciated and opens up at about two 5 billion Euro factor therapy segment, which represents 70% of the overall hemophilia a non inhibitor market valued at seven 4 billion euros.
With that I hand over to Tomas to update you on the vaccine business.
Thank you Bill.
In Q2, we continue on a strong trajectory of Q1 and delivered $8, 7% sales growth.
The Covid pandemic progresses, we see a recovery of the booster vaccines and troubled franchisees across all regions.
BPH franchise also demonstrated good performance.
So the limited impact from China regenerative down so growth in the rest of the world and Europe more than Combusted for the expected decline in our reported USD. It says that is due to as you say the uptake of expertise.
As explained before we do not report says complexities with moving the share of profit you know their operating income.
And the quality for some months of meningitis and influenza franchisees, including some pigging and had mentioned Q2.
On the next slide I'd like to mention a significant milestone that took place in June .
The U S Advisory Committee and a musician practices CIP met a very important recommendation and protection of the.
Theyre senior citizens against influenza and its consequences.
The committee reviewed last sets of data available for every influenza vaccine license in the U S and they recognize that the standout those a flu vaccine, but none of the female protector seniors about 65 years of age.
That recommendation for the elderly population was a big it is.
It includes now proven idose enters the blood and abundance of debt that showing the benefit of prison idose, what especially elected.
This important step on any pinch of Humanization recommendation, but he is key to raise the bar for instance, a musician in people above the age of 65, and I'm glad that more seniors into future will benefit from protection.
So against the severe consequences, if it ends up such as pneumonia and cardiovascular events.
Now as we are approaching them and nothing would be to start 2022 weekends as she steps some uncertainties regarding possible COVID-19 related disruptions of L. T steps do remain.
However, I also want to raise theory that we expect another year of record sales. Thanks to our strategy to focus on high value vaccines that provide improved protection.
With that I hand, the Cologuard two <unk>.
Donuts moving now to Geneva mezzanine on slide 21.
The execution of our strategy continue to improve with Scotts is growing 6% in Q2, where we've continued to gain market share.
Gen Med sales decreased four 1% Street six 6 billion Euro also due to the impact of the divestiture and so the consolidation of your API. So puffy statements adjusting for these gen med sales decreased 1%.
Sales of non core assets were down eight six percentage of quota and mainly reflected expected easily.
And now our legacy oncology portfolio in China into the U S launch sales are affected by people with the erosion of the Basel insulin market.
Part of the divestiture, which are key to our ongoing strategy to streamlining efforts, excluding the impact of divestiture of non core assets, we are down six 7%.
On slide 22, I'd like to focus now on the performance of all costs that go into the second quarter.
Similar to Q1 <unk>.
Sales decreased 10, 9% in Q2, reflecting less COVID-19 related demand and also an increase in biosimilar competition.
Tuesday, where sales were up two 4% with growth in Europe , and the U S. Partially offset by the expected impact of the implementation of the DPP four insulin from made in China.
Total cloud and savings, which include zoo and launches were down 24% in China in Q2.
221 full year results, we expected the total <unk> sales in China would decrease around 30% into 'twenty.
I'm pleased to announce that as of to date, we expect 30% not to be exceeded.
In April at ACD Congress, we presented positive results of in range. So head to head study comparing to sue and they do that in type one diabetes using time and range as a primary endpoint.
So this will help us to close the gap in type, one diabetes versus bigger neck, and good strengths and to James position in type two diabetes, we are particularly pleased without Samsung franchise, which delivered a strong performance sales driven by as you look at the strong performance of <unk>.
As you look as it achieved robust adoption with more than 1000 patients treated since its launch.
Corresponding to around 25% of the complex vegetable markets and demonstrating excellent persistency rates.
Sales grew one eight.
8% in Q2, driven by continued growth in Europe , as well as a bump up in China.
Hollywood is included in there now.
Since the beginning of the year.
Seamless growth also coffee just from a gross to net worked into U S. C led to only a figures. Excluding this effect sales came in close to 50%.
<unk> delivered strong growth in China with sales up 921% this consistent strong performance in China.
Firms are success based.
Shifting to BBB.
And is there a recent success in Europe .
Global planning sales were flat in second quarter towards the lower sales in Europe , and the mandatory price cut in Japan beginning of April .
Advancing to slide 23, we continue our efforts provide access to.
Those most in need and not only in developing countries, but also in metro markets.
Since the start of this months uninsured people living with diabetes in the United States kind of being used including such as losses to jail admin up at 35 U S dollars parts. Its 30 day supply swell value program. This is a significant step forward from a previous value.
19, nine in U S dollar five months supply.
And 221 to value program with us.
More than 97000 times, providing many people with diabetes in the U S. So medications and eat with that.
And the call over to Julie Thank.
Thank you Eddie did and consumer health care, and we continue to execute on our three strategic priorities to deliver consistent growth.
As you can see on this page on a 12 month basis, we're growing above market for the third quarter in a row. It is been worrying to see that our team's hard work is delivering results, while striding along towards our standalone structure greatly contributing to our agility to capture market opportunities and respond to competition.
And while also keeping simplifying our portfolio, we're now down to 140 brands from over 215 18 months ago.
We have to compensate for some top line losses in the short term.
Greater focus and the increased resourcing better allocations behind on our priorities are clearly paying off.
Regarding the CLS Rx to OTC switch as you know the F E N V. A placed our actual use trial on clinical hold in May since then I'm glad to report we had a very constructive meeting with the agents and importantly, we received clarity from them on the path forward.
We are very encouraged by that interaction and we'll continue our conversations with the FDA in the coming months with a goal to finalize our next steps trust our motivation to progress. This project remains unchanged because CLO switch can provide improved access to safe and effective medicine for it.
And underserved condition and from a business I appreciated the size of that ever change remains unchanged.
On the next slide moving now into Q2 performance I'm very glad to report that despite a strong Q2 last year, we delivered over 9% sales correct.
For like organic growth, meaning excluding the impact of divestments and it's in the same period.
Is a double digit growth of 10, 5% pricing contributed to three and a half percentage point of prescribing.
With the COVID-19 pandemic, the omnicom variants, often causing symptoms that are very similar strong cold symptoms. This quarter was marked by a cough and cold season that last longer than usual, we were able to respond quickly and get our key brands in store as a result, we grew up almost 75%.
Also the digestive wellness our biggest category, we maintained strong momentum, reaching again almost double digit growth.
I'm very proud to absorb the strength of our business with growth coming from all categories and all geographies with that I hand, it to Oliver to our scale.
Thank you Judy.
I've highlighted by my colleagues, we continued to deliver strong top line results derived from our key growth drivers across our businesses.
Turning now to produce nice EPS I'm pleased to report a 16, 7% growth at constant exchange rate.
Looking at the drivers of this great performance, even slightly accelerated when comparing to the 61% growth reported in Chihuahua.
I've guided to gross margin continues to improve versus last year now reaching $74. One person songs through February about pulpwood their shift to specialty care products on efficiencies.
G&A is growing considerably less in sales.
The lower effective tax rate of 19% creates additional support.
I would like to highlight the R&D keeps growing at a significant pace due to our expanding pipeline platform acquisitions, such as Baidu map Ochiai. These omics omics.
Although our fee income consist mainly of the original items balance this quarter.
Moving to slide 28, I'm thinking of Europe to good view sales grew eight 4% up to say <unk> 2021 on that'll be Oi margin improved by 110 bps.
Putting us on a clear trajectory to deliver on our 30% margin target in 'twenty two.
We increased our R&D investment by more of uncertainty for the first half.
$3 1 billion from the Brooklyn, the power priority assets on our latest bolt on acquisitions.
So a quick update on our <unk> program on slide So why don't we have reached to $2 5 billion in the last six months, especially driven by operational excellence in the area of cost of sales as shown by a nice improvement in gross margin driven.
This includes around 200 million of pandemic related savings. So that we say that we will come back over time, so our ambition remains to achieve the underlying $2 5 billion by yearend.
You might wonder what did we do with this $2 5 billion savings well turning to slide 13, what I would like to highlight again that you've had all of your Opex related cities were reinvested in fact, our total accumulate people exit grew by 500 million due to investments in R&D and selling cost.
Most of the savings to be generated in the second half are going to be allocated to key programs in R&D.
Let's now move to the outlook.
On slide 32, with a very positive margin development through the first half we still have a bit to go to the subject of some pockets on the on the top part of the graph we are highlighting the drivers.
The main contributor will be that there would be some growth.
The group BYD molecule, partly from T shirt as pointed out before.
Other contributing factors will be capital gains from divestitures, which we estimate to be around shrimp on 50 million into second half meetings or do you expect that took hold the amount of 600 million public food Europe remains unchanged.
So restructuring of your alliance.
Yeah Tayo. It's a closed early obviously small will also have a positive effect.
It's really due to the accelerated reimbursement of the development balance associated with very generic on incentive fees on antibody collaboration.
As announced early.
In June , but generally will increase from 10% to 20%. So sure of its profit. So it is paid to Sanofi to reimburse some of your fund the development expenses excuse me look volumes. So retrospectively to Q2 on we'll start to be booked in Q.
On the other hand also some negative drivers to keep in mind, we have guided for 2022 gross margin improvement to be weighted to the first half of 'twenty two.
The second half underlying improvements are expected to be offset by macroeconomic headwinds such as increased cost of energy transportation umbrella and labor costs.
GBP on Insulins in China will also negatively affect the gross margin for that part of the business.
Regarding fixed two seller expectations specialty care onto your T will continue on their respective growth, particularly with more moderate rates.
It doesn't make gross would be more pronounced towards the end of the Europe . Although we continue to expect another record year of himself with a split 60 40 between Q3 and Q4 due to our excellent time to market.
So getting to the last slide of the full year of 2022 guidance, we are driving our expectations for EPS growth to around 15 person a consult exchange rate unforeseeable positive currency impact of 758, 5%.
On July actual rates.
Youre right.
Eight quarters of growth.
Another quarter with double digit EPS growth sound execution, along with the plan we laid out.
Important achievements were made during the quarter European Ishares or at least the mail just folks who is performing nicely three more approvals received for the Big center covering all age groups. He may be emailed into us on the kind of so called Alpha will submit to disease risks. So slimming priorities set to be filed following news of the map.
See you in February .
Pro formation progressing we remain on track to achieve our target on double digit EPS growth.
'twenty two.
Let's open the call now for Q&A.
So as a reminder, we would like to ask you to limit your questions to no more than two and three.
With Q&A you have two options to participate option why don't you take the maintenance I can imagine many of them.
It would be notified when your line is open to ask a question at that time. Please make sure. Your I mean UK on microphone ups and can I submit your question by clicking the Q&A I cannot think what can help to screen and your question was that if you back out that.
So we will now take the first question.
The first question will be from the Mexico has now come back to you Mike.
Great. Thank you very much for taking my question a little ecological busting. So first can I just ask on margins. Please gentlemen, thanks, you've talked about the renegotiation of <unk>.
<unk> and the fast payback, so stupid development on your own.
It seems like quite a smart move because the 10% of profit is quite meaningful on a method a few hundred million Euro next year. So my question really is what impact. This is going to have on margins in two H 2023, and then the 2025 target how should we really think about this change in the context of the greater than 32% target in 'twenty.
Five is it fair to assume no you'll.
You'll be comfortably ahead of this target because of this and you could really potentially expand margins next year as well through the Baidu App Hudson Bay.
First question. My second question is just on <unk>.
It seems like you've recruited the majority of patients required. So my question really is do you need to actually add more patients on the study or do you have enough to file regardless.
Off the clinical hold being lifted and then just in terms of commercial implications as a result.
Got a competitive market. So how is this safety signal really changed your thoughts on the commercial potential.
Okay.
The one question we asked people.
Yeah.
Alright. Thanks.
Thank you.
Always for kicking us off.
Thank you also for the compliment on the construction of the deal with Regeneron.
Worked up very well for both parties.
J P. So where do you stand as it in the numbers I think people into the yep. Thank you.
It can be.
We're glad to have.
The simplification of our worker.
With our partner <unk>.
This amount of Oh for R&D. We invested initially was due to be paid on very long period of time on this acceleration is quite meaningful and if it can really impact positively in that way.
It could be three years 'twenty four 'twenty five.
It's it's really three last week you also know that we don't get the royalties.
Out of the same.
The global service, which will come on top of that so the question is is that.
Two to expand our margin or 10 genre targets no b Mab as I've said several times.
Every opportunity we see to increase.
Or improve our P&L or increase our margin we are reinvesting at Orange. So that's where we are that's why do we want to do is that we are here for that.
Would you go for innovation.
Investing in our long term growth.
By.
Really being true to these couple of months of investing in tires.
Thank you well said.
John Reed calibrate them.
But we have enough patients to file.
Yes, we're quite far along with.
The relapsing Remitting study as Jim and I wanted to secondary progressive the primary progressive we're still enrolling there.
Yeah.
We've got more than 2000 patients currently on study and we continue to enroll around the globe with the exception of.
Youre not mistakes with a couple of other countries. So we are we feel like we will still have the recruitment is completed by the end of this year.
So we haven't changed our timelines at this point.
Yeah, just to contextualize these where you know.
We were <unk>.
Moving along quite well and we're about 2000 patients into the studies and then in April we've experienced what appeared to be a couple of cases.
[noise] hospital drug induced liver injury and that prompted us to make changes to the protocol.
That removed.
Underlying risk factors for injury because these patients all.
For the most part of the majority of them had what looked like underlying conditions that could've been contributors.
And we also increased the frequency of monitoring to every two weeks as opposed to every month.
And we're quite confident that that would then.
Reduce the risk that these are the sorts of events might be seen again in the future and <unk>.
Proceeding accordingly, we've enrolled at close to 200 patients so far they're all doing well.
The patients that we had on study.
For.
You know who had been now on on therapy for quite some months are doing fine. So we're quite confident we will get through this we've got we've got a check list from the F. D. A of things that they are asking for in terms of.
Some information on where we're checking off their check lists and hope to have back back to them by the end of September .
Move forward.
Thanks very clear.
Bill profile, where it stands now.
Yes.
We see this as still being the best in disease product.
And for the reasons that we've said from the beginning it's a brain penetrant <unk>, which we think is really important and we know that from the long term study. The extension that we had south of about 88% of patients that remain on therapy, 85% of patients relapse free at 72 weeks and an 85% reduction.
Got enhancing lesions as still a profile, which is great and we expect it to be a multi billion euro blockbusters.
Bill Okay next question.
The next question will be from Joe Weston from Credit Suisse.
Yeah. Thank you my question I have one on two P. M. One just general one on the U S Health care reform.
Anything that you'd like to tell us about say your perception of what seems to be likely to happen in the U S. But my question on D. P is whether you can give us any help on sales by indication you talked a lot about the atopic dermatitis that penetration, but you don't tell us say much about the asthma penetration so I guess so.
We can see as we go forward a way you could get particular growth and if I could just add to that is there any.
Region or indication of where you're getting to a level that government somehow thinking well. This is such a large drug I can do with price.
So is there any concern that you are now getting to that sort of level with higher price erosion likely.
Keith.
That is true.
To see at least from a distance I S. T. H I was hoping Florida philosophical question, but.
Okay.
You see.
Bill why don't you take that sales by indication.
The penetration in asthma and other indications yeah. Thanks, Joe.
We won't break it out by indication.
As we've said all along E D. It's been the first it's the market. That's the indication that's the least mature based upon us being the first product there.
And there's still plenty of growth and we're still at about that 9%.
Penetration rates in the U S. So we still see that as being.
The biggest indication now as you look at as much about 19% biologics penetration as we said in the past we think that can go up to about 30% or 40% and we've reported on previous calls from a respiratory perspective, we are the leading asset in respiratory bar.
Barr Nunn.
And I think just to provide the perspective.
We hear this quarter every now and then a question about a competitor getting an indication and I think you have to look at what we presented in the call here on what Paul talked about just with what we have approved this quarter. It's an additional 150000 patient opportunity and that is just a a sampling.
Of the additional age groups, we're going into an additional indication. So there is plenty of room for this to continue to grow now growth clearly gets attention, but this is a product with demonstrated efficacy that we haven't found anyone in the world who has pushed back on the benefit of what this product has to offer.
With additional competition et.
Et cetera.
Additional indications they're.
There will always be additional.
Pricing discussions, but we planned from the beginning for this to be a multi indication multi country product. So we feel that we can handle the extremely well and we don't expect anything above any kind of.
Pricing erosion that would be a typical in this space. So thanks.
Well I mean, the health economic data supports TPN beyond them every indication is absolutely incredible.
No.
The unmet need is massive so.
Okay, Joe the other person it was around.
The U S and reconciliation so maybe just take a step back for a second so.
We've come a long way from neutral three two to kind of reconciliation package.
On the table remind you it's not done yet.
You, probably even more aware of some of the technical processes that we have to go through in the U S.
The Bill has to go through with not even go up to the board about that.
Yes.
Understand the technical opportunity there.
Either which way it's not good for patients good for affordability for patients is not good for innovation in general let's be clear about that.
And I think we all know that.
I had the opportunity to sit down with <unk>.
Close to 90 Senators in one on ones last week to get all had surrounded somebody buy energy into it like I said might be is all and everybody is trying to to help remind people that it's not where it needs to be it is not doing what it's supposed to do in terms of helping patients through innovation affordability I mentioned, that's for us as a company.
No.
Of course, we have a little less exposure in the United States in general and that many of our peers and then if you because all portfolios a little diverse you see different levels of technical exposure and I think in general.
No we would say that we.
It's one of those things that we just have to take of course is not much choice, we'll find out what it says next week not good for patients.
Good for innovation frankly.
But we'll find a way that's always thanks Joe.
The next question will be from company from books Huh.
Yeah.
Great. Thanks for taking my questions. So firstly on the Doctor Coke and I think Paul you said in the physicians on your coal setting the reason for the.
Patient not to switch them, Danny reason, perhaps that it could be if they if they can't get reimbursement for it. So could you just help us understand your pricing and access strategy that youre thinking about president Evan is that what's called as you head towards launch.
And then I'll tell you the brief state I think John you just had a couple of cases of drug induced liver injury and it sounds like a very low incidence is it fair to assume the incidents here they were seeing in the trial. It's below the eve of breaching that phase two trials by around 26% of patients so race liver enzymes and 11% discontinued each liver enzyme.
Elevations.
Do you still see totally breach nib as potentially differentiated on liver profile versus either Bruce. Thank you.
Okay, great. Thank you will.
We'll come to children in Atlanta.
As far as on a sub could go golf and we look forward to showing the brand name with you.
When it's approved.
You know, it's it's a it's an interesting one right, we havent talked to Sharon price shut in but you jump in if you want to comment.
But the efficacy is so good.
My own time at IFC actually reinforce up.
The important thing to remember is what worked against us with heavily bravos sale uptake books for us with the South Dakota because.
Patients if they want to move in this market they will move.
So they'll get switch they'll get initiated the momentum is patients want to as normal as possible.
And so we are very excited about what we'll do with this much builds.
Bill do you want to add anything no I think that's right I think.
Couple of things there are favorable as well as what we've seen globally is still a recognition for innovation and clearly when you look in the.
Hemophilia space.
Don't see anything in the.
Real immediate term that looks to be as innovative as stephane now if the market becomes.
A purely efficacy driven market.
There's really only one choice because there's really only one product that has ever gotten you're close to near normal.
For the majority of the week. So we have high expectations. We're excited about it we believe that there'll be a path to.
Reimbursing for it and we believe that patients with.
We'll want to and they will seek out a higher efficacy option.
Thank you Bill John Reed how about.
The volumes, yes, Graham Youre correct.
The frequency at which we've seen these.
All four cases of drug induced liver injury has been very few patients for a fraction of a percent, whereas with evo they've had.
Double digit.
You know numbers or percentages of patients that have had to go off study because of liver transaminase increases. So we still believe that we have the strongest safety profile.
And the other thing is that these new use cases always occur within the first couple of months of treatment. So monitoring it is important to do potentially in the beginning of a therapy, but.
After patients have been on therapy for a couple of months.
If they haven't had a when we used our issues there theyre going to be fired up with like as I said, we have 2000 plus patients still on study.
And and up to this point Oh, well. So we think we've got a good plan for for.
Going forward with or reducing.
The problem and.
We will work through getting this resolved with the FDA as expeditiously as possible.
Sorry, John .
The line just cut that's like you say a few percent as double digit favorably. So I just want to clarify that instead of a fraction of loans.
That's what he's talking about.
Yes.
Double digits.
You know we've had a few questions on that honestly I mean, let's be really clear I think we've made the right changes to the protocol, we feel very good about that was to find the information to the regulator.
And it's really basically just the U S and then we're heading.
To get this corrected.
<unk> come off hold in Q4, but special working tools.
Okay. Next question next question will be from Richard <unk> from Jpmorgan.
Yeah.
Hi, yes, thanks for taking my questions upset switching topics, maybe to its vaccines festival and the and the fleet supply maybe you could give us some context on the amount of claims that in high dose we should anticipate in the.
In Europe in the U S. This season do you have enough capacity to say 60 million basis. This year and then a couple of questions or one question sorry on consumer.
Perhaps you could give us some context on how you see that the market price for branded products going forward in Q3, and Q4 and how are you thinking people will downgrade as we see the economic crisis might be worst thing a bit.
And if I can be cheeky tamiflu wasn't mentioned with CLS. So just what's going on with Timothy thanks very much.
Okay. Good thank.
Thank you maybe.
I'll come to you truly in a moment, but some are fluzone high dose volumes.
So although we are in very good spot from a screw something like perspective, Jenny supply is not going to be any problem.
And that's been important for the best to you and you know very well, but we build capacity, but you're also going to see a very consistent and it comes at a time as I mentioned during the position of the SAPIEN become mission. So so that's why we feel strong about delivering a record for the ship which comes on top of significant growth over the past few years as you know very well so it is.
Not the most people.
Bank, therefore, a good dozen idose.
In Europe and in.
So when we ship and of course that is a that can be seen this good level of supply by the indication of the fact that when you look at the timing, we expect roughly evenly to meet that need to be definitive about 60% of the fluke second half of the year to be in Q3. This is 40% of it being in Q4, which reflect the quality.
Sometimes we're getting.
Thanks, Tomer, that's great work on <unk> T lymphocytes.
Julie.
Oh people getting from branded.
Will people go from branded to generic pressure on peoples out of pocket expenses, maybe could come about.
Thank you rich that's a great question so first of all.
What we've seen in healthcare is that shares a private labels have been relatively stable.
In the past few years, however, with increased inflation pressure in an economic downturn. We are very conscious that can share was left to make choices more than in the past.
But we again, we've seen that in our area of consumers and patients make the least compromises.
And how this is definitely the most important and efficacy.
Very strong it's a very strong loyalty driver, even again again, even more so in health care and as a result of the quality and the value of our brands is what really makes a difference and that's what we're bringing forward and here I'm very confident.
On Tamiflu on time, you see nothing has changed from the last the.
The last quarter is that we are waiting for the season to be able to start doing that.
And then your testing so no news on <unk> so far.
Yes.
Thanks.
Also to be grounded in the pharmacy.
Next question.
The next question will be from that increasing or from anything.
Yes, thanks, very much can you hear me.
Yeah.
Great.
So congrats on the performance I have questions on <unk> and <unk>.
Dennis shrimp.
With regard to total a bruton nib.
Have you already enrolled enough patients in order to be able to deliver a sufficient U S regulatory filing.
And what is your current estimation or timing for top line phase III results from your global.
RMS studies.
And then regarding incentives DRAM is there an opportunity to pursue a more targeted approach with ESR one.
Patients with greater likelihood of generating compelling efficacy results. Thank.
Thank you very much.
Okay.
10-Q, I think we saw it a little bit on the TV question on enrollment, but submissions, but John do you have anything extra to add.
I would just add.
The RMS studies, we expect will read out.
And the next year.
And then the progressive studies would be the following year, which is pretty much on par with what we had originally forecasted.
At this point, we know we are it is a global trial that is actually our new series of trials and this is the largest campaign that's ever been.
Orchestrated for an M. S. Drugs. So are you just global we do feel like we are we have a U S sufficiently covered.
And I forget what was the other.
So that's something that you think we need to look at in ESR mutation to show greater efficacy or should we just focus on the adjuvant setting where the opportunity is right well actually you'll be able to see the.
The ESR immune versus wild type data at ESMO in terms of what we show in the late line setting.
But in terms of the where we really have always felt a sweet spot for this mechanism in the adjuvant space we.
We're quite comfortable with.
The profile, there, where there's a very small percentage.
Mutations in that setting and most patients still have wild type receptor.
But we were active events, both wild type and immune receptors. So we sort of have our bases covered I would say okay. Thanks, John next question. Please.
Yes.
Question will be from massive set from Morgan Stanley .
Hello.
Great. Thank you. Thank you very much for taking my questions I have two.
First one on R&D investment how should we think about the level of investment in Ara.
Andy going forward over the medium term.
How should we think about investment discipline here I mean, some of your style got so many new platforms to choose from delivering new medicines through the intention. So a nice problem to have but at 15% or so in terms of our teen margin is a nice.
Oxford, essentially with with gross margin, but it would be interesting to understand your high level of ambition in terms of increasing investment and future innovation and then the second question was on the CCAR five ADC.
Can you help us understand your ambitions beyond lung cancer as the understanding of Atc's I guess is changing quite a bit at the moment and what the key data points are to watch out for over the next 12 months in lung cancer.
Okay since more.
Jonathan.
Actually just thought maybe you'd like to Mexico, and Turkey, and R&D investment levels.
Thanks for the question, there's no magic number on that maybe by the way you consider Oh sure helps.
So your question because it doesn't consume R&D, Virginia.
Our vision is clear it's to increase with in respect of our guidance is to increase as much as we can.
Spend on R&D and Thats, what we are doing I know that sometimes it's.
I see that consensus.
Some are believing us.
He said.
Although the holidays this year.
That's what we are doing on Youll see it in Q2.
So if you're a proof point Oh, probably survived miss in terms of being too which is just coming to them. So.
I think she is.
I repeat the magic number, but the direction is clear.
Thanks, <unk> and John C sometime ADC beyond alone.
Yes, so we are pursuing that molecule for other she can put positive tumors.
Rick breast et cetera.
Still collecting data in those contexts, and then of course, then in lung where also in phase II studies in frontline and coupled with MRO and exploring whether we can move into the frontline setting with that.
So the question was more broad about modality is in general.
And if that's the case then indeed, we have quite substantially expanded and modernized our drug discovery infrastructure with new modalities, so that organic a lot of it through bolt on acquisitions, but.
Our ability to support those from a CMC manufacturing I feel quite confident we've been able to leverage our capabilities. For example in microbial production of insulin to support the synthetic platform synthetic biology, which to be coli platform to support the <unk> platform to support the antibody.
Arm, where again, we use microbial species and all that's really been able to ship.
Just kind of modify what we had available at.
At our Frankfurt site there.
And then the.
The other biologics platforms, we've been able to adapt to what we've had there and then we're really leveraging a lot of capabilities in vaccines for some of the others for example, AAV platform.
You know, making viruses like takeaway viruses for vaccines is something our colleagues there don't have to do for years and we're actually doing or do you have a few production of vaccines facility, there and leveraging that and of course, they are more of a commitment to the mrna platform that the vaccine salaries.
What are you just plug right into that for the for the therapeutics as well.
So let me, let me try and connect the trials together at Chico's really interesting question.
To Jamie's point.
All parties to deliver our financial guidance and commitments and we work really hard to reallocate R&D within that so, let's just be really clear because that stuff to go within what we've committed.
Side of the platform piece you know we made the decision to join the team to take apart from but it's one of the reasons why we have 13 shots on goal in immunology half more than half in animals.
So we get a really.
<unk> entry to have a shot at least two proof of concept and beyond and I think we knew that was probably going to be all best buy but the real magic Bill will slowly start to converge platforms and that's why as we were bringing them in.
And say on top of antibodies.
Thoughts to help us get to a tunable piece. So there is individual pepco opportunity at volume at scale as we get into a surprise, but not far off.
Then there is a convergence of the apartment homes have been a lot of opportunity and we worked really hard as a team and the people around this table and beyond to make sure that we can redistribute.
Deliver guidance we distribute.
First to talk.
The phone to talk to him okay.
Okay next question Oh the.
The next question will be from can you panic from Goldman Sachs.
Hi, Thank you for taking my questions and John if I could just confirm your answer to your question are you confident that you have enough U S patients given the extra patients you are recruiting on the collaborative program kind of elsewhere around the world for it to be okay from an FC.
Are you a perspective.
Secondly, I'm kind of I'm, just looking at the consumer health business, clearly kind of demonstrating very strong execution and continued growth.
But your guidance assumes kind of much more deceleration in growth towards the second half of the year.
I'm just wondering beyond tougher comps is there anything else you are seeing from an end market perspective that is pricing or should we think of it as classic Sino freaked underway because I'm on this guidance what we go thank you.
Yeah.
Maybe I didn't quite get the second question, but why do you assume is going to repeat this to me.
First question.
John I'm not sure there's much more to add on the on the tour.
I can understand everybody's level of interest, but just.
Fast retail right with the adjusted and the protocol we were in good shape and we get the questions. We get the partial hold we've we know what we need to do to come off that we have to get that done we come off in Q4, when we get on with it.
So if there's anything more to add to that at any point.
The word partial I think is very important because it means all of the patients who had already been enrolled and we're 60 days plus past silver on study, including in the United States. So all of those patients continue to be followed until you'll be outcome of the study.
So I think just remember that although we didn't reemphasize here, but it probably merits that.
The liver injury cases, we saw were reversible nobody went to transplant a Buddy guide I mean, if they were picked up by a routine monitoring.
So we.
We feel like.
We can address this.
Got it.
You have the F D a.
Check list of things that they wanted additional return to us.
Jonathan J B.
Are you being conservative Okay Europe .
With me.
No no.
I have more and more enticing to have and we don't see anything yet.
Let's see.
Thus far have with <unk>.
It's probably going to be very short list of all of the year.
Sure.
We are raising our guidance, let's summarize it.
What sort of goodwill.
Okay next question please.
I think there was a question of consumer yes.
And.
How we see the remainder of the year I think what's important so first of all thank you for saying what you said because just not so long ago, we were losing share for them for awhile and it's pretty since since Q4 of last year that that we've been catching up on a 12 month rolling basis.
Looking ahead after his fifth I think strong quarter, we expect the market to experience it more normalized growth because we have to keep in mind that we had at the market overall and we get to a higher 2021 comparison, but we still have the ambition to continue to grow in line or slightly ahead of the market.
Thank you Melissa Okay borrowing.
Yes next question, Tim I'm guessing from colors.
Thank you a couple of questions.
On <unk>.
And it's really on China.
China, there's at least one lookalike product moving into phase III and in certain categories. We've seen fast follower products kind of cause headaches for multinationals. So I'm wondering how much China is in Euro 13 billion euro forecast for duplex.
And just in general how are you viewing local market competitors that you see potentially emerging nearer term and then second question on colubrid nib.
Back on <unk> televisions, I know the frequency that was low or any of those grade three or grade four and then have any other countries. Besides the U S put the drug on clinical hold.
Okay, well that I'm going to.
Throw to you we'll compete in.
In China I think.
Just put me back with us at all the TV Newcrest decided to stop as we get more information we'll share it with you would speak going into Q3, but cutting off the whole so priority and we'll update you.
Anything to add on China, China is part of the weight of $13 billion and over the past follow up to market. It is it certainly as dawn I think what we've also said is that we expect it to be a blockbuster in its own right and in China. So the opportunity there.
We think it's still a very significant and we're just at the beginning just like we are everywhere else in the world where at the beginning in China, We're seeing some really great.
Great uptake additional indications that we've been successful with.
The positive data readouts since early with some another asthma trial there so yes.
Now we think that.
Within China.
China any follower.
I have two first of all compete against the product, which has kind of opened up the market in China, we expect that.
We have high hopes that there will be a recognition of the IP that exists within China, and we think that the expertise that we brought to the market will be recognized and when.
As we get more information on it and we're not even certain if anything will come at this point, but we're not.
As I said, it's baked into our $1 billion plus forecast that we have in the waypoint of $13 billion offset yes.
Maybe.
We've started really well.
I mean really unprecedented start really for a biologic being up to maybe I can.
Sure Tom.
A lot of launches in China, we'll get them up and so it's a rocket ship them, even after they're locked out from another.
It tends to come in about it today, but patients coming literally straight back catalogues and getting to see that dermatologists cigarette so bodes well, but it's pretty well okay.
Next question. Please then.
Next question will be from Noah Kaye from UBS.
Hi, Thank you for taking my questions.
I have a question on wells that button and please could.
Could you just talk to the commercial potential for that.
C P. Given that we've seen a molecule terminated in this space.
Last today, albeit nothing at all even though there was no.
The negative data and secondly could you maybe just tell US why you discontinued depending them up in peanut allergy. Thanks.
Yeah.
Okay, well, John I'll come to you and peanut allergy.
Bill maybe just a general comment about rules overall the approach and then maybe at CP.
Yeah no.
For the question so look.
Let me start with ICP Theres about 25000, chronic I can take it.
Dogs in the U S. They're eligible for the second line plus treatment after.
After steroids.
So again coming fresh off a bias T H and hearing from the physicians there was a lot of enthusiasm about our real estate in the IPP space. They clearly see theres, an unmet need there and they liked to be.
Fast onset of action and durable.
Fact that took place so we'll continue.
You know what.
For the data so to speak but now we see that as a as a as a.
Nice potential and also with relative we've got a broad development plan and we're also looking at it in a day looking at it in asthma.
Looking at it.
In <unk> four.
Weihai et cetera. So this is one of those products that we think it's so fundamental the biology that it gets us into a lot of spaces, obviously, you've seen the <unk> and the effect in MF with call it broken up but we think.
Reels that allows us to go to other places as well so.
Quite promising and an ITT specifically.
<unk> data fast onset of action durable effects.
Thanks, Phil Shawn and they come in on Peanuts, religion, well I can say to you know it's a it's really difficult to do a good clinical trials in that space. We did do some phase III kind of exploratory work.
Just your thoughts there.
No. It was not ranking is finally, among our strategic priorities as other places we could invest and so we kind of just let it.
Stay there for now.
Okay.
Thank you. Okay. Next question. Please next question is from God, He Stephen Dunn from exam.
Oh, yes, sorry to say Simon asked I apologize.
So my question is in a normal holiday Smith. Thank you firstly, a follow up on the margin question, because I mean, youre able to consistently deliver strong results. Despite a commitment to mainland you increased your investment in R&D I'm.
I'm thinking just taken into account in the prior commentary around a meaningful pick some gross margin step up from 24.
General renegotiation, you just talked about earlier.
It's not a high margin offerings I mean, the question really is when do you think you may be able to quantify them.
And the more than 32% operating target.
<unk> thousand 25, just a quick follow up can you quantify the remaining R&D spend up by our general and the second question.
So I was wondering if you could be willing to share your latest views on the long time.
<unk> liabilities were the first telecom phone call early next year I mean I appreciate it isn't that has become somewhat of a defense attorney celebrity.
I'm just wondering if you could potentially shake off on your exposure.
Remarks that <unk> could potentially dwarf roundup. Thank you.
Okay. Simon. Thank you so let's start with JV that will go to Julien.
Yeah.
Yes, sorry, if I'm and I I'll have to just to repeat the same message.
<unk> increased our R&D spend.
As much as we can if we have room to do it because you.
You see our portfolio, where you see the need for innovation.
Once we stop advisers coming from.
Okay.
Folding carton.
It is an indication that I can tell you said we will not.
No.
Have finished drugs this accelerated repayment, what it's going to impact us steel 26, so yes, it's a very significant amount of R&D.
Let's see.
Coming back to us.
Due to the acceleration of the development.
That's great that means that we can become even better.
More innovation.
Thank you Julien genomics, who will comment on some sometimes sure. So first of all I want to remind that Sanofi voluntarily we drew <unk> from the market in 19, and and and zantac OTC products containing or an incident.
<unk> of the market, both the FDA and Sanofi have conducted investigations into the levels of N DNA and ranitidine products D. M. D has stated that although N DNA may cause harm in Orange, a mountain ski and D&A level at the FDA found in Zantac ranitidine.
From the preliminary tests barely sheepskin mountains found in common truths. Therefore, we need to know if he believes strongly in our defenses.
Sanofi contends that the plaintiffs will be enabled to prove that zantac caused us any type of cancer basically the science does simply not support the plaintiff's claims so we're confident okay.
And what would you want to add anything I think it's I think commented well then that's probably not all evidenced spots.
So that doesn't concern are the amounts or stuff that's on and I think you're about to come on foods and we feel very strongly about our defenses and also we have to responsibly Martin responses at all times.
Thank you and yours questions next question will be from Simon Baker from Redburn.
Yes.
Thank you very much for taking my question two if I may one on vaccines.
I'm one of them consumer also.
Just a quick clarification on.
Please.
Record your tomo is that like what do you have in terms of.
Just just a value over volume and value.
The main question on <unk>.
Vaccines, which you indicated that you have data for the kind of thing.
Go against on the Columbia, One I just wanted to it's still fairly early stage. If you have any data you can see a four five and then on consumer.
Excuse me I Wonder if you could give us a little color on.
The regional splits of pricing you said it was too simple rule.
Could you give us any color on that would be very handy also.
Some of the moving parts within what was a very impressive performance on the gross margins, while I'm, assuming the pulls and pushes on that if you could give us some color that would be very helpful. Thank you. Okay. So.
Thomas then record.
P C.
Between body Boeing of course, and that's what it is I did NBA for five.
Kevin.
Thanks for the question Simon.
It's been awhile since we stopped talking about volume. So what we're really looking is how do we do we are.
So each time, we were talking about like go through yes, it's about safe and.
Especially as we know they way we've pivoted our thunder out those flu vaccines, a few years ago to the email.
Differentiated flu vaccines that provide predictions beyond through endpoint et cetera. So we're really in the market used to be originating the value of this product and therefore, each time, we're thinking about the recall deal is different.
Uhm.
The second question is about COVID-19.
You don't need that.
I think against <unk> five early read but shows exactly what we have seen again be it won't be too. So I'm confident that the booster we'd be providing to the market if approved.
I think the ability to be a we still have a.
A fuel of choice as this because we felt a pud during his presentation.
We believe it's a group of Fuji fellows because tissue makers.
Thomas J I'm not sure how we'd normally break crosstown publicly chooses not to show its okay.
By region I don't think we usually share what I can say is that the majority of our portfolio, we can impact pricing and that we obviously do it based on the actual raw material cost.
And behavior by region as well.
Tumor necessity.
All regions have increased prices.
<unk> gross margin.
Well.
So margin.
So she achieved.
In terms of gross margin.
Part of it is that something that got repriced.
And so it's.
It's been selling quite well.
We see that across the board on all of the regions.
In terms of a.
And of course, we've kind of reached through our current sectorial a publication.
Publication.
The gross margin a C T sets will be centralized more like next year.
Okay. Thank you next question, yes. The next question will be from Sumit.
Some of this learning from Guggenheim.
Yes. Thanks can you just hoping you guys could uptick.
Update us on <unk> and the progress towards.
Hopefully entering Registrational trials, maybe you can just talk a little bit about the differentiation that you see that product as well.
I know it's core to the continued.
Attempts towards dominance in the in the immunology space. So love to hear your thoughts along those lines and when we might see data I believe FERC first quarter of next year was the target.
But didn't know if we might see advancement into pivotal sooner than that thanks.
Okay. Thanks, John .
John why do we have the winner with Oh, Yeah, Let me maybe do the differentiation first and then cover where we are at.
Breaking to accelerate.
On the differentiation as you know, we're targeting with ligand, whereas others are targeting the receptor.
And there.
Reason to believe that it could be better from the standpoint that the ligand is.
As prevalent at lower levels than you would have less problem really covering the full target and getting good targeted exposure we believe.
But more importantly, probably is that.
Telematics is a non depleting antibody it doesn't kill was holes that express the ligand, whereas the competitor molecule that binds receptor actually kills the cells.
And we think over the long run.
Because it's a depleting antibody that's gonna be disadvantageous, because among the cells that express there.
<unk> 40 versus the receptor or regulatory T cells, the immunosuppressive cells that you need for immune homeostasis.
We also think because that is sort of bleeding antibody that activates complement another mechanism that that's probably why they could be.
Competing molecule has shown evidence of infusion.
Types of reactions with <unk>.
Bravo episodes and other sorts of evidence of inflammatory responses in the first couple of injections of course, we don't have anything like that with them with telematics.
In terms of the acceleration we are very much working directly with all health authorities around the world to explore what is possible, we're still trying to work out.
Best path forward for meeting all the regulatory requirements are normally around demonstrate yesterday, but also the <unk>.
Safety database that will be required et cetera.
To make sure that.
The study populations those represent.
The diversity of patients that struggle with atopic dermatitis.
Both in terms of what therapies, they've experienced as well as of course.
The types of issues around representation. So we're.
We're really working with the authorities to to figure out how quickly can we deliver high quality data.
We will have more to tell you is those discussions and plans.
<unk>.
Okay. So I think so.
So then just mechanistically, we have the advantage I think we want to get the students. We can you know we're ambitious we told you that we're looking for.
All of the opportunities to do that and when we can confirm that we will do that.
But it's going to be really important too to make sure everybody understands the full benefit of this medicine can do.
And how they listen to.
Two of them up to last week, and it's starting to get really exciting. So really appreciate the question.
We have time for one more when was the last one would it be from Pizza hut, Doug from BTT.
Thanks, Yes, thanks, Paul Thanks around people don't Citi two questions just to pull first kind of three years since the play to win strategy that was laid out.
We continue to be very keen.
To highlight the absence of Eloise post Apache Yeah. So the question is when might we get revised midterm targets and are they likely to pivot towards top line growth aspirations, rather than staying focused on margins and free cash flow and then secondly, very quickly for John on the pipe.
Correct for this asset is still viable in light of the recent data so highlighting a qt signal.
Excellent question so.
So there's some reflections maybe three years I think it's incredible the speed and transformations company Pizza company.
Incredible do incredible things.
So I would probably say, we're ahead of where I had hoped.
In the weeks, leading up to join us.
You know I think we have to earn the right to.
To move to that sort of top line.
Science.
The guidance.
We set back in 19.
Good.
To credibility from delivering exactly what we said we would do and so we've got that's non negotiable for us and I think we are building quite a high degree of trust on that maybe they'll become a moment when we get to look further ahead as of course, you would expect that and to be bold about what that looks like for us because of course the investments in R&D.
That's an important consideration over the long term, but I do think we have to we're not quite at that point, yet and when we're ready to share that.
We built it.
IRAK four.
You know, it's pretty fascinating, we touched a little bit on those recruitment.
Earlier.
No.
In biologics.
Related marketplaces, they're all rooms.
Beautifully put together.
You know, it's been a Holy Grail for most companies and most diseases.
It's it's a needle to thread.
You have to remember that the goal is not always to be as good as a biologic that could be a relevant medicine on the journey up to a biologic.
And so we know what you have to look like to be a successful and the volume to slightly other diseases.
So unlike some of the older boy animal rule and <unk> you have to think in those terms. So we remain enthusiastic about the IRAK four methods.
We're working with the team so I'm, making sure that we because we're careful and judicious about where we spend our R&D dollars that we think we would have a profile.
It could be meaningful show us in the market.
So stay with us on that and I'm glad you asked about it because as we build out our immunology.
Leadership.
Across the entire industry.
We've got somebody in two shots on goal with different mechanisms patient populations are different methods to defer it.
So so yeah. Thanks, Peter that's a good way to maybe to bring it to an end if that's okay.
Ah Thanks to the team I am certain people, Dennis and thanks to everybody.
As tuned in with doing exactly what we would say we would do in a little bit more and we look forward to reconnecting with you in Q3 and in between thank you Dawn.
Yeah.
Yes.