Novo Nordisk A/S (NOVOB) Earnings Call Transcript & Summary

Good morning, good afternoon, everybody. Welcome to this session. We have Kristoffer Berg with us from Novo Nordisk. We will go through 10, 15 minutes of prepared remarks, and we will then go into Q&A. If you have questions, you can submit them. We will see them on the screen, or I will see them on the screen. I can field them that way. And if there aren't any, then I will go ahead and ask questions myself. Without further ado, Kristoffer, over to you.

Thank you very much, Michael. And thank you, everybody, for the interest in Novo Nordisk and for dialing in today. It's, obviously, a different way to conduct a conference, but, I guess, this is the new world we all have to adapt to, and so are we at Novo Nordisk. And as you probably saw, we released our Q1 financial results 2 weeks ago. And they were, obviously, also impacted by COVID-19, in a sense, in a positive way, because there was a lot of stocking. So what we've reported in terms of sales and profit was inflated due to COVID-19. So we delivered 14% sales growth, but if you adjust for the COVID-19 stocking, the underlying growth was around 7% sales growth. If you look at the bottom line, it was around 4%. So obviously, there is a small spread here. We also anticipated that, as we view 2020, to be a big investment year for Novo Nordisk, in the sense that we are launching a set of new products. So obviously, Rybelsus in the U.S., but also the continued rollout in Europe, in the rest of the year. We also continued the rollout of Ozempic in international operations. We have also ramped up our efforts in China. So since January this year, we have Tresiba nationally reimbursed in China. We also hired some more sales reps to promote that product. Obviously, in the first couple of months of this year in China, they couldn't hit the ground. But anyway, we view 2020 to be an exciting year in terms of the rollout of new products. So if I just go through some of the highlights for the first quarter of this year, and then I'll open up for Q&A afterwards, and Michael, it would be great if you moderate that. So as you probably know, we introduced you to the strategic aspirations last year in connection with our Capital Markets Day. They're based on these 4 quadrants. So the one is purpose and sustainability. So one of the key aspects that we've launched in the beginning of this year is a set of US affordability offerings. So both a follow-on brand of insulin, a cap for people who are paying out-of-pocket, for people who are not really covered with an insurance, and also some emergency insulin. We actually even expanded this during this very uncertain time of COVID-19. So people who have been laid off due to coronavirus and have lost their job, and thereby, also to some extent their coverage, we are actually providing free insulin for up to 3 months. And then afterwards, we'll help people to get on the proper program to make sure that they had access to affordable medicine going forward. We also have done various societal contributions during the COVID-19 pandemic. So we have actually been working with various governments in order to distribute tests for coronavirus to distribute disinfection. So we have quite large production sites. And through that, we have had some excess ethanol that we've actually been able to distribute as hand sanitizer. And in various ways, we're working with societies to get through this very difficult time for all of us. From a production standpoint, we have been able to now get 100% of our power running at our production sites from renewable sources so that we're also quite proud of. If I move on to another strategic aspiration, that's the innovation and therapeutic focus. Then, Rybelsus received approval for the treatment of type 2 diabetes in the EU and the U.K., previous to this year. Ozempic marketing authorization has been submitted -- that application in China. And then as you probably saw, concizumab Phase III clinical trials have been paused due to some thrombotic events. So right now, we're assessing whether we can actually continue with that at a later stage this year, that trial. I would also highlight that we have presented with you the top line Phase II results from semaglutide in NASH, and I'm sure we can cover that in more detail later in the call, during the Q&A. And as you also saw, actually, after we announced the Q1 results, we have also released the top line results from the first STEP trial. So 1 out of 4 trials in the STEP program, which is the semaglutide Phase III in obesity program. So quite exciting times here also in terms of that. In general, COVID-19 is impacting our R&D efforts, in the sense that we are not initiating new trials. And it's also a little more difficult to recruit patients for ongoing trials. However, we're in the unfortunate situation that some of the key readouts for 2020, that would be semaglutide in NASH Phase II, it's the obesity trial with semaglutide. It's the amylin trial. Those had already gone into a quite late-stage in the development. So we were not affected by COVID-19. We can live up to the time lines already presented to you. So during the next couple of weeks, we'll have an interesting set of readouts, both when it comes to continued trials in the obesity STEP program, but also the amylin analog, we will also have the Phase II trial readout for that. In terms of production, we are able to deliver across the value chain and across geographies, although COVID-19 had impacted, in the beginning, our production, but we're now running at high capacity in all production sites across the world. Commercially, I would say that we have been impacted a bit by COVID-19. So you can say, patients are not seeing doctors to the same degree as what they used to before this coronavirus outbreak. And our sales reps and medical reps, they're not able to visit doctors to the same degree as before as well. So we're mitigating this, like everybody else in the industry, by using virtual interactions. And to that, I think everybody has stepped up their efforts, be that both doctors and patients, who are also calling into doctors via virtual channels. But there is no doubt that this is potentially affecting some of the newer products that have been recently launched. So Rybelsus, although having started out in a very encouraging way, with a great uptake, on par with some of the best diabetes launches throughout times, then we are seeing a slowdown in NBRx, so new scripts. But that's to be -- it's probably to be anticipated in a time of uncertainty. If I move on to one of the other commercial -- sorry, strategic aspirations, that would be the commercial execution. Here, we're doing quite well. So our diabetes sales increased by 13% in the first quarter, and our value market share has been expanded. So we've expanded our leadership by 0.7 percentage points to 28.7, which is actually quite meaningful. So you can say, I think it's always good to measure your own performance against the market. And if you are performing in competition, that means that your performance, everything else, in relative terms, is quite good. Much of our good performance is driven by GLP-1. That's both in North America and international operations. Obviously, the instant franchise is going through very different stages. If you look at the U.S., where you have quite severe price pressure, that has not been a secret for a long time. I think that's quite obvious to everyone. However, in international operations, the insulin franchise is doing quite well and taking up a big proportion of growth. Our biopharm sales also increased by 16%, driven by key products, being Novotropin, NovoEight and Refixia. NovoSeven is also holding up quite well despite the intensified competition from Roche's good product, HEMLIBRA. So that leaves us with our last strategic aspiration, the financial component of that. And I think I already started out giving you the hard card numbers for the first quarter, obviously, being inflated by COVID-19 and some stocking impact. But still the underlying performance of 7% is very encouraging. And that also leaves us with the guidance for the full year that we maintained. So 3% to 6% on top line growth, 1% to 5% on operating profit, both at constant exchange rates. So I think with that, Michael, I will open up for questions. And we can take it from there, whatever topic you want to dive into.

Okay. Fantastic. So I'll take the first one that's come in. This one is going to be quite fun. The question is, do you invest? Or are you interested in primary care and prevention technology platforms focused on behavioral change backed with artificial intelligence?

That's the first one that I get that question. I think we all, in these times, are looking into new ways of doing our normal business. I don't think, even on the other side of COVID-19, that normal will take the exact same shape as pre-COVID-19. So obviously, we're also looking into whether we can use virtual interactions more often, whether AI is also something we can integrate more so than what we're doing now. In terms of PCPs, they are the ones who tend to have less time with our patients as opposed to endocrinologists when you're talking diabetes treatment, obviously, because they're seeing so many different types of patients that they don't have the same in-depth both typically experience and knowledge, as an endo has and time with their patients for that matter. So I don't know if AI is more specifically related to PCPs. But I think across, not only commercial execution, but in general, we are using AI much more than what we did just a couple of years ago. We've also been able to implement artificial intelligence in our R&D organization. So you can, in many ways, be more efficient with how you conduct clinical trials, and also how you design your clinical trials. And for that matter, run various simulations in the very early stage of research to get to the best molecule composition. So there are a lot of interesting aspects to AI and to digital health, in general, as we look forward. And I think COVID-19 will only probably emphasize the importance of adapting to new technologies and opportunities that they come with.

Okay. Great. And maybe as for my own follow-up in here. One thing that's sort of actively debated in that spirit is continuous blood glucose monitoring. From your perspective, is that a variable in the way you think about your business? Does that change anything? Or is that more peripheral?

No, I wouldn't say that it's changing our underlying business at all. I think it's quite exciting to see what is happening in terms of development in the digital health space, both for CGMs and also various, you can say, apps, and the way there is a whole ecosystem between your continuous blood glucose monitoring system, your smartphone, or whatever device you're using, and then also medicine. And in a sense, all these are becoming smarter. We're also chipping into this, say, value chain with connected devices. So think about a patient who has continuous blood glucose monitoring device, maybe on your arm, if you're using a FreeStyle Libre from Abbott or a Dexcom or whatever, Medtronic, whatever you have out there, they're all very good. We have teamed up with all of them basically. We have this nonexclusive partnership approach. So we have also, at Novo Nordisk, probably recognized that we should not be driving the device development going forward, but we're teaming up with the best in the industry to still continue to deliver medicine because insulin, which is typically what's used in these CGM systems, that is still needed. But the way you use insulin is typically optimized. So if you have your CGM, you have maybe a device that has a memory function to keep track of how many units of insulin have you been taking, and combine the CGM with the device monitoring how many units you've been taking with an app. So all that combines different data inputs to see how well in control you are. And with those data inputs, you can, in theory, get to a much better control. And sometimes, you also -- you actually use more insulin. So we actually -- we did a pilot study in Sweden a couple of years ago, where we could see that people who were using CGM and a device where you had a good memory function, they tended to use a little more insulin because they could, with more precision, monitor how good in control they were. And that means that you ended up in the range. That's typically the HbA1c level, where you want to be at the glucose level, that where you want to be 2 hours more during the day, as opposed to those people who did not have all these digital enhancement methods. So there are a couple of takeaways from this, and that is that patients, they get more comfortable using insulin because, as you probably know, the biggest fear for people who are using insulin is to take too much insulin, and thereby reducing your blood sugar level, and that can lead to fatal cases of hypoglycemia. So people tend to use a little -- too little insulin actually. Meaning that they're not in the best or optimal long-term control. So I think with CGMs, with better connected devices, with various apps to bring together all these data inputs, then I think we can all benefit, be that patients and manufacturers, because maybe there is also need for more insulin at CGM manufacturers. So -- and for that matter, also payers, because people will get in better control with all these enhanced methods. So that also means, in the long term, fewer complications to deal with. So quite exciting what's going on in the digital health space. I think there're still a lot of steps to be taken on that journey, and I think we're only in the beginning of that journey. But as I said, we're taking this nonexclusive partnership approach and, at Novo Nordisk, we've also ramped up our internal organization within digital health. So I think it's quite exciting what's going to happen in that space going forward.

Okay. Great. I know that was going to be fun and unexpected. The next question that came in is, and this is away from you, because it's not your data, but there was lots of debate around Alzheimer's, liraglutide in the ELAD study. So is there any update when do we know when we should expect that data? Last time, Lars was talking about it, it sounded like it was imminent, but that's quite a while ago?

Yes. It's a little bit of also an open question for us here in Novo Nordisk. I mean, as you know, the ELAD study is an investigator-sponsored trial, run by Imperial College in London. So we have nothing to do with running the trial or collecting the data, of that matter, analyzing the data, and hence, also deciding when and how to publish it. The trial was concluded by the end of last year. So by now, you should expect that they're in the middle of analyzing the data. But I think it's also fair to assume these days, everything is being delayed due to coronavirus. So honestly, I don't know when we can expect more from an ELAD front. But as you also know, the whole discussion around Alzheimer's or mild cognitive impairment, and the prospects for Novo Nordisk, then ELAD is only one piece in the puzzle. So there are various hypotheses that GLP-1 has positive effects in terms of delaying the onset of cognitive disorder. And we've also done our own meta-analysis on some of our cardiovascular outcomes trials, both on LEADER, that was with Victoza or liraglutide, and also SUSTAIN 6 and PIONEER 6 on semaglutide. And here, you do have some small pieces of evidence that there could be a positive effect on Alzheimer's, if you're treated with a GLP-1. That same goes for some of the registry databases that we have, both in the U.S. and Denmark, for people who have been treated with various type 2 diabetes medications. And you can then see, for people who have been treated with GLP-1, there tends to be a lower likelihood for developing cognitive disorders. So of course, we are very far from having something concrete. And I think the ELAD trial will add to the understanding of the whole GLP-1 in Alzheimer's discussion. And I think, at some point, the management here at Novo Nordisk, they will take a decision whether we should do some kind of clinical development ourselves. But the fact is that we don't have anything concrete right now. We need more evidence to make any conclusions, and we haven't put together a clinical program at this point. So we are far away from having something more concrete. So there are a lot of exciting talks about it, and we also think it's exciting. It has been on our R&D strategic radar for a while. Again, if I make a reference to our Capital Markets Day last year, in November, we also had a slide on how we would like to extend into adjacent therapy areas. And I wouldn't necessarily say that Alzheimer's or cognitive disorder is an adjacency that's very close to our core, being diabetes, I think, then, obesity and NASH are more obvious therapeutic areas of choice. But of course, I mean, if we have a promising aspect in GLP-1 or semaglutide in Alzheimer's, we would also look further into it. But I think, at this point, it's still too early to conclude anything, but exciting, no doubt.

Okay. And maybe drilling into that, because you elaborated on it. You -- there's a decision to be made how to -- I'll talk about NASH and obesity in a minute, but there's a decision to be made how to take semaglutide further in the development in NASH. And you've got your obesity program up and running. But, I guess, just sort of questions, where does that go with what combination? And then you do have an opportunity maybe to start something in Alzheimer's, but presumably, that would also require a reasonable amount of funding. So how is the decision made internally? Is it literally, if it's adjacent, it's much easier to make a case for it and something like in Alzheimer's would have to be done with a partner? Or can only be done when all the other stuff is ticked off? How is that decision taken internally?

It's a decision that will be based on basically all of those aspects you just touched upon. So of course, you need to take into consideration what makes most sense to invest our time and resources in, and what kind of approach should we be taking? I mean, we don't have much experience, or no experience at all in the Alzheimer's space. So maybe a partnership approach could be the right way to do it. Now this is only guesswork. So -- but as you also said, in NASH, for instance, we have taken this partnership approach with Gilead Sciences, at least for one Phase II proof-of-concept trial, where we're looking into semaglutide, in combination with Gilead Sciences' FXR agonist ACC inhibitor to see if there are any synergetic effects here. But also, it's a way to learn from one of the leading companies in the liver disease area. Again, something that we don't have much experience in. We have great understanding of the cardiometabolic area. We have a very strong foothold in diabetes and obesity and hemophilia and growth hormone disorder, for that matter, but NASH is still an unchartered territory for basically all companies. I mean, there is no treatment approved at this point in time. But Gilead Sciences, they have good relationships with hepatologists. They know how to basically act in this space. And I think we can learn from them in that regard. And then, we are probably chipping in with one of the most promising molecules in the NASH space, I would dare to say, in semaglutide.

Okay. Great. [Operator Instructions] So there was a lot of discussion about NASH and semaglutide around with your Q1 results, so we'll go into that as well. But the data point that came out after was obviously, the STEP 4 results you referred to in your remarks. I was wondering if you could contextualize for us the trial design, the weight loss over 68 weeks? And how that compares to how you talked about the potential of semaglutide in obesity be before we saw the data?

Right. So just to recap on the trial design. It was, in total, a 68 weeks trial. You had a 20-week run-in period where everybody was put on semaglutide and titrated up to the target dose of 2.4 milligram. And for those patients who had achieved that target dose, they would be continued on the trial and then randomized after that cutoff date of 20 weeks. And then you would have 1 arm continuing on semaglutide 2.4 milligram once weekly, another arm continuing on placebo. So there were a couple of interesting findings here. For one, those who completed the 68 weeks trial, they lost 17.4% of their weight, if you're looking at it at a treatment policy estimate. If you -- if you're using the intended to treat estimate, they actually lost even more, so 18.2%. So that -- those 2 numbers are very high and quite encouraging, and probably also even slightly higher than what we had expected. So that was very encouraging. Another thing I would also point out was that there was a clear difference between the people who, after 20 weeks, continued on semaglutide or for those who continued on placebo. So for those -- so first off, after 20 weeks, you'd lost 10% weight. For those who then continued on semaglutide, they lost an additional 7.9%. But for those who went on placebo, they actually regained 6.9% of the body weight. So that speaks to the fact that it's very important to continue your treatment if you want to sustain a weight loss. The funny thing is, or it's not funny, it was actually designed on purpose. But the 20-week run-in period is, more or less, the same time as the average stay time of Saxenda today in the U.S. So if you can extend the stay time that's currently in the market, you have a very good case for your franchise, but you also have a very good case for getting some better outcomes for patients. Now of course, semaglutide is a more potent drug than liraglutide, which is the molecule in Saxenda, our anti-obesity medication. But it also speaks to the behavioral science of treating obesity. It's not enough just to lose weight. As a matter of fact, you probably know someone who is living with overweight, who tried a diet and exercise scheme and quite quickly lost some pounds, but also quickly regained them. So you're really fighting nature here. If you want to lose weight, there is this set point theory. So if you're overweight and you lose weight, your body will remember sort of the weight it came from, and will do anything it can do to get you back to that level and even build in a small buffer. So it will reduce metabolism and increase appetite. It actually goes back to the stone age when people went into hibernation. And there are many theories for how long it takes for the memory to kind of reset the natural weight. But for sure, it takes more than a year to reset that. So I'm not saying that obesity should be viewed as necessarily a chronic treatment, but at least you want to treat obesity with a long-term approach. And semaglutide that, also on top of working in a very efficient way, continues to shred off weight will also motivate people to continue their treatment and be diligent in terms of their exercise and diet scheme. That, at least, is the intention. So STEP 4 was designed to have this maintaining weight loss approach. I will caution though that you can say, given this design, there might be a small inflation in the weight loss, because we sort of made sure that it was only the people who could tolerate the high dose who continued in the trial. So if you're looking at the total weight loss in this trial, as compared to some of the other STEP trials, and we haven't seen those, they're going to read out within the next weeks, it might be that this is slightly higher. But anyway, we had probably aimed for around 15% weight loss. That's more than double that of Saxenda. So coming off the gate or out of the gate with STEP 4, between 17% and 18% weight loss, that's a very strong start for semaglutide and obesity. And stay tuned for exciting data to come out in the remaining STEP 1 through 3.

Okay. Fantastic. And I guess, you elaborated on the trial design. The dropout, the 10% of patients, I believe it was, that in the first 20 weeks that would not make it to 2.4 milligrams. Is that your standard? While with GLP-1, you get GI tolerability issues and some patients just won't be able to be titrated to that level? Is that the way to think about it?

Yes, I would say so. And then we haven't disclosed the more detailed data on it. But, obviously, there -- as with any trial with GLP-1, you have some patients who are experiencing GI side effects, and thereby dropping out of the treatment. And then for this design, in particular, you also had this cutoff. So if you had not reached that target dose after 20 weeks, you're not allowed to continue on this trial. But in essence, you could still be on treatment. So there were some flexibilities in terms of how you titrate up the doses during those 20 weeks. So it's not necessarily that 10% all dropped out due to adverse events, it could also be that they simply needed a little longer to titrate up to the highest dose. But that was simply not making it for the cutoff date. So yes, I think it's what we had anticipated. There will always be some side effects, but these are very acceptable side effects, I will say.

Okay. And if I look at the percentage of patients -- so the percentage of weight loss at week 20, and I will compare that to the Phase II data that we saw previously, it looks like it's a little bit slower. Tell me if I'm being unfair. But is that just the titration schedule? Is that why the time to get to the 3.4 milligrams was a little bit slow? And as a result of that, at 20 weeks, the 10% weight loss is numerically less than we've seen in Phase II? Or is that the wrong way to think about it?

I think, first off, you need to be cautious about comparing 2 different trials. But I would say that there might be something to the titration that we have figured out in a more sensible way in the Phase III versus, at least, the highest dose in the Phase II program. But I don't think, in any way, that the weight loss seen in this first Phase III is disappointing when put in context versus the Phase II. If you remember, then the total weight loss after 52 weeks in the Phase II, on the highest dose, that was 0.4 milligrams, given once daily, that was 16.2. So here, and you can say 2.4 milligrams taken once weekly, as in the STEP trial, this is slightly lower than the highest dose in the Phase II program. But still getting you to between 17% and 18% weight loss after 68 weeks, I think that's a very good set of results, and we're quite encouraged by that.

Okay. The question -- a follow-up question from the audience here is, you talked about the behavioral change that's required when treating obesity. Outside the pharmacological approach, what kind of support do you provide to drive such behavioral change? That's the question.

Right. I think that's a very valid question, because it's not enough just to have a strong medicine or a molecule that's working in a potent way. You simply need to also have some good supporting offerings. So we have this patient support program, where we basically help patients who are using Saxenda with -- through various channels that could be call centers, it could be text messages to keep memorizing, or to remember people to take their medicine, it would be a suggestion for recipes. In general, just support people when they're going through a period where they're losing weight. That's not always that easy. So a strong patient support program, that is quite good. We have also teamed up with the Noom, this quite popular app, where you also, via Noom, can monitor how many calories are you in taking. What kind of exercise schemes are trending these days? Or what could be customized to you as a patient going through a weight loss period? So we're trying to do these patient support approaches, both with our own Saxenda care program, but also teaming up with Noom, one of the leading apps in the industry. And then, I would say, on top of these behavioral approaches, you also need to do a lot to, basically, just increase awareness of obesity being something that needs chronic treatment. So normally, I refer to the obesity space, or the obstacles in the obesity space, with the 4 Ps. For 1 P, that would be payers. I mean, the reimbursement is very low across almost all markets, where we have launched Saxenda. So Saxenda is now launched in 46 markets. In almost all of these markets, it's actually an out-of-pocket product. So people pay out of their own pocket. In the U.S., in particular, we do have some coverage, but it's only in the commercial channel, where we have around 70% access. But again, here, employers need to opt in to basically reimburse anti-obesity medication. And it's not that many employers who do that. So that leaves us with the fact that actually fewer than 2 out of 5 people have proper access to anti-obesity medication or Saxenda. So that's 1 P. More payers need to understand that obesity is something that you would actually like to treat. And you can convince them with health and economic arguments, because there are a lot of comorbidities that come with obesity. So whether you view obesity as a disease or not, you really can't ignore the pressure it puts on health care budgets. So you would probably rather treat obesity today, then deal with the comorbidities later down the line, being diabetes, or NASH for that matter, or cardiovascular diseases, or just quality of life and productivity by your employee. Another P would be prescribers. So there are no dedicated specialists in obesity, or at least very few. In the diabetes space, you have endocrinologists. In the cardiology space, you have cardiologists. You don't really have any obesitologists, or whatever we should call them, in the obesity space. So that's also something that we need to be part of building. We are seeing more and more obesity clinics around -- in the country of the U.S., but also outside the U.S., but it's still a very, very low percent versus the other doctor specialties. A third P would be patients. So again, many patients, because there are not that many places to go if you have obesity in terms of treatment, they don't really know how to deal with their obesity. And they also feel like it's a self-inflicted lifestyle result. And again, you can debate whether there is some truth to that or not. But if you have reached a point where you're living with obesity, then it's very difficult, even if you want to get rid of excess weight, to actually lose weight. So that's also speaking to the current stay time of Saxenda, for instance, which is around 5 months, which is really too low to maintain a proper weight loss. So we also need to convince patients to stay on their treatment, to seek more help and in general, hold their hand, while they go through this tough period of both losing weight and maintaining that weight loss. Just to put it in context, it's only 2% of people with obesity who are getting treated with an anti-obesity medication. And if you look at the global number for people with obesity, it's 650 million people living worldwide with obesity. And that number is even expected to increase to around 1 billion in the foreseeable future. 2%, again, I repeat, are being treated with anti-obesity medication. So we're just scratching the surface here with Saxenda and some of the other obesity products in the market, but we're really the only larger company promoting the obesity agenda. So that has proven to be a tough, long ride, actually. Then I would say the fourth P, and the last P, is really products, because we need better products in the market. Saxenda has been doing quite well, but it has a weight loss profile of around 5% to 7%. We need to get to a higher benchmark. And I think semaglutide has, obviously, proven that it is the next-generation anti-obesity medication. And if we get to that, say, 15% weight loss with semaglutide in a once a week injection, you have a much more compelling argument when trying to convince both payers and prescribers and patients to stick -- adherent to their treatment, and for that matter, to have the treatment reimbursed, and for doctors also to prescribe anti-obesity medication. So I think we are on the right path. We are in the obesity space for the long haul. We are only scratching the surface. But if you look at our pipeline, we believe that this is certainly a good long-term opportunity for us and also for society to basically tackle one of its biggest health care issues, if you look at it from a long-term perspective. I would also highlight that, on top of the STEP program, we have the SELECT trial running right now. It's a large cardiovascular outcomes trial, including more than 17,000 patients. So one of the largest outcomes trials ever done. And that's basically treating people with obesity on semaglutide 2.4 milligram versus placebo or standard of care for cardiovascular disease. So we'll see here if semaglutide has a positive effect in reducing the risk of cardiovascular diseases in an obesity patient population. And if that is the case, I think we have an even stronger argument for why, again, obesity should be treated today. So as you can hear, there are a lot of inputs going into the whole obesity market. And I could go on for a long time. It's a big interest and passion of mine, but I think I'll leave it here and move on to the next question.

Okay. By the way, we only have a few minutes left. So maybe we can try to tie this together. So you referred to the NASH data that was -- somehow that was widely discussed at the Q1 results. Like you say, good data certainly compared to what's been seen in NASH resolution so far. But my question to you is, how do you think this is going to be developed going forward? And how does this fit into the whole treatment paradigm? Is this a metabolic syndrome question, where it sort of doesn't matter whether a patient is a diabetic, or obese, or NASH? It's sort of like -- it just furthers the potential of the GLP-1 class overall? Or should we think about this as separate indications that each will have their own revenue lines, and it's semaglutide in a different dosing, a dose administration, but it will be separate and be sold as separate units?

I think that's a question we're also asking ourselves and the people that we work with, and even also regulators. So there is no doubt that there's a huge overlap between those therapy areas you just mentioned. So if you look at NASH, then people with NASH, 80% of those, they also have obesity. 40% of people with NASH also have type 2 diabetes. What is the root cause of NASH? Well, in most incidents, it's actually obesity. So you can say the root cause, if you want to go for the root cause, that's probably obesity. Then you can debate for people who are then in that quite severe situation that they have, late-stage developed NASH, they need some treatment for that. And then I think from a reimbursement standpoint, it might be more concrete to understand that someone with NASH at stage 3 or 4 needs to get treatment for it and also reimburse treatment. So maybe that builds the way for the NASH market. And of course, you can debate, should NASH then be a subindication of obesity or not? But I think it will be a stand-alone market. And I think that is becoming more and more obvious. But there's no doubt that it's critical to understand the huge correlation between these cardiometabolic diseases. And in that sense, we come from a strong platform by understanding this space quite well, by having an expertise in developing molecules to basically combat cardiometabolic diseases. So in that sense, I think we are positioned well. But it's obviously something that we all need to learn much more about. And the NASH space is quite, as I said, unchartered territory for all of us, regulators among us. So I think time will tell, but it's one of those open questions that we all are looking for an answer to.

Okay. Great. And my last question is just the practicalities of selling semaglutide as a weekly diabetes at 1 milligram dose, as a potential obesity product at 2.4 milligrams, and then in NASH as well with a dose. Is that possible to do in the same device just putting different stoppers in? Or would it actually require rebranding and sort of different administrations? So there's no cross-fertilization across the indications?

Right. So there are a couple of aspects to that. And of course, we need to be a bit patient here before we have an approval of semaglutide in obesity. We cannot really be more concrete in terms of the commercial strategy. But obviously, we need to be smart here in terms of how to do that in the best way. Saxenda, which is basically the higher dose of Victoza, but branded as an anti-obesity medication, is really an anti-obesity medication. And I think it makes most sense to have them separated. And also going forward, with the various doses that will be in circulation, with Ozempic right now being on the highest dose 1.0 milligram for type 2 diabetes, we also have a current trial ongoing with a higher dose Ozempic, that's 2.4 -- sorry 2.0 milligram, and then semaglutide in obesity is 2.4 milligram. So obviously, there are some decisions to be taken here. Device will also play a role. If it's a fixed-dose device, that could also give us more flexibility in terms of doing different go-to-market strategies in terms of pricing and branding, et cetera. So I think, here, we need to take some deliberate decisions, but we need to wait a little bit before we have more concrete answers to that.

Okay. Fantastic. Unfortunately, we run out of time. We didn't touch on a few things that are of interest, so we could have talked about stem cells, we could have talked about your smart insulin. So of course, if people have questions, I'm pretty sure you're happy to host them if and when. But thank you for your time, Kristoffer. And I'm hoping everybody has a good day at the virtual conference.

Absolutely. Thank you, Michael, and take care. If anyone have follow-up questions, feel free to reach out via my e-mail or give me a call. I'm happy to follow up. So thanks again for the interest and stay safe.