Q4 2024 AbbVie Inc Earnings Call
The End.
Speaker Change: Good morning and thank you for standing by. Welcome to the ADDIE fourth quarter 2024 earnings conference call. All participants will be in the listen-only mode until the question and answer portion of this call. You may ask a question by pressing star 1 on your phone. Today's call is also being recorded. If you have any objections you may disconnect at this time.
Speaker Change: In oncology I am very encouraged by our long term growth prospects. This includes our bcl two inhibitor <unk>, our fr Alpha ADC for ovarian cancer Ala here, our two novel C met Adcs for solid tumors <unk> and 400.
Speaker Change: And our bcm, a CD three by specific for multiple myeloma 383.
Speaker Change: Lastly, while the recent performance in aesthetics has been impacted by challenging market conditions in the U S and China. The category remains very attractive given low penetration rates for facial injectables when the market returns to more normalized growth, our leading commercial portfolio and four.
Speaker Change: It's coming pipeline will help drive improved performance.
Speaker Change: Based on the market trends over the last few years and our assumption for a gradual recovery in the near term, we now expect aesthetics to deliver a high single digit revenue CAGR through 2029.
Speaker Change: Turning now to R&D, we have made excellent progress with our late stage programs. These advancements include our recent approvals for <unk> in UC App, Kimberly and later lines of Follicular lymphoma.
Speaker Change: Here for Fr Alpha positive platinum resistant ovarian cancer Viola for advanced Parkinson's and new indications for Botox and Juvederm.
Speaker Change: In 2025, we anticipate approvals for <unk>, and GC Eh and <unk> for non squamous non small cell lung cancer as well as regulatory submissions for it to that but on in Parkinson's bank <unk> in higher risk Mds and bond T for aesthetics.
Speaker Change: We have also added depth to our pipeline by signing more than 20 early stage deals since the beginning of 2024, including promising technologies and innovative mechanisms that can elevate the standard of care in immunology oncology and neuroscience we.
Speaker Change: We have significant capacity to continue pursuing external innovation with a focus on differentiated opportunities that can drive growth in the next decade.
Speaker Change: In summary, I am very pleased with Abbvie execution in 2024, and expect our diverse portfolio to drive strong growth in 2025 and beyond.
Jeff: With that I'll turn the call over to Jeff for additional comments on our commercial highlights Jeff. Thank.
Jeff: Thank you Rob I'll start with the quarterly results for immunology, which delivered total revenues of approximately $7 3 billion exceeding our expectations.
Jeff: <unk> total sales were nearly $3 $8 billion, reflecting operational growth of 57, 9%.
Jeff: Invoke total sales were more than $1 8 billion, reflecting operational growth of 47, 1%.
Jeff: On a full year basis diversity, and revoke delivered approximately $17 $7 billion in total combined revenue and.
Jeff: An impressive increase of nearly $6 billion year over year exceeding our expectations.
Jeff: These results reflect strong performance across all approved indications I will share some highlights in the U S.
Jeff: Sky <unk> total prescription share in the biologic psoriasis market is now approximately 40%.
Jeff: Reflecting a very significant lead relative to all major competitors with in play capture rates remaining very strong.
Jeff: Over the course of 2025, we anticipate new data for Sky rosy on hard to treat areas of the body, including scalp and genital psoriasis.
Jeff: In addition, we expect the readout of our fifth head to head study in psoriasis, comparing <unk>, two which will continue to differentiate the brand versus oral competitors.
Jeff: <unk> is now capturing more than 20% in play share in atopic dermatitis as our communication around our level up study versus do pixel continues to ramp.
Jeff: Recall that in level up we showed strong comparative results on stringent endpoints of skin resolution and its reduction.
Jeff: And our a RIN book is achieving the leading in play share in the second line plus market consistent with the brand's label, we see that U S. Physicians are increasingly utilizing only one TNF prior to initiating <unk> treatment in RA.
Jeff: In Psoriatic arthritis, Sky resilient revoked together are capturing a leading in play share in their room category.
Jeff: Letting the effective co positioning of both agents in this important segment.
Jeff: Across IBD Sky Roseann, Renbarger also capturing substantial portfolio share given their respective efficacy safety and dosing profiles.
In Crohn's disease, which is roughly two thirds of the overall IBD market. These two treatments together are capturing approximately half of the in play share with total prescription volumes ramping very rapidly.
Jeff: In ulcerative colitis, we are seeing a very strong inflection following the <unk> launch in the second half of last year, both <unk> and <unk> together are already capturing roughly a third of the UC and play market, which supports robust momentum going forward for both Abbvie brands.
Jeff: We see similar performance internationally, as well where sky resilient revoke are also achieving leadership positions across our major countries.
Jeff: So I'm very pleased with this momentum and continue to see a significant opportunity for share gains across our existing indications. In addition to the typical market growth, we see across rheum, derm, and gastro and 2025 and beyond.
Jeff: Turning now to Humira, which delivered global sales of more than $1 $6 billion down 48, 7% on an operational basis, primarily due to biosimilar competition.
We continue to see molecule compression in the U S with volume moving to other novel mechanisms, which has resulted in a benefit to both <unk> and rent Belk.
Jeff: We anticipate Humira access will decrease throughout 2025 as more plans move to exclusive biosimilar contracts.
Jeff: It's reasonable to assume that roughly half of U S. Covered lives will continue to have parity access to humira on a full year basis with select exclusionary contracts for existing patients expected to begin around the middle of the year.
Moving now to oncology, where total revenues were approximately $1 $7 billion improve our global revenues were $848 million down six 2%, reflecting continued competitive dynamics and C. L. L vent.
Jeff: <unk> the global sales were $655 million up 13% on an operational basis, reflecting strong demand for both <unk> and AML across our key countries.
Jeff: Lastly, <unk> continues to demonstrate a strong launch trajectory for fr Alpha positive platinum resistant ovarian cancer with global sales of $148 million.
Jeff: Sales in the U S are annualizing at more than $600 million and commercialization is now underway in key international markets, where we are accelerating regulatory and reimbursement timelines.
Jeff: Moving to neuroscience.
Jeff: Our total full year revenues were $9 billion, reflecting impressive absolute sales growth of nearly $1 3 billion.
Jeff: In the quarter total revenues were $2 5 billion up 19, 9% on an operational basis. This robust performance was driven by continued double digit growth of railcar with global sales of $924 million Botox therapeutic with global revenues of $873 million.
Jeff: You <unk> with global sales of $303 million in Q Liptak with global revenues of $201 million.
Jeff: Beyond these leading therapies for psychiatry in migraine, we are very excited for an emerging portfolio in Parkinson's disease.
Jeff: We recently launched <unk>, the only subcutaneous 24 hour continuous infusion of levodopa based therapy for the treatment of advanced Parkinson's disease as a less invasive nonsurgical delivery system that can provide meaningful improvements in on time and off time, we are seeing very high interest from both.
Jeff: Physicians and patient communities.
Jeff: Parkinson's Expert's report significant benefit from our continuous 24 hour delivery and the control of symptoms morning day and through the night.
Jeff: While sales in the U S are expected to ramp gradually over the next several quarters as we work to establish the appropriate Medicare coverage and benefit determination.
Jeff: Take internationally is exceeding our expectations.
Jeff: Finally, I'm very encouraged by the data we are seeing for tobacco done for potential use as a mono therapy for early Parkinson's disease as well as an adjunct to optimize oral therapy for more advanced patients have abadan represents a very complementary addition to our Parkinson's disease portfolio with <unk> and dual BOP.
Jeff: So overall I'm extremely pleased with the commercial execution across our therapeutic portfolio, which is demonstrating very strong momentum as we head into 2025.
Jeff: With that I'll turn the call over to Kerry for additional comments on aesthetics Carey.
Kerry: Thank you, Jeff fourth quarter global aesthetic sales were approximately $1 $3 billion, reflecting an operational decrease of four 4%.
Speaker Change: In the U S aesthetic sales at $839 million declined 5% as challenging market conditions and promotional dynamics impacted yet.
Speaker Change: Consistent with recent quarters the U S facial injectable market continues to be affected by the depressed consumer spending that is related to the cumulative impact of high inflation over several years.
Speaker Change: The higher price procedure relative to current.
Speaker Change: Current conditions are most notably impacting the seller market, which declined by approximately 10% in the quarter.
Speaker Change: The toxin market remains more resilient demonstrating low single digit percent Kraft.
Speaker Change: Although we continue to be the clear market leader and toxins ancillary in Q4, our facial injectable share declines by a few points.
Speaker Change: In October we launched an updated version of our Alley consumer loyalty program, which was designed to benefit providers by increasing treatment frequency patient retention and cross selling.
Speaker Change: Some providers embraced in your loyalty program and then he felt the new contract with too complex to integrate into their practices, therefore negatively impacting market share and inventory levels.
Speaker Change: Based on this market reaction, we reinstated our original Alley consumer loyalty program earlier this month.
Speaker Change: This action has been that with a rapid and favorable response from our providers with encouraging early indicators for sales and market share recovery.
Speaker Change: Internationally aesthetic sales were $459 million.
Speaker Change: This represented an operational decline of three 2% that was primarily due to lowered you that ourselves as botox cosmetic sales were roughly flat on an operational basis.
Speaker Change: Our international results were impacted by our second largest global market China.
Speaker Change: Lower consumer spending related to economic headwinds continues to affect performance.
Speaker Change: Looking into 2025, we plan to prudently with our outlook for modest aesthetic sales growth.
Speaker Change: In the U S. This reflects a gradual improvement in market growth rates for sure for those taxes ancillary.
Speaker Change: Additionally, based on our Alley loyalty program changes, we expect a one time price adjustments negatively impact our first quarter U S results.
Speaker Change: Internationally, we are focused on retaining our strong competitive position as we launched multiple new products in China, while we closely monitor market conditions and consumer sentiment.
Speaker Change: In summary, while economic headwinds in key geographies have created a near term impact on market conditions. We continue to see significant long term growth potential given high consumer interests and low penetration rate.
Speaker Change: Allergy anesthetics is uniquely positioned to benefit based on our customer relationships commercial investment and innovative pipeline.
With that I'll turn the call over to Paul.
Paul: Thank you Carrie.
Paul: We continue to make significant progress with our R&D efforts to advance novel clinical programs across all stages of our diversified pipeline in.
Paul: In 2025, we expect a strong cadence of important data readouts regulatory submissions and new approvals as well as many clinical trial starts for key programs.
Paul: Starting with immunology.
Paul: Regulatory applications are under review for remote and GCI with approval decisions anticipated in the second quarter.
Paul: Data for two phase III RIN, both programs will be available this year, alopecia, areata and vitiligo and for our Hs and lupus programs in 2026.
Speaker Change: Moving to <unk>.
Speaker Change: Data from the head to head in psoriasis versus a tick too will be available. This year also this year to further support differentiation in IBD.
Speaker Change: Study, comparing <unk> to Entyvio and ulcerative colitis will be initiated.
Speaker Change: Additional mid stage monotherapy and combination studies are planned in 2025, including.
Speaker Change: Phase III study evaluating <unk> in atopic dermatitis phase.
Speaker Change: Phase II study evaluating <unk> and Lou because your mab and Psoriatic arthritis.
Speaker Change: And advancement of our anti <unk> antibody, a BBB eight 736 with the eventual goal to add it to the Crohn's disease platform study as a monotherapy and in combination with <unk>.
Speaker Change: Moving to oncology, where multiple regulatory and clinical milestones as well as phase transitions for key programs are planned.
Speaker Change: One area that we're particularly excited about is our ADC pipeline, where several assets are aimed at multiple tumor types.
Speaker Change: Our regulatory application is under review for accelerated approval of <unk> as a monotherapy in patients with previously treated C met over expressing Egfr wild type non squamous non small cell lung cancer.
Speaker Change: Target for an approval decision is in the first half of this year.
Speaker Change: This represents a segment of lung cancer with high unmet need where patients have limited options and tend to have a very poor prognosis. If approved <unk> would be the first C met directed ADC for the treatment of non small cell lung cancer.
Speaker Change: We are also rapidly advancing our next Gen C met asset.
Speaker Change: A phase III study evaluating a BBB 400 also known as T map a was recently initiated in patients with C met over expressed refractory metastatic colorectal cancer <unk>.
Speaker Change: <unk> as a monotherapy is being compared against chemotherapy plus bevacizumab. This year data from a phase <unk> study evaluating <unk> in combination with Bevacizumab could enable a phase III study.
Speaker Change: All comers population.
Speaker Change: <unk> is also progressing well across lung programs.
Speaker Change: Phase II study in Egfr Wild type non small cell lung cancer is being planned for <unk> will be evaluated with a PD one inhibitor as a frontline combination therapy.
Speaker Change: In the Egfr mutant segment results from the ongoing phase one study could enable team abbe dose optimization studies as a monotherapy in the second line setting and in combination with <unk> in the first line setting.
Speaker Change: In gastroesophageal cancer, a phase II trial was recently started evaluating <unk> in combination with chemotherapy and a PD one inhibitor in frontline patients.
Speaker Change: We are also excited about ABV 706, an ADC that utilizes the same total warhead and linker technology as team at Bay, but with an antibody that targets <unk> six.
Speaker Change: Encouraging data in small lung cancer small cell lung cancer were presented at ESMO last year.
Speaker Change: And this year dose optimization and longer term duration data will be available.
Speaker Change: This readout could lead to the initiation of a Registrational study in second line and dose optimization in combination with standard of care in the frontline.
Speaker Change: Moving to Fr Alpha Adcs.
Ella here is now approved for platinum resistant ovarian cancer in the U S and Europe and is currently in phase III development for the platinum sensitive ovarian cancer segment.
Speaker Change: Also and next generation ADC targeting Fr Alpha high Mg and 151 is currently in phase one.
Speaker Change: This year Ela here will be tested in combination with Bevacizumab and PARP inhibitor 151 is being advanced into dose optimization as well as in studies with standard of care agents, such as Bevacizumab, Carboplatin and a PARP inhibitor.
Speaker Change: These mid stage studies for <unk>, and 151 will be used to inform our phase III approach in various settings for ovarian cancer, including induction and maintenance in platinum sensitive patients and in combination for frontline maintenance.
Speaker Change: Another ADC from immunogen, known as pivot targets, a rare hematologic malignancy called blasted plasmacytoid dendritic cell neoplasm.
Speaker Change: Based on positive data from the pivotal phase III study a regulatory application is planned for later this year. If approved this would be an important new treatment option for patients with this aggressive blood cancer.
Speaker Change: Also in the area of hematologic oncology.
Speaker Change: Phase III then collects the Mds study is nearing completion with an overall survival data readout later this year.
Speaker Change: Now moving to neuroscience.
Speaker Change: Following the <unk> and power one and two study Readouts a thorough analysis of the data was conducted to better understand the placebo effect observed in the two trials.
Speaker Change: Our findings point to a lack of uniformity of placebo effect across site.
Speaker Change: When assessing sites beyond those with high placebo response, a clear efficacy signal was observed, albeit more modest than reported in phase one b.
Speaker Change: Therefore, we see a path forward as an adjunct to atypical in schizophrenia and as a monotherapy in psychosis related to all timers and Parkinson's.
Speaker Change: These are diseases, where there is a high unmet need for safe and tolerable treatments that can provide even a modest benefit.
Speaker Change: Additionally, our intention is to explore higher doses of <unk>. This is based on the degree of variability observed in the PK data from the empower studies, if higher doses are found to be safe and well tolerated.
Speaker Change: There is a potential opportunity to evaluate <unk> as a monotherapy in schizophrenia.
Speaker Change: As higher doses may result in greater efficacy.
Speaker Change: A multiple ascending dose study will be conducted this year and data will be available in the early part of 2026. Following this dosing work phase III studies in adjunctive schizophrenia, and potentially monotherapy schizophrenia will be initiated.
Speaker Change: Dose ranging in elderly patients is ongoing with phase III studies planned in 2026 in patients with psychosis related to all timers and Parkinson's disease.
Speaker Change: Staying on the topic of Parkinson's disease positive topline results from the third phase III trial for <unk>, We recently announced.
Speaker Change: And the tempo to trial <unk> met the primary endpoint demonstrating a significant reduction in the severity of Parkinson's disease symptoms compared with placebo at week 26 key secondary endpoints were also achieved.
Speaker Change: We are very pleased with the emerging profile for it to wrap it up with show strong efficacy as a monotherapy and as an add on to <unk>.
Speaker Change: The six month data from the Phase III study that showed <unk> to be generally safe and well tolerated with low rates of adverse events of special interest such as sedation and impulse control disorder.
Speaker Change: Longer term safety data will be available this year and regulatory submissions will then follow.
Speaker Change: Moving to aesthetics.
Speaker Change: We met with the FDA late last year regarding our <unk> submission for the treatment of glabella lines.
Speaker Change: We are in the process of generating additional CMC data requested by the agency, which should be completed in the next few months the regulatory submission will likely occur around the middle of the year.
Speaker Change: To summarize there have been significant advancements across all stages of our pipeline in 2025, we anticipate numerous important regulatory and clinical milestones, including many trial starts for key programs.
Scott: With that I'll turn the call over to Scott.
Scott: Thank you ruble star.
Scott: Starting with our fourth quarter results, we reported adjusted earnings per share of $2 16.
Scott: Which is eight above our guidance midpoint.
Scott: These results include an 88.
Scott: Unfavorable impact from acquired IP R&D expense.
Scott: Total net revenues were $15 1 billion.
Scott: Reflecting robust growth of six 1% on an operational basis, excluding a.
Scott: 0.5% unfavorable impact from foreign exchange.
Scott: Our ex Humira platform delivered reported growth of 22% once again exceeding our expectations.
Scott: Adjusted gross margin was $83.
Scott: 8% of sales.
Scott: Adjusted R&D expense was 15, 1% of sales.
Scott: And adjusted SG&A expense was 23, 6% of sales.
Scott: The adjusted operating margin rate margin ratio was 34, 7% of sales.
Scott: This includes a 10, 4% unfavorable impact from acquired IP R&D expense.
Scott: Net interest expense was $610 million the adjusted tax rate was 22%.
Scott: Turning to our financial outlook for 2025, our full year adjusted earnings per share guidance is between $12 and 12.
Scott: And $12.32.
Scott: Please note that this guidance does not include an estimate for acquired IP R&D expense that may be incurred throughout the year.
Scott: Yeah.
Scott: We expect total net revenues of approximately $59 billion.
Scott: <unk> robust operational growth of five 7%.
Scott: Despite a roughly 4% net unfavorable impact across our portfolio from the Medicare part D benefit redesign.
Scott: At current rates, we expect foreign exchange to have a 1% unfavorable impact on full year sales growth.
Scott: This revenue forecast contemplates the following approximate assumptions for select key products and therapeutic areas.
Scott: We expect global immunology sales of $29 4 billion <unk>.
Scott: Including <unk>.
Scott: <unk> revenue of $15 9 billion.
Scott: Reflecting growth of more than $4 1 billion driven by continued strong performance in psoriasis as well as robust uptake in IBD.
Scott: <unk> sales of $7 9 billion, reflecting growth of nearly $2 billion with continued market growth and share momentum across all approved indications.
Scott: And Humira total revenue of $5 6 billion.
Scott: Including U S sales of $4 billion as more plans exclude branded humira around the middle of the year.
Scott: This forecast includes a 600 million net unfavorable impact from the Medicare part D benefit redesign.
In oncology, we expect global sales of $6 3 billion include.
Scott: Including <unk>.
Scott: <unk> revenue of $2 7 billion.
Scott: Which reflects a $400 million net unfavorable impact from the Medicare part D benefit redesign.
Scott: Then collects the sales of $2 6 billion, reflecting continued strong demand, partially offset by a $100 million net unfavorable impact from Medicare part D benefit redesign.
Scott: <unk> revenue of $750 million.
Scott: For aesthetics, we expect global sales of $5 3 billion.
Scott: Reflecting gradual improvement in market conditions across global markets as well as market share recovery in the U S.
Scott: This includes botox cosmetic revenue of $2 8 billion and.
Scott: And relatively flat sales for Jupiter.
Scott: For neuroscience, we expect global sales of $10 billion.
Scott: Reflecting continued double digit growth.
Scott: This includes <unk>.
Scott: <unk> revenue of $3 5 billion, reflecting continued strong prescription demand, partially offset by a 200 million net unfavorable impact from the Medicare part D benefit redesign.
Scott: Botox therapeutic sales of $3 5 billion.
Scott: Total oral <unk> revenue of $2 1 billion and <unk> sales of $300 million.
Scott: For eye care, we expect global sales of $2 2 billion.
Scott: Moving to the P&L for 2025, we are forecasting full year adjusted gross margin of approximately 84% of sales.
Scott: Adjusted R&D investment of approximately 14, 5%.
Scott: Adjusted SG&A expense of approximately $13 2 billion.
Scott: And an adjusted operating margin ratio of roughly 47% of sales.
Scott: We expect adjusted net interest expense of approximately $2 6 billion.
Scott: Which primarily reflects the annualized financing financing cost for the immunogen and serve El transactions.
Scott: We forecast our non-GAAP tax rate to be approximately 15, 6%.
Scott: Finally, we expect our share count to be roughly flat to 2024.
Scott: Turning to the first quarter, we anticipate net revenues of approximately $12 8 billion.
Scott: At current rates, we expect foreign exchange to have a one 6% unfavorable impact on sales growth.
Scott: This revenue forecast comprehends the following approximate assumptions for our key therapeutic areas.
Scott: Immunology sales of $6 1 billion.
Scott: Including <unk> sales of $3 2 billion and revoke revenue of $1 6 billion.
Scott: We expect U S humira sales of $900 million.
Scott: We also anticipate oncology revenue of $1 5 billion.
Scott: A steady sales of $1 1 billion.
Scott: Which includes an unfavorable one time price adjustments due to the re implementation of the original OE program.
Scott: Neuroscience revenue of $2 1 billion.
Scott: And I care sales of $550 million.
Scott: We are forecasting an operating margin ratio of roughly 44, 5% of sales and model a non-GAAP tax rate of approximately 13, 8%.
Scott: We expect adjusted earnings per share between $2 47.
Scott: And $2 51.
Scott: This guidance does not include acquired IP R&D expense that may be incurred in the quarter.
Scott: Finally add these robust business performance continues to support our capital allocation priorities.
Scott: Our cash balance at the end of December was approximately $5 5 billion.
Scott: And we expect to generate free cash flow approaching 17 billion in 2025, which includes roughly $2 7 billion of Sky <unk> royalty payments.
Scott: This free cash flow will support a strong and growing quarterly dividend, which we have increased by 310% since inception.
Scott: As well as debt repayment, where we expect to pay down nearly $3 billion of total debt. This year and remain on track to achieve a net leverage ratio of two times by the end of 2026.
Scott: Our strong cash flow also provides capacity for continued business development to further augment our portfolio.
Scott: In closing we are pleased with <unk> results in 2024, and our financial outlook remains very strong we.
Scott: We have considerable momentum across our diverse portfolio and we continue to be well positioned to deliver robust growth in 2025 and beyond.
Liz: With that I'll turn the call back over to Liz. Thanks.
Liz: Thanks, Scott, we will now open the call for questions and 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.
Speaker Change: This is my first question comes from from <unk> with Guggenheim Securities. Your line is open.
Speaker Change: Great. Thanks, Thanks for taking the question so maybe just to kind.
Speaker Change: Im a little deeper on the scanning receiver will accomplish a great performance in guidance can you just comment a little more on pricing dynamics that youre seeing there and sort of how you factored in pricing both for this year and maybe over the next several years and then just a quick follow up on the comments that were given around aesthetics.
Speaker Change: Specially on the share side.
Speaker Change: Most of your points when maybe getting it back can you just give us a sense of where you.
Speaker Change: The share is now for Botox contributor I'm sorry at this point in time thank.
Speaker Change: Thank you.
Speaker Change: Yes, Thanks, Tom It's Jeff.
Speaker Change: I'll comment on <unk> and <unk>.
Speaker Change: And I think we've been very consistent that.
Speaker Change: Over the near term and over time. This is this is a volume based business. So we're going to see probably.
Speaker Change: Price declines year over year, but I would say modest right, we've sort of highlighted that as we negotiate the formularies. We have started to consistently see sort of these low single digit price concessions now obviously.
Speaker Change: What Scott highlighted.
Speaker Change: Was unique for the 25 year with the part D redesign that he outlined so overall.
Speaker Change: Consistent low single digit price declines from the Rebating side with a one time.
Speaker Change: One time part D and we we would anticipate once we lap the part D. We would see that sort of trend going forward.
Speaker Change: <unk>. This is Rob I'll, just add that if you really think about sky Regina <unk>. Our strategy here was to elevate the standard of care for patients and ultimately will drive a rapid return to growth for the company beyond Humira and that's exactly we've been able to execute that strategy has played out you see the differentiation in the marketplace. We have nine head to head studies, we're launching.
Speaker Change: A few more.
Speaker Change: Our guidance now by an additional $4 billion in 2027, we've been very consistent in our language around the pricing dynamics. We said when you think about rebates to think about it.
Speaker Change: A negative low single digits going forward, but given the robust performance of these assets its volume that's dominating the growth and we'd expect that to continue.
Speaker Change: Hi, This is Gary I'll answer your question around Botox and David I'm sure.
Speaker Change: So in the U S. We remain the clear market leader for both <unk> and Celerity in Q4, a few points share erosion, bringing botox turnaround the low to mid sixties.
Speaker Change: But I'm still around the low to mid forties.
Speaker Change: I said the reversion of the loyalty program back to the original language, we announced in December and then put into action in January 21st was greeted with very positive response from our customers and encouraging signs for us to recapture that share.
Speaker Change: For both Botox and <unk> throughout the year and just to note that the share did not go to one competitor or rather.
Mark it's distributed amongst the entire competitive set.
Mark: Thanks, Rommel operator next question please.
Speaker Change: So the next question comes from Chris Schott with Jpmorgan. Your line is open.
Chris Schott: Great. Thanks, so much just a two parter on the salaries are invoked dynamics, maybe just first on the 2027 guidance can you just elaborate on what were the biggest drivers of upside to those those targets is think about the various indications for the drugs.
Chris Schott: Is it fair to think most of this coming from IBD or is it across the board and then probably a longer term question on those brands can you just elaborate a little bit more on how we should think about the growth rate beyond 2027 servicing how mature will these franchises be by then and what type of growth rates can we think about over time. Thank you.
Yeah, maybe thanks, Chris It's Jeff I'll start on that so the primary driver of the change is in fact share capture.
Chris Schott: So the pricing assumptions have been consistent we can call the market's pretty well we see the we see the actuals in the long term trends. There. So it's been really share capture and I would say that we see it across the board certainly we've been super encouraged with Sky Rosy in psoriasis.
Chris Schott: Consider to see very very robust trs share trends.
Chris Schott: And there is no question that the the ramps in.
Chris Schott: IBD have been very very significant so that is that's a big piece of it but I would say it's across the board so predominantly share.
Chris Schott: Capture I don't know if Scott you have anything to add but thats the big dynamic there in the 4 billion, yes, Jeff maybe Chris we hope I can give you the breakdown by indication between the two on the 2027 guide. So we've talked about $31 billion combined in 2027, Thats, our new long term guidance.
That is 11 billion for <unk> and 'twenty for Sky Rizzi revoke his broken down room is about $4 eight.
Chris Schott: Dermatology two five.
Chris Schott: <unk> three seven.
Chris Schott: And then on the <unk> side 12, and a half.
Speaker Change: Of that $20 billion guide is from Psoriatic and the remaining seven 5 billion is coming from IBD. So that might help you kind of see those with where the growth is coming from as well and if we speak to it in terms of the $4 billion just to give you a sense then to add to what Scott mentioned <unk> is up $3 billion of $1 billion of that is psoriatic and two.
Speaker Change: $2 billion of IBD, we're just seeing tremendous ramps early days with IBD and then for <unk>. It's up 1 billion from the previous guidance and that's a mix of roughly $300 million room $200 million Durham and $500 million IBD. So again.
Speaker Change: Across the board, we're seeing tremendous performance, particularly in IBD.
Speaker Change: And then your question on how to think about the growth we haven't obviously given guidance beyond 'twenty seven but as I look at the sell side consensus clearly.
Speaker Change: The growth in sell side consensus beyond 'twenty seven is below our expectations, we would expect to see.
Speaker Change: These markets continue to grow we would also expect to see continued share gains, albeit as you start getting close to that in play share level.
Speaker Change: No.
Speaker Change: Sure curve bends, but still you still expect to see some level of share growth and then keep in mind. We will have the five we expect the five new indications for <unk> collectively, adding about $2 billion peak sales and so that will also contribute so as I think about the rate of growth for <unk> beyond 'twenty, seven rainbow will likely grow faster than <unk>.
Speaker Change: <unk> because of those new indications, but youll still see a robust performance from both assets at least through 32.
Chris Schott: Thanks, Chris Operator next question please.
Speaker Change: Our next question comes from Geoff Meacham with Citigroup. Your line is open.
Geoff Meacham: Hey, guys. Good morning. Thanks, so much for the question just had a couple.
Geoff Meacham: The first one on <unk> you guys called out the partial impairment today and the pressures I just wanted to get your perspective as to what the drivers are for the remaining value assuming <unk> is mostly but wasn't sure. What you would assume for an <unk> or backup compounds.
Geoff Meacham: And then just on aesthetics with the new guidance to 2029 is it fair to say that you think 25 could be the trough or have already seen a trough in terms of the growth rate.
Geoff Meacham: I'm just trying to think of the longer term picture and then just on bond to you wanted to get your perspective about.
Geoff Meacham: The potential success, there, adding new patients to the paradigm.
Geoff Meacham: Just given the the potential there thank you.
Geoff Meacham: So Jeff on your on your first question regarding this is Rob on your first question regarding cerebral so keep in mind with the accounting rules do not allow you to write up.
Geoff Meacham: The intangibles, so even though we are more optimistic about <unk> now than we were at the time of the deal we can't write that value up so that would be the same as what we originally described.
Geoff Meacham: We still obviously, it's rupal walks you through the development programs for <unk>.
Still see opportunity in adjunctive schizophrenia, as well as well as narrow degenerative psychosis, and we haven't completely given up on the mono therapy opportunity either.
But that's a more heavily risk adjusted opportunities out so when you think about.
Geoff Meacham: The value you have taken into account the timing. So there is some level of time delay as well as a different probability of success for monotherapy, that's all baked into because youre essentially valuing risk adjusted revenues you would have to take that into account that said.
Geoff Meacham: We're still optimistic about the asset we're pursuing it in these indications and again as I mentioned, we haven't completely given up on monotherapy that'll depend on dose ranging.
Geoff Meacham: That is the way we constructed the revaluation of the intangible but overall, we still see a very nice opportunity, particularly for <unk> and we still see potential for <unk> as well.
Geoff Meacham: Geoff I'll take your question regarding the aesthetics troughs. So so we've not specifically.
Geoff Meacham: <unk> that but the way that we've modeled it and think about it is we do see recovery and I think the big headwind here has been over the last two years has been the economic conditions. So we do see continued improvement carry spoke about some of the market growth rates that we're seeing coming back here in the U S for both dealers and toxins.
Geoff Meacham: So we would if you model you would anticipate 25 to be the trough and then your long term guidance is at high single digit compound annual growth using 25 as the base year through 'twenty nine and if you model that that's going to put you somewhere in north of $7 billion.
Geoff Meacham: Certainly this is a business we continue to be excited about.
Geoff Meacham: We think that there are continued to be low market penetration rates globally, frankly, and we've got some innovation to continue to drive market growth that market has grown low double digits historically, but I think it was we model we're thinking at a high single digit growth in the markets, but we do see some growth accelerators with with <unk> and maybe I'll, let the team.
Geoff Meacham: Maybe I'll just mentioned here just more broadly this is rob on the business I think as you reflect on the aesthetics performance and we are just going through a period of macroeconomic pressure on that business, but we do continue to see an attractive long term setup again, given low penetration rates high consumer interest and our leading portfolio, including some exciting pipeline programs and taxes.
Geoff Meacham: Fillers when you think about it as part of Abbvie. The aesthetics business has been able to continue investing despite the macroeconomic challenges in that will allow us to maximize opportunities when the market does recover we set up this business to be a global fully integrated unit with dedicated support from R&D and business development and I am confident that focused approach will pay off in the long run it's just been difficult for us to call.
Geoff Meacham: The market recovery, while we still have a lot of confidence in the long term outlook.
Carrie: And this is Carrie comment on <unk>.
Carrie: So as you said <unk> will be an important catalyst for new patient activation into the category.
Carrie: Iteration continues to be very high for aesthetics and for toxin and like we said it continues to be Underpenetrated and that's because there continues to be barriers for these people who are interested in the category, but not acting around cost and concerns of an unnatural luck and thats really where <unk> will play.
Carrie: And important of all based on it unique profile that is suited to address these concerns it's fast acting short duration. So it's going to be a nice option to position for these consider to try buy.
Carrie: And then our commercial strategy will be to convert that from <unk> to botox.
Carrie: This is going to be an important pipeline catalysts to help us sort of activate that consumer market and drive more consumers attachment category for botox.
Carrie: Maybe one comment to add the carry on the R&D side, even thinking past that this year, we will initiate a study with <unk> plus botox.
Carrie: To cover people.
Carrie: Immediately and get that long term benefits so that those studies will start this year.
Geoff Meacham: Thanks, Geoff Operator next question please.
Geoff Meacham: Our next question comes from Terence Flynn with Morgan Stanley. Your line is open.
Terence Flynn: Hi, Thanks for taking the questions.
Speaker Change: You mentioned the net impact of the part D. Redesign can you tell us what the volume impacts you guys are assuming if any and that that.
Speaker Change: Calculation and then the second question I had is on the pipeline Slide you noted you could have some phase two you see data for <unk>, three which I believe is your oral.
Speaker Change: <unk> one agonist.
Speaker Change: Just maybe speak to conviction level, there and how you think about that on the forward and if that would be something that you could move into phase III. Thank you.
Scott: Terence it's Scott.
Scott: I'll take your question on the volumes, so we've guided to 4% of net impact across the business for a headwind to growth for part D. Redesign now when we think about that volume offset we've not quantified that in the guidance, but that is part of the 4%. It's a I would say in the Grand scheme, it's a fairly modest offset overall and I think part of what you need to do.
Scott: Do you think about that volume recognize that when you look at the patient segments that exists there is roughly three patient segments and they each take about a third of the business. But this is really something that will impact the standard eligible and we're working very hard to ensure that people are electing cap and smooth and so we really see that volume offset coming from that one third of the patients.
Scott: Segment to drive that and so that's why I think it's a little bit more of a modest.
Scott: Offset but we've not quantified it and it's logical when you think about it because the other two thirds I mean, you have the popular.
Speaker Change: Population was it was one third so they don't have an out of pocket burden like the standard eligible due and then the other third are covered by employer plans, where again they don't have the same out of pocket burden. So when we analyzed it we looked at the market and saw that about a third as Scott mentioned of the population would benefit from the lower out of pocket, but keep in mind the cost share applies to the entire book of Medicare.
Scott: So that's why the volume doesn't offset the price impact.
And this is ruble I'll cover the MLR question. This is our asset from land dose. We had observed very early data I would say phase one b in ulcerative colitis.
Scott: And that looked good but it was.
Scott: Very small sample size I would say so this will be a robust phase two with the.
Scott: A placebo comparator and we will get objective data from centralized review of endoscopic data so it will be.
Scott: Good data set to look at and if it looks good definitely would be a phase III asset for us and the other consideration we would have similar to what I highlighted about other biologics that we would be combining with sky rosy. If this looks good this could be a combination agent with <unk>.
Scott: As well.
Speaker Change: Thanks, Darren Operator next question please.
Speaker Change: Yes. Our next question comes from Mohit Bansal with Wells Fargo. Your line is open.
Mohit Bansal: Great. Thank you very much for taking my question and congrats on all the progress.
Speaker Change: I have a question that ini.
Speaker Change: I know you've talked in the past about.
Speaker Change: The agenda benefiting from some of this you might have prescriptions going through these.
Speaker Change: These agents as well.
Speaker Change: So taking that aside.
Speaker Change: So it seems like the volume.
Speaker Change: <unk> is growing rapidly can you talk a little bit about the dynamics as well here why this market continues to grow in.
Speaker Change: And how should we think about longer term for the overall market growth et cetera. Thank you.
Geoff Meacham: Yeah. So thanks, Mohit, it's Jeff and like.
Geoff Meacham: Like we talked about before particularly around the acute event in this case. This was the Cvs exclusion in April.
Geoff Meacham: We could clearly start to measure the fact that not all of the switching from Humira was going to.
Geoff Meacham: Going to the Biosimilar, we saw about 20% of it was slipping away into new mechanisms.
Geoff Meacham: Or more advanced mechanisms like Sky <unk>.
Geoff Meacham: Now we've continued to see the molecule compress and.
Geoff Meacham: Physicians are using just less and less sequentially.
Geoff Meacham: Humira in the Biosimilars overtime, I would say, it's becoming harder to measure because you're also seeing a lot of dynamics around new head to head trials, new indications new other approaches I would say overall.
Geoff Meacham: There, but it's relatively modest in the scheme of the volume that is basically accruing from basically the promotion and the profile of the medication.
Geoff Meacham: So it should continue the more that we see sort of disruption in the market Youll, probably continue to see the molecule on trend continuing to compress.
Geoff Meacham: Now.
Geoff Meacham: Albeit albeit modest your other points very important these markets are still very very buoyant and significant and one of the dynamics that we see over time and I think we'll begin to see it.
Geoff Meacham: Quite dramatically around the world, particularly in IBD is that the lines of therapy start to expand so it used to be like primarily what what's fueling the markets was primarily the new patients coming in off of older traditional medications, but now you are seeing the emergence in atopic dermatitis of the second and third.
Geoff Meacham: Fine.
Geoff Meacham: Markets, which are growing quite substantially youre going to see that significantly emerge in IBD, where before physicians were really really afraid to move people along so they did dose intensification. They added more steroids, but now that theres drugs like <unk> and <unk> and other agents youre seeing those <unk>.
Geoff Meacham: <unk> lines of therapy expanded so that should continue and we've contemplated that in our in our long term projections, but that gives you. Some sense of why you are observing what youre seeing now as we look across as Rob as we look across the specialty areas.
Geoff Meacham: In psoriasis in IBD, we're projecting high single digit market growth atopic dermatitis in the mid teens, it's growing very I mean, youre seeing is still fairly low penetration rates for atopic dermatitis. So there's tremendous room for growth.
Geoff Meacham: We would anticipate mid teens market growth there and then in rheumatoid arthritis is probably more like low to mid single digits, but you can see across the board very nice market growth, which then will be complemented by the market share gains.
Mohit Bansal: Thanks, Mohit operator next question please.
Speaker Change: Yes. Our next question comes from Dave Risinger with Leerink Partners. Your line is open.
Mohit Bansal: Yeah.
Dave Risinger: Yes, thanks very much so.
Speaker Change: I have two questions. Please first regarding Abbvie 400, or T map a could you. Please frame your long term commercial vision for this candidate, including what some may underappreciated about how broadly it could potentially be adopted in the early 2000 <unk>.
Dave Risinger: Then second on <unk>.
Dave Risinger: External transactions and <unk> was a setback, but abbey's overall M&A track record has been very successful could you. Please discuss your agenda for M&A, including the potential to leverage your franchise strength and related product categories. Thanks, So much.
Dave Risinger: Yes, hi, it's Jeff So I will give some some thoughts on that it's a very very attractive asset I think it's underappreciated and.
Dave Risinger: And part of it is the the first category it will compete in which is colorectal cancer.
Dave Risinger: You look at the response rate that we've seen let's say in a small or mid size.
Dave Risinger: Cancer type, which is ovarian cancer with Ela here, it's quite striking I mean <unk> has been the most rapidly adopted ADC and the entire U S oncology market and it's because it entered this market that was basically almost all chemo based with unmet need where there've been no innovation and when we look at the entry with 400.
Dave Risinger: T T map a into colorectal cancer, it's a substantially larger tumor type as it is quite evident and we've already seen very very nice monotherapy result in later lines much much better than we've seen with the old chemo standard of care and really it's whether or not they have seen.
Speaker Change: Or not now the thing that will really cause a big inflection that roop will can talk about in a moment is that it's the combine ability as you go up into the lines of therapies, Okay, and thats really going to make this thing in <unk> and.
Speaker Change: And become a very very significant product for patients in colorectal cancer.
Speaker Change: Over time.
Speaker Change: The studies will have to bear that out.
Speaker Change: And as well, we're seeing very very significant early results in lung cancer as well. So it is I think it's an underappreciated asset we will have a chance with to lease so V to sort of set the market around this whole C met the modern seem that area, but it's quite striking so first we established in late.
Speaker Change: Airlines very big cancer directly against older chemotherapy and then we move combination as we move forward. So thanks for the question Paul maybe just a comment there.
Speaker Change: Our strategy around Adcs in I think 400.
Speaker Change: <unk> is a good highlight of that so we think about what's a good target, meaning high expression on the tumor low expression in healthy tissue and then we are continued to focus on.
Speaker Change: Patient selection individualization of care utilizing robust biomarkers as Jeff mentioned C met that has the opportunity to optimize benefit risk and particularly tolerability with our total warhead platform we've seen.
Speaker Change: Low rates for example of <unk>, stomatitis, diarrhea, which others I think continue to struggle with and safety and Tolerability of Jeff as mentioned are critical. So we're also very focused on proper dose optimization to get this right. So we're able to combine in earlier lines and.
Speaker Change: It's the same approach that we have with the other one I mentioned 706 in small cell lung cancer and others in the pipeline.
Speaker Change: And then David This is Rob I'll take your question on M&A and thank you for acknowledging the strong track record we've had as a company I would agree with that when you think about the transaction with be either Brian or sky Rosy with Pharmacyclics that brought some brewer can really gave us the critical mass to be a leader in.
Speaker Change: In blood cancers, and then the transaction with Allergan, which gave US three verticals that can really drive long term growth of the company neuroscience aesthetics and eye care and more recently the transaction with immunogen, which really bolstered our ADC pipeline.
Speaker Change: <unk> has highlighted in terms of our go forward strategy on BD, we continue to pursue assets that can add depth to our pipeline and really drive growth in the next decade, and we have clear line of sight to growth for at least the next eight years.
Speaker Change: Within the company today and so my focus is really about bringing in assets that can help drive that growth in the next decade and since the beginning of 'twenty four as I mentioned in my prepared remarks, and we signed more than 20 early stage deals across immunology oncology and neuroscience immunology. We've added novel mechanisms that have the potential array San.
Speaker Change: Recur either as a monotherapy or in combination with Sky resumed Rune book, you should expect that strategy to continue in oncology, we have added new platforms, including multi specifics tri specifics T cell engages and insight to car T approaches and then within neuroscience not always appreciated the work we've been doing in neuroscience above and beyond <unk>.
We expanded our discovery collaboration in psychiatry with Gedeon Richter, who discovered railcar. We also invested in a novel mechanism for mood disorders with Gilgamesh and we recently acquired a next generation a beta antibody for Alzheimers from Ali Agha.
Speaker Change: <unk>.
Speaker Change: That is the area of focus we have these five areas that can drive long term growth I mentioned neuroscience aesthetics and eye care and of course immunology and oncology I mean, these are all large markets with high unmet need and so our BD efforts are focused on building pipeline depth in those areas I should say, if we see an opportunity for differentiation and another large market.
Speaker Change: With high unmet need we would consider pursuing it, especially if that can help drive growth in the next decade and the company has the financial wherewithal to pursue those opportunities as well.
Dave Risinger: Thanks, Dave Operator next question please.
Speaker Change: Yes. Our next question comes from Steve Scala with TD Cowen Your line is open.
Steve Scala: Thank you so much I have an observation and then two questions.
Steve Scala: Mr. Bashan is splitting hairs, but on part D redesign the guidance had been a three percentage point headwind. It was just said on the call four percentage points a year ago was two percentage points. If there is a change. Please can you identify that.
Steve Scala: Related to that is my first question are you seeing any evidence that IRA Medicare pricing is spilling over to the commercial market and if yes to what degree or is there absolutely. None and then my second question. The company has provided a lot of helpful perspective on the aesthetics market, but can.
Steve Scala: Distillate to a number the guidance for us that was previously greater than $9 billion in 2030, what is that number now thank you.
Steve Scala: Steve This is Scott I'll go ahead and start with your part D observation in question.
Steve Scala: With part D. We've really we saw that is something that the analysts and maybe the marketplace hadn't fully understand sort of the impact I think we were one of the first companies to come out and talk with any sort of specific specificity and granularity around what we saw that part D impact mechanics of how it would work and the impact to it. So we came out with.
Steve Scala: Our guidance number and I think that has probably as you noted the numbers, but it's evolved a little bit over time I would say, it's involved not necessarily from from our understanding of our D, but because really the mix of the business. So when we talk about it in the second quarter I believe I came out and said we thought we'd see her on approximately 3% headwind to growth.
Steve Scala: From the part D redesign, we've distilled that number and made a precise number of 4% roughly 4% today and really when you think about when I came out of that 3%, we see momentum in the business and we see momentum in the business and areas of immunology and oncology in particular, where we reached some guidance where we saw.
Steve Scala: Hi, part D channel mix and so that's really been a business mix change that has led to that 4% change and that's really kind of what it amounted to Steve I'll just add I mean, when you think about the setup for the company and 25, we said we would return to robust growth and we're delivering in absolute terms than our prior guidance.
Steve Scala: More than $2 5 billion of growth and that's with headwinds from U S. Humira erosion around $3 billion. The part D benefit redesign of approximately 2 billion. When you when you do the math on the roughly 4% and then $500 million headwind from the stronger U S. Dollar. So the underlying growth platform is going to drive eight.
Steve Scala: <unk> of growth when you think about <unk> and <unk> as well as neuroscience. So.
The change Youre seeing from as Scott mentioned is really more of a mix a function of mix, but we're very pleased with the underlying growth of the business has allowed us to absorb these impacts and still deliver robust growth in 2025.
Geoff Meacham: Steve It's Geoff I'll take your second question, so as we've as we've negotiated across the.
Steve Scala: The commercial.
Steve Scala: Books in the Medicare books, we have not seen any spillover or slippage.
Steve Scala: In our actual negotiations over the last cycles.
Steve Scala: One thing I would add is that we have seen in 'twenty four.
Some some more consumption.
Steve Scala: On the benefit redesign, particularly in oncology agents, so for in <unk> and <unk>, we actually see lower discontinuation and some more consumption. So that's encouraging because if you remember the part D sort of had the lead in where the cap moved down to roughly 33% 3400.
Steve Scala: It will sequentially moved down more to 2000 with the with the smoothing next year.
Steve Scala: Which is a good policy because it's encouraging to see that the change in benefit design makes people stay on their cancer medications are bit longer again, the volume will be more modest than the price hit as Rob and Scott.
Steve Scala: Described it but that's the dynamics that we're seeing in the channels.
Steve Scala: And see you on your question regarding the aesthetics guidance I'll reinforce what I said earlier and Rob as well. So when we look at that guidance that long term guidance is calling for high single.
Steve Scala: Digit CAGR through 25 through 29, so using 25 as the base year.
Steve Scala: If you do the math on that that range that is something above $7 billion little bit north of 7 billion, depending on where it falls within that high single digit range. So thats why we specifically given the range on the high single digit the market growth that we've seen historically has been low double digits.
Steve Scala: We're seeing that market were modeling for now high single digit growth during the time period that we've given this long term guidance and so I think the answer to your specific questions.
Speaker Change: Thank you Barry.
Speaker Change: Operator next question please.
Steve Scala: Okay.
Speaker Change: Our next question comes from Tim Anderson with Bank of America. Your line is open.
Speaker Change: Thank you a couple of questions. Please.
Speaker Change: On instead ask a question Ive asked before what are your expectations for how these new drugs are going to impact. This business you could argue that the surge and use of products.
Speaker Change:
Speaker Change: Two quick ones could be either a tailwind or a headwind to the use of products like toxins and pillars.
Speaker Change: It could be a headwind if patients are having to pick and choose between much products.
Speaker Change: To put their out of pocket dollars towards.
Speaker Change: And then a second question unrelated to the first PVM reforms still being debated in Washington, If Abbvie had its way.
Speaker Change: What would change about the current relationship between Pbms and drug companies.
Speaker Change: And what would you argue should be left alone.
Speaker Change: Hi, This is Terry I'll answer your first question around the obesity market in aesthetics opportunity and Youre exactly right. It continues to.
Speaker Change: You, both a headwind and a tailwind or headwind in terms of share of wallet.
Speaker Change: As these consumers are making decisions on what they're going to spend before we see that more for the higher priced products like fillers.
Speaker Change: And then also a tailwind as they get a new group of consumers our patients.
Interested in aesthetics and in many of our aesthetic providers are administering these products and so they see this as an opportunity for lead generation and bringing new patients into the category.
Speaker Change: So we do see it as a sort of a tailwind.
Speaker Change: Headwinds in the short term, but a tailwind in the long term and the question is not if inject.
Speaker Change: Injectables work, we know that these products work well in these patients it's really about how we can partner with our customers to build it and integrate it into their treatment practice and that's that's what we're doing with our customers now and helping them position Botox do you have an arm and a product line for these new patients theyre entering.
Speaker Change: Their practice.
Speaker Change: And Tim This is Rob I'll answer your question on PJM reform look if there are changes to the rebate system we.
Speaker Change: We don't have a strong preference between rebates or discounts and that's because we've always competed on the attributes of our products. Both the clinical benefit they provide and the value. They return of health system. So we're confident in our ability to compete in either world I would just point to our share performance in the international markets that do not have a rebate based system and we see similar market shares in those countries.
Speaker Change: Well, so we can compete effectively in either system, we don't have a preference.
Speaker Change: Thanks, Tim Operator next question please.
Speaker Change: Our next question comes from Chris Raymond with Piper Sandler Your line is open.
Chris Raymond: Yes, Thanks, just a question on <unk>.
Speaker Change: Topic Derm is a targeted indication.
Speaker Change: Just from some of our work it looks like the upside we're seeing in Rainbow.
Speaker Change: <unk> and room in Gastro and I know you guys have sort of mentioned the so it's fairly well known but in atopic derm the lease from our data it looks like things are starting to flatten out a little bit and I heard your comments on the derm share of invoke revenue in 2027, but that would seem to infer maybe some kind of inflection. So maybe a two part question here.
Speaker Change: Talk about the current maybe atopic derm growth dynamic.
Speaker Change: And is there an inflection sort of anticipated.
Speaker Change: And then the second part of that is should we be paying more attention maybe too late accuser map.
Speaker Change: As a contributor here I know, Jeff you've talked about atopic derm is a very important indication that you guys are targeting.
Speaker Change: Or is there some other sort of area like external innovation that you'd say.
Speaker Change: Will.
Speaker Change: Augment maybe your position in this indication.
Speaker Change: Yes. It is.
Speaker Change: Very good question, it's an important.
Speaker Change: It's an important.
Speaker Change: Segment and to give you some sense of what we see in terms of the inflection. So we have seen a significant inflection in our new patient capture and this is despite the launch of other interleukin products over the last year. So we've ramped to the highest in place shares that we've had.
Speaker Change: And it was largely flat in the teens for mid teens for many many quarters and it's ramping up now above 20% and a lot of that is we've been able to start to distinguish RIN.
Speaker Change: <unk> on the stringent endpoints basically like really minimal disease activity, where you're taking it down to a very very low level and youre almost completely clearing the skin and those are the endpoints, where we significantly outperform dupee now having said that <unk> still got the vast majority of their but we are seeing we will see that in play share.
Start to build into the Trs as over time, because our Trs shares quite below 20% at that point I think the other thing that I would note is that in many if not most of the hour.
Speaker Change: Outside the U S market, our shares are much higher and build even a little bit faster.
Speaker Change: In several large markets. We actually are ahead of <unk> and some of that has to do with the way that the label work during our initial launch et cetera, but we're quite bullish over time in terms of RIN Voake. As this is the best agent in terms of getting to the to the complete control now having said that we would and we will continue to look for.
Speaker Change: There are more assets some are in our pipeline as described but this is a very very attractive space that we want to continue to invest in I don't know if <unk> got any comments on <unk> or some of the other constant that's right I mean with the 5% penetration rate. There is still many patients that are untreated.
Speaker Change: So <unk> will be our next one and as Jeff mentioned Theres other pipeline assets that we're working on in key being skin clearance along with that itch and if you can get them, both and have a safe and tolerable profile I think that'll continue to be competitive.
Speaker Change: Thanks, Chris Thanks, Operator next question please.
Speaker Change: Thanks. Our next question comes from Trung Nguyen with UBS. Your line is open.
Trung Nguyen: Great. Thanks for taking my questions just two from me.
Trung Nguyen: So firstly youll sales in <unk> did you see any notable difference in trends in stocking or gross to net patterns across the portfolio.
Speaker Change: Have the changes in part D.
Speaker Change: Versus previous years, specifically I'm interested if you had any meaningful one off to Scott <unk> room nights for the quarter.
Speaker Change: And then circling back on the aesthetics thinks of that updated long term guide can you give us a bit more color geographically, how we should think about the split between ex U S.
Speaker Change: China versus the U S. As you return to growth is that an expectation on one coming back quicker than the other.
Speaker Change: This is Scott I'll talk about the stocking so we did not see in the past we've talked about a couple of years ago in particular, but but the stocking was.
Speaker Change: Relatively minimal from in terms of the impacts so we did not see anything with respect to sky <unk> on us on the stocking in the fourth quarter that'll that'll be impacted the first quarter.
Speaker Change: And no no real dynamics, showing gross to net either no thats right prescribers.
Speaker Change: Prescribers and rare broken I'm, sorry, no no no.
Speaker Change: Dynamics around gross to net.
Speaker Change: For <unk> book.
Then with respect to <unk> I don't care, if you want <unk> sure for Fedex as we think about the long term.
Speaker Change: We see like we said, we're planning prudently further economic recovery around key markets like U S and China, where it's been challenging for the past few years.
Speaker Change: Those markets will continue to be important moving forward as well as the rest of the world, We see Japan as posting nice growth as being an underdeveloped market that we're able to invest in and then the pipeline catalysts will be important in both U S and the rest of the world, notably in China in the past year.
Speaker Change: We've had multiple new pipeline catalysts, which are going to which continue to help drive share.
Speaker Change: <unk> and <unk> last year, and this year and we expect the international business to continue to increase as.
Speaker Change: As a percent of the revenue for overall global allergy anesthetic.
Speaker Change: Thanks, John Operator, we have time for one final question. Please.
Chris: Sure and our last question comes from Chris <unk> with Goldman Sachs. Your line is open.
Speaker Change: Great. Thank you very much.
Speaker Change: When you think about going beyond 2030 with your strategy across the portfolio can you comment about the potential impact of some of these combination approaches in immunology do you expect these to be IP extending will there be co formulation based approaches just trying to understand the potential revenue.
Speaker Change: Occasions, noting that clearly there could be some clinical benefit that could certainly makes sense and then just a question about a business segment that has been around that you never talk about which is I care.
Speaker Change: How does that fit going forward I understand Theres. Some magazine with the Allergan deal I was just trying to think about the overall portfolio in areas, where you clearly have strength, but this seems to be one which is.
Speaker Change: No, it's less than 5% of revenues, but put us in a role for that on the floor of how are you thinking about it. Thank you.
Speaker Change: Hey, Chris It's Rupal, maybe ill start the ball rolling here on how we think about combos.
Speaker Change: The 23.
Speaker Change: Sorry into 2030. So the first thing is we have a very strong foundational asset.
Speaker Change: In particularly IBD with Sky Rizzi.
Speaker Change: And you've heard me mention other combo studies in Psoriatic arthritis today as well now that we would combine with with multiple assets that we've mentioned over time <unk> trend one.
Alpha four beta seven IL, one alpha beta ludy Kizziah Mab that we already have these.
Speaker Change: These that we would be able to look at as monotherapy and combo therapies. If they look good as mono therapies.
They could also move forward by themselves.
Speaker Change: For all of these assets. We're also looking at biomarker approaches, particularly with <unk>, but we would apply.
Speaker Change: That same strategy to have all of these assets and as combinations. The goal would be co formulation. So as we enter into the clinical study. We are also doing the CMC work in parallel.
Speaker Change: To facilitate combination co formulation approaches.
Speaker Change: That would also be a convenience factor and we would want to match with longer acting agents. So for example, the <unk>, we believe to be a longer acting agents for trim. One we're seeing along pharmacodynamic effect as an example.
Speaker Change: But then the next way that we think about this these combo strategies is if we start seeing Utah.
Speaker Change: Utility there obviously moving forward with the co formulation, but we are very.
Speaker Change: Very confident in making bi specifics <unk> is one of those so then in parallel we're making bi specifics that could then also stand alone as single assets and then as you have heard recently with a nimble transaction.
Speaker Change: We would also be looking at different mechanisms as an oral peptide the lead one being IL 23, but we're also working on a <unk> and whats unique in what we like about that platform.
Speaker Change: Is the potency potentially being able to reduce the amount of peptide that's required and these assets having long half lives.
Speaker Change: So if they if that.
Speaker Change: <unk>.
Speaker Change: Holds then you could imagine combinations as a pill with these peptides with that type of.
Speaker Change: Uh huh.
Speaker Change: Profile that we hope to see so multiple steps as we think about immunology.
Rob: This is Rob your question on eye care, I mean, our focus on <unk> and glaucoma retinal disease and prescription dry eye.
Rob: We like that business it participates in a large market with high unmet need meets that criteria.
Rob: Much of a scientific focus it's a data driven business, it's a very efficient business as well and obviously, we're excited about the <unk> gene therapy program focused on wet AMD and diabetic retinopathy, depending on how it plays out I think you could see that becoming a stronger growth driver. We obviously have the four of the five.
Rob: If you think about you've got a lot of questions there, but we don't get as many questions in eyecare, but we do believe as you start to get more visibility to this <unk> program.
Rob: Spend more time, focusing on and we think of it as a potential to be a long term growth driver for the company and we like to fit it has for Abbvie.
Chris: Thank you, Chris 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 <unk> com. Thanks again for joining us.
Chris: Thank you that concludes today's conference you may all disconnect at this time.