Zealand Pharma A/S (ZEAL) 2020 Q4 法說會逐字稿

Ladies and gentlemen, thank you for standing by, and welcome to Zealand Pharma Results for Q4 2020. (Operator Instructions) I must advise you this conference is being recorded today.

And I would now like to hand the conference over to your speaker, Matthew Dallas. Please go ahead.

Thank you, operator. Welcome, and thank you for joining us today to discuss Zealand's full year results for 2020. I'm Matt Dallas, Senior Vice President, Chief Financial Officer of Zealand.

With me today are Zealand's President and Chief Executive Officer, Emmanuel Dulac; and Chief Medical Officer, Adam Steensberg.

After the prepared remarks, we will open the call to take your questions. You can find the related company announcement and additional supporting information on our website, zealandpharma.com. I'd like to point out that we will be making forward-looking statements that are subject to risks and uncertainties. These statements are valid only as of today, and the company assumes no obligation to to update them, except as required by law. Please refer to recent filings for a more complete picture of risks and other factors.

With that, I will turn the call over to President and CEO, Emmanuel Dulac.

Thank you, Matt, and thanks to everyone for joining today. This is a very special moment at Zealand Pharma, as we are approaching our PDUFA date. A vision of something that started 22 years ago. Zealand Pharma grew first from a small research lab into a globally recognized R&D development-focused organization. 2020 was a pivotal year, as we added another stage to the (inaudible). To fully leverage the value of our pipeline, we added commercial capability to our company and became a fully integrated global biopharmaceutical company, a level rarely achieved in biotech.

2020 was a challenging year for the world. But we kept executing on our vision. In research, we made huge progress in the field of peptide therapeutics, improving on delivery, on targeting and understanding of the root causes of many previously untreated diseases. With the support of our research engine, our platform and our [scientists], we are advancing new and better treatment options to people living with a wide range of disease and large unmet medical needs.

In the coming weeks, the dasiglucagon auto-injector and prefilled syringe may be approved by the U.S. FDA for the treatment of severe hypoglycemia in people with diabetes, one of the most feared complications of diabetes. Pending approval, we are fully committed to execute on Zealand's first independent product launch in late June.

In anticipation of the potential dasiglucagon approval, we have built out a robust commercial organization in the U.S. through the acquisition of Valeritas.

We have an experienced U.S. commercial team. We gained significant maturity in commercializing the marketed V-Go wearable insulin device, and we kept strengthening these capabilities by hiring highly experienced and talented leaders to prepare us execute on our vision.

If approved, dasiglucagon severe hypoglycemia will be the second product commercialized by Zealand, in a vision to have 5 commercialized products by 2025. Also, in January, we raised DKK 749 million of new capital, which is simply the largest capital raised in the company's history, leaving us well capitalized, as we continue to develop our commercial capability while progressing multiple programs across our robust pipeline.

Our world-leading peptide drug discovery and design is evident throughout our pipeline, with multiple assets in both late-stage trials and preclinical testing, all of which have the potential to transform the lives of patients with metabolic, gastrointestinal and immunology disease. We have made good progress in both our late-stage and early stage programs. Last week, we also had a dynamic R&D day in which we offered details about our earlier-stage assets.

And we'll now turn it over to our Head of R&D, Adam Steensberg, who will discuss Zealand's 2020 clinical milestones. Adam?

Thank you, Emmanuel. And please go to Slide #5. 2020 was a transformative year for Zealand Pharma's pipeline. We continue to deepen our leadership in peptide drug discovery and development, by expanding the therapeutic focus of our early pipeline to include obesity and associated metabolic diseases, and we've also brought forward new candidates for inflammatory bowel disease and other chronic inflammatory diseases within the TI franchise. If we start with dasiglucagon, then we are pursuing multiple opportunities to improve patients' lives through different product modalities. And later this month, as Emmanuel mentioned, we expect the approval of dasiglucagon auto-injector and prefilled syringes for the treatment of severe hypoglycemia in diabetes. This would be based on 3 Phase III trials that all demonstrated a median time to recovery from hypoglycemia in only 10 minutes. As Emmanuel alluded to, this is going to be our first potential launch of a product that have been discovered and fully developed by our team.

On Slide 6, you can see the dasiglucagon Phase III program for congenital hyperinsulinism and also rare indication caused by defects in the pancreatic beta cells. As already reported, the first Phase III trial did not meet the primary endpoint, however, hypoglycemia was reduced by 40% to 50% with dasiglucagon as compared to standard of care alone when they assessed this by blinded continuous glucose monitoring. Also, we assessed dasiglucagon treatment to be safe and well tolerated, and importantly, 31 out of 32 patients continued into the long-term extension study. We are conducting additional analysis and engaging with regulators to discuss the results of the trial while we await the outcome of the second Phase III trial in neonates up to 12 months of age, which we expect later this year.

Please go to Slide 7. In 2020, we continued our strong collaboration with Beta Bionics on the iLet bionic pancreas device, which utilizes dasiglucagon, and we expect to initiate the Phase III trial in the second half of this year. The study will enroll approximately 350 adults and 350 children with type 1 diabetes and with a primary outcome measure being HbA1c superiority of the bihormonal iLet configurations over the insulin-only configuration at week 26. Overall, this program has been designed to demonstrate the clinical outcome of utilizing dasiglucagon in the bihormonal iLet versus the insulin only iLet, while we will also compare the results to intensify usual care in a third arm.

As you can see on Slide 8, we have been broadening our pipeline of therapies to target obesity and nonalcoholic steatohepatitis, which we consider key value drivers for the future of Zealand. Alongside our partner, Boehringer Ingelheim, we progressed the clinical development of our GLP-1/glucagon dual agonist in 2020 with the initiation of the Phase II trial in type 2 diabetes. And shortly, we expect to initiate Phase II developing in obesity and NASH as well.

On Slide 9, you can see our 2 late preclinical assets in development for our obesity, both of which have shown additive weight loss potential when co-injected with GLP-1 analogs. And we anticipate starting Phase I trials with our amylin analog later in the year and expect to bring our [GIP] analog into Phase I next year.

In addition to the advancement of our metabolic programs, we have also made significant progress on the clinical development of our gastrointestinal candidates and recently announced some new preclinical assets.

Please go to Slide 10. So glepaglutide is our long-acting GLP-2 analog with an effective half-life of approximately 50 hours, which is being developed in an easy-to-use disposable auto-injector to simplify its administration. As announced at the R&D Day last week, we are progressing with patient enrollment for the pivotal Phase III trial, which evaluate once- and thrice-weekly dosing of glepa versus placebo over 26 weeks, and we expect the results of this trial next year.

On Slide 11, you can see the update on glepaglutide, which is our [follow-on] molecule for treatment of short bowel syndrome. Last year, we completed a Phase Ia trial, which demonstrated a plasma half-life of 120 hours in humans. While GLP-2 mainly stimulates intestinal absorption capacity, GLP-1 slows down intestinal motility, thereby likely contributing positively to enhance absorption. And we, therefore, believe that glepaglutide has the potential to take treatment of SBS to the next level and get patients one step closer towards regaining full enteral autonomy. The Phase Ib trial, which assess multiple ascending doses of dapiglutide dosed weekly is ongoing with the second dosing cohort being completed.

Turning to the early inflammation pipeline on Slide 12. We've been expanding our research activities into IBD and other inflammatory diseases, as we believe that peptide medicines represent a great opportunity for new innovation in the inflammation disease space. This area has been dominated by antibody drugs for many years. The programs we are progressing towards the clinic represent high-profile peptide targets. We are currently advancing our selected Kv1.3 blocker into IND-enabling toxicity studies, with an eye to IBD as the first indication. And also progressing our alpha-4-beta-7 inhibitor, which has the potential to be our first ever oral peptide as the molecule has been designed to have relevant oral bioavailability.

Lastly, we have made great progress in the collaboration with Alexion Pharmaceuticals on the development of our complement C3 peptide inhibitor. We have selected the candidate molecule and are now progressing this molecule into the next stage of development.

And with that, I would like to turn over the call to our CFO, Matt Dallas, to walk us through our Q4 and full year financials. Matt?

Thanks, Adam. On Slide 13, you will see Zealand's income statement for 2020 and how it compares to 2019. Total revenue for the year was DKK 353.3 million, or USD 54.2 million. This was driven by net product revenue of the V-Go wearable insulin delivery device as well as partnership revenue from our collaborations with BI and Alexion.

The net operating result for the year was a loss of DKK 792.4 million or USD 121.1 million, sales and marketing costs mainly related to the commercial infrastructure in the U.S. to support V-Go while R&D costs related to our late-stage clinical programs.

Slide 14 illustrates our financial position and ability to grow our growing business through continued investments. Net operating expenses for 2020 were DKK 1.09 billion or USD 166.9 million. At the end of the year, we had a cash position of DKK 1.26 billion or USD 192.2 million, funding the company through several key upcoming milestones.

Turning to our financial guidance on Slide 15. In 2021, we expect revenue from existing license agreements. However, since such revenue is uncertain because of size and timing, we do not intend to provide guidance on such revenue. Net product revenue from the sales of our commercial products is expected to be DKK 220 million with a range of plus or minus 10% as compared to 2020 net product revenue of DKK 161.3 million. Net operating expenses in 2021 are expected to be DKK 1.25 billion with a range of plus or minus 10% as compared to 2020 operating expenses of DKK 1.09 billion.

And with that, I will now turn it back to Emmanuel.

Thanks, Matt. As Matt outlined, we are in a strong position financially, which is crucial as we head into this critical next few months. With the PDUFA March 27 date in site, we are already ahead on commercial preparations. And pending approval, we will be ready to execute on our first product launch. First product from our own research and first indication for the dasiglucagon franchise. As Adam outlined, late-stage program milestones and R&D investment that we covered in detail at our R&D Day would have been exciting in any year, but I am especially proud of our talented employees to accomplishing this in the midst of the global pandemic that presented unforeseen challenge. This team's agility and commitment to changing lives of patients with the next-generation of peptide therapeutics is the reason Zealand is positioned to become a high-performing commercial organization, supported by a world-class research engine and on track to deliver on our vision of offering 5 commercialized products by 2025.

Thank you all for listening. I will now turn it over for questions.

(Operator Instructions) And your first question comes from the line of Michael Novod from Nordea.

First, a question to the financial guidance and the product sales. So just trying to get a bit more flavor also on how you see the trends moving for V-Go? Because if you sort of landed at 220 and at least it must -- I would assume it assumes a significant decline in V-Go sales. And also in that connection, regarding the real launch of HypoPal, how fast do you actually expect to be able to be in the market with HypoPal pending the approval in late March? Yes, I guess that was actually it.

Thank you, Michael. Matt, do you want to take this question on financial guidance?

Sure. Yes. So on the financial guidance, as we communicated in our earnings release today, I think the plan is the launch for the dasiglucagon auto-injector and prefilled syringe to be late June of this year. Our guidance on revenue is DKK 220 million in net product revenue. It is a blended number, but we're not breaking out the split between them just based on the fact that we're even ahead of right now that PDUFA date for the HypoPal or for the -- sorry, the prefilled syringe. But it will be -- continue to be a blended sales [force] that will support V-Go throughout the...

But is it fair to assume that you sort of see a decline, and what would drive that decline? Is that because you are moving all your efforts into the prefilled syringe? Or how should we see this?

Yes. I mean, I'm not sure I would say it's totally a decline. We did 161 last year. There are efforts that will be -- that will move towards the prefilled syringe, yes. while also kind of changing the sales model within that.

Again, it's -- I think, Michael, it's a blended revenue target. But I would say that our focus -- to answer you. Our focus this year is on commercial excellence. We are building a company to allow us to launch pretty much 1 product every year from now to 2025. So that's really the focus. And I think the proof is in the pudding. We have to really look at what's important for us, which is making sure that we can execute on these launches. And so that's why this first launch started in late June is critical for us.

Our next question comes from the line of Graig Suvannavejh from Goldman Sachs.

I've just got a couple, please. And maybe just picking up on the last questions around the launch of prefilled syringe. Maybe if you could give us a sense of where are we in that market right now given the Lilly and Xeris launches? How do you think those launches have impacted growth in the market? I think, on the R&D Day, you said the market maybe has grown 10% since those 2 products launched, perhaps we would have thought that the growth would have been a bit more robust than 10%. And what additionally do you think that you will -- either can do or need to do to make your prefilled syringe a successful launch and so that's kind of my first question.

And then just the second question I have has to do with Emmanuel, your comments around having a company with a commercial capability of launching a product every year until 2025. Can you just remind us specifically which products you're pegging to each year? Just want to make sure that we're thinking about things the same way that you are. And then my last question, maybe for Matt, just going back to the financial guidance. Any way for us to be thinking perhaps directionally as we go through 2021, how we should be thinking about R&D and SG&A?

Yes. Graig, on your first question regarding the market, the [hypoglycemic] market. I think you noted plus 10% growth during -- for 2 novelties being introduced during COVID-19 year, I think it's actually not bad. We actually, of course, just like pretty much everyone listening to as well our competitor's conference. And they mentioned that this -- the impact on COVID in 2020 for them during their (inaudible) launch operation was impairing their ability to really measure the impact of this market. I think what's really interesting in this market change is that these new novelties have actually basically taken around 30% to 40% of this market in 1.5 years' time basically, which is a very nice conversion, assuming that this is a very stable even (inaudible) market, which hasn't seen any innovation in the last 20 years. So there's some prescription habits from prescribers and from the patient. So this is a very interesting shift in the market. And I think this market will likely continue to grow and will likely continue to convert to these novelties. So I think for us, the timing is right. On the launch year, I said pretty much year after year. So we have the goal to have 5 commercialized products by 2025, assuming -- and again, we're hopeful that we get a good response from the FDA, we would be launching one this year. And then we have 3 to go to 2025. So yes, we have few products in late stage that we hope to be able to bring to the market in this same period. And you know, then, I mean, it's CHI, glepa, dual hormone pump. We have the multi-dose as well. But yes, I think we are pretty much looking at these products as those that will actually help us achieve this goal in the next 5 years -- 4 years now. And on your last question -- yes, you get it, Matt?

Yes. So Graig, if you look at our 2020 numbers, it was -- 55% of our spending was R&D, 45% was SG&A. The sales and marketing component of that SG&A in 2020 was only for 3 quarters as the Valeritas acquisition happened on April 2. So what you're looking after that 2021 number is you're going to have a full year impact of the sales as well as launch costs, if that helps.

Our next question comes from the line of Jesper Ilsoe from Carnegie.

Just also to follow-up on Michael's questions on the guidance on dasiglucagon. So can you first just confirm that you will launch both HypoPal and the prefilled syringe late June, so that you not end up like Xeris, which, I guess, first launched the prefilled syringe, so just whether you can confirm that. And then I have a follow-up afterwards.

Yes, yes. So we hope to be able to launch these 2 presentations, yes.

Okay. Cool. Then just on the timing. So you say in the late June. So is -- that's 2, 3 months out. So is that due to the pandemic [hindering] face-to-face promotion. Is it due to production, capacity constraints? So why do you intend to launch in late June, why not, say, April or May, just to get that?

I think that's just the nature of the operations. When you get the response from the FDA, it takes 2, 3 days for the FDA to post your label. We need to print label packaging, ship, distribute. And then at the same time, we can actually operate -- we can operate right from the get-go with people in the field in parallel, trying to engage prescribers and so that we gather prescriptions. But for us, what we define as launch is when the drug will be in the end of patients. And so it takes -- it always takes few weeks operationally to get there. So that's why we're extremely precise, maybe a bit more over it, but that's actually the reality. It will be a late June launch for us.

Okay. Just on your net sales guidance also. So will you use coupons on this dasiglucagon launch? And is that why you say sort of [implicitly only] expect to generate limited dasiglucagon sales in 2021? So will you have any revenue from dasiglucagon or is it obviously say coupons to build up the prescriber base?

At this point, we can't comment on the breakout or the gross-to-net assumptions on any of our programs for 2021 commercial programs.

No, sure. But are you going to use coupons on this launch?

Again, we can't comment on that given this and we're not even at the PDUFA date.

Our next question comes from the line of David Lebowitz from Morgan Stanley.

By June, I guess, how high-touch do you expect your sales operation to be? And given the nature of the product, how high-touch does it actually need to be to be able to get an effective launch?

Yes. Again, we cannot comment on anything related to the commercial operations as we still are expecting a response from the FDA on the approval. So I think based on what we know from the market, this is a market where there is a need for novelties. And we know that the expectations are very high for things which -- solution that will simplify patient lives and will bring them potentially better efficacy. But again, on our own products, we cannot comment on the commercial operations or the commercial -- make predictions on commercial viability of the product before it's approved.

With respect to the congenital hyperinsulinism data coming up, given that the first trial was not successful, what is the, I guess, the regulatory approach? Do you see a path to approval with the first trial not succeeding if the second trial does happen to succeed?

Yes. Adam, do you want to take the CHI question?

Yes. Sorry, I was on mute. As we also explained at the R&D day, our approach from here will be to discuss with FDA the totality of evidence for dasiglucagon. And you can say the ongoing second Phase III study uses a different primary endpoint. So that is -- these are small children who are in the hospital, having IV glucose infusions in order to stay out of hypoglycemia and the endpoint is the ability to be less dependent on IV glucose infusions.

So we are hopeful that we'll meet the [primary endpoint in that] study and then, of course, we will use the evidence from the first study from the continuous glucose monitoring that -- which shows a 40% to 50% reduction, but also the fact that we have so many children who chose to actually still be in treatment now for some 2 years later and the evidence that we have collected in the long-term extension study. So that will be our approach. And it's still our ambition to have this product ultimately approved with the FDA based on that totality of evidence.

But as we also said, we now need to have the second Phase III study readout later this year. And then you can say we can be much more clear on expected timing.

Your next question comes from the line of Lucy Codrington from Jefferies.

I just have a few left. Firstly, I just wondered if you can give any update on any potential ex U.S. plans for HypoPal after Xeris' product was recently approved in Europe. And then secondly, I believe Xeris also commented after feedback from the FDA developments that exercise induced hypoglycemia would be more straightforward than [post-bariatric hypos], and they're also planning to start Phase III by the end of the year. Why might that be? If you have any thoughts, and also, how quickly do you anticipate you could potentially get to Phase III for one or both of these indications? And then lastly, I know you can't -- you're not forecasting any milestones, but could you outline any possible milestones that you could receive without giving figures?

Yes, Lucy. So regarding the rest of the world or ex U.S. market opportunity, we're still working on it right now. It is actually not very clear from the information we have gathered exactly what the potential is in these markets for [solutions.] So we are actually still working on it. Of course, for us, the opportunity is open, and we are actually working on it right now. We are as well looking at it in the scope of the pipeline we have, which is -- it's not one product launch, but it's a succession of product launch. So I think it makes actually the potential opportunities a bit bigger, of course. And so we're looking at it in the whole totality of the pipeline. And so as soon as we are ready to communicate on it, we will. But we are actively working on it now. And yes, you take the next question, Adam.

Okay. I can address the mini-dose concept. And we also shared a little bit on that. So you can say we are also pursuing both exercise induced hypoglycemia and post bariatric hypoglycemia. And -- so these are 2 parallel routes. The interesting thing for us is that both will actually use the same injection device or pen, durable multiple-use pen, which we already have developed and which we expect we will take into clinical studies later this year. That pen will actually take the cartridge that we also use for the dual-hormone artificial pancreas pump that we are working on with Beta Bionics. So that product is also ready and would be actually ready for Phase III studies later this year.

On the next clinical step for both of these indications, then we expect to actually do outpatient studies in PBH and exercise-induced hypo this year. So we will do 2 -- at least 2 studies -- Phase II studies to assess how to use this concept in the best way. And what I would also highlight is that if you look to dasiglucagon that we have completed the chronic [tox], we have completed the carcinogenicity studies and all these supported activities. We have the cartridge ready for Phase III studies.

So all that are things you need to have in place before we can embark on Phase III beyond the clinical evidence. So from the technical perspective, we are ready. From a clinical experience, we just need a few more studies before we would feel confident in how to best address this unmet medical need in these 2 situations. But we are moving forward steadily, as Emmanuel also said, these are, you can say, the upside opportunities that could actually lead to additional approvals within the next 5 years.

So we -- but we feel that we are progressing this in the right way. And whether exercise-induced hypoglycemia is easier than PBH, I think that depends on how you look at it. Normally for a rare disease, like PBH, you would expect less patients. But for -- of course, for a product -- a chronic use product in type 1 diabetes, you would expect to have significant patient exposure before you can get it approved. We will get some of that from our bihormonal studies, which will be extremely supportive of the exercise-induced mini-dose pen as well. So we hope to provide more guidance on our next steps, let's say, what we are going to do in next year with regards to Phase III, et cetera, later this year.

On the partnership milestones, we have not disclosed the tiers of milestones with either BI or Alexion deal. What I would say is that as a milestone with either partnership were to become imminent, that's when we would make that announcement, including the financial component.

Your next question comes from the line of Etzer Darout from Guggenheim.

Just maybe to switch things up a little bit. Adam, we saw some interesting new updates from a recent oral integrin molecule. Just if you have any kind of projections on when (inaudible) could be filed for your integrin inhibitor or any plans to sort of accelerate preclinical development based on what we've kind of seen recently?

Yes. And it is, of course, also interesting from our end to monitor, you can say, some of the progression made in this area. So for our alpha-4-beta-7 inhibitor, we have not provided guidance for when we will start this Phase I study, which, of course, means that it will not happen this year, then we would have talked about it. But we are progressing steadily. And I think what is important to us, and that is what you will also notice for all our programs. Also, if you look at a historic perspective, is that we want to have it right from the start because then you have much less issues in the end where it becomes extremely expensive.

So we are working that extra mile here in the start to make sure that we get things right before we progress it into the clinic. And especially when you have to do with all molecules, you don't want to take too many oral peptides. You don't want to take too many penalties because it's super expensive when you get further into development. So that is our focus right now. And it's actually -- it goes along with, you can say, what we also announced last week that we will step up our focus on all therapies in the future because we really think we have an edge here, combining not only our peptide design capabilities, but also all the supported activities that are needed in order to get both the peptide, but also the formulations to the level where they can actually become attractive drugs and not just research tools. So I cannot give you -- I'm sorry, I cannot give you a more specific date. But we are encouraged by seeing the development in the area. And we truly believe there's a huge opportunity here for Zealand also going forward, all peptides in an area where we have traditionally seen antibodies and where small molecules sometimes struggle to actually make it all the way due to unspecific finding and so on.

Your next question comes from the line of Joseph Stringer from Needham.

I wanted to ask sort of a general strategy question on dapiglutide here. So is it -- you mentioned that (inaudible) is a long-acting GLP-1, GLP-2 and potentially -- potential development in SBS and other indications, but is it a certainty that you would develop in SBS, sort of a follow-on to glepa, given that you have a once-weekly arm in that glepa trial? Or -- I guess, what's the prioritization, what indications you would develop [dapa] for? Would SBS be the highest priority, or would you look to other indications first?

Adam, do you want to take the clinical side of it, and I can talk about some strategies around?

Yes. So first of all, maybe I will just address. First of all, we have a very, very strong commitment to SBS. As you know, we have been in this space for a number of years and have a deep, you can say, commitments to actually take treatment to the next level. We are extremely confident in our lead molecule with glepa that, that as a mono GLP-2 analog can actually -- has a great potential for patients, but we also acknowledge -- like in obesity and other indications, if you truly want to take a disease like SBS to the next level where you are looking into complete enteral autonomy, for instance, so patients become completely independent on parenteral support, probably we need to attack more than 1 receptor. And that's where we are extremely excited about Dapiglutide because it is addressing 2 -- which looks to be 2 important aspects of the disease. So in that sense, I would say, we are committed to the SBS community. We also acknowledge that there is actually great opportunities for other indications, which we have not discussed yet. But which -- with a molecule that dapi could actually play a difference. So that is probably what I would say. And what we also said is that we'll be more clear on this guidance later this year once we have the Phase Ib data. Emmanuel, over to you.

Yes. I just want to say that I wanted to draw a parallel between this -- basically dapiglutide creates a franchise in malnutrition. So we're very excited to have not 1 product but 2. And it's a bit -- I draw parallel with the question from Lucy earlier on the geographic opportunity. I mean it -- of course, it creates a lot of opportunities for us with different indications or different geographies. Now we have to prioritize investments. We have to look at business cases as well, which allow us to advance investments where we can actually sustain them for a long period of time and grow in this field. So the excitement around dapiglutide and glepaglutide combined is the possibilities are enormous in SBS and beyond. So we just need to prioritize actually now. But yes, very exciting times and programs.

Your next question comes from the line of [René] (inaudible) from Kempen.

First question is on your current sales force. Can you remind us on the size of your current sales force? And will this number increase significantly assuming HypoPal approval? And the second question would be on the dual-hormone pump Phase III trial in collaboration with Beta Bionics. You indicated that the start of the Phase III program would be expected towards year-end. Can you remind us how long you would think it would take for such a study to be conducted from the start until data gets reported?

I'll take the first one, and then Adam will take the Phase III on dual-hormone pump. On the sales force, I mean, I would say sales force is limiting. It's bigger and a bit more complex than only the sales force. We have actually filled (inaudible) people. We have actually nurse trainers who are supporting as well for -- so the combination of this team is actually aligned with the guidance numbers we communicated before. We're not planning to add more bodies. We are right-sized now to be able to handle potential launch for the rescue pen. And Adam, do you want to talk about the dual-hormone pump?

yes. So the bi-hormone pump Phase III study, it's -- the primary endpoint is at 26 weeks. So every patient -- the last patient who is randomized will have to be in for 26 weeks before we can close the database and then report the results. So that gives you half a year. And then you have to add time it takes to randomize -- screen and randomize the patients. And that, of course, is the unknown right now. I think a good -- you can say, benchmark is how fast Beta Bionics is randomizing into the insulin-only people to study which is ongoing. That's a 440-patient study. And what they had expected is, I think, 3 to 4 months to randomize those 440 patients across 20 clinics. And we have more clinics in this study, plus the upside that we can actually randomize patients who were in the insulin only study as well. So we expect quite rapid randomization once we get the study going. And then it's a 6-month study.

Your next question comes from the line of Peter Sehested from Handelsbanken.

(inaudible) I have a couple of questions left. The first one is just touch base again on the guidance. Is it fair to assume that your guidance is risk-adjusted for the probability of approval of HypoPal? And secondly, in respect to your Alexion collaboration, have -- you've been in contact with people (inaudible) AstraZeneca and potential with the due diligence of this particular collaboration product?

So on the -- I think my first question, maybe, Matt, you can actually to about the guidance. On the second question, I just want to clarify, Peter, which collaboration are you talking about?

Alexion.

Alexion, okay. Maybe Matt, you can actually address the 2 questions.

So the first one is the guidance being on a -- risk adjustment on the guidance. And what I'd say is right now, it's a blended number, and it's -- it does factor in kind of a mid-tier scenario, if that makes sense. And then Emmanuel, if you want to comment on whether or not -- on AstraZeneca?

Yes. Well, that's the -- yes, and again, on this one, we've been asked because there's some ongoing discussions between 2 companies, not to actually comment on the -- basically the ongoing discussion. What we know and what we can communicate is that we are very happy with the compound we have advanced. And we are actually encouraged by the reception and the discussions ongoing. But again, we cannot comment on these 2 companies' activities right now just because of the sensitivity of their discussion.

Your next question comes from the line Graig Suvannavejh from Goldman Sachs.

Okay. They're just housekeeping in nature, and I've got 2. They're very short. The first is, could you remind us of what the statuses of the potential, I believe, it's last payment from Sanofi with regards to the prior collaboration you had with them, and I think we had modeled perhaps a payment in 2020. And just wanted to get a sense of what the latest (inaudible) if you can comment around that? And then second, this is really about your Boehringer Ingelheim collaboration. Have you got your 4 6 -- sorry, 456909 compound, which is referred to in the press release, but in the deck, and I've seen it in the past that you referred to as 906. I just want to make sure I understood just from a numbering question perspective, is it 909 or 906?

Yes. Okay. Well, that's -- the second question will be addressed by Adam shortly. Matt, do you want to talk about Sanofi?

Yes. So there's [DKK 15 million] in gross milestones from that collaboration. It's a [DKK 5 million] tranche and a [DKK 10 million] tranche. Those are not the net numbers that come back to [Zealand on this.] I can't give you good guidance on the timing because they're tied to cumulative sales. And I don't have -- I'm not -- we're not the sales engine for that. So it's hard for me to provide any clarity on when we would incur those.

Yes. So Graig, thank you for reading our press releases. I just looked it up on clinical (inaudible), it's probably 456906. That should be the right number. So sorry, if we've got this wrong in one of the releases.

There are no further questions at this time. Please go ahead.

With that, we'd like to thank you all for attending and all of your questions. We look forward to connecting on future announcements and updates.

Thank you. We conclude this call. Thank you very much.

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