AstraZeneca PLC (LON:AZN)

AGM 2019

← View all transcripts

Apr 26, 2019

Good afternoon, ladies and gentlemen. Welcome to the Annual General Meeting of AstraZeneca. Thank you for joining us today, and thank you for having a cup of coffee with members of the Board before the meeting. In addition to those of you in the room, we're joined by those viewing the meeting online as we are also again webcasting this AGM. May I introduce my colleagues on the Board. From here on my left, we have Tony Mok, we have Marcus Wallenberg, Nazneen Rahman, Graham Chipchase our Company Secretary, Adrian Kemp then Pascal Soriot, CEO Mark Donahue. We have Philip Broadley. We have Rudy Markham, Deborah DiSanso and Sherry McCoy. And then we also have on the board Genevieve Bessier, who unfortunately has fever and could not join us today. To begin this afternoon, I'd like to welcome Professor Tony Mok to his first AGM. Tony joined the board in January and sits on our Science Committee. He's an internationally recognized leading clinical oncologist and a world renowned expert, sorry, exporter actually also from Hong Kong, From Imprecision Medicine for Lung Cancer. He's the LiShu Fund, and I think I got that reasonably right. LiShu Fund Medical Foundation Endowed Professor and Chairman of the Department of Clinical Oncology at the Chinese University of Hong Kong. Today, we say farewell to Rudy Markham, who stands down after 10.5 years on the Board. Rudy has been an exceptional Director, laterally acting also as our Senior Independent Non Executive Director and Chairing the Audit Committee. Rudy brought significant international business and financial experience to the Board and has made an immense contribution over the years, bringing an independence of thought, intellectual rigor and challenge to our liberations from which we all have benefited. Rudy, we will miss you, your camaraderie and your wise counsel. Thank you. I couldn't let this afternoon pass without acknowledging Marcus Wallenberg's forthcoming 30 years anniversary as a Board member of AstraZeneca and of Astra before that. Having been appointed as a Director in May 1989, Such a long tenure for a non executive director is rare and it is the primary reason along with his family connections with our shareholder Investor AB is not considered independent by the Board. However, this very longevity in itself is also great strength as it provides deep experience of the company, its history and development and continuity. Those who know and work with him can also vouch for Marcus' passion for science and interest in R and D, as well as the commercial side of the business. Marcus, we thank you for your long service. Marcus' presence here today is also linked to the merger of Astra and Seneca, which took place 20 years ago in April 1999 to form 1 of the largest pharmaceutical companies in the world. Both companies had proud histories of their own, Astra in Sweden and Seneca ICI before that in the UK. However, what AstraZeneca has achieved as a single company has been remarkable. In the years since the merger, we've met and overcome patent and market challenges. We've welcomed many colleagues from other companies such as MedImmune to the team. Most importantly of all, we've delivered many new medicines to patients that make a great difference to lives. We've also established one of the strongest pipelines in the pharmaceutical industry. However, before we look ahead, we would do well to pause and take stock of what we achieved last year. After the previous 6 years in which revenues had fallen more than 1 third, as some of our most successful medicines lost patent exclusivity, we turned the corner in 2018 and returned to product sales growth. It's a trend that I am pleased to say we saw continue and strengthen in the Q1 Q1 2019, as was released this morning. While this success is down to the efforts of the whole team at AstraZeneca, I'd like to highlight the role played by our CEO, Pascal Soriot, in leading the changes that were needed to bring about that success. As you'll recall, Pascal joined the company in October 2012, and in March the following year, we announced our strategy how to return AstraZeneca to growth. That strategy has worked well. Throughout the intervening years, Pascal expertly and passionately led the company on his journey. His belief in AstraZeneca, its science and its people have been an inspiration to everyone in the company, as well as those outside who have met him. On your behalf, I'd like to thank Pascal for what he has done, continues to do, and I hope will continue to do in years ahead. One constant since the merger of Astra and Seneca, and even more so since Pascal joined, has been the speed of change. I can't recall a time when the world around us has been changing more rapidly. I witnessed this at first hand this spring when I attended again this year's China Development Forum and the Boao Forum in Asia. I was able to see for myself and share with others the successes of our China Commercial Innovation Center in Wuxi, outside of Shanghai. Center is accelerating innovation and creating an ecosystem that facilitates collaboration with many different partners across technology and healthcare. Let me say, I'm also impressed by the reform agenda the Chinese are putting in place when it comes to healthcare. And I'm convinced that continuing on that path will positively impact AstraZeneca's growth strategy in the country. Closer to home, I've also witnessed everything AstraZeneca is doing to ensure that whatever happens with Brexit, we will always put patience first. We have been preparing for no deal Brexit since the UK referendum, and our focus has always been to safeguard the supply of today's medicines and also the scientific collaboration beyond the discovery of tomorrow's medicines. We have urged the UK government and the EU to agree a transition period and negotiate a future long term relationship, which aligns closely on medicines regulation and delivery and delivers frictionless trade as well as ensuring free movement of skilled people and continued EU U. K. Scientific collaboration. Unprecedented change is also taking place in the U. S. Healthcare system, where we see an opportunity to shape the future of healthcare. As you may have seen, Pascal recently testified before U. S. Congressional Committee along with 6 other companies. We value that opportunity to participate directly in this important conversation where we shared several proposed solutions to addressing patients' access and affordability in the U. S, while continuing to support scientific innovation. We'll continue to work with the administration and others to ensure patients in the U. S. Have access to medicines they need. As I say, change is constant, and as we look around us, we see a whole world that is changing and several trends that will impact the future of our company. This includes science, where we are seeing enormous advances with new scientific modalities, new technologies and especially new biology emerging. Society is also changing. As we have seen in the U. S, countries around the world are becoming more challenging about the price of medicine. Pricing, as you know, reflects the investments and risk that we are taking as an industry, but patients have different expectations today, and those expectations are growing rapidly. In addition, and that's important, the world is seeing aging populations, and workforces are nowadays made up of more generations than ever before. In other changes, we see patients increasingly wanting to take control of their health, to be informed, to be part of the decision making process, and to be part of managing their own disease. Lastly, digital technology is permeating everything we do, especially in the areas of artificial intelligence, big data, and with that basic research. It's the companies who can take advantage of these changes that are going to be the successful companies of tomorrow. AstraZeneca fully intends to be one of those companies. It's why the focus of much of our annual strategy review this year has been on the potential impact of these trends and how we might respond to those trends. Ladies and gentlemen, 2018 was a successful year for AstraZeneca, 2019 promises to build on that success. I'd now like to hand over to Pascal and invite him to review the foundations of that success and how we intend to build on them as we chart the next stage in our strategic journey. Thank you. Thank you, Les, and good afternoon, everybody, and thank you for being here. I see we have a full room, and it's always exciting to be here and reporting back to you. But this year is a special year. Those of us who understand well the industry, biology and innovation in Pharmaceuticals know that our industry is made of very long cycles, and it takes a long time to rebuild your pipeline and rebuild your scientific fundamentals. And so we've been doing this over the last 5 years, and we're finally launching new products and moving into a new phase of our company. And I will share a few remarks on this in the next few minutes. But before I do this, I really wanted to, first of all, thank you, Leif, for recognizing our efforts over the last few years. But I would like to thank our colleagues around the world because we have 60,000 colleagues working across the various parts of our organization in many countries. And without their commitment, without their passion and their hard work, we would not be where we are today. So that would be impossible. I would like to thank the leadership team of this company, in particular, Maude Dunoyer, our CFO, who's been a fantastic partner and really has helped us get to where we are. I also want to thank the board because without the board commitment and enduring support, again, it would have been impossible to do what we did. And finally and importantly, I would like to thank you all, our shareholders, because clearly, you had to be patient. We all have to be patient in this industry, and you have to provide support and patience over the last few years. But I think hopefully, you will recognize, you will agree with me that this patient is about to be rewarded because we're moving into a different phase. And I will start with this graph, which we all like to look at AstraZeneca. And in fact, as you know, we have been experiencing sales decline for many years. In fact, some of our colleagues who have been with the company longer than I did remind me each time I show this graph that we've actually declined since 2010. The last year of sales growth was 2,009. And the 2014 growth you see here was a sort of a mechanical effect of acquiring the other half of the diabetes alliance from our partners at BMS, but other than that, we would have declined. And finally, we started moving into growth mode at the end of last year. We always said 2018 is a pivotal year. We returned to growth, and we did this. And importantly, as you can see, this is reconfirmed in Q1. The Q1 results actually were very strong. Our sales grew by 14%. In fact, as you know, we've been divesting products that are not core, and we've been really focusing the organization to what is core to the organization. And so if I correct for those divestments, our growth rate would have been 21%, not 14%. But certainly, 14% reflects a very, very strong momentum from all parts of our company. Importantly, this growth is driven by our new products. And every new product is contributing to the additional sales that we are now reporting. Last year, we grew by we grew new products by $2,800,000,000 And in the Q1 of this year, these new products contributing contributed almost $1,000,000,000 in additional sales. And some are bigger, like Tagrisso, because we suddenly had a very, very rapid ramp up of use, in particular in the United States and Japan. Europe, as always, is a bit behind because reimbursement and access takes longer. We also launched in China. So very strong momentum for Tagrisso for the treatment of EGFR mutated lung cancer. Imfinzi is also doing very well, essentially so far still driven by the U. S. And Japan. We're starting to launch in Europe, and so there's more growth to come. And as you can see here, many other products contributed to this very strong growth in the Q1 of this year and last year. So and there's more to come. If I look at the Q1, overall, our sales grew by 14%. And the important message for you here today is that this is a very this is a growth that is widespread across the 3 therapy areas we focus on. Of course, very much driven by oncology, which grew by 59% and represented for Q1 35%, about onethree of our global sales, so very, very strong contribution. But it goes beyond oncology, Cardiovascular, metabolism and kidney disease grew by 19% and represent about 20% of our total sales. Respiratory the respiratory therapy area grew by 14%. And now you see others here declining by 21%. And that, of course, reflects the declining sales coming from patent expiries, the tail end of those patent expiries, but also the effect of divestments. And now if I actually was to show you here what I might call other non emerging markets because these other products, older products in the emerging negative effect, the headwinds in the emerging markets, the So in fact, the negative effect, the headwinds that we're experiencing from this patent expiry is starting to decline. And so we should be expecting very strong growth as we move forward. Emerging markets, we experienced a 22% growth rate. It is a historical growth rate. We've never experienced 22% growth in the emerging markets. So China grew by 28%, and it represents almost a quarter of our global sales today, which shows you that geographically, we are very well dispersed around the world. But also beyond China, the growth was well represented across all emerging markets. So really a very nice start to the year from a sales viewpoint. And we continue to make progress as far as science and rebuilding our pipeline. If you go back to 2012, 2014 or so, as you can see here, we had like 5 to 6 projects in our late stage pipeline. Last year, we had 28. It really shows you the enormous productivity improvement that we've been able to make in R and D. Of course, our R and D budget has grown, but the growth in number of projects is disproportionate to the and the increase in R and D investments. So our productivity is certainly one of the best in the industry. We now have 28 late stage projects. And importantly, last year, we had 3 breakthrough therapy designations. And the breakthrough therapy designations reflect the innovativeness of a new compound and the importance that the FDA sees in this new product and the importance of bringing that new product to patients as rapidly as possible. We had 6 Orphan Drug Designations and 7 Priority Review Designations. And I can I could spend more time talking to you about the progress we've made in the number of publications in high impact scientific journals? We went from 5 or so publications back in 2012 to about 100 last year. So in terms of scientific publications in some of the best high impact scientific journals, we are on par with some of the best companies in the industry, even though our budget R and D budget is smaller. So good progress on that viewpoint. So let me move on now to talking a little bit about the future. First of all, I think it's important to keep in mind that our strategy remains unchanged. And the fundamentals of the strategy are the same as we've described before. First of all, we are Sands focused. In our industry, it's very simple. You've got to innovate, and you have to come up with new products. Now the difficulty is actually not that. The difficulty is to execute on this and to do it successfully, of course. But if you're not science focused, if you don't follow the science, there's no chance of success. So science is key. Number 2, we want to stay focused on what we believe we do well, which is oncology, cancer research, cardiovascular, renal and metabolism and respiratory disease. There are many, many unmet needs in the world, but I do believe that you really need to stick to what you do well. And other companies can take care of other aspects of medicine. And in fact, we never have enough resource, never have enough R and D budget to cover even the 3 areas we focus on. And by the way, those 3 disease areas are the biggest killers in the world. Cardiovascular disease remains the biggest killer in the world. Cancer is the other one. And the third one is respiratory disease. I think people don't really necessarily realize that asthma and COPD kill people. Severe acute exacerbations of asthma take people to hospital and often kills them. So there are a lot of unmet needs in those three therapy areas. The third aspect of our strategy is we want to be a global company with a presence across the world, not only in the U. S, like some companies decide to do, but in Europe, of course, in Japan and in the emerging markets. We want to serve every patient around the world to the extent we can. And in particular, this has led us to invest in China very consistently over the last 5 years and to deliver the results we've delivered in China last year in this Q1, we are number 1 or number 2 in China, depending on the quarter. So clearly, a great result by our team in this country. And finally, we don't want to be specialized in specialty care only. We want to cover the needs of patients in primary care, primary care physicians, general practitioners, but also in specialty care, of course. So net net, what that means is we have a company that is you have a company that is well balanced between Specialty Care and Primary Care, but also across the entire world. So what that means is we are less exposed to changes that could dramatic changes that could affect a country or a therapy area. We're much more diversified and much more stable and less exposed to risks, if you want. On the other hand, it also means that our profitability levels will not be that of a specialty care company that would focus on the U. S. Market, of course. We are targeting a profitability that is comparable to companies that have similar portfolios like Novartis and some others. But those four aspects are fundamentally unchanged. Having said that, the world is changing, and Leif mentioned that a few minutes ago, and we cannot stand still. We have constantly adjust. And last year, we spent a fair amount of time thinking about how do we shape our journey for the next few years? And what kind of company do we want to be by 2025? We called it AZ 2025. And what are trends that we need to tackle to really be a leader, continue to be a leader in our industry by then. Number 1, innovative science. That will not surprise you. But what is important to know is that technologies there are many, many technologies that are emerging, and science is moving at light speed. And what is really key for us as a company and as an industry is really to select carefully the new science, the new technologies that will shape the future of our industry. 2 is, we need to be even more patient centric than we have been in the past. And also, we need to come up with new models to price our products. The past has been about selling a pill or selling a vial. We need to move on from this and look at being part of the solution of reducing health care costs as opposed to being part of the problem today. And I'll give you an example. For instance, we have a product called FarCigard, as you know, for the treatment of diabetes. If you look at FarCigard just to reduce glucose in your blood and treat your glucose levels, you might conclude this is an expensive product. Now if you look at Farseegar in the context of the recent data we've been presenting that reduce this product reduces heart failure and reduces hospitalization for heart failure, stop patients from going to hospital, also reduces the kidney disease. You can immediately see that we stop patients from going to hospital and we can reduce the totality of cost. So clearly, what we need to do is engage with Payeur on value based what we call value based pricing, which is committing to results, committing to reducing costs, health care costs and pricing our products on that basis. And finally, we have to embrace digital. Digital is changing the world, and it really is changing the way we have to conduct our business, if you will, not only in our factories, where, of course, the smart factory is the way of the future, not only in the way we run our back office, but also the way we do research. How do we manage big data? And how do we use artificial intelligence to generate better targets and new products? How do we use devices, digital technologies to develop our products? How do we merge digital technologies and new products to deliver health care to patients in a better, more efficient manner? So those are the three trends that we decided we wanted to integrate in our strategies. And we evolved our 3 strategic priorities in a way that remain consistent with the past, but with a different focus. We don't focus on now returning to growth, but we focus on delivering this growth. And when I say growth, I don't mean only top line growth, but we now have to turn this sales growth into profitability improvement, cash flow improvement and deliver on our commitments to you, our shareholders. And that's what we will certainly focus on over the next couple of years and build our therapy area leadership. We want to be a leader in each of our therapy areas by 2025. The next priority is how do we accelerate innovative science? How do we move some of the projects we have in our mid stage pipeline into late stage? And how do we tackle some of these new technologies that will shape the future of the industry? And finally, an important priority is how do we continue building this company as a great place to work and an even greater place to work. Culture is fundamentally what actually drives the success of an organization. So if I spend a few minutes on the mid stage pipeline, there are many, many projects here, so I won't go through each of those. But maybe a couple of messages. First of all, I want to make you confident that we have not only a late stage pipeline that is rich, but also a mid stage pipeline Phase onetwo that is very good. And what we are doing now is focusing on selecting some of those projects and moving them into Phase III. And you can see here, there's a couple of projects in oncology that are moving into Phase III. There is one project in respiratory disease, PT027, that is in Phase III. And then we have many mid stage projects there. And some of those will be prioritized to move into Phase 3. Essentially, we reorganized late last year, early this year, to ensure that we could continue developing products, moving them from research to the market very quickly and in a very agile and entrepreneurial manner and to increase our focus on oncology on the one hand and on cardiovascular and respiratory on the other hand. So we do have an early mid stage pipeline that is very good. But we also said that we would remain opportunistic and then open to the idea of complementing our pipeline with external opportunities that make sense to consider. And when I say make sense, I mean opportunities that are strategically aligned with what we're trying to do in cancer or respiratory or cardiovascular disease. Opportunities that we can add value to is there because of our expertise in cancer, for instance, or because of our geographical footprint. And this product, trastuzumab deruxtecan, actually fits the bill completely. This is an agent that was developed by discovered and developed by Daichi Sankyo, which is potentially going to transform the way breast cancer is treated but also potentially other tumor types. And it's addressing a so called HER2 mutation. Today, patients with breast cancer who are HER2 mutated breast cancer patients are treated with a product called Herceptin. There's another one called Perjeta and a third one called TDM1 for more advanced form of HER2 breast cancer. Collectively, those three products represent about $11,000,000,000 of sales annually. But actually, what they do is, you can see on this green part, if you look at the first bigger bar here that represent breast cancer, the bottom part is in green and that represents the patients who are HER2 positive. Now, only 20 percent of patients are HER2 positive. So there's another 60% who are HER2 so called low. So that mutation is it has a low level in the tissue. And there is another 20% that is HER20. The potential of this agent is to treat patients in the HER2 positive setting better than existing therapy by removing the use of chemotherapy. You know that, of course, chemotherapy is very toxic and patients experience side effects, hair loss, etcetera, that are certainly very difficult to live with, this agent potentially could treat patients without the need to use chemotherapy. More importantly, it could be used in HER2 low, which is a group of patients which is 3 times as big as the HER2 high breast cancer group. So it gives you right there an idea of how big this agent could be. But beyond that, we can also explore other tumor types, gastric cancer, potentially also some forms of lung cancer. So an enormous potential that we will be exploring together with our colleagues at Daiichi, thank you, over the next few months years. So this is the mid stage pipeline. But I've also told you, we're spending a lot of time thinking about the long term. I mean, we're really focused on the near term, the next 2 years, and that is about delivering top line sales growth, taking this to the bottom line to improve our cash flow so we can sustain our dividend and reinvest in our pipeline. We're looking at the midterm, and the midterm is about moving the mid stage pipeline into late stage and also complementing this with the agent I just talked about. And the third aspect is to think about long term. And that those three time dimensions are dimensions we have to constantly manage. And as it relates to the long term, the question is really what is the next wave of disruptive biology? So some of the things we are looking at are new modalities, as you can see here, like Protax, in vivo biologics or cell therapy. We're losing looking at new technologies and looking at how do we use artificial intelligence and big data and integrate the various omics, being genomics, transcriptomics or some others to actually come up with new targets. And we're also looking at new fields like the microbiome. You may have seen we announced a collaboration with a company based in Boston microbiome on the effectiveness of immuno oncology products in cancer care. And we're also looking at tissue repair. This effort is driven out of our site in Gothenburg in Sweden. So those are some of the new technologies, new metallurgy, new biology that we will be exploring over the next few years. I also said we are working on looking at how do we price our products and how do we work with payers. And essentially, really, it is about managing the totality of health care costs. An example that is listed here relates to Brilinta, our product that is used for patients who've experienced a heart attack. You know very well that if you've had a heart attack, unfortunately, your risk of having a second heart attack is much increased. So essentially, Brelynta is given to patients who have had a heart attack. And when they are discharged from hospital, they receive Brelynta. And Brelynta, I will not say, stop them from having a heart attack but reduces substantially the risk of having a second heart attack. So what we did in the U. S, and we're now expanding this approach to more payers, is we partnered with some payers and we told them, look, we are committing to reducing the percentage of patients who will have a second heart attack after they're discharged from the hospital. And if we don't deliver this, we will give you a rebate. And essentially, it's win win win. The patient wins because if they are well treated, they don't go back to the hospital. Of course, that's the ultimate goal. It's a win for the payer because they can reduce health care costs by reducing hospital costs. And it's a win for us because Brilinta, of course, is used in those patients. This is the kind of example that we want to drive through the market and do more partnership like this. It is easy. In conceptual term, it's hard to implement because it requires payers to have the ability to access the totality of their health care costs. And today, the system the health care system is still fragmented with drug budget managed by a set of people, hospital budget somewhere else, primary care budget somewhere else. And we're making progress in many countries. And suddenly, the NHS and the UK is getting there in terms of getting their arms around the totality of the health care cost and managing those. So this is really the future for the industry and certainly for us. And that's one of the things we're trying to drive in the U. S. Also to manage some of the issues around drug costs. And finally, I've talked about digital and AI. And clearly, again, that is another aspect that will drive the future of our industry. And just like many years ago, we started introducing a policy, if you will, of developing a biomarker with each of our products in development. And today, we have probably in our portfolio 80% to 90% of our new projects that are developed together with the biomarker. We want in the future to develop our products with a digital technology attached to it being a device or some other application. And we are in the early days of this. Our Chinese team in Shanghai is doing a tremendous job merging digital and pharmaceuticals to deliver health care in a better way. But again, this is a multiyear effort, the same as artificial intelligence is a multiyear effort. Finally, we'll continue to work on transforming our culture and working on this great place to work priority. Importantly, we've made tremendous progress around inclusion and diversity. We were included actually, we were the only pharmaceutical company included in the Bloomberg Gender Equality Index this year in 2019. And that reflects there, the Bloomberg assessment of the progress we've made in that area. We have almost 45% of our senior leadership roles that are led by women today, and it's up from a little bit less than 40% in 2012. We're not there where we should be yet. We should be at 50%. We recognize that. We have more work to do. But suddenly, we're moving in the right direction. And also, we have 19% of our senior leadership roles that are in the hands of people coming from Japan or the emerging markets, and it's up from 5% in 2012. And finally, 83% of our people tell us that they consider Izzy a great place to work, that they would recommend to friends or other people as a company to work with. And it's up from 77% in 2014. Now the goal is, of course, to come even closer to 100%, but 83% places us as one of the best companies, not only in the industry, but across industries. So more work to be done there. And suddenly this year, one of our key priorities from a human resource viewpoint is inclusion and diversity. How do we make ourselves a company where diversity is actually part of who we are? We don't do it. We don't focus on it simply because it's the right thing to do, but because everybody values it, everybody understands that's who we are as a company. We are a diverse company. We value that, and people feel included when they come and work for us. And finally, I would say all of these efforts have translated into progress from a total shareholder return viewpoint. And as you can see here, we've been tracking our progress from a TSR viewpoint since 2013, and that is about 100 and 77% total return over the last few years since the beginning of 2013 when we started on this journey. And it places us at the top of the FTSE 100 set of companies and suddenly very well placed as we relate to our peers in the industry. You can see the industry as a whole has done very well too, 128% improvement, but we are above that. And suddenly, we need to continue working hard to deliver even more. Now I want to conclude by going back to the impact we have on medicine because, of course, the sharp price, I do get this every day, but I should not, I know I should not, it's a marker of our success. But I think what really brings us to work every day, all our colleagues around the world, is the impact we have on medicine and patients. And I just want to give you a couple of examples. Of course, we always talk about oncology, but we make an impact elsewhere too. And I wanted to share with you this GINA recommendation guidelines that were just issued a couple of weeks ago on the treatment of asthma. GINA is a global initiative for asthma. It's a global set of guidelines for the treatment of asthma. And actually, today, patients who have mild to moderate asthma are treated by so called Saba. And they actually there is overuse of Saba. And people still experience acute exacerbations of asthma that takes them to hospital and sometimes kill them. And we've demonstrated with Symbicort that using an anti inflammatory in combination with Formoterol actually reduces substantially the acute attacks of asthma and improve the care of mild to moderate patients, not only more advanced asthma patients, but even mild patients. This, for those of you who don't know asthma, you may not realize the importance of those guidance, but those physicians who treat asthma will tell you this is totally transformative for the treatment of asthma. And now as needed, ICS or anti inflammatory with Somoterol is the preferred reliever for those patients at any so called Jena step of the asthma disease. And finally, I want to conclude with a video from a patient, a cancer patient, who has experienced the benefit of one of our product, but importantly also has been in touch with many of our people around the organization, but more recently visited our manufacturing teams in the Northwest and is reporting back on her experience talking to our people and sharing how they are passionate about what they do, whether it is in the research lab, but very importantly, also in our factories and across the entire company. So let me stop here. I would like again to thank you very much for your support and your trust and your patience. And let me finish with sharing this video for you. Thank you so much. We gave up on that. Yes, let's see. That's a pity. Let's see if we can perhaps take that later on in the meeting then. Good. Thank you very much, Pascal. Now let's begin the main business of the meeting. You have all received the notice of this meeting, which was published to shareholders on 14th March 2019, and you have all seen the resolutions that are being proposed. Accordingly, the requisite notice of the meeting has been given. I propose, therefore, that with your consent, the notice of this meeting should be taken as read. Is that agreed? Good. Thank Then if you'd like to ask a question today, please be ready with your questions in a minute. We'd like to take all questions on whatever subject at this point in the meeting. A summary of the resolutions is being displayed now by way of a reminder. There's a question point in the middle, right here, so in the middle of the room. So please go there now if you have a question. Please state your name before asking your question and please keep your questions brief and to the point to allow as many questions as is possible. Good. Let's start with the first question. Thank you, Chairman. My name is Doctor. Basu. I'm a shareholder of AstraZeneca, and I'm a retired medical doctor. I know you have a lot of wonderful products to treat chronic obstructive airways disease, to treat hyperlipidemia, to prevent the complications from cardiovascular events and type 2 diabetes. You have products for the GI tract like LOSEK and influenza vaccine. I want to focus my attention on oncology. I know you are trying, have done a lot of research on immuno oncology to treat lung cancer, ovarian cancer for hematology and breast cancer. If you kindly allow me to take me to 50 years back, I studied, witnessed and participated in many monstrous surgical procedures for patients suffering from dreadful cervical cancer and other genital cancer. Patients not only suffered from this disease, but also suffered from the aftermath of this monstrous operations like Waldheim cysterectomy, radical vulvar vaginectomy and pelvic clearance operations. The surgeons I worked with those days, lot of them are not allied today to see by the simple invention of 1 of the antiviral drug, antiviral, anti HPV vaccine to vaccinate the young girls and offending males to eradicate the cervical and genital cancer and genital warts altogether, especially in the developed countries. Now you are focused on treating lung cancer, breast cancer, ovarian cancer and in hematology. Your aim is to increase the immunity of the tissues, and also you are trying to destroy and disintegrate the cancer cells, DNA of the cancer cells so that they cannot multiply and affect the other tissues. Chairman, patients and public, they are not only interested in getting comfort and getting to see to prevent the progression of the disease, they want you to tell them that that disease is completely curable. Now with breast cancer, unless detected early, we still see the radical mastectomy followed by radiotherapy and chemotherapy unless detected early. Now we know that breast cancer is very often related to the defective genes. And nowadays, to treat a patient, you have to find out the first degree relatives who carries these defective genes. Now your company, even though is doing this research on immuno oncology, is there any scope you hear a lot of gene therapy? You hear a lot, but we don't see in practice that doctors are doing this gene therapy. Now with respect to lung cancer, I attended a meeting of 1 of the big companies yesterday. You will be surprised to know, I was surprised that from smoking related disease in India, there is about 1,000,000 deaths a year. You have a big establishment in Chennai, a 20 story block. I am very grateful to you because India and its patients is not only good for your business, but also is good for your research program. Can you tell me in percentage terms with cancer of the lungs, breast cancer, ovarian cancer and related to hematology, what would be the 5 year survival rate from your therapy? Patients are not interested in 5 year therapy survival. They are interested to live forever and disease to be cured completely. Thank you. Okay. Thank you, doctor. I think in your comments, there was one question about gene therapy in breast cancer, I think. And you citing an awareness of projects, Pascal or Yes. I must say I wasn't sure exactly what your question was. I'm so sorry about this. Sorry, if you could help me with that. Was that a project or was it pain therapy as such? Well, I think maybe the question or your suggestion more than the question was that we should be looking for cure and not extending life. And I would totally agree with that. The problem though is, of course, we would all love to be able to achieve this. But at this stage, the best we can do is extend lives as far as patients concerned with affected with metastatic cancer. So if you, for instance, look at metastatic lung cancer, patients who are diagnosed with metastasis have a so called 5 year survival rate of about 10%, 15% or so. And so with immuno oncology, we improve that, but we don't improve it to 100%. But certainly, our goal is to cure those patients. I think another way to and of course, we can continue doing this, and we're certainly working on doing it by looking at combination of products to further improve the efficacy of our combination regimens. But another way to improve survival or in fact, possibly cure patients is to diagnose them earlier. So you are talking about breast cancer, and breast cancer has made enormous progress because of screening of women and an early diagnosis of breast cancer. The problem with lung cancer is typically when patients are diagnosed, they are well advanced in their disease and there's no good early diagnosis. You'd have to do CT scans, and you can't do CT scans on everybody on a regular basis. It's not cost effective, unfortunately. So what we are doing here is 2 things. 1 is we are developing our immuno oncology products in early stages of disease, in particular lung cancer. So we have a solution for those patients who are diagnosed early. And 2 is we are working on diagnosis diagnostic methodologies and tests to try and diagnose patients at an early stage of lung cancer with a simple blood based test. So you can imagine a day when you would simply do a blood based test, take a blood sample and try to identify patients who have early signs of lung cancer. And then you can actually cure them. You can cure them either through surgery or through surgery and immunotherapy. So those are the kind of things we do. But unfortunately, we're not there yet where we can cure every cancer patient. That's our long term goal, but we're not exactly there. Hopefully, this is addressing your question, but if not, let me know. Good. Thank you. Even though we thank you for your research and achievements, 50 years ago, it would have been a laughable talk to for anybody to say the genital cancer would be completely cured. Now today, we do not know. We are still far away from curing the breast cancer, lung cancer, ovarian cancer and the rest. Anyway, thank you for your thoughts. Good. Thank you, doctor. Thanks for your comment and question. Good. Next comment and question. Good day, Chairman. Robert Muriel. What a splendid presentation for Mr. Soriot. We're lucky to have him as shareholders, very lucky. Now I sense that it's not just luck. It's a question of this fantastic concentration on determination as well to do certain things and not be deviated over the whole 5 years. And although you mentioned drugs and of course it's fantastic, I also admire the way you've managed apparently to complete the provision of a research and development laboratory in Cambridge. And I believe that costs money, but presumably that cost is now more or less away. Well, also we have to be very pleased about the share price and that in spite of, if you look at Page 1 of this annual report, every single financial highlight for the year is down on the year before. It's quite a remarkable achievement on your behalf and thank you for that. But when we come to individual matters, I wonder about the legal proceedings in that sense, the several pages on that. And you say that the legal costs are charged to the profit and loss account as incurred. Well, they're a pain in themselves, but I wonder what the amount of money is that goes on legal costs every year. When it comes to remuneration, here we have 22 pages. It drives me nuts to read them, even look at them. And you're paid a lot of money. And if you're success, you should be paid a lot of money. Mind you, if you double what this company is doing today in 5 years, heaven only knows what happens to your pay. I think if it goes up like that, it'll be beyond BP and Shell and everybody else. And it's quite a problem, this. I mean, you're doing very nicely, thank you. And I think a little moderation might be necessary in the next few years. Anyway, the only thing that I might add is that you have a concentration also in this report on corporate governance. Well, frankly, I find that very boring. But the idea that you've got 5 pages of it, I suppose it's politically correct. Good luck to you. But it would help if you could read it. I would ask you as a Board to look at pages 102103 in the light we've had in this hall up to this minute. They are just about unreadable. It's the print is so small. So I mean cut it out rather than try to give it to us to read in that form. And Mr. Kemp, of course, he keeps talking about the company having a progressive dividend policy. Well, it's amazing that in view of the results that you've had in the last few years, you managed to maintain the dividend. I don't call that progressive, I'm afraid. It's a rather unfortunate word, but I wonder if there will be a time when we could expect something to go up. Thank you. Thank you. A couple of comments and a couple of questions. I think the board would agree with you on the comprehensive nature of the remuneration report. And as you know, that's what's required from us. That's why you have it there. I'm happy that you read it. So that's good. Corporate side, we note your comment on small print there. Progressive dividend, we have defined and have stated publicly, and I've been around for quite a few years now, that progressive dividend in our case means stable or increasing. So far, it's been stable. Hopefully, we will get into a situation where that might be a little less stability there. Legal costs, the So the legal costs are in relation or in comparison to many of our peers are much smaller than in any other companies. Legal costs are composed in 2 types of costs: the cost of the lawyers' employees that work for us, but also we have a settlement or litigation settlements with other parties. And on both counts, I can assure you that AstraZeneca have low cost on the lawyers' cost, but also low cost on the settlement cost. It has not always been the case. You know, earlier on in our history, we had a bit higher cost for settlement. But in the recent past, these costs have been relatively moderate. You don't give it a figure? I will find the figure for you. I will get it. If you don't know it, forget it. Thank you, Mr. Muehrer. Thank you. Thank you. We'll see if Mark can send you a mail there or so. Good. Next. My name is Murtaugh Angeloglou. I'm a retired family doctor and a shareholder. Two points really, and sort of send me 2 questions. The first is Mr. Suarez's comment that you're trying to get more of an influence over or integrate governments with your company so that they the NHS works more closely. And, I, as someone who's worked in the NHS all my life, am concerned about this because I feel pharmaceutical industry has too much control worldwide and especially in the NHS. And there isn't enough room for people's homeostatic mechanism to get better because, as we know, every very potent drug, which AstraZeneca produces many, has many side effects. And interestingly, a few years back, American doctors went on strike for 6 year 6 months 6 weeks, sorry, and the death rate went down because the side effects went down because people couldn't get their drugs. So I'm it's not because I'm against medicine. I have to take a lot myself about various conditions, but, I'm I'm concerned that, there's too much influence. So that that's a comment. I don't know if you want to reply to that comment. And the other, it's a few years, maybe about 6 or 7 years ago, I last came to an AGM and I asked the same question about there are some animal rights demonstrators outside. I'm very concerned about life in general. And I asked then what the company was doing to increase its in vitro experimentation as opposed to in vivo experimentation on animals. And the question I'm going to ask you today is how many primates do you actually use in your laboratories? And what are you doing to, to reduce the the use of animals? Because, yeah, I I I personally don't think it's right, And I think there's always a knock on effect. Human beings are made of atoms, which are made of energy, and we all have an energy field. And this may not sound like, authentic medicine, but it is true. And, we're we're affected by, energy of what goes on around us. And I feel that, a drug is a specific pharmaceutical compound, which is targeted to a particular area of the body, but we have to look at the body as a holistic mechanism and composed of spirit as well as physical and being. And I just feel that it would be ethical if the company took more measures to improve in vitro experimentation and cut down in vivo. So I just wanted your views on that. Thank you. Good. Thank you. I think on the first your first comment, the point that was made was really that if you look at health care altogether, which is really the cost that governments in most countries take, then that should not be seen as silos where you have drugs only, hospitalization, and other effects on society, for example, being out of work. It should be taken into a context and with a whole concept. That requires, frankly, different parts of that whole health care system to work well together. That's the only point we made. And I think that is actually a better way to serve patients for the duress of their disease. On the other side, on the point that you brought up was animal testing, and we where we have Nazneen there. Nazneen, should you talk a little about that? Yes. Thank you for your question. It's a really important area. It's an area that's of great importance to us. We have been substantially reducing the animals that are used in our experiments. I don't know the exact number since the last over 6 years, but I could provide them for you if you wanted that. But they're dramatically reduced. And in particular, over 95% of the animals now are small rodents. And I don't think we use any primates at all. And I totally agree, and we agree as a company, that there are other ways in which one can consider the safety and the efficacy of these drugs, both in vitro when we're using a lot of new cellular models, but also with the advanced computer modeling, there are ways in which we can evaluate things in ways which we weren't even able to do 6 years ago. And we are putting a lot of time, energy, thinking and resources into that. Currently at the time, obviously, we have to ensure that our drugs are safe for humans. And as yet, it's not possible to completely stop using animals, but we share that long term aspiration. And for the animals that we use, there are obviously very strict regulations, but the welfare of those animals, the and the humane treatment of those animals is absolutely paramount. And we audit that and review that very carefully, but it's central to our ethos that we do that. Okay. Thank you. That clears the way for next question. Okay. Thank you, Mr. Chairman. I'm Mila and I work for ASN Bank, the largest sustainable bank of the Netherlands. Our clients invest both for sustainable and financial returns. And they owe a total of, well, a little bit over 380,000 shares of InstroGenica. And on their behalf, we'd like to ask you 3 questions. Health Care belongs to a sustainable society we vision as a bank for 2,050. However, we also see a lot of problems in the pharmaceutical sector. And that's why a couple of years ago, we started a project called Fare Pharma in order to make the pharmaceutical sector more sustainable and therefore for us also investable. Our approach is a positive one. We encourage company encourage companies to copy each other best practices and so improve media sector as a whole. Just as last year, we have a question on voluntary external verification of our company's code of conduct and as well as the product quality and safety. We are pleased to see that AstraZeneca already has a lot of internal programs in place and already partners with external audit experts to order can select the marketing companies. However, what seems to be missing are voluntary external audits both in relation to ethical behavior as well as product safety. Introducing these voluntary robustness of your internal systems. And we also believe that it is better for both patients and the company that you have these voluntary external auditing systems in place before the mandatory external auditing common ground such as the FDA. Therefore, my first question is when will AstraZeneca implement external voluntary verification in both the code of conduct as well as on product quality and safety? Secondly, we have a question on variable remuneration of sales staff. We once again want to propose reducing the variable remuneration of sales staff, which focus on the sales and replacing this by rewarding quality for customers. This contributes on the one hand that patients receive the most appropriate medication. And on the other hand, it also contributes to long term value of the shareholders as controversies will go down. GSK already has such a policy in place, and therefore, we are confident AstraZeneca can do this as well. So my second question is when will AstraZeneca have a remuneration policy for sales safe, which is publicly available and rewarding quality instead of volume. And finally, I'd like to ask you a question on the payments to health care professionals. Of course, we were very pleased last year that AstraZeneca committed to make its payments to HEPs worldwide publicly transparent and not just in countries where this is mandatory by law. As far as we know, AstraZeneca is the 1st country to have such a commitment. However, what remains unclear is in which countries it still needs to be implemented and when AstraZeneca will reach this goals. In your annual report, you report that you have a progressive plan to expand disclosure activities in 6 other markets in several regions in the upcoming 2 years. But for instance, I could not find when you will be trans trans on the payments in China, for instance, a very important country for sales you mentioned earlier. And therefore, we would like to hear your road map towards the goal of full transparency. And we will look forward to your answers, and we hope to have a fruitful dialogue with your company in 2019. Thank you very much. Okay. Pascal, might that be three questions for you there? Yes. Thank you so much for your questions. The first one is the verification. I mean, we undergo external voluntary certification of aspects of our of aspects of our ethical conduct, including the training for the code, the implementation of the code. But we have no plans at this stage to have external auditors looking at the details of our programs. But certainly, we have a current external certification of the training and the code itself. As far as the sales staff, we constantly strive to find the right balance between base pay and variable pay. And we believe our variable pay is completely appropriate as it relates to our sales staff in proportion to their base pay. We train our sales staff to make sure that they promote products in the context of the approved indications. And if we have a good product in an approved indication, it is a good thing for patients to receive it. We are not planning to publish the remuneration policy for our sales staff, but I can assure you that we certainly have very reasonable, very responsible balance between best pay and variable pay. And as it relates to the payments to HCP, we are I think we are planning to file we're right now working on 50 filings around the world. So we could possibly give you the details of the countries where we file, if you wanted to. And we're making progress. I think we have the number of filings this year is larger than last year. But you also have to realize that it is a massive undertaking, and we can only do it country by country. We actually everywhere where legally we have to do it, we do it. But we are already going beyond that. And it requires systems, of course, implemented in the countries, I mean, IT systems to collect the data, to report it and to share it. And we're certainly committed to continuing to do that. And if we can even share the countries where we actually do it, if you're interested, we can do that offline. Okay. Thank you. Okay. Thank you. Good afternoon, Chairman. I'm Keith Lester and a small shareholder. And I've got a really exciting question on the financial accounts statements. On the financial accounts? In financial statements, on Page 150. If we look at the bottom line there, you can see that the total dropped by about £2,000,000,000 Now most of that is probably in the intangible assets, which is the 3rd line down from the top. So we've got a figure there of €21,000,000,000 in goodwill. And if we then go to Page 169, which is Note 9, you can actually see that number at the bottom of the page, which is 21,559. However, looking four lines up, there's a different total for goodwill. There seems to be a difference of $417,000,000 which is not explained, and that is my question. What is the difference? So first, maybe I will try. So first of all, you are right that the amount of that you quoted of $21,559,000,000 is not the goodwill, but the level of intangibles. Intangible assets, yes. Intangible assets. You see it on Page 169 at the bottom of it. And then you said 4 lines above is what you are saying? Yes. That's also intangible assets. So there's a difference of 417,000,000 euros Because you've got cost, amortization, and other value. That's the difference, yes. So I think the difference is the you have the detail is above. You have the cost, historical cost, the amortization and therefore, the net value. The 21,005 42 you see is not the intangible. It's the amortization and impairment losses. So this is the number to deduct from the gross amount of 43.51 dollars you have above. Okay. So there must be an explanation somewhere then within the financial statements of the 417,000,000 pounds I couldn't find it anyway. May I just assist Mark? This is now the Chairman of the Audit Committee. Just to prove that I do read the annual report as Chairman of the Audit Committee. Do you see the first number in bold, 43,501? That's the same column that you were referring us to, about a third of the way down, the cost of the intangibles at 31st December, 14,501. The number the second number you invited us to look at, 21,502, that's the amortization of that, of the cost. So if you subtract $21542 from $43,501,000 you get $21,559,000 which is the total, as you referred us to on the bottom of $169,000,000 If you'd like me to go through it with you afterwards, very happy to do so. I see. Okay. Thank you very much. Okay, good. Thank you. Good. Next question, please. Okay. Since AstraZeneca was founded in 1999, the corporation has had a steady flow of expensive payoffs to the sponsors, shareholders, human patients and animal life with drugs. You promised it would yield positive results, wasting 10 to 15 years of trials and phases when they finally reached human trials Phase 3. Your fails were Considering the free hours, replacement, reduction, refinement, Considering the 3 R's, replacement, reduction, refinement as well as your own, created 5 R's: 1, right target 2, right tissue 3, right safety 4, right patient 5, right commercial. But this not make animal testing with your company obsolete. In 2006, AstraZeneca's NXY059 stroke treatment failed, the Phase III trials after promising results in previous trials. And again, by 2018, Imfinzi fails your lung cancer treatment. Also tremelimumab fails stroke treatment, again, after promising previous trials. Both failed at Phase III trials. Eventually, in 2019, AstraZeneca removed these drugs, again proving that animal testing results when translated into ready for pupil trials are completely irrelevant. As with most pharmaceutical drugs, the majority which get shelved at Phase 3 at great cost to human and animal life, many of which could have been better spent campaigning to change current laws regarding life sciences to progress to human trials without animal testing and install more human relevant methods of research. Preclinical trials, Phase 1 involves tests on animals to show it's safe and effective. Phase 2, that the drug works. Finally, Phase 3, how effective the drug is. All 3 of your drugs failed to significantly improve human survival and life or outcome. With this money, I've been better spent on favoring the 3Rs refinement to improve Phase 3 results with more funding for silico modeling, invitro methods, refined capabilities in a jingle innovative study, creative ideas of new devices and methods. Although from 2006 to 2018, your animal testing has dramatically decreased, you could have like not been using animals anymore. So with the usage of animal testing, you are committing the pipeline to develop a drug that will ultimately fail. Straightforward data can be used to make this case, for instance, as reviewed by ZARs and ASH in 2,510. Over 200 different interventions have been reported to be effective in the APP mass model of Alzheimer's disease, yet none has proven 56% for Phase 1 designed to assess safety and estimate dosing, then 82% for Phase 2 designed to assess proof of concept and 50% for Phase 3 designed to assess safety and effectiveness for humans, a cumulative 96% failure rate. This is human disease with impairment in abstract reasoning and judgment. We have cured in mice, engineered with this disease over 500 times. The mouse models do not translate into humans. We know for a fact, mice do not read books. All this research was done by Howard Bullitt, Chief Science, Alzheimer's Drug Discovery Foundation in 20 17. The logically being seductively straightforward, every drug entering human trials by definition worked on animal models in both safety and efficacy. And efficacy is the primary reason for these failures that can be traced back directly to false positives in animal testing. So would this not explain then what an archaic waste of precious time, money and human animal life still using animal testing is doing. Why are you still doing this? Why? By scrapping all animal testing and furthering medical advances and treatments. So why? Earth, furthering medical advances and treatments. So why are you still continuing to torture animals needlessly? Okay. I think trying to derive a question from your statement there, you're questioning whether animal models are necessary and work. And I think, Nazneen, you covered some of that in your first response on a similar question. But anything you want to add there more? Go ahead. So I think that the failure of certain drugs is well accepted and the need for better ways of predicting whether drugs will succeed or not is also well accepted. And we are doing many different ways in terms of trying to achieve that. Many of the ones you mentioned with predictive modelings of all types of different types, and many of those are beginning to show progress. It's obviously going to be difficult because there are lots of different types of diseases. There are lots of different types of molecules. And safety also is paramount. Mice are not the same as men, but mice have proved very successful for many drugs and then not so successful for others. And so we take the successes where we can find them, and there have been many drugs which we've heard about today that have been successful. Where they're not successful, then we have to try new approaches. And a lot of the energy we're doing are approaches that allow us to have better models and that also allow us to reduce the animals that we are using. And as you noted, we have dramatically reduced the number of animals that we are using. But currently, they are essential, we believe, for assessing of efficacy and safety. Okay. Thank you, Nazneen. Okay. No further questions. Thank you. Thank you. I'm Andy Chubb, ex employee and shareholder. I come here today because the site the API site I worked for was due for closure in 2017. At the last minute, the company decided not to close the site and get rid of all the employees with their terms and conditions and go. They decided to divest the site to a 3rd party. That was in December 2016. As employees, AstraZeneca gave us lots of guarantees, alternative conditions, and things will be preserved for 3 years from the sale of the site. And of course, they did the right thing for the employees by putting these in place. Unfortunately, the venture with the new supplier has failed, and the site is in administration from February 13. 220 employees are now being losing their jobs with only statutory payments because the new company appears not to be able to support the financial commitments that are made in the terms and conditions. My question to you is I believe and understand from our union that AstraZeneca holds a guarantee of some description to compel the new owners to pay out the contractual payments as the employees are entitled to, we appear not to be able to exercise that presently. Will AstraZeneca help us exercise those rights? Okay. Does anyone know the details of this? It's the API side of Bristol Avalon. Yes. So I do not know the exact details of it. I know the background of it. I cannot answer your question about this 3 year guarantee and whether it's booked in any of our accounts or whether we have provision for any of it. But I can certainly look into it, and we will respond clearly on this matter. Yes. As an employee, I was AstraZeneca committed to us that we would preserve that for 3 years from the sale of the site. Unfortunately, it didn't get that far. So we were looking to leave the site as if AstraZeneca were closing it, pay our terms and conditions, and the outcome would be the same as what it would have been if AstraZeneca closed it. And this is what's not happened. No. Let me investigate this matter further. Thank you very much. Okay. My name is Rachel Muthai, and I'm from the CAP campaign. I've been asked by Benjamin Sefaniah to deliver a message on his behalf. As I'm sure you'll know, Benjamin Sefaniah is a famous poet, novelist and playwright. So he says, the use of animals in experiments is cruel and should be completely replaced by human relevant research. I urge AstraZeneca and all pharmaceutical companies to listen to the concerns of campaigners and the public. Now I understand you've covered this a lot. My question is, would you be prepared to prepare a response for Benjamin Seppenier, which we can pass on to him? I think we have had similar requests on earlier AGMs, And you have an initial response, I think, from us, and our position remains the same as that first initial response. I understand that. I'm asking if you could prepare a response. Clearly, I'm passing on a message. If you could prepare a response for Benjamin Zephaniah? If you send whatever you want to have a response to us, we will let you know. Okay. Thank you. Hello. My name is Aaron Mathai, and I'm also from the CAPP campaign. I'll try and keep it brief as I know you've had a lot of questions about animal experiments. At your last AGM, we asked whether you would be willing to take part in a debate about the scientific and ethical issues around animal experiments. You said if we contacted you, you would certainly consider it and that you would give a response. We emailed and we sent letters by recorded post to all your Cambridge addresses and yet received no response. In your sustainability report in 2018, you said that you used 120 1,000 animals in your own labs and almost 30,000 in external contract research labs. These animals included mice, rabbits, dogs, guinea pigs, ferrets and although Yasmeen said that you didn't use primates, you did use primates according to your report. When you test drugs on species of animals, you get data that is relevant to those species. Many independent doctors and scientists now state that data cannot be effectively applied from animals to human beings. We believe one of the main reasons pharmaceutical companies continue to support the use of animal testing is that it acts as an insurance policy in court when drugs go on to harm human beings. We've seen data published in peer reviewed scientific journals that shows animal testing is not predictive of human outcome. Animal testing is not only cruel, but it costs human lives too. I'm sure you'll disagree with this, and I'm sure you'll want to challenge these assertions. Well, we would openly invite you to a public debate to someone from any stage of your organization, any date and time of your choice, as stated in our letters to you, to come and debate this. AstraZeneca is a signatory to the concordat on openness on animal research, which includes a commitment to enhance communication with the public about your use of animals, but yet you still haven't responded. My question to you today is, is it not the case that AstraZeneca refusal to respond to our request for debate is actually because you know in an organized public debate, our contentions would be proven to be correct? Thank you very much. Right. Thank you, Mr. Matthey. We have covered quite a lot of ground already on that. I think the basic issue whether animal models work for testing for medicines, We've already heard Nasreen talk into some depth about, which of course is part of the public debate that you're asking for. Well, we'd like a public debate where we can present our case with our scientists against your scientists and see if that's see if what you say stands up. Mr. Murthey, that's happening every day. This is something that is being debated. But you would you agree to a public debate? You had our response last time, which was to say that we did not want to engage in a public debate under Last time you actually said that you wanted us to write to you. And our decision remains the same. Last time you said you wanted us to write to you and put in words whether and we have done that and received no response. Right. Well, that's because our response was the same as last time you wrote a very similar letter. But last time, at this time, At the last AGM, you said that you would respond to a letter requesting a debate. Right. And the letter was very much the same. The drug Tagrisso was proven to be able to penetrate the brain. We can never do that without animal model. Just hold one second. Let me finish because I'm the doctor, you're not. So without this information, we are not able to use this drug for number of lung cancer patients with brain metastases. So there are situation, the animal model information is vital to the understanding of the cancer of the drug and leading to immediate effect of the patient who need the care for. So it's not a matter of debate, it's a matter of practically, we need the information. Okay. I'll just respond to that. Yes, you're absolutely right. I'm not a doctor and I'm not a scientist. That's why we want a public debate with doctors and scientists who can present their case. If AstraZeneca is sure of their case, they'll agree to this public debate because it can only help to improve the knowledge of the public about animal experiments come to Hong Kong. Happy to have a debate with you, dear. But why would there be a debate here? All debate is a matter of to choose the conditions for those debates. You're actually now in a public debate. But what I want is a debate with our scientists to be able to speak to you. I'm not a scientist. I'd like our scientists to be able to speak to you. It sounds like you are the only one who are conducting this debate and that needs to be done under your, No, we're happy to agree to your conditions. This is not the case. This is We're absolutely happy to agree to any condition you put forward. You listen to 2 of our scientists already now giving you a public debate part. But it's not a public debate with scientists. And we'd like to do that. And I think the fact that you don't want to do that shows that your position can't be scientifically justified. You don't want to put your scientists against the anti reverse section scientists because you know it will be proven to be correct? That's a conclusion you can draw. I don't agree with that. We don't agree with that. Certainly, but that's up to you. Thank you. Thank you. Good. Thank you, Chairman. My name is Dinesh Chien, individual shareholder. First of all, I would like to add my thanks to the gratitude expressed by Mr. Muriel on the fantastic performance by the company, by its research teams, etcetera. I have two questions, please. First of all, our research team has been extremely successful in the recent past. What steps are the board taking to make sure that the research team retains that edge? They don't start resting on their laurels. They sort of keep the pace up because often it has been the case in the past that just when the pharmaceutical companies at its peak, at its most successful, they sort of take their eye off the ball and it sort of stores up problems for the future? That's the first question. My second question regards the situation in the U. S. Election season is coming up, and drug pricing is becoming a live issue there. You referred to the inquiries by the U. S. Congress. And it wouldn't be long before the U. S, before the White House and the administration wisens up to the fact that, in fact, the U. S. Is subsidizing research for the whole world. And especially Europe is a free rider on U. S. Patients, many of whom are struggling. And President Trump has tweeted that he wants drug companies to charge the same price in the U. S. As is charged in Europe. Our first quarter results released this morning show that our sales in the U. S. Are up, but in Europe are down, presumably because of drug pricing pressures. So what would happen if the U. S. Were to enforce President Trump's tweet and make sure that you can charge in the U. S. Similar prices to what you charge in Europe? What does our financial modeling show in such situation? Thank you, Jim. Okay. Pascal, research productivity, how do we maintain what we have achieved over the next last couple of years? And then pricing U. S. Versus rest of the world? Yes. I mean, it's this is a great question. And I can assure you that we actually get up every day and we think about how do we maintain this productivity. I'm completely convinced like you are that the most dangerous time is when you do well because you can actually start relaxing, and we will not relax. We have constant discussions with our research teams on what are the next steps. And I've told you that we spent a fair amount of time and effort thinking about new technologies, new biology and where should we be in the future. We have of course, we track metrics. We look at as I mentioned also, we look at where we publish, where our scientists publish. We try to attract the best scientists. We are lucky that in the U. K, we are in Cambridge. It's a vibrant place. I can tell you, at the university, they attract, as you know, some of the best minds from around the world, from the U. K, of course, but also from around the world. And those are the people we are up shoulders with every day. So it keeps you on your toes when you are talking to the best scientists in the world every day. So we constantly think about that and challenge ourselves. As it relates to the second question, and beyond talking about it, we also have metrics, as I said, and we look at our productivity on a regular basis. The U. S. Situation, I have to I happen to believe that, I mean, President Trump has a point is that and you have a point is it is true that U. S. Patients or U. S. Taxpayers, I should say, are suddenly paying for a fair amount of research and development around the world. Now what he doesn't say though is that patients also benefit from this because it creates a lot of good jobs in the U. S. I mean, all this investment in R and D creates good jobs in the U. S. And it also means that U. S. Patients tend to get access to innovation much faster. I can tell you that a very important drug like Tagrisso that saves lives is already used in the U. S. For the first line treatment of lung cancer, has been used there for at least 6 months immediately after we got approval. It's already used in Japan also. In Europe, unfortunately, patients are still waiting. They are at the back of the queue because someone in an office somewhere has decided that they're not going to reimburse it yet. So that's an issue. But certainly, it's not all in one direction. The U. S. Also benefits from this innovation and investment innovation. I think ultimately, personally, I believe that U. S. Prices should be a bit lower, European prices should be a bit higher. I think the country that probably contributes and pays the right the fair level of price is Japan, just sort of halfway in between Europe and the U. S. How do we get there is really a question that we're all wrestling with and is a problem. But it has to correct itself over time. I think in the meantime and near term, the U. S. Should remove this rebates that the industry pays middlemen, as the president also calls them. And if we remove the rebates, it would enable us to reduce our list prices. Some of our drugs on a net basis, net price basis are priced at the same level as Europe. I mean, I talked to you about the GINA guidelines and Symbicort. The net price of Symbicort in the U. S. Is similar to what we pay what we charge in Europe, in Sweden or elsewhere. But the lease price is multiple times higher, and the difference is rebates. Now if they remove the rebates we pay PBMs and others, we could reduce our prices. And that would translate into lower out of pocket costs for patients. That's one thing they need to do, and they're working on that. And the other thing they need to do is embrace the use of biosimilars. The model is you develop an innovative medicines, then you lose your patent protection. It goes to generics. And if you look at Crestor, society paid a fair price for it for, I don't know, 10 or 15 years. And now you can get Crestor for $0.10 a day, and it saves lives, right? So that is the model. You pay society pays for a period of time and then gets the medicine for free, but very, very low price forever. So biosimilar is the same. Biologics have to follow the same logic. In Europe, biosimilars are used. In the U. K, you probably saw the NHS announced they saved a lot of money recently to use a biosimilar of a biologic used to treat rheumatoid arthritis and other conditions. So they need to do the same in the U. S. And save money that way. But ultimately, for new products, some solution needs to be found to this issue of the U. S. Paying for not the rest of the world, but certainly Europe. And I mean, I agree with that. But nobody has found a solution yet. David Quint, Private Shareholder. Do you have any research work or intend to have any on bacteriophages? On bacteria? Phages. The answer is no. I mean, and it's not because it's not interesting because I really believe that there is interesting science that is breaking through and developing in this area. But I'm a believer, as I said earlier, that you need to stay focused on what you do well. And there's so much we can do in the areas where we are. And we don't have enough resources to do what we do very well. So going into new areas outside of our 3 core therapy areas would be something we could not sustain. So other companies will have to look at that. Fair enough. Good. Thank you. Are there more questions? Seems not. Good afternoon. My name is Doctor. Kilgour. I have a question about your oncology work, which should probably be directed towards Tony Mok. A lot of the investigations are done for oncology at the level of the lungs or the large organs. I'm wondering about the cell cycle and why the cell cycle is not being targeted for these investigations. I've recently done some teaching, a tutorial in Oxford, and one of the Oxford students asked me, where do the ASEAN come from? This was in relation to the first person who asked the question here. I could only answer that I think the ASEAN come from the ASEAN Federation. Okay. Just that was in relation to the first question. Is there any relationship currently known between vaccines and fertility? That was also in relation to the question. We can probably share the answer. First of all, about the sales cycle. Some of these questions are somewhat rhetorical. Right. About the sales cycle, there are drugs targeting the CTK4 and six inhibitor, which actually have been on the market already. However, the problem with the cell cycle inhibition is the fact that it's not specific only for cancer cell. So therefore, the toxicity to the normal cell is also quite significant. So we are making some progress in term of cell cycle inhibition. However, I do not see a major breakthrough as we move along this line. So is that at the metaphase plate? So are you talking about metaphase plate inhibitors? No, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, so if I'm talking about vincristine and vinblastine, which are organic alkaloids, they actually stop the metaphase plate. That's how they work. So in the cell cycle, if one concentrates on a particular area such as the mitotic phase or at the where the telomeres break in cell division, That is exactly what cytotoxic chemotherapy is doing. Like the Plagitaxel, the taxane is actually specific for the mitotic process. And so that's exactly what I was referring to the lack of specificity to the cancer cell because whatever drug that targeted the mitotic process may also potentially damage the normal cell. The yew tree that produces the pine needles that produce the tax hole that you're talking about has been known as a poisonous tree for cattle. They used to be in vicarage gardens, and the cows used to poke their heads over the fence, and they would be dead the next day because they'd eaten the pine needles or the needles from the U. So I mean, Taxol is essentially targeted at the moment at ovarian cancer, which is a very small area of oncological investigations. What I really want to know is why there is not more investigation pointing towards the interphase or the other areas of the cell cycle in the G1, G2 phases? Yes, it sounds like it's a fascinating discussion. Good. Further questions or comments? If not, then thanks for all your questions. And let's now move to the voting. I'm appointing Equiniti, the company's registrars to act as scrutineers. As usual, we'll be holding a poll vote on all the resolutions. I hope you all have polling cards and pens that you were given at registration. If you've already lodged a proxy form appointing the Chairman of the meeting as your proxy and you do not wish to change any of your votes, there is no need to complete the polling card. However, if you wish to change any of your votes, you must complete the polling card with respect of every resolution. We expect to announce the results of the votes later today. You have all received the notice of this meeting together with my letter and the circular that explain what is being proposed. This year, there are 12 resolutions on the agenda, and I would now like to move to put the resolutions to the meeting. In the interest of efficiency, I will not read out each individual resolution, but to remind you they are being displayed on the screen and they are of course also on your polling cards. I put resolutions 1 to 8 to the meeting as ordinary resolutions and I put resolutions 9 to 12 to the meeting as special resolutions. As usual, a separate vote is being proposed in respect of the election of reelection of each director. Let me now ask Graham Chipchase, our Senior Independent Non Executive Director, to propose the resolution for my own reelection. Thank you, Leif. I'd like to propose a resolution for the reelection of Leif Johansen. Thank you, Graham. Please now mark your polling cards to cast your votes. May I remind you please to take your completed polling cards and post them into the polling boxes. You will find the polling boxes at the doors as you leave the room. You can deposit your completed polling board into any box. The polling boxes are easy to spot, but please don't hesitate to ask one of the ushers if you can't find 1. The poll will close 10 minutes after the end of the meeting. We expect to announce the results of the voting later today through our regulatory information service and on our website. That, ladies and gentlemen, concludes today's business. Thank you for attending the meeting. May I wish you a safe journey home and good day to you. Thank you.