Eli Lilly and Company (LLY) Earnings Call Transcript & Summary

Excellent. Thank you all for joining us. Pleasure to have the management team from Lilly join us today. We have Mike from the -- heading the diabetes business. We have Kevin and Sara from the Investor Relations team. And we also have, most importantly, Mike DiFiore from my team as well. So we're all on. Thank you guys for being here. There's a lot to talk about. And I think, Kevin, correct me if I'm wrong, but the goal today was to only talk oncology, correct?

It's going to be a short call.

If you could fill in a little bit -- Mike would love to do Alzheimer's as well, if you have...

Yes, yes. And a little bit of COVID, too, why not.

Fantastic. Listen, thank you, again. And I -- here's what I'm going to do. We will focus specifically on the diabetes business today. And my goal was, if that's okay, to focus both on the commercial and the pipeline side of it because I know there's a huge focus on tirzepatide. And I do want to get to that, maybe not at the very start.

But perhaps maybe start off a little bit on the commercial side, in part because I think there's a fair amount of confusion on it. And I think a lot of people amidst all the COVID noise weren't necessarily paying as much attention. But I just want to make sure we have, a: a, good understanding of it, of all the changes on the commercial side that have been happening; and b, that expectations are at the right place as we head into the new year. So maybe turning it over to you, Mike. Could you just catch us up on the key changes on the commercial side that have been happening, and we can get a little more specific.

Okay. Great. Well, first of all, I appreciate everyone's interest in Lilly Diabetes, and thanks for joining us today. I hope everyone is safe and healthy and keeping their mental health during the COVID crisis. I know it's been a stress in many different ways for different people. So I appreciate you -- your interest in joining us today. I think on the commercial side, obviously, the biggest impact in 2020 has been the COVID pandemic and the impact that it's had on people with type 2 diabetes, type 1 diabetes as well as our providers. And so I think, obviously, that's been the biggest impact. I think it's actually been really healthy for the industry, in particular, Lilly Diabetes, to sit back and say, you know what, I can't physically see a health care professional, we don't have as good of opportunities and methods in order to interact with them digitally or virtually. And so we have quickly transformed and improved our digital marketing skills, our virtual engagements, so that we can better educate health care professionals who -- about our products, whether they can see us infrequently or not see us at all. And I think those capabilities are going to help us as we -- even we emerge from COVID because we've always had people that we can see unlimited or not at all. And I think these new capabilities are going to help us out and help patients out because you want to make sure that no matter who your mom is going to, whether they have a physician that we can see or can't see, that they can learn about everything that clinician needs in order to use our Lilly Diabetes product appropriately.

Got it. So Mike, maybe just getting a little more specific to some of the changes that have been happening of late. So in third quarter, there was a miss on the Trulicity U.S. side and Basaglar U.S. And part of that was some onetime adjustments and part of that was segment mix. But my understanding also is that you guys had to change up the rebates in 2020 to maintain access. And what confuses me is, unless there's a new player entering, why would payers be requiring that necessarily a change in rebates, maybe when it's really just Lilly and no...

Okay. Well, that -- the big dynamic in 2020 that was different than previous years is really just kind of this onetime adjustment that we talked about in Q3 that really drove the pricing mix on Trulicity for Q3. And this was really just with the COVID impact and trying to time when the Part D coverage gap expenses would hit. We got it wrong and more hit in Q3 than we expected, so we had to do some prior true-up. So that was the real change. The paying rebates to maintain access is not a new phenomenon in 2020. I think the only thing you've seen kind of that's been unique over the last 2 to 3 years is that you've seen consolidation in the PBM space or PBMs buying insurance companies. So when that happens, if a big PBM buys a smaller PBM, then typically, the smaller PBMs don't have as good a rebate rates. And so when a big PBM buys them, then you have rate harmonization and those prescriptions of people who are getting the lower rebates are now getting the higher rebates. And so that seems like it's a higher rebate to maintain access, but it was really more of a -- due to consolidation that you see in the payer space. I think from an access perspective, we have great access, over 90%, for Trulicity and Jardiance. We're blessed to have leading market share products in the 2 fastest categories within diabetes. So we're very excited about where we are commercially. We're also excited that both products have really important new indications, the HFrEF indication for Jardiance that should launch sometime in next year as well as the recently approved indications for Trulicity, both the CV indication as well as the high dose, the 3 and 4.5 milligram doses of Trulicity. So we're happy where we are both from access perspective and the overall volume performance.

Got it. The segment mix numbers we saw, there was a very clear disclosure on the slides on how the segment mix has changed from 1Q '19 to 3Q '20 and -- which was having a pricing impact of mid- to high single digits, basically, that mix change. My question is, should we expect to continue to see more of that? Or do you think that's the new norm now?

You're going to see some of this. I mean the natural progression of product is that you gain access in commercial first, which tends to be your higher-priced segments, then Part D and then Medicaid. And so you tend to get those lower-priced segments later in your product life cycle. And so over time, you kind of see this mix impact. What Trulicity is experiencing is not different than what you'd see on any product at this point in the life cycle. So there are kind of 2 factors that can play into segment mix. One is your share of market and then one is what segment is growing faster than the other segments. And so what we've seen is that our -- because we picked up Medicaid later access than we did the commercial and Part D, that our share in the Medicaid is lower than what it is in commercial and Part D. If you look at commercial and Part D, we're at about mid-40s share of market. We're at 38% in Medicaid. We picked up 4.7 share points in the first 8 months in Medicaid in the U.S. And so you can think that we're going to catch up and have similar share of markets in, probably by the end of next year. Also, you've seen COVID, you have seen some volume switch from commercial to Medicaid as, unfortunately, people -- unemployment has increased as a part of COVID. And so that's had a minor impact, but it has an impact on segment mix.

So it sounds like there might be a little more of an adverse mix effect into '21? Not dramatic, but a little more.

Well, I mean, I think what we gave, the guidance we gave in our Q3 earnings call was to expect kind of high single digits impact in 2021 for Trulicity. And I think that's the...

High single digit price impact?

Yes.

Got it. Makes sense. Into '21. Okay. That's super helpful. Okay. And then while we're at it, one more thing is there's been executive orders, some post-election. And I don't think folks have really started to get a handle of whether they do or don't mean anything, practically speaking. So I'd be curious, Mike, what do you hear on this topic.

Yes. We think the Part D rebate reform would be the most likely of the 2 proposals to actually make it to the marketplace and would have the bigger impact on patients in America. If rebates reform occurred in Part D, which meant that the patients would benefit from the net price versus the list price as they go through the different phases in Part D, that would be good for patients. And if you look at what I think is one of the biggest issues in U.S. health care is really insurance design. We have about 10% or 15% of the cost in health care, which is really chronic medications, that can prevent the medical costs, the other 80%, 90%, that is medical cost to deliver better outcomes. We want to make sure those are affordable for patients. That's best for the patients. That's best for good quality outcomes. And it's best for, I think, overall health care cost. So I think anything that really works to drive chronic medication out of pockets lower is really good for America, really good for people living with a chronic disease. When you look at the potential of within -- to look at anything that looks outside the country to set pricing levels, I think that's just bad policy. I think -- especially in Part D for medications like cancer, I think you want to make sure there's good incentive to fight just horrific diseases like cancer. So we think innovation should be rewarded. And there's obviously a tremendous unmet need in disease states like cancer. So we're not obviously for that.

How much net price impact to Lilly portfolio could there be from a Part D reform?

I think you're going to see it more on the patient side than you would see on a net price side.

Really?

Yes.

Interesting. So this is -- okay. So when you say Part D reform is most relevant, you're saying from a patient perspective, less so from a...

Yes. I don't think you're going to see anything dramatic at our level. I think what you're going to see is an impact on the patients and the copays that they pay for the chronic medications.

Very interesting. Got it. And you wouldn't feel necessarily compelled to step in with copay assistance?

We'll evaluate that. It's -- that part of it was new and unexpected. So we'll evaluate that piece.

And my last commercial question is a quick one liner. We always repeatedly in the last few months hear about insulins and affordability and then Lilly launched some initiatives as well. Could you just catch us up on the genesis behind that and where we stand now?

Yes. I mean, basically, in January 1 -- we've been working for the last couple of years to close all the gaps in the system, those who are uninsured, those who are in high deductible plans in commercial and those that are in Part D, those are the segments paying more for chronic drugs like insulin. And so insulin-taking patients need to take their medication and be able to afford the medications. So we put them in targeted plans in order to fill those 3 gaps. And so with our Insulin Value Program, where we've capped out-of-pocket expenditures for commercial and uninsured at $35 and our work with CMS on the senior savings model that caps the out-of-pocket for insulin and these demo programs across every phase of Part D at $35, by next January 1, a month from today, no one should have to pay more than $35 per month for the Lilly insulin. So I think it's -- it really closes the gaps and really provides everyone affordable insulin.

And does it change anything from a net perspective for you guys?

On the margins.

On the margin. Okay. Sorry. I'll turn it over to Mike from here. Mike?

Yes. Obviously, I guess, before we kind of jump into tirzepatide, just a broader overview of the GLP class growth. Obviously, IMS trends suggest it's been growing at a healthy 25%. Is the low-hanging fruit still that first injectable, which, I think you said, represents roughly half of insulin patients, or I think before, in the past, it was, I guess, 2/3, but now it's half of insulin patients or patients who are destined to go on an injectable. Is that the low-hanging fruit? Or how much more runway do we have there?

Good question. Appreciate the opportunity to speak about it. We -- that's how we position Trulicity. It was very much, we thought, for primary care, in particular, that this would be a much better first injectable product for someone with type 2 diabetes. When we launched, only 1 out of 10 people going on a GL -- going on a first injection was going on a GLP-1. Now if you look at TRx, that's up to like 38%, 39%. For new starts, that's up to about 45%, a little bit higher. And so I think for us, we do still see really good growth there. Now even though we talk about that quite a bit, 40%, 45% of our use is in combination with basal insulin. And so that's a really powerful product of -- or a combination of having a GLP and a little bit of a basal insulin on board. And so we do -- we still see really good growth opportunities for the GLP class.

Got you. Okay. That's very helpful. And now just transitioning over to tirzepatide. Obviously, front and center, we're waiting a big Phase III readout anytime this quarter. But assuming approval, like how do you see Lilly transitioning patients over to tirzepatide, if there's going to be any of that? And how much -- how would that ramp look like?

Yes. I mean it's going to happen. I mean -- but know that I think companies have made a mistake. And it's not our essence to think very internally about how we're going to convert patients from Trulicity over to tirzepatide. We don't own those patients. What we do is we make sure we educate physicians on how our products can be used effectively to provide good care, and then they'll make the decision. And what we assume will happen is, when you look at our Phase IIb study results, I mean, 21% of people who are on 10 milligrams of tirzepatide reached normal A1c of 5.7, 43% of those on 15 milligram of tirzepatide reached normal A1c of 5.7, while only 2% on Trulicity. And so we see tirzepatide as a more foundational product that can provide not just A1c benefit, but also a weight benefit and that weight benefit can help CV markers, can help NASH. And so we see this as a new class of products. It's more of a foundational product that can not only assist the A1c lowering but also the total metabolic health of someone living with type 2 diabetes because they have much more going on than just A1c. And so our focus is going to be positioning. It's kind of bolder than just transitioning patients from Trulicity to tirzepatide, but really how can health care professionals, how can patients best benefit from tirzepatide. And I think that's more as a foundational treatment. I think in positioning it that way, you're going to get the normal decisions where someone who's going to decide, okay, it's time to start a dual agonist or Trulicity, well, I'm going to try tirzepatide over Trulicity. And you're going to have people who have maxed out on the benefit that Trulicity can provide, and they're going to be transitioned over to tirzepatide. But our focus is going to be very much how can we maximize the opportunity, the impact that tirzepatide can have on the marketplace, on health care professionals and people living with diabetes.

Got it. Very helpful. Very helpful. Umer, do you have any questions?

Yes. Let me jump in then. And Mike, one thing I felt was that in some ways, SUSTAIN FORTE from Novo Nordisk might have been the best case outcome for you guys from a competitive perspective because there was an expectation, weight loss could have tracked higher in that trial. I'm curious how you guys look at that from a competitive perspective, the data set.

Yes. I mean, we weren't surprised. I mean, yes, I think you're right. I think it did have a modest improvement in 2.0 over 1.0. We're not surprised. I mean we came to that conclusion years ago that you can only get so much benefit on A1c and weight by pushing the dose on a GLP. It's important to have these high-dose GLPs, but there is more that can be achieved by going after a dual agonist. And that's why we, many years ago, decided to really focus on GIP/GLP combinations because we thought they would outperform a high-dose GLP. So we're not surprised at all. I mean that's why we've researched and are developing tirzepatide.

Got it. Okay. Is it fair to assume that on your upcoming first Phase III for tirzepatide, which is SURPASS-1, that A1c should be a little less than what we saw on Phase IIb, mainly because there's no metformin background. Is that a fair conclusion? By the way, Kevin, I love those slides you put together.

Thank you. Kevin can take a bow for those. Now, the -- I think it's fair that you're going to see our SURPASS-1 won't be the same as AWARD-11, I think probably SUSTAIN 1 given the patient profile. And when you look at the impact of kind of the course of treatment, where -- how long someone has been a diabetic, the BMI or the weight of the patient or the A1c at that point of kind of the starting point, all that really will slightly adjust the A1c drop or the weight drop. When we're designing a Phase III study for a type 2 [ drug ] like tirzepatide, we're not trying to go in and say, hey, how can we design a study that's going to show the biggest weight loss and the biggest A1c drop. What we try to do, and if you look the totality of our Phase III program, is you have this continuum of care within type 2 diabetes where someone gets diagnosed, let's say, mid-40s, they go on diet and exercise. That fails, then you go on to metformin. That fails, you need something else, you go on orals, then you go on GLP, then you go on insulin, all that. So if you look at our Phase III clinical trial program, what we have to do is we had to educate physicians on what our product can do at all parts of the continuum. So the SURPASS-1 is very much focused on, okay, those patients who are going to fail on diet and exercise, haven't been on oral in the last 3 months, how has our product performed there. Then we have other trials that look at failures on oral. That kind of first injection space as well, will add on to basal insulin. And so I think in totality, you're going to see some variation in A1c drop. You're going to see some variation in weight loss given the kind of the -- those dynamics of what their starting A1c was, their starting weight, whether they had additional background treatments on and how long they've been diabetic. So that's normal. You see that variation in any Phase III program. But we are quite excited to see SURPASS-1 as well as the rest of the SURPASS program. I think what's different about the tirzepatide data is really what I talked about earlier, is the ability to return patients to normal A1c level, 21% in the 10 milligram, 43% of the 15 milligram. No other product that I've seen and I've been exposed to ever even had the opportunity to talk about those rates. And so that's where I think the real difference in tirzepatide, is the ability to really achieve your normal glucose for many patients. So I can't wait to see the SURPASS-1 results.

Got it. But just -- sorry, Mike. And just to sort of conclude on that point. Because of no metformin, so we should expect a little less A1c than Phase II.

We're going to see the results very shortly. So I can't wait to see the results. But you're going to see some variation based on -- if you have the exact same patient population, one didn't have metformin and one did, I mean, you would expect to see more drop with the metformin patients than the...

Got it. And Mike, what do we see with -- on weight loss in general on GLP trials when the starting weight -- baseline weight is a little less?

Yes, you see some impact...

Is the magnitude lesser because of that, obviously?

Yes. I mean if you were -- if you controlled every other variable and you just had starting patients that were -- had -- one had lower weight than higher weight, you will likely see higher absolute weight loss with the higher baseline weight patients than the lower baseline weight patients.

Got it. So from your perspective internally, as you guys are thinking about sort of -- because inevitably, irrespective of how it's communicated to the Street, I got to believe internally you guys are going to evaluate, did it really get there versus the internal expectations? Do you guys do that on a percentage basis or absolute basis? Like I'm just curious how you guys think about that.

You say percent, you mean the A1c loss...

Percentage weight loss for the 10 dose, for the 15 dose relative to the trial. Like how do you guys do that comparison internally?

Yes. I mean we'll look at -- just like anyone else did, we take a look at the A1c and the weight loss base versus what we would expect. And we'll make that determination. We are very confident, and we're very excited to see the tirzepatide data.

Got it. How important is SURPASS-2? At least in our opinion, that seems like perhaps one of the more important trials from a competition perspective, just having that head-to-head in place. I'm curious how important is that to you guys? And also could you remind us how you're thinking about an efficacy delta in that trial in the context of having seen an active comparator versus Trulicity, albeit low dose, in your Phase II trial?

Yes. I mean, as I said earlier, I mean we designed the trial to provide education, to make sure physicians have what they need to treat patients no matter where they're at in the diabetes continuum of care. They're all important. Obviously, I think SURPASS-2 is going to get a lot of attention because it's head-to-head versus semaglutide. Physicians love that. They want to see -- the thing that informs them best is when you do head-to-head trials versus other products. And so I think they're going to -- that's going to be important to really say how tirzepatide, how that GIP component can provide additional value over the GLP. So we're very confident in that and how tirzepatide is going to perform in that study.

Got it. Okay. And do you know what the median dose of sema is in that study?

It's 1.0. That was the only thing that was on the market. So you have to be able [indiscernible] study 2 investigational drugs at the same time.

Got it. Mike, anything we missed? Do you want to touch upon tolerability maybe?

Yes. I was going to say, the bigger picture, I think one of the key concerns about tirzepatide is whether they'll be able to tolerate it. And obviously, Phase III has like a 24-, 26-week long titration schedule, which in the clinical trial world may work, but I guess a big concern at least that I've been getting from investors is, how realistic is this going to be in the real world. I mean -- so I guess my question is, what have you been hearing from KOLs and doctors anecdotally on the practicality or even doability of the titration in the real world?

We haven't heard anything. I think you're actually going to see a different environment in the real world than you see in the clinical trial. In the clinical trial setting, we have 3 arms. We have 3 dosing arms. And so you have to titrate up very rapidly to the highest dose, so you can test and see how 5 does against 10 versus 15. In type 2 diabetes, what's going to happen and what people do is they titrate up to the -- they have the starting dose, they titrate up to the first efficacious dose and then they stop and see how the patient experience is. And that patient, if they're performing well, they'll stay on that dose for months or a year or 2 until they need something else, and then they'll titrate up to the next dose. And they'll stay there until something else and then continue to the next dose. What we've seen with the AWARD program and the additional doses for Trulicity is that physicians love the ability to be able to have dose escalation flexibility. They don't see it as complexity. They see it as, no, I like to have the ability that if like someone does need more A1c support or they do need more weight loss, I have the ability to do that. It's always much easier to escalate a dose and keep them on treatment than it is to switch to a new product. So everything we've heard from clinicians is that they like the dosing flexibility.

Got it. Got it.

Sorry, Mike. If I may, just very quickly. Do you think the time spent on the fully titrated dose would have relevance from an efficacy perspective? And I asked because of the late titration in the trial.

Yes. I mean our Phase III programs are going to be longer than our Phase IIb program. I'm interested to see how weight does in our longer studies. These will be at 26 weeks in Phase IIb studies, we hadn't seen the weight loss plateau. And so I am excited to see what the weight profile will be on our longer Phase III studies.

Got it. Mike, the last one I have is really -- on tirzepatide topic is really around, the sense I get is, everyone seems to agree that there could be a real scope for tirzepatide in obesity as well as NASH, but it seems like the time lines for having more definitive readouts are -- we're still some time away from those. So could you just catch us up on where we stand and why it takes a bit longer on those indications versus diabetes?

Right. Can you guys hear me?

Yes, we can hear you, Mike.

Okay. I lost my signal and had to rejoin. So I think...

No, no problem. I was just asking timing of obesity and NASH and why that's a little more delayed than diabetes.

Okay. Yes, we started those programs later. And so we started our tirzepatide obesity trial in 2019. We started the obesity trial recently -- or the NASH. So we're a little bit farther behind in the obesity and NASH programs [ by this time ].

Okay. All right. Well, were there any investor questions you wanted to flag, Mike, before we move on from tirzepatide?

Just one question that I have been getting from investors. I mean since -- and you mentioned this before, Mike, the whole concept of diabetes is to kind of chase the disease creep. Patients get worse, they need more -- I guess more effective drugs. What's to stop -- I guess, what -- why would a patient, I guess, go to a lower dose or be on a lower dose of tirzepatide rather than a high-dose GLP-1? I mean if -- where I'm getting that is that like 10 milligram of tirzepatide seems efficacious wise kind of in the same ballpark as a regular high-dose GLP. What would the added benefit of tirzepatide be if they were just on like a 10-milligram dose rather than the 15-milligram dose where we see the biggest benefit?

Well I mean, I think the clinical inertia that's in the market right now is people like to use the lowest dose that works on a patient. And so I think they'll try someone on 5 milligrams. If that works, they'll keep them there. If you compare the efficacy of, and I've talked about this data early in the call, but I don't think the 10-milligram efficacy is similar to what you see on Trulicity. When you see in the Phase IIb program, we saw 20% -- 21% of patients return to normal on 10 milligrams of tirzepatide, we saw only 2% on Trulicity. And so we do think the GIP component is providing additional benefits for A1c, for weight, for cardiovascular markers. And so we'll have to see what the data shows, but no, we're very confident in that. And so at the end of the day, clinicians will make the best decision for what that individual patient needs. Some may need to titrate up to 10 milligrams, some may not.

Got it. Very helpful. Just more on the pipeline. I noticed that you have a -- Lilly has an oral GIP/GLP in the works. I think it's in Phase I. Could you maybe add some color on that in terms of what, I guess, what the intentions are for that product? Is it just simply kind of a life cycle management play? Or if you could speak to that a little bit, that would be helpful.

Yes. I mean we're excited about the concept of an oral product that has similar efficacy as tirzepatide. Imagine, we believe that would be a good need in the marketplace across all 3 potential indications. And so that program is a peptide program where we're looking to put a GIP/GLP co-agonist in an oral formulation. It's still early. It's in Phase I or getting ready to come into Phase I. And so we're excited about the potential of what that product could be. But that's the concept is, just think about tirzepatide level of efficacy in an oral formulation.

Got it. Maybe a quick one for Kevin. Kevin, should we expect readouts as they come due for various tirzepatide trials going forward from here?

Do you mean like top line press releases for like SURPASS-2?

Yes.

Yes, absolutely. These are -- our Phase III programs, the big Phase III programs, we get the data management reviews very shortly thereafter, it's material data. Our policy is going to do top line press releases. So as you get into 2021, we continue, you'll have the next 4 top line press releases for SURPASS-2 through 5 as we get them.

Got it. Mike, from your perspective, what's the most important diabetes pipeline program beyond tirzepatide.

There are so many to choose from.

I know.

That's amazing. No, I think the 2 that -- I won't play by the rule, I'll actually talk about 2 of them. I think on the incretins side, the triagonist is very exciting. I think the level of weight loss that we saw with GLP, GIP and then Glucagon, it's really kind of breakthrough weight loss, even greater than what we saw on tirzepatide. So we're excited about that program. It's in Phase I now. And then on the insulin side, our weekly basal insulin is a product that we're quite excited about. We're -- it's in Phase II studies. We've completed 1 study. Now we have 2 additional ones, one in type 2 diabetes for naive patients and one in type 1 diabetes. When you look at basal insulin, what's really important is that kind of peak to trough. So you want as flat of an insulin as possible because if you have one that kind of peaks and has a pretty big difference between the greatest insulin effect and the lowest insulin effect in a day, that's what tends to cause hypos. And so when you look at the -- kind of the gold standard on the marketplace right now, which is degludec, it has a peak to trough ratio of 1.5. Our weekly basal -- and that's for a daily product. For weekly basal insulin, for ours, it has a peak to trough of 1.14, which is much flatter, and we think can help physicians provide a tool that not only provides convenience for the patient, especially those beginning insulin treatment, but also be able to get good efficacy while avoiding hypo. So we're excited about the potential of that product.

And what's that peak to trough for the Novo Nordisk weekly basal?

It was 1.4. Don't quote me on that, but I think it wasn't...

Even -- so this weekly basal you guys have could be best-in-class on weekly basal category?

We think from a peak to trough perspective, which is so critical, yes, we think we have the best-in-class product.

That's interesting. Do you see this, Mike, as a product that could approach Trulicity in size if you really have a weekly basal? Or is market for the pricing has been destroyed?

Well, you're like -- the price point isn't going to be as high as what an incretin would be. But we do think that physicians, payers will see the value in a weekly formulation. I mean you look at, unfortunately, the acceptance rate of someone going on insulin is just so low. You get down to where you have like 1 out of 3, 1 out of 4 patients that are still on a basal insulin by the second prescription. That's because people just don't like going on to insulin. They -- it's hard to take, it's complex. So anything that can reduce that burden on patients will drive more acceptance of the treatment and better total outcomes. So those patients who are going on basal insulin, they really need to be on insulin at that point in the [indiscernible] type 2 diabetes [indiscernible] when they don't continue on treatment.

Got it. I noticed, Mike, you haven't mentioned the oral GLP, the Chugai molecule. Where do you guys stand on that? Isn't there a meaningful readout next year on that one?

Yes. You will see the first results next year on that. We're very excited about the potential that product has. That's a small molecule. And so think about that as an ability to provide similar efficacy of what we see with GLP or like Rybelsus without some of the food effects that you see, the limitations of dosing that you see with Rybelsus. So we're excited about that. We think that will improve bioavailability. So it will be less COPs. And so we're excited about the potential of that product.

Fantastic. Anything we missed? Mike, anything on your end?

No, just to maybe backtrack a little bit, just on basal insulin. For Basaglar, I -- just monitoring IMS trends, TRx trends, it looks like it's -- the trends are on the downswing right now. And I just kind of wanted to know how much of that is due to just the pricing dynamics that we've spoken about before or the, I guess, launch of Semglee, biosimilar competition. Do you see that being much of a threat? Or having much of an uptake?

Okay. Can you hear me okay? I think my WiFi is going out again. Okay. So Basaglar, we have seen a little bit of leveling off of Basaglar. That was just due to access. We lost some Medicaid states, and we lost UnitedHealthCare. So we see kind of more kind of flat sales as we go forward into 2021 with Basaglar. We haven't seen Semglee have any impact in the marketplace. You still need access from a payer, and they haven't yet secured access with a payer, so we don't anticipate that to be an event that's going to happen in 2021 that's going to really change the results on Basaglar.

Got you. That's helpful. And I guess one more pipeline question for me. I feel this doesn't really get any play or any discussion. Just oxyntomodulin, if you could just explain what exactly that is? What data have you seen to date? And how that could fit in the treatment algorithm, that’d be great because I feel like, again, this is never talked about.

Yes. It's a disease that we have and we have such rich pipelines and some of our products don't get talked about. But...

Good problem to have by the way.

It's a good problem to have, yes. That's -- we started to look at different kind of incretin combinations. That's a combination of a GLP and a glucagon pharmacology. And the pharmacology for glucagon, we hypothesized, would have even more sustained weight loss than a GLP alone and may have some benefits for -- in the liver and for NASH. And so we really have 2 plays in there. One is oxyntomodulin, which is a GLP and a glucagon; and then our triagonist. And so both are in kind of Phase I programs right now. We'll get the results next year and kind of make a decision going forward. We have 2 important shots on goal that really kind of look at the ability to combine glucagon with GLP or GLP and a GIP. We also partnered with Innovent for the -- for oxyntomodulin in China which I think is a big opportunity for us. So we initiated a Phase Ib/IIa study this year in China for obese patients. So very excited about the potential and really kind of test to see what glucagon can bring on top of the GLP or on top of tirzepatide.

I see.

Excellent. Well, listen, I know we're approaching time, so I want to be very respectful of your time as well. But thank you again for making time, and look forward to seeing everyone.

Yes, thank you.

All right. Always good to see you.

Likewise.

Be safe.

Thank you.

Thanks. Bye.