Good afternoon ladies and gentlemen and welcome to Orion's Earnings Conference Call and webcast for the financial period of January March 2025. My name is Tuukka Hirvonen, I'm the Head of IR here at Orion. In a few moments, as you know, we will start this event with CEO Liisa Hurme's presentation, after which you will have the possibility to ask questions from her and also from our CFO Mr. René Lindell. We will be first taking questions through the conference call lines and then you also have the possibility to send in your questions through the webcast question form. We kindly ask you to present the company organization you are representing before asking your question. Just before letting Liisa step in, just a reminder about the disclaimer regarding forward looking statements and with this it's my pleasure to hand over to Liisa. Thank you Tuukka and good afternoon on my behalf as well and welcome to Orion Quarter One 2025 webcast. I'll start with some highlights from our first quarter. I'm happy to tell that all our four businesses great growth and the fifth one, Fermion, didn't grow, but I will explain a bit about that later on. Also our geographic expansion and R&D capabilities program is progressing and we have opened an R&D site in Cambridge in purpose of strengthening our pharmaceutical development for biologics. Also there is a new key project in our clinical pipeline. This phase III is on Levosimendan for a pulmonary hypertension in certain specific patient segment and this phase III is carried out by Tenax Therapeutics in United States. On financials, the quarter one was excellent. Net sales grew 15% and our operating profit grew 39% and also operating profit margin improved from last year's quarter. Quarter one cash flow decreased to some extent mainly due to timing of royalty payments and some milestone payments between borders. Our net sales bridge looks a bit different than previously. If you remember earlier we had net sales based on some of our biggest products and now we have divided our net sales picture by based on our divisions. Now it's easier to follow up how each division is doing and which divisions are creating growth and more or less growth since all four human divisions and animal health is creating all three human divisions and animal health is creating growth. Innovative medicines EUR 40.4 million in quarter one, branded products EUR 6.8 million and generics EUR 1 million and animal health EUR 3.3 million of growth. Fermion as I already said was not developing positively, but let's remember that this is only external sales and then there are some internal translations between and other operations in Orion which are very, very marginal here 400 million. But all this ended up EUR 354.6 million of net sales in quarter one. Operating profit bridge is pretty much the same as earlier, but we've made it a bit clearer with our texts. The first column here, EUR 13.7 million points to the change in volumes. This is the euros that the volume increase has created this much growth. The second one includes the change that comes from changes of prices, cost and product mix. Slight decrease there by EUR 5.6 million. The third one is the effect of exchange rate on our gross margin. Fourth one, royalties, clearly the biggest contributor here. The fifth milestones compared to last year's first quarter, a bit of minus there. Other operating income and expenses. Number seven here on column seven you can see the fixed costs, which is mainly sales and marketing costs in quarter one. All this ended up to close to EUR 78 million in operating profit during first quarter. I try to innovate the medicines. 70.4% growth here, which almost created almost EUR 100 million sales in first quarter. We did not yet break that EUR 100 million per quarter. Here on the right-hand side you can see clearly this phenomenon of back end loaded financial year in innovative medicines. You can see how the year ended in quarter four 2024 with EUR 152 million actually. Now we started with EUR 92 million on the first quarter. You can clearly see that there is a huge growth compared to quarter one. No worries if there is a change downwards from the last quarter of the previous year. We've explained this earlier that the royalty rate really gets higher and higher during the year as certain sales in EUR are exceeded. You can also see here that the tablets that we deliver to Bayer reached an all-time high number, EUR 38 million. Branded products, almost 10% of growth. Here you can also see a different type of a split. Here we talk about CNS, not specific products. We can see that respiratory business is clearly the biggest one here. CNS business, back on a growth track, represents 30% of the branded products. Easy haler, the whole portfolio grew 8%. The combination of Budesonide and Formoterol continued strong growth with almost 15%. After a long time, Entacapone, you will see that on the top 10 list. CNS sales grew 5.7%, partly and mainly because of Entacapone sales in Japan, but also because of some minor new products that are in that portfolio. Generics and consumer health almost 1% of growth. A wonderful achievement in that portfolio. Here the split geographically is so that Finland is the biggest single geography for generics and consumer health, Scandinavia the second biggest, and then Eastern Europe. To reach this almost 1% growth, one of the main drivers was actually Scandinavia. This time we were able to supply products that other companies were not able to supply in certain Scandinavian markets, which again shows and proves the excellent service level that we have in our generics business. Animal health strong plus 10% of growth. It was a bit lower sales, although slowly than last year, but still on a very good level in general in animal health business. Then Fermion as I already mentioned, declined. Let's remember this is only external sales and a majority of the capacity is now bound to our internal own products. Top 10 products there are pluses and minuses. Plus 85% for Nubeqa, Easyhaler 8% as I already said, Entacapone products plus 6%. Japan contributing to this growth as should be after repatriation from Novartis. The minus on Dexdomitor Domitor animal health sedatives is mainly due to timing of shipments to our partners. No worries there. There's been a lot of fluctuation between the quarters lately and Divina series, meaning mainly our estradiol gel product. 30% growth. I think that's the after Nubeqa. That's actually our fastest growing product currently. Burana more or less at par with the previous year's first quarter. This is very normal. It's plus or minus 1.2% depending on the Finnish sales. Simdax and Dexdor portfolios are sliding down due to generic competition. Trexan again shipments from one quarter to another one. A new entrant to this list is really Ketipinor products from our generic portfolio. It has climbed up to our top 10 mainly because the Dexdor is going down. I guess we'll see some of the biggest generics actually enter into this list as Dexdor and Simdax are sliding down. We do sell Ketipinor in all the Nordic countries and innovative medicines almost 30% of the revenues. Branded products 22% and generics 37%. Clinical pipeline. We have here two phase III projects ongoing with Nubeqa very familiar to this audience. ARANOTE, which is already in registration phase globally. ARASTEP phase III. two projects ongoing with Opevesostat, OMAHA 1 and OMAHA 2, for a different segment or phase of prostate cancer. One phase II study ongoing with Opevesostat, which is a continuation from the phase II study that we used to design the phase III studies that we have here above. The CYPIDAS study, ODM-212, a new mechanism for cancer treatment for solid tumors phase I. as I last time told, we are expanding phase I this year so that we have enough data to choose the right doses for the phase II study in Tasipimidine study or program. We continue with the phase II this year. We started with the very small phase II A and now we are expanding to the full blown phase II. The new entrant, which we could call TNX-103 as Tenax calls it, is an oral Levosimendan. The molecule is the same as in the Simdax product, but that's an IV product. This is an oral one and is used for pulmonary hypertension with patients with heart failure and ejection fraction of certain magnitude, which in this case means a normal fraction. These patients suffer from pulmonary hypertension. This is rather a long story why this popped up in our clinical pipeline. Maybe you do have questions regarding this, but I may shortly and briefly summarize the story. Already more than 10 years ago we made a deal with a company called Phyxius, at that time an American company. They wanted to develop oral Levosimendan for low cardiac output syndrome. Unfortunately, that study failed. We still continued collaboration with the same people now in the company called Tenax and they managed and succeeded in getting finance for this program with Levosimendan for this indication. This came public March this year. This was the right time to bring it also public here in our pipeline. As this is our molecule and partner agreement like we have partner agreements with other companies like Bayer, Merck and also smaller companies. To a very different subject, sustainability and highlights from 2024. As many companies in Europe we reported or had our first CSR report and that was published in March as part of report by the board of directors. This was a huge job and I thank the team for this. I think all the companies have been working to fulfill these European requirements. Pharmaceutical industry is all about patient safety and quality. In 2024 we conducted 258 audits. That means that every week there are approximately five audits. If you count out Christmas and Easter and all the other holidays and bank holidays, it means that every week there are many groups of people from Orion visiting other companies, checking how those factories are from the quality perspective. I think this also tells a lot about our external suppliers, how many of those suppliers we have. Of course, environment is another very important aspect. Here we've been able to reduce scope 1 and scope 2 emissions by 21% during 2024. We have a very ambitious target that is explained in our report until year 2030. Safety of our colleagues is also very, very important, both in our operations, but in general for all of our colleagues, whether they are working in sales, R&D, operations. To that purpose we conduct safety discussions, safety sessions where we discuss topics in every other management meeting or team meeting. You can see here that 72 of our line managers held this kind of a safety session with their team every month. Of course there might be teams that hold those more often and maybe teams that hold them a bit more seldom. Our Code of Conduct was renewed last year and here you can see that 94% of Orionees have had the Code of Conduct training last year. Of course our target is 100% and in most of the functions it is 100%. Anybody understands that in a big organization people are coming in, new people and going out. There is of course some limitations to reach full 100%. That is definitely our aim because that is implemented in our starting pack. Whenever, when anybody starts in Orion, they need to do the Code of Conduct training. From here on, our outlook remains the same for this year as we have stated in February. It is from EUR 1,550,000,000-EUR 1,650,000,000 regarding net sales and EUR 350,000,000-EUR 450,000,000 regarding operating profit. We will hold Capital Markets Day in Helsinki on May 22nd. I warmly welcome all of you to attend our Capital Markets Day. We will share more light and more wider and deeper information on each of our divisions, their product portfolios, current portfolios, divisions and also operations, current operations. Here you can see other upcoming events for the rest of this year. The half year financial report in mid July and then finally October 1, nine months. At this point I thank you for your attention and I think it is time for questions. I welcome our CFO René Lindell on stage and Tuuka will join us as well. Thank you, Liisa, for the presentation, and as stated in the beginning of the event, we will first take questions through the conference call line. At this point, I'd like to hand over to the operator, please. If you wish to ask a question, please dial on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial 6 on your telephone keypad. The next question comes from Anssi Raussi from SEB. Please go ahead. Yes, thank you and thank you for the presentation. I have a few questions and I go one by one. First one is on Nubeqa and its product sales which were especially strong in Q1. Have you had any discussions with Bayer or do you have a view on this? If it was a bit of pre buying to prepare for the possible tariffs or if it was just purely to meet strong underlying demand. Year over year growth was like 113% or something like that in product sense. All right, a very good question in this current situation that whether this is related to tariffs. To my understanding this is not related to tariffs but really to underlying demand from the markets and patients. Okay, thanks. The second one on your operational expenses, you mentioned in your report that these were lower than you anticipated. Which items are you referring to and what explains lower expenses? Also, do you expect that these, let's call them savings, are coming back later this year? How do you see this? René, would you like to. Yes, I think overall our operating expenses grew year on year if you compare to last year. That is as planned. We've added more projects to our R&D early pipeline. We had the biologics there, so of course the costs have increased and also sales and marketing, we have increased salesforce to drive our business, especially in Europe. Of course there's also inflation otherwise across the board. I think what we refer to is it's a bit lower than we had anticipated overall. Sometimes this is typical in the beginning of the year. Not everything starts as you have planned and some of those costs are probably coming during the year. Some catch up is most likely to happen and are happening at the end of the year. Let's see, I mean it's a typical start I think in Q1, but we expect some catch up on the expenses as well. Thanks. Got it. Maybe finally on Levosimendan. Do you have any estimate when Tenax could complete phase III studies with the. I think they have commented this publicly, yes. If you look at clinicaltrials.gov the current level trial is expected to have a primary readout already in 2026. However, they need to have phase III trial which is then the confirmatory trial which can lead to product registration and this is all based on their statements and they are planning to start the phase III trial during this calendar year. We will have to wait and see when they then expect that trial to read out. Okay, great. Thank you. That was all from me. The next question comes from Sami Sarkamies from Danske Bank. Please go ahead. Hi. I have three questions. We'll take this one by one. Firstly, starting from U.S. import duties, can you comment if to discuss tariffs could have a material impact on Orion's Nubeqa franchise and if you have means to mitigate the impacts through for example price increases or changes to your production setup? I think the situation in general with the import tariffs, whether it's pharmaceuticals or any other goods, is very unclear and it changes from day to day. It is very difficult to make any conclusions at this time to our products. It is not even yet known, you know, regarding pharmaceuticals, at which level of the value chain those would be impacted. Of course, if such tariffs would be set, that would have an impact also for Orion's income. It is still very early and too early to say anything about it. Our biggest sales in U.S., our biggest income in U.S., it comes from Nubeqa and I guess that was what you were referring to. We have nothing to do with the pricing of the product. That is really Bayer's question and should be discussed with Bayer. Any changes or any tariffs that would impact that product would naturally also be impacted on Orion to the certain magnitude that the agreements must state that. We are not out of that scope by any means. I think it's better to wait and see, you know, what will eventually happen with the tariffs. Okay, thank you. Moving on, I have two questions regarding the pipeline. Firstly, starting from the Tenax project, can you please discuss the market potential for the chosen indication? What would roughly be your royalty rate and how does the protection work as Simdax patents have already expired. Let me start and I let Tuka to continue with the market potential. I'm not sure what Tenax has really given out to this one applies the same thing as with our projects, licensed projects with Bayer and Merck. That the best one to comment. This is really Tenax, but that much we can of course share that the agreement is such that the royalties are really low two-digit number for us when the product hits the market and the market potential for such an indication. I think there are very many different, how would I say, discussions on that on different reports that they vary from maybe EUR 1 billion to several billion. I do not think there is any exact information. It's really, you can find it on public sources. You know, this debate on what would be the market potential for this indication. Okay, thank you. Finally, you still did not complete the phase I for ODM-212. Are you still expecting to start phase 2 studies before the year end or is next year a more realistic timeframe? If there is a delay into next year, do you think this could have an impact on R&D cost outlook for 2025? We communicated early this year in February that we will continue phase I throughout 2025. This is really the year when we complete phase I study. There is a new guidance by FDA that you need to collect rather much data to be able to define the right dosing for oncology drugs. Based on that guidance we continue and I think 2026 is a good estimation for the start of the phase II. You asked about the costs. The costs for phase I are included in our budget currently. Okay, thanks. I don't have any further questions. The next question comes from Sian Hammer from Jefferies. Please go ahead. Hi there. Two questions from me. Firstly, is your, if you're allowed to disclose, is your price for Nubeqa with Bayer fixed in the contract, which would imply that Bayer would basically front all the impacts of potential tariffs? Secondly, is there any appetite within the company to divest any of the lower growth businesses such as the generics or consumer health businesses? Thank you so much. I start with the Nubeqa. The price, of course, in the agreement between Bayer and Orion states the price that we, the price with which we sell tablets to Bayer. As I think one of the previous persons asked, what would be the impact of tariffs to Orion? It really depends on what part of the value chain those tariffs would be hitting. You know, whether it's really the price that the tablet is transferred from Europe to us or whether it's the sales price in US. It is really difficult, difficult to say anything about it, but it is definitely sure that whatever spot or segment of the value chain it is, it will have an impact to Orion's royalty income as well. The second question was is there. Any appetite to divest other businesses like generics or animal health? Thank you for reminding me, Tuukka. No, there is no appetite right now to divest any of our divisions. Thank you. The next question comes from Graham Parry. Please go ahead. Hello Graham, are you there? Hi, sorry, it's Graham Parry from Bank of America. I just wanted to understand, follow up on tariffs again in terms of the shipment of the product, is that actually shipped across the border in the U.S. by Orion or is it shipped across the border by Bayer? Who actually owns the product at the point of shipment? If we wanted to understand various different scenarios when, if and when there's a tariff announcement, how that exposure sits. If it was, for example, Orion shipping it across the border, would you have a full exposure to the tariff? Or if it's Bayer, would Bayer have exposure to the tariff, but then contractually they could pass some of that down to you. Secondly, on tariff, if Bayer were to raise the price in the U.S. to pass on any impact of tariffs, presumably that would also benefit your royalty as that's based on in-market sales in the U.S. Thanks. Yeah, this is exactly very, very valid and good questions. That we sell the tablets to Bayer and that happens in Europe, so they ship it to us. Of course, if there is some kind of a tariff on that one, they are responsible for it. Of course, there are many parts in the agreement that would partly affect also us. You know, as I said, any tariff on any part of the value chain will also have an effect on us. Similarly, if they would raise the price in the U.S., that would have an effect on our royalties as well. It will continue. Yeah. Raising prices would have a mitigating impact. Exactly. If that tariffs we would feel the impact proportionally. If they can raise prices, then we also get benefit from that. Exactly. It goes both ways. Yeah, that's super clarity. You effectively share the tariff regardless where it is and you benefit from any price increase in royalty. You are effectively sharing it contractually. Second question for me is just when should we expect the cost of the Cambridge R&D facility to start to appear in your R&D cost? Thanks. Those costs are already included to that amount that we think they will accrue to this year's R&D budget. Sorry, just to be clear. I understand that's in your guidance, but have they started to be incurred in Q1, or is this something which is going to be more back end loaded into the cost for the year? Sorry, Graham. Yeah, it will be more back ended, clearly. Yes, thank you. The next question comes from Anssi Raussi from SEB. Please go ahead. Yes, I have one question left actually and it's on DVN. Really strong growth in Q1. Was there something extraordinary or is it just picking up in the patient growth? It is picking up. It's been picking up actually for a few years now. If you look at the numbers, I think it started to pick up right after the COVID or the last year first with the 10%, 5% growth. 10% growth, 15%, 20%. It's actually accelerating all the time. Now it was 30%. That's really a market demand of this type of treatment. This is an estradiol mainly, the Divina series growth is mainly due to the estradiol gel that we manufacture and sell across Europe and in some other countries. It's really the market demand for this type of product. Okay, thank you. There are no more questions at this time, so I hand the conference back to the speakers. Thank you. We have a few questions coming online, but before going there, we actually forgot to answer one of Sami's questions regarding the Levosimendan protection. Yes. Again, Tenax would be the right party to ask this about the protection. You are correct. The molecule Levosimendan is not protected anymore. In the U.S., you can get data protection based on the data you produce in your clinical studies for certain indication. I would assume that the protection, market protect, that's called actually data protection or market protection. The business case is based on that one. Thank you, Liisa. We can turn on to the webcast questions. We have first couple of ones from Onni Hautala from Nordea. Does Orion have other clinical trials being developed by partners that could enter Orion's pipeline in the future? If so, can you mention what is in phase II in such cases? I guess on this, referring to Levosimendan. Case here, I fully understand this came. It might seem that it came out of nowhere, but that's not really the case. We report key clinical projects, which for us means phase III projects. Clearly we are not reporting phase II's except the CYPIDAS, which is there still ongoing. There might be phase II's if we really think that they are key ones. I'm trying to think really our partners, that is there something that would be going on that would result in a similar type of race to our clinical pipeline? Nothing comes to my mind currently. Of course, regarding Opevesostat, we have stated that we will include phase III's, but if you take a deeper look at MSD or Merck, they have some phase II's ongoing, for instance with combinations targeting prostate cancer. That's very, very true. I guess Dave shared some information on those. I hope actually that we could discuss more of those in our Capital Markets Day. Absolutely. All right then, moving on, another question from Onni Hautala and still regarding Tenax as Levosimendan case. Can you further explain Orion's role here? What part of the intellectual rights are owned by Orion and what will be Orion's role in the future? Our role is really such that we've licensed the rights to develop oral Levosimendan for this indication to Tenax. We also develop the pharmaceutical products itself. Since we know Levosimendan very well, it's quite natural that we are responsible for the product development here. Of course it remains to be seen whether we manufacture the product or not in future. Otherwise I think that's in all its simplicity, our roles in this agreement. Great. Thanks, Liisa. Moving on, another question regarding R&D pipeline coming from Mr. Alabdas. This is actually referring to ODM-111. Can we expect the preclinical data on ODM-111 at any conference? Do we have any plans to publish the preclinical data? I'm sure that the clinical data probably will be published at some point, I'm sure. This is something that you will also hear more at our Capital Markets Day. Welcome to listen to Outi Vaarala, our Head of R&D. Since I can't say that whether we are going to publish that or not or when we are going to publish that. Thanks, Liisa. Moving on, we have one question regarding branded products and Entacapone. This comes from Alexander Huitfeldt from Chingo. Beyond Entacapone sales in Japan, are there any other key initiatives or growth drivers within your CNS portfolio that you are currently developing or prioritizing? Are there any products or indications you are especially focused on going forward? Excellent questions. Yes, we are focusing in CNS and in CNS definitely to Parkinson's disease. Orion is still very well known in that sphere and we've been approached by many companies that have this type of value added products which are maybe combinations of older molecules or new formulations of older molecules for Parkinson's disease or other neurodegenerative diseases. We are building a portfolio around Stalevo and Comtess and Comtess currently and there I think the first launch would be this year in Finland for this type of a very microscopic or small kind of a powder product of Entacapone combined to some other drugs that would allow patients to titrate their dose in a better way than with Entacapone. It would be the segment would be on a rather late state of the disease before very much more rougher treatments like intestinal dopamine or other that type of treatment. There will be new products and again I repeat myself, I'm sure Hao Pan, who leads the branded products division, will shed more light on this portfolio in the Capital Markets Day. Thanks, Liisa. We can continue on Capital Markets Day. There's a question from Christopher Arnemark from Handelsbanken and that will you provide additional information regarding the capital allocation strategy during the CMD? The balance sheet is solid. It seems to be a number of M&A possibilities out there or is it still dividend focused? Yeah, I'm sure we also discussed the capital allocation at that point. Maybe it's good to remind that we haven't changed our financial objectives as they are today. Moving on, we have one question from Matti Arola from OP regarding potential tariffs. Could you please remind us the key advantages that Nubeqa has versus competitors and why U.S. doctors would prefer Nubeqa over other products despite the potential tariffs? We have discussed the benefits of Nubeqa earlier. It's very much the side effect profile. It's as you would say, it's a very kind drug to patient. Usually cancer drugs have this and that as a side effect. We do know from experience and what doctors are telling us that the side effect profile is very nice and they like and of course patients like that type of a product. Whether this plays a role when you talk about tariffs, I don't really know. It's very difficult to define any such criteria for any drug or any group of drugs that would make them more preferable than others. If tariffs are set. Of course pricing, I exclude pricing from this. Pricing would definitely play a role there. I think it's really the known effects of Nubeqa both on the side effects and the efficacy of the drug. Thank you, Liisa. Now it seems that we have exhausted the questions from online. Thank you at this point for the lively discussions and questions we've received. I understand that there might be one more question online in the teleconference line. At this point I again hand over to the operator. The next question comes from Matti Arola from OP Corporate Bank. Please go ahead. Hello. Thank you. You already replied to my question that I sent via chat. So nothing to add from my side. Okay, thanks Matti. I guess there are no further questions online in the teleconference lines. At this stage then it's time to conclude the event. Liisa, any final words? I thank you for your attention and of course all Orion colleagues for the good quarter one. We continue the year as we have promised within our outlook. Thank you.