Q1 2023 AbbVie Inc Earnings Call

Operator: Good morning, and thank you for standing by. Welcome to the Abbey First Quarter, Twenty-23 Earnings Conference. All participants will be able to listen only to the question and answer portion of this call. You may ask a question by pressing star 1 on your phone.

Speaker 1: Good morning and thank you for standing by.

Speaker 1: Welcome to the AbbVie first quarter 2023 earnings conference call. All participants will be able to listen only until the question and answer portion of this call. You may ask a question by pressing star 1 on your phone. I would now like to introduce Ms. Liz Shea, Senior Vice President Investor Relations.

Liz Shea: I would now like to introduce Ms. Liz Shea, Senior Vice President, Investor Relations. Good morning, and thanks for joining us. Also on the call with me today are Rick Gonzalez, Chairman of the Board and Chief Executive Officer; Rob Michael, Vice Chairman and President; Jeff Stewart, Executive Vice President and Chief Commercial Officer; Scott Rents, Executive Vice President and Chief Financial Officer; Carrie Strom, Senior Vice President and President, Allard; and Tom Hudson, Senior Vice President, R&T.

Speaker 2: Good morning and thanks for joining us. Also on the call with me today are Rick Gonzalez, Chairman of the Board and Chief Executive Officer, Rob Michael, Vice Chairman and President, Jeff Stewart, Executive Vice President and Chief Commercial Officer, Scott Rents, Executive Vice President and Chief Financial Officer, Carrie Strom, Senior Vice President and President, Al Arganisthetics.

Liz Shea: Joining us for the Q&A portion of the call is Rupal Thacker, Senior Vice President, Development and Regulatory Affairs, and Chief. Before we get started, I'll note that some statements we make today may be considered forward-looking statements, and certainties that may cause actual results to differ materially. Additional information about these risks and uncertainties is included, and the Company undertakes no obligation to update these forward-looking statements except as required. On today's conference call, non-get financial measures will be used, non-gap financial measures are reconciled with comparable gas financial measures and our earnings and regulatory volatility. Following our prepared remarks, we'll take your questions. So with that, I'll turn the call over to you. Thank you, Liz.

Speaker 2: and Tom Hudson, Senior Vice President, R&D, and Chief Scientific Officer.

Speaker 2: Joining us for the Q&A portion of the call is Rupal Thakkar, Senior Vice President, Development and Regulatory Affairs and Chief Medical Officer.

Speaker 2: Before we get started, I'll note that some statements we make today may be considered forward-looking statements based on our current expectations.

Speaker 2: Abby cautioned to be forward looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated in our forward looking statements.

Speaker 2: Additional information about these risks and uncertainties is included in our SEC filings. ABBYY undertakes no obligation to update these forward-looking statements except as required by law. On today's conference call, non-GAAP financial measures will be used to help investors understand ABBYY's business performance. These non-GAAP financial measures are reconciled with comparable GAAP financial measures in our earnings release.

Rick Gonzalez: Good morning, everyone, and thank you for joining us today. I'm extremely pleased with our start to 2023, with first quarter total revenues and adjusted earnings per share both exceeding our expectations. This performance was driven by double-digit sales growth from several key products, including Skyrisi, Rinvoke, Ben Klexta, and Valar, positive momentum from our aesthetics business with strong results internationally and stabilizing consumer trends in the U.S., and an in-line performance from U.S. Humera, where biosimilar erosion is tracking as expected, much of the impact driven by pride.

Speaker 3: to 2023 with first quarter total revenues and adjusted earnings per share both exceeding our expectations.

Speaker 3: This performance was driven by double-digit sales growth from several key products including Skyrizzy, Rinvoke, Venkleta and Vaylar positive momentum from our aesthetics business with strong results internationally and stabilizing consumer trends in the US.

Speaker 3: inline performance from US-Humira where biosimilar erosion is tracking as expected.

Speaker 3: in line performance from US-Humira, where biosimilar erosion is tracking as expected, with much of the impact driven by price.

Rick Gonzalez: Since our inception, we have successfully created a well-diversified portfolio with multiple growth platforms in highly attractive markets, including immunology, hematology, oncology, neuroscience, and aesthetics. Our commercial execution, including the launch of new products and expanded indications, has been outstanding, especially across Skyrisian Winvoke and recently with Valar and MDD. Each of these assets is expected to contribute significant revenue growth over the decade. The breadth and depth of our R&D pipeline also support our long-term growth outlook, and we anticipate numerous important pipeline milestones over the next two years. In summary, we are one quarter into the U.S. biosimilar event for Humera and are managing the erosion well.

Speaker 3: Since our inception, we have successfully created a well-diversified portfolio with multiple growth platforms in highly attractive markets, including immunology, immunological psychology, neuroscience, and aesthetics.

Speaker 3: Our commercial execution, including the launch of new products and expanded indications, has been outstanding, especially across Skyrisian RINVOGUE and recently with VELAR and MDD.

Speaker 3: Each of these assets are expected to contribute significant revenue growth over the decade.

Speaker 3: The breadth and the depth of our R&D pipeline also supports our long-term growth outlook, and we anticipate numerous important pipeline milestones over the next two years. In summary, we are one quarter into the U.S. biosimilar event for Jumera and are managing the erosion well.

Rick Gonzalez: Most importantly, our growth platform is demonstrating strong performance, exceeding our expectations. We are executing well across all aspects of our business and see numerous opportunities for our diverse portfolio to drive long-term growth. With that, I'll turn the call over to Rob for additional comments on our business performance.

Speaker 3: Most importantly, our growth platform is demonstrating strong performance, exceeding our expectations.

Speaker 3: We are executing well across all aspects of our business and see numerous opportunities for a diverse portfolio to drive long-term growth. With that, I'll turn the call over to Rob for additional comments on our business performance. Rob? Thank you, Rick. We're off to an excellent start in 2023.

Robert A. Michael: Thank you, Rick. We're off to an excellent start in 2023, with each of our five key therapeutic areas meeting or exceeding our first quarter expectations, testament to the strength of our broad portfolio. We delivered adjusted earnings per share of $2, which is 10 cents above our guidance midpoint, and total net revenues were $12, approximately 400 million ahead of our expectations. First quarter results include continued robust performance from Sky Rizzi and Rinvoke, which remain on track to contribute more than $11 billion in combined sales this year. Growth rates in the first quarter for both products are consistent with our full year expectations.

Speaker 4: with each of our five key therapeutic areas meeting or exceeding our first quarter expectations.

Speaker 4: testament to the strength of our broad portfolio.

Speaker 4: We delivered adjusted earnings per share of $2.46.

Speaker 4: which is 10 cents above our guidance midpoint.

Speaker 4: Total net revenues were $12.2 billion.

Speaker 4: approximately $400 million ahead of our expectations. First quarter results include continued robust performance from SkyRizy and Rinvoke, which remain on track to contribute more than $11 billion in combined sales this year. Growth rates in the first quarter for both products are consistent with our full year expectations.

Robert A. Michael: Skyrizi and Rinvoke are demonstrating momentum across all approved indications, and we expect to round out their opportunities in IBD later this year. This includes Rinvok's anticipated U.S. approval in Crohn's disease, as well as Skyrizi's European launch in Crohn's and its global regulatory submission in UC. We are also performing exceptionally well in neuroscience. Total net revenues this quarter were nearly $200 million above our guidance, with RELAR sales accelerating following MDD approval, and migraine delivering strong growth. As a result, we will be increasing our funding outlook for neuroscience.

Speaker 4: European launching Crohn's and its global regulatory submission in UC.

Speaker 4: We are also performing exceptionally well in neuroscience.

Speaker 4: Total net revenues this quarter were nearly $200 million above our guidance.

Speaker 4: with Vrelar cells accelerating following MDD approval and migraine delivering strong growth. As a result, we will be increasing our foliar outlook for neuroscience.

Robert A. Michael: Aesthetics is also performing better than expected. We are seeing positive recovery trends in China and some stability in the U.S. market, where we are closely monitoring several economic indicators that correlate with aesthetic procedures, including consumer confidence, personal consumption, and Google searches. Although it's still early in the year, these positive trends, especially across our international markets, give us the confidence to increase our full-year outlook for aesthetics as well. This continues to be an underpenetrant, with significant growth potential.

Speaker 4: Aesthetics is also performing better than expected. We are seeing positive recovery trends in China and some stability in the U.S. market, where we are closely monitoring several economic indicators that correlate with aesthetics procedures, including consumer confidence, personal consumption, and Google searches.

Speaker 4: Although it's still early in the year, these positive trends, especially across our international markets, give us the confidence to increase our full year outlook for aesthetics as well. This continues to be an under-penetrated market with significant growth potential.

Speaker 4: Based on our robust performance this quarter and the continued strong outlook for our business, we are raising our Fulfill Your Adjusted Earnings Per Share guidance by $0.10 and now expect adjusted earnings per share between $10.72 and $11.12.

Robert A. Michael: Based on our robust performance this quarter and the continued strong outlook for our business, we are raising our portfolio adjusted earnings per share guidance by 10 cents. We now expect adjusted earnings per share between $10 and $72 and $11.12.

Speaker 4: In closing, I'm extremely pleased with the performance of our diverse portfolio. We're off to a strong start to the year, which further reinforces our confidence in the long-term outlook of the business.

Speaker 4: With that, I'll turn the call over to Jeff for additional comments on our commercial highlights. Thank you very much forever hearing none of our

Speaker 4: Thank you, Rob. I'm very pleased with the strong commercial execution across our therapeutic portfolio.

Jeffrey Ryan Stewart: In closing, I'm extremely pleased with the performance of our diverse portfolio. We're off to a strong start to the year, which further reinforces our confidence in the long-term outlook of the business. With that, I'll turn the call over to Jeff for additional comments on our commercial highlights. Thank you, Rob.

Immunology delivered total revenues of approximately $5.6 billion, with continued robust double-digit growth from Skyrizzi and Rinvoke.

Guirizzi global sales were nearly $1.4 billion, reflecting operational growth of more than 46%.

despite retail inventory destocking in the quarter. DiRizzi is the clear market leader in the U.S. biologic psoriasis market, with a total prescription share now at 30%.

Jeffrey Ryan Stewart: I'm very pleased with strong commercial execution across our therapeutic portfolio. Immunology delivered total revenues of approximately $5. With continued robust double-digit growth from Skyrisi and Rinvote, Guyrizi Global Sales were nearly $1. Reflecting operational growth of more than 46%, despite retail inventory de-stocking in the quarter, Guy Rizzi is the clear market leader in the U.S. biologic psoriasis market with a total prescription share now at 30%. In psoriasis, Skyri has set a very high bar relative to other therapies on the market or in development, with differentiated attributes across the categories that physicians and patients deem most important.

In psoriasis, Skyrizzi has set a very high bar relative to other therapies on the market or in development.

with differentiated attributes across the categories that physicians and patients deem most important. This includes the rapid onset of action after the first dose, nearly complete skin clearance with multi-fold higher rates on PASI 90 and PASI 100.

high durability of response, which we have demonstrated can increase over time, as well as quarterly dosing for maintenance therapy, a convenient alternative to daily oral or more frequently administered injectables.

With a nearly 50% US in-play share of new and switching patients, there is substantial room for Skyrizzi's continued growth in psoriasis.

This best-in-class profile is supporting strong momentum now in psoriatic arthritis, with Skyrizzi achieving an in-play biologic share of roughly 20% in the U.S. dermatology segment.

Jeffrey Ryan Stewart: This includes the rapid onset of action after the first dose, nearly complete skin clearance with multi-fold higher rates on PASI-90 and PASI-100, high durability of response, which we have demonstrated can increase over time, as well as quarterly dosing for maintenance therapy, a convenient alternative to daily oral or more frequently administered injecting. With a nearly 50% U.S. in-place share of new and switching patients, there is substantial room for Skyrisi's continued growth in psoriasis.

Gairizi is also being co-positioned with RINVOC in the US room segment in PSA, where we are seeing increasing utilization among rheumatologists as well.

total market share leadership in nearly 20 of those key markets.

In Crohn's disease, we are seeing very fast adoption of Skyrizzi in the US, with a total in-play patient share at approximately 20%, second only to Stelara.

Feedback from gastroenterologists is very positive, especially as it relates to Skyrizzi's novel dosing and overall clinical profile.

We see strong uptake in Japan and Canada as well with the European launch forthcoming.

Jeffrey Ryan Stewart: This best-in-class profile is supporting strong momentum now in soriatic arthritis, with Skyrisi achieving an in-play biologic share of roughly 20% in the U.S. dermatology sector. Gariz is also being co-positioned with Rinvoke in the U.S. Room segment for PSA, where we are seeing increasing utilization among rheumatologists as well. Globally, Skyrizi has achieved in place, sorietic disease leadership in more than 25 countries and total market share leadership in nearly 20 of those key markets.

We also recently reported strong induction data for Skyrizzi in ulcerative colitis, which Tom will discuss momentarily.

Based on the results of that trial, it is increasingly clear that Skyrizzi represents a differentiated asset across inflammatory bowel disease, and we look forward to bringing this potential new indication to physicians and patients next year.

year. Turning now to RINVOC which delivered global sales of 686 million dollars reflecting operational growth of more than 50% despite similar retail inventory destocking in the quarter.

Jeffrey Ryan Stewart: In Crohn's disease, we are seeing very fast adoption of Skyrisi in the U.S. With a total in-play patient share at approximately 20 percent, second only to Stolara, feedback from gastroenterologists is very positive, especially as it relates to Skyrisi's novel dosing and overall clinical profile. We see strong uptake in Japan and Canada as well, with the European launch forthcoming. We also recently reported strong induction data for Skyrisi in ulcerative colitis, which Tom will discuss momentarily.

I'm very pleased with the performance in rheumatology, with total prescriptions increasing across each of the four approved indications.

Atopic dermatitis is also tracking in line with our expectations. We continue to see market share momentum globally, including in-play patient share increasing to approximately 17% in the US.

We are very excited about the growth potential in gastroenterology.

Rinvoke has set a high bar for efficacy in both ulcerative colitis and Crohn's disease.

demonstrating strong rates of remission and endoscopic improvement.

We're seeing very strong momentum in UC where adoption has been robust.

RINVOC is now achieving a 23% in-place share in the US second line plus setting, reflecting an impressive ramp since our launch in UC less than one year ago. This accelerated adoption among Gastro-neurologists is very encouraging for RINVOC's pending outlook in Crohn's. We are currently launching this indication in the EU.

Jeffrey Ryan Stewart: Based on the results of that trial, it is increasingly clear that Skyri is a differentiated asset across inflammatory bowel disease, and we look forward to bringing this potential new indication to physicians. Turning now to Rinvoke, which delivered global sales of $686 million, reflecting operational growth of more than 50% despite similar retail inventory de-stocking in the quarter. I'm very pleased with the performance in rheumatology, with total prescriptions increasing across each of the four approved indications.

a geography where RINVOC is the only JAC approved to treat both IBD conditions, and we remain on track for CD approval and commercialization in the U.S. later this quarter, with broad formulary access anticipated to ramp quickly over the back half of this year.

So we see inflammatory bowel disease continues to be an area of high unmet need, having two novel therapies in IBD with Skyrizzi and Rinvoke that each deliver differentiated levels of efficacy.

Jeffrey Ryan Stewart: Atopic dermatitis is also tracking in line with our expectations. We continue to see market share momentum globally, including in-play patient share, increasing to approximately 17% in the U.S. We are very excited about the growth potential in gastroenterology. RINVoke has set a high bar for efficacy in both ulcerative colitis and Crohn's disease, demonstrating strong rates of remission and endoscopic improvement. We're seeing very strong momentum in UC, where adoption has been robust. Rinvoke is now achieving a 23% in-place share in the U.S. Second Line Plus setting, reflecting an impressive ramp since our launch in California less than one year ago.

is an important step forward for patients. And with these two complementary assets, we are very well positioned to compete against other oral or biological agents. Global Humira sales were approximately $3.5 billion, down 24.3% on an operational basis due to biosimilar competition.

Erosion in the US remains in line with our expectations with most of the impact driven by price.

Turning now to hematologic oncology, where total revenues were $1.4 billion, with continued pressure on Imbruvica partially offset by robust double-digit growth with Fenclexta. Imbruvica global revenues were $878 million, down 25.2% due to increasing competition in

and the cumulative impact of a suppressed market. Van Clex to global sales were $538 million, up 17.5% on an operational basis, with strong momentum across both AML and CLL. In neuroscience, revenues were approximately 1.4% in 2019.

Jeffrey Ryan Stewart: This accelerated adoption among gastro neurologists is very encouraging for Rinvoke's pending outlook in Crohn's. We are currently launching this indication in the EU, a geography where Rinvoke is the only Jack approved to treat both IBD conditions, and we remain on track for CD approval and commercialization in the U.S. later this quarter, with broad formulae access anticipated to ramp quickly over the back half of this year. So we see inflammatory bowel disease continues to be an area of high unmet need; having two novel therapies in IBD, Skyrisi and Rinvoke, that each deliver differentiated levels of efficacy, is an important step forward for patients.

We are very pleased with the AMDD label and the launch, which has resulted in a significant uplift in total new prescriptions for RALAR.

With a dedicated sales force that calls on both psychiatrists and primary care, as well as ramping DTC promotion, we see an opportunity for accelerated growth across all approved indications, and we will be raising our full year guidance for Vrelar accordingly.

Within migraine, we remain uniquely positioned with a portfolio to support complete migraine freedom. Our leading oral CGRP therapies contributed $218 million in combined sales this quarter, reflecting growth of more than 45% as we continue to see strong prescription demand for both UBRLV and UBRLV.

Unknown Executive: And with these two complementary assets, we are very well positioned to compete against other oral or biological medicines. Global Humera sales were approximately $3. Down 24.3% on an operational basis due to biosimilar competition. Erosion in the U.

and Q-Lipta. We recently expanded the label for Q-Lipta, which is now uniquely positioned as the only oral CGRP available as a preventative treatment for patients, with both chronic and episodic migraine further strengthening our competitive profile.

Unknown Executive: With our expectations, most of the impact will be driven by price. Turning now to hematologic oncology, where total revenues were $1.4 billion, with continued pressure on imruvica, partially offset by robust double-digit growth with Fencsta. In Breivica, total revenues were $878 million, down 25% due to increasing competition and the cumulative impact of a suppressed market.

Lastly, total Botox therapeutic sales were $719 million, reflecting strong performance in chronic migraine, as well as other approved indications. So overall, I'm extremely pleased with the performance across the therapeutic portfolio, and with that, I'll turn the call over to Carrie for additional comments on aesthetics. Carrie?

Thank you, Jeff. First quarter global aesthetic sales were approximately $1.3 billion, which came in ahead of our guidance, primarily due to a faster reopening in China, as well as a slightly stronger economy in the U.S. versus our planning assumptions.

Unknown Executive: Vinclaxta global sales were $538 million, up 17.5% on an operational basis with strong momentum across both AML and CLA. In neuroscience, revenues were approximately $1. Up 15% on an operational basis. Braylar is performing exceptionally well.

In the U.S., aesthetic sales were $777 million, down 8.1% as we continue to see softness in aesthetic procedures related to inflationary dynamics. As a reminder, we saw very robust performance for our U.S. performance in the first quarter of 2022. For more information, visit www.usda.gov

which created a difficult comparison for growth in the first quarter of this year. US Botox Cosmetic sales were $409 million, down slightly on a year-over-year basis. We continue to see a lesser impact from inflationary dynamics on Botox Cosmetic compared to other areas of our aesthetic portfolio due to its relatively lower price point and large install base of loyal repeaters.

Unknown Executive: Sales of $561 million were up 31.3% on an operational basis, above our expectations. We are very pleased with the AMD label and the launch, which has resulted in a significant uplift in total new prescriptions for Ray Lott. With a dedicated sales force that calls on both psychiatrists and primary care, as well as ramping up DTC promotion, we see an opportunity for accelerated growth across all approved indications, and we will be raising our full-year guidance for Vralar accordingly.

18% as our thermal solar portfolio continues to be impacted by inflationary pressure on consumer spending.

The US filler market was down nearly 20% in the quarter on a year-over-year basis due to the persistent inflationary environment.

on our US dermal filler business is partially offset in the quarter by strong initial uptake for our recently launched Volux filler which is approved for the improvement of jawline definition. We expect Volux combined with the upcoming launch of our skin quality injectable skin beef to support long-term growth for our filler portfolio in the US. While the aesthetics category in the US continues to be challenged due to the fast economy

the key external economic metrics that we track have remained relatively consistent with year-end 2022 levels. Our international aesthetics portfolio continues to demonstrate robust growth, with strong performance in Japan, which is rapidly growing, and China, which is recovering faster than expected. Sales from our international aesthetics portfolio were 500 to 1,000,

Unknown Executive: Within migraine, we remain uniquely positioned with a portfolio to support complete migraine freedom. Our leading oral CGRP therapies contributed $218 million in combined sales this quarter, reflecting growth of more than 45% as we continue to see strong prescription demand for both Eubelvi and Cullip. We recently expanded the label for Culpta, which is now uniquely positioned as the only oral CGRP available as a preventative treatment for patients, with both chronic and episodic migraine further strengthening our competitive profile.

second largest market was negatively impacted by COVID in January and February but experienced a sharp recovery in March.

We expect this level of activity to be sustained throughout the remainder of the year.

Recall, our original guidance assumed we would not reach a full recovery until the second half of this year. And in Japan, which is an underdeveloped market and proving to be very responsive to promotion, we continue to make significant investment in injector training, our field force, and consumer education. For more information, visit www.fema.gov

Overall, we are pleased with how our team has been executing through this dynamic environment and remain encouraged by improving trends internationally and stabilization across our U.S. portfolio. These positive trends and continued strong momentum give us the confidence to increase the full year outlook for our aesthetic business.

Longer term, we remain extremely confident in our ability to grow the aesthetics business and continue to expect to achieve total sales of more than $9 billion by the end of this decade.

Aesthetics continues to be an extremely attractive, underpenetrated market, and our proven ability to drive consumer demand and develop a strong base of loyal customers, as well as bring innovative new products to the market, will support robust growth over the long term.

Unknown Executive: Lastly, total Botox therapeutic sales were $719 million, reflecting strong performance in chronic migraine, as well as other approved indications. So overall, I'm extremely pleased with the performance across the therapeutic portfolio, and with that, I'll turn the call over to Carrie for additional comments on aesthetics. Carrie?

With that, I will turn the call over to Tom. Thank you, Carrie. We have continued to make very good progress with our pipeline to start this year.

The immunology in immunology we recently received European approval for RIN, VOC and Crohn's disease Making it the first JAK inhibitor approved for this syndication We continue to anticipate FDA approval for RIN, VOC and Crohn's disease next month We also recently announced positive top-line results

Carrie C. Strom: Thank you, Jeff. First quarter global aesthetic sales were approximately $1.3 billion, ahead of our guidance primarily due to a faster reopening as well as a slightly stronger economy in the U.

from our phase three induction study for Skyrizzi in ulcerative colitis.

which is a disease with unpredictable symptoms and frequent players making it challenging to manage.

In our study, Skyrizzi met the primary and all secondary endpoints, demonstrating a very strong impact on the disease as measured by clinical remission, clinical response, and endoscopic improvement.

Carrie C. Strom: Aesthetic Sales for $77 million, down 8, to see softness. As a reminder, we saw very robust performance for our U.S. operations in the first quarter, creating a difficult comparison.

We're particularly pleased with Skyrizzi's impressive performance on the more stringent measures in this trial, with approximately 37% of Skyrizzi-treated patients achieving endoscopic improvement.

Carrie C. Strom: U. U. Votx Cosmetic Sales were $409 million down slightly on a, We continue to see a lesser impact from inflationary dynamics on Botox Cosmetic compared to other areas of our aesthetic it's relatively lower price point and large install base of loyal, The U, down low single- on a year-over Botox Cosmetic continues to be the clear market leader and its share of the U.S. Toxin Market, Sales for our U. Juven collection were down 8 Dermal Seller portfolio continues to be impacted by, U.S. market was down nearly 20, on a year-over-year basis due to Our Juvenorm Collection remains the clear market leader and share with stable, The economic pressure on our U.S. Dermal Filler business is partially offset in the quarter by strong initial uptake for a recently launched Volux Filler, which is approved for the improvement of jawline. We expect the Lux, combined with the upcoming launch of our skin quality injectable skin v, support long-term growth for our Filler portfolio While the aesthetics category in the U.S. continues to be challenged due to the Sastikana, external economic metrics that we track have remained relatively Our international aesthetics portfolio continues to demonstrate robust, strong performance in Japan, which is rapidly growing. China which is recovering faster than, Sales from our international aesthetic portfolio were $523 million, up 7.8% on an, International Botox cosmetic sales grew approximately 17. International Juvenorm Sales were down approximately.

compared to 12% of patients on placebo. This level of efficacy has the potential to position Skyrizi as a highly effective therapy, and we believe it will be a welcome new treatment option for physicians and patients once approved. Detailed data from this induction study will be present...

stages of our hematology and solid-tuber pipelines.

We remain on track for several important regulatory and clinical milestones this year.

including regulatory approval for eporitamab in the relapse refractory large B cell lymphoma.

Phase 3 data from Vanclexis Canova trial in real-ass refractory multiple myeloma patients with a T1114 mutation and Nebuloclaxes transform 1 trial in frontline myelofibrosis. And phase 2 data for telesovea and second line plus advanced non-squamous non-small lung cancer.

which has the potential to support a regulatory submission for accelerated approval.

We're also beginning to see very encouraging data.

for our next generation CMAT ADC, which uses a more potent topo payload than our TelesoV ADC. Based on the data we've seen to date for ABBV400 in our Phase 1 solid tumor basket study,

We plan to expand the program to earlier lines in colorectal cancer as well as evaluate in other tumors where CMAT is expressed.

including pancreatic and liver cancer. Moving to our neuroscience pipeline, where we've recently received FDA approval for Q-Lipta as a preventive treatment for patients with chronic migraine.

making it the only oral CGRP antagonist approved for prevention of both episodic and chronic migraine. In our Phase III study, Q-LifTA provided a significant reduction in migraine days as well as significant improvements in function and quality of life.

Tom Hudson: China, which is our second largest market, was negatively by COVID in January, but experienced a sharp recovery We expect this level of activity to be sustained throughout the, recall our original guidance assumed we would not reach a full recovery until the second And in Japan, which is an underdeveloped market and proving to be very responsible, to make significant investments, our field fourth, Overall, we are pleased with how our team has been, dynamic environment and remain encouraged by improving trends internationally and stabilization across our U, positive trends and continued strong momentum give us the confidence your outlook longer term, we remain extremely confident in our ability to grow to expect to achieve total of more than $9 billion by the, Aesthetics continues to be an extremely attractive, underpenetrated market, and our proven ability to drive consumer demand and develop a strong base of loyal customers, as well as bring innovative new products to the market will support robust growth over that I'll turn the call over Thank you, Kerry. We've continued to make very good progress with our pipeline to start this year. In immunology, we recently received European approval for Renn-Volk and Crohn's disease, making it the first jack inhibitor approved for this syndication.

in patients with chronic migraine, a common and debilitating disease. As a highly effective oral treatment option, we believe Q-Lipta will be well positioned in the chronic migraine prevention market. In Europe , we continue to anticipate an approval decision in the third quarter for atorjepant.

as a preventive treatment for patients with both chronic and episodic migraine. Turning now to ABB-951, we announced that we received a complete response letter for our regulatory application in the U.S.

The FDA has not asked for additional efficacy or safety studies related to our drug delivery drug device delivery system, but rather they have requested additional information regarding the pump.

as well as updates to instruction for use. We are working to generate the necessary information, and we expect to respond to the CRL later this year with an FDA action anticipated in the first half of 2024.

In international markets, we recently received approval for 951 in Japan, and we continue to expect approval in Europe in the fourth quarter of this year.

In our early stage neuroscience pipeline, we recently began phase 1 studies of our selective D3 dopamine receptor agonist, ABBV932. Our experience with Vrelar has highlighted the potential clinical benefit of achieving D3 selectivity, and we believe that a compound that more selectively engages the D3 dopamine receptor.

Tom Hudson: We continue to anticipate FDA approval for Wrenvoke and Crohn's disease next month. We also recently announced positive top-line results from our phase three induction study for Skyrisi in ulcerative collitis, which is a disease with unpredictable symptoms and frequent players making it challenging to manage. In our study, Skyrizi met the primary and all secondary endpoints, demonstrating a very strong impact on the disease as measured by clinical remission, clinical response, and endoscopic improvement.

has the potential to provide enhanced efficacy. Our program will initially focus on general anxiety disorder with the potential to expand to other neuropsychiatric disorders. The programs under our collaboration with Calico are also progressing well. We now have four assets in clinical trials, including two PTPN2 inhibitors in phase 1 in oncology......

our EIF2B activator for neurodegenerative diseases.

and an IGF-1 signaling pathway modulator that will be explored in aging-related diseases. Our most advanced program is the EIF-2B Activator 7262. The first patient was recently enrolled in the Healy ALS platform trial, a phase 2-3 study conducted by the Healy Center for ALS at Mass General.

Tom Hudson: We're particularly pleased with Skyrizi's impressive performance on the more stringent measures in this trial, with approximately 37% of Skyrizi-treated patients achieving endoscopic improvement, compared to 12% of patients on placebo. This level of efficacy has the potential to position Skyri as a highly effective therapy, and we believe it will be a welcome new treatment option for physicians and patients once approved. Detailed data from this induction study will be presented at a forthcoming medical meeting.

This trial is designed to evaluate multiple therapies simultaneously with a goal to accelerate the development of potential breakthrough treatments or ALFs.

Now I'd like to provide a brief update on two earlier stage programs in our therapeutic pipeline. In cystic fibrosis, we recently analyzed data from an ongoing proof of concept study evaluating our triple combination therapy. The results from this interim analysis...

Tom Hudson: We expect to see data from the Phase 3 maintenance study in the second quarter, with our regulatory submissions planned for the second half of the year. In oncology, we continue to make good progress across all stages of our hematology and solid tumor pipeline. We remain on track for several important regulatory and clinical milestones this year, including regulatory approval for Echoritamab in relapse-refractory large V-cell lymphoma. Baseway data from Vancel's Canova trial in real-lash refractory multiple myeloma patients with a T-11-14 mutation and nebitoclaxis transform one trial in front-line myelibrosis, and Phase 2 data for TIL-V and Second Line Plus in advanced non-squamous, non-small lung cancer, which has the potential to support a regulatory submission for accelerated approval.

did not meet our criteria for advancing, and we are discontinuing our cystic fibrosis program.

biomarkers that are consistent with systemic steroid exposure at the higher doses.

The benefit-risk profile does not sufficiently differentiate 154 from other available treatments.

Based on the totality of the data across RA, PMR, and Crohn's disease studies, we will not be pursuing further development of this asset. Moving to our aesthetics pipeline, we recently saw data from our Phase III studies for Botox Berlin.

in platysma prominence and masseter muscle prominence. In our study for prominent neck muscles, Botox met all primary and secondary endpoints.

demonstrating a significant reduction in the unwanted appearance of platysmal prominence on the neck and jawline.

This was the first of three phase three studies in platysmal provenance with data from the two remaining trials expected in the second half of the year.

followed by regulatory submission in the US near the end of 2023.

Tom Hudson: We're also beginning to see very encouraging data for our next generation CEMAT ADC, which uses a more potent topop payload than our TILA ADC. Based on the data we've seen to date for ABBF in our Phase 1 solid tumor basket study, we plan to expand the program to earlier lines in colorectal cancer, as well as evaluate it in other tumors with C-MET expressed, including pancreatic and liver cancer. Moving to our neuroscience pipeline, we recently received FDA approval for Calypta as a preventive treatment for patients with chronic migraine, making it the only oral CGRP antagonist approved for prevention of both episodic and chronic migraine.

Botox also performed very well in our study for prominent master muscles, meeting the primary and all secondary endpoints in the trial. Our program is initially focused on China and other Asian markets, as master prominence is common in Asian populations, and there's significant unmet need for the

for minimally invasive treatment options. Based on the results from this trial, we expect to submit our regulatory application in China in the second half of the year. Once approved, we will submit our regulatory application in China.

We anticipate high demand for Botox in this novel indication, which will help to further build our portfolio in a lower phase segment.

So in summary, we continue to demonstrate significant progress across all stages of our pipeline and anticipate numerous important regulatory and clinical milestones throughout the remainder of 2023.

With that, I'll turn the call over to Scott. Thank you, Tom. I will discuss our most recent financial results and guidance.

Starting with our first quarter results, we delivered strong top and bottom line performance.

We reported adjusted earnings per share of $2.46, which is 10 cents above our guidance midpoint.

Tom Hudson: In our phase three study, QLIFTA provided a significant reduction in migraine days, as well as significant improvements in function and quality of life in patients with chronic migraine, a common and debilitating disease. As a highly effective oral treatment option, we believe Culepta will be well positioned in the chronic migraine prevention market. In Europe, we continue to anticipate an approval decision in the third quarter for Toyjapan as a preventive treatment for patients with both chronic and episodic migraine.

These results include an 8 cent unfavorable impact from acquired IP R&D expense. Total net revenues were $12.2 billion, $400 million ahead of our guidance.

and down 8.3% on an operational basis, excluding a 1.4% unfavorable impact from foreign exchange.

The adjusted operating margin ratio was 45% of sales.

This includes adjusted gross margin of 84.2% of sales.

adjusted R&D investment of 13.6% of sales, acquired IP R&D expense of 1.2% of sales, and adjusted SG&A expense of 24.4% of sales. Net interest expense was $454 million. The adjusted tax rate was 13.7%.

Tom Hudson: Turning now to ABB-951, we announced that we received a complete response letter for our regulatory application in the U.S. The FDA has not asked for additional efficacy or safety studies related to our drug device delivery system, but rather, they have requested additional information regarding the pump, as well as updates to instructions for use. We are working to generate the necessary information, and we expect to respond to the CRL later this year with an FDA action anticipated in the first half of 2016.

Turning to our financial outlook, we are raising our full year adjusted earnings per share guidance to between $10.72.

and $11.12. This Earning for Sure guidance does not include an estimate for required IP R&D expense that may be incurred beyond the first quarter.

We now expect net revenues of approximately $52.4 billion, an increase of $400 million.

This guidance includes the following updated assumptions. We now expect regular sales of approximately $2.7 billion, an increase of $200 million, reflecting strong prescription growth following the MDD approval.

Tom Hudson: In international markets, we recently received approval for 951 in Japan, and we continue to expect approval in Europe in the fourth quarter of this year. In our early stage neuroscience pipeline, we recently began phase one studies of our selective D3 dopamine receptor agonist, ABBV 932. Our experience with VralR has highlighted the potential clinical benefit of achieving D3 selectivity, and we believe that a compound that more selectively engages the D3 dopamine receptor has the potential to provide enhanced efficacy. Our program will initially focus on general anxiety disorder with the potential to expand to other psychiatric disorders.

and stable economic trends in the US. Turning to the second quarter, we anticipate net revenues of approximately $13.5 billion.

to have a 0.6% unfavorable impact on sales growth.

We are forecasting an adjusted operating margin ratio of 48.5% of sales. We are modeling a non-GAAP tax rate of 15.4%. We expect adjusted earnings per share between $2.90 and $3.00.

Tom Hudson: The programs under a collaboration with Calico are also progressing well. We now have four assets in clinical trials, including two PTPN2 inhibitors in phase one in oncology, our EIF2B activator for neurodegenerative diseases, and an IGF1 signaling pathway modulator that will be explored in aging-related diseases. Our most advanced program is the EIF2B Activator 7262, and the first patient was recently enrolled in the Healy ALF platform trial, a phase 2-study conducted by the Healy Center for ALS at Mass General. This trial is designed to evaluate multiple therapies simultaneously with a goal to accelerate the development of potential breakthrough treatments for ALF.

This guidance does not include acquired IPR&E expense that may be incurred in the quarter. In closing, we are off to an excellent start to the year, with strong performance across the portfolio and financial results ahead of our expectations.

With that, I'll turn the call back over to Liz.

Thanks, Scott. We will now open the call for questions. In the interest of hearing from as many analysts as possible over the remainder of the call, we ask that you please limit your questions to one or two. Operator, first question, please.

Thank you. Our first question comes from Terrence Flynn with Morgan Stanley . Your line is open.

Great. Thanks so much for taking the question. Maybe two for me. Just on immunology, can you quantify the amount of destocking for both Skyrizzy and RINVOK in the quarter? I think Biogen on their call spoke to some tighter working capital requirements at wholesalers due to rising interest rates. So just wondering if you're seeing something similar here and just to want to be sure that's not a pricing dynamic.

Tom Hudson: Now I'd like to provide a brief update on two earlier stage programs in our therapeutic pipeline for cystic fibrosis. We recently analyzed data from an ongoing proof-of-concept study evaluating our triple combination therapy. The results from this interim analysis did not meet our criteria for advancing, and we are discontinuing our cystic fibrosis program. We have also recently reviewed interim data from our exploratory studies for ABV-154, NPMR, and Crohn's disease. Similar to results from the RA study, while we observed efficacy with 154, we also observed some changes in biomarkers that are consistent with systemic steroid exposure at a higher dose. The benefit-risk profile does not sufficiently differentiate 154 from other available treatments. Based on the totality of the data across RA, PMR, and Crohn's disease studies, we will not be pursuing further development of this aspect.

And then can you elaborate at all about your ALS program when we might see some data there? Thank you. Hi Terrence, it's Rob. So on the retail inventory stocking, we do typically see this in the first quarter, so it wasn't a complete surprise. In fact, it was factored into our guidance. We did beat our guidance and immunology for the quarter.

The impact was high single digits, both for SkyRISD and RINVOC. In terms of absolute value, you're talking about around $70 million for SkyRISD and $30 million for RINVOC.

And it's Jeff, just to clarify on the on your wholesale comment, I think as Rob highlighted, it's in the retail. So it's in the specialty pharmacy channel. And you recall, as you know, you know, there's about 18 specialty pharmacies that basically, you know, distribute the I&I products, and there's some big ones there. So it was not a wholesaler dynamic.

all approved indications as Jeff highlighted. We did have the two partial offsets, one being the retail inventory D stock which I've already quantified and then price was down high single digits and that's really driven by rebate increases which is typical when you see the type of volume increase and we saw you know skyrizzy sales up 80 percent last year, RINVOC in the US up 40 percent last year so when you see that kind of volume growth and couple that with the number of indications we had approved we had five new indications for RINVOC.

Tom Hudson: Now moving to our aesthetics pipeline, we recently saw data from our phase three studies for Botox in platisma prominence and masseter muscle promise. In our study for prominent neck muscles, Botox met all primary and secondary endpoints, demonstrating a significant reduction in the unwanted appearance of prominent neck muscles on the neck and jawline. This was the first of three phase three studies in Plotima Providence, with data from the two remaining trials expected in the second half of the year, followed by regulatory submission in the U.S. near the end of 2020. Botox also performed very well in our study for prominent master muscles, meeting the primary and all secondary endpoints in the trial.

early 25, all depends on the enrollment which I understand is starting off on a good pace. Thanks Terence. Terence operator, next question please.

Tom Hudson: Our program is initially focused on China and other Asian markets, as masseter prominence is common in Asian populations, and there's a significant unmet need for minimally invasive treatment options. Based on the results from this trial, we expect to submit our regulatory application in China in the second half of the year. Once approved, we anticipate high demand for Botox in this novel indication, which will help to further build our portfolio in the lower face segment.

Thank you. Our next question comes from Steve Scala with Cowen. Your line is open. Thank you. A couple questions. Some of your peers have called out copay resets early in the year that have led to more modest performances in products such as Dupixin and Cosentix. EVVY has been less vocal on this point. How much was that a factor or are Skyverzy and Rindvogue different in some way?

And then secondly, despite the solid performance in Q1, the EPS guidance range continues to be very wide. What factors would have to play out for you to hit the high end of that and the low end of that? Thank you.

Tom Hudson: So, in summary, we continue to demonstrate significant progress across all stages of our pipeline and anticipate numerous important regulatory and clinical milestones throughout the remainder of 20203. With that, I'll turn the call over to Scott. Thank you, Tom.

Hi, Steve. It's Jeff. Thanks for the question. I'll take the copay one. Look, some of the peers are seeing the effects of the so-called maximizer programs or even some of the lingering accumulator programs, which do sometimes as benefit designs are reset in the first quarter.

Scott T. Reents: I will discuss our most recent financial results and guidance. Starting with our first quarter results, we delivered strong top and bottom line results; we reported adjusted earnings per share of $2. 10 cents above our guidance mid- These results include an 8 cent unfavorable impact from acquired IPR&D. Total net revenues were $12. $400 million ahead of our guidance, and down 8.3% on an operational basis, excluding a 1.4% unfavorable impact from foreign exchange. The adjusted operating margin ratio was 45% of sales.

can apply some pressure. We don't see that. We've been managing that very tightly and we're not seeing any significant sort of surge or creep in terms of that dynamic. The dynamic is exactly what Rob had highlighted, which is the modest price based on the number of indications and how fast the volume is moving.

and this de-stocking event that we talked through. So, copay is very stable for AbbVie. And Steve, this is Rob on your EPS range question. We've typically given a 20 cent range. This year we gave a 40 cent range, and the key driver of that is, obviously, the U.S.-Humira dynamics. As we see that play out, particularly in the second half, we would typically tighten that range. Now, keep in mind, that 20 cent wider range represents about 1%.

Scott T. Reents: This includes adjusted gross margin of 84, adjusted R&D investment of 13.5% of sales, required IPR&D expense of 1.5% of sales, and adjusted SG&A expense of 24.4% of sales. Net interest expense was $454 million. The adjusted tax rate was 13.7%.

Scott T. Reents: Turning to our financial outlook, we are raising our full-year adjusted earnings-per-share guidance to between $10 and 72 cents and $11 and $12. This earnings for sure guidance does not include an estimate for acquired IPR&D expense that may be incurred beyond the first quarter. We now expect net revenues of approximately $52.4 billion, an increase of $400 million. At current rates, we expect foreign exchange to have a modest, unfavorable impact on full-year sales. This guidance includes the following updated assumptions. We now expect RELAR sales of approximately $2.

of US-Humera growth. So it's not as wide as you might think, but we did widen it given the dynamics with US-Humera and I think we'll be able to give you more color as we see those, you know, seven, nine biosummers coming in the market in the middle of the year. We'll have more clarity for you on the second quarter call.

Thank you. Thanks Steve. Operator, next question please. Our next question comes from Chris Schott with JP Morgan. Your line is open. Great, thanks so much. Just coming back to Skyrizzi and Rinvoke, I think you mentioned high single digit price erosion beyond just those inventory changes.

I guess is that a reasonable assumption to think about price as we progress through the rest of this year? And then maybe longer term should we think about that level of price erosion is more like a one-time kind of issue this year given all the new indications and a more stable trend going forward I'm trying to kind of get my hands around the pricing a little bit more and My second question was on the aesthetics business. You always saw a very strong one Q You just elaborate a little bit more on your confidence

Scott T. Reents: $2. An increase of 200 million, reflecting strong prescription growth following MDD approval. For aesthetics, we now expect global revenue of approximately $5, reflecting the better than expected recovery in China and stable economic trends in the U. Turning to the second quarter, we anticipate net revenues of approximately $13, which includes U. U. U. Humera erosion of 27%. At current rates, we expect foreign exchange to have a 0.6% unfavorable impact on sales. We are forecasting an adjusted operating margin ratio of 48, and we are modeling a non-gap tax rate of 15. We expect adjusted earnings per share between $2 and $0.

in the sustainability of these trends. I know the market's been a little bit bumpy, but it seems like the tone is that you're encouraged with the trends you're seeing, but just how much visibility you have in terms of sustainability of those favorable international trends we're seeing right now? Thank you. So Chris, this is Rob. So on your question on price, yeah, the way to think about 2023 price for the year for SkyRizian run book would be down high single digits.

Now we wouldn't expect high single digits to be the rate going forward given a big driver were the number of new indications that we launched. So I would expect that to moderate over time.

Scott T. Reents: This guidance does not include acquired IPR&E expense that may be incurred in the quarter. Overall, we're off to an excellent start to the year, with strong performance across the portfolio and financial results ahead of our expectations. With that, I'll turn the call back over to Liz. Thanks, Scott. We will now open the call for questions. In the interest of hearing from as many analysts as possible over the remainder of the call, we ask that you please limit your questions to one or two. Operator, first question, please.

Hi this is Carrie. In terms of your questions around the aesthetics market there are two key assumptions for the 2023 planning. One was around the US economy and the other was around the recovery in China. You think about the US economy we look at Q1 and we see some favorability to our planning assumptions with the metrics that we track which Rob mentioned include real personal consumption expenditure and Google.

So in January and February , we saw favorability there, although in March there are some potential signs of softening. So we continue to have a cautious outlook for our US business for the rest of the year. The way to think about market growth for the full year would be low for toxins.

Operator: Thank you. Our first question comes from Terrence Flynn with Morgan Stanley. Your line is open.

The market would be down low to mid single digits until we lap the 2022 downturn, which happened around May. And then after that, we would expect flat market growth for the rest of the year. So that's how we think about the US. Our other, our second biggest market is China. And recall, we had assumed that the aesthetics market in China would not fully recover until the second half of the year. For more information, visit www.cpe.rutgers.gov

Terence Flynn: Great. Thanks so much for taking the question. Maybe two for me.

Unknown Executive: Just on immunology, can you quantify the amount of de-stocking for both Skyrizi and Renvoke in the quarter? I think Biogen on their call spoke to some tighter working capital requirements at wholesalers due to a rise in interest rates. So just wondering if you're seeing something similar here and just want to be sure that's not a pricing dynamic. And then can you elaborate at all about your ALS program so that we might see some data there? Thank you. Hi Terrence, this is Rob.

Well, in actuality, what we saw was although January was significantly impacted, in February we started to see improvement and in March there was a really steep recovery that we do expect will sustain through the rest of the year.

And in other markets around the world, I guess in Canada and UK, we are seeing some high inflation impacting consumer demand, but the rest of Europe seems stable right now.

Robert A. Michael: So on the retail inventory de-stalking, we do typically see this in the first quarter, so it wasn't a complete surprise. In fact, it was factored into our guidance. We did beat our guidance and immunology for the quarter. The impact was high single digits, both for Skyrizi and Renvoke.

Thank you, Chris. Operator, next question, please. Operator, next question comes from Mohit Bansal with Wells Fargo. Your line is open.

Great, thanks for taking my question. I have one clarification and one question. So, clarification is regarding the price decline for INI, you said that high single digit, but should we assume, like going forward, year over year versus volumes, should we assume high single digit decline still going forward for at least for the quarter?

Robert A. Michael: In terms of absolute value, you're talking about around 70 million for Skyrizi and 30 million for. And it's Jeff. Just to clarify on your wholesale comment. I think, as Rob highlighted, it's in retail. So it's in the specialty pharmacy channel. And you recall, as you know, there's about 18 specialty pharmacies that basically sell I&I products, and there are some big ones there. So it was not a wholesaler was retail inventory dynamic, which again, as these products get bigger, we do in our process.

and then more stable pricing quarter over quarter term, just that clarification. And the question is, regarding the INI pipeline, so you have a leadership position with SkyRizian and Invoke and they are growing, but some of the pipeline products like 154 and 157 did not pan out as you were hoping them to.

How should we think about the pipeline strategy beyond these two products? And can you even do M&A given the increased FTC scrutiny nowadays? Thank you.

Robert A. Michael: And then, Terrence, this is Rob, just to more broadly answer the question that I'm sure many investors have. If you look at the growth in the quarter, overall U.S. demand was up just north of 60% for Invoke and SkyRizu. And we saw a very strong performance across all approved indications, as Jeff highlighted.

So this is Rick. I'll cover number two and maybe just touch on number one. Um.

If you think about our pipeline, obviously as we look at Skyrizzi and Lindvog, they clearly have restated the immunology market across most of the segments that we operate in. We view those assets as being able to drive strong growth.

through the early part of the next decade. Having said that, we're continuing to look for assets in areas where we believe there's still a significant opportunity to restate a standard of care.

Robert A. Michael: We did have the two partial offsets, one being the retail inventory de-stock, which I've already quantified, and then price was down high single digits, and that was really driven by rebate increases, which is typical when you see the type of volume increase. And we saw, you know, SkyRizzi sales up 80% last year, and Rinvoke in the U.S. up 40% last year. So when you see that kind of volume growth and couple that with the number of indications we have approved, we have five new indications for Renvoke and two for Skyrizi.

And we obviously explore, as everyone in this industry does, many different assets and different mechanisms to try to find those kinds of mechanisms that will deliver that kind of performance. It's interesting when you look at the 154 platform, it did exactly what we thought it would do from the standpoint of efficacy.

But it did it in a way only at the highest dose. And at that highest dose, we did see it, some effects of steroids on some of the biomarkers. And based on the way we think regulators would look at a label for those kinds of products, we didn't believe that would be a competitive profile.

the hypothesis certainly worked around the mechanism. So we continue to look for opportunities. We have lots of runway here to be able to get to those but we do desire to find some additional mechanisms that will be the follow-on products.

Robert A. Michael: So it was something we were contemplating. It was factored into our guidance, but I don't know that the street fully appreciated that in terms of the first quarter estimates that were put out. This is Tom for the ALS question. I'd say about two years. We have to recruit the patients, and there's about a year of follow-up that is needed, so I'd say late 24, early 25.

Tom Hudson: All depends on the enrollment, which I understand is starting off at a good pace. Thanks, Terence. Terence operator, next question, please.

Operator: Our next question, Scala with Cowan, your line is open. Oh, thank you. A couple of questions. Some of your peers have called out copay resets early in the year that have led to more modest performances and products such as DuPixin and Cosentix. AVee has been less vocal on this point. How much was that a factor, or are Skyrazi and Rindvoke different in some way?

Steve Scala: And then secondly, despite the solid performance in Q1, the EPS guidance range continues to be very wide. What factors would have to play out for you to hit the high end of that and the low end of that? Thank you. Yeah, hi, Steve, it's Jeff, and thanks for the question. I'll take the co-pay one.

Jeffrey Ryan Stewart: Look, I mean, some of the peers are seeing the effects of the so-called maximizer programs or even some of the lingering accumulator programs, which sometimes, as benefit designs are reset in the first quarter, can apply some pressure. We don't see that. We've been managing that very tightly, and we're not seeing any significant sort of surge or creep in terms of that. The dynamic is exactly what Rob had highlighted, which is a modest price based on the number of indications and how fast the volume's moving and this de-stocking event that we talked through.

Jeffrey Ryan Stewart: So co-pay is very stable after. Steve, this is Rob on your EPS range question. We've typically given a 20 cent range this year; we gave a 40 cent range, and the key driver for that is, obviously, the U.S. Humera. As we see that play out, particularly in the second half, we would typically tighten that range.

you'll start to see some picking off of patients from those two brands to buy Similars in the second half of the year. Thank you.

Robert A. Michael: Now, keep in mind, you know, that 20-cent wider range represents about 1% of U.S. American growth. So it's not as wide as you might think, but we did widen that given the dynamics with U.S. Humara, and I think we'll be able to give you more color as we see, you know, seven, nine, summer's coming into the market in the middle of the year. We'll have more clarity for you on the second quarter call. Thanks, thank you, Steve.

Yeah, hi, it's Jeff. I'll give some comment on that. I think the way that we think about our brands is the first place that we look at is how distinctive they are. I mean, we've got four head-to-head trials with Skyrizzi and another one on the way where we can clearly differentiate the product. And we have many as well on RINVOGUE. So we've really thought about it from a development standpoint.

And I would say, you know, the perspective is somehow there was a restructuring of the PDMs, which I don't think is imminent. And the rebate sort of approach disappeared. It disappears for everybody. I mean, all of these I&I products have a fairly reasonable rebate load, and there'd be a different basis of competition, which we would do very, very well.

Operator: Operator, next question, please. Our next question comes from Chris Schott with JPM. Your line is open. Great, thanks so much.

Chris Schott: Just coming back to Sky Rizzi and Rinvoke, I think you mentioned high single-digit price erosion beyond just those inventory changes. I guess there's a reasonable assumption to think about price as we progress through the rest of this year and then maybe longer term. Should we think about that level of price erosion as more like a one-time kind of issue this year, given all the new indications and a more stable trend going forward? I'm trying to kind of get my hands around the pricing.

don't see that there are going to be significant impacts of Humira biosimilars on the performance of Skyrizi and Rinvoke. And one perspective, let's take Rinvoke is sort of a very simple way of thinking about it. It's already in the United States step behind TNF.

Robert A. Michael: a little bit more. And my second question was just on the aesthetics business. You obviously saw a very strong one, cue.

Carrie C. Strom: You can just elaborate a little bit more on your confidence in the sustainability of these trends. I know the market's been a little bit bumpy, but it seems like the tone is that you're encouraged by the trends you're seeing, but just how much visibility you have in terms of the sustainability of those favorable international trends we're seeing right now. Thank you. Chris, this is Rob.

and it's performing at that level because you see such expansion of second and third lines in that space. And Skyrizzi is very, very distinctive. So no, in the second half we do not anticipate sort of a knock-on effect of the emergent biosimilars to our two core brands.

Operator, next question, please. Thank you. Our next question comes from Carter Gould with Barsclay. Your line is open. Great. Good morning. Thanks for taking the question. Maybe a different spin on the B question there, just given the volatility in the marketplace as you have those conversations or engage with potential

Robert A. Michael: So on your question about price, yeah, the way to think about 2023 price for the year for Skyruzian Roan Vogue would be down high single digits. Now, we wouldn't expect high single digits to be the rate going forward given a big driver were the number of new indications that we launched. And so I would expect that to moderate. Hi, this is Carrie.

If you've seen a shift in that bid ask spread and the willingness of boards and management to consider deals, any updates on that front would be helpful.

Carrie C. Strom: In terms of your questions around aesthetics, there are two key assumptions for the 2020s around the U. And the other is around the recovery think about the U. We look at Q1, and we see some favorability to our planning assumptions, which Rob mentioned include real personal consumption expenditure and Google. So in January and February, we saw favorability there, although in March there are some potential signs of. We continue to have a cautious outlook for our U.S. business for the rest of the year.

This is Rick.

I'd say the environment hasn't changed materially in the last, you know, 24 months from my perspective.

You know, I still think it's certainly more difficult to raise money for biotech companies. So it probably makes them a bit more willing to engage with players like us or engage in a process if they're at a point where they've generated data that makes them attractive.

Carrie C. Strom: The way to think about market growth for the full year would be, for toxins, the market would be down low to mid single digits until we lap the 20-22 downturn, which happened around May. And then after that, we would expect flat market growth. So that's how we think about the U.

Carrie C. Strom: Our other, our second biggest market is China. And recall we had assumed that the ascetics market in China would not fully recover until the second half of the year. Well, in actuality, what we saw was, although January was significantly impacted, in February, we started to see improvement, and in March there was a really steep recovery that we do expect will sustain through 30. And in other markets around the world, I guess in Canada and the UK, we are seeing some high inflation impacting consumer demand this year and the rest of the year. Thank you, Chris.

Operator: Operator, next question, please. Our next question comes from Mohit Vansel with Wells Fargo. Your line is open. Great, thanks for taking my question. I have one clarification and one question.

Mohit Bansal: So, clarification is regarding the price decline for I&I, you said that high single digit, but should we assume, like, going forward, year over year, we should, versus volumes, should we assume a high single digit decline still going forward for, at least for us, for the quarters, and then more stable pricing quarter over quarter term. Just that clarification. And the question is, regarding the I&I pipeline, so you have a leadership position with Skyrisian, and they are growing, but some of the pipeline products like 154 and 157 did not pan out as well as you were hoping they would. So what should we think about the pipeline strategy beyond these two products? And can you even do MNA given the increased FTC scrutiny nowadays? Thank you. So this is Rick.

Rick Gonzalez: I'll cover number two and maybe just touch on number one, our pipeline. Obviously, as we look at Skyrizi and Limboke, they clearly have the immunology market across most of the segments that we operate in. We view those assets as being able to drive strong growth through the early part of the next decade. Having said that, we're continuing to look for assets in areas where we believe there's still a significant opportunity to improve standards of care.

Indication, where we have breakthrough therapy designation.

The end of this year I would say, that's where we would see a readout what we've seen in <unk>.

Earlier data cuts.

Or are above 50%, which is quite a bit higher than what would be expected in standard of care in that second and third line setting.

Setting and if the data looks strong there is a potential that we could submit next year for an accelerated approval.

Thanks Scott.

Okay.

I'll take the second question and maybe I'll make a little bit of a comment on <unk> because I think.

You mentioned 400, I think the early data that we're seeing in 400 is impressive to US. There's no question about it and I think we're going to have some data presented at this <unk> right, where you'll have an opportunity to see that and CRC.

Rick Gonzalez: And we obviously explore, as everyone in this industry does, many different assets and different mechanisms to try to find those kinds of mechanisms that will deliver that kind of performance. It's interesting that when you look at the 154 platform, it did exactly what we thought it would do from the standpoint of efficacy. But it did it in a way only at the highest dose, and at that highest dose, we did see some effects of steroids on some of the biomarkers. And it is based on the way we think regulators would look at a label for those kinds of products.

Now, having said that to Lisa as Rupert said does get very good responses in and seen that highs, but to get a broader set of C. Met population do you believe you need to move to the total warhead. It seems to give deeper responses more durable responses.

Data has to play out over time, but it appears to be.

A very good platform for seeing that.

So we need the data mature and we need to develop more data in that area, but I'd say the early data is pretty encouraging and you'll have a chance to see a snippet of that this <unk>.

Last year.

Well in succession, we obviously have a process in place we are very experienced board.

Rick Gonzalez: We didn't believe that would be a competitive profile. But the hypothesis certainly works around the mechanism. So we continue to look for opportunities. We have lots of runway here to be able to get to those, but we do desire to find some additional mechanisms that will be the follow-on products that should be introduced, hopefully, near the end of this decade or early into the next decade, as the next generation immunology assets for ABB.

I've had many many discussions with the board about succession.

A successful and smooth transition the criteria that were operating against is we need to completely get through the transition.

For Humira Biosimilars here in the U S. I'd say, so far I'm very pleased with how the transition is going and I'm, even more pleased with the way the growth.

Rick Gonzalez: So, and I feel good about the progress that we're making there. We're continuing to explore a number of other areas, and we're continuing to look both internally and externally at different assets that we can bring into the company to be able to do that. To your question of being able to bring assets into this market, we don't believe that we would be encumbered because Immunology is a very crowded space from a competitive standpoint, and that's one of the most important criteria that you look at from an FTC standpoint. So we believe we have freedom to operate across most of those segments from an FTC standpoint as well.

And much of the pressure on improvement goes starts to subside, we should see that growth rate increased significantly as we move into 'twenty four for the growth the growth platform and obviously returned to robust growth in 2005 and deliver high single digit from that point forward. So that's the expectation.

We can make a successful transition I've also told the board that I'm willing to stay in and capacity that they would desire deliberate length of time. They would I think the expectation right now is that.

Rick Gonzalez: And on price, maybe Rob and I will tag team this one to make sure it's clear. It is common that when you go out and you add indications in this industry, when you negotiate those contracts to be able to get access, it does require some level of price concession. I would say we're on the lower end of what you typically would have seen with the speed at which we got access to Skyrisi and Rinvote for those indications and the breadth of that access.

For a period of time to finish the transition to the new CEO .

Rick Gonzalez: And so you certainly would expect this year and last year to be the areas where you saw the most significant amount of price increases because those are the years that we had the majority of the indication. But you would expect that to moderate.

Rick Gonzalez: So then going forward, the way to think about it is that it's only really driven by volume at that point. And volume typically requires much more modest kinds of price as you go forward. It's not zero price. You shouldn't have that expectation.

Yes, Hi, it's Jeff I'll take your.

As I mentioned.

The share is very very impressive. So we have a 30% total market share now, which is really putting significant headroom against any other drug in that category by a lot and one way to think about it is I think what youre asking is how much how much further can it run and it can run.

Rick Gonzalez: But I would not have an expectation of a high price. single digits going for. Anything you add, Rob? Just to answer the question, Mohead, on the gate. Yeah, I think it's safe to assume that you'll see high single-digit prices in each of the, helpful. Thank you. Thank you, Moit.

Quite a bit further to some degree if you think about it so we're capturing on the dynamic share roughly 50%. So one out of every two patients in our market shares about 30, so theoretically over time right unless theres, some disruption, which we don't see significant disruption in the market. Your total market share is going to move towards that in.

Operator: Operator, next question please. Our next question comes from Tim Anderson with Wolf Research. Your line is open. Hi, thank you for taking our questions. This is Alice Nettleton with Tim Anderson.

Alice Jennifer Nettleton: So a question on PBMs, which are under renewed scrutiny: if there were material changes to the rebating structure currently in place, would that put big incumbent products at risk because it might remove the so-called rebate wall? And more generally, do you think there is any chance of some of the proposed legislative changes actually happening? law, and then secondly, any collateral impact you're seeing on Skyris or Invoke since Humero biosimilars have launched. Given the overlapping indications, do you think that you'll start to see some patients being switched from those two brands to biosimilars in the second half of the year? Thank you. Yeah, hi, it's Jeff.

Play share now that takes many many years, but as we look at the fundamental momentum that we can achieve its still very very significant add onto that that basically we're still in the in the rest of the world starting to really see the PSA ramp and remember PSA has a very significant impact because it's <unk>.

Treated by <unk>.

Terms and it was sort of the last remaining gap that we had so youre going to see continued momentum in the international markets in the U S market.

And we.

We have a long way to run and I'd be remiss, if I didn't say how fast again that we're growing in both crohn's right now and very exciting data in UC and that market is very very dynamic. So we feel very secure in our ability to continue to create a lot of value with sky rosy.

Jeffrey Ryan Stewart: I'll give some comment on that. I think the way that we think about our brands is the first thing that we look at is how distinctive they are. I mean, we've got four head-to-head trials with Skyrizi and another one on the way where we can clearly differentiate the product. And we have many as well with Renvoke.

Hi, This is Tom regarding the question on <unk>.

Flood program.

<unk> character that we just did not work this was not our first attempt at producing one and we do not have another backup. So we don't have another other options and to discontinue the CF program.

Jeffrey Ryan Stewart: So we've really thought about it from a development system point of view. And I would say, you know, the perspective is that somehow there was a restructuring of the PDMs, which I don't think is imminent, and the rebate sort of approach disappeared. It disappeared for everybody. I mean, all of these I and I products have a fairly reasonable rebate load, and there would be a different basis of competition, which we would do very, very well

Okay, great. Thank you.

Thanks, Evan Operator next question please.

Thank you.

Our next question comes from Trung Nguyen with Credit Suisse. Your line is open.

Hi, Good morning. This is Carson on for <unk>. Thanks for the question just on improve how confident are you.

Seven Chemo guide given the significant competitive pressure there I mean, I understand Perkins I didn't particularly have legs in the U S until late January what level of pricing pressures can we expect through the year and is there the potential for further step down in your guide for later in the year and if you do do that could be pushed out given the delay with nine five.

Jeffrey Ryan Stewart: So we're not concerned about, you know, sort of a fundamental structural change between these two products, which are very If we look at your second part of your question, which is it's really the same answer, which is we don't see that there are going to be significant impacts of Humera-Biolimilars on the performance of Skyrisian and Rinvoke.

I have one as well.

Yes, Hi, it's Jeff <unk>.

I think we think that's a very good call and just as a as a reminder, we're not seeing significant pricing pressure in the market. This is really two effects, which is one the cumulative effect as we've highlighted over the suppress market over time, which looks to be normalizing actually for the first time in three years, we add.

Jeffrey Ryan Stewart: And one perspective, let's take Rinvoke, is sort of a very simple way of thinking about it. It's already in the United States, a step behind TNF, at that level because you see such an expansion of the second and third lines in that space, and Skyri's very, very distinctive.

We saw a positive.

Growth in the market. So that's encouraging the big driver is the share is the new patient share which has been under pressure.

Jeffrey Ryan Stewart: So no, in the second half, we do not anticipate sort of a knock-on effect of the emergent biosimilers to our two-quins. Thanks, Alice. Operator, next question, please. Thank you.

Actually under pressure by calc wins, certainly from our own <unk> and then the recent Peru, Kinzel wash and so when we when we put all of that into the into the calculus. We think we've got it right.

Operator: Our next question comes from Carter Gould with Barth Clay's. Your line is open. Great, good morning, thanks for taking the question. Maybe a different spin on, and they're just given sort of the volatility in the marketplace as you kind of, you know, have those conversations or engage with potential, you know, targets, just if you've seen a shift in sort of that bid-ask spread and the willingness of boards and management to consider deals. Any updates in that front would, This is Rick. I'd say the environment hasn't changed materially in the last, you know, 24 months from my perspective.

And it's probably unlikely that we're going to see.

Any any significant step down that would put that in jeopardy.

Allison This is Rob I'll answer your second question. So I wouldn't consider improve kind of 95, one to be variables that would push the trough out it's really more about how the overall year plays out, particularly the second half with U S. Humira. So if U S. Humira does better and we outperformed in 'twenty three and we could see the trough in 'twenty four I think the important thing.

Keep in mind is regardless of when the trough occurs we wouldnt expect earnings to fall below the $10 70 floor <unk>, that's really what what I would focus on and we don't consider Aruba kind of 95, one delay to be variables that would push that trough.

Carter Lewis Gould: I still think it's certainly more difficult to raise money for biotech companies, so it probably makes them a bit more willing to engage with players like us or engage in a process if they're at a point where they've generated data that makes them attractive. But I'd say the interest level in that engagement is similar to what it has been for the last 12 to 24 months. And there are a lot of opportunities to be able to find, you know, assets that are in the biotech area.

Thanks Carsten.

Cognizant of a number of peers reporting today and so in the interest of time, we have one last question.

Our last question comes from Geoff Meacham with Bank of America. Your line is open.

Hi, This is Susan on for Geoff Meacham, we had a follow up on <unk>.

Do you guys expect any changes to your outlook following mcl MTL withdrawal.

Carter Lewis Gould: The question is, you have to find the right kind of asset, and you have to find one that's attractive and it meets your needs. And I'd say being able to negotiate a transaction is, I think, a reasonable probability. I'd say prices are still relatively high, and so valuations for good assets tend to go at a pretty high level. So, again, it's got to be an asset that can demonstrate that it's going to provide significant value to justify that kind of a valuation and a return.

And then do you expect any read through to Follicular lymphoma.

Carl.

Yes, Hi, it's Jeff. Thank you for the thank you for the question.

First these are these are very small indications so to give you some sense of the relative size for <unk>.

Mcl is about 4% of the value Mcl is really less than a percent about a percent. So.

So we don't anticipate that.

Those withdrawals due to the fact that we didn't get the confirmatory studies to clear we will have a material impact I think it's also important to note that.

Carter Lewis Gould: But, you know, we continue to look for opportunities, and I think. And, you know, as we find those kinds of opportunities, as I said in the past, we're certainly going to pursue them. Thanks, Carter. Operator, next question, please. Our next question comes from Vamol-Divon with Guggenheim Securities. Your line is open. Great, thanks.

Many physicians will continue these patients on the medication they won't be all switched for example, or taken off and put on another product.

That's the market intelligence, there's no requirement that they need to do that for the physicians and so net net this is this is not a really material.

Issue given the size of those indications and I think ruble will address your point on Follicular I can talk about FL here for a minute so.

Operator: Great, thanks for taking the questions. Maybe a couple from me as well.

Vamil Kishore Divan: So one, just a couple of data points you have coming up this year that I think may be a little bit less focused on are Neviticlax and Talisa V. So maybe you can just sort of frame what we should be looking for, what your expectations are, what you're hoping to see from those assets, especially Talisa V given your comments on the next-gen ABB-B-V-400. And then the other question, I guess, would be for Rick, and more on succession planning.

Phase III readout is expected later this year.

It's not clear if the mcl.

Comes wood.

We've reflected in what we see there.

<unk>.

Mono therapy or in combinations, which we will see some data in those combos and <unk> and FL at.

Vamil Kishore Divan: I know we talked, you mentioned before that your plans to stick around through the Humera event. I'm just wondering if you have any sort of updated thoughts on timing on that. Now, the words, we're sort of in the middle of this process. We've been getting questions there, too, is this something we should expect some sort of announcement this year, or is it more, you know, you're looking for 2024 or later? Thank you.

At <unk> as well.

Thank you for your participation participants you may disconnect at this time.

Yes.

Roopal Thakkar: Hi, it's RuPaul. I'll take the ones on Navidiclax and Talisa. So for Neviticlax, it's the combination with Jack 2 and myelofibrosis, and there we're looking to be better than monotherapy with Jack 2 in that space, improving spleen size and symptoms like abdominal pain, fullness, and fever fatigue. Also, perhaps uniquely, what we've observed is an improvement in bone marrow fibrosis, and a decrease in variant, elilic frequency. So that's what we would be looking for, and we should get a readout by mid-year or so. For Toliso V, in lung cancer, EGFR Wild Type with high CET, and that's the indication where we have breakthrough therapy designation.

Roopal Thakkar: Around the end of this year, I would say that's where we would see a readout. What we've seen in earlier data cuts is an ORR above 50%, which is quite a bit higher than what would be expected in standard of care in that second, third line setting, and if the data looks strong, there's a potential that we could submit next year for an, I'll take the second question. And maybe I'll make a little bit of a comment on Talisa V because I think you mentioned 400.

Roopal Thakkar: I think the early data that we're seeing in 400 is impressive to us. There's no question about it. And I think we're going to have some data presented at this ASCO, right, where you'll have an opportunity to see that in CRC. Now, having said that, Talisa V, as Ruckel said, does get very good responses in CME at High. But to get a broader set of CET population, we do believe you need to move to the Topo Warhead. It seems to get deeper responses and more durable responses.

Rick Gonzalez: That data has to play out over time, but it appears to be a very good platform for C. And so we need the data to mature, and we need to develop more data in that area, but I'd say the early data is pretty encouraging, and you'll have a chance to see a snippet of that at this ASCO. As far as leadership changes are concerned, I'd say it's similar to what we said in either the first quarter or fourth quarter last year. I can't recall, however, about succession. We obviously have a process in place. We have a very experienced board. I've had many, many discussions with the board about succession.

Rick Gonzalez: The board knows I'm committed to be here to ensure a successful and smooth transition. The criteria that we're operating against is we need to completely get through the transition for Humera, biosimilers, here in the U.S., I'd say so far, I'm pleased with how the transition is going, and I'm even more pleased with the way the growth platform is operating right, And in fact, if you look at it this year, the growth platform is going to deliver mid single digits and is going to do it despite the headwinds that we see on in Bruvica, and the headwinds that we're seeing from the economy on aesthetics.

Rick Gonzalez: Once the aesthetics business returns to its normal growth rates, and much of the pressure on imbubica starts to subside, see that growth weight increase significantly as we move into 24 for the growth platform, and obviously, we're turning to robust growth in 25 and delivering a single digit from that point forward. So that's the expectation that we're working to, so we want to make sure that the business is operating the way we want it to.

Rick Gonzalez: We want to make sure that we're through the biosimilar erosion to the point that we believe it is predictable. And then, obviously, the second part of the criteria is ensuring that the candidate that will succeed me is ready to do that.

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Rick Gonzalez: We can make a successful transition. I've also told the board that I'm willing to stay in any capacity that they would desire for whatever length of time they want. I think the expectation right now is that I would assume the executive chairman role for a period of time to finish the transition to the new CEO. You should not be expecting that that transition is going to occur on the 20th.

Operator: Thanks, Fommel, operator. Our next question comes from Evan Sigerman with BMO Capital Markets. Your line is open.

Evan Seigerman: Hi guys. Thank you so much for taking the time to answer my question. Just on kind of Sky Rizzing and some of the dynamics you're seeing there, can you characterize kind of how you're thinking about further penetration in the psoriasis indication, kind of some puts and takes in the dermatology market? Just a follow-up on the CF program, is it safe to assume that you're totally done investing in this area, or do you have other assets, kind of an earlier development that could emerge? Thank you. Yeah, hi, it's Jeff.

Jeffrey Ryan Stewart: I'll take your..., your comment on psoriasis. I think that, as I mentioned, the share is very, very impressive. So we have a 30% total market share now, which is really giving significant headroom against any other drug in that category by a lot. And one way to think about it is, I think what you're asking is how much further it can run. And it can run quite a bit further.

Jeffrey Ryan Stewart: To some degree, if you think about it, we're capturing roughly 50% of the dynamic share, so one out of every two patients, and our market share is about 30%. So theoretically, over time, right, unless there's some disruption, which we don't see significant disruption in the market, your total market share is going to move towards that in-play share. Now, that takes, you know, many, many years, but as we look at the fundamental momentum that we can achieve, it's still very, very significant, add to that that basically we're still in the rest of the world starting to really see the PSA ramp.

Jeffrey Ryan Stewart: And remember, PSA has a very significant impact when treated by derms, and it was sort of the last remaining gap that. So you're going to see continued momentum in the international markets and the U.S. market, and we have a long way to go. And I'd be remiss if I didn't say how fast we're growing in both Crohn's right now and have very exciting data in UC. And that market is very, very dynamic.

Jeffrey Ryan Stewart: So we feel very secure in our ability to continue to create a lot of value. Hi, this is Tom regarding the question about our triplet program. Yeah, the C2 corrector that we just tested did not work. This was not our first attempt at producing one, and we do not have another backup, so we don't have any other options than to discontinue the CF program.

Tom Hudson: Thanks, Kevin. Operator, next question please. Thank you. Our next question comes from Chung-Wen with Credit Suish. Your line is open.

Operator: Hi, this is Carson Arpertrung. Thanks for the questions. Just on in Bruvica.

Chung-Wen: and in Bruvica, how confident are you about the 5.7 T-Mong guide, given the significant competitive pressures there? I mean, I understand, Rikinsa did not particularly have legs in the U.S. until late January.

Jeffrey Ryan Stewart: What level of pricing pressures can we expect through the year, and is there the potential for further step-down in your guide for later in the year? And if you do do that, could the trough be pushed out, given the delay with 951 as well? Thanks.

Jeffrey Ryan Stewart: Yeah, hi, it's Jeff. And, you know, I think we think that's a very good call, and just as a reminder, we're not seeing significant pricing pressure in the market. This is really two effects, which is one, the cumulative effect we've highlighted over the suppressed market over time, which looks to be normalizing. Actually, for the first time in three years, we actually saw positive growth in the market, so that's encouraging. The big driver is the shape.

Jeffrey Ryan Stewart: is the new patient share, which has been under pressure, initially under pressure by Calquence, certainly from our own Van Klexta, and then the recent Brukinza launch. And so when we put all of that into the calculus, we think we've got it right, and it's probably unlikely that we're going to see, you know, any significant step down that would lower that in general. Arson, this is Rob. I'll answer your second question.

Robert A. Michael: So I wouldn't consider variables that would push the trough out. It's really more about how the overall year plays out, particularly the second half with U.S. Humera. So if U.S. Humera does better and we outperform in 23, then we could see the trough in 24. I think the important thing to keep in mind is regardless of when the trough occurs, we wouldn't expect earnings to fall below the 1070 floor XIPRD. That's really what I would focus on, and we don't consider Bruvica in the 951 delay to be variables that would push that. Thanks Carson.

Operator: We're cognizant of a number of peers reporting today, and so in the interest of time, we have time for one last question. Our last question comes from Jeff Meacham with Bank of America. Your line is open.

Geoff Meacham: Hi, this is Susan on behalf of Jeff Meacham. We had a follow-up visit in Brubica. Do you guys expect any changes to Outlook following MCL-MDL withdrawal? And then, do you expect any read-through to follicular lymphoma from that withdrawal? Yeah, it's Jeff.

Jeffrey Ryan Stewart: Thank you for the question. First, these are very small indications. So to give you some sense of the relative size of the MCL in Bruvica, MCL is about 4% of the value. MZL is really less than a percent, about a percent.

Jeffrey Ryan Stewart: So we don't anticipate that those withdrawals due to the fact that we didn't get the confirmatory studies to clear will have a material impact. I think it's also important to note that many physicians will continue these people. patients on the medication. They won't be all switched, for example, or taken off and put on another product. That's market intelligence. There's no requirement that they need to do that for physicians.

Jeffrey Ryan Stewart: And so net net, this is not a really material issue given the size of those indications. Rupel will address your point on follicular. Yeah, I can talk about FL here for a minute. So a phase three readout is expected later this year. It's not clear if the MCL outcomes would be reflected in what we see there.

Roopal Thakkar: But what I would say about FL is, you know, our focus would be with Epco-Ridomab, our dual-engager, which we expect DLBCL actions here soon. And then we have programs, and we're seeing very high levels of response in FL with EPCO, either as monotherapy or in combinations, which we'll see some data on those combos in DLBCL and FL at ASCO as well. Thanks, Susan, and that concludes today's conference call. If you'd like to listen to a replay of the call, please visit our website at Investors.abby.com. Thanks again for joining us. Thank you for your participation. Please, participants, you may disconnect at this time. Then, Thank you.

Operator: and and and and and and you know and and and and and Bres. Thank you. Thank you. Thank you. Thank you, and and Thank you Them, and Thank you. Thank you. Thank you.

Operator: Thank you. Thank you. Thank you.

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