[Abrupt Start] ...I haven't met before. I cover Novo Nordisk for Goldman Sachs based out of the European offices in London. It's pleasure to have the Novo team here; Mads, Peter, Karsten, thank you for joining us. I'm going to pass this straight over to Karsten to make some opening comments, and then we'll go to Mads, and then do Q&A from there. Karsten, all yours. Karsten Munk Knudsen - Novo Nordisk A/S: Thank you, Keyur, and thank you to Goldman Sachs for hosting this Q1 lunch meeting for the Novo Nordisk call results and it's good to see all of you. And we brought a presentation pack for today, and we'll go through that reasonably fast, and then we'll take Q&A from there. Forward-looking statements, I think you've seen this before. The future is uncertain and we have no chance to change that. So that's what we'll continue to live with. In terms of highlights for the first three months of 2018, then we reported what we believe is a solid first quarter in terms of results. So we reported a underlying sales growth in local currencies up 5%, which was driven predominantly by International Operations with 70% share of growth and North America with 30% share of growth. It is worth noting that the 5% online sales growth had a positive impact from timing of a Brazilian NovoSeven tender shipment that impacted the quarter by around 1 percentage point in terms of global sales positively. In terms of our operating profit, then the 5% sales growth turned into 6% operating profit growth, also measured in local currencies. We did have a one-off impact from sale of shares, sale of 2 million shares in NNIT, an associated company with a gain of some DKK 122 million corresponding to a…

Okay. Thank you. It's Michael Leuchten at UBS. Two questions please. One for, Karsten, just going back to your gross margin, if I think about the sort of products that I think are high margin products, you don't have Ozempic in that, that's now been launched. You have price declines in the basal insulin. Yet you have an underlying flat gross margin. How do I think about that mix for the rest of the year and then also going forward? Because previously the commentary was do expect some pressure on the gross margin and I'm not seeing that in a quarter where I would have thought to see some pressure. And then a question for Mads. We've seen some interesting data coming out of the EASL on fibrosis in NASH. The data suggests that you can maybe treat fibrosis a bit better than previously. Does that mean that GLP-1s could actually have a role later in NASH? Your commentary previously has been that the GLP-1s would have to sit in the earlier stages of NASH? Karsten Munk Knudsen - Novo Nordisk A/S: So I will start out responding to the gross margin question. So when we dissect our gross margin devolvement then it's basically a price, productivity and product mix. The pricing impacts will be there for the full year, then you can say there might be some phasing you know on the details because recall we had an adjustment in the fourth quarter of last year, so there might be something between the quarters. But fundamentally we'll see the pricing impact for the full year linked to the U.S. price developments. Productivity, we should also see for the full year and the same for mix. So mix, it's Victoza, it's Saxenda and Tresiba being what has kind of you…

Keyur Parekh from Goldman Sachs. Karsten, do you want to just clarify, there was a lot of confusion yesterday on your comments about the outlook for the basal insulin market. So, can you just clarify, do you expect basal insulin segment for Novo to grow in the U.S. this year? That's one. Do you expect it to grow globally? That's two. And then any commentary on longer term trends for the basal insulin franchise? Karsten Munk Knudsen - Novo Nordisk A/S: Yeah. Thanks for that question and clarification, Keyur. So, when we look at our first quarter results, then in local currencies basal insulin sales are down 3% globally. That covers a 13% growth in International Operations and a 10% decline in U.S. So, if we take International Operations first, we have solid momentum on our basal insulin franchise and the continued penetration behind Tresiba, but also start to find some countries for instance in France where Xultophy is penetrating strongly, so continued momentum in the basal franchise outside the U.S. In the U.S., the 10% decline there has to be seen in the light of the slide that – let me just click back to the market share slide that we have here. So when you look at that slide this dark blue line the market share development in the basal segment in the U.S. then we see a solid momentum in terms of gaining market share in the basal segments. That the main drivers behind that are twofold, one it's of course launching Tresiba, penetrating into the marketplace, so having the latest generation basal insulins with the benefits associated with Tresiba being recognized in the marketplace, so that's one. And then two, from a market share perspective, then the formulary changes that has happened over the last couple…

Simon Baker from Exane. Two questions. Firstly, for Karsten. You said yesterday on the call that the 2019 impact from the shrinking of the donut hole was about 1% to 2% of group sales, which is about $200 million to $400 million. The Congressional Budget Office estimates the benefit from the government of that 20% shift from them to you as an industry is about $400 million, which would suggest either that estimate underestimates the cost to industry or your estimate is on the high side. So, I'm wondering if you can give us some view or thoughts on how you arrived at your 1% to 2% estimate. And then a question for Mads, one of the hot topics across the industry at the moment is gene therapy. I'm just wondering if you could give us your updated thoughts on where we stand from a diabetes point of view with gene therapy, where Novo stands, the approaches we've seen data on this year in pre-clinical stage on things like alpha cell reprogramming. Karsten Munk Knudsen - Novo Nordisk A/S: Good. So in terms of the impact from the changed regulation regarding to the donut hole and the pharmacy of that, then I've been around this kind of technical calculation for quite some time, because the coverage in the donut hole was implemented as part of Obamacare back in 2010. So that is where pharma was told to cover 50% of the donut hole. So the way for us to kind of – I understand your data discrepancy and I'm not going to comment on how the other side has calculated that, but just to give you a couple of data points in terms of supporting facts on how to assess it on our side. So first of all you can…

Hi, Wimal Kapadia of Bernstein. So if I look at the realized price for Levemir for 1Q 2018, and I compare it versus the full year for 2017, on a per unit basis is down 19%. And if I adjust Tresiba for the one-offs, rebates and uncontracted volumes, it's also down 19% versus the full year of 2017. Is minus 19% a fair reflection for the rest of the year in the basal market? And then the second question is for Mads. If I think about oral sema and comparing it versus the SGLT-2s, how should I think about what the key – the most important characteristics are? So if I had to rank HbA1c, weight loss and tolerability, how important are each of those, how would you rank those? Because I guess the number one question we had post the PIONEER 1 data was that the weight loss didn't look that great. So is that the third of the three in importance? Thanks. Karsten Munk Knudsen - Novo Nordisk A/S: U.S. basal insulin segment pricing. So first, you know when you combine TRx data from HV or (00:39:57) Symphony Health with ex-factory data, then of course there are quite some steps in between and some uncertainty. So doing that analysis you always have to take that just with a grain of salt. So you know it is directionally correct what you're getting at with the size. We're not commenting specifically on realized price in specific segment, but it's directionally correct. Do bear in mind that for Tresiba, we have two effects that we just need to adjust for the Q4, and the non-contracted business. So that's why if you take the total basal business being down 10% in the U.S., then adjust for these special items, then in the…

Thank you. Sachin Jain from Bank of America, a few questions please. Firstly, just to follow up on the oral sema weight discussion, if I may. If I understood it correctly, we're referencing a different time points versus the data we're seeing for PIONEER 1. So can I just confirm the primary endpoint on weight as of 52 weeks not the A1c 26 weeks just to make sure I understand that correctly. And then for A1c, we typically think of a delta sort of 0.3%, 0.4% is the total non-inferiority margin. Any color on what you would view as clinically relevant as a weight difference as you power the study? And second question on the short-acting insulin franchise as we head into next year. Sanofi talking on their call that they've entered contracting for 2019. So any early color on what pressure we should expect there and you remain of the view that they should be different from the basal dynamics that we've seen. And then the final question is on the oral sema yield enhancement program, and I know you've talked about this at a very high level of a CMD. But just any color over the next two years, what level of yield enhancements you're targeting? How you're going to measure that and what communication we can expect on that? Thank you. Mads Krogsgaard Thomsen - Novo Nordisk A/S: Yeah. Karsten Munk Knudsen - Novo Nordisk A/S: So, Mads, do you want to start out? Mads Krogsgaard Thomsen - Novo Nordisk A/S: Okay. So Sachin, when it comes to the primary endpoint, the hemoglobin A1c, I think you may well argue that doing a study for 52 weeks, there are good arguments in favor of using a 52-week cut off, but these are also negotiations with the regulatory agency. And in that regard, they typically do a 26-week read out for A1c outcomes. And our statisticians as they looked into this, also had mostly data on the other OADs after 26 weeks, we had 26-week data after our own Phase 2 program, the one that was published in The Journal of the American Medical Association. So I think that's what we've powered it up against and are measuring on. In terms of the difference we need to see, well, we actually believe and again here the guidance is a little bit, you can say, not easy to understand, because sometimes agencies talk about 0.3% as you state, sometimes 0.4%. Clinically speaking, anything greater than 0.3% is of clinical significance is the view of most physicians I have spoken to and that does mean the power we have is strong, around 90% to detect even an 0.3% difference.

Weight at 26 weeks or at 52? Because I think the answer to Wimal's question was, you're confident on SGLT-2 weight differentiation given duration of trial. So is the weight endpoint at 52 or 26, and so weight delta not the A1c. Mads Krogsgaard Thomsen - Novo Nordisk A/S: Yeah. So, Sachin, in the publications we're going to issue, we will have the weight curves and statistical comparisons at week 52, so you will get the absolute difference and relative difference at week 52. In the hierarchical testing, do you remember, Peter, is it 26 or – yeah. So it's both the primary and the preferred secondary that is 26, but this is due to a regulatory discussion, that they prefer this. Doesn't mean to say that when you publish this and present it, the full year data and will payers – payers typically like to see at least one year data, because it gives them more about the durability. So doing 52 week studies are critically important for market access and for health economic outcomes and for quality of life and so on. But in the regulatory label it's defined as 26 in dialog with the agencies. Karsten Munk Knudsen - Novo Nordisk A/S: Okay. So then in terms of the short-acting contracting space for 2019, we are in negotiations for 2019 now. So providing too detailed comments for how things are would not necessarily be conducive for our own negotiating positions with the payer. I think the key difference between the basal and short-acting segment is that the short-acting segment has pretty much gone exclusive already. So from a negotiations point of view, for – it's one of our exclusive contracts that Admelog should then display NovoLog in the U.S. – on the U.S. formulary next year. Then…

Thank you. (01:01:54) from Morgan Stanley. Just a couple of question on your pipeline asset Concizumab for hemophilia. Can you just confirm that the Explorer 4 and 5 studies will be pivotal, and as well what are your expectations for this product? So (01:02:12) daily in a context where we're probably going to have HEMLIBRA approved on next year in both the patient population. So what kind of specific patient population or specific situation do you expect this product to be mostly used? Mads Krogsgaard Thomsen - Novo Nordisk A/S: Okay. Well, first of all, these are actually Phase 2 proof-of-concept studies. So what we are doing is having a target product profile that has to be seen in light of the HEMLIBRA, the ACE910 emicizumab era that we're living in. So that also means by the way that what we've done is actually to make sure that we don't end in a situation where patients who bleed on Concizumab cannot be used or treated on demand with one or the other agent. We've actually specifically started the trials by testing out can you actually co-administer NovoSeven and Concizumab in a safe way? Short answer is, affirmative. We've done that. There is no drug-drug interference in terms of thrombosis or the likes at least in those patients that we have tested. So, that is actually the kind of the first readout from the safety perspective. These are actually one study in hemophilia A and in the other study it's hemophilia with inhibitor patients, both hemophilia A and B. And the target product profile have a simple subcutaneous administration that is safe and efficacious. And that means, basically meaning a ABR, an annualized median bleeding rate of down in the 0 to 1 range that we are also seeing for Concizumab. Do bear in mind that this is a new mechanism of action. It's a humanized antibody against tissue factor pathway inhibitor. So, it's kind of disinhibiting the break that is constantly on the system. And that means that it will work across segments. You are no longer relying on the need for Factor IXa to be present on the activated platelet surface. So, in principle, this can be used also in hemophilia B unlike HEMLIBRA. So, the really exciting thing is to be honest, the Expo (01:04:10) 4 and 5 readout because if they are good then we are moving directly into pivotal trials starting next year and make them as snappy as possible realizing that we are behind our friends at Roche. Karsten Munk Knudsen - Novo Nordisk A/S: Good. Thank you, Mads. This concludes the lunch session for the Novo Nordisk Q1 financial results. Again, thanks to Keyur and Goldman Sachs for hosting us. And we look forward to see you again next quarter. Thank you.