Earnings Call: H2 2015

Feb 26, 2016

Ladies and gentlemen, welcome to the UCB 2015 full year financial results conference call. I am pleased to present Madame Antje Witte, Vice President Investor Relations, who will be the moderator of this conference. For the first part of this call, let me remind you that all participants will be in listen-only mode, and afterwards, there will be a questions and answer session. If you wish to ask a question during the Q&A session for the presentation, please press 0 and 1 on your telephone keypad, and you will enter the queue. After you are announced, please ask your question. Ladies and gentlemen, please begin. Good morning and good afternoon also from my side. Welcome to our headquarter here in Brussels. It has been 10 years. We haven't been here with this meeting, so I'm really glad to have you here and to host you here in our premises. I'm happy to open our full year results conference for 2015, and I'm happy to hand over to Jean-Christophe Tellier, our CEO, who will also introduce his presenting team today. Thank you very much. Thank you, Antje. Good afternoon, good morning, everyone. I didn't know it has been 10 years since our previous full-year result presentation here. So welcome back here in Brussels and a warm welcome to you who are in the room with me, and also for those of you who joined via the line. As Antje said after this usual slide, this is what we would like to cover this afternoon with you. First I will do an overall introductions, and then we change a little bit the classical order of this presentation of the full year, where we classically start by the numbers. We thought that with the news of last Monday, you maybe would prefer to start with the breaking news that we had on romosozumab. Iris will help us and help you maybe to go through that. One caveat although, please you know that we cannot disclose any further information than the one that we have disclosed in the press release. So, don't expect new numbers or new facts. But what we would like to be more happy to share with you is how we see these numbers and what we think that means for us. Then Detlef will come back with the more traditional flow of information, and I'm sure you are very interested to listen from him the achievements of 2015. Then we will go to the different patient value units. First starting with Cimzia with Emmanuel, and Jeff for the neurology. After a short conclusion, we will open to a Q&A. When you think about the UCB and how I couldn't describe quickly the strategy, maybe for me, the best way to describe it is around four key areas. The first one is, as you know, we have described it as a patient value strategy. What do we mean by that? We mean by that everything we do, we try to start and end by having the patients in mind and keeping the patients all along the way. Connecting the patient to the science and the science to the solution and the solutions back to patients is, for us, an operating model by which we evaluate all the investment that we are doing, and we put this at the heart of each decision maker. Putting the patient at the start and the end of everything push us, of course, to the second pillar of the strategy, which is an innovation strategy. For us at UCB, and you know that because it has been very long period of high investment in R&D, for us it's a very important element. Why we do this high investment in R&D for, and romosozumab is a good example of that. In a sense, the main reason is obvious, right? It's making sure that we provide differentiated solution for patients suffering with chronic disease who wants to live the life they want to live and not suffer anymore. If we want to do that, we need to go at the heart of the science, and then we need to innovate. The additional element of innovation for us is the fact that innovation is an area where quality is more important than quantity. For a company like UCB, focusing all our resource on the qualitative element and not be depending of a quantitative element is an area of success. The third element for the strategy, it's the component of networking and connectivity. We think that if we want to continue to build on this qualitative element, the most important are the people. At the end of the day, it's the people that make the difference and the people within the company and external to the company. Ability to build network, ability to connect with the best people that are innovative, that are concentrating on area of science where we can leverage our capabilities and their capabilities is the best way for us to be successful. So we are using networking. We are using this connectivity not just to build strong connection, but to make sure that we can make people working together on things that they like in order to make sure that they have an impact and to maximize their impact. At the end of the day, all of these elements need to build a growth strategy. At the final element, you will see that 2015, in a sense, have been a wonderful example of what this strategy in action mean in terms of implementation. So it start with the strong growth of our core pillars. It continue with the maturity of our late-stage pipeline, and then in the future it will continue to grow with breakthrough early stage pipeline. I said 2015, as you have seen in the press release this morning, is a good example of this strategy. You see here some of the key achievements than we would like to cover a little bit in more detail in the future. I don't want to cover each of them, but you see here few achievements that have been in 2015 key milestone of the year, which make us very confident to continue to confirm our midterm targets of the 30% of profitability as well as reaching at least EUR 3.1 billion of sales with Cimzia, Vimpat, and Neupro before the end of the decade. With that, I would like to hand over to Iris that will help us to better see the result of romosozumab. Thank you. Thank you very much, Jean-Christophe, and hello everybody, and good afternoon and good morning to all of you. Yes, let's talk about romosozumab. As you know, we developed together with our partner Amgen, romosozumab as sclerostin antibody for patients living with osteoporosis. Please also keep in mind that romosozumab is a very innovative first-in-class molecule that targets the most potent bone-building mechanism that we know about. I am also happy to report to you that in the light of the FRAME results, the first phase III results that we received earlier this week, we can confirm all of the previous data points that we have seen with romosozumab. Whether we look at biomarkers of bone formation, whether we look at biomarkers of bone resorption, whether we look at bone mineral density, the FRAME results, the first phase III study that has read out for romosozumab confirms everything that we have seen before, and we now add the first fracture incidence data into the mix. Before we talk about the results, there are two topics that I want to discuss with you, and I would like to start with the design of the FRAME study. It is our placebo-controlled phase III study, so patients who were randomized either received romosozumab or a placebo for the first 12 months of the study period. After 12 months, patients switched to denosumab, which is a potent anti-resorptive agent. Patients in both treatment arms, whether they were on romosozumab previously or placebo, switched to denosumab. We have two endpoints in the study, one after 12 months, so in the end of romosozumab versus placebo, and the other one after 24 months, so in the end of the treatment period with denosumab. It is very important for me that you understand that what looks like placebo is not placebo in the second year because placebo patients were switched to a potent anti-resorptive treatment. This is a very unique, very innovative design, and let me be very clear, it does not work in favor of romosozumab. Why did we go for this design? When you do innovative things, it is not easy to fit into existing paradigms, and the regulatory paradigm for the treatment of osteoporosis is that you have to observe patients for two years. That is the earliest regulatory endpoint. As it is a placebo-controlled study, we do not feel comfortable with treating patients with a diagnosis of osteoporosis for longer than 12 months with placebo. We needed an active continuation treatment. Romosozumab, as we have seen in the phase II, builds bone faster than any other mechanism. We have seen this with the bone mineral density data, and romosozumab is very suitable to unfold its efficacy within a first-year treatment cycle. We have fulfilled our ethical commitments to patients. We have fulfilled what the regulators want from us, but it's a high hurdle for romosozumab to take to, in the second year, beat an active control group. I just want you to be aware of the challenges of this innovative and much-needed study design. The second challenge I want you to be aware of is the patient population that we have enrolled. Because FRAME is a placebo-controlled study, you can of course not enroll patients with severe osteoporosis. If you look at the entire spectrum of osteoporosis, it really lasts from patients who've just received their diagnosis and are kind of on the healthy side of osteoporosis to patients on the other side of the spectrum who have had so many fractures due to osteoporosis that they are wheelchair-bound. If I should try to illustrate to you where the population in FRAME sits, it's very much on the healthy side of the osteoporosis population. This choice by our investigators has resulted in a very low event rate of fractures on placebo. It should be very obvious for you that it's difficult to show the reduction of events if there are not many events. That's a challenge for any drug, and that has been a challenge for romosozumab. I want you to clearly understand that what we see in the results that have been disclosed to you is to a large extent driven by the low fracture incidence in the patient population that was enrolled. With that in mind, the challenges of the design and the challenges of the study population, let's now talk about the results. The primary endpoint or the regulatory endpoint in osteoporosis is vertebral fractures, the reduction of the risk to incur new vertebral fractures. The authorities choose vertebral fractures because it's the most frequent osteoporosis-related fracture and therefore makes the size of clinical studies manageable. It's also a very relevant fracture because, of course, it's a burden to patients. We have seen a reduction of the risk of new vertebral fractures in this patient population of 73% after 12 months, maintained despite patients on placebo moving to active treatment at 75%. We have seen this fracture risk reduction with a p-value that, in the terms of FDA, is persuasive. It's so robust that the agency would consider with a p-value like that to base a biologics license application on only a single study. That's not a specific agreement for this trial. It's a general regulatory comment that you have persuasive p-values. You have to hit a p-value below 0.01 if you want to base an application on a single study, and the p-value that we have seen for the primary endpoint with romosozumab is way below that, so we're in good conditions there. Then, of course, the study has a number of secondary endpoints, and we have run a hierarchical statistical testing. You test one after the other, and if you reach an endpoint where there's no more significance, the statistical testing stops, and beyond that, all of the p-values that you achieve are coming from kind of an exploratory analysis, and will not be regarded as statistically significant as you have in all of the analysis above the stopping of the analysis due to a negative p-value. The first secondary endpoint that we have analyzed is on clinical fractures. So what is clinical fractures? Clinical fractures include all fractures that are symptomatic and that, in the end, lead the patient to see a physician or to go to the emergency room. Many vertebral fractures are not clinical fractures because many patients will just think, "Oh my goodness, I really had a very bad backache today," and will not go to see the physician. These vertebral fractures are then later on diagnosed in an X-ray. There are, of course, also vertebral fractures that are so severe that patients go and see their physician, and they would be counted as clinical vertebral fractures. Then every non-vertebral fracture is a clinical fracture. So that's the illustration of the endpoint of clinical fractures, which was our first secondary endpoint that we analyzed and which showed a statistically significant fracture risk reduction of 36%. The analysis went then on to the next secondary endpoint, which included non-vertebral fractures. As I've mentioned to you before, they are also an important subgroup in the clinical fractures. In non-vertebral fractures, we did not see significance anymore. Please keep in mind, for a non-vertebral fracture, you need two items. You need osteoporosis, but you also need a trauma. They don't happen without a trauma. Of course, in a study that's not event-driven, we cannot control for this to happen. Again, we're talking about relatively small numbers of events, and it's the numbers of events that drive the statistical analysis and the significance. It's not the efficacy of romosozumab. Then again, as I said before, we have a number of other secondary endpoints that all trend in the right direction, but for statistical analysis purposes, the significance level stops here. I would also like, of course, to talk with you about the safety of romosozumab, and that's a very important point because please keep in mind, for the first time ever, we have seen exposure of a large cohort of patients, more than 3,500 patients, to romosozumab for a year. I'm very happy that we have not seen significant differences between placebo and romosozumab during these 12 months. It's not something that you can easily expect when you test a very potent new mechanism of action. We have highlighted to you that we've seen a difference in injection site reactions, 5.2% with romosozumab, 2.9% with placebo. We have also, for the sake of good order and because we want to be conservative when it's about safety, we've also flagged to you the incurrence of an asymptomatic femoral fracture and the occurrence of two cases of osteonecrosis of the jaw. In none of these cases, we have evidence that they are related to romosozumab, but again, we want to be conservative when it's about safety, and for that reason, we observe these cases further. They are not a signal yet because the incidence is below 0.1%. But again, we will watch for these adverse events that have been related with other osteoporotic treatments. What's particularly important for me is that we have ruled out a number of safety concerns that might potentially have been related to the mechanism of action of romosozumab. As you know, we have conducted a number of sub-studies. One sub-study was about hearing loss, so we did a study with audiometry, and we now know that there's no difference with regard to hearing loss between romosozumab and placebo. For safety, it's very good news if there's no difference between placebo and active. There's also been concern whether sclerostin inhibition might be adversarial to osteoarthritis. We have done a sub-study in patients with osteoarthritis of the knee, and again, same result for placebo as for romosozumab. We have looked at cardiovascular serious adverse events, no difference. All of this is good news, and I would really like to highlight to you what's, for me, the most important substudy, and that's the bone biopsies. The bone biopsy substudy has again confirmed that the formation of bone with romosozumab in terms of structure, in terms of mineralization, is good quality, healthy bone. A lot of good news in the study, and please bear with me. What I've shared with you is really top-line results. We're still going through a lot of pre-specified analyses. We will need more weeks, more months, to really get our arms around these data. I know that you also understand that we cannot go into more details because that would compromise our ability to publish in a scientific journal, to present the data at a scientific congress. Of course, we feel very strongly that's the right thing to do for patients and for romosozumab. Please also keep in mind that this study is only the beginning of our regulatory program. We will, in a few months from now, have the data from the BRIDGE study, which is the male osteoporosis study. This study has bone mineral density as an endpoint because we know from regulatory precedent that we can extrapolate positive bone mineral density data in men with positive bone mineral density in women if there is positive fracture risk reduction data in the female population, and we have that now. Please stay tuned for the BRIDGE results in male osteoporosis in a few months from now. Then, of course, we have the ARCH study underway. The ARCH study is an event-driven study that's controlled by alendronate, a very potent bisphosphonate. In this study, we have enrolled a more severe patient population with low bone mineral density and preexisting fractures, and this study will read out in 2017. Just to remind you, why are we doing all of this? We're doing all of this because one in three women beyond the age of 50 will experience at least one osteoporotic fracture during their lifetime. One in five men beyond the age of 50 will experience at least one osteoporotic fracture during their lifetime. Osteoporosis is a silent disease, but it's everywhere. If you think about the friends of your mothers and grandmothers and grandfathers, you might find people who become more frail, who lose height with time, who bend forward. That is not old age. That is the consequence of vertebral fractures, and they are the consequence of a disease called osteoporosis, and that is a disease that we can treat. Please keep that in mind. With that, I thank you for your attention, and I hand over to Detlef for 2015. Thank you, Iris. You do the click for me? Oh, sorry. Thank you. I was happy to hear and to read that you felt like I felt that these were strong results for 2015. You know that slide. We use it quite regularly, and I am very happy to say I love the color green. When I see also the percentages being sizable, I love the color even more. I love also the color red when it is about expenses, when the context tells me that they are not growing as fast than the top line. This is really all going in the right direction. I think we are very happy with that. Let us be clear, and you see it between the constant rate development and the actual rate development. There is some tailwind from FX. Even if you take that out, this would have been already very strong results. What is important about these strong results? Important are the two things that you see on this slide. Let's start with the right side of the slide. What we see on the right side of the slide is the development of our recurring EBITDA ratio. You know that we have been promising, and we intend to deliver on our midterm guidance of 30%. You heard me saying that there will be an acceleration towards that 30%. I am happy to say you see an acceleration, and you see an even more pronounced acceleration than probably I would have thought last year because some of the FX plays a bit into our favor. It is exactly like we were thinking it should happen. So we feel very confident on this guidance, and the question now is, why does this happen? It happens for the reasons that you know, the reasons that we told you. The reasons are with more sales of the core products and cost of goods of these are being less than what we have in average, you should see a gross margin improvement. When you look to the left side of the slide, this is exactly what you see. As better our core products are doing, and they have been doing very well as you have seen, as more pronounced is this effect. The second is, and we talked about that, too, that yes, you can expect when this is happening, there is a scaling effect on some of the cost. I am happy to report this is what you are seeing. So the underlying effects that we were promising to you is not wishful thinking. It is facts that are happening, and they are happening in a very, very mathematical way. That is why we see this positive development. There is really not too much to say here. You saw that when you were calculating, and I know we are all very good in calculating precise numbers, that the R&D expenses were short close to 27%, a bit lower than what we guided upon, which does really mean that we have been able to, first of all, reallocate well, secondly, be very efficient, and certainly having not spent the money where we don't think it makes an impact. I expect still that going forward, this will be a little bit higher because we see some of our good pipeline advancing. However, in totality, I expect operating expenses to go further down. We have not seen any surprises on marketing and selling. We have not seen any surprises on G&A. They are all going the right direction. You see also that amortization that when you think 5 years ago, was nearly as big as the operating EBIT coming out of this. This is really what is not so much of an importance anymore. It will still be growing slightly, but it will play less and less a determining role, and this is very nice to see because it means the quality of these results is much better because what is behind that, you are making cash out of this. So also your cash conversion ratio and all of these things that are important for you, for us, for the shareholder, will be going into the right direction. We have seen last year two, three events that were also very meaningful for us in UCB. The biggest one was the KU divestment. But we had other divestments of non-core products that you know we do each year because we feel that as more that we can afford to base our efforts on our core products, it is good to recycle both the value and the investment into these non-core products into the core products. The result of that is that we are sitting at year-end on a nice pile of cash, EUR 1.3 billion. And it's very nice that we have that because what is it really doing? First of all, it will be paying all the debt that is reimbursable in 2016. It will leave enough to do what we want to do on a daily basis, and it will give us the strategic and the financial flexibility that we need, and honestly, that for a number of years we didn't have. That is an important inflection point, and that comes together with, what I would say, nearly a perfect maturity schedule going into the future. And that is what you also see on this slide. Starting 2017, you see years of no reimbursement or years with bullets that compared to what we believe we will deliver in cash flows in these years is very insignificant. Which does mean we are going from a phase where we had to pay down debt from the big acquisitions in 2004 and 2006 into a phase where we have opportunities for either investing in new things or being in a very comfortable situation going forward to take opportunities. The acceleration has not stopped this year. It was a beginning of the acceleration. Next year will be the next phase of it. We will increase our guidance in next year from this year to next year towards revenue to EUR 4 billion to EUR 4.1 billion. You saw that. And then over proportionally, and that comes back to the reasons that I explained before, we will increase our guidance for the 2016 year to EUR 970 million to EUR 1.01 billion. And core EPS is much more a calculation based on that than anything else. So it just follows. What are the reasons behind that? We have strong growing products, number one. Number two, expenses are well under control in a scaling environment. And while we want still to invest into our growing pipeline, in overall terms, it allows us to drive these costs down. Just for you, in terms of taxes, because I know you're always fascinated by our taxes, as I am too, there's nothing new to say. If you are still in the upper 20% range, you are in a safe place, and we will see this improving towards the other years to come. You have noticed probably also the 188 million shares. For the ones that ask themselves why is it less than we had before? Before we had also bought shares to fund hedge our long-term incentive programs, but we used these shares through share swaps in terms of optimizing our cash flows. And nowadays, this is not needed anymore. We have enough liquidity, we have enough cash flows coming in, so this is not needed anymore, and therefore you don't see them anymore. So they have now been put into the treasury shares. Midterm guidance, nothing changed, 30% in 2018. We are close already today on the net debt ratio. I would not expect movement next year in terms of lowering that because you have in mind there is still a sizable hybrid to be paid off, which was not counted in net debt. You will see that impact, and that has to be swallowed in 2016. Yes, Jean-Christophe, you already said it, nothing new. We will make the peak sales guidance. All in all, strong numbers driven by strong products, giving us the flexibility to invest into a strong pipeline and with an improving profitability going forward, which will improve our financial and strategic flexibility going forward, too. With that, I think I hand over to Emmanuel to show what strong products mean. Thank you, Detlef, and thanks all for being here and being on the line. Cimzia is a blockbuster. You followed the Cimzia story, most of you, since 2008 when it was launched in the U.S., and of course, we are very pleased to have crossed that EUR 1 billion line in the footsteps of Zyrtec and Keppra, which were UCB's previous blockbusters. How did we get there and what does it mean? How can we comment on this? Well, the first thing to notice is that the operational growth stood at 21% last year. This was really fueled by the increasing utilization of Cimzia in the new indications of psoriatic arthritis and axial spondyloarthritis. As you can see in your handouts and in your slides, the growth was above 20%, both in the U.S. and Europe. Net net, there was not really a price effect with some, let us say, marginal price decrease in Europe and in the U.S., some slight positive on the price linked to the increase early last year. In Japan, the ex-factory sales of UCB to Astellas are down. We have built down together with our partner, the inventory at Astellas, and so we are starting the year with a rather low inventory. The in-market growth in Japan, as we will see later, has been very healthy this past year. I think we are going to see normalized figures there. We have started a number of life cycle programs, which aim to bring incremental value to patients and really build the differentiation profile of Cimzia in a market which is becoming more competitive, of course, and whereby similar entries are lurking. You read last year that we started the phase III psoriasis program with our partner, Dermira. You also read from their press releases that the three phase III studies fully recruited, including the study which is comparing Cimzia with Enbrel, and that is a head-to-head study, the first one between anti-TNFs in the field of psoriasis. The results of those three studies will become available by the end of the first quarter 2017, and should grant Cimzia another indication on top of the four it already has obtained. In addition to that, we not only got phase III results last year for the C-EARLY study, which is a study in DMARD-naïve patients, so patients who have developed rheumatoid arthritis for less than a year, and patients who typically would start with methotrexate first. This study compared Cimzia plus methotrexate with methotrexate only in an optimized regimen, so really pushing the dose as much as possible to fully benefit patients. The results were very clear. It makes sense in this population, or at least in a substantial portion of patients, to start with the combination treatment. Based on this, the European authorities granted a label late December 2015 for Cimzia to be used in this population. You also remember that this study had a second phase to it, which was a little bit exploratory in nature. This phase was testing whether patients who achieved sustained low disease activity, which means really in stable, low disease activity for at least three months after that one year of treatment, whether they could be half dosed or whether they could even stop Cimzia and just continue on background methotrexate. The results, I think, are confirming that this principle of a window of opportunity to treat RA, so the need to treat early. Because of the lower number of patients entering into this phase two compared to what we expected, we haven't quite reached statistical significance. But the results which will be presented at an upcoming rheumatology congress will show that there is, I think, a lot of clinical meaningfulness in considering a different way to use Cimzia. In addition to that, we have started a non-radiographic axSpA program with Cimzia in the U.S., with the aim to be the first agent licensed for that population. So that program is running now, and we're expecting results later in 2018. The EXXELERATE study is a study that most of you are aware of. It is the first head-to-head study comparing two anti-TNFs in RA. In this case, the active comparator is Humira. The results will become available in the next few months, so it's clearly going to be a big event in the RA space. Nine hundred patients were included. There are two endpoints, a week 12 ACR20 endpoint, and at two years, we're measuring low disease activity, which is really what physicians and patients aim for. I look forward to those results, and suffice it to say that this week 12 decision making, this week 12 therapy adjustment window, is becoming more and more important as more data accrue and show that patients who don't have a minimal response at that time are unlikely to achieve a major or even a moderate response later on. Finally, there's the juvenile idiopathic arthritis study, which is finishing, and results here will become available this year as well. With all of that, we're in a good position to track towards our peak sales guidance of EUR 1.5 billion. And I would like to give you a little bit of detail as to not only how we did in growing versus our past performance, but also how Cimzia has been performing compared to the market. And we're focusing on the rheumatology indications here because in Crohn's disease, basically, we've had a stable number of prescriptions in the U.S. So in rheumatology, Cimzia has been growing above market growth and above anti-TNF growth in the U.S., in Europe, and in Japan. As I said, this is driven by performance in new indications. But in the U.S. and Japan, RA has continued to grow significantly as well. I think that we can start the year 2016 with solid momentum behind Cimzia, and this in a place where the access is pretty stable in the U.S. I am using the same template than the one that you have seen in the past, showing that our total number of lives is more or less stable. This again, bodes well for 2016 in the U.S. as well. I would be glad to take questions later on. Now I would like to hand over to my friend, Jeff. Thank you, Emmanuel. Good afternoon, good morning. Welcome to UCB, and for those of you online, welcome as well. I want to frame my conversation today in three different categories. I want to talk to you a little bit, thank you, about Briviact. I also want to talk to you about 2015 results, and then spend some time talking about how Briviact fits into our portfolio. I will start off with Briviact, and it is a wonderful opportunity to introduce you to our newest add-on solution for patients 16 years of age and older who suffer from partial onset seizures. We are very excited about recent events. We received approval from the EMA January 19th. We have already launched in the U.K. We have launched in Germany. Over the coming weeks and months, we will launch across Europe. Likewise, last Thursday evening late, we received approval from the FDA for Briviact. We are just now waiting for DEA scheduling. As a note, last year legislation was passed that requires the DEA to provide scheduling for us basically in around 90 days or so, roughly 90 days. Sometime between now and 90 days, we will receive the scheduling, and the U.S. team is excited and ready to launch. We have one of the largest phase III programs ever in epilepsy, involving over 1,500 patients, 18 years of clinical trial experience with 2,400 patients, and we bring Briviact to market with a lot of confidence and also a lot of insight. If you look at our top-line clinical results, they are significant. 40% Oh, I am sorry. Let us get the slide up so you can follow along then. 40% of our patients experience seizure freedom into the tune of 50%. This will provide confidence to our healthcare providers. Likewise, 5% of these patients were actually seizure free. This is a very important number because 30% of all patients are refractory. We are excited to launch the product, but likewise, we are very excited to create a unique Briviact patient experience. This is guided by patient insights, and we understand and have heard from patients the difficulties that they face and something that they describe as this life in between. Life in between revolves around anxiety and uncertainties, wondering when and if they will have a seizure. Life in between also prompts this deep desire to know. Will the medication work? When will it work? Will I have a seizure or not? This is where Briviact is very unique and it is very differentiated. There is no need for titration. In day one, a patient receives a therapeutic dose, and this is very unusual in the oral anti-epileptic category. I want to show you a simple go-to-market slide. Remove the wait and see what Briviact can do because patients need to know. We spent a lot of time with stakeholders, including payers and physicians and caregivers, but we have spent quite a bit of time with patients. Patients have helped guide us on our go-to-market strategy. In fact, we like to say designed by patients for patients, and we continue to hear about this life in between. I just want to tell a story and paint a picture of exactly what that might mean for our patients. A patient is controlled on monotherapy, and they wake up Monday morning, and they have a seizure. Immediately they step into this world of life in between. They have anxiety, they have concerns, but there is a little bit of hope. Perhaps it is just an ad hoc seizure. Perhaps I have stress at work. My diet is in shambles. Wednesday morning, perhaps they have another seizure, and this cloud of uncertainty, anxiety continues to be amplified. Then very important questions come. Will I have a seizure at work in front of my coworkers? Will I have a seizure at school? I am going on a first date this weekend. Will I have a seizure? I am worried about embarrassment. Then the more serious questions. Will I have a seizure in a dangerous situation? Will I be by the stove? Will I be taking a bath? Am I driving? Am I not driving? A lot of concern here, and it is warranted. In the U.S. alone, seizure-related deaths, it is hard to get the exact number, but between 50,000 and 60,000 patients, so their concern is legitimate. When you think of oral anti-epileptics, you have to consider titration. It is a core of oral anti-epileptics. Titration takes between 1 week, 2 weeks, 3 weeks, 4 weeks, up to 10 weeks, and during that time, patients are in this life in between and have concerns. Once again, we believe that Briviact can make a unique difference for these patients. It is too early to really give you great insights from the U.K. and Germany. But we found the physician that wrote the very first prescription for Briviact in the U.K., and when the team talked to him and asked him, "Why did you prescribe?" In fact, he actually prescribed before we had it in the distribution channel. We heard two things, and I think these two points are very relevant. Number 1, he was anticipating Briviact, and that is what we see, that is what we feel, and that is what we hear. We know the market is anticipating Briviact. Number 2, he described the perfect patient profile. A patient that had breakthrough seizures, that did not want to go through titration, did not want to wait 10 weeks, did not want to wait a single week. That is the perfect profile for a Briviact patient. Moving on to our 2015 results. A strong year. A very strong year for neurology. Almost EUR 1.7 billion. We have seen a real rate growth of 25%, a constant rate growth of 13%. But I just want to highlight our products. Vimpat, we have seen a 44% real rate growth, 26% constant rate. Something you should know, we are seeing this growth in a very linear fashion across the globe. The U.S., 28% growth. Europe, 20% growth. International markets, 26% growth. Strong, linear growth across the globe. When you look at Neupro, very steady performance, 22% constant rate. We are seeing wonderful growth in Japan, and also Europe carries a lot of weight with Neupro, actually around 60% of sales. The U.S. continues to grow, especially in PD. Keppra, it is always a surprise, is it not? Keppra continues to perform well, and maybe three reasons for this performance. Number one, China and Japan, very strong growth. In Europe, less decline than what we thought. In the U.S., we had some generic manufacturers that had difficulty with levetiracetam. Also, we had some wholesaler initiatives that prompted some large orders at the beginning of the year, and that actually prompted a strong U.S. growth this year. We are very excited about Briviact, but we are just as excited about how it fits into our portfolio. When you think of epilepsy patients, let us just run through the numbers. 50% actually respond to monotherapy. On the flip side, 50% do not. For those 50%, add-on therapy is needed or polytherapy. One add-on, two add-ons, three add-ons, potentially four add-ons, and yet still 30% of the population is refractory. We know this. There is not a single solution that works for the majority of patients. UCB is very proud to bring another product to the mix that can have a tremendous difference. We receive the question quite often, and that is, how does Briviact fit into your portfolio? Will it cannibalize Keppra sales? Is it just another Keppra? What will it do to Vimpat? Please tell us how it fits. In our mind, it is synergistic with our portfolio, and we hear that from external experts as well. Quickly, let me just run you through the way we look at this and how many of our external teams look at this as well. First off, Keppra. It is a heritage medicine with a wealth of real-world data, and it is transformational in nature as it bridges from the old AEDs to the new AEDs with a different mechanism of action and a very different clinical profile. Let us not forget that Keppra is relatively new in some parts of the world, leading that transformation. We are not so long in Japan. We are not so long in China. We just recently launched in Brazil. Keppra continues to create value. Vimpat is a foundational focal epilepsy medication with an ideal profile. We are starting to hear the terms gold standard for Vimpat. I think it is a little too early, but we will take the compliment. When we think of an ideal profile, it is about efficacy, it is about limited drug-to-drug interactions, it is about safety, and also we continue to enhance the indications. I think you are aware that we launched a mono indication September 2014 in the U.S. and just applied for a mono indication this January in Europe. Vimpat fits perfectly with other antiepileptics, and especially in the U.S., it fits hand in glove due to that mono indication on Vimpat, and we hope to see that fit in Europe as well. Then we have Briviact. Uncompromising strength. It provides clarity. It is immediate, and it will fit as well. It is a wonderful add-on to Vimpat, as well as a wonderful add-on to other medications. The bottom line is this, we have a wonderful portfolio. I believe it's one of the best in the world in the antiepileptic space. We're very excited to make sure that we continue to match the right product to the right patient at the right time, and that is our goal. With that, I'll turn this over to JC and look forward to any questions you might have later on in the presentation. Thank you, Jeff. Thank you, Jeff. Thank you, Emmanuel. Thank you, Iris, and thank you, Detlef. This is what we wanted to cover with you at the first part of this presentation of 2015 full-year results. As I said in the introduction, 2015 was a really powerful illustration of what our strategy means in terms of results and in terms of impact. If I go back to what we have presented to you, I think you can see the growth that we have illustrated. I think you can see the trend, the dynamism of our core product. Please keep in mind that these products are protected at least until the end of the decade with Cimzia, who has the protection until 2024. This period of growth that you see now is really just the beginning of this period of growth. On top of that, these three products represent now more than 50% of our sales. With the solid Keppra on top of that, we have almost 80% of our sales with these just four products. Yes, very solid position and a growth position. The second component, what we think we are in a position of strength also, is our pipeline. The achievements of the last week in terms of late-stage pipeline is a good illustration of that. Jeff just commented a few seconds ago about Briviact and the first step of Briviact on the market. We are expecting pretty soon to get it in the U.S. also. Iris gave us a lot of illustrations of what means the FRAME study for romosozumab that we get earlier this week. We are very pleased with this result of our late-stage product. Detlef mentioned it, all of that is built on a very solid financial structure. Not only we have the appropriate numbers in terms of growth, but we grow faster than our investments, and we continue to expect that in the future. Meaning that our profitability is growing nicely. On top of that, we have the current structure and the current solidity that we can build on the future, having new products, Briviact in particular, that fits very well with what we have already today. We don't need a massive infrastructure in the future to continue to grow. The focus is also another element. The divestment of KU last year was the most significant part. As time will allow us, we will continue to make sure that we keep the focus to our key product. Last but not least, our innovation strategy is also to make sure that our early-stage pipeline advance. We didn't want to make too much of comments at this presentation because there have been so many things in the late-stage pipeline. I just want to quickly make sure that you see this slide and you recognize that we have made great progress here also in 2015. If you think about it's the first time ever that UCB had eight products in early stage from clinical phases. Either phase I-B or phase II-A. Here you have a list of nine different program for these eight product. The most advanced is the bimekizumab, for which we have a phase I-B and II-A program that we will present results in the near future. We think that for this molecule, the hypothesis is that adding the activities on interleukin 17F on top of the A will bring additional clinical. And it is a good illustration of what we want to do in our early-stage pipeline. As you know, it's a blend of either full new mechanism of actions, new targets, and completely innovative future products, or products that can bring a significant difference for the patient because this is a strategy. And a nice portfolio management can illustrate that. And so you have here the different product that we have in the early stage. So bimekizumab, anti-IL-17A and F in various immunology indication The addition with Cimzia to be tested in rheumatoid arthritis, because we know that when you treat rheumatoid arthritis patients with an anti-TNF-alpha, the level of IL-17 maybe goes up. So adding an IL-17 to an anti-TNF may help the patients to go faster into a low disease activity, which is, as Emmanuel said, an important criteria for the long-term control of these patients. We have the PI3K delta inhibitor in Sjögren's disease. We have also the anti-CD40 ligand in lupus with our partner Biogen. And then we have in phase I, different products that we have with different partners. Vectura's immunologic products in asthma. We have the Neuropore partnership that, if you remember, we have signed last year in January in Parkinson's disease. It's a potential disease-modifying product and agent. And we have our latest asset in immunological disease with the King's College in London that just started phase I. So you can see here really a very rich potential pipeline. It's early stage. It's what we named the learn phase. We want to build an hypothesis. We want to test the hypothesis, and then during the confirm phase, we will then prove by the phase III. So I hope that you have even get through this presentation a better sense of the strength position that we think we are in, and the confidence that we have in our future to continue to leverage the skill that we have, the asset that we have, the people that we have in order to provide more value for the patient and for the shareholder. And with that, Antje, I will maybe turn over to the question. Thank you very much. Can we now open the Q&A session? I'm asking if we go Oh, gentlemen. Can I go by the alphabet or how do I do that? Richard, please why don't you start and then Nicolas. Thanks very much. It's Richard Vosser from J.P. Morgan. Three questions, please. Just on your margin target of 30%, just some clarity on that in the context of the positive RoMO data. I think it's clear that from that data, RoMO will probably be on the market in 2018. Maybe I'm slightly getting ahead of myself, but on the back of the FRAME data. So what are the implications on the long-term targets from RoMO? I suppose that would be a ramp-up phase where that might not be that profitable. Then just two RoMO questions. Firstly, just on the clinical fractures that you mentioned, the 36% benefit, if you could just give us any flavor or color on the distribution between vertebral, non-vertebral, clinical fractures behind the endpoint, if that's at all possible at this stage, that would be very useful. Secondly, on ARCH, you mentioned it's event driven. Just thinking about the number of events here and wondering about how the powering has been directed towards vertebral and non-vertebral fractures in ARCH as well. Thank you very much. Should I start? The margin question is an easy one. As you know, we have been very confident on RoMO, so all these midterm guidances that we have given, therefore also the 30% EBITDA target is clearly taking that into consideration. Richard, thank you for the romosozumab question. I think there's not much more that I can disclose on FRAME. please bear with us. We continue to analyze. We'll create transparency on all the data, including the distribution between vertebral clinical fractures and non-vertebral, but it's too early at this stage. stay tuned for the scientific publications, please. On ARCH, of course, we will have a look at ARCH also in the light of FRAME. We'll make sure that we have enough events included. For the time being, we are very confident that due to the different population, we'll see the expected results. Hi, good afternoon. Nicolas Guyonnet, Morgan Stanley. Three questions, please. the first one is for Detlef on long-term margins this time. I think that the '16 guidance kind of validates the midterm 30% target. We all trust Detlef will deliver on that, and we also all know he's already preparing 2020 and beyond. any sense of what long-term target, three, five years may look like? Is 30% just a ceiling? two RoMO-related questions for Iris. The first one is that you mentioned a disadvantage in the design of the FRAME trial with very early-stage patients. Is there any risk that you may decide to wait for ARCH results also for the U.S. submission? the last one is a more backward-looking question. All the other anabolic agents demonstrated a benefit on non-vertebral fractures after 18 or 20 months. could you elaborate on your decisions to give RoMO for only 12 months before switching to Prolia? Thank you. I can start with the long-term guidance question. A bit too early to go into the long-term guidance, but very happy to hear that you all trust me and the team to deliver. I think to not evade the question, I think we have some very interesting things that are happening. We have two new products coming to market. We have an environment that is changing. We have a lot of volatility on FX. We have a lot of new products early that will play a role in that timeframe eventually. I would like to wait a bit more to really have something, again, solid to tell you so that you can trust that new guidance again. Yeah, Nicolas, as I had mentioned, we have a persuasive P value in the FRAME study on the co-primary endpoint. The study is suitable as the foundation of a biologics license application submission to the U.S. FDA. That's the current regulatory strategy. Of course, we have to complete our analysis. As I mentioned, we have just started. We have disclosed the top-line results immediately to you, but there's a lot of analysis still ongoing, and you will have to give us time to look into these. We'll also have to talk to the regulators. All of this is not unusual and not related to this project. That's what we would always do. At this stage, we stick with the current regulatory plan. On the non-vertebral fractures, again, based on everything that we have seen so far, and we need to dig deeper into the population. The strength of romosozumab is still that it builds bone faster than any other agent. As I had mentioned to you, due to the population and the low fracture incidence with placebo, this has been difficult to demonstrate, but that's a population topic. Again, we need to dig deeper there. That does not change the hypothesis of romosozumab and the way we look at treatment with romosozumab. Okay. Do we have further questions from the room? May I then ask the operator to open the line? Of course, in the room, if you have something, just you know where to find me. Yes. Thank you. Ladies and gentlemen, we will now begin our question on phone. If you wish to ask a question, please dial zero and one on your telephone keypad. We have a first question from Richard Parks, Deutsche Bank. Please go ahead. Hi. Yeah, it's Richard Parks from Deutsche Bank. Thanks for taking my questions. I've actually got three on Romo, so they're all for Iris, actually. Firstly, the feedback I've had is that non-vertebral fracture reduction is important for severe osteoporosis patient treatment. Obviously, that's where Romo will fit in. It did surprise me a little bit that there wasn't a mention of at least any trends on some of the notable fractures. What I'm trying to understand is, should we take it that you haven't seen any trends, or is it simply that the data hasn't yet been analyzed to dig to that level? That's the first question. The second question is, the implication here that you see, as you said, a lower event rate that impacted the outcome of the study. What I'm trying to understand is how you've managed to get such a persuasive P value on the vertebral fractures, but then no significance on the non-vertebral fractures. Was it a difference in the event rate between those two different types of fractures that you saw in the study? Then my final question is on the safety profile and specifically the osteonecrosis and the atypical fractures. Again, I think it surprised people that there wasn't mention of any confounding factors there. Again, is that simply that you haven't analyzed the patient history to know whether there were any confounding factors that contributed to those incidents? Yeah. Thank you very much, Richard. I'm trying to go through the questions in the sequence that you raised them. I start with your question about the non-vertebral fractures and other secondary fracture endpoints. You're absolutely right. As I had mentioned, the FRAME study, of course, has a long list of additional secondary endpoints, all related to fractures. The statistical testing, as I mentioned, stops formally when you hit a non-significant P value. Of course, then the adjusted P values for multiplicity become non-significant, but you can still look at nominal P values. You can still compare for the individual fractures, whether it's hip fractures, whether it's severe non-vertebral fractures, whatever we have on the list of secondary endpoints, whether there are trends or nominally positive comparisons. All of that looks as expected. We have the hints of efficacy there, but for formal reasons, irrespective of how the nominal P values look like, we cannot claim that there is statistical significance. All of this is in the process of being further analyzed, will be disclosed in the appropriate settings at scientific conferences and in adequate publications. As I said before, nothing what we have seen so far changes the story of romosozumab. You asked about the persuasive P value and how can you achieve this in a population with a low placebo rate of fractures. Thank you for recognizing that, because it's a testimony to the strengths of efficacy that romosozumab brings to the table. Yeah, we have seen a persuasive result with a population where you would not necessarily expect that. It is a testimony to the efficacy that romosozumab brings to the table. Vertebral fractures are the primary endpoint for regulatory reasons because they are the most frequent fractures in osteoporosis. And that's why you have, of course, also in this study, a larger number of vertebral fractures than you have for non-vertebral fractures. And, as I said, the efficacy results that we are seeing are event-driven. And I'd mentioned to you that clinical fractures include non-vertebral fractures plus the symptomatic vertebral fractures. And that shows you that if you add events to the non-vertebral fractures, they become significant. And then your question around the osteonecrosis of the jaw, I start with that. And yes, of course, we have looked in detail at these patients, and of course, there are confounding factors. Both patients had very severe dental issues, non-fitting dentures, periodontitis that was very severe. And so there are confounding factors. None of this precludes that we will be very conservative on the safety side and that we continue to monitor these events carefully. Although, and I'd mentioned that, at this stage, they do not qualify as a safety signal. They are just an observation because they have this low incidence. The same applies for the atypical femoral fracture. Again, atypical femoral fractures can occur without any osteoporosis treatment. But I think it would not be prudent at this stage for us to conclude that this is the right conclusion. We monitor, we have more safety data coming in with every day because patients are exposed in BRIDGE, patients are exposed in the third year of treatment in FRAME, patients are exposed in ARCH. So we continue to collect safety information and are very vigilant there. But if you would ask my safety physician on the project, she would say there is no evidence of a causal relationship, and that's why it's an observation at this stage and not a signal. That's brilliant. Thank you. Thank you. Our next question is from Peter Verdult from Citi. Please go ahead. Yeah, good afternoon, everyone. Peter Verdult, Citi. I'll give Iris a rest for a bit. I've got three questions. Just starting with Detlef. For the past couple of years, you've talked about CVN having a 70 to 75% gross margin. Given the ongoing dynamic sales growth and Cimzia production now having moved in-house, can you just provide an update here? Then I'll wait for the answer, and I'll ask the two questions on Romo. Thanks. I think I always said that it had a higher gross margin than what we were trending at that time, which was 67, 68. As you see, there seems to be something that is making a difference when you are increasing substantially on that portion of the sales. We heard that it's 50% now. We hear, and that is good news, too, that Keppra is still a significant product because we know that the margin is good. These compounding factors lead to gross margin increase, and I expect, based on the guidance we have given for next year, that there will be a continued gross margin increase in our 2016 numbers. On to Iris, just two questions. Not asking you to reveal any incremental data, but I would like to have two clarifications. Based on the publicly available FRAME data, how would you be seeking to position and price RoMO given the apparent lack of non-vertebral fracture risk reduction? Just to push on what Nick was talking about, is it fair to conclude that the probability of a delay to the U.S. filing until you see ARCH has gone up? That's question number one. Question number two, you've mentioned that you started sub-analysis. Clearly, hip fracture is probably the most important one that you're going to be interested in. I'm assuming you looked at that first. I realize you're not going to share any of the data, but can you clarify whether the potential to show trends or significance on those individual NVF endpoints is still on the table as we look ahead to ASBMR? Thank you. First of all, on the positioning and pricing, it's a very premature question, which I will not answer because as we had discussed many times, we first need to understand the data. We need to complete our pre-specified analysis. There will be data-driven analyses. Once we understand the value of what we hold in our hands, we'll have all of the appropriate positioning and pricing conversations. Again, on the U.S. filing, I cannot say more than I've said before. We will complete the analysis. We will, together with our partner Amgen, talk to the authorities, and at this stage, our submission plan for the end of the year in the U.S. is unchanged. Peter, I also can't go any further on the secondary endpoints than I've mentioned before. Hip fractures are, of course, a secondary endpoint. I think I've indicated that we see the right trends in the secondary endpoints. FRAME was never powered and never intended to have positive hip fracture claim type of results. Again, as I said before, the secondary endpoints all goes in the right direction, and it's a question of events. It's not a question of efficacy based on what we have seen so far. Thank you. Thank you. We have a next question from Peter Welford from Jefferies. Please go ahead. Hi. Yes, thanks for taking my questions. A couple, I guess, let me start with Detlef. Just with regards to the net debt EBITDA ratio. I appreciate the hybrid that's due, but beyond that as well, are there any other significant CapEx programs that we should be considering or any investments you need? I guess related to that, are there any investments for romosozumab manufacturing or related that you need to consider? I guess I'm just considering how we should look at the cash forecast over the next few years to that target. Perhaps I'll come back with the Romo questions in a minute. Yeah, that is a good question. If we are just staying with what I would say the maintenance CapEx, I would go with 150 million plus minus a bit. We are seeing solid growth, especially also with Cimzia. That could, at a certain moment in time, mean that we would like to increase our share of the manufacturing that we are doing there, but that is premature today, but it could be something to come. I'm not foreseeing anything at this moment in time for manufacturing of other products that we would have to put into the books. It's only the question whether we have investments into products, technologies or whatever you could think about, but that is so event-driven that it's difficult to guide upon. Okay, that's great. then just moving on to romosozumab, it's just two questions. Firstly, just with regards to the ARCH study. I think you mentioned that last study was event-driven in that you've enrolled obviously patients as well with a lower bone mineral density and higher risk of fractures. I believe that the endpoint is defined as that at 24 months. I guess, can you just sort of explain the risks here with regards to obviously patients are getting healthier, patients may already have been on background therapy. How do you control that the event rate will be sufficient in ARCH so that by the 24-month time point, sufficient events have occurred? secondly, related to Romo, given obviously the data you've seen in FRAME, at what point in time, or have you already sat down with Amgen, to determine the best marketing strategy? at what time do you start investing in your sales and marketing plans for Romo? Thank you. Yeah, thank you very much, Peter. on the ARCH study, I think there's not much to add to what I said before. The inclusion and exclusion criteria for ARCH are different from FRAME. In FRAME, the inclusion and exclusion was based on bone mineral density, and patients could only be enrolled if they had not too severe and not too frequent vertebral fractures. In ARCH, it's very different. In ARCH, it's a low bone mineral density plus fractures. again, we are going for a higher risk population because you all know that patients who have just experienced a fracture are at a relatively high risk of experiencing a next fracture. a very different population. Therefore, we have a different, of course, model for the underlying expected fracture rate. on the marketing strategy, the same applies. That applies for pricing and positioning. Please give us the time to understand the data. Please give us the time to analyze and to truly understand what's the value to patients that we can deliver, and then we'll move into the next stages. just to add on that, Peter, you're absolutely right. We will, of course, we'll do that with our partner, Amgen, and we have a very regular meeting with them. The teams are working really together, so it's a joint effort, and it's a joint recommendation that we will have. from that standpoint, and this is the real spirit of this partnership, it's not really Amgen or UCB. It's really a joint team working together to define what is the best for Romo. Sorry, can I just follow up there? Does the contract pre-specify commitments and, I guess geographical regions or target populations or physicians for the two companies? I guess I'm thinking particularly given obviously Amgen is already present in this market. Or is everything basically still to be negotiated and determined by a joint committee once the phase III results have been obtained? Thank you. yes, you're right. There is a contract, and so the contract is the base, and then there is the definition of what we will define as best for Romo. it's not because there is a contract that we have to apply each line of the contract. we are working together to define what is best for Romo, and so that's the reason why I cannot comment furthermore on who will do what for what country. That's great. Thank you. Thank you. We have a next question from Jo Walton from Credit Suisse. Please go ahead. Thank you. I think I'll take the prize for not having a ROMO question here, but I do have three others. Looking at your 2016 guidance, the sales expectations are broadly in line with where the consensus is, but your expectations for profit are significantly higher. Looking at what we collectively have published, which is the line item that we have got wrong? I'm assuming it isn't R&D, because you've explicitly guided that that will continue to rise. Along the same veins, I wonder if you could just discuss some of the pushes and pulls on your 2016 performance. I note that in 2015, two-thirds of the core EPS growth came from foreign exchange gains. Going through, looking at 2016, I know you won't give us very specific elements here, but should we assume that you have got a significant tailwind of foreign exchange within your guidance? Could you also tell us a little bit about what you're thinking about the current shortages for products in the U.S.? You obviously did extremely well with Keppra in the second half of the year with continued wholesaler or generic shortages. Are you assuming that that will continue in 2016? And a final question on Cimzia, please. Looking at the slide where you give us excellent long-term data on market share, we do see that there is a turn downwards recently in U.S. market share. I wonder if you could discuss what the factors are there. And from a European perspective, it's clear that generic or biosimilar Remicade is having no impact on your business. Would you expect biosimilar Enbrel to be similarly benign? Thank you. Why don't I start? First of all, to the 2016 guidance, let's talk briefly about revenue. I think your observation is entirely correct, that this is probably the line that was closest to what we had seen in forward-looking consensus. I think what might not have been in the minds of all of you, because it's not as visible to you, that we have sold products. Which does mean on your basis, you would very likely have to deduct first, and that would bring it down. Just giving you an idea, we sold probably EUR 50 million in revenue in products this year that you would not see again. So then you would drop to the lower end of our guidance corridor, and that explains perhaps a bit more and makes also that correlation to profitability a bit more obvious. I think in a lot of regards, when we are looking into this, I'm not sure that you are commonly wrong on any line. Because there is assumptions that come together that you do as well as we. We might only know a bit more in detail because we are closer to the topic. What we are seeing is scaling, and we see an effect that is going forward also impacting both the gross margin, because of the more importance of our core products for our entire portfolio. We see the scaling effects in some of the lines, and the most obvious ones are marketing and selling and G&A. Even with what we are guiding, this is a corridor that we are taking on, and we take the best. As you know us, we take the best approach and sticking with flexibility and making sure that if each of these lines are moving a little bit in the directions, that overall we are in a manageable situation. That is what we have shown in the past. That is what we think is in the future. I don't think that there is major shortfalls on the lines. I have to also admit that I'm not reading all of the lines. I'm focusing so much on my lines so that I make the numbers. I think this is the easiest way to think about. Stay with the common sense. We have told you these products will have more gross margin. The overall size of the company is going up. Scaling effects will help on the cost, and I think you are there. In terms of the shortages, I can take that. We are always taking an approach that is realistic. We are not putting a tremendous impact on these things. We are having some forward-looking information that we take into consideration. Our results are not dependent on whether we see this continuing throughout the year or a bit shorter. Michel. Thank you for the questions on Cimzia. Let me take the first one, which was related to the rolling three-month evolution of the rheumatology market share in the U.S. I wouldn't read too much into that one data point. Our sales in the U.S. are 75% prefilled syringe, 25% lyophilized formulation. What is reported here is prefilled syringe data. It's happened before that the product went through a dip. It's not consistent with what we have seen during those last few months of the year in terms of our ex-factory sales. In terms of the European question and biosimilars. Indeed, the infliximab biosimilar hasn't encroached on Cimzia sales or growth last year. As you remember, we mentioned two reasons for that. The first one is that it's an infused product. The second one is that it's a product which is very popular in Crohn's disease and in rheumatology. It's perhaps become less popular now in subcut agents have a very, very high market share. That is, of course, not true with etanercept, so your question is good. With those two biosimilars, we see a little bit of pressure on price. With etanercept, I think that we're going to be in a situation where our growth rate would be a few % lower than in volume than if etanercept biosimilar would not have been there. Again, in many markets, there's a fight for stable patients as well. I think that's been the insight of last year, is that, in Northern Europe, some payers and physicians have been prepared to switch stable Enbrel patients. This, of course, is something that doesn't affect Cimzia per se. Just realized that I missed out on answering the FX impact question. I don't foresee any major FX impact on our guidance, just due to the fact that we are hedging quite a bit. As long as we are not seeing extreme scenarios which will bring much more worse problems to all of us, I don't think that we have to be concerned about FX for this guidance. Thank you. Thank you. We will have our last question over the phone from Simon Baker from Exane. Please go ahead. Thank you very much for taking my question. Three actually, please. Firstly, on the profit attributable to non-controlling interest. We saw a big move there from -10 to +51. I was wondering, Detlef, if you could give us any color on whether that was an anomaly or a rebasing of that line going forward. Moving on to some products. On Briviact, I noticed there was a law change earlier this month in the U.S., under which the time spent on DEA scheduling is now eligible to be added back when considering your patent term restoration. I just wanted to confirm that does indeed apply to Briviact, so you could get slightly more patent term restoration than we previously thought. Finally on Cimzia, and broadening out from the question that Jo asked, does the relatively enthusiastic reception of Celltrion's biosimilar Remicade change your overall view on the U.S. both regulatory and commercial attitude towards biosimilars going forward? I was wondering if that's made any impact on your view for Cimzia going forward as we start to see biosimilars in the U.S. market. Thanks so much. Perhaps I can start on the non-controlling interest number. This is mainly influenced on some changes of the accounting. We believe from what we see, as you know, all of these have to do with our project financing initiatives that we had in the past. With the changes of accounting, that has to be put into different lines. We have done that, and there's some volatility in these numbers. When we look at the numbers of this year, we think that we see some sliding numbers, at least for the coming year. Thank you for your question on Briviact. No, there's no additional IP or patent extension associated with any type of delay in the DEA scheduling. In fact, maybe you could make the argument that's why legislation was passed, because people were losing IP length. The bottom line is we're looking forward to the DEA scheduling so we can launch and, once again, no IP extension. on the Remicade biosimilar in the U.S., overall, the evolution is in line with what we have modeled for those drugs. Remicade, the advisory committee was delayed. compared to guidance given in the past, I think we're seeing an entry that is potentially delayed a bit compared to what could have been the case. It's also clear from the AbbVie Q3 strategic review that it could take a little bit longer for adalimumab biosimilars to hit the U.S. market. I think these things essentially will cancel out. To me, the big news is indeed that the readiness to consider extrapolation to IBD indications seems to be there now, which was not necessarily clear last year. if that is the case, then this could have a small impact. again, looking at the total picture of biosimilars in the TNF market, a few years ago, we had the Enbrel submarine patent prolonging the exclusivity potentially to 2028. We've had AbbVie's guidance, and now of course, Remicade could come a little closer than 2018. I think that's largely within what we were expecting in an aggregated basis. Okay, thanks so much. can we have the last question in the room from Cominghome Yan? Thank you very much. Thank you. Jan Kapel from KBC Securities. Three questions. Jeff, one for you to start with. Could you help us understanding a little bit how you're going to position Briviact? Of course, it has the same mode of action as Keppra, so I assume that people on Keppra, it's not going to be the ideal add-on, but just educate us on that, and also versus Vimpat. As a 1b question for you, can you help us understand why this product may not become a blockbuster? Because we are not hearing any signals from the company in that direction. If that's true, please help us understand. Second question, I have to ask a RoMO question, obviously. You said that bone was being made. Can you help us understand where that bone is being made? Is there a difference between the cortical bone or the trabecular mesh where bone is being made? If so, if there is a difference, what would be the benefit of romosozumab in building one or the other part better from a clinical perspective? And then thirdly, Jean-Christophe, because you have not received a question yet. By early in the next decade, Cimzia, Vimpat, and Neupro will have over 3 billion, hopefully, and then a little bit later on, it will go off patent. This 3 billion is the current product portfolio where RoMO and Briviact will be key players, I hope. Is that current portfolio sufficient to compensate for Cimzia, Vimpat, Neupro going off patent? And do you need additional products from outside of the company to compensate for that? Thank you. Thank you for your question. Looking at Briviact, once again, we think it uniquely differentiates itself with no titration needed in a therapeutic dose on day one. And although it's in the racetam family, slight differences in molecular structure prompt tremendous differences in the way the product provides efficacy and the safety profile. So once again, we are leaning on this platform of uncompromising strength associated with immediate control and clarity of response, and we think this is very unique. And so that is the way we'll position it. Once again, in the U.S., with Vimpat having a monotherapy, it is a perfect add-on. We look forward to the monotherapy in Europe, perhaps next year, for that add-on will be there as well. But Briviact is a wonderful, very potent medication with a wonderful safety profile that will help those patients who need to know. Looking at the blockbuster, it's just so early, right? It's hard to predict trend lines and net sales, peak year sales. And we look at recent launches in the epilepsy category, as well as other small molecule launches for that matter. And in this world, this very unique platform of changes in the ecosystem of care and healthcare reform, it's very difficult. So I'll keep my fingers crossed that it's a blockbuster, but at this point in time, it's just much too early to tell trend lines and where we'll be with the product. Yeah, maybe just to build on that, you remember that we used to communicate a little bit on the potential peak sales or goals of sales a little bit after the product has been launched, so you can get some type of data points to validate the trends so we can be more accurate. Yeah, I continue with the romosozumab question. The efficacy of romosozumab is on trabecular bone as well as on cortical bone. We know this from all of the non-clinical work that has been done so far. To the extent we have seen the bone biopsies, this is confirmed. It's really on both. Thank you. Of course, I can build on what Iris just mentioned, because in a sense, this positive phase III result on romosozumab, when I look at the sustainability of the company for the long run, will play a significant role. You're absolutely right. We are looking at the sustainability of the org, of the company for the long run. We are very pleased with the late-stage product now that have been confirmed. So Briviact hit the market. We will see what the trends means. And we are very pleased with the confirmation of ROMO that we have with this first phase III. Now, having said that, maybe two points to further answer your question. The first one is there is a phasing into the patent expirations coming in, right? So we have 2021 Neupro, 2022 Vimpat, and 2024 Cimzia. If you have to think about when we will have to absorb that, first, there is in a sense, a nice phasing. So the bigger product, if I may say, will lose its patents the last one. And the second is, of course, the magnitude or the speed by which we will be able to continue to develop our early pipeline. So we will continue to monitor that, taking the early decision as soon as possible to see what product can be accelerated and what products can or need to be stopped. And based on that, we will either invest even more in some or look for outside early-stage opportunity. In a sense, the Neuropore partnership of last year is a good illustration of that, right? It's a bet for disease-modifying. We have a relatively good scientific hypothesis there, and if it can be confirmed that it will continue our presence in Parkinson's disease, and we will do that in immunology. For the time being, with the latest news that we have, we are very confident that we will be able to continue to grow even furthermore after these three products. Thank you. Yeah. Thank you very much. This concludes our meeting this year. Thanks for being here, and please see you again in a half year's time, and have a wonderful weekend. Thank you very much