Merck & Co. (MRK) 1 Aug 232023 Q2 Earnings call transcript

Thank you for standing by. Welcome to the Merck & Co. Q2 Sales and Earnings Conference Call. At this time, all participants are in a listen-only mode, until the question-and-answer session of today’s conference. [Operator Instructions] This call is being recorded. recorded. being is call This

If you time. disconnect this you any objections, may at have

I call may turn Peter to would like now the President, Relations. Dannenbaum, Investor over Sir, you begin. Vice Mr. to

good morning, call. conference Thank you, Cedric, everyone. to quarter Merck's Welcome XXXX second and

Litchfield, call President Caroline of Labs. Financial Speaking Merck Executive on Chairman Chief Dr. be Research will today's Officer; Davis, and Rob and Officer; Chief Li, Dean

point out Before a items. we like get started, to I'd few

such items You charges, as will results we our other acquisition-related have costs in see certain and restructuring GAAP that items.

have You that press these note results should non-GAAP and a we our excluded in from reconciliation our provide release.

beliefs would may safe on of the results I the set underlying today be to of considered the uncertainties. risks Litigation some based United States forward-looking and the harbor made provision Private the forward-looking you forth or are materialize, Act Merck's inaccurate statements current to subject are the Such from statements. management like those Securities significant of statements differ materially prove uncertainties XXXX. our and that If in of of make statements that assumptions Reform we within may remind actual meaning

certain any and publicly results cause including made to morning. risk filings, XX-K, of forward-looking from any that our obligation differ Our SEC Merck statements. no update factors statements those this statements the materially the XXXX cautionary Item to XA and undertakes actual identify could forward-looking company's projected in

Investor Merck's are all with call, our filings remarks earnings to prepared our prepared the release, and today's speakers' remarks. These During slide the Relations slides, website. along presentation a accompany of will SEC section posted today's

call to turn over Rob. With to that, I'd the like

call. you morning, for Thanks, joining thank Peter. and today’s Good

teams, medical growth our operationally great pipeline progress global Thanks drivers. science bringing discipline needs. advancing most support We to unmet urgent to of our key help in continue of and compelling unwavering our the executing address we’re and innovative the world’s commitment to forward make in

Our lives is that animals save and our science-led the world innovations and strong strategy delivering growth improve and for patients the of underlying is generating around business.

record priorities. our We’re track building strong advancing on our and strategic

sotatercept where We’re have add further development can leveraging FDA for applying value which progressing and patients. with submission, pipeline, to clinical to strategic by deep augmenting global and our we business it our broad accelerate expertise our completed including scale access we our

our An acquisition which of of completed Biosciences, is we excellent this in Prometheus example June.

toward The actively with medical immunology, in clinical an integrating Prometheus speed presence the talented have need unmet initiation immuno-oncology. significant team our builds X moving strengthens now We’re substantial in area a addition gained and and trial. insight the Phase are with of of significantly we scientific on

immune-mediated opportunity us debilitating potential commercial population excellence, TLXA we’re a care suffering also well-positioned inhibitor, transform to from a a the and us legacy foundation of of provides with to sustainable It great science the best-in-class long-term. which patient value brings over novel first-in-class, in the a standard diseases deliver of

Vaccines. in We moment. by the We Focusing which of delivered across a key and in robust for in drivers sales, outlook will underlying the growth excluding demand LAGEVRIO address in remainder remain decline short-term. the year-over-year now on led Oncology Caroline growth, confident our strong XXXX,

in across at promising and pipeline data demonstrate KEYTRUDA ASCO, for cancer. diseases. continues our benefits from lung oncology, impactful range late-stage highlighted our research earlier to our to including we patients of pipeline stage for Moving organization, tangible broad In a expansive

is setting, shift for aspiration where neoadjuvant to patients adjuvant outcomes fundamentally the cancer better for The earlier strong the support higher. our non-small is of results with in of managed potential by cell the treatment cancer way KEYNOTE-XXX lung developing and regimens the treatment stage

wide-reaching to and new identify types a bring candidates. cancer Additionally, forward benefit promising across we’re of leveraging KEYTRUDA’s range

ADC individualized neoantigen data collaboration was our investigational for data positive adjuvant with of At And in shared lung the Moderna, to patients. future ASCO, improve MK-XXXX, by of we therapy and cell for cancer partner VXXX, candidates presented Biotech the TROP-X Kelun cancer. of treatment in promising in for our meaningfully in offer non-small also our KEYTRUDA with care outcomes glimpse a potential Each melanoma. these into the combination novel

made have outside also We progress oncology. of

dual adults. receptor population will to first cardiometabolic VXXX. our disease positive to advancing If our including We’re be our speak the VXXX very designed recently progress pneumococcal data specific for results vaccination vaccine pneumococcal have our are GLP-X/glucagon vaccine and specifically to candidate presented approved, for topline would announced And approach agonist. for Dean pleased positive we in conjugate adult

on I Merck and pipeline who is the and Merck’s our what done broad purpose. strives commitment it’s to their work the to every is being significant of and core team company his commend achieve day. to Dean advance our Innovation

We’re patients. value for the science in advancing of of pursuit deliver grounded the raising bar innovation relentless and to

communicated that without mind, law the access, biopharmaceutical With which for in Act. affordability the Part our very the that but consistently for moment of damaging I‘d about speak improve the Reduction long-term industry. elements like We’ve a of the so such do potential and as promising support Inflation reform, Medicare to D patient innovation

between improving policy several This does misguided the complaint to price in right recently strike provisions the in that and IRA believe stand investment price the we filed negotiation taking we affordability unconstitutional balance principled U.S. of the the against the violates long-term access. innovation District is negative U.S. incenting Through impacts which provision Merck amounts Court, Constitution. a of not setting of and

broad benefit drug medical possible, our needs. with remain in protecting vaccines, we to breakthroughs to future and order number improve both it to provide serve U.S. a to to That of that said, access of while to critical and medicines current know is committed unmet our come. We the innovations, and greatest facing access approach now that years better government working patients portfolio find further for we the and affordability to patients

driven employee access including a health, by four linked of Our areas, upcoming metrics progress. accomplishments where to our be highlight will to priority portion annual Impact now will Report our across compensation

our summary, strategy working. is science-led In

We’re dedicated work team talented, and to driving stakeholders. we of growth. expect and scientific, all their our global value commitment operational hard strong momentum commercial I full-year for delivering to thank will diverse significant and our and which enable shareholders patients, want for

these well sustainable With into the to I’m drive continue confident success future. efforts, we will

I’ll turn over call that, With Caroline. to the

Thank you, Rob. Good morning.

the for strong As and business, underlying in Rob medicines noted, underlying delivered demand we we another strong the globally growth These our by quarter, of health and growth. profound portfolio. driven of impact reflect very continued and the outlook have innovative with the our across in reinforce our confidence vaccines results

revenues to billion. were second turning our Now, Total quarter results. company $XX

exchange, XX%. The very strong delivered and revenue on of of comments my basis. LAGEVRIO be growth from impact ex-exchange the the foreign an business remainder Excluding will

Our Human sustained its Health momentum. strong business

by driven Sales business X% Vaccines. Animal Excluding across Oncology LAGEVRIO, and increased in both companion animal growth Health XX%, our products. and was livestock

$X.X our from KEYTRUDA certain carcinoma all to quarter earlier-stage cancers XX% key earlier U.S., brands. and benefit of from strong KEYTRUDA in metastatic continues global cancer, renal to across and increased and negative well of grew the tumor including Now, as turning utilization melanoma. second Oncology, to In cell driven approvals in from indications. as demand key the grew breast types types billion In by triple usage performance in stage cancers continued

cancer. on providers from lung negative types leadership driven cancer KEYTRUDA is markets. non-small initial high-risk, positive patients launched the cell uptake earlier earlier-stage demand saw lung in the and non-small reflecting its by was including is Growth significant Outside and stage impact KEYNOTE-XXX, of and certain as cancers, cancer. with renal well the uptake breast maintaining recently metastatic healthcare feedback in encouraged carcinoma U.S., are having in cell We KEYTRUDA triple neck early-stage by in and cell of cancer, which renal carcinoma, head as cell continued

advanced by demand alliance inhibitor. in revenue to China. market certain by endometrial XX% cancer in grew the X% cell and the renal partially treatment carcinoma driven increased of the demand lower Alliance increased grew sales Lenvima international Lynparza revenue patients U.S., remains certain for in offset due leading PARP markets. with

girls Our from Performance launch, global the X by in grew XX% U.S. years X China, also billion. age. sales increased VAXNEUVANCE GARDASIL, GARDASIL uptake was to expanded of of in women of where $X.X particularly especially led we indication benefited by to following the from which pediatric ongoing exceptional and for vaccines XX Vaccine portfolio the benefitting are driven delivered strong demand, growth,

ruminant by vaccines. for for growth our poultry products, due reduced partially Companion products, line swine grew higher by Acute sales in driven U.S. the business in Animal increased agents to actions, portfolio, offset for reversal price blockade for by Care including as part in grew supply reflects herd XX%, animal In Sales sales Health partially BRIDION of as products challenges price neuromuscular the demand growth market Hospital demand well Livestock share our reflects lower among BRAVECTO sizes. certain and X%. actions offset

comments the will a I percentage margin the one-time product of to a to billion and a remainder basis. of benefit related non-GAAP points walk mix, X.X Operating billion, $XX.X sales will favorable acquisition $XX.X our on LAGEVRIO. of including you lower now P&L, XX.X%, expenses including be was of Gross the due through from an increased increase my Prometheus. charge to

for expenses charge, portfolio investments grew increased near-term early late-phase our advance this our Excluding investments for future This disciplined operating and in-line exciting the XX%. we growth as and support of in opportunities pipeline. reflects

income million. was $XX Other

Our million. tax was $XXX approximately provision

not loss this tax charge, a charge result Prometheus pre-tax the a one-time As one-time of we had is This deductible. quarter.

is rate tax Our a XX.X%. negative therefore

a reported impact $X.XX of the which the loss related negative transaction. of Prometheus per we share, to one-time a per Taken $X.XX charge together, from share includes

by and expect approximately The percentage of and between negative at revenue continue of using our sales exchange to range strength to an $XX.X us billion, to now increase approximate million billion underlying mid-July lower rates. XX%, estimate point raise an which impact and We $XXX XX% full to $X midpoint. to our Turning from guidance. business XXXX we revenue This the X the revenue to non-GAAP year-over-year our year of strong be now foreign underlying has $XX.X be offset reflects expected of guidance. enabled this LAGEVRIO, growth year, narrow

is and XX%. between $XX.X acquisition and associated Our billion collaboration expenses to Prometheus, and estimate with includes unchanged be of $XX.X This billion. research Imago development billion We approximately and now at upfront range operating expenses gross assumption Kelun. margin $XX

does Our guidance development transactions. assume significant business not additional potential

expense financing Prometheus. incremental other related million, $XXX We which approximately includes now of costs assume to

due XX to reflecting increase of Prometheus between full tax to points. the transaction and is approximately Our year percentage XX.X%, rate be expected an XX.X%

billion We outstanding. continue to approximately X.XX shares assume

includes for Prometheus Taken points using impact from percentage $X.XX mid-July to we charge of of versus X approximately expect exchange one-time negative foreign a $X.XX, together, EPS rates. which and the XXXX,

a to excluded assets have midpoint financing and of Recall was costs, an Prometheus. we with which Had prior at estimated would range charge range included advance prior one-time $X.XX our the we noted the $X.XX $X, $X.XX. and guidance $X.XX the to our time to $X.XX been $X.XX guidance

midpoint Our approximately of resulting approximately an guidance current exchange in by partially the increase incremental our headwind business of from an strength $X.XX, from of $X represents offset foreign $X.XX.

driven our our the enabling deliver promising growth continued of guidance robust by strength confidence reflects Our our us while in key to investing our in business underlying pillars, pipeline.

to models, items stage uptake indications. has quarters, robust KEYTRUDA of expectations, exceptional your recently of are there part our in keep couple consider in outperforming you earlier by mind. recent As a in growth driven been launched

continue continued launch We growth impact as pricing at and KEYTRUDA, levels result European key we of of strong as quite of the expect to quarters, indications recent particularly lapping experienced markets. but year-over-year launches a in headwinds, in new not the

to second small was quarter, the purchase a in there benefit wholesaler the reverse timing from third addition, expect quarter. in the in which we In U.S.

strong rate timing out pace including of due second GARDASIL growth to impact higher than as look anticipated XXXX XXXX, we And to first of we reminder, the approvals. half, to of to shipments China. growth is of expect while beyond, growth and part be the As be the of to half we below expect in continue XXXX additional the to the a in

Now turning allocation. capital to

positioned it value with will investments our business to to goal and through to remains growth increasing growing most Business pipeline pursue in long-term our to our near our prioritize continue portfolio. enhancing a time. priority. over external science of well We the to compelling remain the across dividend, and We augment development We drive business committed pipeline. remain development

to to continue year. a modest We execute level share expect of repurchases this

to the global and for vaccines, continue driven underlying enter year, the we and very the remain medicines excellent in by our innovative all will business, as into value execution of both, the of to shareholders dedicated now conclude, teams across areas we half confident which our the and strength demand us deliver of well business, future. To our customers and our enable second of to patients,

to over Dean. turn With like I’d the that, to now call

Thank onto multiple Good first everyone. infectious start will by areas to since of Caroline. I across quarter call. finally oncology, and pipeline. with you, followed broader the morning, pipeline therapeutic our It’s an provide Today, the overview significant and pleasure my diseases vaccines progress

of for an estrogen in Last area positive, Starting earlier of cancer, week greater to with receptor-positive, combination options met trial oncology. X demonstrate result the for cancer immunotherapy-based the endpoints patient high-risk, to this Phase to complete is X be the population. dual following stage the The disease, regimen where for study meaningful there neoadjuvant in HR This prospect positive an breast negative of its one with first early-stage with HERX pathological continues of neoadjuvant/adjuvant part patients development patients breast improve with primary of KEYTRUDA study. response early-stage announced, is we treatment in evaluating significant Phase progress. chemotherapy, outcomes, KEYNOTE-XXX a

cancer improvement on primary treatment in X met patients one progression-free our newly and cancer. progress cervical trial announced of show that Further, for of clinically Phase diagnosed significant progression-free high-risk in of of study chemo-radiotherapy its locally earlier-stages building the we meaningful survival. and KEYNOTE-AXX women’s in survival disease, endpoints statistically of This with radiotherapy the to advanced or KEYTRUDA plus is first

an ASCO, presentations. data overview part our At provided relevant investor of as and pipeline our development we clinical event, highlighted of

stage the by patients have the IIIA doublet IIIB cancer. therapy, disease. in ongoing Detailed stages Difficulty] platinum respectable in KEYTRUDA evaluate with presented non-small as We [Technical with study, of evaluating and momentum results chemotherapy cell for II, as KEYTRUDA opportunity KEYNOTE-XXX strong lung followed we neoadjuvant adjuvant were from earlier

action Subgroup XX. by Treatment with The October followed disease surgery, showed a consistent of after and alone. KEYTRUDA chemotherapy is disease. analysis death the risk progression, or regardless and monotherapy surgery, XX% by target KEYTRUDA before preoperative stage PD-LX of reduced response expression, recurrence, PDUFA versus of histology, date chemotherapy

with earlier-stage KEYTRUDA of Phase neoantigen and after optionality With chemotherapy, the Xb more investigational presented were from also an with after therapy the in KEYTRUDA non-small VXXX, patients approval collaboration before benefit to surgery the data with as will our cell lung potential treatment treatment with and Further cancer. adjuvant for KEYNOTE-XXX surgery, as for in of combination approval individualized KEYNOTE-XXX, along Moderna. study KEYNOTE-XXX provide

compared The study reduction a KEYTRUDA with risk stage alone. to or death resected XX% in IV showed metastasis distant in patients of / melanoma III

for upon types, build Phase to registrational and non-small have IIB We high lung melanoma, started plans patients adjuvant risk, enrolling to the of the treatment are to eager with including IV stage to findings these cancer. into program X trial expand tumor additional cell

our from MK-XXXX, level. or for anti-TROP-X locally regardless antibody refractory cancer, presented cell lung activity conjugate, metastatic showed non-small data of drug in patients or with relapsed Finally, Biotech investigational Kelun licensed anti-tumor advanced expression TROP-X encouraging

Phase the lung additional broad X candidate in program advancing types. are clinical We scheduled this trials development with cancer global for and tumor

an the in prostate approved area cancer, important On for the by castration-resistant patients combination with FDA unmet was need. BRCA-mutated and regulatory treatment Lynparza front. prednisone, the of adult abiraterone metastatic with of

with supplemental for locally In or KEYNOTE-XXX PDUFA for February advanced based KEYTRUDA cancer, metastatic action with Application for combination the from biliary review. patients by accepted FDA our Biologics X, on is target in chemotherapy date License findings tract The was XXXX. unresectable addition,

junction the or adenocarcinoma Merck has tumors announced new a KEYNOTE-XXX, findings for with significant data trastuzumab demonstrated in whose FDA improvement KEYTRUDA. also the is were gastric in survival which for to indication HERX-positive progression-free gastroesophageal combination working We PD-LX update of in advanced current and treatment these the showed chemotherapy first-line positive. and patients KEYTRUDA from discussed with

for on the Agency’s study, from European received based the Committee Use. we from for the Products Medicinal opinion KEYNOTE-XXX Human Medicines In data positive addition, a

vaccines Turning diseases. infectious and to

to now vaccine specific to and at-risk pipeline and and pneumococcal for healthy approach conjugate candidates evidence-based and populations, establishing the our XX-valent with of pneumococcal address a thoughtful VXXX, subgroups, with of starting We have needs including taken adults. infants different a children, continuing investigational vaccine adults VAXNEUVANCE

are for more invasive includes approved potential pre-pandemic to protect invasive CDC pneumococcal data. against eight on currently disease than has the individuals older in in help of of vaccines, and data. VXXX based individuals on approximately based XX by XX XXXX pneumococcal XX% which and not serotypes responsible disease to disease pneumococcal coverage XX% covered older, VXXX same expand

the results we STRIDE-XXX serotypes for demonstrated statistically common significant two trial announced PCVXX and from VXXX. X to one in to least responses pneumococcal vaccine STRIDE-XXX topline trials The week, for positive immunogenic Phase vaccine serotypes VXXX compared Last who vaccine-naive received vaccines, evaluating previously prior among year in to study. the both trial was XX demonstrated immune adults a adults that all pneumococcal at the

medical detailed share at to plan upcoming conference. eager are these data findings and present to an We

be As represent specifically would designed Rob address adult conjugate the pneumococcal VXXX to noted, vaccine the that if serotypes first pneumococcal approved, disease.

recipients for who we for FDA important has for pleased received CMV Since adult kidney it prophylaxis recipients infection. are of the benefits and for option Diseases, CMV transplant Infectious In preventive transplant of provides PREVYMIS to disease in on infection of approval. of at high-risk new adult an with are disease build allogeneic PREVYMIS cell we approval hematopoietic and stem an seropositive cytomegalovirus XXXX, been this

in the space. continues Progress cardiometabolic

As the from for Rob submission sotatercept, the completed arterial with mentioned, for license pulmonary the following remarkable the trial, STELLAR the have hypertension. to FDA application we adults of treatment of biologics the results

working Sotatercept with designation has granted the by its review. FDA, Therapy Breakthrough we and forward been Agency the look to on

MK-XXXX, this We PCSKX Phase month. oral are in X is later broad to our inhibitor, advancing anticipated Enrollment trials our cardiovascular for start program.

disease. results the was Xa Study efinopegdutide of Track study, dual open-label at findings on Based of the the in our by GLP-X/glucagon were Liver investigational granted In Phase randomized, from positive liver Designation with for active-comparator-controlled, Fast efinopegdutide, agonist, receptor study the non-alcoholic the meeting, June, European FDA. this from Association fatty patients the presented

in pre-cirrhotic Xb with patients efficacy and study started evaluate safety We a NASH. Phase to adult have now

the has the New in The CHMP target Lastly, the XXXX. resubmission European antagonist, of receptor PDUFA our action Application Drug chronic positive This our in unexplained cough opinion for treatment December the FDA of accepted from Union. gefapixant, adults. the or XX, is for refractory follows, PXXX the date

development mentioned, combined quarter the diseases. finally, we expertise team welcome delighted better on MK-XXXX, to from as with formerly this leveraging past Rob to is And and for The Prometheus are our were clinical and colleagues focused advancing Merck. strengths immune-mediated to new PRA-XXX, our patients serve program

of portfolio late-phase a patient by to proceeding a In focused cadence guided and diverse candidates, of closing, we promising science are and and have established pipeline progress with advance rigor regular needs. speed on

we on build positioned forward, data Moving milestones, readouts are therapeutic to well and clinical catalysts regulatory areas. momentum this further with across

And back to call now I turn Peter. the

questions. to Thank take you, as one as get today. to would so Dean. you. possible limiting appreciate we're we Cedric, – analysts Thank themselves can limit to We ready question, many

Instructions] comes from you. question with Bank Meacham Our America. Thank [Operator Geoff first of

line Your is open.

higher the guys. the more get with month? the But this call you. on I Rob, on it the for Thanks beyond being companies fray IRA with much the talk initial fall to a named to you comments Merck? drugs to Hey, so there join I XX the hard to at on suit, level, up wanted specifics to any milestones your a ask that. it's some for important is opened so how are next question. watch And suit you bit strategy. on know little Thank

of see concern, the obviously drove with the untenable industry. And and appreciate I our as challenge innovation all really that actually have a know to we about what IRA, bring reason to suits, Merck think reinforcing total, same drug as the pharma. are question, trade companies -- as suit. it's four But that's your suit to the question. to worth regards following now, well you the arguments principal Geoff. in us And an to we the in filed as group including the largely the is chamber just addition I types in Yeah, raised have there

suit. That's the particularly the first not and the good brought what all is the and the is policy. moving constitution we're negotiation to bring belief the in fifth provision a So to and us amendment IRA of forward that violation both provisions, of of our is

to look the need through fullest, be, and court, Supreme we court to going Court. the we're which As take it to this circuit we'll take ultimately forward, and if district in means the

in the other beyond to So I that strategy. now. whether to that's really, going comment see in companies and want additional you're the on come companies don't four are

going But really. likely be as not triggers think As to initial of out. for, while while any some is we a near resolved by do the this what highly set the see play What going we is large through time I as the play. That's into really to longer-term in the for think moving any that about is obviously far really we dates the you're time discovery of hearings, initial watch able to courts needed. term. various and thinking have to XXXX kind get don't is a This and to will we're take indicator frame. see I Because this the

Thanks, Geoff.

Cedric. Next question please,

Yes.

comes Bansal Wells next question with from Mohit Fargo. Our

Your line is open.

Okay. question. onetime much My Thanks taking is items. very the regarding for my question

regarding mentioned of U.S. Would is impacted KEYTRUDA quantify you you. GARDASIL, the little the Thank to able for as as to a be onetime bit? this you understand items. by magnitude trying Just Caroline, in much those how So well China

Mohit. question. Thank Yes, you the course, of for

world. onetime in driven by talking items We were no every the exceptional So GARDASIL, had GARDASIL. the geography growth for growth, quarter around about there was first, that

second the year growth As we slower China to think we've and shipments be half were than year of though, the than of expect therefore first the to the what do first less the the half. half we year half about of achieved in second expect to the in they be

launching. we’re a billion, $X.X very we we the quarter, the XX%. of KEYTRUDA, For including had cancer and indications, all sales indications a growth strong earlier-stage strength States, In of United was that had that across

buy-in of the saw of Now the slightly we buy-in because XXXX quarter million higher in second of than benefit XXXX. that quarter was growth included in the approximately wholesaler $XX second

$XXX come. the to quarter. have new been growth out That quantum buyout strong well brought expect has in said, has to indicated they in expect who third distributors to indications the million. of continue launches And be as from to given the indicated of the buy current we KEYTRUDA has we One that that as

Mohit. Thanks,

Next Cedric. question please,

Yes.

next from with Louise Our question comes Chen Cantor.

is line Your open.

Thank for you start questions. Thank designs trial wanted could more any trial, my ask you III outside other give taking then Prometheus IBD. your and And you clinical color you'll those. then to if the you. when Hi. you'll of Phase on just if I on pursue indications

so just I'll Prometheus. Thank a that. other Yeah, mechanisms. in for want the I for take much cycling question to Again, very level set, then you to the there's anti-cytokines lot relationship and of inflammatory of bowel disease,

of black actually Some box. them have a

very moving as or to And MKXXXX anticipate we're relationship well. So other data Crohn's integration Phase this going the Phase of to the the of with enthusiastic that in extremely appropriately. of for disease We be forward is year we'll colitis. and comes other diseases, TLXA. III In ulcerative terms III, starting start adjust

extremely colleagues and the with has integration we our Phase at So year gone start are Prometheus targeting of this III, the well. the

Louise. Thanks, Great.

Next Cedric. question please,

Yes.

Investments. Your next question comes with Guggenheim Seamus from Fernandez

Your line is open.

met our significant was this actually on hoping and if the question a actually My could serotypes, implying be for new what that is clarify metric on if (ph) XX statistically implies means non-inferiority perhaps overall on Dean, that it because superiority an significant STRIDE-X results just statistically the Thanks. pneumococcal margin. superiority it that us to Great. superiority is in that could you or the individual vaccine, prevent simply VXXX.

bit to get there. clarification little a Just more trying

better a data, of you a get opportunity today, as in just the of, follow-up wanted meaningful that, use where have immunity. believe to it Thanks. in herd setting the a adult if as immunization been opens markets international sense reluctant because national programs largely And up to to pneumococcal vaccine sits

you Thank so much. Yeah.

be going top with presented and to the the in path ACIP. the to data presented, this an pleased at the to the regulatory approval a for in to and that's is also soon it's going eventually VXXX. international add conference, relatively be U.S. but just I'll but It's path I say just confidence So me just not am data gives it line, forward

this of than So if disease covers And recount it -- the it first all pneumococcal pneumococcal just point is I and that older the you greater data approved, strong. or adults be XX% vaccine would as would first, adult-specific in than XX. out,

one XX data always I see there, about how out, non-inferior vaccine way is there The the situation, valent, PCVXX the it one shared that and ones with question that XX in that a is, that shared And the the shared the does in XX with And would there's as will there's met -- compare one boundaries. PCVXX. with be is that right, in one the think looks the uniques at PCVXX? it with has coming is shared

I so And VXXX. want to XX unique clear serotypes unique the are to be about Clearly, that.

whether this to you're about serotypes. superiority significant, I'm the will meaningful. so forward are or hard when the anything whether And And they're talk is about talking XX issue clinically we confident for that really like unique as move statistically It's that, that become clear.

to you've appropriate validates having touched because just want sort But little on I serotype bit. an back age the coverage. strategy It of step of a it

It serotype year impotence provides valent. importantly, Just immunogenicity for within improved of to remind protection has And it XXF first the everyone, VXXX has is and X. life. most XX XXF,

VXXX of view age disease give we to thought turn to is market. adult it. coverage. So about prospects see that's invasive clearly how that and And [indiscernible] over I'll appropriate driving XX the some commercially, we valent Rob it serotype pneumococcal towards then how then But is the

thanks, Yeah. No, you. thank Dean, Thanks, question. the for Seamus, and

good summarized, just Dean expect. as data as you the could about much pretty is As

opportunity confident we're today, to sit a the in this we can in is vaccine States, there us take for here both United this and as offer So internationally. what believe very meaningful we do

how plays out. So we're it to going to have see

today, here Prevnar than XX% as give soon to development. XX. product better sit out, as as better we than so get It's we do as That's pointed But coverage. this Dean vaccine XX% and think, excited any launch in ready we we because are also we to do other approval about currently

we So think VAXNEUVANCE, into when what combine you pneumococcal important we drug. franchise a it multibillion future. go our we have could opportunity as think with the out an is is that we this with And significant be

to we're this we're something and to going invested drive continue So is in aggressively.

Seamus. Thanks,

question Next Cedric. please,

Yes.

comes from Our next Group. question Akash with Jefferies Tewari

is line Your open.

line you is Jefferies, Sorry, open.

hear you me? Can

Yes.

Okay. Good.

presence So one the your guys over how category? up had inhibitor you have you. part business in your a strategically And fit time FcRn it maybe assets plans prior being there of team that does this to BD? Is in the limited any (ph) urgency via immunology. view those and to externally Thank pretty end with could on may Prometheus, large build any class, out how of

the of let for in immunology. actually have a Dean we this. a question. science presence But side thanks had I'll Akash, from perspective, speak the Yeah. business to

You that we States, might and United across outside Remicade. Europe sold the recall

So Symphony. involved we've -- and been

space. we've So been in involved this

As sit build. commercial lot a think We the a of have. we today, actually can capabilities leverage we don't we see we significant here

in will area We success. invest this for

from that some Dean can as space top the And this been brought we really then Pandion acquisition, building in side. the we the well talent science development comment did off we in as learning discovery Prometheus area in into the immuno-oncology have Obviously, both the on now building with immunology and and area.

gap. I we development. open always for drive But to further we're this we're to for more growth. augment continuing do we positioned it's business. think something So a think additional have of do And well to to not fill obviously, to business to look I how continue It's

with and scientifically. lead we've them, continue would Pandion each fields. that many interested say, follow-on of have I I mean, should one Prometheus, be especially relationship and partnerships those in been how focus external acquisitions Yeah. those chosen very that are we it also blessed or, I Pandion, I has that be a what will them but through of us. compounds clear we've with that done And also should note answer compound the there fact the to come both important. by of top is will Prometheus talent are in that with to just

we're build. So this confident in very

and in that fast The as the is become well. that other moving [Technical years clear external, in those reasonably is next pipeline there an will internal few clinical the to Difficulty] is separate more space

Akash. Thanks,

Next question please, Cedric.

Yes.

comes JPMorgan. from question next Schott Our Chris with

Your line open. is

Hi. Great. so Thanks much.

follow-up. and an earlier a to Just a clarification question

second some I in seeing just I that expecting second you the pressures in more half the something to just addition of first you're I continuation half. guess, price already EU the wanted is in clarify, Just mentioned to the a think year? or on incremental U.S. in KEYTRUDA and the growth half that pressures. wholesaler of moderating dynamic, you're

And my other development. question business just on was then

company at you. Just speed post-Prometheus XX it months. past to are we think looking has over And terms more at transactions? further the activity ahead broadly, the still about is priorities full guess been in the pause should to this I point? of just a guess. in -- really what active months I Thank pretty XX or XX

Thank Caroline. question, you for the Chris. This is

do In continued terms the that. remainder of KEYTRUDA pressure price of to in as the the we for we expect Two noted, year, expectations Europe. elements

likely growth new to revenue. we we see we as indications, impact more volume those is we drive and launch but first The new launch therefore price will continue as as see reductions patients we'll indications,

reimbursement European in with time the in changes [indiscernible]. austerity countries, of in some the impact also as specifically Germany or have do shortening measures some AMNOG our the We U.K. of of as well line in the review with measures the

So as we are continued growth drive will see the headwinds forward, confident we sustain, we for look that those KEYTRUDA. we in that pricing do but

And Chris, development business on the question. Yeah.

firepower while we're feel and the BD confident I have already I very we do the with As tell you, about making we've Caroline I confident done. the our noted can prepared internal continue team remarks, very know deals. with pipeline in to ample feels the to progress and And

you will a as upcoming vaccines VXXX assets see talked oncology as in can be recently we've launches. with what cardiometabolic, announcing Phase look be down important going or III area well We've If business, forward, data, basically we important every number line. across about We either of the -- to we're go the of announced sotatercept.

I very progress. about So the feel good

a said, development. we being business to do That continue priority to have

we a opportunities on alignment can are slowdown. So to themselves, have and where capacity value creation, bring and we an not you act scientific willing we should see we and be If assets necessarily the will those. that when see and with present expect important strategy where

development as looking And I So well firepower the the where to engine we decade. we and build add and drive to discovery very feel to next into to talking because about trying a labs good we’re actively we our to well. are, sustainable coming own continue of have we’re want deals about continue we’ll while out

Chris. Great. Thanks,

Next question please, Cedric.

Yes.

from Our next Partners. comes Graybosch question Dana Leerink with

open. Your is line

that the cancer, the cancer, have including melanoma a mentioning, I Hello. KEYTRUDA. stage I the I and for growth you of triple-negative in could it's outside you -- question both for talk about U.S. on thank believe you the some been see question – RCC, U.S. wonder and in breast you've remaining early-stage if how much X probably markets headroom lung KEYTRUDA

Yeah.

here. and is where high-level start ones indications, are that I'll continued for I can But in current lot something ones coming. importantly, have Caroline room cancers, both add and growth in of we if miss So we early-stage the see the still a answer

running growth of slow driven and the U.S. a seeing world. breast picking across the has because driver kind at That through in outside will both States launch this It the adjuvant, we're year. last the driver it year of the an in the year up neoadjuvant growth, setting. United in into obviously, So It's growth was the next but earlier cancer list, phase States. triple-negative U.S., of a in the metastatic we're important United in big

to important be area. So that will continue an

announced And then you data important saw in KEYNOTE-XXX. we today,

future So well. breast the that indication early-stage for coming potentially promising path see is cancer we a could down as that in

continue lung cancer, we to at look you expect growth. If

of going in therapy, growth we're earlier what's we're KEYNOTE-XXX early and obviously in We're cancer and United into will drive to lines cancer. to longer fact, launch growth about we penetrate in what the KEYNOTE-XXX lung now, In certain term both cell U.S. continue U.S. excited and in is could States the be of in lung markets help non-small the very how that in drive But internationally outside the importantly, as growing

RCC, in the good And in good growth setting, continued then adjuvant growth metastatic. across

of a opportunity because WELIREG, bladder with growth patients' difference as to answer lot The short of I'll drug. KEYTRUDA. with lives stop cancer. coming opportunity coming in which lot questions. get a is want there, in but a other a this make going forward to going we move we Great We're broaden there. growth, what's continue is our have of to to We with I could to on big go lot

Dana. Thanks, Great.

Next question Cedric. please,

Yes.

Wolfe Anderson Our Tim next question comes Research. with from

is line open. Your

lung Hi. the a Thank on TROP-X you. been question a the I Dean and of for debate a TROP-X well because Aztra's top and role response. III debate the on trial predicts focus as expression as asset better whether have recently, earlier biomarker come into Phase the newer of their from line of Kelun. key partly Kind it's started more year. higher trial this has And they

of factor views this on get of your specifically, to stratification biomarker. role to that do like include any upcoming as trials? III Phase you plan the I'd And in So a your

especially that Yeah. much the very you Thank for lung. relation about to in question TROP-X ADCs,

initially So depending as a metastatic, broader you that as others, has I But out, on play answer field to say question can go or KEYNOTE-XXX. picture, then is the and just we focus the would will dethrone about that of talk and more critical the may broadly. well us as cancer lung cancer, stages be earlier whether not those in how the it into

of dethrone metastatic care, So trying cancer. in standard in to pembro lung chemo all is cell first-line plus which non-small we're Merck's

will it's of to tried it, including to say, just lots I and high people to us bar a overcome. try do have

do if that? that the how field. that And be do will the so issue Because I prove you an for think important overcome you us very can that, ADC is for can

data. And comfortable that to we so give that impact ADC -- our it with are you the safety. It's KEYNOTE-XXX. can TROP-X something so we think the maximize very benefit the may But meaningful be over of have we important

is KEYNOTE-XXX high do be if beat. because what a biomarker think So KEYNOTE-XXX important I to could the you're bar is displace trying to

Tim. Thanks, Great.

Next Cedric. question please,

comes Goldman Sachs. from Chris with Shibutani The question next

is line Your open.

required what's you much. with some about had footprint, have we remind Any particular think new here recognize be to be filing potential what for And the the a and should quite in acknowledged you Thank With terms think have similarly, meaningful of in just think label? you And here. of third that data. for enthusiastic launch been a going you. regard then to commercial what of that terms very aware reimbursement Could of product, cadence? the commercial potential terms We in the we the would are you you XXXX? do quarter from standpoint? endpoints recognizing should in in physicians completed about sotatercept, what in with Thank progress the secondary your nuances us with expectations that

Yeah.

be is. science follow the of think trial take to STELLAR the In reasonably me will sotatercept in what in the that, I let that and label part So Chris. trial, STELLAR U.S. the the clear relationship of

death, We what think I that previously really our I a time the was didn't go-to-market we us to to that X-minute was really we clinical in than which for just had one things important outside the declare we creates different predicted when because scenario worsening important a U.S. it, is ability of declared that of walk. a and declared think

complete. in adopt you international that we may move I U.S., the speed within which file it we general label said the we that is forward, would it's markets be think And we've change given of the thought in would sense, that I will gives general that think previously are the as sotatercept. So the the part sense. the the be think I that this within where I we we hope important looking, least have and FDA. But think launching, with earlier But I XXXX. at

Yeah. is Rob. Chris, this

that NPAH. So on outside currently launch, we positioned. our the Adempas of market actually would United States, I the infrastructure that is question we're you and support well remind

We rare relationships U.S., the the -- to States, we're is be it. in of indications. infrastructure its to outside our add our more disease. in obviously, there. this able a And then going So United and Anyway, we'll leverage to first

this. actually prescribed XXX about at centers United have the specialty looking States You're in

a the focused as about this launch. with of -- relationships, out talking rare affairs, disease the capabilities, we're of This how complex large think footprint. journey a been physicians. diseases type we've particularly on do we not commercial And building So facing these we their and patients medical science liaisons of manage more kind is of

underway. already is work of lot A

quite can to expect both U.S. confident the the the prepared bigger this belief, much we be when the mentioned, be our label as we globally I'm than deal originally be outside is we'll Dean for in see. what Because and our U.S. launch, we So given did what will

States the as especially drug, for in known. waiting area already in We it. to for know already patients is point, the waiting far As your United the this it. specialists They're very reimbursement The it. are well goes, there understand

United speed So expectations for Outside a uptake cases, That to longer. of you will our in both or of than pretty reimbursement. drug expect in U.S., have think both the I we and the I volume is potential drive of uptake of we and especially total continue just revenue the expect. confidence when more stellar But think to drug, going the potential take the given States. strength could results in this to the total the and fast did the today what we're significant deal,

So we're this. bullish quite on

Great. Thanks, Chris.

more couple please, Cedric. questions for have We time

Yeah.

Citi. next Andrew question So with comes from Baum

open. is line Your

then for you. a Thank A Rob. and Dean for question clarification

-- TROP-X trials, So for outcome to with genomic patients particularly for and or actionable just plan second-line so in in you stratify your actionable select I'm about first mutation. regards without question those the clear, do -- first-line expression to TROP-X, previous just

Rob, unsuccessful, PCSKX if would outcome to So of are your at a within your Many or until cohort? oral the hand? And you select actually trials for repeal you the data efforts have going IRA the patient you delay second launch are stratify amend aimed to then that in thanks.

Yeah.

just don't of will cancer, first-line that roll But will we I think think actually cancer. selection. we that. into think as of in our what's biomarker TROP-X is that, important But just ADCs we're as me lung it I've at out. that to want given strategy of to thinking will care. emphasized, biomarker kind said come leave review especially of about ahead it when be design very what push cell the And take precise we I've the teams it a to of be the setting a standard for I as before, The important let get out want care, clinical lung non-small So on trials. too

still it's of Yeah. delay too early PCSKX to and And that on we kind we is or outcome the question how decision I outcome have of through. label make we’re and how we oral about study, the for frankly, study an of outcome because, working an think get we kind something not, the would study we what whether about think and think before

be. the So ahead points, And to get timing of understand to label, we study. understand need to the I where until would want outcome know we we wouldn’t of the need all those I

come. to more We’ve So one. got time some on that

Thank you, Andrew.

So last Cedric. please, questions

Yes.

Our question TD Scala with Steve Cowen. last comes from

open. is line Your

Dean realized? much. be there commercial it you read can you. A LOE neoadjuvant potential meantime? KEYTRUDA to the Thank for in How to Should adjuvant opportunity file do Thank setting? you KEYTRUDA per-adjuvant we on data think in is EFS approval the for cancer. expect the stacks the question the well And to so up in inhibitors ER-positive out CDKX/X before the so breast

bit. So I'll a back little just step

an it's stage, So is it's it that relationship that on release neoadjuvant/adjuvant. as the to the given in you've press earlier interim. We've an the -- HERX-negative, given KEYNOTE-XXX, [indiscernible] ER-positive based we've data is noted, in

you know, already event-based. EFS is As

they accrue events do the you answer how in your is And to will relationship just But we to And our because -- yes. so see are is event-based. fast that. the hope to question is have question

which and of at predictive stage, is that by CR highlight, breast, just future we've negative a would earlier positive a also demonstrated the followed I is which is in up is KEYNOTE-XXX, CR, neoadjuvant/adjuvant path EFS. path triple which also also

advances. that And just watch to so that we'll as data data have

Steve. Thanks, Great. Rob?

want I really value want their positioned I efforts. to we of am again, our across maybe future. Well, about shareholders And to to of call. into I to creation stakeholders and colleagues with for the just I for are drive to And for well great just confident how my patients, reinforce really for today the time substantial all the globe all just thank investing everyone conclude, continue appreciate how well Yeah.

you second of what we're across confidence difference really, prepared for the can XXXX progress comments progress in We today, really to do we hopefully, building in look area possibility. in our we ever the and and both of and the broadening an have beyond. on And half patients is making Q&A, the forward therapeutic the our took make from

So you. have now. it's us exciting what front we Thank of in right

Great. all. Thank you