Hypera S.A. (BVMF:HYPE3)

Hype Day 2021

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Apr 9, 2021

Good afternoon, everyone. Welcome to the Hype Day. I'd like to start off by saying that it's a great pleasure to be able to talk about Hypera Pharma, this giant in the Brazilian pharma industry that is getting ready for the future. In our event today, we're going to learn more about the challenges and opportunities for sustainable growth of Hypera Pharma. We're going to talk a lot about technology, about digital, about innovation, about new avenues for growth and about sustainability. So let me introduce who will be with us here today. Let me show you on the screen. We have Bruno Oliveira. He's our CEO. He'll talk about who Hypera is, strengths and recent performance. Adal Mario Coto, the CFO and the Head of Innovation. Adamario will talk about the pipeline of new products. Vivian, our woman representative here is the Head of Strategic Projects and we'll talk a lot about the Hypera Hub and Hypera Ventures. And Luis Clavis, the Vice President of Marketing and Sales will talk about generics and the digital transformation. To make this an even better conversation, we can count on your participation. So use your phone. You can see the QR code on the screen. Scan that and submit your question or use the tab on the screen. So we really would like you to participate. All questions will be answered at the end of the event. I'd like to reiterate that this is fully online and that everyone in the studio is following the social distance recommended by the WHO and all the protocols. Everybody has taken a COVID test before working and we're ready to have a great afternoon. So this company is the leader in the preference of all Brazilians with renowned brands that are already part of your day to day in the last decade. In addition, Hypera has the strong ability to invest in innovation and production with robust distribution that taking its products to 96%, I said 96% of households in Brazil. And it's the only pharma industry with a relevant position, a relevant share in all market segments. Hyper Pharma is the absolute leader in non prescription drugs and the owner of many brands such as Manticorp Skincare and NeoChemica that highlight in Rx and over the counter and generics and dermocosmetics. In last year, the company has beat all records even though it was a challenging year given the COVID-nineteen pandemic. The records show the resilience of the Brazilian pharma industry and reiterates the importance of the Hypera Pharma strengths to have a sustainable growth. The company beat records in investment in research and development in 2020, BRL $350,000,000. You can see right behind me. So Hypera Pharma had record operating cash generation and highest net revenue since it started focusing its operations exclusively in the Brazilian pharma industry. Hypera also maintained its commitment in shareholder compensation, achieving record dividend payouts in 2020 and more. The company has expedited its investments in technology, concluding transformational acquisitions that made the company pursue leadership in the Brazilian pharma industry. Hypera Pharma is looking at the future with responsibility, investing strongly in its strengths and still remains firm in its mission in offering quality healthcare for Brazilians so they can live more and better. I'd like to invite Brenna Oliveira, the CEO of Hypera Pharma, who will talk about the future of the company. Bruno, the floor is yours. Good afternoon, Caio. Good afternoon, everyone. Welcome to Hype Day twenty twenty one. I hope that everybody is well and healthy in such difficult times that we're going through here in the country. Today I'm going to talk about recent Hypera performance, the strengths of the Brazilian pharma industry, the competitive advantages of Hypera and all the fronts that we are working on that will take us to the sustainable growth of Hypera in the medium and long term. Since the beginning of 2019, when we changed our strategies and started to focus 100% on sellout, we had good growth, growing sellout above 10% in a consistent manner when we were strongly affected by the pandemic. As we've mentioned before, the impact was mainly in the flu market, acute medicines, and sunscreen that were strongly affected in the 2020. The good news is that these markets are gradually recovering in other markets that benefit such as prevention markets, especially multivitamins and vitamin D maintained this good performance and we are growing more than the previous moments and above the market in the 4Q twenty twenty, close to 15%. That's the growth level that we expect for Hypera in 2021 even considering this current scenario. Although we have the uncertainties in the short term scenario, the Brazilian pharma industry continues to be very resilient and Hypera has invested a lot in the past years to create the foundations for its medium and long term growth. We have a non replicable portfolio of brands and products. We have a unique innovation platform with a state of the art innovation center and the best structure of business development for the Brazilian pharma industry. We have marketing and plant facilities to support the growth expected for the company in the upcoming years. We went through process of an expedited rhythm in population aging in Brazil, and they will grow regardless of the growth levels, leading to a growing demand in drugs as the elderly consume four times more medicine than the young population. And this trend is proven by the past performance of the pharma industry that consistently grows above the GDP in times of recession or even in times of growth. The pharma industry is very relevant accounting for almost 50% of the market in Latin America and it's the second market that grows the most in the world with expected growth of more than 10%, growing more than emerging markets and developed countries. We have a nonreplicable portfolio of brands and products. We are present in all market segments in the Brazilian pharma industry, RX, OTC, dermocosmetics, generics and similar drugs, providing huge scale for the company and a portfolio that has been very important during the pandemic. Each one of these segments have a different dynamic and we're not excessively exposed in any of them. With the recent acquisitions and the divestments that were necessary to approve these acquisitions, we went from the fourth to the second position. With an expected growth for this year. Will pursue the leadership in the Brazilian pharma industry. We've consolidated our leadership in the OTC market achieving 20% of market share. We're the vice leader in the similars and generics market and we're the third in Rx. We currently have 18 power brands that account for over BRL 100,000,000 in the year, 11 being the leaders in their categories, accounting for almost 50% of the company's net revenues. Adelmari will go into further detail about our growth potential, line extensions with this and other company brands. In relation to innovation, five years ago we created Hainova, our innovation center that focus on product development to fill in the white spaces, the areas that already exist in Brazil and we don't operate in yet, an incremental innovation, be it new drugs or molecules that will offer differentials for patients and physicians. And since 2012, we're the founding partners of BioNovus with a share of 25% in a joint venture between four pharma companies in Brazil focused on the biosimilars market, which is looking for, in addition to transferring the technology in the biologics market, develop its own biosimilar products for the Brazilian market and the global market. We will hear some words from Odenir, who is the BioNova's CEO, and he'll address the novelty of the company. Our growing investments in R and D, achieving almost 9% of revenues already show results in 2020. In 2020, 33% of revenues came from products that were launched in the past five years. In 2016, that number was 24%. We know that the growth of the pharma industry comes from launches of new products. We currently have the largest drug plant in Latin America that can produce 18,000,000,000 pills. We will achieve 900,000,000 units in vitamins and over 300,000,000 in liquids and semisolids. From 2019 to 2021, we would have invested over 200,000,000.0 in CapEx, and we've already read the results of these investments in the increase production increase that will increase 44% from 2019 to 2021. Now I'm going to show you the video of our recent expansion in the creams and oils area that's been in operation since the beginning of the year. Every time I go to Annapolis, I'm just impressed with the size and the grandness of our plant. I know that some of you have been there, but I would like to invite you again to visit the plant after the situation is over. Come visit us and see for yourself all the grandness that we have there. In addition to the expansion of the solid area expansion that we've just shown, we've concluded the expansion of our VMS plant, vitamins, minerals and supplements. And the main projects now are building a new sterile plant and the expansion of our distribution center. In addition to the operations capacity, we have the most efficient medical calls team. We have approximately 1,000 reps in the field with the productivity that was doubled in the market average in the period after the pandemic. We are still adopting virtual tools in a hybrid medical call model where 20% of the calls are being made remotely, more than double than the average in the Brazilian market. Luis will go into further detail about what we're doing in that front in his presentation. In the past years, we've also invested increasing our direct coverage and points of sales. So now we achieve almost 80% of Brazilian drugstores, the biggest coverage in the market. With that, we have a direct relationship with most of our customers, understanding their needs and ensuring us that we have the best execution possible in those POSs. In Media, we're pursuing more efficiency of our investments and following market trends. Currently in Brazil and in The U. S, over 60% of entertainment time is spent on digital digital media going from 9% to 30% of the total of investment in media, which is spent in digital. With that, we were able to achieve our target audience in a more efficient manner and do campaigns for small brands that don't have scale to be shown in traditional media alone. Last year, we had the name rights for the Neo Kimica Arena. We've had good return, much higher than we expected, over seventeen hours of brand exposure on TV, not to mention spontaneous media in newspapers and magazines. We contracted dbop.com and the result was an exposure of approximately BRL50 million from September to December 2020, 10 times more than the amount invested in the period. But we have more expectations for that initiative than just the exposure of our brands. We see this as a big opportunity to tighten our relationships with our main stakeholders. Our purpose is to create loyalty of the 30,000,000 Korean Chan fans supporters that already know Neo Kimi Kai and have a close relationship with the brand starting off with HCPs, physicians, clerks and all consumers and patients in general. We want to learn more about the habits of the Corinthians team supporters, look into their habits, exploring opportunities for promotions and initially focusing on selling the Neo Chemica products. I've said a lot about Hypera's strengths. Now I'm going to call in Edson Tammasya, the founder of Remarkas and Febrarfar, the largest network of associations to give his testimonial about Hypera. Now talking about the growth drivers for Hypera for the next years. The main one is undoubtedly our pipeline of innovation. In addition to two fifty products that we launched in the past three years and that still didn't achieve their potential sales, we have three fifty projects in our pipeline with the potential to double the size of Hypera in the next five to ten years. And Odemario will give us more details of the pipeline in his presentation. Another important growth front is M and A. Acquisitions are part of Hypera's DNA, and we have great expertise in integrating the companies we acquire. Already see the results of the acquisitions conducted last year. The dermocosmetics portfolio acquired by Glenmark in April already shows a 25% growth in 4Q twenty twenty. And Buscopa, which was completed in September, also grew 14% in the fourth quarter, much above the pace it was growing at before. Those figures show the capacity of generating synergies not only for costs and taxes, but also sales for acquisitions that Hypera does. We're very confident with the initial results of Takeda and also with Simple Organic, a startup of organic dermocosmetics that we bought through our program of corporate venture capital, which Vivien will detail later. Our focus in this very short term is deleverage and integrate Takeda's portfolio. But we also see other opportunities for acquiring brand portfolios of multinational companies that concentrate their operations in their core businesses and divest OTC and primary care. And Hypera is the company that is best positioned to capture these opportunities. Another front of growth for Hypera is the institutional market. We've never operated in that market, but it's very relevant and is growing fast. It represents 40% of the total pharma market and shows growth rate of 15% with more and more participation of the private sector, an increase of the capacity in our plant for solids and sterile and the strategic products of this channel that will be detailed later. We want this channel to represent about 7% of our sales in the next three to five years. Lastly, and not less important, a great avenue of growth is the digital channel. Vivint and Luiz will detail later, but I would like to highlight our continuous investments in digital media, a hybrid medical promotion model that brings high productivity for the team and is the new reality in our relationship with physicians. Also investments in e commerce, this channel still accounts for two percent to 3% of sales, but it must show a fast growth as this share grows. And here, we're working on two fronts. First, investing in omnichannel platforms of our customers. We created a trade marketing team dedicated for this channel and also our own B2C platform that already had more than 15,000 orders since it was launched in April. Another very promising front is our omnichannel B2B for sales and relationship with the independent retail. Today, we cater to about 80% of the pharmacies, but we can reach the other 20% in a very profitable and easy manner using technology. And lastly, Hypera Hub and Hypera Ventures that works with startups to make the company more effective. And Hypera Ventures for investments in startups that work in the health care and wellness market. In addition to investments in innovation, production capacity, go to market strategies and digital. Hypera has been investing greatly in corporate governance and the wellness of our employees and the communities that we are in. We reiterated our ethics and compliance program with a 100% independent structure that reports to me and to the auditing committee. We the top management is fully engaged. We structured a corporate risk management team that checks the company's operational and risks, and we created policies and procedures according to the best practices in the market with the code of ethics, donation policy, relationship with authorities and others. We communicate and train our leadership, our employees and suppliers. Our motto is do the right thing always goes well. Hypera is also very active in social actions and initiatives that help our employees and the community we are in. In 2020, we donated more than 480,000 medicines. We also work with Ores Da Vida, which provides clinic medical consultation for low income people. Also, Hypera's volunteering program impacted 17,000 people, partnering with 25 NGOs and other benefited health institutions. About COVID-nineteen, we did everything we could to preserve the lives of our employees. We tested 100 of our employees. We implemented a procedure to test and give leave to those of that are affected. We established telemedicine services for all our employees and had more than 30,000 online appointments during this period. We also concentrated our donation in the state of Goias and the city of Annapolis. We donated to local NGOs. We donated ventilators, PCR tests, and intensive care unit beds to help the cities when they needed it the most. It was a total of 30,000 BRLs to help with the well-being of our stakeholders and employees. We also have several programs focusing on the environment in several fronts like reuse of water, environmental biodiversity, control of waste, recycling and others. The company also has a program to educate our employees and stakeholders about wellness, sustainable life and the importance of initiatives to preserve the environment, like Plantar and Faliverc. For the past years, our programs brought relevant results and we used reused 1,800,000 liters of water. We reduced our solid waste by 44% produced in 2020. We also have two large projects to increase even more the reuse of water in our operations and reduce emissions of CO2. We invested in new technology to increase the reuse by 2.5 times by the 2021. And we're also building a new energy substation with investments of BRL25 million that will eliminate the need of using generators and consequently is emitting CO2 in about 10% by the 2020. In March, we announced a project to recover the Araguaia River, the main river in the state of Goias and very important for the Midwest Of Brazil. This is the largest recovery project in the world, reforesting 10,000 hectares. We're very proud to be helping the state of Goias in this very important project. It's also important to mention that Hypera has many a lot of diversity for the past year, especially during the pandemic. That's the result of the work of the leadership team and all our employees. I would like to thank the work and effort and dedication of our 9,000 employees that made Hypera reach the point where it is. Innovation and creativity are encouraged in an environment that values diversity. And here at Hypera, this was a natural thing. The data we're showing today reflect that. 50% of our employees and 35% of our executive officers and 22% of our Board of Directors are women. A very number that is much higher than the average of Brazil, emerging markets and healthcare. We didn't establish a target for the company, but these numbers reflect well how the company sees the importance of diversity. Surprising, my key messages for today were Recent performance of Hypera shows strong recovery, although we do face a challenging scenario of the pandemic. We still believe in the pharmaceutical market opportunities for the mid and long term. We have relevant competitive advantages compared to our main competitors. We are still investing in new growth drivers for the company and we seek sustainable growth considering the well-being of our employees and the communities we have relationship with. I would like to thank your attention, and I'll come back at the end. Now I would like to call Caio, and I'll see you later. How many great things Hypera is investing where they need to grow in a sustainable manner in such a resilient market. As a pharma company, Hypera has to look at the well-being of their stakeholders and contribute to a more sustainable world. Great, Bruno. And those who are watching, do you have any questions? Send them to us. Just point your phone to the QR code or send your question that they will be answered at the end of our meeting. And as Bruno said, investing in the product portfolio is necessary for sustainable growth. And that's exactly what the company did in 2020. Even with the challenges that they faced because of the pandemic, last year, more than BRL350 million were invested in P and D and innovation. Also, Hypera recently concluded the acquisition of several brands of Takeda and Glenmark and also Buscopan, the second largest OTC brand in Brazil. The pipeline of innovation of Hypera is still very robust with many launchings to care for the health of Brazilians like vitamins, prescription drugs, generics, dermocosmetics. Guys, innovation is part of Hypera's DNA, as you can And to speak more about that, I would like to invite Adaomari, our CFO and Head of Innovation and New Businesses, to give an overview of everything that Ipera is doing. Adaomario, you have the floor. Good afternoon. Good afternoon, everyone. Everyone who is with us at our Hype Day, we want to share with you what we are doing with our pipeline for new products and show in detail why we believe that innovate is essential for Hypeera's business. For us, innovating is not just having ideas of new products, but also developing the culture of innovation in the company overall, with people who have the skills of creating, launching, escalate new products in an agile and assertive manner. Innovation is the key pillar of our growth strategy for the mid and long term. But even more important are the results that innovation brings in the short term. So I'm going to start my presentation speaking of the results that we achieved for the past three years since Hypera became a 100% focus in the pharma industry and the positive correlation between launching and the company's financial performance. During this time, we did more than two fifty launching in the past three years, concentrated on extending our lines of the key brands that we have in our portfolio like Benigippi and Maracocina. We also were able to create brands and enter new categories launching Luni, Iprey, EZ, Atrofan and Atrotop. We increased the coverage in the generics market, including new relevant molecules in vitamins and supplements. It's the category that we have the highest innovation rate in the company with accounting for more than 60% of the revenues coming from products recently launched. And we also launched unique ingredients like Vita Sao Vitale, the success of MSN with our collagen complex brand and recently coflex muscle with HME ingredient. The dermatology products pull our company upwards with more than 60% of the products launched in the past years and increasing our portfolio of epiglatch launching vitamin C nano capsules with great relevance in nano drugs. In addition to launching new products that help the organic growth, we also have M and A as an important part of our innovation strategy. M and A is at Hypera's DNA. In addition to the synergies, they speed up the launching with the purchase of icon brands that are synonyms of the category and very difficult to replicate like Buscopan and Nosaldina and also allows us to go into very appealing segments that grow above market like diabetes and dermal drugs. These two strategies together have the potential to turn Hypera into the leader in the Brazilian pharma market. Very in the Incredible, isn't it? You can see the number of power brands not to mention the ones that are about to become power brands with revenues close to 100 Now looking at all these launches, what were their impacts to the company's earnings and growth? Just to understand the order of magnitude, last year, the company's growth was 24%. Half of that growth came from products launched in the past five years. Even though they account for onethree of the revenues, we were able to achieve one of the highest levels of innovation in the industry, close to the goal that we posted at the 2017 of having close to a rate of 25%. From then until today, we've expedited the launch of new products. And in this three year period, the launches account for 25% of the company's revenues. With that, it's very clear why innovation is so important to Hypera. Now I'll go into further detail about the innovation process at Hypera and what we have in the current pipeline. Everything starts off with the most important asset that we have in the company, our human resources, people. Innovation doesn't happen without their participation. We had the privilege of counting on the best teams of multidisciplinary professionals with the mission of bringing in innovation to improve resilient health. We have a team of over 20 people focused on strategy and building the ideal portfolio for Hypira in the next five to ten years. That is the time horizon that we are working on, focused on identifying the possibilities, opportunities that will bring us the biggest return for the pipeline in the medium and long term. In addition, we have a technical committee comprised of P and D, medical, regulatory, plans and procurement, analyzing the feasibility of each project, see if we have the know how necessary and the ability to develop in house or externally through acquisitions or even joint ventures to join forces with other companies that can add on knowledge as we did with BioNovus. The strategy and innovation teams analyze the market with different databases, surveys with physicians, patients and consumers and with that trying to identify the main trends that should impact the healthcare industry. Here we have some of them that act as the foundation to build our pipeline. The most important is having consumers and patients at the core of decision making. Today, we live in an era of empowerment and engagement and consumers demand more transparency, convenience, and access to customized products, which is even more relevant today in understanding that complete journey and all the different consumers that we have. That's the main challenge we face. This consumer that's more informed and connected and has much more access to specialists than before. And without leaving their home by using telemedicine for consultations with access to electronic prescriptions and buying on e commerce platforms of the drug source. That consumer that's engaged digit and digital also focuses more on prevention and wellness than treatment. They want to improve their immunity so they don't have to be you have sick days, and that's why they're more concerned about their diet with a balanced diet and increasing the demand for vitamins and supplements. And that should continue to be a trend even after the pandemic. These consumers are also concerned with the source of products and where each ingredient is coming from preferring natural plant ingredients and free from preservatives and if possible, organic as well. The other important aspect is that these consumers are living longer. The average expectancy is seventy six years in Brazil and is going up year after year, which is excellent. However, the improvement of physical health happens with together with the worsening of mental health, which is related to change in lifestyle habits, the increase in neurological diseases such as Alzheimer's, Parkinson's, depression, anxiety, and insomnia. Those should be the main causes of diseases in the future along with diabetes, obesity, and hypertension. We have our eyes open for the trends and are looking to have a pipeline that will address these systems to help people live longer and better with quality of life. Now about the numbers of our pipeline. Even through in the through a challenging year of the pandemic, we launched almost 90 products last year in addition to approved 47 new projects. With that, we've ended the year with 350 projects in the pipeline and have the potential to double the company's size. Another important indicator that we have in the pipeline is the level of innovation in these projects. In this innovation matrix, we can see that better. In the horizontal axis, we have the level of innovation per product. In vertical axis, we show where we can innovate. So the traditional innovation model suggests a division of seventy-twenty-ten in products close to the core business, adjacent and disruptive or transformational. In our case, almost half of the pipeline is closer to the business and the other half is adjacent and disruptive projects. When we compare that to other global pharma industries or biotech companies, the disruptive option is higher. But compared to local companies, the pipeline is mainly focused on projects that are close to their core business. The ones that are closer to our core are projects that increase our coverage in generics and patented molecules where we have an opportunity of being one of the first to launch after the patent period is over. In adjacent, we have knee better products, which are line extensions, new brands that set us aside or set us apart from the competition such as a painkiller with a double potency or in a stick format, on the go format that provides additional convenience for customers. The rest of the world are concepts, molecules and categories that don't exist in Brazil. However, they are present in other countries. Here we have less projects However, they are innovative with a huge potential for the Brazilian market. With this type of pipeline profile, it's very clear that our commitment in bringing in more innovation and changing the status quo of the Brazilian pharma industry, make maintaining a balanced focus on tackling the opportunities that are close to our current business that we can launch in the short term as well as setting ourselves apart by anticipating the trends that we're seeing in other countries. Now I'll show you the division of the pipeline into product categories. Expanding our brand portfolio, which accounts for almost 80% of the product line and increasing the relevance of generics that currently accounts for less than 15% of our revenues. We have a specific strategy for each one of these categories. First, about Rx that are promoted by physicians. In our Rx business line, the main strategy is to increase our share in chronic treatments and bring in more exclusive treatments for physicians. Although the current portfolio is more relevant in acute treatment, when we see the pipeline, we have a higher share in chronic therapies such as CNS, cardiovascular and women's health. Here I have two examples to show you exclusive treatments that we have with a high level of differentiation that we're offering physicians. The first one is the extension of the Elektus brand which was recently acquired. The molecule has an exclusive patent up to 2027. It's a second generation antihistaminic and oral solution indicated for treating allergies in children six years and above, which was already being developed when we acquired the Takeda portfolio. The second one is our new brand, Amomi, the first nasal spray promoted to physicians after the reference product of Nasonex. It's the strength of our medical promotion team in these specialties who were able to gain great market share. When we look at the five main Rx products in the pipeline, they have a contribution of BRL500 million to the total pipeline. Pipeline with the diversity of treatments that go through insomnia, nausea, ADHD, gynecology, and cardiovascular. When we go into OTC and OGX, the strategy is brand extensions of the leading brands and also bet in new categories in Brazil. The first example that I have is the BlueMell line, which is the first specialist brand in treating children's flus and colds with a complete solution efficacy and natural ingredients without sugar or preservatives. Here we were inspired by Zorbees abroad. We were a pioneer to launch the probiotic LGG in capsules and sticks through a partnership with Fish and Hand. This is the strain that's most recognized around the world in most clinical trials to relieve diarrhea, improve bowel flora, and improve immunity. We're confident that we'll be the leader in this probiotics category, and LGG will be our The launches in this category are $370,000,000 are mainly focused in pain. When we move on to the generic portfolio, the main strategy is to increase the coverage of molecules and be the first to launch products after the patent So we identified the molecules that will lose exclusivity and they are already in development in our pipeline. We estimate that we will obtain 15% to 20% of share for these molecules. Here are some of the recent launches with a highlight to sublingual sulfate. And we have 17 more launches this year and will increase our launch for the market to above 55%. The top five products in the pipeline will contribute with EUR 185,000,000 in revenues after the launch. In the category of vitamins and supplements, we'll continue to invest to differentiate and expand the brand portfolio with new ingredients and pharmaceutical formulas that will offer benefits to consumers. This is our recent vitamin brand, Neo Kinica, with a full offering for consumers, with the highlights of the epinescent formula of vitamin C plus zinc to increase immunity. Another example is the Adara OTX line with a wide range of products and formulations always associated to vitamin t with the highlight to the first vitamin d in a format of these projects contribute with $150,000,000 increment to our pipeline. But in this category, it's more dynamic and enables us to speed up the investments in the short term. In dermatology, we have the strategy of differentiation and positioning skincare line with unique formulations betting on natural products and expanding our offer of dermal medicine. Now I'd like to share an institutional video of Manticore Skincare. The top five products that we have in the dermal pipeline total EUR120 million in contribution and reinforce the portfolio of sunscreen, hair and rigid vision. So lastly we have the injectables pipeline that will increment the institutional channel which is being developed in collaboration with some strategic partners mainly focused on antibiotics and hORP. We already have 28 molecules in the pipeline with the potential of generating three thirty million in sales. I'll let Luis talk about that in his presentation. In the institutional market, we also have the participation of BioNovus. There are biotechnology arms that already count on revenues close to 2,000,000,000 almost doubling in size year over year. To talk about BioNovus, we have Jeanine Finochtiz, the person behind BioNovus. Let's check out his video. I would like to thank for the opportunity to share the innovation initiatives and the skill of Hypera depends on our ability to continue to innovate. And our mission is very clear. We have to continue with this path towards success. We believe that there's much to do and we're only at the beginning. And now I would like to pass the floor to Caio, and later I'll come back in the Q and A session. Thank you very much. With so many incredible lodgings and robust investments in innovation, you're going to rock at Dalmaru. But it's not just innovation that Ipera is investing in. As Ben mentioned, Hypera is advancing in several topics related to digital transformation. The company now has a robust platform for remote medical appointments that gain visibility during the pandemic and increase the number of medical appointments. Hypera launched its platform in 2020 to sell directly to the end consumer and create an exclusive trademark in digital trademarking team. Hypera also intensified their investments in generics. And Nelchemico with the name right of Corinthus Arena, now called Nelchemico Arena. And speaking of generics, Saipara is looking very carefully at a company and it must be a new growth driver for the company. To talk more about that, I would like to call Luis Clavez, Marketing Vice President and Sales that is spearheading these initiatives at Hypera. You have the floor. Thank you, Caio. Thank you for talking about the drivers. We have many important drivers for growth, and we're going to talk about that next. Good afternoon, everyone. It's a pleasure to be here with you and talk about very interesting things that Hypera is doing for the past years to create new growth drivers for the whole organization. And speaking of that, we go back to the consumer. The consumer is our center of attention, be it a shopper when they go to the store or patient when they go to the physician. They're evolving through the years and they were highly influenced by the way they received information. It was very simple in the past. It was on TV or print media. And with the evolution of the Internet with Google, with smartphones, this consumer now receives information from all over. And their behavior changed throughout the years, changed very relevantly. And we obviously had to understand how the consumer behavior changed and we have to open new pathways considering this consumer. And this new consumer, as you can see here, is the center of our attention. They started to behave differently, as I mentioned, And we had to open new pathways and look for new alternatives to reach this consumer in appealing and effective and interesting manner. And these new drivers, these new pathways that Caio mentioned is what I'm going talk about. We brought them to the business recently, and they're very promising for the future. The first one are the new connections. The digital consumer, multi faced consumer, as we like to say. This consumer has changed. And if they change, I have to change the way we do business and how to reach them. So we basically had 90% of our investments in offline media, especially TV in the past. In 2021, we're gonna have 35% of our investments in digital media. But it's not just changing investment to digital media, just putting money there. You have to prepare for that. And how do you do that? The first step is to work content so that the consumer that interacts with our brands has relevant content for them to read so that you attract, retain, and engage, and convert into results. We work on five blocks, vitamins and supplements, dermocosmetics, anti flu medicine, prevention, and GI so that you can increase the number of interactions with our brands. The intention to buy an interest. We left from less than 2,000,000 to 2,500,000 of interactions with our brands, evolving and delivering high quality content for the consumer to feel attracted and have important relevant information from our brands. And that's not all. We need content, but we also have to talk to this consumer in a dynamic manner. And that comes from social media. And with two brands that we had on social media, we have 20 now. We created a social media management department inside our agency, and they're working with these 20 brands that I mentioned, and they retrofit the system. And we basically created a digital creation hub with social media and with information that comes through the content that is generated. And then you can reach these results that you can see on the screen. So 400 time of content published, growth in audience, in views, in interaction, so that you can generate results. And I would like to show a first video that shows all this that we did to give you an idea of what is going on. Okay? With all that that you've seen, with all those changes and being prepared to actually talk to the consumer and be relevant in digital, we've seen a change in business. 36% increase of investment that we did in the 2020, we were able to achieve 17% increase in the demand on the brands that had digital investment with 70% return. What I have at demand compared to what I invested. The scenario is promising and the more the better we can be in this scenario, the better the results for the company. Now going back to the consumer, the drivers are still coming forth. Very important one that complements digital media is e commerce. Online consumption of our products, which had a very relevant growth in 2020. With the pandemic, a lot of people had to stay at home, many stores had to reinvent themselves and work online. The truck stores are still open, but e commerce gained relevance because consumers were at home. In 2020, it was 2% of the business. It was 1.5. It was an impressive growth. And we have to adapt, creating our own platform, which is called eHypera that was launched in April, May and creating a department to manage e commerce with our partners. We call eTrace. Our iHypera is SerMA and vitamins and supplements and now will be added to the other products and E TRADE. The same person who sells to retail is the same person that has to know what we did in ecommerce, which didn't happen the best way. And since the beginning of the year, we have a dedicated team that thinks full time on everything we do with the customer's e commerce. So this these two pillars, we try to engage consumers to our brands. And we were able to basically develop Hypera. We had 2,500,000 people that went to our institutional e commerce. We also partnered with marketplaces. We work with more than 10 of them. We have a partnership with large companies in which we supply our products as a benefit for the company to offer their employees. We work investing in media for conversion to our brands and our own website. We created a database for the consumers, so we prepared this ecosystem to be able to generate conversion at the end. And along with that, with the our clients, we have a dedicated structure, pure players, which are companies that we didn't work with before that are fully e commerce like Advoca Cosmetics or Belize de Nove, Pharma Delivery that works with drugs. They're digital marketing companies. So we made this partnership, and we were able to grow 80% with our E Trade, 72,000,000 sellout, which is basically what we didn't capture before. So it's very relevant, and this combination of doing ourselves and also boost the business of our partners and retrofit the ecosystem with the marketplace and social media creates a very interesting environment with a lot of potential for our business. And today, we're the fourth player among the pharmaceutical companies. We worked last year strongly with dermocosmetics. We've been increasing vitamins, shares, so we expect to become the second player this year. And by 2023, we want to be the first player in the market. Working not only dermocosmetics, but also vitamins, supplements, prevention, and chronic use drugs with continuous replacement. So if you use a drug continuously, you can schedule that replenishing through e commerce. So we're doing everything we can to be the leader in this market as we are in retail. So little by little, we create these drivers, these pathways. It's still an ongoing project, but they're very promising. And we still have another moment of consumption that Hypera wasn't capturing so much. And what is that? It's already established, but Hypera wasn't into it. It's the institutional channel. We're talking about hospitals, clinics, HMOs. So you feed that institutional market that can be either private sector or public sector. The public sector with the government are bids for large contracts. You have a relevant number of lives of patients that are being cared for, but it's more basic care, it's more essential care for survival. But the largest market is the private market of large institutions with specialized treatment with a very large number of lives, and it's the market that is growing the most. Hipera today is basically public sector. We enter bids. It's 70% the public sector. It's one third of the pharma company. It's already big. It's growing very interestingly, and we should participate in that. So that's another driver of growth that we created in the past year. So we did two initiatives. One, a portfolio. But to be in this institutional market, you need to understand what the market needs, what you have to offer. So injectable that goes towards what we have in the new plant that will be ready by 2023, injectables, and chronic use diseases very specifically. So respiratory products, cardiovascular disease, central nervous system. So we map 28 molecules that are being used in this market in the injectable form, and they will be plugged in our portfolio through the next five years through partnerships of existing molecules, new businesses of molecules that are not here yet and products that we are going to develop ourselves. So that will increase our portfolio with 28 new molecules in five years. Along with that, you need a structure. So we created a structure that catered to the public sector, which will now cater to the private sector. It needs not only distribution, but it also needs to register our products, especially in their hospitals. So you have to have a standardization. And another team will sell to the public sector, but also coordinate the bidding process. So the combination of portfolio and structure brought us to a new scenario in institutional sales. And it's 1.7% of Hypera's revenues, but it will grow 35% in the next five years. Well, we expect to account for 5% to 7% of Hypera. It's relatively small with investment in technology and structure to operate, and we hope to account for 5% to 7% with relevant growth compared to what we want to deliver in retail. So it's a very good drive for growth that we just built. Now going back to digitalization, we can also talk about medicine has been behaving. We're calling it digitalization of medicine. We took the first step and to show that. I'll go back to what happened in 2020. We started the year basically in the analog model, visiting the physicians face to face. We had a very small project of virtual visits. And when March, April and May when the pandemic hit last year, not that it wasn't. It isn't concerning that now. But last year, everything stopped, and we had to bring our teams home to understand what we were gonna do. We prepared very quickly. So when we gave vacation to the team in April, we rolled out the tool that we already used. It's called Kedridge. It started to operate on our entire sales force and also the conferences, trade shows in a digital manner. So we migrated massively to the digital world. Did that between April and May. And as of the third Q last year, we operated in a hybrid model. So we went back to visiting the physicians face to face and remotely and also putting all these other things to operate. Especially at the beginning of the third quarter. We increased productivity. We were able to visit more before the pandemic, and we were able to be leaders of digital visits. We're the company that does the most digital visits in the market. We believe in this market and it brought great results at the end of the year. We increased the number of visits, we increased the number of physicians, we increased the numbers of prescriptions. So the result, as you can see, the chart on the bottom, there was a certain moment that we almost had to stop everything. We had almost six visits. The market almost went to zero. And as we were able to implement the tool in the hybrid model, we recovered. And at the end of the year, we were able to work with 15 visits per day in the market, better than the 13 we did before and better than the seven, which is the market average. So we evolved greatly, thanks to this model that we believed in. And we know that it's here to stay. Of those 15 visits, three are digital. So you have fewer face to face visit, but the total is higher because you do remote visits. And you have these results that you can see. We visit 160,000 physicians, which almost 40,000 more physicians, 15% more interactions, more prescriptions than this year, 6.6% in a year in which the prescriptions dropped. So this mix worked very well. And this brought us very good results in the last quarter and very promising at the beginning of the year. But the model doesn't stop there. It was basically analog and it started being hybrid and digital and analog, but it's much more of an evolution. It's almost an omnichannel. And when the physician prescribes through telemedicine with telemedicine, you how you convert it to the store, how you retrofit the information for the physician, how you talk about innovation. So you can do several alternatives. We believe in that. We've been working with that in the project that we're doing in house to increase the number of contacts, of interactions with physicians, with patients and retrofit the ecosystem in a very robust manner. So we believe that we're just starting, but the results are very promising as well. And based on all of that, you have all that experience, all the avenues that we're going to grow. And then what's another way of feeding back into all that chain in a very impactful manner? That's where we have the Neokimika arena. We use the platform with our main brand, with our brand of generic and similars, carries the most number of items. And it's our big brand and has revenue revenues of possibly 2,000,000,000 in distribution in all drugstores in Brazil. A lot of growth because the similars on generics market is growing a lot, and nothing better than bringing together a platform that talks about health, sports and wellness to consumers. So nothing better than the Neo Kimica Arena as the Corinthians team. They have a strong job in loyalty, so a proactive and ends the wellness of consumers. So since August until the end of the year, in the past four months, September through December, in quantified revenues according to average market value in spontaneous media, BRL49 million. So spontaneous media that comes from many different places, the name Averina is being used in general by the media. And in addition to the media that we already do, it's very relevant. So to show a bit about all of that that I just shown, I'd like to show you this video. Scene to crown all of that, we have the ambassador of the neo Kimika arena, Martha. And she's on her path. She comes from a very humble family. She was able to show her talent and her talent here in Brazil to the entire world. She's a she's a great person to endorse this platform, and it'll be great to have her close to us across 2021. But as I mentioned, the Arena is the big platform, but it will feed back into our entire chain. Our chain has the access channels on the right with ecommerce, social media, many and different portals and tools that interact with consumers such as WhatsApp about how you interact and engage. But above all, it has our stakeholders at the core. So here we're talking about physicians, consumers, sales team, fans and consumers, retailers. So at the end of the day, we want to use this entire ecosystem to feed back into this platform that relates to consumers, to our end users, create this platform and Neo Kimica Arena feeds back into that, the energy, the speed and gives it the dynamism so that we have a great center of information to be able to interact with these consumers, generate interaction, content and conversion. That's what we want at the end of the day. And the Yo Kimica Arena is boosting that process. As I mentioned, the consumers are always at the core, and that makes these avenues stronger. They're creating new ways to interact with consumers, new options, new tools, new channels, new processes so that we can always create more interaction, generating content ahead of time so that we can continue to generate growth. But I can't forget to mention the points of sale because then you're gonna think, well, you talked about digital, ecommerce platform, the arena hospitals, digitization of medicine. But what about the stores? Yes. Of course. Our business still happens at the point of sale. It's the main source of consumption of our products. I can't forget it, but it is part of that chain. And that's another story. I'll let Vivian talk about that. She'll come back to this when she gives her presentation. So thank you. Excellent to be here with you in this period. We'll be back later to answer the questions during the Q and A session. Thank you. Clavis, that was great, so many avenues for growth and taking health to the Brazilian population in a more relevant manner in the hospital market with a lot of investment in technology and using sports to promote such a strong brand like Neokinika isn't easy. So Hype here is investing a lot. Are we done yet? No, we still have a lot at Hype Day. If you have any questions, please send them. You can scan the QR code on the screen or send your question by clicking on the tab that you can see on the screen. The last HypeDay, Hypera already talked about its digital strategy and its importance to solve the short term problems by using technology and by pursuing disruptive opportunities in the medium and long term. 2020 was a year to capture the first results and to consolidate the culture of innovation company by implementing unique projects in the Brazilian pharma industry. Now I'd like to invite Vivian Angeliucci, the Executive Director of Strategic Projects to talk a little bit more about this to all of us. Thank you, Caio, for the introduction. Good afternoon, everyone. It's a pleasure to be here again and talk about our digital strategy. I'd like to start this afternoon reminding you about what we talked about last year of our digital strategy, which is based on three major pillars. The first one aims at leveraging technology to bring in efficiency and efficacy for our operation. The second is to place the customer at the core of our decision making and expanding the markets where we act. Third is to be play a star role in the disruption of the hospital market. In the last Hype Day, we launched our open innovation program, the Hypera Hub. It included four point zero industry projects, HR four point zero, data analytics and new technologies. There were 10 challenges and for those challenges we had two zero three startups registered, 40 of them were picked for the pitch day, 12 were approved to pilot their solutions and at the end five were contracted with a significant impact for Hypera and its business partners. Now let's talk about some of them and their results. The first of them, V Goal, had the purpose of increasing Hypera's market share in small retailers by offering customized order suggestions. It was a success. We had an additional growth in points of sales that were exposed to this of over 5% and the startup is in the phase of rolling out its solutions. The second startup called Nucleometro had the purpose of accelerating our research and development projects in skincare. They brought in artificial skin projects. Before to have access to that technology, we had to have access to international partners that affected time and cost. And lastly, we have Databot with two main objectives. First of all, to bring in automation in our cold system project and artificial intelligence into the production system, improving the agility and decision making. All of these startups are already hired and they're rolling out their solutions. It's also important to mention that in addition to Hypera Hub, we became very active in our startup ecosystem. We currently work with many of them to solve business problems in an agile and efficient manner. These initiatives go from artificial intelligence to process optimization as well as including partnerships and business models. Now I'd like to bring on a video about Hypera Hub to tell you about the first year of our open innovation program. Just said, we're launching Hypera Hub phase two. More challenges, more engagement with the ecosystem and more impact for Hypera and its business partners. The challenges are already on our website and the pains are related to data analytics, industry four point zero sustainability and marketing and sales streamlining processes. Now let's go into our second pillar. Luis mentioned before about some of the initiatives that place customers at core of decision making such as e commerce and multichannel relationship with physicians. Now let's focus on the Hypera partner platform, which is the new way to interact with retailers. Behind this project is the purpose of enabling small retailers to prosper and grow and considering the social role for all of Brazil. We want to be present where and when retail wants us with the customization of our offerings. So we want to increase our sales together with retail development. I mentioned that we want to offer customized offers for customers. What does that mean? It means we need to understand what our customers want. And it's worth mentioning that this entire project was built based on the deep understanding of all these needs. To illustrate that, I'd like to share two profiles that we found when talking to small retailers. On one side, we have Fernando. Fernando, he owns a mid sized point of sale. He is known for everything having everything customers want. He likes to be close to the customers and he also likes to be close with the industry representative. He does not like virtual relationships. He does not like to buy online. He's very much concerned with quality and service level than price. On the other hand, we have Roberta. Roberta doesn't really wanna talk. She wants efficiency. She likes to buy independently and remotely. She's very rational. And purchasing, she swaps around a lot before buying. So you can really see the difference between these two profiles. So right now, what are we doing? At what point are we in this platform? We started to test the e commerce platform since the middle of last year. It's already online and the objective is to improve user experience by meeting all their needs. And the next step, we want to deliver much more than a shopping platform. We want a more robust relationship platform, customizing offers and incentive program that should happen in the first half of the In the second half, we want to evolve that delivery to the marketplace, delivering more than products to our customers. By March, our e commerce already counted on 8% of our active customer base, over 10,000,000 in revenues and above. Active customers have already shown superior growth to the rest of our customer base. Let's take a look at our e commerce now. Companies that already have proven business models. But before they go into speeding up their growth, regardless of shareholder shares, we want to make them independent so we can level main assets in hypera such as r and d and so on. In 2020, we had over 100 companies that were evaluated, over 10 business partners that already that are already in effect. One investment made three term sheets that were signed and in the due diligence process in addition to a robust pipeline for 2021. This is the rationale behind our first investment, Simple Organic. It's worth noting that the derma cosmetics market in itself is already big and resilient. The natural organic and vegan products market has been growing in an important manner outside the derma cosmetics market. On the other hand, Simple was already a leading brand in its segment with a robust profile with a large ability to innovate with the founder with complementary abilities to ours and to add with their many synergies that can be be it target audience, market or channel. So it's a huge pleasure that I'm going to hand over to Patrice Lima, the founder of Simple Organic, who will say a few more words about this partnership. Thank you, Patrice. It's a pleasure to have you with the Hibera team. To close my participation, I would like to share our expectations for 2021. With Hypera Hub, our goal is to speed up results and generate new opportunities. With the multichannel, we want to increase the share and new revenue streams. And with Hypera Ventures, we want to speed our organic growth and have new strategic I would like to thank you for your time, and I would like to pass the floor back to Caio. Good afternoon. Great to hear you, Vivien. I was checking Cipa Organics website, and I found a whole bunch of interesting things. There's a great tip for you who are listening to us from home. Those who are watching Hives Day will get exclusive discounts to buy products at Simple, Organic and Hypera. Isn't that great? So let's talk about that later during the Q and A. Now pay attention all the way to the end of the event. Hypera is the most prepared company to capture the several opportunities of the pharma market in Brazil and is investing heavily. This is more similar to my field. Hyper is like a soccer team that wins championships but doesn't sit on its hands. They strengthen their teams, be it at the goal, the defense, offense. A Hypera is always plays a leading role and plays to win in the Brazilian pharma market, innovation, digital, new markets. What can we expect from this team in this year and the ones to come? To answer that question, Bruno is here back with us. Bruno, tell us about it. Where do you want to go? Where are you leading us? Great, Caio. You heard in detail our strategy for innovation, our initiatives in digital, all the opportunities for growth that we have ahead of us. With all these initiatives, I would like to show you our strategic goals for the next three years. In terms of growth, with all these initiatives, we want to grow significantly above the market, leveraging our launchings in the next years, our innovation pipeline, new distribution channels and new opportunities of strategic acquisitions. In addition to growth, we want to increase the company's profitability. For the past years, for many years, due to the several issues, we're back in profitability levels, especially optimizing expenses and cost. We have room to recover the EBITDA levels of 30% to 35% that we had in the past. We also want to continue to generate cash strongly to invest in our business in all these opportunities for growth that we mentioned here and also focusing on reducing indebtedness in the short term and increasing the shareholders' profitability. We want to deliver better results for our shareholders and stakeholders. As we said in our last earnings call, these are our guidances for 2021 in line with our midterm objectives. Net revenue of about 5,900 million, adjusted EBITDA excluding the lines of other expenses and revenues of BRL 2,000,000 and net income from continuing operations of BRL 505,500.00000. This is what I had to say. I would like to thank you all for being with us, and I hope you were able to convey all the opportunities that we see for Hypera in the next years. Now, Caio, you can continue with our event. Thank you, Bruno. Now we are going to answer your questions as much as possible, all the answers that you sent from home. We're going to start our Q and A. We're going to have a short break, three minutes for you to grab some coffee, stretch, and we'll come back with all our executives. Before that, before we start our Q and A, I would like to remind you that using the discount coupons with HYPEDAY2021 code, you can buy products with 30% discount, both at Simple Organic's website as in ihypera.com.br. Three minutes and we'll be back to answer all your questions. So we're back. I think you all had time to grab some coffee, to stretch. And now let's go back to our Q and A, which is the last part. I would like to thank for your questions. We'll try to answer as many as possible so that we can have a great hype day. Speaking of that, our studio is set up respecting all the safety protocols. We have divisions. All the executives, including myself, who will be part of the Q and A, were tested, and all the tests came back negative. So we all are in great health. A last reminder before we call everyone to the stage. Those who are watching us, use the coupon with the hashtag hype day twenty twenty way One, with this coupon, you'll have 30% discount at simple organic and hypera.com.br. So in addition to this great interaction with you, and I hope you all are enjoying, use our coupon and you'll get 30% discount on those websites. I'm going to take my seat here and call our executives, Adaomario, who will sit to my left, Vivian, who will sit next to Adaomario, Brenu on my right side, and Clavis to also conclude our panel. I'm going to read those questions so we can answer all the your questions. I'm going to start with you, Adaomario. The question is from Sergio Oba from Empiricus. He wants to know, can you update on the growth of the vitamin segment? Is it still speeding up? Yes, it's very fast. We had a growth in 2020 that was very relevant, almost twofold in some categories. January and February, we saw not exactly the same growth that we had last year, but it's still with very high demand. For us, there are two main effects. Some vitamin categories have a higher demand, and one of them is the one that we're leaders, vitamin D. January and February had a growth of 80% for that specific And the others are the launches that we have in other categories. So with this, we can grow above the market, launching new products of the brands recently launched like Pitasai, Nalchimica and the line extensions, increasing our share of the market. So that brought me some memories like Pelez commercial. The second question is from Jojo Dunu from JPMorgan. For you, Clavis, in the institutional market, can you leverage the portfolio that already exists in retail in that channel? How much more complex is developing injectable products compared to solids? And how do you compare the margin of that channel compared to retail? So it's actually three questions in one. Okay. Let's go part by part. The existing portfolio is for the institutional channel. It's for basic care. We did develop this portfolio because we didn't have available capacity to make products available to retail and also for the institutional channel. Now with all the investment in the plant that we've been doing, we're capable of absorbing the demand from these two channels, and we can develop this basic portfolio and take it to private and public institutional channels. As to the injectables, what happens is that there is a level of complex city, but you have to invest in technology. You need the platform. And to have the platform, we also need to get ready. We're building a new plant of injectables and steriles that will be ready by 2023. And we're going to look for technology available through partnerships that will allow us to use the volumes, registers and volumes with this partnership. And when we have the plant ready, we will bring that technology in house. So there's a lot of potential ahead of us. We're ready to do that, and those pathways are very interesting. About the contribution and profitability of the institutional channel to the company, I will let Bruno answer. The margin is very similar to what we have per category. So comparing generics in retail and generics in the institutional channel, the margins are very similar. So we see that as an opportunity to grow our company's revenue, maintaining the margin for the company. So it's like Luis said, we have now greater capacity. So it's a way for us to grow the company maintaining the margins for Hypera. We have another question for you, Adelmato. It's from Bobby Ford from Bank of America. What are the opportunities with the with the end of patents that Hypera will get? And how are you getting ready to take advantage of this moment? Great. We have a strategy that started four or five years ago when we became 100% pharmaceutical to focus greatly our innovation pipeline, both in innovative products as well as extension lines from our brands and also getting ready for future end of patents, which is very relevant, especially looking at 2022 to 2029, we have the end of patents in some categories like diabetes, cardiology, central nervous system, which are large categories. And we've been developing this pipeline to be the first to launch after the patent ceases to exist. So the company that can launch first, right after the end of the patent, will get a market share between 30% to 40% of that specific molecule. And we already have many of them in our pipeline. So it's a very relevant potential that we're working with our R and D to develop the products and have everything ready. So it's a steep growth, yes. Every time that a molecule loses its patent, the market expands. It depends on the molecule, of course, but the expansion provides better access to the population. So it's very substantial. The next question is not directed to one person specifically, but feel free to jump in. It's from. No. I'm sorry. It's for Adamario. Adamario is really rocking it. So I'm gonna skip. I'll go back to you, Safra. Gustavo, which is from Bradesco. How is the capture of synergies of the acquired brands? Were there any changes compared to the estimates for 2019? When do the tax synergies start for those brands? And how is the capture of marketing and sales synergies? I can answer that one, and please fill in, free to jump in. Starting with Buscopan. We just closed in September. As I mentioned in my presentation, it's going very well. In the fourth quarter, we had a 14% growth, which is the result of integrating in our marketing and sales platform. It was very simple. We bought the brands, but that shows the potential of our platform to go to market. In terms of bringing it in house, we're going to produce it in house. In the case of Buscopo, we started producing a secondary packaging for some SKUs, and we're going to have most of them produced by the third quarter in house, capturing the tax synergies. And as of the beginning of next year, we want to bring the entire production of Buscopan and capture 100% of the synergies of the entire operation. For Takeda, it's more recent. The closing was in the February. The results at first are very good. Also, the integration is going well. It's a larger team. We brought a team of sales rep, medical reps, a marketing team, but it's going well. The teams of Hypera are very excited with all the potential that we have, especially with some drugs like lactose, nosalgina, for us to bring to our platform and leverage the sales of these products. Remember that these portfolios came from multinational companies that were trying to sell these portfolios for some time. So there wasn't a lot of investment in those brands such as launching. Belmari already gave some examples. And we are being able to launch that at Hyperion. There's a lot to come in terms of launching on those portfolios as extension lines, both for Buscopo and for Takeda. Now it's for Vivien and for you, Kaviz. The question is from Joseph from JPMorgan. What are the key hurdles regulatory hurdles for a direct to consumer strategy? What part of the portfolio can you work on more easily in the direct to consumer channel? Would you like to start, Clavis? I'll start with the end, which is basically saying the portfolio. I can comment it in my presentation. Our Dermocosmetics portfolio already have an intense consumption habit in virtual media and direct to consumer market. You also see the gradual work in prevention, so vitamins standing out. What are the opportunities for the future connecting the entire digital universe from digital prescription to replenishing stores digitally so you can replenish that ecosystem, having continuous use products and regular replenishment for consumers. That's maturing. I think that's the next step. It will benefit consumers, patients and people that work with that segment. To add, more than hurdles, direct to consumer gives us a number of new opportunities. The case our recent acquisition shows us. So gives us a new, more efficient way to create new brands. And it's still a relatively small investment for us, but it should become a new power brand for the company. And it's a brand that's totally formed in digital in a completely new way. And as that one, we have a number of different opportunities to explore that job. To add in addition to the benefits that they give to the brands and also what we can learn and apply to our brands and our portfolio at Hypera. That's one of the reasons of the acquisition is having that learning and how we can apply that to the rest of the portfolio and all the other opportunities that we have in OTC brands and supplements and vitamins in our portfolio. Back to Gilerme Sis, I was just trying to ask a question to each. So Adomayo, it's from Gilerme from Safra. How does Hypera see investment in RNG to maintain its organic expense? Will it maintain levels close to 8% of net revenues? I'm sorry, net income. So we've been increasing investment in R and D. And I believe that the nominal investment that we had last year is very close to what we believe in having in the capability of developing new products. So the as we evolve in that pipeline, that investment should be made at that level. But as a percentage of revenues, it should be diluted given that the revenues should grow much more. So the process of building the pipeline, you have to invest a lot beforehand for a new product takes on average four to five years to develop and launch until you get M Visa approval, and you only reap the results of that investment after that period. So now we're going into a phase where big projects that we have in the pipeline are starting to be launched now. And with that, revenues should grow much more. And that investment And obviously, as we see new opportunities, we always have room for expansion. But it's already at a level that's very close to the maximum that we have considering the installed capacity and people as well. That's another important point. Today, we have almost 300 people that are 100% dedicated to innovation in the company. It's hard to find that kind of talent, not easy. So we're also in that process of training new people, new talent. But today, I believe that we're very close to our capacity. One more for you, Vivian, from Bruno, an individual investor. With the advance of the Industry four point o in the pharma industry, how is Hypera getting ready? What's the importance of operational excellence in that journey? Question. Last year, we talked a little bit more about Industry four point zero and some of the initiatives that we have at the plant. This year, focused more on Databot and what it's brought in, in terms of automation, the pull system in production. I talked about intelligence and production planning which reduces waste and so on. And this year, we have a number of challenges. If you go and see the Hypera Hub Web two website, you'll see a number of challenges to take Industry four point zero to another level. From challenges of streamlining processes to a bigger challenge about how do we bring artificial intelligence to increase productivity in our day to day. We've taken many steps in automation, bringing in technology, productivity. I think you've seen the video of our plan. Now it's the idea about how we leverage data to bring in a new level productivity gains and cost reduction for So our I think I believe that Hipero is in the vanguard of that entire process. And next year, we hope to have very concrete and interesting results for our day. Bruno, for you, from Gustavo Oliveira from UBS. The acquisitions in the pipeline, are they mainly focused in the institutional market or in retail? Could you comment more on that? Focus has always been retail. Our core business is retail. It still is. Institutional is a new avenue for growth from Hypera and mainly focused on organic. As we've mentioned, we made investments at the plant, we're doing investments in our product portfolio. So what we're looking for in acquisition moving forward in the very short term, the focus is to deleverage and leverage the Takeda portfolio. But in the short and medium term, we're open, and that's part of our strategy, But mainly focused on retail. But if any opportunities come up in institutional, we'll look at them. The core business of the company is pharma retail. Clave is for you. Guilherme is from San Fran. How did the medical calls cost evolve with digitization? Can we expect an average of 15 visits per calls per day after the pandemic? Well, post pandemic is a very hard question to answer, right, because we never know when it's going end. But the cost that as we prove productivity, we dilute cost. So we have the same team. We've had the same size team for two years. And even with everything that happened last year, we increased the productivity a lot. So our cost is being diluted across time. And we have more portfolio, therapeutical classes, more medical specialties. We will have to expand the team, but at a higher productivity level. In relation to what to expect in the visit levels, which is ours is 15, which is much higher than the market average, our objective is to maintain 17 after the pandemic. So we believe that remote visitation will enable us to increase the number of contacts. So on average, we have two and a half, three per day remotely. We expect that to go up to five in the medium and long term. So we're moving the scenario of digitization of that entire process medical calls. Just as an example, we had product launched yesterday, the Bisilac LGG, a probiotic. And it was able to attract in a digital event at night 2,300 physicians. Right? So it gives us an outreach that's it's limited. And as that improves, our productivity will increase, and we'll expand that with the entire panel of positions in the company. I'd like to add, this organization also enables us to get to positions that you graphed that we didn't before. So we can go much farther in addition to gaining more productivity, we can go farther and customizing the offer. In my talk, I said that we looked and understood the profile of small retailers, but we're doing the same work for physicians. We know that some physicians prefer a virtual call and some prefer them in person. That customization of how we get to the customer or in this case the physician and what we offer them is extremely important and that adds to productivity. You go farther and when and how physician wants that. One more for you, Vivian. It's from Angela, individual investor. What can we expect from Simple Organic in the medium and long part? Are there any other companies as that one in m and a in the m and a pipeline? Has Simple a very clear role in our portfolio. It goes beyond dermocosmetics. It has positioning of wellness overall focused on natural organic cruelty free products. So our objective is to expand that supply and be a hub of product innovation for that market. Simple Organic already has a pipeline. We talked a lot about hyper innovation, but when you look at Simple Organic innovation pipeline, it's also very robust. So in the upcoming months, you'll see a lot of new things. So the idea is that Simple Organic will be that big wellness hub across this journey for Hypera in that natural vegan organic segment. Once again, use your coupon. You'll have 30% discount on the Simple Organic website and also the hypero.com.vr website. Check it out. It's worth it. I did. Just did. This is not directed at anyone. This is from Mariana Hernandez from Kathy. The 28 injectable molecules molecules, have they already been developed? Can you talk about that initiative? Go ahead. We already have some that are in the short term pipeline. This year we'll launch one and some of them are in an advanced stage of development as most of them were through the partnership. Many of them are mapped and designed, but they're still in the development process. So they'll happen in the timeline from now to 2026. It's the work that's being built, and it's worth noting that most of them with partners, but as we get the part of the put that in house, then we can co develop molecules in house so that we can have that platform, and it could be proprietary. But that will happen according to the timeline. That's part of growth. But we also in the current portfolio, we already have injectables. We have an injectables plan and the solids plan that can be used and we can sell and distribute in the additional channels. Next question is from Luis Enrique, individual. How about the marketplace development? I guess that's for you, Well, it might not be b two b, but I guess it is. I mentioned a little. We're in a phase initial phase of e commerce, which is bringing users into phase to a next level. So we're creating a relationship platform in parallel where we start to customize the supply according to Fernandez and Roberta's needs and also creates our loyalty program based on the platform. The idea is that by starting and attracting new customers to this platform, today we're talking about customers that account for 20% of the customers that are serviced. Of the total one, it's a little bit smaller. So if we increase the share of customers on that platform, we can start to add new products and services. So we want to be a hub or the point where small retailers will find their training needs, products, services, be it for their point of sale or even for themselves. So the objective is that in the second half of the year, we'll add products and services to the platform and start to pilot the operations so that next year in 2022, we can, in fact, speed up that marketplace. We have one from Caio Moscardini from Morgan Stanley. How did you use distributors in the channel? Is that important for them? Could you repeat that question? The role of distributors in the institutional channel. Okay. Today, our model plans on using distributors 100% of the time. We use distributors that were mainly focused on the private channel. That's the portfolio that we had at that time. And we were limiting our operations. When we go into private did I say public or private? I think no. I said that wrong. Sorry. So our distribution was for the public channel and it was limited. And distributors were focused to develop that. When we go into the private channel, we're gonna have to have an agreement with distributors that are specialized in the private channel. They're different. And they're mainly not the same. So you have distributors specialized in the public channel that sell through public bids and the ones in the private that sell through product standardization. That's the work we're going to do with them. But always the distributors that we're going to develop. We're getting many questions and we want you to interact more and more. So scan the QR code on the screen, send your question, or click on the platform tab so we can clarify all your doubts. One thing that really stood out to me and really allows me to be very happy to be a part of HYPE Day and listening to your explanations. And this is a feeling that I have but I'd like you to talk about that. We're going through a pandemic and addition to people losing family members and friends, we see financial troubles, companies that are lowering salaries, that are laying off people. But Hypera is going the opposite way. It's growing in a year of the pandemic. It's opening up its horizons and investing in digital and increasing its portfolio, mainly focused on the Brazilian market. You must be very proud. Yes. We're very proud of that. Our focus has always been the Brazilian market and it still is. I mentioned in my presentation, it accounts for 70% of the Latin American market. It's a market that grows a lot. There's also the effect of an aging population, and that will take place for the next four decades here in the country. So we're very proud to be a part of that of this market and contributing to improve Brazilian population's health. I'd like to thank you all for dignity. Thank you. And the pharma industry, it's a very resilient market. It allows us to be bold in our future plans. And I'd also like to remind you that that's only possible because we invested in our business platform way back. We were ready to we prepared ourselves to be here today. So the new avenues of growth are here because we structured ourselves in the past. Yeah. And there are opportunities, but when you see a step ahead, you're ahead of your competition. As a MEG, an individual, how is the operation with the new restrictions because of the new cases of COVID nineteen? Well, I can start and then you can jump in. We've been taking all the precautions with our employees, but we can't stop operations, especially at the plant. Our teams that work in the plant and R and D are continuing. We have very strict procedures for testing and tracking of those who are in contact with those with symptoms. So I think we're being successful in that. Are several cases of medical leave. We had to hire additional employees to continue the plant and R and D operating. Our field teams, our policy depends on the availability of beds in the cities and regions, and we follow the lockdown rules. But a good part of the team is working from home, and this has been very productive, as Luis already mentioned. And the office team is working from home. And as the restrictions are lifted, we will, little by little, come back to the office, taking all these safety measures for our employees. We can't wait. Right? It's true. We had a little taste of that. We were going back, and now we had to step back. But I think that's part of the what's gonna happen for the next few months. We're gonna have to live with that reality. Yes. With the help of Hypera, we will win this struggle against COVID. Now it's Lucas, an individual. Do you intend to expand the production capacity to other regions? What can we expect for the next few years? I can answer that. Concentrated our operations in the state of Goias in the city of Annapolis. We see many opportunities of synergy there. Having everything in one single site, that is very productive for the company. We basically have, like, security, the, cafeteria. All those costs are reduced when you have everything in one single site. We also have a very good tax incentive for the company in the state of Guellas. So it's not in the company's plans to expand to other regions. Our focus and the investment we've been doing at the plant, as we showed you, there are a lot of other things happening. So we want to keep our operations, especially our production operations in the state of Goias in the city of Anapolis. I would like to thank the audience for their questions. I don't know if you have any closing comments. I think we covered all the questions. We had many questions in our Q and A session. I would also like to thank on behalf the entire HiPara team for your participation in HiPara, your interest. I hope we were able to convey all the opportunities that we have at the company, the enthusiasm we all feel with the company, with the results and the potential that Hypera has for the next few years. And I hope we were able to convey that message to everyone. I think it was a great hype day. I would like to thank, once again, all of you who are watching us from home or your office. This interaction with the audience makes our event even greater. Would like to remind you that as of tomorrow, if you want to watch again or if you weren't able to be with us all throughout this event, access i.hypera.com.br. Our hike day will be available. I also would like to apologize if we could answer all the questions. We will answer them as soon as possible. Have a great week. It's a privilege and an honor to be part of this event with you. And I hope that COVID goes away soon, and we can continue to grow. Have a great day. Thank you.

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