[Non-English content] Good afternoon, ladies and gentlemen, welcome to Orion's earnings webcast and conference call for the financial period of January-September 2021. My name is Tuukka Hirvonen. I'm the Head of IR here at Orion. In a few moments, our CEO, Timo Lappalainen, will present the results, after which you will have the opportunity to present questions either to him or to our CFO, Jari Karlson. We will first take questions from the teleconference lines. After that, we will turn to the webcast, through which you can send your questions using the chat box on the bottom of the screen. Kindly state your name and the organization which you represent before asking your question. Just before I let Timo to step in, I would like to draw your attention to this disclaimer. This presentation contains forward-looking statements which involve risks and uncertainty factors. The actual results may differ even substantially from those stated here today. However, Orion applies no obligation to revise or correct the information in today's presentations. With the se words, I'd like to invite Timo on the podium. Timo, please. Thank you, Tuukka, for your kind introduction. Now, for the first nine months, we see that the operations are gradually shifting toward more normal, whatever the new normal may be. However, we are still seeing the effects of the pandemic. When we look at the net sales and operating profit, what certainly strikes through our P&L are the milestones which we have booked only EUR 2 million as compared to EUR 37 million in the previous same period. Of course, the Nubeqa, which is still in the launch phase, Orion's discovery in prostate cancer that we partnered with Bayer, continued to show strong growth. Operating costs are still at a lower level than usual, and we also flagged this in our written report. We are seeing the signs that the demand for many products is recovering. Also, some business development activities have taken place. We've partnered with Marinus of the U.S. and have subsequently received the sales and marketing rights for ganaxolone in Europe. Today, the board has also narrowed the guidance for the 2021 outlook. Good news from the R&D side. EMA has granted the marketing authorization for two new animal health products, Bonqat and Tessie, the first one for feline and the other one for canine populations. We've also initiated a new phase I study with a molecule that's based on Orion's long-term Alpha-2 research. We've also partnered with Alligator Bioscience to study certain technologies in immuno-oncology. When we look at COVID in totality, as said, there has been a gradual recovery in the markets. We are seeing hospitals opening, we are seeing patients entering physicians to renew their scripts, and so on. Through a very hard work of Orion professionals, we've been able to avoid disruptions in our production and have secured the availability of products, raw materials, intermediates, and so forth. However, one should not discount that this abnormal situation that we are living is, that's not over yet. Subsequently, we have then increased our inventory levels of all materials, supplies, and products. The key numbers for the first nine months, net sales, those were roughly 7% shy of last year. Operating profit certainly was lower, and of course, the bulk of that comes from the milestone payments. Operating profit margin is still meeting our 25% target. Cash flow was lower than in the previous period, and of course, our investments in both tangible and intangible investments has been higher than in the previous period. When we look at the waterfall, how the sales have evolved from the 2020 numbers, Dexdor certainly has seen much more generic competition. Of course, that's been more or less balanced with the Nubeqa over the period. Simdax has seen the first signs of generic competition, but that has not taken place as rapidly as we initially thought in the beginning of the year. Easyhaler suffered for the first half of the year, still from the COVID, but now we see more optimism in the space of respiratory products. The royalties and milestones, those are, of course, a big headline number that makes their number also known in the net sales. When we look at the operating profit, certainly, of course, product sales and the margin mix has paid its toll. Here, of course, the royalties and milestones, which flow almost directly to the bottom line, have made the number smaller for this period. The counterweight of that has been the fixed cost, where there certainly has been a saving, if one says that, or in some cases, a postponement of various events or processes. That's how we landed at EUR 203. The sales distribution is not really a material change here. The biggest single country market continues to be Finland, followed by the large markets, of course, in Europe, Scandinavia, important ones, North America being a large one for us again. Here, when one looks at the different geographies, how the territories have performed, we note that in most markets, we've actually seen a little bit on the negative side. However, when we look at a little more detail, we will see that there are also bright spots. In terms of the specialty products, that was pretty much at par compared to the previous period, which was a good catch- up after we had a very strong comparison 2020. Proprietary products, certainly, the loss of patents has eaten into that in animal health, as we lost a major distributorship arrangement has taken its toll when we talk about the net sales. However, as we've indicated several times, the profitability of this lost revenue was certainly lower than the group average. The bottom line effect of that is much lower. Fermion is pretty much at par compared to the previous period. The top league of the products. Easyhaler continues to plow ahead. As I said, there's a little bit more optimism now in the year when the year has evolved, and we are seeing that the patients are returning back. We are also seeing the first signs of the northern hemisphere influenza upper respiratory diseases, and that typically has, in the past, always boosted also the demand for Easyhaler products. Stalevo, our Parkinson products continue to perform, and there is a little bit of fluctuation here also that one can account for the seasonality. Simdax's lower sales, Dexdor as well, and the animal health sedatives are strong growing. Of course, Nubeqa, as one would expect, continues strong performance over the period. If we first move to proprietary products, and there certainly Nubeqa's growing, that's of course the highlight of the season that it continues. However, I would like to draw attention also that the Easyhaler is making a comeback when we look at the little bit more on the Moody Blues story in the beginning of the year and last year. That's coming as well. Nubeqa, certainly, we've discussed several times that the way we account for Nubeqa sales in Orion is a little bit complicated. In the quarter one, we would ship the product, and then as a totality, Orion's return is in the form of revenue being shipped in the previous quarter, and then those product sales are deducted then from the royalties in the present quarter. In that case, that means that when we look at the Q3, Q2 this year, the obvious conclusion here is that we shipped a lot of material to Bayer in quarter two, and then that was deducted from the royalty income in quarter three. That's why you would see not only the transition from quarter- to- quarter, depending on what's shipped, but then that is always deducted from the following quarter. That's a little bit of the math behind there. Certainly, strong performance overall, and one has to take a little bit longer view on these quarters here. Easyhaler, as said, we see the first signs of recovery there since the COVID months, and that seems to be performing very well. I think there are good opportunities that will do okay still this year. Parkinson franchise, here we see that Orion's own sales, those continue to perform quite in a solid fashion. Of course, here there is always the timing of our deliveries to partners and the timing of those at the end of the quarter, beginning of the quarter, end of the year, beginning of the year, which introduces certainly some volatility to that. When we look at the overall in-market sales, there's hardly any change in our view there. Dexdor, certainly now as we are seeing less patients in overall admitted to ICUs, there are multiple competitors in the space, and we are also seeing fierce price competition, so that all eats into the Dexdor sales in Europe. Here we see the results of that. That has been the trend that we've indicated in our quarterly earnings calls. In Simdax, when we entered this year, we had the first view that we'd see the first generics enter the market at the end of the first quarter or so. Now, probably we are going to see that in this ongoing quarter, so quarter four, in any material way. We've seen in some specific countries, in some tenders, we've seen generic competition, but that still remains to be seen, and obviously, we don't have a visual to that, how the competition would play out. Moving on to specialty products, and this is the category that includes our generics, our OTC products. Especially in Eastern Europe and Russia, the going was strong, and in some other markets, a little bit less so. One of the reasons is, especially in Scandinavia, there was this stockpiling effect that took place in 2020, and obviously that, we haven't seen any more this year. The self-care products, when we look at the product split, the generic prescription products were a little bit lacking there behind last year, but the self-care products seem like that is coming back. As said, then the influenza season, should we see that in Northern Hemisphere, which we did not see last year, that probably would give a somewhat boost to that. Now, in the local market here in Finland, the overall market for reference price products, these are the products that are basically substitutable. The overall market declined by 5%, which kind of also is the same, a little bit less than the price cuts that we saw or the pricing decline based on the competition. It was a little bit more. Orion was able to increase its sales by 3%, which means that not only did we beat the price declines, but our volume share increased quite a lot in the market. When we look at the overall market here, our market share of reference price products, 24%, is almost the same as in self-care and in the total market, 11%. That we can be quite happy with. I'll move on to the R&D side. In key clinical development pipeline, so of course, ARASENS is something that has been indicated that the headline results should be made available later this year. The ARANOTE, that is recruiting, we know that. ODM-208, ODM-209, we have indicated in our release today that we would be making the selection of the compound, which one to move forward with, and also that we are seeking to partner that compound outside Europe. We have initiated a new phase I study based on a compound from our Alpha-2 research, and this is in the neurological disorder space. On Easyhalers, we continue to plow ahead with our developments in tiotropium. We are also now evaluating for indacaterol glycopyrronium product. As we made available our key business targets for the ongoing year, here are the traffic lights for that. Of course, when we look at Nubeqa, the co-promo here in Europe has proceeded very well. As said, we expect that most of the countries, maybe apart from two in Europe, would have launched Nubeqa when we close the year. Of course, ARASENS, we don't know how that's going to turn out. The ARANOTE, that study has been initiated, and the patient enrollment is proceeding. Sales growth seems like the growth target is a tough one this year, but we'll see how the year will end. ODM-208, we are taking the program forward as we have planned and then making the selection sometime next year. Do we take the ODM-208 or ODM-209 forward? Strong market position growth here in Finland and then also in Scandinavia, especially in prescription products. In licensing new products, ganaxolone, our partnership with Marinus is the first one in that. Of course, in R&D side, also with Alligator is one of those sides. In larger acquisitions, there we don't have anything to disclose at this time. Of course, the sustainability, that's an important element of Orion's genetic makeup, and it starts all with patient safety. That's the top priority. Also, there, of course, making sure that the supplies are available throughout also difficult times, even what we saw in the wake of a crisis. We are working actively for the environment, and we have a tough target for being carbon neutral in our own operations by 2030. Of course, taking care of the professionals that work within the company and with our partners, so that we can continue our operations without any interruptions. In this line of business, the ethics are an important element, and we maintain very high and strict ethical standards. The specified outlook for this year, no change in our net sales. We estimate that this year's net sales would close to be slightly lower than in 2020. In the operating profit, those would be lower than in 2020. The key assumptions behind our outlook, of course, in the net sales, we see Nubeqa, strong growth plowing ahead. There are also some other products, especially in the specialty products range, that continue to go ahead. What we are seeing is that, as discussed, the milestones, those will be at track this year. Dexdor and Simdax, we are also seeing the effect of generic competition there. Of course, in animal health, the loss of one important partnership. In operating profit, of course, Nubeqa is an important element there. When we look at the cost side, we are missing this year, so we have fully amortized the investment in the Parkinson franchise purchase, and those roughly EUR 12 million are missing from our P&L this year. Of course, as said milestones, Dexdor, and Simdax continue to then flow through our P&L as well. That's pretty much for the first nine months. The full year results we will discuss in our earnings call in the early February, and we expect to hold the AGM in March, and the planned date is the 23rd of March. With this opening words, I now invite our CFO, Jari Karlson, to join me here to the podium. As Tuukka Hirvonen mentioned, we are happy to take any questions, comments that you may have, and we will take first the comments from the telephone lines, and then move on to chat. If you wish to ask a question, please dial zero one on your telephone keypad now to enter the queue. Once your name is been announced you can ask your question. If you find your question isn't answered before, it's your turn to speak. You can dial zero two to cancel. So once again, that's zero one to ask a question, or zero two if you need to cancel. Our first question will come from the line of Jo Walton at Credit Suisse. Please go ahead, your line is open. Thank you. I've got three quick ones, please. Firstly, on Nubeqa, I know that you've told us how complicated the accounting is. Can we assume that the end- user sales are rising? Clearly, your overall revenues didn't go up in 3Q. You also talked about, I think you said, that there would be more countries where there would be a rollout of Nubeqa in Europe. I wonder if you could just tell us a little bit about your level of involvement, how much effort you're putting behind that, how we should think about that when we're thinking about your cost structure going forward. My second question would just be to ask about the costs. Again, as we're beginning to think about 2022, how much of the lower costs that you can keep in 2021 can you also keep into 2022? Are there things that you can now do differently, things that you were going to spend on that you haven't this year that you don't think you will spend on next year? Just help us think about how the costs will grow next year. Just a final one on M&A. Clearly, you've identified that you're behind target in terms of looking for bigger deals. I appreciate you haven't given you much time to do that. I wonder if you could tell us, are you seeing plenty of ideas? You're just working through them. Are you thinking that what you're seeing is just too expensive? Just give us a sense of how close we might be to being able to do a deal. Are you seeing things that might be attractive? Would it be reasonable to assume that you might be able to do something next year? Thank you. Thank you. Good questions. I'll start with Nubeqa, and then maybe Jari will take the cost side. On Nubeqa, Orion's involvement is in Europe. That's what we are putting in the sales force. Bayer they are responsible for marketing activities, developing market access, so meaning pricing reimbursement, and also the logistics or organizing the logistics. I think when we look at our cost side from how much sales force capacity we have in Nubeqa, I think we have pretty much in most countries, there are maybe two countries that would not be upstream yet, but those would not be material. I think in overall, in the large scheme of things, we have fully deployed now the resources that we expect to deploy to support Nubeqa sales in Europe and do our job there. For the in-market sales here, I'm sorry, but I need to advise you to discuss this specific question with our partner, Bayer. Cost sides, do you? Yes. We of course have basically two major elements in our cost structure, the sales and marketing, and R&D. When it comes to sales and marketing costs, of course, there the big element is the personnel cost, and those of course will continue pretty much as they have been this year. The main reason for the reduction in cost, of course, compared to last year, the biggest element has been that we don't have any more the entacapone European depreciation or amortization in our cost structure. When you take out that roughly EUR 1 million a month, the cost structure is not that different from what we saw last year, slightly lower. Of course, when it comes to next year, many of the conferences will probably come back to live events again, and also some promotional activity relate similar activities will come back. One should assume that we will have some additional costs next year. Of course, how much those will be, it's still under planning because we of course need to also learn from the past two years that what kind of activities make sense, what don't make sense, what makes sense to continue virtually and so forth. I think it's fair to assume that we will see some increase, but how much, that is too early to say. When it comes to R&D costs, those, of course, are completely dependent on two things: the ongoing R&D programs and how they proceed, and then, on the other hand, how do we see the partnering element. For example, in the ODM-208 program, which is now proceeding gradually to the more expensive stages in the development. Also, there, we still have, of course, plenty of open questions. One would assume that if the programs proceed, we will see some increase in our R&D spending next year. There are still a lot of open questions which need to be answered, and by the time when we are then coming out with our outlook for next year, hopefully, in both of these areas, we have a clearer view of what is going to happen in 2022. With regards to the M&A pipeline or capital allocation in portfolio acquisitions, there are plenty of interesting opportunities in that space. Our focus is mainly in, from the geographical perspective, it's mainly in Europe. From the therapy area perspective, we've clearly identified that whilst oncology would be interesting, the valuation in that space is out of reach, so it's more of a focus in the neuroscience space, and also generics and also animal health space. There certainly are opportunities there, but like was pointed out, the valuations in this cycle at this time are very rich, and it is not easy to make the math work. That's a challenge, especially if you are, as Orion would be, a industrial buyer who does not buy and sell, but when we were to buy something, that would become part of Orion until further notice, and we don't have any specific exit target dates and so forth. That, of course, makes it a little bit more challenging at this time. There are interesting ideas, and we think that for some cases, Orion would make a very good partner or a new home for an asset. We certainly have not given up on that. We continue to work on those ideas as well. Thank you. Thank you. Our next question comes from the line of Sami Sarkamies of Nordea. Hi. I have three questions. Firstly, I would ask you to shed more light into the new phase I program. What kind of target indication are we talking about, and how would you assess the potential relative to earlier CNS programs? Secondly, on ODM-208, can you please open up the various options that you will be faced with early next year when you will be making decisions, and what would be the preferred option for you then? Thirdly, on Parkinson's, I think you have previously indicated stable sales for the next few years. Do you still think that can be the case this year and next year? Thanks. On the phase I program, we were deliberately a little bit vague on that, and we hope that when we release the full year results, we could be more specific on the mode of action as well as the potential target indication. Of course, one has to respect that, as we are currently only in phase I, so that's healthy volunteers. We are getting the first in men data on that, and that would be on tolerability. Purposely, we would invite or ask your patience for a couple of months here, and then we'll hope that we are able to discuss a little bit more on that. I think this is in the interest of the company and in the interest of shareholders that we are a little bit vague at this time. For the ODM-208-ODM-209 partnership, here the partnership arrangement that we are seeking for would be ex-Europe. Europe, we would expect to hold for ourselves. We would also expect to hold certain Pacific Southeast Asian markets for ourselves where we are currently present. The key markets that we're talking about, of course, is the U.S., that would be China, that would be Japan, and some other interesting larger markets. Of course, the U.S. would be the driver here. We'd be seeking for a partnership who could contribute with Orion to the late-stage development of the compound, who would also be our commercial partner in the U.S. We are in the early steps yet in that partnership discussion. Once we have a little bit more color on the prospects on the potential partners, we'll certainly come back to that. On PD, on the Stalevo and Comtess/Comtan, we still stick to that we think it's a stable sales. The problem there is, and this is a genuine problem, is how the shipments to our partners will take place this quarter or next quarter, and that may introduce some volatility to that. When you looked at our own sales, that was pretty steady going, and that's how we base our assumption, because when we look at the overall market, there is certainly a need for this, and the demand from the in-market is actually very stable. Okay, thanks. Maybe a follow-up question on ODM-208. I guess you've been testing this with both breast cancer and prostate cancer. Are you planning to proceed with both indications as an ideal sort of situation? Maybe secondly, are you ready to sort of go along with a partner that wants to have global rights in case the deal is sort of attractive enough for you? First part of the question, the likely indication, and the next studies are to be focused on prostate cancer, so that's where we're seeing the most of the opportunities for this product there. We've tested that in breast cancer. It's a much more complicated arena, and actually, the patients are not fully served, but there are good products there also. I think the greater added value opportunity lies in prostate cancer. In a global partner, our aim is actually that we would retain the European rights. That's our goal there. Being a public company, you can never say never, depending, of course, on what is put on the table, but that's our starting point, that we would retain the European rights and then some other rights as well outside Europe, and the key focus, of course, would be the discussions around the U.S. Okay, thank you. I don't have any further questions. Thank you once again. If there are any further questions on the phones, please dial zero one on your telephone keypads now. There seem to be no further questions from the phones at this time. Okay. Thank you, operator. We have a few questions from the webcast platform. Let's start with the one from James Vane-Tempest from Jefferies. James is asking that the biosimilars growth of 25%, have you won any new tenders or had any new launches, and how should we think about this franchise and the pricing environment? No, we have not won any major tenders. This is an effect of existing portfolios and the performance of that business in several countries. We think as we move forward, the biosimilar business, as far as they are hospital-based products, the competition will continue to be fierce in that space. We expect severe price cuts as there are multiple entries there. Managing the cost in that business is paramount. Also, depending on the healthcare system, what type of system, even if it is an open care product, if the pharmacy has the right to switch the product, we don't have those yet, but one should not discount that opportunity. I think that's how we see that the biosimilars are there to be seen. We will be part of that game. We are not developing those by ourselves, but we will be in that business and are building that portfolio. It's, I think what the industry once thought that it was a 30% decline in prices; I think that was overly optimistic. Thanks, Timo. We have one question to Jari. You basically already replied to the cost side, but maybe if there's something to add. How sustainable are the cost savings made in this quarter going forward, given S&M and R&D are both sequentially and year-on-year lower than previous periods? Well, I guess the word cost savings is probably not exactly the right one. The reason the costs are down is mainly due to the fact that certain activities in normal circumstances would have been doing, we have not been able to do those, and that is especially in sales and marketing. On the R&D side, it's more related to the timing of some of the clinical studies. Of course, there's COVID, and some other things have caused some delays and slowdown in the development of some of the programs. I wouldn't really call them cost savings. The costs are down, and like already discussed earlier, what will happen next year is there are still many open questions in both areas. In the R&D, of course, how the programs are proceeding and also what type of partnering structures we might end up doing, especially in the ODM-208, 209 program. On the cost side, what type of activities we really see valuable next year, taking into account the learning we have seen over the last couple of years? Thanks, Jari. We had one question regarding the new phase I study, but actually, Timo, you already answered that. Mikko, your question was already answered. We will then disclose further details on the program, probably in our Q4 results in early February. We have one follow-up question regarding Simdax. Simdax didn't seem impacted by generics. Why no material decline in sales? Well, Simdax, the way hospital products business in many countries works, that once there is public knowledge and information that there will be generics in the near-term future. Typically, the institutional buyers, hospitals or chains of hospitals, however they organize their purchasing, they start putting pressure on the originator in order to have the business also in the future, and they sort of preempt the expected price cuts already before you would see the actual entry of generics. That's what has happened with regard to Simdax. There has been one instance where we've seen a true generic enter the market, but as I said, that has not had the material impact. The impact has come from the price cuts. Thanks, Timo. The final one, this is regarding the specified outlook, especially regarding the operating profit. How should we think about the term lower? What that actually mean in your guidance? Well, we haven't given out the specific range, but if you look at historically when we used similar terms, then the outcome has been 10%-12%, but these are not the ranges, but these have been within the range. I guess that would be the right term to say. Great. Thanks, Timo. Now we have exhausted all the questions we have received so far through the webcast. I would still like to turn to the operator. Do we have any follow-ups on the teleconference lines? None so far. Once again, if there are any further questions, please dial zero one on your telephone keypads now. No further questions from the phones. Okay. Timo, say closing words, please. Thank you very much. Thanks for joining our earnings call. I'm looking forward to seeing or hearing from you in early February. Everybody, stay safe, get vaccinated.