Sandoz Group Ag S/Adr

Good morning, ladies and gentlemen, and welcome to the Sandoz Call today. I will now pass on to Craig Marks, Head of Investor Relations, for his opening remarks.

Thank you, and welcome to the Sandoz 9 Months 2025 Update Call, which focuses on sales. We plan to publish our full financial results for the year on the 25th of February. Earlier today, we published a press release and an accompanying presentation on our website, which will follow on today's call. You can find these documents at sandos.com stroke investors. Joining me on today's call are Richard Saylor, Chief Executive Officer, and Remco Steenbergen, Chief Financial Officer. Please turn to slide two. Our sales announcement, presentation, and discussion include forward-looking statements. Please see our disclaimer here. Please turn to slide three. Richard Saylor. We'll begin today's presentation with a summary of the highlights from the first nine months of the year, followed by an update on the business. Remco will cover the sales performance, as well as full year guidance. Following the wrap-up of the presentation, we'll be happy to take your questions. With that, I will now hand over to Richard. Please turn to slide four.

Thank you, Greg, and hello, everyone. It is a pleasure to welcome you all to today's call, and I'm looking forward to taking you through another strong Sandoz performance. Please now turn to slide five. I am pleased that the momentum in our business has continued. We are making excellent progress on our biosimilar launches and the pipeline, as well as delivering strong, ongoing commercial execution. In the first nine months, we achieved 5% net sales growth at constant currencies, though the underlying result amounted to 6%. In Q3 alone, growth further accelerated to 6% at constant currencies and 7% on an underlying basis, with buyer similars growing by 13% at constant currencies. We also saw good performance across all geographies, including a significantly improved result in North America. In line with our commitments, we've successfully introduced several key medicines this year, including Pischiva, Wyost, Gibonte in the US. Looking ahead, we are preparing for additional launches, notably Wyost, Gibonte and Afclear in Europe, as well as Tyruco in the US. These launches will further strengthen our commercial footprint and long-term growth potential. This momentum supports our confidence in upgrading our full year core EBITDA margin guidance today. We continue to expect net sales to grow at constant currencies by mid single digit percentages. And while we anticipate that the core EBITDA margin will be in the range of 21 to 22%. Now let's move to more details of the business performance starting with slide six. This was our 16th straight quarter of growth primarily driven by biosimilars that represented a record 31% of net sales. The effect of this positive mix of sales, as well as the momentum in the business, was a key driver in the decision to upgrade our core EBITDA marketing guidance to date. Please turn to slide 7. Before we deep dive into biosimilars, let's take a look at generics. In the first nine months of the year, we've delivered a full launch program with 115 medicines launched and around 280 total launches around global markets. Notable launches include Listex and Insucrose in the US. Our pipeline is strong, with over 400 assets currently in development, targeting around $220 billion in originator sales, covering approximately 65% of LOE opportunities. It is worth noting that our generic growth of 2% this year has been materially impacted by a shortfall in our penicillin B2B business. This began with the imposition of US tariffs that led to reduced associated exports from China to the US. In turn, this then prompted Chinese suppliers to very significantly lower prices for key penicillin APIs, including some that we sell to other businesses. As the last remaining fully vertically integrated producer in Europe, we are pleased to see a growing recognition by policymakers the need for sustainable European supply of penicillins. But more action is required, and we call on the European Union and national governments to implement measures that reduce geopolitical exposure and safeguard the long-term sustainability of European produced penicillins. Please turn to slide 8. Turning now to biosimilars, we achieved half of our 2025 biosimilar launch milestones so far this year, and we are fully on track to deliver the balance by the end of the year. In the first half, we launched PeaceGiva in the U.S., followed by the successful rollout of the first Oosterkinema biosimilar auto-injector in Europe. Our quarter two launch of Wyost and Gibonte in the U.S. have also gone extremely well. These were the first and only interchangeable denosumab biosimilars in the U.S., providing new affordable treatment options for over 10 million patients. I'm looking forward to the remaining biosimilar launches before the end of the year, namely WIOST, JUBONTI, and AFCLIR in Europe, as well as TYRUCO in the U.S. Please turn to slide 9. Biosimilars continue to be a powerful growth engine for Sandoz, delivering constant double-digit performances and enhancing our margin. Our biosimilar portfolio is not only growing, but evolving through strategic launches, geographic expansion, and innovation. Let me now dive into the performance of our biosimilars, starting with Peace Jeeva on slide 10. It is encouraging to see the overall biosimilar ustekinumab participation in Europe increasing, outpacing the adoption rates we saw with adalunumab. This signals a growing confidence in biosimilars among healthcare providers and payers. We've seen strong momentum in Europe, where Pisgiva has quickly gained traction following its launch last year. This has been supported earlier this year by the successful European launch of the first biosimilar ustekinumab autoinjector, our European market share has been broadly stable in a market experiencing strong growth. Finally, we're planning for additional Pestiva launches next year, including entry into exciting markets like Brazil. Please now turn to slide 11. Switching to Heimer Wars, now our largest selling medicine, it continues to demonstrate strong and consistent performance globally, with stable market share amid rising biosimilar participations. As shown in the chart, our global market share has been maintained, and at the same time, buyer-similar participation has steadily increased, climbing from 55% to around 65% in 18 months, a clear indication of growing acceptance and adoption. In Europe, Hiram Oz remains a strong foothold, while international sales growth has been exceptional this year. In the U.S., we lead the market through a dual strategy, namely private label and own brand. Together, they offer the broadest pair coverage, enabling us to capture originated share and reinforce our leadership position. This performance reflects the strength of our portfolio, the effectiveness of our commercial strategy, and our commitment to improving access to high-quality biosimilars worldwide. Now please turn to slide 12. Let me now move to Tyruco, our biosimilar nataluzumab, which continues to deliver encouraging progress in Europe. We are proud to be the first and only biosimilar approved in Europe for relapsing remitting multiple sclerosis, a major step forward in expanding treatment options for patients. Looking ahead, we have additional launches planned in the US and across various European and international markets, reinforcing our commitment to leadership in neuroimmunology and biosimilars. Please turn to slide 13. Omnitrope continues to deliver strong performance as the market leading by similar for growth hormone related disorders with a global market share reaching 37%. This steady upward trajectory from 24% in 2022 reflects our ability to consistently grow share in a competitive landscape supported by good sales growth and rapidly expanding markets. The international region has been a key driver of our performance this year, even as we navigate increasing levels of competitor activity in the region. Our commercial execution, trusted brand and global reach position Omnitrope to continue being a leader in this space. Please turn to slide 14. Let's now look at the recent U.S. launch of Wyost and Javante. which marked a major milestone in our buy-a-similar strategy, with both medicines achieving first-to-market status and demonstrating strong early momentum. We rapidly established a commercial footprint, covering over 80% of Denosabag volumes, ensuring broad access across key provider networks. We led with an interchangeable product exclusively, and, in addition, Q-code exclusivity drove an important early advantage in market positioning. We're seeing early wins with major players, and recognition by the NCCN as a substitute for Respirant's Denosumab further validated our clinical and commercial approach. This launch not only reinforces our leadership in biosimilars, but also sets the stage for continued growth and patient impact in osteoporosis and the oncology space. Now, please turn to slide 15. Sandos continues to advance one of the industry's most comprehensive biosimilar pipeline, with 27 assets spanning all stages of development. We have five near-term launches and assets in clinical development, five assets in regulatory review, and have nine additional assets in early development, targeting $50 billion of originator sales. Now let's turn to slide 16. Finally, as we continue to lead in via similars, regulatory streamline is emerging as a powerful enabler of growth and innovation, with 27 assets currently in development. Our pipeline targets approximately $200 billion in originator sales, covering 64% of expected loss of exclusivity events over the next decade. Recent regulatory shifts are helping reduce complexity and cost across clinical development, ultimately accelerating access for patients and easing pressure on healthcare systems. These changes not only strengthen our pipeline, but also open up additional opportunities to expand our leadership position in biosimilars. By embracing regulatory innovation, we are well positioned to deliver more medicines more effectively to more patients worldwide. And with that, I'll hand over to Remco. Please turn to slide 17.