Roche Holding AG
SIX:ROG
Earnings Call Analysis
Q2-2023 Analysis
Roche Holding AG
The company stands firm in its guidance despite anticipating a low single-digit decline in sales. There's a strong conviction in sales trajectory bolstered by a CHF5 billion COVID-19 effects projection. They maintain a goal for core EPS growth to be broadly in line with the sales decline while ensuring a continued increase in dividends.
An impressive 8% growth at constant exchange rates marks a substantial performance across all regions, particularly in Japan, driven significantly by new launch products Vabysmo and Polivy. While facing headwinds like a negative price mix impact and currency fluctuations, their strategic products Vabysmo, Ocrevus, Hemlibra, Evrysdi, Phesgo, and Tecentriq have shown exceptional growth, adding $2.6 billion in new sales and more than offsetting a $0.6 billion loss due to generic erosion of other drugs.
Oncology sales grew 4%, with the HER2 franchise maintaining a strong position despite shifts in market dynamics. Kadcyla remained stable, Perjeta grew by 9%, and Phesgo achieved a significant 69% growth. Furthermore, the combination treatment of tiragolumab, Tecentriq, and Avastin showed promising results, prompting the launch of a Phase III trial. Columvi distinguished itself as a competitive molecule, receiving approval for third-line DLBCL in the US and EU, and the company is rapidly aiming to expand this treatment to earlier lines of therapy.
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Ladies and gentlemen, welcome to Roche's Half Year Results Webinar 2023. My name is Henrik and I'm the technical operator for today's call. Kindly note that the webinar is being recorded. I would like to inform you that all participants are in listen-only mode during the call. After the presentation, there will be a question-and-answer session [Operator Instructions] One last remark, if you'd like to follow the presented slides on your end as well. Please feel free to go to roche.com/investors to download the presentation.
At this time, it's my pleasure to introduce you to Thomas Schinecker, CEO Roche Group. Mr. Schinecker, the stage is yours.
Thank you very much, and hello and welcome, everyone to today's call. I'm looking forward to sharing our half year 2023 results with you. For the first half year of 2023, we saw the base business of both pharma and diagnostics divisions grow very strongly with a total of 8%.
Group sales declined 2% at constant exchange rate, and this was due to the expected decline of sales from COVID-19 products. And this was in line with the guidance that we gave out in the beginning of the year of roughly CHF5 billion for the year.
Pharma grew very strongly at 8%, and this was driven by key products and new launches such as Vabysmo, Ocrevus, Hemlibra, Evrysdi, Phesgo, Tecentriq and Polivy. For the first half year of 2023, we really saw an outstanding performance of Vabysmo, which reached sales of roughly CHF1 billion and is on track to achieve more than CHF2 billion for the year.
The diagnostics base business grew very strongly with 6%. However, overall sales were impacted by the expected decline of COVID-19 sales. For the half year profitability, we had obviously the COVID-19 sales decline and also a base effect from an Ultomiris patent settlement that happened in the first half of the year.
Now coming to the news flow. We've achieved in Q2 numerous very important milestones. Glofitamab or Columvi was approved in third line diffuse large B-cell lymphoma in both the US and in Europe. This is the second CD3 CD20 bispecific antibody that entered the market after we launched Lunsumio at the last year.
In June, the FDA also granted accelerated approval for Elevidys, the first gene therapy for Duchenne muscular dystrophy, together with Sarepta, we're excited to bring this medicine to patients, young boys who have today no treatment options. And we're looking forward to the additional readout of Elevidys later in the year and we can now bring it to markets that accept FDA approval.
We had several important data readouts also in this quarter. Let me highlight OCARINA II, which was the study for six months, subcutaneous Ocrevus that showed positive data and this will be presented at the next medical conference and we also will submit to regulatory authorities towards the end of the year or we will expect actually approval at the end of the year.
We also had a very strong readout for Fenebrutinib, our BTK inhibitor, the only reversible BTK inhibitor in development in multiple sclerosis. And this, again, showed extremely strong efficacy data in reducing brain lesions in patients with relapsing forms of this disease. Another readout, which I think is worth highlighting is MORPHEUS, which demonstrated outstanding efficacy of tiragolumab, Tecentriq in Avastin in first line liver cancer.
Based on this data, we decided to initiate a Phase III study. I'm also excited to share that we've entered two new partnerships. In our most recent deal we brought zilebesiran an angiotensinogen RNA inhibitor for hypertension, which is in-licensed from Alnylam.
This medicine has best in disease potential. We also added KSQ-4279, which is a first-in-class USP1 inhibitor for solid tumors. This protein is involved in DNA damage repair. There's a number of upcoming news flow in the second half of the year. The Phase III EMBARK data for Elevidys in Duchenne muscular dystrophy and a number of other late stage readouts.
For diagnostics, we also expect a number of updates towards the end of the year. On this slide, you can see that, at half year, our sales reached close to CHF30 billion minus 2% at constant exchange rate. But if you exclude the impact from COVID-19, you see very strong growth of 8%. Pharma grew 8%.
At this stage Pharma has no impact from COVID-19. The entire impact at the moment is within the diagnostics division, which had an impact of CHF2.7 billion on COVID testing sales in the first half of the year. Without this effect, the base business is growing strongly at 6%. The growth rates are impacted by COVID-19 and AH&R erosion, but both impacts are in line with our expectations and the guidance that we provided at the beginning of the year.
I would like to mention that there is one impact in Q4 of about CHF1.1 billion in the business of Pharma. This was the Ronapreve order in Japan last year in Q4. Now, this slide is another opportunity for us to really dive more deeply into the sales movements.
As you can see both Pharma and Diagnostics are growing well. Diagnostics base business is growing with CHF421 million. This is a 6% base business growth. You can see the loss in diagnostic testing sales for COVID-19 at CHF2.7 billion and the AH&R erosion of CHF635 million. Again both factors are completely in line with our expectations and our guidance for the year.
You also see the impact of the foreign exchange rate, which was close to CHF2 billion. Our portfolio rejuvenation is progressing very nicely with ophthalmology, neuroscience, hemophilia gaining momentum and again wanting to highlight Vabysmo which is really taking bigger, bigger share and we expect more than CHF2 billion of sales for Vabysmo for this year. This slide we've been showing throughout the pandemic and it really shows the performance of the underlying base business and we see continued strong performance of the base business in both divisions.
Especially in Q2, both divisions reached high single-digit growth in the base business. In Pharma, you can see the orange and gray line being identical this year. So far there is no impact or no net impact of COVID-19 so far, but there is an impact that we expect in Q4.
In Diagnostics, we see the impact, but the impact will get smaller and smaller throughout the remainder of the year and overall the impact from COVID-19 will be done for both divisions by end of Q1 2024, with the washout of COVID sales this year, we expect 80% to 90% of the sales have washed out and the remaining impact will be in Q1 next year, which we estimate to be roughly about CHF1 billion.
Now looking at the profitability. Core operating declined 6% and this was driven on the one hand by the decline of COVID-19 related sales, but also the base effect of the Ultomiris patent settlement which happened in the first half of last year. And you see without this base effect actually we had 0% so the core operating profit was stable.
Similarly, the core EPS declined here by 5%, again driven by the same effects, again excluding the Ultomiris patent settlement in the first half of last year, this would have been minus 2%. Again this is an effect that will not repeat itself in the second half of the year. So we are completely in line with what we said at the beginning of the year in terms of our guidance.
On this slide, you can see the very young portfolio that we have in Pharma. We actually have one of the youngest portfolio of all the different pharma companies with 20 new medicines that we've launched since the end of 2015 and these medicines will carry us forward for the next years. I've already mentioned Elevidys, which recently received accelerated approval for Duchenne muscular dystrophy from the FDA and Columvi which is now approved for third line DLBCL in the US and Europe and we'll take it into earlier lines.
On the right hand side, you can see that this portfolio of medicines, 20 medicines now accounts for more than 50% of the Pharma sales, which is up nine percentage points from half year 2022. You can see the increasing contribution again of Vabysmo as well.
I'm excited to share that we have signed the two new partnerships agreements. One in late stage, one in early stage. We announced in-licensing of zilebesiran from Alnylam Pharmaceuticals. This is an antisense or this is an RNAi molecule targeting angiotensinogen and this really has the potential to change the way hypertension is being treated. There are 1.2 billion people in the world that suffer from hypertension. 80% uncontrolled. So obviously the existing medicines do not work appropriately and the effect on patients is a reduction in life expectancy by five years.
By targeting further upstream and by being able to only give this medicine twice a year, we believe, not only will we achieve better adherence, but we will also achieve more consistent and durable blood pressure control. This is already in Phase II stage of development with more data reading out in the second half of this year.
This asset has the potential to be best-in-disease and we're looking forward to providing more updates in the future. I've already mentioned also KSQ-4279. This is first-in-class small molecule inhibitor and what this molecule does because USP1 is actually involved in DNA repair mechanisms. What it does in combination with other medicines, it makes the tumor more susceptible to cell death by adding cancer medicines. And with that, we believe we can increase the efficacy of medicines.
With that, let me also take the time to invite you to our Roche Pharma Day, which is our annual event focusing on Pharma division strategy and portfolio. It will be in London and the event will take place in-person and virtually.
I would like to also call out two other events. One is an IR event around ECTRIMS where we are planning to share more data on the Ocrevus six months subcu formulation results and also the Phase II data from fenebrutinib.
Later will also share at CTAD, at the end of October, more data on trontinemab, brain-shuttle Alzheimer's medication and we're looking forward to sharing that data with you as well. Now let me provide a quick update on the remaining news flow.
We recently announced positive results for Ocrevus as mentioned earlier. And Teresa will speak more about the benefits of this. We've had negative result on TNKase. And in addition, we will have a number of readouts that will still happen this year. I know one is on top of mind of everyone the SKY-1. This is an event driven trial readout is expected for Q1, Q4 OR Q1, at the end of this year or beginning of next year.
With that, let me say we confirm the guidance. We have a very strong positive sales trajectory, both in the Pharma and the Diagnostics Division in both the base business and we expect roughly CHF5 billion of COVID-19 effect as we have mentioned in the beginning of the year and we are also confident that our guidance in terms of AH&R was correct as well.
With that, again, I would like to confirm the guidance low single-digit decline in sales. Core EPS growth broadly in line with sales decline and a further increase of the dividend.
With that, I hand over to Teresa.
Great. Thank you so much, Thomas. So, as anticipated, it was another strong quarter for Pharma with significant momentum behind our key strategic products and some exciting advances in our pipeline. So let's get right to it.
With sales of CHF22.7 billion, we had strong growth of 8% at constant exchange rates. We had strong performance across all regions. One thing to call out here, you see a very strong performance in Japan. This is partly attributable to about $600 billion Ronapreve transaction which was the last tranche of the sale that happened at the end of last year that Thomas mentioned.
Without that growth in Japan would have been 9% largely driven by two launch products Vabysmo and Polivy. Overall Pharma volumes were up by 14%. Price mix impact was a negative 6% and we faced increasing currency headwinds of about negative 6% which Alan will go into more detail with momentarily.
Moving onto our P&L slide. Please note that this is the first time that we're using our new reporting structure to actually show the P&L. So we mentioned this last year. This is the first time you're seeing it in this new format. Core operating profit increased by 5% at constant exchange rates versus that 8% sales increase with the core operating profit margin of 48.6%.
Other revenue decreased by 45% and that's primarily a result of the Ultomiris settlement, which was booked in the first half of next year of last year and then other operating income you see a significant increase here as well of 79% and that was primarily driven by higher gains on two divestments Rocephin in China and Xeloda in China and Japan.
Moving onto the performance of our individual products. Again just a comment on the graph. Recall that all of these are absolute values and growth rates at constant exchange rates. You can see just as Thomas mentioned just incredible momentum behind our key strategic products Vabysmo, Ocrevus, Hemlibra, Evrysdi, Phesgo, Tecentriq, Polivy all growing extremely significantly. Combined they added $2.6 billion of new sales. That's more than compensating for the 0.6 billion in generic erosion that we saw with Avastin, Herceptin and MabThera in the first half of this year.
A couple of specific comments here. Let's start with Polivy at 114% growth. This has certainly spurred on by the FDA approval of first-line DLBCL in the US, but what we are seeing is everywhere where we get approval and reimbursement for Polivy. It is quickly entrenching itself as a standard of care.
Some of the comments that we're hearing from our physicians are things like it's the easy choice for patient with first-line DLBCL because it's their best chance for cure. We are also increasingly hearing from both regulators and from clinicians that when new trials in first-line DLBCL are being initiated, there is a desire to have Polivy and the POLARIX regimen, at least as an option in those trials. And I think that's a really great indication that people do see this as the next standard of care. And then obviously, as Thomas mentioned the standard on this slide just has to be Vabysmo.
It is now our number one growth driver getting to that blockbuster status at constant exchange rates and there's really just one word for Vabysmo that's momentum and we'll talk about it more, a little bit later in the presentation. But let's start with oncology. Oncology sales increased year-to-date at 4% adding CHF9.8 billion in revenue.
Starting with HER2 franchise. As we have been signaling Kadcyla is essentially flat ex-US. We are seeing growth, especially in China and Brazil in early breast cancer compensating for a loss in the metastatic setting in the US and in the EU. This was something that we fully expect it to happen. We're seeing that dynamic play out in the market. Right now, we're at about 70% early breast cancer, 30% metastatic. And we would expect this dynamic to continue going forward and for Kadcyla sales to remain stable.
Perjeta continues to grow at a healthy 9% both in the US and international. But the real standout here is Phesgo growing at 69%. We are now at 35% conversion in our early launch countries. We would expect this to grow to over 50% over time. But I think what's really most exciting about the Phesgo launch is what we're seeing is actually in places where Phesgo is gaining traction.
We're seeing increased usage of Perjeta. And so combined I think this is just a tremendous story. We added eight new early launch countries for Perjeta -- for Phesgo since Q1 and that's sort of why you're seeing that global conversion rate remained stable, despite the fact that we have now had a launch, had an increase in US share.
But going forward, we would expect to see continued strong growth for Phesgo and therefore for Perjeta. We'll talk about Tecentriq a little bit later. Hematology franchise I think we've been consistently saying that hematology is a place to watch. This gives you a sense of why Gazyva up 22%. We talked about the incredibly strong performance of Polivy and we'll talk more about Lunsumio and Columvi on the following slide.
And then finally just two last but never least Alecensa strong growth in the first-line ALK+ cancer setting and we see the long-awaited lean adjuvant data in just a couple of months and so very likely that we'll continue to see good strong growth in Alecensa in the adjuvant setting.
Moving onto tiragolumab. We continue to have a high level of commitment to tiragolumab and that is our confidence is reinforced by those positive early results we saw in first-line HCC. We just recently presented at ASCO. The first, the Phase I/II Morpheus study showed a very significant PFS and overall response rate benefit for the tiragolumab plus Tecentriq plus Avastin combination with no new safety signals. This has encouraged us to start a Phase III trial SKYSCRAPER-14 in this area.
And then I think Thomas mentioned earlier the readout of SKYSCRAPER-01 in first-line non-small cell. That is an event driven trial and those results are now expected in Q4, Q1. Moving onto Columvi. So Columvi is now approved in third-line DLBCL in the US and the EU.
It is the first and only bispecific offering a fixed duration treatment in third-line DLBCL. Those complete response and overall response rates are very significant with a very healthy duration of response. The fact that this is an off-the-shelf treatment, but that provides this level of complete response in addition to this level of durability in less than 50% of the visits that we see with competition. I think make this just an incredibly competitive molecule and definitely one to watch.
You can see on the right side of this slide that we have a very robust CD20, CD3 development program for both Columvi and Lunsumio. This is really designed to ensure that we get into earlier lines of therapy as quickly as possible with both of these drugs and combinations that makes sense because both have a really important role to pay in the treatment of patients.
Moving onto Tecentriq. Tecentriq is the first PDL -- PD -- PDL1, PDL with pivotal subcu trial results, which have now been filed in both the US and the EU. We expect the US PDUFA to be on September 15th. The subcut just to remind you, reduces administration time from -- to seven minutes from 30 to 60 minutes for IV, which offers far more convenience to patients and HCPs as well as freeing up resources and highly constraints systems.
As you recall the Phesgo conversion in countries like Great Britain is up to 92%, which actually shows that when you actually have a dosing formulation that increases convenience and administration, in this way, you could actually see very significant uptake and we would see -- we would expect to see something similar with Tecentriq.
Sales growth for Tecentriq is driven primarily by first-line HCC in some European markets and the ongoing adjuvant non-small cell launches as well as global expansion. Looking forward, we are expecting to see the results in adjuvant head/neck later this year.
Moving onto Hemophilia A and Hemlibra. What is there to say about Hemlibra. It remains the global standard of care and frankly just keeps expanding. US/EU patient share has now reached 39%. We have more than 21,000 patients on therapy. We are getting increased penetration across all approved patient segments.
And I think what is actually so exciting about Hemlibra at the moment is that we're seeing in certain countries I think Great Britain is one of these, France is another, where we're just seeing the peak non-inhibitor sales surpassing 60%. So these are already places where the inhibitor population is fully penetrated with almost every eligible patient being on Hemlibra and we're really starting to test our own assumptions about what peak share for Hemlibra ought to be just understanding that the high level of effectiveness high level of patient satisfaction.
The fact that two-thirds of our patients are already on every other week or monthly dosing. It just starts to give you a sense of what Hemlibra is really done in terms of changing the face of the Hemophilia A market. We expect to present some additional data on Hemlibra at the upcoming ISTH Conference, which again just continues to demonstrate the high level of confidence that we have in prophylaxis and the quality of life data. I did just want to note here that the SPK-8011 pivotal Phase III gene trial gene therapy trial has been initiated. This trial is expected to enroll patients in both the inhibitor and non-inhibitor population. So we look forward to being able to share more data with you about that in the very near future.
In terms of immunology, not too much to say here a negative 11% growth for the first half primarily driven by generic competition in Esbriet. We expected that to go quickly. It did. The Actemra, it has no more COVID related 19 has no more COVID-19 related sales. Thomas mentioned this a little bit earlier. But that shift from IV to subcu continues subcu share is now at about 60% modest growth in this space, but clearly holding its own in terms of RA share.
For Xolair, we have a very respectable 4% growth primarily driven by CSU, but interestingly, there are some exciting data coming out for Xolair later this year, the Phase III OUtMATCH study. This is Xolair in food allergy. We expect to see those results and then we also expect to see the US approval of the US Xolair auto injector in the U.S.
In terms of other updates in Q2, we launched the Phase III IMAGINATION trial, which is our ASO factor B in IgA nephropathy has now been initiated has the Phase III ARNASA study, which is the second Phase III study for astegolimab in COPD. So Aste is one of the newest entrants into our Phase III portfolio in development for COPD and has the potential to become a first-in-class anti-ST2 receptor antibody. Unlike other biologics that are in development for COPD astegolimab targets this ST2 IL-3 receptor as opposed to the Ligand.
So this is expressed on various immune cells, but it doesn't actually intercept the signaling protein IL-33 itself. This gives at a very differentiated mechanism of action, relative to the other things that are in the clinic right now for COPD and what gives confidence about astegolimab in this area. I mean I think that's largely driven by the results that we saw in the Phase II COPD ST2OP trial.
And again you can see here that you had respectable AER reductions higher in our eosinophilic low population as well as its reduction of SGQR and increased FEV results. This trial was not powered to actually provide sort of more statistically significant results. But what it did do is directionally tell us that we really believe that there is an opportunity for astegolimab to be quite transformational in the COPD population.
I think everybody knows that COPD is a very significant disease has high mortality and morbidity. It is a very large population and right now there really are very few. There's no biologics approved in COPD and really very few treatments for these patients.
We are enrolling a broad patient population, including former and current smokers as well as the eosinophilic low and high patients and we really do truly believe that we might have something very special here with astegolimab in COPD, which will be the first thing that could potentially help the entire breadth of patients who suffer from this quite devastating disease.
Moving forward into multiple sclerosis. On July 13th, we announced positive topline results for the Phase-III OCARINA study. This is our six-month subcut study with Ocrevus. All the primary and secondary endpoints were met and detailed data has been submitted to an upcoming conference.
Results will be filed with regulators globally at the back half of this year and we expect approval in 2022. We expect the introduction of subcut for Ocrevus to expand the usage of Ocrevus the standard of care in MS and high efficacy therapies to clinics with limited or no IV capability, but it can also be an option for those larger clinics who currently may have IV capacity, but would actually like to be able to expand the number of patients that they treat.
I think there has been some confusion about what this program actually entails and so let me try and clarify. The OCARINA original study was Ocrevus every six months designed to support the potential for an HCP, a neurologists or nurses or pharmacists to administer either inside or outside of the clinic setting at their discretion.
The initial launch will be a syringe pump and will be administered by a healthcare professional either at home or in the office. We are currently evaluating a self-administration option that can actually be delivered via an on batch, on-body injector a patch pump and we expect this option to be available in the mid-term.
Details on this program will be provided a little bit later, but it is definitely something to watch. In other news Ocrevus continues to be a market leader, 22% share globally over 300,000 patients treated. We are the market leader in the US and the EU5, again the data that we have in MS continues to be untouchable from a relapse and remission perspective.
We have extremely high persistence and compliance and extremely high patient satisfaction. We also would like to report that the Phase III high-dose studies have now been fully recruited and we would just continue to see the high efficacy market for multiple sclerosis expand in general and for the Ocrevus share of that market to continue to be dominant Thomas indicated that we also saw in Phase II, I'm sorry, we also saw in Q2, positive Phase II trial results for FENopta for fenebrutinib in RMS and so let's take a look at those.
So these were recently presented at the EAN Congress and I think there's just stunning results. As you know fenebrutinib is a highly selective and the only reversible non-covalent BTK that is currently in development in Phase III for MS. You can see from the data that was presented from the Phase II trial that we have significantly reduced brain lesions.
Patients on fenebrutinib are four times more likely to be free from lesions at four, eight and 12 weeks versus placebo. These are not only comparable to anything that we've seen in the market, they are not only better than what we've seen there actually comparable to what we see with high efficacy treatment including Ocrevus, which is really, really impressive considering that this is an oral medication.
The safety profile has remained consistent as you are all aware fenebrutinib has been in trials in multiple indications over time. We have more than 2400 patients who have now been exposed to fenebrutinib over 1,000 MS patients and we continue to see a very consistent safety profile.
While we do see some liver elevations, they are transient and reversible, and we've seen no cases of Hy's Law that we continue to very closely monitor our patients and safety is our number one priority. The Phase III trials both in RMS and PPMS are ongoing and we are very excited to see what this could mean for MS patients around the world.
Spinal muscular atrophy, Evrysdi, remains on track to become the number one treatment for children living with spinal muscular atrophy. We're now at over 8500 patients globally. As a reminder, we were at about 7,000 patients at the end of last year. Evrysdi is well tolerated. We continue to see very high retention in the first 12 months of therapy and excitingly, we are now starting to see that penetration into the older patient population and that's really where the majority of SMA patients set patients who have never actually been on treatment for their disease and we are starting to see penetration there, which is great.
The new FIREFISH data were presented at Cure SMA and I think just draw double underline under the very strong efficacy and safety profile that we're seeing with SMA across all ages and across all types. Thomas mentioned Elevidys. I share his excitement for this drug. We now have the first approval in the US from -- for our gene -- for our first DMD gene therapy with our partners Sarepta.
This approval was based on a pooled analysis of a number of studies that had demonstrated functional and clinically meaningful results. The US accelerated approval is in that four to five-year-old ambulatory patient population. As Thomas mentioned, we do have the opportunity now. We hold the ex-US rights. We do have the opportunity to file in selected countries that reference US approval and those initial filings are underway.
You can see on the right hand of the slide that we have a very significant development program underway for Elevidys looking across all ages and ambulatory statuses. As we have always said, we believe that we will need the Phase-III EMBARK results to file ex-US. Those are expected in Q4 of this year and we are really looking forward to the opportunity to bring this very promising treatment to boys and their families all over the world.
And now going into Vabysmo. So again, as I mentioned earlier in the presentation, there really is no other word for Vabysmo than momentum. We have now reached US market shares of 15% in nAMD, 9% in DME, $1 billion sales by -- constant exchange rates by the end of this year -- by the middle of this year. Well on track to be $1 billion brand in 2023. A couple of things that I think are particularly interesting. When we talked, in Q1, we were kind of in the teens on the number of naive patients that were getting Vabysmo.
We are now at about a third of patients of naïve. In Vabysmo you're seeing about a third of patients who are naive receiving Vabysmo and most of our switches are coming from aflibercept. Everywhere we launched and gain reimbursement. We are seeing very fast uptake. We have double-digit market shares at this point in many of our early launch countries and really what we just continue to hear from people is that Vabysmo is the new standard of care. They try it, they love it, their patients love it. They use more of it. It's really fantastic.
In Q2, we also filed for the third potential indication for Vabysmo, RVO in the US that PDUFA date is set for the 22nd of December, that EU filing is happening in the second half of this year and starting tomorrow actually at ASRS we do plan to present a significant new tranche of data that really looks at and I think gets to the heart of why we think Vabysmo is such a special medication. And I think that has to do a lot with the actual nature of the molecule that bispecific design.
I think we all know that in these diseases neovascularization has caused by that elevated VEGF in the system and that's why those anti-VEGF therapies, they work fairly well. But what we have in Vabysmo that is so special as we have that Ang-2 arm, we have the ability to block Ang-2 which we know leads to vascular leakage inflammation fibrosis things that are anatomically very important to retinal specialists, when they think about actually being able to control those things to preserve vision for patients.
And so Vabysmo's dual pathway really does I think make ultimately a very big difference when we think about the benefits that we see for this drug in the drying in the duration that dual pathway is certainly something that is really proving to make a difference.
And last but not least Zilebesiran. So I'm just so excited about this partnership Thomas touched on it earlier, but this is a place hypertension again Thomas mentioned this. There's 1.2 billion people around the world who suffer from hypertension, about 80% of those people are unable to control their hypertension with the drugs that currently exist in the market today. And Zilebesiran acting in the liver upstream of the traditional RAAS cascade really gives us the opportunity to have a very different level of control for these patients.
The Phase I results were published in the New England Journal of Medicine about a week ago. And those Phase I results, again, I think you would just have to call them stunning. The ability to reduce by 90% serum angiotensinogen for up to six months with a single dose is just really incredible and providing that consistent control both during the day and during the night. Again I think this is a drug that as Thomas mentioned earlier has the potential to be absolutely transformative for a significant number of patients.
As Thomas mentioned we have two Phase II studies that are currently already ongoing with Zilebesiran KARDIA-1 monotherapy study in mild and moderate hypertension and KARDIA-2 which adds on to standard of care. We expect data from KARDIA-1 sometime in the next quarter and in early 2024 for KARDIA-2.
So definitely a partnership that we're extremely excited about. We think that the partnership with Alnylam is really destined to be a really fruitful one and we're excited for the opportunity to bring Zilebesiran to patients in the future. And then finally, let me just quickly just touch on some major updates since Q2. So we talked about our regulatory approval with Columvi. We mentioned the Phase III pivotal trial readout for TIMELESS, Thomas did that right up front.
We have a couple of studies that have now shifted into 2024 SKYSCRAPER-1. The GeparDouze study which is Tecentriq and TNBC. The STARGLO study and Lunsumio and Polivy in second line DLBCL. We have a couple of remaining readouts in H2. We talked about Tecentriq and adjuvant small cells, I'm sorry, in adjuvant head/neck. The ALINA trial, that was Alecensa and adjuvant ALK+ patients again something that we think is going to be potentially really impactful and then Venclexta will read out two additional studies of multiple myeloma and MDS2 studies that I think we've been excited and waiting for quite some time.
And so with that I will pass it over to Matt.
Thanks, Teresa. So it's my pleasure to present the half year 2023 Diagnostics division sales and P&L results. And with that and with sales of CHF7.1 billion, the Diagnostics division declined by 23% or CHF2.3 billion at constant exchange rate and this decline is entirely driven by the decrease in COVID-19 testing sales by minus CHF2 billion at constant exchange rate and offset by good base business growth of plus 6%.
So you saw this slide earlier in Thomas 's presentation. And here you see the performance of the Diagnostics business over the last six quarters. I'd like to start by focusing on the orange line. This represents our base business performance and you'll see in Q2 of 2023, an 8% growth. Now in Q2, excuse me. this includes a tailwind effect from the lockdowns in China in Q2 of 2022, but this was offset by the headwinds of our COVID related business impact such as Custom Biotech where we make testing components for other companies involved in COVID-19 testing which has declined along with COVID-19 sales.
So when these two effects are taken together, the strong plus 8% base business growth reflects the underlying performance and growth in our base business. So now I'd like to turn your attention to the blue line. This is the total diagnostic sales, which includes COVID-19. Here the impact of COVID-19 is less in the second quarter with total sales declined by minus 17% and this trend confirms that the COVID-19 business is starting to washout of our overall diagnostics sales.
So for the second half of 2023 we're expecting mid to high single-digit growth of our base business. While COVID-19 testing sales will continue to decline. And now I'd like to take you through the sales results by product category. And really starting with our main driver, which is the Core Lab. Here, the business increased by plus 10% with very strong momentum driven by immunodiagnostics and clinical chemistry.
Additionally, the base sales excluding COVID-19 such as Custom Biotech increased by plus 12%. Molecular Lab, as you see, had a decline of minus 40% due to lower COVID-19 PCR lab based testing sales. As the COVID-19 pandemic has ebbed clearly this has had an impact on the sales in Molecular. However excluding the COVID-19 related business, our core base business growth was plus 6% and this is due to strong growth in cervical cancer testing, plus 24% our blood screening business, plus 13% and our core virology base business which also grew at plus 5%.
Next you'll see our Diabetes Care business, which had a 5% decline. Now this decline is driven by the shift from traditional blood glucose monitoring to continuous glucose monitoring and we expect this to continue as this market trend continues.
Sales in the Pathology Lab grew strongly at plus 12% and this is mainly driven by advanced staining, immunohistochemistry reagent growth and companion diagnostics. Our point-of-care business had a decline of minus 74% and this is again entirely driven by lower COVID-19 rapid antigen and COVID-19 molecular point-of-care sales.
Our base business grew at plus 4% and this is really driven by the Q1 sales of our point-of-care Molecular Liat business, which was supported by the strong respiratory season in the Northern Hemisphere in the earlier part of the year.
And so with that, if we look across the different regions, what you'll see is the impact of the lower COVID-19 testing sales across every region in which we operate, but excluding this COVID-19 effect we see really strong growth of our base business.
So in North America, the divisional base business excluding COVID-19 related business grew by plus 5%. In EMEA, the base business excluding COVID-19 related business also grew by plus 5%. In Asia-Pacific, our base business grew by plus 13% excluding COVID-19 related business and in Latin America sales grew by plus 20% excluding all COVID-19 related business. So really great performance across all the regions.
Now, I'll walk you through the restated P&L and its new format. And what you see here is core operating profit declined by 36% and again this was driven by the strong decline of COVID-19 sales, but partially offset by improved margins and a decline in SG&A. Our cost of sales, declined to 26% faster than sales and this is due to lower sales of COVID-19 rapid antigen tests as well as productivity gains.
R&D increased by plus 2% and this is driven by higher investments in the area of innovative instrument developments and as well mass spec and digital solutions, excuse me, including mass spec as well as our digital solutions. SG&A decreased by minus 2% and this is thanks to lower distribution costs associated with rapid antigen, but also good cost discipline across all our SG&A lines.
And so now I'd like to turn to the topic of some of our innovative developments particularly instrumentation and specifically our new analytical mass spec instrument. So at EuroMedLab, we exhibited this highly anticipated cobas i601, the first fully automated analytical mass spec unit which will revolutionize mass spec testing in the clinical lab.
So today mass spec is the gold standard in applications where the highest level of sensitivity and specificity is required. And until now mass spec testing has been run in a separate area of the laboratory due to its very highly specialized manual workflow and its current use is limited by the manual and time-consuming procedure of running a test. The i601will be fully integrated to an existing serum work area workflow, which means it will be combined together with our Clin Chem and immunoassay and could be put on line containing those other systems.
It will be fully automated, random access and capable of delivering up to 100 samples per hour with more than 40 key parameters such as Vitamin D, therapeutic drug monitoring, immunosuppressives and steroids available at launch. The instrument will be launched at the end of 2024 in countries accepting the CE Mark and we would plan to launch in the US, the following year.
We expect a second wave of menu additions with 20 plus assays in development, which would include drugs of abuse testing following shortly thereafter and the customer feedback on this system has been very positive and we're really looking forward to the launch.
So, now turning to another key focus for Diagnostics which is access and really highlight the positive progress we're making to provide access to critical Diagnostics in low-and middle-income countries, specifically the x800 molecular HPV test where we received WHO pre-qualification in May of 2023.
Cervical cancer, as many of you know, is slow-growing and very treatable if caught early, but today the global health disparities large with 9 and 10 cervical cancer deaths worldwide occurring in low and middle-income countries. 91% of women in low and middle-income countries have never been screened for cervical cancer, as opposed to 16% in high-income countries.
Now in 2020, the WHO launched the cervical cancer elimination agenda and issued guidelines recommending HPV-DNA primary screening for all women. Receiving the WHO pre-qualification is a good step to increase access because many countries require this as the regulatory standard and it opens access to tenders and further establishes Roche Diagnostics as a global leader in the space.
I'd like to call out that currently 36 of the countries that rely on the WHO pre-qualification already have x800 instruments and we can move quickly to respond to national tenders for cervical cancer screening. We will also continue to shape the local environments to ensure cervical cancer screening is a health priority in these countries.
So now I'd like to turn to another key part of our Roche strategy which is precision medicine and in particular, oncology. We've recently launched two important Diagnostics in the brain cancer space IDH1 and ATRX immunohistochemistry screening. Glioma constitutes today around 340,000 cases per year and 75% of those are malignant disease. These two tasks allow laboratories and physicians to quickly, accurately and cost effectively identify mutations into very important genes for patients affected with gliomas the most prevalent type of brain cancer.
And identifying the patient's mutation status in these genes more precisely subtypes the glioma patient diagnosis and as you can see in the WHO algorithm on the left, the subtyping is important as these biomarkers are both prognostic and predictive, allowing the glioma patient and their clinicians to better understand the most optimal care decision.
So the IDH1 and ATRX launch brings our portfolio of neuropathology biomarkers to 29. These assays run on our benchmark series of instruments the Ultra and the Ultra Plus. Thus making them currently available to laboratories in the US and beginning in 2024 available worldwide and now I'd like to just briefly cover the launches in the first half of the year.
So in the first half of the year, we launched three of our key launches for 2023. The other ones are on track and I very much look forward to updating you in subsequent meetings.
So thanks very much for the attention and now I turn it to Alan.
Yes. Thanks, Matt.
Thanks, Alan.
It's my pleasure now to lead you through the finance figure. I hope everybody is well and safe and healthy. When you look really at the highlights, I will touch on all of them. Yeah, let me just say I think great progress for Roche in the first half year.
You will see the underlying sales growth and you've heard about it already, which has done really, really well. It gives us certainly a great perspective, the pipeline has improved. And I would argue the overall results are pretty solid.
I think as Teresa and Matt said, I think we have made some changes in our P&L. So the new income statement presentation is effective now of January 2023 and at full-year 2022. We have shown you the impact already, but nevertheless, let me lead you through what we have changed.
First of all, we have merged M&D and G&A to SG&A. Simple reason you want to be really comparable to our peers and I think that makes it easier. The second bullet point, I think this is something which came in from IFRS to move here. So we really came in now with the line, other revenues.
You will find here basically the royalties and the royalty income. And we have introduced the line, other operating income and expenses and that's where you normally will find the disposal gains. And then in total we have simplified our allocations. We have quite an extensive allocation structure that we have followed. We simplified that really radically. And that has an effect on the divisional results.
Consequence of all what we have done is, well, when you look at it, I think the key metrics for sales grew operating profit and EPS are unaffected. So really comparable to the past. We have not changed the core reporting concept. So that's the same. The changes to allocations will reduce the allocated cost to divisions and increase the divisional margins by around four percentage points to five percentage points.
Good, with that, let's get into the numbers. When you look at the group performance and here is really the overview. You see that the sales decline on the right-hand side in concentrates by minus 2% you'll see by the way the impact. When you look at Swiss franc from currency and will come up with a statement later on. I will talk about currency.
So when you look at the minus 2. I think as said the underlying growth is great. DIA plus 8%, DIA plus 6%, pharma plus 8%, overall plus 8% and then I see we have lost CHF2.7 billion COVID sales that leads us to the minus 2. You'll see the core operating profit down minus 6%. Normally we would always have the aspirations that should be in line with sales at least halfway in line with sales.
Here the argumentation is Ultomiris patent settlement income of the first half 2022. If you are adjusting for it, I think that accounts for 5.3 percentage points of the minus 6%. It would be basically flat.
So I would argue a pretty solid core net income was a minus 7% here. Interest charges play a role which have increased. You'll see core EPS was minus 5%. So you ask yourself, okay, core operating profit down 6%, core net income down 7%, while the core EPS just down by minus 5 and that's really also Ultomiris because Ultomiris comes from Chugai and we own 60% of Chugai.
So that's minorities effect which comes in here. IFRS net income is minus 9 certainly result of the operating results as well as the higher interest charges and then you see the cash flow is still solid with CHF8 billion.
Nevertheless a minus 8%, minus 8% is basically the Ultomiris impact much plays a role here and you see the minus 18 is currency as well. But as I said, I will talk about it. Free cash flow just down by minus 2%. Here is an effect from tax payments, which we have moved into the second half of the year.
Good. With that let's move to bridge slides that Thomas has talked about already. I don't want to stress it again too much. I think here, you will see very well outlined the Diagnostics, what we have lost the CHF2.7 billion you see the base business in Diagnostics, which has grown so well. You'll see the Pharma base business was CHF2.4 billion, which is really impressive. You see there was basically no impact from Ronapreve and you see certainly the erosion coming from AH&R and the significant currency impact.
When I started here and that's the right hand side in 2011, we had three blockbusters. Today we have 16 blockbusters. So I think quite well diversified and quite some significant growth of the company over time. Good, with that, let's go to the P&L. And let me start on the right hand side because these are the numbers, which are familiar to you with minus 2% on sales and minus 6% on core operating profit and now you see where it comes from. So let me move now into the middle column with the absolute CER numbers.
You'll see sales down 540 million. Other revenue down by 685 million. Ultomiris once again with the 668 then the cost of sales, a positive of 1.1 billion. I think you've heard from Matt, Dia down 26%. Their volume came down by 23% and they even overcompensated by their cost decline, Pharma plus 3%, with volume growth of 14%. You see R&D was a minus 486 that's driven by Pharma and basically solely driven by Pharma computation biology, oncology, neuroscience at all played a role have initiated quite some Phase III trials.
You'll see SG&A up 392 million. I would argue one half of it is really M&D on the Pharma side. So really we supported our launches and our current products and the other piece is coming from G&A that informatics with roughly a $100 million. We have applied really new things in the Company due to business needs. And then a little bit coming from other areas and then you see other operating income and expenses. And as said, I think, these are basically the gains from disposals and they are 305 million higher compared to previous year, which leads us to a core operating profit decline of 704 million.
Good, with that, once again, as this other revenue topic. I don't want to stretch it too much, but it is quite significant. What role Ultomiris played here. So from 1.6 billion down to 837 on the right hand side. And then you see that huge red bar in the middle was a minus 691 and the 668 of this is coming from Ultomiris and then you see the royalty income, which is down which is driven by Lucentis and that's quite a natural development was successful with Vabysmo.
Good. Core operating profit and the margins, you know, we have the mantra to defend the margin and I would argue that has happened because when you look at Roche Group. Yes, there is a decline of 1.6 percentage points. But when you exclude Ultomiris, I think you get to a plus 0.5. So I think mission accomplished at half year. When you look really at the Pharma division when you exclude Ultomiris was quite a significant increase and then you'll see Diagnostics where we have lost 2.7 billion in sales and then it's pretty clear that you also take a hit on the margin.
Good. Let's go to the core net financial result with a moderate decrease in the reported numbers of 24 million when you look really in constant currencies, it's the CHF75 million and you see where it comes from the equity securities have done rather well to the Roche Venture Fund I think illustrates where the market has gone and that valuations in the market have gone up. You see the net interest income. Well, we get some interest net now for our liquidity, first time for a long time. You see really currency. It's a base effect from last year you had some currency gains last year.
And then the interest expenses which moved up by 147 million reported which is clear with the rising interest rates. With that, let's go to the tax rate. And when you look at the tax rate, I think very clearly on the left hand side, you see we had last year release of a tax provision of roughly 300 million, that's certainly brought the tax rate, significantly down to 16.1% half year 2023, we ended up with 16.9% and you ask yourself, okay, how can that go if there is no special effect in here.
And once again it's Ultomiris because Ultomiris as said stems from Chugai. Chugai has a higher tax rate in Japan compared to the Group tax rate. So when we now miss it in the first half of 2023 suddenly that has a negative effect on the group tax rate overall. So we ended up at 16.9%. Good Core EPS development the bridge. So a little bit of a summary here and you see it half year 2022 with 11.77% and you see half year 2023 with 11.23% so a decline, you see the operations, which is basically the residual here of the minus 5% here, minus 4.6% decline.
You see Ultomiris had an impact of minus three percentage points. You see the gains and losses on equity securities. You have seen the 151 million positive, that's certainly a positive impact. I explained the tax rate change and then a small impact from other. Good. Non-core items, equally important, because it illustrates how we get from the core operating profit to the IFRS operating profit and then to the IFRS net income.
First, when you look at the right-hand side you see there is not much of a difference. You go from the core operating profit minus 6 to the IFRS operating profit was minus 7 and when you really look into the absolute numbers, not much of a movement. Overall, I go to the details in a second, when you see the minus 7% to the minus 9% there for FRS net income that's driven by higher interest charges.
So let's look a little bit into the specifics. You see the global restructuring plans with a minus 678 million increase of 400 million. But nevertheless, I would argue, still in line with historical measures here. But nevertheless certainly we are driving improvements in the company and want to do this, that results in future benefits that help us. Amortization of intangible assets, we've done a couple of write-offs in the last years.
I think that helped to bring that number a little bit down. You see 110 million improvement. The impairment of the intangible assets, you know, they come when they come and when we have study results. So a 260 million at half year 202, 163 million better than last year. M&A and alliance transactions very small. And then legal and environmental, we had a release here of a rather significant provision for our trials.
So quite successful of roughly 130 million and that drove that number to a positive 150 million here. So as said IFRS operating profit down minus 7% in concentrates rates that leads to the IFRS net income down by minus 9.
Okay. Let's look at cash and the balance sheet a little bit. And when we look at cash, as said there is a reduction from 9.8 billion to 8 billion. The major part really is Ultomiris, the rest is currency, I can say, but I will come, you see the Pharma division quite successfully in half year 2023 and then you see the decline on Diagnostics, which certainly is driven by the lower volume and the lower sales, driven by COVID. Good. Let's look into the Group operating free cash flow.
So from 9.8 billion to 8 billion as mentioned and you see the operating profit, net of cash adjustments came down by 946. Very clear. Lower sales significantly lower sales therefore lower operating profit and certainly no Ultomiris. So that's the explanation here. All the rest balances out pretty well. When you look at net working capital, which contributed positively investments in PP&E , investments in intangible assets pretty balanced.
And then the foreign exchange impact of a minus 978 million leads us to the solid 8 billion. When you look at the Group net debt development. First, let me start on the right hand side with the net debt of 17.9 billion at half year 2023 when you compare it to the status last year at this time, we had a minus 20.9 billion. So we reduced that in a one-year time frame by roughly 3 billion.
So I think that's a nice achievement when you really look at the left-hand side, that is the net debt position, beginning of the year. The minus $15.6 billion. We have increased a little bit and that's certainly you know that it's always the same rhythm. We paid the dividend in the first half and the dividend 7.8 billion and then the rest of the year, if you like, we work against that with the free cash flow.
So I think it's fair to assume that we can improve our debt position further until the end of the year in the absence of significant M&A. Then let's move to the balance sheet. When I look at the balance sheet, certainly I can make here, a lot of comments if needed. But I think when you look in concentrates, not a lot has happened here.
I think it's pretty stable. The only outlier is cash and marketable securities was minus 16% and that's really driven by the payment of the dividend, as mentioned already all the rest is pretty stable. You see equity ratio is 36%, net debt to total assets at 21% a lot forget that we have 25.6 billion of gross debt on the balance sheet.
Good, with that, let's go to the outlook. Let me start with currency and I know that's a topic and let's focus first on the left-hand side and you see really the Swiss franc to US dollar development and you see really in Q2, the US dollar has weakened significantly against the Swiss franc. You see the impact in Q1 was zero and then in in Q2 and half year than it was minus 3 percentage points. So really, really significant year and when you look at the Swiss franc to euro you see basically the situation remains with a minus 4 percentage points and a minus 4 percentage points.
And now I come to the right hand side, where you see once again the half year impacts with minus 6 for sales, minus 8 percentage points for core operating profit and a minus 9 percentage points for core EPS and now we're going to assume as always that the exchange rates of the end of June remains stable until the end of 2023, which is not very likely to say, but just from a modeling point of view and from an assumption point of view that would leave us in September year-to-date with a minus 6 percentage points on sales and on full year with a minus 7 percentage points on sales minus 9 percentage points on core operating profit and minus 10 percentage points on core EPS.
Let me make here a comment about how concerned should we be about this. Because, well, at the very end, it's really about cash and cash impact and you've seen there's a cash impact, at least from an accounting point of view, you know that we have a pretty good natural hedge globally.
That means that the markets where we have high sales we normally also have a very high cost position, predominantly that's the US and you can come up with euro. So really into the, in the euro currency, but also China in all of these regions we have full value chain.
And that means there is a pretty good hedging between these things does that's more often accounting impact. So not too concerning from today's point of view and the Fed has increased the rates yesterday when I remember it well. So I think there is some hope that the US dollar will strengthen in a certain timeframe.
Good, with that, once again we confirm the guidance, as Thomas has said already, I don't want to dig more into this, because, well, we would like to answer your questions.
And with that I hand over to Bruno. Thanks.
Thanks a lot, Alan. I think we have 11 analysts here in the row raising their hand. I think we just agreed that we will do 40 minutes of Q&A to give all of you the opportunity to ask two questions. Two questions please. And I would also like to ask the speakers to be crisp in their responses. So first one would be Sachin Jain from Bank of America. Sachin, please two questions.
Hi. Thanks, Bruno. And I'll stick to two questions. So just two big picture ones if I may. So firstly for Thomas. Should we review recent BD focused at Phase I/II is a sign of where your greater focus is in stage of doing BD or could you comment of potentially doing later stage assets Phase III launch ready. Just wondered now these six months into the Group CEO role, what's your assessment of need to bolster late-stage pipeline will add further growth driver short-term and then the second question is for Alan, just to get a sense of sustainability of this growth into '24? So, second half growth is looking mid high single digits, could you just talk about a very high level, the sustainability of that into '24 initial perspectives on pushes and pulls as we see the key drags next year will be Actemra biosimilars and COVID anything else we should be aware of and any new positive drivers you'd like to flag? Thank you.
Hi, Sachin. Happy to take the first question. First let me again highlight on market portfolio. We have 20 new medicines launched since the end of 2015 and these medicines will continue to drive growth. Second and I think Teresa did a great job of highlighting a number of very interesting assets that are in late-stage pipeline. Third, when we look at M&A or licensing deals, we'll look at all stages of development. And we, every year look at hundreds of companies and we look at the science. We look at the financials. And if they make sense, then we'll go ahead with that. With that it could be the Phase 1, it could be Phase II, but it could also be a Phase III ready assets, so we're open to all kinds of assets as long as they make sense financially and scientifically. Over to you, Alan.
Yes, thanks. Well, Sachin. And I think we know each other for a long time and I cannot give any guidance 2024, that's pretty clear. But having said this, I think the underlying growth is quite impressive. I think that's pretty clear. When you look at the Pharma side and it's really, really coming really broadly from a lot of products. You make a good point about a couple of them. I think some might be a little bit weaker, but others will be a little bit stronger. Let's see how it plays out. For me it's important 2023 we shouldn't forget about the Ronapreve impact in Q4 that we don't forget about this year. But I think really looks promising for 2024 and you know I'm enthusiastic about MET and Diagnostics, I think that looks good, I think he always explained this underlying numbers and they look great as well. And he has even more technologies to come. They might not play the major role in 2024, but certainly for the distant future. So I think really that looks fine.
Very good. And with that we would move on, the next two questions come from Matthew Weston, Credit Suisse or now with UBS, I have to say. Matthew, please.
Thank you. Can you hear me, Bruno?
Yes, sure.
So two product questions for me, please. The first is on Hemlibra. So US growth momentum in particular slowed and we are obviously seeing ALTUVIIIO launch and add a new treatment option in the category. Sanofi management has made some statements that they're seeing patient switches of Hemlibra. I'd love your perspective as to the market dynamics and how you expect that to play out going into the second half and into '24. And the second is around Vabysmo and what is clearly a spectacular launch and Teresa used the word momentum, but if you actually look at quarterly incremental absolute dollars then 2Q actually was less of an incremental add over 1Q versus the same quarter previously and that seems quite odd this early in the launch and Japan looks relatively stagnant with Q2 pretty much flat over Q1 and Q4. So I just wondered whether there was anything unusual about Q2 and whether we should expect some acceleration going into the second half of the year and I realize I'm being picky, so I want to make that clear. But getting Vabysmo right is clearly quite critical.
Matthew, I appreciate you acknowledging your pickiness, but I think both of your questions are super valid. A question about the sales in both sort of the sales cadence, if you will, for both Hemlibra and Vabysmo comes a little bit down to buying pattern. Q2 is always a little bit funky when it comes to buying pattern. And I think that's a reason that you may see that the difference that you see in the Hemlibra and Vabysmo shares, their sales there. Again I think when we look at when we look at market shares, the US market share is growing quite significantly. We're at 50% now in nAMD, 9% in DME. We have greater than one year real world data. More than 1 billion doses in market. I mean, I think we've just got tremendous again momentum here, but I think as always when you have products that are and I'm speaking specifically to Vabysmo here now that have contracts associated with them. You always can sometimes see a little bit of quarterly fluctuation. When it comes to ALTUVIIIO, I mean honestly right now we're not hearing about switches, there's really no reason for a patient on Hemlibra to switch. They're very well controlled from a disease perspective, they are highly satisfied. They are in many cases and 2/3 of the cases already on an every other week or monthly dose. So there's very little incentive for a patient on Hemlibra who is well controlled to switch. So I mean it's just, it's not something we're hearing a ton about actually in the market, to be honest.
Many thanks.
Thanks, Matthew.
Okay. And we go on, next one would be Mark Purcell from Morgan Stanley. Mark?
Yes, thank you very much. Bruno. Good morning, good afternoon, everyone. So two questions, firstly on Polivy the update. It seems to be stronger than you anticipated and obviously competitors now going to use Polivy in NFS on trial. So is there upside to the $2 billion peak sales target you gave on this product. And can you help us just at this stage, think about sales aspirations for Columvi and for Lunsumio as well. Obviously, it's a combination of Polivy and Lunsumio. So it's quite difficult for us to model. Secondly, in terms of Ocrevus sub-Q. Could you sort of help us understand what's going on here as well because Briumvi uptake has been pretty strong based on obviously shorter infusion time. So when you think about Ocrevus in a syringe pump followed by Ocrevus in a patch pump, can you help us understand the administration times of both the ease of at home usage with both presumably patch pump is a lot easier. And then can you confirm whether the patch pump would be a Part D medicine as opposed to just Part B? thank you.
Okay. So in terms of Polivy. I think we are seeing great uptake. I'm not sure I would say that it's stronger than we anticipated, because I think I can sort of remember being back on the stage, number of years ago when the data first came out and us thinking this will be the standard of care. I mean, that incremental benefit over a highly effective standard of care in our mind, I think, was it was a game changer in first-line DLBCL which we know when patients relapse their outcomes are much worse. So upside to 2 billion, I would say I'm still feeling pretty good about the 2 billion. I mean I feel like we need to get there, but based on the fact that we're seeing uptake in all IPI statuses and we are seeing rapid adoption, it's possible that there may be upside here. And again I think we're seeing quite a bit of really exciting uptake with Polivy. When it comes to Columvi and Lunsumio. I mean I think it's important to remember that both of them right now are in relatively small patient populations. So both third line plus DLBCL for Columvi and third line plus follicular lymphoma for Lunsumio, these are relatively small patient populations. But as we move into bigger and bigger patient population, I think these both have quite significant potential and may in fact be a little bit undervalued by the market. So again maybe something to take a look at, particularly when you look at the profile of these drugs. Sorry, Bruno, I know I'm not being crisp in my answer, but for Columvi that fast deep durable response rate in a fixed-dose therapy with your visits to the clinic,. that's an incredibly attractive profile. And then when you think about Lunsumio it has a profile that is sort of perfectly designed for the chronic populations in which it’s looking at. So more to come there.
In terms of Ocrevus sub-cut, so I mean, we're talking about going from an hour’s infusion to a twice a year, 10 minutes sub-cut. I mean, that's pretty good. And I would suspect that this will be quite competitive in the market. To be honest with you, I know we've heard this Briumvi is having a great launch, honestly we don't see it, we just don't see it or hear it in the market in the same way that we hear it reflected back at us. I think in a lot of instances, the numbers that are being cited frankly are coming from survey data and survey data is never as accurate as actually sales data. So the way we kind of look at the MS market at the moment is exactly what we had hoped would happen is happening. The high efficacy anti-CD20 market is expanding. It's now over 60%. This is of the MS patient population. This is what MS patients deserve, the best possible chance to control their disease. And we still see Ocrevus having the lion's share of that and we think that we have an opportunity to actually continue to expand our lead with the advent of sub-cut.
And the expansion into Part D, could you help us to understand that Teresa?
So I think with Part D or Part B I think it's a little hard to say at the moment because it could either be in the office or at home and so I think more to come on that more details closer to launch.
Thank you.
Thanks, Teresa for you crisp answers. I think also if my counting was right, it's actually three questions. So I would ask the next one here in the row. Michael, please stick to two questions. Michael, please. Michael Leuchten from UBS.
Thanks. Bruno. Yeah, I'll stick to two. So two questions. I think for Teresa just your comment about Polivy and first-line DLBCL trials now requiring a Polivy option in it, how does Roche deal with that. Do you facilitate that or is that effectively a locking option you have to not allow others to maybe run these trials are not run as quickly as otherwise secured and a clarification on Ocrevus subcu does that, does it require nurse resources with it and does it require a sort of an infusion to share or is it completely removed from the infrastructure that would normally see with Ocrevus IV. Thank you.
Great question. So on the first one we would never do that. We would, we would never do that. So if someone wanted to use Polivy for a competitive trial that's very common in the industry, we make, we make our drug available for competitive trials, all the time. It is worth noting, however that first-line DLBCL trials are long and they are relatively large. And so we believe we have a four to five year. We have a four to five year lead time for anybody that would potentially want to come in to the first-line DLBCL space. So we think we've got a really, really good place for sort of Polivy to really entrench itself. In terms of Ocrevus sub-cut with the initial syringe pump that is either in the clinic or in the office that does require a healthcare professional first. So it would require a nurse physician and a pharmacist GP healthcare professional is required and an IV chair, but that is something that will be hopefully in the second generation with the patch pump will be something that will no longer be required.
Thank you.
Maybe Teresa here's one question coming in by email. It's from Edison Lazardi and it's about goes to Ocrevus as well. Could you elaborate on your commercial strategy for the subcu Ocrevus. And I guess thinking this will expand the market. From our perspective through competition with competitors subcutaneous products or other IV CD20. So how do we see the market developing once we launch?
So I think for sure we will see some patients who are on Ocrevus switch to the different formulation. I think we will see patients who are currently on other anti-CD20 subcu switch to this one, I think we will see naive patients switched to Ocrevus sub-cut and I honestly sincerely hope that more MS patients will get on a high efficacy therapy over time. This is the best possible option that we have for MS patients right now to control progression to control relapses and so I believe that Ocrevus sub-cut given the breadth of the efficacy data, the breadth of the safety data, the convenience that we already supply within every six months infusion. Now moving to and every 10 every 6 months 10 minute injection. I sincerely hope that more patients of all types will go on this therapy because it is their best possible chance to live their fullest life.
Thank you. So next two questions would come from Richard Vosser. Richard, please.
Thanks, Bruno. Two questions, please. First one on Tecentriq, just thinking about the outlook going forward really, could you give us an idea of the penetration in liver and lung and small-cell lung cancer and how the rollout is going in adjuvant lung and on the basis of that, how do you see the outlook going forward for the product and then a follow-up on Vabysmo obviously high dose EYLEA has been delayed what incremental warehouse patients do you think you can capture, because of that delay. Thanks very much.
Great questions. So Tecentriq has done a great job of penetrating the indications in which it has which has differential efficacy so indications like small cell, we are largely penetrated. When we look at HCC, I think there are parts of the world in which we are getting relatively fully penetrated. But there are actually other countries that we have not even yet launched are still awaiting reimbursement. And so we would still expect some growth in HCC, I'm currently in adjuvant non-small cell. We still have about 40% or 50% share of this is enough market leadership. This is relatively, a relatively new market, we would expect that we will continue to retain share here. We have very compelling data, particularly in the PDL1 high patients where we see and hear very positive feedback from the physicians who use it, but I think we do have to acknowledge that there is competition in the space. So I think this year, we would continue to expect Tecentriq to deliver double-digit growth and we do continue to believe that it has, it has the ability to continue to grow. I wouldn't underestimate the impact of something like to Tecentriq sub-cut. Again, the ability to do what we saw with Phesgo particularly in more resource constrained healthcare system. It has the opportunity again from a 30 to 60 minute infusion to a 7 minute injection really has the opportunity I think to capture some more market in that way. So wouldn't certainly wouldn't count Tecentriq out by any stretch. In terms of Vabysmo. So I think there hasn't been this question of where people warehousing patients waiting for high-dose EYLEA. I think our impression in talking to retinal specialists that may have been happening in some pockets, but certainly not any sort of massive way. We are hearing that those physicians saying, well, there's really no reason to why would I wait when I have a great option right now with Vabysmo and I think it just gives us the opportunity to continue to make sure that as many retinal specialists as possible are getting experience with Vabysmo that they're getting patients on that, they're seeing that the benefits and that they're having the opportunity to expand it in their practice. And I think that we will take the advantage of every opportunity to make that happen, because we believe it's in the best interest of patients.
Thanks.
Next one would be, Richard does this answer your questions?
Yeah, absolutely, fine. So I was just muting.
Then let's move onto. The next one would be Richard Parkes from BNP Paribas. Richard?
Hi. Thanks, Bruno. Yeah, just two questions. Firstly, the partnership with Alnylam in hypertension obviously represents departure in terms of therapeutic focus. So I just wondered if you could walk us through your thinking there and criteria required for new programs that would warrant an expansion in terms of commercial presence and maybe from a business development perspective, what are the new areas. Might you consider as potential opportunities. Then the second question was on brain shuttle gantenerumab. I think you mentioned dates through CTAD. I just wonder if that we should, should we see that as just a proof of concept for the platform or do you think that's an asset that you could think about taking forward. I had the impression in the past you might prefer to maybe focus under the amyloid targeting antibodies, if you chose to progressing Alzheimer's. Thanks.
Yes, thank you very much, Richard, for the questions. And now I'll take those two questions, first, if you look at, Ocrevus, we were not in multiple sclerosis before we launched, Ocrevus, and we redefine the standard of care. If you look at Evrysdi we were not a spinal muscular atrophy before we launched Evrysdi we redefine standard of care. If you look at Hemlibra we were not in Hemophilia before we launched it and we define the standard of care. I think what's important for us and that our key focus. We want to find first-in-class, best indices transformation medicines, when you have an opportunity to deliver transformational medicines. I think that's the opportunities that we are looking for. And clearly with this medicine that is the case. It's a very proven pathway. You've seen from Teresa the data with more than 90% decrease of this protein angiotensinogen and a sustained response for six months. When you know that 1.2 billion people in the world and 80% of them not being controlled. You can see that there is a big opportunity with a transformational medicine. So we are looking for these opportunities that are interesting, there are also big opportunities really opportunities where we can change the standard of care. And we think this is one of them. And so we're looking at that in different areas. Regarding trontinemab, we have data. So this is basically a brain shuttle version of the antibody connected to brain shuttle. And we all have this blood-brain barrier. And the reason why we have the blood-brain barrier is because our brain is important and you know a body tries to protect it. And with that is very hard to bring antibodies into the brain. Now, we have seen data where we can see that it's much better, much faster, much higher dose although you submit much smaller dose, it's much easier to get it into the brain and much more homogenous way. So we see that as a big opportunity and we will be very growing very fast with this molecule. And so we will share more data at CTAD. But it's very exciting for us.
Thank you.
Richard, all your questions answered then.
Yes, thank you.
And we will move on to questions from Peter Welford from Jefferies. Peter?
Hi, thanks for taking my questions. I have two and firstly for Alan I think just on the margin constantly coming defending the margin, but I guess if we take out the Ultomiris you said actually in the first half of the year. You delivered underlying margin expansion. I guess we think about the second half and think about the phasing there. But then we think about the reiterated outlook for EPS, what are the sort of headwinds, we should be thinking in the second half of the year for the margin that resulted in some mitigation perhaps and the conservatism as to why you still see EPS growth to be broadly in line with sales for this year, if you could just sort of talk us through that. And then secondly on Diagnostics or I guess it's sort of strategy to some extent. And just looking at the various elements of Diagnostics particularly diabetes. But I think you made the comment, it was decreasing and that decrease is likely to continue for the foreseeable future. Curious other elements within diagnostics such that there could be considered non-core and the scenario Roche really needs to be in, perhaps you could talk about, are there areas within Diagnostics that perhaps are potentially not and don't have synergy with the Pharma business? Thank you.
Alan?
Yeah, I think, look we come up now with a lot of things and certainly headwinds that we could face, but feel good. We are well positioned. I think cost discipline that's the major point that we have to apply in the second half, but the organization is aware, I think our plan stands and I think if we follow that plan, I think will come in within the guidance that we have in mind that we have placed in the market. So it's not like that I see specific headwinds are coming up in the second half. Okay. We can always mentioned inflation whatever about asset. I think that's something we deal with and that we will manage. No, we feel good about the guidance once again for the full year.
I'll maybe touch on the Diagnostics portion so. Yes we see this decrease in Diabetes Care, but what I'd say is similar to what I've said in the Q1 call is we are also continuing to look into continuous glucose monitoring and diabetes care is a key part of our overall strategy. Diabetes is a major health burden worldwide and it represents attractive market for us to be in and we will continue to be there first part. Second part to the comment about are there areas within our portfolio that are not delivering value. I mean we are constantly looking at our portfolio and I think we're really happy with our overall market leadership and strong portfolio we have. So now there any areas that we're currently looking on exiting.
Very good. Next two questions would come from Simon Baker from Redburn.
Thank you. Bruno. Thanks for taking the questions. Two if I may please, both on two of the newer products. So firstly on zilebesiran. The appeal of a superior product dosed far less frequently than a cheap ineffective or tablet is clearly very appealing, but is your neighbors have found from a commercial point of view, certainly in cholesterol management. It can be challenging. So I'm just wondering if you could talk us through the, not the clinical risk on zilebesiran but the commercial risks going forward. I know it's early, but I thought I would ask it nonetheless. And then moving onto KSQ-4279. I just wondered what your, if you have rights to an interest in non-oncology indications because USP1 has been implicated in a number of cardiometabolic indications. Is that something that you're interested in, and do you have the ability to exploit that? Thanks so much.
I'm going to start with the first open. Go for it.
I can take that. So first of all, I want to congratulate you on the pronunciation. It's not the easiest one. But jokes aside. So one of the things that is very different to the other medicines that you mentioned which actually target the same target as the medicines that are available. This actually targets a very different mechanism, it's really talking at the start of the cascade. And with that you don't have these compensating mechanisms. But you really hit at the very top of the pathway and you hit it specifically in the liver where you need to hit it versus the other medicines they basically all your body. So we see it definitely very different mechanism of action. And with that we do believe that there's a significant opportunity to really change also the effectiveness of these medicines. On top of that, if you have to take it subcu only two times a year. So every six months. The point is that you cannot take the tablets during the night. So you have pretty sustained lowering of blood pressure and that we think we have the right impact. Regarding KSQ and USP1 so we license in because of the oncology indications, but thanks for the heads up. So we will have a discussion on that, but that's not what we had planned to be direct. Do you want to add anything?
So I think the only other maybe thing to add on zilebesiran is that one of the I think big differences is that we do sort of expect that we will need cardiovascular outcomes at launch, and that that is an important thing that we will, we will need to come to the market with an order to have sort of the ability to effects the most number of patients possible. So I think that's very much on our minds on that.
Thank you very much.
Okay. Next one would be Andrew Baum from Citi. Andrew?
Thank you. Couple of questions. So first on zilebesiran cardiovascular outcome trials lengthy and expensive. So within your modeling. I'm just curious, what are your assumptions for the IRA in terms of how long you last before price negotiation happened, it's currently 9, the new modeling 13. And then second, potentially by the time this comes to market. You may have lots of patients on Latvia, are you confident you can selectively reversed zilebesiran better without impacting LEQVIO if patients are co-medicated. And then just one word answer. Could you just tell us when autologous CAR T-cells are going to enter the clinic for autoimmune disease. Allogeneic and I probably just apologies.
Okay, great. I didn't catch that one, sure. So for the IRA assumptions and exactly what our development program would look like particularly in the Phase III. I think that's something that we'll be able to share with you in the future. Right now the deal the deals about a week old. So certainly, we've given the some thought, but I think this is something that it would be more appropriate to discuss in the future in terms of do we believe that you would need to be reversible, and how would you how would you think about that for patients who are on concomitant medications. Again it's something that I know that we have been thinking about, but that's another something that I think as we get further into thinking about what the ultimate Phase III trials would look like we could share more details with you in terms of CAR T-cells and auto-immune diseases. Yes, we have thought about this very early in research, no timelines, yeah.
Andrew did we answer all your questions.
Yes that's fine, thank you.
And then go on next one would be Emily Field from Barclays.
Hi. Thanks for taking my questions. First one just kind of a little bit differently. There was a deceleration growth in the US this quarter and I was wondering if you could provide a little bit, of incremental color around that. And then also, should we expect that the driver to get to double-digit growth, both this year and the year ahead, would be primarily coming from outside of the US and then Lunsumio and Columvi, do you have an update on the subcutaneous formulations for both. And just any indication of when could see first line study given that that would be the most significant commercial opportunity. Thank you.
Okay. So if, if I understood your question correctly. Sorry, you were breaking up a little bit, it's a deceleration of growth overall in the US in the beginning in the first half is that?
More just asking sort of is the primary driver to get to center, double-digit growth going forward, going to the Ex-US?
Yes. So, yes. So when you continue to think about where sort of the bolus of patients are who are not yet on Tecentriq, but could be on Tecentriq those will largely be coming from outside the US. We would expect that we will be able to maintain the patient share that we have in the US, but again the growth -- the growth will come from outside the US, and then in terms of the bispecific subcu formulations both have subcu formulations and process. Lunsumio was a little further ahead. We expect to have data about that next year. And I think I'm not sure that we've disclosed data timelines for the sub-cut no.
We have not disclosed timelines. But we have disclosed that we have development programs ongoing.
Okay. Thank you.
There was another question. Teresa. I think our next development steps in first-line DLBCL. But I think we already have been communicating and should get an update, I think soon. I think since we have now a new standard of care established in first-line DLBCL. We have the bispecific moving into second-line setting, which I just don't know study or fabulous studies I think the obvious next step is that you also get an update on what combinations we will test in first-line perfect and wasn't very all questions mean be this one now.
Perfect, thank you.
Okay. We go on next one would be Luisa Hector from Berenberg.
Thank you, Bruno. I wanted to go back to the Alnylam collaboration, please. I wondered how much incremental data you've seen through your due diligence whether you've seen any Phase 2 at this stage. And just a comment around how much safety data is in hand. But number of patients duration that would allow a fairly fast move into Phase III from this point. And then perhaps a question on then any comments you can make on the burden of the potential development milestones and whether the deal washes its face in this high-risk, high-potential hypotension subgroup alone? Thank you.
No, we haven't seen any Phase II data, the Phase IIs are currently ongoing they're blinded we clearly haven't seen any the safety data that we've seen is it is largely from the preclinical and Phase 1 data that would have been available as those trials had already read out. In terms of the burden of and so far it looks quite clean actually in terms of the burden of development milestones. I have to say I have not heard does it wash its face before. That's a new one. So I assume that means do we do. We believe that it will pay for itself. And I think we absolutely do again this is an extremely large market. I mean we've been talking about the sort of 1.2 billion people who have hypertension, the 80% who are uncontrolled. But if you want to get really specific about the number of people who are actually not only uncontrolled that increased risk for bad cardiovascular outcomes and you only want to look at the EU5 in the US that's still 20 million people. And so even if you just look at sort of highest risk people on a relatively small number of countries. I think you can see that there is potentially a very large and high need market that actually isn't being served by the current standards of care and so the development, the development milestones. The cost development that's sort of all been factored into our thinking because we just do believe that this could be not only a transformative molecule for patients, but clearly a multibillion-dollar opportunity at peak.
And maybe just to add. So the upfront milestone. I think it was around 310 million and to get the end of the Phase II we have maybe another 585 million. So we have 585 million potential investment for then hopefully Phase III ready asset. So I think from a deal perspective that's pretty good and well derisked and again I just want to highlight that this is a proven pathway and so talking to our sciences. We're looking at the data that we've seen, we believe very much in this Molecule and that's why we've done this deal and I think it's pretty well de-risked from a cost perspective And maybe Luisa also add on, from my side. I think there wasn't IR call by our partner company and where they basically outlines the development programs are the next steps KARDIA-1 and 2, the studies to read out soon in the second half early 2024 and we have free and the parameters, the study is looking at them basically determines the Phase III development program and this is only the core indication, but I think over time. But I think over time there are of course additional indications for example heart failure and other opportunities, which can be put on the time. Absolutely. So just maybe something to look up, I don't know Luisa did we cover your, did we answer your questions.
Yeah, I think just on the number of patients in Phase II and the duration of dosing. Just from that regulatory perspective based on how it sounds today you're confident you should be able to move into Phase III pretty quickly from here.
The Phase II are quite well, Phase 1,600 patients. The other 300 plus patients, the duration is sufficient they're well-designed studies.
There is the KARDIA free study in between, which will start soon and this has been the study, which will inform the pivotal Phase III.
Great. We haven't actually talked about KARDIA-3 but KARDIA-3 is the third Phase II. It is for patients who are on who are uncontrolled on to standards of care. So it's really your patients who are higher at highest risk report cardiovascular outcome.
Yeah, collect combination data.
Exactly.
Thank you.
Okay. And then let's move, the next one on the row would be Holger Blum.
Holger Blum from Patinex Management. I'd like to get some more color on the development of the diagnostics divisions over the last four years. If I look at your Q2 2023 Diagnostics sales number, it seems 6% below the level of Q2 2019. It should be a clean pre-COVID comparison base. In most quarters you repair ordered healthy underlying growth of your core diagnostics business. And if I do the math the growth rate of the base diagnostics business. It would be nearly $1 billion higher for Q2 revenues in Diagnostics, currency, it could be an explanation, but it's still doesn't get better which seems pretty big within the healthy growth in the underlying and the reported numbers.
Holger, maybe I'd just quickly jump in. I think this is a bit difficult to answer. I think we would really have to look at the numbers and we are happy to assist you hear if you come back to us and then we can then we can have a look.
I mean I can clearly say at constantly change rates. I think our growth rate was between 5% to 7% on average, sometimes in double-digit over the last couple of years. So let's look into that but there seems to be something wrong in that analysis perhaps currency, currency is a fair point.
Okay. Thank you.
Okay. Then we move on with Eric Le Berrigaud from Stifel. Eric, are you still on the line? Doesn't look like. So I think then we can move on and have next one Rajesh Kumar from HSBC.
Hi, there. Thank you for taking the question. Just one follow-up on the capital allocation on M&A, which at the beginning of the Q&A, you said that you are open to all areas of assets early to late stages. And then on serum hypertension partnership. You said that you're going to start with some indications and then expand into other in the future. And then with the IRA around the corner could you run us through how you're thinking regarding capital allocation on deal making have changed. And second, would be in terms of product development cycle do you think it's a logical way still to go, you develop one indication and then add other indications later on, or do you think you need to move a more parallel so that you can tap into a bit more of pre-negotiation period earnings from the products. I think this question is basically about capital allocation, big picture.
So the first thing, When we look at internal programs and we look at external programs. When we do our NPV calculations, we include all aspects of IRA, so when we make decisions whether not invest in internal program or an excellent program we take those things into consideration clearly on external programs. As mentioned before, it has to make sense scientifically but also financially and so we'll have a strong financial discipline from that side. Anything that you'd like to add, Alan, on that one?
No. I think that descripts it as well. I think there is nothing to add here.
And the second thing, just, I mean we are really looking at our product development from early stage late-stage end-to-end. We are looking at ways and how we can accelerate on product development. I mean, just one. One example of something that we're doing is, we're actually developing our own internal large language model. ChatGPT just Roche owns ChatGPT, so we can really accelerate a number of things within our organization. It's just one of those examples. So there are opportunities to accelerate our product development also in other areas using artificial intelligence, but we do that also irrespective of the IRA, we always want to aim to be faster.
Yes, Thomas. Alan. And then I think we have a final question, which comes from Sachin Jain. So Sachin you have opened the row and you closed the row. Back to you. One question.
Thank you very much for fitting me just two very quick product questions. One on your TIGIT slide where you listen news flow SKY-06 isn't listed as a 24 events ct.gov has primary completion in May 24, so just wanted to check whether we should think about SKY-06 which is the chemo combo study next year and then the second question is just back to ALTUVIIIO the initial base count you were fairly vocal that the study design was potentially selecting patients for low risk of inhibitors. Just wondering if you've seen that play out in real life i.e are you seeing LTV patients developing inhibitors, which impacts the competitive landscape. Thank you.
Great. It's somewhat serendipitous that you've got the opportunity to open and close, because then, I'll get the opportunity to give you my standard tigit answer which is that we actually, we have not actually disclosed the readout date for the chemo combo study for competitive reasons. So more to come on that, but that isn't actually something that we have disclosed.
It's on ct.gov, Teresa.
I don't know that we have actually confirm that and oftentimes, things up on clinicaltrials.gov. And in terms of ALTUVIIIO., I mean I think it would be inappropriate for me to comment on the safety of another product, but I would say that our concerns about the trial design hold they specifically designed to trial to limit patients or to screen out patients who were more prone to developing inhibitors and so logic would conclude that you might see something different in the real world. But it would be quite inappropriate for me to comment on what has happened with their patients.
Thank you.
Very good. I think with that we're done and close the Q&A session. And if there are any remaining questions then of course please reach out to us anytime. We are happy to assist you. And look for the answers and hope to talk to you soon. Bye.
Thank you. Bye.
Bye-Bye.