Orion Corp New B Shs

Good afternoon and welcome to Orion's Q1 2026 results webcast and conference call. My name is Tuukka Hirvman and I'm the head of IR here at Orion. In a few moments, we will kick off with a presentation by our CEO, Liisa Hurme, after which you will have the possibility to ask questions either from Liisa or from our CFO, Rene Lindell. We will be first taking the questions through the conference call lines, and after that we will turn on to the webcast chat function. So you may also type in your questions using the chat function of this webcast. And to our Finnish-speaking viewers, this event is held in English, but afterwards, later this afternoon, you will find a Finnish interview of Orion CEO Liisa Hurme on Orion's website. And just before letting Liisa to step in, just a reminder about this disclaimer regarding forward-looking statements. With these words, I'd like to hand over to Liisa.

Thank you, Tuukka, and good afternoon on my behalf as well, and welcome to Listen Orion Q1 2026 results. Some highlights from this Q1. All our businesses performed solid, in a solid way, and very well, I would say so. And we also have good news regarding our clinical pipeline. We've been granted, ODM 212 has been granted for fund-raising designation in mesothelioma by FDA, now in April. And we've also started a new Phase 1b-2 study called Eat Coke, which is a basket trial evaluating ODM212 in combination with standard of care treatments in patients with selective advanced solid tumors. And I will talk more about that later on. Also, we have strengthened our executive team. We have appointed Mr. Barclay Vincent as an executive vice president to lead innovative medicines division, and as a member of my executive team as of April 8th. So let's look at the financials. Net sales, a healthy growth of almost 18% compared to the previous year's quarter one. Also operating profit growth, 47%, which brought us to operating profit margin of 27.5%. and earnings per share increased 47%. Looking at net sales in more detail, Innovative Medicines drove the net sales growth with royalties and tablet sales. But as I already mentioned, all the divisions are performing well, of course, in relation to the size of the division. Randy Burke's growth was 5.2 million, Generics 1.1 million, and Animal Health 1.1 million, and even Fermion external sales grew 1.8 million, ending up to 480 million euros of net sales during Q1. And the operating profit consists, of course, The royalties here in the column 3 close to 41 million euros and change in sales volume of 21 million euros. We of course see some effect on decreasing prices as we usually see. The biggest product suffering of this are of course index and dexter but there are other generics as well. This comprises or comprises of 9.3 million euros. That also includes effects and changes in cost of goods. No major milestones received in Q1. And then we also see increase in our fixed costs. And thus our operating profit was close to 150 million euros during Q1. Now to innovative medicines. The division growth was close to 54%. And here we can see the Nubeka royalties and doublet sales of 145, close to 145 million euros. Some other business of 5.4 million, which is usually sales of services to our partners, resulting 150%. million euros of net sales. And as we remember from the previous years, we start with the lower royalty rate from there in the beginning of the year. So the royalties are tiered during the financial year. And we see into one clearly lower income of Nubeka compared to the last quarter. of previous year, but clearly a higher revenue, Nubeca revenue compared to the previous year's quarter was. And royalties were 95 million euros and tablet sales to their 50 million euros. Branded products close to 7% growth compared to previous year with 82.2 million euros EasyHealer continues to drive growth in this division, especially budesonide formaterol, as the recent changes in treatment guidelines from last year favor the use of combination products over the mono products. And we've been able to really increase our sales according to this new guideline. And the good growth momentum in women's health. therapy area continues with the HRC products. Generics and consumer health, 1.4% growth. It's, according to market growth, maybe slightly below that, but this is only one quarter, and we all know that this is really a very wide portfolio in many different geographies, so this is a very good achievement for the first quarter. and animal health 3.3% growth. Of course, again, a very wide portfolio, both for companion animals and livestock, and a global portfolio, and the growth comes from all of the different geographies in both segments, or both units. When we look at the top 10 products, of course, we see the Nubeka, as we discussed, driving the growth, Easyhaler, 7% growth. Entacapon, slightly minus compared to the previous year's quarter one, but this is mainly, again, a timing issue of deliveries to different regions and different partners. Same goes with the dexamethoran and the animal health PDA portfolio, number four here, which grows almost 11%. It presents And that is again a result of deliveries leaving during year one. And as I mentioned, women's health continues with growth trajectory with almost 15% growth. At Burana, slightly decreasing, almost 6%. That's also a kind of more of a timing issue and depends on the season. But then we see Three of our generics, Trexan, Ketiapine, and Foreston, which have a very, very healthy growth. This is partly due to the previously mentioned timing of deliveries to our partners, but also showing that, for example, Trexan is a golden standard treatment globally used both in cancer and autoimmune diseases and holds a solid position in our top 10 products. And FINDUX, as I already mentioned, facing a heavy generic competition in Europe. Now, Innovative Medicines during the quarter one comprised 36% of our net sales and generic 32% and branded products 20%. Animal Health and Fermion together were 11%, 12% of our net. Our clinical development pipeline has now, or the list is now a bit longer, with the new combination study for ODM212. But I'll go through the list to remind us what we have now going on. So the two first ones are studies on Nubeqa, the Duffel-Hiccup, or the Nea212s of darolutamide in prostate cancer, ARPSTEP, for the biochemically reoccurring prostate cancer. Omaha 3 and 4 are studies for metastatic castrate-resistant prostate cancer with opethesostats molecule that Orion has developed and then outlicensed to MSD. Then a bit of an odd A product on this list, which is otherwise oncology products or molecules, is Levocimendan. It's an old classic from Orion's portfolio, the same molecule as we have in Symdax, and that's developed for pulmonary hypertension. And there are two phase three studies ongoing with that by our partner, Tenax. Then two phase two studies, again, with Opevesostat, for women's cancers, like breast, endometrial, and ovarian cancer, MSD by MSD. And this is, of course, to test whether this mechanism of action would also work for hormonal cancers in women. CYPIDES is still ongoing. That was the phase two study that was used when the phase three studies with Opebesostat started, so the results of that study. were used for planning of that, those phase 3s. T-DEF is a monotherapy study, a phase 2 study for ODM212, for malignant pleural mesothelioma, and also for epithelioid hemangioma endothelioma. These are two very rare cancers, solid tumors, And we think that this molecule, based on its mechanism of action, should have a direct anti-tumor activity to these cancer types. And the new addition did co, co referring to combinations. The indications here, the cancers are mesothelioma, non-small cell lung cancer, and pancreatic cancer. We are combining ODM212 with some known drugs that are used for these specific cancers, and we use the other kind of mechanism of bead inhibition, which would fight for the drug resistance or prevent the drug resistance that patients usually show to these currently used treatments. Sustainability. As another topic, some key figures of Orion's sustainability programs. We've been able to decrease our greenhouse gas emissions by 13%, and this is scope one and two, so it doesn't include the scope three. Our injury rate is 4.9, and there is clearly room to improve there. For this year, we have very... ambitious targets for LTIF. And then two things regarding more of a kind of code of conduct or how we operate within our own company and with our suppliers. This has to do with the code of conduct. In Orion, 98% of our employees have carried out or done the training for code of conduct. Also, we do this code of conduct training and agreement with our suppliers and 96% of our suppliers are also adhered to code of conduct, our third party code of conduct practices. We have specified our outlook for this year. We gave our outlook in January, and now after Q1, when fourth of the year has already passed, we are a bit more wiser, and we are able to increase the lower limit of our range by 50 million, both on net sales and operating profit. So the net sales range was 1.9 to 2.1 billion euros, in the original outlook and now it's from 1.95 billion to 2.1 billion. And same with the operating profit which was previously 550 million to 750 million and now it's from 600 million euros to 750 million. And here are some upcoming events for this year and I think at this point I thank you for your attention, and I think it's time for questions.

Yes, thank you, Liisa, for the presentation and setup for today. And now let's turn on to the questions. We will first start with questions on the conference call line, so at this point I would like to hand over to the operator.