Good morning and welcome. Please welcome Head of Teva Investor Relations, Ran Meir. He's already on stage. Hello, everyone. Thank you for joining us today at Teva Strategy Day 2023. It's great to have you here in person here in the New York Stock Exchange, and I want to thank also all the people who are joining us online through the webcast. If you want to follow the slides, our presentation slides, you can find a copy of the slides on our website at ir.tevapharm.com. Before we go to the agenda, I would like you to take a good look on slide number two. This slide contains the important forward-looking statements and additional information about the statements. Our non-GAAP financial measures is available on our SEC forms 10-K and 10-Q. Now, let's go over what we'll cover in the next two hours. Richard Francis, our President and CEO, will kick off with a presentation outlining the new strategy. Dr. Eric Hughes, our Head of R&D and Chief Medical Officer, will follow with a deep dive on some of the most exciting assets in our innovative pipeline. Finally, Eli Kalif, our CFO, will be explaining how it all comes together financially and discuss our long-term targets. After Eli's presentation, we'll open the floor for Q&A. Now I'm very happy to invite Richard Francis. Good afternoon, everybody, and welcome to all the people online. Really appreciate you making the effort to come down here today, to hear about the new Pivot to Growth strategy for Teva. I'm excited to communicate this with my colleagues in detail. To give a bit of background as to how I arrived here today. About seven months ago, I was looking at the opportunity at Teva, and I did some outside-in sort of analysis. The more I looked, the more I thought, "I think there could be something interesting here. I think this company could really have some capability for a bright future." Obviously, I thought that enough to join, and I'm glad I did, because now working with my executive management team over the last four months, where we've gone deep into the business. This strategy is based on detailed analysis, we've gone deep into every aspect of the business, trying to understand the strengths, the weaknesses of the company, looking at where the opportunities are externally, where the threats are. After all that thorough analysis, I can tell you I am more optimistic and more excited than I was when I'd done that initial due diligence. I truly believe that this Pivot to Growth strategy, which I'm going to walk you through today, is going to highlight to you that we can, Teva, become a stronger company, a bolder company, and a simpler company. What we offer as well as, we are much more than a leader in generics. I've heard your concerns. I've been speaking to many of you over the last four months who've questioned the ability for Teva to get back to growth. I've heard that, and I think those concerns are legitimate. I also think that this strategy gives us the opportunity to return to growth. We have to make choices, we have to prioritize, and we have to focus, but I'm convinced this will leave the company in a better position, and we will start growing again. I also believe we're at a turning point because some of the uncertainties we've had in the company are starting to become uncertainties in our history. Starting with our debt. Our debt continues to come down, and we're starting to get close to industry standards, and we've proven that we can pay our debt year-over-year. Second, the litigations, which obviously we've been working on for many years, they are pretty much finalized now with 49 out of 50 states when it comes to the opioid litigations. The third area here of uncertainties is, can Teva launch innovative products? That was a big question mark. I'm pleased to say in the last six weeks we've launched two. AUSTEDO once a day in our treatment for tardive dyskinesia, and UZEDY, our long-acting treatment for schizophrenia. I think we've proven that. I think these uncertainties, I would say, are starting to become appear in our rearview mirror. Now, when we talk about growth and we talk about what are the drivers for growth, let me talk you, walk you on to some of the core aspects I've seen as we've delved into the company's capabilities. One is, our portfolio already, our innovative portfolio of AUSTEDO, AJOVY, and UZEDY primarily, is already, by the way, 10% of our global revenue, so it's not insignificant. Obviously that's growing quickly. When it comes to the pipeline, which we're gonna go into detail at. This is something I didn't get to analyze when I was looking from the outside in. As I got closer and closer to the detail, what I've realized is there is a real innovative heritage at Teva and a real capability, particularly around antibody engineering and formulations. The pipeline that we have at Teva, I think is an exciting pipeline. It's based on validated targets and clear mechanisms of action. In my mind, that means it carries less risk than other pipelines may have. Our core business, our generics business, I think is obviously a global leader, and that business throws off a significant amount of cash, which in the short term allows us to pay down our debt, but in the longer term, allows us to invest in some of these growth drivers and some of this innovation. Last, and this is truly by no means least, is our people. Four months into the Teva organization, probably the most important asset we have in this company is our people and our culture. The can-do attitude that we have at Teva is remarkable. I think that's the attitude that I want to, and that's the type of culture that we need to have going forward. There's a real hunger for growth in this company, and I think that's gonna allow us to execute this strategy quickly and effectively. When I think about these, when we think about a strategy, I think it's always good to put timelines to it. Otherwise it stays very high level. This strategy is gonna be very specific. Let's start with the roadmap. I've broken this into three phases, short, medium, and long term. How are we gonna drive growth in the short term? Return to growth. We're gonna drive this through AUSTEDO, AJOVY, and UZEDY primarily. I'm gonna talk to you about how these products have particularly long growth drivers and the opportunity to drive growth over the revenue of the long term is significant. As we look to accelerate growth in 25 and beyond, these products will be supplemented by some of the pipeline Eric Hughes's going to talk about, long-acting olanzapine, ICS/SABA. We will also start to benefit from BD. We are getting back into BD. Obviously, that's going to be restricted a bit because of our balance sheet, but we are going to be active, and we are going to be very selective in what we bring in. It will be synergistic to our organization and allow us to keep growing the top line. We will also see in this period margin expansion, that will come through not only because we are driving this portfolio of innovation, but also the work we are going to do around creating a generics powerhouse, which I will come onto later. As we move into 2028 and beyond, then we'll start to get into that earlier-stage pipeline, which will start to come through, that'll drive and support growth. That's obviously around the TL1A and IL-15 and anti-PD-1/L1 that Eric will talk to you about. Once again, that'll be supplemented by BD. At that point, our balance sheet will be very different. What type of BD and what scale of BD we can do will be significantly different. Those two pillars will continue to drive margin expansion. That's the roadmap. What is the strategy? The strategy is based on four key pillars: deliver on our growth engines, Step-Up Innovation, create a generics powerhouse, and focus the organization. Starting with deliver on our growth engines. Now, one of the things I've realized as I've come in, we have some great assets, some great potential, but maybe in the past, we didn't allocate enough time, effort, resources, and managerial time on some of these assets. AUSTEDO is one of those. I'm gonna talk to you a bit about why I think AUSTEDO has a long runway of growth and a big potential for this company. When it comes to Step-Up Innovation, I think this is another one where maybe in the complexity of the company, we didn't really understand some of the great assets we had in our pipeline. Since Eric's come in, we've created a real focus on these assets. We've applied more resources, more managerial time, and more capability to make sure we can drive them through the clinic quickly and get them to the market. When it comes to create a generics powerhouse, what do we mean? We're clearly the largest generics company in the world right now. The powerhouse comes from being a more focused organization, making sure we're allocating our capital, resources, and our capability on the areas and the products in the portfolio that drive growth. That's both in our in-market portfolio as well as in our pipeline. You'll see the actions we're taking to create that focus as we go forward. Lastly, to create a more focused company, focused on what are the growth drivers, where is the opportunity, and making sure capital follows that. Another discovery I've had is our API business. TAPI, our API business, which actually is the second largest in that sector. We want to create a standalone unit for that to allow it to benefit from the growing market and the growing demand in API globally, which is growing at 6%-7%. I'll talk to you a bit about that going forward. These are the pillars that are going to drive the Pivot to Growth strategy going forward. Let me take these one by one. To deliver on our growth engines, AUSTEDO, UZEDY, and our biosimilar portfolio. Starting with AUSTEDO. Now, AUSTEDO has significant opportunity, and we've put down here $2.5 billion. By the way, this is by 2027. We're very clear on the timeline. Why can we achieve that? Well, primarily, unfortunately, there's a huge unmet medical need. Nearly 800,000 patients suffer from tardive dyskinesia, only a fraction, as you can see from this slide, are actually on treatment. That is a significant opportunity for us to make a difference to people who have this condition, but also to drive this brand going forward. The question is, can we do it? In simple terms, we are going all in on AUSTEDO. What does that mean? It means when it comes to actually making sure we have the right resources and focus, we will have it. We've already put together a new sales force or increased the sales force, should I say, and some of the channel mix and the spend we have around this product. In fact, I was just flown in two days ago from the launch meeting for the AUSTEDO XR for the U.S. team, which was also the launch meeting for UZEDY, the long-acting treatment for schizophrenia. The energy and the resources we've applied to AUSTEDO XR are significant and reflect the opportunity that this product brings to the company. There's other areas we can address on compliance and adherence to make sure these patients and these can stay on this therapy, take the right medication on the right day, and stay on it long term. We also know that the benefit of having a once-a-day formulation, which has arrived in the market this week, will allow us to improve our patient capture as well as the adherence going forward. We want to actually make sure we bring some of those untreated people suffering from tardive dyskinesia into the physician's office, and we've been doing that through a direct-to-consumer campaign. Last but by no means least, we're looking at geographic expansion, something which we probably haven't done enough in the past, and we're looking at taking AUSTEDO primarily to Europe. We're working through that opportunity immediately. Now, what does this look like from resources? Well, we're going to spend more because of the quality of the asset. We've already increased the spend on AUSTEDO by 20% this year, and that will go up by 40% next year. Once again, we are all in when it comes to AUSTEDO. Now moving on to UZEDY. UZEDY is our new treatment for schizophrenia, our long-acting treatment. Now, it's interesting. I was on a field ride in the U.S. about six weeks ago with some representatives who were promoting AUSTEDO. I met these physicians, psychiatrists, and clinical nurse practitioners to talk to them about AUSTEDO. Generally, on a number of occasions, at the end of the call, they said, "Oh, by the way, can I ask you about your long-acting risperidone? When is it coming?" Unsolicited, bit surprised. I inquired, "Why are you so interested in this product coming to the market?" They talked about this product profile, this patient-friendly product profile, and this physician-friendly product profile. What is key here is the fact that the current long-acting treatments for schizophrenia are an intramuscular injection, it's painful. Ours is subcutaneous, low volume, little pain in the injection site, can be kept out of the fridge. Useful things for a patient. For a physician, one injection and you're at the therapeutic level within 24 hours. There's no loading dose. You're done. There is no need for supplementary oral medication. You're done. When you compare that to other therapies, where the physician gives one injection, maybe has to give them some oral supplements, and then has to have them come back into the office again for the next injection to get to the therapeutic dose. The complexity there you can see for the physician and also for a patient, particularly one who needs relief from this episode. We see UZEDY actually as a significant opportunity. What is the opportunity? There are 2.5 million, roughly, people in the United States suffering from schizophrenia. Excuse me. As you'll see, only a fraction of those are long-acting, primarily because there is not a long-acting product with a profile like we have with UZEDY. That's what I learned when I spoke to these physicians and these clinical nurse practitioners. That market is $4 billion and growing at 6%. Once again, I said that UZEDY has an opportunity here to bring the right product to the patient and the physician, but also to be a growth driver for us going forward. Moving on to another growth driver is biosimilars. People have asked me whether biosimilars is really a growth driver going, you know, for the long term. Absolutely. There are some conditions to that, which I'll explain. In the short term, there are $40 billion of brands coming off patent, which we are targeting with our pipeline for the short term. Longer term, we have 13 assets which we wanna bring to the market. We see significant opportunity to drive growth short, medium, and long term across this Pivot to Growth strategy. In the short term, these are the biosimilars we'll bring to the market. This is where the $40 billion of value comes from. In the long term, our strategy is gonna be around leveraging our capabilities and portfolio size. I think to be a successful player in biosimilars, you need to have a few attributes. One of them is the footprint, the geographical footprint, but the commercial capabilities. To take these products to markets in very different healthcare systems, sometimes you require sales and marketing, sometimes you require contracting expertise, channel, sometimes in the hospital, sometimes in the retail. There's multiple things. Teva has all of those. We have this infrastructure that we can leverage. We also need to have manufacturing at scale, which is what we have at Teva as well. Finally, our strategy is going to be about doing partnerships because we want to build a big portfolio to leverage this platform. We want to have more and more biosimilars that create synergies, which creates an opportunity to drive longer-term growth and margin improvement. It also allows us to think about capital allocation and how we allocate capital and how we think about risk, which we'll address both of those with partnerships. That is the pillar one. That is deliver on our growth engines. On two, pillar two is Step-Up Innovation. I'm only gonna talk a little bit about this because I don't want to step on Eric's toes. Once again, this is a pipeline that we haven't communicated much in the past, but we're gonna communicate 'cause I think it's important people understand the quality of our pipeline. This goes back to the quality of our people. You know, we have an innovative heritage. We have it with COPAXONE and many other products we brought to the market. And many of these assets, particularly antibodies, come from within Teva, and that just shows our antibody engineering capability. What I want to talk to you about today is just three of them. olanzapine long-acting, ICS/SABA, and TL1A. Starting with olanzapine. This is a product which I think has real potential. It does rely on having the right efficacy and safety profile. The reason why this particular molecule hasn't transferred from an oral to a long-acting in the psychiatrist's office is because there is no long-acting that has the right efficacy and safety profile. We're going to show you today, and Eric's going to show you why we believe we have both of those. It goes back to the technology we've leveraged with UZEDY. This is not something new we're trying to do. We've already proven we can do it with UZEDY. For me, that's relatively de-risked. You've seen the size of the opportunity in the schizophrenia market, long-acting $4 billion. With this particular molecule, as I said, none of them have moved across to the long-acting because of the challenges and the lack of the right product profile. Now moving on to ICS/SABA. Now, this is an interesting one in that when I looked at ICS/SABA, it was one I had to look at a few times before I really started to understand the value this could bring to the company. Now, when you bring a product to a market, there are certain things you want to see. One, you want to see a significant unmet medical need, which we have here with 10 million patients, people on SABA. If you can, you have guidelines and recommendations by the association saying that patients should be treated with a product that you have, which is ICS/SABA combination. The guidelines now are saying that the 10 million SABA patients should be switched to ICS/SABA. The second thing you want to know is, do you have the capability to execute on that? When it comes to research and development, we have a device expertise. We do. It's long-standing at Teva. Do we have a respiratory understanding in the market? Absolutely. We've been in respiratory for a long time. The final thing is, what are the barriers to entry for other people? I think when it comes to developing devices and combination products, that is difficult. At Teva, we've shown we can do it. For me, this means this has a long-term runway for revenue growth. The size of the market is not insignificant either. $2.5 billion, we estimate. It all depends on how many of the patients switch from SABA to ICS /SABA. Once again, an asset which can hit our pipeline in our mid-term and deliver growth. Now moving on to TL1A. Well, this is a bit of the talk of the town right now. Once again, this is an in-house product we developed through our antibody engineering capability, and we believe it's the best in class. We believe it's the best in class 'cause of its potency, selectivity, and its low level of neutralizing antibodies. Now, what's exciting is not only the quality of our product, but the fact that this can go across multiple indications. If you just take ulcerative colitis and Crohn's disease, the market could be significant. We've estimated here, and I think that's been agreed generally, there's about a $25 billion opportunity. When we think of the later stage of our pipeline coming through, the significant growth can come from this product. As I already said, this is a target that's been validated to a certain degree. Eric's gonna show you some really exciting data to help back up what I just said. That's our step up to innovation. Now let's move on to how do we create a powerhouse in generics. Well, firstly, we're in a great position when it comes to generics. We have a few things that I think are essential to have a sustainable business. Firstly, we have a geographical spread. We have 60%, slightly over 60% of our business outside the U.S. It's growing consistently at high single digit, and it's very profitable. It's based on some core competencies that we have in those regions about scale, infrastructure, and pipeline. In the U.S., we have also some capability and scale, particularly around high-value generics, complex generics. There, there's a lot that we have already. What do we need to do to turn it into a powerhouse? Focus. We need to be more focused on what we do. That starts with the fact that when it comes to all the portfolio that we have in the market, we need to make sure we're focusing our efforts on the areas where we can add value and drive margin. The low-margin areas of our portfolio, the ones that are dilutive or even loss-making, we need to remove them from our portfolio and allow that space in our factories and in our portfolio to be taken up by the products we can sell more of, because there are those. At the same time, when it comes to R&D, we have said we're gonna go after 80% of products coming off patent. We're not gonna do that anymore. We're gonna go after 60%. Why? Two reasons. The majority of the value is with the 60%. The incremental value for that extra 20% is marginal. What is not marginal is the amount of work that puts to in the organization and the amount of complexity that adds. We want to focus on less to get more, and particularly when it comes to our complex generics that we want to bring to the market. As you know, historically, we have a mixed track record of bringing those to the market on time. Our belief is in this strategy is if we focus on less with our resources and our capability, we have a chance to improve the probability that we'll bring to these products to the market on time more often. If we do that'll create more value both on the top and the bottom line. It's a focused approach to our R&D. Now these two things above allow us to continue to optimize our network. We're gonna continue to optimize our network going forward because this will allow us to drive more efficiencies, more utilization, and lower our cost of goods, which once again, will drive our margin up. These three things together create focus and create a generics powerhouse. Now moving on to the fourth pillar, creating a focused business. As I've walked you through the business, you can understand that we have different segments of it, but we're gonna become very clear in this strategy where we're gonna focus our time and where we want the growth. It's around our innovative and our biosimilar business. We have, with this generics powerhouse, a very sustainable and predictable business going forward. That's what we want to see. That will allow us to direct capital, resources, and money into our innovative business. It's an enabler. With regard to TAPI, I wanna touch upon TAPI, our API business. We're gonna move this out from within Teva to have it as more of a standalone. The more we analyzed it, the more we realized its potential and how that potential was being restricted by being encompassed within the organization. Let me talk to you a bit about TAPI. Firstly, this API business is the second largest in the industry. It focuses on high value API, so its margins are high. This is accretive to Teva's business from a margin point of view. Itself, its resources around manufacturing R&D, it has those standalone R&D and manufacturing capabilities, and it's not vertically integrated within Teva. Teva does not rely on the TAPI business. This gives us opportunity to maximize this business going forward, to drive growth on this business to allow us to grow the top and bottom line. That's what we aim to do, to create a standalone business with a focused management team, with one goal, to grow this business. To maximize the opportunity which we see in the API market, which as I said, is growing at around 6%-7%. This is a differentiated API business with high margins to allow us to go after that whole market. That is the Pivot to Growth strategy. Those are the pillars that are gonna drive that strategy. The question I just wanna remind everybody is how we do our business at Teva. When it comes to our ESG agenda, we're very committed to this. When it comes to the environment, the progress, and we've published our goals, we're making great progress on that. When it comes to access to medicine and our societal impact, we're still committed to that. We will still have a significant portfolio where we can drive access to medicines around the world. How we do our business, high level of integrity and a high level of compliance. That's what we aim to achieve going forward. With that, with the introduction to the strategy, I'm now gonna hand you on to that second pillar, which is Step-Up Innovation, and hand you on to Dr. Eric Hughes, who will walk you through that. Thank you, Richard. You know, I'm very excited to be here today. I'm Eric Hughes. I'm the head of R&D and the CMO for Teva. You know, for 20 years, I've been at a number of large pharmaceutical companies, and I've really developed an appreciation for cutting-edge science. When I started at Teva 10 months ago, I was very pleased to see a really rich and innovative pipeline, and that's what makes me really confident that we can really step up in innovation. What's our strategy for stepping up in innovation? one, we'll focus on our key therapeutic areas. That includes neuroscience, which we have a long heritage in immunology and immuno-oncology. As Richard mentioned a little earlier, you know, we'll leverage our strengths. We are very good at engineering antibodies. We are very good at making formulations. We have a great device group that can develop very complex devices for delivering. You know, we will focus on accelerating the late-stage innovative pipeline. It's very strong de-risk to a certain extent. We're really gonna be putting all our resources on that effort. Finally, we'll reallocate some of our great expertise from our generics group into our innovative medicines group. Richard just showed you this slide very briefly. You know, I'm not gonna get into all our pipelines here, but I wanna focus on four of our really exciting assets in our innovative medicines group. First I wanna talk about olanzapine LAI, really a promising program building on the great technology we use for UZEDY called SteadyTeq. I'm gonna talk about this program that's, as Richard mentioned, is very popular in the news right now, our anti-TL1A program that we've been in for quite a while. We'll be bringing that forward in ulcerative colitis and Crohn's disease. The third I wanna focus on are, which is something we haven't talked about at all before, is our anti-IL-15 program in celiac disease. Finally, I wanna really highlight a very exciting program we have called Attenukine. This is a program that we can develop molecules to bring better treatments for patients with cancer. First, olanzapine LAI. You know, we should talk first about this patient population. It's a devastating disease to have schizophrenia. You know, these people are isolated. They have difficulty interacting with society. It's not only devastating for the patients, but for the families that care for these people. There are two million people in the U.S., even more than two million, that have this disease. You know, given the devastation, the good thing is that we have treatments for it. You know, when you take medicines for this, you can actually perform very highly in society. The trouble is most of those treatments are oral, and we know that it's difficult to be adherent to medications. We all have trouble taking our own medications, in particular, for a variety of reasons, these patients are not completely adherent. When you're not adherent to the medication, you relapse, you get hospitalized, you go in a spiral of worsening disease. How do you fix adherence? Well, long-acting injectables are a key to making this a better treatment for patients. UZEDY is a great example. We just launched that. We're very happy about that approval we just got. That really is a great example of the technology that we've developed in-house called SteadyTeq. It's a copolymer that delivers a long-acting injection. For UZEDY, it's one to two or two months. We're applying that same technology to olanzapine LAI. You know, UZEDY will treat those mild to moderate patients. Most of them will likely come who are taking risperidone or paliperidone now. olanzapine, though, is that next more powerful medication that physicians like to use. You know, we have an option for these patients who have no viable current long-term injection. Very important for patients, we're very excited to be studying this. You might be asking, what about PDSS? PDSS is a infrequent but serious complication that the current intramuscular injection causes with olanzapine. You know, with a deep intramuscular injection, you can nick large blood vessels, and you get a high peak concentration of a drug on occasion with an injection. That causes a syndrome of lethargy and sedation. That can give a black box warning to the long-acting injectable that's intramuscular. What's different about our compound or our development or formulation, and why are we so confident that we're not gonna see PDSS? Well, first of all, it's a subcutaneous injection. A subcutaneous injection is much more tolerated than an intramuscular deep injection. You're not near the large vessels where you're injecting. Second, the best part about this is the type of co-formulation we've made with this copolymer. When you inject this formulation, this SteadyTeq formulation, it rapidly aggregates and forms capsules around the drug, and then it lets the drug slowly release over a one-month period. You're far away from large vessels. You're aggregating the blood in a depot that slowly releases the drug. We're very confident we will not see the PDSS, and we're very excited to bring this compound forward. We've already started the phase III, and I'm really happy to say that it's enrolling well. This is a randomized, controlled, double-blind study working at three different doses of olanzapine LAI for a one-month injection each month for the first eight weeks, and then we roll the folks over into a long-term follow-up study. It's a large study of 640 patients. This will include 3,600 injections in total. We'll have a very good database to show not only the efficacy of the program or the compound, but really the safety profile. We're really hopeful. It's a promising product, and we're excited to see the results. Now moving on to TL1A. This is a very exciting program we have at the company. Just to review a little bit, you know, inflammatory bowel disease is a large population of patients. There's four million patients in the U.S., it's a chronic inflammation of the gut that causes not only inflammation but then fibrosis as well. This is really impactful for patients. You know, these symptoms are diarrhea, abdominal pain, and bloating and can really disrupt a person's lives. Many of these people actually go on to having surgery to correct some of these problems. It's not an insignificant disease, and it's really impacting patients' lives. Now, 60% of these people get treated, but most of that is non-targeted therapies, and when they do get to biologics, they cycle through the biologics because of non-response. There remains a high unmet medical need for ulcerative colitis and Crohn's disease. Now, why is TL1A such a interesting and talked about MOA? One thing about TL1A, the cytokine, is it has a real pleiotropic effect. It hits many different areas of the immune response to turn it up. It also has a dual effect, we believe, on fibroblasts, so it creates fibrosis as well. Blocking TL1A has the potential not only to down regulate inflammation, but also halt or reverse fibrosis. Very two exciting potentials of this target. One thing to remember is there's two receptors for TL1A. One is the actual DR3, which is the one that signals binding inflammation, and the DcR3, which is a decoy receptor that takes away TL1A in a natural response to overinflammation. A very promising target. You know, because of this pleiotropic effect, it could be used in many different indications potentially, and it probably will be studied in many in the coming years. What's special about our antibody, and how did we design it differently? As I mentioned, there's the DR3 receptor. That's where the inflammation happens. That's the one you wanna block. There's the decoy receptor, the DcR3 receptor. Again, this is this inducible receptor that when there's an overproduction of TL1A, the body naturally produces it to create a homeostasis in response to any inflammation. What we did here is we developed first a very potent antibody, and second one that would target the TL1A to block the DR3, but to also maintain the clearance of the compound and the cytokine in the natural clearance pathway. Very clever science, very good engineering by our scientists. Why do we actually believe this is true? Here, first let's look at the these graph on the left. This is just looking at TEV-'574. That's our compound. You can see in this inhibition assay in vitro that we have great potency for the DR3. When you look at the DcR3 on the same assay, we have about 117 fold less potency. We're hitting the inflammatory signal, and we're maintaining that natural decoy clearance of the cytokine. This is strong evidence about the potency and the selectivity of the compound. Now, on these middle graph and the graph on the right, we created two comparator reagents in our laboratories based on patent information on the two clinical candidates that are currently in development, named number one and number two. You can see with number one in the center that there's slightly less potency, and there's also no selectivity between the DR3 and the DcR3. Less potent, less selective. On the right, the comparator, a reagent number two is directly compared to TEV-'574. You can see that we're about an order or one to two orders of magnitude more potent than number two. I hope you can see from these in vitro assays that we're more potent and likely more selective than both compounds. There's more to it than that. One of the things that's important when you're targeting a cytokine is you've got to be able to measure the cytokine that you're targeting. It's not talked about much because it's hard to make these assays, but here we're looking at actual knocking down of free TL1A. That's the cytokine that is actually biologically active and available to cause inflammation. You can see these non-human primates here, we gave a single dose of TEV-'574, and you get a rapid reduction, almost down to undetectable levels, and that stays suppressed out for 14 days. We're very happy to see that we're actually having target engagement acting on the actual cytokine that we're trying to knock down. Very good supportive evidence of the potency of the compound, and the clearance and the effect on TL1A levels. We're very excited to see this, and we're moving forward rapidly in our study. Hopefully you can see, you know, with the preponderance of the evidence right now, you know, we have the potential to be a best-in-class TL1A. We have greater potency, greater selectivity. We have animal models that show reduction in inflammation and fibrosis. We had done an asthma study where we actually showed that we had a favorable safety profile that was tolerable and had similar AEs to placebo. Importantly, in that study, we saw less than 10% anti-drug antibodies as well, which is critical. In my experience, great programs are ones that have low antibody anti-drug antibodies that maintain a long effect when you're treating patients. Finally, as I mentioned, Teva is great at making devices. We're working on our subcutaneous auto-injector now, and we'll have that for phase III. We started our ulcerative colitis and Crohn's disease study. It's a double-blind, placebo-controlled randomized study. We're looking at three different doses, the typical induction phase of about 14 weeks. Those folks will then roll over into a long-term follow-up. This is a large study of 280 patients. It's important to remember it's a basket study. Half of the patients are ulcerative colitis, and the other half are Crohn's disease. In fact, this might be the first example of a randomized controlled study for Crohn's disease with this MLA effort. We're excited to get this study going. After we have an interim analysis of the second half of next year, we'll talk with health authorities to design our phase III program. We're not all about inflammatory bowel disease. We also have a program in celiac disease. Celiac disease is a high, you know, prevalent disease. About two million people are believed to have celiac disease, but many of them are undiagnosed. It's almost like a disease that's, you know, been forgotten to a certain extent. It's terrible because these people really suffer from, you know, diarrhea, bloating, and abdominal pain. What causes that? Many of you may know the disease and someone who has it because it's really in response to gluten in the diet. When you eat gluten, the body produces a key cytokine in the gut, IL-15. The IL-15 attracts intraepithelial lymphocytes to the gut wall, causes inflammation and damage to the lining. It's a really problematic disease because you know, I challenge you to ever try not to eat gluten in your diet. It's actually very difficult. Even people who are fastidious in keeping gluten out of their diet sometimes get exposed to it even when they're really trying. It's almost like a Sword of Damocles. You never know when you're gonna just awake all night long with abdominal pain and diarrhea. It's difficult. Even in about 20% of those patients, even if they stop all the gluten, they still don't respond to a non-gluten diet. We should aspire to do better for these patients. Why are we excited about our program? Again, our scientists have developed a high-affinity antibody for IL-15. What I'm showing here on the right is a graph of free IL-15 of the first two completed cohorts of our first-in-human study. It's impressive the amount of suppression we see. You can see at the top dose in green, there was suppression on a single dose all the way out to 80 days. Even at the lower dose, we saw a suppression out to about 40 days. Very potent activity. Good, you know, good potential for having maybe a Q one week or a Q one month or Q two-month therapy for these patients. Very exciting novel biology, really working fast to get into patients to show proof of concept. We'll have more data in this next year. Now, moving on to our Attenukine technology. This is very exciting work that we've been doing for about 10 years at this point. And as an immunologist, I get very excited about this because it's really taking advantage of things that we've studied for decades and have learned a lot about. Certainly IL-2 is something you know a lot about. Interferon is something we know a lot about. PD-1 and targets that we are working on, we know have learned a lot about. What's the idea behind the Attenukine? We can give people cytokines. You can give people IL-2. You can give people interferon alpha. We know that they can have treatment effects, but the toxicities are intolerable. Vascular leak syndrome, cytokine storm, the toxicities limit the power of cytokines. What are we doing? We're taking those same cytokines, we're weakening them, attenuating them, and we're attaching them to antibodies and directing them right to the cell where they take their effect. A very potent activity of a cytokine, but making it more tolerable by weakening it, but bringing it to the place where it needs to work. It's a great idea and it's great technology. We've shown that it works. With the Attenukine, you see here on the slide, we made one to anti-CD38 connected to interferon alpha. When we put these two together and with our trusted partner at Takeda, we outlicensed it, and we're really happy to see that, in fact, for multiple myeloma, you can see that they got a 43% observed response rate and then a 10% complete response rate. Remember, these are in highly treatment experienced patients. We gave great benefit to these patients in a novel way using this Attenukine technology. Proven, and we were very excited to see their data. What are we doing next? This is a particularly exciting program where we're taking IL-2, attenuating it, connecting it to an antibody that then brings it to PD-1. You probably know what PD-1 is. PD-1 is the inhibitory signaling in cell in cancer that has revolutionized immuno-oncology. This is a target where when you block this signaling receptor, you can really turn on the immune system to actually kill cancer cells. We're taking advantage of that target, and we're bringing the IL-2 directly to those cells. If you think about checkpoint inhibitors, it's like taking your foot off the brake to treat cancer, and we're putting the foot on the accelerator to treat cancer. You can see here, you know, we can do this with systemic IL-2, but it really has failed in the past. We're different from systemic IL-2s. Why do we believe so much in this Attenukine? I'm looking at a number of tumor models here in mice. On the far left, you can see when we treat these animals, they get a tumor in-injection, but when we treat them with vehicle, the tumor grows very rapidly. It's in gray over about 40 days. If you give them a checkpoint inhibitor, PD-1, and you add IL-2 that's not bound, they do a little bit better, as you might expect. When you give them the PD-1 IL-2 together, there's almost a complete suppression of any tumor growth. A really robust preclinical evidence. The really exciting thing as an immunologist to see is when you take those same mice that survived the first experiment, you don't even need to treat them again. They have immunologic memory and keep the tumor from growing back. Very powerful treatment and then induced an immunologic memory. Finally, on the last graph, I just wanna really prove the point. You know, same similar tumor model, rapid growth in the gray in vehicle. The blue line is then a checkpoint inhibitor. It's similar to what you see in the real world. Even when we give our PD-1-attached to the IL-2, it again, has great suppression, but we're not blocking the PD-1 IL-2. One of the more ingenious things the scientists did was make a non-blocking PD-1 IL-2 using the IL-2, so if you needed to use this compound with a checkpoint inhibitor in the future, we can. We know that they bind, and it gives us a great strategy going forward. I certainly think that potentially we can use this as monotherapy, but if we need to use it in combination with other checkpoint inhibitors, we can. Great potency, great activity, very strategic way of designing a molecule. You know, hopefully you're as excited as I am to see our progression in these different programs. You know, our olanzapine LAI program is, as I mentioned, started, and we'll see the results in 2025. Our interim analysis for the TL1A program will be the second half of 2024. We'll have much more phase I data in our IL-15 program next year. We're really excited to get our PD-1 IL-2 into patients in the first human at the beginning of 2024. Finally, ICS/SABA read out in 2026. Just to leave you with a few takeaways. You know, we have a great late-stage program, a de-risk program with ICS/SABA, olanzapine LAI, and our TL1A asset. We're really excited by the fact that we're at an inflection point for our early program. You know, our scientists have been working for a decade on these, and now we're at the point in which we're bringing them into the clinic. We're near the clinic, you know, we're filling that pipeline as we speak. Last but not least, we will always want to complement our expertise with BD activity and in licensing. With that, I thank you for your time, and I appreciate it. I think the next person is Eli. Thank you, Eric. Welcome, everyone. Thank you all for your interest in Teva. It's really pleasure to see you here today. Thanks for those that are joining us online. Just before I start, I would like to frame our discussion today. With all the information you saw from Richard and Eric, today I'm going to discuss about our process so far and also how we're heading into our new funding growth strategy. I will elaborate on the last four years and the progress we've done, and I will also mention the fundamental financial principles that we established. Then we'll talk about our liquidity, debt management, and we'll share with you the view of how we see our capital allocation for the coming years. I've been with Teva now for the last four years, and so far the team done tremendous job on focusing on robust programs. We keep fulfill our commitments with a great discipline and essentially, strategically, we created kind of a huge shift that I truly believe that position us to a very well, I would say, achievement going forward. We improve our margins from 2019 to 2022 by more than 300 basis point to a very extensive restructuring and optimization of the business. We had a significant reduction in our debt, and by this we lower our net debt to EBITDA ratio to the level of four, and we will see ourselves heading back to become an investment-grade company. Based on the insights you heard today from Richard and Eric, we established a fundamental financial principle that will allow us to execute and to achieve our growth strategy. First, free cash flow. We're optimizing further our free cash flow. We're leveraging our generic powerhouse for solid cash conversion. In the last two years, we took specific, distinct initiatives about our working capital to have a better match, supporting our business with more efficiencies. Secondly, it's about liquidity. You saw us earlier this year hitting the market with two main activities. One, we had a very successful refinancing for the 2023, 2024, and 2025. By this we were able to make sure that our free cash flow generation have the ability to serve the debt. Second, we made a covenant in order to remain and to have us a certain level of financial flexibility. Now, with the new Pivot to Growth strategy, we look at the business and we need to make some clear choices. What does it mean? It means that part of this process, we're moving through a portfolio optimization on certain assets. We are going and evaluate certain assets at the companies across our brands, across our other elements, and then by this enabling for ourselves a room to maneuver and to invest in growth and in potential business developments. Business developments, that's for the short term, are more partnership and license deals, and for the long term, also M&A. Through this whole process, we're trying to check the box on those three elements, as you see here. First, aligning to the growth strategy. Second, make sure that it's aligned with the working capital optimization. Third, high conversion to cash. Let's go through some other elements. We start with our generics business. With a clear strategy, as Richard mentioned, on our generic strategy, by our ability to get focused on those high valued generics opportunities, narrowing our coverage on the LOEs from 80% to 60%, we're actually streamlining and optimizing our generics business. By simplifying that business, you will see immediate reduction in costs. That will improve our gross profit and our gross margin. Also, as Richard mentioned, we are aiming to remain to become leaders in that area. Now, I will elaborate later about how we see ourselves in terms of our manufacturing network optimization. With all those activities that I just mentioned, we are fueling innovation. You will see us shifting between 15%-30% from R&D budget on generics into more innovative programs. That will help us to do mainly two things. One, maximize our late-stage programs, which is the mostly olanzapine and TL1A. Also have the ability to accelerate early-stage programs into a more later stage. This slide is actually demonstrating our manufacturing optimization. This is in full swing. Today, we have 52 sites. By end of 2024, we predict to reduce another four sites. By end of 2027, another four up to eight sites. This exercise is not simple, super complex. You need to make sure to keep smooth supply chain. You still have the ability to move programs, get the right certification, consolidate the business. This is one of those muscles that our company is very strong. Effectively, we reduce from 80 to 52, 35% from our manufacturing footprint that reduced. With this one, we will see a huge benefit on our cost base. Now, another element I would like to discuss, it's about our R&D. Here you see a graphic illustration about our R&D allocation. You saw us in the latest years splitting our R&D allocation into 40% for innovative, 40% generics, and 20% biosimilars. As we are pivoting into our growth strategy, you will see us more allocating into the innovative area, around 60%-80% by end of 2027. Now, this is not just about shifting one program from generics to innovative. We're actually going to have significant growth in our revenue, which mean that the entire R&D budget is going to grow, and by this, that slice between 60%-80% is going to increase, and that will keep fuel our innovation. Let me talk to you minutes about our debt and liquidity. I want to assure you that with the proactive discipline and strategic activities that we've done so far and we'll keep doing, we'll keep reduce the debt. We'll keep deleverage. You saw us early this year by clearing our runway for the next three years, allowing us to serve the debt with our free cash flow generation. Effectively, if you think about it, from 2017 until today, we paid more than $20 billion to our bondholders. You will see us coming back to the market at the end of 2024, early 2025, to treat the 2026 and 2027 to make sure they're also sorting into our ability and to finance it from our free cash flow. Then it's about our cash and revolver. In the latest, I would say, quarters, we didn't done in any draw on our revolver, but we see it as a very, very strategic vehicle for us. We amend the covenant in order to keep that financial flexibility for any business development that may arise in the near future. So far, we discussed about our progress, we discussed about our debt management, liquidity. I want to share with you how we view our capital allocation. We established a very comprehensive capital allocation strategy in order to make sure that we're able to fuel our innovation and to balance with our financial commitments and keep our growth. The source, cash flow from operation, all those activities that I just mentioned, which keep optimizing our free cash flow on conversion, simplifying generics, and in addition, the cash that we'll generate from our portfolio assets optimization exercise. Those we'll use with the following order. First, keep the leveraging, keep reducing the debt and make sure that we have a strong balance sheet. Second, we will fuel more our existing growth drivers, AUSTEDO, AJOVY, UZEDY, and also supporting a new launches in order to keep our competitive advantage. Lastly, with the right prioritization and allocation on investment on R&D, fueling innovation, as well with a very disciplined, strategic, selective activities, we'll invest in business development. Many of you have been asking us if we're going to keep the 2027 financial targets, and the answer is yes. In the last several months, when we went into the entire strategic review, run again our models. Today, I'm here to tell you that we're going to retain them. From what Richard mentioned earlier, and Eric, you saw a very, very clear strategy on how we're going to lay a growth in our revenue to at least mid to single-digit growth. We're going to hit the 30% operating margin by end of 2027, and we'll keep lower debt to the level of 2 x net debt to EBITDA. Of course, for all those three elements, we need to keep as a strong cash conversion. Now, before I hand it back to Richard, I would like to have kind of a key points for my presentation. First of all, by reallocating resources, optimizing our portfolio, prioritizing investment in R&D, and with the strategic discipline and selective investment in business development, we're fueling innovation. We are supporting sustainable growth, and we are providing a long-term shareholder value. We set a very clear comprehensive capital allocation in order to allow us to balance between our financial commitments and our ability to support growth and invest in our growth engines. As far as related to our financial commitments for 2027, I want you all to understand that the entire executive management, the entire organization at Teva, taking it very seriously, super seriously. We are all in. Now, we are all in to make sure that we enable growth. More important, profitable growth to enable us to expand our margin, convert it to high cash, keep serving the debt, and make sure that this company is really moving to a new chapter. With that, I will hand it back to Richard for final remarks, and then we will open it for Q&A. Thanks. Good job. Thank you, Eli. Thank you, Eric, for that comprehensive overview of the pipeline and the financials. Now just to conclude, and then we'll open up for some questions. As you've seen that from a strategic point of view, we're making some very clear choices. We're making clear choices about where we need to allocate capital and where we need to allocate focus, resources, and time. Here, this slide just illustrates when it comes to innovation and our biosimilars, those are our key growth drivers in short, medium, and long term. The enables for that are the generics power, as we've described, how we're going to create, and also the legacy specialty. We're gonna take TAPI, our API business, make it a standalone, so we can maximize that asset and that organization, which clearly has room to grow, which would also help drive our top and bottom line. What does it all look like from a financial point of view? Well, to give you a sort of an illustrative idea, I've sort of put together this bar chart. This shows really what I want you to take from this slide is the majority of our growth is gonna come from our innovative products and our biosimilars. What you must understand is our innovative products now, AUSTEDO, UZEDY, AJOVY, and there's some in this timeframe maybe of olanzapine. I point that out because those in the market now, we have them and we're promoting them and we're selling those now. I think that gives a certain level of certainty. We can debate the size of the bar, but the fact that we are gonna drive growth going forward on that. The same with biosimilars, our portfolio as it comes through and as we bring that to the market. What I would ask you to think about is as you think about our business going forward and you analyze it and critique it, we clearly are changing some of the dimensions of our business now. From a company that had a core generics business, we're gonna create a more sustainable business, but we have a significant portion of our business now, over 20%, that's gonna be innovative. That has different margins, as Eli spoke about, different levels of profitability and also different multiples, as does biosimilars. I think that's something to consider as you evaluate the company going forward. The Pivot to Growth strategy, in summary, Teva tomorrow will be a stronger company, a sustainable generics powerhouse with predictable revenue and margin improvement and increasing going forward. A bolder company where we double down on innovation, and we actually end up doubling our revenue in innovation, which generates significant upside from a profitability point of view. A simpler organization because we understand what each piece of the organization is responsible for doing and how it contributes to the Pivot to Growth strategy. Obviously, TAPI as a standalone organization to maximize that opportunity. Thank you everybody in the room for your time and attention, for listening to us, and thank you to the people online. Now I think we're gonna take some questions if you have any. Thank you. Shall we drunk out of that one? Thank you. Good afternoon, everyone. Thank you for a great presentation. I'm sure you and your team has gone through sleepless nights to come with this. One of the questions I got recently from a fairly large holder for your firm is on the generics business to see if at any point of time do you take a look at divesting the generics business, though that's Teva's claim to fame? At what point do you decide that this is still valuable to retain as a business, as a core for Teva? That's question number one. Two, just on UZEDY, big fan. On AUSTEDO, if I look at where we are today, around $1 billion of business for this year. If I grow it at 15%, I'd probably end at around $1.7 billion by 2027. There's an incremental $800 million that you're expecting from geographic penetration or increased diagnosis. I'd love to see how you can break that down further. Thank you. Okay. Thank you for the question. If I understand the first one correctly, it's about whether we separate the generics business at any point. The answer to that is no. In our Pivot to Growth strategy, hopefully we've articulated clearly that our generics business, once we've actually turned this into a predictable business at high levels of margin, actually is a real asset for the company as we drive the innovative proportion of our business. Because once our debt gets down to low levels, we're generating a lot of cash to actually invest in those growth drivers. I think the answer to that is no. The answer to your second question about AUSTEDO. The confidence comes from the fact that I think this is an asset that apart from the fact that the penetration of the patient population is relatively low, is the amount of support and resources we've put behind this asset in the past. I think the team have done a phenomenal job in driving the growth we've seen. What I spoke to you about earlier, about 20% extra resources this year and 40% extra next year and extra sales force, the work we're doing around the channel, compliance, adherence and conversion. Taking a patient that gets a script but ending up on a long-term therapy, the dropout rate there is significant, right. We call them holes in the bucket. We're gonna cover those holes in the bucket to make sure those scripts regenerate. We're gonna keep generating more as we convert into patients on long-term treatment. I think when you think about the journey from patient to physician's office, the physician's office to treatment to long-term treatment, there's many areas where we see an ability to have an impact. You know, we didn't put out the two and a half billion lightly. I mean, I knew that would be critiqued and scrutinized, but I'm confident we can achieve that because the progress we've put in place and the understanding of the market we have. I hope that answers the questions and thank you for the question. Thanks for the presentation. I had a couple on capital deployment. You talked about, you know, maybe more actively engaging in business development going forward. After looking at the cash that's likely to go to debt pay down, you're maybe looking at $1 billion-$2 billion of cash for acquisitions over that five-year period. I guess when would we start to see the company maybe looking to do deals? Is business development included in that mid-single-digit revenue growth guidance that you gave? Sorry, just lastly on this topic. Do you have any thoughts around potentially exiting some of the legacy products that you have, given that they have been a drag on the company's overall growth? Thank you. I'll sort of give a flavor answer to that and then, Eli, if you wanna come in a bit. Yes, we are gonna do business development. It is gonna be constrained to a certain degree by our balance sheet in the short term. As Eli's pointed out, you know, the progress we're making on our debt is significant and we're gonna get down to investment grade, you know, pretty quickly in the near term, I think, two to three years. That gives us a lot more flexibility obviously going forward as to how we would fund acquisitions if we wanted to do them. I think we need to think about the BD in regards to our balance sheet. We're already actively stepping up our efforts in BD. I can tell you just in the last four months we are. Now, with the constraints we have, we look at in-licensing deals, we look at things that are synergistic to our company, that mean we don't have to add incremental costs that we think can drive the top line, but fit in with our infrastructure and maybe our therapy focus. We're working on that and we're working hard, and that requires relatively little capital. That will just grow as to the price tag that we can do going forward based on what Eli showed you. For me, I think we have a clear plan on business development. We're far more active than we've ever been, and we have a really big offering. One thing I remind people of, Teva is a global pharmaceutical company that is number one or two in many markets that we operate in. We have scale, we have knowledge within the channels, the reimbursement, pricing, supply chain. When people need a global pharmaceutical company to partner on something, there is no other company like Teva, because if it's global, it'll have a huge portfolio, it'll have many assets it's focusing on. I think we're gonna find people are gonna find Teva appealing with that regard, and that allows us to think about deals maybe slightly differently than others. The question about are we going to sell off legacy assets and things like that, you know, what we've tried to do in this strategic plan is put in place everything we control. We control everything in this plan is something we know we can execute, and we know what's going to be the financial impact. We haven't counted into this any divestments, any capital from divestments or any changes in that. We don't think that's the right way to go ahead. We have that flexibility going forward, but we only want to use that going forward as flexibility. We don't want to rely on it. I think that's constraining, and that maybe starts to reduce the credibility of the strategy. Elie, do you want to add anything else? No. I would just mention, you asked a question about, the mid-single digits growth, right? Yeah. Per question, it's embedded, business development deals inside. Yeah. Jason Gerberry from Bank of America. Thanks for taking my questions. Just on AUSTEDO, can you talk a little bit about the expansion here? You're basically kind of calling for 2027 to double your revenue off of kind of where you'd end up in 2023. How much of that is maybe taking share from your competitors on the XR profile versus sort of category expansion on the step up in selling and marketing investment for the overall category growth? A follow-up on the TL1A program and just sort of what the potency sort of may translate to in terms of clinical differentiation versus, say, Prometheus or Roivant. Mm-hmm. You know, it looks like Prometheus is a pretty safe, well-tolerated drug through the induction regimens. Do you think there's going to be additional safety liabilities that may be manifest in the maintenance phase? Do you just think that this is more of an efficacy play? Thanks. Let's start with the AUSTEDO. It was the AUSTEDO that you were asking about first, to double it to two. I'm glad everybody's got the $2.5 billion in their mind, at least based on the questions. To be clear, yes, we're gonna take market share from our competitor in Crescent. No question about that. It goes back to also that patient journey. We already generate a significant amount of scripts, as a conversion of those scripts into patients on therapy long term. There's work we can do around moving somebody from that and from the hardware, the prioritization and conversion, specialty pharmacies, many aspects which we haven't touched upon as a company, which are relatively standard when it comes to specialty medicine. We're applying new resources and new capability into that particular part of our business. We already generate a healthy amount of scripts. It's a question of converting more of those to allow patients to actually benefit. That's a significant opportunity. We have the opportunity of growing the amount of scripts we get in the market and competing better than we've done in the past against the other products in the market. That's another. Those two things together, along with compliance and adherence, I think drive significant growth. Then a DTC campaign, which we've done in the past, we know when we do that, it drives more awareness and more people into the physician's offices, which then translates into more opportunity for them to seek treatment. All those things together, you know, we carefully modeled this, and I'm confident that we get to $2.5 billion in 2027. Judging on coming from the launch meeting of the once a day, because once a day, if you look at the data and the market research, actually, that reminds me. AUSTEDO commands in the physician's mind, the psychiatrist's mind, a leading profile when it comes to efficacy, safety, and the ability to treat this condition. The one chink it had in its armor, the one missing piece of the puzzle was once a day, and we have that. The advantage, or the profile of our competitor was solely based on once a day, not those other attributes. Based on that, I think we've got now everything we need. It's about execution. The opportunity is there, and I think understanding where it needs to come from is there. We are confident about that. I, as I said, I just came from the launch meeting, if the enthusiasm, experience and knowledge we have of the field team in Teva USA is anything to go by, I'm confident we're gonna hit that $2.5 billion. On the TL1A? TL1A. You know, what I showed today was potency, selectivity, and, you know, we have safety at this point. I don't think, you know, you could argue those are the foundations of a good program. Every program I've ever worked on always wanted to have great potency. I think the selectivity is a big differentiator here because, you know, potency will give you benefits when it comes to key chain exposure. The selectivity here gives us a avenue of clearance, I believe. That is gonna be a really impact on, you know, the lasting effect of the activity. I think the safety, you know, what we've seen so far is very good. I think the lack or the low level of anti-drug antibodies is critical for longevity as well. I think the selectivity, and the ADAs are gonna be a real benefit for the long-term maintenance of response. Umer. I had a couple today, if I may. First, I think everybody's curious, the TL1A, is it a real TL1A? Have you been able to generate perhaps the competitor TL1A construct internally to try to do a head-to-head in some sort of preclinical model? Especially in the context of some patent filings suggesting on/off time could be very different for your TL1A versus the competitors. That's one. On the olanzapine, I was curious, sub-Q approach is obviously different than how Lilly attempted it with Relprevv. Mm-hmm. There is evidence suggesting accidental blood vessel injury could happen even with a sub-Q, not necessarily always with IV or IM. Could you speak to that? Finally, Eli, I saw that pie chart for 2027 R&D versus now, and the 2027 was bigger. I couldn't count how much bigger, but I assume about 40%, 50% bigger. Can you speak to that? Yeah. Okay. Do you wanna start with the TL1A? Yeah, I'll start with the TL1A. Unless it was some thinking time. No, no, it's okay. For the TL1A, yes, it's a real antibody. You know, we've been working on it for quite a long time. We were probably one of the first groups in the space. The antibody's been targeted and developed very specifically. From day one, it was designed to bind one single subunit of the trimer and to not block the clearance pathway through the decoy receptor. The potency is there. I think that we should make sure that we follow free TL1A levels. I kinda try to emphasize that today because, you know, if you have a separate clearance pathway, you have an option, you have the ability to remove cytokine from the system. If you're just accumulating bound TL1A, you're right, the on/off rate will be important for free TL1A. I think that's where this field is gonna go. We'll monitor this. We're gonna look at this in all our studies, and we're excited to see, you know, the potent effect of the drug. I'm confident in that. Getting on to the olanzapine LAI. Yes, there's vessels subcutaneously as well, Umer. I think I would also point to the fact that the copolymer is ingenious. When it hits an aqueous solution, it rapidly aggregates and forms capsules around the olanzapine. In the other formulations, they're more soluble when they're injected. Even if you hit potentially a vessel with our formulation, it'll aggregate rapidly and be trapped. We believe that we're actually very confident that this will not be seen. Eli, numbers? Yes. you got it right. It was a graphic illustration. I would say it will be relatively growing, according to our EBITDA expansion, which is around between 20%-40%. If I may just clarify, Richard, do you think TL1A is best developed in the hands of Teva, or would you wanna have a big immunology player? Less because of sharing R&D expense, but perhaps more because some big players are sitting with a lot of rebate dollars. A drug in your hand is worth 2x in the hands of someone who has a lot of rebate for the channel. Look, I think obviously there's a lot of excitement around TL1A, so everybody's talking about it and seems like everybody wants one. We fully funded as you highlighted there through the R&D and out the other end in our strategy to keep this in-house. Look, I've been part of launching products in the United States for a long time, and there are many challenges and opportunities to doing that. You know, the challenge you've mentioned there about rebate dollars, yeah, that's one. I've been part of organizations where that is also overcome, particularly if you have a best-in-class molecule. I think that's something right now we're focused on accelerating that through the clinic ourselves and getting it back to the market as soon as we can. Right. Thank you. Ash Verma from UBS. I had two, one was just on biosimilars. As we are looking some of the assets coming from your Alvotech partnership, what is kind of your commitment level to that partnership right now? We haven't seen the results from the perspective of what you might be expecting in terms of the approval timelines. In your contract, is there some terms around if you can walk out from that partnership, if you're not able to get what you wanted by the time that you wanted basically? That's the first question. Second one, on TL1A, another debate on this seems to be whether the antibody's binding the monomer and trimer or just the monomer alone. That's like one of the key discussion point between from Prometheus and Roivant. Anything that you can share on that would be great as well. Great. Thank you for the question. Yeah, we do remain very committed to the Alvotech partnership. Yeah, we think, you know, Alvotech has shown that they can research and develop, you know, biosimilars and bring them to the market as they've done in Europe. So we're very committed to that, and we remain so based on the assets we have with them. We're also committed to doing business development and expanding the portfolio with other partners as well, because our strategy is about being honest about size of portfolio. Our belief is that as their biosimilars take traction in the US, it's gonna be about bringing more and more to the market using our infrastructure that we have in place to do that. We're committed to the Alvotech partnership, but we'll also be looking for other partnerships to leverage our infrastructure and to also make sure we have that capital allocation. You know, we're obviously developing some of our biosimilars internally, but as has been pointed out by Umer and others, we have an R&D budget which is going up. We wanna be thoughtful about that and how do we allocate the right amount of resources to the right parts of our business. And partnering in biosimilars allows us to think about that thoughtfully. That's one of the approaches we'll be taking going forward. Your question about the monomer versus the trimer binding. It's actually very difficult to meet the monomer and show binding there. In general, that's a difficult experiment to do. You know, in our structural models, we do show clearly that we bind the single subunit of the trimer. That's in opposition to other molecules. We bind it. It's difficult to show whether you bind the free monomer in the experiments, but we have the potential to that because we're targeted to a single subunit. Thank you. Any more questions here on the floor? Okay, we got some questions we got by email from people who are attending the webcast. The first one, are there any plans for geography expansion as part of the new strategy? I suppose from a geographical expansion, that could be. There's a few layers to that question. I would say with regard to taking some of our portfolio to other geographies, yes. I think I mentioned with AUSTEDO, we want to take that into Europe, and we're looking at other geographical expansion. We continue to do that with AJOVY. We're looking at doing that with our pipeline. I know there's a lot of appetite for taking olanzapine into other markets around the world, particularly Europe. We're looking at doing that a bit more thoughtfully with our biosimilars. I think our biosimilars has been slightly fragmented in how we've approached that geographically. We want to do it globally, so we'll be doing that more going forward. There is geographical expansion within that. It tends to be more portfolio-based than going into another country as a whole. I think that would be something we'll do a lot less of, and it'll have to be a very, you know, thoughtful decision to actually move and set up an operation in another country, sorry. Okay. Another question we got is why are you keeping your two times debt to EBITDA? Does it make sense considering the new or the more aggressive BD strategy? I'll hand that one to Eli. I would comment on aggressive BD strategy. We haven't done any BD, I think starting to do BD, I probably wouldn't call it aggressive. I'd say we're starting to get back into the game, that's just a point of view. Over to Eli on the two times. Yes. thanks for the question. you know, we are in kind of inflection point trying to get, you know, below the four t imes on the EBITDA. If you look on the entire net debt on the $18.5 billion, it's around 4.5% embedded there in terms of interest that we need to pay the coupon to the bondholders, the entire debt, right? For the short term, it's even lower than that because those actually issued when we were investor grading. This is really about capital allocation question because we believe that in the next three years, we'll get down to the level of $15 billion, even below, with some more working capital enhancement. We'll have more cash a bit on our balance sheet. When we'll be able to have investor grade, we'll be more open to finance deals for BDs when our ratio is down. It's not making any sense to stop here at that point and run the company because it will be very, very expensive when you will take the work into any models that you want to acquire something. It will be very tough at that point. We are see ourself in the next several years keep reducing the debt, and by itself, it go below three as we move forward between three to four years from now. Thanks, Eli. Two questions. On TAPI, given that you guys are planning to kind of stand it up as a standalone business, is the plan eventually to spin or sell that? Can you just talk to that? 'Cause I think you mentioned that, from a margin perspective, it is accretive to Teva overall. My second question, you guys have mentioned, you know, sporadically that you expect to get back to investment grade over the next few years. Richard, from your perspective, is that kind of an explicit target or a goal for you? Or is it just something that you, Eli, think that should happen by virtue of deleveraging? Thank you. Yep, thanks for the questions. I think starting on TAPI, our main aim is to maximize this business. What we've realized through our strategic analysis of the organization, we've probably not done it any favors by keeping it under the sort of the arm of the broader Teva organization. If we make that standalone, it's going to grow. Going back to what our strategy is about, it's about Pivot to Growth. We think we're gonna be able to grow that business on the top and bottom line. It's already accretive on the bottom line, so if we can grow that, it helps us drive that financial, graph that I showed you. I think, you know, TAPI is a key element of our strategy going forward. You know, that's as it stands right now, we see that as an element we wanna maximize. Moving on to the investment grade. You're sort of putting me in a head-to-head with my CFO there, yeah. It's quite subtle, but I read that and I can see that stare. No, in all seriousness, the capital strategy is very clear. We see the benefits, as Eli said, of getting down to investment grade, particularly to allow us to do other things and finance other things going forward. I think the question is how quickly can we get there? One thing we probably don't talk enough about, but as we execute on the strategy, we are gonna grow the top line, and we're growing it in profitable areas of the business. That changes our EBITDA. That changes a lot of things about our ability to generate cash and pay down debt. I think, you know, that's probably something that we look at feel more optimistically about how long it's gonna take us to get to investment grade. In the short term, even if we stay on the same trajectory, we're still generating more cash, which allows us to do, you know, more deals anyway. We don't find it as a limitation. Probably before I hand over to Eli, we do believe that Teva needs to continue to get credibility for executing this plan and to paying down our debt. You know, I don't want to, in any way think because we developed a new strategy that gives us the freedom to come away from any commitments we've made in the past. We wanna stick to commitments because we think that is a credible thing to do, and that's important for us. It's, as we start to show we can execute the strategy, we're keeping up with the commitments we made in the past, then maybe that gives us some flexibility down the road. Until that happens, we'll continue to do what we said we were going to do. I don't know whether you want to add anything else. No, I'm just saying it's really, you know, when we look on the big picture with the $1 billion finance expenses, when you deleveraging three or so now you can be at a level of below $700 million. You take that $300 million, you fuel the business, right? We are in that inflection point that in the next three years, that's what will get us together. You know, we run so many models and how we, you know, what will be more accretive in terms of, you know, shareholder value and returns and so on. We still stick to that element and we see ourselves with deleveraging. Yeah. We got another question by email. Could you please elaborate if you have a target number in mind in terms of proceeds when it comes to portfolio optimization? On the portfolio optimization or on the generics powerhouse? Capital allocation, yeah. On removing some of our portfolio. I think he refers more to the capital allocation. All right. Okay. Yeah. If the question is about the entire portfolio optimization on the assets and the predicted proceeds. Okay. Yes. We have few scenarios in our modeling, but they are very, very, I would say, in kind of, early stage in terms of the timing, but we have a very clear picture on what we want to do and when we want to do it. It's already embedded in our planning to fuel our growth. Hi. Thank you. I have a question for Eli. You mentioned that as part of the focus on free cash flow generation, there's a focus on net working capital optimization. Can you provide some more color on, like, what Teva can achieve in that area? Do you have targets in terms of the working capital cycle days that, you know, you might be looking at here? Yes. Thanks for the question. You know, in the last, I would say three years ago, if you look on our balance sheet in terms of working capital allocation, you will see that it's ranging around 90% of our revenue. Like average working capital on annual revenue. We actually closed last year at a level of 15%, right? 1%, you multiply by the revenue, $150 million if you're able to. You know, if you look on our AP base, we are very, very, I would say, spread around the amount of vendors that we used to work. With the entire optimization and reducing the size, as you saw, with consolidating our supply chain, our procurement, we actually put a very, very strategic view on our working capital. Now the company is moving to a new chapter. We're also going very, I would say, aggressively on our contracting terms with how we actually source, and we see ourself actually. Our DPO, if you calculated from two years ago, went from 60 to 80 days. Now we're not stopping here. We're actually aiming to 120 days. There is a lot of activities that we're doing now with the fact that we're actually more, I would say, flexible on our ability to negotiate and to strengthen the business. It also goes to inventories and how we're actually shortening our lead times, our ability to make sure that our manufacturing, even internal Teva and outside and what we were sourcing to make sure that our lead time are really getting more short and our ability to convert it into commercial. A lot of activities around it. I would say, you know, it's like we aim to be somewhere in 27, very close to the 12%-13% I would say. We are now at the peak between 15%-16%. There is a lot of improvements there as well. Yeah. Hi. Thanks for the follow-up questions. Just a couple more on biosimilar Humira and also on BD. I think the value of biosimilar Humira for you with Alvotech lay in its interchangeable high concentrated version. With each month or quarter of delayed entry into the market, this value diminishes substantially. How much of a setback is this to your growth plans, especially in 2024 or even 2025? Your competitors are coming into the market with an interchangeable high concentrated version soon into late 2024 or so at the earliest, right? That's one. Second, on business development, could you also speak a bit more about your philosophy and approach towards it in terms of your focus on commercial or pre-commercial assets, early stage or late stage clinical assets, and the size of these deals that you're comfortable taking on? Thanks. Yeah. Thanks for those questions. On the Alvotech, on the biosimilar Humira, right at the study year, we risk adjusted that number in any way heavily. Your question was, does this significantly erode revenue the later it comes to the market? Absolutely. Yes, it does. Is that taken into account in our financial planning and forecasting? Yes, it is. We've risk adjusted that significantly going forward as well because of the uncertainty. That doesn't, I think the other part of your question, does that impact our ability to grow? No, it doesn't. That really reiterates the fact that we're a broad company with multiple of areas to drive our revenue. Biosimilar Humira, we would love to get to the market soon. Don't get me wrong. We really think we could do a great job with that. If that doesn't happen, that doesn't in any way impede our ability to return to growth mid-single digit. That's important to understand that. We also want to build out our pipeline of biosimilars, that ability to manage what will happen even if we launch all of them one time, we'll have years where we have more launches than other. Having more assets to do is a good strategy going forward. On the BD as a whole, what we're looking at now, right now is assets that will be able to generate revenue in the short term to medium term. We're looking at late-stage assets to in-license. That's what we're going after now. We will have a few early stage, whether they're preclinical or early clinical we're looking at, that could be interesting to the areas of expertise we're in. One, because they're lower value, but also we now want to make sure this pipeline is rejuvenated constantly as we bring things through. We want to complement what we're gonna do internally with external. The short term revenue generating in-license is definitely what we're going after. Early stage will be pre-clinical. As that goes later, we'll probably still be focused on revenue generating or close to the market phase II and phase III. That's how you should think about it. That's obviously as our balance sheet as we'll be able to maybe play in those areas which are a bit more expensive for some of those assets. In the short term, I would manage, you know, as you think about what type of assets we could in-license from a revenue, it will be slightly restricted by our balance sheet, but we wanna make sure it's synergistic and complementary to our infrastructure. From a cost base, we don't really have to change anything, and we can layer that on top of our commercial capabilities that we have. Thank you for the question. We have a question from Elliot Wilbur from Raymond James. He asks if you can please describe in more detail the strategy and any remaining decision points that need to be made with respect to pursuing potential approval for AUSTEDO in the EU. How important is it for the $2.5 billion target for 2027? We've planned out what we need to do to get AUSTEDO into the European market. Yeah, that's not straightforward. It's not gonna be every market we can get into immediately. Because of even approval, we've got reimbursement. Reimbursement is anywhere from, you know, a few months to a two and a half year timescale when it comes to Europe. Europe doesn't really figure heavily in the $2.5 billion because of that. That's something that's variable because get the approval first, and then it's a question of how we get that reimbursed, which as I said, can take some time, but it's not something we rely on heavily in the $2.5 billion. One more question from investors is about the generics. It appeared to be a bit flat on the chart that you showed. Can you explain the dynamics in within the different geographies there? Yes. If I break it down, it's sort of a continuation of where we are now, which is European international markets tend to grow mid to high single-digit. Obviously, that's in local currency, so we tend to sometimes suffer from the currency headwinds when it comes to putting that in $. The U.S., the aim is as we go through this more targeted and focused approach, making sure we can drive these complex generics to the market more successfully. The aim is for that to be able to become more consistent and back to growth. That's something we have to prove we can do. Right now, you know, the U.S. generics business is more stable, but that's always gonna be reliant upon how many products we bring to the market. That's why you've seen us not lean heavily into that generics business on that bar chart, because I think that would be unreasonable until we've executed that part of the strategy. Okay, one more from the web custodians. What's the progress of the growth, revenue growth, of the 5% CAGR? Is it everywhere towards the end of the period, or it's more like, spread around the five-year period? Asking whether it's a hockey stick. No, I think the growth, and Eli, you can touch upon this. It's actually, and that's another thing that gives us a lot of confidence. A significant amount of this growth is coming from products we have. We have AUSTEDO, we have AJOVY, and we have UZEDY in our pipeline now and have just been launched. UZEDY's just been launched this week. AUSTEDO XR has just been launched this week. That's what I'm very excited about. We have assets that in areas, in therapy areas we know a lot about. We have great commercial capability behind it. Those are gonna drive growth. I think of that as, you know, pretty linear. I don't know if Eli wants to give any more flavor to that. Obviously, one thing that's important to understand is I do think AUSTEDO has the ability to grow and UZEDY grow to beyond this, through this time period, the short-term time period of 27. We'll have the launch of olanzapine and ICS/ Saba. I feel we're very well-positioned on some near-term growth drivers, which have a line of sight, and we know what we have to do, and some midterm growth drivers, which are olanzapine and ICS /Saba. Which as Eric mentioned in his presentation, you know, a relatively de-risked ICS/ Saba because we know those drugs are well-characterized, and olanzapine because of what Eric said about understanding our route of administration. I think of it as, think of it as more of a linear, and the BD, just to give some clarity on what Eli said, it is included in there. We include that more in the, the latter period, so 25 onwards. We're not reliant on doing that really quickly because of the growth drivers we already have. Do you guys still expect to have first to file for Xifaxan? Maybe Eric, is that... How are you thinking about that in terms of factoring into your later growth, outlook? Yeah. I don't know the specifics on Xifaxan, one of the things we are focusing on is the fact that we are increasing our proportion of all our products that we do in generics as a first to file better. That increase, just the incremental benefit we get from that is gonna be, I think, realized in the near future. Okay. Well, look, I believe we've taken all the questions here and from the floor, we've taken the majority of them, all of them from online. I just wanna close by thanking everybody for coming here today, for tuning in online. Really appreciate your level of interest. Hopefully, you found this informative and educational. As we move forward with the strategy, we'll give you updates on a regular basis, how we're executing on it. Hopefully, you will see what we believe we'll see, which is pivoting Teva back to growth. Thank you.