Sanofi (SAN) Earnings Call Transcript & Summary

Good morning. It's my pleasure to welcome Sanofi to the JPMorgan Healthcare Conference. I'm Richard Vosser, European pharma analyst. And from Sanofi. I have standing next to me Paul Hudson, the CEO of Sanofi. Before I hand over to Paul, I'd just remind everybody that the breakout session is in the Borgia Room at the back. Paul, welcome to the conference.

Thank you. Thank you, Richard. Thank you, everybody, and good morning. Delighted to be here. Delighted to be representing the company. So the normal comments on forward-looking statements. Okay. So let's cut to it. So the plan we have at Sanofi is a bold one, it's an exciting one. The work starts now, but the benefits really materialize over 2 phases. Firstly, and up front, we're refocusing the organization. We're working hard on making some tough decisions. And we're doing that in pursuit of an increased top line performance and increased commitment to margin expansion. The benefits that come in the second phase are really a direct result of the effort made in improving R&D productivity and in terms of launching transformational medicines. There's a lot that goes into this, of course, but it's worth recognizing that we don't underestimate what needs to happen to completely transform the company, the patients we serve and our place in the industry and beyond. Before we get into the real detail of the sort of how, I think it's worth reflecting on the key areas that we're bucketing our work into. I'll touch on some of them in a little bit more detail, but this desire to focus more on growth, to get the top line story right, to make sure that we're investing correctly in what we call the winning platforms and mechanisms. We'll talk a little bit about Dupixent in a moment and its role in that. Refocusing our science and making sure that the fantastic opportunities we have, the hidden gems, in many cases, are properly articulated, properly dimensionalized and, even more importantly, properly resourced, that we work tirelessly to increase efficiency and productivity. We're making some bold commitments to what we'll save in expenses. Much of that will drop to the bottom line, but we'll take the opportunity where we can to reinvest in winning opportunities. And to the people, the people that I've met and worked with over the last few months are incredible in the company. I think it's a bit of a well-kept secret just how good they are, and I look forward to unleashing them, if you like, on the opportunities we have in front of us. So Dupixent, we have a bold plan to exceed EUR 10 billion, and we think that's more than achievable given the unique profile and then just simply high quality of the brand and what it does for patients. We put that out there because we want you to know how bold we are and how we're going to resource that to win. Our Vaccines business will grow mid to high single digit over the period. It's a resilient business. It is a business where we think we can excel right across our portfolio. And of course, we'll talk a little bit about the pipeline opportunity. Let's get into Dupixent. The Th2-driven inflammation market is as big as the type 1 inflammation market now. Now let's think about that. The type 1 market is over EUR 50 billion. It's got all the household names in it. We are very well aware of what we need to do in type 2. We know the competitive set. We know that not all of the players will play right across the indications that we have. We know that we are, without doubt, unquestionably the most effective and safest profile. So we think we can be a winner over the long term. We're already demonstrating that we can win now. In atopic dermatitis, we're already in the dermatologist office attempting to become and will become what we'd like to think the #1 biologic in that space. We have the profile, again, to do that. We will go after Humira, of course, in terms of volume, but we're already way beyond all the recent launches. There are several reasons for that. Our profile in atopic, our efficacy unquestioned. But this safety profile is one of the most interesting components. It's almost placebo-like. And when you look at the way the patients present and how young they are, you get a real sense for why it's important, why it's important to have a clean profile as you go into the adolescent and the younger patient population. The penetrations are still very low, so the market opportunity is significant and we think well within reach of helping us build the opportunity for the EUR 10 billion. In asthma, we didn't launch that long ago, less than a year in fact. And already, time aligned since launch, we are the fastest growing of the biologics. Interestingly again, the majority of our patients, 80%-plus, come from the naive space, which is really important for us. It shows you that our profile is really what will drive adoption and make us the medicine of choice. Again, the penetrations in this patient population are very, very small, so the opportunity in front of us is significant. We won't spend today any time looking at the rest of the indications, but we go into nasal polyposis, we go beyond into other indications. You'll see, as they come together, it's a significant potential for us. On to Vaccines, we'll go -- we'll grow right across our range. Now we have a unique business. We have a proud history. At the end of the cycle, we'll go on to RSV, and we'll do something what we think will be game changing for those patients at risk, the young patients. But our flu business is unique, and it's quite incredible, in fact, how we're growing that and what we'll do with high dose and how we hope to capitalize on the market. The PPH business, too, and we commit to this mid- to high-single-digit growth in our Vaccines business. So looking at the pipeline in a little bit more detail. I like to be competitive. I think there are times when being competitive creates noise, creates education, creates an opportunity for patients to get a better medicine. I've never worked in the hemophilia market before. I'm excited about what can happen and what we can do in both heme A and heme B. The fitusiran profile will be a true monthly hemophilia product, a true monthly hemophilia product. We know that, from at least in surveys, that Hemlibra, less than 10% of patients are on a true monthly schedule. We know that 90% of those Hemlibra patients are, in fact, getting breakout bleeding. We also know that 75% of them opted for Hemlibra because of convenience. We hope to completely disrupt this market. If our profiles are good, we will be a true monthly. And for those patients that want as normal a lifestyle as possible, with BIVV001, we'll capitalize on our opportunity to have near-normal bleeding rates. The third, we think we have the first, we think we have the best. We will start and lay the lines and will work our way forward to be in early breast cancer. We have no cardio tox. We have a great profile. And you need a great profile in these patient populations. They're older. They're over 60. They may be on beta blockers and may have different requirements. We know that it will be important for us to demonstrate a winning profile here to be used as the medicine of choice, and we will achieve that position. Venglustat will focus in lysosomal storage disorders to start, but will, of course, go on to polycystic kidney disease and beyond that even into GBA-Parkinson's. We could go even further into Parkinson's. We know these areas. We're comfortable with our approach, and we hope to reveal data as we go along to show our suitability. I've mentioned emicizumab because it's important to understand that a monoclonal in these patients at risk with RSV, this will be the first real opportunity to do something prophylactic on a global scale, and we think that we can really do something special here. I think we have one of the best vaccines businesses in the industry. I think we know how to talk about these patients. Many of us have worked in this area before. And we're comfortable that as we get to market, it really will change the shape of the vaccine market. The BTKi, the brain-penetrant BTKi, this, again, is something really compelling for us. Now we're very close to the readout from the Phase II data. And we know that the market has recently been disrupted by OCREVUS. It may be even by ofatumumab, but we know the role of the B cell depleter, the role of the BTK will be critical in deciding what becomes the future standard of care. Now the only brain-penetrant BTKi has a lot to prove. And if it comes through the readouts in the coming days and weeks, we are ready to go with 4 Phase III studies. We have waited. We positioned ourselves well. We prepared in terms of site selection, patient identification. So we will not wait, and we will not hesitate. If it reads out strongly with the right profile and we think we can cross the blood-brain barrier and do what needs to be done for the patients who need it most, this, frankly, will change the game in multiple sclerosis. So the Synthorx acquisition was a real pleasure. And it was quite early on after joining the company, but it's something everybody in the organization has been excited about for quite a while. The role of IL-2, the non-alpha-binding IL-2, the ability to drop the PEG straight on there to stop the binding and focus on the beta and gamma, the opportunity to create this proliferation of T cells and to work alongside a PD-1, we think, will become a new standard of care. We're fully aware that it's a competitive market. We know, of course, that there are competitors that have multiple PEGylations and in vivo as they fall away. Unfortunately, the alpha receptor can be targeted. And of course, vascular leakage and the other effects that may hinder the opportunity for the patient to have the right balanced profile will become very real. We know our dosing schedule, we hope, will be there. And we think with everything that we believe that the ADAs and the safety profile will show itself as the winner in the IL-2 space. We know IL-2s have been around a long time, but the opportunity to actually put them into the treatment paradigm and to do something incredible is just around the corner. We're delighted, albeit it's not closed yet. We're not too far away from that. We think we're going to change the game, and we're excited about what that can mean. We do think we have the winner in the IL-2 class. As a matter of acknowledgment, this is where our company should be playing. This is where -- combined with our internal science, this is where we should be adding to the science to do incredible things for patients and, in turn, on the shoulders of that, do transformational things for the company. So we didn't just boldly lay out a plan that would involve spending a lot and acquiring new science. We tried to be responsible in how we're going to manage this. We didn't deliberately lay out a top and bottom line set of numbers that we'd be pegged to on a quarterly basis. We tried to show some responsible leadership by saying, this is the BOI that we expect to get. And if we do our job properly, there may be opportunities where we want to add to our expenses to further accelerate the performance of a medicine or to invest in an acquisition in terms of ongoing P&L commitment in R&D. We wanted to maintain the flexibility but not shy away from our responsibility to deliver an increasingly improving performance for the company. We set ourselves 2 goals: so 30% by 2022 and for 32% by 2025. And that will take us some way towards getting to the peer average. Of course, that requires some good discipline. It requires some breakout top line performance. We've talked about Dupixent, we've talked about vaccines, but we believe with some sensible cost management and healthy spending and reallocation of resources, we've got a very, very good chance to do that. We made some tough decisions as well to help us get there, and we can talk about those in a moment. One of those things to do was to try and look at our structure and to say, what is it that's going to help us deliver the strategy that we have, and why should people believe. We've only made some minor adjustments, but they're quite critical to the ownership and accountability in the business. A stand-alone consumer health business is simply designed to make sure that we put the agility and the speed back in to what we're doing as a company. There is an intent to recognize that when you have a consumer health business, a very good consumer health business that is part of a big pharma company, it is actually sadly possible without even noticing to overencumber it with system, process and requirements that would not allow it to be competitive in its own space. For us, we're going to try and make sure that we can put the flexibility and agility back in that business by literally making it stand alone. That does 2 things: increases speed, for sure, but it also increases accountability in the consumer health team. Now over the last years, we've gathered pace, but we're still growing behind the market. And we have a huge responsibility to accelerate that and to get back to where we need to be. There is also a very important event in the not-too-distant future, which is the Rx-to-OTC switches of Cialis and Tamiflu. Now while they're a little bit further out, they do have an opportunity to change the game in terms of top line performance for consumer health. Now if that is done to the level that we think needs to be done, we have a realistic chance to be the industry leader in growth in the 2023, 4, 5 range, which I think will be a real bold statement for that team. And I think unencumbered, I think they have the chance to do what they do best. For the rest of the business, we pretty much pulled together our Primary Care infrastructure and took away some of the duplication between our China/Emerging Markets and brought together what we think will be a very vibrant and growth-oriented general medicines business. It's a large part of our company. And in fact, what we're hoping is that it trades on what is the very best characteristics of Sanofi: the entrepreneurism, the innovation, the use of digital, with a combined objective of outperforming on the top line and becoming increasingly more efficient and profitable as we go along that journey. It is going to be a place to be in the organization, and it's going to be a place that people can feel proud of what they're contributing and helping us fuel not only our pipeline but all the other investments that we'll make along that journey. Our Specialty Care business is incredible. In fact, we're blessed with many of those medicines that I've already mentioned and more. And I think we have a huge chance to really make that a vibrant, fast-growing, industry-defining group of medicines in that -- in our Sanofi Genzyme business. So again, excited about that. I've talked about Vaccines, but we're also simplifying our structures in and around the GBUs. We sort of got caught between models, and we had a lot of central structure and a lot of regional structure. And we do this, not that you're particularly interested in that sort of thing, but you should be aware that we try to simplify to increase alignment and to redeploy resources, which, frankly, we need to do to make sure that we can hit the BOI and invest in the science. And I think we have a more-than-able plan to do that. So since I started, I've been asked a lot of questions about Regeneron. I think it's important for people to realize that Dupixent, of course, is a real deal, but we made some efforts to simplify our relationship with Len and the team. You may or may not have followed the fact that we got out of cardiovascular in the U.S. with Praluent and we took worldwide Kevzara. And we did it really because 2 companies working as partners can sometimes create some additional bureaucratic burden that really isn't helpful over the long term and doesn't allow us to simplify. We think they've done correctly, and we believe we're set up well. And we have great spirit between the 2 companies. We can, again, put some agility back into that partnership on those medicines. I'm asked, what does that mean for the Regeneron stake. And we're trying to be explicit really for both companies but also for us that we're proud to be a shareholder in Regeneron. But also, we have to recognize that if better opportunities come along for investment decisions that we would have to make, then we may take them. It was important to, sort of, bring in some clarity, I think, to where -- to the ongoing series and set of questions. As for the rest of capital allocation, we really do want to put investments into driving our business and to driving the top line. I've touched a little bit on the Synthorx piece, but the BD and M&A focus is really around new mechanism plays, things that could be complementary to our existing infrastructure, areas where we have ongoing clinical and development expertise and areas where we really think that we can change the practice of medicine. I think an accusation labeled or leveled at us over the last years is we've been a little bit too into the late stage, a little bit too risk averse and perhaps we've changed the profile of the company to be a little bit conservative. I can tell you from the people that I'm working alongside now it's not the case. I can tell you that the commitment to the science and the enthusiasm about our future is vibrant. But I think we can step forward and recognize not everything is going to work, but more is going to work than not, and that's the type of culture we're trying to create. And I think we can do that, and I think we've seen enough already to know that. But we will enrich our pipeline with opportunities externally. And for many of you that I've been talking to since I've been here, I think you get a sense that we're serious about that. You know our principle around growing the dividend. And we added the anti-dilutive share buyback point just to let people know that on the list of things to use our capital on, share buybacks wouldn't be at the top of it. We will do things if we need to depending on avoiding a dilutive position. But really, we think we can create more value long term for shareholders by making much more sensible decisions about getting involved in cutting-edge science and seeing what that looks like. Many -- by way of summary then as I reach the end, I've been with the company 4.5 months. I found incredible raw materials. I've been lucky to inherit a lot of good things, most of which that have never really been shared or not communicated well. We can argue the whys and wherefores of that. But I think some really quite incredible work is going on in the company. I'll play a role in trying to bring that forward and excite people externally. I'll be realistic about the fact that not everything is going to work. I'll be challenging and urgent about what we do to make sure those things get delivered. And I can tell you that the company is already rising to meet that set of principles that we're rolling out, both me and as an Executive Committee, and I'm very heartened and very humbled already by what I've seen. We're taking the actions. We're not scared we're out cardiovascular, we're out of diabetes research. So we're not going to keep looking back. We're looking forward. We're trying to be a bit more brutal on our pipeline and say, if it's not first or best, should we really be in it. We're going to try and avoid the me-too-late phenomena that drains resources and takes away our opportunity to deliver in cutting-edge science. We -- there's enough energy and commitment to cost saving and redeployment of resources, exactly the right amount of energy that we need. And I think we've been on a journey also of being committed to cost saving and not taut enough about our pipeline. I think it's time to bring those 2 things together, which is to share with people that if we do some very healthy work around cutting out the waste, reinvesting it in the pipeline is worthy work and work that everybody should be proud of and part of and frankly is overdue. You'll see a lot more attention to that as we deliver as an executive team. And finally, we're not pretending that we're just going to out and spend a lot of money. We're not pretending that everything is rosy. We're saying that we think we have a very sensible plan for delivering on a BOI objective that we believe should give confidence. We've given a EUR 10 billion-plus objective for dupilumab, which we know the profile of the medicine should easily be able to deliver on that. We know, in fact, that the competitive set is really not credible in terms of challenging that. So that's really in our hands to deliver the top line performance and the increasing profitability that goes with that. We also know that we're going to spend a lot of time making sure that where we get a chance, we're going to be much more celebratory and much more positive about what we're finding and what we're doing. It's hard for me to fully appreciate the opportunity that's been presented for me. I can tell you it is -- not only am I humbled, I'm incredibly excited about what's in front of us. I've seen enough raw ingredients and I've seen enough talent to know that this agenda at a minimum is more than achievable, and what we do above and beyond that is also not outside our reach. Thank you very much.

Welcome to the Sanofi breakout at the JPMorgan Healthcare Conference. I'm going to had you over to Paul to introduce the wider Sanofi management team before the Q&A session per usual. And let's go ahead.

Okay. Good. Thank you. Olivier Charmeil, who runs China and Emerging Markets; David Loew, who runs Vaccines; John Reed, as you know, R&D; Bill Sibold, who runs Sanofi Genzyme; and Jean-Baptiste, effectually known as our CFO. So we're ready, we're here. It's a bigger table than last year, so make sure we got some good questions, that'd be great.

Right. Maybe I'll kick off then. And just thinking about the margin targets that you described in the presentation. I think there's been some element of skepticism maybe about the 32% margin. So just -- and maybe thinking about the 30% margin, talk about the levers you can pull to get to those.

Sure. So I'll let Jean-Baptiste comment in a second, but there may be skepticism. But frankly, there's been more skepticism for longer about what we failed to deliver before. And so it was really a line in the sand to say, this is what we're going to do, and we're going to do this. And we recognize we've got to own credibility in that, but that's what we're going to do. So we will do the 30%, and we will do the 32%. With a favorable wind, we'd do better than that. But we think that's a minimum expectation. We know that there are levers within our control to do that, and we will do that. We think, at the same time, as we build in the pipeline, it takes away the uncertainty on why people are a little bit concerned about us, but then they're, okay, you're going to do what you said as a minimum, and you're going to go after the things to create more value. We wanted to make sure that was really clear and explicit. So not underestimating the work required to do it, but that's what we're going to do.

Yes. And maybe you have to think of the -- always going to move between the different segments because Vaccines is accretive to our BOI margin and so is our OTC business. And of course, on -- talking of Dupixent, which is partnered with Regeneron, as everybody knows, but when it reaches a certain threshold, and this is much before the EUR 10 billion we are aiming to and that should kick in during this period, well, it becomes also accretive to our BOI margin target because of the sheer volume and the high gross margin on biologics.

Maybe following up then on Dupixent. Obviously, you've put an ambitious EUR 10 billion target out there. Maybe giving us some idea from where you are in atopic dermatitis and asthma in terms of the profit penetrations now and in terms of a road map of getting to that EUR 10 billion.

So I'll let Bill comment in a second, but I've worked in a lot of monoclonals, this is the best safety efficacy profile mix that you'll see in any, number one. Number two, the Th2-driven diseases are horribly underpenetrated and hardly undereducated. You know from Q3 that we're annualizing at over EUR 2 billion annually already. You'll also know that our penetrations are low single digit in the indications. So if you look even at psoriasis, which is closer to 20%, that's not taken that long to get there. If we set our goal of getting to the 10%, 20% penetrations, we are already tracking very favorably to the bigger number. We know there's just -- there's more than enough patients that are struggling that would benefit, for sure. And we know that what we're asking in terms of access and penetration are well within the well-understood and accepted dimensions in biologics and biologics in the dermatologist office. So we have no concern about that. But Bill, maybe you want to add some color?

No. No, that's exactly right. We're just at the very beginning, it's how we really characterize it when you're at low single-digit penetration in large indications like atopic dermatitis. We've talked about, in the U.S. alone, if you take a look at biologics-eligible, it's about 1.6 million, 1.7 million. We think about 300,000 most in need. And we're about 3% of the way there. I mean that leaves a lot to go. So -- and beyond the core indications of atopic dermatitis and asthma, we have the new indications that we've announced, and we have geographic expansion as well. Just to remind people, with asthma, for instance, we are only in 1 of the big 5 EU countries so far and expanding globally. So yes, it's at a start. Long way to go, but we're excited.

And the difference I'll add as well, Richard, is that when I've worked in other areas on the type 1 inflammation, if you like, space, it's incredibly competitive and not a great deal of difference between the antibodies. Let's be really frank, the JAKs, although they may make progress on efficacy, the side effect profile trade-off and the inevitable black box warning means in a dermatologist office, particularly for younger patients, it's not an option. And we also know that the IL-5s and asthma are incomplete. None of those competitors play across both of those big indications. And then finally, there appears to be some recent interest in the IL-13 as a competitor, which, frankly, had gone almost unnoticed until very recently, and there's a good reason for that. It's IL-13, not IL-13, IL-4, and it's already failed in asthma. So we know that it's unlikely in Th2-driven disease that it will make the progress or have quite the profile of Dupixent. So we start there, under-penetrated, well-supported, struggling patients and with a manageable competitive set over the medium to long term, and that's why I think we feel very comfortable.

[indiscernible] in the U.S. in terms of the diabetes formularies going into 2020? And is that a drag on margins for the next year or 2? Or is it -- how to look at it from a margins side?

So the question -- I'm told to repeat the question, is that right? Diabetes drag 2020 U.S. Sorry, just simplifying. The -- I'll ask Jean-Baptiste to comment, but the fundamental is, our volumes have been very good but the pricing pressure has been significant. And so we've had double-digit decline in the overall top line. It is what it is. In '20 -- this year and then just nibbling into '21, that drug dissipates because the prices get to a point where there's very little else. So we still make a margin because, of course, we know how to make these things, one of the best in the world, if you like, at making them. But the top line really erodes quite quickly. After that, by the way, we're a bit more stable. Ex U.S., which doesn't get asked about a lot, but Toujeo does great. Lantus is on the essential drug list in China and -- uniquely. And we have opportunities with Soliqua also in China that mean that our diabetes business outside of the price pressure in the U.S., which starts to bottom out, is actually going to become an interesting and very efficient way of driving business, and we'll do that, but outside the U.S. Nothing to add?

And it will remain a big cash contributor to help us to reinvest in our innovation, in our pipeline.

You said fine without it in '21?

'20 -- this year is one of the big years as that sort of compounds, and it may just nibble into '21, I said, but it's really the next 12 months is where we see that start. And for me particularly, with all the excitement in the business that I find, once we get through '20 in that and Aubagio in '23, we really have the major events behind us. And we have more than enough coming through the rest of the business to say, okay, so you can absorb those and keep moving. That's what one of the questions back to the BOI was, the 25 number, is that realistic given Aubagio and everything else. And we feel there's enough in the base as it moves that, that gets delivered, including diabetes.

Maybe while we're on this area as well, just thinking about China and the transformation from the older products that are seeing -- catching up to the newer products. Actually if you could describe how that -- how would you think about that through '20 and '21?

Yes. Look, we've been on a bit of a journey because we were like one of the major players. We go into the volume-based procurement challenge, we win the tender. What people -- many people don't know is that this team in China is skillfully managed, a headcount reduction of 2,000 people within weeks of that announcement. So we know we need less resource and more digital and more things to pull through on the volume, but we have to do it more efficiently. We still make a good margin on all of those medicines impacted, but we do know that we have to grow volume. In the meantime, we're building a future Specialty and Vaccines company in China. Maybe, Olivier, you want to make a comment about the 25 opportunities that we have?

Yes. So we'll have 25 launches/indications in the next 5 years, and it starts in the next 12 months with 10 new products that are going to be in a position to be launched. So if we are looking into the next 5 years, the key drivers of our growth. And Dupixent got submitted at the end of December. We got good news at the end of December with the launch -- with the approval of pilot that we are going to launch in the upcoming months. And we are expecting to get enough reimbursement within the next 12 months or end of 2020, 2021. So we have also opportunities in rare disease where most of our products are getting registered, and The level of attention of the Chinese authorities with regards to rare disease has very significantly increased. There's been a lot of action in the last 12 to 18 months, which means that when the question of the funding is going to really go. And we are starting to see clear indications that at some point specific funding is going to be put in place for rare disease. This will, of course, provide satisfaction to our business. We have products. The reason we decided to play the volume game in China is that if there is one company that can be successful with volume, it's definitely Sanofi. Back 10 year ago, we were one of the first company to go into the country. It's 900 million people that today are underserved. They have mechanism, they have coverage, medical coverage that have been put in place. So we see very significant opportunity for the future. Here on our diabetes portfolio, you alluded to, Paul, but also on our Clexane that has never been developed at the level of other emerging countries or Europe. Also, there are significantly -- significant potential for us on the volume gain.

Thank you.

I have a question on fitusiran and then compared to fitusiran versus Hemlibra. And also more in general, your ambitions on hemophilia [indiscernible]?

So I'll let John comment because he developed Hemlibra in a moment. But for me coming in new into the role, I have a chance to be underwhelmed by assets that I find and make a judgment call. And I was quite critical and challenging of our hemophilia business to try and understand is it good money after bad? The more I looked at it and I understood the concern externally when the Bioverativ from the Alnylam types were done, there was a sort of, do you guys not know Hemlibra is coming? Have you missed something? And the reality was, we hadn't missed anything. What we'd underestimated, I think everybody did, including Roche perhaps, was how quickly -- how fickle patients were to move for convenience. And I think that dynamic that exists was underestimated because everybody thought it would take a long time and the factor market would stick around. What has transpired is, some patients are looking to lead active lives and want a normal bleeding rate and some are just solely going for convenience because the 3 -- infusing 3 times a week is just too much of a burden. What I've inherited is 2 extraordinary assets, if they deliver on the profile. If the safety profile of fitusiran is similar to Hemlibra but is a genuine once monthly, and by the way, because of the SNRI mechanism, a chance to go even longer than monthly ultimately with more development work, we may actually have the winner. You know and I said it in the main room, less than 10% of Hemlibra patients are on -- genuinely still on a monthly doses. And for BIVV001, you have a near-normal lifestyle weekly. So we think as the -- we know the patients are all in play. We've seen how they move So if our TPP, if our target product profiles are right, then I think we have every right to expect to work both ends of that market. Don't think it will be easy, but I like to compete, and I think we'll be able to do that. Anything to add, John?

No. I think the -- Paul said it well. We have the -- really, if the patient is more interested in convenience, I think fitusiran meets their needs. The SRNA molecule is a 1 cc, once-a-month injection. We may even be able to do it less frequently compared to -- over that same period of time of 1 month. If you're doing Hemlibra, you've got 4 ccs to inject. It's active for both hem A and B with or without inhibitors and also has an added benefit that because of the type of molecule, an SRNA, the cold chain, the seriousness is not what it is with a monoclonal antibody. So you -- if you were traveling, you could throw a syringe in your suitcase not have to worry about refrigerating it for a few days, things like this. So to the convenience play, fitusiran, we think, really has a very attractive profile. If you're more in the efficacy game, where you want to have a completely normal lifestyle, you want to be able to do downhill skiing, you want to be able to play volleyball, you want to be able to do all the things you were always told you couldn't do as a hemophilia patient, then in that case, the BIVV001 meets your needs because with a once-weekly at-home IV infusion, you'll be able to maintain a factor level that's within normal limits essentially and enjoy a completely normal lifestyle. So that's -- we have both of those covered with those 2 products, and so we think that's going to solve most of the problems for the patient. So I don't know, Bill, do you want anything to add?

I think -- well, I was going to say we think we have a bigger patient opportunity than just downhill skiers and volleyball players, just to be clear. We -- but I think those seeking an active lifestyle without concern, I think, in general, is going to mean that it's going to be a real opportunity. I'm excited about it. As I said, by the way, up front, I had an opportunity not to be interested. And I found that whilst I may not have done the deal, I'm glad that it was done. And now I look to see what can be done with the assets that we have.

And this is on top of the Synthorx. You said part of the rationale for the team is to combine multiple therapeutic approaches. Can you elaborate on what some of the potential planned combination therapies might be?

Yes. With Synthorx -- so the question was what are the combination opportunities with the Synthorx molecule. This is the non-alpha, as it's sometimes called, non-alpha IL-2 that does not bind to the alpha chain, the IL-2 receptor, which is the characteristic of native IL-2 that gets you in trouble with side effects and other problems. So indeed, one of the reasons that -- the main reason we acquired the -- we're interested to acquire the asset is because of the potential for combinability. The first approaches will be sort of the obvious thing, to add on top of PD-1 therapies for types of cancer where PD-1s are already established. But more exciting for us, I think, is moving into other approaches. We have a pipeline of T cell engagers and NK-cell engagers that are coming out of the labs, a lot of that actually based on the Ablynx acquisition that the company did a couple of years ago where we have a platform for making really innovative, multi-specific antibodies. Those are starting to move into the clinic. And so that's the way to get a T cell or NK-cell started, activated in the tumor microenvironment. And then with the THOR-707, we'll be able to amplify those cells and stimulate their proliferation so that you really amplify the response. And then finally, you can use our PD-1, Libtayo, to take the brakes off those cells and ensure you have the full sustained immune response. So we really saw this THOR-707 having an engineered IL-2, like this is a core pillar of a comprehensive IO portfolio. So that's first place we'll go. Although because this molecule also stimulates NK-cell proliferation, we go immediately to medicines like our isatuximab, our CD38 antibody, which part of the way it kills myeloma cells is by engaging NK-cells to attack the myeloma. So these 2, again, should be highly synergistic. So that'll be an early study we'll do will be isatuximab together with the THOR-707 in myeloma.

Maybe we can just talk about vaccines for a minute as well. Just you highlighted in the presentation mid- to high-single-digit growth. Just maybe give us a bit more detail on the drivers behind that and when they come in and...

Yes. Look, so being new to the company, I've never worked in vaccines before. I've become a little bit obsessed with how interesting and how cool it is as part of our business. I mean it's a lot of capital to get there. But when you're there, you can really do things with -- clearly with very long attitudes towards IP. And I think we have a very rich history. I think David and the team have done a tremendous job. So maybe you want to share some of the excitement, David?

Right. Thank you, Richard, for the question. So when you think about vaccines, of course for many of the analysts, it's a bit frustrating that you don't get a good script data from like IMS, et cetera, so it's harder to model it and predict it. Also, a lot of the sales don't only come from markets like the U.S. You have actually a lot of sales also coming from emerging markets. So let me shed a bit more light on what is driving this mid- to high single-digit growth and what's the mix of that. You need to remember that we have 6 launches coming up in the next 5 years. That's very exciting. And these are in very important diseases. So for example, Fluzone High-Dose QID that we are launching next season in the United States, so that's the new version of Fluzone High-Dose because it was a TID. So 3-in-1, now it's a 4-in-1 with some pricing upside, of course, given that it's a better flu vaccine. We are launching Flublok in the U.S. as we speak. It has seen a very nice pickup also this season. We're going to expand that also now into other markets worldwide. Then we have Vaxelis. That's the new pediatric 6-in-1 that we're going to launch in 2021 in the United States. And here, GSK announced that they're probably not going to come with their pediatric vaccine, so that's going to be a quite nice play for us. We are going to bring in new meningitis vaccine. When you look at the clinical data, we have seen differentiation on the immunological responses. So we are getting very positive feedback from the key opinion leader community. They are excited about this. And then we also are going to bring a new RSV vaccine, like Paul presented in the plenary presentation, where when you look at the Phase II results on 1,500 babies, so that was not a small trial, that was a very large trial, we have seen a 70% decrease in infections of babies and 80% decrease of hospitalizations. We know that RSV is a very big burden on the health care system. There is no solution today except for some very preterm babies, which is reflective of 2% of the baby population. So here, we're going to come with an antibody which is going to protect those babies. And it's all babies, in fact, because 90% of the burden of disease is driven by normal-term babies. So that's going to be a completely disruptive approach. You can then model on, okay, when you increase your sales, how do you do that. You can have a pricing upside because you have more modern vaccines, and you can have volume upsides. And on the volume upside, you can gain market share because you're differentiated. You can, in fact, increase vaccination rates because many markets still have too low vaccination rates, for example, on flu. And you can also expand in geographies where we have not been playing so far. So differentiated flu outside of U.S., we have not been present. Mening, we have not been present really outside of the United States. So just to give a couple of examples. So that is what is going to drive this mid- to high single-digit growth.

Do you have a program for RSV purine? Not the prophylactics...

Vaccine?

No. [indiscernible] vaccine.

RSV, do you have something?

No. So we are really working on the prophylactic space.

Only? Well, that's -- from prophylactics achievement, can you learn something to get the other thing done?

Yes. You probably could. The only thing is that once you have this prophylaxis working so well, why would you want to develop now a cure?

There's a lot of treatment already in the market.

That's clear. But until you come -- when we come with a new prophylaxis and you start to vaccinate everybody, that window goes away, right? So...

No market, for sure.

Exactly.

Okay.

Can I ask one, Paul, on Hemlibra? There's been some reports on safety issues, of course, launching now in new locations. I wonder if you could shine on a light what's happening in that market.

I -- we can't really comment on the profile other than what we know that we compete with in the label. So I think they broke new ground. And of course, they'll learn about that medicine as they go, and we'll find our place as soon as we're ready.

Maybe one question on [indiscernible].

Sure.

Are you looking to implement any value-based contracts coming into '20 and '21 even in Part D?

So I've had sort of an underwhelming experience with value-based contracts. So we're trying very hard. It is not easy. It's very easy to get a demonstration project, it's very hard to get it scaled to large populations. So my own rule of thumb, for what it's worth, is you sign up to do a value-based outcomes or outcomes-based agreement only if it's predefined, if you deliver these results, what it means for a wider population. Otherwise, you just simply spend too much money managing the data and administering the scheme, and you never quite get to the population effect that you want. So I think we're open minded, everybody, and we try and do what we can. And I think if that -- if it gets into Part D and other initiatives in Part D, I think we're open minded. But I think just from a technical aspect on value-based contracts, I think we're still yet to see the real definitive moment where somebody stepped up for a long-term investment to change the fate of a large population in any locality.

I think we're out of time, so thank you very much.

Thank you.

Thank you.

Thank you.