Amgen Inc. (AMGN) Earnings Call Transcript & Summary

[Audio Gap] Joined by Peter Griffith, CFO; Justin Claeys, new Head of IR, Casey Capparelli, Executive Director of IR and the one and only Arvind Sood that everybody is known because he's been in IR for almost 2 decades, 2 decades, yes.

I joined back in the 20s.

Over the decade. So I thought maybe we'd start with some opening remarks from Amgen first.

Thank you very much, Juliette. Good afternoon, everyone, and thank you for being with us here today. As we always do at Amgen, we start with patients and our mission to serve patients through discovering, developing, manufacturing and delivering first-in-class and best-in-class medicines to patients with gravis and serious illnesses all over the world. We're creating value for patients, staff and shareholders and are well positioned on any number of fronts to deliver long-term growth. We're driving a successful integration beginning off of an early fourth quarter close with Horizon Therapeutics based on the exceptional fit between the 2 companies. We're driving the best innovation through our pipeline, and we're driving results as we did in the second quarter with record revenue and record non-GAAP earnings per share. We remain well positioned for continued volume-driven growth with 11% year-over-year volume growth in the second quarter, underneath that was 16% year-over-year volume growth outside the United States, and underneath that was 46% volume growth in our JAPAC region. Based on our strong second quarter and outlook for all of 2023, we raised our financial guidance for the year, just as we did after the first quarter. We're excited to be moving forward on Horizon, expected to close early in the fourth quarter, and it is a great strategic fit for us. So why is it a great strategic fit? First, their project products are innovative, first-in-class biologics that make a big difference for the patients who receive them. That is exactly the focus of our R&D strategy. And second, these products treat autoimmune disorders, which have been a core focus for us for decades. Third, these products are at an early stage of their life cycle with lots of ways for us to add value. Where do we expect to add value? Across life cycle management, including in global development, manufacturing process development, new formulations, delivery devices and so on. Delivering value in international markets. They hadn't yet built out their capabilities. Ours are in place and fully prepared to go on these new products, especially with TEPEZZA. An ongoing R&D, Sjogren’s and other potentially attractive markets, including those identified in our review of the genetics behind their targets using our deCODE team. So where are they going to add value to Amgen? Horizon's industry-leading rare disease capabilities will be an immediate benefit to TAVNEOS and other rare disease opportunities in our pipeline. And finally, as we've consistently said, we expect this deal to be accretive to our financials and additive to our long-term outlook. We will talk more about driving results in the business in a moment. But before that, let's cover our innovation and our pipeline where momentum is building, where multiple Phase III trials position us well for long-term growth. Our oncology pipeline includes any number of late-stage opportunities. We announced positive, potentially registrational results from tarlatamab in small cell lung cancer where we see annual incidents of 65,000 to 70,000 patients across major markets. The first BiTE molecule to demonstrate unequivocal activity in a common solid tumor. We're excited to share these data later in the year and are rapidly moving tarlatamab into earlier lines of treatment to maximize the opportunity for patients. And later this fall, we'll be sharing exciting initial data from Xaluritamig, our STEAP1 bispecific being studied in prostate cancer and AMG 193, our MTA cooperative, PRMT5 inhibitor, where we've seen responses across multiple solid tumor types. We announced positive top line Phase III results from LUMAKRAS in combination with Vectibix in metastatic colorectal cancer. And now let's turn to inflammation and general medicine. We continue to explore the potential of TEZSPIRE in multiple additional indications and then rocatinlimab, and atopic dermatitis continues to enroll Phase III very well as does Olpasiran, our Lp(a) molecule in Phase III. Maridebart cafraglutide or now known as MARI as Arvind has told us, and AMG 786, which are 2 of our obesity assets in our evolving obesity platform and are in Phase II and Phase I trials, respectively. MARI is enrolling well. The goal of this study is to generate data that will provide broad optionality to design a Phase III program. So turning to commercial performance. Our priority products within each therapeutic area performed very well in the second quarter. Our innovative hematology/oncology pipeline grew 10% year-over-year and continued growth opportunities in BLINCYTO, KYPROLIS and Vectibix. We saw a strong sequential growth across our innovative inflammation brands, including Enbrel, Otezla, TEZSPIRE and TAVNEOS, and we're making additional investments now into Otezla this year from a position of strength. And our general medicine portfolio, Repatha grew 30% in the quarter, 35% volume growth across the world, we see continued upside for Repatha. We're also making additional investments into Repatha this year, also from a position of strength. The bone franchise continues to deliver growth with Prolia growing 11% year-over-year and surpassing $1 billion for the first time ever in the quarter and EVENITY also in the bone portfolio growing 47% year-over-year. Our biosimilars portfolio continues to generate meaningful sales and meaningful returns for our shareholders. As we have consistently said, we see long-term growth driven by launches of new products and into new markets. We're excited about our recent initiation of a pivotal study evaluating ABP 206 compared with Opdivo, 1 of 6 planned new biosimilars before the end of the decade. So finally, we continue to execute on multiple capital allocation priorities in the quarter, investing over $1 billion in innovation, investing $300 million in capital expenditures, including into any number of artificial intelligence use cases and increasing our dividend by 10% year-over-year. So we're creating value for patients, staff and shareholders and are well positioned on any number of fronts that deliver long-term growth through driving a successful integration with Horizon Therapeutics based on that exceptional strategic fit, driving the best innovation through our pipeline and driving results as we did in the second quarter with record revenue and record non-GAAP earnings per share. And with that, Juliette, I'll turn it over to you, and you can drive some Q&A.

Perfect. Thank you, Griffith. So I wanted to start with an area that's been really popular in the press lately. It's not IRA, it's metabolic diseases. So in article often overlook this but Amgen had a major presence in the metabolic space for a while now. So I wanted to check in and see how the franchise is doing. So for example, looking at Repatha, which had a great second quarter, can you give us a sense of what's driving the continued growth? And where do you see the opportunity going?

Sure. Justin, would you like to jump in on Repatha? We call that the workhorse of our portfolio this decade, and we see cardiovascular disease as public health crisis, and it's just a super important product for us, but most importantly for patients. Justin?

Yes. So first, Juliette, thanks for the question. And I think just to reiterate what Peter is saying, we're really pleased with the growth that we're seeing from Repatha. I think what's really -- what you're really seeing this year and the reason you're seeing such positive performances at one, we're in a good spot from an access point of view where I think people recognize the benefit of the medicine and the coverage and the ability for patients to get the medicine at a reasonable co-pay, is very positive. And then the second is there's just this growing body of evidence that continues to accrue over time that reducing cholesterol to lower levels and as soon as possible, really has great outcomes. We have Fourier data that was extremely positive, and we continue to track that over time. And with each new readout and just keep reinforcing the message that lower is better and sooner is better. So I think there's really a lot of momentum in the cardiology world, and we've now increased our efforts with the primary care physicians. And so we feel like that's just momentum will continue.

And then as it relates to your pipeline in metabolic again, of an overlooked. You've got a really fascinating program in AMG 133. So what do people need to understand about the drug, both in terms of clinical differentiation, but also in terms of your go-to-market strategy in obesity.

So Casey, why don't you take that one?

So this is where obesity, normally, we put a couple of chocolate chip cookies in front of them to signify that, but we'll let him get into 133 obesity is a platform that we are really focused on, and we think it's very important for us to allocate shareholder capital to that opportunity.

Great. Thanks, Peter and Julia for the question. So from an obesity perspective, we feel strategically obesity is in the very early stages of development of the treatment of the disease. And as such, we're bringing forward a portfolio of obesity assets. We have a couple of obesity assets that are preclinical and haven't yet made the clinic. We have AMG 786, which is in Phase I clinical development enrolling well, and we anticipate having data from that asset in the first half of 2024. We haven't disclosed the target yet for AMG 786 but it's a non-incretin based small molecule target, something that we're excited about moving forward. And then you're all probably familiar with MARI, our AMG 133. That's our most mature obesity asset. It's a GLP-1 agonist in GIP receptor antagonist. It's based on a monoclonal antibody backbone, which provides a different pharmacokinetic characteristics than what we've seen with other therapies of this nature. We're currently enrolling and enrolling well a broad Phase II program with AMG 133 or MARI, are meant to address different dosing regimens, different dosing intervals, also looking at obese patients and diabetic patients. The idea being that we maintain optionality for designing the differentiated and competitive Phase III program is we generate data coming out of Phase II. Across our obesity assets, we believe that having multiple approaches here will ultimately be beneficial as the treatment of obesity evolves where you may need different types of molecules to address different subpopulations of a very heterogeneous disease as well as all of the associated comorbidities. So we're happy to have a platform approach. We're excited about the molecules that we have in the clinic and look forward to seeing data from each of those.

And to round up the metabolic space. You have a really interesting opportunity in Olpasiran, your Lp(a) inhibitor. Can you describe why you're excited about the program and what it could mean for patients?

You want to take it, Arvind?

Yes, yes, sure. So yes, a couple of thoughts, Juliette. First of all, when you think about Lp(a) reduction, this is something that elevated levels of Lp(a) impact about 20% of the population. What's notable here is that it's a nonmodifiable risk factor. So regardless of dietary caution, regardless of the level of exercise that you exert, this is something that is genetically fixed. The Phase II data with our Lp(a) inhibitor was actually quite profound. We saw a 90% plus reduction in Lp(a). And largely on that basis, we have now commenced a Phase III trial. And this is -- the largest 6,000 patient study is cardiovascular outcome study. And basically, what we are looking to demonstrate is that does this profound reduction in LP(a) result in better outcomes in terms of fewer cardiovascular effects. So that's what the data would show.

And moving on, we saw TAVNEOS had a really good quarter, second quarter with $30 million in sales, 30% growth quarter-over-quarter in volume. So as AAV is a new market for Amgen, could you comment on how the product tracking relative to your expectations? At the time of ChemoCentryx deal? And also how you're thinking about the broader label expansion opportunity?

Well, Julia, thank you very much for the question. TAVNEOS is the component of the ChemoCentryx acquisition that we completed in October of last year. And it's just an outstanding medicine for this rare disease of ANCA-associated vasculitis. It's the early days. We had 28% quarter-over-quarter volume growth in the second quarter. We're augmenting the growth of TAVNEOS with our many decades of working with rheumatologists and nephrologists. We think there's a great fit there. Remember that TAVNEOS represents the first step forward in ANCA-associated vasculitis treatment in many years, too many of the patients are still suboptimally treated with immunosuppressants. And finally, we think there's about 2,000 U.S. patients that have now been treated with TAVNEOS, and we've characterized the addressable market is about 8,000 to 10,000 patients annually with severe disease or major relapse. And we see the approved label as an attractive growth opportunity. And so we think there's still meaningful growth for TAVNEOS from here. It's a debilitating very serious rare disease. So we're excited to be able to continue to see the growth there for patients.

And another robust source of growth actually was TEZSPIRE. We know Amgen launched its self-injector in Q1, and there are also multiple expansion trials in initial indications. But what are your thoughts on the total market opportunity as well as Amgen's positioning within it?

Let me make a couple of comments on the market position and that, and then I'll ask Casey to maybe give us a few comments on the development program around TEZSPIRE. Look, TEZSPIRE is a fantastic medicine for people with severe asthma. The date has been really strong. We think there's about 1.3 million or so patients in the United States with severe asthma that who are potential candidates for this about 2.5 million worldwide. We're seeing utilization across the eosinophilia continuum on this as all of you are probably aware, it's the only approved treatment down for low eosinophilic. And so we're very excited about that. We anticipate growth both from low and high EOs on this in that segment of the market. And we think that the majority will still come from HCP administered setting or it's still coming from there, but the recently approved PFP, the prefilled pen has contributed to the products 37% and sequential growth quarter-over-quarter -- so volume growth quarter-over-quarter in the second quarter. So the PFP coverage has been secured at the 3 major PBMs, and we expect to support continued uptake through the remainder of 2023 based on that. And I would -- we have 4 development programs around TEZSPIRE, and I think it would be great to have Casey give us an update on this.

Sure. Happy to do so. Thank you, Peter. So we do have 4 different additional indications that we're pursuing with TEZSPIRE. The rationale behind it is with TSLP, which is the targeted TEZSPIRE being at the top of the inflammatory cascade, it makes sense to explore a variety of additional inflammatory conditions. We have 2 Phase III trials underway, 1 in chronic rhinosinusitis with nasal polyps and another in eosinophilic esophagitis. The former of those, we actually saw some data from our severe asthma studies where we saw some efficacy in that patient population, which provided us even further confidence beyond the biology to run a Phase III study. We also have 2 Phase II studies underway. We have a COPD study that's underway that's enrolling a broad population of patients. I mean, in COPD, we see bronchial lavage samples as well as molecular analysis from COPD patients that show evidence of TSLP expression. And so while it's -- we're optimistic about, we're cautiously optimistic, I guess, is the best way to characterize our efforts in COPD, and we anticipate having data from that study in the first half of 2024. The fourth indication is chronic spontaneous urticaria. We have the final analysis data from that study in hand, and we're currently actually reviewing those data with AstraZeneca, our partners as well as with external experts, and we would anticipate reporting results from that study later this year.

And then Otezla has had some headwinds with newly launched competitor free drug programs. And on the second quarter earnings call, you mentioned you expect this impact to continue for the rest of the year. What's the feedback you're getting from the market? And what are the KPIs that you've been tracking?

Do you want to take it, Otezla?

Yes, certainly. I think the first point on Otezla that we really feel like it is a unique and differentiated product in the sense that it's the only systemic therapy that's approved across the whole range from mild, moderate to severe. And we feel like there's really a very good position for it in terms of if you have patients who have tried topicals and that hasn't worked. And so that sort of post-topical prebiologic. I think it's a place where Otezla fits very well in the sense that the -- it's well known to physicians and providers. The safety profile is quite well known. The access is quite well known. So I think we're very encouraged by the overall product profile and positioning. It is, as you pointed out, rightly, this year is a bit -- the waters are a bit muddied with all the free drug that's in the channel both through new competitor products in various aspects of the space. So I think in terms of what we're looking for in KPIs and whatnot, I think, certainly, we continue to monitor the share trends, the new shares and whatnot. But I think we'll have a better picture as the free drug kind of works its way through the channels.

And sticking with the inflammation then here, Juliette seems to have bounced back this past quarter, thanks to improved payer coverage, notably, leading to a 6% increase in new patient starts in the U.S. What are your thoughts on its recent performance? And what's the long-term outlook? And also, how are you viewing the pricing pressure and concern around the biosimilar activity?

Yes. So Enbrel, Juliette, first of all, has been in the market for a number of years. So we have a very well-established track record from a safety and efficacy standpoint. And I think that really serves us well. I think what you saw in the performance of Enbrel in Q1 was somewhat of an aberration. You saw -- what I would say was an unprecedented drawdown in inventory levels in general kind of across the board in the so-called I&I, the immunology and inflammation business. And I think Enbrel was also impacted by them. As you kind of look into the second quarter, we saw actually a strong recovery in those inventory levels. So that's point number one. In terms of I think what was encouraging is that if you look at the underlying unit volume trends in Q1, they were positive. So we felt that, that would serve us well as we got into the second quarter and thus also being aided by the fact that we struck a deal with 1 of the major PBMs, Optum in Q1. So that's driving some of the volume growth that we have seen. Our thinking in terms of the outlook for Enbrel, as we steer into the second half of the year is that unit volume trends should remain relatively stable. From a pricing standpoint, I think it's likely that you'll see some continued pressure because it's a very competitive category.

And you also have an exciting molecule in inflammation Rocatinlimab in atopic dermatitis. What should we know about the opportunity?

Rocatinlimab is fantastic medicine coming up through our pipeline. And I think I'll have Casey speak about it to do it justice with. This is a collaboration, a partnership we have working with Kyowa Kirin, and we're just really excited about it. Casey?

Sure. So rocatinlimab is an asset that we're pursuing in atopic dermatitis. It's in Phase III in that setting. We have actually a very broad comprehensive Phase III development program underway for rocatinlimab. It's a 7-study program called the ROCKET program. And in the context of that program, we're looking at treating patients that are naive to biologics and JAKs in the atopic dermatitis space as well as experienced patients that have been treated with a JAK or with the biologic. And in fact, in our Phase III study, we saw about 14% of patients had previous biologic experience, and we saw similar efficacy to those that were biologic naive. So we're encouraged by that profile. We're also looking at both adults and adolescents. And so running a very comprehensive program to treat a broad swath of moderate-to-severe atopic dermatitis patients. And we look forward to continuing to progress those Phase III clinical studies, all of which are enrolling quite well and are encouraging for us as well as for patients in the field. I'd also add for rocatinlimab, we've just -- we're planning to initiate a Phase II study in moderate to severe asthma as the first of a number of additional indications that we're considering for that molecule as well.

Great. And moving on to your oncology franchise. Can you give us a sense of how do you feel about LUMAKRAS in frontline? And how do you feel about the commercial opportunity there?

So yes, so let me offer a couple of comments there. So first of all, LUMAKRAS today is the only KRAS G12 -- well, it was the first KRAS G12C inhibitor that was commercialized. But it's relegated to second-line non-small cell lung cancer. So we certainly see some potential to take it into earlier lines of therapy. Now recently, Juliette, we actually posted some -- communicated some top line data of LUMAKRAS in combination with 1 of our own products, EGFR inhibitor, Vectibix in third-line colorectal cancer. And the results, I would say were very consistent with what we had previously reported from a Phase II trial. But we have a couple of trials, which we are looking at now. One would be a combination of LUMAKRAS with chemotherapy in PD-L1 negative patients with PD-L1 negative tumors. And then we have another study in which we are looking at a combination of LUMAKRAS together with Vectibix and chemotherapy as defined by FOLFIRI, which is an irinotecan-based regimen. And this is something that we are evaluating in first-line colorectal cancer. So again, there are measures in place. There are studies that we are evaluating to move the product in earlier lines of therapy.

Great. And then I wanted to ask about a couple of key pipeline projects. First, tarlatamab in small cell lung cancer, which has strong safety and efficacy data and could be first-in-class. How do you feel about the commercial opportunity in the space?

Well, let me just make a comment and then I'll ask Casey to give us some detail on the asset itself. Tarlatamab as Dr. David Reese, who many of you know, is Head of our Research and Development and himself a medical oncologist he said tarlatamab represents a huge advance for the field in the sense that it's the first bispecific T cell engager or BiTE to demonstrate unequivocal activity in a common solid tumor. And so -- it's really important for patients, and we are all pleased and very, very happy at Amgen about that. And there's any number of ways that we'll move forward. But rest assured, we see an opportunity to allocate capital behind tarlatamab to get it to patients as fast as possible, subject to the discussion with regulators and data and so forth. And I think we should spend a little time on this. So Casey, why don't you jump in and give us a little more detail on tarlatamab, which is a big advance.

So tarlatamab is our DLL3 targeting bispecific molecule. As Juliette and Peter said, we're studying that in small cell lung cancer where we have potentially registrational data that just read out of the top line and far exceeded in terms of response rates what we saw in the Phase I trial for that study. And just to remind you, in the Phase I study, we saw a little over a 20% response rate in third line or in later small cell lung cancer patients, patients that typically have only 4 to 5 months of survival. We also saw a durability of response and survival data in that Phase I study of greater than 13 months. And so we're encouraged by seeing a more robust Phase II data set. And as I said, with response rates that dramatically or substantially exceed what we saw in Phase I we'll be presenting that full data package at a Medical Congress later this fall. And I'd also indicate that in that Phase II study, we saw improved safety and tolerability relative to Phase I as well. And so a really exciting data set for patients, and we look forward to sharing that with the field later this fall. Additionally, on tarlatamab, we're investing behind tarlatamab to move it into earlier lines of therapy. We have a Phase III study ongoing in second-line small cell lung cancer, and we'll be initiating 2 additional Phase III studies in earlier lines of small cell lung cancer as we seek to rapidly move tarlatamab forward in the treatment paradigm and to really try and maximize the benefit of this exciting molecule for patients with small cell lung cancer.

And you've also highlighted that you have initial data from Xaluritamig and AMG 193 later this year. What should we know about those 2 opportunities?

I'll jump on Xaluritamig. It's a first-in-class STEAP1 targeting a bispecific being studied for advanced prostate cancer, where STEAP1 is expressed in almost all tumor cells. So we're seeing significant antitumor activity with this molecule and we're rapidly enrolling dose expansion cohorts. Xaluritamig also provides an example of unequivocal activity by a bispecific T-cell engager in a common solid tumor. So again, it's exciting. It's part of our BiTE portfolio, and I might just divert for a moment and suggest the first BiTE we had that showed activity and is incredibly successful and even more so now as BLINCYTO in acute lymphoblastic leukemia and certain indications in that. So having a second one now in the common solid tumor area Xaluritamig is really meaningful to us, and most importantly, for men who have prostate cancer that's advanced. So we're excited about Xaluritamig, and it's a really important one. AMG 193 is a first-in-class small cell molecule. It's MTA cooperative PRMT5 inhibitor being studied in patients with advanced MTAP-null solid tumors. So alterations in this pathway occurring about 15% of solid tumors, and we're currently enrolling a Phase Ib/II study of 193, and it's early, but we're encouraged by the antitumor activity that we've observed in multiple tumor types with AMG 193. So we look forward to sharing data from both Xaluritamig and AMG 193 later this fall. As Casey suggested at a medical conference. So both really exciting.

Great. Thank you, Griffith. And let's spend a minute on biosimilars where Amgen has been one, if not [indiscernible] creator. Now obviously, some very high-profile blockbusters that are going to hit their LOE in the next few years. But it seems that for Amgen, it could be a major opportunity on AMGEVITA, just to name one. Can you tell us a little more about the strategy and your positioning to get those -- this market opportunity?

Yes, certainly. And maybe just to start with the big picture. Obviously, our -- core of our business is our innovative drugs that have a large effect size that treat gravis illness in our therapeutic areas of choice. With that being said, what we found is that the biosimilar portfolio has been a great complement to that as it really leverages the capabilities and the skills that we have as a company. And so what we talked about at our business review last year was that we would more than double the 2021 revenues that we had out of the biosimilar portfolio by the end of the decade. And so really, what we've seen play out and what we expect to continue is that we have these waves of launches as the products go off patent and then we launch new ones. And again, I think the fact that it -- what we've said previously is that the biosimilar business is not dilutive to our margin because it leverages our existing infrastructure ability so well. So that's just to kind of frame up the overall opportunity. So in terms of the specific ones, where we've really seen, I think, success and probably see more of the growth coming from in the future is more of the Part B, the buy-and-build type drugs. Internationally, the biosimilars are doing well also. I think with more of the Part D setting, and you mentioned AMGEVITA, I think that's an area that we've mentioned that there would be more of a gradual uptake and it's still evolving. So we'll obviously continue to monitor that one closely. But I think that's kind of how we see the biosimilars.

Juliette -- sorry. Go ahead, Peter.

I was just going to jump in too and mentioned because biosimilars is very meaningful for us and Justin covered it perfectly. And just add on that our history of biologics is wonderful for us when we get in to this market to get it out. Our -- the patient experience with Amgen products is strong and helps us. Our supply chain reliability is incredibly important to providers, patients and payers and historically and in biosimilars, of course, we commercialized biosimilars through our commercial therapeutic groups. So AMGEVITA, for example, is commercialized with Otezla and Enbrel and TEZSPIRE in the inflammation immunology group. And then finally, our patient support system is the same for the biosimilars. So it's woven into what we do, and we're passionate about it. It's an opportunity for us to serve more patients and be a very responsible and important part of the health care ecosystem. So we're -- we look at biosimilars all the time, and we're pleased we're in it, and we're continuing to work hard for patients with biosimilars. And we think as Justin said, it provides strong returns for our shareholders.

Yes. I was -- you covered the very point, Peter, that I was going to mention. I think in an environment where this model is being questioned by some companies. I think the reason the model works for us is exactly for the reasons that Peter mentioned. I think it's also important for investors to keep in mind that what drives this business, the drivers are a bit different compared to what you see on the proprietary kind of the branded drug side. And that this business will grow through the addition of new products and the addition of these products in new geographies. And hence, the target that Justin alluded to earlier, that based on our 2021 revenues we believe, through the addition of new products between now and the end of the decade, we can more than double those revenues.

And another hot topic in the biopharma industry is AI in drug discovery and in drug development. So some [ words of you ] it has the potential to be a major disruptor within the space. But I would love to hear your thoughts on how do you see it fitting at Amgen, both on the macro level and willing strategy?

Well, there's no question we're at a hinge moment in our industry in the fusion of biotechnology and technology. And artificial intelligence is a key part of that. At Amgen, we've been using analytical AI for any number of years. And now, of course, we're into using also generative AI. Many of our research and discovery efforts in terms of target identification, target getting more specific on what the targets are going to be and being able to use it that way. And think of it at Amgen in terms of we've created and executed on any number of sub-functional inside commercial, inside manufacturing, inside research and development and inside our G&A activities. Any number of use cases and successfully executed on that Juliette, and at the same time, that builds up into larger functional use cases that we've successfully executed on, and then that builds up into enterprise use cases. And so we think it's very important in what we're accomplishing to be efficient across the enterprise and maintain kind of where we're up towards the top in terms of industry-leading margins and continuous improvement and work along those lines. So that's really, really important. It will create -- Amgen is a more -- we think of it as a more forward-looking organization. It's really important from that standpoint. We're continuing to allocate capital behind that. And we think it will allow us to more quickly and accelerate developing medicines for patients in research and development. We're using artificial intelligence in our 2 new leading-edge facilities. We've got a drug product plant that will be -- will fully expect to be online licensed and up and running in 2024 in Columbus, Ohio, and we've got a leading-edge drug substance plant we expect to be up and running in 2026 in North Carolina, both of which are using the latest and most advanced artificial intelligence products and mechanisms to make sure we're working as efficiently and effectively as we possibly can. So we'll continue to interrogate use cases research and development. A lot of the activity we're doing to think about value and what's going to happen in the industry beyond 2031. We're using it. We call that BioNext, and we talked about it in our business review in 2022, and there's a large part of value created there. And using AI, they are super important. We talk a lot about our deCODE subsidiary and deCODE has 200 petabytes of as we call it, data around human diversity. And so to kind of move that around and use it thoughtfully and efficiently, it's important to take advantage of artificial intelligence. We then move into process development and into manufacturing and into commercial and using it in each one of those areas. And commercial, as you can imagine, a very simple use cases, where the reps go next. They get on their iPad and can use AI to send the next best stop to help get medicine more quickly to the next patients and providers. And finally, in G&A, we use it across the G&A platform to become as efficient as possible. I can't cover this without saying too, it's important for us at Amgen as to the how on artificial intelligence. We want to make sure it's used responsibly, thoughtfully, securely. We think a lot at Amgen about how important privacy and of our patients data and so forth are and we're very careful about that and very thoughtful about how AI is used. So that's always right on the forefront of what we're thinking about as we design and use these new use cases. So I just want to make sure I'm clear on that. So that's -- I wanted around several different places but that's what artificial intelligence is. And I've had fun using it myself and trying to make myself more efficient. I know a number of my colleagues in the CFO industry, both inside and outside our industry are using it and it helps us move along and stay as current as possible.

I still haven't tried. I was telling you earlier, I was late on IRA, I'm late on AI and IRA.

All right.

But [ virtually ] you'll teach me and...

Talked to ChatGPT about that [indiscernible]

I'll try. To close our presentation, I wanted to touch on the capital strategy before. How should investors think about the capital structure and how is the company thinking about future BD opportunities?

Well, let's talk about 2 things. Let's talk first about, investors should think about our capital structure right now as it's a thoughtful capital structure designed to accelerate the closing of Horizon early in the fourth quarter. We've obviously taken on some additional leverage prudently and thoughtfully. So that's been something that we've done. Actually, Justin was Treasurer as we did that. So he was involved intimately in that. And so our structure right now, we're working on paying down as we suggested in the deal announcement of Horizon about $10 billion or so of debt between the closing and the end of 2025 to return the company to leverage levels in terms of EBITDA to debt ratios similar to what it was before the announcement of the transaction. So we're focused on that right now. So the capital structure, we maintained our credit ratings with Moody's and well, S&P, we came down the BBB+ but that's equivalent to where we're at with Moody's BAA1. So we're pleased with that. We're going to work hard to continue to be tactical and get our deleveraging accomplished. So we feel that we'll be able to do that on time. But turning to capital allocation priorities, which I think BD is a part of. First and foremost, at Amgen, we're going to allocate capital to acquiring and funding the best innovation. And that might be internal, that might be external. Most likely, it's both. So that's first and foremost. Next, we want to invest in our business. We talked about the industry-leading facilities we're finishing in Ohio and North Carolina. That's important to us, and we're glad to do that. I talked in my opening remarks about investing in artificial intelligence in any number of use cases there. So investing in our own businesses is our second capital allocation. Then we return capital to our debt holders now to return ourselves to the leverage levels we were at pre-announcement and then we return capital to shareholders. And as we indicated in connection with the deal announcement, we're going to continue to grow our dividend. And we did that this year in the second quarter, rather, we raised our dividend 10% year-over-year. So we'll continue to grow the dividend. And we talk about opportunistic share repurchases. But right now until 2025, we're being extra thoughtful about that. We gave guidance this year that we thought we wouldn't acquire any more than $500 million of our shares in the market. We've not acquired anything through the end of the second quarter as you saw with our 10-Q. So we're on track there. So that's our capital allocation hierarchy, and that's our capital structure. And with that, I think we're running up against time, and I would just thank you, Juliette, and I thank Citi. We'd like to say too that we're grateful that Citi was the lead bank in raising our debt or our ability to close the acquisition of Horizon and early in the fourth quarter. Again, Horizon being a great strategic fit, and we're grateful for what Citi was able to partner with us and [ do ] with Vio Bank and couple of other banks. But thank you for that. Thank you for having us all here. And we thank our colleagues here and the audience for being with us and their interest in Amgen.

Thank you.

Thanks, Juliette.