Earnings Call: Q3 2013

Oct 29, 2013

Summary

Q3 revenue declined 2% reported while adjusted EPS rose 16%, supported by lower expenses and new-product growth. Guidance narrowed, with LOEs, alliance wind-downs and emerging-market volatility tempering the outlook.

Good day everyone, and welcome to Pfizer's third quarter 2013 earnings conference call. Today's call is being recorded. At this time, I would like to turn the call over to Mr. Chuck Triano, Senior Vice President of Investor Relations. Please go ahead, sir. Thank you, operator. Good morning, and thank you for joining us today to review Pfizer's third quarter 2013 performance. I am joined today by our Chairman and CEO, Ian Read; Frank D'Amelio, our CFO; Mikael Dolsten, President of Worldwide Research and Development; Geno Germano, President and General Manager of Specialty Care and Oncology; Amy Schulman, General Counsel and business unit lead for our consumer business; and John Young, President and General Manager of Primary Care. The slides that will be presented on this call can be viewed on our homepage, pfizer.com, by clicking on the link for Pfizer Quarterly Corporate Performance Third Quarter 2013, located in the investor presentation section at the lower right-hand corner of this page. Before we start, I would like to remind you that our discussions during this conference call will include forward-looking statements, and that actual results could differ materially from those projected in the forward-looking statements. The factors that could cause actual results to differ are discussed in Pfizer's 2012 annual report on Form 10-K, and in our reports on Forms 10-Q and 8-K. The discussions during this call will also include certain financial measures that were not prepared in accordance with generally accepted accounting principles. Reconciliation of those non-GAAP financial measures to the most directly comparable GAAP financial measures can be found in Pfizer's current report on Form 8-K, dated today, October 29, 2013. With that, I will now turn the call over to Ian Read. Ian? Thank you, Chuck. I will begin with some comments on the quarter. Overall, we delivered good operational performance, generated solid financial results, and continued to see steady progress with many of our in-line products and pipeline assets. Operationally, revenues for the oncology business grew 26% due to the continued strong performance of new products, primarily Inlyta and Xalkori. We also had another strong quarter operationally from Lyrica, which grew 11%, and from Celebrex, which grew 13%. Despite macroeconomic and other factors, the emerging markets business grew 5% operationally, primarily due to volume growth for key products in the primary care area such as Lipitor, Norvasc, Lyrica, and Celebrex, especially in China. We still anticipate achieving mid-single digit growth in emerging markets for the year. Turning to an update on our recently launched and approved products and pipeline assets. Earlier this month, we received FDA approval of Duavee, our novel combination therapy for the treatment of moderate to severe vasomotor symptoms associated with menopause and the prevention of postmenopausal osteoporosis, and we anticipate launching this product in the U.S. during the first quarter of next year. We and our partner, Bristol Myers Squibb, continue to focus on improving the performance and physician uptake for Eliquis. In the U.S., we have seen positive momentum in the week-over-week growth in total prescriptions. In late September, we launched our direct-to-consumer television advertising campaign. Eliquis also has been launched for stroke prevention and atrial fibrillation in several additional markets, including Australia, Spain, and Canada, where reimbursement has been established. We also see potential expansion opportunities for Eliquis with additional indications. With Bristol Myers, we submitted an sNDA in the U.S. for VTE prevention in patients undergoing orthopedic surgery. Turning to Xeljanz. We are pleased with the progress of the launch in the U.S. and various other markets, which continues to be in line with our expectations, particularly in the context of being part of a large but slow growth segment within the anti-TNF market. We are seeing a steady increase in prescriptions. Comparing the third quarter with the second quarter of this year, we saw a 53% sequential growth in total prescription volume in the U.S. Overall, the physician's feedback on Xeljanz has been very positive. Satisfaction amongst users is high. In fact, nearly 3,000 healthcare providers have prescribed Xeljanz, and over 75% have been repeat prescribers. We know that before prescribing, rheumatologists want to have a deep knowledge and confidence in Xeljanz's safety profile and clinical experience, particularly given it is a first-in-class product. To date, the vast majority of physicians have reacted favorably to Xeljanz's clinical profile, and we are focusing our efforts on continuing to educate physicians on Xeljanz's clinical data. We also have several phase III programs underway for Xeljanz. The phase III program in psoriasis is progressing and is one of the largest global clinical trial programs in moderate to severe chronic plaque psoriasis to date. There are five studies in the program. Earlier this month, we announced the top-line results from the first two studies, which provided information consistent with our expectations based on the phase II data in psoriasis. The other three studies in the phase III psoriasis program include two pivotal studies and a long-term extension study. We anticipate top-line results for the pivotal trials in the second quarter of 2014, and we will issue a top-line data release after we have received and reviewed the results. We have initiated a phase III program to evaluate Xeljanz the treatment of patients with active psoriatic arthritis, which includes two pivotal trials that evaluate the safety and efficacy of Xeljanz and one long-term extension study. The first data from these trials is anticipated in 2015. We continue to study Xeljanz for other important inflammatory diseases, with several phase II and phase III programs ongoing. This includes a phase III program in ulcerative colitis and a phase II program in Crohn's disease, ankylosing spondylitis, and a topical formulation for psoriasis. We are also moving forward with a once-a-day modified release program for Xeljanz and RA. The FDA recently agreed that a phase III study is not necessary for the once-a-day dose, and we plan to file a new drug application with the FDA in 2015. Beyond the Xeljanz and Eliquis phase III programs, we have or will be initiating several phase III studies, and will be reporting on clinical trial data results from our primary care vaccines and oncology portfolios. I continue to be pleased with the steps we've taken and the progress we are making towards improving our R&D performance. Looking at the primary care pipeline, there are several promising candidates. This month, we're initiating a phase III program for bococizumab, the proposed generic name for RN-316, our PCSK9 monoclonal antibody to lower LDL cholesterol. This is a global program that includes multiple lipid-lowering studies as well as two cardiovascular outcome studies in more than 22,000 patients. Compared to the PCSK9 inhibitor phase III cardiovascular outcome trials being conducted by our competitors, only our bococizumab phase III program includes a dedicated cardiovascular outcome study in patients who cannot achieve LDL levels lower than 100 mg per DL despite the use of statins. This is a very high-risk patient population with significant unmet need who represent a tremendous cost to our healthcare system. Our second phase III outcomes trial will address whether driving LDL cholesterol levels well below current guideline recommended targets will lead to a further reduction in cardiovascular events. Importantly, compared to other programs, our phase III program includes the broadest range of high-risk patients in need of improved cholesterol management. We are currently completing the final analysis of the data sets of our completed phase II-B study and plan to submit the results for presentation at the American College of Cardiology meeting in March 2014. We are planning to continue development of tanezumab for the treatment of osteoarthritis, chronic low back pain, and cancer pain. We have just entered into a collaboration agreement with Eli Lilly and Company to jointly develop and globally commercialize tanezumab, which provides that, in addition to certain potential milestone payments to Pfizer and Lilly will equally share product development expenses and potential revenues and certain product-related costs. The tanezumab program is currently subject to a partial clinical hold by the FDA, pending submission of non-clinical data to the FDA, which we anticipate submitting in the first half of 2014. In addition, we are initiating a phase III program with our partner, Merck, for ertugliflozin, our SGLT2 inhibitor for the treatment of type 2 diabetes. Turning to vaccines, we expect to have data readouts in three disease areas, pneumococcal pneumonia in adults, Mening B, and Staph aureus. For pneumococcal pneumonia, the case accrual in the CAPiTA trial involving Prevnar 13 adult has been completed. The processing of the cases will take several months to complete, and we have not yet seen the data. We expect a readout of the top-line results early in 2014. For Mening B, we anticipate sharing results of the phase II study data in adolescents and young adults who are the major carriers of this disease at a key medical congress in the first half of 2014. Of note, our vaccine contains two protein components which elicit a broad immune response against the majority of Mening B vaccine strains in these immunized individuals. We are encouraged by the efficacy and tolerability data we have seen to date and have already initiated a pivotal phase III clinical development program that includes phase II and phase III trials that will include more than 20,000 participants. If trial enrollment and recruiting goes as planned, data from this program are expected in the next several years. Excuse me. For *Staph aureus*, we recently concluded a phase II-A study which showed encouraging signals that our vaccine elicits positive immune response. The next step is to move into a phase II-B study in surgical patients. We anticipate sharing results from the phase II-A study in the first half of 2014 at a key medical congress. In oncology, we also anticipate several readouts in 2014. In breast cancer, we expect the final efficacy and safety data from the phase II palbociclib study to read out in early 2014 to be presented at ASCO in June 2014 or at another congress next year. We have initiated two phase III studies of palbociclib. One study mimics the trial design of the phase II study in patients with post-menopausal ER-positive, HER2 negative advanced breast cancer, which has a planned enrollment of 450 patients. The other study is in patients with hormone receptor-positive, HR-positive, and HER2 negative advanced recurrent breast cancer. It compares fulvestrant plus palbociclib to fulvestrant plus placebo. In addition, we expect to start a phase III study for palbociclib in the next few months in early breast cancer for high-risk patients with neoadjuvant treatment. For non-small cell lung cancer, we're expecting top-line results from two phase III studies for dacomitinib in the early part of next year. We have five programs in various stages to develop biosimilars of innovative products. Our development program includes biosimilars for Herceptin, which is scheduled to start phase III within the next few months. In addition, we have a biosimilar development program for Rituxan and Remicade and Humira that are scheduled for phase III starts next year. Our biosimilar for Avastin will begin phase I next year. The ongoing R&D investment level to support our late-stage pipeline opportunities is warranted by the significant revenue potential associated with these programs. We expect that as these programs further progress, some incremental R&D investment will be necessary. That said, we will balance this need with overall shareholder return, and we will continue to be opportunistic regarding additional internal and externally sourced compounds that can further enhance our research pipeline. I'll close with a few words about the new commercial structure we announced last quarter. We have been aligning talent, asset, and individual reporting systems to support our new operating structure. We remain on track for commencing operations in the new structure at the start of 2014 and for providing a 2014 baseline management view of profit and loss for each business, starting with our financial results for the first quarter of 2014. In summary, I believe we are making steady progress across the business by enhancing the quality of the pipeline, demonstrating fiscal discipline on how we deploy our capital, and executing on our business plans in order to drive greater value for our shareholders. Now I'll turn it over to Frank to take you through the details of the quarter. Thanks, Ian. Good day, everyone. I want to remind everybody that as a result of the full disposition of Zoetis on June 24th of this year, the financial results of the animal health business are reported as a discontinued operation in condensed consolidated statements of income for year-to-date 2013 and third quarter and year-to-date 2012. As always, the charts I'm reviewing today are included in our webcast. Now let's move on to the financials. Third quarter 2013 reported revenues of approximately $12.6 billion, decreased 2% year-over-year, reflecting a 2% negative impact from foreign exchange. Excluding the impact of foreign exchange, revenues decreased operationally by $38 million or less than 1%, primarily due to the negative impact of the continued erosion of branded Lipitor in the U.S., developed Europe, and certain other markets, the ongoing expiration of the Spiriva collaboration in certain countries, a decrease in government purchases of Prevnar and Enbrel in certain emerging markets, and the loss of exclusivity of certain other products, including Lyrica in Canada February 2013 and Viagra in most major markets in Europe in June of 2013. These were partially offset by the growth of certain in-line products, including Lyrica, Enbrel, Inlyta, and Xalkori globally and Celebrex and Xeljanz in the U.S. I want to point out that reported revenues also included $67 million from transitional manufacturing and supply agreements with Zoetis, which are expected to continue for approximately two years. Adjusted diluted EPS of $0.58 increased 16%, primarily due to the aggregate decrease in adjusted cost of sales, adjusted SI&A, and adjusted R&D expenses of $341 million or 5% due to the benefit of our ongoing cost reduction and productivity initiatives, the nonrecurrence of the $250 million payment in the year-ago quarter for the acquisition of the exclusive over-the-counter rights to Nexium, which was included in R&D expenses, as well as the favorable impact of foreign exchange on these items of $166 million or 2%. These were partially offset by higher SI&A spending to support new product launches. In addition, there were fewer diluted weighted average shares outstanding due to our ongoing share repurchase program and the first full quarter impact of the Zoetis exchange offer, which also favorably impacted adjusted diluted EPS. Reported diluted EPS was $0.39 versus $0.43 in the year-ago quarter and favorably impacted primarily by lower legal charges, lower acquisition-related and other costs, and fewer shares outstanding, which were more than offset by the loss of exclusivity of certain products, lower income from discontinued operations, and a higher effective tax rate. During the third quarter, biopharmaceutical revenues in the BRIC-MT markets increased 2% operationally, driven primarily by strong volume growth in China, especially for Lipitor. In these BRIC-MT markets, volume growth of 3% was partially offset by price reductions of 1%. Revenue from all emerging markets increased 5% operationally in the third quarter. If you exclude the portfolio of products whose rights were transferred to our joint venture in China with Hisun in the third quarter, we would have had operational revenue growth compared to the third quarter of 2012 of 6% in our emerging markets business, 4% in the BRIC-MT markets, and 16% in China. Foreign exchange negatively impacted third-quarter adjusted revenues by 2%, or $271 million, and had a positive impact of 2%, or $166 million on the aggregate of adjusted cost of sales, adjusted SI&A expenses, and adjusted R&D expenses. As a result, foreign exchange negatively impacted third-quarter adjusted diluted EPS by approximately one cent compared to the year-ago quarter. Now moving on to our 2013 financial guidance. Based on our year-to-date performance and outlook for the remainder of the year, we are narrowing the ranges for certain components of our full-year 2013 financial guidance. We are narrowing the reported revenue range to $50.8 billion-$51.8 billion from $50.8 billion-$52.8 billion. I want to remind everyone that beginning on November 1, 2013, we enter into the 36-month sunset period in the collaboration agreement with Amgen for Enbrel in the U.S. and Canada. During this period, we expect that our share of the Enbrel collaboration, which is high margin because there is no associated cost of goods sold, will decline significantly. In addition, going forward, the recognition of profits from the Enbrel collaboration will shift from alliance revenue to other income as we move to a royalty structure. Furthermore, these royalty payments will be much less than our current level of Enbrel profits. Outside of the U.S. and Canada, however, our exclusive rights to Enbrel will continue in perpetuity. I also want to point out that our Spiriva collaboration, which is also recorded in alliance revenue, will continue to wind down during the fourth quarter 2013 and 2014, most notably in the U.S. and Canada. Currently, the majority of alliance revenue is composed of Enbrel in the U.S. and Canada, as well as Spiriva. Moving on to adjusted cost of goods sold as a percentage of revenues. We are narrowing this range to 18%-18.5%. We are narrowing our adjusted SI&A expense range to $14.2 billion-$14.7 billion while continuing to absorb launch cost and support of new products. We are narrowing our R&D guidance range to $6.3 billion-$6.6 billion, which will support our high-potential late-stage pipeline opportunities. We now expect other deductions to be approximately $400 million and continue to expect the effective tax rate on adjusted income to be approximately 28%. We are narrowing and lowering the reported diluted EPS range to $3.05-$3.15, and we are narrowing our adjusted diluted EPS range to $2.15-$2.20 from $2.10-$2.20. Now moving on to key takeaways. Third-quarter results continue to reflect the loss of exclusivity of certain products in various geographies, as well as the ongoing volatility in emerging markets. We continue to expect full-year operational revenue growth in our emerging markets business to be in the mid-single-digit percentage range. In addition, we continue to mitigate the earnings impact of product LOEs with both expense discipline and share repurchases. We narrow the ranges for certain components of our adjusted financial guidance. Our recently launched products are progressing at a measured and steady pace. We are advancing initiatives internally so that we will implement our new commercial structure at the start of 2014. We remain excited about our high-potential late-stage pipeline assets and expect to allocate R&D investments to support their advancement beginning in the fourth quarter of 2013 or early 2014. Finally, we continue to create shareholder value through the prudent allocation of our capital. To date, in 2013, we have repurchased approximately $13.1 billion, or approximately 462.1 million shares. We continue to expect to repurchase in the mid-teens of billions of dollars of our common stock this year. As a result, we expect to return more than $20 billion to our shareholders this year between buybacks and dividends. In addition, we expect the first quarter 2014 dividend level to be set by our board of directors during our December board meeting. Finally, we remain committed to delivering attractive shareholder returns in 2013 and beyond. Now I'll turn it back to Chuck. Thank you, Frank. Operator, please, if we could now poll for questions. Thank you, ladies and gentlemen. To ask a question, please press star, then the number 1 on your telephone keypad. Your first question comes from Gregg Gilbert from Bank of America. Thanks a lot. To the extent that there are a couple other PCSK9s out there, can you talk about what you needed to see in phase II to make this large investment and potentially how your product is differentiated beyond the clinical trial differences you highlighted? Secondly, Ian, curious how you think the collaboration in Japan is going with Mylan and whether you think that could be a good model in other places or more broadly. Thanks. Thank you, Gregg. Well, clearly, we've seen in the phase II data sufficient quality of data to encourage us to enter into phase III and believe we have a highly competitive product. I'd ask John Young to give more details on that and also discuss the Mylan collaboration. Okay. Thanks, Gregg. Let me take PCSK9, our focus is on first of all, and to say, first of all, we think we actually have a great antibody, which came out of our Rinat labs in San Francisco. I think in addition to having excellent substrate to take into clinical development, we also believe that we've been able to put together a differentiator or potentially differentiated clinical program. Our program will be the only program investigating both high-risk primary and secondary prevention populations. When we begin to look at the program in more detail, it includes a dedicated CV outcome study in patients who can't achieve LDL levels lower than 100 milligrams per deciliter, despite the use of statins. That's a very high-risk patient population with a lot of unmet clinical need. And those patients, as you heard from me, really do represent a tremendous cost to the healthcare system. A positive outcome in that population, we believe, will be very significant. Now we also combine in our program a second phase III outcomes trial that will address whether driving LDL levels to well below current guideline recommended targets will lead to further reduction in cardiovascular events. I think lastly, the point to make is that importantly, compared to other programs, our phase III program includes the broadest range of high-risk patients in need of improved cholesterol management. As I said, uniquely includes both high-risk primary and secondary prevention patients. Overall, we believe that the combination of good basic substrate in the antibody, combined with a clinical program that we believe has the potential to demonstrate real differentiation across patient populations with significant unmet need will enable us to bring a very competitive profile into what is clearly a potentially very attractive and promising marketplace. In terms of Mylan, we continue to make positive progress with Mylan in Japan. The collaboration's on track. Currently, we're selling around about 250 products from the combined company's generic portfolios. The transition integration of all 200 Mylan secondees to Pfizer organization has been completed. We've completed the launch of the collaboration's first generic pipeline products in June based on initial performance. All nine products are forecasted to meet or exceed our full-year plans. I think let me just finish on Mylan and say that we're extremely pleased with the progress that we've made, and we're going to look to maintain that momentum into 2014. Thank you, John. I'd add that we're also very comfortable and pleased with the quality of partnership with Mylan. Great. Thank you. Next question please, operator. Your next question comes from Jami Rubin from Goldman Sachs. Thank you. This is either for Ian or John. I am just wondering if you could talk about how you plan to monetize the value business. Just how do you see this business growing? What are the opportunities on the table that will help to unlock value, and are one of those opportunities to sell the business? If so, is there a time limit? Do you have to wait a certain amount of time? I know that you have talked about the other businesses, if you were to spin them out, you would have to wait three years. Is there a similar limit if you were going to sell this business? Would you sell part of it? Also, if you were to sell it, would you be willing to accept someone else's stock in exchange for it? Then just a follow-up question on PCSK9. Your competitors are not planning on getting, I do not believe they need outcomes trials to gain FDA approval. Do you feel that you need these outcomes trials for approval, or is this just to broaden your label and for further differentiation? Thanks. Well, Jami, thank you for those questions. On PCSK9, I will ask John to comment on that first, but I think the issue is in this marketplace, our trials are constructed so as to be able to demonstrate value to society and payers. John, do you want to add anything more to that? Yeah. I think in terms of the program, as I have already said, we believe we have put together a really robust and potentially differentiated program. Clearly, we know that LDL-C is a very well-established surrogate for cardiovascular risk. Certainly, we know from dialogue and discussion we have had with the FDA that it is conceivable that regulators may require demonstration of a beneficial effect on CV events before approving a new class of agents such as PCSK9 inhibitors. At a minimum, robust LDL-C lowering, along with a comprehensive long-term safety database, will likely be required for initial approval of bococizumab and potentially of other medicines in the class as well. The bococizumab phase III program is designed to address the potential for regulatory authorities to require, in addition to LDL-C lowering, a robust long-term clinical safety database and cardiovascular outcomes data for approval. Mikael, do you want to add anything vis-a-vis the development of PCSK9 from the technical point of view? Yeah. We have put in a lot of technical capabilities, how to develop antibodies with the most potent and biopharmaceutically appropriate characteristics. When you look at the class, I think you can see emerging data suggesting some of the antibodies being very potent and some being intermediate. As Ian alluded to, we were very encouraged by the potent effect of our antibody in phase II and its really robust LDL-C lowering tolerability and low frequency of anti-drug antibody. Thank you. Jamie, on your questions on the value or we call it established products business unit. Right now, we're focused on setting up the new organizational model where we have two innovative businesses and one established business. We're doing that because we firmly believe those businesses have different characteristics, and we want management uniquely focused on maximizing the growth opportunities for those businesses. John, who is running that part of the business, will clearly be looking at how to maximize the growth in the emerging markets, how to maximize our supply chain advantages in the developed markets, what growth opportunities there are in sterile injectables, either organically or inorganically. Are there other BD activities that can be undertaken in that business such as 505(b)(2) filings? Frankly, it's simply too early to speculate on the future developments of those business. Right now, as an organization, we're focused on getting them up and running, the management up and running, in place, looking at all of the different growth opportunities I just discussed, looking at supply chain. Once those businesses are up and running, and once there's transparency, then we'll see how the market evaluates the sum of the parts of those businesses. Great. Thank you, Ian. Operator, please. Next question. Your next question comes from Chris Schott from JPMorgan. Great. Thanks very much. Just following up on that. Ian, how long do you think are you going to want to see these three business units running separately before you will be comfortable and in a position to evaluate and make that decision on the next steps for Pfizer with regards to the strategic alternatives to your portfolio of businesses? Is that something that is going to take a year? Is it something longer? I guess I am kind of thinking as next year is about setting them up, as we get to 2015, is that a timeframe where it is reasonable to think about a decision on some of these? The second question I had, and similarly following up on Jami's question, if you were to decide that the value core was something that made sense to separate from Pfizer, are there structures that would allow you to do that prior to 2017 if that is the right decision? Or is that something that is unreasonable to think about from a timing perspective? Just trying to get some clarity on the timing if in fact you went that direction with the business. Thanks very much. Thank you, Chris. I do not have a fixed timeline in my mind. Right now we are really focused on the operational aspect and the value of these businesses will come from their exquisite execution and management, making them valuable by focusing on growth. As that occurs, we will evaluate our options in a timely manner. I will ask Frank to comment on the actual mechanics of any type of transaction with you. Sure. Chris, the way to think about this is, I will call it public transactions versus private transactions. In a public transaction, three years of audited financials are required. So think about three years prospectively of audited financials. In a private transaction, a sale of a partial business, of an entire business, of some sort of a joint venture, anything like that. It depends on a significance test, and there is three elements to the significance test. There is an asset test, an income test, and an investment test. What really drives the requirement there for audited financials is based on the size of the acquirer and then the income, the assets, and the investment of what is being acquired compared to the acquirers' income, investments, and assets. That can range anywhere from zero in terms of audited financials to up to three years. That is really what will drive the audited financial requirements. But once again, to punctuate what Ian said, what we are all about doing is getting these businesses to operationally hum and execute with excellence. Great. Thank you, Frank. Thanks, Frank. Next question, please. Your next question comes from Tim Anderson from Sanford Bernstein. Thank you. Two questions, please. If I could just go back to the split-up. Can you better characterize the possibility that Pfizer does not split itself up in the complete sense of the word? You previously alluded to the idea that if the market appropriately revalues Pfizer once they better appreciate the financials for those different divisions, that perhaps a full split-up would not be necessary. My question is it reasonably possible that you don't fully split up? On palbociclib, when might we start to see data in non-breast cancers? It seems like you should either have data in hand already or you should very closely have it in hand on tumor types in the blood cancer area, in colorectal, and in lung. Can you say so far that you haven't had any failures in any of these other tumor types? Thank you, Tim. This issue of split is totally dictated by what our view will be on how to maximize shareholder value at the appropriate time. When these businesses are operating, when there is transparency for analysts, when they've had time to establish a track record, then we will look at that, and we will make decisions based on how best to maximize the value to shareholders irrespective of size or composition or structure of residual companies because this management team is focused on producing shareholder value. That's how we'll take the decision, and I don't really think I can add anything more than that other than to say that our guiding star is how to create shareholder value. Geno, would you like to talk about palbo? Sure. Tim, let me just comment that our highest priority is to efficiently advance our breast cancer program right now with palbociclib. As Ian mentioned, we have initiated two of the phase III trials. We will initiate another phase III trial in breast cancer this year. Frankly, we are looking at other breast cancer populations to explore further as well. We are firmly in the lead here, and we are really excited by the data, and this is our highest priority. Notwithstanding that statement, we are exploring the use of palbociclib in a number of other tumor types, as you said, including melanoma and lung cancer, et cetera. These are primarily phase I level studies, and we are not reporting any data at this point. Thank you, Geno. Thanks, Geno. Next question, please. Your next question comes from Mark Schoenebaum from ISI Group. Hey, thank you very much for taking my question. If I could turn back to the PCSK9s, if I may. Might you help us out with a timeline for the completion of the outcomes trials and let us know if there are opportunities in those trials for early stoppage based on interim results? Could you also tell us what the dosing is that's being used in the trial? Is it once a month, twice a month, et cetera? On CAPiTA, if I might, could you just walk us through the steps that need to occur after you see the CAPiTA data to ensure that sales pick up? I know you have to wait for certain recommendations, certain bodies. I wonder if you could just walk us through that. Is there a scenario where that trial misses statistical significance on its primary endpoint, Mikael, but the trends are robust enough that you could still see a recommendation come out of the relevant bodies, or do you really think you need to show statistical significance? Sorry for my long-winded question. Thank you. John, if you could talk a little bit about PCSK9 again. Okay. bococizumab, and then we'll hand it over to, I think, Geno for the commentary on the CAPiTA. Okay. Okay. Thanks, Mark. Obviously it is fair to say that all of the PCSK9 programs are in relatively early stages of their clinical development. As I mentioned in answer to an earlier question, one of the things that all of the programs, including ours, will have to be determined is the datasets as they emerge and what will be required for approval. That is something that we will continue to have dialogue with the agency about. I think it is really premature to determine if there is any interim readout of data that would lead to an earlier approval, either of a lipid-lowering indication or of the outcome indication. Mark, can you remind me of the second part of your question? Dosing. In terms of dosing. Okay. The dosing schedule that we are taking into our clinical program is a twice-a-month dosing schedule. As you heard already from Mikael, we will be presenting the results of our phase II-B study early next year. From the analysis that we have done of that data so far, although it is incomplete at this point, certainly we believe that twice-a-month dosing schedule actually provides really the optimal consistent cholesterol lowering right across the dosage interval in order to maintain the optimal clinical effect and ideally the optimal clinical outcomes. We feel really positive about the twice-a-month dosing schedule being the optimal dosing schedule for bococizumab. That being said, Mikael, do you want to add on something about some technology that we are excited about there? Yeah. Just to build on the excellent way in which John described our PCSK9 clinical strategy. It is a really well-behaving antibody and the twice-monthly administration schedule is the logical next step as John described. However, we think that as part of a potential life cycle management strategy, there are opportunities to also explore once-monthly schedule. That may include the use of technologies such as the Halozyme technology, for which we have exclusive license within the PCSK9 class, and we are now performing early tests on the suitability of that technology to extend half-life and also lower the volume that you need to inject. The antibody itself at a high dose has the potential for once a month, but we would rather see a technology like this to give a really convenient opportunity. As you can see, as we go forward with twice monthly, we have a life cycle management potential to offer additional regimens. Thank you, Mikael. And Geno, CAPiTA? Sure. With regard to the steps for CAPiTA, as we've indicated, we've completed accumulation of the required number of events. We're in the process now of finalizing the analysis of those events and completing the data management associated with creating our top-line results. We are at the same time in discussions with the CDC and members of the ACIP and the Pneumococcal Working Group to ensure their understanding of the protocol and the potential outcomes so that when we have the data, they can move on the data rapidly. We're in ongoing discussions with them, and this is obviously in the United States. When the data's available, the working group will be exposed to the data and will do their grading process and prepare for bringing those data and their assessment to the formal ACIP committee. The ACIP committee meets three times a year in February, in June, and in October. It's unlikely that we'll have data available for the February meeting. But we are targeting the June meeting. It could occur in June or it could occur in October. That's the U.S. situation. Ex-U.S., in most cases we don't have the pneumonia indication in most ex-U.S. markets. Therefore, the CAPiTA trial results will form the basis for the pneumonia indication, and we will file those applications, and depending upon the review times, we would expect to see the pneumonia indication appear in the 12 to 14 month timeframe beyond those filings. Hopefully, that gives you some sense of the steps and the timing associated with CAPiTA. With regard to the outcomes, there are multiple endpoints, including vaccine type, non-bacteremic pneumonia, vaccine type all-cause pneumonia, or vaccine-type pneumonia, and invasive pneumococcal disease. There are a number of different scenarios that could play out depending upon the outcomes. Obviously, we're targeting the most favorable outcome, which would be demonstration of positive effect on prevention of vaccine type non-bacteremic pneumonia. Thanks, Geno. Moving on to the next question, please. Your next question comes from Marc Goodman from UBS. Yes, a couple things. First, can you help us quantify the impact of these government purchases, Prevnar and Enbrel, and the lumpiness there, and how that's going to impact the next quarter? Second, in China, it looks like the growth continues very strongly there. Why are you not having the problems that some of the other players are having there? Can you just talk about the dynamics? Or maybe it is impacting you, and the growth would have been even better. Then Geno, maybe you can just talk about some of the dynamics of the new oncology drugs that have launched and what's happening there, and how those ramps are going. Thanks. Thank you, Mark. If I understood the question, you would like to understand some of the seasonality or lumpiness in government purchases of Enbrel and Prevnar. Perhaps if John can talk about that in the emerging markets and then deal with China, and then Geno, if you will talk to Prevnar in the- The oncology product. And the oncology product. Inlyta and Xalkori. Thank you. All right. Thanks, Mark. Clearly, there is some volatility. I think you've heard that the emerging markets, while they clearly represent overall significant continued opportunities for growth, we do see quarter-on-quarter volatility, as you know. Particularly, that is the case in the area of government tenders. Without going into all of the details, to give you a sense of some of the moving pieces. With Prevnar NIP shipments in Turkey this year, for example, we certainly have seen a fall in sales in Turkey this year. We had NIP sales last year. We haven't seen those year-to-date. In Brazil, we've seen decreased institutional purchases for Enbrel and also for Prevnar in the AfME or Africa Middle East region. Enbrel Brazil shows around a 2% decline this quarter and a 12% decline year-to-date, just to give you a sense of the rhythm of the business in Brazil. I think overall, obviously the emerging markets represent a tapestry of markets around the world. I think the high level message is, as we have always seen, we'll see some quarter-on-quarter volatility, particularly in the area of institutional purchases. Overall performance, the underlying performance of the business in the emerging markets for both Enbrel and Prevnar 13 remains very positive. We have seen in those markets, and calling out Brazil and Turkey particularly, some volatility over the third quarter. In China, we continue to operate as we've always operated. Globally, we operate with a heightened sense and a strict sense of our compliance obligations. I don't believe our business in China is being particularly affected by anything other than just the macroeconomic situations that are occurring across the emerging markets. The growth rate has slowed up somewhat in China compared to the previous year but continues to be robust, and we continue to expect our Chinese business to perform well. Yeah. Just, Mark, a couple of comments on Inlyta and Xalkori, which we're really pleased with the progress that's being made there. For the quarter for Inlyta, we did $83 million, which is about 200% above what we did last year, same quarter, and a double-digit increase over our prior quarter. About half of that's in the U.S., where we grew by about 50% relative to last year. So we're seeing nice, continued, fairly robust uptake of Inlyta. Physicians are really pleased with this product. Patients are responding well. We have about a 30% share of second line in the U.S. and about a 35% share of second line in Japan. So, we're doing well. We think, in many cases, the future growth has come from expansion of use beyond academic medical centers and with oncologists who are very familiar with the drug. And we think there's good opportunity for further growth there. Xalkori also is becoming a great product. $73 million for the quarter, up about 25% from last year and about 10% from the previous quarter. The trick there, it's the same story. We need to get the diagnostic in full use. We're at about 66% in the U.S. and a little bit less in Europe and Japan. So we'll continue to work on that and continue to identify the appropriate patients and grow that business. Thanks, Geno. Next question, please. Your next question comes from Seamus Fernandez from Leerink Swann. Seamus, we can't hear you. Sorry, can you hear me? Yes, we can hear you fine. Oh, okay, great. Just first off, on potential moves as between now and 2017, how should we be thinking about the prospects? I know that there is a group at Pfizer that's, I believe, constantly looking at opportunities to do incremental separations. Do you see that as a possibility? Is that something that Pfizer is consistently looking at between now and 2016? Do you see opportunities for value creation there? I guess that's more a question for Ian Read. Then separately on tanezumab, can you just update us again on where we stand with the anti-NGFs scientifically, the move forward in osteoarthritis, chronic low back pain, and cancer pain? Again, how we should think about the potential changes in the development path as you partner with Eli Lilly and Company. Thanks. Thank you, Seamus. We've set up the organizational construct because we believe it is the best way to focus and maximize the different parts of our business, as each segment represents, in my opinion, different models. It also gives us a lot of optionality going forward as we look at ways of creating shareholder value. Going back to your question, we're always looking at ways of maximizing shareholder value, and I think this construct gives us the maximum optionality and ability to look at different ways of creating that value. We'll take those decisions at the appropriate time as the opportunities mature. With that, I'll ask John to talk about tanezumab. Okay, thanks, Seamus. Just to give you an update, I think as you know, in December 2012, the FDA placed a partial clinical hold on the development of NGF inhibitors, including tanezumab. That partial clinical hold was unrelated to the prior hold that related to bone and joint-related safety. The latest clinical hold was based on peripheral nervous system effects observed in animal studies conducted with NGF inhibitors by other manufacturers. In April this year, we reached an agreement with the FDA on the path for removal of that partial clinical hold. To answer the questions which led to the partial clinical hold, dosing was initiated to demonstrate sympathetic nervous system safety in the requisite non-clinical study in July of this year, and that study is progressing on schedule. We intend to submit the results from that study in the first half of 2014. Assuming a positive review of the non-clinical data by the FDA and removal of a clinical hold, we're preparing to resume the phase III studies for tanezumab early in 2014. We're very excited about the deal that we announced today with Eli Lilly, and we believe that represents a very positive opportunity for us to collaborate to take tanezumab into phase III clinical development, and ultimately, we believe, into the marketplace, which clearly has significant need and opportunity for new pain treatment options. We're very excited about the potential for tanezumab, assuming that we are able to deliver positive data from those non-clinical studies. Hope that helps, Seamus. Thanks, John. Next question, please. Your next question comes from John Boris from SunTrust. Thanks for taking the questions. First question for Frank. When you take a look at the alliance revenue, at least consensus estimates for alliance revenue in 2014, 2015, I think they're around $1.7 billion, $1.8 billion. Are you comfortable with those numbers being where they're at in light of the expiration of the majority of your agreements? Then when you look at the consensus revenue estimate of $50.5 billion for 2014, can you just maybe walk us through some of the pushes, pulls, or influencers on losses of exclusivity that influence that number, and are you comfortable with it? Secondly, on the Mylan Pfizer agreement that you have in Japan, can you help us understand some of the accounting around that and also the level of penetration that you got into the generic market in Japan? A very attractive opportunity there, especially in light of what the Japanese government's trying to push there. Then lastly, just a pipeline question on the SGLT2. Can you help us understand what the points of differentiation are, especially in light of there being three other entrants potentially in that market before you enter, and then any thoughts around a combination strategy that you might have with Januvia? Thanks. Thank you, John. Frank, do you want to- Yeah. address some of the projections we requested? I think the way I'll do this for 2014 in total is maybe some of the headwinds and then some of the tailwinds. In terms of headwinds, no surprises, we continue to have some losses of exclusivity that will affect us in 2014. Enbrel entering the 36-month sunset period is one of them. Spiriva in Japan is another. So there'll be some LOEs that we'll experience that'll impact 2014. We've said previously $3 billion-$4 billion in LOE impacts for the next couple of years. That's clearly what we're expecting for 2014. If you look at some of the tailwinds, we continue to expect growth in emerging markets. Some of our new products, we've had some nice growth in Xalkori and Lyrica, Xeljanz. We expect to see new product growth continue in a steady and measured way, and we've had some nice performance in some of our in-line products. Lyrica this quarter, Celebrex this quarter, 11%, 13% globally. So lots of opportunities there. In terms of addressing headwinds, in addition to the opportunity areas on the top line, we'll continue to manage our cost and expense structure. We'll continue to use our balance sheet and our capital structure to help us manage the LOE and revenue headwinds like we've been doing over the last couple of years. In terms of alliance revenue, let me just run the numbers, and then I'll answer the question. If you look at the alliance revenues this quarter, $700 million, down from $900 million in the year-ago quarter, down 22%. Year-to-date, down 15%, $2.6 billion to $2.2 billion. The majority of the alliance revenues to date are really from Enbrel and Spiriva. And going forward, the alliance revenues are going to come from Rebif, which is in the numbers today, and then obviously Eliquis growing. So that'll be the rhythm of the numbers relative to the alliance revenues. But clearly, on a going-forward basis, the alliance revenues will be declining, and they'll be declining significantly. In terms of Mylan accounting, I think the simple answer is we record the revenues from the products that are coming out of the collaboration. John, do you want to make any comment on the penetration in the market, or is it too early? Yeah, I think it's really too early, John, to talk about penetration and market shares specifically, other than to say that we're on track. We've met all of our milestones in terms of the transfer of Mylan colleagues into the Pfizer organization. We are currently selling around about 250 products from the combined company's generic portfolios in the marketplace. And the project plan is in place to transition all Mylan inventory to Pfizer distribution, which is a real strength of our organization in Japan. Processes and work in place to address any quality supply risks. In terms of manufacturing and development, initiatives have kicked off to build manufacturing capacity for collaboration volumes. And I think the overall message on Mylan is the joint venture is certainly progressing very much according to our plans. In terms of ertugliflozin, we, as you know, entered into a worldwide collaboration, except Japan, with Merck to develop and commercialize ertugliflozin and ertugliflozin containing fixed-dose combinations with metformin and Januvia tablets. It's our innovative proprietary SGLT2 inhibitor for treatment of type 2 diabetes, and we are initiating phase III clinical trials with our partner, Merck. I certainly don't want to comment in detail about competitors in this class other than to say that our two lead competitors have had probably a troubled regulatory pathway in the U.S. and Europe. And we believe that the dialogue that we've been able to have with the FDA, as well as the strength of the molecule, certainly has enabled us to put together a development program combined with the strength of a partnership with Merck that gives us a very good runway into the marketplace. Thank you, John. Mikael, do you want to comment on the technical aspects of our product and differentiation? Yeah. Let me just build on the excellent discussion that John had on ertugliflozin. So it's a highly selective molecule for the SGLT2 transporter. As you will learn when you explore that class, there is difference in the selectivity among the molecules. It's highly potent. It's a very low dose, which is really a key characteristic when you aim to combine with other drugs, such as a market leader, Januvia and metformin. It performed very well in the phase II studies with robust lowering of HbA1c and also favorable effect on blood pressure. So we think really these unique characteristics of a best-in-class molecule, combined with long experience with Januvia, allows for a very favorable long-term opportunity here. Thank you, Mikael. Next question, please. The next question comes from Alex Arfaei from BMO Capital Markets. Good morning, and thank you for taking the questions. Two, if I may. Ian, I wanted to get your latest thoughts about entering the cancer immunotherapy market, perhaps partnering palbociclib in breast cancer with one of the leading PD-1s. It seems like that could be a pretty promising combination. A follow-up, we recently heard some negative comments from your peers about entering the biosimilar market, including commercial risk. I'm just wondering, what is it that's made you confident to proceed with a fairly aggressive biosimilar strategy? Thank you. So on the biosimilar market, each company takes its own view of the commercial opportunities. We feel that we have the technology and the ability to bring biosimilars to the market that will be very well characterized. We believe that in that marketplace, we don't see it reacting like the small molecule generic market. We believe it'll probably act more like the sterile injectable market. We bring to that commercialization the credibility and the quality of Pfizer's manufacturing and research. We think it is a reasonably low-cost development opportunity for products that have a high commercial opportunity. So we think it's a good appropriate allocation of resources for the potential payoff. Geno, would you like to talk about the immunotherapy, and if you want, pass it off to Mikael as well between the two of you? Okay. So Alex, obviously it's a really pretty active, exciting time with all that's happening with the checkpoint modulators and used in monotherapy in various combinations across many different tumor types. We see this as an emerging field with a lot of experimentation going on to identify appropriate patients and appropriate combinations. We're actively exploring a number of mechanisms ourselves internally with our 4-1BB monoclonal antibody and some of the vaccine approaches that we have access to, as well as looking at potential partnerships. Mikael, do you want to add? Yeah, I think Geno described it very well. We have, of course, invested heavily in our seamless construction businesses. As you mentioned, palbociclib is one of the real example of potential breakthrough drugs here. But the ability to combine small molecule, large molecule with cancer immunotherapy is going to have a very interesting potential. We have, as Geno alluded to, a number of internal activities, but are also open for partnership, which in general, we have shown is a great way to grow value in this industry. Thank you. Thanks, Mikael. Moving on to the next question, please. Your next question comes from Tony Butler from Barclays Capital. Thanks very much. Ian, back to biosimilars. You alluded to the notion that there would be some incremental R&D cost. Could you provide some color around that, please? Secondly, if I may, one pipeline question on Mening B. The 20,000 patient study, could you provide some timing for total enrollment and when that might read out? Moreover, Mikael, do you need high titers to both proteins in order to provide appropriate killing of the bacteria? Thanks very much. Tony, I wasn't quite sure of your question on the biosimilars. The incremental R&D expenditure isn't per se because of biosimilars. It's because of what I think I described as a very strong cohort of phase III products coming in development in the near future, and one that we are also appropriate partnering to ensure that we maximize shareholder return. Mikael, do you want to talk about the titer issue and- Yeah. Thank you for your interest in Mening B. We do think it's a very important vaccine. It's the kind of missing component in that area of meningococcal strains to meningococcal B. We have three trials that are well underway, efficacy, safety, and lot consistency trial. We believe that you should aspire to raise relevant titers to both proteins. Together, these two proteins that were carefully selected during our development process, they will cover the great majority of meningococcal strain, which is a unique feature of our vaccine. We noticed in our phase II trial, a robust titers and good tolerability. As you know, we are focusing on adolescent population, which is the main carrier of the disease. Thank you. Tony, just to expand, our biosimilar spend is we have been spending, and it's sort of in our baseline spend of our development programs. I didn't particularly see that as a driver of R&D spend. Geno, just on the timing of enrollment or anything, do we have comments there for Mening B? We are enrolling now, and I think we anticipate completing enrollment in the 2015 timeframe. Yeah. Thank you. Our next question, please. Your next question comes from Andrew Baum from Citi. Morning. A couple of questions, please. First, Ian and Frank, back to portfolio management. Could you give us some guide to the total costs and the phasing of those costs for the operational separation of the established products business, just in helping us understand how optionality pans out? Second, for Mikael, could you give us an update on the phase I anti-4-1BB CD137 trial? It's been running for 2 and a half years in a very refractory patient population. What's the chances we could get data prior to 2015? Thank you. Thank you, Andrew. Frank, if you could sort of take us through the implications of the structuring and the costs and the timing of that, et cetera. Mikael can answer the second question. Yeah. I think in terms of implementation costs, there are not material implementation costs. In fact, as we look at the new structure, there's some opportunities for synergies to the tune of a couple hundred million dollars. A minimal amount in 2014 is we're basically getting the structure in place, then we see an opportunity in 2015, 2016 to capitalize on the new structure and generate a couple hundred million in operational synergy. So that's how I think about the puts and the takes on that. For 4-1BB, the mechanism seems to activate the immune cells, particular T-cell mediated. You're right, we have been exploring it for quite some time to fully understand its property, and we have studies ongoing, those escalation studies, both as monotherapy and in combination with rituximab in hematological patients. We're also looking at combination of 4-1BB with other immunotherapies as part of our plans, and we will share data as this protocol wraps up at relevant conferences. Thank you. Mikael, next question, please. Your next question comes from Steve Scala from Cowen. Thank you. A couple follow-ups. With respect to the headwinds from the wind down in the Enbrel North America and Spiriva collaborations, would an estimate of a billion-dollar reduction in net income for these collaborations be a reasonable guess for all of 2014? That is the first question. Second is, how do you assess the Herceptin biosimilar opportunity, given that the standard of care in HER2-positive breast cancer is evolving so quickly, and that evolution may limit Herceptin's role over time. Meanwhile, Roche says it will compete aggressively, and there may be other biosimilar competitors as well. Is a shrinking market with unknown number of competitors attractive? Then lastly, on the Staph vaccine, you said data in 2014. On the second quarter call, you had said data later this year. Is there any reason for that slight delay? Thank you. Frank, if you could comment on the alliance revenue, and then John on Herceptin and the nature of that marketplace and the pressures from managed care. I think, Mikael, on the timing. On the alliance revenue, I ran the numbers before on alliance revenue. We will provide an update on the 2014 revenue number and the guidance for 2014 on our next earnings call. We will incorporate into that number, obviously, the impact of the alliance revenue decline on a year-over-year basis. On the next earnings call, we will provide the details on 2014. Okay. In terms of the question on biosimilars, almost by definition, biosimilars do not lead clinical practice, they follow it. Clearly today we know that overall the biosimilars marketplace, the biotherapeutics marketplace, is around about a $100 billion marketplace globally for all biotherapeutics, and that marketplace is expected to grow to around about $300 billion by 2019. I guess first point to make in terms of our presence in the biosimilar marketplace is biotherapeutics overall is a very significant opportunity, and the biosimilar segment of that is expected to grow from its current value of around about $1.4 billion to potentially around about $22 billion by 2020. The key point to make there is, it is a big opportunity. In terms of Herceptin, I clearly don't want to comment on our competitors and any additional therapeutic research that they are doing, other than to say that today Herceptin remains a standard of care for that particular patient population. At the point that we have a biosimilar available to enter into the marketplace, then we believe that that would be a potentially good option for physicians and healthcare systems to use in patients for whom Herceptin or that molecule, trastuzumab, is an appropriate clinical choice. Thank you. Mikael, on timing. Yeah. We have completed successfully a phase I/II trial, and our Herceptin is a very good biosimilar version of the originator, and we are now in the plans of starting a phase III that will be initiating dosing within the next couple of months. Just to add to what John said, clearly, as you discussed, there will be always an evolving marketplace in many of these indications which are driven by a continuous flow of product. We do see still that many of these new regimens include combinations with Herceptin, biologicals on top of Herceptin instead of traditional chemotherapeutics. We anticipate that our molecule could offer a quality alternative. On the Staph aureus, I haven't looked at the transcript. Perhaps we misspoke. I think perhaps we said we had data or had internal data on Staph aureus in that time period that we intend to take it to Congress next year. Probably that was the confusion we created, and if we did, we apologize for that. I think that's right, Ian. It was a presentation of the data. Yeah. Next question, please. Your next question comes from David Risinger from Morgan Stanley. Yes, thanks very much. I just have two questions. First, with respect to the CAPiTA outcomes trial, could you just talk about the reason for the delay in the results, just sort of recap why it's been delayed so long? I'm guessing you're going to say it's simply event accrual, but is there any way to read anything positive or negative into the delays relative to the expected timing when CAPiTA was started many years ago? Separately, with respect to biosimilar Herceptin, do you have agreement with the FDA on how that trial will be run in the U.S.? Also, when do you plan to file biosimilar Herceptin in the U.S. and ex-U.S.? Thank you. Geno, if you'd like to talk about CAPiTA? Yeah, I think on CAPiTA, David, you're right. I probably will say that it's event-driven, and when we have the numbers, we have the number of events. Just to comment on a couple of factors. The incidence of infection often coincides with the severity of the flu seasons, for example. So, if the flu seasons have been milder, then you may not have as many events, and that can be a factor contributing to accumulation of events. Then there's overall efficacy or effectiveness of the vaccine. Obviously, if the vaccine is extraordinarily effective, then the only events that you're going to accumulate are the ones in the placebo group. You won't accumulate any or very few in the vaccine group. That would be a good problem to have. We'll know soon what the real answer is. Thank you, Gino. John, could you talk about Herceptin? Yeah. So, don't want to talk in detail about filing timelines, but in terms of your question about the regulatory pathway, certainly the E.U. and the U.S. have increasingly provided more guidance on the pathways for regulatory approval, which include extensive analytical and preclinical data, robust comparative clinical, and immunogenicity data as well. And that guidance is consistent with our development strategy for our portfolio of biosimilars, including trastuzumab. So we anticipate a phase III start for that program by the end of the year, and we'll be progressing that program in line with that guidance as expeditiously as possible. Thank you, John. Thanks, John. And I think with that, we will complete our call. Thank you very much everyone for your attention this morning. Thank you. Ladies and gentlemen, this concludes today's Pfizer's Third Quarter 2013 Earnings Conference Call. Thank you for participating.