Novo Nordisk A S (NVO) Q4 2023 earnings call transcript

Welcome to this NOVO NORDISK earnings call for the full year of 2023 and the outlook for 2024. My name is Daniel Musman-Bosen, and I'm the head of investor relations at NOVO NORDISK. With me today, I have CEO of NOVO NORDISK, Lars Brugger Jørgensen, Executive Vice President and Head of Commercial Strategy and Corporate Affairs, Camilla Sundbest, Executive Vice President and Head of North America Operations, Doc Lange, Executive Vice President and Head of Development, Martin Holz Lange, and finally, Chief Financial Officer, Karsten Munk Knusen. All speakers will be available for the Q&A session. Today's announcement and the slides for this call are available on our website, noenodis. com. Please note that the call has been webcast live and a recording will be made available on our website as well.

The call is scheduled to last one hour. Please turn to the next slide. The presentation is struck out as outlined on slide 2. Please note that all sales and operating profit growth statement will be at constant exchange rate unless otherwise specified. Please turn to slide 3. We need to advise you that this call will contain forward-looking statements. These are subject to risk and uncertainty that could cause actual results to differ materially from expectations.

For further information on the risk factors, please see the company announcement for the full year 2023 and the slides prepared for this presentation. With this, over to you, Lars, for an update on our strategic aspirations.

Thank you, Daniel. Please turn to the next slide. In 2023, we delivered WG to sell and operating profit growth, and we continue to make progress on our strategic aspirations. I'll walk you through the performance highlights before handing over the word to my colleagues. We continue making progress on purpose and sustainability. Our carbon emissions decreased by 34% compared to pre-pandemic levels in 2019, And in 2023, we reached more than 14 million patients without diabetes and obesity treatments.

To uphold our commitment to being a sustainable employer, we expanded the number of women in senior leadership positions to 41% compared to 39% at the end of 2022. In the past year, we have developed and expanded our pipeline across all our therapy areas. In diabetes and obesity, we have seen several exciting trial readouts, and we have advanced novel assets into phase three.

We have also expanded our footprint in cardiovascular disease and strengthened our late-stage pipeline in rare blood disorders. Martin will come back to this and our overall R&D milestones later. In 2023, we have achieved two major milestones within commercial execution. We have reached our obesity sales operation of more than 25 billion Danish kroner, and our aspiration for diabetes, which was to achieve one-third of the global diabetes value market. Going forward, we continue to aim for treating more patients with our innovative treatments.

Lastly, we are very pleased with a strong sales growth of 36% and operating profit growth of 44% in 2023, both measured at constant exchange rates. Now I would like to hand over the word to Camila, who will give us the latest update on our commercial execution.

Thank you, Lars, and please turn to the next slide. In 2023, our total sales increased by 36%. The sales growth was driven by both operating units, with North America operations growing 54% and international operations growing 15%. Our GLP-1 sales in diabetes increased 52%, driven by North America growing 52%, and international operations growing 53%. Insulin sales decreased by 6%, driven by declining sales in the U. S. and region China. Thank you. Natural rare disease sales decreased by 15%, which was driven by a 24% decrease in international operations, and by a 1% decrease in North America operations, following a reduction in supply of Nordic open. Please turn to the next slide. With 29% sales growth in diabetes care, we are growing faster than the total diabetes market.

As a result, our global diabetes value market share increased to 33.8%, which is above our strategic aspiration of reaching one-third of the global diabetes value market. This increase reflects market share gains in both North America operations and international operations. Please turn to the next slide.

In international operations, total diabetes care sales increased by 20% in 2023, which was primarily driven by GLP-1 sales, growing 53%. NOVO NORDISK is the market leader in international operations with a GLP-1 value market share over 70%. OSEMPIC continues its GLP-1 market leadership with 47.5% market share. Rebelsos has just shy of 14% value market share driven by solid uptake across geographies. And with that, I will hand over the word to Doug.

Thank you, Camilla. Please turn to the next slide. In the U. S. , sales growth of our GLP-1 diabetes treatments are driven by a 50% expansion of the market in 2023 versus 2022. In the fourth quarter of 2023, the prescription volume growth of the GLP-1 class was more than 30% compared to the fourth quarter of 2022. Measured on total prescriptions, NOVO NORDIS continues to be the market leader with around 54% market share. Please go to the next slide. Obesity care sales grew by 154%, driven by both operating units. The volume growth of the global branded obesity market more than doubled, with a volume growth of 116%. In international operations, obesity care sales are driven by a strong SacSenta performance and the WGOVI launches in seven international operation countries.

In the U. S. , sales of WGOVI grew by 393%, reflecting the commercial relaunch in January of 2023. To safeguard continuity of care, we reduced the release of lower-dose strengths back in May of 2023, which continued throughout the remainder of last year. I am very pleased to state that we are now enabling more new U. S. patients to initiate treatment by more than doubling the amount of the lower dose strength of Wagovi compared to the previous months.

We will gradually be increasing the overall supply throughout the remainder of 2024. Please go to the next slide. Our rare disease sales decreased by 15%. The sales decrease was driven by a 1% sales decline in North America operations and 24% sales decline in international operations. Sales of rare blood disorders increased by 3%, driven by the launch products in hemophilia A and B, and partially countered by NOVO 7. Sales of our rare endocrine disorder products decreased by 47%, reflecting a reduction in manufacturing output. Now, Martin, over to you for an update on R&D.

Thank you, Doug. Please turn to the next slide. First, I'm very pleased to share the exciting headline results from the Combine Free trial with once-weekly IQSEMA. Combine Free was a 52-week open-label, treat-to-target phase-free trial, comparing once-weekly IQSEMA with once-daily insulin gladin U100 together with up to four daily injections of insulin aspart. This is also called basal bonus insulin treatment. The objective of combined 3 was to assess the efficacy and safety of once-weekly icosema in people with type 2 diabetes poorly controlled on daily basal insulin.

The trial achieved its primary endpoint of demonstrating non-inferiority in reducing A1C at week 52 with once-weekly icosema compared to insulin-large in U100 together with insulin aspart. From an overall A1C baseline of 8.3%, once weekly IcoSema achieved an estimated reduction in HPA1C of 1.47 percentage points compared with 1.40 percentage points for insulin glagen together with insulin aspirin. People in the trial had a baseline body weight of 85.8 kilograms. Treatment with IcoSema achieved a superior reduction in body weight with a weight loss of 3.6 kilograms with IcoSema compared with a 3.2 kilogram weight gain with the insulin basal bolus treatment.

The estimated treatment difference was 6.7 kilograms. IcoSema also showed superiority over insulin glagin U100 together with insulin aspart in terms of severe or clinically significant hypoglycemic events, with only 0.26 events per patient year of exposure compared to 2.18 events per patient year of exposure in the basal bonus treatment arm. Overall, IcoSema appeared to have a safe and well-tolerated profile. These phase 3 results for once weekly ICOSEMA are very promising.

For people with poorly controlled type 2 diabetes on basal insulin, ICOSEMA has the potential to streamline insulin intensification by addressing the main patient barriers. I-GUSEMA sets a new standard for once-weekly treatment by reducing the annual injections from around 1,450 to 52 injections. This substantial reduction in patient burden is provided together with a strong glycemic control, proper weight management, and importantly, a factor of 10 times lower rates of hypoglycemia as compared to the current gold standard of insulin-basal bolus treatment.

Please turn to the next slide. Turning to the upcoming RNG milestones, there are many exciting trial results in 2024. However, before I get to that, I would like to highlight a few of the milestones from the fourth quarter of 2023. Within obesity, we have successfully completed two Phase III studies with semaglutide 2.4 mg addressing obesity-related comorbidities, as well as the Phase I trial for oral amicretin.

First, the STEP9 trial was a Phase III knee osteoarthritis trial that investigated the effects of semaculatine 2.4 mg once weekly on the co-primary endpoints of body weight and the Western Ontario and McMaster University's Osteoarthritis Index, abbreviated WOMAC. This is a self-administered measurement used in assessing pain and functionality. In the trial, 407 people with obesity and mild to moderate knee osteoarthritis were enrolled.

The study achieved its co-primary endpoint by demonstrating a superior reduction in both the WOMAC pain score as well as in body weight with semagrotype 2.4 mg compared to placebo. The estimated reduction in mean WOMAC pain score from baseline to WINC68 was 41.7, was a magnetized 2.4 mg, and 27.5 with placebo. The estimated treatment difference was 14.1, which was not only statistically significant, but also considered clinically very relevant. The trial results will serve as a foundation for potential IALCON trials with future obesity assets.

In addition, we have successfully completed the STEP-HEF-HEF diabetes trial. The STEP-HEF-HEF diabetes trial investigated the impact of somatic heart treatment on physical pain and symptoms in patients with obesity, type 2 diabetes, and established heart failure. In total, 660 people were enrolled in the study. The co-primary endpoints were the average change from baseline in the Kansas City cardiomyopathy clinical summary score questionnaire and body weight. In the trial, samaritide showed a 13.7-point improvement versus 6.4 in the placebo arm at 52 weeks. The mean change was 7.3 points in favor of semaglutide, which is considered clinically very relevant and very solid results with chronic heart failure.

A superior reduction in body weight was also observed for semaglutide 2.4 mFM versus placebo. We have submitted the results from the STEP-HF-PEF obesity trial as well as the CHI-2 diabetes trial for regulatory review in US and Europe during the course of January of 24. This marks an other milestone in our ongoing efforts to address the unmet medical needs in patients with overweight, obesity, and established cardiovascular disease. The last highlight for the fourth quarter of 2023 is the successful completion of oral amicretin phase 1.

This trial appeared to have a safe and well-trail rated profile for amicretin. We have decided in September of 2023 to also initiate a phase 1 trial with 1,3D subcutaneous amicretin. And further, we expect to advance hemicretin into further clinical development. Moving forward to 2024 within diabetes care, we expect a decision on approval of insulin ICODEG in Europe, Japan, China, as well as the U. S. during the second half of 2024.

We are also anticipating the exciting results of Combine 1 and Combine 2 from the ICO development program during the initial half of 2024 Of note we are expecting the phase 1 results of the once weekly GLP GIP in the first half of 24 and we have further initiated a phase 1 trial with once monthly GLP GIP during the course of January of 24 We continue to build evidence for the semaglotype molecule within diabetes as well. For subcutaneous semagrotide 1.0 mg, we anticipate the readout of flow for people with type 2 diabetes and chronic kidney disease in the first half of this year. This will be followed by the functional outcome trial stride for people with type 2 diabetes and peripheral artery disease in the second half of 2024.

As for all semaglutide, the cardiovascular outcome study SOLD is expected to be completed in the second half of 2024, investigating semaglutide in people with diabetes and cardiovascular disease. In the obesity area, we expect an FDA decision on the approval of the select data submission in the first half of 2024. Furthermore, we look forward to the first phase 3 readout for CACROSEMA towards the turn of the year. And as a last highlight, we're very excited about the upcoming readout of MyMate Phase 3 in the first half of 2028. MyMate is a novel next-generation factor VIII mimetic antibody with potential for improved patient outcomes and reduced burden of treatment in people with hemophilia.

With that, over to you, Karsten.

Thank you, Martin. Please turn to the next slide. In 2023, our sales grew by 31% in Danish kroner and 36% at constant exchange rates, driven by both operating units. The gross margin increased to 84.6% compared to 83.9% in 2022, driven by a positive product mix following increased sales of injectable GL2-1-based treatments. Costs related to ongoing capacity expansions and negative currency impact and lower realized prices, mainly in the US and region China, partially offset these effects.

Sales and distribution costs increased by 23% in Danish krona and by 26% at constant exchange rates. The increase is driven by both operating units. In North America, operations cost increase is driven by the relaunch of VGOVI and promotional activities for SEMPIC, while in international operations cost increase is driven by promotional activities for Rebelsos as well as obesity care market development activities.

Furthermore, the increase in sales and distribution costs are impacted by adjustment to legal provisions. Research and development costs increased by 35% measured in Danish corona and 37% at constant exchange rates. The increase reflects our strategic objective to expand the pipeline across therapy areas. Specifically, we continue to increase late-stage clinical trial and early research activities. The acquisition of former therapeutics in 2022 and in Versargo Pharma also increased R&D spending. So, administration costs increased by 9% measured in Danish kroner and by 11% at constant exchange rates.

Operating profit increased by 37% measured in Danish kroner and by 44% at constant exchange rates, reflecting the sales growth.

Net financial items showed a gain of 2.1 billion Danish kroner compared to a net loss of around 5.7 billion Danish kroner last year. The effective tax rate is 20.1% in 2023 compared to 19.6% in 2022. Consequently, net profit increased by 51% and diluted earnings per share increased by 52% to 18 kroner and 62 euro. Free cash flow realized in 2023 was 68.3 billion Danish krona compared with 57.4 billion in 2022.

This is in line with the strategic aspiration to deliver attractive capital allocation to shareholders. The cash conversion in 2023 was positively impacted by timing of payment of rebates in the U. S. and provisions related to the revised 340B distribution policy also in the U. S. Capital expenditure for property planning equipment was 25.8 billion Danish krona compared with 12.1 billion in 2022.

This primarily reflects investments in additional capacity for active pharmaceutical ingredient production and for finished capacity for both current and future injectable and oil products. Please go to the next slide. In 2024, we expect to increase our capsule expenditure to around 45 billion Danish kroner. The significant step-up compared to 2023 reflects the expansion of our supply chain. This includes the previously communicated expansions of manufacturing facilities in Kalenborg and Hilogh, located in Denmark, and Charters, based in France. The increase in capital expenditure in 2024 mainly relates to investments in additional capacity for active from true ingredient production and finished capacity for both current and future injectable and oil products across our strategic therapy areas.

In the coming years, the capital expenditure to sales ratio is still expected to be low double digits. Next slide, please. In line with our strategic aspiration to deliver attractive capital allocation to shareholders, we have returned more than 61.7 billion Danish kroner to shareholders via share buybacks and dividends during 2023. At the annual general meeting on March 21st of 2024, the Board of Directors will propose a final dividend of 6 kroner and 40 euro for a total 2023 dividend of 9 kroner and 40 euro, including the interim dividends paid in August of 2023.

This is over a 50% increase compared to 2022, making it the 28th consecutive year with increasing dividend per share. In addition to the dividends, the 30 billion Danish Kroner share buyback for the past 12 months has been concluded.

For 2024, the Board of Directors has approved a new shared repurchase program of up to 20 billion DKK to be executed during the coming 12 months. Next slide, please. We continue the growth momentum in 2024 and expect the sales growth to be between 18% and 26% at constant exchange rates. This is based on several assumptions as described in the company announcements.

The guidance reflects expectations for sales growth in both Nord-Demaric operations and international operations. The sales growth is expected to be mainly driven by volume growth of GH1-based treatment for obesity and diabetes care. With the expectations of continued volume growth and capacity limitations, the outlook also reflects expected continued periodic supply constraints and related drug shortage notifications across a number of products and geographies. We expect that operating profit will grow between 21% and 29% at constant exchange rates.

This primarily reflects the sales growth outlook and continued investments in future and current growth drivers within research, development, and commercial. Our reported sales are expected to be 1 percentage point lower at constant exchange rates, and operating profit is expected to be 2 percentage points lower than at constant exchange rates. For 2024, we expect net financial items to amount to a gain of around 1.3 billion Danish kroner. This mainly reflects gains associated with foreign exchange hedging contracts, as well as interest rate gains from cash and marketable securities. The free cash flow is expected to be between 64 and 74 billion Danish kroner, reflecting the sales growth, a favorable impact from rebates in the U. S. , countered by investments in capital expenditure.

That covers the outlook for 2024. Now back to you, Lars.

Thank you, Karsten. Please turn to the final slide. We are very pleased with the strong performance in 2023, which reflects that more than 40 million people are now benefiting from our innovative diabetes and obesity treatments. We continue to make progress on our strategic aspirations.

In 2024, our focus will be on the continued significant expansion of our production capacity, reaching more patients, and on progressing the expanding pipeline. With that, I would like to hand the word back to Daniel.

Thank you, Lars. Next slide. With that, we are now ready for the Q&A where I kindly ask all participants to limit her or himself to one or maximum two questions. This includes sub-questions. Operator, we are now ready to take the first question.

Yeah, so thank you. Thank you for those questions. First of all, on the once-monthly GLP-1 GIP, honestly speaking, we asked ourselves the same questions when we moved from once-daily to once-weekly, and this is all in the focus of titration. So proper titration will mitigate most GI and tolerability side effects, and therefore we're quite confident that we can manage a once-monthly in that setting. We actually didn't see an increase moving from once-dated to once-weekly, and we don't expect to see that moving from once-weekly to once-monthly. On the emigretin, we're not disclosing phase one data, but you should obviously read into the fact that we are stating that we are progressing further development, which also means that we believe emigretin to be properly differentiated to whatever else is out there.

Thank you, Mike, for the question. Thanks for being up early.

Thank you, Pete. Carsten, two questions for you.

Yeah, so first, as to our 2024 guidance, then the important point is that we are continuing the growth trajectory we showed already in 2023. And just to remind you, 36% sales growth adding to the tune of 5 million people on NOVO's products over 12-month periods. So we do believe that that's significant scaling. And in round numbers, we're talking about that magnitude when you look at our scaling into next year.

So it's a similar type scaling we'll be doing in 2024. I don't like necessarily the logic between multiplying Q4 by 4 because we're in a chronic disease business. So all the ups and downs of currencies and inventories in one quarter makes it dangerous to annualize just based on three months. But again, the growth platforms remain the same. It's Rebelsos, it's Exempic, and it's Vigobi.

And we're scaling all of those three platforms, which is what gives us the guidance that we've provided today. And then as to 340B you right as you state we only partially recognizing 340B revenue and that linked to the accounting standards In order to recognize revenue it has to be what the accountants or the authors call highly probable So that the backdrop behind that And yes, we prevailed in our case back in January of 2023. There are still two cases outstanding in different jurisdictions around the same question. So that would be key informative points for us to decide on how to proceed forward vis-à-vis our accounting recognition in this space.

Thank you, Pete. Thank you, Karsten.

Thank you, Luis. Karsten, I will give the first to you with guidance, and then Martin, later you on MASH.

Yeah, so as always, when we're forecasting, then we take into account demand in the market, competition, and supply capacity. So those factors are what we've weighed into guidance, both in terms of the pricing environment in the U. S. to maintain a high degree of formulary access at PBM basis, And then on the volume basis, I would say that is more a question about supply capacity since we're not competing for share given the magnitude of the markets.

Thank you, Karsten, and over to Martin.

Yeah, thank you very much. So for the ESSENSE NASH study, we expect to see a readout around the turn of the share and then progress towards regulatory finding. I think the FGS-21 study is a phase 2 trial, actually also investigating the effect of cagosemine NASH, and we'll see that read out a little bit later.

Thank you, Martin.

And then the second question on supply, thank you for the color on doubling of the lower Thank you, Sachin. So, Martin, first to you, and then Karsten, you'll take the supply question.

So, thank you very much, Sachin. I'm not sure I'm being vague. We're just saying that we're not communicating Phase 1 data. I think you will hear or see us progress should the data confirm both the subcutaneous but also potentially the oral. The reason why we are pursuing both in phase one is obviously providing optionality. We see a big demand, and we need to provide flexibility and optionality. Having both an oral and a subcutaneous is providing that. When it comes to the efficacy, you've heard us say a number of times, and we'll stay with that, we want to see differentiated products, and that goes for both the subcutaneous and the oral in the marketplace. And what we have seen so far for amicretin brings us confidence that amicretin in both oral and subcutaneous, when we see the data, has that potential.

Yeah, and thank you for the Vigovic question. So to be a little bit more precise vis-a-vis Vigovic, then what we have done is that we have increased our supply of the starter doses by more than double. So that has taken place. And as we have also previously communicated, then we will continue to gradually expand our supply of starter doses as well as all dose strengths. And we will gradually scale that as we are scaling our supply capacity so we have a sustainable supply chain in place, including the necessary inventories to avoid the stop-go pattern that we saw in the past.

Thank you for the questions, and we're ready for the next set of questions.

Thank you, Martin. Karsten, the first question related to the guidance and regional and then later last to you about the portfolio factorizations.

Yeah, so as to the regional dynamics, I'd say these are classic dynamics. When people as yourself have followed the company for an extended period of time, then there will be this type of seasonality. So then talking into 2024, the growth drivers remain the same. Again, Rebelsis, Vigovia, and Osempic. And the real difference, what you saw in 2023 is actually that on GF1 and diabetes, the growth levels were similar, just north of 50%, both in Iowa and North America. So the fundamental difference is the pace of Vigovie rollout. And of course, North America are rolling ahead of I. O. , but it is important to note that we will be launching in additional I. O. markets in the volume cap way for Vigovie into 2024.

But you should expect North America still to be rolling at a higher pace than I. O. Thank you, Kirsten.

Last over to you.

Thank you, Martin. On portfolio participation, I think you should see us as being committed to people living with diabetes and in need of insulin. When we look at Levemir, specifically in the U. S. , we have a situation where we have, you know, Taseba as well. We will be launching a weekly, our weekly insulin. And we also see dynamics where we have lost a contract on Levene. So for us to stay committed to patients is also leading to us then thinking carefully about what are the most, say, optimal ways of treating those patients with the most efficacious products. And on GL4-1, there's also the optimization in moving patients from daily treatment to weekly treatment, where you get higher efficacy and obviously easier to produce presentation as you reduce the number of injections and presentations needed.

So we are going to be, say, having a social responsibility vis-a-vis the patients while still optimizing to a degree where it both benefits patients and our ability to scale.

Thank you, Lars. Thank you, Martin.

Thank you, Richard. And, Doc, I'll give the word to you for select pair discussions, what you can say, and then also competitive dynamics and diabetes.

Yeah, thank you for the question, Richard. Really appreciate it. So, just to reiterate, you know, we're super excited about the potential of select data, and we do eagerly await the hopeful label update in the coming months. And, you know, we're doing our normal preparation for that. When we think about what that means, certainly for Part D access, you know, we're hopeful that SELECT can unlock some of that access. But, you know, in the end, even with the excellent data, it's likely not going to happen overnight. But, you know, in the end, we believe that SELECT can set SEMA 2.4 milligram apart as the first and only AOM, showing a consistent benefit across endpoints, including MACE.

So, you know, we're super excited about that. And the second part, Doc, of the question with regards to competitive dynamics in the GLP-1 diabetes space.

Yeah, so overall, you know, we see a stable competitive environment. Obviously, as we see an increase in volume, we should expect to see also a decrease in price over time. As a product, it's larger in the marketplace. But again, it's a stable competitive environment that we have.

Thank you, Doug. Thank you, Richard, for the questions.

Thank you, Harry. So, Doc, any comments to formulary status for key products? And then the stay time I will give to Camilla.

Thanks, Harry. So overall, we don't see any major change to formula status for GLP-1s. And if, again, you recall, we have more than 90% unrestricted access, so very favorable access, and we see that largely unchanged in 2024 this year.

Good. And on stay time, what we can say is that we generally see better stay time on VGOVI than what we've seen on previous angiobesity treatment like Saxenda. So we basically see fewer patients dropping out. It's still early days for Vigovie because of the interrupted supply in the countries, but we can also say that both in the U. S. but also in Denmark, we see strong indications that the stay time is longer for Vigovie. And especially in Denmark, we see the majority of the patients who initiated treatment in the beginning of last year, they stayed on the treatment throughout the year. And on OSMPIC, generally, we see a continued long stay time in the tune of four to five years.

So there's been no major changes to that.

Thank you, Camilla and Doc. And thanks for the question, Harry.

Thank you, Emily. The time was a bit bad, but I think we got your question. So, Carsten, any call on the guiding ranges and then later dock coverage of Vigobi in the U. S.?

Thank you for that question, Emily. And yes, you're correct. Guidance ranges are much broader than what they had normally been at this point in time. And of course, the plan is to narrow guidance ranges over the years as time progresses. The reason why we chosen to broaden them slightly is basically the dynamics we seen over the past quarters in 2023 and even in 2022 So a dynamic market and constrained supply and growth to net adjustments linked to the U growth to net model So fundamentally, there are no major fundamental changes to what we've seen in prior quarters. We just felt that it was prudent at the beginning of the year to start out with a much wider guidance ranges.

Thank you, Karsten. And Doc, comments on coverage for Vigovie in the U. S. and employer opt-in?

Yep, thanks, Emily. So we still continue to enjoy broad market access for Vigovie. That's over 90%, and as we've communicated, that equates to around 50 million people living with obesity who are now covered. And overall, there will be opt-ins and opt-outs, but we continue to see improvements in the net coverage. So our focus will be continuing to secure coverage over time and to keep continuing to grow the volume market. But overall, we're pleased with the level of access that we have and looking forward to improving that over time.

Thank you so much, Doc, and thanks, Emily, for the questions.

Thank you, Seamus, for these questions. Martin, I'll give the word to you.

Yeah, thank you very much. So first of all, on the once monthly, as you obviously know, this is phase one, and this is one of a number of tracks that we are pursuing in this space. It's a technology that we cannot share at this point in time, but broadly speaking, we are confident and happy with our research progress in this space. And obviously, we will not take assets into phase one without a level of confidence in their broad applicability and success.

On the WOMAC, the sort of broad applicability is that if you see a 35-point change from baseline, you are in the very clinically relevant space. And here we saw a 41-point improvement. In terms of concomitant medication, this was allowed, but this is specifically why we have a control group in the study. You actually also saw improvement in the placebo arm, but the improvement seen with semanglutide was above and beyond that and in the space of being statistically significant as well as clinically relevant.

Thank you so much, Martin, and thanks. Seamus, next question, please.

So first, Carsten Kevix.

Yeah, so Simon, just reframing your question slightly, because taking a point estimate and making it into a time series, I don't think is necessarily the optimal way. So I would say because a good chunk of the CAPEX we will be spending this year will be on projects we already initiated in 23 or earlier. So as you've noted, then we have announced CAPEX just in 23 to the tune of 75 billion over the lifetime of these projects. So those are, of course, a key element of the 45 billion. So in terms of when coming on stream, it will be gradually over time on API, which are some of the bigger ticket items. We'll see API coming on stream already from additional API capacity coming on stream already from 2025.

And then there will be different capacities coming online pretty much every year from there on across our manufacturing footprints.

Thank you, Carsten, and thank you, Simon. With regards to the recent collaboration, then at this point in time, we don't have too much to add, but I will use the opportunity to do a bit of advertisement for our upcoming Capital Markets Day, We will talk more about these early research partnerships, and then we will be happy to address that.

So, Vigobi, over to you, Karsten and Martin, later outcome trials for future obesity pipeline products.

Yeah, hi, Mark. So, as to Vigobi and CMO filling, what I can say is that we are on track with what we previously communicated with the three CMO lines. We don't think it's prudent to continue to specify number of lines and locations and potentially CMOs, just to say that we will continue to expand capacities in the years to come, given the significant unmet need we're seeing. So, unfortunately, then you will have to impute from our guidance into our scalability how we are scaling our supply.

And specifically on the cardiovascular benefits of our pipeline products vis-a-vis of Magrotype. What we, for example, know from Cagrysema, and right now we have to rely on biomarkers, is that Cagrysema is obviously superior on body weight or has the potential to be superior on glycemic control, But also will be superior on, for example, blood pressure lowering, lipid lowering, and potentially other very relevant cardiovascular biomarkers.

All of that gives us a lot of confidence in that Cagrysema will be associated with a quite profound benefit in the cardiovascular space. But obviously, we had to show that in phase three. And as you know, we are currently running the redefined free study to that effect.

Thank you, Martin, and thank you, Mark.

Karsten, over to you.

Yeah, so thanks, Richard, for those questions. So as to the guidance range, then it's important to illustrate this is the most realistic outlook that we're providing to the markets. So had we thought that we could grow faster than this realistically, then we wouldn't have been providing this guidance at this point in time. So, this is what you should expect on, and as a normal distribution, then expect something around the mid of the range. That's how we work on this. And then it's important to note that being in a supply-constrained environment, then it's very important for us in order to manage our business in a way that we focus on our supply chain and ensure that it's resilient so we don't get into some of the bumps that we saw in the past with the stop-go type decisions.

So it's important that we have a sustainable supply chain. So that factors in also. So most likely range, and of course, our job is to run the company in the best possible manner, and that entails driving top-line growth as well as having a resilient supply chain set up. Then as to scaling of FlexTouch, which you can say entails both cartridge filling, assembly and pack, I can only say that we're scaling all of those on an ongoing basis. So we have active projects in each of these areas.

We don't want to get into details externally around project plans and so on, but I would point you to our recently announced expansion in Sharjah of some 16 billion DKK, which taps directly into expanding that pipeline just as an example of a significant CapEx project to that extent.

Thank you, Richard, for the questions that you've asked.

Good. Martin, any brief comment on amicretin?

Yeah, so very high-level short answers, yes. Obviously, if we have the aspiration to have differentiated products, amicretin, oral amicretin has to be in the range of where we see efficacy and safety with Cagrosimma.

Thank you, Martin. And, Doc, over to you. Any comments on our competitive commercial strategy in light of a competitor movement?

What I would say is, I bring it back to us and say, you know, we believe in the foundation that we have in NOVO Care, and there's lots of elements to that. So we'll continue to stay focused on that, and I appreciate the question.

Thank you, Michael. Thank you, Doug, for the answer.

Thank you, Daniel, and also thank you from me for participating today. I hope it's clear that we are very pleased with our performance in the past year and equally excited about what we can do in 2024 based on the attractive guidance range we have put forward. A lot of focus on scaling capacities with some real tangible backing of our scaling in the form of now more than doubling the start doses in the U. S. , and we look to continuously expand our capacity.

And equally important, the expansion of our pipeline and really doubling down on our strongholds in diabetes, obesity, but also increasingly cardiovascular disease and rare blood disorders. So we are excited about how the pipeline is shaping up. So thank you all for your attention today, and we look forward to seeing you in the near future. Bye-bye.