諾和諾德 (NVO) 2020 Q3 法說會逐字稿

Hello, and welcome to the Q3 2020 Novo Nordisk A/S Earnings Presentation. (Operator Instructions) Today I am pleased to present Karsten Munk Knudsen. Please go ahead with your meeting.

Thank you. And welcome to the Novo Nordisk third quarter results meeting. It's a pleasure to host this meeting, and a big thanks to Richard Vosser and JPMorgan for helping setting up this meeting. So for the meeting today, we have an update on our strategic aspirations, followed by COVID-19, commercial execution, innovation and therapeutic focus and financials. So organized in line with our strategic aspiration framework. We have planned it in a way. So the presentations will be followed by a Q&A session in the end.

As you all know, then statements around the future inherently are covered by a certain level of uncertainty. And hence, we remind you about this circumstance.

Moving on to our strategic aspirations. Then more or less 12 months ago, we replaced our previous long-term financial targets, which were focused on growth in operating profit and the core financial performance. We replaced that with our strategic aspirations, which provides a more holistic view on the progress and performance of the company.

The first quarter, I would point your attention to is purpose and sustainability, where we are driving our new Defeat Diabetes social responsibility strategy. We work a lot with affordability. We've previously talked around U.S. affordability offerings. And in the third quarter, we have adjusted our affordability offering across international operations, where we have lowered the ceiling price for human insulin in 76 low- and middle-income countries.

On the environmental agenda, we continue to drive our circular for 0 strategy, reducing our CO2 footprint and generally reducing our impact on the environment. We are at 100% renewable power across production already. And in the third quarter, we launched a target for our suppliers also to reach 100% renewable power, but only by 2030.

Innovation and therapeutic focus, I will leave that to Mads Krogsgaard Thomsen to go through that in a few slides time. But clearly, you see the progress, both in our insulin business, our GLP-1 business in diabetes as well as solid readouts in obesity, especially in the second quarter of this year.

And finally, we had a Phase IIb readout for ziltivekimab in the third trial that Mads will come back to later.

On commercial execution, we increased our diabetes care sales by 8% on a year-to-date basis. And our diabetes value market share has now reached 29.2% and 80 basis points increase compared to 12 months ago. This is predominantly driven by our GLP-1 business, which grew 29% during the first 9 months.

Obesity grew by 6%, impacted by COVID-19 and biopharm sales increased by 4%, driven by IO. All of this led to a group sales growth of 7% and operating profit growth of 7% and free cash flow that increased 27% to DKK 41.6 billion and DKK 31 billion of cash returned to shareholders during the first 9 months.

COVID-19 is impacting societies across the globe, and it's also impacting Novo Nordisk, and briefly covering then our manufacturing sites are operational across the globe, and we're able to supply medicines to all markets globally. In R&D, we have all our trials running. Recruitment is impacted albeit running at, I'd say, index 70 or so compared to pre COVID, and we are now also able to initiate new trials.

In commercial, we've seen a recovery on new patient starts. You see that on the right-hand of the slide. And we have a sales rep in the market in many of our geographies. Furthermore, we are more and more using digital tools to communicate and interact with our stakeholders in the field and in the markets.

Our sales growth, when we look at it on the key dimensions, you see that our sales growth is driven by -- on a geographic point of view, it's driven by 12% sales growth in International Operations. And within International Operations, we see very solid sales growth across both EMEA, China and rest of world, all being at double-digit sales growth. The sources of growth are slightly different, but the key growth is coming from insulin and GLP-1 in aggregate across International Operations. And you should note that the 12% compares to the 6% to 10% that we set out in our strategic aspirations last year.

And talking about strategic aspirations. In North America, operations growing 2% and as we've been communicating, then we are transforming our portfolio from insulin towards GLP-1, which is what you see in the stacked bars with the red bar now significantly bigger than the dark blue insulin bar. And that's also visible in terms of growth, where you see that in terms of therapy areas, you see that GLP-1 driving 29% growth and solid growth both in IO and North America operations. So GLP-1 truly being the growth driver of the company in the first 9 months. Obesity impacted by COVID-19 and a solid 4% growth in International Operations -- sorry, in biopharm, mainly driven by our human growth hormone franchise.

And with that, I'll hand it over to Camilla Sylvest to give an update on the market performance.

Thank you, Karsten. And if we look at our diabetes value market leadership -- market share leadership, it continues to expand. It is now at 29.2%. It has increased 0.8 percentage points since the same time last year. This is driven both by GLP-1 market share that has increased around 3 percentage points versus 2019 and primarily driven by the rollout of Ozempic, that is now available in 48 countries.

The uptake of Ozempic and launch of Rybelsus in North America (inaudible) of course, also significantly contribute to the growth in market share.

Also in insulin, we have increased our market share to now 44.5% from 44.3% same time last year. This is mainly driven by a market fit approach in international operations and the launch of our new-generation insulins. If we look at the details of our GLP-1 market shares, we see on the left-hand side here, the U.S. GLP-1 NBRx market share, where we now see Ozempic at 13.5 -- sorry, Rybelsus at 13.5 percentage points. And a total GLP-1 Novo Nordisk market share of 60.2% NBRx.

On the right-hand side, we see the total TRx market share, where we now have 49.6% market share, and Rybelsus has increased to 3.7% with Ozempic to almost 27%. The uptake of Rybelsus we have here in this slide compared to the uptake of SGLT2s in the U.S., exemplified canagliflozin and empagliflozin. And here you see that the uptake of Rybelsus is now at least on par with a small dip in the COVID-19 period. But we now have 85% access across Commercial and Medicare, and we have more than 80% of new prescriptions new to the GLP-1 class.

We've also initiated our new Rybelsus D2C campaign a little more than a month ago. And this is also picking up nicely, and we are seeing a continued flow of patients going into rybelsus.com.

Outside of the U.S., Rybelsus has now been launched in 8 countries with market access. In International Operations, we see continued growth across all the regions and geographical areas as well as both in insulin and GLP-1. Especially in EMEA region, the GLP-1 is a significant size, and it's also having a relatively big growth rate in China and the rest of the world. In total IO is growing 13%.

On the right-hand side, we see the diabetes value market share in IO, specified by the 22.7%, that is an increase of 0.7% versus last year, but we also see the Novo Nordisk share of growth that has now increased to 30%. In the obesity area, we see Saxenda sales growing 6%, impacted by COVID-19 due to fewer patients being initiated. And Saxenda is now launched in 54 countries with a market share of Novo Nordisk to 63%. And hereof, we have an IO 40% market share. And in North America, 78% market share. And the uptake of the reported sales is relative 2/3 in North America and 1/3 in IO in the last quarter.

And now I will hand over to Ludovic for the update on biopharm.

Thank very much, Camilla. So biopharm growth for the first 9 months of the year were 4%, driven by Norditropin and the launch of the new hemophilia products. If we look at the sales more precisely, the growth of 8% in the International Operations fueled the overall 4% growth in the 3 first quarters of the year with a strong impact of Norditropin.

The hemophilia sales decreased by 2%, whereas the successful launch of Esperoct and Refixia are countering the NovoSeven sales decline driven by less procedures and elective surgeries across the world. Norditropin sales increased by 13% on the basis of higher sales driven by logistics and supply issues from competitors as well as an increased efficacy from a commercial perspective.

Novo Nordisk is now the leading company in the global human growth disorder market with a value market share of 35.3%.

Let's move now to [science] and zilti. Mads?

Thank you, Ludo. So we will actually move directly into the product that became part of the acquisition of the Corvidia Therapeutics company, namely the fully human monoclonal antibody against the interleukin 6 ligand. We believe that this holds a great potential within atherosclerotic cardiovascular disease, where there is a residual risk that is unrelated to lipids and blood pressure and platelets and so on, but it's rather related to the inflammation that occurs in the cardiovascular system in ASCVD.

And in particular, if you also have concomitant chronic kidney disease, so we here have an enriched population with a presumably high event rate of major adverse cardiovascular events. And what we targeted in the RESCUE Phase IIb trial was to investigate zilti's action on markers of inflammation, biomarkers of inflammation such as high sensitive CRP, serum amyloid A, fibrinogen and haptoglobin. And in each of the cases, you can, as evidenced on this slide, see that there was a fast and sustained and dose-dependent reduction in the biomarkers of inflammation as evidenced by CRP on this one.

Whilst we, at the same time, did not see the typical IL-6 blockade side effects or adverse events, such as clinically meaningful neutropenias, thrombocytopenias, transaminase elevations or for that matter, cholesterol innovation.

So overall, a very nice benefit risk assessment based on this Phase IIb trial, and we are now happy to announce that we will, during the course of the second half of next year, initiate in the same target population, a big phase 3a cardiovascular outcome trial with zilti.

So many things have actually happened over the last quarter or so and will happen in the next quarters. And regarding Ozempic, we are awaiting the SUSTAIN FORTE 2 milligram results that will lead to a submission in major markets as soon as possible thereafter. I would also like to mention the glucose sensitive insulin the holy grail of insulin therapy that we have now entered into clinical trials with the first of these molecules and maybe also just highlight that all semaglutide Rybelsus has now initiated a clinical program with a higher doses compared to the 7 and 14 that we today have on the market.

When it comes to obesity, we're looking very much forward, choosing the PRV voucher in the U.S. submission that will take place very imminently followed by European submission and hopefully launch in the U.S. as the first market already around mid next year or immediately thereafter. We also hope to initiate Phase III program for the joint combo of the Amylin 833 and the SEMA 2.4 towards the end of next year.

Within biopharm, we are happy that Ludo has gotten Sogroya somapacitan the once-weekly growth hormone approved in the U.S., and we are awaiting action with the European regulators in the near-term future. And also, we are happy that we were able to come up with a revised dosing regimen for the pan-segment antibody against hemophilia known as concizumab. And that has been reinitiated in Phase III.

I'd also just highlight that we actually have started dosing -- subchronic dosing with Mim8 in Phase II in patients with hemophilia A with or without inhibitors.

And finally, on other serious chronic diseases, we're extremely happy that semaglutide in the NASH indication was awarded breakthrough designation by the U.S. regulator and will be followed by Phase III initiation as soon as possible next year. And zilti, we've already spoken about.

So without further ado, over to an update on the financials and that's you, Karsten.

Thank you, Mads. So as I started out mentioning 7% sales growth and 10% profit growth on a year-to-date basis and also for the quarter in isolation. We are continuing to invest in our business in terms of sales and distribution costs with the 5% constant exchange rate growth versus 12% growth in R&D costs. The 12% are impacted by the amortization of a priority review voucher that we have informed the FDA that we'll be using in conjunction with the regulatory review of semaglutide 2.4 in the U.S.

As for our outlook as stated in early October, then we have raised our outlook to 5% to 8% top line growth and 5% to 8% operating profit growth. Currency impact is 3% negative impact on sales linked to the lower U.S. dollar and around 4% negative impact on operating profit. While financial items are now at a loss of DKK 1.4 billion versus DKK 1.2 billion in August, linked to a deterioration of certain emerging market currencies. Free cash flow is now at -- between DKK 34 billion and DKK 39 billion up DKK 1 billion compared to our Q2 guidance linked to the upgraded profit outlook I just went through.

So this concludes our presentation for the third quarter performance. And this slide, just to remind you around our strategic aspirations and what we're pursuing against 2025.

And with this, I will hand it over to the operator to initiate the Q&A.

(Operator Instructions) Our first question comes from the line of Richard Vosser from JPMorgan.

Maybe I could do 3, please, if possible. So firstly, you talked on Friday about the outlook for 2021 in broad terms. But maybe you could give us a little bit more help on pricing pressure you anticipate across the different insulins in the U.S. and outside the U.S. and in particular, how you see the impact of semaglutide on the basal insulin space. And possibly as well, how we should think about the GLP-1 pricing situation next year relative to this year?

Second question, just on the COVID impact. Just your latest picture on new patient starts throughout Europe as the second wave intensifies. Just your view on how that impact is relative to the first wave. Is it smaller and how you think the lockdowns might impact you as they come through?

And then third question, just on the nausea or the GI profiles in the STEP trials. I think, Mads, you mentioned the discontinuation rates are low. But if you could maybe give us an idea how the nausea and vomiting levels are in the STEP trials relative to what we know of the profile of Ozempic and how then that -- the titration profile in the STEP trials might be different to the SUSTAIN forte trial so that we can have a bit of a thought there?

Thank you, Richard. So I'll start out with the first 2 questions and then Mads on nausea. So Richard, talking about 2021 then we're not providing this level of granularity on our guidance at this point in time. So you will have to wait until February to get more detailed commentary. That I will say is, as we talked about before, that we see rapid growth in GLP-1. However, the competitive situation is stable between us and one competitor.

So our focus is to continue to drive growth in the GLP-1 segment and have open access in that segment. As to COVID-19 impact in Europe, it's kind of something that evolves day by day or week by week. We don't have very detailed data in terms of impact on the diabetes market in Europe compared to what we have, for instance, in U.S.

I would say, anecdotally, what we hear, for instance, in Sweden, where they have more data granularity, there as of last week, we heard that diabetes patient visits into Swedish clinics were down some 30% or so compared to pre COVID. We do believe that compared to Q2, then, albeit we have a lockdown then societies have learned better how to manage through a lockdown and keep certain wheels running at the same time.

But of course, tough lockdowns will impact patient flows to some extent. And then I'd furthermore, add that when you look at our prescription trends and sales trends, both across geographies then we've seen a high level of resilience in our TRx curves and our sales performance. So of course, an impact from fewer new patient initiations, but very high resilience on the continued patient performance.

And then over to you, Mads, on nausea?

Yes, well, first of all...

Speakers, we can't hear you. Are you on mute?

Sorry, I was. So I'll just repeat, vis-à-vis the titration within diabetes and obesity, for obesity sema 2.4 is done via titration over 0.25 to 5, 0.5 to 1.0 via 1.7 milligram to 2.4. But for diabetes and SUSTAIN FORTE, we go directly from 1.0 to 2.0 milligrams without an intermediate dose. So that's on the titration regimen, and it is based on prior evidence of high and consistent tolerability towards GI side effects with this dosing regimen and titration regimen.

Vis-à-vis, the absolute numbers, you are aware that you see mild to moderate occurrence of nausea. Typically, [within the ramp] during the titration phase, of up to, let's say, 15%, 20% reporting in any given week on a mile to moderate basis. And then that wanes over time as we hit the target dose, such that when you're in steady state after, let's say, a year or so, you have a total of 1 out of 10 patients reporting in a given week mild to moderate nausea. And for the other GI tolerability issues, diarrhea, constipation and so on, the numbers are much lower. Much lower actually. So that's what it looks. And we believe, hence, we found a very tolerable dosing regimen for semaglutide, whether it is in diabetes, obesity or of that matter NASH and we don't really comment on the other products from the other companies. Time and data will, of course, show how they stack up.

And the next question comes from the line of Michael Leuchten from UBS.

Three questions, please. One, Camilla. I was just wondering if you could go back to your commentary around Rybelsus access in the U.S. I think you said 50% of patients are still benefiting from the $10 access program. How do we think about this phasing out over the next couple of quarters? Is there a firm deadline? Can you extend it and as that rolls into a co-pay assistance program, what does that do to dynamics, if anything?

Second question just interested on your reduction of the ceiling price of human insulins. Just how do you benchmark it, why did you decide to do that now? It's obviously very applaudable, but interested in your thinking on timing here? And then thirdly, just Mads on concizumab. I think you said you've changed the dosing to be allowed to restart the trial. I just wondered if you could give us a bit of color of what you had to change?

Great. Thank you, Michael. So the first 2 for you, Camilla on Rybelsus access and more use of co-pay programs at 50%, ceiling price benchmark and then concizumab for Mads.

Yes. Thank you, Karsten. On Rybelsus access, we talked about the other day that there is, of course, a movement over time in terms of what we call clean scripts and what -- the co-pay or voucher scripts. And this development in principle takes place with the access that we gained over the years. So we have seen -- and I mentioned the other day that we are now at around 50%, what is clean scripts and what is the voucher co-pay scripts. Earlier in the year, of course, we were at a different starting point. So as we gradually gain access, you should expect that we get up to the level of the access that we have, so approximately around 85%.

So this is the movement that is taking place at the moment. Then on ceiling price for human insulin, this was really one of the first initiatives that we've launched as part of our new social responsibility strategy. We launched end May called Defeat Diabetes. Defeat Diabetes has innovation as the core contribution to society, but we also realize that not every patient get access to our innovations. So access and affordability is a big part of our defeat diabetes strategy and the ceiling price for the low and middle-income countries, in 76 countries where we have lowered the price has really been benchmarked up against where were we and what would make a meaningful access to those patients. And we are talking about approximately 2.9 million patients that, in principle, would get -- benefit from this. This, of course, also means that the local government needs to apply this in their tenders, but that is what we are working with them on at the moment. So that's the background for that. The last element in our the defeat diabetes strategy is prevention. Well, we can talk about that another time.

Great and over to you Mads?

Yes. No. So what happened was we saw 3 cases of nonfatal thrombotic events early this year, that led us to the clinical hold in March of this year. That was then followed up by interactions with the regulators very diligently such that the FDA and other regulators allowed us to resume with a revised dosing regimen, both actually for concizumab but also for the on-demand treatment of bleeding episodes in a way that based of our investigation of the individual patients allows us to do so, we believe, safely going forward.

And also, we are able to, you can say, monitor the coagulant status of these patients. So we think we are in a good situation and not all, but almost all of the patients have resumed in the Explorer Phase III program.

And the next question comes from the line of Peter Welford from Jefferies.

I've got 2. Firstly, for Mads. I wonder if you could comment at all on the NASH late-breaking abstract (inaudible) with the Gilead combination molecules. We can see data there of regards to some of the biomarker data. I wonder any comment on that relative to the Phase II NASH data that you've obviously already presented for sema and particularly as well about the tolerability as well of semaglutide together with the Gilead small molecules and how you think about going forward for the NASH indication, if possible?

And secondly, another one, I think, for Mads, just on Mim8, I didn't catch quite what you said, just with regards to the Phase II. Are we yet at therapeutic doses? And will we use therapeutic doses? Or is this initial study just looking at sort of PK/PD with subtherapeutic doses, and there'll be another study looking at therapeutic doses before we move forward?

Great. Thank you, Peter. So Mads, first question on the combo versus monotherapy, CNS. And the second one, on the Mim8 dosages.

Well, so first of all -- I can, first of all, confirm that semaglutide, both in our own biopsy-based Phase IIb trial but also in the one that you will see announced in the combination between the FXR agonist and the ACC inhibitor alone and together in conjunction with semaglutide prove the point that semaglutide has a high level of efficacy based on either biopsies and in this case, on biomarkers, with the addition of one or both of the Gilead compounds, there are, of course, data coming out very, very soon.

And I don't think it would be too pertinent of me to comment specifically on that because we're in a partnership with Gilead. We will have those data announced very, very soon at the conference, as you mentioned, and then we will discuss the path forward with our strategic partner, Gilead, in that regard. But overall, I think it's nice to see the confirmation of semaglutide's efficacy based on different readouts in the NASH condition.

Also tolerability wise, I can just say that there were no big issues in these trials, but you will hear more about that soon. With regard to Mim8, we actually have the situation that the single ascending dose study in healthy volunteers has shown us what we believe to be an expected efficacious dosing range that we are now investigating. So these are clinically therapeutic dosages. It's a classic dose range finding subchronic study that will guide us towards the Phase III trial that we hope we'll be able to run in during the latter part of the next year.

So we believe we have a next-generation factory limiting antibody. And of course, we will look forward to sharing data as they emerge.

Sorry, can I just follow-up briefly on the NASH. Just -- can you make any comments at all on the choice of oral? Because I noticed that Gilead, I think, is using a weekly Ozempic like regimen, whereas on the other hand, I think your own study used the daily oral. Any thoughts there on -- with regards to the optimal choice for NASH going forward?

Well, semaglutide will always be a once-weekly application via the injectable version. I am aware of what we did in Phase IIb for historical reasons. But in Phase III, we're moving with a classic dosing regimen that will make people reduce both the inflammatory status and the steatosis status I hope in the liver with a therapeutic dose of once-weekly semaglutide. I won't comment on the other combination partners until -- and if it comes to that.

Next question comes from the line of Sachin Jain from Bank of America.

Sachin Jain, Bank for America. Two, if I may. One for Camilla. You very kindly on Friday discussed some obesity sort of commercial program and outlined just sort of 4 objectives. My question was what really unlocks the payer and patient market. Is the weight loss that you see with sema which roughly doubles [Saxenda] enough for that conversion, would you need to select any AM833 type weight loss to really unlock this market?

The reason for the question is CMD a couple of years back when you're asked about your aspirational peak sales, one of the things that came out of that time was that SELECT was really required to unlock this market. So I wondered if that is still the case, what's the thought process evolved a little bit since then?

Second question for Mads on the sema -- sorry, the Rybelsus higher dosing Phase I. Can you just remind us of the regulatory pathway there? And what exactly is required at these higher doses (inaudible) that would be great?

Thanks, Sachin. So first for Camilla on reimbursement in -- for Sema obesity and what triggers that? And for Mads, the high dose and the regulatory process forward?

Yes. Thank you. So on the reimbursement and what really triggers that, what we have seen now is the -- of course, the weight loss has a big impact, but already now with Saxenda, which has half of the weight loss that we have seen now with semaglutide 2.4. We have obtained reimbursement in selected countries. And most recently, as you know, with NICE that has recommended Saxenda for use in a specific patient population.

So what has been important in that type of process is the health economic modeling of the long-term outcomes related to weight loss. And it's very clear that a big part of the patients living with obesity would have severe comorbidities, like cardiovascular risk, like -- or cardiovascular problems, like diabetes and like some types of cancer. And when you model all of that into a health economic model, you're able to show the benefits of keeping the weight down to a level below BMI of 30.

And so that has been what we have used in -- as part of our health economic modeling. We have a new model that actually takes all of this into account. Having said that, of course, the SELECT study will also prove very valuable to show and realize what some of this modeling -- these modeling assumptions that we're applying now, how we can verify those. So SELECT will still be important but we already now can model most of the implications. And we know from Canadian studies that obesity-related complications and costs can take up to 10% of the health care spend. So it's really something that payers and policymakers are interested in seeing how they can lower.

And then Sachin, when it comes to high-dose Rybelsus, I'll just remind you of the discussion we had with you maybe at ADA last year, where we stated that we had been in a good and constructive regulatory dialogue with, among others the FDA, following which we could conclude that we would increasingly be able to bridge between oral all and injectable versions of the semaglutide molecule if and when we could show that exposure was at the same level for each time we had a discussion about one or the other products.

And the reason why I mentioned that is that with high-dose Rybelsus, we will be operating in a range of exposure that we either have done or are doing also with the injectable counterpart of semaglutide, which actually enables us to have a slim program towards approval of higher doses, this is the no molecular entity. It's a known level of exposure. It's a known safe and tolerability profile.

So what you typically can do is one kind of pivotal trial not necessarily a huge one, but one that can provide the indication for the new and higher dose. And if for some reason, you were to have a formulation that has different characteristics compared to the original Rybelsus formulation, one would do a clinical pharmacological bridging study to show that the equivalent dose corresponding to a given dose of the old formulation that is present in the new formulation is modified by so and so and so and that -- you then show that they are bioequivalent, so to speak.

So if I could just push you for filing -- rough filing comments that sounds sort of like '23, '24? Or is it potentially earlier than that?

So I think we will not comment on the filing at this point in time, only that we started this Phase I, which we were happy to announce.

Next question comes from the line of Keyur Parekh from Goldman Sachs.

Karsten, 2 clarifications from your comments on Friday and then one for Mads. The first one was, as you talk about the transformation of the U.S. (inaudible) comes from the older products you had to the newer products like kind of your GLP-1 franchise, logically, that should translate to the growth rate moving higher.

So just wondering if there was anything I was logically missing in that assumption, if so would be great to hear your perspectives to it. Secondly, I think you laid down multiple kind of details on how you see the cost lines growing into next year, which was helpful but again, in the context of the growth outlook, I wonder if you might be able to comment whether you expect kind of 2021 operating margins to be broadly similar to 2020. Meaningfully lower than 2020? Anything there would be helpful. And then secondly, Mads, as you look at initiating multiple kind of large Phase III studies into next year, is there anything you can do from a platform perspective or kind of from an R&D recruitment perspective that can either help you think about scaling up, lowering cost of those recruitments or quickening the enrollment for those?

Great. Thank you, Keyur. I'll take the first 2021 questions and then Mads, you on the R&D clinical trial recruitment.

So Keyur -- in terms of the U.S. transformation, then the 70% we've set out to transform to launch -- products launched after 2015 by 2022, we're roughly at 50% now. And what you can see is that our U.S. insulin business is less of weight compared to what it was. So our U.S. insulin business is now some 13% of group sales.

So of course, continuing to be impacted by pricing pressures, but the size of the business is smaller. So from that point of view, you can say future impact on U.S. pricing, everything else equal would be less. I have to remind you, as you know, that we are providing our guidance come February. So this is just the building blocks that I provided last week, and the transformation is nothing new on that. And actually, the same goes for the cost lines.

And it's important to note that we are pursuing a growth based strategy, and we are investing in driving growth of our franchise, both in the the short, medium term, but also investing in future growth platforms in R&D. So that's a strategic backdrop between my comments on Friday. So I think at this point in time, we have a unique opportunity between the top line growth we have and thereby being able to invest both in realizing the top line growth through launches, while at the same time, ensuring that we have future product platforms and technology platforms that will yield growth in the long term for investors.

So I think strategically, this is perfectly kind of the sensible way of running our business at this point in time. And in reality, nothing new in direction of communication from the company compared to what we've said at least since the Capital Markets Day.

And then over to you Mads, on the clinical trial recruitments.

Yes. Well, first of all, Keyur, a couple of more generic statements surrounding the way that Dr. Martin Lange and his crew in the global development organization are conducting our trials. You are aware that unlike most companies, we do not use a lot of CROs. We predominantly have our own clinical research associates all over the world in close dialogue with investigators and knowing which sites work and which don't and so on.

So 2 things have prompted us to change the way we conduct our global clinical trial development or clinical development. One was the notion that we had to move from around 16,000 patients in trials just 1.5 years ago to today more than 40,000 and a bit more than a year from now, more than 50,000 patients, how to do that without tripling the cost of clinical development.

Well, we've done 2 things. We are kind of leveraging the fact that we are an independent organization that has all the tools and the puzzles to the jigsaw, so to speak, to play around with and elements in enhancing our productivity have included, but are not limited to having our clinical research associates do a lot more of their work, monitoring, source data verification, et cetera, et cetera remotely.

So they are no longer -- they can do that electronically. They don't have to do every single time and visit to the investigator to check up on the temperature in the fridge or whatever. So a lot of optimization has happened and is happening on an ongoing basis there that enhances productivity. But then also, we have prepared for the COVID-19 situation by digitizing a lot of the work we do, including the interface between the company, the patient and the physician or the company, the physician and the physician and the patient, such that we can really do a lot of almost virtual trials as we speak, and they will be more fully virtualized over time.

So we are rendering ourselves less susceptible to a second, third wave of COVID-19, whilst at the same time, having optimized the productivity, something that is difficult to do if you work too much with CROs because then you are dependent on their systems playing together with your systems, and we can develop all of this ourselves. And I actually have a team in early research in Seattle that is helping out doing some of the work so that we're also ready for the Phase III program, for instance, for insulin icodec to tease out whole new benefits of the molecule with the latest advent of digital technology.

The next question comes from the line of Mark Purcell from Morgan Stanley.

The first one is on positioning of zilti. I guess this one's for you Mads. Can you help us understand the development program you're going to start here? I'm just sort of thinking CV disease obviously remains an underdiagnosed and under treated in patients with CKD. But you could maybe start with hemodialysis where you have event rates in terms of MACE of 20 per 100-patient years and start there as a specialist product.

And then that could chime in with Ludovic in terms of his previous experience in bringing in his inhibitors and other sort of hemodialysis target agents as well? Or is this going to be more of a broad gem map -- is gen med approach and therefore probably warrant doing some prevalence trials to look at some of the biomarkers you mentioned in terms of the relevance as you do your CV outcome study. So be really interested in terms of positioning there.

The second one was in terms of Saxenda in the U.K., could you just help us understand the price reduction that you offered tonight and this specific patient population that you've got the recommendation in? Just wondering, Camilla, is that a guide to how Sema may be positioned in the future? And then third, in terms of Rybelsus and pricing -- and net pricing more specifically, should we just sort of broadly think that this product will be priced more or less in line with injectable GLP-1s outside the U.S. and then at a sort of a constructive discount to injectable GLP-1s in the U.S., when we're sort of thinking about modeling this growth driver (inaudible) long-term going forward?.

Thank you, Mark. I counted 3 questions. So the first question to Mads on zilti and early thoughts on Phase III development programs and inclusion criteria and what patient population to go for, then Saxenda U.K. price and patient population restrictions. And then finally, for you, Camilla, and then also for you Rybelsus pricing U.S., ex U.S. on a conceptual level?

Yes. Thank you, Karsten. I will start -- I might pass over to Ludovic who has experience in the cardiometabolic arena from his prior experiences. Just a couple of comments on how that has faired. But overall, ziltivekimab is supposed to address the residual unmet meet i.e. the residual risk of patients who are already treated with a myriad of platelet blockers, anti hypertensives and all the usual agents, diuretics and whatnot that are statins but are used in this population.

So we know that about 7 out of 10 people with atherosclerotic cardiovascular disease they actually do have some degree of intravascular and cardiovascular information. That's what we're talking with ziltivekimab.

The reason why we're only going for the 5 million to 8 million patients initially that have ASCVD in conjunction with moderate-to-severe CKD is that it is, as you correctly stated, Mark, an enriched population with event rates that are much higher than normal, making the trial population easier and faster to dissect out a benefit of this anti-inflammatory action because the signal to noise ratio will be enhanced in that population. Then, of course, over time, we can broaden out zilti in that population and basically the trial design is going to be similar to its MACE risk reduction with secondary endpoints related to the chronic kidney disease and other elements, as you would normally do in a CVOT.

It's just a relatively sick population, and that also means that Martin doesn't need to recruit quite as many patients for quite as long as he would have done if it were more like the SOUL trial, for instance. But do you have any comments that you historically have in that field because your old company also now has a kidney drug on the market or close to market?

Thank you very much, Mads. I think 2 comments on my side. The first one is that it's completely logic to look at the benefit of these drugs in the context of a wide metabolic set of diseases. If you look at the patients today that are diabetic and cardiovascular and real, these are the same patients. It's not yet the same physicians, but it's the same patients. The risk factors are the same, then the pathways are the same. And I would even say that, increasingly, the drugs used to treat them are actually effective across the renal sphere, the cardiovascular sphere and the metabolic (inaudible).

So it's very logical to do so and to consider the patient holistically sense of science and then the sense of history.

The second comment is that when you're addressing it specifically the renal, the nephrologic side, you're then having a wide range of patients, ranging from the moderate eGFR decrease down to the pre-dialysis or the actual dialysis sector. And that is, of course, a very complex population, and you don't want to treat all these patients the same way. And in this way, I completely support the philosophy behind the Phase III, which is to look at a first set of patients with -- that is enriched with a high-risk factor.

We not necessarily cover the broad spectrum of kidney patients that, by the way, have very strong comorbidities, and you really want to make sure that you understand how the drug is working for them rather than just put your drug in a very complex setup. So on these 2 elements, I believe that the road taken on the program of zilti makes a little sense.

And the next question comes from the line of Peter Verdult from Citi.

Sorry, before we get to that, maybe we should just answer the second question. So very fast on Saxenda U.K. in terms of NICE, the patient population, they are -- NICE have recommend Saxenda for use in a patient population with a BMI above 35 and patients that are also pre diabetic with a cardiovascular risk. This is the recommendation from NICE.

And you asked also whether this should be sort of a general assumption that this is how it is. But actually, we see that these specifications vary slightly from country to country. So you would say that this is what exactly fits the U.K. and the NICE recommendation. We cannot comment on the actual price level in the NICE recommendation.

And then on Rybelsus pricing outside the U.S. and in U.S., what has been important for us in documenting the support for the price of Rybelsus has been that Rybelsus is an innovation being an all GLP-1 and it should be priced relatively to the efficacy that it can give compared to other GLP-1s. So we've seen that being supported generally in the U.S., but also in the countries where we are now launching outside the U.S.

So currently, we have launched in 8 countries outside the U.S., where we have also obtained a similar to GLP-1 reimbursement.

The next question is from Peter Verdult from Citi.

Three quick ones, please. Camilla, can you please come back...

Peter, could you please speak up, your line is a little bit soft.

Is it good? Can you hear me?

Try again. Yes, try now.

Okay. So 3 quick ones. Camilla, (inaudible) can you remind us typically how long have you run these 4 and give us some quantification of the impact you're seeing beyond site traffic or other KPIs that you monitor?

Secondly, the (inaudible) just a clarification that the underlying growth that you're seeing in the U.S. and IO once you take into account (inaudible) stocking is probably around 15% and 10%.

And then lastly for Mads, just on R&D, you talked about R&D spend. (inaudible) integrity and (inaudible) quality (inaudible) during COVID. How worried are you that it's going to impact (inaudible).

Thanks, Pete. Your reception here was not good, but I think let's try top line and address your questions. So the first one was the duration with our DTC programs in the U.S. The second one was with regards to the patient level inventories linked to COVID and the third one was COVID impact on clinical trial activity, (inaudible). So..

Yes, so forgive us if we didn't hear all of your questions. But regarding the duration of DTC with Rybelsus that we started on the 21st of September, we call it wake up to the possibilities of Rybelsus and we've seen that it has had really nice traction to rybelsus.com after the launch of the DTC campaign.

When it comes to the duration that I believe was also part of your question, we cannot share specific time line. But what I can say is that Ozempic is still running -- we're still running DTC campaigns with Rybelsus -- sorry, Ozempic that seems to have a really good traction. So we will continue focusing, of course, both on Rybelsus and Ozempic when it comes to DTC in the future.

Thanks, Camilla. And on COVID impact on geographies and inventories, then on a year-to-date basis, our 7% growth, our estimate is that COVID on a net basis impacts our year-to-date sales growth by -- to the tune of 1%. And that 1% you should take as similar between North America and IO and in relative terms on a product basis.

But needless to say that there are certain variances. So for instance, when you look at our Saxenda growth rate of 6%, clearly, we would have expected a double-digit sales growth for Saxenda. So there are certain barriers, depending on how sensitive products are to either single event as in hemophilia or new patient starts as in obesity.

In terms of destocking, a lot more to add than previously. We cannot tease out the remaining inventories impact or destocking into the script trends between geographies. You'll recall the stats that we saw DKK 2 billion inventory hike in Q1 linked to our 14% sales growth, then DKK 500 million stock in Q2, mainly on wholesalers. And then we've seen slight destocking in Q3, but it's impossible to tease out at this point.

We have seen -- in the U.S., we have seen that the share of 90-day scripts going up. It has been a threat over time, but we did see another pickup over the Q2.

So we are -- in rough terms, we saw a step-up of some 2 percentage points. So we're around, depending on products, et cetera, around 22% or so share of products on 90-day scripts as of the latest data points.

Then Mads, on clinical trials and COVID?

Yes. And I'll do my best. I heard most of the question, Pete. You have to bear in mind a couple of things that have happened related to the COVID pandemic. One is that the industry, as such, has been in a really close dialogue with the regulatory agencies across the globe, in particular, FDA and EMA in actually agreeing upon how to allocate or what to do with missing data and the kind of things that happen in the pandemic.

And I think there's been really good solutions to that what it is the company has to be able to account for and whatnot. And at the same time, in terms of reporting adverse events, which are the ones you have to report despite lockdown, serious adverse events, for instance, and whatnot.

So I think there's been really good dialogue there. But at the same time, we, as a company, have developed very rapidly tools to mitigate the COVID-19 situation such that we can -- today can say that in, for instance, the cardiovascular outcome trial that runs over many years, we are now able to actually have the investigational medicine in question shipped directly to the trial participant.

We're able to monitor remotely what's going on at the investigator side. We're able to follow the patients very closely via an electronic patient interface system, et cetera, et cetera. And then bear in mind that the major readout in the cardiovascular outcome trial is a very easy one. It's either you die or you don't, either have a stroke or you don't. And of course, adjudication will take place but adjudication doesn't take place on the day of the event.

So we will be able to collect what needs to be adjudicated over time, and that will then be done in a blinded and centralized manner as usual. But this is actually an easier readout, so to speak, and the trials are less intensive than if it's a treat-to-target A1c driven trial, because here, the patients do come so often to the investigator because it's basically a trial that measures how you fare in terms of major adverse cardiovascular outcomes.

And now let's take the last question.

The last question comes from the line of Wimal Kapadia from Bernstein.

Wimal Kapadia from Bernstein. So first, can I just ask about the obesity trends. So we're seeing an improving trend sequentially in the U.S. with smaller declines. And actually within international markets, EMEA had nice growth and rest of world was flat. So my question is, should we expect further sequential improvement in 4Q across all regions?

So are you -- should we expect growth in totality for the fourth quarter? And could we actually see a return to growth in the U.S. in the fourth quarter?

And my second question is just digging a bit deeper, one for Mads, on the profile of the new formulation of oral sema. I mean, I guess, what gives you -- what is different that gives you the confidence to increase the dose so substantially? Because I was kind of anticipating improved bioavailability will drive lower dosing and therefore, superior tolerability or similar dosing for improved efficacy, but not such increased dosages. So just curious what is driving the higher doses in terms of the product profile. And then just a final very quick one. Just following on Michael's question on concizumab. You're continuing the products. So I'm just curious how you think about the return on investment for the asset given the profile that you've seen so far?

Great. Thank you, Wimal. So first question to Camilla on obesity trends and whether we see sequential improvement in growth into Q4 with the COVID uncertainties we all know about. Taking one oral sema high dose Mads, dosages versus bioavailability and all that. And finally, I think Ludovic on concizumab and return on investment given the restart? So Camilla if you start?

Thanks a lot. So on obesity, as Karsten mentioned earlier, of course, because of the short-stay time obesity is impacted by a slowdown in patients going to visit the doctor that we saw in the second quarter of this year. But we do see improvements in the third quarter. And depending on how things are progressing, of course, we expect that improvement to continue for the remainder of the year. We are, of course, also looking into how in the future, we can learn from a less contact-based situation, meaning how prescription can potentially be done more online in the future.

And the obesity is, of course, a good place to start. So -- because it's easy to diagnose. So we have taken these factors into account when giving our guidance for the rest of the year and based on the current situation with COVID.

And when it comes to oral semaglutide, I know, Wimal, that you are aware of ongoing trial activities with the new and upgraded formulations of oral semaglutide tablets that has been ongoing for quite some time now. So what is happening now is that by taking these high doses in an already known formulation, we will get data on the efficacy, the safety tolerability and so on, based on these tablets. We can then, assuming that we were to come up with tablets with superior qualities and properties in terms of, for instance, by availability then bridge to those tablets in via clinical pharmacology bridging study and from there on, move directly into the so-called pivotal trial that can then include the go-to-market tablet formulations.

So that's the thinking. So you need not necessarily believe that these are the nominal doses that will end up being there, but these are the ones we want to investigate with a known tablet formulation, what do they do.

And when it comes to concizumab, thank you for the question, and I think Mads alluded to the resuming of the trial a few weeks ago, and we continue to believe that concizumab can offer a very interesting treatment alternative for patients -- for hemophilia A&D patients. From a segment perspective, especially on the B segment, which is a segment that is highly uncovered by the current product, that's one. But also because the features provided by concizumab in terms of injection, in terms of patients friendliness, in terms of storage, in terms of all sort of features that are complementary today, the low ADR that you're getting from this drug, we believe can make it a very interesting profile for patients even beyond hemophilia B. So we still believe that there's a place for that drug in the [momentum] of hematologists, and that's the spirit in which we're continuing the trial right now.

Thank you, Ludovic, thank you, Wimal. This concludes our third quarter (inaudible) presentation. Again, thank you to JPMorgan and Richard Vosser for hosting and arranging this session. And we look forward to seeing you all on either on roadshow or in conjunction with our full year release coming February.

So stay safe and looking forward to connect soon again. Bye-bye.

This now concludes our conference call. Thank you all for attending. You may now disconnect your lines.