LLY - Earnings call transcript Q2 2018

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Q2 2018 Earnings Call. At this time, all participants are in a listen-only mode. [Operator Instructions] We do remind, today's call is being recorded. Replay information will be given out at the conclusion of the conference.

Ricks. Dave speaker, hosting Your Please go sir. ahead,

Dave Ricks

Good and Company’s Thank Lilly’s and you I’m for Lilly Eli Chairman for us CEO. QX Ricks, joining Dave morning. XXXX call. earnings

today’s President Elanco of Lilly Jeff of our Labs; Chief Christi on Lilly Joining and Smiley, Lilly President Lilly Animal Simmons, Research is ill unfortunately are Sue Lilly Shaw, Dan President Dr. Oncology; USA; Enrique our Dr. me Health, Bio-Medicines Skovronsky, and Financial call won’t today. of of Officer; of Diabetes joining be Conterno, President Josh President Mahony, and us

for We’re Heaney, ImClone, call retire successfully R&D led end of Please past for our several want for Johnson will at to Phil also of key now company patients. the Lilly passion Sue Kristina Lilly joined has brands, her team. Sue of the round a refocused at the me leadership Sue. Oncology be by of Wright, will and and including for inspiring Kevin recently Hern for I This strategy. who Sue IR years Verzenio; at her integration the Jim launched August. helping over Mahony, and join the earnings Oncology most through last thank President of applause XX the Oncology

and call, statements this expectations. making based projections we forward-looking During anticipate on our current

latest outlined SEC. our to prescribing and number including is the and The not investment those for factors, It the promotional information in is to XX-K listed benefit it pipeline filed intended the of products for community. decisions. Our we sufficient X results a materially, about of is not our Slide provide and differ actual be those due could and on with Forms XX-Q

start of and second strong XXXX the growth EPS X%, of revenue quarter non-GAAP continue non-GAAP growth XX%, operating XX%. income the of growth with We to

our Trulicity, Basaglar, driver growth, Taltz, to products worldwide the of pharmaceutical New Verzenio. and continue revenue be led by

of offset exclusivity of revenue the declines established on products. more resulting loss number our from growth product than New a

to margins this continue We expand quarter.

gross effect Pfizer. by points approval known margin XX.X%. the of of operating U.S. in and and FDA the X non-GAAP read-outs EMA increased basis as percent OA by inventories and the Phase to over Glucagon, significant launch a We revenue sold, of as collaboration and as income, pipeline, and as basis progress made of as Excluding and including axSpA Nasal QX with XXX episodic XXXX, points nearly non-GAAP of in FX, revenue Olumiant radiographic tanezumab on percent a increased Taltz the with international spondylitis, pain cluster positive also galcanezumab ankylosing for headache, submissions well in XXX

changing resources to independence repurchase sale deploy And will of million after-tax intend allow to efficiently value and of to shareholders And pursue our the review, Elanco stock, IPO a in publicly Based on the including review retention, medicines of a business. best would a the $XXX be Elanco completed and of initial We wide the Lilly its concluded to to subject which statement range and factors terms program. for and an the pursuing considered by or greater capital human of be available of options, last perspective, deployment, carefully repurchased added upon release, uncertainties, anticipate registration we creating that an XX% Phase million directors IPO offering separation dependent including $X targeting completed business life board even for October, management share the few public allow the of this company IPO customers. ARMO in focus the next pharmaceutical we authorized of pegilodecakin portfolio. an also business the dividend. We establish will Elanco. of traded via less purpose the shares we our From strategic BioSciences, Since reflected And Lilly’s to as and those the weeks on via and is separation. we for the maximized year. serve Elanco’s public the a to our IPO subsequent Execution Elanco subsequent acquisition strategic of we its of billion number program. an a growth Elanco concluded as patients. review we of and this announcing believe the alternatives will Animal independent are we business returned opportunities the new of $X nearly that previous This In this morning, repurchase than our released market before end timing conditions. million of our $XXX we which press X share and

the Given any by call imposed securities period to laws, we on if potential will IPO. today’s be able many the respond not quite on questions to

X, but for now Slide to our Josh key to update guidance over turn and X, an more XXXX. our financial results our earnings April call, QX on to me Moving let and see provide details since events review on you to it will on

Josh Smiley

Slide of our GAAP and results presentation non-GAAP X Dave. Thanks summarizes measures.

of focus my While on Slide our trends underlying GAAP non-GAAP results. into X in the insights comments business. our provides to provide I’ll our a adjusted summary measures

of earnings in today's results. for changes release second So please a GAAP year-on-year our description refer the to quarter press detailed

the international earlier. revenue the mentioned non-GAAP was due Dave see decrease you'll as X% margin increase of exchange XX, effective Gross that to sold. of the foreign at to on decreased revenue Looking on This rates inventories XX.X%. a measures Slide percent

effect income Total declined Excluding QX XXXX, cost as driven compared compared efforts Total excluding to selling, our increased marketing, production. partially Total increase by effect, expense our margin operating in-part sold, and manufacturing X%, to the R&D of decreased we points by Dave which increased on this FX income accelerated income gross international an improvement the XXX of restructuring reduce by took a of percent operating operating XXXX, as by last versus to continued to points, the FX of and increase quarter. $XX.X put by for our with at an expense X%. of actions in our Other $XX.X offset timing basis last revenue XX.X% expense the mentioned XX% our to QX, decreasing structure primarily margin X% XX.X% late year. driven operating as percent earlier, revenue, quarter XXX last expense of administrative compared basis million income margins, efficiencies, with operating inventories quarter. of a points, and revenue million of was expense offset actually this year’s of XXX nearly manufacturing quarter. year's basis income And

with year, increased improving a driven primarily our quarter basis growth, Slide shares XX%, tax significantly U.S. from increased June operating impact We Our expenses, last tax shares by while non-GAAP while the repurchased. same by rate was XX again at these due the reform. XX%, line, reduction for At XXX faster compared earnings bottom a decrease this to slightly high-single-digit outstanding revenue share income of earnings XX%, per net points, quarter. of reducing achieved details year-to-date. a in significant delivering profitability growth measures same the

XX non-GAAP provides EPS. a While reconciliation reported between and Slide

on XX. details additional will find these You adjustments Slides and XX on

revenue at to volume price Moving growth. look and effective XX, a the let’s on Slide take rate

worldwide This growth benefit quarter, benefit, excluding X%, a the our performance a this on foreign effective revenue provided X% by driven was basis exchange volume. entirely

entirely geography. Pharma delivered quarter. Pharma volume U.S. our diabetes volume. almost over Human this delivered our volume XX% U.S. again quarter, major straight in XX%, each sixth growth business growth driven revenue increased Notably by portfolio a For

We also benefited revenue, from $XX which U.S. totaled Adcirca higher million.

of the grew Moving entirely loss FX, despite by driven volume revenue to excluding exclusivity Europe. X%, Cialis. Pharma for

of led Taltz, Excluding Olumiant, the which Volume driven price driven grew contribution namely and by the of was in effect over Jardiance. Trulicity, also volume Cyramza, growth X%, Taltz, Trulicity, Lartruvo, impact with from In Jardiance new pharma Cialis increased offset Japan, excluding coming Olumiant, This FX, growth This the the significant volume partially volume biannual products revenue pricing by volume. cuts and QX. was by growth LOE, and entirely took by Cymbalta. was a impact XX%.

in Trulicity, the Basaglar, Cyramza, Taltz. quarter, of volume Our rest and increased Jardiance, this by a Lartruvo on the growth pharma world led of performance revenue basis X%

Turning to Elanco X% total, performance terms. revenue quarter our animal declined in health. In this

which are in business, on listed X% which Our of is business increased exits, Core-Elanco terms. forward foundation core-Elanco going performance the XX. Slide strategic excludes the

by well growth Galliprant, in driven in QX amount contributed Animal our sales poultry continued to ractopamine as New QX, million products, patterns the XXXX, companion driven INTERCEPTOR animal grew Health animal core core purchasing year. the by by QX, uptake by of continued offset animal X%, Trifexis double The $XX primarily in last food driven partially The products business offset competition. partially was XX% competition. nearly PLUS, U.S. This in increased Credelio portfolio. companion business as and and by aqua in strong

call, Elanco’s Since actions manufacturing last sale take a is and we in improve completed a and facilities to distribution Augusta to exited continue We and to core to we focus its that core Elanco’s the strategy. agreement of business the and profitability. areas not product Sligo, Larchwood our

pursue outlines marketing year-to-date to the our could allow value for while indications Imrestor, we We provide results. additional also made XX to to June decision more Slide that suspend information Imrestor our of the customers. same

the were on at our volume Verzenio, volume worldwide Olumiant, growth. Taltz, Slide the including products, our Lartruvo of and of look growth drivers engine In our a Cyramza Trulicity, new take Jardiance, let’s XX. Now, Basaglar, worldwide total,

and represented for volume Effient, growth lesser the $X.X Cialis brands our growth the due Slide I'd product revenue. highlight entirely almost this percentage Taltz of by points erectile U.S. the generated XX% over this that launch continued worldwide Cymbalta, to here a volume. second Europe. view the XX% our basis Zyprexa, When and generic to LOEs and arthritis, provides had rest excluding versus uptake [ph] XXX and Strattera, see quarter, Axiron while XX.X XXXX, a approximately the Taltz, of billion Evista can grew the for by to In products exclusivity total volume growth accounted XXX compliance U.S. quarter. and psoriasis these the The provided indication new was extent like declines which of both in of psoriatic XX% in a our QX You these revenue driven This our for in drag products of in in disfunction worldwide of points, total, of of in due entry basis XX%. of volume uptake. and of loss of to drove points XX products. Cialis,

pleased which Lilly’s be long-term also this results had a test genital granted and to and moderate Dave with to as and difficult confidence superiority second to underscores psoriasis. for severe to Later study plaque in this earlier will update to We’re year, was in power initiate U.S. X label mentioned This we with include treat our positive data that the in quarter Phase our announce commitment both on Taltz Europe trial a patients Taltz, Tremfya, psoriasis. measures head-to-head investment plan to immunology. as which in key axSpA, well

effective small XX, Slide impact was with statement income our this with on non-GAAP on small impact quarter to positive revenue continuing the and FX negative our Moving a earnings. minimal on a explanations,

this suspension R&D be the a On share of impact basis, our guidance uptake of updated for new partially the the higher expect share you related from exchange At of earnings an now by of Turning line, by non-GAAP of and a to impact will percent, gross an see movement, which the the foreign XX.X%, margin foreign in an Slide in favorable per Imrestor basis, to margin by guidance movements, the represents particularly BioSciences. in to acquisition increase ARMO by well tax is increase of the and financial the percent on reported XXXX expected to brands, increase on charge million the diabetes $X.XX driven we’ve our foreign of non-GAAP across partially between to mid-point our continued favorable over for offset XXXX. is non-deductible primarily $X.XX basis that inventory range, weaker on offset reported points a our portfolio, IP driven to basis as point reported top reflect rate XXXX our driven XX the finally launch percentage exchange by driven strong a in an range XX% sales. collaborations as revenue, of XX% XX, by A currencies. the increase now earnings per of $X.XX. to be our on impact of gross performance in $XXX of and An primarily increase is while $X.XX, charge

updated between second the exceeds price half and implies non-GAAP $X.XX does not Our year. the consensus, $X.XX, our which guidance EPS remainder of assume and increases of U.S. for

Cialis Adcirca for NILEX, investments EPS, the to half due our ARMO from generic September, R&D in expenses realized financial late allows U.S. U.S. first we to and our Taltz second XXXX stage and expected for performance we revenue including total, acquisition, products, support which half. us that than led extent, our objectives. Olumiant to first investments, and lower portfolio half and gains the strong which a the volume expect by positions it’s the mirikizumab, targeted new to higher achieve However, competition for long-term higher galcanezumab collaboration IL-XX half lesser in second in additional launch investments the in well In our

Now, back key I’ll turn future over to pipe the and review call Dave to events. line the

Dave Ricks

XX the the of are includes our pipeline. NME’s July studies which of ARMO also Phase and acquisition Glucagon movements reflected Josh. Nasal addition select in Thanks The and summary acquisition the call, Phase the II from shows mentioned positive pegylated XX. IL-XX quarter I pegilodecakin, at ARMO as of now for Slide the of my NILEX for In beginning the BioSciences. X of

Additional studies the for Phase and AstraZeneca in diabetes completion Orca an studying the of with attrition one of Alzheimer's; the acquisition. include Phase movements X of into diseases addition ulcerative antibody Phase and A at Aurora events the XXXX. our On start colitis. update provide start of the mirikizumab for IL-XX of were from for in Phase inhibitor lanabecestat, X we earnings for BACE key Attrition expected both inhibitor our kinase Tau all with our Slide X the asset. antibody of The call X we on XX, psoriasis collaboration the Alzheimer's

of for In pain for to of the Phase new updated liver for data. Phase of the expectation U.S. galcanezumab. be for American Nasal combination Lilly expectations revised new movement see KEYNOTE-XXX of occur the label line see the of empagliflozin, presentation you’ll end I’ve well as the and cancer, the a have pipeline already you noted, added Ingelheim's Cyramza, line Glucagon that Under that second well Alimta to Society and the that you’ll Headache as Phase will reflect X the regulatory the X addition the the indication the our section of we X attrition X data trials submission submissions, U.S. tanezumab for Boehringer in before year could at submission the cluster in at the and see Phase And as disclosure XR data X announcement will ASCO metformin reflected headache REACH-X the OA at and topline Phase lanabecestat. positive data In of we study section, presentations Cyramza, the the linagliptin XXXX. as presentation in publication of

next-generation to Phase for to a given have intensity in past, a this in initiation lupus high category. In now data said inhouse Phase look Phase X, alopecia. added the Phase data molecule efficacy we’ve our In have We X incretin. mirikizumab that high the competitive noted of for data for we data. X baricitinib Phase EASD see X terms to into We fall. the this the the Phase of to before bar now X starts start adaptive study for and study will that of of this and bar. for The we host year in move expect earlier, I the this in results initiations, you’ll X And presenting a this this discuss met We've call end II/III Phase the from X also the for Phase GIP/GLP presentation, novel agonist at forward X line diabetes. type following

XXXX. In XXXX we plan in or to late X start early addition, Phase

data the Alimta ruling both the we company, we to XXXX. the and for Japan, quarter held Europe in for disagree actions are and German clearly the to Patent and galcanezumab Federal regulatory events highlight the plan a Verzenio appeal Trulicity. look for and readout forward our the We busy was the in as positive patent decision. I’d in well of This there this Alimta strongly vitamin regimen and U.S., productive study still the Finally, expected many as with REWIND invalid. to in Court Notably, U.S. had while rulings Japan,

sum the session, over let RA significant patients of we’ve leading this of total progress go nearly briefly Before efficiencies to the XX% me for basis the Q&A for up products data our quarter. and Phase Nasal XX% galcanezumab. QX, made as and progress in this position of indication we structure well accounted FX. with made as new In to for We’ve revenue, Pharma and our revenue. patent Despite the points, and Glucagon explorations FDA and data health and recent cost our in business to in submission grew Human when exits Pharma Volume X% for our U.S., operating pipeline new business. expansion realized animal excluding strategic of grew in We excluding the X%. excellent our Human X margin Olumiant FX, EMA nearly XXX the tanezumab, launch the quarter Taltz of by

dividend over repurchase returned via strategic share a significant our billion also Business. new We decision Animal program shareholders made $X.X of and future on to and repurchase. a billion We $X Health authorized share the the Elanco

Before that hold and cycle XXXX initial opportunities would investor pipeline like select I we our December progress, will this to we to highlight products. including Q&A, marketed the for share life move a guidance provide to meeting live

limited the turn remarks and available, provide team Q&A the on moderate will days more Phil This contact be relations to our and space session. in call over our to coming now investor concludes logistical Given the issues the details. I’ll invitations prepared to

Phil Johnson

caller. callers to thank the and please would Kevin, take Instructions] we for Q&A can the as Great, questions if first many ready We instructions then session provide like for as from you you [Operator Dave. the are possible.

Operator

of SunTrust. ahead. [Operator First the question Boris, John Please line go Instructions] you. Thank from is

John Boris

just emerging and that the best do congratulations that’s are the with ability scenario accumulators results HHS administration, that some to just the proposed medicine, it co-pay copay obviously which to on could operating be you use on patients base pain, around come where access half? detrimental And that that any cluster out in view in by is data have pretty that? of any franchise, worked secretary franchise, seems rising galcanezumab, scenario on just on manufacturers thoughts has as blueprint? for and out decent to potentially just which to assistance question seem Lasmiditan, blunting the in to with that then Dave, seems House coming headache, issue have especially your case to this hit so Lasmiditan back certainly and do first Thanks. has question an Second area taking here over to to thoughts for the the in that or blueprint, have industry against White thoughts accumulators, the nothing getting that the copay profiling very questions quarter. so, just of Thanks what your optimism you timing the and the area, case do

Phil Johnson

Hi, for want questions. great. John, go want Dave? if you be Dan and the anything you pain then ahead on thank and would that franchise to Dave the comment, if

Dave Ricks

for Okay, questions. John and the great. Thank thanks

on recently, industry policy side, seemed the rolled the to requested responded have Just And of information. course actors in May. in was the out all and to blueprint

a where that this do really this So, asked point. will to thing ideas me there there. dozens in is difficult of to at is you Because guess land,

may many have know watch to right of scenarios consistent and this change, broad the to you Anti-Kickback heavily might patients last deductible OMB the rebate spread but on any think there we’re in the to administration are going a and for indicates Overall, initiated bad questions I changes via think be change with and archive net some week rebates. have to have noted, support the where of safe to on Statute that in assume been ways I what pricing. develops. this we’ll have is but sent course which there, I – it high rule or growth that allow that. we think can the reduce those for think be treatment. that more thing I because though insurance don’t substance We administration without comment I relates price that that know you’ve to We today. a to actions point proposed to commented the don’t the and harbor, rule to looking that is will is rule all Anti-Kickback and that relates the specifics as theme first industry through preparing of have to think in closer at we as how for the of that’s a of don’t don’t We innovators

future. putting off-patents, regulator IP addressing importation. move saw task hot-button In a inflationary road will Nonetheless, the rather really wrong the about we solved. together the increases. who agree begin also go the system with, but on is we administration talking about related that regulatory from in We brands, say of the is method The but our a force down, absence You and take we the to this disagree clearly, super think fix to to that’s with. issue, price perspective, be that a administration failure have to more is should to it

in what think innovators we I regulatory over and reform I in year – we are think busy said I I in call that��s seeing. fact think January, the expect for could a QX the in

see the changes embrace set embrace as this choice, provide pro-innovation be watch be a end of changes more but updates. We’ll come it’s and happy these carefully it forward. I unfold; how today, difficult we’re of as of to very to did from we day, additional the as various B, to at say at we’ll I additional we of commentary going already, actions innovators than course For investor market have long can Getting to fine. think as to A that driven

itself Lilly, high with copay consumers policy, of said. they shifting this This of this in by in is impact just to going think coupled direction the back back is say, the could It cost, but on think limited a standing very is our the now for that, in performance. the by although the to it’s markets. many block don’t watch accumulators, had opposite it's a I spend I thing commercial frankly On as everything other impact forth phase. watch deductible good concerning would things, we time I We it and

doing there other payers we understand course, cost, this ways be that do so they control may ultimately to that want and, Of spending employers, to are drug though.

on Phase we’re a as And the about need lasmiditan, now pain, you’re Finally, galcanezumab’s you well. mentioned year know before country. X excited portfolio, the emerge pain tanezumab, from the have in data data to is seeing in-house. of submit of the we huge the as all you Clearly pain on we unmet do plan this end

I in the CGRP that seeing episodic migraines there problem and that to this country antibody sufferers are and expect think first we we to in lasmiditan, hope you’re that acute there continue in launch relieve many products which with antibodies, well as good CGRP suffering. reach as can enormous interest chronic like

on bullish category. we’re So, that

study will and data program. reduce the safety on tanezumab need based in drug, on studies. There is question large the the this that’s XXXX that the really We know the remains pivotal prior to Phase pain X safety on answer study. we all read-out caution a course, Of yes, can and

Phil Johnson

comments make or…? to you do have Dan any additional

Dan Skovronsky

highlight I the for think pleased Lilly, migraine and we’re the in Yes, course just that opportunities data good I’ll probably reiterate seeing galcanezumab will here I we’re of with specifically three with space.

our trials. galcanezumab has fast maintenance prolonged data works really and pleased in quality of a efficacy we’re First, quite clinical the our of with

as clearance seen as the has we’ll only CGRP data. I far we’ve now, right antibody XXX% be, think that

reduction clinical significant our XXX% That’s in migraines. So, in trials. statistically

as course The cluster could important Dave is for you you which think indication which important second headache, have we that both heard from we’re the then what is data and is opportunity the patients there. be with with mentioned, of and here we Lasmiditan, these another of having pleased products is third

differentiated So, Lilly. for opportunity

Phil Johnson

to we caller next if please. Kevin, can Dan. Thanks, go the

Operator

next is Morgan. Schott, Please the ahead. And line JP go from question Chris of

Chris Schott

Great. Thanks very questions. the much for

My context to Just pricing, think XXXX data a or two your is you enthusiasm into see restrained price into the take if that than willingness increases about initial profile and in is that put the across less the on on seems program XXXX do going increases, on forward? safety can here, X it on we past I specifically about a bit going the tanezumab, how was we safety that first increases, that industry the a continuing tone slow should disconnect price this so think beyond? given FDA we say is maybe there there out price a for and been between this And seeing more this a you we’re think the net it and Phase is trend past? has increases than guess on dynamic you list osteoarthritis down on progressing or corelated in question net threshold is forward, focused is as impacting about here, should Thanks much. gross rapidly second like

Phil Johnson

Great. price and Chris on we the tanezumab for want take you complement that answer increase to Dan? then if you to would Dan comment Dave questions. thank and free the question. then feel

Dan Skovronsky

safety past, discharge which the mechanism risk. challenge Pfizer. on said with the in we of that’s course aspects in wealth action the minister we’re tanezumab, Having data X collaborating based of have On we the some is program Phase that, in how of a confidence here new the also generated to of the changed of lot been and this we previously of we said, course drug on

osteoarthritis trials thresholds RPOA we others what progressive course here outcomes and of and our trials specifically study to X.X might study rapidly going those have milligram thresholds, spoken be titration we that efficacy investing our With here. first and where a so subcutaneous proceed. we're doses. aspect up X.X haven’t question this that our for, a And to we’re your on respect is watching we’re we this was continue of focused primarily X and on clinical hit to So, pleased that around in

clinical So, we’re late excited study or patient a this next designed to and that year with about safety XX-week year that. risk come trial. that’s probably will This next data study year wasn’t discharge the XXXX

Phil Johnson

[Indiscernible] Dave?

Dave Ricks

I Yes, that. would do

is trial I the we think, on key really Phase than discharge a use. now, large efficacy, dozen safety long-term more thing said for is study X it I gating guess I is, before tanezumab safe question the as this on

know, You term. out develops what for on on pocket cost think out, of public system point or set XXXX our has how changes We’ve this those view backend is allowing reshape happens can rolled see changes or I principles. difficult actions patients, those on is, this prevail, even this comment conversation price while increases on we then let’s been important to the sweeping to of and get as a of innovation what implemented it’s about others the blueprint of in here preserving we as potentially and forces do reduce not long market how

On the strategies. we’ll that, our reevaluate of of course backend

know things. prior as many is those current of And many, categories, in list made subject pricing adjustments across know to channel You just on gross mix quite price period of other different not but different to you Chris also assumptions net to yield net changes. subject the in on

as a all you U.S. reflects other see So, which positive, X% those will being well in dimensions. as think we I will reflect prior increases,

of products abroad. very outlook kind are is have price new don’t and still the of we driving robust As focused Josh changes where that’s in said, in we and list volume our it’s U.S. here and

Phil Johnson

Thanks Dave. to please. caller Kevin go next if we can

Operator

Deutsche ahead. of And Greg the go Gilbert, Please Bank. question is from the next line

Greg Gilbert

Thanks.

for current of that the more touched to thinking and primary endpoint not us the Elanco you the And I oral put you terms priorities on profile multitude perhaps bit, oral allocation thinking you is strong capital share meat you the here, Dave. emerging can injectable any given quarters of with the shifting about, work? your about are a for in there transactions but but bones the then GLP-X’s GLP-X or a transaction on the and question can hoping Thank your diabetes, shaped own the in a shape GLP-X coming little updates about your that bar that for on IPO in fill you how Lilly? talked or endpoints First this gears could was the you.

Phil Johnson

you Thank Great questions. Greg. for the

then Dave? Dan And what forward. question in to we if saw moving and allocation capital Lilly II. GIP/GLP you'd Enrique, on comment with like you if on Phase our take Dave, the So,

Dave Ricks

invest Thanks is after-tax think an of result Greg. at analysis shareholders. on move produces it for allow Elanco more priorities, us focus, creating forward allocating a serve and also thorough its value will focus goes know patients. products and planned produce pharmaceutical be business, I opportunities said, grow to for the deep that all breakthrough which as its to focus capital and IPO with, assuming maximizing customers the Well a Lilly’s the this will value for the business think and I its Lilly, as this you in human We for really that for many decision to

a capital on business which really and ID our to this those in result on to doesn't decision, organic our strategy of change the as cetera. launches is allocation needed Our manufacture on invest first products capital et

stage business interested our assets mostly which build the areas. to pipeline isn't in than therapeutic core can development, that before, clinical commentary we’re at our at is look really as five Secondly, to build there different

you will kind number do if to the example out allow we’re moves which acquisition notably return that. us in then saw an to And this those thing capital quarter to we of think the as continue share ideas, of regard, announcing I and of in a repurchase of most ARMO finally, run shareholders we’re a that program, we will QX interested.

there million priorities. As or we XXX so consistent with in in said, share activity those repurchase was QX

balanced I allocation. So, taken have on we think approach capital a

balance. capital have and more just You we that. can do expect that to We’ll continue to

Phil Johnson

Thanks, Dave. Dan?

Dan Skovronsky

for sure. and invested and of on is that we said build and so a tested here we’ve over previously see Lilly incretin an differentiated Yes, platform opportunities the a years continue patients, could different to lot more that there this now here that number to developed for important platform. in as We efficacy biology offer molecules

molecules, what the consider to a receptors the showed oxyntomodulin the important these example, we think encouraged both efficacy. looking testing In glucose differentiated case loss development. which other breakthrough controls. we for one and that earlier of GLP of be So, here our that in clinical these is in of for cases, GLP preclinical very dual weight highly and agonism of we were studies these molecules each in of we’re second are now trials, really we're In

therefore We the that clinical So, Phase we're clinical We by this it into for encouraged Enrique trials. of by there and into And hand commented what we’re X trials. took Phase moved X it that. module. it encouraged I’ll saw to we future

Enrique Conterno

no. Yeah,

the able it Investor following full I to product this comment well, say efficacy framed EASD have we think bar, for bar at to an of And you’ve but presentation have met and that that specifics we but a that. high incretin. to do on Call just then the do plan we of won't any type clearly be a next-generation

Greg Gilbert

would That early be October.

Enrique Conterno

correct. That’s

Phil Johnson

to you. Kevin caller can go you Thank next the please.

Operator

will And go Baum, Andrew that Citi. ahead. be Please

Andrew Baum

topics. Couple you. of Thank

zoom first around proposal rebates. the the on question to on in particularly Just the blueprint

may the then XXXX we timing, maybe you. plan is some you this for happen remove the just in amend that just is that is system. working remain how given anticipating finally, with which plan. the will to in What that could totally on are the structure of you federal you again scans rebates requirement, that forms the one with the is relates understanding meaningfully sure business the as plan. the the saw to radiographic nothing the is? assume their NSAIDs, in increase envisage make case, patients trials? tanezumab. your that Second, earlier commercial that if second I do of enabling given stakes conceivable is that’s premedicating assume federal assuming may just PBMs until to of that want anticipate terms if consistent And of that earliest world or of Our Thank question altogether it you real-world the change? rebates Or topic, going side would And understanding? Is

Phil Johnson

Okay.

earliest business appropriate? blueprint, that XXXX series thinking PBMs understanding in So, specifically the will questions in we the program, What effect, are of you programs? is kind only go radiographic terms we’ve tanezumab during had that the scan. on for the on essentially our required labeling the impact of we federally be of a question of of timing into on change of same that the commercial And we and had also is rebate applying

Dan on take want the comment if if but not blueprint we tanezumab? see can Dave first So, sure then much say, the as you on question. whatever we you to speculation want I'm to can and

Dave Ricks

I rule. is was difficult speculate just the Andrew when to to is it we reiterate. have title on going the a change proposed all real of

federal new you safe I is can, I who replacing statue, it with it of us, Harrington's it and Mike just if comment to think our that? rules with the Statute with General but harbors. and want it change came that and set you think like which Counsel, rebate the the about believe on is two, read programs, the Mike says to basically Anti-Kickback I a we first think I

Mike Harrington

payments see. think have prescribing. we’ll I Well to to Anti-Kickback induce made The Statute addresses

will potentially, So, more the it we to that broadly have federal it it but could monitor programs. is expand closely, beyond just yes

Phil Johnson

you. and then tanezumab And labeling? Thank the radiographic

Dan Skovronsky

sure. Yes

labeling know to as to the to RPOA. made try certainly don’t we So, but risk primary have yet, decrease changes that program of we given you premature speculate and the X the on some data Phase on the tanezumab, safety

dose of I the is most significant lowering tanezumab. think among those

was that’s the the so again need. We study have titration in we that. this step that still demonstrating first efficacy why And

change well eliminating screening use in OA as reducing was or Another as changing mentioned. the of patients, our as you methods NSAIDs concomitant

about that Let's see in labelling. what talk to the data show headed able where and based be more we’ll we’re on

Phil Johnson

caller please. Thank you, Dan. Kevin, next

Operator

have Morgan Please Stanley. And David go next ahead. Risinger, we

David Risinger

a thanks few have Yes, I very questions. much.

strategic thus to the annualize? Elanco, that to about first completed negative IPO, when when question. So were that and First, but obviously mentioned had you can't with the a exits second quarter impact the you the that’s understand better for revenue will strategic I talk on just in those respect exits wanted they

then products respect the were so and candidates, those they much. Phase us in X you have sequentially, strong, a understand is X they framework Second portfolio was Thanks the better and, that despite to And question those you candidates years, sequentially, rest two my timing? in provide with flattish very programs, of respect saw? coming prescription readouts Trajenta, for Phase the including growth just could extremely Jardiance were with obviously can we to final you both two Alzheimer's flattish the outliers, of were help why with your

Phil Johnson

Great you thank Dave, the for questions.

Jardiance the to question for to X. Josh Trajenta, you and our growth and for maybe time over and when So the completed what then is some programs want then Phase of for for take to annualize first the eventually sort and of exits on course the Alzheimer's strategic Enrique questions the in we've if Josh? on sequential those Dan patterns

Josh Smiley

strategic over the Augusta of and manufacturing would in completed but be significant Posilac the the our Georgia, in exit most just The David. Thanks month. plant this really course business that exits we

the half beginning you’ll has we know you last annualize see some I this as this of we of to XXXX saw So, Posilac declining been significant of course revenue and as the think headwinds through so second walk in over start year. start to just in XXXX, the total year

of quarter the the strategic that’s late it into see for was gone we XXXX, every because be time think I sort that opposite numbers exit down significantly. we product of get declining will before product Posilac the but by the effect totally the the majority pretty

contracts, around had to we second Elanco, began half as of Remember will basis well. we a a year beginning would we normalize the start guidance year announced gave growth some to pickup in of on out acquired contract were as also when in on low half this numbers. big items said, vaccine but we we of the margin the few including a the that a that year when second We the you numbers these for the portfolio, the opportunity, in the see that exiting come of of smaller at the in manufacturing BI topline

the we’re growth why not, which forward. that’s think we are our on really of is from, looks basis focused not I that is at business, portfolio, Elanco and core going which exiting

Phil Johnson

Thanks Josh. Enrique?

Enrique Conterno

Very good.

have of it’s only We discounts versus previous So, U.S. year sales, total net net the we the Jardiance number sales that but quarter-on-quarter in quarter-on-quarter. is prescriptions trends changes comes it color, what we year more TRX net have see basis quarter previous a let’s adjustment estimates to there start case due an the when comes to comes for XX% it maybe one. there did we growth and to to steady a for show is net growth rebates year When would and versus increased so in Jardiance, bit just disconnect prescriptions to been it that that’s growth the the in XX%, the provide previous when XX%. versus XX%. growth a the the of comes On when basically the Trajenta reflects the a solid easier basically sequential a very to see sales the because for Jardiance normalizing with sales. it

of basis Now, the changes you when the those of and rebates when really have you look sequential double so in basically and look on sequential a at Jardiance, some for in case a whammy quarter-on-quarter comparison. we QX, estimates discounts belonged effect

Phil Johnson

Thank Dan? you, Enrique.

Dan Skovronsky

designed is trials Yes, we’re symptomatic on with thanks question actually question starting in the a for in Parkinson's neurodegeneration-targeted have it suffering molecule the for X portfolio. the diseases be patients DX dementia. We X testing molecules on with PAM. Phase neurodegeneration This Initially, dementia. to

of success move we get that in believe there also but would that quickly we Alzheimer's there if is a a to reason in population, very disease. parallel have We that to signal positive probability higher

that’s So, the first.

an the standard anti-plaque two Phase plaques to clear pretty depth. dramatic in what other a can This really The on antibody. we X one that A-beta is that’s NXPG saw some trials. next you it molecule mentioned, very Based behind

great of also a with a speed. So, and amount degree of clearance great

think we’re seeing mechanisms. I clearance faster So, other that with

excited So, we’re about that.

We’re testing monotherapy. as that

trial you it it’s if that that disease combo could has of clear a combination also production, although monotherapy a been disappointing turn with drugs the disease Alzheimer's plaque the base in conjunction first therapy. We’re here A-beta out inhibitor, with also I added testing thought two in base and off modifying benefits. have believe

is biomarkers important Phase the Tau forms aggregated three have or antibody. give to X Both the both trial designed that of really we are X on monoclonal we us specific for and So, all This this on and morality Tau trial Phase think enrolling of and an is therapeutic of efficacy endpoints. Alzheimer's. is signals those then and also cognitive

and modifying depending this potential period, to have enrolment clinical we an the data I is earlier, year. also show XXXX, for XX-month next treatment in but trials.gov, disease think depending analysis trials on on even on it’s interim rates potential ending read-outs

to have see go. trials and how wait You those will

Phil Johnson

you, can thank Dan. Kevin Great, go to next caller. if we the

Operator

Please next line of, question Rubin, please, Goldman the Sachs. it’s ahead. the is And going Jami go one from moment be to

Jami Rubin

and different are that go to to different rebates numbers so you in there your said net volumes, induce to looking for think your hard just of because just consideration at own that to take that David volumes this look you how go has structures about here? a in rebates if it’s play that the be that the it’s diabetes I scenarios, rebates, to to can into you volumes lower if you potentially rebates, XX% predict is go you. want this the at and to Is widest billion rebate Thanks. recognize how scenarios a not are to to about back positive about would franchise. when XX Thank filing even Conversely, business? but you thinking you out risk Lilly away, happen some of questions expect price, down industry, to play can would of volumes early just Lilly's the around and lower is how gross and expect largely used out, net going what change those volumes,

Phil Johnson

Dave? the thank Great you questions. Jami, for

Dave Ricks

mean rule. will don’t price happening on here. caveat We U.S. we the to where know waiting the system in Thanks list here don’t know this paused seeing changes go. Jami. what We huge the We don’t the know I opening what is is, right.

drug that to capital approaching the you numbers diabetes get large a reported very segment large spreads, you a and last spreads gross very we just primarily and in that have the XX% gross XXX%. federal of right to to to in Medicaid were you net net have right, Medicaid So, population year particular because

at side that. be all it. about treat on Medicaid open the the pretty rule would it It guess cetera, other to change that it what on this been have et enacted, we really depends whether of would be would So, how commercial system, would whether

said products As hospital innovative first in systems, make where people of want products, the my list system seem medication to pricing it costs need, structure to with the improve system, resulted consumer hopefully the I believe in carriers, we're think you to a know I improve I though, volume, much be would patients. down, basically problem and insurance we if and response for the the have is industry distributors, manufacturers current adherence, pricing fine outcomes current shifting too that directly via consumers. improve came has

why good general this that’s a direction think, we we think in So, way. travels

to predict to way have would all net more to you're room a see the and just without very gross what specifics regulatory here in of difficult for be the specifically, of clearly their a line for or, disruption Lilly negative we to is Now, seeing the lot happen talking there reforms. about it'd totality

Jami Rubin

scenario a that well? volumes there net positive industry, your Is if the as away do go where go rebates this but is a for down, even

Dave Ricks

Jami, lot I is to think scenarios it it of is speculate. hard a

Jami Rubin

thank Okay, you.

Dave Ricks

Yes, great.

Phil Johnson

caller. Jami. Thanks to Kevin, the if next can we go

Operator

have we next And Please Meacham, ahead. Geoff go Barclays.

Geoff Meacham

et psoriatic a like the smaller oncology, in for – Thank now fair spin-out, to is obviously a like just help is on Josh, studies of example us Olumiant, the for this the Hi to And want still your put would and I X going about dose are expanding forward atopic a guys, question. mg strategy priorities dermatitis, or with, maybe it need assets few to compared feel arthritis, there just category at you to BD options just Elanco the add lower On deals bit maybe you? the the say guys the little you it you've pipeline are done cetera? then, Dave you be looking in more competitive? a know, label to ask context scale in in priority, progress What that detail already for RA. more with and is you oncology you thanks

Phil Johnson

you thank Geoff Great, the for questions.

then Dave So, comment other on obviously can forward. moving RA we we're that evaluating how priorities the Dan? that business and going with the comment strategies have and the Dan mg maybe opportunities X if for on you NILEX in development may forward that compare

Dan Skovronsky

thanks. Yes,

each we potential clear the that are about outside excited doses realized, the baricitinib We greater in both where that potentials being the the benefits position places U.S. about think approved. advisory are step of I are course, our what in we at in a patients that could were of At for still in the have to dose committee, extent next of and outcome for, doze terms our clear think we are steps patients for mg I be for considering this might disappointment, X the different next after time. possibilities internal

of for prioritization for terms and here some but which really I the indications, Lancet, here other the the was opportunity in think, first of data, to great lupus. recently also baricitinib great a RA, here I think opportunities so in for in in published lupus class that is in be opportunity us patients an there in represents

where X trial we Phase about have ongoing. a excited We’re also atopic derm now

So, lots opportunities bari for remaining. of patients with

Dave Ricks

are sort and know of pointed disappointed quite launched launches, we we’ve and This update know that to as do probably German different at with in July you basis. that far patients QX molecule in French a More the add, the with mg positive is X just relief. used in just global call the very in in disease for modifiers Dan investors RA modality now would the ongoing, more of in as pain broad. potentially performance rapid the we’re and than I promoting anecdotal from performance U.S., are launch cycle at life have we’ll a feedbacks detail and from the U.S. to Yes, which on the the

this, I BD. wrong. question On have of second it with all priorities, Geoff, say would you satisfy I I wouldn't that attribute the but think it hate BD to exactly

a that the assets in we areas cash – flows, line, with, we income, position growing interested all are very We our we’re therapeutic interest. acquiring of are now top of growing we’re growing are in

terms to the We a of are and for growth in here, really are because plugging we the not in are it do is prospects, that. about optimistic we just mid-term value whole short about and long-term position a building

So, not enough outside expect ads our we execute from strategy. labs a see to from – that resources well. flow pipeline but would than to labs, hopefully And have more own of I if as continuous from

Phil Johnson

thanks go caller the Kevin, if please. next Dave. can Great, we to

Operator

ahead. Please line question America. next The Jason from Gerberry, the of go is Bank of

Jason Gerberry

question questions. my taking Humalog. guess just for first on Thanks I

on the parity curious And just the now the do You've just estimates. of the on, half your business? where of gotten are can and multiple or to second year represent Thanks. question, thoughts of galcanezumab. be half but in moving out on a seems will rebates, payers talk benefit I going this of think guess, in second changes But favorable. pretty you comps get they to launch my the, the the Amgen first The for feedback then forward opt CGRP CGRP in I'd terms cover just you into on stage then you how competitive biosimilar to of be you kind terms the that think exclusive agents from source really and competitor pressure the evolving or that of are do are at contracts about space comfortable gate? you XXXX, meaningful won’t to par

Phil Johnson

or am the Enrique if to Humalog, for questions. to not handle I want for you may you Dave, will we’ll you it…? go thank Jason, sure

Dave Ricks

start I’d [indiscernible].

Phil Johnson

Enrique? Absolutely.

Enrique Conterno

Sure.

benefit So, – relative X was to QX in the Humalog the and a We had points, previous for in benefit. discounts. year estimates due That an about so important changes rebates quarter. was did have an to benefit excellent

for Now, forward, able difficult mix. bit also when project to benefit is comes as to of to we we it seeing us it – a but a are be

the at franchise. the Humalog So, insulin is look different for for we segments, when which a positive

will share us we as in Medicaid, relates for have access basically forecast what this to managed and us be for particular it type the uptake in but will Clearly to would to gaining difficult area the of able to is how to difficult them predict predict basically the and XXXX. it's point-in-time Now, it in very of see as competitor we in market. at play – Admelog,

Dan Skovronsky

Great.

the the in early know you to the migraine relates mostly listed here. it category, As days pretty assets new therapy. understand payers it I is haven’t

guidance early reading that with conversations them, FDA broad the data We’re of I from our to tell feedback in about is given and appropriate medications which you strategy of for access payers population. as and and particularly our seeking these what could kind is, the course

and to the just mention and which women are and mostly absenteeism, not predict causes are working schedule these having lack who to ability our month of population, suffering between anywhere So, commercially insured, that plan, debilitation, headaches X cost. XX human study a is

So, class. your covering be payers we a coverage. pricing category some to through. in will conversation with will for term that outcomes-based need could have great to think employers be value add? and interested approaches, anything very we're long It good optimistic the Enrique, from message have We do you get this that and class

Enrique Conterno

new this working No, we and to very represent would are actively to broad I excited think for product we the about ensure opportunity try that us are access.

Phil Johnson

Great. Thank you. Kevin, next caller please.

Operator

Please ahead. Cowen. Next, go we Scala, Steve have

Steve Scala

several you, Thank questions.

this a the XXXX as you. of any likely, Thank headache you the resulting filing chronic demand? a Are of cluster in the Taltz. filings restocking miss early then formulary quarter XXXX they second why lastly, headache and much in the cluster was XX%, performance change First, in not down or is on do in underlying is not result the stellar so trade how a inventory anyway? have it table, is similar versus Second, on reading of episodic was events XXXX positions QX, discussions? setting In there in is galcanezumab step

Phil Johnson

strong ahead on short we'll We up being but for later we can if Okay, a be you if the the on would give also the I’ll have a least at provide Steve. a answer with galcanezumab maybe answer if go Christi And sure not QX. to the you. QX, for Enrique question and for needed, question I’m formulary [ph] comment Taltz follow filing XXXX on for comment cluster. ill happy then on and to you like

Enrique Conterno

I Taltz short QX is when answer that is performance we demand think driven. look the at really

derm both seen on in prescription rheumatology. our trends across have improvements and We

typically encouraged with XXXX. for focus specific Taltz on So, the not we do performance. formulary are We very comment

Phil Johnson

time next question saw this point of to with pleased results that certainly in such the And comment and making cluster, and galcanezumab we but potential on X Kevin, the not we filing. those can the any regulators for for a if in will your timing go Steve on with Phase very studies kind caller discuss or are please. filing

Operator

And Raffat ahead. Umer that will be at Please go Evercore.

Umer Raffat

minimal bit at to share. Novo so Hi, someone question a on thanks three basically influence, level and it brought relates make product market, specific has the when much my for a as to wanted may, Dave, rebates I and I taking and I it I early had I my Lilly if look was, guess it first, well split up and questions. as Sanofi mealtime more

are much. long. from to - conversion to rate on your on mealtime foresee And So both more plus a more do the And you rebates then your they prior do and my was is are question what know any you R&D, trial on in tanezumab, And player IL-XX, we becomes first. and any where in R&D Sanofi of maybe have ongoing Thank also in you label second meaningful PDX X of insulins? on very Type third observation X IL-XX, trials first that’s on So, Type trials? date? scenario RPOAs X Phase that from open

Phil Johnson

mealtime can't or for any or a comment. from on become on the to from Raffat, data if Sue the I'm for in if asked Umer, conversion it's Dave, to my maybe, X thank question to RPOA about what the own you you read you on actually you'd IL-XX. And Enrique, sorry, Oh, we player X. Dan scratch tanezumab. want for And question. first chicken possibilities then, insulins? to I comment like Dan, meaningful if like comment Sanofi Maybe maybe you'd see to RPOA

So, with start you. Enrique, I'll

Enrique Conterno

speculate be - so insulin what but what think, - mentioned to think Sanofi's to competitive be do the I sort products when this, the as changes Yes. we track I mealtime structure is that Clearly, But difficult would The very premise of the It's would some forth. and uptake minimal. and of space. different change. result far, the very question a dynamic of the was already under rebates in a a it it's so and comes Dave

Phil Johnson

Thank to Great. want start you Sue, Enrique. question? the you, on IL-XX

Sue Mahony

sure. Yes,

data, Phase and We two the second are rate one you as in enrolling. the currently - studies the mentioned, line. year. with response seeing have both line X dose and endpoint next The that is we’re those anticipating front IL-XX, Those in one -

Phil Johnson

or Dan, want Thank Sue. are to add Great. you… you, you do anything,

Dan Skovronsky

It’s fine.

Phil Johnson

Okay. And tanezumab then on the question?

Dan Skovronsky

Yes.

rates experiences. comparisons, I different knew differences, quite around what really we to question there's seeing tanezumab RPOA your the conversion interest for way in understand kinds in And since lead future in avoid past events, thorough. and comparing trial. of which of trial trials. that and we're and I from current X there's think, be about important us the X know what understandably trials So, But will with should RPOA adjudicated I this screened those is looking this a that in primarily we much with into previous some of lot for, events more

this to. With not details in So, we meeting. time. past regards But this more future have to a to happen disclosing compare any trial, that at don't relevant data from we're the current should point in

Phil Johnson

Dan. next please. caller, Thank you, Kevin, Right.

Operator

ahead. Next Credit Please from Vamil go Suisse. Divan, is

Vamil Divan

so much taking for Thanks question. Great. my

on quarter. pretty on the this So maybe the is One, side. just performance oncology two good Verzenio,

a to Kisqali? Just on you update getting or Verzenio And more data label little second patients include if the one, relative give color Alimta, keynote open are to you this mentioned have which then on can to IBRANCE you're XXX year. later to

in that you in adoption uses with if terms frontline practice on Keytruda of regimen the comment setting? can date, you're in of combination in Alimta Just Thanks. what now which to seeing

Phil Johnson

for the Vamil, you question. thank

Alimta and Verzenio both on you for updates. Sue, So,

Sue Mahony

XX.X%, $XX.X question. Sure. last so What seeing was update that's quarter, this quarter. for see third-to-market to The this on today. new TRx. continue pleased increase. NRx, in and know, to the with our Yes, of are million, brand that Yes, as NBRx in is, we’re increase terms we both and the second you In really $XX quarter now million also sales was thanks the but CDK, Verzenio we're we're we a so versus share

with they pleased the are uptake. physicians it. using we're when the What is we seeing brand, So, are like

ensuring get we is continue trial focus Verzenio. of our that to So, in

across X,XXX so fulvestrant. who uptake now and frontline. Verzenio. they're do have using physicians have activity. see far, that in And have more starting spectrum The frontline to in we But is the about in much mainly we’re in really, single-agent the we patients the trialed And some

with line clinical clearly concerning think is interested, activity is continuous in are and fact fulvestrant. the well characteristics. who’ve So, patients dozing. that People in And data The single-agent got see inhibitors aromatase the also things is the differentiator. a resonating resonating with the data I as positive as we the second that in are

pretty we've far growing about now label. are that Verzenio. to We CDKX/X continue opportunity XX%, for the now So, uptake uptake to only the grow in got so about Alimta, good in getting - The of is about XX% KEYNOTE-XXXG we we still in a see inhibitor. to feel data and market the the brand. and regards patients data With is -

data. we’re FDA to the the are as KEYNOTE-XXX include you we heard, seeing in growing What submitted the Alimta also is, have to We U.S.

new volume, We presented prescriptions. so time, we are data X% have since price, at only in based a And that fairly an increase ASCO recently, X% patient although on the seeing X% was growth overall.

regime that as we'll sort that a We promoted of now. see is Alimta in continue about forward. the in clearly in Alimta sort the is the an that do seeing addition we - also Alimta have we're the So, XX% of to typical of sort of use areas. of reminder, going we've believe in increase and to for But use KEYNOTE-XXX use use some

Phil Johnson

caller, please. Great. Thank you, Sue. Kevin, next

Operator

Cantor. go the Please is Chen, line of Louise ahead. from Next

Louise Chen

question. for thanks my Hi, taking

confidence the just robust So, if stat it's for was, first sig question in trial Trulicity stat versus gives And you side not growth with what tanezumab. had profile trajectory sig, of that that REWIND can to I will your And How on for alternatives question still do balance Trulicity? even you you hit non-inferiority the opioids? need think the see will the just effect versus Thanks. FDA second was currently? you back continue drug

Phil Johnson

Louise, Great. to welcome the call.

for to the like then, Enrique? tanezumab. Dan, handle And Enrique, the question if over to you on for REWIND. So, question you'd

Enrique Conterno

months. last is at having Trulicity having growth. is the XX%, but is Clearly, growing today share continued Trulicity fast the few market very So GLP-X fantastic also over growth

quite have access an the look patient an that and Trulicity real-world at position when excellent we efficacy frankly, unmatched experience We delivers.

and adherence very at look patient simply we'll delivered. So,

trial trial appropriate we Clearly, the is excited believe very and way. we've So the the of REWIND, we performance before, as an said designed this us, product. about core important in for that

fairly be going going the patients that by the short end of have long, - to product. average of the Trulicity. product. expect five trials are expect other a for on is We be year. would But we on we're years This we the to differences versus the time top the It's line a over not that one is the and patients sometime on REWIND

So, results the trial. not we this the to speculate. look we're point But forward time, to of at in going

Phil Johnson

Enrique. Dan? Great. Thank you,

Dan Skovronsky

strict the question the said the broader opioid alternatives drug benefit, they're of was to of tanezumab. slated this risks patients the with Yes, in societal your of need here chronic is settings. crisis variety But sort course, demonstrate current and of the for a priority trials of impact Pfizer, non-opioid for for here in that, Having about with our pain.

future the decided the in to years by also That's that the ago reasons that. one of the of excited the see for course, we're portfolio, Of we reasons several pain we potential tanezumab. one of invest

crisis in for pain play the will there new how versus the see solve molecules we that important And regulators opioid to we between that I think interplay an important. have is helping role think problem.

Phil Johnson

Thanks, Dan. caller. next Kevin,

Operator

And from a Scala, do go ahead. Please we Cowen. Steve question have

Steve Scala

Back REWIND. you. on Thank

the such Germany line top stated change year-end, call, a press data? a that has anything been in Verzenio, completed in the if but in allowing ruling could said a you just the there as I’m change in been it study so QX. no was when there see Thank Enrique, Secondly, On QX the launch? the update you. in on in we release might has March, generic lastly, market, Alimta, Phase on X had MCL anticipated timing? early And does wondering then be

Phil Johnson

the question. Great, for Steve, you thank

for came back you Alimta REWIND Verzenio Phase Germany to we to the and ruling for when So, X the for and then the follow-up, MCL. Sue, you and

Enrique Conterno

has There timing. in no been change

We in QX. expect that the top line would be released

Phil Johnson

Okay, Thank you, great. Sue? And Enrique.

Sue Mahony

- we're regards we to Germany, place. having in junctions Alimta Yes, with

to say what to hard the regards go is hard So, it's really that. but mean, may I at with to generics. really regards to some risk, say it's with situation

Phil Johnson

And for then Phase Any on X wrap-up. for have Verzenio, thoughts forward? MCL we the MCL plans going

Sue Mahony

not that to that, get I’m the get Yes, one. on you to regards that back publication to to have I'm back one. going you the we’ll plans on but sure with certainly to on

Enrique Conterno

about our just Great. And to $XXX Germany. QX $XX of results, for also of than sales were place then less European in Alimta context that million million from came

Phil Johnson

to Kevin, if we we’re have take happy well, another caller, the question.

Operator

Next will BoA. your open Hima Please ahead. open. be this is at time. Hima line Inguva, And Inguva, your is go line

Hima Inguva

me hear Can, you okay?

Operator

Yes.

Phil Johnson

Yes, we can.

Hima Inguva

Okay, a in up asking Elanco great. transaction expect potential On Slide But those you the you're Thanks question. very a terms much and to this for for debt do IPO, X, Lilly? event of details. taking the be offering prior indicating to not levering

Phil Johnson

if you cause question the to to would in actually what Josh, of lever terms want up. So, to Lilly respond

Josh Smiley

before that XX% point that obviously the offering at this less we - Elanco’s IPO debt launch that on of will sits the intent to books. over the is do time So, than

be I capital allocation flow, do of over we tax reform. to function think, priorities Lilly’s basically a if you expect as look and cash levered time at more

in And need overseas trapped and that reform, You'll where position effect had could has were we prior freed recall how use up, it. was cash to to was that we it a as tax keep that much we we don't in cash. restricted in

So, see a you on into position. Lilly moved basis a in net QX, fact, And, net to levered. expect more debt we in be should

a we're cash happen what will So, flexibility our structure, that able Elanco, and it’s a use over capital of of much an and with time as manage normalize gives will now issue to because more the less us around function which is more - world.

Phil Johnson

a And that EBITDA, be separate our to should this we role lose reduction amount a debt. would would a When new to of Phil. my occur, as we Treasurer. get is there plan, I our would not certain significant which is Elanco

of kind be in Kevin, callers maybe forward. Lilly's increase numbers a very queue? change point moving would a there the we to terms debt XX leverage that have have So, in the in EBITDA modest we minimal of more do any basis

Hima Inguva

That's very Thank helpful. you.

Phil Johnson

are You welcome.

Operator

question in time. at queue further No this

Phil Johnson

Dave. Excellent. Thank much, very you

conclude some and If go to comments. the like call with you'd ahead

Dave Ricks

appreciate earnings Lilly We and Company. today's call and in your in Thanks, interest Eli your Phil. participation

in to Our to strong compound from XXXX. in ability growth and us a XXXX makes revenue our growth confident margin increasingly operating X% XX% first-half XXXX achieve deliver to

While growth our depth continue for accomplishments to first-half our beyond highlight and XXXX. prospects pipeline the breadth of

addressed on and we our capability concrete focus Elanco, IR continue create most margin strong to resources with for demonstrated serve for diverse to you our a capital believe if take our expansion, on and a Please call. to a day. a to to Lilly great opportunities in. stakeholders. by As new growth, R&D compelling have With best be and Everyone, a clear questions path the investment. product we've of team continues have actions decision our our customers again, Thanks, to dialing drive set not follow-up allocate recently we value

Operator

to available you. Eastern and and starting gentlemen, XX.XX will July today conference Thank XXXX. be it run Ladies AM will of XXth at for replay that’s time this

with dial may access code AT&T XXXXXX. with calls XXXX-XXX-XXXX XXXXXX. XXX-XXX-XXXX may You the code playback service access executive dial code the International the by dialing area

a you now day. We for may thank you and that conclude conference. Now Have good does do your joining, disconnect.

Eli Lilly and (LLY) 24 Jul 182018 Q2 Earnings call transcript