Patrik Jonsson: Yes. Thank you very much, Chris. I think you’re right. It’s quite challenging. It’s still early days with both Mounjaro in particular Zepbound, and we have been facing some specific dynamics in terms of supply and also changes to the co-pay program. However, when we look at the recent data for Mounjaro, it’s encouraging and it suggests that patients that start therapy back in Q1 2023 are having a persistency at least along the lines of other injectable Incretins. For Zepbound, definitely too early. But we strongly believe that patients will be motivated when they see the benefits of the drug. And there will, of course, be many factors impacting both supply, macroeconomic and microeconomic, but we are convinced that there will be a final duration of treatment also for obesity since when we look into even [indiscernible] in Type 2 diabetes, more than a 12-month period of adherence is considered long.
But encouraging data in Type 2 diabetes so far. And with Zepbound, we will see, that will for sure be an end of duration based upon what we have seen in other chronic diseases, but we believe that the features itself will be motivating for patients.
Operator: The next question is coming from Akash Tewari from Jefferies. Akash, your line is live.
Akash Tewari: So David, at JPMorgan, you made an interesting comment on orforglipron, where you mentioned the molecule has lots to prove here. Can you elaborate a bit on what you mean by this? And what’s your confidence on orfo’s CDI profile? It seems to have a bit of CYP3A4 inhibition. So will this drug be able to get dosed with SGLT2s, given they were excluded in some of your earlier studies?
David Ricks: I would frame like why I said that, but maybe Specific DDI question in the SGLT2 coadministration. I just said that because we’re just starting the Phase III. And we all know small molecule, there’s a bit of empiricism in terms of eliminating safety risk. And of course, every day, as we expose more patients to the drug and we have higher doses, that’s a good day where we don’t announce that the drug has a problem. At some point, we reached a lot of confidence. We just weren’t at that point. We’re not at it now. I think we’re running the Phase III experiment and we need to discharge the off-target safety that is inherent in small molecule discovery, and we’ve seen in this class from others. But nothing specific on my mind. Maybe Dan can further reassure us.
Daniel Skovronsky: Yes. Dave, of course, that’s just the normal Phase III types of risk, new safety signals, which could always arise. I think with respect to DDI and coadministration with SGLT2s, we expect that to be possible, and we have that ongoing in our Phase III trials. There are patients who achieve — will be just with our base for orforglipron as well as other drugs like SGLT2s.
Operator: The next question is from Trung Huynh from UBS. Trung, your line is live.
Trung Huynh: Can I just ask your thoughts on GIP agonism versus antagonism, given data yesterday from a competitor suggesting more limited effects on things like blood pressure and lipid modifications. Just how differentiated do you think an agonism approach is versus antagonism and why you think agonism is the way forward?
Joe Fletcher: Dan?
Daniel Skovronsky: Yes. Well, first of all, it’s an unfair comparison. We have so much data now on the benefits of GIP agonism from tens of thousands of participants in randomized clinical trials for Tirzepatide. So we’re extremely confident here about the benefits of GIP agonism. Adding to that data, we have experimented with a pure GIP one agonist that doesn’t have any GLP-1 and we reported the benefits there in our Phase I study. We’re contrasting that here to a small Phase I study that was recently published with a drug that has both GLP-1 agonism and GIP antagonism. I noted in that publication, the GIP antagonism is at a much lower affinity. So it probably only starts to antagonize GIP at very high doses. It’s probably a question for that company.
But I noted at the high doses actually an increase in free fatty acids and complete attenuation of the decrease in triglycerides in the clinical trial. Those are some effects that we attribute to GIP. And so I’m not surprised that antagonism of GIP is starting to have some negative effects once that kicks in. We also see GIP agonism as having positive benefits on tolerability, reducing potentially nausea and vomiting. Then again, I think maybe at the higher doses, you could probably see some hints of the opposite effect with antagonism. So pretty glad with the decision we took, and let’s see how the field continues to evolve.
Operator: The next question is from Carter Gould from Barclays. Carter, your line is live.
Carter Gould: I guess over the prior two earnings calls, there have been at least an acknowledgment that CMOs were going to be part of the equation going forward for supply on the Incretin side. I guess, does the development fee yesterday have any sort of direct or indirect impacts as you think about that part of the equation going forward?
Joe Fletcher: Thanks, Carter. Anat, do you want to field that?
Anat Ashkenazi: Sure. So we’ve, and I’ve mentioned on this call as well that we have very expensive expansion agenda, which does include third parties. While our strategy is and has always been to develop more internally, we do have third parties as well. So we saw the announcement that came out from NOVO yesterday regarding the intent to acquire Catalent. And we certainly have questions about that transaction and need to learn more. And we don’t know, Catalent is an integral part or a manufacturer of both commercial and pipeline products for the industry especially in diabetes and obesity, and we have products with these sites as well. So our focus today is on ensuring that the continuity of supply of medicine for patients is uninterrupted as well as we intend on holding Catalent accountable to their contract with us as we look and we gain more information on this proposed transaction.
Operator: The next question is coming from James Shin from Deutsche Bank. James, your line is live.
James Shin: I just want to circle back to Carter’s question. Given Lilly is well-capitalized and manufacturing capacity being the priority, I mean, could you expect more buy versus build to get around some of the technical bottlenecks and the nontrivial FDA process? I just want to get your thoughts there.
Joe Fletcher: Dave?
David Ricks: Yes, maybe I’ll give it a shot. Thanks for the question, James. As I mentioned on the earlier question related to Orforglipron, we are not — we don’t think of ourselves as capital-constrained, buying or building in the space. The reality is there just isn’t built capacity that’s available. Most of it that’s being used is already deployed against the leading products in the GLP-1 space, at least any at scale and new capacity has a lead time of three to four years. So all of the things that are coming online now, like we mentioned today, are very large site in Concord, North Carolina. That’s a big node of capacity for the sector and certainly for Lilly. I mean, that was announced two and a half years ago and it will just begin production at the end of this year.
So that’s the problem. And why is that? Well, of course, greenfield building is difficult, repurposing is difficult, but also these are technically complex facilities. There’s not an infinite number of people who know how to set them up. And the supply chain for the machines that make the products is also constrained. So at this point, I don’t think there’s an easy way forward. And I think even in yesterday’s announcements, we have a lot of questions about that. But I think even the purchaser or our competitors said it will take many years for them to be able to increase capacity within that purchase. So it’s just not an easy problem to solve. I think that over time, it will ease. There’ll be more capacity brought online by us, our competitor and maybe others, including third parties and new technology will emerge like Orforglipron or other oral options, that tap into a different asset base.
So I know it’s frustrating for investors, it’s frustrating for us. It’s even more frustrating for patients but it’s just sort of the situation we’re in is that we steady gains in manufacturing over the coming several years and perhaps bigger gains after that.
Joe Fletcher: Thank you, Dave. Our next question?
Operator: The next question is from Rajesh Kumar from HSBC. Rajesh, your line is live.
Rajesh Kumar: Hi there. Can you give us some color on, you know, how the access with employers is playing out? Are you getting exclusive access for your drugs or you’re being added to the existing access your competitors’ drugs have? And what is the nature of discussion, especially given that, you know, the pound is priced at a more attractive list price? I’m assuming with rebate, the differences might be a bit smaller, but any color there might be super helpful.
Joe Fletcher: Yeah. Thanks, Rajesh. I think we covered that in Chris Schott’s question earlier. I don’t know if Patrick has anything to add or if we could just move on.
Patrik Jonsson: I think the only addition would be that we are always aiming for open access. We believe that’s important for the providers and the patients we are serving. So that’s going to be our aim when it comes to employer opt-in as well. And we believe a move by pricing set down 22% below the competition, despite launching with a best-in-class profile, is also a good signal for increased and enhanced employer opt-in.
Joe Fletcher: Thank you, Patrick. Paul, next question. We have time for maybe two more. Next question?
Operator: Certainly. The next question is from Andrew Baum from Citi. Andrew, your line is live.
