Galderma Group Ag

Welcome to Goderma's 2025 third quarter trading update call. As customary, the press release was published at 7 a.m. Central European Standard Time today and can be viewed on our corporate website at any time. Today's presentation slides, as well as a recording of the webcast, will be made available on our website after the call. Please be advised that today's presentation contains forward-looking statements, which should be treated with the appropriate level of caution as advised on the slide. Let me now introduce today's trading updates webcast. Dr. Flemming Ornskov, CEO of GoDerma, will provide performance highlights for the third quarter. Thomas Dietrich, CFO, will then present the trading update and the financial outlook for the full financial year. Both Flemming and Thomas will be available to answer questions from financial analysts before Flemming provides his final remarks to close the webcast. With this, I would like to invite Flemming to start the GoDerma's highlights for the third quarter of 2025. Flemming, over to you.

Thank you, Emil. Good morning, good afternoon, and welcome to Gelderma's third quarter 2025 trading update webcast. In a year of opportunities, we delivered record net sales for the first nine months, along with strong commercial and innovation momentum across our portfolio. For the first nine months, Gelderma delivered 3.7 billion US dollars in net sales. These results are ahead of expectation, driven by focused execution of both the existing portfolio and new innovation. Growth was driven primarily by volume, complemented by favorable mix. For the period, net sales growth was up 15% year on year at constant currency. Growth for the third quarter was up 21% year on year at constant currency. This represents an acceleration across all geographies and product categories, despite challenging market dynamics. The growth was especially strong for Nemluvio in the U.S., while newer modulators benefit from some favorable facing in the third quarter. Based on our strong growth trajectory across the portfolio and Nemluvio's performance, we are raising our full year guide. For net sales growth, we expect to close the year between 17 and 17.7%. For core EBITDA, we expect a margin between 23.1% and 23.6%, both at constant currency. Our performance demonstrates our ability to deliver growth through commercial excellence, innovation, and global expansion. Let's look at some highlights by product category on the next slide. Galderma continues on its strong growth momentum with net sales growth acceleration in the third quarter across all product categories and geographies. Galderma achieved double-digit growth in both injectable aesthetics and therapeutic dermatology, reflecting broad-based growth momentum and successful commercial execution for the first nine months of the year. Dermatological skincare continued on a strong trajectory, especially in international markets. Globally, all three product categories outperformed their respective markets. Both geographies delivered double-digit growth, as did most of Galderma's top 10 markets. Our performance reflects focused commercial execution across our core business as well as incremental growth opportunities, as you'll see on the next slide. Let's start with injectable aesthetics, focusing on our newer modulator portfolio. Our next generation newer modulator, RalphieDesk, continues to ramp up well in the 17 markets where it was already launched. Feedback remains very positive, and we are progressively gaining market share, mainly from competitors. I'm happy to share that we received three new approvals for Ralphie DES in Hong Kong, New Zealand, and the United Arab Emirates. This last one arrived just in time for us to showcase Ralphie DES at the Aesthetic and Anti-Aging Medicine World Congress in Dubai. The Congress took place in early October, and you can see some visuals on the right side of the slide. There was a lot of excitement. We look forward to the launch next year in a market where we currently do not have a neuromodulator offering. We also completed multiple additional RaffiDesk submissions globally, progressing in our plans to have the broadest neuromodulator portfolio globally. The neuromodulator subcategories overall has been performing really well with market share gains in the US and in international markets. If we focus on the European countries where Ralph Fidesz has launched, we see early signals demonstrating the strength of our newer modulator portfolio strategy. Over the past 12 months, our newer modulator portfolio gained 490 basis points of market share. And in the third quarter, the portfolio delivered double-digit growth, with Dysport growing well and Ralph Fidesz continuing to ramp up. Moving now to fillers and biostimulators, where we continue to invest for growth. We gained further market share in fillers and biostimulators in international markets and in the US. Restylane continued to be impacted by a soft filler market, while Sculptra maintained a very strong growth trajectory with double-digit growth across geographies. I would like to showcase two specific efforts which are stimulating growth for this category. Global activities on our proven injectable treatments for improving facial appearance after medication-driven weight loss. We believe that we're best positioned in this space with our clinically proven portfolio of sculpture and the full Restylane range. We provide a leading education and training for healthcare professionals, leveraging the first-of-its-kind clinical trial data focused on patients' experience in patient volume loss associated with a medication-driven weight loss. We also commissioned clinical consensus guidelines, which set a standard approach for identifying and managing the unique needs of this patient population. And in the US, we launched a significant direct-to-consumer campaign called Sculpt and Lift, targeting patients on GLP-1 treatments. We believe this is an important opportunity to increase demand for the Galderma offering As the campaign aims to bring medication driven weight loss patients to aesthetic practices. This includes patients who may not have been aesthetic users before. Second, we continue to scale reasonably large differentiated innovation. This includes the ramp-up of Restylane shape in Brazil, which created a total new segment. As a bone-mimicking filler, it offers an outcome which could previously only be achieved with invasive plastic surgery. The launch continues to progress strongly, with a positive halo effect on the rest of the portfolio of Restylane in the market. The other significant launch was Sculptra in China, which is on a very strong growth Our Chinese team has been executing an exemplary omni-launch strategy to increase awareness and penetration. Two of the achievements I find particularly impressive. Over 100,000 units were sold in the first six months of the launch. Sculptra is already the number one search brand in bio-stimulator locally with over 200 million impressions. Switching now to Dermalogical Skincare, we continue to focus on the core of our business while also introducing new innovation to capture opportunities for further growth. Starting with Cetaphil, we further expanded its range to address white spaces. This included two totally transformative launches in the US, creating entirely new categories based on proven science. The skin activator hydrating and firming line. It marks an entirely new skincare category of advanced hydration and firming solutions, designed specifically to improve the appearance of aging, thinning, and fragile skin. This also marks our first step in strengthening our position in the faster-growing hands and body lotion segment, where we historically have been underrepresented in the U.S. Second, the nourishing oil-to-foam cleanser represents a breakthrough in hydrating cleansers for sensitive skin. This first-of-a-kind formula is designed to deeply cleanse while preserving hydration and supporting the sensitive skin's moisture barrier. As the essential first step in any skincare routine, it also removes sunscreen and makeup, making it ideal for double cleansing or as standalone use. In addition, GALBERMA continued to roll out recent innovation in international markets. This includes multiple Cetaphil lines, especially in the fast-growing Asian and Latin American markets. We're also using these to strengthen our position globally and capture local opportunities. For example, the gentle exfoliating SA line was launched in China, strengthening our offering in the face segment. For Elastin, the preferred period procedure skincare brand in the US, we broadened our reach and leveraged synergies with our injectable aesthetics portfolio, following an launch for our partnering healthcare professionals, we initiated a broad consumer outreach for our restorative skin complex with next-generation TriHex technology. This has been another successful launch, turning the improved formula into one of Elastin's top-selling products. It also received Elle magazine's Feuder of Beauty Award for top skin tightening cream, reinforcing its position for medication-driven weight loss patients. Second, we continue to expand and international markets for the launch in China were excited to introduce elastin to the second largest precision dispensed market globally. Turning to therapeutic dermatology, Nemluvio remains on a strong trajectory, especially in the US. Nemluvio continues to surpass expectations underpinned by growing demand and increased access. This is reflected in Emluvia's growing share of total prescriptions and paid new patient starts. If we look at the six-week rolling average of paid new patient starts, also known as NBRX, from September to early October, Emluvia was trending at about 37% market share in Borrelia nodularis and 7.3% in atopic dermatitis. As a result, atopic dermatitis sales became the larger contributor in the third quarter. Overall, the majority of patients starting on Menluvio were new, yes, new to advanced therapy. This demonstrates the value perceived for Menluvio in these indications by healthcare professionals who have prescribed the product to their patients. Last, but of course not least, we continue to expand access for patients. The percentage of patients covered by commercial plans with broad access to reimbursement has surpassed 80%. For both indications, Nemluvio is reimbursed as a first-line biologic treatment with no need to first go through another therapy. Meanwhile, in international markets, Nemluvio's uptake continues to be strong in Germany. We have now launched Nemluvio in Austria, Switzerland, the United Kingdom and Denmark, while progressing on price negotiations with multiple other markets where Nemluvio is already accrued. A number of additional regulatory submissions globally are also in progress. As you can see, Galderma continues to perform strongly, advancing our growth drivers across the portfolio and reinforcing our leadership in dermatology through new data presentations and world-class education programs. I'd now like to hand over to Thomas to cover the sales performance in more detail, as well as the outlook for the remainder of the year. Thomas?

Thank you, Flemming. It's my pleasure to comment on Garderma's Q3 2025 Trading Update and Outlook, starting with an overview of net sales for the period. As mentioned by Flemming, Garderma continued on its strong momentum, achieving a record 3.737 billion U.S. dollars in net sales for the first nine months of the year, up 15% year-on-year at constant currency. For the third quarter, this represented an acceleration to 21% year-on-year growth at constant currency. This was higher than expected for the quarter, based on strong performance across the portfolio, and especially from Nemnubio's ramp-up, along with some favorable phasing in Euro modulators. Growth was broad-based and continues to be driven by volume, complemented by favorable mix, which more than offset adverse price impacts. Looking now at injectable aesthetics, net sales were 1.871 billion U.S. dollars, up 10.5% year-on-year at constant currency. Neuromodulated net sales were 1.053 billion U.S. dollars, up 14.0% year-on-year at constant currency. Both the U.S. and international markets delivered double-digit growth, outperforming the markets and gaining shares. Growth was driven by strong performance of Gizport in both the U.S. and international markets, along with the ongoing ramp-up of Relfides. Newer modulator growth in the third quarter was 12.6% in constant currency, ahead of expectations, benefiting from strong execution, as well as some favorable phasing between the third and support quarters. Fillers and buy simulators net sales were $818 million, up 6.2% at constant currency for the first nine months. Again, Galderma grew faster than the market and gained share in both the US and international markets. While fillers overall continue to be impacted by market softness, Galderma's performance was supported by the growth of differentiated products and especially new launches, including Rest in Shape in Brazil, as Clemming presented earlier. Biostimulators maintained very strong momentum with outstanding double-digit growth in both geographies. Sculptor remains our fastest growing injectable aesthetics brand. Growth was especially high in international markets with widespread performance and strong contribution from China, where we just launched the brand earlier this year. Next. Moving to dermatological skincare. Net sales for the first nine months were $1.063 billion, with a year-on-year growth of 8.2% at country currency. Calderma outgrew the market in dermatological skincare globally, with the majority of our key market gaining share, despite some constrained consumer spending. Growth in dermatological skincare was led by international markets, our larger geography, where both Cetaphil and Elastin grew double digits. I would also be remiss not to mention Cetaphil's continued outstanding trajectory in fast-growing Asian markets, especially in India and China. In the U.S., performance was impacted by constrained consumer spending. Nonetheless, Cetaphil in the U.S. saw positive responses late in the third quarter from multiple promotional activities. Meanwhile, Elastin continued to deliver double-digit growth in the U.S. Now, on to therapeutic dermatology. Net sales reached 804 million U.S. dollars for the first nine months of 2025, up 40.4% year-on-year in constant currency. Growth was driven by NEMluvio's continued outperformance, which more than offset the expected decline in the mature portfolio. Nenuvio's net sales for the first nine months were $263 million, predominantly from the U.S. and ProRigo Nodularis. However, the topic dermatitis representing the larger market opportunity overtook ProRigo Nodularis sales in the third quarter for the first time. As formulary coverage for patient reimbursement increased significantly, the results for the third quarter reflect managed care rebates resulting from securing commercial coverage. For the mature portfolio, excluding Hemluvio, performance was impacted by anticipated lower volumes and pricing pressures globally, especially in the U.S. Nonetheless, we also saw some positive momentum in international markets, where we capitalized on our strong portfolio in Acne and Rosacea. Now, looking at net sales geographically for the first nine months of the year. The majority of our top 10 markets grew double digits, with particularly high performance in key international markets, such as India, China, Mexico, Germany, and the UK and Ireland. Both reporting geographies accelerated their growth momentum, noting the US growth was especially fueled by the Nimluvio ramp-up. International, which remains the larger of our two reporting geographies, continued its strong growth momentum with 13.2% net sales growth at constant currency. Injectable aesthetics delivered double-digit growth in most key international markets, including in Europe, Latin America, and Asia Pacific. Both neuromodulators and phylogenetic simulators grew double-digit, outpacing the market and gaining share. Neuromodulators saw growth across markets. Fleming already shared some highlights for Europe, which delivered the greatest growth contribution supported by the launch of REL FIDES. Growth for neuromodulators in the third quarter also benefited, as mentioned, by some favorable phasing relative to the fourth quarter. For fillers and biosimulators, Restylane Gage gained share in most key markets against a soft backdrop for fillers. As for Sculptra, we delivered strong growth and outstanding performance across international markets with some markets growing even triple digits. This includes markets where Sculptra is already well established, especially in Latin America. Following the launch earlier this year, Sculptra continues its strong ramp up in China, the second largest injectable aesthetic market globally. Dermatological skincare also delivered double digit growth internationally. ahead of the market, driven especially by continued outstanding growth of Cetaphil in Asia, especially in China and India. Alactin also contributed to strong growth from the ongoing international expansion, albeit from a smaller base. Therapeutic dermatology growth was primarily driven by the ongoing rollout of Nemluvio also internationally. Moving now to the U.S. Net sales growth was 17.5% year-on-year at constant currency. The growth contribution was particularly strong from the ramp-up of Nemluvio while injectable aesthetics and dermatological skincare grew modestly. Both neuromodulators and psilocybin virus stimulators outperformed the U.S. market and gained share. Growth was especially driven by Dysport and Sculptra, both growing double-digit, while Restylane outperformed a declining filler market. This sport in the U.S. also benefited from some favorable phasing between the third and fourth quarter. In dermatological skincare, we navigated a constrained consumer spending environment in the U.S., especially impacting C. difficile. Nevertheless, C. difficile in the U.S. saw positive responses late in the third quarter from the multiple... Now moving on to tariff exposure in terms of the U.S., our exposure to tariffs that are already in effect is deemed manageable. Tariffs are mainly relevant for our U.S. fillers and biostimulator portfolio, which represents approximately 7% of our total Galderma net sales. Please recall that any tariff would be on the import value, thus exposing only a portion of the in-market net sales price to tariffs. Furthermore, it is important to remember that our in-market net sales price charged to healthcare professionals is typically only the smaller portion of the end consumer treatment price. Also recall, more than 90% of all injectable aesthetics products currently sold in the US are being imported. Our guidance fully factors in the exposure to all tariffs that are already in effect. Any further tariff announcements will be reviewed as to their potential impact during the remainder of the year if any. Given the importance of the US market, let me also remind you that we continue to expand our US operations. Earlier this year, we announced our new US headquarters in Miami, Florida, complementing our already established corporate and R&D hubs in three other US states. We continue to provide significant healthcare professional education and training events across the country. We have committed to spend more than 650 million U.S. dollars on U.S. manufacturing activities through third-party manufacturers over the next five years. This includes ramping up final assembly and packaging for Nemluvio in Florida, as well as the manufacturing of elastin and select Cetaphil products with our contract manufacturing partners. Also, Galderma and its partners have initiated additional technology transfers to the U.S., focusing on key growth drivers, including double-sourcing Relfides in the U.S. Now, on to guidance. We are raising our guidance for the full year, as Flemming already mentioned. This reflects our strong growth trajectory across the portfolio and especially of Nemluvio. We are raising net sales to 17.0% to 17%. 0.7% year-on-year growth at constant currency from previously 12% to 14%. On core EBITDA, we are raising the margin range to 23.1% to 23.6% at constant currency from previously approximately 23%. The guidance update especially reflects the significant ramp-up of Nimluvio, which is driving growth in therapeutic dermatology. It also reflects the strong trajectory in injectable aesthetics, with continued outperformance of the market in both neuromodulators and fillers and biosimulators. In neuromodulators, the fourth quarter is expected to be impacted by phasing effects. Full year net sales growth for neuromodulators is expected in the low teens constant currency. At the half year call, I translated low teens as 11 to 13%, as you recall. As we have now delivered a strong third quarter growth rate, our full year performance is largely de-risked, and we expect growth towards the upper end of this 11 to 13% growth range. In fillers and biosimulators, expectations for the fourth quarter are to maintain the recent growth momentum based on the strong trajectory of Sculptra and from new launches. Dermatological skincare is expected to accelerate its growth momentum to reach high single digit growth at constant currency for the full year. And finally, for the therapeutic dermatology mature portfolio, the Q3 year to date performance is indicative of our expected full year growth for this part of the business. The updated core EBITDA margin reflects reinvestment into growth for the group and to support Nemluvio's strong ramp-up. It also factors in the exposure to all US tariffs that are currently in effect. Any further tariff announcements will be reviewed as to their potential impact during the remainder of the year. Please note that the updated guidance also has implications on the additional modeling metrics which were previously provided in the financial results. In particular, The increased profitability is expected to positively impact the effective tax rate for the full year, putting it towards the lower end of the previously provided 23% to 25% range that we provided at the half-year call. This concludes the introductory remarks of Galderma's trading update for the third quarter of 2025. Before we close the meeting with Fleming's final remarks, I would like to now hand back to the operator to open the call for questions. In the interest of allowing sufficient time for all analysts to ask questions, I would kindly remind everyone to please limit your question to one each. Operator, can you please now open the line?

Thank you so much. Dear analyst, if you would like to ask a question, please press star 1 1 on your telephone keypad and wait for your name to be announced. To withdraw a question, please press star, 1 and 1 again. Please turn back. We'll compile the Q&A and all studies. We'll take a few moments. And now we're going to take our first question. And it comes from the line of people bothering from Morgan Stanley. Your line is open. Please ask your question.

Yes, thank you very much. The question is just on Nemlujo for the rest of the year. When we triangulate your comments on the business trends in Q4, it's clear to us that Nemlisio is the biggest moving part in the guidance. So if you could just tell us where you see the most variability here. Is it the uptake in atopic dermatitis in the US? Is it the X-ray uptake? Any sort of help you can give us on where you see the moving parts for Nemlisio in Q4 would be helpful.

Yeah, I don't know if I agree with your analytics. First of all, thanks for the question. It's 263 million so far. You can see we have reported 3.7 If I can do the math, that's not the majority. We had double-digit growth in injectable aesthetics. We had double-digit growth in therapeutic dermatology. We had 8.2% growth in dermatology skincare. So I think we have to be a little bit careful not to think that this is about Namluvio. Namluvio is in a very early stage of its trajectory. It's performing or outperforming any benchmark we've set. We're at 7.2%, I think, share at this stage. If you look at NBRXs for the AD market, and we're at 37. If you look at PN, we are now north of 80% commercial coverage, and next year we'll enter most likely into the Medicare, Medicaid. But we have a lot of other things that are growing incredibly fast, and Nemluvio is important, but it's not the only thing. And if I think about the contributions of Cetaphil internationally, if I think about the contribution already of Ralph Fidesz, if I see the very strong performance of Dysport around the world, I think it was a little bit, we need to moderate that sentiment.

Any further questions, Thibault?

Yeah, no, I mean, I think the question was just on the moving particular, but that's fine, thank you.

Yeah, we don't manage the company with just one company, we have You know, we shift the resources, and I think we've seen, you know, we have broad growth in international and in the U.S., 17.5% growth in the U.S., 12-plus percent in international. And if you look at the portfolio, it's almost all products that are showing incredibly strong growth, not just in nuclear. Thank you.

Thank you. Now we're going to take our next question. And the question comes from Harry Sefton from UBS. Your line is open. Please ask your question.

Brilliant. Thank you very much for taking the question. So in fillers and biostimulators, we saw another strong quarter against the backdrop of a weak HA filler market. Should we think about the vast majority of that growth being driven by Sculptra? And how should we think about the growth going into 2026 for Sculptra, given the push into GLP-1 patients? Do you think you'll be able to accelerate the growth to Sculptra next year? And then also thinking about Restylane growth going into next year, given the launch of skin boosters in the US and a couple of other SKUs.

Thank you. No, very insightful question. Thanks very much. Yeah, sometimes one gets lost in the minutiae details. If you take a step back, your strategic comment is totally right. Over time, in the combined category of fillers and biostimulators, sculpture, the biostimulator part is approaching half and will probably overtake it sometime next year. What we are seeing, but these are early signs, you should talk to all our competition, is there a flattening on the negative trend with fillers. Yes or no, your insights may be as good as ours. What we are seeing is that if you launch new and innovative fillers, like what we've seen with Restylane Shape, we have uptakes that matches some of the best launches like Restylane Kiss, Restylane Lift we've had. So I think it's a bit of a mixed bag. There's pricing pressure, there's commoditization, but if you bring innovation to the market, you see that. unique advantage for us in one of the largest markets. We're going to be launching, I think, up to six new products, several of them being fillers next year in the U.S. If all goes well, we're in the final stage of regulatory approvals for those. So that should give us a boost. But it is quite clear that the trend among consumers is, yes, we all want a newer modulator. And now we also want a biostimulatory product. And then we add on a filler. But for treatment of some of the effects of significant weight loss with GLP-1s, you will need both a filler and biostimulatory product. It's early days to say how growth is thriving. In certain parts of the world, if you go to the Middle East, it's a significant part. In the U.S., it's still early days.

And then I would only add, when you asked about 26, and we're not going to comment on 26, Harry, but on the longer term, When you think about the bio-stimulator opportunity, remember we just launched in China, and the bio-stimulator opportunity longer term in China is so big, it's bigger than the sizes of most injectable aesthetics markets in JPEG. So that's where we just launched, and then together with Fleming's comments, think of the longer-term secular trend that we have here And that's really big and amazing.

That's brilliant. Thank you.

Thank you. Now we're going to take our next question. Just give us a moment. And the next question comes from the line of Shyam Kotadia from Goldman Sachs. Your line is open. Please ask your question.

Hi, thank you for the question. A quick one on Nemluvio. So in terms of the guidance going forward, you mentioned in the prior results that you're going to consider your greater than 2 billion peak sales guide for the drug. So given the ramp continues to be strong, do you have any update from that perspective? And also any update in terms of the breakeven assumptions, which I believe previously were 2027, and also your assumptions hit blockbuster run rate was also 2027. So any update in regards to that would be super helpful. Thank you.

Yeah, I don't think at this stage we're going to give guidance on Nimluvio apart from what we've already said. It's 2 billion plus. When we look at the data, the uptake continues to be very strong. I think part of this success with the launch so far is we keep the head to the ground and we focus on building out the sales force, making sure we get access, making sure we do well against a very tough competitive set. that we get as many doctors to experience the product so that they also can prescribe it to more patients. There's a lot of change going on. We used to be mainly dependent on PN. Now we see that AD is a larger part in the third quarter. That was the largest part. So net-net, of course, with this strong uptake, if it continues to that way, we will at some point consider resetting the guidance for peak sales and of course also the profitability threshold guidance.

Yeah, and on the profitability, I mean, let me just comment there on 2025 because this is the Q3 2025 call. Recall that we said that we expected in the H1 call, we expected the adverse P&L impact from Nemluvio launch investments and other investments to be 60% in H1 and 40% in H2. Let me update that here with by saying that in H1 we have seen 75% of the adverse PNL impact and it'll be only 5% in H2 driven by the strong uptake. But also remember A strong uptake doesn't happen by itself. You need to reinvest some of those proceeds to make it happen in the following period. And that's what we have done very judiciously. So therefore, driving the strong uptake will bring the break-even point in at a later stage when it's the appropriate time. But we're on a very good trajectory here, as you see, also from a profitability standpoint.

Very, very sorry. It broke up a little bit when you said it will bring the break-even point. Can you just repeat that last bit on the break-even point?

Yes, it will bring the break-even point in because the strong uptake delivers additional profitability. But we don't want to comment on that right now. We set it back today. It's sometime in 27. So let's not get into any details. We will do that at the appropriate point in time. Thank you very much.

Thank you. Now we're going to take our next question. And the next question comes from the line of Benjamin Jackson from Jefferies. Your line is open. Please ask your question.

Great. Thank you for the question. One on Relfordess, if I may. I think you've spoken fairly positively about it for a number of quarters now in the ongoing launches. But is there perhaps any more depth in the colour that you can provide to us, even around the relative sized in terms of the entire neuromodulator number that you're putting out. And then thinking about your strategy and how you launch it, is there more color you can provide about the uptake, but also how you balance the commercialization process between Dysport and Relford S, and then how that matters for the U.S. too? Thank you.

Yeah, I think you have to take the background here. Since 2019, when we as a team took over, We have shown incredible growth of Dysport around the globe. So, of course, we continue to support Dysport. It's an incredibly strong product. It competes well against Botox. We're launching it even in more and more countries. So for us, that's the most important product we have right now. We're now launching another product. And the way we've launched that is we know that in the new modulator space, there are still... I'm not sure I caught any, like, three-quarters of that due to the line breaking up.

I don't know whether you could repeat it at all. Sorry about that. I'm not sure if it's just me.

Sorry about that, yeah. Sorry about that. We're really sorry about that. Okay, good. Okay, so I apologize. Strong results, not so strong technical execution today, so I apologize for that. But do you want me to repeat the answer? It was a bit long, but I'm happy to repeat it. Is that what you would like me to do? Please, that would be really useful if so. Thank you. I really apologize for these technical issues. So what I was saying is that the way we, since 2019, have basically been strengthening the commercial execution for Dysport. I think the way we've gained market share, in some cases, we've gained leadership. It's a very strong product. I think you see in most geographies, including the US, we continue to gain significant market share also against Botox. So when we had the opportunity to launch Ralphie Des, initially in some European countries, the focus was, of course, to maintain the strong momentum of Dysport. We know that there's room for additional optionality among doctors and patients. Ralph Vides offers certain benefits. Of course, fast onset, it's liquid duration. And the doctors that have started using Ralph Vides, we see that they continue to have a strong preference for that. But we still need to keep in mind that the vast majority of our sales today is disporred. So what our key strategy is to continue to drive our overall share of the neuromodulator market, and given we're now number one in Europe, number one in Australia, number one in Brazil, holding in the US, I think the strategy is working. And remember, our play in injectable aesthetics is a portfolio play. We have multiple opportunities for you to use fillers under the Restylane name, we have sculpture and now in many countries we have two options for you if you want to use a newer modelator and we think one of the core strengths of our gaining market share and honing in on leadership and aesthetics is because we have a broad portfolio approach thank you thank you for coming out over again thank you now we're going to take our next question

And then the question comes from Yihang Li from Barclays. Your line is open. Please ask your question.

Hey, Yihang Li from Barclays. Congrats on the call here, and thank you so much for taking our questions. I guess I have a question on memory view treatment dynamics. So I acknowledge, you know, the most launch is still at a very early stage, but I'm still wondering, what is the average treatment duration so far in PN and also AD indications separately? So based on our research, it seems like the switch-out rate for Namdoville remains at a very low level, but slightly increased a little bit in third quarter versus second quarter. So just curious, any observations on his communications rate or patient experiences so far? Thank you so much.

Yeah, there's one advantage of being the CEO and a physician is I interact with a lot of physicians. I just spent time yesterday with two of them. So they both have a very large number of patients on the product. And I go together with my colleagues on many field visits. So what you're observing is also what we hear back from the physicians and we're seeing in the market research. The dropout rate has been really low. We still see that every four week is the preferred duration, but we are now seeing that doctors and stable patients that have been itch-free, slept well at night, that they're now thinking about going, or have already started to go to every eight weeks, which they see as a huge advantage. So what we're seeing is that The initial feedback from patients and physicians has been reconfirming the fast itch release. It's reconfirmed the very positive impact on sleep and quality of life. It also has been surprising for many physicians that they feel that the skin clearance is above what their expectations. They had strong expectations in PN, but maybe not so in AD, and they are in the patients they select to be in the product. So the fact that we also can be used first line, the fact that we have a very large portion of our patients being biological naive, it all probably speaks to the fact that for the moment, along with incredibly strong access, 80 plus percent in commercial plants, we see low dropout rates. Of course, like any IL-13 and IL-31, it's not going to be for everyone. You know, the physicians have choices to make, but The good news is a lot of physicians are starting to use Namuvio as first line, given its safety profile, given what the fast it relief, but it's way too early to comment on that. And we've just basically started to launch in certain parts of the world. We're building out the field force. We've just launched DTC. So it's way too early at this stage to make big, bold projections on the brand.

The other part that helps a lot is the tolerability. Fleming mentioned the lack of side effects, so to speak. But the other part is just that it doesn't seem to sting as much because it's against the main competitor from a large French company. The volume is much, much lower. It's about a quarter. So therefore, the convenience of having to auto-inject yourself, and that's also factors physicians tell us that help people wanting to stay on the ground because it's just convenient and highly tolerable, it doesn't hurt as much. So that's some of the learnings we're getting there. Just complimenting, I think it's common.

But the most important is to realize, you know, we're on a journey. We're basically well into the launch of PN. We're basically now starting significantly in the launch of AD. When you speak to physicians and what we see in market research, that the ones that started to use Nemluvio particularly in PN initially. They had a lineup of patients that had been difficult to treat for them with other products that didn't want the JAK. So we probably got a pretty severe group of patients initially. Now we're moving into, I think, a broader group of patients and also first line in many cases. So we'll see where that takes us.

Thank you very much. Very helpful.

Thank you. Now we're going to take our next question. Just give us a moment. And the next question comes to the line of Victor Floch from BNP Paribas Exxon. Your line is open. Please ask your question.

Thanks very much for taking my question, Victor Floch, BNP Paribas Exxon. My question is on REL Fidesz, and I was wondering if you could comment on the timeline for securing the U.S. capacity And whether bringing this capacity online might shift your neuromodulators product mix further towards real Fidesz, considering that the rest of your token portfolio is still expected to be manufactured out of the UK. Thanks so much.

No, our focus is still, and Ipsen is doing an excellent job, is to continue to manufacture in a reliable manner. In the history, we had some stockouts, but we've had a very good record now. of delivery on time and that's very important because with the very strong growth rate that we're seeing with Rapid S, we had a bit of subdued launch in Europe because we're new to the manufacturing of neuromodulators. We built a totally new manufacturing site in Sweden, so we were a little bit cautious that we would not run out of stock and we have not done that. We prioritized which countries we were launching in. The other thing that was very important and is still impacting a little bit about our launch trajectory for Ralphie Des is we have to run a lot of batches to prepare for the filing of the complete response letter with the FDA. So we have choices to be made all the time between making sure we have supply for the products, the countries where we're also launched, and making sure we have batches enough for answering all the questions that we have to answer with the FDA. As I see right now, because remember, it's a lot of batches that have to be running. We have to do testing on these batches. Everything seems to be going in the right direction. Whether it's going to be in December or flip into January, I do not know, but I think we're in fact.

Thank you. Thank you. Now we're going to take our next question. And it comes to the line of Richard Vosser from J.T. Morgan. Your line is open. Please ask your question.

Thanks very much for taking my question. A question on Rafa Dessen and the approval in the UAE. Obviously, as you said, Fleming, no presence there. So I'm just thinking, how would you size the opportunity and how you would attack that opportunity in other areas where you don't have Dysport under your control and how we should think about the opportunity in those areas for Relford S. Thanks very much.

Well, the Middle East is a region that is near and dear to because we go through a lot of challenges in that region. So we set out on a venture, which was not an easy venture through arbitration and, of course, in case of kind of lawsuit, to try to ensure our ability to sell our products in the region. So, first, we've made really good progress with fillers, now with sculpture. Now comes the next stage, which is with Rapides. We will be, you know, because Rapides is approved by the EU, it will be launched at the beginning of the year. It's a region that continues to surprise me. I recently was at a conference, MWC, in Dubai. I heard that there'd be 3,000 people at the conference. I think there were 6,000 people there. And I saw the interest in Ralphides, which we just got approved in time. So I cannot quantify at this stage, but it's also coincides with the fact that this is one of the regions where there's also very significant treatment for GLP-1. It's almost OTC. So I think both what we're seeing for sculpture and for fillers is very strong growth. And I imagine now having the full armarium with Ralphides, should help us to secure more market share overall in injectable aesthetics. And as you know, a lot of people from different parts of Europe are gravitating towards now also putting their clinics in UAE. And the bigger market is, of course, KSA or Saudi. So we say that it's a great opportunity, but it's going to take a lot of time.

So I'm optimistic about it, but it's going to take a bit of time. But if I just add from a profitability standpoint, realty debt in the Middle East is super attractive because from the first unit onwards, it's royalty-free. We don't have to pay any royalties to Ipsen. So that's also very attractive, profitability-wise. And it is, of course, an added grant over time will be a contributor to our profitability margin expansion.

Thank you very much. Very helpful.

Thank you. And now we're going to take our last question for today. And it comes to the line of Natalia Webster from RBC. Your line is open. Please ask your question.

Hi there. Thanks for taking my question. It's just a follow-up on what you mentioned around wealthiness and contribution to margins. Are you able to comment a bit more on when you expect this to be a meaningful driver to margins? Do we still need to see the U.S. approval and then those royalty caps to be reached in major markets for this? Thank you.

Yeah, thank you, Natalia. Yeah, you're right. I mean, from an overall margin standpoint, think about what Clem just said earlier. These ramps go slowly, steadily, but this is really sticky stuff. But it ramps slowly, and remember, you'll never have a patent cliff either. So you really want to do it the right way. The doctors like it, patients like it. They are in the driver's seat. The doctors are in the patient-doctor discussion. So that's what it is. And then from a margin standpoint, I just said, look, there are some geographies like UAE and Middle East that are royalty-free because we did not have the right to diasporic there. So that's really attractive. So there you have a contribution right from the get go. And then other territories in which we have the right to diasporic, that's in various geographies and there you have to hit certain levels. Really in the US, once approved, we would get, given the size and growth of the market, we would get to that threshold quicker. than in the other territories where we have to pay royalties so there it takes a little bit longer but overall a very good trajectory and the excitement from patients seeing that fast onset and healthcare professionals fast onset and the long duration that's really what what we should focus on and profitability will follow and it's very attractive for us so that that will almost take care of itself

Thank you very much for the question. Thank you, Thomas and Flemming, for the answers. I want to pass over to Flemming to give his final remarks so that we can close the webcast.

First of all, thank you so much for your thoughtful questions and also for your patience. I think you'll recognize that we're good at commercial execution. Maybe we need to be a little bit better at meeting execution, but we always strive to improve. The good news was it happened on a day when we had strong results, so you couldn't accuse us of trying to hide something. So as we highlighted today, we continue to be on a very strong trajectory, very focused execution, both on our existing portfolio and new innovation. I can hear a few of your questions. You're very excited about a lot of new innovation, but don't forget the vast majority of the growth is coming from our existing portfolio. We delivered 3.7 billion US dollars for the first nine months record, growing 15% at constant currency. widespread growth across product categories and geographies. Of course, you all honed in on Nebuluvio, very strong growth in the U.S., but we also, with neuromodulators, that also showed very strong growth. We also had some benefit from some facing in full transparency. A lot of questions from you on U.S. tariffs. I think Thomas gave you a crystal clear answer with what we see today is factored in to the 2025 guidance, but it is a bit of a moving target. U.S., as you can see, is very important for us. Neuromodulators, Cetaphil, now Nemluvio, and of course, we also will invest significantly in the U.S., $650 million, as you may have read, U.S. dollars up to 2030, because we clearly need to increase our manufacturing footprint there, and given the importance of a number of products, elastin, Nemluvio, and Cetaphil, that's a necessary investment. And I think, as you've seen, strong growth directory, Nemluvio, strong performance. We've opted for your guidance, I think not by a small percent, but significantly both on top and bottom line. And with that, again, thank you so much for your thoughtful questions today and have a great rest of the day.