Good day, thank you for standing by. Welcome to the AbbVie Investor and Analyst Conference call. All participants will be able to listen only until the question- and- answer portion of this call. You may ask a question by pressing star one on your phone. As a reminder, this call is being recorded. I would now like to introduce Ms. Liz Shea, Senior Vice President, Investor Relations. Good morning, thank you for joining us for this special conference call to discuss AbbVie's acquisition of Apogee Therapeutics, which we announced earlier today. Joining me on the call today are Rob Michael, Chairman of the Board and Chief Executive Officer, Roopal Thakkar, Executive Vice President, Research & Development, Chief Scientific Officer, and Scott Reents, Executive Vice President, Chief Financial Officer. Joining us for the Q&A portion of the call is Jeff Stewart, Executive Vice President, Chief Commercial Officer. We have posted a set of slides with additional background for your reference, which can be found on the AbbVie investor website. Before we get started, I'll note that some statements we make today may be considered forward-looking statements based on our current expectations. AbbVie cautions that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated in our forward-looking statements. Additional information about these risks and uncertainties is included in our SEC filings. AbbVie undertakes no obligation to update these forward-looking statements except as required by law. Following our prepared remarks, we'll take your questions. With that, I'll turn the call over to Rob. Thank you, Liz. Good morning, everyone, thank you for joining us to discuss the acquisition of Apogee Therapeutics. Apogee will bolster AbbVie's leading immunology portfolio by adding multiple differentiated assets across several large and growing disease areas. The acquisition is expected to create significant shareholder value, with mega blockbuster peak sales potential anticipated across Apogee's pipeline of assets. This will be enhanced by AbbVie's regulatory and clinical expertise, exceptional commercial capabilities, and broad global infrastructure. This transaction is an excellent fit with our strategy to build and advance a compelling pipeline with new sources of growth to support AbbVie's performance in the 2030s and beyond. Apogee's pipeline is highly complementary to our development strategy in immunology, where AbbVie is the clear industry leader. For more than two decades, we have focused on redefining the standard of care with differentiated therapies across a broad set of diseases. Skyrizi and Rinvoq have delivered on that objective, with development programs either approved or ongoing across more than a dozen indications. This includes numerous positive head-to-head studies versus other novel orals or biologics. While both products are expected to grow well into the next decade, our goal is to ultimately launch new medicines that offer higher efficacy, greater convenience, or even a functional cure. AbbVie's existing immunology pipeline includes unique combination platforms, long-acting and bispecific antibodies, novel orals, and B-cell depletion approaches. These are all strategically being developed to substantially raise the bar for efficacy and convenience to further improve patients' lives. Apogee's pipeline further augments our efforts, adding multiple differentiated assets for potential treatments in dermatology, respiratory, and other related inflammatory diseases. We are especially excited about zumilokibart, which has the potential for a best-in-category profile with strong efficacy and significantly improved convenience in atopic dermatitis, along with multiple indication expansion opportunities. This adds even more depth to our robust pipeline in immunology, which we expect will be a major growth driver for AbbVie over the long term. In addition to immunology, we expect to drive growth across multiple areas of our diverse portfolio. In neuroscience, we have strong positions in psychiatry, migraine, and Parkinson's, with each having $5 billion+ peak sales potential. With our next-gen assets, bretisilocin, emraclidine, and ABBV-932, we see meaningful opportunities to further augment our growth in psychiatry well into the next decade. In oncology, we are making excellent progress across both heme and solid tumors. Our late-stage assets, etentamig and Temab-A, each have multibillion-dollar peak sales potential. We are advancing several other exciting ADCs, including 706 and 969, following encouraging mid-stage data. In obesity, we continue to advance our Amylin program, which also has the potential to drive strong long-term growth for AbbVie, complemented by our commercial footprint and capabilities within aesthetics. In summary, this transaction represents an extremely compelling opportunity for AbbVie, Apogee, and our respective shareholders, and importantly, for patients. With that, I'll turn the call over to Roopal, who will highlight Apogee's clinical programs in more detail. Roopal. Thank you, Rob. This transaction adds a portfolio of novel, long-acting antibodies that further strengthen our immunology pipeline. AbbVie has more than two decades of experience developing differentiated therapies in immunology. Our leadership is a result of our deep scientific expertise and our commitment to deliver innovation that improves patients lives. We have demonstrated an impressive track record across a broad range of autoimmune diseases that have redefined the standard of care with Humira, Skyrizi, and Rinvoq. We continue to pursue next-generation therapies that have the potential to set an even higher bar for efficacy, safety, and convenience. AbbVie's current immunology pipeline is very robust and includes several innovative programs to address unmet needs across various diseases, including combination approaches in IBD, evaluating Skyrizi with our alpha4 beta7, TL1A, and potentially TREM-1, as well as novel combo programs across rheumatology and dermatology. Longer-acting antibodies, including a new anti-IL-23 for psoriasis. Several bispecifics, including lutikizumab and an anti-IL-13/31 and IL-13/18. Oral agents including an anti-IL-23, an IRAK4, and LPAR inhibitor. A B-cell depletion program, including our novel in vivo CAR T as well as anti-CD19 antibodies. Apogee's pipeline is highly complementary to our immunology development strategy and adds a portfolio of long-acting, high-efficacy novel biologics targeting dermatology, respiratory, and other immune-mediated diseases. Apogee's most advanced asset is zumilokibart, an extended half-life anti-IL-13 antibody with a lead indication in atopic dermatitis, where it has demonstrated strong lesion and itch control across a robust two-part phase II study. In Part B of the study, zumilokibart demonstrated high response rates across key efficacy endpoint at 16 weeks, including EASI-75, EASI-90, and importantly, improvement in itch, which is particularly bothersome for patients. Results from Part A showed durable maintenance of response for one year with sustained efficacy for both every three months and six months dosing. The extended half-life enables a substantially lower injection burden for patients relative to currently available biologics. zumilokibart was well-tolerated across the phase II program with a favorable safety profile. phase III studies in AD are expected to begin in the second half of this year, with readouts anticipated in 2028 and regulatory approval in early 2030. Given the potential best-in-category profile, including strong efficacy and convenient dosing, we believe zumilokibart has the potential to become the preferred early line therapy for moderate to severe AD, which would be a highly complementary offering to Rinvoq, a very effective oral option for AD patients not adequately controlled with other systemic drugs, including biologics, and to other indications where IL-13 plays a critical role. We plan to begin development as a monotherapy in prurigo nodularis, chronic pruritus of unknown origin, eosinophilic esophagitis, and chronic spontaneous urticaria. We anticipate a steady cadence of data readouts across these indications over the next several years, with potential approvals beginning in the early 2030s. Another exciting asset from Apogee is APG273, a combination of zumilokibart and APG333, an anti-TSLP antibody. This combination has the potential to provide transformational efficacy in type two, low and high asthma, along with an extended dosing interval. We plan to begin clinical studies in asthma soon with potential launch in the mid-2030s. In parallel, we also plan to explore development of APG273 in COPD and chronic rhinosinusitis with nasal polyps. In summary, Apogee's differentiated portfolio is a strong strategic fit for AbbVie. These promising new assets span indications across dermatology, respiratory, and other related inflammatory diseases and meaningfully add to our deep immunology pipeline. With that, I'll turn the call over to Scott. Thank you, Roopal. This acquisition provides AbbVie with multiple high-value pipeline assets, which further strengthen AbbVie's prospects for long-term growth. Under the terms of the proposed deal, AbbVie has agreed to acquire all outstanding shares of Apogee Therapeutics for $135.11 per share in an all-cash transaction. This reflects a total purchase price of $10.9 billion, with an implied transaction value of approximately $10.1 billion, net of estimated cash and marketable securities acquired. We will fund the deal with debt. We see the potential for significant shareholder value creation with mega blockbuster peak sales potential across Apogee's pipeline. Zumilokibart in atopic dermatitis represents the most substantial component of the deal value given the data generated to date and highly differentiated profile potentially. More modest value has been ascribed to APG273 given the earlier stage of development. This is a financially attractive transaction for AbbVie. We anticipate earnings accretion beginning in 2032 and significantly ramping over the long term. Assuming a deal close in the third quarter of 2026, we anticipate the transaction to be approximately $0.14 dilutive to our adjusted earnings per share in 2026 and approximately $0.46 dilutive to earnings in 2027, reflecting the full-year impact of new expenses and deal financing. Additionally, we intend to exercise the buyback option for change of control under the Apogee revenue share agreement with Blackstone Life Sciences to reduce a significant portion of the expected future royalty obligation for zumilokibart. Lastly, it is important to note that there is no change to our capital allocation priorities. We remain committed to a strong and growing dividend and continue to have the financial flexibility for additional business development. We also do not anticipate a change to AbbVie's credit rating as a result of this transaction, as we are committed to achieving a net leverage ratio of 2 x within two to three years following the Apogee deal closing. In summary, this is an exciting day for both AbbVie and Apogee. Together, we are developing a complementary immunology portfolio that has the potential to deliver better outcomes for patients and significantly bolsters AbbVie's already strong prospects for long-term growth. With that, I'll turn the call back over to Liz. Thanks, Scott. We will now open the call for questions. In the interest of hearing from as many analysts as possible over the remainder of the call, we ask that you please limit your questions to one or two. Operator, first question please. Our first question comes from Chris Schott from JP Morgan. Please go ahead. Hi. Great. Thanks for the quick question, congrats on the deal. I just wanted to dig a little bit more into how much of this deal is based on this initial AD indication versus the potential broader suite of IL-13 indications you could pursue here. Maybe as an adjacent question to that, do you believe you'll be able to get formulary access and dislodge share just with an AD label? Do we need to build out a number of these core Dupixent indications before you get meaningful uptake of the drug, just given the breadth of the Dupie indications and some of the comorbidities we see with these patients? Thank you. Sure. Chris, this is Scott. I'll start with the first question, maybe turn it over to Jeff on your second question regarding access. As I said in my remarks, the majority of the value is associated with zumilokibart. With respect to indication-wise, the bulk of that relates to AD as well. We've not ascribed a certain percentage to it. Obviously, we're going to go through our analysis, you'll see some disclosures on our opening balance sheet when we issue that and the deal closes. The bulk of the sales are associated with both zumilokibart and the AD indication. Yeah. Hi, Chris. It's Jeff Stewart from Commercial. No, we don't believe that we would have to wait until we complete the full construction of, let's say, similar to the Dupixent label. We think that we're going to have quite a differentiated product here. We particularly like the idea of the Dupie plus efficacy. We think we can reproduce that in phase III. Obviously, the best-in-class convenience. You have to remember that at least for the payers, we have a large footprint of other immunological agents that we think that we can carve out the right amount of access here to get off to a fast start. Thanks, Chris. Operator, next question, please. Next, we'll go to Terence Flynn from Morgan Stanley. Please go ahead. Great. Thanks so much. Maybe just to follow up on that question, are you guys considering any head-to-head trials in atopic dermatitis or potentially asthma? Maybe just on asthma, elaborate on the next steps there and the commercial opportunity, as I know that would be a newer area for you guys. What would it take from a commercial standpoint? Thank you. Hi, Terence. It's Roopal. At this stage, we haven't ruled out the need for head-to-head. Although it may not be necessary based on the data that we've seen to date, especially given the dosing interval and convenience and potential impact on adherence, particularly in atopic dermatitis. One consideration is also if you have an installed base of patients that are inadequately controlled, having them switch over to something that's much more convenient, that's an option that could be meaningful and one under consideration. You've seen us conduct such studies with Rinvoq and Skyrizi, and those have been quite impactful and affect day-to-day. Practice patterns. I would say that continues to be an option that we're going to explore. Asthma, as you stated, it's potentially as big or bigger than atopic dermatitis, especially continues to see quite a bit of severe patients. The penetration rates, like in atopic dermatitis, are under 10%, and you have prevalence and growth rates that are exceeding 15%, similar to atopic dermatitis. The opportunity there is large, and these patients are underserved at this stage, and having a combination approach may fulfill that unmet need. Maybe just to add to that, Terence, Its Jeff, is that we had a stated goal during our strategic reviews to enter the asthma and the respiratory market. We have a very significant commercial footprint and to Roopal's point, our ability to think about novel biologics or combination platforms as we look at what we believe is a severely over-indexed market to the inhalers. Look, that makes sense when you don't have maybe the biologic horsepower you have in other areas. We think that that will come, and we want to be on the front end of that. That was a very purposeful aspect to enter asthma with this acquisition. This is Rob. Just to add to Jeff's comments, as I think about the size of the company in the middle part of the next decade, as a management team, we looked at are there new sources of growth in large markets with high unmet need? I've mentioned obesity in the past, and you saw us enter into that with the Amylin opportunity from Gubra. With this opportunity now in asthma is another disease area that we evaluate as, again, large market, high unmet need that can really drive growth for the company over the long term. Thanks, Terence. Operator, next question, please. Next, we'll go to Vamil Divan from Guggenheim. Please go ahead. Great. Thanks for taking my questions. Congratulations on the deal. Maybe two, if I could. One, just on the atopic dermatitis. Maybe you touched on this at the beginning of the call, but just the presence of Rinvoq in that indication and how you think of the overlap between that and now what you're getting from Apogee, and do you have any concerns from an FTC perspective on that overlap there? Maybe if you could just remind us how much of Rinvoq sales actually come from AD, that'd be helpful. Second, just maybe building on those prior comments. I thought it was interesting because you mentioned asthma as a new area that you strategically want to be getting to. I'm just curious about sort of pulmonary in general or respiratory in general, broader than asthma. We've seen a lot of interesting development in that space as you sort of build out that vertical now. Is this a new area we should think about where you may be looking for further business development in the future? Thank you. Hey, Vamil. It's Roopal. With respect to Rinvoq and AD, first of all, atopic dermatitis is a very large market. As we stated, it's growing at over 15% per year. If you think about moderate and severe and compare it to psoriasis, it's about 2.5x larger than psoriasis. There's many assets, and we acknowledge it's quite competitive. However, that being said, we see Rinvoq in second and later lines, and consistent with IBD, where you see Skyrizi a preferred therapy in earlier lines, you see Rinvoq having been able to come in now in second and later lines. That positioning is also observed in psoriatic arthritis. It's also a position that we're developing against in hidradenitis suppurativa with lutikizumab and Rinvoq. Consistent with that, ZUMI here could be in the front line a preferred agent, and for those that are not getting the relief that they need, you have Rinvoq there. I think that creates a very nice opportunity, and you've seen quite a bit of success from us, and I'll let Jeff comment further on that. Yeah, I think, Vamil, to Roopal's point, we don't see a material impact on Rinvoq. In fact, we think it's going to help because our ability to deliver across other therapy areas like PSA or IBD, sort of this one-two punch where you have a biologic and then you have RINVOQ in the later lines has been very successful. We don't see significant interactions. If anything, they're positive. I think it's important to remember as Roopal intimated, that the label in the U.S. is that Rinvoq should be used after systemic exposure, including a biologic. Obviously, strategically, we want that biologic to be ZUMI. All good from this dynamic of the ability of our commercial teams and our sales teams to appropriately co-position the assets based on their data and their labeling. Back to the asthma question and respiratory, we also have plans to go into COPD. There's more than 2.5 million patients there, and also the penetration there for advanced therapy is even lower than what we are observing with atopic dermatitis and asthma. We see opportunities there, and we continue to see consistent overlap with some of these other indications that I mentioned with asthma as well. As it pertains to going beyond, recall we have LPAR assets, biologics and small molecules that just initiated development in idiopathic pulmonary fibrosis. That is several indications in respiratory, and we don't rule out any others because we do agree there continues to be high unmet need in the therapeutic area of respiratory. Okay. Thanks, Vamil. Next question, please. Next, we'll go to Mohit Bansal from Wells Fargo. Please go ahead. Great. Thank you very much for taking my question, congrats on the deal. My question maybe for Roopal here. Just trying to understand what is in this particular IL-13 biology that you think could actually provide differentiated efficacy or maybe a better efficacy than Dupixent, because Dupixent is IL-4 so there is that aspect, which you know, maybe some KOLs are saying that maybe when you do the phase III trial, the efficacy could be more similar than different. In that case, it is a convenience play, would love to understand how you are thinking about biology and how it could be differentiated in terms of biology that results into better efficacy. Thank you. Thanks, Mohit. It's Roopal. That's a good question and something that we've been considering for some time as we've developed our internal pipeline. However, when we look at the data and the amount of ability of Zumi to saturate IL-13, it takes it down to 99%. Then when you look at the phase II data, and there's two parts of that, you see a replication, you see quite high efficacy. In our own internal work, we feel IL-13 is the critical factor in atopic dermatitis. That's why we have an IL-13/31 and an IL-13/18. Also, we have optionality with Apogee's pipeline. They, in fact, have an extended duration IL-4 receptor alpha and in fact, an extended duration IL-31. That creates a lot of options. Now the data, I would say, is most critical. We can talk about preclinical hypotheses, at the end of the day, the data is most important. The Part B, where you saw maybe a little bit better efficacy, was in a broader population, a global population, one that had failures in approximately 20% of the patients of advanced therapy. That would include Dupixent, JAK inhibitors like Rinvoq. That, we believe, is more consistent with what a phase III program would look like. We also have the opportunity during diligence to look at the data, to look at PK and exposure data. We run models, we use machine learning, and we think there's a very strong probability to replicate and continue to see high efficacy. The other notable item is the EASI-100 response that you see with Zumi. We didn't talk much about that. It's in the package that you'll see posted. That is actually quite high, and some of that starts to get close to Rinvoq-like efficacy for EASI-100. It's not going to be exactly there if we did a head-to-head, apples-to-apples comparison, but it's certainly lifting, and it's lifting much higher than what we've observed previously if you're simply blocking IL-4. Mohit, if you think back years ago when IL-12/23s were making their way into psoriasis, there was some thought that you had to take out more cytokines. We even had our own program in IL-12/23, and ultimately, we thought taking down maximally IL-23 was going to be the path forward in psoriasis. I think you've seen that play out with the success of Skyrizi. We're not concerned, and we're very excited to move this into phase III. Thank you, Mohit. Operator, next question, please. Next, we'll go to the line of Michael Yee from UBS. Please go ahead. Thank you. Congrats on the deal. One of the things I know that's been out there in terms of half-life extension programs has been the YTE modifications. Can you remind us and perhaps explain some of the strong diligence you might have done on that and to what extent you got comfortable with these types of product profiles and the outlook ahead and what your assumptions are around IP? Thank you. Hey, Michael. It's Roopal. I'll take that one. You're right. Some of the work has to be in molecular design. We do have a level of comfort. However, you don't always know how the antibody is going to act when in human in disease. That's what's most important. When we look at zumilokibart, we do see an extended half-life in human disease over 70 days. That gives us confidence that whatever molecular design there was hasn't impacted any performance that you would see in the clinic. You couple that with the high efficacy that we discussed, including EASI-100, gives us comfort that we have the option here potentially to go to twice a year and maintain very high levels of efficacy, especially if we match the PK. Some of the data that you've seen that goes to every 24-week dosing in terms of the maintenance of response, that's fairly strong. However, the PK wasn't matched. That was at 360. If we double that dose to match the PK, we have greater confidence in the ability to get to Q24. That further validates that concept of YTE. I believe you have to consider the performance of the whole molecule, where it comes to binding of the critical epitopes and takedown of the cytokine of interest, as well as half-life. We see both of those playing out when we look at part A and part E of the data to date. Maybe just to supplement that from the diligence perspective on the commercial side. Obviously, we have very close connections to the community derms and the thought leaders around the world. Because of the strength of the data, it's phase II data. We can see the part A, we see part B, we can see the consistency and the durability, this opportunity for three to six months of dosing. It was overwhelmingly viewed as a high willingness to prescribe by the community derms. I think it makes a lot of sense because when you think of this group of physicians, it's something that they know, they understand. They know an IL-13. It looks quite a bit better in this phase II work that we believe we can reproduce in phase III. It's quite a bit more convenient. That idea of something I know that's better and more convenient was tied to a very high willingness to prescribe in our commercial diligence. Michael, this is Rob. Your question for the outlook for IP on these assets. We see that well into the 2040s. For ZUMI, the compound patent, we have expiring in 2044, and then for APG273 compound patent in the U.S. expiring in 2047. There's quite a bit of runway for both assets. Thanks, Michael. Operator, next question, please. Next, we'll go to the line of Emily Field from Barclays. Please go ahead. Hi. Thanks for taking my question. I was just curious how you're expecting the commercial landscape in AD to have evolved by the time ZUMI could be launching, given that Ebglyss just had the Q8-week maintenance dosing added to the label, how you're thinking about the potential entry of Dupixent biosimilars and how that could impact ZUMI from a formulary perspective. Thank you. Yeah, thank you. Thanks for the question. I think one of the things that Roopal had mentioned, I believe we've mentioned over time, is that the penetration rate of this market is incredibly low. In some ways, we look at how big Dupixent can be, global sales, and the dynamics around Rinvoq, but this penetration rate is about 8%, which is by far the lowest of any immunological category that we see, and it grows the fastest. One of the key dynamics is this market is going to continue to progress and develop over time. We've highlighted before that you're going to see line of therapy expansion. Even if you had biosimilars and they came in and they took a piece of the front line, there's still this expansion dynamic and basically biologic growth dynamic that is going to be very sustainable. We also looked at the market in a certain way that some of the, let's say, near-term catalysts have dissipated to some degree, which we think gives more opportunity for a knowable product like ZUMI. We think the OX40, for example, are going to run into a lot more trouble. We've seen that. We've seen the discontinuation rate of an early biologic combination with IL-13/31. We think the space is really there in this expansive approach. We also view that we've seen in other biologic markets that the first biosimilar does not necessarily sort of take all the air out of the market, particularly one that is frankly so immature. Net-net, when we view all of the dynamics here in the atopic derm market, this is going to be a market that will continue to evolve over the next decades, and the technologies will continue to improve. We think we have a good one for that early line, and we have a really great one for later lines like Rinvoq. That's how we viewed the market dynamics. Maybe from an innovation standpoint, if you think back on Humira, infliximab, ustekinumab, these have all gone biosimilar over the last several years. When you bring innovation, you still see expansion and as Jeff explained, the opportunity is still there. We think from a development standpoint, because of the low penetration rates and underserved market here, these types of innovations here will be rewarded. Thank you, Emily. Operator, next question, please. Next, we'll go to the line of Jason Gerberry from Bank of America. Please go ahead. Hey, guys. Thanks for taking my question. Just wanted to follow up on Emily's question. Your commentary about being a preferred early line therapy in AD, just wondering how important is it for you to be commercially available on market, either at or even before the availability of biosimilars of Dupixent? In addition to that, I'm just trying to get a sense of your commercial outlook and being a preferred early line therapy. How critical is it to being differentiated on efficacy versus just differentiating on the convenience attribute? Thanks. Yeah, thanks. In general, what we've seen, if you look at analogs and models over time, it is important to basically come out ahead of the emergence of biosimilars. It just aids in payer negotiations and how they may think about their formulary development. One of the most valuable aspects that we looked at, certainly when Humira went in the U.S., is we were able to establish Skyrizi and Rinvoq several years before the emergence of the Humira biosimilars, and you've sort of seen that story play out. That is an important consideration. Look, it's always better to have a notable efficacy advantage versus just a convenience advantage. If you think about the magnitude of the convenience advantage, it's quite significant because we even see, even with Ebglyss, a significant amount have to go from one month down to every other week. Maybe we'd see 30%-35%. This is a substantial change in convenience, but there's no question that a critical part of our phase III development program will be looking at populations to make sure that the biology around the dose, basically the molecule itself, can distinguish itself from the first-generation biologics like Dupixent or Ebglyss. Yes, you always want to have a plus on the efficacy side as your clinical trial and your programs are able to elucidate that. This is Rob. I'll just add that it does depend on the disease area. For, as an example, in the disease area that zumilokibart would participate in, convenience is an important factor. Efficacy and convenience, but convenience can play in a very important role. When you think about in IBD, for example, efficacy will rule the day more so than convenience. You do have to look at the disease area you're participating in to really answer that question. With the IP of 2031 with Dupixent or potentially further out, the way these will be designed is that we'll be launching prior to any of that, if we're thinking early 2030. All right. Thank you, Jason. Operator, next question, please. Next, we'll go to the line of Geoff Meacham from Citi. Please go ahead. Hey, guys. Thanks for taking the question. Congrats on the deal. A lot of my questions have been asked, I wanted to ask you on the dosing. How much of the value or the positioning do you think could be enhanced by moving to even further dosing, say one year, even beyond the six months? Are there indications where that annual dosing makes a little bit more sense and maybe could be a priority as you look to further add new trials to the mix here? Thank you. Hey, Geoff, it's Roopal. There could be a component of patients and individuals that are willing to look at something that could be dosed once a year. Potentially in derm, I would say, where there's strong safety established, if the patient has already experienced strong tolerability. I think out of the gate, it could be a challenge because you just don't know how the patient's going to do. If they don't perform well, the question for a dermatologist could be, "What do I do next if I have an ultra-long half-life?" If you have a strong pharmacodynamic effect that sort of punches above the half-life, that could create some options. We think at quarterly dosing already, that is highly differentiated, and you've seen that performance with Skyrizi. Going to twice a year is quite meaningful because the physicians are going to want to see the patients a couple of times a year. I don't think if it doesn't achieve an annual dosing regimen that harms these in any ways. Occasionally you'd have to be a little bit careful if you go too long. Thanks, Geoff. Operator, next question, please. Next, we'll go to the line of Evan Seigerman from BMO Capital Markets. Please go ahead. Hi, guys. Good morning. Thank you for taking my question. I wanted to touch on your thoughts regarding kind of the evolving competitive landscape, specifically with Regeneron's super-dupy as they've talked about kind of their IL-4, but also their IL-13, IL-4 bispecifics. How does this asset play with these potential investigational assets given that Regeneron and Sanofi kind of own this space? I know you want to make inroads. I'd love to hear your thinking as you had evaluated this asset in making the decision to acquire. Hey, Evan, it's Roopal. We think that Zumi can be quite competitive, and you can see the data already. It's posted. It's very strong, and we think we have a high probability of replicating this in phase III and expanding out to other indications. It's very important to look at these convenience profiles of this asset. I think that really sets up a strong competitive play. I would say going forward, we're not done. Remember, there's Rinvoq there as well, and as we've discussed in IBD and even in rheumatology, lines of therapy are going to continue to expand, and the market itself is growing. It's very dynamic. It's growing over 15%. Penetration rates are under 10%, so it's a very large market. Rinvoq is still there. There's a synergy when you have two of these assets. We've seen that play out in psoriatic arthritis. You've seen it play out in IBD. Hopefully, we'll see that play out in HS in the future. Recall, with this acquisition, we also pick up a half-life extended IL-31, also an IL-4 in our own pipeline, two bispecifics, IL-13/31 and IL-13/18. There's quite a bit more beyond where we're talking, but obviously the lead asset is Zumi. I would say quite a bit more behind that, given the scale of this market. Thank you, Evan. Operator, next question, please. Next, we'll go to the line of David Amsellem from Piper Sandler. Please go ahead. Thanks. Had a question on TSLP, in particular, and sorry if I missed this in your prepared comments, but are you thinking about the TSLP only as commercially viable, given that there is less dosing frequency than tezepelumab? Or are you specifically wedded to the IL-13 TSLP-directed therapy combination? I guess that question applies to both asthma, as well as COPD. Just wondering how broadly you're thinking about that as you think about TSLP only versus IL-13 plus TSLP. Thanks. Hey, David, it's Roopal. Some context for our thinking, I'll refer back to inflammatory bowel disease, where we had a very strong asset with Skyrizi, we felt combining with that could drive higher levels of efficacy. We've outlined an alpha-4 beta-7, TL1A, and potentially TREM-1. What we did there was look at the two monotherapeutics along with the combination and look at exposure response, our goal there is to optimize that therapy. I would say you can consider that work and that's what we would apply to IL-13 and TSLP. Both are half-life extended, going forward, we'd want to look at them in parallel and in combination and see where it takes us. We believe the combo could be the best approach, especially targeting TH2 high and low, driving that convenience. Also from a clinical standpoint, do you have to always check eosinophil levels? You may not if you can get the combo and work in all comers. That's a layer of convenience in and of itself before we start talking about enhancing adherence, going to quarterly dosing or twice a year. It'll be a data-driven approach, very consistent with the pattern that we're following in IBD. Thank you, David. Operator, next question, please. Next, we'll go to David Risinger from Leerink Partners. Please go ahead. Thanks very much. Let me add my congrats as well on the transaction. I just wanted to clarify a few things, please. First, could you comment again on the anticipated timing of product launches? I think, Roopal, maybe it was you that had mentioned early 2030 for product launches, but just wanted to clarify that. Separately, regarding the leverage, could you define how you calculate leverage and restate, I think you said you target a net leverage. I believe that's how you're talking about it in two to three years of 2x, but more clarification on that would be great. Thanks very much. Sure. This is Scott. I'll start. Actually, I'll take both of them. You're correct with respect to the launch of zumilokibart, early 2030 is what we anticipate. With respect to net leverage, that's our net leverage. We define it as net debt to EBITDA. I would note that EBITDA does not include IPR&D charges, just for clarity. When we talk about, we've actually have indicated we'd be below 2x at the end of this year. We've talked about we will have a path back after the borrowing for this transaction to, again, below 2x within the two to three-year time period. I think that's pretty standard with how we've talked about managing our overall leverage and the strength of our balance sheet. Our balance sheet remains very strong even after the borrowing for this transaction. David, just a real quick comment. Our target is 2030 early. We'll kick off these phase III this year. Every opportunity the team can have to pull these in into the earlier part of 2030 or even before, obviously, these are levers that we're all going to pull together. Thank you, David. Operator, next question, please. Next, we'll go to the line of Gary Nachman from Canaccord Genuity. Please go ahead. Hey, everyone. Good morning. This is Denis Reznik on for Gary Nachman. Congrats on the deal, and thanks for taking our question. Just as it relates to the phase III atopic derm trial, which is starting the second half, can you just talk a little bit more about the size and the scope of the trial and what you need to do from a phase III design standpoint to replicate the phase II success? Then would you have any ability to influence that trial before it kicks off? Thanks so much. Hey, Dennis, it's Roopal. Well, we will partner and influence to the extent that we're allowed. Yes, we have experience here already with multiple phase IIIs with Rinvoq. Which were very successful, not guaranteed, with Rinvoq, we probably saw better efficacy in phase III than we did in phase II. We have confidence in our abilities, and we have confidence in the Apogee team for sure. Why I say that is because Part B was much more consistent with what a global trial would look like, especially if we're trying to balance the right patients, the right sites, the right countries with speed. The Part B data are reflective of that and look quite strong. When we go further, as I stated before, using the exposure response data, machine learning, and looking at baseline demographics, I think the predictors that we are seeing are very consistent with what was utilized in Part B. Replicating that, I don't think should be a major problem. We'll be focused on that and partnering to the extent that is allowable. Thank you, Dennis. Operator, next question, please. Next, we'll go to the line of Louise Chen from Scotiabank. Please go ahead. Hi. Congrats on the deal. Thanks for taking my question here. I wanted to ask you if you could provide more color behind your 2032 accretion assumption and this mega blockbuster sales potential. Maybe if you could give us a little bit more thoughts on sales, margins, market share penetration. Thank you. You're correct. We've talked about being accretive in 2032. Now recall that, as Roopal just indicated earlier, and I as well, the sales we anticipate to begin after the approval in at least early 2030. You're going to see positive operating margin in 2031, and then deal actually accretive from an EPS perspective in 2032. We've not sized the sales number other than to say the mega blockbuster status that we spoke about earlier in our prepared remarks. You can anticipate, and there's plenty of analogs out there from even recent launches, a fairly steady and important ramp as we launch the product in 2030. Louise, this is Rob. I'll just add, as we think about this acquisition, we're thinking about long-term growth beyond Skyrizi and Rinvoq. We would expect that what Apogee gives us is significant. We say mega blockbusters, peak sales potential. These are significant assets that can really help drive growth for the company beyond Skyrizi and Rinvoq. Thanks, Louise. Operator, next question, please. Next, we'll go to the line of Steve Scala from TD Cowen. Please go ahead. Thank you very much. I have two follow-ups, including on the question just asked. Rob, when you say mega blockbuster, I assume that you're implying something north of $20 billion +. Is that correct? Secondly, I'd like to follow up on an earlier question. In addition to new molecules, Sanofi has spoken to high-dose Dupixent and Dupixent combinations. Should we assume that AbbVie has considered these carefully and has concluded that they don't offer much? Is that the conclusion we should derive? Thank you. Steve, this is Rob. Our definition of mega blockbuster would be north of $10 billion. Yeah. On the competition, yes, we've looked at existing competition, new competition. I wouldn't say they don't offer much. I would say it's a very, very large, under-penetrated, growing market amongst the largest in the class in immunology. We feel with this asset, it can be highly competitive. We also believe with the pipeline that will emerge from Apogee coupled with AbbVie's pipeline, it'll allow us to be competitive in this dynamic space for many, many years to come. All right. Thank you, Steve. We have time for one final question. For our final question, we'll go to the line of Matt Phipps from William Blair. Please go ahead. Thanks for taking my questions. Congrats on the deal. Roopal, you touched on this a little bit, but some physician conversations lately have had concerns about the washout time for these YTE antibodies for a patient that does develop a side effect, such as perhaps conjunctivitis here. How do you manage that in your development plan? Do you have any concerns on potentially higher rates of conjunctivitis given deeper and longer coverage of inhibiting IL-13? Thank you. Thanks, Matt. In terms of conjunctivitis, that was something that we wanted to look at during diligence as well. What we observed is rates consistent with other therapies. Remember, these patients have a higher rate at baseline to begin with. I thought the team at Apogee did a very nice job of characterizing this and really trying to assess it over time and after a diagnosis was made. What we observed there was around a duration of approximately a month or so. That compares very favorably with other assets in the space where the duration of conjunctivitis lasts much, much longer. Given the long half-life and short duration, we think the physicians and us with guidance are very well-positioned to manage. Also, the key for adverse events is what results next. The discontinuation rate is actually very, very low. Overall trials all under single digits and due to conjunctivitis, less than 1%. Even with a 70+ day half-life, these adverse events resolve and largely resolve with eye drops and moisturizing eye drops. No concerns there. Deep diligence. Apogee's done a good job. We're very familiar with this along with our eye care team, and we think we'll be able to manage this very well and manage these concerns and still allowing this very nice dosing profile that we see. Thanks, Matt. That concludes today's conference call. If you'd like to listen to a replay of the call, please visit our website at investors.abbvie.com. Thanks again for joining us. Thank you all for joining the AbbVie Investor and Analyst Conference Call. That concludes today's conference. Please disconnect at this time, and we hope you have a wonderful rest of your day.