Good day, thank you for standing by. Welcome to the Almirall full year 2022 financial results and business update. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press Star One One on your telephone. You will hear an automated message advising your hand is raised. To withdraw your question, please press Star One One again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Pablo Divasson. Please go ahead.
Thank you very much, Sandra. Good morning to everyone on the call. Thank you for joining us to review Almirall's full year 2022 results and business update. As per usual, you can find the slides to this call on the investors page of our website at almirall.com. Please move to slide number two. I would like to remind you that the information presented in this call contains forward-looking statements which involve known and unknown risk, uncertainties, and other factors that may cause actual results to materially differ. Please advise to slide number three. Presenting today we have Carlos Gallardo, Chairman and Chief Executive Officer, Mike McClellan, Chief Financial Officer, and Karl Ziegelbauer , Chief Scientific Officer. Carlos will start with the highlights and growth drivers. Carl will provide you with details on the progress of the pipeline before passing again to Mike to review the financials.
Carlos will then make some closing comments before opening up for a Q&A session. I will like now to pass it over to Carlos Gallardo to discuss highlights and growth drivers. Please change to the next slide.
Thank you, Pablo. Good morning to everyone on the call. Let's move on to full year 2022 highlights on slide five, please. I am pleased to say that we had a strong year for Almirall, both from a financial perspective and in terms of pipeline progress. We saw strong business momentum driven by our growth drivers, and we are pleased to have delivered on our guidance. The performance of the core business was driven primarily by our European dermatology business, powered by our recently launched products, which I will discuss in detail later in the presentation. Let me highlight the performance of our recent launches. We continue to see strong performance from Ilumetri, which continued good uptake in Germany and solid contribution from recent country launches.
Since the launch of Wynzora and Klisyri in Europe, we have achieved increasing market share in key countries, particularly in Spain and Germany for both products, while making excellent progress with the rollout in other European countries. We also continue to work hard on the pipeline with robust clinical updates on lebrikizumab. This year, we announced detailed results from the 52-week lebrikizumab phase III at the EADV congress in September and submitted the application for regulatory approval in October. Karl will give you additional color on this later on in the presentation. We continue to work with our partner, Eli Lilly, towards a targeted late 2023 European approval and launch soon thereafter. In the early stage pipeline, you will be aware that in 2022, we have entered into a licensing agreement for IL-2 mutein with Simcere.
We have also initiated the phase I study of our anti-IL-1RAP antibody during this past third quarter, and most recently in February, just a few days ago, we signed an additional deal for an option to license the IL-1Ra compound. Karl will provide additional details on these two assets later in the presentation. Let's now move to slide six to comment on the 2022 guidance. With 6.6% growth in 2022, we are pleased to have delivered on our mid-single digit coordinate sales guidance, and we also hit the mid-range of the EBITDA level. This strong set of financials and solid operation performance were driven by the core business, which continues to perform well and which is being driven by our recently launched products and strength in the European dermatology business. In the meantime, we're also making good progress on our pipeline.
Almirall business started 2023 on a high note and is ready to keep advancing in its pipeline development and prepare for lebrikizumab's launch. In addition, we have a good credit rating reflecting our healthy balance sheet, that we can use to actively pursue bolt-on acquisitions and in licensing opportunities that align with our corporate strategy. Please kindly move to slide seven to comment on our most recent European launches. Let me start with Klisyri in Europe, used to treat Actinic Keratosis. We are pleased with the commercial launch of Klisyri in Europe. The product is doing very well, with sales over EUR 9 million in 2022, having achieved a strong uptake. In Germany, Klisyri was awarded the most innovative product of 2022. It's gaining solid traction in the different countries where it has been launched.
The product offers a good profile, which represents a significant step forward in the treatment of actinic keratosis due to short treatment protocol, a once daily application for five days, proven efficacy, and high degree of safety. Moving on to Wynzora for patients with moderate to severe psoriasis, which we launched in May 2022. We are pleased with the progress, having achieved sales of over EUR 7 million last year, we have seen excellent traction in the first countries it's launched, with double-digit market share achieved in Spain and Germany. The rollout campaign also included the U.K., Denmark, Netherlands, and Austria. We are confident we can have a very nice uptake in these markets as well as in additional European countries in the upcoming quarters.
Ilumetri helps us strengthen our position in the European psoriasis market as we are the only company to provide a full range of psoriasis products covering the patient journey. Let's take a look at the Klisyri and Seysara business in the U.S. on slide eight, please. In the U.S., Klisyri has recently received a strong recommendation in the AAD guidelines. The product continues to gain penetration in the AK topical market with around 70,000 prescriptions since its launch in February 2021. It is a good result for a new product launching a market with numerous generic alternatives. Around 5,000 healthcare professionals have prescribed Klisyri since its launch, and we continue to receive positive feedback with good patient engagement. We have also made progress on patient access, achieving greater than 70% commercial coverage.
We continue to differentiate Klisyri for what is already available in the market based on efficacy, tolerability, and convenience. While we continue to focus on driving demand and gaining market access in the near term, over the mid-term, we are also working on the large field label expansion, which we hope to launch in 2024. Let's take a look at Seysara. We have seen continued volume recovery during the fourth quarter, reaching pre-COVID levels. Seysara continues to make steady gains with commercial lives with 75% commercial payer coverage. We have achieved a 6% market share in the antibiotic market and continue to focus our efforts on driving demand and improving the gross to net through better payer coverage. With both Klisyri and Seysara, there has been good improvement in 2022 in total prescription volume growth and market share.
We think these are two very good products with growth potential that will help build a more sustainable platform for Almirall in the US. With that, I will cover our biologic growth drivers on slide 10. Let me start with the lebrikizumab. Atopic Dermatitis is an underserved and large growth market, estimated to have about 5.5 million moderate-to-severe patients in the main countries in Europe by 2026. Those patients, almost four million, are expected to be on treatment at that time. Out of the moderate-to-severe patient group, we conservatively estimate new systemics will treat around half a million patients. One similarity with the psoriasis market is that we expect patients and physicians to use a number of different medicines, and we believe biologics will establish a meaningful share over time.
We believe that the percentage of patients treated by biologicals would likely be higher in time than current market estimates. Within the biologic share, we remain confident in lebrikizumab's competitive profile. Currently, there are only two biologics approved for moderate to severe atopic dermatitis. We believe that moderate to severe patients have not been well penetrated in AD and that biologics are only just starting to have an uptake. There is every possibility that lebrikizumab will be targeting a large unmet opportunity. However, we need to wait and see how all of this develops. We believe that in this field, where growth is accelerating and unmet need is very high, lebrikizumab has the opportunity to blossom. We are working diligently on various pre-marketing strategies in Europe and have begun shaping our sales force as appropriate.
For obvious reasons, we will not be able to share too much at this stage. Our excitement is strong, and we look forward to providing more information later this year and in 2024. Now let me talk about our other key growth driver, Ilumetri. Let's now look at the strong momentum of Ilumetri, our anti-IL-23 biologic for psoriasis in Europe. On the left side of the slide, you can see the market dynamics of the class, the anti-IL-23 in Germany, where we can see that the new patient market is clearly driven by the anti-IL-23 class, with over 40% market share of new patients within biologics. This is despite the recent launches in the anti-IL-17 class.
As you can see in the chart on the right, Ilumetri has shown a strong performance year to date, recovering from the seasonally flattish quarter three. We expect a continued strong performance during 2023. Good performance in Germany and new country launches have contributed to the overall strength, overall growth, sorry, and we are pleased to have achieved net sales of over EUR 36 million in Q4 2022. We expect further contribution for new countries in continuing to drive growth. During 2022, the contribution of the other European countries compared to Germany increased to around 50%, and we expect this good trend to continue. With this, I hand over to Carl to provide more details on the pipeline on slide 13.
Thank you, Carlos. Good morning from my side. This slide shows the progress of our pipeline. We're advancing our promising late-stage pipeline while building an exciting early pipeline. For lebrikizumab, we have filed a Marketing Authorization Application for atopic dermatitis with the EMA. We expect approval in Q4 2023. I will give you more details later. For Klisyri, we are working on an expansion to large field with a potential launch in late 2024 in the U.S. and 2026 in the EU. In the meantime, the recruitment for the U.S. study has been completed. We are in an advanced planning stage for the EU study. For Seysara China, the phase III clinical study met primary and key secondary endpoints. We plan to file with the National Medical Products Administration later this year.
For efinaconazole, we have submitted regulatory filings with an expected launch late 2023. We have also initiated phase I for our anti-IL-1RAP monoclonal antibody. Finally, we have recently entered into a license agreement for an IL-2 mutant Fc fusion protein with Simcere, and aim for a start of phase I later this year. As you can see, we are making very good progress with both our early and late-stage pipeline, and we are on track to strengthen our leadership position in medical dermatology. Next slide, please. Let me now explain the next step for lebrikizumab. As mentioned, we submitted a Marketing Authorization Application to EMA in October 2022. This application is currently under review and we expect approval in Q4 2023. In terms of clinical update, the ADvantage Phase III-B study is fully recruited.
Results from the week 16 readout are expected in the first half of 2023. As a reminder, the ADvantage trial is a randomized, double-blind, placebo-controlled Phase III clinical trial to assess the efficacy and safety of lebrikizumab in combination with topical corticosteroids in adult and adolescent patients with moderate to severe atopic dermatitis that are not adequately controlled with cyclosporine A, or for whom cyclosporine A is medically not advised. In addition, a pediatric study was initiated by our partner, Eli Lilly, in October 2022. We're also in advanced planning stage of an extension study to explore long-term benefits of lebrikizumab for up to five years. We believe that atopic dermatitis is a chronic disease that requires long-term treatment.
We think that lebrikizumab, with the potential as shown in our ADvocate studies to control the disease effectively with every four weeks dosing in the maintenance phase, is suitable to achieve this. In summary, we are very excited about the progress we are making with lebrikizumab and the totality of the data and the profile that is emerging. lebrikizumab shows a consistent profile across the clinical development program with more than 2,000 patients. Consistent across geographies, whether in monotherapy or in combination with topical corticosteroids in adults, as well in adolescents and across ethnicities. The safety profile is mild and consistent with prior lebrikizumab studies in atopic dermatitis. Atopic dermatitis is an IL-13 dominant disease, we believe lebrikizumab is the best antibody targeting IL-13.
For the maintenance of patients that responded at week 16, every four weeks dosing shows strong results that are like every two weeks dosing. Those data demonstrate the potential benefit that lebrikizumab could bring to both HCPs and patients. Next slide. This slide summarizes the progress we are making in building an early pipeline, starting with ALM27134, which is an anti-IL-1RAP monoclonal antibody that we recently in-licensed from Ichnos. ALM27134 blocks signaling of six members of the IL-1 cytokine family phase I is ongoing. We believe this is an opportunity to address unmet need in several autoimmune dermatology indications. Let me continue with ALM223. ALM223 is an IL-2 mutant FC fusion protein that activates regulatory T cells that we recently in-licensed from Simcere.
Preclinically, ALM223 exhibits an improved PK profile and the potential to restore immune balance. Start of phase I is expected in the second half of 2023. Finally, we announced a research collaboration with IsoPlexis, a U.K.-based biotechnology company, to explore novel approaches for IgE-mediated diseases. Preclinically, the lead molecule shows potential as a differentiated approach to treat IgE-mediated diseases such as chronic spontaneous urticaria. In summary, we are making good progress in advancing novel approaches to treat skin disease. With that, I hand over to Mike.
Thanks, Karl. Now on to slide 17. As Karl has mentioned in the introduction, we have seen a good performance in 2022, with core net sales growth of 6.6%, and we have successfully met our 2022 guidance. We've seen strong sales growth in Europe from the dermatology portfolio, which helped drive the overall core net sales increase. We achieved total EBITDA of EUR 198.3 in 2022, which compared to 2021 is impacted by a significant increase in our launch in R&D investments, as well as the absence of deferred income, partially offset by an increase in other income due to AstraZeneca/Covis milestones. In 2022, our gross margin came in at 66.4%, which was impacted by higher energy costs and inflation, which affected some of our material purchases.
This is in line what we have mentioned in previous quarters. SG&A for 2022 was EUR 409.7 million as we continue to invest heavily in our newly launched products, which we will discuss in more depth later in the presentation. R&D investments increased 40% and came in at 12% of core net sales, which is in line with our guidance. As we've previously outlined this year, we will have to pay for the phase III-B reimbursement focus studies for lebrikizumab, the Klisyri large field studies, as well as an increase investment in earlier stage assets such as the anti-IL-1RAP and the IL-2. We will also discuss this in more depth in another slide.
We recognize an out licensing income of EUR 18.5 million in Q4 from the Motilex transaction, which is consistent with our strategy to manage our mature product portfolio and is an amount similar to previous transactions in 2021 and 2022. This transaction helped us to partially offset the unanticipated negative impact which we had from inflation and energy costs throughout the year. Our strategy for mature non-focus products is to out license when we can generate more value than managing them ourselves. We are also looking to in-license assets aligned with our strategy of driving growth with bolt-on assets, such as the recent acquisition of the consumer care dermatology product, Physiorelax in Spain. We expect to continue to opportunistically manage our mature non-focus portfolio in the coming years.
We finished 2022 at 0.8x net debt to EBITDA, thanks to the good cash flow generation and the reduction in the pension plan liability. For the detail on core net sales, let's move to the next slide. You can see in slide 18 the dynamics of the core net sales. The European dermatology business recorded a very strong performance with an 18.4% increase year-over-year. We also had a solid performance in many of our general medicine and OTC brands, driven mainly by Spain due to good seasonality and sales force efforts. In our U.S. business, there's been an improvement in TRX growth in the fourth quarter. The full year net sales is down versus 2021. I will provide further details of that on the next slide.
Overall, it's important to reiterate that the portfolio has limited patent expiry risk going forward and in the midterm, aside from Efficib in Spain in 2023, where we are managing the pricing impact. We also had some downward pressure in the U.S. legacy business, which we will see on the next slide. Rest of world dermatology sales showed good growth year-over-year, while general medicine has seen a small decline year-over-year, mainly driven by Immunorex in Latam, which had very high demand during the pandemic in winter months of 2021. Let's take a closer look at dermatology business on the next slide. On slide 19, as you can see, we had a very strong performance in Europe, driven by the growth of Ilumetri, as well as good trends for our Decaderm franchise and growth in Solaraze.
Other EU dermatology is also benefiting from the initial launches of Klisyri and Wynzora in key markets. Focusing on our U.S. business, we see good progress in TRX and market share of Klisyri and Seysara, although we still need to improve the gross to net results as we work to create a strong customer base for the brands. You can see the legacy business in the U.S. remains under pressure related to ACZONE and including additional competition with TAZORAC, which was seen in the second half of 2022. In rest of world, we've seen a significant growth related mainly to the stocking of Cordran Tape in Japan, driven by a change of contract manufacturers. Moving on to SG&A and R&D details in the next slides.
On slide 20, we want to highlight the details of SG&A evolution to better explain the current and future drivers of costs within SG&A. A significant driver of SG&A development is related to our newly launched products in Europe. This is mostly focused on the ongoing rollout of Klisyri and Wynzora, as well as support for the high levels of growth of Ilumetri and the pre-marketing expenses of lebrikizumab, totaling an amount of EUR 34 million in the year. We've seen around EUR 12 million of FX impact, mainly related to the U.S., which saw a slight decline in local currency.
Finally, we have optimized our portfolio by reducing investment in the mature and non-core products. Overall, we've cut expenses in the base business by EUR 29 million. For 2023, we will increase our investments in lebrikizumab as we get closer to launch, and we will keep investing in our growth drivers.
At the same time, there will be more limited scope to further reduce costs in the rest of the portfolio, and we will have some added labor cost pressure from inflation. Now let's move on to the next slide for R&D cost evolution. As you can see on slide 21, R&D cost growth in 2022 reflects the investment to advance both our late-stage and early-stage pipeline. We have the lebrikizumab cost mainly related to the phase III-B studies, amounting to a total of EUR 8 million incremental increase compared to what we already invested in 2021. For Klisyri, we've had a EUR 7 million increase, including the large field study in the U.S. We've also been quite active during 2022 in relation to our early-stage pipeline, including the phase I study of the anti-IL-1RAP and other preclinical projects amounting to approximately EUR 9 million incremental in total.
We have had other minor items such as energy costs, inflation, and an increase in personnel related amounting to EUR 6 million. 2023, we will keep investing in R&D on mostly the same items and expect to be in the similar range of around 12% of net sales. Bear in mind that 2021 was unusually low spending year as we discontinued part of the previous early stage portfolio. Let's move on to the next slide with an overview of the rest of the P&L. On slide 22, we can see that this successfully met our guidance by achieving mid-single-digit core net sales growth of 6.6% and a total EBITDA of EUR 198.3 million, hence hitting our target of EUR 190 million-EUR 210 million.
I've already highlighted the key factors on sales performance, let me continue with our focus on the core business by running you through the rest of the P&L. Year to date, we achieved a gross margin of 66.4%, which was impacted by higher energy costs and inflation affecting our material purchases, as we mentioned in previous quarters. I will not go into detail on SG&A and R&D, as we've already dealt with that in previous slides. The reconciliation at the end of the P&L reflects the deferred income in previous year, which was fully amortized in 2021. Total EBITDA of EUR 198.3 includes EUR 12 million of other income, due to milestones following the AstraZeneca Covis Pharma agreement. Let's now continue down the P&L. Turning to slide 23, there are not too many items to go through.
I'd like to remind you that our effective tax rate is affected by our inability to deduct U.S. tax losses against the profitable European business. We expect this to continue going forward. Early in 2022, we discontinued the sale of certain products of the legacy portfolio in the U.S. as our contract manufacturer discontinued production and alternative suppliers were too expensive, thus triggering an impairment. We continue to focus on keeping the U.S. business sustainable through the growth of Seysara and Klisyri. Financial expenses have been impacted by the lower share price connected to the equity swap on the balance sheet. The impact of 2022 is close to EUR 6 million, with the remaining expense being the ongoing interest impact following our refinancing in 2021.
I'd like to highlight that we finished 2022 with a normalized net income of EUR 33.5 million, which resulted in the normalized earnings per share of EUR 0.18. Please move to the next slide to look at the balance sheet in more detail. On slide 24, you can see there are quite a few comments provided on the slide. I'll just highlight two of the most important factors. Some financial assets have been reclassified to accounts receivable following the agreement with Covis to advance certain milestone payments related to the China respiratory business. There was also a slight decrease in financial debt related to a reduction in our pension plans due to the increasing interest rates.
We finished 2022 at a leverage of 0.8x EBITDA to net debt and a healthy cash position, which gives us flexibility in the current environment for additional licensing and M&A activity. Let's take a look at the cash flow statement on the next slide. On slide 25, you can see we delivered operating cash flows of EUR 155 million in 2022. We've seen normalization as expected from the change in working capital following the timing impact on accounts payable and receivable balances earlier in the year. Tax cash flow turned to a net outflow due to a change in the phasing of net refund of corporate taxes in Spain. In 2021, we received refunds for two years during the first and fourth quarter instead of a single refund that year, as we had seen in previous years.
We see this as a phasing in effect from the change in how the Spanish government refunds taxes. We made key investments in 2022, including the upfront of the anti-IL-1RAP from Ichnos, the IL-2 mutant fusion protein from Simcere, and other regulatory and launch milestones for lebrikizumab, Wynzora, and Ilumetri. The divestment line here refers to milestones and royalty collections from AstraZeneca and Covis that have been classified as investing activities due to the reduced focus in our operations. Finally, there was a decrease in debt related to the regular loan repayments with the European Investment Bank. Free cash flow in the fourth quarter was flat due to the investments in milestone payments related to lebrikizumab, Wynzora, Ilumetri, and others. Let's now move to 2023 guidance on slide 26. In 2023, we expect net sales growth of low to mid-single digit.
In terms of total EBITDA, we expect to be between EUR 165 million and EUR 185 million for the full year. I want to outline the guidance assumptions that we're using for 2023, which includes some pushes and pulls. We anticipate the increase in net sales mainly coming from the continued expansion of Ilumetri in Europe and the new launches of Klisyri and Wynzora across Europe. In addition, we anticipate a positive contribution from Seysara and Klisyri in the U.S. On the downside for sales, the patent expiry of Efficib Tesavel in Spain will have a full impact in 2023, and some products in the U.S. like TAZORAC will see further deterioration due to additional generics. Additionally, we are taking into account some price pressure in Europe across our portfolio. We expect the other income line will normalize to the underlying royalty of single-digit millions.
On spending trends, we intend to invest to support our recent and upcoming launches, which will lead to an increase in SG&A spending in the mid-to-high single-digit range in 2023. We'll be preparing for the launch of lebrikizumab, additionally, we will continue to invest in the launch of Wynzora and rollout of Ilumetri and Klisyri in Europe. In 2023, we expect R&D spending to be around 12% of net sales, these are the three factors driving the sustained level of high R&D. First, the Phase III-B studies for Lebri, where we will have to pay the cost for the reimbursement studies in Europe. Secondly, the spending on Klisyri large field. Finally, we will increase spending on earlier-stage assets such as the anti-IL-1RAP and the anti-IL-2 mutein we mentioned before, as well as other early-stage projects.
We will also continue to see a high effective tax rate in 23 due to the U.S. effect on the tax loss position. For the cash flow, we expect lower operating cash flow in 2022 due to lower EBITDA and potentially higher outflow impact of tax payments. Investing activities will increase slightly due to lower divestment inflows following the positive impact of Covis AstraZeneca deal in 2022. Any M&A or additional licensing activity during the year could lead to additional cash outflows in investing activity. With that, let me pass it back to Carlos to conclude the presentation.
Thank you, Mike. Please let me give you a quick reminder of the news flow that we expect going forward. As previously mentioned by Karl, EMA accepted our Marketing Authorization Application for lebrikizumab in Q4 2022. The anti-IL-1RAP compound has started phase I in the first half of 2022. It is a first-in-class, fully human, high-affinity monoclonal antibody against human IL-1RAP, which can be applied across different autoimmune skin diseases. Klisyri's large field expansion will be potentially launched in late 2024 in the U.S. and 2026 in Europe, with significant upside in treating actinic keratosis. Seysara clinical trial in China is ongoing phase III to tackle acne, and the recruitment has been completed. We signed a licensing agreement for IL-2 mutein with Simcere, further development of which can potentially address various unmet needs in autoimmune dermatology indications.
Phase 1 is expected to start in the second half of 2023. We expect lebrikizumab to be approved in Europe in the final quarter of 2023. The regulatory filings for efinaconazole have been submitted, and we're expecting to launch this year to enable onychomycosis treatment. Let's please turn to slide 29 to discuss Almirall's priorities in the capital allocation for creating long-term shareholder value. Let me remind you that we are fully committed to creating long-term shareholder value with growth expected to accelerate in the coming years with recent and future launches. Our capital allocation is focused on four main principles. First, invest in current and future product launches in dermatology to drive significant mid-term revenue acceleration. Second, innovation by strengthening the pipeline, both by proprietary research and in-licensing assets. Third, maintaining a secure, stable dividend to our shareholders.
Fourth, thanks to our prudent approach, we have a healthy debt profile, allowing for inorganic growth while maintaining a solid liquidity position. A good example of this is the recently acquisition of Physiorelax in Spain. This is a product that complements our consumer health care business and has the potential to generate further synergies. Let's move to page 30 to conclude the presentation. To wrap up, we have delivered a good operational performance in 2022, achieving our guidance. Our focused strategy in the medical dermatology space positions us well for the mid-term. We continue to execute on the transformation of the company by preparing the business for the launch of lebrikizumab, with pre-launch activities advancing in key markets in Europe. We are confident that Almirall growth drivers will continue their trajectory during 2023 as we continue to support key products.
Ilumetri has had a very strong performance, and we expect increasing contribution from new country launches to continue the growth during the year. We also expect the positive trends of the rollouts of Klisyri and Wynzora to continue during the year. As detailed by Karl, we are progressing well with our exciting innovative late-stage pipeline, while at the same time, we are strengthening our early-stage pipeline with exciting new assets.
Almirall is well positioned for long-term growth. This growth will come from both current and future growth drivers, and also we continue to explore inorganic growth options as we have the opportunity to leverage our strong balance sheet and flexible capital structure. With this, we conclude the presentation. Pablo, I hand back to you for instructions on Q&A.
Thank you very much, Carlos. Sandra, back to you for the Q&A, please.
Thank you. As a reminder, to ask a question, please press Star One One on your telephone and wait for your name to be announced. To withdraw your question, please press Star One One again. Please stand by while we compile a Q&A queue. We will now take the first question. It comes from the line of Harry Sephton from Credit Suisse. Please go ahead. Your line is open.
Thank you. Three questions from me, please. Firstly, can you comment on how you expect recent changes in the German AMNOG pricing to affect your portfolio? Maybe more specifically on Lebri, it looks like you'll have to take a 10% discount to Dupixent unless you do a head-to-head study. Is it fair to assume that you are comfortable in taking that 10% discount at this time, given time is running out to actually run a head-to-head and have it submitted to AMNOG in time? My second question is on the Klisyri large field European launch. It looks like your expectation here has been pushed back from 2025 to 2026. Is there any specific reason for the delay there?
My third question is that given the ongoing losses, you have in the U.S. and the unfavorable tax treatment, does it strategically make sense for you to remain in the U.S. market? Thank you.
Thanks, Harry. Let me take the first one, then I'll pass over to Karl. You know, you're right with the German AMNOG. We anticipate that in our launch in Germany. We will probably need to take some discounts versus Dupixent because of the timing of the process. We still think we will have a very good value proposition. We think we will get off to a very good start. You know, we're still in the filing process. We do think we have a very solid asset which could have some very good upside versus Dupi in many ways. Yes, that is an impact we need to take into consideration, but it is part of our plans. Karl, you wanna take the second one?
Yes. Thank you, Mike. Thanks for the question, Harry. I mean, when we look at Klisyri large field, it's important to acknowledge that there are differences in the way regulators look at this between the FDA and the EMA. In the U.S., we have basically an agreement with FDA for the extension to large field to do a PK and a safety tolerability study with about 100 patients that has been fully recruited. We expect read out this year and then a potential approval in 2024. In the EU, the situation is slightly different. Here, regulators, as part of the approval, ask us to do a post-approval safety study.
That is a larger study of about, 540 patients where we compare Klisyri against diclofenac, in terms of incidence of biopsy-proven squamous cell carcinoma. We expect the study runs roughly until 2026. Again, that's a different, background, study for the large field expansion. Uri more likely includes, in addition to safety and tolerability, also, efficacy endpoint. As said, we're in advanced planning stage. Given all the considerations, it's now more likely, that we then look at an approval date in 2026 rather than 2025. Another. Carlos, over to you for the last question.
Yes. Yeah, Harry, thanks for the question. On question number three about the U.S., the answer is yes, we will continue to be in the U.S. Our ambition is to become a global leader in medical dermatology, and the U.S. is the largest and most important market. If you look at our efforts to build an exciting pipeline, all the products that we are in licensing has U.S. rights and of course the proprietary products as well, right? We need to continue to have an operation there to prepare for future launches. Additionally, in the short term, we are expecting Klisyri and Seysara to continue to grow in terms of demand generation, in terms of prescriptions. Also we have a number of initiatives in place to improve the gross to net.
Brilliant. Thank you very much.
Thank you. We will now take the next question. It comes from the line of Alistair Campbell from Royal Bank of Canada. Please go ahead. Your line is open.
Thanks very much for taking the question. I wonder if I could just press a bit more on the U.S. losses and the tax situation. Can you maybe give an indication if the U.S. was to get to breakeven, what you would expect the corporate tax broadly to look like? Can you give an indication of any kind of accumulated tax losses that you might be able to offset against future profits in the U.S. if and when you reach that point? Just as a broader point on the EBITDA margin.
Obviously, further investment this year ahead of your launches, it's gonna take an EBITDA margin down to sort of probably a nudge below 20%. Historically, you've had sort of high 20% range for the EBITDA margin. Just a question that once the company has established Ilumetri and lebrikizumab, is there any reason why margins shouldn't get back to those levels over time? Structurally, is it gonna be a different organization? Thank you.
All right. Thanks, Alistair. I can take these two. You know, the U.S. is in a tax loss position, mainly from the amortization of the intangibles of the previous acquisitions. If we were to strip out the U.S., our tax rate would be more normalized in the low 20s. Very normal with a Spanish company. We are accumulating, you know, tax losses at this point, you know. Until we have clarity as to when the U.S. will be profitable, we are not booking those as deferred tax assets. When we do get to profitability in the U.S., we could have a swing the other way, helping us out quite a bit on the tax line.
In terms of EBITDA margin, you're right, we will be, you know, in the high teens, low 20s. You know, our goal, our aspiration is, you know, five years from now to be back in that mid to upper 20s range. You know, that, of course, requires us to do very well with Ilumetri, to launch lebrikizumab very well, and continue to move forward the rest of the portfolio.
Great. Thanks, Mike.
Thank you. We will now take the next question. It comes from the line of Peter Welford from Jefferies. Please go ahead. Your line is open.
Hi. Thanks. Just a few follow-ups, really. Firstly, just with regards to, you said your outlook assumes in Europe some pricing impact this year. I wonder if you can just talk a little bit about what it is you've assumed and sort of which countries are key to that? Secondly, in the sort of low to mid-single digit range of the outlook for sales is perhaps a bit broader than you've given in the past. Can you just talk a little bit about what are the pushes and pulls to give you that perhaps slightly wider sales guidance than you have done? Then just secondly, a few sort of housekeeping issues. Firstly, you said the divestment income would be sort of normal given your optimization of the portfolio over time.
Can you talk a little about that? What should we assume in terms of your assumption within the outlook for this year with regards to divestment income within the P&L? Also you rattled through a few of the pushes and pulls for the P&L during this year. Can we just go back to did you give an outlook for SG&A growth at all this year? Did I hear correctly, you also gave an outlook for royalties income, and what we should assume for that this year and going forward? Thank you.
Okay. All right. Looks like fun stuff for me. you know, in the outlook, we do have some pricing impacts. There are some changes in healthcare contributions in countries like Germany and a few others. I would say in total, you know, around the EUR 10 million range, but we'll see, you know. We're keeping a very close eye on things. That's something that could develop in that range that we have, is if there are more pressure in some of the markets, we could see more. But we've anticipated at least what we see on the horizon. I think that flows into the second one. The reason we're giving a wider range is exactly that. We, you know, we're going into a year where we just don't know if there's going to be further pressure on the healthcare systems in Europe.
You know, we would like to be towards the upper end of what we've guided, but we need to be a little cautious. We just don't know what's gonna happen in Europe. In terms of divestments, I would assume that we will have a normal amount. We've had small divestments in the last four years. I would assume just a similar amount there in 2023. Nothing particular at this point, but we do see those things come up throughout the year. This is part of our, you know, portfolio rejuvenation, if you wanna call it that. When people come and offer us amounts for some of these small non-core assets, we look at them, and if we can get more than our NPV, then we transact.
At the same time, we are looking, as Carlos said, to do bolt-on acquisitions. We've done a very small one in Spain for an OTC product, but if there's other things in dermatology or in our general medicines business in Spain, we will look at those very actively. In terms of SG&A, I think I said mid to single-digit growth, mid to upper single-digit growth. That's what we would expect. It's really focused on the pre-launch of lebrikizumab, continuing to drive Ilumetri, and rolling out Klisyri and Wynzora in some additional European countries. Investments in the U.S. will be flat, so we're not increasing investment there, but we are looking to rebound in the key products.
In terms of the other income, you know, we had a nice little one-time bump in 2022 from the signing of the deal with Covis and AstraZeneca to advance some of the milestones in China. Next year will just be the typical single-digit royalties in that line. I think I've covered everything.
That's great. Thank you.
Thank you. We will now take the next question. It comes from the line of Jaime Escribano from Banco Santander. Please go ahead. Your line is open.
Hi. Good morning. A few questions from my side. Although you have given guidance, in terms of gross margin 2023, what should we expect? Something in between 65%-66%, would that make sense?
Second question, would be regarding new products, the one for onychomycosis, efinaconazole. Can you remind us what is the peak sales of this in combination? I don't know if there is some cannibalization with the, with the Klisyri or just to how should we think about, you know, this product in combination with your current portfolio in terms of peak sales. Final question, regarding can you remind us the milestones you have to pay in 2023 for housekeeping purposes? Thank you very much.
I'll take these three as well. Thanks, Jaime. In terms of gross margin, you know, I think your range is fairly okay, 55% or 65%-66%. I would expect from the 66.5% roughly we had this year to see potentially pressure of 50-75 basis points. It really depends on the mix, but we are continuing to see inflation. We're seeing the passthrough in our suppliers of additional cost increases as they've hit inflation and material costs. I think that's a relatively good number. In terms of the new products, we've never really given peak sales for efinaconazole because it's additive to the portfolio. There will be a slight amount of cannibalization, but we also see it as a nice way to expand that.
It's really tough for us to give a concrete number. I would say, you know, after we have a little bit of experience with it, we'll give a little bit more of a feel for what we think. Let me answer the next one real quick, and then I'll pass over to Karl to talk a little bit more about the process for efinaconazole. In terms of milestones, and I'd say that in total investment outflow will be the same if not just a touch more in 2023 than we saw in 2022, because we will have some milestones related to the approval of lebrikizumab we're expecting. We'll have some sales-related milestones on some of our other deals, and we do continue to see some investment in early-stage assets. Karl.
Just to on quick update on efinaconazole. You know, we'll made it with, you know, basically existing data in a decentralized procedure in Europe, in Germany, and in Italy, with Germany as a reference member state. Just to remind that, you know, efinaconazole will be a prescription product where Revidol and OTC product. We think that this is rather complementary. What makes efinaconazole attractive from our point of view is that, you know, it has molecular property that resides in a very low binding to keratin, the main component of toes. With that it has a strong penetration and therefore can deal with this maybe more severe and deeper infections.
An OTC potentially those product goes potentially more for the kind of milder infection.
Okay. Thank you very much.
Thank you. We will now take the next question. It comes from the line of Guilherme Sampaio from CaixaBank. Please go ahead. Your line is open.
Hello, thank you for taking my questions. Three from me, two on lebrikizumab. The first one, if you have any additional details on the need for further studies beyond the ones already disclosed, on leri. Second question, if you have any additional conclusion on the extremely high phase III efficacy data of the placebo arm in lebrikizumab 52 weeks results. The third question, if you could talk a bit more on your initiatives to improve growth. Thanks.
Yeah, thank you, Guilherme. Maybe I'll start with the lebrikizumab. I think first of all, when we look at lebrikizumab, we are looking from the clinical trials where we already have read out to a very strong data package. I think this will be now complemented by, you know, the data from the ADvantage trials I mentioned earlier. We expect the readout in the first half of 2023, but also in addition by studies Eli Lilly has initiated. I mentioned the pediatric studies, which is in children older than six months and up to 18 months. They're studying lebrikizumab in two peaks and pre-exposed patients. They're studying lebrikizumab in patients with skin of color. Again, complementing the already very exciting data package we have.
With Aggress Tuner, I think, Mike, can you take care of this question, please?
We've got a lot of things going on in the U.S. first of all, we've expanded coverage next last year, but now we're needing to continue to refine our methodology of getting past the step edits and the prior authorization. A lot of work is going into our pharmacy network to turn more and more of the potentially covered scripts into covered and to reduce the amount that we put into consignment. We're also, you know, fine-tuning our targeting of physicians in areas that have better coverage versus areas that have less coverage and many other initiatives that we can re-reveal a little bit later when we see how they're working. A lot of effort is going into capitalizing on the very good TRx momentum we have.
We've gotten the market share of Seysara up above 6%. We've got the market share of Klisyri up, about 5%. We're continuing to grow the prescriber base. We are getting more depth, but we need to continue to push in the right way to capitalize on the coverage expansion that we've had last year. A lot of efforts are going on, and hopefully we'll be able to come back to you later in the year with some success stories.
I think it's just a follow-up on the placebo data that I think you did not answer.
Oh, yeah, the placebo data. Can you answer that one, Karl?
Maybe I didn't have it. Can you please repeat your question?
Yes, it's possible. We've seen extremely high, phase III efficacy data on the placebo arm in the lebrikizumab 52 weeks.
Okay.
If you have any further conclusion on the why is that and the, how could you read this?
Yeah. When you look at this data, I think it's important to keep in mind that the patients after 16 weeks, that were then re-randomized for the maintenance phase, they are already very well controlled. You know, we started on average with an EASI score. That is a score from 0 to 72 of about 30. Yeah. The patients were treated for 16 weeks, those patients that were re-randomized had an EASI score of about two to three. Based on that, they were randomized to every four weeks lebrikizumab every two weeks and receiving no treatment.
As lebrikizumab is an antibody with a very high potency and affinity in the picomolar range and a very low half-life of about 25 days, we believe that those different factors are well controlled, but also the excellent properties of lebrikizumab have contributed to this high maintenance of disease controls, even in patients that didn't receive any further treatment between week 16 and week 52 when there was the readout.
Okay. Okay, thank you very much.
You're welcome.
Thank you. There are no further questions at this time. I would like to hand back over to Pablo Divasson for final remarks.
Thank you very much, Sandra. We are now going to close our Q&A session. With this we will complete our conference today. We want to thank you for your participation. You may now disconnect. Thank you very much.