Sanofi (SNY) Earnings Call Transcript & Summary

Thank you guys for being here. Pleasure to have the CEO of Sanofi, but even more importantly, Chairman-elect of the PhRMA organization, which I hear is not the most effective organization in the world. So which one are you more excited about? Let's start there.

Well, I'm very excited to be the CEO of Sanofi, of course, and we have some readouts ahead of us will tell me whether my excitement is well placed or not. On PhRMA, I was one of 17 CEOs who got a letter from the President in July asking us to voluntarily adjust our prices worldwide in favor of the United States. And just as a small side bar, you don't often get a letter from the President of the United States. So -- addressed to you personally. So I sent it to my kids in the WhatsApp group. I said, oh, I had a letter from the President of the United States. And they go, way to go, dad, you're the coolest. I went, none of you read the letter. Then I go, Dad's going to jail, Dad's in trouble. And I think Trump -- whether you like the chaos, whether you understand the chaos is orchestrated, to push us voluntarily to make a call on what we do rather than legislate, which may not get through in his tenure. Whether you like it or not, it's having an effect. 5 companies has gone already. For me, as the incoming Chair, the first order -- the first thing to be concerned about is the disintermediated PhRMA and went to the 17 companies. And so what is the role for PhRMA as intermediary and mobilizer and convener in that situation. I think I hope to reset a bit of that. I think you once said on a podcast, my personality is perhaps more akin to being in rapport with the President.

Donald Trump's golf buddy.

I'm not sure I felt about you putting us together so closely. But I do know that, I think it's my job to say we can bring the industry together, we can do better things. That's, first of all, confirm that this is the end of what you might be trying to do in your tenure, if possible, I don't know. Secondly, okay, what about the PBMs and 340B. There's going to be some things carved out. There's going to be some demo projects, all the rest of it, but duplicate discounting, one, the PBMs, once again, managed to stay out of the fray. And I think if you've taken a win voluntarily off us, we're next for your voluntary win. And so I'd like to broaden the field of play, if we can, and shown them that we can get a few people to be involved. As it stands, he'll take some wins. Some companies have gone already. We'll see what happens next. And we don't know, by the way, what happens if you stay out and don't agree. And I'm sure many companies are watchfully waiting to see what is the tipping point for them to be involved. I don't know. I can't comment on others. I know we have been having a dialogue with the administration since before the letter, and that's continued throughout the process. So we'll see and do what's right for the company at the right moment. But as incoming Chair, I'd rather not be disintermediated, then I'd rather try and bring everybody together, then I'd rather try and direct the fire towards something good for patients, good for us.

Got it. Paul, I feel -- and I genuinely meant it when I said it on the podcast a few weeks ago, I feel like some of the PhRMA CEOs, at least from a personality perspective, this administration, more than any prior administration seems to be very focused on interpersonal relationships and sort of really a more expansive set of relationships. I don't know if that's truly been pursued by many of the CEOs. And I'm curious, where are you with that process? Is that a high priority for you just at an individual level to spend that time to actually convey some of these priorities?

Look, I'm -- you don't -- you go in sequence to become the Chair of PhRMA and you work yourself through the committees. And you make a bit of an effort because you think at some point, you're going to try and do something important for the industry. When I started a few years ago on this journey, I didn't realize we've been in quite this moment. And I think it's important to have some very direct conversations that are perhaps slightly less policy-driven and slightly more headline driven. And we know how it works. We know how the President has got everybody to the table. We know that these are the things we said we would never discuss. And here we are, and some companies have gone already giving up ground. I just think that we need to be realistic. The President is looking for wins. The midterms are ahead of us. It's not pretty at the moment. Popularity down, we're in the 30s, I can't remember. So it's a struggle. And I just think there are wins on behalf of the American people out of pocket, all these things that could be addressed, should be addressed, but there'll be good headlines. I don't come in until January. I think Albert is a big personality. And Albert has done what he can to try and manage this process. But of course, he's also had to make the best decision for Pfizer. And he's clearly made that decision. I'm not speaking off the record with that. But for me, I think I have a similar sense of smell for big wins, and I would like to try and bring that. I don't know whether the President will think I'm his cup of tea or not, but I will -- and my golf is sufficiently s*** to make sure that that's not an issue. So we'll play it by it.

He'll win, he'll win. I guess -- so which -- where that leaves me with is, clearly, a settlement with the administration is a top priority for Sanofi, I would imagine. But also being an inbound chair of the PhRMA organization as well, how do you balance those 2 in terms of preserving that PhRMA is not disintermediated, but technically, you did get a letter individually and the current chair already did their own settlement. So how do you balance those 3 things?

Well, I think PhRMA has shown that it has to evolve a little bit because Albert still chairs PhRMA and has already negotiated his own deal. So you can be on both sides of that conversation. I know that PhRMA is really about policy, right? We don't -- we have -- the lawyers sit in the meeting to make sure it stays about policy. And I think policy what's driven it for a very long time. And I think the policy conversation has never really changed whether people did deals or not. For me, you take on the chair to try and do the right thing for PhRMA, but I have to wear 2 hats. And in the end, the company agenda has to be the priority for me. It's what I'm paid for. But I don't think that those goals are mutually exclusive. So I give myself a good shot.

But you will parallel track both of those. Is that fair?

Well, it depends what you mean by parallel tracking. If you say, am I waiting around the corner from an announcement, I'm not going to share that with you as nice as you are. But I told you, we've been in conversation with the administration since before the letter. That never changed, and that will stay that way. I've got and we have a very good relationship with the administration. I've spent plenty of time on the hill and with the key decision-makers. I'll do what's right for the company. I'm not the incoming Chair. I'm not the Chair until the end of January. So much is going to happen between now and then for everybody. And then we do what's right for the industry in the long term. I didn't take the job -- any job in health care to drive more health and equity, but that may be where we're going certainly with Europe.

Makes sense. As it relates to...

I'm sorry, I should say, this maybe appear controversial. I don't mean it in this way, but I've had the opportunity to meet 3 heads of state in Europe over the past weeks. And I've asked them how they feel about the United States setting prices for their medicines in their country. And they all say, to greater to a lesser extent, it's outrageous or it's complicated or it's not what we'd like, different answers. But I said, well, here's the interesting thing. 54% of medicines approved in Europe are already not available in Europe, not reimbursed. So that negative battle on your desire or not to reimburse innovation in Europe exists pre-Trump. It's pre-Trump. So you don't want to reimburse the drugs, 54% of new innovation approved by EMA. You've already been on that journey. So it's a nice wake-up call. And again, whether I like the present, don't like the present, like the value, it doesn't matter. What's interesting for the first time in my executive career is European heads of state recognizing they have an issue with this, and they have to do something about it, and they have to pay for innovation.

Do you think they can find it in the budget dollars?

I think most of them have no money at all. And so the question is, do you keep the same budget move prices up and just give less people medicine, zero-sum game? Or do you actually try and free up some money knowing that it may spark inward investment in your country. There's always -- in Europe, it's always had a disproportionate level of inward investment for what it spends on medicines. That is how it is. And I think that's very reasonable for them to think that. But so that means if you're Germany, the U.K., we all love Oxford, Cambridge, Imperial, UCL, but it's not enough if none of the medicines are available in the U.K. We may invest in early science, but we shouldn't build manufacturing sites. And now the U.K. just announced the deal themselves moving towards the amount. I think it was yesterday, they announced that they were going to move from 0.3% to 0.6% GDP, which is what the Americans are expecting but as part of the overall trade deal. What it means to making budget available over what time line for PhRMA, I don't know. Do we want to continue to do clinical research in studies -- have studies in countries where the medicine will never be available eventually? There's a little bit of a moral crisis for us in that. So I think Trump has forced a debate in Europe about your question, spend more money or not for the first time at scale that I've seen since I've been an executive. Where it nets out? Not sure, but some countries you feel smell opportunity versus others. That is for sure. And you can see that with our heads of state and Ministers of Finance are talking to me and others like me. And if that leads to access to medicines that didn't exist before, that's a win and the President deserves some credit for forcing the conversation.

Got it. Okay. Excellent. Just one last point. As we think about some of the price points on TrumpRx that companies are agreeing to as part of their settlements, my sense has been that those price points are largely irrelevant because the cash pay volume is always so small because our employers will only pay for what the PBM contract is structured by the insurance company. So the insurance will never pay for TrumpRx. Is that consistent with how you look at it from your commercial experience?

Well, I think if we look at the medicines that are going to be there or medicines that we could consider being there, these are reasonably low-priced medicines where the out-of-pocket cash play is manageable for a patient. And all they're doing is forgetting the insurer. And obesity is an interesting one as a starting point. That captures everybody's imagination because -- of course, people living long is very important. Vanity is also a major driver of people deciding to spend a couple of hundred bucks out of pocket. That drives this huge level of noise around direct to consumer. But actually, the scale of how many patients that will impact outside of obesity is quite small. If you are on $30,000, $40,000, $50,000, $80,000 specialty care med, where are you going to -- where does that go without the insurer being involved? And how do you pull the insurer in? Not sure at this point. If you're Amazon and you bought PillPack and you have all these options and you can ship medicines, I don't see you trying to interact with insurers to try and make it all possible. So if it stays cash, if it stays cash, it's going to be lower priced, older medicines or price of medicines that got forced down maybe via politics and other things to be made available. So don't see the issue, waiting to see the big opportunity.

Excellent. Excellent. Maybe last policy topic before we go to more Sanofi-specific topics. Where is your thought process from the recent FDA updates, the weekend e-mails, all that stuff? How do you see that evolving? And do you see opportunities within that?

Well, I just saw, I ain't had it confirmed though that Pazdur has just resigned.

Oh, is that right? I didn't see that.

Look at that? I mean on the news.

Oh my God.

Put that in the podcast.

Yes, I'll take that.

I just read it in the news feed. So somebody will confirm whether it's real or not. And that's just after recently Tidmarsh had gone in different reasons, I would imagine. And so there's a lot of musical chairs going on. And we spent a bit of time with Makary. And I have to tell you, every time I've spoken to him, he makes sense, it's common sense. We want to be making these medicines available. We've been too hesitant. Everything he says is, I think, gives you a lot of encouragement and positivity. But that will be the second -- no third CBER director since Makary, is that right? So that's -- we have to decide what that means for continuity of programming and delivery, and we would hope that it is maintained in the relevant director and things, but it's a lot of change.

What about Vinay?

Well, I mean, as I said, there's a lot of change. There's -- I try and choose my words a little bit carefully, but I think we need a tiny bit of stability. We need -- we have all of this drama with vaccines. We have all of this drama now with CBER. Do we really know what the new FDA looks like and how they operate.

I guess let me push it to an extreme, and now I'm kind of venturing right into some of a core Sanofi base business topic perhaps. Do you see either increased -- meaningfully increased R&D costs or perhaps annual recommendation issues for your flu franchise with some of the stuff Vinay proposing?

The flu coverage rates are down. And I've had my own conversations with us, with Kennedy, with everybody about what this means. I spoke very candidly with Kennedy about MMR and the measles outbreaks and what does it mean? He was very explicit with me. He doesn't see any responsibility in any of that. He sees that it's our job to do our job better. We have the conversation about herd immunity and about the importance of these things. And it just -- it's not a productive conversation. There is stubbornness around some of these subjects, whether they believe they're correct or not. Now we're not in the mRNA, we're trying to be. We're in -- we bought the COVID-19 vaccine from Novavax for really a sweet deal to be fair, and perhaps the last vaccine that will ever be available for COVID certainly in the United States and the only non-mRNA vaccine. Now it's funny with the administration, there is a sort of anti-vax sentiment, there's an anti-mRNA sentiment. There's a few sentiments and then there's the public own literacy on whether they think mRNA, the reactogenicity is too painful, be sick for 2 days to avoid being sick for 4 days. And so for us, we think we may just come through '27 into '28 with a flu COVID single shot that's non-mRNA that may just be perfectly timed given all the drama around it. For everything else, Beyfortus got approved. Beyfortus goes from strength to strength. It won't be far off a $2 billion drug.

Beyfortus, does it fall into Vinay's vaccine category or not?

Well, it's a funny one. I never thought, I'd have some of these conversations, but it falls into the immunization category.

It does?

To me.

To you, but to him. I mean because there's a bit of a political angle to it. Vaccine versus antibody is different treatment.

There is. And I can tell you with Beyfortus, which is for RSV, one of our biggest rate-limiting steps when we were forecasting before launch was our issue was it's not a vaccine. It's a monoclonal antibody. And we did quite a bit of market research. This is just with parents of newborns. And we thought we would have an issue because it wasn't a vaccine. What turned out in the end to be one of the reasons for the fastest uptake was that it was a monoclonal antibody. And the parents decided we can stay out of the fray on the vaccine debate because it's a mAb and really, it's just common sense. We never thought people would grasp any of that. There's a big debate and we saw it when we were coming through with the guidelines and whether we'd be included even in the debates in the last round of ACIPs that never happened was where do mAbs fit. And they seem to be lost in a good way so far.

You don't want to be in the headlines for this stuff. That's great.

I don't -- I think if more babies get protected because we're out of the headlines, then that's better for all of us, right?

Great. No, no, that's fantastic. Okay. So it doesn't sound like -- I think on your vaccine business broadly, including Beyfortus, it sounds like headlines may not be ideal, but you're not as worried. You sound reasonably comfortable with that.

I don't think any of us like that they have some commitment to public health, the drama around choose for yourself because that's not really what I think should be coming from HHS. I think there should be -- it's the duty to try and protect as many as possible. The debate around the safety of vaccines is always a handful of patients over here or healthy people that had a tragedy versus the millions protected. And it will never be that square -- we can never square that circle for the people that don't won't spend time to read it. If you just want to be on Facebook, you're going to get what you get, and we'll see where it goes. I can only talk about the Sanofi impact. On RSV, we're doing great. In flu, flu coverage is down, but market share is up with our high-dose flu. The over 65 still want to get protected. They still want the best because they're the most at risk, in the sort of 40 to 60 range, people are saying, you know what, maybe I'll take a season off or maybe I won't bother or maybe it's not as bad as I thought and I will -- I may be sick or I may not. And that's where we see the volumes changing in who's stepping forward. I don't think that's good. I think it is what it is. I think by '27, we have a flu COVID and it's a 2 in 1, those headlines beat coverage rates. So that's it.

Got it. So maybe turning to pipeline, and I know we have your former Head of R&D here as well. So I'll keep looking at you and him. I'll gauge 2...

So Reeds in the house.

I'll gauge 2 body languages on each question now. But tolebrutinib, PDUFA coming up, there are a few set of liver cases and they're real liver cases. I guess my question is, what has the regulatory conversation been so far? And what's the expectation, both on approvability and on label?

Yes. I think the conversation while everybody fixates on the PDUFA, we were going to get an accelerated review. We're now back on the original time line, if you like, for December 28. I think what John, the team, myself, but to a lesser extent me, put forward 5, 6, 7 years ago was to do something first-in-class, best-in-class in the secondary progressive MS that has no treatments. And we didn't think it to be without consequences. We would hope that it wouldn't be. We had some DILI in the program. We changed the protocol. We went to weekly monitoring for 90 days. And we had no Hy's Law or significant irreversible DILI after that point. So we know we can manage it. The question is, what does the FDA think about the risk benefit. And we simply don't know. This is a huge unmet need, and we delayed disability progression by 30% in an area where there are no drugs. So that's pretty outstanding. But the FDA will, of course, always want us to show that it can be managed safely. Perhaps in a previous regime, that would have been an AdCom, right? That would have been -- that's where you bring the patient group -- the patients. The patients will tell you because they tell me, we would take that shot every day of the week because what's our choice from cane to wheelchair. We want whatever we can take at that point. And as long as we understand the risk and we monitor it, monitoring is not uncommon in MS. We would take it. That may not be an option for us. We will go through -- they've asked for the GEMINI data to look at the safety and efficacy, which is our relapsing remitting data. We didn't beat Aubagio on relapsing one event every 8 years versus 1 event every 8.5 years. But on disability progression, we were significant in that group. So there should be enough for them to see. They also -- we also have the primary progressive data just around the corner imminently. And what will that tell us versus fenebrutinib and their noninferiority, we're against placebo, so we may win. Where does it leave us with the FDA? Active conversation. We're already now then on our third head of [ CDR ] as part of that CDK, which the office is meant to be the continuity. And so we hope that's...

So is the news you broke or is that a good news or bad news?

Well, it depends if we get approved or not. I think the systems and process and the rigor is the same irrespective of the head of the office. I guess if we felt like we needed to appeal or something else, you'd rather have some continuity. Right now, they have the data. We've very open conversation. We have to get to the label conversation and get to PDUFA and see where we go. I remain optimistic on it.

Can I summarize how I'm hearing this?

Yes.

It sounds like -- the way I'm hearing it, and I'm not covering Sanofi analysts, but the way I'm hearing it is it doesn't look like this is a situation like Biogen aducanumab where leadership level at FDA was getting involved in overruling a decision from down below. It sounds like -- you said you're reasonably comfortable on how it's tracking. It sounds like the lower level review is tracking in favor. So you're actually not as worried about the leadership having the stuff in that stage.

Yes. I didn't say it was tracking in favor. I just said it's tracking. And so the -- I don't think it's as sensitive as some of those other examples that you gave. But it's our job, my job to track alongside senior leadership just in case a candid compensation is needed. We will see with the office where they get to. So we have an unmet need. We have incredible efficacy data, and we have to be managed safely through a REMS for the first 90 days at least. That is not a sort of -- that's -- they have to weigh that up and how they feel about it. I don't think that changed. When they -- we were on track and then they ask for the GEMINI data, I think it's because they generally are trying to find how to properly characterize the population. For me, that is patients who haven't relapsed for 2 years and are still progressing. That's quite a big population. That's 25% to 30% of the MS population. So I can't tell you positively or negative. I can just tell you, the dialogue is as professional as it's always been, and we'll wait and see what the politicians...

Was the liver data better in GEMINI versus -- or it doesn't matter. It depends on when the amendment was done.

It's after the amendment, everything got done.

Excellent. Paul, over time, one of the things I found is you're very good at like first principles way of thinking about commercial opportunities, almost like a very reductive way of thinking. How do you think about the opportunity here for tolebrutinib?

If we get through and we get no lapses for 2 years, and we're in the 25% to 30% of the population, that's SPMS. I told this to a few people already. I'm not interested in launch uptake. I'm interested in perfect REMS, perfect REMS for the first 12 years -- 12 months. And then everything we learned to do white glove thereafter. These patients need the medicine. These patients are valuable to us, of course. We can afford to do perfect REMS. So I think it's extremely valuable. We're the only drug that's ever shown anything in this disease. We're the only drug. If the other BTKIs have a go, one may, it's 5 years late. So we have the opportunity to do it correctly and be a multibillion-dollar drug in SPMS and do great things for patients. Got to get the right label, got to get approved, yes, got to have perfect REMS, yes, more than manageable if we get there.

Okay. Has the company put out numbers on this?

Well, I personally put out numbers. This is the IR...

Can I put out -- throw a right number out? $5 billion plus?

Well, I think that we -- I think if the label is broad enough and we get primary progressive, I think you could be talking within that range. But we need perfect REMS. I've been around long enough in MS to see when you get a case of PML, how people's attitudes change so fast on a PML. You were the golden boy or girl of the drug treatments without a PML. As soon as you got one, you were quickly put in the class with everybody else. I don't want to have any of the drama around DILI. That's why being perfect on REMS and monitoring will be so important. And I think that can be done. Certainly, in secondary progressive, $2 billion, $3 billion. If you get primary and perhaps over time, you can creep a little bit earlier, maybe it gets towards the numbers that you're saying. I'm not worried about the peak. I just want to get approved. After that, we will see what we can do and we'll do it skillfully.

Fantastic. What about frexalimab sticking to sort of like the same market, your thoughts on sort of when is the Phase III readout? And what type of a commercial opportunity is that in the context of OCREVUS that's already out there?

Well, I think OCREVUS has done a great job, but it really has no impact on disease progression, great on lesions. The hypothesis you know around the CD40 with frexa is that it acts both on disease progression and lesions. We can argue the efficacy data in lesion is so good that it's sort of a nonevent. The question is really, do you have an underlying impact on disease progression. I get emotional when I talk about frexa. So the bottom line is if you work on progression and lesions, then that's sort of the holy grail. For a while, we've been thinking about putting tolebrutinib with frexalimab. The more we understand about acquired innate immunity with CD40, the more we think we can do something for those that are progressing on top of the lesion, in which case, it has a huge opportunity. Don't forget, we're also going to take it into type 1 diabetes, and we have a good opportunity there to try and protect as much of the islet cell function as possible that's left. So we think it's a great all rounder, but it may be the only drug that does relapsing remitting and disease progression safely without the risk of infection. And I think that it has a huge place.

Right. Okay. Excellent. And there was a couple of cases of liver enzymes I saw on this, which was kind of unusual, but I didn't know necessarily if that's drug-related or not.

Well, I don't think we do either. I think it resolved. So we leave that for what it is at the moment, and we're continually adding more patients in the study. So I don't think it's -- at least from what we know and specific to the medicine.

I want to move on to the oral TNF-1R, and I want to move on to that because it's probably the only drug in your pipeline where you ever sent me a paper to read ahead of a meeting. So where are...

What was I thinking?

So where is your thought process on that program right now?

I really like the oral TNF program. It's a difficult needle to thread. And when I joined the company, they told me we've cracked it. And I said, really, they said it took us 35 attempts. And I was like, I'd have killed that 34 times ago, but as you managed to do it just in time, great. I love immunology. I love immunology marketplaces. They're terribly misunderstood, in particular, by sell side. People really don't read the facts. You know the facts. Why can you have so many blockbusters in immunology? Why can you have so many blockbusters in psoriasis? Why can you have 3 IL-17s that are all blockbusters? Why can you have a fourth IL-17 that didn't work, but should have worked? Nobody -- the heterogeneity of patients, the highly symptomatic burden, which means they show up so they can get their medicine changed. The fact that they go from needing anything to suddenly obsessing over clear skin means they're constantly pushing efficacy. These patients are the most important to work around. And then when you look at that, look at the Sanofi approach, it's a bit different to other people. We've stacked drugs and mechanisms on the same disease, asthma, AD, UC, CD, COPD. And we've done it because every drug in immunology, maybe with the exception of the TYK2 has been a blockbuster. Everything becomes a blockbuster for the reasons that I mentioned, patients are unhappy, motivated, symptomatic, mobile, every time. And often -- sometimes I have this conversation with sell side and they look at me like I'm crazy. But the truth is just look at what happened in psoriasis and look at how it evolves. It evolves from TNF to IL-12/23 to more selective to 23 to 17 and the biologic eligibles keep going like this. They keep going like this, then it moves to longer interval, then it moves to oral. And then suddenly, you have biologic penetration of 40% or 50%. And suddenly, it's been driven by all of those moments. And that last moment is oral. And that last moment, if you get it right, takes you from mild to moderate -- sorry, from moderate to severe to mild to moderate. Teze is what, EUR 2.5 billion and it's famous for being not as good as anything else. You pass through it on the way to biologics. As biologic penetration increases, and in AD, it's like 12%, 13%. Dupixent will be EUR 16 billion this year and 87% of the patients that should be on Dupixent, on it, 87% and will be EUR 16 billion. People laugh, by the way, when we said we do EUR 10 billion at some point back in '19. Oral is a driver of biologic penetration. It's a step through for payers. It's the pre-injectable for patients. John is going to have a 23 that he's going to force everybody to take an oral on the way there. But they will be blockbusters because they fit comfortably in what physicians do and what patients want. The efficacy doesn't have to be perfect. If you're a stand-alone asset like a TYK2 and you push it and you start to have safety or other issues, you end up with EUR 80 million sales in Q3. And that is not where it needs to be. That's where they went wrong, I think, because that's jokes. For us with oral TNF, our ACR 50s and 70s were great in RA. We will push into RA as mono. We'll push with fixed-dose combinations with other orals because we think we can reduce inflammation, target cytokines. And even in RA, which has very few alternatives still after all these years, it sits very nicely. We did a proof of concept in psoriasis. We never thought we'd win. We did it because it was the first place to get efficacy data fastest because skin is skin, and we didn't have to wait too long. So it's going to be a big drug. I think not as big as I would have hoped. Because at the beginning, I thought this could be mono pretty, much everywhere. It will have a role in IBD. It will have a role in RA, maybe PSA, maybe AS, but unlikely in psoriasis.

Got it. I guess one question I've asked, John, previously, I've asked you separately as well is based on some of the findings from VEGA trial, some additional combo work that's ongoing, it looks like a TNF IL-23 combo. If it makes sense on an injectable, it should make sense on the oral Sanofi injectable -- oral IL-22 on the John side. Has that been contemplated? Or are both sides more interested in having a fully owned asset in-house?

I think everybody always wants a fully owned asset in-house, and we have our own 23s. I'm sure John has his own oral TNFs. But I think we're all open-minded to know what could come faster and how that could be created. But it takes both sides to want to do that. I think the -- I would say the patients need it. I think we saw that study, and it surprised everybody that 1 plus 1 equals 3. That study, you should have in mind when you look at lunsekimig, IL-13 plus TSLP, it's 1 plus 1 equals 3. When you look at the FeNO drop presented in DC at ATS in '23, the FeNO drop was 3x what it was for the TSLP studies alone or for the 13 studies alone. And so we know 1 plus 1 equals 3. We also know in the beautiful world of bispecifics, they either give you greater than the sum of the parts or they give you ADAs and they fray...

They're also greater than some of the parts.

They're also great. It's true. On safety, they give you greater than some of the parts. And that's -- we found that on a little bit of that journey ourselves with the nanobodies looking at TNF 20 -- sorry, OX40 as well as other things to try and make sure we had all the options. I think we are in a good spot with TSLP13 because you sort of know early whether you have an issue. And if 1 plus 1 equals 3 with lunsekimig, it will be the definitive for efficacy in asthma. It may make it into COPD. We'll see. We're going to do the study, and it may make it in AD. Remember, TSLP worked in AD, but not well. 13 worked in asthma, but not well. And so we may end up with this 1 plus 1 equals 2.75.

This program is not Regeneron partnered, correct?

Yes, no.

That's fully owned.

No, we only have the itepekimab IL-33. We had one great study this year. We had one disaster study. By the way, our Gen AI experts tell us that we failed with -- in the second study because the background rate of exacerbations and infections in the countries that had -- still had COVID restrictions meant that they were not getting any infections. And that was a miss on our part. Should we have known? Maybe, but it means that we go confidently to the FDA to talk about the third study. Important for us to try and get the IL-33 there because with the dupi rebate, we can deploy, we should be the winner of the IL-33s. So whether you're Roche with 2 underwhelming studies, whether you're AZ with a failed Phase II, trying to take teze into Phase III, you'll have to step over our rebate wall. And that's harder for them if we can get there fast enough before LOE.

Where are you with Lunsekimig? Would this -- the IL-13 TSLP bispecific, would this be done head-to-head versus Dupi?

We don't need to do head-to-head.

And I guess why not?If you have the rebate.

Biologic penetration is so low. You don't need to do it. New mechanisms expand the market. They're used, they're covered, they're reimbursed. It's not an issue. And we don't need to do it. And sell side will put the effect size up against each other anyway and say we can't really do this, but here it is. And that's what you get all the time. We haven't covered amlitelimab, but amlitelimab is a classic for that. The OX40 ligand, which we specifically chose because it doesn't have the safety baggage of the OX40 is we do the study, COAST-1 hits all primary and secondary, COAST-2 coming out in January. Effect size versus Dupi is less. But I can tell you, if we did the Dupi studies now, you get a similar outcome because the number of biologic experienced people entering the studies is now much better, 20%, 30%, much higher rather than when Dupi was doing its studies. So amlitelimab is -- we haven't spoken about it, but it's perhaps one of the biggest medicines that we will have as a company.

Right. Can I just ask you, when is the fastest Lunsekimig could be on the market?

Well, we're going to go into Phase III. And so you're looking at 3, 4 years, I guess, by the time you're approved, but in plenty of time.

So 2030 or so?

Before Dupi LOE, of course. And most of the medicines we've been working on in mid- to late stage have been 12 shots on goal to get 2 or 3, $2 billion, $3 billion, $4 billion, $5 billion drugs. Dupi is going to be huge, but we only get 50% of the profit. So we only have to cover half of it. Our job is to see can we grow EPS through that time. Maybe we can. We'll certainly be more profitable. Adding Phase 1 is now is what's more interesting because what we do 2035 onwards is where we'll create more value. That said we buy Blueprint because Ayvakit is a blockbuster next year, and that underwrites the growth. We haven't got to it, but we'll be mid- high single-digit top line CAGR for the next 6 or 7 years. Think about it because we have no Dupi LOE, earliest is '31 U.S. '33.

Mid- to high single digits.

Well, imagine, right? It depends a little bit on where we get to with Dupi, but Beyfortus is going to be a multibillion dollar drug. ALTUVIIIO is a blockbuster already. Ayvakit is going to be a blockbuster. We don't have the LOEs. We have no LOE to them. We went through all of that. So we have an option to be able to -- and the amli launch, I know I prompt you twice to talk to me about it, you don't want to talk about it.

I want to start -- okay, let's go down this path.

Well, we only have 1 minute 45.

No, no, we can go past. For you, we can go past. OX40 TNF bispecific, that HS data to me looked probably one of the more interesting data sets I've seen at Sanofi.

Yes. The data is incredible.

So how important is that HS opportunity? And could that even bigger than amlitelimab, that agent...

Well, we think that data is most likely if it stays consistent through Phase III, it's better than BIMZELX on tunnel drainage, on resolution of the fistulae and everything else. So I think we feel extremely good about that area if it holds true. We had a few goes at bispecifics. That one seems to be the one that gets there because you've got more -- having more specific cytokine targeted -- single cytokine targeted therapies like IL-17, I'm not sure. And study design matters greatly now given the moon likeness. So it's becoming much -- in immunology...

Are you running head-to-head versus BIMZELX or you don't need to?

We don't need to. Why? Physicians will see the difference. Every new entrant, nobody is perfect even on BIMZELX. So the patient will show up, I'm doing much better than I ever thought, do you have anything new. That is the conversation that goes on and patients switch all the time. I told you, heterogeneous underpenetrated, highly mobile patients when they even doing better than they ever dreamt, still want more. That's how it goes. That's the PASI 100. So if the data holds, I think we have an excellent bispecific. It will be 1 of 2 winners...

Do you think this is bigger than amlitelimab?

I think HS itself is bigger than people realize. That's why everybody piled in. So we could be a multibillion dollar in HS. I think if we get it right in AD, people really don't understand the opportunity in AD. By the time we launch it, biologic penetration in AD will be 18%, 19%. 81% of patients not on treatment. There's lots of reasons for it. But this will be the only medicine with a chance of coming off medicine, to be drug-free remission. That's the goal. And the market is way big enough for us to make a $2 billion, $3 billion, $4 billion, $5 billion drug from that. We never expected in COAST 1 to get Q12 as a starter. Q4, we hoped. We get Q12, it's reproduced in COAST 2. We have the only drug you can start and give an injection 12 weeks later. Then another -- the second injection, you are going to see a meaningful difference, slightly slower onset. So the 9% of patients that come in on fire needing something, we're not going to compete there. The other 91% of patients in first line are like, I think maybe I need to do something else. Well, I'll tell you what, and we'll get the SHORE study, by the way, on top of topical corticosteroids upcoming. They'll be the ones when the doctor says, I'm going to start you. They say, this is how it goes. I don't want to be on an injectable. Well, this is going to make you feel better. We'll start you on this because maybe after a year or 2, if you're stable, we can withdraw it. And we're the only drug because of the up regulation in T helper cells that can offer some homeostasis in the longer term. 70% of patients that stopped after a year were still drug-free, disease-free 2 years. So we know that's an offer. It may only end up being 20% of patients. It may not end up being a lot. But as a promise and initiation for new patients, it's a reason to differentially start amli.

And can you remind us, Amgen will be out there in the market as well for a similar offering, but the dosing schedule difference and the tolerability difference?

Well, before we -- back in '19, we knew we had Dupi and we were wondering what could compete with it. Dupi will grow to its last day. And we looked at Kyowa Kirin's OX40 and decided that derms didn't become derms to get a phone call at midnight saying I've got a temperature. That's not why they became derms, but they want to call after 5. So we knew the fevers and chills are multiplying with the OX40. And so that was going to be -- you're too young for grease, but that was my grease joke. And then -- and so you have -- John is smiling. You'd have been in grease, John. And so we knew you can't have that profile. We knew -- they knew that once we went for longer interval, they has to push interval. To push interval, they had to push dose. They couldn't manage the side effect profile. Nobody is going to really use it. It will get some use because every drug gets used in immunology, right? It may even be a blockbuster. It won't be in the same league as amli just because amli will be a much cleaner profile, a real Q12 with a chance of drug-free remission. That gets exciting. Everybody will want a new mechanism, much like the TL1A in UCCD.

I want to end on that.

I knew you did.

Can I just ask you, I remember this -- was it a Board meeting or a leadership meeting at Sanofi where you said, hey, there's a generic pharma company with the TL1A in its closet. What does that look like? And you guys subsequently did that deal. My question is, do you still -- what's your temperature on that right now? Competitive landscape is evolving a little bit...

Well, we look -- we -- like everybody was looking at Prometheus, but it was too toppy to do that sort of deal. And then everybody was looking at Roivant stroke, Pfizer stroke, Roche. And so I'm not sure who got all the money in the end. And we wanted to be in the space because we've done the work, and we knew TL1A was really a credible mechanism, but we were never going to pay those prices. And we knew because we were sort of well informed that Teva had a TL1A. We knew Teva on a different journey. I know Richard Francis well, as you know. And they didn't want to give it up entirely because that was a source of breakout performance for their own share price and value creation. We wanted to participate in it, but didn't need to take a massive risk. We paid $500 million upfront and a share, and we booked sales in the big market. So it made sense for us. It turns out, it's perhaps the most potent. The data we've seen so far would say we may have got the winner. Well, that's a bit unexpected, but that's great. And we're already in the Phase III on UC. I think that's going to -- with all the things that we do, that could be a $5 billion drug, and we have no idea where else that drug could go.

Have you guys said that, $5 billion for this?

We're not saying it. I'm saying it could be, I'm not saying would be, but I'm telling you, honestly, I feel like I'm being deposed half the time. My job -- I get accused of being optimistic and bullish on the portfolio. I'm extremely excited about what we can do with drugs that I know how to make the market. You can -- I'll be found out on science. Some things frustrate me, frustrated to miss on an IL-33 study, frustrated not to get a home run upfront on oral TNF. That's on me, and I take that. Building markets, Dupi, done before with Cosentyx, even launched REMICADE, building markets, now that's what we're good at. The TL1A, if the data holds, we will make it big. Amlitelimab make it big. Tolebrutinib, the same. Lunsekimig, we'll take them all by surprise. And brivekimig HS, all by surprise. We're good at that. I take it on the chin, we will get scientific failures. And that's -- I do my best to make sure we don't. That's where we still have to prove to the Street that we know what we're doing. You look at our commercial performance, we're virtually double-digit growth on the top line on $40-plus billion this year. One of the fastest. We know how to do that. Now where I get caught out is sometimes we just don't make it. But if we get there, then we know what we're doing. And I think Richard Francis has a winner in the TL1A. And I would rather it was ours, but he's a good enough guy. We will share it with him and see how far we get. I think it could -- if we get -- if it holds the profile, it can be the winner of the TL1As. I think that's pretty straightforward.

Outstanding. Well, I'll end it right there. Thank you, guys, all for joining.