GSK plc American Depositary Shares (Each representing two Ordinary Shares)

This is the usual state and arbor statements. We will comment on our performance using constant exchange rates or CR unless stated otherwise. As a reminder following the consumer healthcare demerger in 2022 to form Halian, we're presenting performance and growth of the continuing operations for GSK. Please turn to slide three. Today's management presentation will last approximately 30 minutes with the remaining 30 minutes for your questions. For those who wish to ask questions please join the queue by raising your hand, press star nine to raise and lower your hand if you're on the phone and we request that you ask one to two questions so that everyone has a chance to participate. Our speakers are Emma Walmsley, Tony Wood, Liz Miles, Debra Waterhouse and Iman Khai with David Redfern joining the rest of the team for Q&A as we hit the end of the call. Julie Brown who will officially start as CFO next week is also with us today on the call in a listening capacity only as part of the CFO succession handover. Turning to slide four and I'll hand the call over to Emma.

Thanks Nick and welcome to everybody. Please turn to the next slide. Our purpose is clear to get ahead of disease together by uniting science, technology and talent. We are preventing and treating disease at enormous scale and delivering a new chapter of growth. As a world leader in infectious diseases we are also focused on building our business in HIV, immunology, respiratory and oncology and we're off to a strong start in 2023 showing our strategy continues to deliver for all stakeholders. Excluding pandemic solutions we've delivered double digit sales growth including a fifth consecutive quarter of growth across the full portfolio with excellent commercial performances in vaccines, specialty and general medicines. Our adjusted operating profit excluding COVID-19 solutions also grew by five percent. Below the rate of sales growth this quarter due to some one-off factors as well as planned investment in new launches and Ian will cover this in a moment. Our adjusted EPS grew by 14 percent and we're firmly on track for our guidance this year. Our clear capital allocation priorities mean we continue to invest for growth and to deliver shareholder returns and the board approved a dividend of 14 pence for the quarter. Please turn to slide six. Our continued commercial success comes with a focus on driving the performance of our key growth products contributing a new record 44 percent of our Q1 sales adding 500 million pounds of additional revenue versus Q1 of last year. Notable contributions came from Shingrix and our HIV 2 drug regiments. Our growth drivers and new launches will support our growth over the decade and beyond. Our business mix continues to shift the vaccines and specialty medicines which are now delivering more than 60 percent of sales and we're confident this shift will progress to around three quarters of our revenue by 2026. A large portion of the growth is due to our pipeline launches in recent years. New products launched since 2017 delivered 2.2 billion pounds during Q1 alone underpinning our confidence in continuous future investment in pipeline development. Please turn to slide seven. Our R&D progress is delivering on our priority to strengthen our long-term growth prospects. In infectious diseases we're advancing our RSV older adult vaccine through the regulatory process and are on track to get the first US FDA approval in May and we also reported positive data last month on our pentathalent men ABCWY vaccine adolescents. We continue to invest in our priority vaccines platforms including protein-based antigens, mRNA following some encouraging early data in flu this year and bacterial platforms like MAPS. In HIV we presented positive data on long-acting cabanouche compared to a daily oral medicine and we continue to enhance our portfolio with business development. In March we signed an exclusive license agreement with Sinexus to access a -in-class novel antifungal adding to our growing anti-infectives portfolio and we're also delighted to announce the proposed acquisition of Bellis Health last week further strengthening our specialty medicines and building on our respiratory expertise with the potential best in class treatment for refractory chronic cough. We expect to do more targeted business development in the year ahead. Tony and the team look forward to sharing updates on our continued pipeline development and progress throughout the year with a series of therapeutic area focused meet the I'll now hand it over to him for some more pipeline details.

Thank you, Emma. Please turn to slide nine. Our R&D strategy is focused across four therapeutic areas shaped by our world-leading capabilities in infectious diseases, our understanding of the immune system and our technology capabilities. Our pipeline today comprises 68 assets in clinical development around two-thirds of which target infectious disease and HIV and we're making good progress in continuing to strengthen our growth prospects for 2026 and beyond. This quarter we saw two US FDA approvals, two advisory committees and several assets progress through clinical development including a phase two start for our oligonucleotide NASH asset GSK 990. We also started recruiting into our phase three program for BIPI-reversive for the treatment of chronic hepatitis B. Our ambition for BIPI is to improve functional cure rates for chronic hepatitis B patients and establish a new standard of care. We look forward to presenting data from the phase three B2GETA trial in the second half of this year. Next slide, please. Elsewhere in our infectious diseases portfolio we reported three important developments in the quarter. Firstly we received a positive recommendation from the FDA's advisory committee for our RSD vaccine OREXV. We remain on track for an FDA decision anticipated by May 3rd. Our phase three RSD study re-randomized subjects for a second season to receive either vaccine or placebo. These second season data will be important to better understand the duration of protection provided by OREXV. Data collection is ongoing and we expect a study report around the year. Secondly we announced positive data from our MEN-ABCWY phase three trial which demonstrated that our pentavalent vaccine has comparable protection to Bexarro and Menveo, was well tolerated with a safety profile consistent with Bexarro and Menveo. Invasive meningococcal disease is an uncommon but serious infection which can cause life threatening complications and death. Five serogroups are responsible for most meningococcal infections and there is currently no single approved vaccine which can protect against all five of these groups. Our pentavalent vaccine combines the antigenic components of Bexarro and Menveo. It's approved it could provide the broadest meningococcal serogroup coverage of the class and a simplified immune immunization schedule which we expect will lead to increased vaccine uptake. We will present preliminary data from this phase three trial at ESFID in May. We look forward to sharing these data with regulators to make this important vaccine innovation available as soon as possible. Finally at ECMID we presented positive phase three data for Jeppie-Tydison in the treatment of uncomplicated urinary tract infections. In the US alone there are around 15 million UTI episodes each year, around a quarter of which are resistant to existing treatments. Jeppie-Tydison has the potential to become the first new class of antibiotics for uncomplicated urinary tract infection for over 20 years. To complement Jeppie-Tydison we've also been active in business development. At the end of last year we added Tebupen, a novel antibiotic in phase three for complicated urinary tract infection to our infectious diseases portfolio. Also in March we agreed to in-license Brexifem, a novel oral cancer synthase inhibitor approved for treating vulvavaginal candidiasis. Together these three novel agents will broaden our anti-infective portfolio, an area of significant societal need. In HIV we reported data from SOLAR, the first -to-head study of our long acting HIV treatment cabanuvra versus a daily oral therapy. SOLAR demonstrated non-inferior efficacy, a very low virologic failure and a strong patient preference for cabanuvra, with 90% of participants in the trial expressing a preference for the long acting regime. At CROI we also present proof of concept data from N6LS, our broadly neutralizing HIV antibody. These data demonstrate high potency from a single antibody even at the lowest dose tested. Our neutralizing antibody is just one of the most important components of our treatment. We also have a very high potential for a combination of the two. We are very happy to announce that we are currently in development as a potential combination partner for Cabotegravir. Next slide please. To augment our respiratory and specialty franchises we're delighted with our recent agreement to acquire Bellis Health, a late-stage biopharma company working to better lives of patients suffering from refractory chronic cough or RCC. When completed the acquisition will provide GSK access to Camelopixant, a potential -in-class and highly selective P2X3 antagonist currently in phase 3 development for the first line treatment of adult patients with RCC. RCC affects around 28 million people globally and is defined as a persistent cough lasting for more than eight weeks that does not respond to treatment for an underlying condition. There are no approved medicines for RCC which has a significant impact on quality of life with some patients experiencing over 900 coughs each day. Camelopixant has the highest P2X3 selectivity in the class. Phase 2 reported a very low incidence of dyscusea, a taste disturbance attributed to P2X3 selectivity that frequently leads to patients discontinuing treatment. Phase 3 trials are underway and are expected to read out by 2025. We're confident that the phase 3 program will confirm a -in-class profile and provide an excellent addition to our specialty medicines portfolio building upon our expertise in respiratory therapies. Next slide please. In oncology we were pleased to report two significant developments adding to the support to STALAMAT. The Ruby trial presented at SGO and ESMO meetings in March demonstrated a 72% reduction in the risk of disease progression or death in the DMML population of patients with first line advanced endometrial cancer. In the overall population preliminary overall survival data showed a clinically meaningful trend and a 36% reduction in risk of death or progression in favor of the STALAMAT treatment. Endometrial cancer remains a significant unmet medical need. Over 400,000 new cases are reported annually with around 15 to 20 percent of patients presenting with advanced disease at the time of first diagnosis. We look forward to sharing these data with regulators as soon as possible. In February a US FDA advisory committee voted to support our proposed trial design to evaluate Jim Purley in treating locally advanced rectal cancer. The trial is now recruiting patients. Next slide please. As pipeline momentum continues to build in vaccines, HIV and infectious diseases this slide highlights important regulatory events and clinical data readouts anticipated in the next 12 months. A more comprehensive view of the portfolio is provided in the appendix. We anticipate an FDA decision for RxV or RSV older adult vaccine in early May with additional data to support the vaccine launch including those from a high risk 50 to 59 year old co-old additional flu combinations and second season outcomes. In oncology we anticipate an FDA decision for more melatonin in the treatment of myelofibrosis in June. We also anticipate presenting our data from the Bee Together Phase 2 trial which will provide evidence on the durability of response for hepatitis B patients receiving VEPI and interferon. Part of our program to develop a functional cure for some of the 300 million people living with chronic hepatitis B infection today. The continuous progress we are making underpins my confidence that our pipeline will drive growth in the latter half of the decade. Recent data, pipeline progression and business development have further strengthened our R&D portfolio and I look forward to sharing more data with you over the coming quarters and in future meetings. I'll now hand over to Luke on slide 15.

Thanks Tony, please turn the slide to the next slide. Strong commercial execution in the quarter continues to drive growth across our business and as you can see on this slide not only our product areas contributing to growth but we've also increased sales of each region and provided a balanced strong portfolio with room to grow. Our improved commercial execution capabilities will play an essential role as we launch new products of value coming through the pipeline and via BD including RSV vaccine for all the adults. Please turn to slide 17. This quarter we delivered strong performance with sales up 10% excluding pandemic solutions and in vaccine strong growth of 9% excluding COVID-19 solutions in the quarter was supported by Shingwix up 11% and meningitis up 25%. Shingwix delivered another record quarter of sales and a fifth consecutive quarter of growth including increasing contributions across all geographies. Shingwix is now available in 31 countries with 39% of sales coming from outside the US. In specialty medicines including HIV which Deborah will speak about shortly we increased sales by 13% excluding Zudy to 2.2 billion pounds. In immunology and respiratory we continue to see growth from our market leading medicines Benlista for SLE and lupus nephritis and eucala for severe asthma and other EOS driven diseases. Benlista continues to be the leader across all major markets however there's still plenty of growth with about 25% of bioprenetration in the US and even less in other key markets. Eucala remains the first and only biologic approved in four eucanophilic diseases with new indications driving growth and differentiation. In China the NIDL listing for eGPA has accelerated momentum setting the foundation for our upcoming launch in severe asthma and we look forward to our phase three COP data in 2024. In oncology sales grew 2% to 136 million pounds despite recent US label changes for blenorepanzidula and we remain focused on execution across the portfolio and look forward to the anticipated launch of momolotinib in monophilbrosis following the US Bidufidate in June. Our general medicines portfolio grew 9% to 2.7 billion pounds and the performance was predominantly reflecting the strong growth trilogy across all regions which grew 28% this quarter. We also saw a benefit from the strong allergy season in Japan and continued post-pandemic recovery of our antibiotic hormentin which contributed 177 million pounds further emphasizing our expertise in the space as we move forward with novel antibiotics emerging from our pipeline and BD efforts. Considering this Q1 performance we now expect general medicine sales to be broadly flat to slightly down in the full year. We remain on track to deliver our existing 2023 sales outlook for vaccine and specialty medicines and you can find these on slide 35 of the presentation. Please now move to slide 18. As Tony mentioned we expect an FDA decision for our candidate RSV vaccine very soon and RSV disease remained a significant unmedical need and our vaccine data showed exceptional overall efficacy particularly in the most vulnerable populations. We expect to be the first approved RSV vaccine in major markets including the US, Europe and Japan. Our teams have begun disease awareness activities where needed and our launch preparations are well underway. Overall we have a competitive vaccine profile with compelling clinical evidence and multi-billion shingrix-like annual sales potential and we look forward to keeping you updated as we launch this important vaccine. With that let me now hand over to Debra on slide 19.

Thanks Luke. Our HIV business delivered sales of £1.5 billion in the quarter in the first quarter of 2023 growing 15 percent. Our performance benefited from strong patient demand for our oral two drug regimens and long-acting injectable medicines contributing around 10 percentage points of growth. US pricing favorably contributed around five percentage points of growth. The inventory build we saw in the US in Q4 of last year has been slower to burn than initially anticipated. We continue to believe this burn this will burn through during the first half of the year. Davato delivered £396 million in the quarter. Market performance reflects HCP's belief in Davato which has become our number one best-selling medicine in HIV. We were also pleased to receive EU approval of TRIMEC PD in the quarter, the world's first single tablet dispersable regimen for children living with HIV. Turning to Cabanuba, sales for the quarter were £127 million, reflecting strong patient demand with high market access and reimbursement levels across the US and Europe. Our sales and medical teams are reporting positive customer feedback after releasing the SOLAR data at CROI and our new direct consumer advertising campaign is rolling out across the US. Moving on to prevention, sales of APRITUDE, the world's first long-acting injectable for the prevention of HIV, delivered £24 million in the quarter and we're pleased by the growing momentum across the US. We're encouraged by the progress of our pipeline which is focused on innovative long-acting regimens. We have three clear target medicine profiles to provide the and to provide -long-acting regimens for treatment and prevention with dosing intervals of three months or longer. We're excited about the potential of these medicine profiles and will be ready to regimen select in H1 2024. In summary, our Q1 performance positions as well to deliver the mid-single digit growth we expect this year and we remain very confident in our ambition to achieve a five-year mid-single digit CAGA to 2026. The changing mix of our portfolio towards long acting and the success of our pipeline offers the potential to significantly replace the revenue from the dollar tag of their loss of exclusivity and with that I will hand it to Ian on slide 20.

Thanks Deborah. As I cover the financials, references to growth are in constant exchange rates unless stated otherwise. As Luke and Deborah have covered the primary revenue drivers, I'll focus my comments and income statement including main cost drivers, margins, cash flow and guidance for 2023 including our latest phasing expectations. Turning to the next slide, before I go into the details of the quarter, I want to provide some context around the key factors influencing the performance of both total and adjusted results. As noted by the team, excluding COVID-19 solutions, we've shown strong operational delivery across the business, growing sales by 10% in the first quarter. Including pandemic solutions, sales were down 8% mainly reflecting lower sales of the ODI relative to Q1 of 2022. The 10% sales growth drove 5% of just operating profit growth excluding COVID-19 solutions. This included a four-point adverse impact from legal charges primarily related to the Zidula royalty dispute. Including the impact of COVID-19 solutions and those legal charges, adjusted operating profit was stable at £2.1 billion. On a total basis, the lower sales along with the Gilead settlement income of £0.9 billion in the comparator resulted in operating profit being down 15%. On earnings per share excluding COVID-19 solutions, there was 14% growth on an adjusted basis. The contribution from COVID solutions reduced this growth rate by 7 percentage points with adjusted earnings per share up 7% at 37 pence. Total earnings per share were 36.8 pence, down 8% on a continuing basis. Turning now to the main adjusting items of note between total and adjusted results for continuing operations in quarter, these were in transaction related with the net credit primarily reflecting leave contingent consideration liability movements, the majority of which related to foreign exchange. The currency impact was a favourable 5% of sales and 8% in adjusted earnings per share. Turning to slide 22, the adjusted operating margin was 30.1%. This was a 250 basis point improvement versus Q1 2022 at constant exchange rates. The improvement was primarily a function of the factors I've already described with lower sales of low margins of ODI benefiting cost of goods sold, partly offset by higher SG&A which included the legal charges primarily related to the Zidula royalty dispute. In addition to these factors, there was continued commercial and pipeline investment behind key products. Turning to the key cost line dynamics for the quarter, within cost of goods sold, the .1% point margin benefit was primarily from lower sales of low margin ODI but was partly offset by an unfavourable competitor to a one-time benefit from inventory adjustments in Q1 of last year as well as higher freight costs. SG&A growth was ahead of sales and an adverse .9% point margin impact. This primarily reflected launch investment, particularly focused on HIV and chinox to drive demand and support market expansion. There was also increased investment in preparation for the anticipated launches of our candidate RSV vaccine and momolans and nibble later in the year. The aforementioned increased legal charges added four percentage points to SG&A growth in quarter. R&D then grew 6% with continued investment across combination of both early and later stage programs, particularly in vaccines and specialty medicines. Within vaccines, this was driven by renumococcal, mRNA and phase II MMR programs. Within specialty, the early stage key assets included CCL17 for osteoarthritic pain and IL18 for immune-based diseases. In later clinical phases, there was a higher investment behind Jim Pearley, momoletanib, denimocomab and depraversum as those programs progressed. These dynamics were partially offset by decreases related to completion of late-stage clinical development programs for TILMAB, cell and gene therapy discontinuation and reduced R&D investment in Blenref versus Q1 of 2022. Royalties benefited from Bicarby's contribution, which included an additional month in 2023 versus last year. And note that our guard-soul royalty stream will cease at the end of this year. Moving to bottom half of the P&L, I'd highlight that net finance expense mainly came from the net savings from maturing bonds, including the sterling notes we purchased in the fourth quarter of last year and higher interest income on cash, and that non-controlling interests were lower due to Q1 2022 other non-controlling interests not repeating. This was as expected. On the next slide, I'll cover cash flow. In the first quarter, there was a free cash outflow of 0.7 billion pounds. Within free cash flow, cash generated from operations decreased to 287 million pounds, down 88%. This primarily reflected an unfavorable comparison due to upfront income from the settlement with Gilead received in the year. There was also an increase in seasonal inventory and lower payable balances reflecting increased investments in 2022. Below cash generated from operations, there were higher tax payments. Q1 performance from cash generation was in line with expectations and were on track to deliver outlooks this year. Turning to slide 25 and considerations for our guidance for 2023. We delivered a good start to the year and are very much on track to deliver full year guidance. Given Q1 performance, we now expect full year pay to be slightly different to that shared in February. Our Q1 performance benefited from slower than expected HIV inventory burn and particularly strong general medicines delivery due to anti-infectives market recovery and Japan allergy season dynamics, which we don't expect to persist through the year. For the second quarter, we expect to see de-stocking in HIV and for general medicines growth to moderate due to the seasonal effects. We therefore expect sales growth in Q2 to be lower than Q1. With these considerations in mind, we now expect first and second half sales growth to be broadly similar. And within this, we now expect general medicines to be broadly flat to slightly down for the year. In the second half, we continue to expect the sales growth to be influenced by the parator periods. In HIV, these included US channel inventory build and favorable US pricing, particularly in Q4 of last year. In gen meds, there was a post-pandemic recovery in the antibiotic market and the launch of FloVent authorized generic in the US in the second quarter of last year. For this year, we would also expect ongoing pricing pressure in gen meds, especially in the US and European pricing pressure in the HIV market. With respect to operating profit growth, we still expect this to be lower in the first half of the year compared to the second half relative to full year expectations. This is informed by continued investment behind ongoing and anticipated launches, including our RSV vaccine and momoletinib. As such, we expect SG&A to grow ahead of sales in Q2 and we still expect SG&A to increase the rate broadly aligned to turn over for the full year. On COVID-19 solutions, we still do not anticipate significant future sales. However, based on Q1, we are revising the estimate for full year adverse adjusted operating profit impact to be 5 to 6 percentage points. We're off to a good start in 2023 with good momentum. And with that, I'll hand it back to Emma.

Thank you, Ian. Turning to slide 27. We have made building trust by operating responsibly an integral part of our strategy and our culture. Ultimately, we are focused on delivering sustainable growth with returns to shareholders, reducing risk, helping our people to thrive and delivering health impact at scale. Our responsible business framework prioritizes six material areas. Last month, we published our ESG performance report on our progress in each, including a new overall ESG rating that showed on track based on 83% of all performance metrics being met or exceeded. On access, one of the most material areas of social responsibility in our sector and one where we are committed to lead, we made further progress again by expanding availability of our HIV prevention medicine, Cabotegravir, to 90 countries by signing an agreement with generic manufacturers by the medicine's patent pool. And we've also enhanced recruitment of diverse patient populations with 100% of our phase three clinical trials now including a demographic plan, as well as also making great progress in creating a diverse, equitable and inclusive workplace. Turning to the final slide, 28. So we are off to a strong start in 2023 with all our growth drivers performing. We're very focused on our upcoming launches, including our potential RSV or the adult vaccine, and on continuing to strengthen our pipeline organically and through targeted business development in vaccines and specialty medicines. Our continued momentum commercially and in the pipeline support our confidence in delivering on our outlook and ambitions to sustain our growth through this decade and beyond. And we look forward to sharing more details at upcoming events. Before closing, of course, I would like to recognise the outstanding contributions made by Ian McKay as our CFO. This will be his last quarter, indeed it's his last week, before retiring from GSK. Ian has been a fantastic leader, great colleague and has made an enormous impact in his time here. And I really want to sincerely and personally thank him. Julie has been transitioning into the role with Ian and is officially starting in just a few days. And I know she's very much looking forward to spending time with you all as we continue to deliver progress together. With that, Nick, now I think you're the master of ceremonies coming into the Q&A.

Absolutely, thanks Emma. So just as a reminder, if you'd like to ask a question, please join the queue by raising your hands or alternatively press star nine to raise and lower your hand on the phone. And given that there are currently 15 people polled for Q&A, can I ask that you please keep questions to one to two so we at least give everyone the opportunity to participate. And with that, our first question is coming from James Gordon.

Please go ahead,

James.

James, you may need to press star nine to unmute.

Okay, what we'll do is we'll move to Kerry, Kerry Holford. So Kerry, over to you please.

Hi, can you hear me, Nick? Yes, we can. Excellent. Lovely. And a couple of questions, please, on Kamla Piksant. Tony, you highlighted that around, I think you said 28 million people suffer from RCC globally, but I'm wondering are there perhaps specific patient subgroups and or markets that might be most amenable to drug therapy in this disease, perhaps more severe patients? And then I'm wondering whether you're willing to discuss potential peak sales that you might target for this asset? And I might just check the last one. The competitor Merck has clearly faced issues with evidence measurements in this space. How confident are you that your asset here won't suffer the same fate? Thank you.

Thanks very much, Kerry. So this is Kamla Piksant, obviously delighted to have announced the deal with Ballas. And I'm going to ask Luke to pick up on the dimensions of opportunities in subgroups. I mean, it's 28 million, but there are more than 10 million who've been living this with this for more than a year. So we are very excited about the best in class potential and the meaningful contribution that will come after a 26 launch. But Luke, I know you've been very close with all of this from the beginning, so perhaps a good comment on the relative competitiveness.

Sure. Thanks, Emma. And thanks Kerry. Look, I think the important thing here is there's a temptation to focus on the 28. So that's all people that technically had cough for more than eight weeks. But in our modelling of the peak sales and the uptake, we concentrated exactly to your point on subgroups. So people who have had refractory cough for longer than one year, so they're more likely to present a pulmonologist. And then we've taken various other cuts around access, compliance, etc. And then you get, as we put in our slides announcing the deal, is about 3.3 million potential patients in the US and around three in Europe and about half of that in Japan. So it's quite a sizeable group. And what is interesting when you look at numbers being managed right now by pulmonologists, about 1.8 million patients being managed right now by pulmonologists in the US with ICC. Now, the true number is actually high because many of them unfortunately are sent back to the primary care because there's limited options in terms of resolving that. So that's why we think this is a multi-billion product. And what I would encourage you to do is if you have discussions with physicians treating these patients, there are two things I'll tell you. One, frustration in terms of the options available. And then secondly, unprompted, they'll remark on the large volumes of patients that they see. And so you assemble all these things. It's a very compelling asset. I think, as Merck, I'll let Tony comment on the filing, but the pharmacological profile and the selectivity around P2X3 versus P2X2, this is an incredible, incredibly durable, robust differentiation, even if we have equivalent efficacy. And of course, the upside is that we have an edge on efficacy versus Merck. But the tox profile is just so much more compelling for the Merck product. And that, again, that's the third thing that physicians make the point around in terms of the class.

Luke, just to underscore that point, two things about Merck comparison. To put some numbers around selectivity, the unpleasant taste dyskosia, which is a significant impact on patients discontinuing therapy, is driven by selectivity over the P2X2 receptor class, for which Tamnipixant has a 1500-fold margin. That's an enormous margin relative to the class and of the order of 150 times greater than the Merck so we're very confident in our ability to improve side effects with regards to that particular selectivity. And indeed, you see that in the phase two studies where there's only a 6% incidence of dyskosia for Tamnipixant. The other issue is with regards to a data treatment or analysis issue associated with the cough countering device. We have exactly the same device and approach as Merck. As far as we can tell, their CRL was based on the methodology used for data analysis where we are on ongoing conversations with the regulator and we're confident that we'll be able to work through that data treatment issue, particularly given the medical need for this area that Luke emphasized.

Next question please, now.

So next question is from Steve Scala. Steve, over to you please.

Thank you, can you hear me?

Yep.

First, I'd like to clarify when does GSK plan to initiate phase three trials in adults and infants for the 24-valent pneumococcal vaccine? It is still listed as a 2024 readout but it's not identified as a catalyst any longer in 2024. Thank

you. Thanks, Dave. So straight to you, Tom.

Yeah, so we will start the phase three study for adults with the pneumococcal 24-valent vaccine at the beginning of next year. That represents an acceleration relative to the acquisition objectives. You'll have noted that we have a pause in our 24-valent infant program. This is associated with an audit finding with regards to the fill finishing presentation of the vaccine. We are still very confident in the overall profile of the vaccine. In fact, our confidence in the technology continues to grow as we see emerging data from competitors in the field. So I'm very confident with progression here. We're working to get the 24-valent infant vaccine study back on track as soon as possible.

Excellent. Next question please.

So the next question is from Graham Harriot, Bank of America. Over to you, Graham.

Great, thanks for my questions. So firstly, just on RSV vaccine, just any kind of level of confidence you can give over the likelihood of approval into the ADCOM next week and in particular, given that Bavaria Syndrome was obviously raised in both the ADCOM and the ACID meeting, so whether there's been any further requests for data or information relating to that. And then secondly, the timing of the two-season data, I think you said data collection ongoing and update mid-year, but has the FDA requested you to see any of that data and do you think you'll have that data in time for the June ACIP meeting and how does that play into pricing decisions ahead of launch? So if you have that data but it's not part of a June ACIP recommendation, can you price this for a two-year vaccine at the outset or are you going to have to start thinking about adjusting pricing post-launch, for example?

Thanks, Graham. So I'll come to Tony first and then Luke on the specifics of pricing, recognising that when you're a week away from going through the regulatory process, pronouncing what's going to happen, we'll have varying degrees of specificity on that and likewise in a competitive situation on pricing, but both of those we should respond to.

Yeah, where I might start, James, is just emphasising the profile of our vaccine. I'm sure you will recall particularly with regards to the at-risk populations with regards to hospitalisation where we see 94% vaccine efficacy. That profile for efficacy and the overall safety profile of course was recognised in the VIRPAC vote for our vaccine which we were delighted to see. We continue to randomise patients on the phase three study. We randomised for the second season to receive second vaccination and placebo which gives us the opportunity to make an appropriate comparison with regards to second season data. I'll remind you in the first season that our data acquisition was determined by event rate, for the second season it's determined by the close of the second season and we remain on track to acquire that data along with other data that we are building the picture for the quality of our vaccine in particular. Data for flu Coad where we'll be moving into the high dose and adjuvanted setting. Again, I'd remind you that on the basis of data we have so far, we are the only vaccine for which Coad shows no impact on the performance of either vaccine. We're also adding data from the at-risk 50 to 59 population. We expect to have all of those data ahead of ACIP as Emma indicated and Luke perhaps I can hand over to you with regards to the question for pricing.

Thanks Tony, thanks Graham. And yeah, it's reinforced, I mean Tony and his team are incredibly focused on this timeline so our working assumption is that we have that you know in an unusual scenario that we just missed a deadline which as I said we do not expect, I think it would depend on the robustness of the signal but my working assumption is if we had that second season then we would price it at the upper end of the range and we've signalled in the past that the range is the time we're between high dose flu which is in the 60s and Shingrix which is 185. Of course it's now moving more towards the right hand side of that midpoint and if we had that second season then we'd be very much on the right hand side of that midpoint.

Thanks Luke.

So next question is from Richard Parks at BNP Paribas.

Hi thanks Nick, hopefully you can hear me okay. Just got two questions, firstly on Shingrix, I just wondered if you could disclose what underlying US volume demand growth was when you X out the stocking differences and maybe you could just update us on ex-US launches where you're seeing most traction and how that will evolve through the year. Then second question was for Tony on business development and R&D. Many of the recent track transactions have added late stage programs such as Momolitinib, Cambler, Picsant that will help cushion patent expiries that you'll experience later in the decade but they don't necessarily bring platforms or technology that can help to improve GSK's longer term R&D productivity. So my question for Tony is now that he's been in the seat a little bit longer if he feels confident GSK's invested enough through business development to retool the company in terms of technology platforms and capability for it to be competitive and improve internal R&D productivity longer term. Thank you.

Thanks so much Richard and obviously I'll ask Luke to comment on Shingrix where we see a lot of growth ahead and then we'll come to Tony. I mean we remain, you said is it a have we done what we need to? This is always an ongoing piece of work and it's always at the core of our strategy in R&D and you're absolutely right we are focused both on assets and on platforms but Tony can make some more specific commentaries on where we're at but Luke to you first. Thanks

Richard. So in terms of the market research if we look at pharmacists Shingrix is now number one priority and some of the challenges that they had around staffing and elements like that have been resolved. If we look at primary care positions and intention to recommend vaccine again it remains unchanged so all those things are pointing in the right direction. If we look at TRXs then over 60% of them are first dose which again is very consistent so these are all encouraging elements. In terms of Q1 it was influenced by two distinct events which I think will start to be washed through in Q2. The first one was we had an inventory online versus Q1 22 so in Q1 22 it was 0.9 this quarter it was 0.6 and as we've discussed on lots of calls before the steady state is around 1 to 1.2M doses a month so we expect and there are signs that that's normalizing now and then the other thing is linked to that the strength of retail is very much driven by the 65 and above which you would expect with the removal of the copay. As you know commercial patients don't have a copay and then the second element influencing this is that we had a lower non-retail quarter one performance due to a very specific element which I won't go into but it is thoroughly addressable. We expect to recover those patients in Q2 so you put those two things together that's what explains the numbers but as I said very strong. If we look ex-US, 39% of the growth we continue to pick up reimbursement decisions, we've got expansion in Japan, we've just picked up Australia in a number of markets in Europe, we're now really starting to get traction on early days in China in terms of the recovery and then of course in the long term we're very focused on the booster in that IC population but also potentially people with an additional comorbidity to come back and re-challenge the original cohort.

Great and then in terms of technology platforms I'm delighted with the platform access we have and the progress we're making. I might start actually in the vaccines area and refer again to the Finnevax which I feel is the leading protein complexation technology that's available. We're obviously making great progress in our partnership with QVAC and with regards to RNA and you saw some of the data that is exciting us in phase one at least in the context of flu and COVID earlier in the year and that to our already existing capacity in vaccines with subunits structure-based vaccine design and adjuvants illustrated nicely through the RSV vaccine that we've just been talking about and I think we're in an extremely solid position. With regards to vaccines technologies you'll remember that we added in the medicines part of our business we added access to what we believe is the strongest oligonucleotide platform at the moment in the context of a multi-target deal with wave therapeutics. So as far as what I would refer to as platform technologies I think we're in an excellent position. We obviously as Emma indicated remain vigilant to further areas of development. In data technology I would add collaborations like the one that we signed with Tempest recently which will be about helping us identify patients in oncology and spot the right combinations. Obviously they go on top of existing collaborations in data and human genetics and functional genomics like 23andMe and LGR for example giving us access to cutting-edge technology. So I think we're extremely well placed across the board with regards to both platform and data technology although you will continue to see that as a theme of business development as I look to augment capabilities when appropriate target identification needs emerge in the portfolio.

Great thanks Tony.

Nick? So next question is from Andrew Balmer

City. Andrew please go ahead.

Yeah thank you. A couple of questions. First for Deborah on Veev. Could you talk to the anticipated impact of the rollback and continuous enrollment under Medicaid on Veev? My assumption is the economic impact for the group is going to be limited because of the lower profitability and programs like Ryan White will plug the gap as anyone loses coverage but if you could tell me if those assumptions are incorrect. And then second for Luke you've spoken about the potential for line agnostic indication for momolotinib in MFS. We're waiting obviously the label. I'm sure the NCCN has already reviewed the data. Assuming that you do get line agnostic approval do you have any sense of which category recommendation NCCN will rate if you are to challenge Jackafee in that setting? Thank you.

Right Deborah

and

Luke. Great thanks Andrew. So I think you're talking about the Bravewood ruling when you're talking about some of the challenges externally in the environment. So if not stop me. But basically the Affordable Care Act mandates coverage by commercial payers so that they cover preventative services without cost sharing which is very very important. A number of employers with strong religious beliefs don't want commercial insurers to cover PrEP in HIV and are judging Texas found in favor of the plaintiffs. And therefore the Biden administration has actually appealed against this judgment because actually it doesn't just tackle HIV for PrEP but actually it's really undermining one of the court planks of the Affordable Care Act that preventative services would be covered by commercial insurers. So it's got a number of different layers and that court case which I think will go all the way up to the Supreme Court probably going to take a couple of years. So from our perspective there's two things. We don't think there's going to be short-term impact. We're going to watch and wait see what happens in the court case but also obviously we work very closely with the community and with the various bodies in the kind of the US administration and their view is that they are going to put in place policy and other reforms to ensure that the Affordable Care Act mandate around prevention remains in place because of their commitment to it. The other thing that's ironic is obviously the government and in fact it's bipartisan, the commitment to ending the HIV epidemic has set a goal of ensuring that 50% of people who are eligible for PrEP, so that's about 600,000 people of the 1.2 who are at risk, should be prescribed PrEP by 2025. So it's not just butting up against the Affordable Care Act mandate but it's also undermining the ending the epidemic initiative which is why we know from all of our government partners they are going to fight to maintain this very strongly and they've got some clear things that they're going to do from a policy perspective and other reform options to make sure this isn't impacting their mandates. So for me it's a watch and wait but I'm not expecting any short to medium term impact. Let's see how it plays out.

Thanks

Deborah.

So Luke, one last thing.

Yeah thanks Andrew and as you know that the base case for the deal was second line anemia patients, so Jack exposed with anemia. Anything if we did get a first line label you know there's clearly an upside there. I will have to bite my tongue, I don't want to speculate because you can imagine we're in discussions with a number of people right now. What I can tell you is that you know we are very clearly stating that is the only agent with profound clinical and endurable benefit in terms of splenar solace and symptom relief with patients with anemia and I think that is landing incredibly well. If we look at unaided awareness coming out of Ash it's quite striking. It's around 32% which is double the typical benchmark in hematology and when you look at aided awareness it's around 75% of physicians and what is also interesting we're not actively out there making this point but already you've got 60% of treating physicians indicate that one of the top three reasons that they switch patients is because of issues with anemia and transfusions. So it's a very fertile environment for us to arrive in and we're hoping that the NCC and NCC and recognise that in terms of the labelling and language in the guidelines.

Yeah very much looking forward to that George.

Thanks we've got eight minutes left I'm mindful that there is another call starting at one o'clock so if you can keep your questions short that would obviously be appreciated. So that's why we're the answers. Exactly. So James back to you at JP Morgan please.

Hello James Gordon, JP Morgan and thanks for putting up with my early IT meltdown. Two questions, one on Zantac and one on M&A. Sort of linked together though that Zantac said that the Sargon hearing wasn't quite as positive as the MDL but latest thoughts on what that could mean in terms of liability and when this all could get wrapped up by and given the need to maybe have some funds to address any potential Zantac damages are you a bit sort of sent up on BD for a while? Is there still room to do much more BD or do you have to set aside some funds there and could you put the Haleon stake to work could you sell that then you've got the ability to do some more BD? And the second question also on BD and M&A. Which is a therapeutic strategy I think it was more oncology and then I thought the focus was more infectious disease but Bellas to me looks a bit more like general meds respiratory. Could you be more of a focus now?

There's absolutely no change in our focus here James but let me try and succinctly respond to that. So first of all no news, new news on Zantac, very confident in our position, obviously respectfully disagree with the conclusion in California. We're going to work through that case that's coming up in the summer delighted with the federal dismissal at the end of last year and continue to defend our position vigorously. Completely independent of that BD remains absolutely core in terms of our R&D strategy. It is part of the way like the rest of the industry that we do R&D. It's been one of the biggest changes we've driven in the company over the last few years delighted with the deals that we've announced recently and as you alluded to it was absolutely core to the structural transformation that we've made of this company with the de-merger of Halion, the resetting of the balance sheet and new step change in operating performance to generate more cash and obviously competitive but appropriate distributions direct to shareholders as well which is created in all of the different areas of the business which we are deploying we think smartly in ways with a lot of financial disciplines that contribute meaningfully to our growth. We are confident of great momentum this year, the five-year outlook and we're looking forward to adding to that the growth ahead and there is total consistency in terms of what we've said we are prioritizing in terms of our BD. That is vaccines and specialty meds as the core priorities. That doesn't mean we haven't taken advantage particularly in building out our anti-infective priority because we do have expertise and infectiousness such a core global unmet need the silent pandemic that will kill 10 million people a year if the industry doesn't address antibiotics. We've got a nice set of tuck-ins that Luke has led for us there but the core priority is vaccines and specialty assets and platforms and within our TAs we have four that we work on infectious diseases HIV immunology respiratory and of course oncology which is a small but emerging area for us where we've been pragmatic and we've just talked about normal ultimately which we're excited about coming up for so hopefully that covers all of your questions and the next one please.

So next question is going to come from Seamus Fernandes at Guggenheim

so Seamus over to you.

Seamus, do you have that? Yep I'm just getting the instructions on how to unmute. Just one question really wanted to get a sense of the company strategy in flu with mRNA and how you're thinking about the competitive landscape. We just got some I guess mixed data from competitor Moderna at their recent vaccine stay but we'll get some additional data in the back half of this year so just love to see how you're thinking about the mRNA flu opportunity for GSK and what you're seeing as it relates to the competitive landscape. Thanks so much.

Sure well I mean let's start by saying we're excited about mRNA technology the earlier data we've seen and we expect to continue to invest more in mRNA as our portfolio. I think instead of the competitive landscape maybe Luke you could just comment a little bit on how to see that.

Sure so I mean as you know we have no presence in high dose so anything that we can extract and penetrate there is upside. You know our working assumption is that there will be a tolerable mRNA vaccine developed and of course we have the partnership with CureVac. I think the advantage of mRNA of course is just the speed at which you can go from bench to the neck and that is not relevant for areas like shingles but it is profoundly relevant when you're seeking to select strains and predict a future season and so any compression enabling greater certainty in terms of the leading hemisphere to select those strains is going to produce a more effective vaccine and hopefully shift it above 50% that we see in a typical year. So our working assumption is it's going to be very disruptive and I think the combination of COVID in the partnership with CureVac is also very attractive and our expectation is that the urgency around COVID is going to be reduced but flu is going to be durable and therefore 2 plus 1 vaccine is attractive. I don't know Tony if you wanted to mention anything in terms of the program that we've got.

Yeah just to underscore the point that Emma made at the beginning if we look at the developments in mRNA in the field in general I think they're all adding up the need and importance to secure a therapeutic index with regards to the gap between immunogenicity and reactogenicity and as I mentioned earlier the data that we disclosed or our partner CureVac disclosed earlier this year I think give us a good start with regards to expectations that both sequence modification and use of modified bases are going to give us a strong position.

Great Nick any time for any more?

Last question so apologies to those that we weren't able to get to but our last question comes from Simon Baker at Redburn so Simon over to you please.

Hi Simon. Thank you Nick for taking the question I'll be brief but just quickly wanted to get a quick note of thanks for Ian for all the help and assistance he's given us

over

the years. Two quick questions firstly on Camerapixent although RCC is obviously a very big indication I just wonder if you'd give us any thoughts on potential beyond RCC given P2X3's implications in areas like overactive bladder and endometriosis and secondly on Japotidacin a fabulous job on the development side arguably the big challenge to come is on commercialization so look I just wonder if you'd give us some thoughts on how you think about selling a new differentiated antibiotic which historically has been somewhat of a commercial challenge. Thanks so much.

It's a great point because I know there's been an enormous amount of thinking from Luke and his team on the demographics across our anti-infectives portfolio where we are confident we're going to deliver financial returns so we'll come to you in a minute on this but perhaps first Tony you can comment on life cycle innovation possibilities on Camerapixent by the way also which is primarily a female patient profile as well in RCC so interesting.

Yeah and look Simon Hi first of all of course our focus in Camerapixent is increasing the degree of penetration into the enormous unmet need for the 30 million patients that suffer from refractory chronic cough. I'm sure you followed this if you looked at the co-localization of the P2X3 ligand-gated iron channel with regards to sensory afferents you could imagine utility and pain migraine urgumentary incontinence but our focus is really to establish the profile of the molecular phase three in RCC where we see the biggest need and immediate opportunity.

Thanks Simon yeah and I think we're very excited about the profile that's been achieved in phase three with Tony's team. You know if you look at typical broad spectrum antibiotics they are reserved because as you would expect people want to retain potency and avoid resistance there's also incentives around you know in hospital use in terms of DRG disincentives that don't come into play here and I think that the main argument if someone was to to challenge on you know the risk of resistance is hepatitis and it has been developed specifically for pathogens that are resistant in and limited to use in uncomplicated UTI and gonorrhea. So it's not a reagent that's going to be used for you know post-operative infections, staph, etc. So and the other problem we have is if you look in the US is around 15 million episodes a year about a quarter of those are recurrent and they're resistant or the patient is allergic or intolerant for three or more antibiotics so this is a growing group. The typical strategy of course is to try nitroforanthin and others but about a quarter of these patients positions employ fluoroquinolones which as you know are broad spectrum antibiotics so they're actually contributing to the problems. Their argument is displaced fluoroquinolones use hepatitis and which has a much lower risk of resistance and of course you're not you're not destroying activity in other other pathogens which could be used for more aggressive infections and then you've got the commercial scale that we can bring and the logic as Emma has outlined of assembling tebipan and hepatitis and brexifem is that we get enormous synergy across the specialty groups and the primary care doctors that are

all right. So I think that wraps up our call today great start to 2023 with all growth drivers performing and good momentum very focused on the upcoming launches and continue to strengthen our pipeline organically and inorganically all of which underpins our confidence the outlooks ahead. Thank you everyone.