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Antje Witte: Good afternoon, good morning, good evening. Welcome to the UCB Half Year 2025 Capital Market Call. My name is Antje, I'm the Head of Investor Relations at UCB. Before I introduce you to the agenda and hand over to the speakers today, I'd like to make some remarks. This presentation and the following Q&A session are intended for institutional capital market participants. If you're not, please disconnect now. This video conference is being recorded. You can find the presentation in our download center on our website in the Investor Relations section, of course, if you dial in by phone. And this presentation and the following Q&A session are covered by the disclaimer and safe harbor statement as stated on the Slide 2 of the slide deck. Please kindly read and respect this carefully. With this, I'd like to introduce you to our speakers today, our CEO, Jean-Christophe Tellier; Fiona du Monceau, Head of Patient Evidence; Emmanuel Caeymaex, Chief Commercial Officer; and of course, CFO, Sandrine Dufour. And then we're going to have a Q&A session with our speakers. With this, Jean-Christophe, over to you.
Jean-Christophe Tellier: Thank you, Antje. And from my side also, good morning, good evening, good afternoon, everyone, and thank you for joining the call. It's a pleasure to have you here and to share with you what have been pretty extraordinary first half of the year for UCB in 2025. So we are happy to share with you the strong results of this first half of the year, which are supported by an unprecedented growth, which illustrates the focus on the strategy based on innovation and delivery. So on this slide, you can see on the left-hand side, a summary of what this strategy means this patient value strategy. It means for us that we try to better connect the patient to science, thanks to a better understanding of pathway biology and then we connect this science to a solution and engineer a solution, thanks to our technical platform. And this leads us to get differentiated products that we are better than others able to validate the data with our 86% of successful rate of Phase III. And thanks to that, we can deliver this differentiated solution to the different markets where we have a significant impact. Last year, when I described the half year results, if you may remember, we presented a growth of plus 13%, and it was at that time, the start of the decade proof of growth. The best way to continue to engage into this decade of growth is to accelerate the growth, of course. And you can see here that we have moved up from 13% last year at this period of the year to a plus 26%. Sandrine, Emmanuel will comment in more details the financial -- the detailed number. But just to give you one number, our 5 growth drivers have realized this first half of the year more than 2.5 twice the revenue of last year, which is very promising. And of course, we have also had a strong delivery on the pipeline of which Fiona will comment. Next slide, please. So as I told you, this unprecedented growth is the consequences of the strategy, but it's also for us an ability to continue to invest in our future. Invest in our future first by an investment in the pipeline. You see here our engagements already to 4 additional indication for BIMZELX and 2 for FINTEPLA. Engagements and investments in the future based also on expanding our manufacturing footprint with the recent announcement that we shared with you on U.S. greenfield investment for $2 billion of direct investment and up to 5 billion of economical impact. And also, of course, we are investing in our capabilities in order to provide the complete and as much as possible accelerated service to the patients that we serve. And it's to access, and we are pleased to have expanded our access, and you can see the result of this expansion of the access with the numbers of patients of BIMZELX compared to competitors. So yes, definitely, a first half of the year that illustrates the strategy, the good execution of the strategy and the impact that we have on the marketplace. And with that, I would like to thank you, and I will hand it over to Fiona.
Fiona du Monceau: Thank you very much, Jean-Christophe. Good morning, good afternoon, good evening. I'm delighted to give you an update on the progress of our pipeline. And I hope you'll see that UCB really committed on investing in differentiated innovation that truly makes a difference to patients and that fuels the future growth of UCB. Let me show you on the next slide how we're delivering on that innovation and continuously enriching our pipeline. Let's start with the news for 2025. So first, doxecitine and doxribtimine or [ DXM ], to make it simple. This is a treatment for TK2 deficiency disorder an ultra-rare mitochondrial disease. So where the muscles are not getting enough energy, which means that it's difficult to walk, to eat, to drink, to breathe. We shown a above 90% survival rates. And as you know, we submitted in the U.S. and in Europe, and we expect by end of the year. Next, Fenfluramine or FINTEPLA. We've recently received excellent results for our Phase III trial in CDKL5 deficiency disorder. This is the third developmental and epileptic encephalopathies where FINTEPLA yet again shows great results. And as an investigator was sharing recently, it's extremely gratified to see the impact of the reduction in seizure. Then bepranemab, our anti-tau antibody. We all have someone close to us in our family or friends families that are suffering from Alzheimer's disease. As you know, we've had some encouraging results in our Phase IIa in a predefined subpopulation. We're engaging with authorities and defining our next steps. Now let's move to the middle, where we have our multi-specific antibodies with galvokimig first and some of you will have seen a redacted mandatory submission that we had on the EU clinical trial of registry, where we've shown some great results. But please stay tuned, you'll have the full story at the EADV in September in Paris, and we are moving to a Phase IIb. Donzakimig, IL-15, IL-22, is progressing as planned, and we will have the results by the end of the year. And then most recently, as we've shared with you, glovadalen, our small molecule for Parkinson's disease, where we've had some positive Phase IIa and are assessing the next steps. All programs for 2026 and beyond are progressing as planned. So now let me pause and focus on BIMZELX. I will first provide you an update with our ongoing pediatric studies and then share with you the exciting news about the new indication we're pursuing. Palmoplantar pustulosis or PPP with our [ BC ] in Phase III global trial. So on the next slide, as you know, at UCB, we're committed to every patient. We've got numerous pediatric studies ongoing but today, I will focus on the 3 central ones, BIMZELX. So first, [ upsorisis ] study, this is a head-to-head. And it's important to note that 1 out of 3 patients psoriasis patients are under the age of 18. Next, [ Hindradenitis Superativa ], or HS. Again, here, 1 out of 3 patients are under the age of 18. And in addition to that, a lot of patients to whom I've talked to have their first symptoms during their puberty but unfortunately, it takes many years before they're then finally diagnosed. With the increased awareness of the disease, and the availability of treatments like BIMZELX, we hope to really close that gap. And finally, [ in idiopathic ] arthritis study. All 3 of these studies are enrolling as we speak. And now on the next slide for the exciting news, our commitment to palmoplantar pustulosis. As you can see in the top 3 images and hear from the name, this is a chronic skin disease that impacts the palms and the soles. As you can see from the pictures, you've got pustules that cover the hands and the feet. These are extremely painful, itchy and prone to cracking. I was speaking with a patient last week, and he shared that it was a little bit like having 100 paper cuts on your hands and in your feet. So you can imagine how painful that must be and how many simple tasks that we do every day are extremely difficult. They're carrying your shopping bags, greeting someone, walking around. Unfortunately, we lack approved treatments in Europe and in the U.S. and there are no established standards of care, and we hope to change that. In a small study, [ Professor Pacira ] has shown that 17 out of his 21 patients have achieved complete skin clearance and this quite rapidly within 1 to 4 months. So we really we show the strong results BIMZELX has had across multiple indications with the fast, deep and doable impact. I hope you can see that at UCB, we're committed to making a difference to patients with truly differentiated products and that we're looking to fuel that future pipeline. On that note, I'm going to hand over to Emmanuel, he will share with you the exciting impact that he's having in the markets.
Emmanuel Caeymaex: Thank you, Fiona, and hello, everyone. Delighted to be with you today. As you know, UCB has been launching many medicines, and so we've had a particularly high intensity of launches over the last few years and a launch is a process. It's not a single moment in time. So today, it's my delight to update you as to the results of the many launches both products and indications that have taken place. And obviously, as Chief Commercial Officer, it's my responsibility to ensure that those launches are successful. So let's have a quick look at this. We'll focus most of the time on BIMZELX because I hear that, that is where you probably have the highest interest and number of questions. So if we look at BIMZELX in the first half on the next slide, you will see that we have broadened and deepened the reach of the product globally. We now are touching 82,000 patients as we speak, in 50 different countries. And the sales amounted to EUR 800 million over the first half of the year. But of course, it is a significant increase to both first half last year and second half last year. And that's been driven by, I would say, predominantly 2 factors: the first one is the very successful launch of the new indications, in particular, hidradenitis suppurativa, now amounting to 21% of our first half sales, but also the rheumatology indications which launched a little earlier and for which the international and European contribution really starts counting. Psoriasis field themselves grew by a factor of about almost 2.5. So successful broadening as well of our psoriasis business. The second factor relates to a fast and extensive conversion to paid scripts in the U.S. And this was always an important variable last year. And I'm delighted to say that in the first half of this year, we've seen a continuous improvement month after month to rates that are really very, very competitive and are getting the latest benchmarks. And what underpins that is, first of all, the fact that BIMZELX is widely available on formularies in the U.S. as Jean-Christophe mentioned for greater than 70% of commercial lives with many lives in single step or better. But also 9 out 10 Medicaid patients and more than 6 out of 10 Medicare patients have access to BIMZELX in the U.S. And that is not just in psoriasis, but also in the indications that were approved between September and November last year by the U.S. FDA. The other reason that underpins this is the fact that our patient onboarding and support programs really have performed in a superb way and the bridge and the specialty pharmacy metrics look very, very good, which means that typically, patients move quite quickly from bridge to paid. And we've been quite effective in ensuring that this continues to happen as our indication expansion took place. And so with that, the April dynamic market share in psoriasis topped 35% in the IL-17 segment. We are very proud about that, and we're also very proud about the fact that we're already at 20% dynamic market share in rheumatology. And remember, it's just after 6 months of commercial launch in the U.S. What we're seeing is that BIMZELX is being adopted at a very high rate by the top 1,000 or [ 100 ] rheumatologists and dermatologists in the U.S. and clearly, at a faster rate than what's been seen before with [ R17 ] inhibitors. In addition, our DTC efforts are paying off and currently, we are beating the launch benchmarks by 2x in terms of our ability to generate incremental patients on the brand. Now in Europe, we are reporting what you would call TRx data here or patient share data. And so what we're seeing with this 21% psoriasis share within IL-17 is that as planned over a period of time of several years, the TRx for patient share is catching up with the dynamic share. And remember, the dynamic share was around 35% in Europe in IL-17 and so that 21% over time will move to that higher dynamic number. And likewise, if we look at the total biologics and oral markets, that share currently stands at 5% and is also set to increase, particularly as the persistence data that we continue to collect, both in Europe and the U.S. are really look very promising for BIMZELX and psoriasis. And I think we'll see the same or in fact, we do early days in the rheumatology indications. So then moving to the next slide. We'll focus on hidradenitis suppurativa because, of course, of all the indications it's the one that probably has represented the largest difference compared to your and our expectations for the first half of this year. And on the left panel, you can see a depiction of a campaign that we have put together really with patients anchored in patient insights to try to sensitize dermatologists to their lived experience and experience of pain and suffering, an experience of feeling stigmatized of isolation of shame and loss of dignity. And these campaigns won the most awards at the European first half of [ BM Society ] meeting in London across any industry [ Michel ] and marketing campaigns because it's really enables people to not only learn something, but it really changes someone's perspective and leads to different action. And we've seen with this, for example, that together with this campaign and the tools that we've put out to dermatologists, we've been able to increase diagnostic confidence by 40% in HS. And our goal is also to reduce the time to diagnosis, which currently stands at 10.3 years in Europe and at least that in the U.S. as well. So UCB is positioning itself as the company in hidradenitis suppurativa, and I believe that dermatologists looking at various surveys, including many that you are fielding clearly perceive BIMZELX as the best-in-disease product in HS. And so one we can see it translated in the dynamic patient shares in the biologic market, which essentially is adalimumab and HUMIRA, secukinumab and BIMZELX. And you can see here after 4 months of commercial launch, BIMZELX was achieving 26%. And if I look at the last point estimate, we're probably around 40% now in the U.S. In Germany, we're at similar kind of numbers and in Japan, where there's just 2 products approved, adalimumab and BIMZELX, we stand at 65%. So it's very promising. And I believe that we have a strong chance to lead and to capture that position in the near term which is even more important as the field is due to grow very significantly. And on the next slide, you see that we have about 1 million patients diagnosed in the world, most of them in the markets you see depicted here. And many of those patients, in fact, the majority are patients that would need a systemic treatment and a biologic in particular, given the severity of the disease, but also the value of treating early to prevent surgery and scars as well as the tremendous psychological anxiety, et cetera, that comes with this disease. We would see that about half of that eligible population is likely to be treated with a biologic within the next many years. So you take those left-hand side numbers, you multiply them by 30%, and that should give you a sense of where the market is heading. So in our estimation, and you just look here at the 5 large European markets, U.S. and Japan, we see a sustained CAGR and at least 175,000 patients on systemic biologic treatment or others by the end of the decade. So with this, let's have a look at some of our other launch brands. And you will see on the next slide that UCB has progressed very significantly in our capability to launch successfully in rare neurologic conditions. And first and foremost, in generalized Myasthenia Gravis RYSTIGGO and ZILBRYSQ contributed to more than -- to about EUR 240 million sales in this first half and FINTEPLA, more than EUR 200 million sales as well. I remind you that UCB is uniquely positioned in Myasthenia Gravis with a unique and differentiated portfolio of targeted medicine that will enable us to meet the diverse needs of patients, but also the evolution in the treatment dynamics, which are quite different from region to region where in the U.S., there's a clear preference for the [ anti-FcRn ] mode of action. I would say it's probably 70-30 now in terms of new patients whereas in the world, it's almost perfectly balanced between anti-FcRn and complement C5 inhibitors. If we look at FINTEPLA we now have more than 11,000 patients benefiting from the treatment. We started in Dravet syndrome, where FINTEPLA is a foundational treatment. Our market share in the U.S. is 19%. In Lennox-Gastaut, which is a more recent addition, and we're actually lacking targeted treatments. FINTEPLA has increased to 8% share, our sales increased by about 30%, both in the U.S. and worldwide as we significantly expanded access for FINTEPLA around the world. And so with that, I hope that you have understood a few reasons for the great results that we've just presented. And I'm going to ask Sandrine, who will take us through some more details into the financials.
Sandrine Dufour: Thank you, Emmanuel. Thank you, and thank you for these exceptional product launches that are driving our strong financial performance in the first half. So good morning, good afternoon, everyone. We first go through the drivers of the strong first half performance, and then I'll take you through what it means for the year with an upgraded guidance. And so starting on next page with net sales. Net sales were EUR 3.32 billion in the first half, 26% growth, clearly boosted by BIMZELX performance, but also a very nice double- to triple-digit growth for the other recently launched assets as well as BRIVIACT. Starting with BIMZELX. Net sales quadrupled to close to EUR 800 million with strong volume growth in all regions, all indications and outperformance of HS indications as well as effectiveness of access strategy in the U.S. translating in higher percentage of paid scripts. So Emmanuel also commented on FINTEPLA and RYSTIGGO and ZILBRYSQ performance and combined the 3 assets delivered close to EUR 200 million of net sales growth. EVENITY, net sales grew by 36% in Europe to EUR 63 million and as you know, Europe is now profitable, and it is adding to the EUR 282 million net contribution from our partners, which is booked in the other operating income, we see this in a minute when we comment on the next slide. And BRIVIACT, BRIVIACT continues to nicely grow by 15% and increased net sales to EUR 377 million. Last, CIMZIA. I'd like to highlight a few drivers on the first half performance of CIMZIA. CIMZIA remains the fastest growing branded TNF in all major markets and global volume grew by 7%. And part of this 7% volume growth demonstrates the brand resilience with CIMZIA differentiated clinical profile, whether it's in women of child-bearing needs or with the high rheumatic fatter. And part of this 7% as well is the result of some anticipated buying pattern in the U.S. that we expect will normalize and will not repeat in the second half. And in this first half as well, there were some favorable channel mix effects that should not repeat in the balance of the year. While on the other hand, we continue to see pricing pressure with the impact of [ IRA Part D ] redesign and the rising trend of 340B. So overall, that's why we saw only a modest decrease of 2% at constant rate in the first half. Now at the bottom of the page, you can see the progress in our sustainability journey as we continue to be rated in the ESG top leaders in our history. CDP, which is the Carbon Disclosure project, awarded UCB a level [ A-score ] on supplier engagement assessment, which demonstrates the efforts we do to manage the reduction of our Scope 3 CO2 emission impact. And also UCB was recognized by [ Time and Statista ] as one of the world's most sustainable companies, and the company maintained the #1 position of the biotech sector by Sustainalytics. So let's now look on the next page to the full P&L. All in all, the first half was a very good illustration of the meaningful margin expansion equation that we've been explaining for a while, with robust net sales growth leading to improved gross margin performance and operating leverage. And revenues achieved EUR 3.487 billion, a 25% increase, which is very close to the growth of the net sales that I have just commented. Adjusted gross profit was EUR 2.8 billion, a growth of [ 28% ] and adjusted gross margin improved by 2 percentage points from 77% to 79%. And the main driver of this margin expansion was the improved product mix as the key growth drivers come with a higher individual margin. Operating expenses totaled EUR 1.845 billion, it's a 15% increase which is now lower than net sales growth. And starting with marketing and selling expenses, they grew by 23% to EUR 1.165 billion reflecting the continued investments behind the global launches, but also higher fee for service expenses in the U.S. And this fee for services they are, for example, paid to the PBM or to the specialty pharmacies, they are directly linked to gross sales, and they will continue to expand as the franchises grow. The R&D expenses, they grew by 9% to EUR 860 million, reflecting the continued investment in the clinical pipeline in the earlier stage research activities and also digital initiatives where we are advancing the digitalization of research and development activities, and the R&D ratio reached 25% in the first half after 28% last year. We had lower G&A. They decreased by 7%, and with this last year, the accounting effect of DLTI and the one-off implementation costs of our new growth organization model did not reoccur. And the other operating income increased by 18% and this is largely driven by the net contribution of EVENITY, which went up by 24% to EUR 282 million. So all of this leads to an adjusted EBITDA of more than EUR 1 billion, EUR 1.033 billion to be precise, which went up significantly by 58% as a result of the strong revenue growth, the improved gross margin and the operating leverage. And the EBITDA margin increased by close to 700 basis points, reaching 29.6% and compared to a 23% in the first half of 2024. So moving to profit. Profit of the group amounted to EUR 475 million, more than doubling with us EUR 208 of last year. And the average effective tax rate was 20% compared to 16% in June 2024. The increase in tax rate is mainly driven by the strong business performance, the tax impact of an internal reorganization and also the international minimum tax. And all of these effects are partially offset by the continued use of the R&D incentives. Finally, core EPS, EUR 3.53 per share, compared to EUR 2.09 last year, it's a growth of 69%. So in summary, the first half of file highlights our commitment to delivering robust financial performance, driven by exceptional product launches, while we continue to invest in innovation. And on the basis of this strong first half, we feel confident to upgrade our guidance for the year. And so if we move to the next page, we increased our revenue guidance to at least EUR 7 billion for the full year, our EBITDA margin to at least 30% and our core EPS to at least EUR 7.25. On revenue, overall, we expect the key growth drivers will continue with the strong momentum for the second half. On BIMZELX, we do expect to see continued strong volume growth and the effectiveness of access in the U.S., observing that the conversion to the paid scripts has already achieved a high level in the first half. And maybe a few additional elements to highlight for the convenience of your modeling the second half of the year. On CIMZIA, as mentioned, some favorable elements supporting the first half performance will not repeat in the second half, and price erosion is expected to continue. Since the currency impact, particularly U.S. dollar depreciation is expected to be a stronger headwind in the second half versus the first half. So if the average July rates were to prevail for the remainder of 2025, we would expect the full year currency impact to be a negative 3 percentage points on net sales for the full year. And while the net sales are exposed, we are not expecting any major negative impact on EBITDA on the year. On this year, as a reminder, the hedging policy is to hedge most of the cash flow 1 year in advance, and therefore, EBITDA is mostly protected in 2025. And maybe a last comment, a reminder that you can see on the left part of the chart of the fact that 2024 included EUR 427 million that we're flagging on the left part to help the like-for-like comparison, and that includes the sum of the proceed of the 2 established brands that we did last year. That includes the [ Minasin ] termination impact and the sales of the 2 established brand and the site China neurology and allergy portfolio, and the majority of this was on the second half of 2024. So reflecting all these elements, we are confident to move up the revenue guidance to at least EUR 7 billion compared to a range of EUR 6.5 billion to EUR 6.7 billion previously guided. Now if I move to the EBITDA margin, we expect to deliver at least 30% EBITDA margin, same key drivers as in the first half, continued gross margin improvement, thanks to the mix of the portfolio and operating leverage supporting the margin expansion. Marketing and sales will continue to increase. R&D expense should be relatively stable in absolute and decreasing as a percentage of revenues. EVENITY will maintain its growth trajectory and consistent with our approach in the prior years will continue to effectively manage the tail ends of our portfolio. And with this, core EPS is expected to be at least EUR 7.25 with financial expenses slightly lower than '24 and a tax rate of around 20%, consistent with the first half. And as I mentioned in February, there are no impact reflecting this guidance of potential tariffs that could be imposed on export goods to the U.S. We do not yet have full visibility on the scope of the various agreements nor do we have the outcome of Section 232. We've taken proactive steps to ensure sufficient inventories in place in the U.S. to meet patient needs over the coming months. Therefore, we do not anticipate a material impact on the 2025 results if and when tariffs would be effective. So this concludes the financial part of the presentation. And with this, let me thank you and hand over to Jean-Christophe.
Jean-Christophe Tellier: Thank you, Sandrine. Thank you, Emmanuel. Thank you, Fiona, for these additional explanation that go deeper into our first half result. Next slide, please. So I hope that with this global overview, you will be able to share with us the confidence that we have in the future based on unprecedented growth that we are delivering today. I think the focus on innovation, the differentiation of our portfolio, ability to invest into the pipeline give us the best possible way to enter into this decade piece of growth that we have started to share with you last year. This decade of growth, despite the uncertainty of the environment, we'll be able to guide us towards more ability to offer to patients suffering from chronic disease, the life that they want to live and provide to shareholders, employees, the best possible return and to protect the planet. So with that, I would like to thank you again for your attention, and we'll hand over to the Q&A now.
Antje Witte: Thank you, Jean-Christophe. We will now start the Q&A session, which will be handled by our operator today. [Operator Instructions]. You can also e-mail your question to me under antje.witte@ucb.com, and I will ask the question on your behalf to the presenters. Operator, kindly explain how to ask the question, please. Thank you.
Operator: Thank you, Antje. Ladies and gentlemen, we will now begin our Q&A session. [Operator Instructions] Our first question is from Stacy Ku from TD Cowen.
Stacy Ku: Okay. Hopefully, you all can hear me all right. Congratulations on a really impressive half for BIMZELX and some really solid [ POC ] for galvokimig. So 2 questions, first, maybe, Emmanuel, could you provide some updated thoughts on near-term HS adoption? Your 80,000 biologic-treated estimates look to be somewhat conservative versus Novartis' epidemiological expectations for biologics -- patients on biologics this year. And if you can't go into that type of detail, maybe just help us understand where the commercial team is most focused in terms of HS adoption? Is it competitive dynamics within IL-17, expanding patient size? Or is it really simply just making sure the commercial team is prepared to handle the access and service the HS patient volume. And then the second question is maybe for Sandrine. The total revenue guidance suggests -- or Emmanuel. The total revenue guidance to suggest BIMZELX sales will remain second half weighted with some good momentum. So maybe talk about the pushes and pulls there? Thoughts on net pricing into the second half, what nuances we should consider? Just help us understand that dynamic. And congrats again.
Emmanuel Caeymaex: Thank you, Stacy. So in terms of the dynamics to HS adoption, the first thing I'd say is that a large contribution of the numbers you've seen there come from the U.S. So the U.S. HS market has been developing very fast. This being said, over the last 6 to 9 months, we've observed that the main dynamic was a substitution of adalimumab by the IL-17 agents, Cosentyx and ANF BIMZELX. So in terms of future growth, I would say that the jury is still out and that the IL-17 companies over the next year or 2, we'll need to move investments towards market expansion as we are more than midway towards this replacement of the TNF mode of action by IL-17. The commercial teams are still very much focused on ensuring that BIMZELX is understood. That it leads efficacy is well understood and that the experience of physicians and patients is optimal. And we're seeing the surveys that we conduct, that we now have achieved very good scores across all those metrics. We also see that the adoption by dermatologists has been quite broad with about 4,000 prescribers in the U.S. for HS. And so from here, we can really look to continue to expand our share within the patients that are diagnosed and treated. And as we look into the next year or 2, look at strategies that will aim to expand the market. But for now, that is still too early as our dynamic share isn't yet dominant. Then in terms of the dynamics for the second half of the year, well, as you know, all those treatments are [indiscernible] treatments. The persistent traits with BIMZELX are very high, relatively, which means that we naturally will see a continued expansion in all the diseases for which the product is indicated. And to that, you will add the fact that access is expanding outside of the U.S. for the various new indications. So there's still a little bit of a flywheel effect to the rollout of the various indications internationally that will contribute in addition to the market share gains and to the additional patients. In terms of pricing, out of U.S., I would say pricing will be stable. And within the U.S., typically pricing is agreed on an annual basis. So I'm not forecasting huge changes when it comes to pricing. We already have gained a lot in terms of the paid scripts ratio. So there may be some incremental gains left for us this year. But I think that we're probably getting closer to decreasing marginal gain here even though we, of course, pursue that. So I hope that this helps you to understand where BIMZELX will go in the second half of the year, Stacy.
Operator: Our next question is from Charles Pitman from Barclays.
Charles Pitman: Charles Pitman from Barclays. Two more on BIMZELX. Just to dig a little bit more into that pricing dynamic, please, Emmanuel my understanding based on gross to net conversations at the beginning of the year is that the split of HS patients between those on the bridging program and they will progress to reimbursement at a less price level. And over time, when you renegotiate access with formularies, they will then shift to a negotiated rebate level. So just thinking about as we start to see conversations with reimbursers and insurers for coverage, how should we think about pricing between [indiscernible] and that full on formulary cover for next year? Could that generate some negative pricing pressure and should that be more than offset by the rising volumes as you highlight given the significant prescription uptake? So just some more thoughts around that would be really helpful. And then just secondly, on the future of the HS market. I was wondering if we could just get some comments around how you think about clinical differentiation potential on a placebo-adjusted high score 75 and high score 50, that would make you think that BIMZELX couldn't face -- could, in fact, face some competition from novel therapeutics.
Emmanuel Caeymaex: Charles, thank you very much. To your first question, the simple answer is yes. So indeed, with expanding access usually comes an extended rebate rate on average. We fully model them, but of course, the growth in patient numbers will clearly we'll clearly outnumber that I mean it's a very typical dynamic. In the first half, we actually did open access for BIMZELX with 2 of the big 3 PBMs and some of their downstreams in single step edited position, meaning a patient having failed on either Humira or Cosentyx would be able to get BIMZELX in a covered fashion. So now in terms of bridge dynamics, I would say that many HS patients in the early days were patients that have suffered for a while, had tried 2 treatments. And so pretty quickly, they access to BIMZELX if not in a covered manner on a medical exception manner and which also explains the attractive gross to net rate or the net sales associated with HS as you saw that as a proportion of total sales for BIMZELX, really driven by the U.S. You had a second question, Charles?
Charles Pitman: Hopefully, he's telling me. Yes, just in terms of kind of thinking about future differentiation versus be heard would mark clinical differentiation in your view?
Emmanuel Caeymaex: Look, I'm not going to speculate about what results might be in the future. What I can tell you is, from what I've seen so far, I haven't really seen something that if you properly adjust it per phase statistical analysis plan looks very different. So again, let's see how the upcoming agents report on their Phase III studies. But certainly, there's nothing that I see in the data that have been shared so far that looks significantly different or in my opinion, that would even enable to power a superiority study, for example.
Operator: Our next question is from Peter Verdult from BNP Exane.
Peter Verdult: Happy to do this, thank you so much. So just asking a question to Sandrine. UCB will stay innovation focused, but BIMZELX is set to have a powerful effect on the P&L. Current EBITDA margin guidance of more than 30% is [ Silian's ] context. Why will it not be more than 40% of in the longer term? Second question is about the galvokimig data. So I think it's going to Fiona. The doctors are excited, interested in UCB's thoughts and dosing intervals being planned in the Phase IIb. Thank you.
Sandrine Dufour: So the at least 30% is the guidance for this year '25. And as you know, we're not providing a long-term guidance, a long-term margin guidance. And on the long term, I agree that there are levers to continue to increase EBITDA margin with top line growth with the operating leverage. I think we've said in the past, the long-term ambition is to achieve the comparable profitability levels. But I don't want to give a new guidance on the next 3 or 5 years. I also want to call out that we indeed will maintain our strong commitment to the R&D and to the innovation. Thanks.
Fiona du Monceau: Thank you, Peter, for the question. And thank you for sharing with us that the physicians you talk to are excited about our data. We too are quite excited about the data and we will be sharing more in September at the EADV conference in Paris. Too early to share details on dosing of Phase IIb but please do stay tuned, and you'll have more information very soon. Thank you.
Operator: Our next question is from Xian Deng from UBS.
Xian Deng: Two, please. The first one is to Emmanuel, just wondering I mean think about the overall level of rebate for BIMZELX, for the sake of argument, the long-term average for this sort of category is about 50%, 5-0. Do you think it's fair to say that we are probably -- for BIMZELX is only halfway there, given only psoriasis as strong line [indiscernible] is still kind of upcoming and then this -- whatever level of the rebate rise probably relatively stable for the rest of the year until you actually go into next year's negotiation. So that's the first question. And then the second one, also to Emmanuel please. Just wondering what do you think -- how should we think about the BIMZELX HS dynamics for the rest of the year? If we think about Cosentyx this time last year, they had a big initial bolus of patients that had no treatment options for a very long period of time that have gone to Cosentyx. And then have you already seen some of them start to switch to BIMZELX? Or do you expect the majority of the bolus to actually come in the second half? That's also why we should also expect even more accelerated HS adoption in the second half?
Emmanuel Caeymaex: Thank you, Xian. And in terms of the levels of rebates, I would say that we're in line with industry averages. But there's different components to rebates, right? There's the actual rebates to PBMs. But then there's also the statutory rebates in Medicare, which together probably more or less of the size of what goes into 340B. And so one really needs to think about BIMZELX across those various channels. I agree with you that for the second half of the year, it's likely to be relatively stable as we largely have stable contracts for this year. Of course, we will try to improve incrementally here and there with custom plans. And then in terms of HS dynamics, currently, we have almost 4 out of 10 patients that are labelled as bio-naive, meaning they haven't had biologic treatment over the last year or 2. The second source of business for us is indeed switches from Cosentyx and the rest is switches from other products. Now if you look at the number of patients that have been approved and along Cosentyx, there's still probably a big bolus of patients there that's over time. will be candidates for BIMZELX. And so I would foresee that dynamic to continue to be strong in the second half of the year.
Operator: Our next question is from Rajan Sharma from Goldman Sachs.
Rajan Sharma: Just on the tariff piece. So Sandrine kind of heard your comments there that there's uncertainty that still exists but you have inventory in place for 2025. At what point might you start thinking about building inventory to insulate yourself against potential tariffs in 2026? And then one question just on galvokimig, although not specifically on galvokimig, I know you don't want to say too much ahead of the data presentation, but it would just be helpful to understand your view of the atopic dermatitis treatment market. Where are the areas of unmet need? Do you think patients need more efficacious products, safer products or potentially less frequently dosed products?
Sandrine Dufour: I can take the first one on the tariffs. What I said is that we have indeed moved the inventory in the U.S. for the coming months, I have not given further time lines and we continue to produce and we'll see, but it's a pace that needs to be in control. We need to think as well on the shelf life and the supply chain overall organization. So certainly, we are preparing ourselves, looking at what we can do. But for sure that what's missing is really the visibility on how things will unfold and hopefully, we should have this in the next weeks also.
Fiona du Monceau: Thank you for your question on the atopic dermatitis field. I think as you know, there's -- there remains a significant unmet need for these patients. As you've seen from our reducted data. We've shown some significant improvement in EASI-75 as well as impressive differentiation in the EASI-90 and 100. So what we're truly looking for is ensuring that we are bringing something that makes a difference to patients and to their lives. So something fast durable and that has a deep impact. Thank you.
Operator: Our next question is from Sofia Graeff Buhl-Nielsen from JPMorgan.
Sofia Graeff Buhl-Nielsen: So you've seen encouraging data from Galvokimig we're waiting results from donzakimig. Given the competitive landscape in atopic derm at either one or both of these assets under consideration for a partnership? And then just in terms of opportunity for BIMZELX and BP, I think competitors have cited this as a potential EUR 3 billion to EUR 4 billion market by the end of the next decade. Is this aligned with your view of how you think of the opportunity?
Fiona du Monceau: I mean we've got great data with Galvokimig. We're willing to see the later end of the year donzakimig. They are different multi specific antibodies with different properties. And we -- once we have the data of both, we will look at them independently on where we can maximize the different assets. Thank you.
Emmanuel Caeymaex: Yes, on the PPP opportunity, I think that's probably an optimistic view. It is possible, but I think it's perhaps a little early to call these kind of numbers. The point being, today, no treatments are approved. What is being used off label is not particularly effective. So there is a potential for that to happen. And PPP in certain cases, presents on its own and in certain other cases, presents with psoriasis or psoriatic arthritis. So it's a different entity that is associated with comorbidities. The reason we are very confident about BIMZELX's impact here is, first of all, the data that Fiona referred to that were published in JAMA dermatology. And then second, really the proof that IL-17F plays a role in PPP as a disease. And so therefore, we really see this as an opportunity within PPP itself, but also in a broader way to really cements BIMZELX leadership in IL-17 mediated diseases. And so part of the value we ascribed through that as well.
Operator: Our next question is from Kerry Holford from Berenberg. Thank you and Kerry asked me her question as she is connecting from the her vacation place. So the first question is on BIMZELX in HS, I think it's going to Emmanuel. There's positive progress with this indication that which has surprised you in the market. Novartis clearly lost share to you but has talked about fighting back by focusing on the better efficacy seen with more frequent dosing of Consentyx. Meanwhile, MoonLake Phase III data readout is coming. What are your expectations for BIMZELX market positioning in HS in the context of the competitive environment? Second question is for Sandrine. It's about the full year '25 margin guidance. Adjusted EBITDA margin guidance for at least 30%, you almost hit that level in H1. Are you being conservative with your H2 outlook? If strong momentum continues, as you expect for the top line, continuing the positive mix shift, why not more optimistic on H2 margins? Thank you.
Emmanuel Caeymaex: Thank you, Kerry, for those questions. So I'm not going to comment on Novartis' commercial stage but let me remind you that BIMZELX is a dual IL-17A and IL-17F inhibitor. And so bumping up the dose typically means that a patient may not be deriving for benefit from a single mode of action, meaning IL-17 inhibition. And we've seen also in U.S. real data that those patients that get escalated also are those patients that are likely to discontinue. So I'm confident that, over time, many patients will switch over to BIMZELX, which combines a very selective and potent 17A inhibition with the inhibition of 17F, which has been shown to be very present in HS lesions. And probably underpins some of the clinical results that we've observed in our mid- and late-stage studies. Then in terms of market position for new entrants. Look, I think this is -- it's not unprecedented, right? We've had 5 anti-TNFs. We've had a few anti-IL-6 in autoimmune disorders. So there will be a place, we welcome competition. 17A and F drill inhibition is a great mode of action. HS is a heterogenous disease, very much so, which means that there is going to be a space for different modes of actions as well. And the art will be to find which mode of action works best for what patient. In the meantime, we are accruing a lot of real-world experience, a lot of real-world data. And I think we'll be in a very strong position by the time new entrants come to help serve patients in the HS space.
Sandrine Dufour: Yes. And so on the full year margin, EBITDA margin is expected to be better in the second half versus the first half, despite the fact that we will spend more in marketing and sales in the first half and more in R&D than the first half. And as you know, we are still in this early phase of many launches, we see good traction on the return of our investments so we feel that there are opportunities to further invest behind the brands to maximize the trajectory, and we will do so. And on top of that, you need to factor what I've explained on the dynamic of the net sales in the second half with a mechanical lower growth in the second half versus the first half in the net sales with the one-off not repeating and the FX. So all of that, that's why we say at least 30% for the full year.
Operator: Our next question is from Naresh Chouhan from Intron Health.
Naresh Chouhan: Just firstly, again, going back to BIMZELX and net price please. We estimate that price fell by 15% in H1 '25 versus H2 '24. Obviously, we'll expect in '26, you to try and get more access which I would imagine would require more rebates. There should really -- and there's obviously lots of competition. So should we be breaking in double-digit price cuts on an annual basis over the medium term? That's the first question. And then secondly, can you just give us a bit more color around sales and marketing cost growth? I'm just trying to get a feel of leverage into '26, please. I would imagine that in the U.S., you're -- there's minimal incremental growth given you fully invested in launches and DTCs underway. And you're now launching 50 countries ex U.S. So just some color around what the drivers of sales and marketing growth would be. Thank you.
Emmanuel Caeymaex: Thank you, Naresh. I'm going to be a bit cryptic on net price. There's there's a lot that comes to see to get from gross to net prices. I think directionally, you are right, in particular in the U.S. we would expect some erosion over time. I'm not sure I would go double digit for several years. But of course, in the near term, it is likely to happen even though we continue to try and ensure that as many patients are possible as possible are actually on paid for scripts. And the script count itself, it is something that also has its books and takes since we work with an internal bridge with specialty pharmacy. And so I appreciate that those calculations are not necessarily easy. I would also remind you that for now, we're still very much in launch period and accruing a lot of new patients who in some diseases like psoriasis and hidradenitis suppurativa go through induction doses. So meaning the number of syringes and sometimes even the number of prescriptions per patient tend to be higher closer to an indication launch as the proportion of new patients are higher. Sandrine, perhaps I'll hand over to you in terms of a general comment on sales and marketing cost growth.
Sandrine Dufour: So well, as you know, we'll give more color on the various elements of the OpEx when we guide for next year in February. But directionally, for sure, at some point, we don't expect to see it has higher growth on the key components of marketing and selling expense except what I really wanted to call out, which you need to see, which is what we -- the fee for service expenses, which are booked in the marketing and selling expenses and apply in the U.S. these fees, they are based and a percentage of the gross sales, not the net sales across -- the volume in a way. So it means that there's a portion of the marketing and sales, which is increasing very significantly that you need to have in mind. And of course, if we were to exclude that, you would see a better operating leverage with the marketing and sales expenses.
Operator: Our next question is from Charlie Haywood from [ RECH ].
Charlie Haywood: Charlie Haywood, Bank of America. Big picture question on MFN. To the extent you can comment, obviously, how are conversations progressing here? And do you have any sense of the potential channel that could be a focus or the likely extent of any demonstration projects? And within that, are there -- are you discussing any specific product price discounts or our DTC sales a potential future strategy? And then second question, BIMZELX, I'll try my luck here. You noted at full year '24, you're comfortable with BIMZELX cons of EUR 1.3 billion to EUR 1.4 billion for 2025. And it sounds like BIMZELX has driven the majority of sales guide upgrade of EUR 400 million at the midpoint. So would it be reasonable to think you're comfortable with higher sales of around EUR 1.7 billion to EUR 1.8 billion for full year '25?
Emmanuel Caeymaex: Thank you, Charlie. So on MFN, I'll give you a few comments. I'll also invite Jean-Christophe to add some color. So of course, UCB is preparing for potential interactions with [ HHS, CMS ] and representatives of the administration. I think it's a little bit of a moving target. And so right now, what I can say is that as everybody else, we are looking at opportunities for direct-to-patient platforms and which parts of our portfolio might actually be relevant here. We actually do have a small targeted offering already with 2 of our antipolitics which are subject to generic competition. So this is not completely new for us. In terms of demonstration projects, obviously, Medicare B, perhaps D and potentially Medicaid could be candidates. So there, we haven't heard much but are preparing as well to engage if and when needed. But the bigger picture is that whilst we recognize that there needs to be a fair sharing of the investments and the risks that come with generating new medicines we are also of the opinion that in the U.S., a lot of the reasons why patient prices and out-of-pocket prices are high, which is really driving voting sentiment. Is the fact that there's a lot of intermediaries and 340B shops that capture about half of the values being generated. And so we very much would like to ensure that this gets addressed. And if we can be a part of this alongside other industry players, then that is something we will consider. Now in terms of BIMZELX and/or simple arithmetics, it's hard to disagree. I'm not going to commit to a number. It kind of makes sense the top line, so I'll just keep it at that from now, Charles.
Jean-Christophe Tellier: Thank you, Emmanuel. And from my side, I don't have anything to add to what Emmanuel have said. The only maybe additional comment that I would add on these notions of pricing is effectively that it's the patient experience at the pharmacy that lead to today a lot of younger and frustration there. And I think it's also fair to say that different countries needs to make sure that the support of innovation, which is so important as there is a high level of a medical need that remains that there is this support to innovation in the various country that can support it.
Operator: Our next question is from [ Michael Lui ] from Jefferies.
Unidentified Analyst: Thanks for the opportunity. The first one is for Fiona on Galvokimig. Now that you have decided to go into a Phase IIb in atopic dermatitis. Can you talk to subgroup or target profile? And the second question is, again, to Emmanuel. Can you talk to the source of U.S. patients TNF alpha versus Cosentyx?
Fiona du Monceau: Thank you, Michael, for the question. As you know, we've -- for the moment, we've done a Phase IIa, which is still limited in numbers. So too early for us to provide you more details on subgroups. But overall, the efficacy was really great, as you've seen. Thank you very much.
Emmanuel Caeymaex: Yes. And thank you for your question with -- I assume pertains to our source of business for hidradenitis suppurativa. So in the United States, IL-17A Cosentyx is actually a larger source of business now than TNF. And that's changed probably around the end of the first quarter. In the rest of the world, anti-TNF is still the first source of business.
Operator: Our next question is from Emmanuel Papadakis from Deutsche Bank.
Emmanuel Douglas Papadakis: Just a couple of follow-ups, please. Maybe one on tariffs. You've alluded to the persisting uncertainty but let's assume that 15% is the minimum impact. Could you talk a little bit about what headwind that creates for you in 2026 and indeed beyond until you're able to either bring CMO or indeed to a new U.S. facilities in mind? And I'm not sure if you've actually ever clarified exactly how much CapEx you're planning to invest in the U.S. You obviously mentioned the EUR 5 billion of economic impact. But if you could talk a little bit about the magnitude of CapEx and the time frame for investing that. Is that going to be particularly concentrated over 1 or 2 years or spread out, for example? And then maybe -- and it's perhaps a related question, a bit more color on the internal tax reorganization would be helpful. The rationale for that and talk to us about tax outlook over the coming years, it seems to be a fairly material step change in your tax situation.
Sandrine Dufour: Right. So on tariff, I will not expand further because you cannot just say 15% in there. So many different underlying assumption. Now it could apply or not apply, whether it's at the drug substance, the country of origin, et cetera. So I think it's not useful to speculate there. And once we have visibility, we'll make more comments. On CapEx, the certainly, the investment in the U.S. is something that is greenfield, as we say. So it will take time for us by the time we identify the location and put this at work CapEx will be spread over time. However, overall, we expect our CapEx to increase. We are in a period of growth, and we want to be able to support the growth over the long term. We are also strategically reinforcing the resilience of our supply chain and definitely for those the past level, you should expect to see growth of our CapEx. Part of the reason is the U.S. investment, but overall, the other investment that we are doing to support the resilience of the supply chain for the long term growth of the company, but also for the pipeline, which is coming. And last, on your question on tax, it's part of a usual level of company to constantly look at what makes sense from that point of view. And that's why we went through a reorganization. And if you think of where we are, I think we've always said that long term, the tax rate would be around 20%. So we are now getting very close to the long-term range we have in mind. So that's the 20% that we talk about in an environment where we will continue to use the R&D incentives but also have to manage the overall international environment with the minimum tax rate that hit in many different countries.
Operator: Our next question is from [ Kia Ding ] from Redburn.
Unidentified Analyst: I have one question related to BIMZELX. So today, you announced the initiation of a Phase III trial for BIMZELX in PPP. Given BIMZELX has a differentiated mechanism of action. So do you think there is room for potential indication expansion for BIMZELX in the future?
Fiona du Monceau: Not 100% sure I understood your question. So we are going ahead with the palmoplantar pustulosis where we believe the BIMZELX can bring a significant difference including based on sort of the small numbers that [ Professor Patron ] in France has seen. We are constantly looking at how we maximize each one of our assets and what additional indication as well as balancing sort of that pipeline in markets with new indications, late stage in an earlier stage and we'll keep you posted as we bring more.
Unidentified Analyst: But beyond PPP, do you have any other potential indications that you think BIMZELX can expand into?
Fiona du Monceau: As mentioned, we're constantly looking at additional opportunities. Today, we announced the PPP for BIMZELX and RETT for FINTEPLA. And we constantly assess new opportunities and balance the needs between our end market and newer once.
Operator: Our next question is from Jacob Mekhael from KBC.
Jacob Mekhael: I just had one on how you look at the potential impact on ZILBRYSQ from Astra's once weekly subcu C5 inhibitor, which recently met its Phase III end point?
Fiona du Monceau: Should I take that one Emmanuel or you want to thank take it?
Emmanuel Caeymaex: Why don't you start and I'll chip in.
Fiona du Monceau: So one, it's important to know that it's a very heterogeneous disease. So there's different needs for different types of patients. I think you'll see that ZILBRYSQ has demonstrated significant improvement versus placebo by week 12, and that sustained over 120 weeks. And many of those patients, up to 61% also see steroid reduction, which, as you know, has a significant benefit for patients. So we believe that we've got a product that's really making a difference of patients that is easy to use and convenient. Emmanuel, anything else you want to add?
Emmanuel Caeymaex: You're right. I mean -- and ZILBRYSQ it's a macrocyclic peptide, right? So it's very fast, and it has a fantastic lasting power. And so the question will be, and we'll look at the data to see whether it's format will produce similar clinical efficacy data. So that's something I'll be looking out for.
Operator: Your next question is from Maxime Stranart from ING.
Maxime Stranart: Thank you. This is for Sandrine. He's asking for the phasing of the EUR 2 billion CapEx program for, I think, you mean the plant in the United States, over '25 to 2030? And second question is the market potential and the R&D costs attached for the new potential indications of BIMZELX? Thank you.
Sandrine Dufour: Right. So as I said on the investment in the U.S., it's going to be spread over time. So I'm not aware that we've given spread of our CapEx per program in the past, and we will not start this, but '25 would be minimal. That's as we are more in the study phase, and it will ramp up as of next year. So but it's something that takes time to build. And I don't think we give either the cost per program on R&D, I'm not sure if that was the question. So I will not go further.
Operator: Our last question is from Xian Deng from UBS.
Xian Deng: So just a very sort of quick one, in terms of longer term both BIMZELX and general space. So now we've seen actually a quite interesting oral molecule Icotrokinra from J&J. That's actually for the first time, actually demonstrated at least some sort of early-stage biologic type of efficacy. I mean, of course, that's still nowhere near BIMZELX level, but just wondering, in the very longer term, potentially, we will see a wave of actually biologics like oral options on the market when you think about the long-term position of BIMZELX versus potentially efficacious oral?
Emmanuel Caeymaex: Yes. So as you point out, those oral products are associated with a different level of clinical efficacy. So it is possible that these products could take share in the segments that are currently occupied by oral therapies in psoriasis and elsewhere. I mean, many -- what I'm hearing from physicians is that when somebody has already been on a treatment every 4 weeks or every 8 weeks or even every 12 weeks, moving to something that potentially is not as efficacious and needs to be taken on a very regular basis, even once a day, it's not really a big plus. However, for incident patients with mild-to-moderate disease. It could be an option that will find its place as other oral treatments have in the past. So we'll continue to keep an eye on those developments, and react accordingly. But I think for now, BIMZELX amongst oral biologics is probably one of those that is going to be exposed to these kind of potential new entrants.
Fiona du Monceau: If I may add just a patient perspective, with HS, the scarring is dramatic and delaying treatments or delaying really effective treatments that has a lasting impact. So speed and efficacy is really important for these patients and getting the treatments as early as possible is really important.
Operator: Thank you. This concludes the Q&A session. I will now hand back to Antje Witte.
Antje Witte: Thank you so much indeed. I think the plenty participants, your very engaged questions and thanks to the -- to our speakers. This now concludes the first half '25 call. Have a wonderful break, if you go for a break. And do please reach out to us to the UCB Investor Relations team for any more questions or any more help. Thank you, and goodbye.