Almirall, S.A. ($ALM)

Good day, and thank you for standing by. Welcome to the Almirall's First Quarter 2026 Results Conference Call. [Operator Instructions] Please be advised that this conference is being recorded. I would now like to hand the conference over to your speaker today, Pablo Divasson, Head of Investor Relations. Please go ahead.

Thank you very much, Matelena. Good morning, everyone. Thank you for joining us for today's quarterly earnings update, review of Almirall's first quarter financial results for 2026. As always, we are sharing the slides we are using today in the Investors sections of almirall.com. Please move to Slide #2. Let me remind you that information presented in this call contains forward-looking statements, which involve known and unknown risk, uncertainties and other factors that make our active results to materially differ from what we are serving today. Please move to Slide 3. Presenting today we have Carlos Gallardo, Chairman and Chief Executive Officer; Jon Gara, Chief Financial Officer; and Karl Ziegelbauer, Chief Scientific Officer. Carlos will start with the business highlights of the first quarter, to follow by uptake on biologics as the key growth drivers of our Medical Dermatology portfolio. Karl will provide you with an update on the pipeline and R&D programs. Jon will then walk you through the financials before Carlos concludes the presentation, and we open for questions. I will hand over to Carlos Gallardo, our Chairman and CEO. Please move to Slide #5.

Thank you, Pablo, and good morning to everyone in the call. Almirall delivered steady performance in line with our expectations and market consensus in the first quarter of 2026. The results reflect the high comparative rate in the first quarter of 2025, which was boosted by divestments alongside a minor revenue phasing effects across quarters. This anticipated and flat at the 2025 full year results presentation. Excluding the different effects, growth remains in line with the guidance and with the recent trends, being last 12 months net sales growth of 9% as of Q1 2026, consistent with our [ 2025 ] guidance. Which is why we remain comfortable reiterating our guidance with growth expected to be driven by our Biologics as well as the strength in our Core Medical Dermatology business. Growth this quarter is underpinned by effective commercial and operational institution, led by solid Biologics performance in [indiscernible] dermatology across Europe. We also continue to advance innovation broadened patient access support the physician community. Turning to products. Ilumetri delivered steady double-digit growth, reaching EUR 62 million in sales and remains on that to peak sales of over EUR 300 million. With EUR 42 million in net sales, Ebglyss momentum picked up in the last quarter following completion of the rollout across key regions with launches in key European markets continuing to scale. With 2026 now providing a clear reflection of the product potential, this strong performance reinforces our confidence its positioning and long-term growth prospects. Among other products, Wynzora continues to lead market share across key regions, while PlayCity delivered stable sales growth overall. We remain highly active within the medical dermatology community, continuing to strengthen our presence in the field. And the 2026 American Academy of Dermatology Annual Meeting, we presented more than 15 posters, featuring new data crosatopic dermatitis, actinic keratosis. Earlier in the year, Almirall hosted the 17th edition of skin academy, bringing together leading global experts in medical dermatology, focusing on the latest advances in Atopic Dermatitis and importance of individualized treatment in psoriasis. We are encouraged by our piling developments with 3 proof-of-concept studies currently in Phase II and a further 3 more POC studies on track to begin Phase II over the coming quarters. Most of these assets are either first or best in class. Our bispecific antibody targeting atopic dermatitis has progressed into Phase I. And we recently entered a new collaboration with [indiscernible] to advance the development of a monoclonal antibody with potential applications across multiple indications within medical dermatology. Karl will revisit our pipeline in greater detail. Please move on to the next slide for an update on our Biologics portfolio. In the first quarter, Ilumetri net sales reached EUR 62 million, marking a steady 12% year-on-year increase. The 2-year positive study results were presented a total, 2026 American Academy of Dermatology Annual Meeting and 2025 European Academy of Dermalogy and [indiscernible]. The data continue to high Ilumetri's long-term value, demonstrating meaningful real-world benefits in patients' well-being and reinforcing the POC clinical and commercial relevance. Ilumetri continues to demonstrate a solid position in the psoriasis circuit, maintaining market share in the leading anti-IL-23 class. Performance remains consistent, and we, therefore, continue to be firmly on track to deliver over EUR 300 million in net sales, even as both the product and the class enter a more mature phase of the growth center. Please move to the next slide on AbbVie highlights. Since the approval in Germany in December 2023, AbbVie has rapidly scale to become our second largest product, underscoring one of the most successful Atopic Dermatitis launches in recent years. This outcome reflects a strong patient and physician adoption supported by solid commercial and operational execution. At the same time, the Advanced Therapy segment in Atopic Dermatitis across the EU5 continues to expand at around 30% annually. First quarter sales more than doubled to EUR 42 million from EUR 19 million a year earlier, driven by the successful European rollout and continued scaling a [indiscernible] markets. [indiscernible] has already achieved double-digit market shares in several strategic regions. Alongside the currently early traction in new country launches. This underpins our confidence in place as a major growth driver in the years ahead. We aim to become a first-line treatment and capture increasing market share. We are confident in the [indiscernible] potential targeting the IL-13 as it is the predominant interlocking in AD patients, and this a broad number of clinical studies validating the products good efficacy which is the main factor in picking the most adequate treat. Our clinical collaboration with Lilly continues to support AbbVie's positioning through a growing body of evidence. The 2026 American Academy of Dermatology Annual Meeting, Almirall presented extended lebrikizumab data, including long results showing durable disease control for up to 40 years. Prior to that, Lilly published their adorable one pediatric study data, demonstrating significant screen clearance and improved disease severity and improved disease severity children with moderate to severe atopic dermatology. Please turn over to the next section for Karl to explain our pipeline developments in more detail.

Thank you, Carlos, and good morning to everyone on the call from my side. This slide shows you the status of our early and mid-stage pipeline. Today, we have 3 proof-of-concept Phase II studies ongoing with 3 additional study plan to start within this year. In 2025, we progressed our Anti-IL-1RAP antibody into Phase II for [indiscernible] and our IL-2muFc for [indiscernible]. In addition, our partner in [indiscernible] initiated a Phase II study on the ATomutantFc in atopic type. As a reminder, we retain global rights for this asset outside Greater China. Looking ahead, we plan to initiate one additional proof-of-concept study each for the IL-2muFc and the Anti-IL-1RAP antibody in an inflammatory skin disease. For the Anti-IL-12 antibody, we will start a proof of study inherent superlative in the coming weeks. The Phase I study of our bispecific antibody targeting IL-13/OX40L BsAb has just started. From those 6 proof-of-concept Phase II studies, we anticipate data readouts over the next couple of years, starting end of 2026, beginning of 2027. While these programs remain at an early stage, they address well-defined biological pathways and will send a range of first or best-in-class opportunities. Next slide, please. In March this year, we inagurated our business development office in Shanghai, China to advance innovation in medical dermatology through partnerships. This team is dedicated to life science innovation with a focus on brands and technologies that are complementary to our in-house R&D activities. A good example of what we intend to do is our collaboration with [indiscernible]. We announced recently for development of a novel monoclonal antibody in medical dermatology. For this collaboration, we proposed a target for an attractive skin disease and [indiscernible] will conduct early research and initial development to deliver clinical proof of concept. While Almirall holds global rights outside China and leads further global development and comaterialization. Next slide, please. This slide gives an overview of our life cycle management activity for products that are on the market, and I would like to highlight a few new developments. For turbanibulin applied to a larger treatment area of 100 square centimeters, the regulatory process is ongoing, and we expect launch in Europe late 2026. Together with our partners, Sun Pharma and a Lilly, we continue advancing label expansion opportunities and generate additional clinical data for Ilumetri and [indiscernible] respectively. Let me share some recent data on the next slide. At the AAD 2026 in March this year, we presented clinical data that showed that lebrikizumab delivers long-term disease controls for up to 4 years in patients with moderate to severe atopic dermatitis. In the Adlo Phase IIB study, 94% of patients maintained EASI-75, 75% maintained EASI-90 and 68% kept clear or almost clear skin defined as an investigator global assessment score of 0 with up to 4 years of lebrikizumab treatment, reinforcing the sustained response achieved over time in patients with moderate to severe atopic dermatitis. Importantly, itch relief was also sustained over the long term, with 78% of patients achieving a 4-point or greater improvement on the pruritus numeric rating scale with measures each in tendency on a scale from 0 to 10. Overall, these results further reinforce long-term disease control potential of lebrikizumab in a chronic condition requiring sustained and consistent treatment. Next slide, please. The [indiscernible] Phase III study met co-primary efficacy endpoints with 63% of pediatric patients achieving meaningful skin improvement EASI-75. 44% of patients reached clear -- almost clear skin, ITA-001 at week 16. ADorable 1 is a multicenter renders double [indiscernible] placebo-controlled Phase III trial and 363 children and adolescents with a moderate to severe atopic dermatitis that evaluates era versus placebo on top of standardized low to medium potency topical corticosteroids. Given the substantial physical and emotional burden of atopic dermatitis, particularly when disease on sets early in childhood these findings further strengthen the role of lebrikizumab across the full patient churn. BFL data will be presented at an upcoming scientific meeting. We plan to use these data together with the forthcoming results of the ADorable 2, which is the open-label 52-week extension trial of a ADorable 1 to file for an extension of the label of lebrikizumab to the pediatric population at 6 months to 18 years. Finally, we initiated our Phase III study to explore lebrikizumab in patients with numulaexzema. The readout is expected in 2029. With that, I will hand over to Jon for the financial review.

Thank you, Karl, for the exciting pipeline update, and good morning, everyone. Net sales increased by 2.2% year-on-year in the first quarter of 2026, reaching EUR 291 million, which is in line with our expectations and consensus. Last 12 months net sales growth of 9% as of Q1 2026 is equally consistent with our 2026 guidance. As Carlos mentioned earlier and anticipated in our full year 2025 earnings call, the first quarter of 2026 needs to be viewed against the divestment of [indiscernible] and out-licensing of [indiscernible] Q1 2025. In addition, we also had some minor pacing of sales amongst our paid products in Derma and non-derma between quarters. Excluding these effects, growth is in line with our expectations and provided guidance, allowing us to remain on track for the full year 2026 guidance. Performance remains solid, and European dermatology portfolio continued to deliver solid growth, further reinforcing Almirall's part towards leadership in medical dermatology. Gross margin landed at 64.2% is likely above the performance that you may have seen in the prior quarters. There is still a minor recurrent pressure that you should take into account primarily due to the higher royalty tiers associated with Ilumetri's net sales growth. EBITDA came in at EUR 67.5 million, reaching 23.2% of our net sales versus 21% ratio reported at year-end 2025. SG&A declined by 1% versus prior year and is expected to pick up in the coming quarters driven by phasing of our marketing and promotional activities. R&D investment reached 12% of net sales driven by phasing of our R&D activities as our POC trials progress [indiscernible]. In sales, 12.5% remains a good proxy for the full year. We closed March 2026 with a net debt-to-EBITDA ratio of 0.1% after successfully completing the issuance of a new hygiene bond at 3.75% interest rate back in December 2025. Overall, the results lead us to reiterate our 2026 guidance. Let's move to the details of our sales program on the next slide. European dermatology portfolio continued to perform strongly, delivering 19.3% year-on-year net sales growth in the first quarter. We will go into more detail on this performance on the next slide. The comparison impact was concentrated in Europe, where general medicine and OTC sales reflected a stronger prior year base due to the [indiscernible] divestment and outbases in of [indiscernible] alongside the mentioned facing effect from a smaller portfolio areas. Lower sales in legacy products such as Crestor [indiscernible] were largely offset by contributions from [indiscernible]. In the United States, performance declined year-on-year, which we will discuss on the following slide. In the rest of the world, overall sales were slightly higher with solid dermatology growth more than compensating for a modest decline in general medicine. Let me take you through dermatology performance in more detail on the next slide. Our European Dermatology business continued to perform well in the first quarter. Ilumetri delivered sustained year-on-year growth while [indiscernible] further increased its contribution, now with launches across all key European countries being completed. AbbVie generated EUR 42 million in the first quarter, referring continued scaling and reinforcing our confidence in its long-term growth potential. We continue to work hard to unlock the full value of the franchise for both the commercial and the R&D side. With Zoran continued to build market share, gaining traction across core European countries. [indiscernible] demonstrated a stable growth in Europe [indiscernible] in spite of some phasing in sales against prior quarter. [indiscernible] sales were slightly soft following a strong Q4 2025. In the United States, overall performance declined, reflecting continued pressure on the legacy portfolio. Products such as Codran Tape, Tazorac and Axon remain impacted by ongoing generic competition. [indiscernible] lower sales amid intensifying competition and exchange rate evolution. In the case of Fly City, the exchange rate evolution impacted growth negatively by 10 points in the quarter. Additionally, our market strategy to broaden coverage and increase volume [indiscernible] and year-on-year price pressure, expecting sequential quarterly improvement during the year. In the rest of the world, Dermatology sales increased year-on-year, driven primarily by [indiscernible] demand in China. Overall, our dermatology franchise continues to show solid underlying performance. Let's briefly review the remaining elements of the P&L. Gross margin reached 64.2% in the first quarter. Last year, gross margin benefited from the already mentioned divestment and out-licensing. Aside from this impact, we see continued slight margin pressure primarily from higher royalty tiers associated with Ilumetri continued growth. SG&A expenses accounted for 41.8% of net sales compared to 43.1% for the same period last year, which is in line with our expectations and pacing throughout the year. As highlighted earlier, SG&A is expected to increase in the coming quarters, driven by phasing of our marketing and promotional activities. We continue to anticipate SG&A full year growth to be slower than sales growth, becoming an important contributor to our EBITDA margin expansion guidance. R&D investment represented 12% of net sales, a full year ratio of around 12.5% remains a good proxy with the normal quarterly variability expected. Financial expenses increased versus last year driven by the valuation impact of the equity swap in 2026 following the share price evolution. Finally, our effective tax rate came in at 34.6%, which represents an improvement of 5.1 percentage points year-on-year. We continue delivering on this positive trend, driven by the strong increase in the group's overall profitability which materially reduces the relative impact of our U.S. business at the consolidated level. Please move to the next slide to take a look at the balance sheet. Our balance sheet remained able as of March 2026 compared to December 2025. Intangible assets grew in the quarter, driven mainly by EGI-related lifecycle management activities the development milestone payment to Simcere, [indiscernible] medium protein progresses into Phase II and a small upfront access fee linked to the new [indiscernible] collaboration [indiscernible]. This increase was more than offset by higher amortization resulting in a modest decline in goodwill and intangible assets during the quarter. Also, the payment this quarter of the 2025 [indiscernible] milestones is driving the reflected decrease in current liabilities. Our [indiscernible] ratio stood at 0.1 continuing to provide us with a strong financial flexibility. The increase in net debt primarily reflects higher cash outflows related to investing activities. Let's now come to the cash flow statement. Cash flow from operating activities reached EUR 47.9 million, an increase for EUR 21 million compared to the first quarter of 2025, driven by working capital improvement. Cash flow from investing activities amounted to minus EUR 72 million, an increase of EUR 52 million versus the same period last year. The increase largely reflects the payment of the 2025 $55 million, Ilumetri sales milestone, which has leaked into the first quarter of 2026. I would like to highlight that this is the highest mass com payment, exiting the year in the absence of new transactions. Projected investment related payments in the remaining quarters are marginal and the total estimated tax flow related to investing activities for the whole year remains within the usual list. Cash flow from financing activities was minus EUR 3 million, representing an improvement compared with a minus EUR 9 million in the first quarter of last year. The year-on-year difference mainly reflects the change in the new board structure issued at the end of last year. With that, I would like to hand the word over to Carlos for his closing remarks. Thanks a lot, everyone, for your attention.

Thank you, Jon. To reiterate, the business remains solid despite the optically lower growth first quarter figure. We also remain very confident in the 2026 outlook and our ability to deliver on our targets. We know where consensus sits today, and we can confirm we are comfortable with these figures. Turning to the key drivers of the business. First, our Biologics portfolio is giving us real momentum. We are operating in a dermatology market that continues to expand, and we are doing so with a portfolio that is both diversified and as well aligned with where unmet needs remain highest. This is reflected in a pipeline that spans immune-mediated skin diseases, [indiscernible] dermatology and nonmelanoma skin cancers. From a development standpoint, we currently have 3 programs in proof-of-concept Phase II, with a further 3 expected to enter in the next 9 to 12 months. Taken together, this provides a solid base to support sustainable growth over the coming years without concentration on any single asset. In parallel, we remain disciplined but active on capital deployment. We continue to assess selective bolt-on opportunities in commercialized assets while screening early-stage licensing opportunities, where we see differentiated science and a clear strategic fit. Most importantly, execution remains young. We're translating strategy into delivery staying on track to achieve our midterm options for double-digit net growth through 2030 and a circa 25% EBITDA margin by 2028. Abbvie continues to scale across Europe while Ilumetri is being managed dramatically as it moves through a more mature phase of growth. Overall, this combination of pipeline depth, financial discipline and execution give us confidence as we continue to advance Almirall towards leadership in medical dermatology. With that, we'll conclude the presentation and turn to Pablo for the Q&A.

Thank you very much, Carlos. Magdalena, back to you for the Q&A, please.

[Operator Instructions] And our first question comes from the line of Shan Hama from Jefferies.

Just two for me, please. So as we can acknowledge there's quite a notable acceleration in Ebglyss in 1Q versus the prior quarter. Is this the sort of the level or we should be anticipating throughout 2026? So that's my first question. And then my second is which countries have really driven this acceleration? And where do you see a more pronounced prescribing behavior for Ebglyss?

Thank you, an for the question. So yes, Ebglyss is showing a very, very strong momentum. When you look at the recently published [indiscernible] studies, utilized is not a surprise as we at achieved near complete skin clearance and its relief in up to 40 years. So that translates into what the physicians and dermatologists are achieving treatment goals in most of the patients. And that's what's driving the success of Ebglyss. The vast majority of dermatologists go to an inhibitor to treat moderate to severe [indiscernible] patients. So very pleased with the results as well, and we expect so confident with the consensus, and we're very happy to confirm the guidance of achieving more than [ 450 million pixels ]. In terms of which countries are driving, of course, we have launched in the vast majority of the countries where we wanted to launch. So all countries are performing well. We have double-digit market share in most of them. But also importantly, we have the recently launched countries, Italy and France that now are contributing. So they are adding the sales of Ebglyss. So the recent performance and the acceleration has been driven for the improvement of these 2 new important markets to accounts where we have launched Ebglyss.

Our next question. comes from the line of Damon Choplain from Stifel.

First one on the IL-2muFc. So what level of clinical efficacy and differentiation would you need to see in Phase II to trigger a Phase III programming? And would you plan to run and finance a global study? Or would you consider limiting it to Europe? This is my first question. And maybe a quick one on Ebglyss. Is the pediatric population included in your peak sales guidance?

Thank you, Damien, for the questions. I will take the latter, yes. The pediatric indication is included in our picture estimates. And I will refer to Karl on our very exciting IoT program.

Yes. Thanks a lot, Damien, for the question. As you know, the IL-2muFc targets regulatory T cell. And with that try to restore immune hemostasis and we believe this mechanism has potential across different skin diseases, including alopecia areata as well as atopic dermatitis. Now in terms of future strategy, we, of course, need to wait for the data and the readouts and how they look like. But I see a lot of different options that we have given the mechanism. Also in terms of more global versus a European study, certainly, our goal is to maximize the value of this asset and one data ROA level we will look at all different options.

Our next question comes from the line of Jaime Escribano Mais from Banco Santander.

So my first question regarding Elis' positioning and performance, which has been very good. But we also see other peers doing very well, like in move, for example, and my question would be how do you see the competitive landscape? Is it that the overall market is expanding and that's why all the peers seems to be doing good? And so this would be my first question. The second one regarding Ilumetri, which we saw a decline quarter-on-quarter, but it's true that in Q1 '25, which was something similar. So maybe you can confirm how the product is doing or what's the outlook in Q2? And a final question, if I may, regarding SG&A, so minus 2% year-on-year in Q1, which looks quite content. What should we expect in terms of SG&A? Should we extrapolate this? Or you expect the growth rate to be slightly higher is quite low.

Thank you, Jaime, for the question. So let me take the first question about Ebglyss and competitive dynamics. And Jon will take the Ilumetri and the SG&A questions. So competitive dynamics in AD, I think it's important to remind what we've been saying in the last quarterly calls that, this market remains severely undertreated, only around 15% to 20% of patients that are eligible for advanced haptics prescribers. So we've always said that new classes will make no noise, of course, for promotion, and we'll expand this penetration, and that's what's having the growth of the market. So on that regard, new entrants, are beneficial towards this growth. In terms of positioning, there's very strong consensus within the dermatology community, the [indiscernible]. And therefore, the go-to product is another inhibitor -- and why? Because they achieved the treatment both, right? And IL-31, we are good at dealing with each relief, but not [indiscernible] with skin clearance. And that's why the [indiscernible] we've seen higher use in [indiscernible]. And in [indiscernible], they used more as a second line or third line patients as -- let me remind you that this is highly terrigenous patient population and not all the patients always respond to a first line treatment. Ilumetri, Jon, can you take Ilumetri and SG&A, please?

Thanks a lot, Carlos, thanks for the question Jaime. We start with Ilumetri. Yes, Ilumetri grew around 4% in the quarter which is aligned with the full year growth of 2025. It's true, as you mentioned that in Q4, 2025 isolated Ilumetri grow a bit higher, but so far, on a full year basis, we think Ilumetri will be continuing solidly in the range of the double digit, and we estimated and we shared in February earnings call. At the moment, we are quite comfortable with the ballpark of the market consensus for Ilumetri which is in the range of EUR 260 million. Ilumetri is competing in the IL-23 segment, which is the leading class for -- sorry [indiscernible] moderate to severe. And basically, the product recently we launched the Ilumetri 200 presentation, mainly a presentation that is performing well and is providing flexibility to the health care professional to individualize care, and we think it's one of the strengths we are bringing to them, okay. Switching to the third question you raised, Jaime, which is SG&A. Yes, SG&A in the quarter declined 1% versus prior year, reaching around 21% of our net sales is mainly driven by the phasing of our marketing and promotional activities. It's through this year that in some of our jurisdictions, the main campaigns are going to take place in Q2, and this is the phasing you see you may expect a certain pickup in the upcoming quarters and on a full year basis, as we disclosed in our full year 2025 earnings call in February, you can expect a lower growth of our than our net sales growth, and this will become a key contributor to the margin expansion at EBITDA level.

Our next question comes from the line Guilherme Sampaio from CaixaBank.

Three, if I may. The first one, if you could provide a bit more details regarding your change in strategy for [indiscernible] in the U.S. market. And the second related to -- second third related to readouts from competition and your position in the market. So there was a specific doubt on the 3 specific antibody from Pfizer in Atopic Dermatitis to [indiscernible] this quarter. Just wanted to check how are you seeing this data? And the second question on competition regarding the -- your products in the spot market considering the profile, how you are in the positioning in the near regarding competition, okay? How are you seeing that?

Thank you very much for the question, Guilherme. I will take the question on the U.S. [indiscernible] and Karl will take the questions on the readout of competitive products. So in terms of [indiscernible] U.S., the U.S. represent 3% of our sales. And in terms of -- and again, this quarter has been impacted by exchange rate. So also to take into consideration. In terms of the strategy for pricing has not changed. Of course, one of the things that we are trying to do is to broader [indiscernible] to increase volume, right? This always comes at the expense of a little bit of a price reduction. So what we're seeing here is, first, come with a price reduction and the [indiscernible] coverage. So you should expect to see increased volumes in the next quarter if we are successful with this change in -- with this push in expanded coverage in the U.S. Karl, back to you.

Yes, thanks a lot for the question on the competition. I mean, first of all, what prior calls a trispecific antibody covers IL-13 and IL-4, and we all know that maybe the IL-13 component is the more important. So we rather think of this of more bispecific antibody. There are a number of bispecific antibody now in early development, and this is due to the still high unmet medical need in AD and the heterogeneous nature of the disease, as Carlos mentioned. We have to see how these early data translate into later-stage data we remain very confident on our data that we see with Apple. Carlos mentioned, for example, the very strong maintenance of response for up to 4 year or the recent data that we have seen in the pediatric population. And also then finally, in our bispecific antibody where we combine the approach together with an Anti-IL-40 [indiscernible] ligand approach to validated mode of actions in atopic dermatitis that are highly complementary. Your second question was about AS and the competitive environment. HS is a disease again of a very high unmet medical need and the currently approved therapy, which are either anti-TNF according to experts only provide a limited benefit for patients, and we believe there is a lot of room for improvement. Based on, again, discussions with experts we have chosen approaches and targets that cover more than 1 part of mechanism as this is a very complex disease potentially driven by multiple and different part of mechanism. On the 1 side, the Anti-IL-1RAP cover 6 different cytokines or the IL-1 Super family, [indiscernible] and IL-36 alpha beta and gamma -- and based on data that were achieved or shown with antibody targeting is, the Anti-IL-1 Beta or the IL-36 component, we remain confident in this mode of action. On the other side, the Anti-IL-21, we are about to start the proof-of-concept study is a mechanism that covers both B and T cell pathophysiology. Again, covering more than one puzzle mechanism. With that, we remain very confident in the 2 assets and the mechanisms we have chosen.

Okay. Just a follow-up. There's a similar at least also targeting after Anti-IL-1RAP from [indiscernible] was recently acquired by [indiscernible] how is your positioning relative to this product?

Thank you Yes, there is a number of assets targeting Anti-IL-1RAP from Manoviand also one from Kantar. The Sanofi has started the Phase II. We are not aware that [indiscernible] has already started. And we will continue with our study, I believe, with our Phase Ia/Ib seamless design we will have a very good approach and will be able to be first with this mechanism in HS.

We have one more question, and this question comes from Natalia Webster from RBC.

I have two. Firstly, on your pipeline Phase I to the IL-13/OX40L BsAb by specific. I appreciate it's early days, but are you able to talk more on the opportunity you see here, particularly following data from competitor OX40 programs? And how you expect this program to sit relative to your current Ebglyss franchise? Secondly, just curious to hear a bit more on the scope of your collaboration with Heta and the expected financial impact from this?

Thank you, Natalia, for the questions. I think both of them are for you, Karl.

Yes. Thanks a lot for the question. Our bispecific antibody targeting IL-13 and the OX40 ligand combines 2 validated -- 2 clinically validated mechanism for the treatment of AD. For example, it is known that the innate immune system leads to IL-13 release that is not covered by the OX4O [indiscernible] pathway. And on the other side, while TH2 cells that secrete IL-13 are the main driver of AD in a lot of patients. There is also other T cell population involved that then can be covered by the anti-OX40 ligand blockage. So we believe this combination has a chance for a broader and deeper response in AP. As Carlos has mentioned that AD is still an underdeserved indication only 10% to 15% of patients who are eligible to advanced therapy actually get them. We believe there is a lot of room for novel therapy like this bispecific antibody. I think on water, that is a collaboration where we, based on our activities here in Barcelona came across a very interesting target and another approach for an important skin disease. We haven't disclosed the details before us of competitive reasons. And we have identified Rota as a partner with very significant experience in monoclonal antibody discovery and early development. Actually, the CEO of Harte was one of the inventors of Cares, which, as you know, is a very big product in the dermatology market. We haven't disclosed detailed financials. But as you can see in our press release, cumulative payments would sum up to USD 340 million, including upfront and milestone payments that are into the development and [indiscernible] success as well as tiered royalties.

And this question comes from the line of Jaime Escribano Santader.

Just a follow-up question on the pipeline for Carl. -- building on 1 of the products you just explained. So UCB has acquired and Therapeutics, mainly a platform, which is a bispecific antibody directed to B cells and CD3 on T cells. The first question is if you have a view on this approach. Second, does this -- is this similar or has something to do with the one you just that was targeting also B-cells and T-cells and just a reflection for the management or for Carlos. So you see this is willing to pay EUR 2 billion, which is like 2/3 of the market cap of Almirall while for platform that we see in Phase I, while you have several products, what do you think is missing for the market to put a higher valuation on your pipeline, which look much more advanced to biotechnical this one.

Thank you, Jaime, for the question. So before I pass the word to Karl to cast the problem that have mentioned, Again, we are a specialty company focused on medical dermatology where probably the only company in the Western Hemisphere that is has capabilities from other research to commercialization, and that's the only thing that we do and why because there's tremendous unmet need. So when we look at it, we see plenty of places pent of opportunity in diseases that don't have adequate treatment, and we have also the ability to come with plenty of novel scientific hypothesis and develop either programs internally or externally and so far our strategy is working. You can see it in our pipeline, and we've been able to either execute through licensing or through generating internal hypothesis and doing our products from scratch, right? So we do see other companies paying a lot of money for licensing opportunities for acquisitions. I can only speculate about the reasons and the market prices. But what I can confirm is that our strategy is working. We are being able to spot opportunities, we're being able to capture opportunities to licensing agreements or originating of internal programs, and we are very very comfortable with that strategy. Now back to you, Carl, about the program that Jaime mentioned.

Thanks a lot, Jaime, for the question. This program is a so-called T-cell engager that targets CD19 so pathogenic T cells. And this kind of approach is targeting with CD19 B cell in [indiscernible] oncology, so malignant B cells or in an autoimmune setting. So pathogenic B cells either through CAR T or T-cell engager have recently gained quite a lot of attention, and we are very closely following that space. Now to explore such a space and such an assay. This might be important and that might be a driver for UCB to go beyond dermatology. As you know, we are focusing on dermatology that is one angle to that. And I think another angle to it is that a lot of indications are not only driven by pathogenic B cells by pathogenic T cells as well. So this is an approach that is potentially not universally applied across all of the dermatological diseases we remain interested in.

Thank you. There are no further questions for today. I will now hand the call back to Pablo Divasson for closing remarks.

Thank you very much, Magellan. If there are no further questions, ladies and gentlemen, this concludes our today's conference call. Thank you for your participation. You may now disconnect.