Q4 2024 Novartis AG Earnings Call
Good morning, and good afternoon, and welcome to the Novartis Q4, 'twenty 'twenty four results release conference call and live webcast. Please note that during the presentation. All participants will be in a listen only mode. On the conference is being recorded after the presentation there'll be an opportunity to ask questions by pressing star one on one.
Any time during the conference. Please limit yourself to one question and return to the queue for any follow ups, a recording of the conference call, including the Q&A session will be available on our website. Shortly after the call ends with that I would like to hand over to MS. Layne since I'm head of Investor Relations. Please go ahead Madam.
Thank you Sharon good morning, and good afternoon, everyone and welcome to our Q4 and full year 2024 earnings call.
The information presented today contains forward looking statements that involve known and unknown risks uncertainties and other factors. These may cause actual results to be materially different from any future results performance or achievements expressed or implied by such statements.
For a description of some of these factors. Please refer to the Companys form 20-F, and its most recent quarterly results on form 6K that respectively were filed with and furnished to the U S Securities and Exchange Commission.
Before we get started I just want to Echo Sharon's comment them for all of our analysts. Please limit yourself to one question at a time and we'll cycle through the queue.
Many times as we can and with that I'll hand across to us.
Speaker Change: Terrific. Thanks, Paul and thanks, everybody for joining today's call to review our quarter, four 2024 and full year results.
Moving to slide four as you saw this morning Novartis delivered one of the strongest performances that we've had in our history in 2024, when you look at quarter four our sales grew 16% in core operating income grew 29% in constant currency and on the full year, we had 12% sales growth and 22% core operating income growth.
Speaker Change: With our margin, reaching 38, 7% well under way to our goal of 40% plus margin.
Speaker Change: We also had important pipeline highlights in the quarter, including for Assembly and good Golly, which will go through in more detail later on in the call overall, we met and exceeded our full year guidance in 2024, and our continued confidence in continued growth in sales and core Op, Inc. In 2025 as Harry will outline later in the call.
Speaker Change: So moving to slide five our priority brands continued to drive robust growth in the quarter and I think importantly that demonstrates we have the replacement power to consistently grow through the end of the decade. Overall this portfolio of brands grew 38% in constant currencies and excluding Entresto grew 41%. So we feel.
Speaker Change: Very good about the momentum we have and this is what gives us confidence in the 5% plus sales guidance out to 2029 in the mid single digit growth. We believe we can deliver in the long term now moving to slide six.
Speaker Change: <unk> achieved sales of $7 $8 billion on the full year, that's up 31%. When you look at the left side you can see we had very good growth both in the United States and in our international market. The total prescriptions for Entresto in the weekly tiara in the U S continue to climb we had plus 41%.
Speaker Change: Growth in the United States with 9000 <unk> per week ex U S continued to perform well and I think importantly, we see very good performance in heart failure, as well as hypertension, and China and Japan.
Speaker Change: Now when we look at the outlook for Entresto, we've updated the markets that for forecasting purposes, we assume interests. So low in mid 2025 as you likely have seen our combination patent is upheld and we currently believe we will be able to secure pediatric exclusivity, though we will continue to monitor the situation closely and that enables us.
Speaker Change: To guide to a mid 2025 low output.
Speaker Change: Outside of the U S. Our RTP protection last call in November 2026, with a protection in Japan till 2030, and we continue to pursue additional options for further protection in these market I think when you think about forecasting entresto for the rest of the decade. It's important to note that the U S sales are about 50% of the global sales.
Speaker Change: But importantly, Europe contributes 20% in China, and Japan total in total of 15% of this brand.
Speaker Change: So moving to slide seven.
Speaker Change: Cosmetics top $6 billion of sales in the full year growing 25%. This was fueled by our new launches and Hs as well as the IV launch when you look at the fourth quarter, we had U S sales up 36% as mentioned by the key launches outside of the United States, We had 7% constant currency growth driven.
Speaker Change: Lead by volume in our core indications.
Speaker Change: Now when you look at how things are unfolding for the brand we remain number one the number one IL 17 in the U S dynamic market remains a leading originator biologic in both the EU and China now looking ahead, we plan to accelerate growth through the Hs launch with <unk> leadership, we have already established.
Speaker Change: The 60% and be Rx share and continuing to serve.
Speaker Change: <unk> reimbursement in our key markets now IV has started to see accelerated adoption in the U S. We have about 1625 accounts ordering we saw 22% quarter on quarter growth, but it's still early days and we're working through now really accelerating the IV adoption and over the course of the year, we expect to phase III Readouts.
Speaker Change: <unk> cell arteritis poly mileage I rheumatic that which if positive will provide further engines for growth for <unk> through the remainder of the decade now moving to slide eight.
Speaker Change: <unk> grew 49%, reaching $3 $2 billion on the full year. It was outpacing both the b cell and the EMS market. We're really pleased by the performance in the U S. And also very solid performance outside of the United States growing 42% in the U S with Trs growth at 29%.
Speaker Change: Outpacing the B cell segment, we see our <unk> share in the high <unk> and the B cell segment.
Speaker Change: Outside of the United States, we had 67% constant currency growth, which we're really pleased with overall, 70% of the new patients in the United States or first line or first switch at 80% of the U S. Commercial lives have been have enough first line coverage. So we're in a very good position that standpoint, and we're right now the number one <unk>.
Speaker Change: <unk> naive medicine in seven out of the 10 X U S market. So I think the setup overall for contempt looks really good very strong performance U S and ex U S and that gives us confidence in reaching the peak sales guidance that we've set out for this brand.
Speaker Change: Moving to slide nine our <unk>.
Speaker Change: <unk> grew 49% and the full year, reaching three $3 billion in sales and this is a reflection both of the strong performance, we're seeing in the metastatic setting and in the early breast cancer setting. So as you can see in the middle panel here.
Speaker Change: While the total brand <unk> across the market and you can see the significant increase we've seen in total brand MBR ex post the approval in early breast cancer and a positive end CCN guidelines. The brand grew 65% in the U S. In quarter four we have metastatic share at 50% now.
Speaker Change: And Trs share at 33% and climbing in the EDC setting the early breast cancer setting we have already reached 52% <unk> share within three months of launch and so we're getting very positive feedback from physicians and seeing solid uptake both in node negative and node one patients without risk factors.
Speaker Change: As well as the overlapping node, one and no two plus patient population I mentioned the category, one and CCM guidelines, which is really positive for the brand and importantly, as well we announced this morning that we've settled the compound patent litigation with a generic manufacturer and that supports <unk> U S patent protection until at least Q1.
Speaker Change: 2031.
Speaker Change: Outside of the United States, we grew 34% in constant currency with a leading share MBR extra at 42%.
Speaker Change: The early breast cancer launch is ongoing now in Europe, and other geographies and that should provide a further driver of growth for <unk> over the course of this year. So we guided to $8 billion plus and I think the early signals are clearly, indicating that we're going to be able to get there and hopefully do better than moving to slide 10.
Speaker Change: Victor delivered full year sales of $1 4 billion, 42% in constant currencies in the post tax incentives and most importantly, we spent a lot of our energy in quarter four laying the foundation for the pretax Amcs. It may have for launch, which we expect in the first half now when you look at the quarter. We grew you can see 28% over.
Speaker Change: For all our performance was absolutely in line with what we guided to in our quarter three conference call. Our U S was up 12%, we achieved 40% <unk> share within the vision population for Victor is now available in over 20 countries outside of the United States and we're confident that we can now accelerate growth with the PFT estimate for <unk>.
Speaker Change: <unk> in 2025, the final OS was read out over the course of January with the HR Unadjusted hazard ratio of <unk> 91, and you can see the confidence intervals here.
Speaker Change: File has been submitted to FDA.
Speaker Change: Last year in <unk>.
Speaker Change: <unk> is ongoing.
Speaker Change: So far there is no outcome plan for this brand. So I think that's really a positive signal and we will see now how quickly we can get the launch we have over 590 sites opened for the brand 350 sites are actively ordering and every month every week, we're adding more sites, we're getting more sites back to Lou.
Speaker Change: We're getting further into community oncology, which will set us up not only for <unk>, but our broader RLC pipeline over time, and we expect the initial uptake for PSM if were to come primarily from the depths we will get in these existing sites and then grow over time, certainly as we try to reach deeper into the oncology community practices.
Speaker Change: We're also progressing on our efforts to expand for Victor further and as well as our broader RLC expansion. The PSM addition, readout is on track for the second half of this year, we a predictor filings ongoing in China, and Japan and in both of those geographies as well, we've announced manufacturing facilities to <unk>.
Support the launch of <unk> and of course, Louis era, and we've also now initiated planning for our Actinium SMA six 107 phase III study. The first of two Actinium studies, we're now planning to move into phase III to have continued lifecycle management in prostate cancer with radio ligand therapies.
Speaker Change: Now moving to slide 11.
Speaker Change: Let me you showed a steady trajectory delivered 114% constant currency full year growth in the quarter at 83% growth versus prior year. We're really pleased that now in the U S. Our.
Speaker Change: Growth is outpacing the overall advanced lipid lowering market.
Speaker Change: Over 3000 health systems.
Speaker Change: <unk> now, let Theo that represents 68% of the overall market volume.
Speaker Change: Of depth, increasing and I think we're getting better and better traction with the overall buy and bill comfort levels within cardiology practices, we see demand growth in all relevant channels outside of the United States, we've seen robust growth as well as <unk> is now registered in over 100 countries, we see solid uptake in markets, such as Germany and in China, our out of park.
Speaker Change: <unk> growth really makes it one of the top ranked markets.
Speaker Change: Outside of the United States, we have an ongoing launch as well now in Japan. So looking ahead, we have a number of clinical stage readouts coming over the course of 2025, which will help I think round out the profile of <unk> as we await the outcomes trials Readouts in secondary prevention in 2022.
Speaker Change: 27.
Speaker Change: Now moving to slide 12, <unk> grew 68% for the full year with continued momentum in the third line setting and early progress that we're already seeing in the frontline setting.
Speaker Change: We're a market leader now in the third line CML setting with <unk> share of <unk>, 49% were three times higher than the nearest competitor, which I think shows how well established now somewhat is amongst hematologists outside of the United States. Our leadership is at 66% for NV Rx and total patient share in our key market.
Speaker Change: And when you look at the earlier line launch it was critical that we have already received and CCN category one preferred recommendation.
Speaker Change: November and then we also already see now somewhat as the fastest growing TKS teekay.
Speaker Change: <unk> share across all lines of therapy, and we're the market leader now in second line <unk> <unk> with a share already at 29% and Thats just in the first few months of launch so assuming we can really drive that continued trajectory, we should see very strong uptake overall for somewhat in the coming quarters. So we are confident.
Speaker Change: And the global first line opportunity, we read out the 96 week data.
Speaker Change: Recently, as well, which reinforces superior efficacy and I'll say more about that in a moment and then we also showed some very good data that showed on treatment discontinuation as well that doublets provides a clear profile win over a lot and they're.
Speaker Change: Going to slide 13.
Speaker Change: ASP of first 96 week data reinforced the superior efficacy and safety when you look at the data set here at 96 week on the left hand side of the chart you can see against all TKS. We continued to show a significant improvement, but statistically significant improvement in major molecular response.
Speaker Change: Lauralee versus Imatinib as significant improvement in major molecular response, and while we weren't powered our point estimate different against second Gen. TKS continues to improve as well over time, but when you look at the safety profile. We maintained a very excellent safety profile that we had at the earlier time point.
Speaker Change: It was great III, aes, aes, leading to discontinuation or aes, leading to dose interruption and excellent profile for the brands. So overall, we offer here a medicine that has high efficacy compelling safety and we believe over time as there's more and more experience will become the preferred agent in first second and third line for CML patients.
Speaker Change: Moving to slide 14.
Speaker Change: Now turning to fab haul tells you well if <unk> is now launched in two indications in <unk> and again, while it's early days I think we see really solid steady performance for this brand of 23% volume growth in <unk>. Most of the source of business at the moment is switched patients from the established therapies, we see leap over 90.
Speaker Change: Percent of patients staying on therapy after they're continuing after their first we felt very good commercial coverage level. We're approved now in 40 countries and so step by step as well we're progressing the launch in other geographies. The early signs for the <unk> launch as well are very encouraging we've seen strong access with 67% commercial coverage already.
Speaker Change: Our label, we're seeing a number of Nephrologists a sizeable number of Nephrologist completing rems certification and we also see a high interest in our conversations with opinion leaders on the top of the MLA.
Speaker Change: One other update we have as well for fab Paul says that the <unk> filing was completed in quarter. Four we received priority review. The FDA has confirmed no AD comm for <unk>. So we're now preparing for a launch in the first half of 2025.
Speaker Change: So moving to slide 15, so when you look across the full year I think we delivered very good innovation momentum across regulatory decisions submissions readouts and phase III starts obviously the critical approve.
Speaker Change: Approvals were delivered upon particularly the kits golly early breast cancer also approvals the filings to Victor.
Speaker Change: And the approval for assembler. So I think we really are looking forward to maintaining and continuing that momentum in the year to come one important readouts that we did have in quarter four.
Speaker Change: Turning to slide 16 with for the <unk> study for <unk> 101. This is the interest fecal version of <unk>.
Speaker Change: It is administered <unk>.
Speaker Change: Roughly 110th of the dose of what we see in the IV administration. This was tested in children and young adults over two years of age.
Speaker Change: We're really pleased to see that we met the primary endpoint for an increase versus baseline for the Hammersmith score HFF.
E, which is the gold standard not all of the therapies in this space have been tested against the Hammersmith scores. So we chose the gold standard and we demonstrated that we met the primary endpoint of a statistically significant improvement versus a sham or placebo.
Speaker Change: Requested by FDA, a very favorable safety profile consistent with what we've seen.
Speaker Change: Other setting we're looking forward to present the data at an upcoming medical Congress you can see the study design over on the right and our goal here will be to try to secure broad indication across the various age levels and looking forward then to advance this global regulatory submissions across our various across the various geographies a sizeable number of pay.
Speaker Change: <unk> have not had the opportunity to benefit from Xeljanz, Bob in the first six months of life.
Speaker Change: And now we're really excited now to give those patients a very compelling onetime treatment option that can hopefully stabilize and potentially improve their disease.
Speaker Change: Now moving to slide 17.
Speaker Change: We also completed an exciting deal in our neuroscience pipeline. This is for vote of planned PTC $5 <unk> as a potential first in class oral disease modifying therapy for Huntington's disease, we have a lot of expertise in oral splicing agents, we had a molecule called <unk> 070, which ultimately did not progress.
Speaker Change: Because of peripheral neuropathy signals that we had during the development program. So this is a space, we know well and we really believe PTC 518 has a very strong profile as evidenced in the interim readout of the phase III study as you know in Huntington's disease, very fatal fatal neurodegenerative diseases.
Speaker Change: Really no disease modifying therapies at the moment prevalence is 37000 in the U S and 28000 Teu. So we have an opportunity hopefully to make a big difference we would expect the phase III readout for this study in the first half of 2025, and then moving to pivotal phase III studies thereafter.
Speaker Change: Moving to slide 18.
Speaker Change: So our goal will be to continue our innovation momentum in 2025, we outlined to meet the management, we have a deep and broad pipeline across our four therapeutic areas across our key.
Speaker Change: Platforms and our goal now is to advance the next wave of therapies. Both in terms of approvals and submissions you can see the list here, but also readout in study initiations, which will really fill up that mid stage pipeline and then allow us to maintain our growth momentum well into the 2000 <unk> and beyond.
Speaker Change: Moving to slide 19, and to close I just wanted to remind you of our confidence in our midterm guidance, 5% plus sales growth out to 2029% and a 40% core margin by 2027, we're very comfortable that we can with our replacement power outpaced the gx impacts that we have to 2029.
Speaker Change: Exciting.
Speaker Change: Market growth drivers, many of which have protection well into the 2000 <unk>. We have the pipeline probably lies in our hopefully with positive clinical data and approvals that pipeline will become further unprofitable eyes medicines like Remy brewed nib.
Speaker Change: <unk> appellate Carson natural sense and can further drive the growth profile of the company. So an exciting year, we're really excited by our performance in 2024 and excited about continuing delivering the strong results and strong innovation delivery into 2025, so with that I'll hand, it over to Harry.
Yes. Thank you good morning, and good afternoon, everyone.
Harry: I will talk you through our financials for the fourth quarter and full year 2004, which as Lance mentioned has shown some of the strongest performance in our history.
Harry: As always my comments refer to continuing operations and growth rates in constant currencies, unless otherwise noted so starting on slide 21, giving a bit of context.
Harry: It started in 2024, which is here on the far right of each of the three charts.
Harry: What is really our first full year as a pure play innovative medicines company and we continue to show a strong track record of sales growth with margin expansion.
Look back over the last five years, we have grown sales at a 7% CAGR and cooperating income at a 15% CAGR through consistent strong commercial execution and overall significant progress on operational productivity. This has resulted in core margin expansion of 11.
Harry: 100 basis points in constant currencies, putting us on a clear path to achieve our midterm margin guidance of 40% plus by 2027 I think when you look at this track record it becomes very clear that we have lifted the competency company to a whole new level of sales Mark.
Harry: And as we will discuss later our free cash flow.
Harry: Moving to slide 22.
Harry: We guided to low double digit sales growth for full year 2024, and we achieved 12%. So meeting our guidance for core operating income, we delivered 22% growth exceeding by one notch our guidance, reflecting strong momentum we have seen our priority brands. Good also and launches.
Harry: As well as cost discipline throughout the end of the year.
Harry: Including some productivity gains.
Harry: On slide 23, you'll.
Harry: Youll see a summary of our financial performance in the quarter sales were up 16% and cooperating income increased <unk>, 9% core EPS was $1 98 up 33% to note in quarter four we benefited from some gross to net favorability mainly in the U S. This added.
Harry: About 3% points of close to quarter four from crossing that true ups based on invoices for prior quarters in 2024, so the underlying growth in quarter four has been a very strong 13% slightly better than the 12% sales growth for the full year 2024.
Harry: For the full year core margin expanded 330 basis points versus prior year.
Harry: Currencies to reach 38, 7% core EPS was $7 81 up 24% and free cash flow grew 24% to $16 3 billion a record high for Novartis.
Harry: Speaking of free cash flow, let's turn to the next slide you can see free cash flow generation has really accelerated since we completed our transformation into a pure play pharma company end of 'twenty 23, and also finalized our transformation program transformation for growth program, which we announced.
Harry: 22. This has been a focus for us to of course ensure that not only cooperating income increases, but appropriately also free cash flow. So a high quality of core earnings.
Harry: Free cash flow generation.
Harry: And in.
Harry: In fact, we have generated more cash than we did as combined business appeared with Xanders, a few years back even with outcome.
Harry: This gives us also ample capacity of course to reinvest in the business pursue bolt on deals under the term <unk>.
Harry: <unk>.
Harry: A director free to our shareholders, while our growing dividends and buybacks.
Harry: This brings me to my next slide so we continue to execute in line with our shareholder friendly capital allocation strategy, which balances the priorities I mentioned, the invest over $9 billion in R&D.
Harry: 2024, and completed more than 30 bolt on deals.
Harry: Over the last two years to strengthen our pipeline, particularly in the area of neuroscience RFG in Reno with.
Harry: With respect to returning capital to shareholders, we remain committed to consistently growing our dividend in Swiss francs per share and completing our ongoing share buyback, which is about $5 4 billion instead to be executed in 2025 2025 no onto the next slide please.
Harry: So the dividend so we are.
Harry: Really pleased to propose the 28th consecutive dividend increase to <unk> 50 per share an increase of 6% in Swiss francs and 'twenty after.
Harry: After the prior few years have tended up per year.
Harry: No we did not rebased, our dividend for the spin off of Sandoz nor outcome. So this represents really an attractive consistent growth over time in line with our commitment to our shareholders.
Harry: Moving to slide 27.
Harry: For full year 2025, we expect continued strong sales growth with margin expansion with sales growing mid to high single digit and core operating income growing high single to low double digits embedded in our guidance as the financial planning assumption that Sigma Promacta and domestic U S.
Harry: Entry occurs in the middle of 2025, and I'll give some more detailed unexpected half one half two dynamics on the next slides to complete our full year guidance. Please note that we expect core net financial expenses to be around 1 billion and our core tax rate to be around 60% to 65%.
Harry: On slide 28.
Harry: We have shown illustrative Felipe how we expect half one half two dynamics should generics for Intest with Cigna and Promacta engine in U S. In the middle of 2025 as per our financial planning assumption overall, we expect continued strong volume growth from priority brands in 2025.
Harry: <unk> and.
Harry: One we expect sales to grow low double digits, while we expect of course, the softer half two two to the impact of the street potential generic entries.
Harry: With low to mid single digit sales growth. Likewise, we expect half one core op, Inc to grow the high teens low to mid single digit growth in half two.
Harry: And I'll finally, let's have a quick look at the currencies.
Harry: They always move around and if late January rates were to prevail for the remainder of 2025, we would expect the full year currency impact to be a negative 2% on sales and a negative three percentage points of cooperating income as a reminder, we always provide an estimated impact of exchange rates on our results on a month.
Speaker Change: The basis on our website and with that I'll hand back to us.
Speaker Change: Terrific. Thank you Harry so coming to the final slide and it really just in summary continued strong business momentum in quarter, four and one of the best financial performances in the Companys history met and exceeded our full year guidance, we are advancing our pipeline, including new approvals, but importantly, readouts for assets that will fuel our mid to long term growth and really ensuring we advance.
Speaker Change: Mid stage pipeline and then expect to continued strong sales growth with margin expansion in 2025, as Harry I outlined and we remain on track to deliver our midterm guidance of 5% plus sales growth through 2029, so with that Sharon we can open the line for questions.
Speaker Change: To ask a question you will need to press star one on your telephone and we feel name to be announced please limit yourself to one question I'll return to the queue for follow ups to withdraw your question. Please press star one on one again.
Speaker Change: We will now take the first question.
Speaker Change: And your first question comes from the line of Seth that as from Bernstein. Please go ahead.
Speaker Change: Good afternoon. Thank you very much for taking my question a.
Speaker Change: A quick one on the guidance.
Speaker Change: As to guidance is that it would be better than expected on the top line, but also.
Speaker Change: On the margin and as Entresto is a very profitable product and that you will lose.
Speaker Change: Attempt in Europe generics from mid of this year, but just wondering if you could elaborate area.
Speaker Change: All of the.
Speaker Change: Where we should see some pressure and where you will have some growth that will affect.
Speaker Change: Sure.
Speaker Change: On the P&L line, but the top line. Thank you.
Speaker Change: Thanks Lauren.
Speaker Change: Hello all.
Speaker Change: And I'll start with the topline as we all know in the pharma business. So having a mid to high single digit sales growth given the strength of our growth brands and launches and there is a good starting base and also other products are quite profitable now of course profitability does vary by the different brands, but overall.
Speaker Change: With the mid to high single digit sales growth and our ongoing resource allocation and productivity programs. We are very confident that with that we will have also some some moderate margin increase.
Speaker Change: From that standpoint, and I laid out half one we've been more obviously and if these generics would enter half two would be basically pretty much low to mid single digit both in top and bottom line, that's fine, but overall very confident in that say its growth with these assumptions as well as the under.
Speaker Change: <unk> volume growth when you look at it right 14, 15% volume and then it depends a bit <unk>.
Speaker Change: What's quite neutral.
Speaker Change: Last year, and then it depends on pure generic assumptions, there, but also with a 5% very confident in the 5% CAGR over five years.
Speaker Change: And then of course from 38, 7% to 40% plus it's not that far.
Speaker Change: In 2027, but we have good ongoing productivity and therefore, especially on SG&A with good resource allocation and the launches are mostly in areas, where we have already strong presence, we would expect SG&A to grow below sales growth.
Speaker Change: As you have also seen in the prior two years.
Speaker Change: Thank you for thanks, so much alright. Thank you.
Speaker Change: Thank you. Your next question comes from the line of Simon Baker from meta in Atlantic. Please go ahead.
Simon Baker: Thank you for taking my question and just kind of a continuation for phones question.
Simon Baker: Mindful of the loss of exclusivity potentially for Entresto later in the year.
Historically, you've been very good at.
Managing gross margin through patent expires I just wanted to kind of you don't you don't guide on gross margin if you could just.
Simon Baker: Give us any any commentary around the Brazilians the gross margin in 2025 and license activated thanks, so much.
Simon Baker: Eric I think Simon so as I've mentioned on prior calls in.
Simon Baker: Our roadshows.
Simon Baker: To further margin improvement I expect.
Simon Baker: But is it fully come from SG&A as we with good resource allocation.
Basically slightly grow SG&A, but but significantly below sales growth.
Simon Baker: Gross margin comes a little bit under pressure as we lose small molecules.
Simon Baker: We don't pay royalties with either small molecules, where we pay some royalties or larger molecules, but all of that will be more than offset by the SG&A.
Simon Baker: The efficiencies I don't know of course also all our colleagues in manufacturing and supply chain and continue to work on a very good productivity programs and have cost reduction programs on each of our products at a very impressive way of course never compromising quality always apply very high at 99, 5% plus supply.
Customer service levels, and with that a little bit pressure on the gross margin because of increased royalties, but by far compensated from SG&A efficiencies.
Simon Baker: Alright. Thanks, so much thanks, Simon next question.
Speaker Change: Thank you. Your next question comes from the line of Matthew Weston from UBS. Please go ahead.
Simon Baker: Yeah.
Speaker Change: Hello, Matthew are you on mute.
Speaker Change: Due to no response I'll move to the next question one moment please.
Speaker Change: Your next question comes from the line of Richard Parkes from BNP Paribas. Please go ahead.
Richard Parkes: Alright, Thanks for taking my question.
Richard Parkes: One on the Huntington's program, obviously huge unmet medical need terrible disease.
Richard Parkes: But there have been some of the failures in that area or in the past. So I'm just wondering what makes you more confident in the approach what you've learned from those.
Richard Parkes: Past experiences and to what degree do you think that pivot IHT trial will de risk the probability of success given it for slowly progressive disease and the study is relatively short.
Richard Parkes: Will we still be thinking into harvest program pumping really helpful. Thank you.
Richard Parkes: Yeah. Thanks, Thanks, Richard and I think as you are aware the goal here is to take down mutant Huntington.
Richard Parkes: At a level, where you're not taking it so low that you have some you have adverse consequences from reducing huntington's too much I mean generally speaking the.
Richard Parkes: Ceiling in the field as you wanted to reduce mutant Huntington protein by 30% to 50%.
And then alongside that biomarker or do you want to see clinical signs of improvement. So I think that there are interim results PTC has shown the relevant MHC lowering they've seen some signals of clinical efficacy and a very good safety profile without some of the peripheral neuropathy is that we saw in our own program. So I think all.
Richard Parkes: All of that taken together makes the program look like it's headed in the right direction I think the big question of course, it does reducing a mutant huntington at that level lead to large enough for important enough clinical benefit that would lead to most of them probably helping patients, but also regulatory approval I think we will see how the fees.
Richard Parkes: To be study reads out obviously, if it's a very compelling results it might enable us to take it forward for a filing and if not we would then need to go to a full pivotal study and then really answer the question does reducing mutant Huntington.
Richard Parkes: At that level lead to clinical benefit that one would one would hope so it's been I think PTC has developed a product in all the right ways they've had good dialogue with the regulators. So we're hopeful that we see a good result on the phase <unk> study and then we will take over and run those phase III studies and hopefully we can bring in important first.
Richard Parkes: Disease modifying therapy to these patients who badly needed.
Richard Parkes: Thank you. Thanks, Richard next question operator.
Emily Field: Your next question comes from the line of Emily Field from Barclays. Please go ahead.
Emily Field: Hi, Thanks for taking my question. The first one was just a clarification question from the first question that was asked by you.
Speaker Change: And just to confirm the contribution of favorable question adjustments to sales and Q4 'twenty four.
Speaker Change: And then I just wanted to ask a question about <unk> I mean, I know the guidance had been.
Speaker Change: Not to expect significant sales growth.
Speaker Change: The additional indication okay SMA for without it but was there any particular driver between the sequential.
Speaker Change: Klein in the U S quarter over quarter and.
Speaker Change: Would you expect any of the DTC and promotional efforts that you've been putting in place to have an impact on sales ahead of the TSMC for approval. Thank you.
Speaker Change: Yeah. Thanks, <unk>, so back on the guidance here.
Speaker Change: Your question was around accruals to net quarter for impacting the guidance.
Speaker Change: So let me try and then you can tell me if it was sufficient so we had.
Speaker Change: We had a growth of 16% in quarter four as you have seen in constant currency about three points of that was due to true ups of gross to net for prior quarters of 2024, so underlying 13% to full year sales by brand in 2024 is basically under stored at the underlying.
Speaker Change: Growth for 'twenty, four is 12%, but as Youll see the report so if you want to have a basis.
Speaker Change: To take the full year 2024 sales.
Speaker Change: And these are undistorted overall now of course that has lifted the overall 2024 sales and.
Speaker Change: We have we are of course computed that if you will into our 2025 gross to net calculation.
Speaker Change: And a key element of this is really Medicaid utilization.
Speaker Change: Continuously reduce it.
Speaker Change: To pre pandemic levels now, we do not assume that it gets lowered lower we basically assume that in 2025, we see what we have seen as the latest for 2024.
Which is a reasonable assumption so we never take riskier assumptions on gross to net it is obviously, a big big part of money <unk> $16 billion to $20 billion of saves as we have like 50%.
Speaker Change: Of our U S list prices, the gross to net but from that standpoint.
Speaker Change: As has lifted.
Speaker Change: A more favorable gross to net situation for 2024 hour sales level and from that we expect to grow mid to high single digits.
Speaker Change: That clarifies your question.
Speaker Change: And then Emily Thank you.
Speaker Change: Victor.
Speaker Change: When you look at it in Q4 was really in line with what we had expected in Q3, we had the benefit of some one time adjustments in France, and Germany, but.
Speaker Change: But then when you overlay all looked at where we had guided for Q4, it's roughly exact governments exactly with where we had expected now I think looking ahead. We are hopeful to see further progress in the vision population, but I think that will be.
Speaker Change: Not not a rapid increase I think we've already gotten to 40% and be Rx share and now we will need to get to steady gains by expanding further and further the number of treating sites with vision population, but it is possible certainly that the DTC will start to have an impact that we kicked off in quarter three of last year, you usually takes six months for DTE.
Speaker Change: To have an impact so it would be around February March of this year, we might see some impact on the vision population, but really our organization's focus is on the <unk> launch I think now that we have a really compelling our PFS data, we have very compelling data on distance.
And Matt we have now the OS.
Speaker Change: Unadjusted for crossover at nine one I think everything now is a good setup to go into a population. That's three times larger really ensure the sites that are already using flue Victor now fully maximize their capacity to get as many patients to benefit from the therapy as possible and also accelerate our efforts to get even more sites ready in the.
Speaker Change: Community, we've launched a number of initiatives launching a few more over the course of the quarter to really simplify and hopefully get clinicians very comfortable even in the community oncology setting, providing radiopharmaceuticals or radio ligand therapy, that's where I think we're going to see the next uplift for the brand.
Speaker Change: Next question operator.
Speaker Change: Thank you. Your next question comes from the line of Matthew Weston UBS. Please go ahead.
Speaker Change: Thank you I don't know what happened earlier.
Speaker Change: Question for Harry.
Speaker Change: Again about guidance, Harry but particularly about the impact of Medicare part D reform on what you've assumed within your growth. So one of the questions. We've had a lot. This morning from investors is how can you be so confident given that you have a very large oral oncology portfolio, which is assumed to be used.
Speaker Change: Largely in the Medicare part D population. So what have you assumed in your outlook the puts and takes around that portfolio from that reform.
Speaker Change: Yeah, Thanks, Matthew I'll actually take take that overall, we expect a modest headwind from the part D reforms and we fully factored that into our guidance. The two brands, where we see the biggest impact of the reforms primarily paying into the.
Speaker Change: To cover in the catastrophic phase are for Concentrix and Kiss Golly.
Speaker Change: But overall when we look at it we factored in the expected modeled headwinds from that we look at the potential volume uplift, which we don't really put a lot of stake in yet because we would really like to see how that ultimately unfolds over the course of this year and we see a modest headwind, which we think we can manage fully and thats incorporated into our guidance.
Speaker Change: I think we will see I think in the midterm.
Speaker Change: Policy should lead to volume uplift more patients staying on therapy, which is why the industry wanted to 2000 out of pocket cap and that would ultimately of course.
Speaker Change: Improved patient compliance staying on their medicines and ultimately impact positively impacted sales in the coming years. In this first year I think it's hard to put much credence on that but beyond that we feel very comfortable with the modeling that we did we think we've taken an appropriately conservative assumptions.
Yeah.
Speaker Change: Thank you.
Speaker Change: Next question operator, Thanks Matthew.
Speaker Change: Thank you. Your next question comes from the line of Richard Vasa from Jpmorgan. Please go ahead.
Hi, Thanks for taking my question a question on pause currently.
Speaker Change: Looking at the Edinburgh share in metastatic it stay that sort of 50%.
Speaker Change: Quarters. It may be a couple of years now so I'm just wondering what it takes to to change that you have a superior product does the.
Speaker Change: The Halo effect from the adjuvant.
Speaker Change: Allow you to get more accounts on board just can we see that displacement is on <unk> just your thoughts thanks very much.
Speaker Change: Yeah. Thanks, Richard I think that gets golly shared really started to gain in the first part of last year. We know after we had the early breast cancer readout in the led to a lot more confidence overall in the brand as well as the <unk>.
Speaker Change: CCN guidelines further supporting the use of <unk> Golly I think now we are hopeful that with the early breast cancer readout and then the opportunity to have a single medicine for all patients within a clinic that we can drive the overall share.
Speaker Change: <unk> share of higher than 52%, we do have a cap probably somewhere around 75% to 80% just because of some of the payer dynamics.
Speaker Change: And some of the <unk>.
Speaker Change: Contra indications for kids Golly, but of course, our goal is to get from that 52% as high as we can to that 75% over the coming years of course, we have plenty of time now to do that and I think we should see steady gains over time on that one but the biggest focus for US right now is maximizing the opportunity in the.
Speaker Change: <unk> zero and node, one patients without risk factors, where <unk> uniquely labeled and our competitors are not in our ability to get those patients diagnosed and then ultimately on therapy as such.
Speaker Change: The sizable population and the size of the obviously the public health benefit we can deliver that.
Speaker Change: The core focus for us overall, and then with that of course, we should see metastatic gains as well.
Speaker Change: Yeah.
Speaker Change: Thank you next question operator. Thank you. Your next question comes from the line of Graham Parry Bank of America. Please go ahead.
Graham Parry: Alright, Thanks for taking my question.
Graham Parry: Interest and just wanting to get perhaps a little bit more detail on the dynamics of the factored into the guidance for 2025 say what sales progression you're looking at worldwide.
Graham Parry: In the U S and in the U S TCA benefit in the first half of the year.
Some downhole discount removal and to what extent does that offset some of the generic decline you should get in the second half of the year.
Graham Parry: On generics and how confidence how you can hold off interests stage next until 16th of July and the court filings.
Graham Parry: Adjusted MSN is trying every which way to launch at the moment and is there any wanted to stay in place at blocking them from doing that.
Graham Parry: Are you confident they haven't shipped any products at all in that narrow window that wasn't actually a stay in place a couple of weeks ago. Thank you.
Graham Parry: Yes, Thanks Graham on the overall dynamics.
Graham Parry: Overall.
Graham Parry: We would expect continued good growth.
Graham Parry: Entresto until fall.
Graham Parry: From a forecast assumption standpoint.
Graham Parry: Middle of the year of course, our colleagues in the legal Department will do everything to appropriately defense further papers.
Graham Parry: Now to the financial forecast assumption and so we would see growth on that and yes. You are right. There are some favorability.
Graham Parry: From a Medicare part D. You sign on Entresto as it is not a very high price specialty product, so very positive dynamics as expected.
Graham Parry: Louis would happen in the U S and then of course, but what actually when we look at multi year outlook and forecast and Tesla is one of the products is really on the forecast with our models from from the consensus due to the fact that Europe at least end of 'twenty, six Japan 2030 and.
Graham Parry: Then we have a large.
Speaker Change: Product almost a large even small molecules in emerging markets. So also there are quite a lot of let's say remainder.
Graham Parry: Of sales.
Graham Parry: Because of Japan should be a blockbuster and then emerging markets once even end of 'twenty six Europe.
Graham Parry: See generic entries.
Graham Parry: And of course, we are pursuing all options in Europe and Japan.
Graham Parry: Ensure we maximize.
Graham Parry: Exclusivity for Entresto in those geographies and they are certainly options.
Graham Parry: <unk> materialize.
Graham Parry: I think on the U S dynamic to our to our knowledge and our and our best.
Graham Parry: Understanding there were no products shipped into the into the channel in those few hours.
Graham Parry: Stays in place MSN has requested a reconsideration of the circuit courts stay.
Graham Parry: And of course, we'll monitor that situation, but we believe it's very clear that.
Graham Parry: The spirit of the law very much is that we did our pediatric exclusivity studies.
Graham Parry: Those pediatrics pediatrics six months.
Graham Parry: Tension on the combination patent, which has been upheld should be respected and so that's our very clear position. We of course continue to litigate out the morpheus complex patents as well as the lawsuit do we have that the FDA should not have approved.
Graham Parry: <unk> with a carve out on the dose dosing regimen on the label. So those court cases also continue to go on over the course of these months and we'll see how it unfolds our best estimate at the moment is to give you that forecast and guidance of middle of the year and if anything changes either we or I think IPD, we will let you know.
Graham Parry: It probably IPD sooner than us, but we do the best we can.
Graham Parry: So thank you very much guys next question.
Graham Parry: Thank you. Your next question comes from the line of <unk> from BMO capital markets. Please go ahead.
Speaker Change: Great. Thanks for taking my question I had a couple of inbounds. This morning, just wondering if you had any additional commentary you could provide on the push out of the horizon phase III, maybe what could be driving that day event sort of rate dynamic relative to your initial event rate assumption. Thank you.
Speaker Change: Yeah. Thanks <unk>. So this is an event driven study we've been modeling the event rates I think I've also heard a few questions. There has been no interim analysis does not know interim analysis drove this this is just event rate modeling on the blinded event rate that we saw.
Speaker Change: And.
Speaker Change: We expect now to reach the final number of events.
Speaker Change: I always preferable for a cardiovascular study that we need to ensure that adequately powered and the first part of next year.
Speaker Change: Have a good necessarily gas I mean in general I would say cardiovascular outcome studies have been trending to lower event rates under time over time, it's important to notice that in these studies, we very rigorously ensure that all patients are at their appropriate treatment levels for LDL lowering.
Speaker Change: To ensure that we can isolate the impact is FDA access of the <unk>, a little a lowering therapy, so quite it could be the background rate it could be the drug is working that's always our hope, but we can't we can't be sure of that as well. So we'll see over the course of we'll.
Speaker Change: We will see next year at the end.
Speaker Change: How that study reads out, but we remain very confident that the drug is doing what it's supposed to do mechanism of action is clear when.
Speaker Change: When we look at the profile of the patients that we enrolled this is the high risk patient population, we wanted to enroll our high levels of LP Little a then with the lowering that we we are seeing that we expect to see that that.
Speaker Change: It should lead to the cardiovascular risk reduction that we hope for.
Speaker Change: So that's the best best guidance I can give you at this point in time.
Speaker Change: Great. Thank you I appreciate the color next question operator.
Thank you. Your next question comes from the line of James Quigley from Goldman Sachs. Please go ahead.
James Quigley: Alright, Thanks for talking my question kind of on the guidance. Unfortunately.
James Quigley: How are you would you be able to sort of split the guidance out between volumes generic impact on pricing I mean, presumably pricing is close to zero or slightly negative.
Speaker Change: Super helpful. If you could give us an idea of how that breaks down and then secondly on the slide.
Speaker Change: When you break out the half one half two you almost maybe the second half.
Speaker Change: It takes a hit because of generics where would that run if you didn't have a generic impact and is low to mid single digits.
Speaker Change: Sort of sensible exit rate for the second half for your guidance to the end of.
Speaker Change: I appreciate it.
Speaker Change: Individual years.
Speaker Change: Just some color would be really useful.
Speaker Change: Yeah, Thanks, James here.
Speaker Change: Okay.
Speaker Change: Given the trial.
Speaker Change: So overall, we expect continued if not slightly increased volume growth due to our launches and continued very good execution from a volume standpoint.
Speaker Change: Yes.
Speaker Change: <unk> probably will be.
Speaker Change: Little bit more pressure, usually we have a year like 1% to 2% points negative last year and 24, we had flat.
Speaker Change: But there's a little bit of gross to net pressure loss due to Medicare part D redesign, but nothing dramatic there and the key impact will be an increased generic. According to this forecast assumptions now for the U S. We have taken simply unlocks for small molecules into different categories.
Speaker Change: Maurice cardiovascular as well.
Speaker Change: Encore and Thats, what what you can model yourself now these three.
Speaker Change: We would not happen.
Speaker Change: We expect the first half to look like the second half.
Speaker Change: Currently there there is not an unreasonable assumption they will happen.
Speaker Change: So that's why.
Speaker Change: We carefully modeled this.
Speaker Change: Okay. All right. Thanks, Jami next question operator.
Speaker Change: Thank you. Your next question comes from the line of Seamus Fernandez from Guggenheim Securities. Please go ahead.
Speaker Change: Great. Thanks for the question so my.
Speaker Change: My question is on <unk>.
Speaker Change: Guys have chevron's data coming this year and my understanding as well as some additional phase II and III datasets.
Speaker Change: Where are you most excited about the opportunity for <unk>. It would strike me that <unk> has the highest unmet medical need where.
Even just a positive study would gain substantial utilization.
Speaker Change: Trying to get a better understanding of how you're thinking about the market opportunity in <unk> and then more broadly for you Matt. Thanks, So much.
Speaker Change: Yeah. Thanks, Jamie So we are very excited about <unk> potential both in hematology and immunology.
Speaker Change: In immunology clearly the sjogren will be the first key foundational readout.
Speaker Change: Letting us in the roughly 40% of patients who have systemic manifestations.
Speaker Change: Shoguns disease and the phase <unk> study, we demonstrated for the first time, a significant improvements in the di which is focused on the systemic manifestations, including improvements in areas such as fatigue.
Speaker Change: And other physician assessed parameters.
Speaker Change: So if we can get a positive read I will try to get as broad a label as we can and we're also assessing should we also study the medicine over time in those patients the remaining 60% of patients a subset of them, who primarily have symptom manifestations without the systemic manifestations. So I think there is.
Speaker Change: Significant opportunity NHS then of course following up on that we have the systemic lupus and lupus nephritis studies as well running and as well as you note the phase two b.
Speaker Change: In hidradenitis alongside that I think while there is a reasonable standards of care and idiopathic thrombocytopenic.
Speaker Change: I hope you can hear appropriate ATP.
This medicine also has the potential with its mechanism to be an improvement in second line and first line <unk> and <unk>.
Speaker Change: We also have a readout.
Speaker Change: In 2025, as well and so that would also enable us to start start the process in hematology. We have worked through ensuring we have a different dose levels as well. So we can manage the different indications in immunology and hematology from a price standpoint, so taken together I mean, you have six phase III studies across the board.
Speaker Change: <unk> already running triangular mad multiple phase twos.
Speaker Change: So assuming that they go our way this could be a very significant medicine, probably underappreciated overall.
Speaker Change: Next question operator.
Speaker Change: Thank you.
Speaker Change: Our next question comes from the line of <unk> from <unk>. Please go ahead.
Speaker Change: Hi, there thanks for taking my question.
Speaker Change: Just one on <unk>.
Speaker Change: Sensitive currently modeling very little if anything at all.
Speaker Change: 101 can you help us think through the bolus of TNT and the speed of ramp up.
Speaker Change: We think it can be a blockbuster by 2027.
How do you think about the speed of ramp up.
Speaker Change: Yes, I think sooner so I think it's that.
Speaker Change: Obviously early days from our standpoint, but certainly with I can use the analog of what we saw with Xeljanz mind certainly in that case, we did see a very fast ramp and then to the steady state and then we stayed at that steady state I think it was two three years and so we got to the steady state and Thats generally what we would expect I think in the K.
Speaker Change: A gene therapies, and so I think we will see with OE via the dynamics, obviously, a little bit different because many of these patients will need to be switched patients, but I think when you look at the <unk>.
Speaker Change: <unk> said that were going up against you have a competitor that requires quarterly interest equal administrations into the spinal cord, which is quite challenging for patients.
Speaker Change: Over time and also patients often have.
Speaker Change: Malformations deformities that happened in the spine is a result of the repeated injections.
Speaker Change: And then the other competitor medicine was not tested with the standard of care Hammersmith score, which is the gold standard which is what we used and I think our hope is by going to the physician and patient population, saying look you have a onetime gene therapy using the gold standard Hammersmith score demonstrating.
Speaker Change: A statistical significant improvement using that score with a very expected safety profile that could be very compelling for a large number of patients.
Speaker Change: That's the approach we're going to take enrolling the medicine out.
Speaker Change: And I'm hopeful that it will surprise people as well because I think there is the opportunity as we guided this could be overall, a $3 billion plus medicine over time, and that's very much the goal and I think also of course with gene therapies. We have the opportunity to have medicines that are don't at least at least are on our current understanding would be difficult to face real.
Speaker Change: Generic erosion. So these become medicines that kind of stay in the long run in our portfolio.
Speaker Change: So thanks <unk> next question operator.
Speaker Change: Thank you. Your next question comes from the line of Eric Berg.
Barriga: Barriga from Stifel. Please go ahead.
Eric Berg: Yes Hello.
Barriga: Yes go ahead, Eric yes.
Barriga: Hi.
Speaker Change: Again on guidance, but this time on the midterm guidance and trying to put.
Speaker Change: The 25 guidance in the context of midterm guidance since you implemented this midterm guidance you systematically beaten race <unk>.
Speaker Change: 'twenty three with much higher 24 was much higher.
Speaker Change: <unk>.
Speaker Change: Then we thought that maybe the transition with the significant eloise in 'twenty five 'twenty six would be the reason.
Speaker Change: For the midterm guidance to be lower than what you achieved now in 25 Youre guiding for mid to high single digit which is again higher than the midterm guidance and so if we think that 26, we will very much looked like 25, because it's a 50 50 meter 'twenty five 'twenty six impact and then 2000 700000.
Speaker Change: <unk> should see some rebound with no significant annually it becomes hard to understand why the midterm guidance.
Speaker Change: Not.
Speaker Change: More let's say higher.
Speaker Change: Let's say to articulate things, so maybe something is missing but could you put that in some context or just.
Speaker Change: The global policy of under promise and over deliver thank you.
Speaker Change: No. It's certainly not a global policy, we do our best to give you the midpoint estimate of where we think things will go and then of course, if we do better and over the last two years I think our performance operating performance has been outstanding in Q2, two plus years now.
Speaker Change: And I think Thats part of the reason that you've seen that consistent.
Speaker Change: Beats and raises.
Speaker Change: I think certainly over the coming years, we will see I mean, we of course will update over time I mean, the 2026, we have the full year impact of course of.
Speaker Change: These generic generic entries, and then will clear them and accelerate growth.
Speaker Change: From there so I don't think we're in a position at this moment to change our midterm guidance, but obviously, if we consistently perform at a higher level than the 5% midterm guidance, we'd have to reconsider it but I think right now our focus is delivering 2025 per plan getting these launches up on the trajectory closing the current GAAP.
Speaker Change: That consensus has two our view, which I think is roughly two points 20.
Speaker Change: <unk> to 'twenty nine so I think Eric you are there, but some of your colleagues or not and so I think that getting that gap close by showing confidence in his golly inlet.
Speaker Change: Victor in some blips in fab halt.
Speaker Change: With the Remy brute nib launch with some of the pipeline delivery continuing delivering on <unk>.
Speaker Change: And then of course, we will reconsider the midterm outlook as appropriate.
Speaker Change: Next question operator.
Speaker Change: Thank you as a reminder, if you would like to ask a question. Please press star one on one on your telephone keypad.
Speaker Change: Your next question.
Speaker Change: It comes from the line of Richard Parkes from BNP Paribas. Please go ahead.
Richard Parkes: Hi, Thanks for taking my follow up.
Richard Parkes: It's just on Concentrix, the competitive environment and we've now had been on the market for a year or so I believe that has some recent formulary wins.
Richard Parkes: <unk> launching in the height chassis indications. So just wondering how that competitive environment is playing out.
Richard Parkes: And what you anticipate in your guidance and maybe if you could quantify the opportunity for Concentrix in the new indications that you outlined GCI in Panama.
Speaker Change: And then finally I would like to thank you for the LP Little a test that Youll make management Dykas give.
Speaker Change: Given it was among this brought along on that started on the staffing side.
Speaker Change: Thank you.
Speaker Change: Well, that's great to hear Richard I'm glad I'm glad we could help on cosmetics.
Speaker Change: We had 25% growth this year, saying that shows a robust growth profile of the brand.
Speaker Change: In terms of the competitor entries when you look at our formulary position. It does we expect we've had to give the appropriate level of adjustments on our rebates, but we've maintained very good formulary position, we see very good performance in Asian markets, such as China as well as continued good performance in <unk>.
Speaker Change: Europe.
Speaker Change: In Hs, specifically, we think our profile of having a very good flare resolution, where we showed very compelling data on flare on pain.
Speaker Change: I think on it's on some of these I think this really gives us a.
Speaker Change: Very compelling data set and given the long history of safety with Centex, We think a very competitive profile to hopefully maintain that 60% plus <unk> extra that we have we believe in Hs <unk> could be over $1 billion medicine globally now for GCN TMR. Our current estimates of 500 million plus for each one of.
Speaker Change: I think the question of course, we'll have to see I think originally for Hs. We thought this would be 500 to 750 million.
Speaker Change: And we delivered that almost in the first year. So I think we're learning as we go as we get into these new indications and as we have a better sense from launching of course positive data and then launching we feel of course update overtime.
Speaker Change: Thank you.
Speaker Change: And then I think are there more questions operator, we have one more.
Speaker Change: And your next question comes from Sean <unk> from Bernstein. Please go ahead.
Sean Bernstein: Good afternoon again, and thank you for taking my follow up question. This time not on.
Speaker Change: Guidance, but on the pipeline.
Speaker Change: For our U verse.
Speaker Change: As Bill said is now expected in 2026 and it was supposed to be the big phase III readout now on <unk>.
Speaker Change: List of products that will readout each year.
Speaker Change: The phase III piece could you share with us.
Speaker Change: He's on which are the more.
Speaker Change: Most meaningful one.
Speaker Change: Yes, absolutely for US I think there's a couple of things I'd say first.
Speaker Change: <unk> is a key readout I think we've already we've already highlighted that both sjogren in second line ATP. Both of these will be I think really important for the profile of an opportunity and I know, Matt, but also hopefully give a read through what we might be able to do in lupus and lupus nephritis.
Speaker Change: Frontline ICP amongst others in.
Speaker Change: Additionally, we're going to have the readout of <unk> in hormone sensitive prostate cancer, which will further create a patient population that as largest division sorry, PSM before population.
Speaker Change: And I think that would be another leg to build flu victim out to that guidance that we've given a $6 billion plus overtime. In addition, youre going to have I think importantly, the Remy Bruton nib food allergy phase to be read out, which will then enable us to move rapidly for the next third.
Speaker Change: Third indication, we hope Remy Brudenell top of CSU, and Cindy I would say for Remy Bruton Nib, we expect to file soon and then we do currently intend to use a priority review voucher and we do believe that Remy brewed nib in CSU is going to be bigger than the markets expect and I think the <unk>.
Speaker Change: Opportunity here in the U S and around the world to have an oral medicine that can address such as symptomatic disease within two weeks of therapy. It's something we're quite excited about so we're very much focused on that launch as well and then of course on slide 33, you see.
Long list of.
Speaker Change: Of other things, but I think those would be the big ones.
Speaker Change: That I would highlight that would really move the needle for this year.
Speaker Change: Thank you very much.
Speaker Change: And I think that's it so thank you all very much for joining and look forward to seeing you in various settings over the course of the coming quarter and then again at the Q1 earnings call have a great day.
Speaker Change: Thank you. This concludes today's conference call. Thank you for participating you may now disconnect.
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