Earnings Call: Q1 2021

Apr 29, 2021

Good day, and welcome to the Bristol Myers Squibb 2021 First Quarter Results Conference Call. At this time, I would like to turn the conference over to Mr. Tim Power, Vice President, Investor Relations. Please go ahead. Keith, and good morning, everyone. Thanks for joining us today for our Q1 2021 earnings call. Joining me this morning with prepared remarks are Giovanni Our Board Chair and Chief Executive Officer and David Elkins, our Chief Financial Officer. Also participating in today's call for Q and A Chris Berner, our Chief Commercialization Officer and Samit Herawat, our Chief Medical Officer and Head of Global Drug Development. As you'll see, we've posted Slides to bms.com that you can use to follow along with for today's remarks. But before we get started, let me read our forward looking statement. During this call, we will make statements about the company's future plans and prospects that constitute forward looking statements. Actual results may differ materially from those indicated by these forward Looking statements as a result of various important factors, including those discussed in the company's SEC filings. These forward looking statements represent our estimates as of today and should not be relied upon as representing our estimates as of any future date. We specifically disclaim any obligation to update forward looking statements even if our estimates change. We'll also focus for comments on our non GAAP financial measures, which are adjusted to exclude certain specified items. Reconciliations of these non GAAP financial measures to the most comparable GAAP measures. Giovanni? Thank you, Tim, and good morning, everyone. Let me start by saying that I'm proud of our continued strong execution during the global pandemic and the significant progress we are making against our strategy. I want to recognize and thank our global employees for their hard work And resilience through this challenging time. Now turning to Slide 4. At the start of the year, I laid out our strategy to grow our business and renew our portfolio through the end of the decade. During the Q1, We delivered strong results consistent with this strategy. We successfully grew our revenues, launched new medicines and new indications and continued to advance our pipeline. Starting with our financial performance, Our revenue grew 3% despite the impact of COVID-nineteen related buying patterns in Q1 of last year. Our quarter was strong for sales and EPS in the context of COVID related dynamics For some of our products, based on continued strength in our business, we are affirming our full year non GAAP guidance for 2021. The accelerated renewal of our portfolio advanced across all 4 key therapeutic areas. Through regulatory approvals and clinical readouts, we're building a more diversified younger portfolio That will fuel our growth through the decade and beyond. Although there remains uncertainty with how the COVID recovery will evolve, We are actively planning to return colleagues to the workplace and are prioritizing plans to fully bring our sales reps back in the field where conditions allow to further support our in line products and launches. Let's turn to our execution scorecard on Slide 5. I am pleased Combined with our opportunity for cancer, Opdivo can become the leading IO medicine for patients with early and advanced We have strengthened the growth and long term franchise with a positive Phase 3 clinical trial for elaclimab. We're now the only company with 3 proven Building on our leadership with Yervoy regimen, We've now demonstrated a clinically meaningful PFS benefit on top of PD-one monotherapy for a second IO agent, which is a great accomplishment knowing the high efficacy of PD-one monotherapy in first line melanoma. This is great news for patients with advanced melanoma, and we look forward to presenting the data at ASCO in June. Beyond IO, 6 of our 8 near term launches are now successfully underway. In hematology, we made great progress in our cell therapy franchise with U. S. Approvals of Brienzi and Abekma. Our other new product launches are also progressing well. A lot is happening in immunology. We presented Phase 3 data for DUKRAVA, which we expect to file later this year. We see this as an important medicine for patients and the company with significant revenue potential. As you know, DUKRAVA is a 1st in class selective TYK2 inhibitor with The potential to become the new oral to severe psoriasis. It also has In our mid stage pipeline, we initiated the Phase 3 study for Zendeskimab in eosinophilic esophagus. In CV, we filed mavacamten to update you on the progress within our pipeline and how that further supports the long term potential and reinforces my confidence in our ability to capitalize on the potential for future growth. We remain focused on growing our business between 2020 2025. More importantly, we expect We believe our new launch portfolio has To close, I'm confident we have established a strong foundation for our future growth. The strength of our execution, Promising launch opportunities ahead, the breadth of our pipeline and strength of our balance sheet positions us very well. I will now turn it over to David to walk you through the financials. David? Thank you, Giovanni, and thank you all for joining our call Today, I'd like to start with our strong top line performance on Slide 8. Our continued sales growth of 3% was driven by strong operational performance. When excluding the approximately $500,000,000 of COVID related buying patterns we experienced last year, underlying sales growth was strong, up 8% I'll now provide additional color on the performance of our key brands and new launches, starting with Eliquis on Slide 9. This is another strong quarter for Eliquis as global sales were up 9% despite the unwinding of the 4th quarter inventory build And the approximately $350,000,000 COVID related build we experienced this time last year. In the U. S, 1st quarter sales increased 8% versus prior year, driven by strong demand with total prescriptions up 11% due to the strength of our position as the number one NOAC. 1st quarter sales also included the impact of a one time true up of approximately $160,000,000 related to the Medicare coverage gap. As we look towards the second half of the year, we expect similar dynamics from the coverage gap as we've seen in prior years. We remain optimistic about the continued growth opportunity for Eliquis since we've seen both new to brand Internationally, Sales remain strong, growing 11% continues to be the number one NOAC in multiple key markets internationally With significant room to grow, we remain very pleased with the execution of Eliquis around the world and expect to continue to grow Eliquis share within a growing Now turning to our Q1 performance in the U. S, first line lung shares remained in the low The launch of our Opdivo plus cabo indication in first line renal is going well Though we did see some impact from COVID during the quarter as the resurgence of the virus earlier in the year impacted office visits and infusion, We remain very confident in Opdivo's return to growth this year. Further supporting this growth, we are also very Pleased with time as Opdivo Plus Chemo is now the first IO regimen approved in first line gastric cancer. We look forward to launching additional indications in early stage diseases across esophageal and muscle invasive bladder cancers, which which are expected to further contribute to our growth later this year. Additionally, we have multiple opportunities for future growth, including CheckMate 648 For treatment in first line esophageal cancer, which we announced net as primary endpoints as well as from other trials that we'll read out over time. Outside the U. S, sales were up 2% due to favorable effects of foreign exchange. We are encouraged to see strong adoption of new approvals and increased reimbursement, including the 9LA regimen in Europe and both 9LA and 227 regimens in Japan. These dynamics offset the second line indications and the impact of COVID. Looking forward, We expect to expand the use of Opdivo and the review. All in all, we remain very excited about the growth outlook for Opdivo. On our in line multiple myeloma portfolio, in the U. S, Revlimid sales were flat as growth was offset by the expected work down of last quarter's inventory build. We also saw the expected seasonality that Patients entering the coverage gap early in the year. Outside the U. S, we saw a 4% increase primarily from foreign exchange, as well as strong demand for triplet based therapies, which offset the approximate $100,000,000 combined impact of an inventory build in the tender last year. This resulted in a 1% increase for Revlimid globally. Global POMALYST revenues were up 8%. This was driven by overall strong demand from Now we want to spend a few minutes sharing the progress we've made in the quarter on our recent launch is on Slide 12. Our launches contributed $145,000,000 in sales in the quarter. Let's start with Grevazil, which generated $112,000,000 in the Q1. We continue to reap starts. We continue to see the transition from initial bolus underlying demand. And while this market has seen some COVID impact, we remain focused on continuing to drive new starts for Our initial launches in international markets are going well and we will continue to add markets Moving to ZYPOSIA, where we continue to see good traction establishing the brand as the patients convert to commercial supply at a quicker rate than before. Beyond multiple sclerosis, we look forward to launching symposium ulcerative colitis with FDA approval expected at the end of May. Outside the U. S, we are pleased with Saposi's MS launches in several markets and we will continue to secure reimbursement in additional markets as the year progresses. The marketing authorization application for ulcerative colitis Also remains under review in Europe with approval expected toward the end of this year. Turning to Onuray, we continue to be encouraged by the launch in a new maintenance segment of the AML treatment paradigm, which we know will take some time. Outside the U. S, we recently received a positive opinion from the CHMP with approval expected this year. Turning to our newly established cell therapy franchise on Slide 13, We are very excited to have launched 2 differentiated cell therapies for patients, following the recent approval of Briyonzi in large B cell lymphoma And Beqna in multiple myeloma. First, regarding Briyansy, our best in class CD19. While we are early in the launch, messages around efficacy and out Patient utilization are resonating with high aided awareness among CAR T treaters. We have also been very pleased with the rapid activation of our treatment sites as we now have approximately 55 sites activated with patients already apheresed and recently infused. And as it relates At Beckman, we're excited to have the first ever BCMA CAR T approved for patients with glioma. We were just a few weeks into the launch. We're encouraged by the enthusiasm we're hearing from customers for the treatment. We also see a real opportunity for synergy from the combined execution of these two therapies Expanding the site footprint through rapid account activation and maximizing our differentiated profiles while ensuring a seamless customer experience. Now let me take you through a few items on the P and L on Slide 14. First, as we have said, our gross margin will continue to be largely a function of And the first and then impacted by the strength of Eliquis in addition to foreign exchange, which reflects our earnings mix for the balance sheet and our capital allocation on Slide 15, Our liquidity position remains strong with approximately $13,000,000,000 in cash and marketable securities, including strong cash flow on operations of nearly $4,000,000,000 in the quarter. Regarding capital allocation, business The company and we will continue to evaluate opportunities to complement our internal innovation. With With regard to our debt reduction this quarter, we've denigrated credit rating by accelerating our repayment of debt by a $4,000,000,000 tender and redemption. We are also committed to returning cash to shareholders through dividend and share repurchases. Recall that we increased our share repurchase authorization by $2,000,000,000 at the at the start of the year and that we plan to buy back between $3,000,000,000 $4,000,000,000 in shares this year. In the Q1, we have already repurchased $1,800,000,000 to our debt goal and we will remain opportunistic as we continue to invest in our capital allocation. Turning to our 2021 guidance on Slide 16. Following this quarter's performance, we are reaffirming our non GAAP guidance for the year, which reflects significant growth over last year. Our businesses have remained resilient and our launch opportunities are coming to fruition. Again, I'm pleased not with just the performance, but also with the Considerable progress we made in executing our launches and advancing our pipeline. I'd now like to turn the call back over to Tim Giavani for K and We'll go for our first question, please. Thank you. We will now take the question from the line of Alex Dillon of Goldman Sachs. Please go ahead. Great. Thanks for taking the question. It looks like the clinical trial DUC8 Phase 2 study in total knee replacement is now showing a completion date of this month. So just wondering if we could actually get data from that trial here over the near term. And then looking back at enoxaparin's rate of bleeding in this setting, it looks to be about 4% to 5%. So just wondering what level of differentiation Thank you, Terence. Good morning. Samit, I'll pass the 2 questions on Factor 11 to you. Thank you, Terrance. Looking forward to the readout of the first trial in the total knee replacement setting, which is testing the single agent Factor XIa in the next couple of months As we look forward now and also as we've spoken before, the second trial will read out in the early part of next year as well. In totality, we'll be the one determining factor to really ascertain truly the overall safety and of Of course, what we can gain in terms of efficacy to define the plan as we move forward. So more to come on that. I will not go into specifics of What level of improvement we are trying to look for, those are going to be defined with the differences that we see. But again, we've said before, If we can produce another agent for prevention of clotting and thrombosis At the level that is similar in efficacy, but better safety profile, that is what we're looking for and certainly looking forward to the data in combination with antiplatelet Thank you. Thanks, Sumit. Keith, can we go to our next one, please? We'll now take our next question. It comes from Chris Schott of JPMorgan. Great. Thanks so much. Just two questions here. Maybe first, just maybe elaborate a little bit more in terms of LAG 3 and its role in the market. I guess, should we be Are you talking about this combo Motorpe competitor or is this something you think from efficacy standpoint can stand up against And then, Opdivo, your VoIP type. And then, Opdivo, your VoIP type. And then, Opdivo, your VoIP type. And then, Opdivo, your VoIP type. And then, Opdivo, your VoIP type. And then, Opdivo, your VoIP type. And then, the As we think about kind of treatment rates and development, we think about the esophageal and bladder kind of Ramps as we think about kind of this year. So are these big 2021 events or is this going to take a couple of years to really see the opportunity for those indications? Thanks so much. Thank you, Chris. So first on like 3, let me share my enthusiasm for a fixed dose combination, which represents It's really important data to validate a 3rd immuno oncology agent from the company. And let me ask Chris to give you his perspective on dynamics in melanoma and where that fix dose combination may play and then give you Insights into the FDA in adjuvant. Yes. Thanks for the question, Chris. So let me start with LAG-three. So first, let me say that we are very excited and pleased The data readout that we've seen for the 3rd IO that we have for encouraging and I think seeing In enhanced activity, on top of Opdivo and melanoma, that's a pretty high bar. And so we're excited about the opportunity to bring this to patients. In terms of where it You remember the current landscape of first line melanoma, VIVO YERVOY represents about 35% to 40% of first line melanoma. Approximately 30% of this market is still single agent IO and you've got another 30% that is non IO. So we think there's a real clear opportunity here For us to drive the benefit of relatinib plus Opdivo into that population, there's clearly a continued unmet need with physicians looking for additional that have a dual IO like effect and we're looking forward to bringing that combination to patients as we work our way through the regulatory process. In terms of the adjuvant opportunities, again, this is going to be an important opportunity as we get into the latter half of this year And certainly as we look about look for the growth opportunities beyond 2021, you noted Esophageal and the upcoming opportunity with Bladder, we're very excited about those. With adjuvant esophageal, this is a substantial patient population The treatment rates here are relatively low today, just given the lack of approved therapy. So we would anticipate that over time, We'll be able to drive utilization both in terms of the patients who are being treated today, which is relatively small, Over time, much the way we did, you'll recall, in adjuvant melanoma, and we would expect a similar dynamic to play out as we launch in bladder cancer as well. And so Very excited about those opportunities and look forward to seeing how those launches play out in the coming months. Go to our next question please, Keith. Our next question comes from Seamus Fernandez. Great. Thanks for the question. So I wanted to follow-up on Chris' Question as it relates to LAG-three. I noticed at the as one of the ASCO abstracts, There's also an adjuvant trial that is supposed to report some data. I assume that this is just A single arm trial, but what's Bristol hoping for in adjuvant melanoma in particular, as well as The planned acceleration of the non small cell lung cancer opportunity, just hoping that Samit could maybe Opine a little bit or give us a little bit of visibility on where he sees LAG-three kind of potentially fitting in on the lung cancer side? And then separately, just wanted to get a little bit of a better sense of your thoughts around the I broke the SPPS trial with Factor XI, still first half of next year. And maybe you could just Remind us of the opportunity that you see there. In our view, we think that could be a $4,000,000,000 plus that's really not reflected in expectations, but nobody knows this space better than Bristol Myers Squibb given your experience with Plavix. Thanks. Thank you. Thanks, Seamus, and thanks for the question. So let me just say before I pass it to Samit, to answer both of your questions that we really look forward to presenting the LAG-three data at ASCO. I think it's going to be a great opportunity to show The strength of the data and on Factor XIA, let me just agree with you. This is a space we know extremely well where we've demonstrated our ability to be successful with Plavix, of course, going back a few years and with Eliquis' we're seeing as we speak now with the current performance of Ovelediculous. Samit? Yes. Thank you, Giovanni, and certainly very excited to See the data coming out, great for the patients and certainly very happy with where we're going in the pipeline for LAG-three in oncology for BMS as well. Overall, the natural progression after seeing the data in the first line setting of addition of relaplimab on top of nivo Would be to go into the adjuvant setting and that's where you're beginning to hear a lot more that we'll be progressing into a Phase 3 program In the adjuvant setting for this co formulation that we now have as a fixed dose combination for Opdivo plus Certainly, more to follow as we look deeper into the data for the metastatic trial to gain More in-depth knowledge on the biomarkers as well as the long term follow-up that will come from the current forty seven trial That will continue to evolve in terms of our knowledge. Now the second part which you asked is about the non small cell lung cancer opportunity. Certainly Excited to have started the early pox generation trial as we're looking at the combination of nivo plus rilaplimab plus chemotherapy to see where we can take it and that's the idea behind accelerating the enrollment in that trial, so that by the end of the year, We can initiate a Phase 3 program in that setting if we have tolerability that is demonstrated in that early trial that we're looking at. In addition to that, You'll continue to hear evolution of the data potentially in hepatocellular carcinoma that we are looking also to have some look into in the Phase 2 study And that can open up additional indications as we look forward. Beyond that, in the SSP trial, yes, we are still looking forward to the readout in the early part of 2022, as I said earlier, there are 2 opportunities. Opportunity number 1 is to improve on the current anticoagulation paradigm with a single agent. And then opportunity number 2 is to expand the use of anticoagulants to the background therapy of antiplatelet Together, we'll form the basis of the clinical development plan that we are thinking through, whether it be the venous side or the Your next question comes from Tim Anderson. Thank you. I have a kind of a higher level question on the PD-one Can you comment on whether price competition in this category It's kind of imminent or eventually will happen in developed markets, both U. S. And Europe. The space is clearly getting more crowded Both domestically produced PD-1s as well as those sourced from Chinese biopharma companies. And while price competition Usually it's not a winning strategy. It might be the only lever lots of these other companies can pull. And I think at least in China as many have started to recognize the P1 category has become a commoditized class. So lots of folks are trying to figure out what precludes this From happening outside of China, can you articulate your views here? Thank you. Thank you, Tim. Let me ask Chris to give you Our perspective on a really important topic. Yes. Thanks for the question, Tim. We obviously think about this quite a bit. As we think about the number 1st, there's the competitive impact of having additional players We have a good track record of competing in these markets. And while we're always a bit paranoid of potential new entrants, we We feel very good about our ability to the second dimension that we look at is the one you're raising, which is the risk of commoditization of a market. And And the way we look at that is commoditization, we think, requires 2 things. It requires a low cost entrance and It requires perceived interchangeability on the part of the risk of both of these things Coming together likely varies, we believe, by geography, health and therapeutic setting, but we pay very close attention to this. In terms of The risk, we absolutely believe at some point, very dynamic. Currently, the areas where we see the greatest risk Don't overlap with our largest markets, plans to address the risk as they become more tangible. The 2 things that I think we can continue to do that position us well against this leverage of the extremely broad data set that We have generated an IO to ensure that treatment decisions continue to rapidly bring new data and approvals to market Such that we're constantly pushing forward innovation and changing the standard of care. But this is an area that's very dynamic and we're paying close attention to it. Thanks very much, Chris. Can we go to the next question please, please? Thank you. Our next question comes from Geoff Meacham of Bank of America. Please go ahead. Hey, guys. Good morning. Thanks for the question. Just had a couple of quick ones. On your new launches highlighted on Slide 12, what were some of the headwinds you saw for roblozil this quarter? And then what do you think could be the tipping point for And then the second question is with your cell therapy franchise, I know it's early, but Just given the proximity of the 2 launches, are there synergies that you're seeing just with respect to site activation or reimbursement, etcetera? Thank you. Thank you, Jeff. Chris, why don't you go ahead? Let me just give you my I'm really excited with what's happening on the front of our launch brands, The profile of the medicines, we have strong labels. And what we are hearing in terms of the potential role that these agents will have in the marketplace. Let me just ask Chris to give you More insights into some of the launch dynamics you referenced, Jeff. Sure. Thanks for the questions, Jeff. There's a lot there. So let me try to hit on each of these relatively quickly. So Revlazil, We're very pleased actually with the continued strong execution of the teams and what we're hearing on Rev Brazil. And our expectations for growth this year and certainly in the long term remain As for the dynamics that we saw in the quarter, sales were relatively flat Q4 into Q1 and there were really two factors underlying this. First, As you will have heard from some of our peers, we have seen new patient volumes down in Heme. They were down about 10% to 20 And we have seen some of the factors that play at least for the quarter. And we have seen specific to Revlisil a bit of a prolonged bolus washout period. And to give you some context around that, in Q4, we estimate that bolus patients for REVLZILUSTIN were roughly around 40% of the overall business. In Q1, that has come down to about 20% to 25% and And we would expect those patients to continue to come off therapy over the coming months. Those two dynamics notwithstanding, we are very encouraged by the continued uptake of new patient Starts in this setting and continue to see new trials and an expansion of the prescriber base, which is critically important at this point in the launch. So Continued excitement on our from our perspective with respect to REVLIZO. On Eureka and supposing in terms of pivot points, I would say, As we have discussed in MS and as you've seen with some of our peers, it does take time to transition patients from written to commercial dispensation in MS. That said, it was a big focus area as we discussed last year and we are seeing very nice acceleration for ZYPOSE and MS. And of course, we have the opportunity and you see coming up with the PDUFA date in a month or so. And that's obviously another important opportunity for Zipposi and very much look forward to bringing this differentiated product and mechanism into IBD. Onurag, we're in the process of creating a market with Onurag, and that launch is going very well. In fact, we saw patient demand volume increase about 50% from Q4 coming into Q1. And I would say, in that space, we're very excited with what we're seeing. Now again, it's a market where we're creating a new treatment paradigm and that's going to take some time, but all indicators are that The efficacy profile of this data is landing well with customers and again the teams are executing well. And then pivoting to your question on cell therapy, We're very excited about the 2 cell therapy launches. Both products have been very well received. Given Briyonzi has got a little bit more data in terms of the launch Timing, let me start there. The launch there is going very well. We've had over 50 accounts that have been activated already. Our highest priority accounts, in fact, were activated within 8 weeks of approval. The messaging around the best in class profile for Briansy is landing well. Physicians are clearly seeing a differentiated safety profile. And in fact, we've already infused And so I would say the execution there has been exceptionally well. And just quickly on Abekma, Obviously, a bit earlier in the process for Beqma, but we have the advantage of launch advantage of launching that product on top of the infrastructure that we've built with Briandzi. So we've actually been able to more rapidly activate sites there. We've had 25 centers were activated within 10 days of approval. The physician feedback has been very positive and there's a lot of enthusiasm for us bringing the 1st BCMA targeted cell therapy into Multiple myeloma. So, so far early days, but the launch is going to be off to a very good start. Thanks very much, Chris. Can we go to the next question please? Our next question comes from Andrew Baum of Citi. Please go ahead. Many thanks. First question is Giovanni. In relation to business development, Bristol, we anticipate it's going to be more active than many of your peers given the cadence of LOEs you have in your portfolio. The FTC has been making increasingly loud noises about of increased drug prices and Loud noises about of increased drug prices and diminished patient access. How you think this could impact business development going forward, whether it's more noise than actions And what we should be looking for is to determine whether M and A relates in anti competitive activities? And then second question is for Samit. Perhaps you care to comment on whether to assess JAK safety broadly in a cross divisional way. And I'm obviously thinking about ducravatitanib in terms of its Thank you, Andrea. Let me start with your question on business development and then Samit will follow on your second question. So it's really difficult to speculate at this point in the early days what the evolving position A couple of things that I would say is, number 1, I do agree with you that business development is an important priority for us. It has been for a while, and it will remain one of the priorities for deploying capital and our capital allocations. One thing that I'd like to say is that I actually feel that we've demonstrated over and over that when we Acquire assets into the company, it's actually a way of accelerating their development and generating even more of An important element of what drives our business development strategy. I feel there are plenty of opportunities to continue to strengthen our portfolio across all of the areas where we have presence and expertise, and obviously we'll always take, competition issues into Differentiated Business Development Strategy. So with that, Samit? Yes. Thanks, Andrew. And certainly, yes, we've heard the speculation around I'd comment on the slide from a safety perspective for DYK2 inhibitors and whether they belong in the JAK2. The way we think about it is, as we are presented, If you look at the data, we do believe it is very differentiated and they are absolutely thinking around preclinical data, the clinical data, the mechanism of action And the way the data has evolved also on the efficacy side. So overall, I think we have very strong arguments. If there is an ADCOM, certainly we'll be prepared with that with all the data that we've shared already and we'll continue to evolve in terms of long Some follow-up as well. We do believe it's a new first in class molecule for a TYK2 as a TYK2 inhibitor. Potentially first, as we go along, we are looking forward to sharing more as we go along. At the current time, we are in discussions in terms of preparing the file and getting it through the regulators and move it forward. Thanks. Keith, can we go to the next one? Our next question comes from Ronny Gal of Bernstein. Good morning, everybody. 2, if I may. First, the office has now come out to restructure part I'm from the public inside. I was wondering the relative impact of pharma participation in the cost structure And how does that translate into your own revenue? And second, I was wondering how You're going to handle the difference in prices for Zeposia between the MS market and the IBD market, 2 different price bands and You're understanding that. So how are you thinking about HEMLIBRA? Hey, Ronnie, it's Tim. We couldn't quite hear the first part of your question. We heard the part about the Price, I'm Zamposia, could you repeat the beginning of your question, if you don't mind? Sure. Part D restructuring, could you give us a feel for how kind of like a 10% hit Okay. Thank you. Thanks very much. Let me start there and then I'll ask Chris to address your question on Zipposia. So let me say, obviously, there is That may be discussed by the administration. And I think it's premature Assessment of what the RD redesign may what elements may be discussed going forward. I think what's important It's a couple of things. So first of all, as you know, we have a very diversified portfolio across multiple payer segments and multiple therapeutic And so there will always be different impacts on different parts of our portfolio from any benefit redesign. There are very different dynamics for a product like Revlimid Verdequis. So that makes it difficult to give you any insights into impact of Reforms because it really is important to know the details. What I think is more important is the fact The priority that the industry has, the proposals that we'll continue to make As we interact with the administration, we'll be focused on elements of Part D redesign that include We are now establishing out of pocket caps, reducing the overall impact to in the catastrophic expenses throughout the year. And so as proposals progress, I think it will be Chris? Yes. Thanks for the Obviously, we are keenly aware of the differential in this market and UC. As you know, we priced Zipposia, it's in line with the value it provides in insurance market. And as we think C. Butler:] It's certainly too early at this point to discuss how we're thinking about price day is that we're going to factor And we have plans in place That will execute as we get closer to the approval of Zipposier and UC, but it's something we've been focused on for some time. Thanks very much, Chris. Can we go to the next question please, please? Our next question comes from David Risinger of Morgan Stanley. I have two questions, please. First, could you just discuss Bristol Myers set in first line melanoma with a combination of Opdivo plus Yervoy. Just so we have that in context ahead of the lag 3 readout ahead, Could you provide a framework for Zopposia sales drivers in coming years in both the U. S. And ex U. S? Thanks very much. Let me ask Samit to start and give you his perspective on first line Chris can add any perspective there and give you an answer on ZYPOZIA. Yes. Thanks for the question, David. The way to look at it So as Chris mentioned earlier, there's still a large number of patients who are treated with either single agent IO Or through non Hyo regimens. So yes, O plus Y is a very important regimen, has shown very important And so therefore, the company is now bringing is an additional, It's a treatment potential for patients who can be treated who have melanoma in the first on top of nivolumab as a single agent. And that's the reason why we're excited about this to be able to add to the treatment paradigm For prescribers and for patients to potentially use in the future once approved in this particular setting, One has to remember safety profile and its differentiation over here. So rilatimab plus Yes. And then let me take the question. So the way we think about ZUPOSI is, first of all, we're very excited about the opportunity And ex U. S. And MS, we think that Zposia brings a very differentiated profile into this market. It's now in the U. S, the number one SP in terms of written prescriptions. We're gaining on oral agents. We are making progress in terms of optimizing the patient pull through in terms of we've got considerable opportunity We continue to grow in the short term in MS in the U. S. Ex U. S, it's still very early days for the launches of Zposia, But I would say that in the early launch markets in Europe, Zposia's uptake appears to be very good, particularly in markets like Germany. So I think in the near term, There's going to be clearly a focus on maximizing the opportunity that we have with Ephesia in that market globally. And then, of course, with the upcoming launch in UC, that becomes a much More important opportunity for us as we get into 2022 and beyond, Zposia's profile looks very good. The feedback We've gotten from treaters in the IBD space is very positive. Obviously, the rate limiter in terms of the U. S. Uptake is going to be accessed. We know that's a very important component, and we're going to approach that in a very stepwise fashion. It's going to be important that we drive volume initially in those With those patients who have insurance that is open or relatively unrestricted, And then we'll leverage the Zposia profile to drive additional utilization and then, of course, work with payers to ensure that we continue to increase The access that patients have in that space, that will clearly take some time, but we think the opportunity in IBD for ZYPOSI is substantial, And that will be important both in the U. S. And ex U. S. As we get into that launch later in 2021 and then certainly 2022 and beyond. Thanks, Chris. Can we go to the next one, please? Our next question comes from Greg Gilbert of Truist Securities. Thank you. On LAG-three, how are you thinking about the importance of biomarkers here and what level of granularity should we expect around the data as it relates to LAG-three positivity, etcetera. And then Giovanni, a different twist perhaps on the biz dev question. When you took over as CEO, I imagine there was quite a sense of urgency to diversify the company. But with the steps you've already taken to do so, Would it be fair to characterize your M and A strategy from here as more about enhancing existing franchises and less about diversification as a Thank you, Greg. Let me start there and then I'll ask Samit to give you And answer on the biomarker strategy for LifeTree. I think you're absolutely right. I believe that one of the things that is A clear strength for the company today is the diversification of our business. When you look at our oncology business, Tumors and Hematology, what's happening in immunology, which is clearly the fastest growing segment of our business right now and the long term sustainable I think that we have an incredibly well diversified Set of businesses with strong dynamics for all four of them that we've built for the company. And at this Point, I see that as an opportunity because we have capabilities, that we can leverage. We clearly have deep expertise, whether that's from a Scientific and development perspective or from a commercial perspective, growing in all of those areas and it gives us an opportunity And maximize the value of those assets. So the priority for us now in business development is across all of those areas to continue to strengthen our portfolio. And as I've mentioned several times, the objective that we have is to further strengthen the outlook in the 2nd part of the decade, but our business is extremely well diversified at this point. Sanath? Thanks, Greg. Thanks, Giovanni, and thanks, Greg, for the question as well. For LAG-three, obviously, I will not get into the specifics of the data that we presented at ASCO, But certainly some of the biomarker data will be included in the presentation. As you might recall from all the published literature around Lactria and in general for IOs, It's been a difficult exercise to get specificities around which biomarkers really dictate the activity of the medicines that we are testing and exploring. So we will continue to get into that into deeper details after the data are presented, But certainly looking forward to a better understanding of the overall landscape and as we look to the combinations and other indications as well. Thanks very much. Go to the next one, please. Our next question comes from Matt Phillips of William Blair. Just two quick ones. Can you give us any update on timelines for an EFS look and the CheckMate 816 trial? And similarly, how do you think The overall market there, the potential opportunity there is impacted by the Roche and Power010 positive announcement. And then secondly, on the TYK2, given the strong results You saw in the moderate to severe patients and then also the Otezla advanced study in mild to moderate. Any plans to maybe run an additional head to head study versus Thank you, Matt. Let me ask Samet to address both of your points. Well, the second one probably I'll pass it on to Chris. The first one, I will say that for EFS for 816, You've seen the data already for the pathological compute response. It's certainly very, very encouraging. Looking forward to the EFS readout towards the end of 2022, early 2023 timeframe. So it still remains from that perspective on track and we'll Certainly, we'll be sharing it as soon as we have that data available. Just one more thing that I want to clarify what I said early on. On Andrew's question around the speculation around the AdCom, we And we have no knowledge around inclusion of TYK2 as being included in there. And that's why I just want to clarify one more And let me just very quickly hit on the commercial opportunity for 816 and then turn it back to Samit on tick. We're happy with the results, obviously, that we've seen so far with 816. As Sumit just mentioned, the data continue to emerge in this space. What I would say is that this is a there are about just shy of 30,000 treatable patients here. The treatment rates are immune. So we think there's an opportunity to do 2 things: provide an opportunity in the neoadjuvant space for those patients who are being treated today and potentially continue to push And remember, many patients will be identified once you have more active treatments that are available in this space. So we think there's considerable opportunity here. Amit? Great. Thank you. And in terms of the 2 versus OTEZLA, as you brought up. I think, first of all, we are excited obviously the mechanism of action that is quite unique over here. We've Seeing the data in the moderate to severe psoriasis, we have additional studies that are ongoing in the IBD space, in the lupus space. The discussion around moderate to severe mild to moderate psoriasis continues and we'll certainly share with you Truly excited today where we are and certainly the evolution of the data at the end of the year in additional indications. We are not ready to share yet our plans for mild to moderate Our next question comes from Steve Scala of Cowen. Thank you. A couple of questions. Based on everything that has been said, it sounds as though the relatinib data is not Competitive with Opdivo plus Yervoy on efficacy, it might be on safety or am I misinterpreting? For instance, You mentioned adding to the armamentarium, but not advancing it. You referred to many patients on monotherapy or not receiving IO, but you didn't really refer to those on IO. So, I guess, what we should interpret and will full data be in the abstract on May 19? 2nd question on slide on Page 6, of the 90% of products in the continuing business, Should we think about Opdivo plus Yervoy comprising about 50% of that 90%? Thank you. Thank you, Steve. Let me just provide some perspective. So to answer your second question, as we've said, 90 And of the business by 2025 being continuing business that excludes Revlimid and PONALIST, In that 90%, we said about a third are the launch brands. The rest is the current online portfolio. We're not breaking That's 70% down further into individual products, but I think what's important there is actually the strength of the emerging Business for the remainder of the decade and obviously the launch brands become particularly important and given that we're discussing 2025. Let me just reiterate our enthusiasm for the ralatimab, The low fixed dose combination in melanoma. It is clear that we have a very well established standard of care with O plus Y and long durability of response demonstrated over a long period of time. But I just want to again reiterate this from an efficacy perspective, from a safety perspective, we're really excited to be able to show the data at ASCO Sumit? And Steve, the point I would add is, look, we did not do a study of nivolumab plus rilaplimab versus nivolumab plus Ipilimumab. So it would be unfair to start comparing the data for the two trials. Secondly, nivolumab plus ipilimumab, as Chris has said earlier, As Giovanni just said, has been established for a long time, so we have long term data, overall survival data, response rate data. For elastimab, we do not have the overall survival data as well as the response rate data, but we are excited to see where we stand with our overall progression free survival data as compared to single agent nivolumab and you'll see that data very soon and certainly we can have a dialogue after that. But as Giovanni said, very pleased where we are and certainly looking forward to the evolution of the data as we go forward. Thanks so much. Can we go to the next one please? Our next question comes from Luisa Hector of Berenberg. Hello. Thank you. I wanted to return to the Zetovia, please. We've been launching into COVID. I'm just wondering which patients are starting on Zekosia and do you expect that to evolve? And then on the UC indication, are you anticipating an ADCOM? And could you update us on how you're preparing for launch? Thank you. Chris, sure. Let me start and then I can maybe turn it over to Sumit for the Adcom question. So very happy with the Performance of Zepozia in MS, particularly as you point out in light of the COVID environment. This was, as we had talked about last year, a market that was hit And so at the end of last year, we spent a considerable amount of time making sure we were engaging with customers in many cases for the first And so our focus was continuing to do a few things. First, it was making sure that we were selling the profile for this, what we believe and clearly is being demonstrated in the data. Number 1, SP in this market. We've seen very good uptake in terms of written Obviously, the dynamic pool of MS is relatively small, and we've seen most of the business at At this point coming from switch patients and we're continuing to get an increase in new patients who are coming on board as well. So we're very happy with that and we would expect that to continue to evolve over time. And then obviously, as I mentioned in one of the previous Questions. A big focus for us has been making sure that we continue to convert those written scripts into commercial dispense and ensuring a very smooth Journey for patients in this market, and we've had a great acceleration there. So excited about what we're seeing so far, and we think we're on Very good trajectory for Zepozia and us in the U. S. Amit? Yes. And just very briefly on ulcerative We are already at the end of April. Our PDUFA date is end of May. We have heard nothing but very good conversation with the FDA. So we have no knowledge of an adcom for otitis otosiposia. Thanks. I think we've got time for maybe 2 last ones. Keith, can we go to our next one, please? Thank you. Our next question comes from Dane Leone of Raymond James. Please go ahead. Thank you very much for taking the questions and congratulations I know it's late in the call, but thank you for taking the questions and I'll keep this, I guess, briefly brief. A question we get a lot from investors is how I think about the multiple mile on the franchise over the next couple of years and your market share collectively within that. Obviously, you have some moving pieces with REVLIMID with some offsets with Bebeklimab. But the specific question, I guess, is Where is your team looking in terms of some of the new agents that the clinical community is becoming more interested in such as Iberdomide? And how do you think That can move into a commercial setting as an offset to some of the headwinds you may face in the space. Thank you. Thank you then. Samit? Yes. Thank you. So you very You asked about multiple myeloma strategy. We are leaders in multiple myeloma, of course, continuing to build on the heritage of the image where we pioneered in that space. We do have the broadest portfolio and now we are beginning to see the results of that with the approval of Abekma. But the way we look at it is a 3 pronged approach. On one side, we have the cell mods, which have the potential to allow For us to replace the image over time with a near term opportunity for iberdomide reading out this year in the 4th line plus setting And then the second cell MOD-four eighty reading out in 2022. The second strategy is the BCMA targeting. Abekma already approved And we have the investigation ongoing for T cell engager as well as the ADC targeting. The 3rd pillar is of course the combination. And you will see beginning this year already the studies of CellMODs in the earlier line setting in the 1 to 2 prior lines of therapy. And then we will continue to build on the other combinations as well. So we feel overall really good about our position by having these multiple modalities And we are confident that we can continue to build on our leadership position going forward in that space. Thanks. So can we go for the last one please, Keith? Our last question comes from Navin Jacob of UBS. Please go ahead. Hi. Thanks so much for taking my Just 2, if I may. Just I want to confirm that the on Aliquis, the $160,000,000 true up was actually Was indeed a tailwind and not a headwind. And then finally, Just on BD, a question for Giovanni, if I can. I noticed you have somewhat new vertical For BMS and so far is having neuroscience. As you think about BD, what are the areas that You'll be looking to invest in and roughly how much are you looking to deploy on an annual basis for the next few years. Yes. Thanks, Nevan. So let me just say very quickly, yes, you are right. It is a tailwind, the $160,000,000 With respect to business development, actually what we are doing or our Teams are doing in neuroscience is really interesting. We've obviously, over the last few years, Built a very innovative model where through a network of partnerships primarily, a small team at BMS has been very successful In advancing an early portfolio, it looks quite compelling at this point. So not a large area focus from a sort of late stage development for us yet, but an emerging franchise that could be Important in the future. As I said earlier, we are going to be looking at continuing to strengthen our portfolio depending on obviously the assets That we look at and are available across all of the areas where we have expertise, we haven't really given a Target in terms of spend per year, but we've made it very clear that this is the number one priority in terms of capital Allocation strategy, the acquisition of Mayo Cardia last year is a really good example of the type of focus we want to continue to have going forward as a company. And I'll remind you, we have tremendous financial flexibility to be able to invest in the right opportunities and in the right sciences. So with that, I would like to thank all of you Thank you for joining us today. As we discussed, this quarter, we delivered strong results consistent with our strategy. We've continued to grow revenue, execute on our launches and advance the pipeline. I'm really proud of what our teams have accomplished so far this year, including so many of the important milestones that have been discussed during the call. And as always, our team will be able to answer further questions you may have during the course