And we expect it to occur throughout at least the first half of 2024. We’re not seeing any incremental inflation in, I’ll call it, current activity. So it’s not being additive to inventory, but it’s also not subsiding either. So we’re kind of at a new, I’d say water level, if you will, that should be going forward, but not hurting the P&L as we look out beyond the second half of 2024.
Operator: Thank you. Next question is coming from Shagun Singh from RBC Capital Markets. Your line is now live.
Shagun Singh: Great. Thank you so much. I was just wondering, if we could get your latest thoughts on the potential impact of Novo’s osteoarthritis data on orthopedic utilization, given the focus on WOMAC or pain scores. I believe the presentation could be here soon. Just curious to hear your thoughts and also what kind of scores could or may not have a potential impact? Thank you for taking the question.
Joaquin Duato: So overall, look, osteoarthritis is a contributor to knee surgery. Sometimes I’m asked about osteoarthritis in the context of the GLP-1s, and weight is not a factor in osteoarthritis. We continue to look at this data, and it’s early for us to give you an answer there. Now what we can tell you is that we continue to see an increased volume of procedures in orthopedics based on coming out of COVID. And we don’t see any change in that neither in the hips or in the knee area or in any of the segments that we compete. So we are optimistic about our orthopedics trajectory. Specifically we are optimistic about how we are progressing with our VELYS robotic system for total knee replacement. We have already have 30,000 procedures with very positive feedback from the surgeons, especially in the ambulatory surgical centers.
We are working to submit our 510(k) for our VELYS unique knee application. And we are seeing a strong recovery also in our hip business with a combination of new products like ACTIS, KINCISE and VELYS hip navigation. So we feel good about our orthopedics business as we continue to see global procedure recovery in most markets. We continue to succeed with our new products, and we love also part of the headwind that we had in China during this year. So very positive outlook moving forward for our orthopedics business.
Joseph Wolk: And Shagun, it’s also important to maybe provide us a reminder what we commented to last quarter, and that’s — we’re looking very hard at improving the profitability of the orthopedics unit, so being very selective as to what geographies we play in and what SKUs are actually going to be offered. So not only will you see some of the strength in the top line, as Joaquin outlined, but you should see an improved margin profile for that business as well.
Operator: Thank you. Our next question today is coming from Vamil Divan from Guggenheim Securities. Your line is now live.
Vamil Divan: Great. Thanks so much for taking my questions.. So just maybe an area we don’t spend as much time on is on the respiratory side, specifically, PAH. But just sort of a two-part question, but that franchise of yours continue to sort of outperform expectations. So curious, if you can talk about sort of what’s driving success there? There’s also an area where you don’t have a lot of sort of longer-term investment. So going back to sort of the business development question, I’m just curious in your interest in sort of PAH or respiratory more generally as an area, further focus given your key franchises are going to be going away, but you do have the infrastructure there already?
Joaquin Duato: So first, let me underline the great results of our PAH franchise in 2023. We had growth in the high-teens driven by improved patient mix, market growth coming out of COVID too. This was an area that was heavily impacted by COVID as pulmonologists were working at COVID and not diagnosing new patients. So overall, it’s been a very positive trajectory of our PAH business, and we remain confident about the short-term future of this business into 2024. We are working towards the combination of macitentan, OPSUMIT with Tadalafil, which the trademark will be OPSYNVI. And that would be another option for patients there to enhance compliance. And in my talks with physicians treating pulmonary hypertension, they seem very positive about it, and we expect an approval of that combination in 2024.
So that’s the outlook for our pulmonary franchise. Are we looking at other areas there? There, we are looking at the space and see if there are potential opportunities to be able to improve the standard of care. And we continue to look to see how we can continue to extend the success of our pulmonary franchise into the future. But overall, we’re very happy with the trajectory of our pulmonary franchise in 2023. And we expect a similar trajectory as macitentan, OPSUMIT and Tadalafil (ph) become standard of care clearly established in this area.
Operator: Thank you. Next question today is coming from Louise Chen from Cantor Fitzgerald. Your line is now live.
Louise Chen: Hi. Thank you for taking my question here. I just wanted to ask you with respect to your oncology franchise. Do you have any thoughts on CAR-Ts for autoimmune disease at all? And then secondly, radiopharmaceutical?
Joaquin Duato: So thank you, Louise and we have a strong oncology franchise in different areas. I commented that here in prostate cancer with ERLEADA that I discussed before. We’ll see data in high risk localized prostate cancer in 2024 with the addition of Ambrx now and antibody drug conjugate in this area. We are very, very excited about RYBREVANT and the combination of RYBREVANT plus lazertinib. We have Phase 3 studies completed. We expect — we have filed all the three indications, and we expect approval of that in 2024. So we are very excited about RYBREVANT and the combination of RYBREVANT plus lazertinib in EGFR-mutated non-small cell lung cancer in first line. Moving into bladder cancer. You also will see data with TARIS-200, and TARIS-210 in non-muscle invasive localized bladder cancer.
