All right, thanks for joining us for this next session. I'm Tim Anderson, the U.S. large-cap pharma and biotech analyst at Bank of America. Very happy to have with us three speakers from AbbVie: Jeff Stewart, Executive Vice President, Chief Commercialization Officer. He's been in that role since 2020. He joined AbbVie all the way back, I think, in 1992. Long time. We have Dr. Roopal Thakkar, who's Executive Vice President, R&D, Chief Scientific Officer at AbbVie. He's been in that role since 2023, but joined the company back in 2003. And then Scott Reents, who's Executive Vice President, Chief Financial Officer, a role that he's been in since 2022, I believe. And you joined the organization back in 2008. Prior to that, you were advisor in pharmacy. We will start off like we've been doing all these sessions with some macro questions. I'm trying to ask a similar set of questions to all the management team so I can pull together, you know, what everyone's saying. I know these are tough questions to answer. Just starting off, level of disruption and how much time this is taking. Talk about MFN tariffs, everything else. Are you guys actively involved in day-to-day discussions and contingency planning and trying to figure it out? Is that a separate group doing it, and you guys are just running day-to-day and no changes? You know, I think like everyone, I mean, certainly there is some disruption from the standpoint of just taking additional time. It is not disrupting the business, not disrupting our ability to execute, but certainly it is something that we are spending time on. We are a pretty hands-on management team. When we see these things, you know, we work together with our teams and we, you know, inform our board about what is going on. We do a lot of work around trying to understand the implications and also contingency planning and mitigation efforts and things of that nature, of course. MFN, you know, everyone's trying to figure out, is it real? Is it rhetoric? We had a panel of policy folks yesterday at lunch. One of the speakers, you know, really painted a picture of this is going to happen. Others don't necessarily agree with that. I feel like this sort of thing personally to me is rhetoric, but I'll just put the question to you. Real or rhetoric? We've seen an executive order in 2020. Nothing came of it. We have a new executive order. Trump does seem bent on doing something more this time around on drug pricing in one form or another. Is this something you guys are taking serious? Yeah, maybe I'll start and I can chime in. I think we have to take it seriously. You mentioned, Tim, you know, that we have significant horsepower back at the office. We've got connections with Washington to really start to triage and understand this. Obviously, it's still very fresh and very new, but nonetheless, it is a significant disruption. Now, we saw, you know, in the first administration, this approach, it was sometimes tailored with all the discussions that we all remember around the rebate rule and rebate pass-through and what that would mean for premiums. We are carefully assessing that. We want more details, and we're going to work very hard to get as many details as we can. You know, the full scope, you know, what segments of the government, you know, B, D, Medicaid. We have some semblance of timing. I mean, I think if we take a step back, you know, there are certain things that we've been very pleased with with the administration. For example, we know even before with IRA, the idea that there was an affordability focus, you know, with the cap and smooth, that's something that we heavily lobbied for because we thought that was the right thing to do. You know, that's in place now. We also think that some of the more recent commentary around the nine and 13 on the IRA, because we think, you know, the nine years for small molecules or innovative small molecules, not good for innovation. That is encouraging. We will have to see how this EEO starts to play out. Suffice to say that we'll be working very hard over the next days to make sure that we're in the best position to handle it. Another question that we've been asking is just this "equalization of price," which would imply U.S. prices go lower, ex-U.S. prices go higher. As a drug manufacturer, correct me if I'm wrong, you really don't have any ability to raise ex-U.S. prices above and beyond where they are today. Is that correct? You know, that is correct. I mean, to some degree, again, when you step back and look at this, is that while there has been some moves towards, let's say, a pilot program in Europe for like a European HTA, it's really very preliminary, super non-binding. You have different systems, as you know, across the continent. You know, the HTA systems, you have budget impact systems, you have different philosophies. It is not immediately apparent that that is certainly something in the control over a manufacturer in terms of the equalization of pricing. Now, having said that, you know, if you look at the investment, the way investment flows around the world, you know, we're in constant discussions with the Europeans through the trade associations at the commission to sort of say, hey, if you have basically these sort of price controls or de minimis type of approaches with pricing or lack of flexibility, you get your populations with less access or delayed access to new innovations. The concept of sort of transferring that over to the U.S., probably not the best policy, but again, we'll have to see it. It is very difficult to see how pricing equalization would work as we sit here today. The hard thing for folks in our position is to really understand what the pricing disparity is between net U.S. prices and, let's say, European net prices. I know you probably won't give us any data points that are AbbVie specific, but just your general understanding, rule of thumb, I've always been under the impression it's 20-40% cheaper in Europe versus the U.S. Not those aren't AbbVie products necessarily. You see a lot of numbers out there now, including recent ones that say, oh, no, no, it's a much bigger discount. I'm not sure I believe that, but any data points you want to throw out there that are high level? I mean, there's been some analysis that's been done where it's actually maybe a little closer than one might think, because when you start to go through all the government channels and you look at, you know, CPI penalties in Medicaid and, you know, the different, even with IRA, the different ways of negotiation and the cost shares on the 10 and 20, and you just cascade all that down or the rebates, you know, and then even if you adjust for per capita, it's probably not that big of a disparity. Again, I think that's many things that we have to work through. I mean, people sort of default to what does that list price look like? And that's clear that there's a very large disparity. We'll have to continue to sweat those details and understand how that all sort of flows through the system, you know, as we go forward and see, to your point, is it rhetoric, is it negotiation or what have you? It might have been two years ago, and I think you were probably on this call. We do these commercial strategy calls where we just focus on the commercial side of the business. The question we had asked at the time, and we were asking it of many companies, was related to IRA, would IRA negotiate a price spillover to the commercial book of business? AbbVie's view was, and I think it still is, is no, there really probably won't be much of a spillover, which is more of a unique point of view. Other companies have felt there will be some spillover. Now let's take that same question and apply it to MFN. If you were to have MFN pricing applied to Medicare and Medicaid and government programs, do you think there would be inevitable substantial leakage to the commercial book of business? I still think that, you know, our position or my position is that it is unique to the government channels. I've talked a little bit about the history there where, you know, and I've been, you know, involved over my career in these negotiations with payers. Certainly, if you look at, you know, different segments of government payers, you know, you have the VA system and the DOD where you have the federal supply schedule and that sort of a calculated price, which is often much lower than where you have your commercial prices. While some people would say, hey, maybe we should, you know, can we get that price? The answer is no. There's a basis of competition and there's, you know, that's sort of a government channel with really price regulations. I'd say it's the same thing for Medicaid. I mean, we have discussions to say, you know, if you have a more mature brand where you have CPI penalties and you ultimately have quite a low net price and maybe it also is calculated in a commercial best price, that price is often far below your commercial negotiated prices and it does not slip. I think with IRA, it is very constrained. I think the commercial prices will be largely walled off. Not that the negotiators on their side will not ask for those price concessions, but I do think it will be fairly tight. I would suspect, I mean, it is highly speculative, right, that I do not even know if MFN will go into effect, that that would be a government action or scheme for those segments as well. I think I feel fairly confident we are not going to see big slippage. I mean, that's my point of view too, but there's a lot of debate on that front. Okay, a question. I think I might have asked this on your quarterly call. It's even more pertinent now. Advertising from direct-to-consumer advertising, RFK was out there by press reports saying you guys, not you guys, but the industry needs to pull the brake, pump the brakes on DTC advertising. AbbVie is the biggest DTC advertiser in the group. There's independent data that shows how much you guys spend. And you guys have obviously determined that's a very cost-effective marketing approach to spend those dollars. So if you're limited, is that impair the business? I think it would. Do you think it could be limited? I'm not sure that it would be limited. Now, in reference to your first point, I mean, we're an active management team. We would start to prepare for different contingencies, right? Certainly, it would affect the whole industry. In that sense, if there were, you know, if you look at mass media or TV commercials, there would be far less investment because presumably there would be some constraints on mass media. We would have to pivot, right? We would be capable of thinking about, you know, disease awareness campaigns that would also help to stimulate education of the consumer. I suspect that there would still be an ability to speak to that consumer via digital channels. It may just be that, well, we don't support the mass media. We look through all of our channels, all of our returns. We would look at different models of communicating with the consumers that we thought were equally as appropriate as we do now with DTC to be able to continue to, you know, drive our commercial model and authentic communication with consumers. That is how we are thinking about it now and we would think about it going forward. One last policy question here. This one's on tariffs. On Pfizer's Q1 call, we asked the question to Albert, do you think this will be ring-fenced to certain geographies like China? He suggested it might be, and stocks rallied strong on those comments. What is AbbVie's view on tariffs? We have some news, of course, that's come out since then with the U.K., for example. How are you guys viewing tariffs at the moment as a threat? It seems like it's kind of taken a backseat to MFN, frankly. Yeah, I mean, I think a week ago we probably would have been talking, you know, a lot more about tariffs than we are right now, just given how things have evolved. When we look at tariffs, you know, certainly the president said early last week he would announce something in the next two weeks from then. Maybe it's in the next week if that holds. You know, the investigation results have not been released from a 232 perspective, and we'll have to see what those come out with. I would say that it's hard to handicap exactly what that looks like. Maybe there'll be a phasing in. There seems to have been some acknowledgment that, you know, certainly plants and manufacturing capabilities can't be built overnight in the U.S. We will see where they come. I would say no matter where they come from, the pharma-specific tariffs, you know, when we look at it, you know, we've got a very complex and resilient supply chain. One of the things that we've always focused on is making sure we have the products coming to our patients, assurance of supply for those patients. That builds in, you know, to a supply chain and a manufacturing process, some optionality. Certainly, as you know, we've started to look at the tariffs and we pulled together, you know, a cross-functional team because it does impact people throughout the organization to see what can we do to look at, you know, the impact of what this might be in to mitigate. You know, we've done a lot of work around mitigation activities, you know, leading up to with inventory management, making sure we're optimizing our supply chain. We will just have to wait and see what is announced. If something is announced, of course, 2025 is going to be a part year. We have some ideas and thoughts around how to mitigate the impact in 2025 or help to mitigate it from efficiencies, productivity initiatives. Our business has been performing. We have some very strong momentum in the business. Our first quarter results were above expectations. That would also be something that we would look to to help to mitigate any impact of tariffs. Okay, a non-policy, but still a general question, and it's really on M&A. A strength of the AbbVie story is between now and 2030, you essentially have no patent expertise. When you look from 2030 to 2035, there's a lot of expertise. SKYRIZI, RINVOQ, VRAYLAR, IMBRUVICA, VENCLEXTA, I think one of the migraine products falls in that period. It's far away. It's too far for most investors to think about. You guys run 10-year planning cycles. You are looking at that period. You are looking at your pipeline today. I think there's the perception that the late-stage pipeline at AbbVie could be more full. Where is your head on M&A at the moment? Yeah, look, when we look at M&A, it's not dissimilar from what we've been doing. If you look at the transactions that we've entered into, a little more than 25 transactions since the beginning of last year, the beginning of 2024, that has been driven to, you know, essentially the time period that you're talking about, Tim, making sure that we're filling out and have all the mechanisms of action that we would like in neuro, immunology, oncology, building up that. We have, you know, a robust pipeline so we can continue to develop things. That's going to continue to be our focus. It's not that we're constrained by our balance sheet or leverage charts. We have a very strong balance sheet. We have the ability to do what we want, but it's really fitting in with that strategy. We have all the assets in place today to provide growth for at least the next eight years, as you refer to. We continue to feel very confident about our high single-digit growth rate through the decade. That is in place. It is really geared towards more early-stage things looking to the future. Okay, let's talk about obesity if we can. A new area for you guys, it to me makes a lot of sense. A couple of years ago or maybe even a year ago, you guys had kind of consistently disavowed getting into the space, and then you pivoted in a way, and you did this licensing deal with Gubra for an amylin compound. Maybe just remind listeners why the change in heart. I don't know if I would say it was a change in heart, to be honest with you. I mean, certainly it's an attractive market. I think all along we have thought if we found the right asset with the right level of differentiation, and I think it would be helpful for Roopal to, you know, give some insights to what we saw with this particular asset. I think, you know, we are a company that, of course, is always going to be opportunistic. We're always going to be strategic in looking at how we're doing things. It's an important area, and it's an area that we couldn't, you know, didn't want to stay away from if we were able to find the right differentiated asset. That's what we've done. Yeah, I mean, I think that's what it is. It's a thoughtful approach, and until you see the right entry point, that's the one we saw here with Gubra. We like the upfront. We like the 100% control at the commercial level and at the R&D level. We like the amylin class. We like the IP that stretches out into the 2040s. We like the long half-life. We like the delayed Cmax or where the Tmax hits, which is about 40 hours. Saw that as a potential for better tolerability because that's the insight we were having as we were monitoring the space that 30% will drop in a month and 60%-70% will drop in a year. These patients will likely come back, want something else, want something different, even though this comes a little bit later. The tolerability was key, the half-life being long, twice a month, maybe even once a month in maintenance. These are all, I would say, really nice parameters that we saw that would potentially lead to a differentiated profile. Pre-clinically, we see maintenance of muscle mass with the current assets. You could see up to 40% loss of muscle. We see bone preservation through calcitonin. It's a DACRA pathway. A lot of nice things that we see, and we're going to drive that. In the early data that we've seen here up at six weeks, already seeing almost 8% weight loss at a very low dose. We'll continue to test that out to 12 weeks, looking at titration, looking at dose extensions. Then we'll start seeing some data next year and be able to design a robust phase II-B program. We had Amgen on stage prior to you guys, and the question I asked them was if you're not, you know, Nova or Lilly and you're trying to come into the market, in my opinion, it's tough just to have one compound. I think companies probably need to have a portfolio of compounds. We've talked to you guys about this in the past. Your view on additional assets and is GLP-1 on the target list to bring that into the organization as well? You talked about dosing of your compounds. It sounds like every two weeks to start with induction and then maybe shift to monthly maintenance. A long-acting GLP would be something that would be fantastic to pair with. Yeah, I wouldn't rule out any particular mechanism as we looked at the Gubra deal. The right fit, the right profile would make sense. We would go forward. The other thing I should mention we liked about the Gubra asset is the neutral pH for the formulation. That might create a little more opportunity, flexibility for co-formulations. Whether it's a GLP or another mechanism that can create more ease for our formulators to get something together so you don't have to do multiple injections. You guys have a way to go with that compound, right? I think that's phase I. We'll be advancing further. I'd love to get your perspective on choosing to enter this space. You're not going to be selling your product this year. I don't know what you want to call it, 2029, 2030, something like that. Using a crystal ball, what do you think the world is going to look like in obesity in a five-year window when we get to the end of the decade where you guys will be launching? It's really a pricing question more than anything else because that's probably the biggest debate at the moment is where is price going to go in this category, not only near term, but as we get the third and fourth and fifth and the 10th product coming in. My view is that these are not extra expensive drugs. When I look at the value they provide, they're actually cost-effective. I think ICER will probably end up making that determination. I'm not convinced pricing needs to just continue to fall. In most categories, it doesn't. Is this going to be different? I think you're right. I mean, I think already if you look at the, and I think we're like in the, not the first inning, but like half inning of the game, you know, to use the baseball analogy. If you look at just the way that over the history of this industry, the way that markets evolve, I mean, it's hard to really envision when you're in the first inning. All we can say is like, look, there are the unmet need is enormous. The prices in the big scheme of things are already quite low. I think that when you start to bring differential innovation into the market, I mean, Roopal highlighted it, people are going to have lifelong problems with this condition, right? There's a billion people or more, and that market will start to cascade. I think the prices in general will always be quite low. I do not see this like just disintegrating across the board when you can suddenly bring in a differential asset that people can, you know, find it much better tolerated. Their muscle mass is differently. The dosing is differently. You get to a really, really nice way through clinical trials to think about maintenance doses. I believe that we are very aligned, Tim, with your sort of point of view. I think this market is just going to grow and grow and grow. It is going to fragment. There are going to be different segments of people that pursue weight loss. I think there will always be a significant cash pay component to this market, which there already is now. That is one of the reasons, not the primary reasons, but one of the reasons with our aesthetics business that we thought that this was also quite interesting in terms of our ability to sort of win and play in that channel as well. Yeah. Okay, good. Let's pivot to immunology. This is the biggest bucket of revenues for you guys. Really, it's kind of a similar question. It's pricing in this category. What you see happening beyond 2025, this year, you know, is marked by a new mechanism going off patent or a new product going off patent, which is Stelara. We have Humira already off patent now for a few years. When I look forward, you know, ENTYVIO, biosimilars are a couple of years away. Are those never going to really have a material impact either on SKYRIZI or RINVOQ or pricing in the category? I mean, pricing has gone down every year in this category. Single digit%. Is that what we should just expect over the next five years? I think that for sure, if you take a step back to your point, that this is a volume game. I mean, this is a volume-driven market. We talk about how robust the markets are in immunology. I mean, most of the penetration rates are still quite low. I mean, the highest penetration rates in the biggest unmet need is, you know, mid-40% for IBD. So there is plenty of headroom. We have also talked about the way that since these are lifelong conditions, that as people age and innovation comes in, line of therapy advances. Now, you know, you have meaningful third line plus market sizes in many of the immunology markets. Certainly, market share gains are going to be a big piece of our story given the differentiation of the product. In some ways, we have anticipated there always is price pressure. It's been, you know, low single digit. But, you know, having 10 or 12 head-to-head trials and we keep announcing more is some way for both payers and for the prescribers who actually can see the benefit to distinguish these brands. And so we feel pretty confident. I mean, we know ENTYVIO, LOE will come at some point. Plus, it's very significant in ulcerative colitis, particularly. And, you know, last year, we announced the, you know, the 11th head-to-head trial where we think we have high confidence we will win. So I think it's a combination of our development program and the ability of these products to continue to perform. So, but we do, you know, net-net plan for price degradation over our planning cycle. You guys recently stepped up SKYRIZI guidance to 2027. I still think it's too low. That product is straight up. And what is going to slow it down? That's a good question. I mean, I'll let Scott talk about how the guidance works. Look, we're very, very pleased. Again, we have the right assets at the right market. Look, there is competition. Fundamentally, we still feel that in some ways, that's not necessarily a bad thing based on how markets grow and cascade. I don't know, Scott, you can talk about how we think about our guidance for our brands. Sure, certainly. You know, in 2027, SKYRIZI and RINVOQ combined $31 billion. That was an increase for SKYRIZI of $3 billion and RINVOQ for $1 billion. So SKYRIZI's $20 billion of that, RINVOQ $11 billion of that. I would say it was, you know, the increase was across all indications. I would say IBD in particular is growing at a faster rate for UC and CD, but it's, you know, strong growth across. I think we continue to see momentum. You saw us also increase our guidance this year between the two of them by $900 million in the first quarter. RINVOQ, your oral therapy in immunology. We kind of picked up through industry folks that docs are getting more and more comfortable with the safety of that profiling, right? There was the big shock event from XELJANZ a number of years ago. As a black box, the possibility of getting a black box removed off the label? I think it's tough. I'll turn it over to Roopal, but I think one of the things is there is increasing comfort with RINVOQ. It's growing in all the indications quite nicely. And as you know, in the majority of the indication, it is stepped behind a TNF based on that issue. It's really a second line and third line agent. We can co-position it very effectively around the world with SKYRIZI because of really that fact base. We recently got a new approval, GCA, where there was no step. Now, it's a little bit of a different dynamic there. It is really GCA is the first of our sort of third wave of RINVOQ indications where we will have, you know, five new ones that come over the next few years that will add probably, you know, at least a couple of billion in incremental revenue as we run into the 2030 timeframe. I do not see that it is a clear path to sort of fundamentally change it. The marketplace is speaking, Tim, to your point, where there is significant comfort level as you get into, you know, we launched RINVOQ in 2019. There is more and more comfort. Yeah, in terms of a box warning, I think it'd be challenging outside of an outcome study to rule it out. You wouldn't be able to enroll it. What would you compare against? As Jeff stated, there's an increasing comfort as they see the data, particularly in non-rheumatoid arthritis. Even in GCA, the average age of those patients was 70, which is much higher than rheumatoid arthritis, high dose steroids, high cardiovascular risk. We saw one or two cardiovascular events, and they were in the placebo arm. That was a week 52 study. Not that that overturns the box warning and the need to communicate that, but that direct data is in front of rheumatologists that they'll now see, and it'll just reinforce the safety profile that they've seen in their own patients. Even the atopic derm indication is a little looser, right? It doesn't say you have to fail anything as clearly. Can you just talk about where use of RINVOQ is really specifically in treatment-naive frontline patients? Yeah, so basically you're right. Our indication is after a systemic or a biologic. You can look at that as if you've already tried like a cyclosporin or mycophenolate or some of the older generics, you can go right to RINVOQ or you can use it after DUPIXENT. I mean, most of our business is after DUPIXENT. DUPIXENT failures. We do have, you know, maybe 20% of our market is actually prior to DUPIXENT after one of the older generics. You know, it's clearly a very important drug in the armamentarium. We are a clear number two in that marketplace. You know, DUPI is obviously the big incumbent. We're pleased with the performance because we can still capture, we're capturing roughly 20, you know, low 20s% of in play share in a market that's growing very quickly. That market is the fastest growing immunology market. Last question because we're out of time. Just your views on oral IL-23. J&J and Protagonist have the cyclosporin. Data quite compelling in psoriasis, even more compelling in the phase II IBD data. That's a disease where you commonly use orals. There's a paradigm there. Is that a threat in your view to your injectable products like SKYRIZI and to RINVOQ? I think what we've seen is that the oral medications are, you know, while they're modestly effective, they don't give the same type of clearance or effectiveness as the injectables. Now, they are IL-23s, but they're more somewhere like a Stelara type patient, which has really been ablated in the marketplace. Now, having said that, I do think it will be a meaningful product. And by meaningful, I mean that, you know, if you're thinking of OTEZLA or Deucra or the way that the, particularly the U.S. market, because it's really the orals only really play in the U.S. market, how those are positioned over time. But I think that the injectables based on their convenience and also just the level of efficacy will be insulated from, let's say, a direct impact. Great. Okay, we are out of time. I wanted to very much thank you, Jeff, Scott, Roopal. Thanks to AbbVie for showing up today. Yeah, thank you, Tim. Thanks for having us. Thank you.