Teqnion AB (publ)

Ladies and gentlemen, welcome to the SOBE Q3 Report 2025 Conference Call and Live Webcast. My name is Sandra and I will be the operator for your call today. I would like to remind you that all participants have been listened only mode and the conference has been recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and one on your telephone. For operator assistance, please press star and zero. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Guido Oelker, CEO. Please go ahead, sir.

Yeah, thank you, and hello, everyone. I'm really delighted. We are all delighted to welcome you to the third quarter 2025 conference for investors and analysts. As usual, we posted the presentation beforehand. As far as the next slide is concerned, the disclaimer, we would like to remind you of the usual provisions on statement about expectations, projections of future events. And unless stated otherwise, we will be making comments that must relate to the third quarter at constant currency rate in Swedish krona. Today, we plan to cover the following key aspects of our Q3 report. I'm joined by Henrik Stenquist, our CFO, and Lydia Abarth-Franch, head of R&D and chief medical officer. We plan to review the presentations first and then open up for Q&A at around or until around 2 p.m. For those on the phone, please join the queue for questions by pressing star 1. we propose you ask one or two correction max at a time. So with this said, let's go straight to the presentation. As we want to cover quite a few topics today on the quarter, I would like to provide you with an overview before diving into the specifics. So first, We delivered an outstanding Q3 performance with 21% growth at constant currency. This was driven by a remarkable 39% growth of our strategic growth portfolio and a clear validation of our innovation-led strategy and commercial execution. Adjusted EBITDA with 47% on sales shows strong, obviously, business momentum, but also cost discipline. We took an impairment on one job, reflecting the deferred uptake. We'll explain later on how we drive growth moving forward. Material progress in our pipeline, let's say foremost, the scheduled PDUFA date of NASP in June 26, and the approval of Olezarsen in FCS, as well as the readout of two Phase III studies in severe levels of triglycerides. The momentum in so many different areas of our business have prompted us to increase guidance in terms of top and bottom line. Please turn to slide number five. Let's have a closer look at our Q3 performance. We delivered net sales of over 7.7 billion SEC in the third quarter, representing a 21% increase at constant currency rate compared to last year. This growth is driven by continued success of our strategic growth products, as earlier mentioned, which account now for 64% of total sales. Whilst nearly all products performed well, the fantastic performance of Dr. Landgame Fund and Alta Group should be noted. Regions have performed well, growth rate of 37% in the US, 21% in Europe, and 43% in international demonstrate that the engine of our company is very productive. Let us go through the specifics by product. Turning to Doctelet, our largest product and key contributor to our growth story. In Q3, Doctelet delivered 46% growth at constant currency, continuing its strong trajectory. as can be seen in the chart on the left, reflecting consistent demand and market expansion. This growth is underpinned by Dr. Lett's differentiated profile in ITP. Excellent efficacy and fewer dietary restrictions make it a compelling option for both physicians and patients. Dr. Lett has performed well in the U.S., but the growth has been carried by all regions, including international markets. Japan launched one month ago and already showing very promising signals. Please turn to slide number seven. In Q3, Bifortis delivered just over 1.16 billion sec in the early part of the season. RSV immunization rate for the 24-25 season stood at 57%, indicating significant headroom for further growth. In view of the debate regarding the use of prevention medicine, we commissioned an independent survey with over 100 physicians. The summary of the findings are as follows. Bifortus has been recognized as a competitive product with a high preference share of over 90% amongst HEPs. HEPs did not see restrictions or limitations in terms of access for patients and physicians. And thirdly, from the survey, we also saw that physicians expect no decline in RSV cases for the season, although the season does seem to be starting later, according to the latest CDC data. In summary, Bifortis appears to be well positioned as the season begins, supported by strong clinical fundamentals and high prescriber confidence. Our take is that there is a typical uncertainty around the start of the RSV season and stocking levels. This was something we also saw with Synergis. Sanofi, as a product owner, may provide additional color to the status during their report. Let's turn to page number eight. Altawork delivered 769 million SEC in sales, resulting in hemophilia A sales of 1.6 billion in the quarter, representing 31% year-on-year growth. On an annualized basis, we may exceed 6 billion of hemophilia A sales this year. The market dynamics, as we talked about throughout the year, are continuing with continuous switches from Elocta to other competitors, including non-factor products. which reinforce Altovox's competitive edge. Our launch strategy is progressing in three ways. We wanted to give some orientation that our current growth is primarily coming from early launch countries and obviously more to expect during this year and the years to come. We expect to launch in Italy and France during this year. And when you look to the left of the slide, You can see, let's say, an increase in Q1 on Elocta. This was primarily driven by tenders at the time, and this will normalize throughout the year. So, in summary, a very encouraging story with Altovox and the overall Hemophilia A franchise. Let's turn to slide number nine, Gummy Funds. which continues to deliver exceptional growth and strategic progress. In Q3, Gummy Fund generated $733 million in sales, sex sales, up 98% year-over-year. A key milestone this quarter was the U.S. launch of Gummy Fund for Macrophage Activation Syndrome in Stills Disease. This marks the first-ever approved treatment in both adult and pediatric patients with masks and it gives us confidence to grow in HALH overall. Looking ahead, we are advancing our Gummy Fund IDS program, targeting immune dysregulation in sepsis. The EMBRACE Phase II AE trial is actively recruiting with a primary endpoint expected by the end of 2025. We will provide a market update in our Q4 earnings. While still early, this product has obviously very material space and potential in this indication. In the U.S. alone, there are approximately around 2 million sepsis patients hospitalized annually, while nearly 1 million require ICU care. IDS represents around 20% of these patients, and these patients have a mortality of 40%, highlighting the significant unmet medical need and the potential impact that Gamifan could make in this space. Looking forward to updating you latest by the Q4 reporting. Please turn to slide number 10, one joke. OneJoy has demonstrated solid demand growth of 9% for the quarter versus previous year, but was down 11% due to growth of gross to net adjustments primarily related to 340B and Medicare redesign. The disadvantage with regard to a narrower labor versus competition, despite the overall strong body of evidence, has not allowed us to achieve our own ambitions yet. As a result, we have recorded an impairment charge of 6.6 billion SEC. Consequently, we focus on broadening our label NMF and internationalizing the product. Pacifica has been accelerated and will become the key cornerstone in this regard. Bidia will give you an overview later in this regard. In addition, the development of the VEXAS indication is making significant progress. The chart should illustrate and outline that we still expect Wonjo to become an important growth driver for Sowie, but later. Please turn to slide number 11. We have seen the positive margin in evolution in our press release, and Henrik will cover it in the financials in more detail. This was driven by relative OPEX reduction from 38% to 33% over sales, driving margin improvement to 47%. I just want to make a point that the efficiency program reported in Q2 helped us with the earnings this quarter, but more importantly, will give us headroom to support an important portfolio of launches and development projects in the years to come. Hence, this initiative was an important strategic move for the company's evolution. Please turn to slide number 12. We have shared quite a few insights on our portfolio at previous events. Just to emphasize, five key and planned launches and four priority clinical projects evidence a strong ambition and commitment for the group. Before closing my section, I want to shed light on the opportunity with regard to Trigulza or Olisarcin. Please turn to slide number 13. Just to give a quick perspective on the disease area, we have got an approval for Trigulza in Europe in FCS. an area that we are very familiar with, via the preceding product called VeLivra. In September, the data from the Core 1 and Core 2 study, both Phase 3 studies were announced, which included over 1,000 patients with SHTG, including MCS patients, and showed that 72% placebo-adjusted reduction in fasting triglycerides. Equally important, we observed an 85% reduction in acute pancreatitis events compared to placebo. These data suggest a major breakthrough for patients with MCS and severe hypertriglyceridemia, while occurrence of acute pancreatitis is a major medical issue. The full data will be presented at the podium on November 8th at the American Heart Association Conference. These results position Tringosa as a potential game changer in MCS treatment. Please turn to slide number 14. Let's now look at the commercial opportunity for Tringosa, which we believe is highly significant in the treatment of MCS. meaning with more than 880 milligram per deciliter triglycerides. We have performed two deep dives on the disease over the last couple of weeks. In Europe, the cutoff point for the treatment of this patient will be at higher triglycerides level, as mentioned before, for multiple hylomicronemia syndrome, or MCS, with a cutoff of 880 milligram per deciliter. In this indication, the number of patients in Europe 5, the leading five countries, are around 700,000 patients. The product will become very important for those poorly controlled with a high risk of acute pancreatitis, so meaning for a subgroup of those patients, round about one-third. Considering all these factors, the product will have a peak sales potential of over 5 billion SEG in EU5 alone. Please keep in mind that our territory extends to all Europe and most of the international markets, so a total patient population of 4 million, which obviously need to be then adjusted for the ability to purchase or the ability to get reimbursement. We will submit in EMA in 2026 for the MCS indication. But in totality, you can get, I think, a sense that this is a major opportunity for SOAP. I want to close my presentation by emphasizing that we had a very strong business performance in Q3, as you can see on the left. 21% growth, 47% adjusted EBITDA. We had significant pipeline progress. Given our momentum, we increased also our guidance for sales and EBITDA. On this note, I would like to hand over to Hendrik, who will lead you through the financials. Thank you.

Thank you, Guido, and hello, everyone. Please turn to slide 17. We will now take a look at some key financial metrics for the quarter. In Q3, our revenues of $7.8 billion correspond to a revenue growth of 21% at cost of currencies and 30% excluding seasonal base mortgages royalties. We saw double-digit growth across all three segments and in each region. From the product perspective, growth was created by out-of-box tops that I scanned. Thank you for that. If we look at the table on the right, and the adjusted gross margin of 80% in the quarter compared to 81% last year. We saw an improvement in margin from positive mix effect and the new Estabelli royalty agreement, but this was offset by lower May 40s royalties. Operating expenses for the quarter were flat to last year at CER, SG&A, excluding non-recurring items, and amortization increased by 3% at CER, driven by launch and pre-launch costs for Altebox, Asta Valley, Nephrology, and NASP. And this was partially offset by lower costs across Bongeo, Dobsonet, Synergis, and Deloxa, including the cost savings initiative we outlined earlier this year. R&D expenses declined by 6% at CER, excluding non-recurring items, mainly due to NASP programs that are now complete, as well as the cost savings initiative and Bonjoe and Gunnifeld. And as a result, the adjusted EBITDA for the quarter amounted to 3.7 billion, equal to a margin of 47%, compared to 43% for the same period last year. The Q3 net earnings number is a reported loss of 2.9 billion, and this is due to the impairment chart for Bonjoe of 6.6 billion. We remain confident that Bonjoe will be a long-term growth driver, but also acknowledge that all expectations from our original case have not materialized. The future growth opportunity comes from potential border label and international expansion. We also continue the development of Mongeau in potential new indications in CNNL and Vexus. And excluding the impairment and other one-off items, the adjusted EPS grew by 40% in Q3. Operating cash flow for the quarter was 1.8 billion compared to 1.2 billion last year driven by improved operations. And that gave a net bet at the end of the quarter of 12.2 billion, maintaining the net bet to ETA ratio from Q2 of 1.1 times. Please now turn to slide 18, and we will discuss the financial outlook for the full year 2025. And as usual, this outlook is based on revenue growth at constant exchange rates and adjusted EBITDA margin. Over the whole year 25, we have upgraded the revenue guidance from high single-digit percentage to low double-digit percentage growth at CR. We've also upgraded our adjusted EBITDA margin guidance from in the mid-30s percentage of revenue to to mid to high 30s percentage of revenue. Through the first three quarters, we saw strong momentum across our portfolio with 15% growth at CER. We expect continued growth into Q4 across our commercial portfolio, primarily in Outerbox, Dopplet, and Gamifund. And this guidance also reflects adjusted expectations for Bonjo, reflecting the year-to-date performance. Our year-to-date adjusted EBITDA margin of 40% gives us confidence that we will be able to deliver a full year margin in the mid to high 30s. We will benefit in Q4 from expected continued revenue growth, but in addition, we see lower operating expenses than previously planned, mainly due to the realignment of SG&A and medical activities for NASP following the June 2026 PDUFA dates. as well as an accelerated impact from the restructuring activities that we announced in Q2, and this together with a disciplined cost control. Despite this OPEX development, OPEX are expected to increase in Q4, quarter over quarter. In SG&A, costs will ramp up in Q4 for our two key launches, NASP in uncontrolled gout in the US, and in Europe for Aspen Valley in nephrology. In R&D, we will continue to invest in our priority development projects at a slightly higher pace than in Q3. In addition, we'll be preparing for regulatory submission of Tringolsa, Olesarsen, and MCS. And with this, I now hand over to Lydia. Thank you.