Good day, and thank you for standing by. Welcome to Galderma's conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session with financial analysts. To ask a question during the session, analysts connected on the telephone conference call will need to press star one and one on your telephone, and you will then hear an automated message advising your hand is raised. To withdraw your question, please press star one and one again. Please be advised today's conference is being recorded. I'd now like to hand the conference over to Emil Ivanov, Head of Strategy, Investor Relations, and ESG, to introduce the call. Emil, please go ahead.
Thank you. Welcome to Galderma's third quarter 2026 trading update call. The press release was published today at 7:00 A.M. Central European Time and can be consulted on our corporate website at any time. Today's presentation slides, as well as a recording of the webcast, will be made available on our website after the call. Please be advised that today's presentation contains forward-looking statements, which should be treated with the appropriate level of caution, as detailed on the slide. Let me now introduce today's webcast. Dr. Flemming Ørnskov, CEO of Galderma, and Luigi La Corte, CFO, will provide performance updates for the first nine months of the year and discuss the outlook for the full year. After the presentation, Flemming and Luigi will be available to answer questions from financial analysts before Flemming provides his final remarks to close the webcast.
With this, I would like to invite Flemming to start with Galderma's highlights for the third quarter of 2026. Flemming, over to you.
Thank you, Emil. Good morning, good afternoon, and welcome to Galderma's third quarter 2026 trading update webcast. It's a true pleasure to be here today to discuss Galderma's continued momentum across the business and the strength of our proven integrated dermatology strategy. As usual, none of this would be possible without the dedication of our teams around the world. With execution against our three strategic pillars, we are driving growth across the core portfolio, complemented by innovation and further increasing penetration in fast-growing markets. We also continue to take steps to expand our portfolio and further strengthen our dermatology platform. First, organically with progress of our innovative pipeline, we're starting new indications for nemolizumab, progressing our biostimulator clinical assets, and developing new innovation for Cetaphil and for ALASTIN, just to name a few examples.
Second, we continue to explore external innovation that would benefit from the globally scaled integrated dermatology platform that we have built. Our recently announced agreement to acquire ZO Skin Health is a prime example. It represents a highly strategic and financially attractive addition to Galderma's business. As a leading science-based, physician-endorsed skincare brand, ZO Skin Health is a very strong strategic fit. Its portfolio and global presence, complementary to ALASTIN's, would enable us to expand our dermatological skincare offering in the attractive, fast-growing physician-dispensed skincare segment. ZO's daily regimen and targeted prevent and correct portfolio complements ALASTIN's offering, more focused on pure procedure skincare. ZO's broad commercial footprint also complements ALASTIN's. ZO covers a high breadth of accounts, extending Galderma's existing reach for both ALASTIN and injectable aesthetic. ZO also brings a strong leadership position in the U.S. and in international markets, including Canada, Japan, the U.K., and the Nordics.
Galderma is strategically positioned to unlock value with ZO. Our integrated dermatology platform provides complementary synergies and scale. We can leverage our proven track record of supporting innovative science-led brands with research and development, skincare education, commercial capabilities, and geographic expansion. It also represents an attractive financial profile. With appropriate growth investments, we aim to return ZO to a growth trajectory as of the second year. We intend to follow the successful blueprint of our ALASTIN acquisition, protecting ZO's fundamentals while integrating it into our global dermatology platform. This represents a strong proof of our value creation capabilities. Luigi will provide more details later. For the first nine months of the year, Galderma delivered record net sales of $4.765 billion. Performance was particularly strong in therapeutic dermatology across both NEMLUVIO and the mature portfolio, as well as in dermatological skincare and in neuromodulators.
Net sales year-on-year growth was 25.1% at constant currency, with broad-based double-digit growth across the portfolio. We continue to outperform the market in each product category, supported by resilient market conditions that were ahead of expectations. We continue to benefit from sustained consumer demand and preference, particularly through our premium positions in injectable aesthetics and in dermatological skin care. We are raising full-year guidance on net sales up to 22.5%-23.5% growth year-on-year at constant currency. We are also confirming our Core EBITDA margin guidance for the full year of approximately 26% at constant currency. Let's now look at performance highlights for the third quarter by product category. In injectable aesthetics, we continue to build on our strong trajectory, driving expansion across the portfolio while reinforcing our leadership in science, in education, and in commercial execution.
On the portfolio expansion front, we continue to strengthen our leading position in neuromodulators with RELFYDESS. In the first launch markets, the majority of patients continue to be either new to the category or switching from competitors. We also further broadening our geographic footprint with regulatory filings ongoing in additional territories. In the U.S., following the FDA's Complete Response Letter in June and a recent Type A meeting with them, we are now targeting a resubmission in the first quarter of 2027, subject to further regulatory feedback. We are strengthening our chin augmentation offering with the launch of Restylane SHAYPE in Europe, together with new proprietary injection techniques. At the same time, we continue the geographic expansion of Sculptra with additional launches in Southeast Asia. Alongside this expansion, we continue to execute with a strong focus on our leadership in both science and education.
Positive phase III data for Restylane Volyme in temporal hollowing support our plans to expand in China while further strengthening the clinical evidence behind the Restylane portfolio. This year also marks 30 years of Restylane, providing an opportunity to reinforce its long-standing track record and its proven safety profile. We continue to expand the evidence supporting our portfolio in skin quality. Aligned with World Menopause Day on October 18, we highlighted interim investigator-initiated trial results showing progressive improvements in hydration, skin barrier function, and skin quality with Restylane Skinboosters and Sculptra in menopausal women. In dermatological skin care, we significantly outperformed the market, driven by strong execution across our flagship brands. For Cetaphil, we maintain our focus on international markets and disciplined executions against three fundamentals.
Strong core brand equity anchored in superior science for sensitive skin and dermatologist recommendation, prioritizing the core portfolio and driving locally relevant activation. The strength of our established portfolio remains a key driver of performance. While we continue to support innovation, more than 60% of Cetaphil's global growth in the first nine months came from the core portfolio. This was supported was supported by locally tailored campaigns with particularly strong activation in fast-growing international by locally tailored campaigns with particularly strong activation in fast growing international markets. With ALASTIN, we remain focused on the attractive peri-procedure opportunity. Where we are sold, the brand remains the number one preferred option among physicians to spec skin care brands overall and for procedure pairing. In addition, brand familiarity among healthcare professionals grew 25% compared to last year. We also continue to innovate with the U.S. launch of [Restorative Eye Complex with TriHex technology].
In therapeutic dermatology, NEMLUVIO is approaching leadership in prurigo nodularis in the U.S. and continuing to ramp up in atopic dermatitis. In the U.S., NEMLUVIO shows healthy and growing underlying demand, supported by increasing prescriber confidence and disciplined commercial execution. The majority of patients continue to be new to advanced therapies across both indications. In prurigo nodularis, our rolling six-week market share is trending at approximately 45% of paid new patient starts and 37% of total paid prescriptions. In atopic dermatitis, we are trending at approximately 9% and 5% respectively. We also continue to broaden NEMLUVIO's global footprint with approvals across both indications in more than 40 countries, and further reviews are ongoing. Alongside this strong commercial momentum, we continue to invest in NEMLUVIO's future growth drivers. New three-year ARCADIA long-term extension data reinforce its durable efficacy and favorable tolerability profile in atopic dermatitis.
NEMLUVIO is the first therapy to demonstrate freedom, yes, freedom of itch, further reinforcing its recognized differentiation in itch relief. The data also supports positioning of a strong skin clearance profile with sustained improvement through three years. Recently published patient-reported outcomes from a phase II study of nemolizumab in children aged 2 - 11 with moderate to severe atopic dermatitis showed meaningful reductions in itch severity, showed better sleep, and showed improved quality of life maintained for a year. Over the next month, we are planning to file a U.S. submission in pediatric dermatitis in the U.S. following clinically meaningful late-breaking data that we presented in the first quarter. In addition, we continue to explore opportunities across additional potential indications. With that, I am pleased to hand over to Luigi to provide more details on our performance.
All right. Thank you, Flemming, and good morning, good afternoon, everyone. Truly a pleasure to have the opportunity to comment, and I should say, celebrate what was a very strong set of results in the third quarter. Also, a number of important milestones that the group achieved. Among these, of course, the inclusion in the Swiss SMI index, and the upgrade of our credit rating by Standard and Poor's to BBB+ with a stable outlook, which they have reiterated recently and which clearly recognizes our ever-stronger financial profile. With regards to our trading performance, momentum clearly remained very strong for the first nine months. Revenue growth of 25.1% at constant currency, which continued to be predominantly driven by volume, complemented by favorable mix.
Nice to continue to see also net year-on-year price being positive, excluding, of course, the expected gross-to-net erosion on NEMLUVIO, which continues, however, to be below expectations. Growth was broad-based with double-digit growth across all product categories and in most of our top 10 markets. International, as you see from the slide, grew 18% at constant currency, with double-digit growth in all areas. U.S. up 34.7%, clearly driven by the continued strong ramp-up of NEMLUVIO, but with positive sales growth across all categories and above 10% also excluding NEMLUVIO. Q3 year-on-year net sales growth of 26% was supported by continued outperformance of our portfolio across all categories and resilient market conditions that were ahead of expectations. Looking at each of the categories in a bit more detail, starting with injectable aesthetics. Net sales were up 13.2%.
We continue to outpace the market across geographies in both neuromodulators and fillers and biostimulators. As we had anticipated already at Q2, revenue growth for neuromodulators was particularly strong in the third quarter, benefiting also from the unwind of phasing effects from Q2 and offsetting somewhat lower growth in the quarter for fillers and biostimulators, which reflect for this category a high base in the second half of 2025. Overall, in the first nine months of the year, neuromodulators delivered sales growth of 16.9%, with Dysport continuing to grow double digits across all key markets, including those where we have launched RELFYDESS, which continues to ramp up very nicely and is now approved across 37 markets. Fillers and biostimulators achieved growth in the first nine months of 8.5%, despite continuing to see some softness in some geographies.
Sculptra, meanwhile, continued to grow double digits both in U.S. and international, despite a growing comparable base in the second half of 2025. Dermatological skincare sales were up 16.2% at constant currency. We continue to maintain our strong growth momentum, driven by our flagship brands, and continue to outpace the market. In both the U.S. and international, consumer demand remains supportive, with interest in the dermatological skincare really providing resilience to the category, which remains under-penetrated relative to other parts of the broader skincare market in most key geographies. E-commerce remains the fastest-growing channel globally and represents the large majority of our revenue in Asia, supporting very strong growth of Cetaphil in that region and across international markets.
ALASTIN delivered double-digit growth in both geographies with continued penetration in the U.S. and continued geographic expansion, and we really see the product continuing to benefit from strong growth of the physician dispensed market. Finally, on therapeutic dermatology, sales were up 64.4% at constant currency, obviously reflecting the very, very strong growth of NEMLUVIO. NEMLUVIO sales were $735 million in the first nine months, and just over $300 million in Q3, with a quarter-on-quarter increase of 22%, and with atopic dermatitis contributing more than prurigo nodularis. We continue to make progress in penetrating both the commercial and Medicare parts of the market, while maintaining a disciplined execution in our ongoing negotiations with payers in the Medicare plans.
While the U.S. continues to represent the majority of the sales for NEMLUVIO, it does continue to ramp up ahead of expectations also in our international markets, and we are preparing for the launch of the product in Brazil. Mature therapeutic dermatology portfolio was up 9.2% and did continue to show positive growth in the third quarter, with lower than expected impact from generic entries. Also showing good growth of Differin globally and especially in the U.S., which was driven by the strong launch performance of the product post the [OTC switch] earlier this year. Overall, very strong momentum across all of the categories.
Thanks to that stronger than anticipated trajectory, when we look at the full-year outlook, and thanks to that strong momentum, particularly on therapeutic dermatology, dermatological skincare and neuromodulators, we now expect year-on-year net sales growth, Flemming has said, of 22.5%-23.5% at constant currency for full year 2026, up from 19%-21% previously. Good growth rate in the fourth quarter clearly is expected to reflect a significant step up in the NEMLUVIO run rate in the fourth quarter of 2025, as well as transition to structurally lower channel inventory levels in Brazil, our third largest market, driven by the expected implementation of tax reform in the country as of January 2027. In injectable aesthetics, we continue to expect full year growth of 12%-13% at constant currency, likely in the upper half of that range, assuming a continued supportive market environment.
Within this category, fillers and biostimulators growth for the full year is expected to be broadly in line with year to date rate, potentially slightly below, again, depending on the market conditions. In dermatological skincare, momentum remains strong and performance continues to be ahead of expectations. Although, as already set out at the start of the year, we expect some moderation in the fourth quarter against the high comparative base. Therapeutic dermatology in NEMLUVIO is clearly well on track to break into blockbuster territory in terms of global net sales for the full year, while we expect the mature portfolio to show mid-single digit growth at constant currency thanks to the slower erosion that we've seen in the first part of the year, particularly in international markets.
On profitability, we clearly confirm our Core EBITDA margin guidance of approximately 26% at constant currency as we continue to invest behind the very significant growth opportunities that we see ahead. Our guidance excludes any potential contribution from the acquisition of ZO Skin Health, which is expected to close in the fourth quarter of 2026 or early 2027, subject to regulatory clearance. Of course, as usual, you will find our highlights in terms of foreign exchange exposure impact on revenue EBITDA in the appendix. A few words from me on the ZO Skin Health acquisition. Clearly, as Flemming has said, from a strategic and financial point of view, a great opportunity for Galderma. We expect, as I said, for this to close in Q4 of this year or early next.
The transaction will be financed through existing cash reserves of approximately $700 million and bank financing of $800 million. In terms of financial profile, as you know, the business reported net sales of approximately $330 million in the last 12 months as of June 2026. We do plan to increase commercial investment to strengthen the foundation for renewed growth as of 2028. While from profitability, we expect the acquisition to be slightly dilutive to Core EBITDA margin in 2026, 2027, sorry, and achieve broadly margins comparable with the group average already as of 2028 onwards, and is expected to be Core EPS neutral in 2027. We estimate approximately $50 million-$60 million of one-off integration costs over the first two years of the acquisition.
Most importantly, beyond the terms of the transaction, what we are really excited about is that acquiring a great asset like ZO Skin Health creates an additional long-term growth driver for Galderma while maintaining financial discipline. On that, we thought important following this acquisition to confirm that our capital allocation priorities remain unchanged with disciplined investment in growth at the core. Our first priority continues to be investing behind organic growth, including our commercial capabilities, R&D, and manufacturing capacity to support the significant growth opportunities we see across the portfolio. We will, alongside this, continue to explore selective licensing and business development opportunities across all three product categories, looking for opportunities that can broaden our portfolio and further strengthen our long-term growth profile.
We will, together with this, continue to further drive shareholder returns through progressive dividends, on which our policy remains unchanged. Where appropriate, we will also consider share repurchases. We will do all this with discipline in our investment decisions and maintain a strong balance sheet, and maintain and reiterate our commitment to maintaining a solid investment credit rating. Finally, before closing, we remain confident in our ability to continue to drive broad-based growth and outpace the market across all product categories. This underpins our midterm ambition with extended midterm guidance to be communicated early next year, as already mentioned, at the time of our 2026 full year financial results call.
Thank you, Luigi. Thank you, Flemming, for the introductory remarks. This concludes the first section of our webcast. Before final remarks by Flemming, I would like to hand back to the operator today, Sarah, to open the call for analyst questions. As usual, in the interest of time, we would appreciate if everybody can keep it up to one question per turn so that we can fit as many of you as possible. With that, Sarah, over to you. If you could please open the line?
Thank you. If you would like to ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. Please stand by while we compile the Q&A queue. Thank you. We will now start with our first question. This is from James Gordon from Barclays. Please go ahead.
Hello. James Gordon from Barclays. Thanks for taking the question. I will limit it to one, which is about NEMLUVIO. NEMLUVIO Q3 performance was a bit stronger than I might have expected or the market might have expected if we just looked at the IQVIA data, which looks quite flat and it looks like there is some share lost to at least Ebglyss if you looked at the new to brand prescriptions. But the sales were up about 20% sequentially. What did we not really get right? Was it just that the channels are poorly capturing with IQVIA where you are actually growing more quickly and that is what we missed? Or is there some net price benefit? It looks like maybe there would even have to be a sequential teens price benefit.
Could there be anything to do with 340B changes, which I know hit a number of other derma products for other companies this quarter, or is the ex-U.S. starting to ramp? Is the progression from Q2 to Q3 a clean number we could extrapolate to Q4 as well, and you could still do $1 billion just in the U.S. this year? Thank you.
Well, thanks a lot, James. IQVIA is a great source of data, but not perfect. It does not cover all the channels. There are pockets of channels where we are very strong that they don't seem to cover. There are also facts about that our prescription are paid prescriptions. There are also various programs that, for instance, Ebglyss has that record non-paid prescriptions. There are a number of things to take into account. I think the numbers we're giving you are the real numbers. We continue to perform strongly, but it is true that Ebglyss is particularly putting a lot of resources into DTC. They're performing well. I think if I look both at our commercial plan performance and I look at our Medicare performance, even though we have less coverage than many others, we continue to perform very well. I think being a what?
A sixth or seventh entrant, I think we've broken many records. We'll see whether we hit $1 billion in the U.S. We certainly will hit $1 billion globally.
Thank you.
Thank you. We will now move to our next question. This is from Matthew Weston from UBS. Please go ahead.
Thank you very much. My question is about the ZO Skin acquisition. If I think back to when you acquired ALASTIN, I think you have doubled revenue in either three or four years with that franchise. I realize the ZO Skin franchise is significantly bigger in terms of total revenue at the beginning. I was interested whether or not you felt it was also possible to drive a similar amount of growth over a similar timeframe with that brand, and that is how we should think about modeling the deal in a midterm.
Yeah, I will let Luigi also add, but I was intimately involved in the ALASTIN acquisition and the integration. It does take, unfortunately, a bit of time. We will, first of all, have the deal to close. Secondly, we will need to align the two field forces. We will look at accounts. We will look at the portfolio. It is quite clear that it is super complementary. We have refocused ALASTIN where we have both more or less rebranded it. We have reformulated with the TriHex+ and we position it to a strong preference in peri-procedural care. I think we have grown to, I think, number four in that category in the U.S. with phenomenal growth. I think we more than doubled. I almost would say tripled the business.
Do not set your expectation that we will be able to do the same with $330 million in a very short period of time. It will take some time. The brand could need some more investment. There are other things we want to change. Once the deal is closed, we will sit down with the team. We will figure out where it is, what we can do, what the opportunities are. We wouldn't have bought it if we were not confident that it would be a growth contributor to us, but it may take some time. I think, realistically, 2027 will be a bit of a year of a reset, and hopefully in 2028 we can start seeing some of those benefits. Luigi, anything you want to add?
No, I will just add, we really are excited, and also because of the complementary of the portfolio. The only thing I would add is that this is very complementary and synergistic with ALASTIN in terms of both channel and geography. We expect that, and the reason we are excited about this acquisition is that not only we will expect to grow the business, but we expect this acquisition to potentially help us continue to sustain ALASTIN growth in the future as well, thanks to that complementarity.
Can I just have a quick follow-up if I can? If I think of the outperformance of NEMLUVIO into 2027, some of that would be falling through to the bottom line. You obviously now commented around an investment year behind ZO Skin Health. Should we think of that as being a drag on 2027 margins versus consensus, or we should think of the outperformance of base Galderma funding the reinvestment in ZO Skin Health?
Well, I think in terms of margin for next year, of course, we will provide guidance in early 2027. We remain committed to that sort of midterm target that we had set out, that imply the level of margin accretion for next year. I think we have said, and of course, yes, the business is growing at a very healthy rate, and that momentum will continue. We do have to also bear in mind, as we said, one, a little bit of diluting effect from the acquisition, subject obviously to when it closed, as we do intend to invest behind it. And two, there are new tariffs coming in. Since September, Section 232 tariffs are now relevant for NEMLUVIO. We do have inventory cover to middle of next year. There will be a little bit of headwind from that. It is manageable.
We are working through the guidance which has been provided most recently. Again, we will not provide specific comments. We are still aiming to deliver on that margin accretion target that we set out, but those are the pluses and minuses, Matthew.
Perfect. Many thanks indeed.
Thank you. We will now take our next question, and this is from Benjamin Jackson from Jefferies. Please go ahead.
Great. Thank you for the question. Flemming, I just wanted to ask on the level of confidence heading into that RELFYDESS resubmission post this meeting with the FDA. I appreciate you've not had the written comments back yet, but are you coming away feeling better around the analytical methods, which perhaps was the stickier part of the conversation? I guess this time last year, you were very much talking about one big issue that had to be fixed that you still needed to work on. Where are we relative to that? Is this somewhere where you're much more confident heading into this cycle? Thank you.
Yeah, of course. As a Scandinavian, I love to spend time in Scandinavia. Also with Luigi, we've had trips to Uppsala, which is particularly beautiful in summer, I would say. We'll now see how beautiful it is in winter, because it probably will warrant a few more trips. Yeah, we're very busy. I'm incredibly proud of the team. First of all, they keep adding countries where they have been approved for RELFYDESS, so they really know how to manufacture, and we've had no stock-outs or anything, so I'm really proud of the team. The U.S. has set a very high bar. I think that we have really worked very hard on the CMC issue, so it's down to, I would say, one or two. We are still waiting for the written comments by the FDA, but I think the team has provided good solutions.
Of course, they will be subject to review. Then on the getting Uppsala up to the level that the FDA's inspection, so that we can sustain another pre-license inspection, which is probably more likely. I think the team also with external support, also people that knows what the FDA is looking for, is doing a really good job. I wish I could guarantee. There is no guarantees. I think we have a very serious competitor that also seems to have some of the similar questions. I can only say the team has done a phenomenal job. They have reduced the number of open topics. We have a very productive Type A meeting with the FDA. We're waiting for written feedback. I think I've seen that firsthand, the significant upgrading, including some new buildings that is going up in Uppsala, so we can meet the highest standards.
I feel optimistic, but of course, there's no guarantees. We're working really hard. We said it will probably be in the first quarter of next year. We know every week, every month count, but we're very busy. As you know, we also are trying to file the pediatric data for NEMLUVIO before year-end, and we have a few other highlights that we need to get done. I feel confident also that the regulatory team will meet that guideline.
Brilliant. Thank you.
Thank you. We will now take our next question. This is from Shyam Kotadia from Goldman Sachs. Please go ahead.
Thank you. My question is on the Ipsen arbitration that you called out in the press release. I just wanted to get some clarity on that. Is this all to do with the commercial rights for IPN10200, or are there other elements you're seeking arbitration on as well? What does this therefore mean in terms of a potential partnership for the toxin in the event you are successful? Are the commercial partnership terms set in stone in the contract, or is this something you need to negotiate with Ipsen following the outcome? How long do you anticipate this could take? Thank you.
Yeah. First of all, I imagine I couldn't recall the number you were saying, but it's commonly known as the [LAN], the long-acting neurotoxin. I just wanted to say that this is just pertaining to the commercial part of this, because we have, and it does not pertain to any of our other products, RELFYDESS, Dysport, and others. We have exclusive rights to commercialization in quite a number of countries around the world for the aesthetic indications for those, and that's what we continue to reinforce. It may feel a little bit strange from the outside, but the issue is that the way these many agreements were written, if the two parties have issues of discussion, they have to go to arbitration. It also means you have to have a lot of patience. I think the average time is two, maybe two plus years.
I think we have a team that will take care of it. We'll see what the outcome is, but it does not affect our commercialization of any of the existing marketing product. This is about the long-acting neurotoxin.
And maybe I'll just add, along at the same time, we continue to drive the full portfolio. I think I mentioned already in my remarks that we're very excited that the neuromodulator portfolio is growing strongly, and we continue to see double-digit growth of [Dysport] in all territories, also where RELFYDESS is launching, of course, very happy with the continued ramp-up of RELFYDESS as well.
Thank you. We will now take our next question. This is from Victor Floc'h from BNP Paribas. Please go ahead.
Thank you very much for taking my question. Maybe one on NEMLUVIO and on the market share in AD, which has been relatively flat lately, even though the performance of the product has been extremely strong. Just to get a sense of whether you can talk a bit about what you can do to drive further market share gains from here, and what you think could make the biggest difference going forward, whether it is D2C or just basically just increasing the coverage in the government channels. If I could just squeeze a quick one on capital allocation. Now that you have completed the ZO Skin Health acquisition, what are your main priorities going forward? Should we see focus shifting towards [laser aesthetics] in the future? Thank you very much.
I think we have to look a little bit at the big picture here, if I may.
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We just reported nine months results of $4.8 billion. We have now been speaking about adding another billion by a product, maybe even by year end. I think we need to put things in perspective. We are incredibly proud of the performance we as a six or seven entrants have achieved with NEMLUVIO in the U.S. Unfortunately, it is not so that the IQVIA data will provide you with a perfect image of the progress we are making. If I look at our actual market share in Medicare, very strong. If I look at our commercial penetration, very strong. It is also very important for me that we keep a perspective here. We are a relatively small company up against some really big companies, and I think it is about driving profitable growth. That is the most important, in my opinion, for a company like Galderma. It just turned profitable.
I think for us, we invest appropriately. We will continue to progress, but we still are expecting the team that they drive both market share gains, but also profitable growth. We are now, if we look forward, we are approaching potential leadership in prurigo nodularis. If I look at the September, October, new to prescription pace, it is 45%. If I look to atopic dermatitis, it is 9%. I think the team has had a really strong performance. Do we have competition? Yes. The most important to me is we progress really well. We are just talking about the U.S. If I look at the performance outside the U.S., one country after the other is at par with or even some outperforming on a relative scale, the U.S. So I feel very, very good about where we are.
You had a question, I think also on capital allocation. You never know when the next deal is going to be. We are looking in all three areas. We see opportunities in all three areas. We will not call out, you never give too much details about that. You never know until you sign a deal, whether you have a deal, and when you sign, you announce. We will see. We are looking at each one of those areas. We are excited to have brought this one to the finish line. Of course, we still have to wait for the regulatory clearance of it, but we will see. Again, I will re-emphasize that priority number one, as I said, is continuing to invest behind organic growth opportunities because we are very excited about the opportunities we have to continue to gain shares in markets which continue to show strong momentum.
We will continue to focus on that, complement that with M&A, and then of course enhance that, as I said, with returns of cash to shareholders.
Great. Thank you very much.
Thank you. We will now take the next question. This is from Joffrey Bellicha Meller from Bank of America Securities. Please go ahead.
Yes. Good afternoon, Flemming. Good afternoon, Luigi. Thank you very much for taking my question. This one is also on ZO Skin Health and the acquisition there. I was wondering during the due diligence process, if you could give us a bit of details on what overlap you are seeing between ZO's 16,500 physicians that you mentioned in the press release last week with either ALASTIN or the injectable aesthetics portfolio. Therefore, how should we think about the cross-selling opportunity here?
Is that effectively beneficial or incremental to growth for injectable aesthetics, particularly?
Yeah. Thank you very much. Good question. What we saw in diligence and what we saw when we looked from the outside, because they are, of course, also competitors to us, so we know them very well. We have built a very strong position with core dermatologists and plastic surgeons. They are much stronger, for instance, than med spas and others. Their portfolio is more a procedure as a kind of a package where you get multiple products. We are more procedure-related. They are more general skincare. We are more procedure-related. Of course, it is not a perfect separation on both sides, but what it will do for us is we will both increase the total number of accounts that we are calling on. We will supplement our strength with dermatologists and plastic surgeons with med spas and other accounts we are not in today.
We will have a portfolio that do not only cover pure procedural intervention, but also now with the more general skincare in the context of physician-dispensed skincare. Of course, we have some further refinement to do. We will look at the portfolio. We will make sure that separation stays clear. What we like the most is what we like the most about ALASTIN. It is science first. Dr. Obagi, 2007, started this company, has an impeccable scientific reputation. The products are high quality. They are scientifically differentiated. There are certain areas where we are not that strong, where they are very strong. It is exactly what we liked about ALASTIN. The commercial execution, we know how to do. The field product execution, we know to do. They were also not really strong or had not invested.
I cannot say they were not strong in e-commerce, an area we are very strong in. There are multiple things we can do. But as Luigi also said, it will require a little bit of investment next year, and we will then set it up for success.
Very clear. Thank you very much.
Thank you. We will now take the next question. This is from Harry Sephton from RBC. Please go ahead.
Brilliant. Thank you very much for taking my question. It is just on the guidance. So another strong sales beat, but reiterating on the margin. And we saw a similar strategy last year, and you have talked about the profitable growth for NEMLUVIO, which should be a significant driver of operating leverage over the midterm. But maybe can you walk through the areas that you are reinvesting in OpEx and also how some of that OpEx reinvestment that we saw through last year as NEMLUVIO outperformed and how that has helped with the sales outperformance that we have seen this year? Thank you.
No. I will take the first part and then I will ask Luigi to complement. It is quite clear that the atopic dermatitis market and even the prurigo nodularis market shows incredible growth, and you saw the percent of our patients that are actually new to therapy or new to biologics therapy. We see a lot of opportunities. A part of the additional investment has gone into some of the areas of strengths we see that is related to NEMLUVIO. The competitive intensity is also going up, so we also have to continue to stay attuned to that.
We haven't had time so far in the call today, but if I look at the phenomenal growth rate we have in dermatological skincare, if I looked at Asia, if I look at China, if I look at India, if I look even at Europe, if I look at the U.S., we have lots of opportunities to invest. In some areas, like probably in the U.S., we were probably investing a little bit less than maybe we should have, but we continue to look for opportunities. We don't just invest just to invest. People, of course, have clear targets that they have to deliver, but when you deliver 13%, 16% and 64% growth in the three categories, it's quite clear it's going to require some investment. Good news is we're flexible.
We allocate the resources to where we see if we invest a little bit more here, a little bit more in e-commerce, a little bit more in physician training, a little bit more here, we drive very strong strong growth. Does not mean that we're also not driving additional growth in injectable aesthetics, but we just highlighted those two as potential areas of further investment.
Yeah, the only thing I would add is if the question is, you're increasing sales guidance, why not margin as well? We took the view that achieving a roughly 26% Core EBITDA margin would deliver close to 300 basis points accretion in margin in one year. We think that's already a very strong increase. There are opportunities for growth. It's competitive markets. We want to become the undisputed leader, and now is the time to invest and go all in, as Flemming said, a number of these. We do want to be balanced with the pace at which we grow margins to make sure that we really maximize the opportunities that we have. As I said on many occasions, you only get one chance to maximize a product, particularly when it's still in the early phases.
We are very happy with that balance that we are striking this year.
Understood. Thank you.
Thank you. We will now take the next question. This is from Sophia Graeff Buhl-Nielsen from JP Morgan. Please go ahead.
Good afternoon. Thanks for taking my question. Just one on Sculptra. In terms of market share development, how have we seen that evolve over the course of the year in the biostimulator category? Are we seeing more of an impact of growth from market expansion in terms of interest in collagen stimulation, or are there also substantial market share gains? What is your expectation of how this outlook can look in China as we continue to see more competitor entrants?
Yeah. Overall, we are extremely pleased with Sculptra. As you saw from our results, fillers and biostimulators, they achieved $914 million, up 8.5%. We think that particularly the Sculptra part performed really well. I think what we have seen is, in certain markets, just astonishing phenomenal launch. I think Sculptra, we made the decision in China that it was going to be positioned as a significant premium product. We feel we have the science. I think we have the safety and other track records. We did enormous amount of training. It continues to do extremely well. Is there a lot of competition? Yeah. I think there were six when we started and 23 now, but I still see that very strong performance. All our portfolio, whether it is in China and Korea or in many other markets, we are one of many. We are used to that.
The key thing is we are not one of many when it comes to premium, science-backed, high quality, predictable outcomes. That is what is the really opportunity that is important. We also look at reorder rates in China. Very sound reorder rates. I feel very good about it, but we cannot stay too optimistic without every single day being a little bit paranoid about all the competition. I am really looking at reorder rates. I am looking at the growth rate. If I look at that, and I look at this team that is not only able to deliver phenomenal Cetaphil performance, but also on Sculptra, has really shown the way for all of us how strong. But they have also shown what the potential of this product.
Yes, it is probably going to get even more competitive, but if you are premium, high science, clearly differentiated, has the best product, I am sure we will do fine.
Thank you. We will now take our next question. This is from Thibault Boutherin from Morgan Stanley. Please go ahead.
Thank you. Just a question on the overall fillers and biostimulator outlook. The annual growth for this combined franchise was around [7%-9%] range over 2024, 2025, and 2026 should also be in that range based on your indication. But if we look at the composition of sales within that bucket, it has changed a lot over the period. Fillers have been a bit softer. Sculptra has a very strong performance. Now I think it is approaching close to half of revenues. Should we expect to see an acceleration of this category as Sculptra is representing a larger share of revenues and having more of the growth? Basically, when you think about the overall bucket, should we see growth acceleration coming in?
Well, we report it combined, and we also look at it combined because we are seeing that consumer preference has changed. For some fillers, there is less demand or there is more price competition. For Sculptra, we continue to see very strong demand. Consumers are shifting a bit more to skin quality, natural, to the fact of stimulating your own collagen. Sculptra has a lot of the features that it has. I am not going to predict what the filler part of this is going to do. Some people say it is stabilized, some says we have seen the nadir of that. What we see is it seems to be more stable, but the most important, which is also what we are doing is, you need to continue to innovate. We are coming out with Restylane SHAYPE.
We are coming out in China, the Restylane Volyme. We are celebrating the 30 years of the Restylane range. We continue basically to differentiate, but I do not think that it is going to be accelerating.
Thank you.
Thank you, Flemming. I think this was the last question. Before we wrap up the call, I would actually pass back to you so that you can wrap up the webcast.
Yeah. First of all, thank you for your time and your questions today. One clarifying thing I saw today that is very important for you to understand. When you are a high growth company, you do not give people their full budget from the beginning of the year. People come and compete for the last 20% or 10% of their budget so we can direct growth and investment to where we see most growth opportunities. Yes, there is always part of the business, whether it is the fillers in certain countries or other products in other countries, but I think whether you look at our mature prescription portfolio, whether you look at our overall performance in fillers and biostimulators, we continue to do really well.
The good news is you can always shift resources around, and having a broad-based, actually the broadest based portfolio, gives you a lot of leeway to continue to drive growth and allocate resource in appropriate manner. There are many people behind and many reasons behind that we delivered a record net sales for the first nine months of the year. But we have a team that is totally execution-focused, that also can deal with adversity or political tariffs and other things and find ways to still show very strong growth. How do we see that? It is a very broad-based growth. I think most of our top 10 countries showed double-digit growth. We had also double-digit growth across our product categories and across the geographies. U.S. was a little bit stronger this time than international, but both of them very impressive results. We like innovation. We like science.
We like tuck-ins. The ZO Skin Health fits very well strategically. We found it was financially attractive, and I think it speaks to our wheelhouse, and we will increase our customer base, our product offering, and we think that is very important. We are very confident in our growth trajectory. We will continue to invest behind the growth opportunities we have, and we will continue to see that we are very optimistic about the outlook, also why we increased the guidance for the remainder of 2026 to 22.5%-23.5%. I think both the first nine months and the third quarter showed very strong results. With that, I first of all want to thank you for your patience, but once again, thank the amazing team we have at Galderma that drives these results.
Thank you. This concludes today's conference call. Thank you for participating, and you may now disconnect. Speakers, please stand by.