Richard Francis: Yeah. No, so around interchangeability, I think this is something that’s being discussed, but it actually hasn’t been concluded. So, it’s been proposed, but it has — it needs to go to and it requires legislation to change for this to happen. So, I think this — I’d say, let’s see how this plays out. Obviously, when it comes to substitution and allowing biosimilars to have a fast-track uptake for patients and payers in society, we would support that. But there’s a long way to go. So, I think this is just in its embryonic stage, and we’ll have to see how that plays out. And as there’s more clarity, I’ll update you on subsequent calls.
Yifeng Liu: All right. Thanks very much.
Richard Francis: Thanks for your call.
Operator: Our next question comes from Thibault Boutherin of Morgan Stanley. Your line is now open. Please go ahead.
Thibault Boutherin: Yes. Thank you. So, three questions. The first one, just a quick follow-up on biosimilars long term and your in-house pipeline. You mentioned the change in dynamics and how things are opening up for biosimilars. Is that changing in any way your willingness to invest in the kind of next generation of pipeline asset that you’re developing internally? Second question, just on the olanzapine and market potential, I mean, I think you gave in the past kind of $400 million to $800 million potential for UZEDY. And given the broad use of olanzapine and clearly your excitement on the asset, is it fair to think about blockbuster potential for olanzapine injectable? And last question, just on the reduction in the number of sites. We saw interest in the industry for biologic capacity elsewhere. So, is there an opportunity for you to potentially divest these sites or monetize these sites reduction exercise, or is it just expected site closures? Thank you.
Richard Francis: Okay. Thank you, Thibault. Thank you for those questions. So, let me start with the first one, the biosimilar one. I think it was around capital allocation. Do you see the change in dynamics mean that we would invest more in internal development? I think first and foremost, capital allocation occurs when we partner as well. So obviously, we — it’s a lot less than when we do it internally, but I just want to make sure you’re aware that we do allocate capital to our pipeline that is partnered, but it’s less. I think we’re in a very fortunate position at Teva because of the makeup of our business. And as you’ve seen from the innovative pipeline that we have that allocating capital to this and accelerating this through the clinic, I think really drives potential to bring life-changing medicines to the market, but also helps us drive value for shareholders.
So, I think, we’re always talking about our capital allocation. We take that into account as things change in our business, but I see nothing that creates a sizable shift in the strategy we have right now. Then, I think you moved on to olanzapine and what’s our prediction around this and could this be a blockbuster. Look, I go back to start where there’s clearly an unmet medical need there. There’s no long-acting olanzapine as we’ve seen in the data and clearly a big percentage of patients would benefit from a long-acting olanzapine and we get the same feedback from healthcare physicians, which is one of the reasons why I think the study was so well recruited because people wanted to be part of it. I think when it comes down to giving guidance, obviously, we want to do a bit of work in understanding the dynamics of the environment and we will come back and maybe give some bookends up to that later, as we’ve done with AUSTEDO in the past.
So, it’s something which we’re open to do, but we want to give that more time and obviously we wanted to get the safety and efficacy readout under our belts before we started to do that. With regards to divestment of sites and monetizing that, first I’d say we’ve always done that. Teva runs very good sites and the fact that we’re reducing our sites is more about our strategy, not about the quality of those sites, the quality of the people who operate in those sites. And so, on a regular occurrence, we divest and we sell our sites and people find them very attractive. I think obviously, you’re talking about the changing environment around biologics and capacity. And so that’s something that may make manufacturing sites easier to sell, but we’ll see how that plays out over the next few years.
Hopefully that answers all your questions, Thibault. Thank you for them, and appreciate the interest.
Thibault Boutherin: Yeah. Perfect. Thank you.
Operator: Our next question comes from Chris Schott of JPMorgan. Your line is now open. Please go ahead.
Chris Schott: Great. Thanks very much. Just two questions for me. I mean, first, just on the International Markets, and just a two piece here. Can you just elaborate particularly what markets are driving the healthy growth we’re seeing here as you just think about that business as a whole? And I think as part of the prepared remarks, you talked about the Japanese generic business that you’re divesting, and just give us some sense of how large and the growth profile of that piece? And then, my second question was just coming back to TL1A. I kind of hear you in terms of the need for broad therapies given the unmet need in this space, but it does seem like a number of the KOLs we speak to are also excited about potential for a biomarker-driven approach to help better identify patients.
So, I guess, sort of to get my hands around, do you see the biomarker piece as something that’s kind of secondary and that the studies will be kind of broad all comers and that you’ll kind of see how the biomarker sorts out? Or do you see there’s a potential to differentiate on biomarkers? Because again, I’m just — I’m trying to balance that out of like kind of entrenched therapies, people want something that’s a little bit different versus still again a lot of unmet need here. Thanks so much.
Richard Francis: Hi, Chris. Thanks for the questions. So, with regard to your two on International Markets, actually, the encouraging thing about International Markets is we have growth across all of them. And we’ve had growth across all of them for the time I’ve been here. A credit to the team and the quality of the team. We have done a bit of focus on investing capital and resources more specifically and I think that’s really helped International Markets. But there’s not one that stands out and I think that’s why we’re delivering consistent quarter-on-quarter growth in International Markets because of that. That’s first. Just to — with regard to the Japanese business, we’re not stepping out of Japan. We’re divesting part of our generics business.
And that goes back to, once again, to our capital allocation where we can make sure we’re giving capital where we can generate a good return. And we have the ability to be thoughtful about that at Teva because of our scope in geographies and businesses we have. So that’s how that plays out in Japan. And now with TL1A, I’ll hand that over to Eric to answer.
Eric Hughes: Yeah. Thank you for the question about biomarkers and TL1A. So, there’s a number of important things to consider when you’re talking about biomarkers. For one thing, in my experience with biologics and discovery of biomarkers, it does take large numbers of patients to really understand and be confident in biomarkers’ effect. To date, we haven’t seen significant delta based on biomarkers. I’d like to see much bigger delta based on many more patients. But certainly, it’s possible to identify biomarkers that are predictive of response at baseline, and more importantly, you can find strong ones that are predictive on treatment. So, we’re focused on speed. We’re focused on making sure that people have options for these patients.
Like we said, these patients cycle through treatments for ulcerative colitis and Crohn’s disease and they need options that last. So, I don’t want to disabuse patients of a possible treatment choice in the future. So the choice, we’ll always look for these biomarkers, but it’s going to take much more data than we have today.
Richard Francis: Thanks, Eric. Thanks for the questions, Chris.
Operator: Thank you. Our final question comes from Glen Santangelo from Jefferies. Your line is now open. Please go ahead.
Glen Santangelo: Yeah. Thanks for taking my question. Hey, Richard, I just want to shift gears for a second. In your prepared remarks, it kind of seemed like you were incrementally excited to talk about the generics business this quarter. And when you look at the results, obviously, solid growth across all your geographies. Maybe could you just give us a little bit more details maybe about product launches that maybe driving that growth and how we should think about maybe organic volumes in that business and pricing just so to help us assess the durability of these recent trends? And maybe as my follow-up, I’d ask about Revlimid specifically. I know that created some volatility in the results in 3Q and 4Q last year based on your contracts for that business. And so, I was curious if you could just give us an update there as well. Thanks.
Richard Francis: Okay. Thanks for the question, Glen. I suppose I can’t hide my excitement. And look, what’s behind it? And I appreciate the question. So, I think I said at the outset when I arrived here about the generics business at Teva having all the components to be a great business, which is why we use sustainable powerhouse as a pillar, pillar three of our strategy. But that is not shying away from committing to something by calling it a powerhouse. The reason why we could do that is we have an extensive pipeline of generics at Teva. We have a great high-quality manufacturing footprint and we have great go-to-market model. The reality was not all of those are working in perfect harmony and they’re still not, to be honest, but we’re making big progress.
And I think some of that comes down to new product launches that you’ve seen in Q4, that you’ve seen this year and you will see more this year. Hopefully, we don’t always rely on some other people to give us approval for those. That’s one. And the second thing on our supply chain, our supply chain is becoming more efficient and more able to deliver what is an ever-increasing demand. So, those are the things that make me excited. I don’t think this is a linear projection. We’re doing some hard work to make this happen. And I think each year we’ll get better and better and better, but we have the ingredients. And for me, this was the quarter that we started to see some of those things come together. And I don’t think it will be, as I said, a clear path.
To your second about Revlimid, as you know we don’t split out product sales. But I think Revlimid is a good example of the fact that when we get it right in R&D, when we get it right in our approach into the market first, we can maximize an asset. So, I think that is something which we’re benefiting from this year, but we’re also benefiting from some of our other launches that we’ve talked about on other calls. So, thanks, Glen. Thanks for your question and I appreciate it.
Glen Santangelo: Okay. Thank you.
Richard Francis: Okay. Thank you for everybody. I think the time is up now. I’d like to thank everybody for their participation and their interest in Teva Pharmaceuticals. I look forward to giving you an update for quarter two later in the year. Thank you.
Operator: Thank you all for joining today’s call. You may now disconnect your lines.
