Investor Update

Dec 16, 2020

Slides

Ladies and gentlemen, thank you for standing by, and welcome to the Galapagos Webcast At this time, I must advise you that this conference is being recorded today. Wednesday 16th December 2020. I would now like to hand the conference over to your speaker today, Elizabeth Goodwin. Please go ahead, madam. Thank you all for joining us today to discuss revised terms for Filgotinib with Gilead. I'm Elizabeth Goodwin, Investor Relations. And this, webcast is accessible via the Galapagos website homepage and will be available for replay later on today. Sales side analysts and professional investors will be invited to pose a question at the end of the call. And if you want to have, your question included, You could dial in now on 32 for Belgium, 27,93847. And the code is 7689939. You can also consult other numbers in our press release. I'd like to concerning future developments of the pipeline, results of future or ongoing trials, future commercial and financial results, growth of our company and possible changes in the industry and competitive environment. And because these forward looking statements involve risks and uncertainties, Glapagos' actual results may differ materially from the results expressed or implied in these statements. Today, we'll hear from Anil Von Estopa, our CEO and Michele Manto, our Chief Commercial Officer. During their presentation, you will see some slides progress on screen, and this will be followed by a Q and A session with our management board executives. At this point, I'd like to hand over to Anno. Thank you. Thank you all for calling in. I'll give you an update on the news we received from the FDA and the consequences of that news for Gilead and for Filgotinib. When we reported on the CRL earlier in the year, it became clear that there were 2 issues with regard to filgotinib getting to the market in RA. 1 was the, MANTA study that needed to be completed, which was a big surprise for us. Secondly, the fact that the FDA had an issue with the 200 milligram risk benefit, which also was new to us following on CRL, the normal path is to have a meeting with the FDA, the so called Type A meeting, to discuss what needs to be done to resolve the issues of the CRL that meeting took place last week and based on the outcome of that meeting, the FDA, the Gilead has decided not to go forward with applying for registration of filgotinib in RA in the United States. And the reason is that the FDA has not change is positioned with regard to the 200 milligram. They still believe that a risk benefit of that, dose doesn't outweigh, it's not positive in view of the 200 out to 100 milligram. The 100 milligram is also an active dose that's effective for treatment of the disease. And the FDA wants to stick to that dose. For Gilead, the 100 Milligram is not an option because of the competitiveness in the RA market. So they decided to pass on the opportunity to launch this in the U. S. As a consequence, the trials that were put on hold in the diseases that are associated to the RA disease segment in psoriatic arthritis, including spondylitis and uveitis. The decision has now also been made to not continue in those indications to, in phase 3 and to file for, these results for approval. That doesn't mean that Galapagos has given up on these indications. We will come back to you in due time, if and how we are going to continue with these trials for the European market and the Japanese market. But for the U. S, it doesn't make any sense to continue these large trials if there's no, possibility to file for approval in those disease areas. The second outcome of the Type A meeting was that with regard to the MANTA MANTA RACE studies, The FDA requires a follow-up of up to 52 weeks for any patient who does not recover fully by week 26, the data that become available in the first half of twenty twenty one. So it could be that we have no extension of the trial review when there are no patients that have not recovered. It could also be that there is a continuation of the follow-up based on patients that have not fully recovered. There are no new data in the MANTA and MANTA based studies on which the FDA has based its decision. It's clear that they very cautious with regard to the outcome of this trial. Clearly, not good news for filgotinib, for Gilead Galapagos and for patients, but it's the reality we got to deal with. Clearly, the IBD opportunity in the U. S. Remains We had a positive Phase III readout in ulcerative colitis with a 200 milligram, and we are continuing Phase III Crohn's disease trial, which data are expected in the first half of twenty twenty two. So Gilead remains committed to that. We believe that even if the 200 milligram is not acceptable for RA, it's could be possible. It should be possible apply for the 200 milligram in these indications. It's a different disease area with different medical needs. So we believe there is still a way forward for these indications. And it's a large indication as well. So we haven't given up on the U. S. For filgotinib, but for RA, the door is shot shot. Shut. So, the silver lining of this whole negative news is that we were able to negotiate and agree with Gilead on a commercialization of filgotinib in Europe. With the new deal Galapagos, we'll become responsible for all commercial activities in all indications in Europe. So quite different from the current situation where Galapagos has only very limited geographical responsibility for diseases in Europe, we now will get the full European rights to Galapagos in every aspect of the commercialization. So that will not happen from day 1 to day 2 because, the commercialization is underway. The lounge is underway. In Germany and we're at the brink of launching in a number of other countries. Galapagos has launched in the Netherlands So we need to have a good transition of all these activities to Galapagos. We will get a welcome a lot of the Gilead's commercial team into Galapagos. We anticipated about 100 people will transfer from Gilead to Galapagos over the coming months and we expect the full commercial commercial organization to be in place and the complete handover completed by the end of 21. So what does this mean for the economics? Well, the fifty-fifty P and L share that's currently in place the European commercialization will remain, in place until the end of 2021. After that Galapagos is responsible for the P and L. All commercial economics, will go to Galapagos as of January 22. And we have agreed on our royalty for Gilead between 8% 15% starting in 2024. By that time, the commercial organization, the commercial activities in Europe should be profitable. And therefore, we are willing to give Gilead the royalty at that point in time. There will be no more EU milestones, to Galapagos for filgotinib So no approval milestone for Crohn's or UC. And as a balancing point we will get the payments from Gilead of $160,000,000. Gilead will retain commercial rights outside Europe nothing changes there. And all milestones and royalties outside Europe will remain intact. So what is important to mention here is that the broader R and D collaboration that we signed with Gilead last year is not at all impacted by this decision by Gilead not to launch RA filgotinib. They have confirmed their commitment to the inflammatory market and to Galapagos with its collaboration that they signed and for which they paid a lot of money to get an option right to all the programs that we're going to develop over the next 9 years. So we still see Gilead as a very important and strong partner And it's unfortunate to what has happened with filgotinib in the U. S, but we are ready to continue our collaboration and deliver new mode of actions to the patients. So let's focus on on Europe and our commercial vision there, we believe that having the European rights on filgotinib is value creative for us. Of course, the 1st years are money losing as every launch of a pharmaceutical product in Europe is We have to build up the commercial organization. We have to start the sales, which we're currently doing within a couple of years. The breakeven point will come in after that we see a nice profitable market for Filgotinib in Europe and that economic value except for the royalties payable to Gilead is then fully for Galapagos. What this deal does, it accelerates our commercial presence across Europe, something we have told investors that, was our plan in view of the launch, the future allowance of 0 taxes debt, our second drug in phase 3 that is developed for IPF, idiopathic pulmonary fibrosis. And with this deal with Gilead, we can now build commercial organization as we speak throughout Europe to be ready for our second product as well. What also is important to note is that now with the deal with Gilead, we are completely aligned, with the overall R and D collaboration that we have at Gilead. Filgotinib was an exception to the rule, all other molecules that we have in the pipeline. And if Gilead takes an option. They will obtain the non European rights Galapagos will keep the European rights and therefore Filgotinib is now aligned with that collaboration, which makes perfect sense from an operating model which makes it all simpler and more effective and more agile. So although the, the U. S. Market of Filgotinib being out is a big setback. This is clearly a very nice silver lining that we can now commercialize Jayselika on the European market. So we're very excited about it. And I hope we can show the investors that, that is a great opportunity for Galapagos and to explain that in more detail I'm happy to hand it over to Mikaela Monto, our Chief Commercial Officer. Mikaela? Yes. Thank you, Arnold, and good morning. Good afternoon, everybody. So, yeah, there is a clear market opportunity for GESELICA in Europe. The market size you do you see is about $5,000,000,000 between $5,500,000,000 $6,000,000,000 at this price is the big size of that, the big chunk of it comes from Array, of course, the largest indication, with the IBD indication you see in Crohn's, with a high dynamic there and growth in the market due to the higher unmet need and also the launch of new model actions. And the fact also that the JAK inhibitors are not established there yet, so we'll have also bigger role to play. In this market, we have an ambition to reach a half a 1,000,000,000 peak sales in the second half of this decade, reached through achieving a market share range of 8% to 12% across geographies and across indications. Of course, reflecting the different potential and different market development in each of the European countries and also timing of reimbursement. For Gisela itself, we see continuously a big opportunity to succeed in Europe, we are confident with the European label and also extended to Japan. That reflects the strength of our data. The data that differentiates health differentiating towards established biologics therapies with the fast onset effects of efficacy, the lasting activity, the monotherapy also big demand from for RA patients. And of course, the convenience of being oral. Also, there are elements that differentiate further in terms of safety profile on the associated adverse events that are typically connected to JAK inhibitors. Also the 2 doses that we have approved in Europe and Japan. And last but not least, the rapid reduced responses that we have seen across the FINCH program. So looking at how we can deploy this in Europe, Anna already, alluded to that that it is a transition path. It's not an overnight change We'll start, of course, with the focus on the key markets. So the Benelux and the U5, the core of Europe where we already have our presence established and started with the deal we signed with Gilva last year. We have legal entities in these countries. We have already, launching in the Netherlands. We are preparing the reimbursement in other countries. And actually, we are now preparing for the intended transfer of the Gilead launching organization in Germany and for rheumatoid arthritis. For the other countries, we intend to have a transfer later by year end of 2021, in the Alpine. So Switzerland and Austria, the Nordic country, the Nordic Countries and Ireland there we will establish our legal entities and presence and then gradually transfer the organization in a efficient way, reflecting also our lean approach to commercialization. For the rest of Europe, highlighted here in green. We have a very programmatic approach. We know that our presence, but really evaluating how we then make just silica available as appropriate, but also considering third parties or other efficient opportunities. In that sense, we'll come to a full transition by the year end of 2021. So with that sense, looking at next year, for filgotinib, we'll have a different highlight, of course, both commercially and with development regulatory, starting in the first half with the availability of the 26 week results for month and month rate. And then the U. S. UC submission in Japan, also expecting the CHMP opinion in Europe for you see paving the roads than for the launch of UC in Europe, and then having activated the commercial transition. In the second half of the year, we'll then move to have, indeed, the approval and the launch of you see in Europe. And then the conclusion of the commercial transition, as I highlighted before. Moving then towards 2022, we'll have the Crohn's top line from diversity. Also, they're opening the next stage in the IBD commercialization. And then expecting the approval for UC in Japan, which then will move into 2022 second half with the potential submission for crohn's disease in Europe and also in Japan. And with that, I would pass back to a little bit Thank you very much. And that does conclude the presentation portion of the webcast today. We invite sell side analysts and professional investors to pose their questions. You can do so by pressing star 1 on the telephone. And let's give folks just a moment to do that. The first, color will be Dane Leone from Raymond James. Your line should be open now. And that's Yes, I can hear you now. Go ahead. Okay. Yes, sorry. The operator jumped in there as well. Yeah, so, thanks for the update in giving the great detail on the go to market in the EU. The questions have been coming back to us last night and this morning are pretty directly related from investors around the verbiage within the press release and update for what the FDA is looking for for the MANTA studies. So, as your teams walked us through over the years around a potential TTox signal. Everyone's been curious to understand when that will be. Resolved, I guess there's some concern that there might be a signal based on how the press release was written. So I just wanted to give your team an opportunity to clear that up. And what you've seen with MANTA and what the real discussion is with the U. S. FDA? Thank you. Walid, this is Walid. You answered the question, please. Thank you. Thanks, Dan. This is Walid. Good afternoon. Good morning, everybody. No, the MANTA and MANTA Ray studies are both ongoing studies. Both of them are blinded. There's been no signal, as I mentioned, 4, those trials are monitored by data monitoring committee. And every chance that they review the data they told us to continue with no changes. So we have no reason to believe that there's any signal and the FDA did not see any data that's different than what we have seen. The it's very difficult for me to explain the position of the FDA and why it moved from June 2019 where we were told that we could submit without they could evaluate the risk benefits of Filgotinib 102 100 milligram without seeing the actual data from the MANTA program to requiring to see the data, which would be normally the end the 26 week double blind placebo controlled portion of the study, which is designed in conjunction with the FDA and with every step of the way there, to now saying that they would want to see the full 1 year up to 1 year recovery period after the 26 week data. No reason has been given to us. No rationale has been given to us. It's very difficult for me to explain it. I'll be very honest with you. But I can tell you categorically, There's been no signal, that we've seen that they've seen that changed this. And the most informed people are the people on the data monitoring committee whose job to make sure that we monitor the safety of the trial and these professionals have told us to continue the studies as designed. So, with that, as you know, we will have the top line data from the 26 week at the first half of the year. Maybe also I'll share this information with you. The FDA is keen that the team remains blinded. So there's going to be a very small unblinded team that will be working towards sharing the information with the regulatory authorities, particularly the EU and Japan, where we actually selling our medicine and we need to adequately inform on the risk benefit to our patients who are actually being prescribed these medicines. But also we will be sharing this with the FDA, and we'll talk with Gilead about the way to do that. So, so that's the best information that I can give you. And I hope I addressed your question, Dave. Thank you very much. Yes, I think that is very helpful to all of us. Thanks for the team. I'll get back in the queue. Great. Thank you. Our next question comes from Phil Nado from Cowen and Company. Go ahead, Phil. Good morning. Thanks for taking my question. My question is on the commercial ramp as you assume the responsibilities for filgotinib Could you give us a little bit more detail about where Gilead was in building out its infrastructure in the EU5? And you mentioned that you'd take on maybe 100 so people from Gilead. Do you think that's all you'll need to promote in Europe and what other infrastructure will you need to build as you assume the responsibilities of Filgana? Michele. Sure. Thank you for the question. So to recap, with the previous agreement, Gilead was responsible for rheumatology in Germany and the UK, and we would be, we are responsible for Rematology in France, Italy and Spain. So at the current moment, the Gile team performed and he's performing the launch in, in Germany, with actual promotion and for sales coming in and preparing the launch pending, the nice reimbursement in the UK. And so this is the bulk of the people that on all the two when mentioned the 100. And these are organizations that were effectively staffed and prepared to have a strong launch and impact in these two markets. In the meantime, we have been preparing for the our launch in rheumatology in France, Italy, Spain, there, of course, the timeline is slightly different because of the different reimbursement timelines, with the 3 countries than expected reimbursement in the first in the first half of next year, and they're also ramping up in their activities. So that's the how then we will integrate our forces. And, yeah, we see that the sizing and the quality of the people we got on board are really strong sizing adequate to the competition in the countries, and also the quality of the people coming with a strong experience from, biologics, rheumatology, coming from the market leaders, companies then, to either Gillette or Galapagos. To make a strong launch with JESELica. Okay. Just one clarification follow-up. Do you feel like you're in a position to launch in France, Italy, in Spain, in the half of 'twenty one as soon as reimbursement is secured? Yes, this has been all the preparation we started a year ago. With the 2019 deal with Gilead. So we established our entities there. We've been recruiting. We've been acting on the reimbursement path have our organization there ready to go. Perfect. Thanks for taking my questions. Okay. Thanks very much. Our next question comes from Brian Abrahams at RBC. Go ahead Brian. Hi, this is Steve on for Brian. Thanks for taking my question. Could you remind us what the circumstances surrounding, metadata would be to a patient review and what could potentially lead to a delay in filing and it possible to run a post approval study or would the filing be delayed under that review? So I think that's the question for me. I, I'm not sure I caught exactly your question. Which indication were you talking about? Is it an RA or following the MANTA data for UC potentially. For UC, right. So the FDA now is asking to look at the 52 week data. However, once you have the top line results from the 26 week. We will be discussing this, with Gilead to see what is the best way to engage with the FDA. It's going to be a discussion that will be driven by data. And hopefully, we will be in a position to actually make a case to be able to move faster than the 52 weeks after the 26 weeks kind of thing? So. Okay. Thank you very much. Our next question comes from the line of Matthew Harrison from Morgan Stanley. Okay. We'll move on. Next will be Jason Gerberry from Bank of America. Just on the, the language in the press release about the different measures of sperm count measures for greater than 50% reduction. Is that just an endpoint measure or is there a specific reason why that threshold was mentioned in the PR? Just wanted to to clarify on that. And then just one quick question, just on your market sizing for inflammation roughly EUR 6,000,000,000 It looks like that's on a list price basis. And I wonder what the impact of recent biosimilars, I think with DNF Umira having come down about 50% on price. What do you think that market may be on a net sales basis, inclusive of the biosimilar impact of recent. Thank you. Jason, this is Waleed. I'll take the first question before I pass it on to Michele. Yes, the 50% reduction in sperm count, that's the primary endpoint of the trial. This trial, or both trials actually have been designed based on the FDA white paper where they essentially detail, the design. The endpoint, the duration, and the analysis. So this is a very well choreographed designed study based fully on a white paper by the FDA. And actually there are other studies that have been conducted, that are similar to this. And that's the standard endpoint that should be used in that front. So here's Mikhail. I'll take the second one on the market sizing. Of course, in Europe, we have different systems, different countries, that apply prices also in a different way. So what you alluded to the biosimilar will not impact all the countries in same ways. And also then JAK inhibitors as a class are not necessarily linked to that pricing. So that's a more elaborate answer. But you could consider a range between 15% 20% of differences between the the list price and the net prices, but it really depends on the geographies. Okay, thank you. Okay. Our next question comes from Peter Welford at Jefferies. Go ahead, Peter. Hi, yes. Can you hear me alright? Just one question actually and a follow-up. The question actually is just with regards to the R and D. I wonder if you could give us any sort of idea as to the rough level of R and D spend should be thinking about for, filgotinib in 2021 given obviously you obviously have to take on some extra responsibilities And if there are any sort of niche indications you could potentially consider? I know you mentioned that you disclosed Japan's disease in the current sort of psoriatic arthritis have indications. But I guess, you know, is there anything else you potentially consider now that perhaps Gilead didn't before given you're obviously in a slightly different situation now. And and do you have the flexibility to do that? And then if I could just ask Waleed, sorry, just just going back to the point about answer. I know we're dwelling on this, but your point about the fact that the team remains blinded. And and does that mean that from from our perspective, we shouldn't expect potentially any visibility on MANTA until I guess we get a response from FDA, yes, no, if you like. Because it sounds as though, you know, you presented the even management won't necessarily get any visibility on on what's going on with banter. Thank you. Okay. Hi, Peter. Let me take the first one. This is Bart speaking. Good morning. Good afternoon, everyone. R and D spend for 2021 for field goal And I'm going to give you an answer on the expense before implementing all the effects of this transaction. And I'll explain that in a second, in a bit more detail, but we anticipate under the existing construct where we pay percent of the development cost that we would spend somewhere between SEK 80,000,001,000,000 in the course of 2021 on Filgotinib development. And most notably, that is going to the Crohn's study, which is the biggest study that is still alive. And the other studies the FINCH 4 long term extension, Darwin 3 long term extension are also included in that package. Now so that gives you a that's the 50% cut on what the actual total expense of the program would be during that year. What you're going to see in our P and L is going to be a bit different at the end of the day, because Gilead has under this arrangement agreed to pay us an upfront of in total EUR 160,000,000, which covers their 50% share of development cost for a couple of years on a selection of trials. And we will be recognizing that revenue also progressing, the years progressing the trial execution. So let's get a bit of a complicated accounting methods, but give you a bit of perspective on those expenses. With regard to the niche indications and MANTA, Valitza, can I give that to you? As in as a question? Yes, sure. Thanks, Mark. Yes, so the FDA, would like to see the data of the 52 weeks monitoring phase or up to 52 weeks, as Ono has described before, depends on whether there will be people who will be meeting the criteria that we talked about at the end of 26 weeks and how long they will last, but the maximum will be 52 weeks before the date of birth. They wanted the study to remain blinded so that they don't introduce any buyers. And as such, Gilead put together what we call a data integrity plan that's been reviewed and approved by the FDA, which posits that the team that's actually working on the study will remain blinded and there's going to be a small team that will be unwinding such that they will be able to communicate with the regulatory authorities on the group level results. So indeed, I think, in terms of the information that will be shared externally, this is something that we need to discuss with Gilead and align on. But, to respect the data integrity plan, we cannot be sharing information about any details of this because otherwise, again, the team will become unblind and biased. So we'll provide more clarity on this as we move forward, but the the assumptions at this point is that, we will not be sharing information detailing the results with MANTA. Will be communicating directly with the regulatory authorities. And on the V issued location, if I'm sorry, and if I could just go back to the budget just with regards to the cost then, do we understand that in 2021 now you'll be booking the full cost, if you like, of the study, not your 50%, but that will be offset by the Gilead money and the revenue line, if you like. Is that the way we should think that you're paying for the studies now, but the 50% is offset by revenue rather than you booking half as you currently do. Yes, it's that's almost correct, Peter. So there's 2 categories. Let me be and it's also drafted in the press release, but there's 2 categories of trials, one category where we continue to book 50% of the costs and Gilead will pay the other 50%. And then there's another category where we will book 100 percent of the cost and the 50% share of Gilead is actually affected through this prepayment And indeed, that will be recognized as those costs will be progressing through 2021 2022. And Peter, what was the question regarding the niche indication? I missed it. Yes, I guess I'm just thinking with regards to some other indications, I think it was mentioned to start. I don't know that there may be some trust you may consider future plans of things like psoriasis, but I guess I'm thinking what about other indications that were not previously part of the agreement. Do you have the flexibility to do that and are there any other potential niche indications that may be Galapagos considered interesting whereas obviously weren't perhaps under the broad collaboration that previously existed? Yes, no, that's a fair question. So I think that the easiest one of the indications that were being considered previously. I think the team is actively looking to see whether we can think of, a development plan that would be appropriate for Europe and tailor made for Europe. And of course, that requires discussion with the CHMP on that. But other niche indications as well are on the table. And again, we have the flexibility to do that. But it's premature right now because the team hasn't really had the chance to dig into this and figure out path forward, that would be viable, both scientifically and commercially for Filgotinib for Europe on these. But we will communicate on those once we have clarity. Thank you very much. The next question will be from Lenny Fontaine Hazza from KBC Securities. Go ahead Lenny. In costs for 2021 considering the additional market that you will be tackling with the revised agreement. And Could you give us a sense of what those additional costs could be for that 1st year? And then secondly, could you please remind us of the timeline on the fistulizing and small bowel Crohn's disease trials that are ongoing. Gilead is of course in the lead in these trials And in that sense, are these new elements that will be explicitly communicated when they arrive? Thank you. Yes, let me let me take the first one and then Walid, you can maybe take the questions on the other indications in Crohn's So the ramp up on the investment details and marketing in 2021 will indeed continue. Let me remind everyone that the costs So the P and L results of Filgotinib in 2021 will remain fifty-fifty shares between Galapagos and Gilead But obviously, we were already under the all the arrangements planning to ramp up the investments on both sides both at elencaloparos as we are launching, in the various countries that Mikaela was describing. So yes, we will be seeing additional cost in the course of 2021, my current estimate, but we will give more detailed guidance in February. But my current estimate is that this will be an additional roughly 1,000,000 for the year 2021, compared to 2020. So regarding the, the studies divergence and I think 1 and 2, one is in the small Destin Crohn's and the other one was in fisualizing Crohn. Those were as you know, a small proof of concept studies, exploratory studies to some degree in that space to better and the efficacy of filgotinib in these indications, those studies are, I believe, we stopped them a bit earlier because, because again, they were small and it was very difficult to recruit and wanted to focus mostly on closed duty, considering also the, the corona situation. So we should be communicating on those, I think, sometime in first half of next year. We should be in a position to share more information about that. All right. Thanks a lot. Okay. Thank you. And our next question comes from, Greg Savannavey from Goldman Sachs. Go ahead, Greg. Okay, thanks Elizabeth and thank you for taking my questions. I've got 3, if I could. My first just has to do with in terms of comments, maybe I don't know if you earlier that you do expect, I guess, breakeven for Phil Go from a P and L perspective. Is there a year or a timeline that you're envisioning, where Filgotinib in Europe will become breakeven and what might that be? My second question, just has to do with the launch that, that is underway in German in that another lens. And I'm wondering if you can provide any color or quantifiable metrics on how that launch is going and you do intend to provide some of that on a go forward basis? And then my last question just has to do with in Europe, how do you intend to message differentiation and or the value proposition of Giseleca, in Europe to patients, physicians and payers, especially vis a vis, the AbbVie JAK inhibitor that's already out there. Thank you. Okay. The second and third question is for Mikaela. The first question, yes, we you can kind of read it in the press release where we agreed with Gilead on a royalty starting from 2024. And we believe that that is the year that, Filgotinib will be profitable in Europe. Vijayla? Yes. So on the launches underway, yes, the first half is Germany in the heads of the Gilead team in the Netherlands an hour. So it's still early weeks to provide a full same volume or sales update there. What I can say is that we are tracking on a weekly basis very intensively on the launch metrics that you would normally consider, right? The access, reimbursement, contracting, and is ongoing very intensively and very well. The other part is about the uptake and the adoption ladder, the input and the feedback is very strong as well in terms of appreciation of the differentiation features in efficacy and firming that the launch strategy is going the right direction. In terms of updates, so we'll see next year to hit the regular updates on how their launches going in the different countries, and then provide also more clarity on these steps. As of the messaging, well, we have, as anticipated earlier in the presentation, we are very confident about the file and the label. So we have, 2 doses approved, which give the right flexibility for physicians to prescribe with a 200 milligram recommended those for most of the patients, but also for the patients who might need a lower dose, we have that we have that too. And the power of the key part would be the safety profile that we've been discussing for, all along, the readouts of the FINCH trials that really make us different in the typically JAK associated adverse events. And that, again, on the early feedbacks we get from advisory boards, the individual rheumatologists, etcetera, resonates very well. All right. Our next question will be from Benoit Lache from Decor paid to come. Go ahead Benoit. Hello, good afternoon. Thank you for taking my questions. I have free from rights sides, again, also a bit on the cost perspective for the upcoming years. I was just wondering whether you can give us certain level of guidance on could we should we expect a dramatic increase now in the cash burn versus the full year 2020 guidance or would this be, more EUR 50,000,000 increase as was referred to in the expected increase in sales and marketing versus this year. And then on the peak sales, ambition of 1,000,000,000, Could you just confirm that this would imply for across all the indications of both RA and IBD? Or was this is this solely for RA that you mentioned this? And to finalize, I was just wondering whether you could give us your perspective on, the recent Phase III results of AbbVie's RINVOC on the their induction data, which was, I think, a couple of weeks ago. Yes, Bruno. Let me take, the first two questions and then I'll give the floor to Elite for that perspective on on the Phase III data. So in terms of guidance for 2021, again, this will come in all details in the beginning of next year. As a reminder, as a company, this year, we've guided for, a expense between 49520 1,000,000. That was a net expense, including the receipts of about 100,000,000 in approval milestones for Filgotinib in Japan and Europe. So our actual underlying spend in 2020 is, let's say, roughly a bit north of 600 between $600,000,000 $620,000,000. So that's the starting points. Indeed, we'll have, an increase in sales and marketing costs, as I was just describing, Otherwise, we try to keep our budgets under control as much as we can. We want to obviously balance properly the R and D investments that we can make and that we need to make in our pipeline with, the cash burn objectives that we have as a company. So we'll try to stabilize our expenses on R&D as much as possible, but on sales and marketing indeed and to a little extent also on G And A you will find some increases as I was describing earlier on in the call of that base of a little north of 600 then, just to clarify the points, indeed, the peak sales ambition is across RA and IBD. Malites on the Phase III program. I'm sorry, I missed the question. Can you please repeat that? Benoit, what was your question on Phase III, please? So maybe we've lost Benoit. He he did not he did not say which education. So if we don't have him on the line, then okay. I think we'll have to ask Benoit again. Yes. Okay. Sorry. Okay. No, me neither. Okay. So our next question is going to come from, Jason McCarthy at Maxim Group. Go ahead. Hi. This is Michael Kinewitz on the line for Jason. I'll ask about the MATI trial real quick and one follow-up after that. So I'd like to see just across your existing clinical data, have you observed any significant incidents of impact to seeing parameters that would indicate that whether or not you would have to continue for the 52 weeks? So the only thing that we measured in any of our trials were looking at hormones, in, reproductive hormones and we see no changes in those in our trials. We do not measure any semen parameters in our trials. These are notoriously highly variable, and that's why actually the agency is very prescriptive in the way a study to evaluate, these parameters has to be designed. And actually, it's very technical. It has to be analyzed in a certain way in in a very sort of a sophisticated type of laboratory settings that specialize in that. So no, we have not been measuring this. And I think this is linked to a question that Dane asked earlier. There's no indication from any of our clinical trials, any new indication that would suggest that we need to be looking beyond this. That is not the rationale why the FDA is looking for the 52 data. So just to be clear on that point. All right. Thank you. And then, the follow-up is, would an extension of the MANTA trial necessarily delay the filing for ulcerative colitis in the U. S? Or is there a possibility that the division of gastroenterology and inward errors accepts the 22 week data for filing? No, the position of the FDA is similar. As a matter of fact, discussions on MANTA involve the, virtually all the divisions, RAGI and actually GU the Urology Division whose responsibility is specifically, this organ system, so to speak. And so the default position is that the 52 weeks will be needed before UC can be filed. Now as I've mentioned before, once we see the 26 week data, we will have discussions with our partners to see whether there's an opportunity for us to reopen that discussion with the FDA based on those data. To see if there's a path forward that will be, allow us to file before the maximum of 50 week observation after the 26 week data. All right. Thank you very much. Okay. Thanks, Michael. Okay, we're going to go back to Matthew Harrison and open up the line from for him. Go ahead, Matthew. This is Connor on for Matthew. Thanks for putting us back in. So we just had a question basically on what your expectations are for your base case in terms of IBD in the U. S. And you mentioned that it sounds like you'll need the 52 week NAND data. And then I guess, how comfortable are you with with that being a possibility that you move forward? And I guess what is your base case in the context of IBD in the U. S? Thank you. I'm assuming this is a question from a regulatory perspective, not a commercial perspective, right? Correct. And then I guess how confident are you that it will be possible to move forward eventually with the commercial launch in IBD? All right. So I'll take the first part and then I'll learn that Nikita tackled the commercial element. So we believe that we have a package that is, very comprehensive evaluating actually both doses in induction and maintenance, we've demonstrated that with the 200 milligram, we hit our primary endpoint and the number of secondary endpoints and the biologic naive, but also in the biologic IR, we had primary endpoint and nominal lease, a number of secondary endpoint. And most importantly, in the maintenance trial, we saw very clinically meaningful effect in terms of maintenance of efficacy as well as steroids free remission in addition to the primary endpoint that we, which is the EBS remission. So we're quite confident in the efficacy profile of the 200 milligram. Now the safety as well, we probably shown these data as CGW, the safety of tolerability profile of Filgotinib, remained very good, and we believe the risk benefit for that dose is positive, in our opinion. Now the FDA, It's going to be difficult for the FDA to engage in fairness in evaluating this before we resolve the MANTA situation, which remains open as we talked about. So I think once we resolve that point, we will see what are the opportunities, that would that would be possible in the U. S. But the default position today is that the 52 week data from MANTA will be needed, and it's not very clear to us to what degree we will be able to convince the FDA otherwise once we see the 26 week data and we share with them. So that's my best guess at this point. Anything beyond that, I think I'm taking too much liberty at trying to interpret and it might not be very valuable, to be honest with you. Yes. Then to build on this, the key question indeed is about the regulatory situation there. So once this is clarified, the opportunity for you've seen diabetes is big is big in Europe and by definition even bigger in the U. S. So the ultimate need there is clear is bigger than it is in rheumatoid arthritis. And we've seen that with a faster uptake that the newborn of action had in the UC indications, in the ID indication. So with the gluizumab, for example, that is a much stronger, much faster than you would see in RA. So also the question about access, etcetera, that are in RA are to be taking a much lighter way, I would say, in IDD. There, of course, would depend on our label and our situation, but the point that that Vale highlighted with a search for your mission their fast onset of action, the durability in a very tested, in a very difficult to treat population as we had in selection. Oil point to a big opportunity, again, provided that the regulatory situation then supports that. And thank you. All right. And then I think probably our last question will come from the team at Kepler Cheuvreux. Go ahead. Your line is open. Hello, gentlemen. Thank you for taking my question. I would like to know, could you give us some more color about distillate opportunity in area outside Europe and mainly in Japan. What is Gilead position regarding this market. And maybe another, a very quick one, about the opportunity in PSA on ES, would you try to launch in Europe, or does the market is too small to launch by your own? Okay, thank you. I'll take the first Japan, give a first stab on the PSAAS and then bring it back to Vale for the regulatory and studies there. So for Japan, Gilead, as announced, is cooperating with Asia. Japanese company that has a big presence in rheumatology so that is indeed supporting the launch there and has all the elements connections and understanding of the rheumatology market to do that. So in Japan, rheumatology, is a very diffused specialty, so with a lot of individual physicians. And again, Aviso has all the connections and presence and relationships to make that successful. And also the label in Japan is the disease in Europe, favorable with the 2 doses and reflecting the strength of the data. From the FINCH program. For PSA and AS, well, they are 2 very important indications. And then of course, we would be glad to capture those opportunities provided that the the studies and the development, the regulatory environment supports that, given that, of course, we have to change the direction after the situation in the U. S. And I believe you can comment again on the point of how we could progress there. Yes, no, I mean, I think, we are in the midst of evaluating, what type of studies we would need that would allow us to get, an indication for ankylosing spondylitis and psoriatic arthritis in Europe. Once we put together a plan that would be a doable viable and and sort of in line with the commercial opportunity, then we will go talk to the health authorities in Europe and see if that would that would be acceptable to them. And if that's the case, then we will embark on this. But we're not, we haven't yet, we're not there yet. So we're still looking at this and evaluating our options. And we'll communicate once we have a clear idea about the next steps in those indications. All right. Thank you, everyone. That does conclude our Q and A session today. Please reach out to conference where Anna will also be presenting via webcast. Our next scheduled financial results call will be the full year 2020 results on 19th February. And we thank all callers for your participation today and wish you safe and healthy holidays. Thank you for participating. You may all disconnect.