Good morning and good afternoon, and welcome to the conference call and live webcast. Novartis agrees to acquire Avidity Biosciences. Please note that during the presentation, all participants will be in a listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions by pressing star one, one at any time during the conference. Please limit yourself to one question and return to the queue for any follow-ups. A recording of the conference call, including the Q&A session, will be available on our website shortly after the call ends. With that, I would like to hand over to Ms. Sloan Simpson, Head of Investor Relations. Please go ahead, madam. Thank you, Heidi. Good morning and good afternoon, everyone, and welcome to our conference call on the proposed acquisition of Avidity. The information presented today contains forward-looking statements that involve known and unknown risks, uncertainties, and other factors. These may cause actual results to be materially different from any future results, performance, or achievements expressed or implied by such statements. Please refer to the company's Form 20-F on file with the U.S. Securities and Exchange Commission for a description of some of these factors. The discussion today is not the solicitation of a proxy nor an offer of any kind with respect to the securities of Avidity Biosciences or SpinCo. The parties intend to file relevant documents with the U.S. SEC, including a proxy statement for the transactions and a registration statement for the spin-off. We urge you to read these materials that contain important information when they become available. Before we get started, I also want to remind our analysts to please limit yourselves to one question at a time, and we'll cycle through the queue as often as we need to. We're also not taking questions on Q3 earnings or other clinical trials on this call. With that, I'll hand across to Vas. Great. Thank you, Sloan, and thank you, everybody, for joining today's conference call. We're very excited to go over with you the proposed acquisition of Avidity Biosciences, which we think is a strong strategic fit for the company, builds our presence in neuromuscular diseases, builds our RNA technology platform, and materially improves the medium and long-term growth profile of Novartis. Moving to slide four, I wanted to give you first an overview of the transaction. Novartis proposes to acquire all outstanding shares of Avidity for $72 per share. This represents a 46% premium to the October 24th closing price. Avidity will separate its early-stage precision cardiology programs into a new SpinCo, including the relevant third-party agreements. Novartis will acquire the neuromuscular franchise, follow-on compounds, platform rights, and we do expect a closing in the first half of 2026, subject to the completion of the SpinCo and the usual customary closing conditions. Through this acquisition, we'll acquire three late-stage assets, which I'll go through in turn, a preclinical neuromuscular pipeline, and importantly, a platform for extrahepatic delivery of xRNAs, an area that's, as you know, a high interest to Novartis as one of the leaders in delivering xRNAs for cardiology-related indications to the liver. This will give us the capability to deliver these technologies outside of the liver in the future. Now, moving to slide six, I wanted to start with the strategic rationale for the deal in a little bit more detail. We've articulated to you we want to do deals in our core therapeutic areas and our core technology platforms, and this is a deal that fits both. We strengthen our neuroscience franchise by adding three late-stage neuromuscular programs, and this builds on the extensive experience we have with Zolgensma. It really complements the footprint that we have with Zolgensma, and I'll go through that in a bit more detail later in the presentation. It advances the xRNA strategy that we began by acquiring The Medicines Company and now have built over the last years with a broad portfolio of RNA therapeutics targeting a range of cardiovascular targets. This now adds a unique platform for Antibody Oligonucleotide Conjugates, enabling us to deliver RNA to the muscle. It also adds a first-in-disease pipeline, and we want to be in these areas where there are high unmet needs and a need for disease-modifying therapies. Del-desiran and Del-brax have the potential to be meaningful disease-modifying therapies for DM1 and FSHD. As I noted, this enhances our growth profile, and I'll go through that in a bit more detail. I already want to highlight that these are medicines without LOEs before at least 2042 and are IRA exempt. From a sales profile and return profile standpoint, unlock multiple near-term multibillion-dollar opportunities with three programs expected to launch before 2030. Now, moving to slide seven, this transaction is also in line with the capital allocation priorities of the company. We've been consistent in saying we want to invest in our core business. We want to do value-creating bolt-ons like the Avidity acquisition. We want to consistently grow our dividend, which we remain absolutely committed to, and of course, ongoing share buybacks with excess capital. We have an ongoing $10 billion buyback that we expect to complete by the end of 2027. Over the years, we have done value-creating bolt-ons in neuroscience to build out our capability in a range of areas, including, as you see here, these deals, but including areas in neuromuscular conditions, including DTX Kate Therapeutics, amongst others. This really complements the efforts that we've had over the recent years. It strengthens Kate Therapeutics area. It's a best-in-class profile, and as I noted, the attractive sales and financial profile. Now, moving to slide eight, and just to say a bit more about the impact that we expect Avidity Biosciences could have on Novartis, it raises our 2024- 2029 CAGR from + 5% to + 6%. Even more importantly, in my mind, it adds multiple assets that can drive significant growth through the next decade. It adds to the portfolio of late-stage assets that we'll be talking about in our needs-to-management event in a few weeks, adding these additional large-scale assets which can bolster that growth profile 2030 and beyond. As I noted, these are assets that have that outlook into the 2040s without exposure to IRA. We did note in the release we will have a few points of margin dilution to 1%- 2%, we expect, and we expect to get back to our 40%+ core margin in 2029 with efforts to, of course, as always, to get there sooner and continue our strong productivity efforts in the company. Lastly, I do want to note that this is a deal that we believe clearly exceeds our internal rate of return threshold, has clear value creation potential, and will deliver, we hope, substantial returns to our shareholders over time. Now, moving to slide 10, I want to take a moment to go into the core value drivers. Let's start with the technology platform. Avidity brings a pioneering AOCs platform for RNA therapeutics, in particular with the ability to deliver RNAs to the muscle. This platform consists of monoclonal antibodies that target specific receptors on the target tissue. Those monoclonal antibodies are combined with an oligonucleotide to create the AOC conjugate. This gives you the ability to target these RNA therapeutics to cells beyond the liver where normally RNA therapeutics track. It gives you flexibility to deploy either siRNAs or oligonucleotides of different structures to the relevant tissue. We believe that the technology can give you this capability to maximize therapeutic durability, as well as infrequent dosing, and it's reproducible and scalable. Moving to slide 11, over the next few slides, I want to take each of the three assets in turn. This page hopefully is helpful to you in that it covers a lot of the key data that I'll be covering in more detail, giving you the patient populations, our base case timeline, and the mechanism of action. Let's dive into each one separately. Starting on slide 12 DM1, Myotonic Dystrophy Type 1, this is a rare progressive neuromuscular disorder with a poor prognosis, no disease-modifying therapy, but with a relatively large patient population with an estimated 80,000 patients in the U.S. and the EU combined. There are no currently approved disease-modifying therapies for this condition. It's an under-recognized disease, so the prevalence may ultimately be higher than what we currently model. It's progressive and often fatal. It primarily affects skeletal, cardiac, and smooth muscles. It is autosomal dominant and increases in severity from generation to generation. There's a significant impact on quality of life. Some of the quality of life measures and things we look at in this disease are muscle weakness and wasting, myotonia. This can be cardiopulmonary comorbidities. Importantly, there is a reduced lifespan in these patients. The current standard of care primarily consists of supportive care, physical and pharmacological symptom management, and, as I said, no disease-modifying therapies. Del-desiran is designed to address the root cause of DM1, and I'll go through that in a bit more detail. This is a medicine that's well recognized by regulators. It has FDA orphan drug designation, it has Fast Track designation, and it has breakthrough therapy designation. It also has, in Europe, orphan drug designation. Moving to slide 13, del-desiran, as I noted, is addressing the underlying cause of DM1. DM1 is caused by trinucleotide repeats, CTG repeats, that expand within the DMPK gene. These expansions change the mRNA structure such that mRNAs sequester splicing factors, including another splicing factor importantly called MBNL. This leads to loss of normal cell function and muscle wastage. The goal here is to restore normal MBNL function. Del-desiran does that by degrading these DMPK mRNA aberrant transcripts in muscle cells and restoring normal MBNL function and splicing. The way this was studied in the clinic was in the Phase 1/2 MARINA study. The trial showed that the medicine is delivered to muscle, engages the target, and restores splicing. In the study, there were a number of endpoints which were also used in the Phase 3 program that's ongoing to assess myotonia, the video hand opening time, to assess strength, hand grip, and quantitative muscle testing, and to look at activities of daily living, a patient-reported outcome measure called DM1 active. Now, moving to slide 14, in the Phase 1/2 MARINA study, del-desiran demonstrated the potential to be a transformational therapy in these patients with really meaningful improvements in all four measures. In the study, the comparison was to the natural history for these patients, but the video hand opening time, you can see, was significantly improved versus a natural history. The QMT composite and hand grip were also significantly improved. From a patient-reported outcome study, there was very positive feedback from patients who were in the trial. In total, in this Phase 2 study, efficacy endpoints were met. There was a reversal of disease progression compared to the natural history data, durable improvements in multiple functional endpoints over one year of follow-up, improvements across the domains that are relevant for the disease, and also significant DMPK knockdown, which is not shown here on the study. Overall, there was also a favorable safety profile. There were 37 patients enrolled that remain on the study, and all related AEs were mild or moderate. The most common related AEs was nausea, and there was no study drug-related treatment discontinuation or serious adverse events. Moving to slide 15, the Phase 3 HARBOR study really tries to replicate the Phase 2 study that I just went over. It's a global pivotal trial with FDA, EMA, and other regulatory authorities' endorsement. It completed enrollment already in July of 2025. The participants are currently eligible to roll over into an open-label extension study, and it has 40 global sites. The endpoints you can see here on the clinical endpoints are aligned with what we used, what was done in the Phase 2 study. Overall, the study is a 54-week study with 159 patients randomized to placebo or the active group. You can see here the population is targeting patients who are over 16 years old and with a significant number of repeats, over 100 repeats in the gene. We expect the 54-week readout in the second half of 2026 and global regulatory submission in 2027. There is an earlier look at the study in week 30. We'll certainly evaluate that, but our base case remains a submission in 2027. I think it's important to understand the study well because this is a key differentiator, we believe, of Avidity versus competitors. This is the only fully enrolled Phase 3 study that will generate randomized placebo control data. It's the only study that has participants from around the world, including the United States, and we think can generate a compelling data package that can be used with regulators, health authorities, and payers. Now, moving to slide 16, now turning to the second disease in the portfolio, FSHD. This is a rare hereditary disorder causing relentless loss of muscle in certain parts of the body, as designated in the actual name of the disease, Facioscapulohumeral Muscular Dystrophy. It is estimated to be somewhere between 45,000 and 87,000 patients, but as with DM1, I think there will be better understanding of the number of patients as therapies become available. No currently approved therapies. It's one of the most common forms of muscular dystrophy, causing, again, the progressive muscle weakness, pain, and fatigue. The onset typically occurs in the teenage or adult years, but what happens with these patients is there's a steady loss of independence, and 20% of these patients ultimately become wheelchair-bound. This particular disease is caused by aberrant expression of a gene called DUX4, which leads to cell death, immune response, and oxidative stress. It is an autosomal dominant disorder potentially affecting multiple generations. 20%- 30% of cases also arise from spontaneous mutations affecting the DUX4 gene. Del-brax is designed to address this root cause of FSHD, and it's the only asset to demonstrate disease-modifying potential in a Phase 2 study. Del-brax has orphan drug designation, Fast Track designation, and EMA orphan drug designation. Now, moving to slide 17, in the Phase 1/2 FORTITUDE study, Del-brax improved mobility, strength, and upper limb function compared to patients that were treated with placebo. You can see here in the four graphs at 12 months with q13 week dosing. You can see the improvement in the 10-minute walk test, also improvements in other functional measures as well, including the RWS, which is the reachable workspace test, and the timed up-and-go test, which again is a measure of mobility in these patients, as well as in the QMT test, which is a composite endpoint. Overall, the study met its efficacy endpoints with improved mobility and muscle strength, consistent improvement in quality of life as measured by patient-reported outcomes. From a pharmacodynamic standpoint, rapid and significant reductions in the levels of cDUX, which is a marker of DUX4, and creatine kinase, which is a key marker of muscle damage. From a safety and tolerability standpoint, all participants remain on study, no discontinuation, and mostly mild and moderate adverse events. Now, moving to slide 18, overall, this compelling data could support cDUX as a biomarker for an accelerated approval, though as I'll go through, our base case remains a finding with Phase 3 data. cDUX is a direct target of DUX4, and it's elevated six to nine-fold in people living with FSHD. Elevated cDUX levels are also linked to worsening disease and muscle weakness. Significant and rapid reductions in cDUX, like we saw in the study, and creatine kinase in these participants were seen following treatment with Del-brax. With that, we saw, as you saw, the improved functional mobility and muscle strength. Right now, there is a biomarker cohort ongoing for the FORTITUDE study to better understand the reductions in cDUX. The FDA has confirmed the potential for an accelerated approval based on demonstrating that reduction in cDUX combined with the clinical data, which I went through in the earlier slide. That data is expected in the second quarter of 2026. Our base case remains filing with Phase 3 data, which I'll go through in a moment, but we'll certainly be looking at that biomarker cohort to see if there is a potential for an accelerated approval. Now, moving to slide 19, the Phase 3 FORTITUDE study of Del-brax in FSHD is already enrolling. It's intended to serve as a confirmatory study for full approval. Participants are across 45 sites in North America, Europe, and Japan. The registrational endpoints, you can see here, are in line with what we saw earlier for the Phase 2 study. In addition, there are signs and symptoms of FSHD, as well as specific endpoints around the cDUX and creatine kinase biomarkers. It's a 200-patient randomized study. You can see here at q6 weeks, 2 mg/kg versus placebo. As I noted, our Phase 3 readout and global regulatory submission under a standard filing path is expected in 2028. Now, moving to slide 20, the third asset amongst the late-stage portfolio for Avidity Biosciences is in DMD, and a certain subgroup within DMD. You all likely well know that DMD is a severe early-onset disease marked by progressive muscle damage and reduced life expectancy. There's an estimated 10,000- 15,000 patients with DMD. This is a monogenic X-linked recessive condition leading to progressive muscle damage and weakness. Symptoms can occur very early on in life by four years of age and, sadly, leading to loss of ambulation for these teenage, often teenage boys, with significant reductions in life expectancy caused by the mutations in the DMD gene, which encodes dystrophin protein. You're trying to restore proper dystrophin protein in these patients. 6%- 7% of patients have mutations to exon 44 skipping, DMD44, and that's what we're targeting here. Del-zota is designed specifically to skip exon 44 of the dystrophin gene and produce functional full-length dystrophin and restore the function of this protein. Del-zota has orphan drug designation, Fast Track designation, breakthrough therapy, and rare pediatric designations, as well as EMA orphan drug designation. Now, moving to slide 21, the Phase 1/2 EXPLORE44 registrational study of Del-zota showed improvements across key biomarker endpoints. You can see on the left-hand side, I think from an expert community perspective, remarkable increases in the dystrophin protein, as well as striking reductions in creatine kinase. I think this is viewed as, in my mind, a very strong proof of principle of the overall platform, but importantly, also an important therapy for this group of patients. There was a 40% increase in the exon skipping across the dose score and a 25% increase in dystrophin production. As I noted, an 80% reduction in CK levels and clinically meaningful improvements across functional endpoints with a favorable safety and tolerability profile. This is a program that's on track for FDA submission for accelerated approval in 2026. Also, I think an important part of this acquisition. Moving to slide 22, one of the most important things to note from a commercial standpoint and why I believe we can drive rapid uptake of these medicines is it's aligned with our commercial capabilities in the neuromuscular experience we've built up since the launch of Zolgensma. We have a deep understanding of patient journeys in rare diseases, in areas like spinal muscular atrophy, as well as diseases like PNH and C3G. We've built up patient identification and activation capabilities. We have strong payer engagement capacity as well. Our field structure is ready to deploy across neuromuscular indications. I'll come back to that in a moment. We also have built up scalable support programs as we've gone through the launches of medicines such as Zolgensma, Fabhalta, Vendrastias, Temlik, and also Ilaris before this. When you think of our coverage of diagnosing neurologists, we see here already with the first launch in DMD, a 90% overlap. Already with FSHD and DM1, 60% and 40% overlaps of the primary prescribing physicians, which we believe will allow us to have a relatively small scale-up to be able to fully cover the physicians in question in FSHD and DM1, and we're absolutely prepared to do that. Taken together, Avidity is highly synergistic with our commercial footprint in the rare neuromuscular space and in rare diseases generally. Now, moving to slide 23, we also wanted to give you a perspective on external forecasts. You can see here the Min, Median, and MAC. At this point, we would just highlight that both the assets in DM1 and FSHD have multibillion-dollar potential and certainly, we think, very sizable potential given the size of the patient population and our expertise in launching these medicines. As I already noted, you do not have LOEs for either medicine before the early 2040s at the earliest, and neither medicine is currently or expected to be subject to IRA. Moving to slide 25, in closing, and just to give you a summary, transaction, I think, hopefully, is clear: $72 per share. The total transaction value is estimated to be $12 billion on a fully diluted basis, representing an enterprise value of $11 billion at the expected closing date. We expect to close in the first half of 2026, subject to the separation of the SpinCo and other closing conditions. We believe this deal will bring substantial value to the company with multiple multibillion-dollar peak sales opportunities, near-term launches, and exclusive rights to an exciting RNA platform outside of cardiology. This enables us to raise our near-term sales guidance from +5% to +6%, but importantly, perhaps even more importantly, bolsters our growth profile 2030 and beyond. It does involve short-term dilution of 1%- 2%, but we expect to get back to the 40%+ core margin in 2029 with an aspiration to get there sooner. We expect an IRR to well connect us to our cost of capital with significant value creation if the assets are successful. Lastly, this fits with our capital allocation priorities. No change to our capital allocation strategy overall. Taken together, we think an attractive opportunity for Novartis, our shareholders, and most importantly, for the patients that these therapies can treat. With that, let me open it up for questions. Thank you. Oh, maybe before I open it up for Q&A, just to mention on the call with me, we have a number of folks. We have Harry Kirsch, of course, our CFO. Alongside that, we have Shreeram Aradhye, our Global Head of Development. We also have Dr. Norman Putzki, who is our Head of Neuroscience Development and a neurologist, and Dr. Bob Baloh, our Head of Research in Neuroscience and Neuroscience in our Biomedical Research group, and really one of the global thought leaders in muscular diseases such as the ones we talk about here. With that, we can open the line for questions. Thank you. As a reminder, to ask a question, you will need to press star one, one on your telephone and wait for your name to be announced. To withdraw your question, please press star one, one again. We will take our first question. The first question comes from the line of Sachin Jain from Bank of America. Please go ahead. Your line is open. Hi there. Thanks for taking my questions. A question on accelerated pathways, which you touched on, Vas, but maybe you could just detail a little bit more. In FSHD, I think Avidity had almost framed the accelerated as base case. Just trying to understand your reasons for greater caution. You referenced you'd wait and see the biomarker data. Do you have a specific benchmark agreed with the FDA as to what needs to be seen? A similar question for DM1. Again, you slightly referenced it, but competitor Dyne has talked to accelerated pathway. Your perspective on that and your competitor profile should they get to the market slightly ahead of you? Is it just a larger global study, or is there anything else in the clinical profile? Thank you. Yeah, thanks, Sachin. I think first on the accelerated pathway, we certainly think the company, Avidity, has had very robust discussions with FDA. It's just our general experience to always assume full clinical data sets are required for approval. That's our base case assumption. Certainly, if the cDUX reductions are significant, there's a very good reason, given the high unmet need, to approach FDA and see if there's a pathway forward for accelerated approval. No concern, but we want to take a pragmatic, thoughtful, conservative approach to how we think about the filing timelines. On DM1, it's really important here to note the importance, we believe, of placebo-controlled data and having a full Phase 3 program that involves U.S. patients, which is something that we think Avidity has done very well—a fully enrolled Phase 3 study, placebo-controlled data set. Certainly, we will look as well at the 30-week endpoint. There is an opportunity to have an interim read, and if we see that, that would enable faster filing. We think what will enable differentiation is the robust data set, and that will enable us to launch to both regulators, payers, and physicians with a compelling data set that we think will enable a rapid uptake. I think both medicines, of course, are very good at achieving the desired goals of symptom improvement and biomarker impact. I also would say these are large enough indications that there can be multiple competitors. Our goal, of course, is to be the market leader in each one of these three diseases, and that's what we'll be able to do. Thank you. Next question marker. Thank you. Please stand by. Your next question comes from the line of Kirsty Ross-Stewart from BNP Paribas. Same, please go ahead. Your line is open. Hi there. Yeah, it's Kirsty Ross-Stewart from BNP Paribas on behalf of Peter. Just on the kind of revised midterm guidance, I think it's implying a kind of $2 billion- $3 billion revenue contribution from the Avidity acquisition in 2029, and that's kind of ahead of current Avidity consensus. Just a bit of clarity on what's driving your high conviction here. Is it kind of pricing leverage that you can bring commercially, patient identification, breadth of reimbursement, or something else? Thanks very much. Maybe just generally, first, I'll get ahead of Harry on the guidance area. Yeah, so overall, of course, as you mentioned, right, a 1% five-year CAGR on the business of OSI is roughly $3 billion. We don't expect in 2029 $3 billion from these assets. Roughly half, I would say, of that is due to these assets, and then overall the portfolio is overperforming. That's contributing the other half. These are large ranges, but it also should not distract. The most important here is the contribution as of 2030, well into the early 2040s, to further bolstering our long-term outlook. We just thought we'd update the five-year as this comes in handy as we looked at our five-year anyway being a bit stronger, and then these assets expected to further contribute. Maybe, Kirsty, to the second part of your question, we do believe that our ability to drive uptake, given our commercial profile, we do believe that we can drive substantial uptake with these medicines, given the expertise that we have in neuromuscular diseases, the established footprint and relationships that we have. Of course, we'll provide appropriate peak sales guidance as we launch these medicines and we're further along. Next question, operator. Thank you. Your next question comes from the line of Harry Sephton from UBS. Please go ahead. Your line is open. Brilliant. Thanks very much for taking my questions. I'd just like to get your thoughts on the structure of the deal with the spin-off company and why the precision cardiology programs weren't directly included as part of the deal, and whether you see any potential use of this technology for future implications and the platform value from the deal. Thank you. Absolutely. I'll hand the platform potential to Bob Baloh in a moment. First, on the structure of the deal, given the third-party agreements that Avidity has, we thought it would be the simplest and most straightforward structure to create a SpinCo that can enable those third-party agreements to be serviced. We'd rather focus on the neuromuscular portfolio and related assets as well, as well as leveraging the technology platform in the future. Maybe, Bob, if you want to cover as well the potential of the technology platform. Sure. You know we're clearly very interested in utilizing CFR delivered to different tissues, including brain and muscle, and we found that Avidity has done an incredible job in tuning the ability of these different shuttles to target different tissues over time. This one is clearly targeted to muscle, and it does an effective job for skeletal and cardiac muscle. They have further generations of that technology to bring as next generation therapies to these diseases. We think it can be more broadly used, but really the focus for this first generation is in these key lead diseases where we've seen such an effective delivery of the agent to the muscle and hitting targets. Great. Thank you, Bob. Next question, operator. Thank you. Please stand by. Your next question comes from the line of Seamus Fernandez from Guggenheim. Please go ahead. Your line is open. Oh, thanks very much. Vasant, I was just hoping you might be able to walk us through a little bit of the timing around when we'll have clear validation of the siRNA platform from your perspective. That does seem like a major potential value-add opportunity here. Just wanted to kind of get your sense along those lines. It was our impression that sort of first half of next year was really going to be the major sort of stepping-off point for Avidity in this context. Separately, you know in terms of spin-off, is this really just being executed from the perspective of overlapping assets and to protect from FTC-related delays or issues in that regard? If so, if you wouldn't mind just highlighting to us some of those overlapping assets where you are advancing your own precision cardiology programs. Thanks so much. Yeah, thanks, Seamus. First off, from a de-risking standpoint, certainly, you know there'll be important readouts next year, but in our mind, the platform itself has been de-risked with the DMD data set and that now FDA has aligned with the company satisfactory for filing. I think it's important to know while that is a smaller indication, that is a huge validation that the company has successfully delivered on the promise of delivering the RNA therapeutics with antibodies to muscle, having significant therapeutic effect, and building a package that can ultimately be filed. Maybe before I get to the SpinCo, Bob, do you want to just say a few words about why you think the DMD was such an important de-risking event for the technology? Yeah, absolutely. I mean, I think, as you can see in the slide that was presented and really in the reaction from the community, the degree of dystrophin restoration, as well as the normalization essentially of the CK levels that were observed, is something that hasn't been seen before in exon skipping therapies for Duchenne, and it really opens up the possibility that while earlier generations of these have not really met the unmet need for these patients, it may have simply been the lack of ability to deliver the medicine effectively to muscle, and that's why we really think that this and potentially future exon skipping therapies using this platform could be highly effective for these patients. Thanks, Bob. The SpinCo has nothing to do with FTC concerns. The company has research collaboration agreements with third parties, which we simply think would be better served by a SpinCo than Novartis executing research collaboration agreements. That's the primary driver. There's no other concerns with respect to FTC for the SpinCo. Next question, operator. Thank you. Your next question comes from the line of Richard Vosser from JP Morgan. Please go ahead. Your line is open. Hi, thanks for taking my question. Just a question on the hypersensitivity that was mentioned on the slide for the Del-zota product in a few patients. I think Avidity might have suggested that it was related to the antibody when they looked into it. I just wanted to understand your thoughts around that and what data you've seen that suggests this is an isolated incident. Thanks very much. Maybe I'll turn it over to Norman Putzki, our Head of Neuroscience Development. Norman, on the hypersensitivity product. Yeah, thank you, Vas. I think we're looking at a probably generic concern when you use a modality like that. It's still fairly novel, so some inherent risk there. Generally, the overall AE profile was very favorable, and we have only seen moderate side effects. I think hypersensitivity is one of the things that you will be looking out for, but so far, we haven't had any concerns with the continuation of treatment, and we haven't seen any severe effects to that end. With the experience in the clinic, we have more than 100 patients dosed in the Avidity program, some for up to three years at 4 mg/kg. I think overall a fairly mature safety profile in the program. Brilliant. Thank you. Thank you, Norman. Thank you, Richard. Next question, operator. Thank you. Your next question comes from the line of Florent Cespedes from Bernstein. Please go ahead. Your line is open. Good afternoon. Thank you very much for taking my question. Question for Harry, please. Could you maybe generate some cost synergies when you will merge with this company as you have some overlap on some rare diseases? Is the 1%- 2% potential negative impact something that takes some potential savings from this merger? Thank you. Yeah, thank you for your question. I mean, as you know, usually both on biotech companies, you know the cost synergies are limited. It is more important that we have synergies on the commercial side, on the medical, on the R&D side, and in terms of driving dropline and pipeline execution. Now, the 1 to 2 points over the next three years is mainly due to it's quite a we have quite some expensive Phase 3s ongoing. Initially, before we take over the production of the product, the clinical trial material is quite expensive. That's why this has a bit of an unusually high R&D cost impact for the next two to three years. As Vas said, we always look for productivity anyway, and we will see if we can come back to the 40%, which we will basically achieve this year, maybe even befo4re 2029. It's a worthwhile investment given the expected huge returns and sales uptake in the 2030s. Thank you for your question. Thank you. Thank you. Your next question comes from the line of Rajesh Kumar from HSBC. Please go ahead. Your line is open. Hi there. Thanks for taking my questions. The first one is, after this deal, can you just ballpark give us an idea of how much more firepower you've got for dealmaking, and if the size of this deal is a template for deals going forward or if this was an exceptional opportunity and that's why you deviated away from your standard bolt-on model? The second one is just on the readouts in 2026. Can you give us a clear definition of what you would consider as success in terms of outcomes, or if it can't be quantitative, just a qualitative idea of what are we looking for when we see the readouts? We can evaluate them, whether it has met your expectations or not. Thank you. Great. Thank you. Thank you, Rajesh. First on firepower here. Yeah, Rajesh. I would still consider this to be a bolt-on for a company of our size and cash generation. Our EBITDA per year is roughly $22 billion. Our net debt is below one-time EBITDA at the moment. Now, with this, it goes a bit up, but still super strong balance sheet. We have continued significant bolt-on M&A and BD&L firepower. No concerns there. It's not for lack of trying that we want to do more of these or we cannot really predict size of bolt-ons. It always has to come with the strategic fit and the science, the conviction on the science and what the patient impact will be and the returns for it. All of these are a bit opportunistic, but clearly, for me, this is absolutely online with our strategy of bolt-on M&A to strengthen the pipeline of our 48. Great. Thank you, Harry. Rajesh, on the readouts, there is the, as I mentioned, the cDUX biomarker readout in FSHD. Assuming we see compelling impacts on the biomarker, it would be absolutely our intention to go to FDA and have a discussion to see if we can get an accelerated approval. The Phase 3 study is continuing to enroll, and we'll continue to ensure that enrolls as fast as possible. I think for DM1, it's relatively clear, but we know the primary endpoint that we need to hit, and we need to hit those primary endpoints as well as have the functional benefits in the secondary endpoints aligned with what we saw in the Phase 2 study. Assuming we see that at the end of study 54-week readout with the 30-week interim, our goal would be to deliver this at the 54-week readout, then that would also create a compelling filing pathway. The good thing with these assets is the Phase 2 endpoints are aligned with what we're studying in Phase 3. We have, I think, a pretty good roadmap here of what we're trying to achieve in the Phase 3 studies, and that's what we're going to aim to do. Next question operator. Very helpful. Thank you. Thank you. Your next question comes from the line of James Quigley from Goldman Sachs. Please go ahead. Your line is open. Excellent. Thank you. I'm taking my questions. I've got two, please. As you mentioned, Harry, this is a fairly opportunistic deal, and it's difficult to sort of time when you can pull the trigger on these things. Clearly, this is going to have a positive impact on the long term and through the 2040s. How comfortable do you feel now with the portfolio as a whole? There's some fairly, obviously, high-profile LOEs that are coming up in the next four or five years. How are you sort of thinking around your ability to grow through those, as well as the balance between M&A going forward and your current mid-term or early-to-mid-stage pipeline? Second question, how broadly applicable could this technology be, and where do you think the key differentiators are in the technology? Is it the antibody targeting sort of neuromuscular system? Is it the linker or RNA combination? For example, is there an ability to potentially have a plug-and-play asset here where you can substitute the antibody, substitute the linker for a different payload, etc.? How much does Fiona have to play with when she bolts this into her development organization? Thank you. Yeah, thank you. I think first, from a growth standpoint, it's important to note we have full confidence in the internal pipeline and internal assets that we have. I mean, if you just look this year, we're launching remibrutinib, which we believe will be a multibillion-dollar asset. We have a positive readout for hormone-sensitive prostate cancer with Pluvicto, we have the ianalumab readout, which I know, I mean, different views, I know your view, but we have a very optimistic view that we can drive significant growth with ianalumab as well. We have three major launches, and we expect a very robust mid-stage pipeline as well behind that that gives us confidence going in. The goal then is to bolster the portfolio more, of course, because we want to continue to drive that dynamic growth into the next decade. We did deals like Tourmaline, we did deals like Anthos, and now with this deal, we bring in three more late-stage assets, a total of five additional late-stage assets, all with four out of five of those with multibillion-dollar potential. Of course, we'll continue to evaluate when we find highly attractive deals, but we're not in a situation where we're going to reach for deals where we feel like we have to do a deal. If we find something that's very aligned with our technology interests, aligned with our therapeutic area interests, we're, of course, going to go after it and ensure that we put Novartis in the best possible position. In terms of the technology here, I think there's many applications. Here you've already seen in these three drugs, you have both an antibody linked to an siRNA as well as an antibody linked to an oligo, so you have the ability to do both siRNAs and oligo. All three of these assets, the antibody is using targeting to the transferrin receptor, but as Bob mentioned, there's the potential to use this sort of antibody technology to target other targets for siRNA delivery. I would note, you know, Bob has a substantial portfolio of assets that he's pursuing for other neuromuscular conditions as well as other disease targets. We think there's a possibility to hopefully address a number of different organ systems in the body over time. Bob, anything else you'd want to highlight on the platform? No, I think you said it well, just that they have even further iterations with novel formats that we're really excited about exploring even further into the future. Thank you. Next question, operator. Thank you. Your next question comes from the line of Michael Luton from Jefferies. Please go ahead. Your line is open. Great. Thank you. It's Ben Jackson from Jefferies. I get the reason internally for why you did the acquisition and the overlay with the existing portfolio, but could you perhaps touch on to what extent the macro overlay dictates the therapeutic areas of focus for M&A? Is rare neuro easier to do at the moment versus kind of cardiovascular and INI? Any thoughts on that would be useful. Thank you. Yes, thanks, Ben. No, I don't think it was based on a relative view. We have a strong expertise with Bob and his team in neuromuscular disorders. If you've looked over the history, we've done acquisitions like DTX, like Kate Therapeutics. We have an internal portfolio. We've worked, of course, with Zolgensma and follow-on programs. I think this is very much aligned with our long-term interests in neuromuscular diseases. I don't think it's necessarily easier per se. I think it's just a very good strategic fit for what we've been investing in and want to lead in in the long run. Makes sense. Thank you. Next question. Thank you. Your next question comes from the line of Paul Kern from TD Securities. Please go ahead. Your line is open. Thank you. This is Steve Scala. Several questions. Just to be clear, Harry, I think you said half of the sales guide boost was from Avidity and half was from Novartis's existing business. Is that true of the margin hit as well? Half is from the acquisition and half is from Novartis's existing business. That's the first question. Second question is, what were the three most important questions during Novartis's due diligence process for the deal? What were the three things that you had to kind of get over in order to move forward? Third, I don't know if we're allowed three questions, but if we are, thinking back to the AveXis acquisition a number of years ago, it never really lived up to initial expectations set by Novartis. Why will this acquisition be different? Thank you. Thank you, Steve. First, on the half and half questions. Yeah. No, the margin expected impact over the next two or three years is totally due to the R&D expected to expand this year of this deal. The rest of the portfolio is wonderfully driving forward and offsetting off to some negative gross margin mix via very good productivity programs and expected top-line growth. Yeah, thanks, Steve. I'm not going to get into our due diligence, but I can say that we did an absolutely thorough due diligence on the profile of all the assets and, of course, all the standard area safety efficacy. As always, there's risk with all programs that are in Phase 3 studies. There's risk, of course, always. There's no guarantees in this business. I think based on what we saw in the Phase 2, where we saw the design of the Phase 3 studies, the regulatory feedback, the mechanism of action, the biomarkers, everything aligned, we think it's a reasonable bet. I would also say we have great expertise in this area. I think Bob and his team and Norman and their teams know this space extremely well. We feel confident that this is a phase-appropriate bet and a phase-appropriate investment, but there's risk, I think, if that's your point. I think, look, with AveXis, actually, it's over $1 billion of sales, and we are about to launch the IT ending agent. I'll invite you to look back in three years as to what your view is of the deal then. It can always be easy to cherry-pick in the middle. I think actually the two deals are unrelated in some ways, right? I mean, this is a completely different technology. I think RNA therapeutics here and the Phase 2 data and the Phase 3, and they have huge unmet need. Similar, huge unmet need in novel technology, but completely different technologies. I think trying to read through disparate deals is probably not very productive. Next question, operator. Thank you. Your next question comes from the line of Sachin Jain from Bank of America. Please go ahead. Your line is open. Oh, hi there. Thanks for taking my follow-ons. Two, just on topics we've sort of touched on. First, in the due diligence, I wonder if you could just comment on your level of comfort with the safety of the technology platform and mechanism given the clinical hold Avidity had. I know it was lifted a while ago, but just your level of comfort there. Then, there's been a couple of questions around the LOE and midterm growth. You've obviously raised the 2024- 2029 to 6% today. We've got the CMD around the corner. Is there still an intent to roll that guide to include 2030, which is obviously the post-Cosentyx impact? Any thoughts there? Thank you. On the second question, we will roll forward with the guide to 2030 at the means of management. On the clinical hold, Norman, you want to cover that? Thanks, Vas. Yeah, I think you alluded to the fact that safety was an important consideration during the due diligence since we're looking at a novel mode of action with a novel platform. The partial clinical hold occurred in 2022 due to a serious and rare neurological event that was fully investigated, and then the clinical hold was lifted in 2024. After that, full investigation was completed. In the meantime, we are looking at a really fairly established and mature safety profile. This is based on about 100, actually more than 100 patients dosed with more than 500 drug, which is some of these patients for up to three years, and that is at the dose of 4 mg/ kg, which was the dose that was implicated previously. I think at this point, we were confident that we're looking at an idiosyncratic event, and we feel good about the overall safety profile. There are no discontinuations in the study because of side effects, and overall AEs were mild to moderate. Good level of confidence at this point. Great. Thank you, Norman. Next question. Thank you. Please stand by. Your final question comes from the line of Gena Wang from Barclays. Please go ahead. Your line is open. Thank you for taking my questions, and congrats on the deal. My question is, why now, given the Phase 3 data will read out in, like, say, half a year or less than a year? I know the Phase 1/2 data is very convincing, but still you have a risk of a Phase 3. Why not wait for a little bit longer so that it would be complete de-risk before you do the full acquisition? Yeah, thanks, Gena. I mean, this is always the question, right? If you do go in at the clinical stage or after the readout, the evaluation, of course, could more than double, and then you're looking at a transaction that's quite substantially larger than this one. I think that is a judgment call. You, of course, could wait, but then you're looking at a very, very large transaction, potentially twice as big. In our view, the phase-appropriate risk was reasonable given the data that we've seen. We also have two shots on goal of a significant asset, either one of which would pay back the deal, and then both of which hit as very large value creation for our shareholders. We feel good about that as well. We think it's an appropriate risk to take. I think there is always that question. If you wait, of course, the valuation will run away from you, and I think that's why we thought this was a prudent move to do. Thank you. Okay, great. Thank you all for joining. I'm sure we'll be speaking with most of you tomorrow as well in our earnings call, so we'll look forward to connecting with you then. Thank you again. This concludes today's conference call. Thank you for participating. You may now disconnect.