Sumitomo Pharma Co., Ltd. (4506) Earnings Call Transcript & Summary

I am Hiroshi Nomura, President and CEO of Sumitomo Pharma. Good morning, everyone. Thank you very much for taking time out of your busy schedule to participate in our financial results briefing today. Thank you very much for your continued interest in our company's management. As you have already seen in the materials, FY '22, is the final year of the current midterm, and we have fallen far short of the targets of the Mid-term Business Plan announced last year. We are truly sorry about that. Loss of exclusivity for LATUDA will be a challenge for us in the future. And we will face that challenge as a group. And I would like to ask for your continued guidance and encouragement. I would like to provide an explanation based on the materials. Page 3 shows topics in FY 2021. As you can see at the top of the page, although revenue increased year-on-year, owing to lump sum revenue from alliance, profit decreased due to an increase in marketing expenses related to Sumitovant. Here is a description by segment, but I hope you will see that later. Next, Page 4. Revenue was JPY 560 billion. Core operating profit was JPY 58.5 billion. Operating profit was JPY 60.2 billion. And net profit attributable to owners of the parent was JPY 56.4 billion. The forecast figures are shown on the far right up to the core operating profit. The results were not much different from those figures. Changes in fair value of contingent consideration and other nonrecurring items were revalued at the end of the fiscal year. So there is a slight difference. The largest difference, which cannot be seen in the table, is the nearly JPY 25 billion foreign exchange gain on financial income and expenses, owing to the difference in exchange rates on March 31, the end of the fiscal year, which resulted in a large difference from the original forecast. The result is that in terms of net profit attributable to owners of the parent company, the figure is almost the same as last year. As you can see here, SG&A expenses, in particular, increased by JPY 43.8 billion. As you can see on the far right is that expenses related to Sumitovant, although to some extent, this is within core operating profit as expected. Of course, SG&A expenses decreased in Sunovion and other areas, resulting in an overall increase of JPY 39.8 billion. In any case, the current situation is characterized by the large impact of the exchange rate. Next is revenue in Japan. As indicated at the bottom of the right-hand side of the page, the impact of the NHI price revision was JPY 7.4 billion. Considering this, unfortunately, sales decreased year-on-year by JPY 2.6 billion, although we managed to make up for this in volume. Next is North America and China revenues. First, North America. LATUDA decreased by USD 130 million. This, of course, was partly due to the downstream inventory, but in the end, due to lower average prices. So the revenue year-on-year decreased. As for ORGOVYX, MYFEMBREE, RYEQO and GEMTESA, the results are listed here. Others year-on-year increased by $314 million, which was a lump sum payment from Otsuka Pharmaceutical. In China, MEROPEN and Others are still increasing. This is a summary of several data already published by Myovant. ORGOVYX was launched in January 2021, and you can see that number of patients have been gradually and steadily increasing since then. And the number of patients in the fourth quarter FY 2021 increased by more than 30% from the third quarter. The payer coverage in the middle of the page shows 82% of commercial insurance and nearly 100% of Medicare Part D. I think we are almost at the point where we have enough coverage. The characteristics of ORGOVYX, as shown in the last bullet point, have been highly appreciated by prescribing physicians with 73% of prescribers satisfied with the product. This slide for MYFEMBREE is also a summary of what Myovant has published. The market share of new prescriptions for GnRH antagonists for the treatment of uterine fibroids in March 2022 is shown in the chart. But since the only competitor is ORIAHNN, this is a comparison to that. But at the end of March, MYFEMBREE accounted for 59% of new patients, which means that it has surpassed the existing drug. The MYFEMBREE's coverage of uterine fibroids is also very high at 93% with private insurance. At the bottom of the list, we are talking about doctor satisfaction with ORGOVYX earlier, and this is 87% of the obstetrician-gynecologists' intention to prescribe the product. We understand that this is also a very highly appreciated product. This is the marketing status of GEMTESA. The table on the top shows the number of prescriptions in December, its share and the share and number of prescriptions at the end of March, where the prescription share is gradually increasing. The 6.4% at the end of March, for example, the rest of share is where Mirabegron is being prescribed. So we will try to increase our share as much as possible. The second table shows the coverage for private insurance, which was 34% in January and 56% at the end of March. Medicare Part D was 24% in January and 31% at the end of March, which is slower progress than ORGOVYX and MYFEMBREE mentioned earlier. But this is because Mirabegron is the giant in the market, and to increase coverage while Mirabegron is in place will lead to a large discount being demanded. We are trying to balance the situation as we increase the coverage. This is a comparison by segment between the previous year and the current year. I will omit the details. Next is financial forecasts. Revenue is JPY 550 billion. Core operating profit is JPY 30 billion. And net income attributable to owners of the parent is JPY 22 billion. For the final year of the Mid-term Business Plan announced last year, these are a significant decrease from JPY 600 billion in revenue and JPY 60 billion in core operating profit. We will see the differences later. Compared to the previous year, the revenue decreases by JPY 10 billion here. In Japan, as you will see later, we would like to manage to increase the volume in spite of the termination of f REPLAGAL sales and the effects of the NHI price revision. In North America, foreign exchange gains are positive, JPY 24.5 billion, although negative in the dollar. In China, we expect VBP, volume-based procurement, application to MEROPEN and then LATUDA starting around August. So we can see such an impact. As for SG&A expenses, excluding foreign exchange, the increase is about JPY 10 billion. But as you can see in the lower right-hand corner, the increase is mainly related to Sumitovant. In particular, there's JPY 21 billion in other income and expenses here, and some of you may wonder what this is. We've got a priority review voucher for pediatric congenital athymia, and we've got about JPY 10 billion by selling it. In addition, we will take measures to improve profit and loss, and we are hoping to bring the total to JPY 21 billion. In that sense, core operating profit is JPY 30 billion. Other nonrecurring items include a negative JPY 5.5 billion. As you all know, LATUDA will reach its loss of exclusivity in February 2023, and we are planning to reorganize our sales structure. So this is factored in. Just to mention a word about LATUDA sales structure. Sales reps will continue to promote for as long as possible. It is positive from a sales and profit perspective. Since LATUDA is a detail-sensitive agent, we have conducted a simulation that shows that we can maximize profit by detailing the products as much as possible. We will work on this in this fiscal year. As I have mentioned many times, this is a revised part of the financial objectives of the Mid-term Business Plan announced last May. I cannot go into too much detail because there are listed companies, but sales revenue in North America shown in orange is significantly lower than we had expected, partly due to COVID-19. The core operating profit on the right is also where North America had a large impact in terms of profit. We tried to secure core operating profit of JPY 30 billion by adding up these costs with other income and expenses such as the sale of the voucher mentioned earlier, other profit improvement measures and a slight decrease in research and development expenses. Page 15. Here is a comparison by segment between FY 2021 and FY 2022. I don't have anything special to add here. But this year, we will start selling neuro rehabilitation device under the Frontier business, which is included in Others. I would like to add that the small amount is included in the sales. This shows revenue of major products in Japan. REPLAGAL has been transferred to Takeda Pharmaceutical, and it is 0. The impact of the NHI price revision will be JPY 12 billion. So although the volume increases, revenue of Trulicity and Equa-EquMet are negative compared to the previous year. As for LATUDA, I would say that it is growing steadily. Next is North America and China. In North America, this fiscal year is the last year for LATUDA. Compared to the previous year, the revenue decreases by USD 90 million. But if you look to the right, you will see an increase of JPY 11.7 billion, owing to the impact of foreign exchange. And RETHYMIC in the dollar, it is $3 million and expected to be USD 48 million in FY 2022. We are expecting to be able to perform transplant surgeries on about 20 patients. ORGOVYX, MYFEMBREE, RYEQO and GEMTESA and others are collectively USD 601 million since the breakdown cannot be disclosed. Although the year-on-year decrease is USD 50 million, considering the lump sum payment of $270 million from Otsuka Pharmaceutical, please understand that the actual sales of these items are increasing. As for MEROPEN in China, sales decreases to JPY 13.1 billion. The VBP application will significantly reduce the price and volume of drugs. Generally speaking, it is said that the generics will dominate about 70% of the market. Concerning antibacterial drugs, we see 60%. So we are trying to maintain our presence in the rest of the market in China until lefamulin is released. Next is regarding shareholder dividend policy and return policy. We plan a dividend of JPY 28 per share for FY 2021, and the same dividend is planned for FY 2022. As for research and development, I don't have much to add, but the submission on the far right for MYFEMBREE in the U.S. has a PDUFA date of August this year for completion of the review. Originally, the PDUFA date was May 6. But as I am sure you are all aware, we received a letter from the FDA in early April stating that there will be a deficiency. After that, we were asked to submit additional data. And when we did, we were told that it would take a bit of time to review that data. So it resulted in a 3-month delay. Next, research and development progress. The second on the slide, relugolix, was approved for prostate cancer in Europe in April. Then we have licensed the European rights to Accord Healthcare. Accord Healthcare is primarily a generic company but also offers about 6 brand name products and is also focused on oncology. Thus, this company was chosen. TP-0184 is the third one from the bottom, but its development has been discontinued. In the results section I mentioned earlier in terms of the fair value of contingent consideration -- or below that in terms of other nonrecurring items, there was a positive impact in the fair value of the contingent consideration. And then below that, there was a negative impact of the impairment. It is not that large in value. Regarding the second one from the bottom, MYFEMBREE, I have already mentioned it. Page 22 shows ulotaront and SEP-4199 jointly developed with Otsuka Pharmaceutical. Regarding ulotaront, as you all know, the situation in Russia and Ukraine has had a major impact on the recruitment of patients for the clinical studies for schizophrenia. And we are currently discussing and formulating countermeasures with Otsuka Pharmaceutical. Currently, we have stopped recruiting new patients in Russia and Ukraine. And we are now working with Otsuka Pharmaceutical to conduct studies in other countries, mainly in the United States. It has been decided that the second indication will be adjunctive therapy for major depressive disorder, or adjunctive MDD. Otsuka Pharmaceutical will be in charge of conducting the studies. We have been told the IND will be submitted this year. I believe that we are currently in discussion with Otsuka Pharmaceutical regarding the third indication, but we have not reached yet a final decision. However, we will be able to negotiate with them during this fiscal year as to what indications we will be able to develop. Then there is the ongoing work on SEP-4199. Here are major events and target for FY '22. There are many, but the second one from the top is that the approval of relugolix for prostate cancer in Europe has been achieved. Regarding the product launch target concerning MYFEMBREE in FY 2022, I think I mentioned that earlier. Here is the product launch target for the Frontier businesses. In FY 2022, starting from the top, sales of neuro rehabilitation device for hand and fingers paralysis will be generated slightly, which I mentioned earlier. Relieving BPSD, behavioral and psychological symptoms of dementia, which will be handled by Aikomi, will also be promoted seriously to nursing care facilities. The mental health VR content is to be sold by BehaVR, a U.S. company, and we're assuming that the revenue will be split 50-50 with us. After FY 2023, you will see these programs. As I mentioned earlier, we expect sales to be generated this fiscal year, and this slide introduces some neuro rehabilitation device information for hand and fingers paralysis. I have briefly explained the financial results for FY 2021 and the outlook for FY 2022. After this, I would like to take your questions. Thank you very much.

Yamaguchi, Citi. First, let me ask you about ulotaront. We were told how to address the first indication. Described in clinical.gov that the top line is at the beginning of next year. With this response, should we still think that it's likely to be a bit of a step back? Or is it possible that the response will be enough to make it possible?

Thank you very much for your question. This is Toru Kimura, and I will answer your question. At present, we have not been able to analyze the details of how long the delay will be or what will happen. But we expect that there will be a slight delay in terms of the progress of the clinical studies, even in terms of its completion. However, as I explained earlier, we have not changed our plan in terms of the product launch in FY 2024.

The next one is adjunctive major depressive disorder. And the third one is under consideration. But I was wondering if you could give me an idea of the size of the market for MDD and schizophrenia. I think that schizophrenia is not a big market. And there are many drugs available, and this compound will be like an entry in this area. I have an image that the market for AMDD is not very big. What is the ballpark size of the market?

I will continue to answer. In fact, it is a compound with a completely new mechanism of action, including schizophrenia. So I cannot give you any figures on how well it will be accepted in clinical practice, especially for adjunctive MDD because we are still in the process of conducting clinical studies to confirm this aspect of the compound. However, I would like to just mention that in general, the number of patients with MDD is many times larger than the patients with schizophrenia.

I understand. Let me ask one more question. When will the second trial of Phase III study of SEP-4199 be conducted?

I'm Yoshiharu Ikeda. I will answer. We are currently conducting the first trial of Phase III study, and the second trial will follow. So we are aiming for approval in the late 2020s.

I understand. Also lastly, in the overall section, you mentioned that the difference from last year's Mid-term Business Plan is quite large. I think it means that the U.S. sales are not going as well as expected. But next term, LATUDA is going to face the cliff this time. Regarding this, the next fiscal year is the next fiscal year. But I wonder if you will further curb costs and put in place a system to protect profits. Or do you see it as inevitable that a major decline in short-term performance will be unavoidable with the direct impact? I know that profits are a little low this fiscal year as well before the cliff comes along. But could you please give me some guidance as far as you know what your plans are for the next fiscal year?

Thank you for your question. In order to overcome the cliff of LATUDA, we have been trying to cover the gap with napabucasin and products from Sumitovant after the abandonment of napabucasin launch. I do believe that the potential of Sumitovant products have not changed at all. Unfortunately, the market did not grow as much as we would like -- we would have liked due to COVID-19 and other factors at the time of launch of these new products. But I believe that they will become products that will support the backbone of our company in the future. However, it was a bit off, and I think that is where it differed from what was expected. As you pointed out, in FY 2023, we expect that sales of LATUDA in the U.S. will be smaller. So from the standpoint of profit and loss, we will do everything we can as a group, as I said at the beginning of the presentation. We are now in the process of planning our 5-year Mid-term Business Plan starting in FY 2023. And a major issue for us is what we should do in order to achieve growth from FY 2023 onward. This is as you have just asked. In this context, we will consider various possible measures to reduce operating costs as much as possible. In this context, we are working on the growth of new items and the development of ulotaront and SEP-4199, which we have just been working on with Otsuka Pharmaceutical. We are also looking at the pipeline that are in the early stages or preclinical stage that may not be certified at this point. But we are trying to make a scenario where we can somehow grow them from FY 2023 onwards while implementing measures a little ahead of schedule this year to ensure that we operate business properly over the next 5 years. We are currently in the process of considering various measures within the company.

Hashiguchi from Daiwa Securities. First, I would like to confirm the status of ulotaront. You mentioned earlier that the detailed analysis have -- has not yet made to see how it will be delayed. Judging from the content of Page 23, may I understand that it is becoming more difficult to obtain top line results in the second half of this fiscal year, which you mentioned 3 months ago? Also on Page 24, you mentioned earlier that you have not changed the launch plan for FY 2024. But what this means is that at this point, do you have a certain feeling that you'll be able to meet the target in time? Or is the possibility of a delay increasing? Or is it better to understand that the possibility of delay is increasing, but it is not yet clear when the revision should be made, so you're not revising the plan at this time?

Thank you for your question. As I mentioned earlier, it is true that the progress of the clinical studies are currently behind schedule. But as a result of a detailed review of the future process, we have found that there are several areas where we can shorten the time frame compared to the original plan. We have, therefore, decided not to change our launch target for FY 2024. Let me explain that it is a little different from leaving as it is because it has not been evaluated.

How do you feel about the timing of the results of Phase III studies?

It also depends on how the new site will be set up, but we expect a slight delay in this area. After that, we are in the process of seeing where we can shorten the time in the way I mentioned earlier.

Second, I would like to talk about the Mid-term Business Plan announced by Sumitomo Chemical in March. I think the core operating profit of the Pharmaceutical division was planned to be JPY 73 billion in FY 2024. I believe the slide showed that the rationalization, efficiency efforts and fixed cost difference will have an impact of about JPY 80 billion compared to FY 2021. Conversely, the plan is that profit will not be generated with streamlining and fixed cost differentials, which will become effective from now on. What is Sumitomo Pharma's plan? And at what pace do you expect to see the effect of the streamlining and rationalization and the fixed cost difference towards FY 2024?

Thank you. I cannot disclose this at this stage. But as I mentioned earlier in response to earlier question, I would like to say that we will pursue how efficient the Sumitomo Pharma Group as a whole can be in its operation. We understand that the basic basis of Sumitomo Chemical's announced profit and loss for the Pharmaceuticals segment is that the company is considering measures to somehow reduce fixed costs in this context, starting this fiscal year, if possible, ahead of schedule.

In that sense, I would say that it is a fairly stretched goal.

Wakao, JPMorgan Securities. I would like to know about the slide on Page 14, the North America segment. And I don't want to go into too much detail, but this part that differed from expectations is Sumitovant-related products. Should we simply consider that the sales portion is slightly below forecast? Or is the downward swing including sales milestones and other factors associated with sales? Could you tell us a little more about this North America segment, which is JPY 90 billion lower than expected? Also, we have been told for some time that you have not been able to promote your Sumitovant-related products well due to the pandemic. And we believe that this is simply a matter of time. So if marketing is aggressive from the next fiscal year onward, we should see growth closer to what your company had envisioned in the past. Do you think the growth rate will be closer to the growth rate that your company has assumed in the past?

Thank you. First, to answer your last question first, I understand that, you're correct. As I explained earlier in my explanation of ORGOVYX and MYFEMBREE with 2 slides, we have received very good sensitivity from clinical doctors. So we are not particularly concerned about these products as we believe it has very high potential. In FY 2022, become sales on Page 14 is not that large, although there were some milestones such as the approval of endometriosis at that time. So I think there was a onetime payment for such approval. In this sense, it is difficult to provide direct information to medical institutions because of the variety of COVID-19 variants that have appeared in the U.S. just as the end of COVID-19 was approaching. Especially in ORGOVYX-related medical institutions, it is difficult to visit such places because some patients' immunity is still weakened. The same is true of obstetrics and gynecology, where patients are sometimes reluctant to come to see a doctor because of concerns about infection. I believe that the local team worked very hard. But unfortunately, the results were less than we had expected.

Secondly, we have been informed that there have been a number of factors such as the influence of COVID-19 that have led to delays. If that is the case, the JPY 120 billion in core operating profit that you mentioned last year in your outlook for FY 2025 may be slightly off. But I believe that you will be able to achieve it with the products that you have now and the products that you're developing. May I understand like this? I'm sure you'll be able to elaborate on this in your Mid-term Business Plan. But if you have any comments now, please let me know.

Thank you for your questions. We will have to review that figure once more as we create our 5-year Mid-term Business Plan starting in FY 2023. As I mentioned earlier, the potential of 3 products, ORGOVYX, MYFEMBREE and GEMTESA, are not changed. But I think we should carefully evaluate how much room there is for growth after COVID-19. As to whether or not we can achieve the JPY 120 billion in core operating profit at this point in time, it is difficult to answer without another review.

I understand. Am I correct in understanding that since you see no change in potential, we have to scrutinize the speed of the start-up process?

Yes. That is how I understand it. We have unwavering faith in the potential of these products or peak sales or whatever. But I think we need to look a little more closely at how quickly they can achieve.

Sakai, Credit Suisse. I would like to ask you about the domestic business. It is clear that North America will face a difficult situation in terms of profit when LATUDA disappears. But on the other hand, domestic earnings have been decreasing considerably. I will ask one more question later, but I couldn't hear what Nomura-san said very well when he mentioned reorganization of sales works for LATUDA. But anyway, how do you plan to rebuild the domestic business first? Can you first tell us if you have any prospects in this regard?

Looking at the current status of our domestic business reconstruction, we are well aware of the fact that we are experiencing negative growth with revenue declining every year. And we are also aware of the major issue of what we can do to address this. If you look at our current drugs, there are many diabetes-related drugs. And then there are many psychiatric drugs such as LATUDA and LONASEN. Our focus areas are psychiatry, neurology, oncology and regenerative medicine and cell therapy. And we have a variety of psychiatric drugs. But unfortunately, the market for psychiatry is not very large in Japan. And our main market is in North America. In this sense, in order to somehow increase sales in areas other than psychiatry and neurology, we have decided to do our best in the diabetes area, where we have built relationships with various doctors. We handle items launched through alliances, partnerships or licensing of other companies. At the moment, it is difficult to say whether there is a pipeline for significant growth in Japan. In this sense, we are working steadily to launch our own product in the psychiatry and neurology area in North America and Japan. Then through alliances, we will deepen our cooperation with other companies. Such a way of doing things will continue anyway. In the meantime, the Frontier business and regenerative medicine products are also expected to launch. So we are determined to obtain approval for our own in-house [ seeds ] and make them available to patients. I think this is the best way to look at it. So we will start with the psychiatry and neurology area, regenerative medicine and cell therapy field and then the Frontier business. Until such a thing somehow becomes a pillar of revenue, I think we should try to do our best in the Japanese market through alliances and other needs. Of course, this is just what I'm assuming now, but I am also thinking that we should consider what we can do in the next 5 years from a new angle with a little more wisdom. You mentioned you could not catch my voice when I was explaining the North America sales structure. I mentioned earlier that we will promote LATUDA until the last minute. But after that, we will dissolve or rather eliminate the LATUDA sales team and reorganize the sales structure.

How many sales reps are dedicated to LATUDA now?

I think there are less than 400 full-time LATUDA members.

I understand. So those people will be subject to that restructuring?

Yes, that's right.

Just on one last point. You mentioned that GEMTESA is still lagging behind and that Mirabegron has a high stronghold in the market. But I think it is a fact that Mirabegron stronghold has been high since the product was introduced as well as when it was launched. The fact that the penetration of the product has been -- has not progressed is due to the influence of COVID-19, which you have mentioned many times. But there is something else that you have misjudged. Sooner or later, a generic will appear for Mirabegron. So I think your company's approach is naturally to secure some market share before the generic appears. What are your thoughts?

I think I have different views on the evaluation of GEMTESA. We evaluate that GEMTESA is growing well. For us, there are many factors that differentiates our product from Mirabegron such as no warnings for elevated blood pressure, no drug interactions, no prolongation of QTC. And since it is used by elderly patients, it can also be crushed and taken. There are many factors that differentiate our product from Mirabegron. We understand that there is room for further growth for us if we can firmly penetrate the market. Rather than being sluggish, Mirabegron's market share has always been very high, and it will be difficult to break that market share. But the current sales situation and penetration are a little better than we expected. We are not particularly pessimistic. We had originally thought that it would take some time to break the stronghold of Mirabegron in the market for beta-3 agonists. So it is not that we are mistaken in this respect. We are not in any major misjudgment about this. We consider it is performing as expected or even better.

I would like to supplement the question about the number of sales reps in Sunovion's LATUDA, which is about 300 as of the end of March 2022.

Muraoka, Morgan Stanley. As for GEMTESA, I think I heard Nomura-san say in his presentation earlier that you are in a situation where you have to deal with the price. What I'd like to ask is if the generic entry will be later than in 2024 for Mirabegron, but if you continue to have to discount the price a little bit when you fight against Mirabegron, I think it's natural to assume that you will have to deal with even bigger prices when the generic of Mirabegron comes out, although we don't know when that will be. Should you be prepared for this?

In terms of price response, we have differentiation points, as I mentioned earlier. So if we keep increasing insurance coverage, we will be asked to offer big discounts. So we want to have a balance between coverage expansion and price maintenance as much as possible. Whilst the price has gone down significantly, it is very difficult to restore. So we are trying to do so carefully. As I mentioned in earlier questions, there are many points of differentiation between Mirabegron and GEMTESA. And although they have the same mechanism of action, they are completely different drugs. We believe that we'll be able to differentiate Mirabegron and generic Mirabegron well enough, although there will be some impact when generics become available.

One more thing on Roivant-related topic. I think Genevant, a subsidiary of Roivant recently sued Moderna for patent infringement. And I think Genevant was on the list on the last 6 company that your company could exercise its right and exercise should be done by 2024. It's hard to ask the question whether or not you are going to exercise your right or not, but I feel that if 2024 is the exercise deadline, the patent result is not yet available. But considering the bonus points, I feel that it would be better to exercise your rights and get 100% of the patent. How do you think about this area now?

As for Genevant's patent lawsuit, we have terminated our rights and options to Genevant in the negotiation with Roivant after the alliance. So the outcome of the lawsuit will not affect our business.

Hashiguchi, Daiwa Securities. I think you're talking mostly on a quantity basis when you write about the status of ORGOVYX, MYFEMBREE and GEMTESA on Pages 7, 8 and 9. We also received a price discussion about GEMTESA. I would like to ask you about MYFEMBREE. The scale of sales seems to be a little small compared to these volume trends. I feel that the sample discounts and rebates are a little too much compared to the preceding products. But what can you tell us about the volume base, the timing for linking MYFEMBREE with larger sales and what measures your company is taking to achieve this? What is your company strategy to achieve this?

Thank you for your questions. For quantity basis, we will also do free samples. Anyhow, we are a latecomer to the market. So I think we are doing this because we need to raise awareness. Thanks to the launch of our GnRH agonists, the market has also increased 2.4x in some cases. I think that will gradually translate into sales. As I mentioned earlier, there seems to be an increase in terms of the willingness of obstetricians and gynecologists to prescribe the drug. So at this point, sales are low, and there may be some concern that they are not being properly linked to sales. However, we are hopeful that this will show up in sales in the future.

Since there are no other questions, we will conclude the Q&A session. This concludes today's briefing. Thank you very much. [Statements in English on this transcript were spoken by an interpreter present on the live call.]