Q1 2025 AstraZeneca PLC Earnings Call
Good morning to those joining from the U K U S. Good afternoon to those in Central Europe, and good evening to those listening in Asia.
Welcome, ladies and gentlemen to Astrazeneca as Q1 2025 results conference call for investors and analysts.
Before I hand over to Astrazeneca I'd like to read the Safe Harbor statement.
The company intends to utilize the safe Harbor provisions of the United States Private Securities Litigation Reform Act of 1995.
This meeting may contain forward looking statements with respect to the operations and financial performance of Astrazeneca.
Although we believe our expectations are based on reasonable assumptions.
By their very nature forward looking statements involve risks and uncertainties and may be influenced by factors that could cause actual results to differ materially from those expressed or implied by these forward looking statements.
Any forward looking statements made on this call reflect the knowledge and information available at the time of this call.
The company undertakes no obligation to update forward looking statements.
Please also carefully review the forward looking statements disclaimer in the slide deck that accompanies this conference call.
There will be an opportunity to ask questions. After today's presentations. Please use the raise a hand feature to indicate you wish to ask a question at any time during the call.
I must advise you. This presentation is being recorded today.
With that I will now hand, you over to Andy Barnard head of Investor Relations.
A warm welcome to Astrazeneca is first quarter of 2025 presentation conference call and webcast for investors and analysts I'm, Andy <unk> head of Investor Relations and before I hand over to Pascal and other members of our executive team I would like to Cabo some housekeeping items. Firstly all of the materials presented today are available on Astrazeneca as Investor Relations website.
This slide contains our safe Harbor statement, which I'd encourage you to take the time to read we will be making comments on our performance using constant exchange rates or CER core financial numbers and other non-GAAP measures non-GAAP to GAAP reconciliation is contained within the results announcement all numbers quoted are in millions of U S dollars unless otherwise stated.
This slide shows our agenda for the call and following our prepared remarks, we'll open the line for questions as usual, we will try to address as many questions. As we can during the call are there. Please limit the number of questions. You asked about that now there's a fair chance to participate in the Q&A.
Pascal: And with that I'll hand over to Pascal.
Thank you Andy and welcome everybody.
Pascal: We have made a strong start in the first quarter of the year building on the momentum through 2020 for total revenue growth was 10% in the quarter, reflecting increasing demand for our innovative medicines cooperating profit increased by 12% and core EPS increased by 21% reflect.
Pascal: Our continued focus on operating leverage.
Pascal: Although core EPS in the first quarter did benefit from a lower tax rate due to settlements in certain jurisdictions.
Since our 40 our results in February we have secured 13 approvals in key regions across our diverse portfolio a clear illustration of the value of our medicines bring to patients globally.
Pascal: In addition, we continue to see strong delivery from our pipeline and in the past few months announced positive phase III results, including two nm is convinced restaurant enabled by tide and multiple high value indication expansion opportunities across gastric and breast cancers.
Pascal: We're making excellent progress towards our ambition to deliver at least 20 nm is by 2030.
Pascal: With the recent approval of <unk>, formerly known as <unk>, marking the ninth novel medicine approval towards our goal.
Pascal: We continued to benefit from our broad based direct business with our robust growth outlook for each of our therapy areas and across key geographies. We saw strong performances across key regions, despite anticipated headwinds, including Medicare part D redesign in the U S. Importantly, we continued to deliver impressive growth in the emerging markets.
Pascal: Kids with ex China revenues.
Pascal: 17%.
Pascal: Reflecting the benefit of our sustained presents in this market our growth in China was also encouraging up 5% or 9% when adjusting for the decline of Pulmicort sales. These of course is driven by increasing demand for innovative medicines with additional launches in China achieved in the first quarter.
Pascal: We are aiming to deliver sustained growth well beyond 2030 investing in transformative technologies in.
Pascal: In the first quarter, we announced several business development transactions that strengthen our pipeline and our capabilities, which we believe have potential to support our long term growth ambitions.
Pascal: Our proposed acquisition of <unk> biotech brings a potentially best in class in vivo cell therapy platform in house, increasing accessibility of potentially cure killer T cell therapies with applications across oncology and autoimmune diseases.
Pascal: Next we announced our portfolio of novel modalities accelerating the development of multi specific biologics and macrocyclic peptides across a wide range of diseases.
Pascal: We also announced an exclusive license for LTV before with Altair origin to deliver subcutaneous formulations of multiple oncology assets with the aim of making our treatments easier to administer and more convenient for patients.
Pascal: Finally, we announced a recent investment in Beijing, China, where we had established establish our six strategic R&D Center there.
Pascal: Pace of medical and scientific innovation in Beijing is impressive and our new R&D Center will enable us to foster on strengths.
Pascal: Versions within the local ecosystem as well as attract world class talent in China to discover and develop new transformative medicines.
Pascal: To support our growth across the major geographies around the world.
Pascal: We have been building a broad manufacturing network covering the U S Europe and China.
Pascal: Our global presence makes our business highly resilience to original disruptions effectively providing a natural hedge we now have 31 manufacturing sites globally and dual source supply for the vast majority of our medicines.
Pascal: Our supply chain for China, and the U S are largely cigarette gated and we have very limited commercialized finish medicines imported from the U S to China, meaning that our exposure to the current China tariffs on pharmaceuticals is not material in the context of the globe.
Pascal: We have a substantial and growing manufacturing footprint in the U S. We currently have 11 manufacturing sites in the country and the vast majority of our medicines sold in the U S. Ahmed domestically, we doing proper minority of medicines sold in the U S from Europe, However, litigations are already underway.
Pascal: As a result, we believe that if tariffs are implemented in the range. We have seen recently in other industries on medicines importers from Europe to the U S. We would remain within the guidance range, we indicated for 2025 and part due to our ongoing inventory management.
Pascal: Beyond 2025, the impact on a minority of medicines imported from Europe would be time limited as we are shifting manufacturing of this medicine to sites in the U S.
Speaker Change: We will of course provide updates as appropriate and with that I will hand over to a hard now to take us through our financials. Please advance to the next slide.
Speaker Change: Thank you Pascal and good morning, everyone as usual I will start with our reported P&L.
Next slide.
Speaker Change: Total revenue grew by 10% last quarter.
Speaker Change: Product sales grew by 9% with growth seen in all major regions.
Speaker Change: Alliance revenue, mainly consisting of an <unk> and test by a profit shares increased by 42% to $639 million.
Speaker Change: Starting this quarter, we are presenting a new line in our P&L all product revenue. This is the sum of product sales and alliance revenue, which better characterizes the performance of sustainable revenue both from product sold by Astrazeneca and revenue share from partnered products product revenue grew by.
Speaker Change: 10% in the first quarter.
Speaker Change: Next slide.
Speaker Change: Turning to our core P&L, we saw a total revenue gross margin of 84% in the first quarter benefiting from product sales mix and some favorable FX movements.
Speaker Change: Please note that we report gross margin based on total revenue going forward rather than product sales.
Speaker Change: The gross margin percentage based on total revenue reflects net totality of the cost associated with creating it including paying waste to our alliance partners of gross profit shares that are booked in the cost of sales relating to markets, where astrazeneca leads commercialization and booked product sales.
Speaker Change: As previously stated in relation to product sales gross margin, we anticipate that total revenue gross margin will decline around 60 70 basis points in 2025.
Speaker Change: The decline is driven by the part D redesign and dissipated the BBB inclusions in China, Soliris Biosimilar competition and increased profit share relating to partnered products.
Speaker Change: We anticipate a lower gross margin in the second half of the year driven by some of these such as EVP as well as the usual seasonal pattern for certain medicines, such as flu mist.
Speaker Change: Total operating expenses increased by 9% in the first quarter below top line growth of 10%.
Speaker Change: Core R&D cost increased by 16% and represented 23% of total revenue driven.
Speaker Change: Driven by new trial starts and investment in transformative technologies, such as cell therapy.
Speaker Change: We continue to anticipate core R&D cost to be in the low 20 percentage range for the full year.
Speaker Change: Core SG&A costs increased by 4% and as anticipated continue to grow at a slower rate than total revenue.
Speaker Change: The core operating profit margin was 35% supported by favorable cost phasing and a higher gross margin this quarter.
Speaker Change: Similar to prior years, we anticipate a lower margin in the following quarters, primarily relating to the gross margin effect I mentioned above.
Speaker Change: The core tax rate was 16% benefiting from a favorable settlement in the quarter and as anticipated.
Speaker Change: To remain 18% to 22% for the full year.
Speaker Change: Core EPS of $2 49 represents a CER growth rate of 21% next slide.
Speaker Change: Our cash flow continues to improve cash inflows from operating activities increased to $3 7 billion in the quarter.
Speaker Change: We saw capex of approximately $500 million, which will increase in future quarters, and we continue to anticipate capex to increase by around 50% this year versus 2024.
Do you payments of around 800 million included $175 million milestone payable to Daiichi sankyo for in her to destiny breath of six U S approval.
Speaker Change: Our net debt increased by $1 $5 billion to $26 1 billion with the increase driven by the dividend payment of $3 3 billion in the first quarter.
Speaker Change: We remain comfortable with our level of debt and the current net debt to adjusted EBITDA ratio stands at one five times.
Speaker Change: Building on <unk> comments earlier, we are reiterating our full year 2025 guidance anticipating total revenue growth of high single digit percentage and core EPS growth of low double digit percentage at constant exchange rates.
Speaker Change: Based on the March average FX rates, we continue to anticipate low single digit percentage adverse impact on total revenue and have updated our FX guidance for core EPS to low single digit adverse impact previously mid single digit.
Speaker Change: With that please advance to the next slide and I will hand over to David who will take you through the.
David: Performance of our oncology and hematology business.
David: Next slide please.
David: Oncology total revenues grew 13% first quarter to $5 6 billion with strong double digit growth across the U S Europe and emerging markets turning now to quarterly performance for our key medicines I'd like to talk first about our oral onkelinx performance in the U S, which includes two grisso Calpine Slim pars.
David: And true cap.
David: Across these medicines, we saw an increase in the proportion of Medicare part D patients following implementation of the $2000 co pay gap, which led to fewer patients on free goods and increased adherence. These dynamics helped us partially offset the gross to net impact following part D redesign to.
David: <unk> delivered 8% growth in the first quarter, reflecting strong demand across all indications, including accelerating demand for Florida, two in the U S and Europe and strong launch uptake for Lora Unresectable stage III setting strong underlying demand in Europe was partially impacted by pricing pressure in certain major markets and we.
<unk> continued growth over the balance of the year across all indications.
David: <unk> total revenues increased 8% in the first quarter, starting with the U S volumes increased over 20%, reflecting sustained BT K inhibitor leadership, and frontline chronic lymphocytic leukemia, and accelerating launch momentum for echo and mantle cell lymphoma.
David: Following recent Medicare affordability improvements the proportion of Medicare part D. <unk> patients has increased by 10 percentage points over the past year.
David: In Europe <unk> continues to gain market share in an increasingly competitive environment. Looking ahead, we see potential for meaningful new growth opportunities, including the fixed duration amplify regimen, and CLO and continued demand for XO and mcl.
David: <unk> remains the leading PARP inhibitor globally with 5% growth in the first quarter, we anticipate further volume growth globally, which will help offset pricing pressure in Europe, and the potential impact of GBP inclusion in China, which you expect from the middle of the year.
David: True cap delivered $132 million in first quarter revenues and is now approved in all major markets in the U S continued market leadership in the second line biomarker altered population was offset by Destocking of the blister pack following the inventory buildup in the fourth quarter impressively one year post launch true cap is.
David: <unk> nearly 100% market share in the 8-K T. P 10, biomarker altered population with additional opportunity for growth in the <unk> population.
David: Turning now to the rest of our portfolio enthusiasm judo delivered 16, and 13% growth respectively, reflecting continued demand in lung and liver cancers across major markets. We look forward to expanding infancy adoption in bladder and lung cancers. Following recent approvals for Niagara Adriatic and of <unk> in the U S and Europe.
David: And her to total revenues grew 34% in the first quarter, reflecting continued market leadership for Destiny, <unk>, three and four as well as impressive growth in China. Following in our deal enlistment in January we continue to see encouraging launch momentum for destiny abreast of six in the U S and are excited about the <unk>.
David: Recent European approval, which will help move in her two into chemo naive and her two ultra low settings.
David: We're off to an encouraging start with the launch of <unk> in hormone receptor positive <unk> negative breast cancer feedback from breast cancer community reinforces the improved convenience and favorable Gi toxicity profile seen with <unk> and the trophy on breast <unk> one trial.
David: We're excited about the outlook for our oncology portfolio over the balance of the year as we continue to expand the reach of our transformative medicines with that please advance to the next slide and I'll hand over to Susan to cover key R&D highlights from the quarter.
Susan: Thank you Dave over the past few months, we've had several key oncology, Jason Readouts that mark important steps towards achieving our 2013 ambition.
Speaker Change: In February we were very excited to announce the positive high level results accounting questions.
Speaker Change: First next generation all set to have a positive readout in the first line setting in hormone receptor positive metastatic breast cancer with emerging ESO one mutation.
Speaker Change: So I mean, a six demonstrated a highly statistically significant and clinically meaningful improvement in progression free survival and most times a second to question and overall survival remains immature.
Speaker Change: <unk> same treatments and Tom just second progression was also observed.
Speaker Change: This trial also demonstrated the combinability of companies with three CDK, four and six inhibitor and <unk>.
Speaker Change: Note that the combinations are well tolerated.
Speaker Change: <unk> six is the first step to establishing <unk>.
Speaker Change: Does the endocrine backbone of choice across ER positive breast cancer, setting and has the potential to redefine treatment for patients with HR positive metastatic breast cancer and emerging <unk> mutations.
Speaker Change: Last month, we were delighted to share positive high level results for Matterhorn, a key indication expansion opportunity for FMC.
Speaker Change: In Matterhorn, Harry opposite in terms of <unk> in combination with chemotherapy derma.
Speaker Change: Demonstrated a statistically significant and clinically meaningful improvement and event free survival as well as a strong trend in overall survival versus Peri operative chemotherapy alone in patients with Resectable early stage and locally advanced gastric and gastroesophageal junction cancer.
Speaker Change: Lots of hone is the third successful perioptic trough in Pepsi following on from <unk> and Niagara.
Speaker Change: Underscores the value of this approach to treatment.
Speaker Change: This trial represents another blockbuster opportunity expanding our presence in Gi cancers, and unlocking further potential for intimacy.
The practice changing data from Sabrina six and Matterhorn, both feature as Africa trying to raise this year, making this the seventh year in a row Astrazeneca data. That's been included in the plenary session at Heska.
Finally, just over a week ago. We were also excited to share the high level results from the interim analysis suggested maybe best at nine.
Speaker Change: This trial demonstrated that the combination of it hurts your application.
Speaker Change: Resulted in a highly statistically significant and clinically meaningful improvement in progression free survival with <unk> of CAD three drug regimen THP.
Speaker Change: There were no new safety signals for the combination and whilst not mature and Hudson plus parties about.
Speaker Change: <unk> demonstrated an early trends overall survival benefit.
Speaker Change: Definitely the question on is the only ongoing first line trial in her two positive metastatic breast cancer population and which investigational therapy is initiated upfront at the onset of statements and moves ahead to align earlier.
Speaker Change: <unk> positive population, but the opportunity to once again be defined management of this disease.
Speaker Change: And just a follow up and both the combination and monotherapy arms.
Speaker Change: In addition, with the license you said the ultra Mark companion diagnostic co developed with Roche tissue diagnostics has now been granted breakthrough designation by the FDA for use in the <unk> 17 child, which will investigate <unk> in the second line ship to <unk> positive patient population.
Speaker Change: This underscores the potential of this practice changing technology, both for <unk> and the broader astrazeneca portfolio.
Speaker Change: Next slide please.
Speaker Change: We continue to progress our transformative technologies with the potential to disrupt treatment paradigms and deliver sustainable growth beyond 2030.
Speaker Change: At the society of Gynecologic oncology annual meeting this year, we shed phase one two data fits fatigue temperature also known as pacer in endometrial cancer.
Speaker Change: These data demonstrated an encouraging durable updates have response rates of 35% to 38%.
Speaker Change: Median progression free survival of six months.
Speaker Change: And a piece of <unk> positive population alongside a manageable safety profile.
Speaker Change: These data provide us with additional confidence in pizza and supports our decision to start the phase III trial and had to make sure cancer later this year.
Speaker Change: <unk> is one of our fixed astrazeneca ADC, all of which continue to progress our pace in the clinic.
Speaker Change: And with that please advance to the next slide and I'll pass over to vote to cover Biopharmaceuticals performance.
Speaker Change: Thank you so much so Susan please move to the next slide our biopharmaceutical medicines delivered a strong start to 2025 with total revenue, reaching <unk> $6 billion in the first quarter, reflecting a growth of 12% compared to the first quarter of 2024.
Speaker Change: For Sega revenues exceeded $2 billion for the first time, driven by continued demand across chronic kidney disease and heart failure.
Speaker Change: Strong foundation, we have built response Seeger, who will support the potential launch of <unk> fixed dose definitely flows in combinations over the in phase three development.
Speaker Change: Total revenue in the United States was down 19% versus last year.
Speaker Change: When revenues benefited from the launch of an authorized generic and the stocking impact this broke reserve.
Speaker Change: In China, we anticipated for Sega along with <unk> will be included in the PPP program from the middle of the year.
Speaker Change: We're also expecting to see generic competition for Brilinta entered the U S market in the coming months.
Speaker Change: Even so we expect that the growth drivers in our Biopharmaceuticals portfolio. This year, we're clearly outpacing the headwinds.
Speaker Change: Leucoma remains the market leader in an expanding puts us in buying the clauss delivering $153 million in the first quarter and growth of over 35% for the fourth consecutive quarter.
Speaker Change: <unk> delivered another strong quarter up 13% to $2 $1 billion in revenue.
Speaker Change: For Sunrun to aspire soft mellow <unk> no makeup just over half of our R&R total revenue and their combined revenue contribution grew by 40% in the first quarter.
Speaker Change: For some of our <unk> both benefited from the strong positions within the fast growing market for respiratory biologics.
Speaker Change: For similar increase it's all five clubs leadership for severe is Phillip asthma patients supported by the recent launch in Asia in the EPA.
Speaker Change: Despite achieved leading new to brand share in key markets with strong launches across Europe.
Speaker Change: Are all the inhaled medicine, pulmicort, so a drop of 26%.
Speaker Change: The decline was driven by China due predominantly to a milder winter and continued generic competition.
Speaker Change: In Vienna before this revenues more than doubled supported by the recent expansion of manufacturing capacity.
Speaker Change: This year, we're looking forward to several important readouts for biopharmaceutical medicines breastfeeding asthma for <unk> in COPD and soft mellow subcutaneous formulation.
Speaker Change: We have completed regulatory submissions in all major markets for despite in nasal polyps.
Speaker Change: We will also have our first phase three.
Speaker Change: Three readout for <unk>, a new molecular entity with the potential to deliver over $5 billion in peak year revenue.
Speaker Change: I will now hand over to Sharon to share updates across our biopharmaceutical pipeline in the quarter.
Sharon: I would like to take a moment to highlight our progress this quarter within the biopharmaceutical pipeline.
Sharon: At the American College of Cardiology, we were excited to present the positive phase <unk> data for our novel oral small molecule <unk> inhibitor, AED 700, Ido, demonstrating a significant LDL cholesterol reduction on top of standard of care and the potential best in class profile in patients with hypercholesterolemia.
Speaker Change: The data from Christian which we're also simultaneously published in the journal of the American College of Cardiology found ACD and <unk> resulted in a 57% reduction in LDL C versus placebo when dosed once daily on top of standard of care statin.
Speaker Change: Similar efficacy was observed regardless of whether patients received moderate or high intensity statin doses at baseline and <unk> was well tolerated with a similar frequency of adverse events compared to placebo consistent with the phase one data we shared last year.
Speaker Change: Importantly, as an oral small molecule <unk> seven NATO office, the advantage of favorable once daily dosing with no food effect or need for fast and requirements.
Speaker Change: Is convenient profile could enhance patient compliance and has the potential to expand access to this class of medicines beyond its reach today.
Speaker Change: Dyslipidemia remains a substantial public health campaign, placing patients at risk of severe cardiovascular outcomes, including stroke and death and result in approximately $4 4 million deaths per year.
Speaker Change: Based on the data from pursuit, we are progressing <unk> into phase III at pace, and we will simultaneously initiate three pivotal phase III trials in the coming months.
Speaker Change: First we'll investigate ldlc reduction second we will focus on heterozygous familial hypercholesterolemia and the third is a cardiovascular outcomes trial.
Speaker Change: The outcome study will target the prevention of cardiovascular events in patients with a history of atherosclerotic cardiovascular disease and those at high risk of experiencing in CVD event.
Speaker Change: We look forward to updating on future opportunities to use <unk> in combination with statins and other small molecules and our broad CVR and portfolio.
Speaker Change: We believe that <unk> has the potential to be a $5 billion plus asset and an important option for patients who urgently need novel approaches to improve their outcomes.
And with that please go to the next slide and I'll pass over to Mark to cover our rare disease.
Mark: Thank you Sharon can I have the next slide.
Mark: Rare disease delivered total revenues of $2 billion in quarter one.
Mark: Reflecting stable performance year on year.
Mark: While patient numbers continue to grow across medicine and indication year on year. There are several factors impacting revenue growth in the first quarter.
Mark: <unk> grew 25% driven by patient demand across indications, partially offset by competition in generic <unk> mist, and <unk> and folks who small nocturnal hemoglobinuria into a lesser extent from the redesign in neurology indications.
Mark: We expect Soliris revenues.
Mark: To continue to decline due to a successful conversion to <unk>.
Mark: We chose launch in all four shared indications as well as biosimilar pressure in Europe.
Mark: Favorable order timing and sort of temporary market.
Mark: As a reminder.
Mark: Those facilities are now launched in the United States for <unk>.
Mark: Typical it's U S.
Speaker Change: And Mr <unk>.
Mark: Beyond complement.
Mark: <unk> grew 14% driven by continued pressure on demand mobility offset by some impact from part D redesign.
Mark: Considerable go grew 8% driven by patient demand, partially offset by unfavorable order timing in tender markets.
Mark: Despite these headwinds we continue to expect growth across the rare disease portfolio in 2025.
Mark: But at a slower pace than was seen in 2024.
Mark: During the quarter beyond Hong formerly called <unk> was approved in Japan for the treatment of adult with constitute a gene mediated amyloid cardiomyopathy.
Mark: This is an exciting step forward in our pocket.
Mark: <unk> to deliver an industry, leading amyloidosis portfolio.
Mark: Please advance to the next slide.
Mark: During the quarter, we received positive news from a <unk> study.
Mark: <unk> Intercity GMA.
Mark: <unk> is a rare type of Tom boutique my Concho Patty <unk>.
Mark: A severe complications, we metacritic stem cell or bone marrow transplants and is associated with significant morbidity and mortality.
Mark: In the phase III study in pediatric patients.
Mark: <unk> has demonstrated improvements in the individual components of Cumulus bonds, such as blood Lids LDH.
Mark: Donnelley protein creatinine ratio as well as overall survival.
Mark: We await high level results from the placebo controlled phase III trial in adult and adolescent in the second half of the year and look forward to sharing data with regulatory authorities.
Mark: This is the first indication expansion opportunity for <unk> beyond the Solaris level.
Mark: Representing a potential blockbuster opportunity.
Mark: Risk adjusted basis.
Mark: As outlined on our Investor day last year, we continue to build out aware renewal pipeline.
Mark: Expanding into both transform diseases.
Mark: We are initiating the phase III <unk> communities.
Mark: In delayed graft function or <unk>.
Mark: With intermediaries immediate sustained terminal complement inhibition, we believe it is uniquely positioned to help reduce inflammation and renal injury.
Mark: Ultimately extending kidney transplant organ longevity.
Mark: In the quarter, we also announced a phase III clinical trial spending enabled Paul died in Clinique, <unk> patients, which met the composite endpoint showing a statistically significant normalization of serum calcium was she must generously reducing dependence.
Mark: On <unk> and vitamin D supplements.
Mark: We have made changes to the trial protocol to allow put patient to receive a higher dose based on patient response and additional efficacy analysis will be measured at 52 weeks.
Mark: This will help to further characterize enable apologize risk benefit profile.
Mark: 2025 is a catalyst rich year for our rare disease portfolio with four phase III trials due to read out.
Mark: All of which.
Pascal: NME opportunities and with that please advance to the next slide and I will hand back to Pascal.
Mark: Mark next slide please.
Pascal: We've made a strong start to the year with several important readouts.
Pascal: Already in hand, but this is only the beginning as you can see on this slide the number of high value upcoming catalysts. We have through the end of 2025 is quite remarkable and together they represent over $10 billion in potential peak risk adjusters.
Pascal: Potential risk adjusted <unk> revenue sorry.
Pascal: Next slide please.
Pascal: In closing already this year, we are tracking well towards our 2030 ambition. We expect continued growth from all of our therapy areas over the balance of the year and across key geographies importantly, global demand for our medicines is expected to offset the known headwinds as.
Pascal: As evident from our results in this in prior quarters, we will remain focused on delivering operating leverage while continuing to invest in our pipeline and in transformative technologies to support our goals for 2013 and beyond.
Pascal: And lastly, we are on track to deliver at least 20, new medicines by 2030 with nine delivered already an accelerating pace of newer cohorts as anticipated across our portfolio.
Pascal: Please advance to the next slide and we will move to the Q&A.
Pascal: Andy mentioned at the start of the core please limit the number of questions. You asked rollout of this a fair chance to participate.
Pascal: Online players used a rate rise and functional zoom with that let's move to the first question, sorry, Tycho pillar Morgan Stanley's site over to you.
Speaker Change: Hi, Thanks for taking my questions. It's the ratio at Morgan Stanley.
Speaker Change: Lastly, how should we think about the impact of the Medicare part D redesign in the U S. As we move through the year.
Speaker Change: It mostly Q1 weighted or would you expect that the impact from here and if you could help frame or quantify the overall impact to the full year and comment on any underlying outlook for 'twenty five.
Speaker Change: The quality of that but it was it would be useful. Thank you and then just a quick one on events.
Speaker Change: Perhaps you could talk about the confidence around the key ucs biomarker and if there are any examples about Iraq biomarker, alright, just that just sorry biomarker translating to the prospective sachet and just talk about the rationale for using an ANZ as the backbone.
Speaker Change: Does that increase the risk of the trial. Thank you.
Speaker Change: Thanks, Hi, with IBEW could take the first question is on the second one.
Speaker Change: Absolutely thanks for the question.
Speaker Change: In terms of your specific question I would think of part D. As a rebase ing that happens at the beginning of this year and then all volume growth that we're able to have from here.
Speaker Change: Is going to be against that Rebased number and the reason for that is that.
Speaker Change: Catastrophic is triggered on the very first fill within oral oncology products. So it will not grow from here. It's a rebased number from here obviously it grows as our volumes grow within part D and but I think to put this into some context and maybe I'll just talk specifically about <unk> because I think it's a good example.
Speaker Change: In the U S. We saw 20% increase in volumes from our ongoing launches of Florida to Dora, Laura all going really really well.
Speaker Change: Together with reduced free good utilization and some price increases that offset the gross to net impact from part D. Redesign. So we saw revenue growth of 9% in the U S volume growth of 20% and I think that importantly, the new patient start in Trs data show that we're also really managing.
Speaker Change: Competition, while with Florida, and Florida, two and we expect continued revenue growth throughout 2025 within this so I think full year outlook on our oral <unk> <unk>.
Speaker Change: It remains a strong we've got good growth drivers that we're able to operate against and as long as we continue to navigate against those key performance indicators as well I'm confident that we will grow from this re basing period, thanks, Dave and maybe just to add sorry does that.
Speaker Change: As I've said at 20% volume growth on the <unk>. So we have more than 20% of our Ingalls Calico arms and the important piece is that this year. We have this of course one off.
Speaker Change: There are price resetting if you want but the volume growth further supported by new indications for both <unk>. So we haven't really support where it all goes into 26 and beyond so I think for those products. We can have a fairly optimistic outlook in the U S. But also beyond the U S. So then.
Speaker Change: Do you want to take the second question, Yes, sure. Thank you and so just as a reminder, <unk> and <unk>.
Speaker Change: We have taken the learnings that we have some champion long ago, one of the major changes to our fans.
Speaker Change: We should include focusing on the clinically meaningful benefit that we saw had CLO one in the non squamous.
Speaker Change: Patient population and allowed us to have it to that and then.
Speaker Change: What we also have done.
Speaker Change: Isn't that the case, yes, a biomarker so in terms of your question about that the confidence that we have in Q S is based on our understanding of the mechanism.
Speaker Change: We have with <unk>.
Speaker Change: That's your way, which is dependent not just on the.
Speaker Change: Surface expression of cheap, but the amount that gets internalized and that's embedded into the analog.
Speaker Change: And Omar Tcs closets.
Speaker Change: Positivity.
Speaker Change: I also have said that the data that we have seen from the champion lung alone we have seen similar trends in other data points out that we have.
Speaker Change: An update on the European loan Oh, two dataset will be presented at <unk>, which will include an analysis of the.
Speaker Change: Key CF data.
Speaker Change: And of course, that's important because it's.
In Turkey.
Speaker Change: It's too it's a combination also of enthusiasm.
Speaker Change: With an I O agent.
Speaker Change: With the.
Speaker Change: The combination with platinum.
Speaker Change: Thank you.
Speaker Change: Confidence is built on seeing the.
Speaker Change: Similar effects in multiple data sets and embedded.
Speaker Change: The mechanism that we understand why definitely is active and differentiate it and in terms of in terms of <unk>.
Speaker Change: I think the.
Speaker Change: The number of positive in terms of the trials in a number of different settings.
Speaker Change: Further proof of.
Speaker Change: The relevance of that mechanism of action and again, we have data.
Speaker Change: I'll go for him.
Speaker Change: Two which are very consistent across different.
Speaker Change: Checkpoints inhibitors.
Speaker Change: So.
Speaker Change: We remain confident in the combinability.
Speaker Change: That's really with infinity and the application of that into the important.
Speaker Change: Patient population in first line non small cell lung cancer.
James Gordon: So then the next question is from James Gordon at Jpmorgan <unk>.
James Gordon: Hello, James Gordon Jpmorgan, Thanks for taking the questions.
James Gordon: First question was on the old pieces canine. So you had strong phase II data and you've announced the phase III program today, and it's like the slide billions of T cells.
James Gordon: The <unk> franchise will be just can uptake has been slower than originally anticipated. So can you talk about how you are now thinking in terms of how much <unk> will expand the market.
James Gordon: Sure do you think your product would have it the all opportunity to get to your 5 billion plus.
James Gordon: What are you thinking there.
James Gordon: And when this could potentially launch you said about the three programs would be but when could you have the pivotal data.
Speaker Change: The first question please.
Speaker Change: Second question U S manufacturing. So you source the majority of the U S product in the U S.
Speaker Change: Are you considering any incremental U S manufacturing investments and could that be accommodated within the existing set of $3 billion of capex for the year, what might you need to step up what could it be about reallocation.
Speaker Change: And then if I could just wanted a clarification on an IRA and part D redesign.
Speaker Change: Especially I assume you already had the full pricing mix hit in Q1, but we could see further volume expansion due to greater affordability through the year. So you could actually see revenues accelerating some of these impacted products through the year or is it more the absolute Q1 performance is the new run rate. So you've got the pricing mix it already and you've had the body authority.
Speaker Change: Things to things accelerate further through the year or this is just the new normal already in Q1.
Speaker Change: So thats not two or three questions. Thank you. So the first one is all I guess are all persistent will do you want to take this one that has no you can think of as they come and Dave back to you for the Sutherland, Yes first of all James we need to realize that 70% of the patient population eligible for cholesterol lowering drugs.
Speaker Change: Our goal so far.
Speaker Change: Normally belief.
Speaker Change: It looks like an oral PCR screen name.
Speaker Change: We will substantially unlocked opportunity in order to serve a very large population of course the world.
Speaker Change: And part is that we all know that the injectables, we're facing quite a bit of an issue from an exit perspective in Europe.
Speaker Change: And probably will be priced at a lower level.
Speaker Change: Also in the emerging markets, where we have a very strong footprint I think the or appreciate escrow mangrove fulfill.
Speaker Change: A huge unmet medical needs.
Speaker Change: Last but not least I think the uniqueness of our piece of the screen.
Speaker Change: True small molecule and I think sharron articulated very well. So we're also looking for combinations of our all appreciate scrutinize for example, with our own Crestor or is it tomorrow and that makes I think the proposition.
Speaker Change: Potentially very big one.
Speaker Change: So James in terms of your question on Capex and tariff related and what incremental investments are there may be required.
Speaker Change: So two different things one is as it relates to the minority of the products that we do import from Europe into the U S. We're already starting to take action as it relates to tech transfers and building some of the capacity there, but also note that we do have.
Speaker Change: Always a dual source supply and so forth and also capacity.
Speaker Change: Within our existing facilities, so the incremental investment required for that to happen will will be manageable.
Speaker Change: In terms of the overall capex.
Speaker Change: So last year as you know, we also announced a $3 $5 billion Capex and investments in the U S.
Speaker Change: We've said this year that our capex would be 50%.
Speaker Change: Than last year, but going forward, we need to look at how the portfolio develop so for example.
Speaker Change: If the oral <unk> one is successful in phase two as the Pcs canine progresses as <unk> progressed as baxter's that reads out.
Speaker Change: We will then start to plan for success for these molecules and will build own.
Speaker Change: And managed supply accordingly.
David James: David James on your clarification question. So let me break down into the components. The first part of that.
David James: But as we move from a copay cap of 73 to.
David James: 2000, and we saw an increase in the number of patients or a reduced number of patients on free drug program an increase in the number of patients that came off a free drug and into the commercial program. I think that is a onetime effect that you won't see the volume grow over the course of the year.
David James: However, the reduced abandonment vandeman rate I do think grows over the year and very much the revenue growth and the volume growth that we're seeing from Florida to Dora Laura on to Grisso is growth that will continue to see moving forward from this new rebased level that we're at in terms of where the part D.
David James: D.
David James: Impact came from reform I would also note that there is one other dimension on California, and we've spoken about this or I spoke about it last quarter. There are some contracting decisions that we took to secure.
David James: Preferred formulary access those are one time impacts in terms of gross to net that we probably youll see in the quarter and we will grow volume against that as we pull through those contracts and get opportunity to really make sure that that preferred access is translating into continued leadership in cielo.
David James: Oh.
David James: Jim just maybe if I can come back very very briefly to the first question on or if this is kind of I think it's important to keep in mind, you have 24 million people patients ZIP code in the U S who have cardiovascular disease.
David James: 70% of them on our target to have a cortisol level above 70 so.
David James: It's a huge number of people who have established cardiovascular disease another target.
David James: And then I am not even speaking about the population that has elevated cortisol above 100 in the general population not treated so far.
David James: Potential for an oral agent that is priced at the right level is already explained.
David James: Is really very very large.
David James: If our studies deliver of costs that we have to have good results, but we have good reasons to believe.
David James: The product will deliver the opportunity to help patients and go the product is quite enormous in the U S. But also beyond that remember.
David James: Injectable pieces canine great products, but in Europe. They are very limited in terms of access because of cost mostly so again, if we bring a product that.
David James: As more affordable the potential there is quite enormous.
Goldman Sachs: Shall we move to a 100 Ghansham Goldman Sachs Hi, John over to you.
David James: Yeah.
Speaker Change: Hi, sorry, hopefully you can hear me now sorry, I forgot to Amit.
Speaker Change: Thanks for taking my questions. Firstly on <unk> could you just talk to the potential filings trustee that do you think you'll file the combination on before the monotherapy data are available.
Speaker Change: And then secondly, just on a follow up I should comment that Susan made on Oscar data.
Speaker Change: Just to clarify will go up the <unk> biomarker analysis of OS from trough in longer walnuts available Oscar Thank you.
Speaker Change: Thanks, Jim for you or Susan Okay, and so just for the second one just to clarify.
Speaker Change: What I was talking about we are going to present within they took in lung.
Speaker Change: Dataset.
Speaker Change: By market I think.
Speaker Change: <unk> by market within that study, which I think will be helpful. In addition to the data that we have from champion lung colon.
Speaker Change: And in terms of.
Speaker Change: Just can you just oh nine.
Obviously, we are in discussions with.
Speaker Change: Regulatory authorities as we said.
Speaker Change: I think the data show.
Speaker Change: Our highly.
Speaker Change: Kind of meaningful.
Speaker Change: And I think that will.
Speaker Change: Influence.
Speaker Change: But those discussions are ongoing.
Speaker Change: And we also.
Speaker Change: I would just say opt.
Speaker Change: Optimistic in terms of the potential presentation of Destiny best in nine days.
Speaker Change: Yeah.
Speaker Change: Thank you Suzanne such adjourn Banc of America over to Sachin.
Speaker Change: Two questions. So firstly Pascal features high level on U S pricing any high level perspectives on the Trump exec.
Speaker Change: The executive order how are you thinking about U S pricing has been a lot from yourself and others in the media is wonder if you could just touch on that and then secondly, I guess this is Dave but Serena. Thanks, Congrats on the plenary I Wonder if you could just free of prices and how youre thinking about the commercial opportunity benefits and a $5 billion you framed the molecule as a whole obviously, assuming the majority of screen a full but if you could just comment.
Speaker Change: How are you thinking about three to six size and factors that we should be thinking around adoption in terms of testing duration of therapy et cetera. Thanks a lot.
Speaker Change: So maybe let me quickly comment on the first question such U S pricing of course.
Speaker Change: No.
Speaker Change: Lots of potential outcomes here, but.
Speaker Change: It's not very easy to comment because nobody really knows but it is clear that this is an issue that will be.
Speaker Change: On the radar screen of many people.
Speaker Change: Alrighty I think is that.
Speaker Change: There has to be a rebalancing in fact.
Speaker Change: The U S has been funding innovation for our industry for a long time.
Speaker Change: And we believe that.
Speaker Change: Europe has to invest a greater share of their heska expenses and that share has been declining steadily over the last number of years down two 7% of healthcare budget being allocated to innovative medicines in the U K, what can you do with 7% of yard scale cost allocated to innovative medicines of course.
Speaker Change: Not much so.
Speaker Change: So the.
Speaker Change: Investment and innovation in Pharmaceuticals, and Yalof has to go up and what that means is for some products higher prices that are.
Speaker Change: Cross sell to a higher certainly than they are today, maybe closer to the U S. But importantly, also fast all access and better access for patients.
Speaker Change: So.
Speaker Change: At the end of the day, what happens in the U S. We'll have to see of course.
Speaker Change: Ongoing discussions as you can imagine, but I really think the key pieces that Johan please.
Speaker Change: Rich our countries in Europe have to contribute more to pharmaceutical pharmaceutical innovation, just like they have to contribute more to their own defense.
Speaker Change: Relocation of GDP, which actually in terms of pharmaceutical innovation would be relatively modest.
Speaker Change: But that's.
Speaker Change: That would enable a lot of.
Speaker Change: Accelerated access in southern your pricing level debt with.
Speaker Change: With enable to rebalance.
Speaker Change: In the funding of that innovation between the U S and Europe and second question that you want to cover that.
Speaker Change: Xiaomi broadly and really.
Speaker Change: Talking about the <unk> opportunity. So I mean, as we think about cameras that strength such an obviously the program comprises early adjuvant breast cancer trials as well as metastatic studies I think that.
Speaker Change: If we're able to unlock an opportunity within the adjuvant setting and within serene afford to the point that you raise that really is going to do the lion's share of the work to get us to that $5 billion, plus but Serena <unk> is such an important study and the reason it's important is that theres 85000 patients with frontline drug treated arm on risk.
Speaker Change: After positive.
Speaker Change: Her two negative metastatic breast cancer and the <unk> seven and two thirds of those patients are considered endocrine therapy sensitive and they are treated today with the CDK four six and an <unk> in the frontline setting.
I know that 30% of those so this is a pretty significant number develop the ESR one mutation during the course of the frontline treatment and that ESR. One mutation is something that can be today.
Speaker Change: <unk> with Ngls testing and Ngls at least in the United States is fairly common among this population. So there is going to be work that we're going to need to do to incorporate this testing as part of the regular blood work, that's being done but the access to the test and the test itself is something that is already incorporated into the workflow and into the practice.
Speaker Change: And it allows for US to in addition to moving earlier than the other next generation surged, which gives us an opportunity for early experiences I think the likelihood that those experience are going to be good ones.
Speaker Change: <unk> is high and I also think that the fact that we can use this on a backbone of multiple CDK. Four sixes is also really important. So those are the elements of <unk> that I think are most noteworthy.
Speaker Change: And can you maybe to add back again to your earlier question as such and.
Speaker Change: I want to make sure that everybody understands.
Speaker Change: The price difference between the U S and Europe is not true for every product I mean, there are lots of products.
Speaker Change: That have a similar net prices I mean, Europe, Kevin you have a single price in the U S. You have commercial Medicare.
Speaker Change: The Medicaid.
Speaker Change: And then in commercial and part D. We provide a large and a larger amount of rebates and those railroads can be very very large for some products. So if you look at things on a net basis net of rebates and cooperating Medicaid Vod Vod and sort of calculated the net price for the United States with compared to the price in Europe.
Speaker Change: While many medicines the difference is actually very small and sometimes.
Speaker Change: Zero actually no difference, we'll have very little so really we're talking about a few products.
Speaker Change: And as I said Europe has to fund this innovation in a better way.
Speaker Change: Steve Scala at Cowen about Houston.
Speaker Change: Thank you so much I have two questions Pascal to sum up your tariff commentary in the prepared remarks is it fair to say that under all contemplate scenarios and in light of Astrazeneca actions over the next two to three years.
Speaker Change: Tariffs are not material at the group level is that is that a fair conclusion and then the second question is for Dave on <unk>. The press release stated that safety was consistent with the known profile of her too.
Speaker Change: But it could be argued that in first line setting it needs to be better, especially regarding IL D. So what should be our expectations for the full dataset and will <unk> contribute to sales in 2025. Thank you.
Steve Scala: Thanks, Steve So quick first question.
Speaker Change: No.
Speaker Change: I'm not.
Speaker Change: I am not able to forecast every potential scenario in the world. We live in we have to assume any scenarios possibility of other scenarios, we can't even imagine today. So it's hard to answer your question, but what I can say is that.
Yes, I mean, there isn't a period of time, which maybe two years.
Speaker Change: Any impact we have would actually be managed.
Speaker Change: As I said first of all the impact is not is limited but importantly.
Speaker Change: The impact we have is time limited because we are really deploying manufacturing instead of.
Speaker Change: Globalizing the manufacturing of one product in the U S for the World and you all for the World we can actually.
Speaker Change: Sure.
Speaker Change: And sort of manufacturer one product for the U S and the U S and the rest in Europe, and vice versa. So we have because of our cup.
Speaker Change: Network, where the ability to shift manufacturing wrong.
Speaker Change: Yes.
Speaker Change: Relatively short period of time and basically this issues could be managed and.
Speaker Change: Southern is not material long term as we based on what we can see today.
Steve Scala: Steve on your DVR nine question.
Speaker Change: I mean, you'll have to go to the presentation to get into the details on the specific data within it but I do think that what I would point to is that when we speak to the results being statistically significant and clinically meaningful that is in overall.
Speaker Change: <unk> of the benefit risk and I think that the trend in overall survival that we commented two is also something that underscores the entire benefit risk.
Speaker Change: Within that population is a very important study 25000, <unk> seven frontline drug treated her two positive patients.
Speaker Change: This is a study in a broad population.
Speaker Change: And on your question on <unk>.
Speaker Change: Use in 2025.
Speaker Change: Obviously, we won't promote to anything before it's approved we certainly do know that guidelines and presentations can result in end markets, particularly the U S where it's allowed for.
Speaker Change: Spontaneous use but we'll have to see what the reaction is to the day after it's presented.
Speaker Change: Thanks, so much our sag plummet on those bank kind of a chest over to you.
Speaker Change: And so much of questions. Please firstly for Pascal, Ontario.
Speaker Change: Drug pricing, perhaps a different angle.
Speaker Change: Over the last couple of years, a handful of members, including Astrazeneca left different industry associations like former in recent weeks, we've seen a number of individual format executive share that perspective on the best path forward. My question goes to what extent do you anticipate the industry come together more in the near future in order to perhaps better than that.
Speaker Change: Its message to different stakeholders and up to <unk> My favorite book for about 40 in the industry and then secondly for Rob.
Speaker Change: It is now almost a year since the company shared it's $8 billion revenue target for 'twenty and ambition, sometimes described as conservative within the investment community from your perspective, any particular areas that you'd like to point us to what companies and tone of modeling still deviates materially from company compiled consensus. Thanks, so much.
Speaker Change: But it's interesting to hear the $80 billion Conservative first time I hear it does describe it as conservative much us, but it's still.
Speaker Change: It's still nice to hear that you believe in our portfolio. So I'll leave that answer.
Speaker Change: Yes, I think the industry is coming together and basically we have.
Speaker Change: We have a couple of issues to resolve as an industry. One is salaries and of course our ongoing.
Speaker Change: <unk> set our industry discussions, but the other pieces.
Speaker Change: I think what is really important and long term, it's probably less rather than the near term, but it is mid to long term relevant is addressing this.
Speaker Change: Imbalance that exists between Europe, and the U S as it relates to funding.
Speaker Change: Two medicines again as I said.
Speaker Change: It's a question for you obviously a question of <unk>.
Speaker Change: Sovereignty and sovereignty.
Speaker Change: <unk> has sovereignty for their European citizens.
Speaker Change: It's not only a question of Fries people just think it's a question of price. Sometimes it's also a question of delay and in many countries in Europe patients have to wait two years three years to get access.
Speaker Change: Or it's a very restrictive so I think I think with a reasonably modest increase of the.
Speaker Change: <unk> allocated to.
Speaker Change: Innovative medicines.
Speaker Change: None of these things could be addressing disappear and I think thats an issue of the industry is addressing productivity.
Speaker Change: I believe I hope that we can continue working together to address those two issues.
Speaker Change: So yes. Thank you so much for your confidence in our $80 billion number.
Speaker Change: We are working hard to achieve that.
Speaker Change: As we've mentioned, but this time than when we announced our full year results at 2025 will really be a very important dear and.
Speaker Change: This time next year, we should have a very good sense of.
Speaker Change: Where we stand on that trajectory to that $80 billion ambition.
Speaker Change: The $80 billion is a risk adjusted number so this year, we will be.
Speaker Change: Reading out several studies a multiple in the rare disease portfolio several in the Biopharma portfolio.
Speaker Change: A portion of oncology.
Speaker Change: As well as the oral DLP product, which is in phase two so.
Speaker Change: Again, not everything will work, but on a risk adjusted basis by this time next year, we will have a very good idea in confidence as to where we are on that $80 billion ambition to your question on where we see variances versus our own plan.
Speaker Change: I think there are multiple products.
Speaker Change: Particularly in the Biopharma portfolio I think are some of the respiratory products are some of the.
Speaker Change: CVR M product the oral <unk> nine I think now people are starting to appreciate that opportunity.
Speaker Change: The MLR.
Speaker Change: MLR doses. So I think there are several products in the biopharma in the rare disease portfolio as well as.
Speaker Change: In the oncology portfolio I think we're not really getting any credit for the investments, we're making in our own ADC pipeline that Susan highlighted.
Speaker Change: As well as other investments, we're making in cell therapy. So yes.
Speaker Change: There are several areas of variances, but but those are the major ones.
Speaker Change: Thank you thanks, Joe mature western UBS material over to you.
Speaker Change: Yeah.
Pascal: Thank you Pascal two questions. Please.
Speaker Change: First for Susan on vans.
Speaker Change: Based on our feedback a lot of investors are nervous and would like to basically see this one out of the way. So they can concentrate on the rest of the rich capitalist path.
Speaker Change: That you and Pascal laid out now clearly you might disagree.
Speaker Change: But I wonder if there's any color you can give us on how events are tracking and when we might see the data within the second half of the year.
Speaker Change: And then the second one for our Ratner. Please at the 2024 annual report calls out 561 million.
Speaker Change: Benefits of intellectual property incentive regimes in your tax paid.
Speaker Change: President Trump has called out low U S tax payment by pharma is a frustration alongside manufacturing locations.
Speaker Change: Pascal obviously has made the reassuring comments around manufacturing in Paris, but have you had any interaction with U S. U S authorities on how you use IP licenses to take profit outside the U S.
Speaker Change: So <unk>.
Speaker Change: <unk> US is on you could cover this and of course on the second one I don't want is still there.
Speaker Change: Sunday, but I think it's important maybe to signal that.
Speaker Change: You know about.
Speaker Change: Distribution of taxes around the world in the U S. We have a fair amount of that proportion of taxes paid in the U S. So so I don't think we are in a position where people could say we are optimizing talks to the extent, we don't pay our fair share of taxes in the U S. We do pay a fair share of taxes in the U S.
Speaker Change: Sure no it doesn't want to give the details, but I can tell you we pay a fair share of Texas in the U S.
Speaker Change: Of Enzo for Susan and the second question of armour Yeah.
Speaker Change: Thank you.
Speaker Change: So in terms of just.
Speaker Change: Just a couple of things.
Speaker Change: Yes. So accrued are ahead of time, which shows the enthusiasm that the investigators population.
Speaker Change: Cindy.
Speaker Change: We guide by by.
Speaker Change: By half.
Speaker Change: We do expect the results in the second half of this year.
Speaker Change: Yes.
Speaker Change: The reason why that's going to be delayed beyond the end of the year.
Speaker Change: On your second question.
Speaker Change: And we do pay our fair share of taxes.
Speaker Change: And in proportion to our revenues in the U S.
Speaker Change: We do take advantage, obviously of transfer prices, but I think the numbers you were mentioning that are mentioned in the annual report relate much more too.
Speaker Change: Things like patent box isn't where governments do provide incentives for for research and so forth and R&D funding. So.
Speaker Change: We're always trying to optimize how we manage and plan our taxes globally.
Speaker Change: So that's all the detail we can provide at this time.
Speaker Change: Mature.
Speaker Change: I don't think I would disagree with you that of enzyme it's an important event.
Speaker Change: For us this year.
Speaker Change: Many of our events.
Speaker Change: <unk> is another major events, we have major quad.
Limbaugh: Limbaugh major events.
Yeah in the pipeline, we've already there is <unk> <unk> of cost.
Speaker Change: So it's an important event I don't disagree.
Speaker Change: Sure.
Speaker Change: <unk>.
Speaker Change: For that Readouts for sure, but we have many others. So next.
Speaker Change: <unk> from Justin Smith at Bernstein.
Justin Smith: Thanks, very much just a quick one for Mark Altamira, just wondered if you could just provide a bit more color with regards to increased competition is that potentially do to price just asking because obviously one of your competitors, particularly in the Mg space is emphasizing more innovation should be driving market expansion.
Many thanks.
Speaker Change: So the.
Speaker Change: So first of all thank you for the question.
Speaker Change: The competition that we have is.
Speaker Change: Obviously from <unk> is mostly from novel medicines.
Speaker Change: The category of <unk> as an example has grown dramatically over the last three or four years.
Speaker Change: <unk> part of the market is growing very.
Speaker Change: Very strongly every year.
Speaker Change: As a key position in this market, but obviously.
Speaker Change: Although our mechanisms.
Speaker Change: Flexion for people switching from the.
Speaker Change: Steroids or immuno suppressant as a first line treatment.
Speaker Change: <unk> is also competing in that segment, but it's not the only mechanism.
Speaker Change: So we have it is most of your competition.
Speaker Change: Novel Medicine, rather than Biosimilars, Biosimilars, obviously competes against Soliris, but as we have now converted.
Speaker Change: Most mostly of Soliris to communities in the four indications this.
Speaker Change: The competition in the future will be coming from the novel medicines.
Speaker Change: Thank you Marc Seamus Fernandez of Guggenheim Alturas Seamus.
Speaker Change: Alright, thanks for the question so.
Speaker Change: Two quick questions. So Pascal you commented on the pricing dynamics and concerns that have been raised.
Speaker Change: But you haven't commented on the opportunity for the.
Speaker Change: HHS Secretary to work with Congress to align the incentives for small molecules with large molecules just wondering your thoughts on that as well as kind of a backward looking.
Speaker Change: A dynamic with regard to already negotiated.
Speaker Change: Molecules in the context, including <unk> and then separately.
Speaker Change: Just wanted to ask a little bit.
Speaker Change: For directional predictions that you believe DBO nine may have as it relates to potential success.
Speaker Change: And her too in the adjuvant setting thanks, so much.
Speaker Change: Thanks for CMS, yes.
Speaker Change: The first point, thank you for reminding us of this I mean it is definitely.
Speaker Change: Where I still has to vote on this of course and confirm it but it is definitely something that goes in the right direction.
Speaker Change: For the industry in general and for Us in particular.
Speaker Change: Of course, our existing medicines, but it can sink of come as this trial.
Speaker Change: Which would be very much on medicine, we believe without any benefits from this.
Speaker Change: I think also we can take out of.
Speaker Change: What we could see as potential willingness to address the 340 B a child issues.
Speaker Change: This is something that.
Speaker Change: We as an industry, but Tony we as a company.
Speaker Change: <unk> been pushing back on because.
Speaker Change: We believe that.
Speaker Change: A number of participants of abusing doses have been abusing this 340 <unk>.
Speaker Change: Ah regulation and it was nice to see that.
Speaker Change: None of that has been provided.
Speaker Change: Provided to the Congress that confirms what we have been saying for a long time. So there's a couple of things that actually are going into our direction, you're absolutely right and I think the industry with benefits and we would benefit.
<unk> online.
Speaker Change: Susan you want to cover that yes sure.
Speaker Change: So just as a reminder.
Speaker Change: The <unk> study.
Speaker Change: Taking on the free drug.
Speaker Change: Benjamin.
Speaker Change: I think the fact that we've seen highly statistically significant and clinically meaningful improvement with a combination arms.
Speaker Change: <unk> and her team.
Speaker Change: Speaks to the.
Speaker Change: Sure.
Speaker Change: Two two.
Speaker Change: Just that builds on the data that we have with them.
Speaker Change: DBS Fe Tpa for DBS six.
Speaker Change: If you look at the other child steep 11.
Speaker Change: Sure.
Speaker Change: Patients in the Neo adjuvant setting.
Speaker Change: And again aims to improve on the.
Speaker Change: Standard of care in the Neo adjuvant setting, which.
Speaker Change: Has multiple drugs is that true.
Speaker Change: Five chunks as the current standards of care with us.
Speaker Change: I see that.
Dave: The th pain Regiment, and then Dave.
Dave: <unk> five is in patients who have residual disease after surgery.
Dave: Neo adjuvant.
Dave: And around half of those are considered high risk, which is the node positive patients.
Dave: The subgroup.
Kathryn: Kathryn child.
There is not the end one demonstrated less benefit and given the PPL three days, where we've already had a head to head comparison with that would you believe that.
Kathryn: Is that you can make a difference in both of those sectors. So I hope that gives you context for the potential readouts for <unk> and <unk> all of them.
Speaker Change: Thank you Sir our next our next question is from Simon Baker of Redburn.
Speaker Change: Maam you may be on mute.
Simon Baker: Can you hear me now yes go ahead. Thank you.
Speaker Change: Button.
Speaker Change: Two questions. If I may please firstly, one for Dave and.
Speaker Change: You talked about.
Speaker Change: <unk>.
Speaker Change: Gradual impact home discontinuation rates from part D. Redesign I appreciate it's a bit early to start talking about what the impact is but could you talk about the point from which we start in terms of where we are now in terms of financially motivated discontinuation rates and then secondly, one for Sharon.
Speaker Change: I noticed from the trial appendix that many.
Speaker Change: <unk> falling outside of Amazon <unk> and microwave products that can move from the pipeline.
Speaker Change: As far as I can see that removes neuroscience assets from the Biopharma pipeline, it's not just coincidence that marketing strategic shifting R&D priorities. Thanks, so much.
Dave: Okay Dave.
Simon we.
Dave: Have seen in the past and we haven't given specific percentages on this but we've seen I would say.
Dave: Important minority of the total oral packs that we ship are historically free drug that we ship and so those are things that historically, we've seen as abandonment now whether or not that's been abandoned at the first script or that set of refill because there is.
Dave: Discontinuation that happens down the road, that's much more difficult to parse out, but we've absolutely seen and we've put into place a number of measures as copay capping came down from.
Dave: Uncapped to.
Dave: Last year's 33 to this year's 2000.
Dave: We have absolutely seen a reduction in that free goods utilization I don't have a big expectation of seeing a lot of further improvement in free goods, because it's really come down pretty significantly I think that the best opportunities for us to grow coming from here is <unk>.
Dave: B as always new indications Tigris, so continuing to drive, Florida to Lora, Dora amplify and echo on <unk>, that's our opportunities to really come from this re baselines spot that we're at an hour drive growth from here over the course of the period.
Dave: The multiple quarters that sit in front of us.
Dave: Just to repeat again.
Dave: Two.
Dave: Don't forget Theres some messages.
<unk> is growing by 20% in volume <unk>.
Dave: Lines by more than 20% of the volume so Tigris and.
Dave: This momentum.
Dave: Dave just said in terms of new indications.
Dave: You can imagine that as we weather this.
Dave: But the repricing, which is one of these.
Dave: That will take us into 2697, there is a renewed momentum for this very important medicines.
Shawn: Shawn Thanks.
Speaker Change: For the question Simon.
Speaker Change: In R&D prioritization is always important so as you noticed we have closed on your programs and identified partners for some of them.
Speaker Change: This represents a closure of our neuroscience group at Astrazeneca and importantly, it allows us to focus on our core therapeutic areas and fund our high value programs, you've heard our excitement about things like weight management about dyslipidemia about are very important respiratory portfolio and our growth in immunology into this prioritization helps us to reinvest in it.
Speaker Change: <unk> that we think are important for astrazeneca.
Sean: Thank you Sean.
Speaker Change: Have things that you haven't seen yet because they are in early development and with some speak much about this but things like inhaled biologics the immune portfolio that has been really progressing and it's shaping up nicely. So there's a lot of things we can fund and we cannot be everywhere. So CNS really is.
Sean: <unk> already better managed by all the companies that have a focus on that Jeff.
Speaker Change: Jeff <unk> Jeff.
Sean: Over to you.
Speaker Change: Hi, there.
Speaker Change: Thanks for taking the question.
Speaker Change: On.
Speaker Change: <unk> nine if you could.
Speaker Change: Give us some idea on the timeline of.
Speaker Change: Ben or are we expecting.
Speaker Change: The trials and updates.
Speaker Change: So.
Speaker Change: The development timelines.
Speaker Change: Similarly on fair enough fix about.
Speaker Change: Filing timelines if you have.
Speaker Change: Any clarity on that one.
Speaker Change: Second slightly broader question I appreciate there's a lot of interest on <unk> and <unk>.
Speaker Change: Nervously waiting for the readout.
Speaker Change: We can easily confused.
Speaker Change: The detail for the bigger picture so can.
Speaker Change: Can you.
Speaker Change: And if that your broader.
Speaker Change: Property around capital.
Speaker Change: Where do you think what are the total potential of the product across indications.
Speaker Change: How do you see that the plot.
Speaker Change: Would appreciate that thank you.
Dave: So first question on <unk> six for Susan and the last one is for you Dave I guess.
Dave: So thank you for your interest in Pcs canine you hear our excitement about this molecule and as I mentioned today, we are launching three phase III studies in moving at pace, we expect to have a pivotal study in LDL lowering initiated by the end of this year now we won't comment broadly on the readout timelines for these.
Dave: Pivotal studies, but you heard us tell you that we're moving forward with a sense of urgency that we are running a combined primary and secondary outcome study.
Dave: And we think that we'll be able to launch with our LDL lowering study while moving ahead in parallel with our outcome study that will help facilitate market uptake. So continue to watch this space.
Dave: So.
Jeff: Jeff on the.
Jeff: Bigger picture question on <unk> and I. Appreciate you asking it I think that understandably because of bonds or is the first front.
Jeff: Frontline lung cancer study to read out there is a lot of interest within it but I do think it's important to not look at it just with an isolation.
Jeff: There's multiple opportunities for data as a mono therapy, and particularly as we take a look at sites like <unk> 17 that.
Speaker Change: Now look at prospective definition of a biomarker population and Susan commented on this performed with quite a lot in the past.
Jeff: The work that we've done with the QC us biomarker I think is really.
Speaker Change: Evidenced.
Speaker Change: Leveraging this convergence of science data and technology to be able to try to better and more precisely identify patients who can benefit potentially from from natural way also though in combination and theres multiple combinations that we look at there's combinations with I O. There's also combinations with <unk> and Egfr mutated.
Speaker Change: And we're looking at combinations not just with PD, one PDL, one, but also with our bi specific portfolio. So I think that that's the context within which I'd put data.
Speaker Change: Underway already in the U S in breast cancer.
Speaker Change: I would note that we are seeing that over half of the accounts that have placed their first order for <unk> have also had repeat utilization. So that's a really encouraging sign.
Speaker Change: And it also underscores the high unmet need and willingness to be able to bring a more precise chemotherapy with a profile like natural ways to replace classical chemotherapy in settings, where classical chemotherapy has long been a relied upon and I guess Pascal and the last point, which is.
Speaker Change: Let's now look at it in isolation or as a entire portfolio of <unk>.
Speaker Change: Many readouts that we've got an opportunity also and you've already seen whether it's matterhorn Serena <unk>.
Speaker Change: <unk> that also go alongside that thanks, Tim.
Speaker Change: Besides behind burglary solve it for you.
Speaker Change: Okay.
Speaker Change: Sorry, yes, six as im going with Yodlee.
Speaker Change: So thank you for the question.
Speaker Change: So we're very excited to see the days to come to the <unk> plan.
Speaker Change: And I think.
Speaker Change: Selections in Africa.
Speaker Change: It just reflects.
Speaker Change: Hum.
Speaker Change: The other thing about that.
Speaker Change: The overall benefit risk.
Speaker Change: And in that trial. So obviously as we always stay with me for a readout will be in discussions with regulatory authorities.
Speaker Change: On that specifically because that sounds kind of but what I would say is that when you see compelling data.
Speaker Change: First of all we will work very diligently to get the submission happening.
Speaker Change: Rapidly and then we'll also get in it.
Speaker Change: We've had other examples of when we see compelling data that we get.
Speaker Change: So for.
Speaker Change: Thanks, a lot.
Speaker Change: Let's wait and see how that progresses and if they have to talk about the swing of six data once you see the data at ESMO.
Speaker Change: If I could just take one more opportunity.
Speaker Change: I just want to cycle as well.
Speaker Change: The overall enthusiasm.
Speaker Change: Catherine from investigators about the kind of industrial program, which is substantial the adjuvant studies.
Speaker Change: A really exciting opportunity and I'm very pleased to share.
Speaker Change: Sure that without shame achieved a target sample size and the Cambria one study.
Speaker Change: Recently, which is also ahead of plan so I think.
Speaker Change: It just reflects the enthusiasm that we're thinking about the federal program.
Speaker Change: I'm sure you won't have that Susan Love's going to this trend.
Luis: Luis over to you now.
Luis: Thank you Pascal and I have two questions. Please on the BCG.
Luis: Your perspective on the markets and Astrazeneca has potential.
Luis: Market evolves given recent competitive nature.
Luis: And then on China. Thank you for the update on the press release do you think we can draw a line here on the all the investigations are is there anything else.
Luis: We should have in mind as we go through the year.
Luis: Just a quick comment on your market share is holding up in Q1 in China is that intact.
Luis: And your latest expectations on timing of Hep C. J D V P. Thank you.
Luis: Or do you want to take that.
Luis: So luisa.
Luis: Very excited about our weight management portfolio.
Speaker Change: Last time, Sharon explained in quite a bit of detail.
Speaker Change: Why we are so excited I think we have first of all our broad portfolio.
Speaker Change: I think our oral G O P. One potentially is fit for purpose in order to combine it with other products in our portfolio.
Speaker Change: Clearly as <unk> to the market sizing itself is very very substantial as you as you as you know you saw very well.
Speaker Change: Analysts are forecasting anything between $50 billion and 150 billion.
Speaker Change: And I think our strategy is differentiated and situate US yes, we are looking in what we call the hardcore obesity markets.
Speaker Change: <unk> was a BMI of over 35, the decrease patients with a BMI between 27 million slightly above that are going to benefit substantially from from losing.
Speaker Change: Certain amount of weight and if you combine that with other products in our portfolio, whether it is potentially nor appreciate a screen nine.
Speaker Change: <unk> I think we have a very powerful combination not only in order to reduce weight, but also to move to protection of Oh.
Speaker Change: Different organs now, having said that I think the other opportunities clearly.
Speaker Change: Footprints, who are having in the emerging markets.
Speaker Change: The likelihood that an oral PCI screen name will be priced at a lower level versus the current available injectables is a reasonable assumption and hence we are also aiming for a very large population in the emerging markets. So all in all very exciting of course, the ongoing phase II trials are.
Speaker Change: Are running as we speak both in obesity and diabetes. So we need to wait for that but we are ready to move with speed.
Speaker Change: To start our phase three trials if the data is successful.
Speaker Change: Thank you and.
Speaker Change: Just maybe one additional point is that as let's say the way I have a quick one.
Speaker Change: MC footprint, we sign our mission is always to try and.
Speaker Change: Bringing our medicines to as many people as possible and if you look at the courage to all market. The pieces kind of in market is a good parallel injectable kind of on our great products, but others.
Speaker Change: Their penetration is more limited because of.
Speaker Change: Cost in.
Speaker Change: And injections. So on all agents will enable us to bring this type of medicines to more patients around the world. The other benefit maybe to add is that the lower agencies.
Speaker Change: However, the better option in terms of compliance long term.
Speaker Change: I think the Oh.
Speaker Change: I've always obesity or chronic conditions, you have to take those medicines.
Speaker Change: Long long time, otherwise you will regain weight and we've seen this over.
Speaker Change: Novo again, so knowledge on that you take in combination with you all the medicines is more likely to enable patients to stay on treatment for a long period of time, especially the prices of further growth.
Speaker Change: Yeah. So thanks Louise for the question, let me first start with a comment on the on the update on the investigation as you recognize the announced important updates in our results announcement and put them in what they know customer facing public Security Bureau have really concluded there, especially investigation both there.
Speaker Change: Related to the drug importation navigation allegations.
Speaker Change: Personal.
Speaker Change: Information infringement allegation and these cases are now have now been referred to the prosecute their employee and update that they provided in our result announcement is that they have been informed that there was no illegal gain to the company from the personal information.
Speaker Change: Infringement allegations.
Speaker Change: The second.
Speaker Change: Question about the market share as you saw in our.
Speaker Change: Quarter, one announcement, we saw the strong performance in China strong quarter in China at 5% of the growth in our underlying businesses is basically performing even better because if you adjust for the permit court, which is declining due to the low low infection.
Speaker Change: And in the market decline, our underlying business in China has grown 9% and that is driven primarily by the continuous strong performance of four Seeger and I would argue outstanding loans and <unk> followed by by inclusion in <unk>.
Speaker Change: <unk> and into January and our ability to basically.
Speaker Change: <unk> achieved 800 hospital listings and in the first quarter and it clearly helps a lot.
Speaker Change: Of basin. It makes it a huge unmet need in China in that space.
Speaker Change: On top of that.
Speaker Change: We are seeing continuous improvement of the market share we are still leading in day in day in the respiratory field, both symbicort and breadth.
Speaker Change: So very encouraging.
<unk> market share increased from breast as well as the improvement in the usage of the triple or triple therapy in a given the huge unmet need in China related to the COPD.
Speaker Change: But we do see.
Speaker Change: Huge unmet need things like that.
Speaker Change: When we look at other important growth drivers as Youll notice that he sees an important growth driver in China, and we do see continuous growth of February so given by the new indication as well as.
Speaker Change: Improving improvement in the market share despite a fearless competition and six <unk>.
Speaker Change: Generation Teekay is there from the local companies that are available in the market. So all in all we feel very comfortable and confident in the portfolio team performance in the first quarter and as we always are.
Speaker Change: As you know are they still see about D. C. We feel confident and comfortable with that.
Speaker Change: Opportunity going forward, if I was in China, given the unmet need and given our portfolio and pipeline that technique.
Speaker Change: Thank you for maybe just to add something to this call. We're not tell Lucas is modest but she has done an amazing job and the team is very motivated local area was down not long ago, and it's important because thats really what is going to sustain our growth moving forward.
Speaker Change: The team has gone through a period of.
Speaker Change: Thomas as you can imagine we've all been sort of tornadoes by this event.
Speaker Change: And but people are the people are quickly recovered and they're very much focused on delivering on our goals and everybody is very committed to it.
Speaker Change: And I'll just today.
Peter: We would take the last question Peter overdue BNP Peter over to you.
Speaker Change: Yes, Thanks, plus company, but it will be excellent.
Peter: Two questions just firstly for you we've seen.
Peter: The first produce a delay from FDA this week that wasn't Jude the needs.
Peter: Further clinical and manufacturing data so just in light of all of the personnel changes.
Peter: Don't see any or any disruptions or delays with respect to astra's interaction with the agency and then look I know you'll recall that what we have lined up.
Scott: Sure Scott.
Peter: Our heads about upcoming phase III readout.
Peter: The recent <unk> data from <unk>.
Peter: They are all this is that the right way of thinking about setting the bar or are you hoping to share something more than just wanted to get a sense of your expectations going into that readout. Thank you.
Peter: So can I propose moving Suzanne you cover the first question is on the whole and in Charlotte. If you have anything to out of the a and you can also corner of extra stuff.
Peter: Yes. So obviously, we continue to monitor the situation, but just based on the facts, we haven't seen any delays in the interactions that we've had with the FDA cross sell programs to date just to remind you that <unk> was approved ahead of the <unk> and we have multiple interactions with the FDA on Costco extensive portfolio and all the.
Peter: Those things are happening in the timelines that we would expect and with the.
Peter: Level of interaction that we would expect.
Peter: Okay.
Peter: Yeah.
Peter: To date, we have had.
Peter: <unk>.
Peter: On time conversations with the regulatory authorities and to date, we haven't seen delays that said you know we continue to be very alert to this and continue to move forward with our programs with a sense of urgency.
Peter: To address your question about Baxter stat in light of the Minneapolis data that was revealed earlier this month.
First I think it's very encouraging to see momentum in aldosterone targeted therapies.
Peter: It validates the critical unmet medical need that we have been focused on for some time. We think this is a valuable mechanism of action in which we are targeting aldosterone at its source, which we think is a very important mechanism for helping to control hypertension. We continue to believe that our molecule <unk> that has the potential to be best in class.
Peter: And has a very competitive profile, we've shown data for this in Brighton, where we saw placebo corrected reduction of 11 millimeters of Mercury in systolic blood pressure at the two milligram dose.
Peter: With this molecule we think we are seeing.
Peter: Impressive.
Peter: It can be lowering at a low dose is sets us up well for treatment with both monotherapy and combination.
Peter: Our molecule has half life is at least double that of competitors and we think that's really important for 24 hour control of hypertension, and we don't see clinically relevant drug drug interactions with Baxter sat which again, we think highlight its potential to be a best in class molecule. So we think we're in a very competitive position we.
Peter: Look forward to reading out the phase III pivotal data for Bax HTM later this year.
Sean: Thank you Sean.
Speaker Change: Back to medical goods that first of all thanking you for your interest and your great questions.
Peter: And maybe in closing just like to so again, we have a.
Peter: Started very well the 2025 wherever growth momentum that continues well on track to achieve.
Peter: <unk> X.
Peter: Our expectations and our guidance and importantly, we are entering a catalyst rich failures as.
Peter: As we've said many times before by the end of the Charlotte next year, we'd have a very good sense for the driving factor is fog all systems and so so far so good we have five positive phase III studies.
Peter: <unk> fallen ones like sat on a six months of home and of course more recently.
Peter: <unk> nine <unk>.
Peter: <unk> had 13, one three of regulatory approval is of course, the major regions in the quarter our revenue.
Peter: Is up 10% and very much on track with what we expect.
Peter: Expenses are well managed and I know there has been a focus on SG&A. So I would like to attract your attention that Jennie O.
Peter: By 5%, even though.
Peter: We have many of the onshore so everybody is really walking up to manage those launches and component is G&A growth and as a result operating profit is up 20 trying to sorry, 12% now.
Peter: AEP is 21%.
Peter: So that's a really is.
Peter: A series of messages I wanted to leave you with is because again, we are very much on track so with that thank you. So much again and I wish you a good rest of the day.