Ladies and gentlemen, thank you for standing by. Welcome to Bayer's Investor and Analyst Conference Call on the Q2 2021 results. Throughout today's recorded presentation, all participants will be in a listen-only mode. The presentation will be followed by a question and answer session. If any participant has difficulty hearing the conference, please press the star key followed by zero on your telephone for operator assistance. I would now like to turn the conference over to Mr. Oliver Maier, Head of Investor Relations of Bayer AG. Please go ahead, sir. Thank you, Emma. Good afternoon, everybody, and thanks for joining us today. I would like to welcome all of you to our Q2 2021 conference call. With me on the call today are Werner Baumann, our CEO, and Wolfgang Nickl, our CFO. The businesses are represented by the responsible management board members. That being said, Werner will begin today's call as usual, with an overview of the key developments in the Q2, and Wolfgang will then cover the performance of our businesses as well as the outlook for 2021 before we open the Q&A session. As always, I would like to start the call today by drawing your attention to the cautionary language that is included in our safe harbor statement, as well as in all the materials that we have distributed today. With that, I hand it over to you, Werner. All right. Thanks, Oliver, and good afternoon, ladies and gentlemen. It's my pleasure to welcome you to our conference call today. In the beginning of the year, we promised to set the stage for growth. We are very pleased that actually all our businesses show currency and portfolio-adjusted double-digit growth in the Q2. The strong growth trajectory is also reflected in the company's H1 2021 numbers. Given the market fluctuations due to the pandemic and the seasonality of our business, our year-to-date is a better representation of our underlying performance and strong growth momentum. In Crop Science, the positive market environment has sustained strong commodity prices for corn and soybeans have led to a strong top-line development. In Pharma, our blockbusters, Xarelto and Eylea, continued their growth momentum. We also saw an overall significant recovery of elective treatments, and our Consumer Health business continued its path of leading growth and margin improvement. We expect continued positive dynamics across all businesses for the remainder of the year, and hence, raise our guidance. Needless to say that the pandemic and the related effects might provide for further volatility, which needs close monitoring. Let me now come to our objective to progress our late-stage pipeline this year. With our recent approvals, we are looking at a significantly de-risked new product pipeline. The rollout of NUBEQA is ongoing and continues to exceed our expectations. We also advanced the launch of Verquvo, our new symptomatic chronic heart failure treatment. Following the FDA approval in January, we received market authorization in the European Union and Japan. Kerendia, our treatment for patients with chronic kidney disease and Type 2 diabetes, is the last addition to our launch products. The recent FDA approval offers a new path to protect patients from further kidney damage through addressing MR overactivation, a key driver of chronic kidney disease progression, which is unaddressed by currently available therapies. From a strategic perspective, it is also important to note that we are now re-entering the U.S. market commercially with our own marketing and sales organization in this indication. I'm sure you've also seen yesterday's good news on our eliapixant, our P2X3 receptor antagonist. The phase II-B study in chronic cough has been positive and shown efficacy and an excellent safety profile, which makes us very optimistic for this new treatment option and also the running phase II trials in other indications that are underway. Let me now touch on some further highlights in our early programs and platforms. We are making great progress on our early-stage pipeline with our cell and gene therapy platform. Through BlueRock and AskBio, we are working on a two-pronged approach to treat Parkinson's disease. For the first time ever, it might be possible to stop and reverse this degenerative disease and truly help patients with their high unmet medical needs. We are very proud to share that BlueRock successfully administered the first dose of its pluripotent stem cell-derived dopaminergic neurons to a Parkinson's disease patient in their phase I clinical study. In parallel, AskBio is driving forward a gene therapy program based on adeno-associated virus or AAV that is currently recruiting and evaluating patients in an ongoing phase I-B clinical study. The start of clinical trials bring us one step further to the potential of a truly breakthrough treatment option to dramatically improve the lives of patients suffering from Parkinson's disease. Last but not least, we are also strengthening our drug discovery capabilities with the acquisition of Vividion Therapeutics. Vividion is a U.S.-headquartered biopharmaceutical company utilizing novel discovery technologies to unlock high value, traditionally undruggable targets with precision therapeutics. Vividion's technology is the most advanced in the industry, and it has already proven its applicability pre-clinically in oncology and immune-related diseases with potential to expand into other and additional therapeutic areas. We have already diversified our modalities portfolio with our cell and gene therapy platform and continue to fuel our pipeline with breakthrough innovation by acquiring Vividion. Stefan can provide more background on the acquisition of Vividion Therapeutics later in the Q&A. With that, let me hand it now over to Wolfgang. Thank you, Werner, and ladies and gentlemen, also a warm welcome from my end. I will walk you now through our business performance for the Q2 and the H1 of the year, followed by our financial outlook for fiscal 2021. Please note, when I mention sales development, I'm referring to portfolio and currency-adjusted numbers unless otherwise stated. Our sales grew by 13% to EUR 10.9 billion in the Q2, with all of our businesses contributing double-digit sales growth. Currency headwinds did, however, impact sales by EUR 524 million. Our EBITDA before special items declined by 11% year-on-year, coming in at EUR 2.6 billion with an adjusted EBITDA margin of 23.7%. Foreign exchange effects of EUR 153 million weighed substantially on our EBITDA before special items. The year-over-year swing in provisioning for variable compensation had a negative effect of EUR 467 million. I will elaborate more on this shortly. We also had higher costs of goods sold, specifically in pharma and Crop Science, and invested in product launches, especially in pharma and Consumer Health. Our core earnings per share in the Q2 came in at EUR 1.61. This is a 1% increase versus the prior year quarter, despite a negative foreign exchange effect of EUR 0.10. The improvement in our core financial result from minus EUR 343 million to minus EUR 115 million was a key contributor to our core EPS performance. This was largely the result of valuation benefits for one of our Leaps investments, which went through a very successful IPO during the quarter. Our core tax rate came in at 24.4% for the quarter, up from 23.3% in the prior year quarter. We continue to expect it to be around 23% for the full year as guided. Earnings per share decreased to minus EUR 1.48, mainly impacted by special items of EUR 3.53 that primarily relate to the adjusted gross glyphosate provision of $4.5 billion or EUR 3.8 billion that we discussed last week. Non-cash impairment charges in our Crop Science division of net EUR 437 million and the usual adjustment for acquisition-related amortization contributed EUR 1.04 to the decline. The tax effect was a positive EUR 0.56. You can find the bridge from core EPS to reported earnings per share in the appendix of our presentation. Our free cash flow came in at EUR 1.2 billion in the Q2 of 2021. This compares to EUR 1.4 billion in the previous year. A strong underlying cash flow profile was masked by litigation-related settlement payouts of about EUR 900 million. In line with our typical quarterly profile, our net financial debt increased by EUR 428 million to EUR 34.4 billion in the Q2. Strong operational cash generation and currency effects kept the increase to a very modest level and could largely compensate payout of dividends and litigation settlements. Let's look at the H1 of the year next, which we believe better reflects our performance after considering seasonality and pandemic-related dynamics. Group sales grew by an impressive 7% to EUR 23 billion. On the earnings side, however, our EBITDA margin, our EBITDA before special items rather, declined by 8%. The decrease is mainly driven by massive currency headwinds of EUR 490 million and higher provisions for variable compensations of EUR 534 million. This year-over-year swing effect significantly impacted the bottom lines of the businesses and the reconciliation. Given that our performance is linked to growth, margins, core earnings per share, and free cash flow, you will recall that we significantly reduced our provision for variable compensation last year as a result of the pandemic-related shortfalls. We already mentioned in February that we would essentially restore our cost profile this year. Now with the good performance in the H1 of the year and our improved outlook, we increased the provision. Note that the Q2 is the most affected, mainly due to the seasonality of the business. Core earnings per share came in at EUR 4.20 and decreased slightly by 1% due to the effects on EBITDA before special items described above, which were not offset by an improvement of our core financial results by EUR 336 million. The core tax rate for half year one came in at 24.3% compared to 24% in the previous year. Our free cash flow in the H1 of 2021 fell to minus EUR 2.1 billion and was heavily impacted by net settlement payouts of approximately EUR 3.1 billion. I would now like to give you some more color on the performance of our three businesses in Q2. Our Crop Science division delivered double-digit sales growth of 11%, driven by all regions. In particular, Latin America and Asia Pacific were up significantly, growing 18% and 12% respectively. While North America contributed the most on an absolute basis with a 10% growth. Regarding our strategic business entities, herbicides and fungicides were the main growth drivers in the quarter. Sales of our fungicide platform increased by 23%, relating primarily to volume gains of Fox Xpro in Latin America, as well as new product launches in North America. Our herbicide segment also continued its growth trajectory and grew by 16%. The segment benefited from higher sales of our XtendiMax herbicide and price increases of Roundup in North America. For insecticides, growth in Latin America and Asia Pacific was insufficient to completely offset the impact of the loss of a thiacloprid registration in EMEA. We held our number one position in weed control in soybeans in North America with our Xtend system and delivered 9% sales growth in our soybean seed and trait segments. Growth in North America was volume-driven, resulting from both higher acres planted and the benefit of excess seed sales. Corn seed and traits also displayed sales growth of 9%, with expansions in all regions, most notably in the Americas. On the earnings side, EBITDA before special items declined considerably by 25% to €1 billion, despite price increases and volume expansions. Significant negative currency effects of €111 million in negative sales mix and higher costs, most notably in our COGS, with increased raw material and freight costs, negatively impacted the bottom line. For our Pharma division, sales expanded significantly by 16% to €4.5 billion. Our two blockbuster drugs, Eylea and Xarelto, continued their strong performance. Eylea sales grew by 27% due to strong demand in Europe after the prior year quarter was heavily burdened by the impact of the COVID-19 pandemic. Xarelto displayed 13% growth, driven mainly by high demand in China and Russia. In the area of elective treatments, we benefited considerably from the recovery from pandemic-related restrictions as COVID-19 heavily impacted our prior year quarter. As a consequence, the IUD franchise grew by 68%, and our radiology business by 37%. Due to the annualization of the volume-based procurement impact on Glucobay and Avelox, as well as strong growth of Xarelto sales in China rose by 22%. The successful launch of NUBEQA supported our business performance in the Q2, as Werner already mentioned earlier. Regarding our bottom line, launch investments, higher COGS, higher incentive rules, and the negative currency effect of EUR 26 million were more than offset by strong sales growth, resulting in a 3% increase of our EBITDA before special items. I will close out the divisional update with Consumer Health. Our sales were up significantly by 13%, driven by growth across all regions and categories. In the context of an ongoing volatile market environment, we continue our path of profitable growth by executing our strategy. The Nutritionals category continued its strong growth momentum and grew by 16% due to sustained high demand. Allergy and Cold returned to growth after being impacted heavily by a weak flu season and ongoing COVID-19 related lockdown measures in prior quarters that particularly burdened our cough and cold products. This quarter, however, a strong allergy spring season in North America led to 16% growth for this category. Growth in North America was also supported by the launch of Avelox, where we entered the topical pain treatment segment. Dermatology benefited amongst others from line extensions of Bepanthen in the dry skin segment, growing by 6% in the Q2. All these positive developments underline our well-balanced category and geographical portfolio. We increased our clean EBITDA margin by 50 basis points to 21.6%, driven by strong sales growth and disciplined cost management, clearly offsetting the impact from launch investments and negative currency effects of EUR 20 million. Let's move on now and look at our guidance for the full year. As we've outlined before, we have seen a strong growth trajectory throughout the H1 of the year with contributions from all three of our businesses. We are optimistic that the positive market environment in Crop Science and the good growth momentum for Pharma and Consumer Health are sustained for the remainder of the year. We therefore raise our guidance, notwithstanding that the pandemic continues to increase volatility in the markets. Please note that our guidance is based on constant currencies, or in other words, average actual 2020 exchange rates. The outlook at constant currency is shown in the light blue box in the presentation. In the very left column, you can see the full-year outlook we gave back in February. Right next to it, you see our updated guidance as of today. We increased our guidance for group sales from previously EUR 42 billion-EUR 43 billion to now approximately EUR 44 billion, with increased growth rates for all businesses. Our EBITDA margin before special items is anticipated to come in slightly lower than guided in February at 26% at constant currencies. For core EPS, we increased our outlook and now expect core EPS in the range of EUR 6.40-EUR 6.60 at constant currencies. Previously, we had guided between EUR 6.10 and EUR 6.30. We expect to reach the upper end of the guidance in case the very favorable core financial result is sustained throughout the remainder of the year. We forecast to keep our core tax rate at approximately 23% for the full year. Our free cash flow guidance is raised by EUR 1 billion to between minus EUR 2 billion and minus EUR 3 billion, including anticipated payouts for litigation settlements of approximately EUR 7 billion, which is EUR 1 billion lower than what we had anticipated in February. Consequently, we improve our guidance for net financial debt to approximately EUR 36 billion versus the EUR 36 billion-EUR 37 billion in our February guidance. Let me add that the acquisition of Vividion Therapeutics is not yet considered here. In the gray box on the right, we provide the currency impact for the fiscal year 2021, reflecting currencies at 2021 month-end June spot rates. The last column on the right depicts our guidance at month-end June rates. We now expect a negative currency effect of approximately only EUR 1 billion on our full year net sales, which by and large materialized in the H1 of the year. The impact on core EPS is roughly a negative EUR 0.40, which would bring our outlook to between €6 and €6.20 using June month-end spot rates. We have listed the updated guidance for our businesses and other major KPIs in the appendix of our investor deck. With that, I'll hand the call back to you, Oliver, to start us on the Q&A, please. Thank you, Wolfgang. Thank you, Werner, for your comments. Emma, I think we are ready to open the line for the questions now. The first question comes from Mr. Leuchten. Please state your name, company name, followed by your question. Thank you. It's Michael Leuchten from UBS. If I could start with the Crop Science division and the lack of margin gearing, please, especially as Q2 was heavily impacted by the STIs as you outlined. First question is, can you quantify the inflation pressure on input costs for us? How will this develop into the H2? More importantly, how much of this can you recapture if 2022 happens to be a normal year? Related to that, given that 7% top-line growth in constant exchange rate does not give you more than 24% EBITDA margin this year, how confident are you that with consensus sitting at 26% margin for 2022 for the division? A question about equity ratio. The equity ratio was below 27% in H1. Where does that go from here and what are the buffers? Is there a level where that ratio becomes a problem for you? The third question on Kerendia positioning. Now that you have approval, I was wondering if you could talk about your launch plans and market segmentation, if you could. Thank you. Right, Michael. Thanks. Liam is going to take question one, followed by Wolfgang on the equity ratio, then Stefan is going to talk about our launch plans for Kerendia. Thanks a lot, Michael. Maybe let me start with your last question towards me on our confidence in the midterm targets, which we had given out as the 27%-29% EBITDA range in 2024. I'm very confident about our ability to reach these targets, and I'll try and explain that now by giving a bit of color on what's happened in Q2 on the margin side, and why we're very confident we can achieve our guidance for 2021. Also explain a little bit some of the transitory impacts that are in there that will help give you a better sense for what could be happening then in the future. If we break down Q2 at the margin impact on Crop Science, that there's in essence three things happening here. One is FX. If we just leave out the FX, which as noted it is EUR 111 million, there are two big elements to the margin decline. One of them is phasing effects, which I will touch on, and one of them is related to higher costs on product mix. About half of it is phasing effects, and about half of it is related to higher costs on product mix. These phasing effects become positive effects in the H2 of the year. I think this first point is very important to understand. What these phasing effects are is in essence, you recall last year when we had the very special COVID situation, we had very significant seed returns and licensing true-ups in Q3 of 2020. This year, in a much more vibrant market situation, we've had these true-ups already in Q2. This in essence hits our Q2 result. It helps our Q3 result because we won't be having those true-ups then. Second part is there's a shift in licensing income, which last year we got in Q2. This year we will get it in Q3. The sum of that is in essence half of what the margin decline is. This comes back in Q3. Just to flag that to you very transparently. The other element, the other half is a mixed bag of higher costs and product mix. Product mix, we flagged a little bit in the past. We had lost an older corn license expiry, which is a higher margin for us. We lost here thiacloprid and neonicotinoid in Europe registration, which is a high-margin product. This simply has ways to a degree on our margin, but it is a transitory effect, of course, because you take that hit one time and not on an ongoing base. We have the higher costs, which are in essence two elements. One of them is our short-term incentive, which Wolfgang alluded to, where there is this swing versus last year and because of last year, very poor performance this year with a much stronger overall performance projected for year-end. The second one is related to a degree, a reversal of contingency spending. Last year in the COVID situation, we of course clamped on the brakes as many companies did from a spending point of view. We don't go back to what the original spending was, but for sure, we do have some additional investments both in R&D and on the commercial side, if you think of the fact that we're also launching consistently new products. There's a bit of a one-time effect there. Again, this is a transitory impact. The bigger part of those costs have already been incurred in the H1 of the year versus the H2 of the year. The third element is COGS, and this is largely material cost and freight. Here as well, I think it's important to understand a lot of our growth in the H1 of the year was driven by heavy volumes of particularly herbicides and fungicides. On the seed production side, our production costs are hedged. Our COGS on the crop protection side are simply more impactful. As we go into the H2 of the year, our growth is going to be driven much more by pricing upside. You will see this across the board. In essence, what you're going to see is in the H2 of the year, a significantly higher margin than what we had in the H2 of last year. That gives us confidence or a lot of confidence that we can achieve our 24% EBITDA guidance for this year on a constant currency base. Because a lot of those effects are transitory, you would expect then going forward, to see margin lift. That's why we're confident that we can achieve our 27%-29% guidance range. Okay. I'll continue on the equity ratio. Michael, hello and thanks for the question. Absolutely right. Equity ratio reduced versus Q1 from 29%- 27%. At the year-end, it was, by the way, 26%. In absolute terms, that means from about EUR 4 billion, from EUR 35 billion- EUR 31 billion. You can attribute about half of that to the dividend that we paid out. That's obviously coming out of equity. The other half on the reported loss that's driven by the provision, the incremental provision that we talked about last week. The balance is EUR 31 billion on the balance sheet. I'm not concerned. Even more important than whether I'm concerned or not concerned is whether the rating agencies are concerned. You can assume that under NDA, of course, we've talked with them about the legal complex and also the exciting acquisition that we announced today. You have seen Moody's coming out confirming already. I think they do understand that we are laser-focused on this. We think we are in good shape there. We continue to be absolute committed to the net financial debt in 2024 of EUR 28 billion-EUR 30 billion. With that, a significant reduction in leverage. From that perspective, I'm not concerned, Michael. I think the next one was for Stefan? Yep. Stefan. Yeah. Hi, Michael. Thanks for the question. First of all, we're super excited about the broad FDA label for Kerendia that was granted following the FDA review. May I be more precise, priority review of the FDA. The label really recognized the renal and cardiovascular outcomes in the pivotal FIDELIO-DKD trial. You were asking specifically to what our entry strategy is here. Let me maybe preface by saying that we're looking at worldwide more than 160 million patients that live with chronic kidney disease and type two diabetes. This is a significant opportunity with an even more significant unmet need. Our mechanism of action is well known to kidney specialists. So far they didn't have a medicine that they could prescribe with this indication and because of side effects. We really think that we have the kidney medicine. The kidney medicine means we have the product that is designed to treat kidney with five different indications. Let me just remind you how broad our label is and the indications that come with it. We are indicated to reduce the risk of sustained eGFR decline. We are indicated in end-stage kidney disease to prevent cardiovascular death. Non-fatal myocardial infarction and hospitalization for heart failure in adult patients with CKD and Type 2 diabetes. An incredibly strong label. If you think about this, we are going to go in initially targeting specifically nephrologists, endocrinologists, and a select group of primary care physicians. To add to that we have also the FIDELIO data that you have seen top-line information on, which is going to be presented at the ESC meeting next month. The FIDELIO data really, I think, pooled with the FIGARO data, makes our case even stronger. We really feel very good about this. The launch is ongoing now in the U.S. We should have commercial presence in doctors' offices towards the end of this month. That's the start that we're looking at. Thank you. The next question comes to the line of Mr. Andrews. Please state your full name and company name, followed by your question. Hi, Vincent Andrews from Morgan Stanley. Liam, I wonder if you could give us some more detail on the Intacta 2 Xtend launch in South America this fall, and in particular, the price premium maybe that you've been able to establish over the Intacta1, and if there's any improvement in your contractual ability to take price in the coming years as needed against foreign exchange or costs or anything else. Also, how big of a launch do you anticipate? Sort of over what period of time do you think Intacta2 will be able to replace Intacta1? Liam? Yeah. Thanks a lot, Vincent. We have all the approvals in place and are in the process now of ramping up for launch. We expect to be on 600,000 acres with Intacta 2 Xtend this season. This is the initial goal in the early phase of launch. Of course, what we're working on is, and the plan is, to shift our Intacta franchise to Intacta 2 Xtend over time. As you know, on the Intacta franchise, we're on over 85 million acres in Latin America. There's a tremendous potential in here. We have been able to improve the contractual situation around pricing, which as you know from the past, was linked only to inflation. Beyond inflation, there was no ability to increase prices. This is being adjusted. The initial price increase for the launch phase over Intacta is about 5%. It's a mid to high single-digit increase. Somewhere between 5% and 8% increase is what's in the initial launch phase now. Okay. If I could just ask you on the U.S. season and how that played out. It would appear from the corn and soy sales numbers that you had strong price realization in corn, which I suspect was more a reduction in promotional spending than changes in list price. How do we think about that going into next year, where I would assume you're going to have an increase in seed production costs that could be quite sizable. What is your confidence that you're going to be able to price well in excess of that increase in production costs? Yeah. On corn, as you know, for last season, everybody had priced ahead of the run-up in commodity prices. We have the opportunity now in the new season to price again. We will be issuing our price cards in the next two weeks, actually latest by end of August. Within August, we'll be issuing them. You can expect a significant price increase. This is corn U.S. I'm talking about. On the corn production side, we're actually hedged to a large degree. Our goal is always, anyway, from a pricing point of view, whatever increases there are going to be in cost of goods, that we pass this on to the market. This is just a basic philosophy that we have and that we're pretty rigorous on implementing. You can expect to see a significant price increase going forward. Excellent. We'll look forward to that. The next question comes from Mr. Jackson. Please state your name, company name, followed by your question. Hi. Good afternoon. Joel Jackson, BMO. I want to talk a little bit about crop protection pricing and as it relates to some of the trying to pass through the higher costs you're seeing. Higher inflation. Is it easier, has it been easier to pass through the cost on the lower margin, lower priced products like glyphosate? Are you finding on the higher priced technologies in your crop protection portfolio that it is a more competitive dynamic and is harder to pass the cost inflation off with higher pricing? Let me try and give a bit of color on this, on the CP pricing, and of course, Joel, as you know, very different by region. Actually, across the board, we would be expecting to be passing on, again, increases in COGS. We need to pass it on to the market. The issue is, of course, you have a time lag between when we purchase materials, go through the whole production process and product inventory, and then by the time it's sold, there is this inherent time lag that we simply need to deal with versus something like freight as well, which is immediately visible for us. Overall, we've actually seen very strong price increases for glyphosate because you mentioned that specifically. Our pricing for glyphosate is intricately linked to the price of acid in China as kind of the basic raw materials for glyphosate. Because of shortage of supply in China, this price has gone up significantly, and with that, our market price has also gone up significantly for glyphosate. We're very flexible in pricing here. If the market price moves, our price moves, and we adjust pretty regularly. We've actually had multiple price increases already this season, and we expect more to come even in the H2 of the year. In Latin America, as you know, it's a little bit of a different situation because we have to price in local currency, but we try and tie this as tightly as possible to U.S. dollar currency movements. Also here, we usually have multiple price increases throughout the season. As an example, now starting into the LatAm season, you could expect to be seeing local price increases of high single-digit, is what we'd be expecting on the CP portfolio. Overall, again, we should be compensating for any COGS increases as we go through the year. There might be a bit of a time lag given the nature of crop protection. So far we've been able to pass on or I think you'll see more of the pricing effect kicking in in the H2 of the year, simply again, due to that time lag. Okay. Finally, are you expecting any more headwinds in the H2 of the year from lost registrations? No. The big one this year was thiacloprid, which we'd flagged last year as well because we knew that was coming. Beyond that, there's nothing that I would flag for the H2 of this year that's really relevant. The most of the sales of thiacloprid are in the H1 of the year, not the H2. Thank you very much. The next question is from the line of Ms. Walton. Please state your name, company name, followed by your question. Thank you. Jo Walton from Credit Suisse. To start on the crop side, can I just clarify, you've gone from an underlying expectation of 2% sales growth to now 7% sales growth. Is the vast majority of that increase to do with price? Is there anything to do with increased volume or background improvement? If we think about that big price improvement, is that just because everyone is able to get a price uplift, or is there somewhere where you are getting it from a competitive point of view? On the pharma side, again, looking at the uplift in sales guidance from 4%- 6% in local currency, what proportion of that is COVID-related disruption coming back perhaps faster than you'd anticipated with very strong performance in the hospital imaging side of things? I don't know how sustainable, whether that's just a massive catch-up that won't keep going in the future. If you could also give us an update on the rollout of NUBEQA beyond Germany, how that's doing. You've said in the past that you would expect NUBEQA to reach your top 15 drugs by the end of this year. Is that the same for neratinib? Thank you. Okay. Thanks a lot, Jo. Let me start with the first question. As you know, the H1 of our year is where we do the bulk of sales and actually pull in the bulk of EBITDA in the Crop Science business. The H1 of the year was roughly 6% volume increase and 2% price increase. This changes as we go through the H2 of the year, where you'll see significantly more price increase versus volume. How that nets out at the end of the year, we'll see. What you can see is that over time, the pricing impact is kicking in more and more at the back end. Those price increases are clearly coming from the fact that we have a buoyant market situation with high corn and soybean commodity prices. We always have to price competitively, but reality is, in almost every market with our portfolio, we tend to be the price leader. We always try and aim for a premium price. If we lift up the prices, it often happens that others will follow as well. This is something where I think overall, we've had a good experience in the market, that price increases do not necessarily lead to market share loss on our side. Market share is really dependent on in-market performance of the products. Here, across the board on corn, We'll only know at the end of the season, but it looks like we've gained a bit of market share. Soybeans, we're doing better than we had originally expected, given the highly competitive situation in North America. Clearly in crop protection, we believe we're gaining market share. Despite the fact that we have high-end pricing and are increasing prices, I believe we still have room for share increases as well. Yeah. Hi, Jo. Your question on performance versus catch-up versus real performance. There's obviously a mix of both, and there's, I would say also in the H2, we're going to see a little bit of that catch-up still. When I look at the underlying performance, some of the things that I had been talking about also to all of you over the last year, that we were well in the pandemic, lacking elective treatments, we were increasing in market share, especially on EYLEA. Also on some of our women's healthcare business in the U.S. This is now coming to full fruition. As demand is strong again, the market share is coming through, and we're seeing this translated to growth. Some of this is performance. Let me also remind you that when we guided for the year, when we guided for the 4%, all the catch-up was already included in the guidance. That was included before. What also plays a significant difference is that we saw VBP, for Xarelto China come in maybe a little later than we would have expected, and that gives us also a little bit of a lift for the remainder of the year. As to the rollout of NUBEQA, we had said last time when we spoke that this will make it to the top 15 by the end of the year. We stand by that. Just to repeat, top 15 is somewhere in the range of EUR 200 million-EUR 250 million probably. Just to give you an indication, we're seeing really strong demand for NUBEQA in the Q2 despite the pandemic. Across the board, we saw really strong reimbursement now in Germany, better than expected. This is going well. To finerenone, I wish I could tell you, but this is a little early to place this in the top 15 this year, because we're only coming out of the gate basically in September. I'm sure you will ask me a lot of questions on finerenone because you will have good visibility on demand with prescription data in the U.S. Thank you. The next question comes from Mr. Quigley. Please state your name, company name, followed by your question. Hi there. Thanks for taking my question. It's James Quigley from Morgan Stanley. I've got two, please, or two and a half. On the Vividion acquisition, can you give us a bit more details on this? How it fits into the biodiscovery platform, what will be the impact on R&D costs on an annualized basis, and the margin drag from that? What is it about the platform that gives you confidence that it will significantly improve your drug discovery capabilities? For eliapixant in the chronic cough indication, where do you think this will be differentiated versus Merck & Co.'s gefapixant? How are you planning on designing the phase III trials? Are you sort of considering any patient selection within those trials? In terms of the read across from the phase II that you reported yesterday or gave the top line yesterday to the other indications, is there any, or is it just more of a phase II taste to read across rather than anything else? Third one on Kerendia. What is the contracting situation like here and the reinvestment profile, or what are you expecting from a reinvestment profile in the U.S. or sort of the trend of reinvestment? I think it was $19 a day price, which is obviously significantly more than the SGLT2s. How will that impact sales and uptake? Thank you. Okay. Thanks, James. Maybe first about Vividion. I think with this acquisition, we're really consistently executing against our innovation vision and creating true value through breakthrough. To us, Vividion is really unique and at the same time, a world-leading platform to address biological targets that no one else has been able to address. It's 90% of all known disease-causing and modifying proteins that we can now address that before couldn't be addressed. I could also say it differently. We're getting from the druggable now into the undruggable phase, which is, I think, an incredible leap. For us, it's the perfect combination. Our expertise in chemistry, but also drug development, combined with Vividion, should be able to really capture the full potential of this groundbreaking technology. You've seen their licensing deals that were, I think, very noteworthy given the milestones that were attached to that they've done before, how well this technology is seen also by some of our competitors. I think it's a great leap forward. In terms of cost, we intend to absorb that cost within our overall R&D expense. Don't count for that as an additional burden to our profile. Coming to eliapixant, I can't tell you how pleased I am with the results of this. At the same time, I can't tell you what it is exactly because we're waiting for the publication of the full data at an upcoming meeting. I can guarantee you'll be as pleased as I am now when you see it. In terms of differentiation to Merck, you've seen good efficacy with Merck. You've seen a somewhat mixed side effect profile that they have. Stay tuned, but I think it's going to be a good surprise. On the entry for finerenone in terms of pricing and reimbursement, of course, we're right now working with the different commercial payers as a priority in the U.S. to gain lives here. I think we have a very favorable price profile because I think you're looking at this potentially the wrong way. You shouldn't necessarily compare us to SGLT2 as a price anchor because this is not a diabetes drug. We feel strong that we're actually priced right and we will have, hopefully then also, but too early to say reasonable commercial conditions that allow for not just a good uptake in prescriptions, but also to capture the value that we think lies in our medicine. Great. Thanks very much. The next question comes to the line of Mr. Jones. Please state your name, company name, followed by your question. Good afternoon, everybody. Tony Jones from Redburn in London. I've got three quick ones. On slide 21, the pipeline, it shows that you've got SmartStax PRO moving into launch mode for next year. Could you tell us a little bit about what the price premium might be and maybe early-stage estimates on acreage? On litigation, when are you expecting the decision on the Supreme Court accepting the pre-emption case or maybe a little bit of a range? That would be really helpful. Circling back to seeds, you say that you're hedged. That seems quite Bayer-specific. Could you explain what the mechanics are there, please, and how that works? Thank you. Thanks, Tony. Let me start. SmartStax PRO we're launching next year, we'd actually be guiding for that at the beginning of the year, how we see that from a one point of view. What you can, of course, expect is that it'll be a pricing premium over SmartStax. What we're seeing, and what we're hearing a lot as well this year in the U.S. in comparison to the last few years is that there is more corn rootworm pressure. We hope that this is coming into a positive market environment where we can get significant penetration. I would suggest that we update you then at the beginning when we give our guidance for 2022 about the outlook specifically for that product litigation. Maybe you could do also the seeds hedging. Yeah. I don't know, Wolfgang, if you want to take how the mechanics of how we do our hedging. Our basic philosophy is from a production point of view, this is not something that we want to be earning money off. We just want to make sure that we don't make any losses. We basically in essence hedge our soybean and our corn production to ensure that there's not overly any kind of volatility in there. Nothing much to add. Exactly the reason why we do that. Okay. We use standard derivatives. Yep to do that. Tony, on your last question, we are going to file our writ for the petition to the Supreme Court on August 23rd. Just about a fortnight from now. The Supreme Court could then virtually any day accept it. Normally, it takes quite a number of months. We would think that around the turn of the year, end of 2021, early 2022, by then for sure, the Supreme Court will have taken the decision on whether to take the case or not, but it could also be earlier. Thank you. That's really helpful. The next question comes from the line of Mr. Faitz. Please state your name, company name, followed by your question. Yes, thank you for taking my two questions, please. First of all, a question for Liam, again, coming back to the production cost. Sorry for that. I appreciate your seed production costs are hedged for this year on the seed side. How would that look next year, and how much more expensive would that hedge be given the rise in crop commodity prices? Then, the second question is on the current heat drought wave in the Western U.S. Is that a concern for you? Are demand patterns affected in any way, let's say sprays in the Northwestern U.S. or veggie seeds in California? Thank you. Yeah. Thanks, Christian. Next year for the production costs, if commodity prices and as you know, this is all a factor of where commodity prices are. We could expect some higher hedging costs, but again, this will completely depend on where the overall commodity price is. Given the peaks that they're at right now, it's kind of hard to imagine that this would go significantly higher. I think we should be okay on that front. Just acoustically, I didn't really get the second, you meant the drought in California, whether that's impacting the veggies business? Yeah, the veggies, but also spraying in the Northwestern U.S. The Northwestern U.S. is quite heavily affected. Is there any stockpiling effect in sprays which hadn't been applied? Things like that. Yeah. For affected farmers, this, of course, is a disastrous situation. We've also had pretty freaky weather incidents in other parts of the world as well. On our business right now, we're not seeing any material impact. Our vegetables and particularly our fruit and vegetable business is pretty specialized. There's also a lot of indoor business for us. We're not seeing anything that would be overly concerned of right now. It does, of course, for affected farmers, is a big issue. On stocks in the channel, in North America in the specific example, we're not noticing any elevated levels of stocks because of, for example, mis-sprays. I think the only issue really is rather much further north than Canada and the ongoing drought there that probably from a fungicide point of view, is leading to some increased inventories in the channel. By and large, it's not something that I, right now, I would be somehow materially worried about. Okay, great. Thanks, Liam. Very helpful. Emma, I think we have time for one or two more questions. I am time conscious. Yep. The last question is from the line of Mr. Parekh with Goldman. Please state your name, company name, followed by your question. Please go ahead. Hi. Good afternoon. Thank you for taking my questions. I have three, please. The first one for Liam. Liam, you very eloquently explained the margin on the crop side and the variances between quarters, my question is slightly different. You've gone from 2% top-line growth on crop at the start of this year to 7% top-line growth. There are very few businesses where your growth more than doubles and margin expectations remain flat. I understand there are some things about this particular year that may be a question, how do you not drive greater margins when crop is growing 7%? Longer term, does this mean that 2024, 2025 is now peak margins for this business and we need to start thinking about volatility more on the revenue line? That's question number one. Question number two is, if I read the disclosures correctly, your total employee compensation for the half is up 21% year-over-year. Your stock price is down 30% compared to the peer group over the last 12 months. Werner, just keen on your thoughts of how you think about the various stakeholders in your business, and whether margin should flow through to your shareholders or to your employees. Lastly, the call last week, Werner, you spoke about trying to rebuild trust in the intrinsic fundamental value of Bayer. At least six out of the last 12 quarters, there have been some form of a disappointment relative to street expectations. What are we getting wrong on a quarterly basis? What can Bayer do to help us avoid those mistakes going forward? Yeah. Thanks a lot. Let me start with the first one. I'll try not to repeat some of the explanations I gave earlier. On your I think high-level question is like 24% or 2024/2025, is that peak margin? Clearly, I do not think that is the case. We had said going into this year, we viewed it as a transitional year. We gave out a certain guidance on the bottom line. We knew there would be some transitional impacts, some transitory impacts that particularly hit us in the H1 of the year, that ease up in the H2 of the year that by and large are not present in next year. If you think of the situation then going into next year, where we should be benefiting from some of the price increases that are coming through in the H2 of this year and the efficiency measures, if we don't have the transitory increase in costs to the degree we had this year, you should be expecting margin accretion. That's what I would be expecting and that's why we're completely sticking to our midterm guidance of 27%-29%. Yeah, let me take the other two questions, Liam. First of all, on your first question, our employee compensation, as you rightfully point out, is up 21%. That's in a way, a little bit a technicality and an artifact in the quarter because we do have quite a bit of volatility based on our Q2 last year with a significant baseline effect where rather than putting up provisions for a normal year bonus program, in light of the massive COVID impact, it was already visible that both with COVID and FX, we would be by and large out of the money, at least in two of our businesses. That led to actually a reverse of accruals into earnings. Versus this year, where we see based on where we started the year, actually, quite frankly, improving momentum. We see that across the board, top line, we see it bottom line. We will for sure see some further momentum, positive momentum going into 2022. Based on that, you see that year-over-year swing factor over-expressed, which doesn't have any bearing on a full-year employee or let's say a payroll structure that you would see by the end of the year. Secondly, in terms of rebuilding trust, this is not about the receiver. This is about the sender. Obviously, we don't get it right. Last week, we wanted to make sure that you get full transparency on where we are going to take the litigation, what the option space is that we provide for the let's say, less favorable outcome in our balance sheet so that you have full transparency and we try to do the same today with our quarter and frame the quarter with some of the effects that have been weighing on the quarter while at the same time providing you, I think with a little more relevance, a full perspective and full confirmation of where the year is going. Obviously we have to do better. I fully take that point. Mr. Maier, there are no further questions at this time. Okay, great. Thank you very much, Emma. Thanks to all of you for your time and your attention today. It's greatly appreciated. This closes our call. Talk to you soon. Thank you. Ladies and gentlemen, this concludes the Q2 2021 investor and analyst conference call of Bayer AG. Thank you for participating. You may now disconnect.