Alvotech (ticker not provided) has reported a dramatic increase in total revenues for the first nine months of 2024, reaching $128 million, nearly nine times the figure from the same period in 2023. The company's third-quarter performance was bolstered by a significant improvement in gross margins, attributed to increased manufacturing utilization and the successful introduction of biosimilars.
Milestone (WA:MMD) revenues have surpassed $210 million, with expectations of further growth driven by new product launches and existing partnerships. The company's robust pipeline, including biosimilar candidates AVT16, AVT03, and AVT05, continues to progress, with regulatory milestones being achieved and commercial strategies ramping up supply in various markets.
Key Takeaways
- Alvotech's total revenues for the first nine months of 2024 reached $128 million, a substantial increase from the previous year.
- The company's gross margins more than doubled in Q3 due to increased manufacturing efficiency and biosimilar introductions.
- Milestone revenues exceeded $210 million, with new product launches and partnerships expected to fuel further growth.
- The U.S. FDA GMP inspection of Alvotech's Reykjavik site was completed successfully, with two observations noted.
- Biosimilar candidates AVT16, AVT03, and AVT05 are advancing in clinical and regulatory processes.
- Alvotech is expanding its biosimilar Humira supply in the U.S. and has launched biosimilars in multiple international markets.
- The company maintains a revenue guidance of $400 million to $500 million for 2024 and $600 million to $800 million for 2025.
Company Outlook
- Alvotech plans to launch its Eylea biosimilar in Europe in 2025, with U.S. timelines yet to be confirmed.
- Applications for biosimilars of Simponi and Prolia/Xgeva have been accepted by the EMA, with U.S. submissions expected by the end of the year.
- The company aims for sustained growth in the biosimilar market, supported by a broad portfolio and ongoing R&D efforts.
Bearish Highlights
- The company acknowledged uncertainties in product shipments moving into 2025, which may affect revenue guidance.
- The FDA inspection resulted in two observations, though these were considered addressable and part of compliance efforts.
Bullish Highlights
- Alvotech's biosimilar pipeline is strong, with several candidates progressing through clinical trials and regulatory processes.
- Significant revenue growth is expected in Q4, particularly from Humira biosimilar shipments in the U.S.
Misses
- No new revenue guidance for 2025 was provided during the call, pending commercial negotiations for AVT04.
Q&A highlights
- CEO Robert Wessman expressed confidence in meeting the upper end of the 2024 revenue guidance range.
- Gross profit margins have improved markedly, and further expansion is anticipated by year-end.
- The company anticipates international markets could contribute up to one-third of total revenues by the end of 2024.
Alvotech's financial performance for the nine months ending September 30, 2024, shows a company on the rise, with total revenues of $339 million marking a significant increase from $38 million in the previous year. The company's focus on biosimilar products, a growing market segment, appears to be paying off with strong orders and a solid pipeline that promises continued expansion and profitability. With $118 million in cash and a keen eye on achieving free cash flow positive status, Alvotech is positioning itself as a key player in the biosimilar space. The company's commitment to transparency and granular reporting in the future will likely be well-received by investors and industry analysts alike.
InvestingPro Insights
Alvotech's impressive revenue growth aligns with the InvestingPro data, which shows a remarkable revenue growth of 374.55% over the last twelve months as of Q2 2024. This substantial increase supports the company's reported nine-fold revenue jump for the first nine months of 2024.
The company's focus on biosimilars and its expanding pipeline are reflected in an InvestingPro Tip, which indicates that analysts anticipate sales growth in the current year. This expectation is consistent with Alvotech's maintained revenue guidance of $400 million to $500 million for 2024.
Despite the strong revenue growth, InvestingPro data reveals that Alvotech's operating income margin stands at -39.04% for the last twelve months as of Q2 2024. This negative margin suggests that while the company is rapidly expanding its top line, it is still working towards profitability. This insight is further supported by another InvestingPro Tip, which notes that analysts do not anticipate the company will be profitable this year.
It's worth noting that Alvotech's stock price has shown resilience, with a 32.56% total return over the past year. This performance is particularly interesting given another InvestingPro Tip, which indicates that the stock generally trades with low price volatility.
For investors seeking a more comprehensive analysis, InvestingPro offers additional tips and metrics that could provide deeper insights into Alvotech's financial health and market position. The platform currently lists 7 additional tips for Alvotech, which could be valuable for those looking to make informed investment decisions in the rapidly evolving biosimilar market.
Full transcript - Alvotech SA (NASDAQ:ALVO) Q3 2024:
Operator: Good day, and thank you for standing by. Welcome to the Alvotech's Third Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] I would now like to hand the conference over to your first speaker today. Benedikt Stefansson. Please go ahead.
Benedikt Stefansson: Thank you, and good morning or afternoon to everyone joining us on this call today. Yesterday evening, the company issued a press release that can be found on our website, www.alvotech.com. The release reports financial results for the first nine months of 2024 and provides a business update. Additionally, presentation slides that cover our call today have been posted on our investor website. You'll find all materials posted for the first nine months 2024 earnings call under News and Events in the Events and Presentations section on investors.alvotec.com. Our presentation materials and some of our statements that we make today may include forward-looking statements. These statements do not ensure future performance and are subject to risks and uncertainties that are outlined in company filings with the Securities and Exchange Commission. These risks and uncertainties could cause actual results to differ materially from forward-looking statements that are made. With me on today's call are Robert Wessman, Chairman and Chief Executive Officer of Alvotech; Anil Okay, Chief Commercial Officer; Joel Morales, Chief Financial Officer; and Ming Li, Chief Strategy Officer. With that, I would like to turn the call over to Robert Wessman. Robert?
Robert Wessman: Thank you, Benedict, and greetings to everyone joining us on the call today. We are very pleased with the results on the quarter and the first nine months of 2024 and as well as the continued progress we are seeing in the business overall. Total (EPA:TTEF) revenues for the first nine months of 2024 increased nearly 9 times when we compared to the same period in 2023. Revenues from the products for the first nine months rose to $128 million, which was driven by an increase in product revenues in the third quarter as compared to the second quarter in 2024. As importantly, the company realized a material step-up of underlying product gross margins, which more than doubled in the third quarter when compared to the second quarter. As we have discussed in the past, we expect a material increase in product gross margin in the second half of the year compared to the first half of the year. The drivers of improved margin are increased utilization of the manufacturing site and realization of the scale of activities for on-market products and ex-U.S. revenues for our biosimilars to Stelara. We do expect continued margin expansion due to better utilization and the shift in the product mix that will start to include Stelara biosimilar for U.S. as well as expected contribution from new products such as AVT06, our proposed biosimilar to Eylea and AVT05, our biosimilar candidate to Simponi and, AVT03, our biosimilar candidate to Prolia and Xgeva. Milestone revenues year-to-date reached over $210 million. While the majority of the revenue came in in the second quarter of this year, the third quarter saw expected revenues from existing partnerships and a few new partnerships deals. We are thrilled with our ongoing progress and our path to become a leading global biosimilar company. While our historical results are indeed positive, I'm even more excited about the execution of our pipeline and strong business fundamentals we are focusing on today. We believe these efforts are paving the way for sustained growth in the future. And with that, I would like to discuss some recent highlights in our business. In September, the company concluded an inspection by the U.S.-FDA of our manufacturing site in Reykjavik, Iceland. This was an extensive general GMP inspection. This is taking place less than a year after the most recent inspection that paved the way for approval from both SIMLANDI and SELARSDI. It's common practice by FDA to inspect sites after making their initial commercial entrance into the U.S. market. We of course welcomed the opportunity to test the company and its system, which have been heavily invested in over the past few years. We received two observations during this inspection. And while we take all observation very seriously, we view the overall results as a validation of our past and ongoing efforts to continuously improve compliance of our manufacturing sites. We do expect industry standard pre-approval inspections for future filings and we also expect future FDA general GMP inspections to take place on a two year cadence going forward. I would like to thank the hardworking team of Alvotech for their commitment to quality and compliance and the excellent results achieved during this latest inspection of our facility. I would also like to extend our gratitude to the commercial partners who routinely inspect our manufacturing facility. This dynamic provides us with new opportunities to enhance our quality systems and overall compliance and provides us comfort as we will continue to remain in good standing across the global markets. In addition to the recent inspection, we have continued to establish the base for future growth by advancing our pipeline and expanding our partnerships. AVT16, our biosimilar candidate to Entyvio is now in patient trials and we are the second company to reach this status in this growing market. Furthermore, we have received EMA acceptance on our application for both AVT03 and AVT05. AVT03 is our proposed biosimilar to both Prolia and Xgeva and AVT05 is our biosimilar candidate to Simponi. Finally, in the U.S., we received approval for an additional presentation of SELARSDI, our biosimilar to Stelara. More importantly, we will be launching in the U.S. market in 2025 with all indications which was expected, but also good to have completed now. Overall, we are pleased with the continued execution by the company that we have seen in 2024. On the next slide, you can see the timelines of events that demonstrate this execution and we have steadily been updating throughout the year. As important as current financial results are, it is equally important that we continue to execute on our business development progress and our research and development to secure that we have future opportunities. This allows the company to establish a steady cadence of revenue-generating possibilities in the future to maintain growth. Additionally, it is an important goal of the company to continue to diversify both products and markets as we strive to create a sustainable growth engine in the biosimilar space. With that, I would like to turn over the call to Anil Okay, our Chief Commercial Officer, to give additional updates for the markets and the pipeline. Over to you, Anil.
Anil Okay: Thank you, Robert. I will start with a commercial update in the U.S. We continue to ramp up our supply to our U.S. partners, which include both Quallent, private label as well as Teva. As we noted, we have approximately 1.3 million units in committed purchase orders for 2024 that we intend to supply this year. Just over 40% of that has now been fulfilled through the third quarter. So we do expect a meaningful step-up in biosimilar Humira revenue for the U.S. in the fourth quarter. With the order cycle we have, we are also seeing first quarter shaping up nicely as well. On the formulary side, we do expect expanded commercial coverage in the U.S. and additional exclusionary actions by payers in the U.S. markets which we believe will contribute to a growth year for the product in 2025. Moving to biosimilar Stelara, we recently announced that we have received approval on all indications for SELARSDI, ensuring a full label launch in February of next year. We have submitted the necessary supplements to also gain interchangeability for the U.S. market. And the BSUFA date for that is set for February 19th of next year. If approved, we expect the approval to be provisional with final approval for interchangeability to happen in April as exclusivity for the first interchangeable product expires. On the commercial front, we expect formulary coverage in 2025 and remain in conversations for potential private label businesses. We look forward to our year end call to provide further updates as well as an outlook for both opportunities in the near year. Moving to the next slide. I would like to briefly discuss our commercialization efforts outside the U.S. AVT02, our biosimilar to Humira has now been launched in 26 markets globally, including Canada and various European markets. Although these launches occurred four to five years after loss of exclusivity, these initial launches were crucial for establishing our manufacturing systems and processes, setting the stage for our global expansion. AVT04, our biosimilar to Stelara, has now been introduced in 23 markets. Unlike, AVT02 these were first in market launches positioning us strongly for future growth. The European Union remains a key focus for us and we are seeing strong demand for Uzpruvo, our Stelara biosimilar. Our partner, STADA is a well-established brand in the region. And they are seeing success across both tender and retail channels. To put the opportunity in perspective, we anticipate that up to one-third of our product revenues will come from markets outside the U.S. in 2024. Which highlights the diversification we are seeing with our global strategy. We expect this contribution to continue growing into 2025, driven by the maturation of existing launches and new launches from the three submissions we made this year. I would like to thank all of our partners across the globe for their strong efforts in driving biosimilar adoption which we collectively believe are important to enhancing the sustainability of healthcare systems around the world. Next (LON:NXT), I would like to move to our near-term pipeline. Which could yield launches as early as the end of 2025. And we can start with Eylea, where we have announced recently that our application has been accepted for review in Europe. We will also announce filing acceptance in the U.S. when that happens. Please note that, some announcements may not come until next year, even if the filing and the BSUFA clock begins in 2024, as there is a lag between filing and acceptance. With Eylea, I would like to bring up a few relevant points. Firstly, we have developed both the pre-filled syringe and the vial presentations for AVT06, our biosimilar to the original form of Eylea. Based on our understanding of U.S. requirements, we are one of four companies to develop the pre-filled syringe as requisite studies would require patients rather than healthy volunteers because of the method of administration for this product. We have strong partnerships on this product across the globe and we expect to launch in Europe in 2025 as a day-one launch. And while the timing in the U.S. is not 100% clear, the U.S. market for Eylea biosimilars is interesting. As we know today, Amgen (NASDAQ:AMGN) has defeated a preliminary injunction and has subsequently launched their version of an Eylea biosimilar in the U.S. Others have either been permanently or preliminarily enjoined to enter the market based on existing formulation patents. While I won't get into details, we do have a different position against the patents versus the enjoined group. And while I cannot commit to a date, we will certainly seek to launch as early as possible in the U.S. market. Also, as we have noted in the past, we are developing the high-dose version of Eylea which is a product that Regeneron (NASDAQ:REGN) is keen to switch patients to. We have developed the formulation and are currently in scale-up phase. Additionally, we are working through the regulatory process and are seeking the most expedited path-to-market in all applicable markets. Again, there is additional IP on the formulation, and we have developed our product with that in mind. We look forward to providing updates for biosimilar candidates to high and low-dose Eylea as the development programs progress. Moving on to the next two products in our near-term pipeline, I can provide brief updates on our candidates to biosimilar Simponi and Simponi Aria as well as Prolia and Xgeva. In Simponi, we just announced that our marketing application has been accepted for review by EMA and we also expect submissions to occur in the U.S. still within this year. In Europe, we are the first and currently only submission for a biosimilar to Simponi. And we expect the same in the U.S. and potentially other markets where we filed. We view AVT05 as a potential end of 2025 launch opportunity and are excited at the potential to launch the product in what will clearly be a limited competition market in terms of other biosimilar players. As a reminder, only one other company has completed a clinical trial, utilizing a proposed biosimilar to Simponi. Further in the U.S., the product is substantially split between two forms. The branded product is offered as an auto-injector as Simponi and the vial for infusion as Simponi Aria. We will be submitting our proposed biosimilar in separate filings this year. Moving on to our biosimilar candidate to Prolia and Xgeva. We have also recently announced marketing application acceptance by EMA and expect to file the product prior to year end in the U.S. The product is both a pharmacy and a medical benefit product in the U.S. And we have executed major contracts this year to ensure we have excellent commercial backing in both the U.S. and in Europe. Together with our commercial partners, we look forward to a number of exciting launches in 2025 and 2026 from our near term pipeline. Moving to the next slide, I will close my portion of our prepared remarks with a snapshot of our overall portfolio. As we have said in the past, we believe in a broad portfolio approach. Which can concurrently increase the future opportunities while enhancing opportunities for existing on-market products. And while our committed portfolio remains outlined on this list, we maintain an active cell line development group that is dedicated to our R&D platform. To put that into perspective, we have developed 15 additional cell lines outside of this list and are constantly working on a broad base of opportunities, which provides us flexibility in our development as we choose to move programs forward. We are very proud of the achievements of our development team and our pipeline is one of the largest and most expensive in the industry. This underscores our long-term commitment to biosimilars. I would like to now turn the call over to Joel Morales, our Chief Financial Officer. Thank you.
Joel Morales: Thank you, Anil. I'll now provide financial highlights for the period ending September 30, 2024. With respect to our operating performance overall during the third quarter, we continued to build upon the positive momentum we established during Q2. Product revenues are growing as our partners launch our products into U.S. and rest of world markets, the company has delivered our second consecutive positive operating profit and adjusted EBITDA quarter, and we continue to be focused on operational execution to maximize the potential of our launches as we conclude the final quarter of the year. Total revenues for the nine months ended were $339 million versus $38 million during the same period in the prior year, representing an almost nine times increase. Product revenues were $128 million, an increase of $98 million or 330% versus the prior year. And milestone revenues were $211 million versus $8 million for the same period in '23. This topline performance was driven by another consecutive quarter of increasing product revenues and continued milestone revenue recognition, where total revenues for the third quarter were $103 million versus $18 million in the prior year. Product revenues in the third quarter were $62 million, the highest recorded quarter by Alvotech, an increase of 16% from Q2. This quarter-over-quarter increase is driven by higher shipments of AVT02 for the U.S. market as we continue to ship product in line with the orders we've received and we expect these shipments to continue stepping up into the fourth quarter. Additionally, in Q3, we also continued to expand upon our launches of AVT04, our biosimilar to Stelara into ex- U.S. markets as our commercial partner expands their presence into European markets. And we also continue to supply into the Japanese market. Product margin in Q3 specifically reached 37% compared to 17% in Q2, driven by a combination of increased shipments of AVT02 into the U.S. and new product launches of AVT04 into Europe, all while we continue to scale our operations. During Q3, we also recognized $41 million in milestones, driven by submissions of our AVT06 and AVT03 programs for marketing approval in Europe, and the launch of AVT04 into European markets. Additionally, new licensing deals for our available programs were secured driving further revenue recognition. We continue to make significant advancements in our pipeline and where possible, pursue opportunities to accelerate the progress of our development programs. The signing of new licensing agreements and accelerated development progress can lead to higher-than-anticipated milestone revenues. Reported operating profit was $56 million for the first nine months compared to negative $278 million for the same period in 2023. The increase of $344 million was primarily attributable to our topline growth coupled with relatively flat cost of product revenues due to increasing manufacturing production, reduced production-related charges and lower costs associated with FDA inspection readiness. Additionally, operating expenses decreased versus prior year, primarily due to lower R&D, driven by a one-time charge of $18.5 million associated with the termination of a co-development agreement, lower overall R&D expenses, and lower G&A, driven by continuing efforts of the company to optimize our operations as we drive scale. For the first nine months of 2024, we reported adjusted EBITDA of $87 million versus negative $226 million during the same period in the prior year. This is largely driven by the gross margin contribution in the period and lower OpEx, particularly lower G&A costs on an adjusted basis. In Q3 2024, we reported adjusted EBITDA of $23 million versus negative $79 million during the third quarter of 2023. Please see the table provided in the appendix for a reconciliation of our reported to adjusted results. In terms of cash and liquidity, we closed the period ending September 30 with $118 million of cash on hand and $1.28 billion in borrowings. With our recent refinancing behind us, our major product launches underway and continued advancement of our pipeline, the company believes it has sufficient cash on hand to achieve free cash flow positive. We closed the period ending September 30 with 301.7 million shares outstanding, including unvested earnout shares. In the appendix to our management presentation, you will find a summary of shares outstanding. I will close today's presentation with a few brief comments regarding our financial guidance. We are currently on track to lend within the ranges provided. Our revenue guidance is $400 million to $500 million and is driven by a combination of our new product launches and significant development and performance-based milestones. Overall, we expect milestone revenue contributions to be slightly higher than we guided in 2024, driven by new licensing deals and earlier achievement of development progress than planned. We're excited to demonstrate the continued advancement of our pipeline which we believe will propel sustainable long-term growth of the company. As it relates to product revenues, as you heard from Anil earlier, we have orders from our U.S. partners of 1.3 million units for AVT02 in 2024 and are increasing our shipments to deliver a substantial portion in the fourth quarter. We're making preparations to fulfill all shipments in the quarter. However, there remains a possibility that some quantities could phase into Q1 '25 due to timing. Additionally, we are monitoring our mix of shipments to various geographies and customers, which could have an impact on both revenues and product margins. As we previously mentioned, we are also working on the potential for pre-launch revenues of AVT04 before year end. Contracting remains underway in the U.S. and timing and order size are still to be determined. In preparation for our upcoming launch, we continue to build commercial inventory. Final outcome of these discussions should become clear in the coming weeks. This is all to say, we are managing through a potential range of outcomes that can play out for us in the remaining final weeks of 2024. Finally, in October, the company exercised its option to pick interest in the first quarterly term of our new loan facility. By deferring cash interest payments, we created greater flexibility during a time we are simultaneously increasing the capacity and scale of our manufacturing facility and building commercial inventory for new launches. This is an attractive feature for us only available in the first year of our financing agreement. As a result of this election, we are now forecasting cash interest payments in 2024 between $45 million and $50 million. And with that, I'd like to turn the call back over to the operator for Q&A.
Operator: [Operator Instructions] And the first question comes from the line of Balaji Prasad from Barclays (LON:BARC). Please go ahead. Your line is now open.
Balaji Prasad: Hi, good morning, everyone, and congratulations on the quarter. So I have a few, but I'll restrict to two. Firstly, on the 483s, they were a bit of a surprise for me because as per my understanding when we visited the facility, I thought the facility was good for the next two years following the Jan '24 inspection and the next major inspection will be Jan '26 at least. So it looks like there's been an earlier inspection. Can you comment on that? And since you categorize this as a successful inspection, I would imagine the 483s were fairly benign. So could you also elaborate on that? That's one. Two, I would want to understand the guidance a bit more. I understand the uncertainties by partnership, but considering that we are nine months done, $339 million revenue is delivered till now, I'm surprised that the guidance wasn't tightened further. There's still a $100 million spread with a $400 million to $500 million guidance. If you could help me understand that too. Thanks.
Robert Wessman: Yes. Thank you for the question. Robert Wessman here. So basically, FDA will most likely come with the cadence of every second year to inspect the facility. We, of course went through a pre-approval inspection on two products which are AVT02 and AVT04, but we always knew that they would come again for a regular commercial GMP inspection, if you will. So as we saw it, FDA was combining few inspections out of Scandinavia and most likely came to Iceland to combine that. The outcome of the second inspection actually came with a very short notice, was a very successful one, we believe. And I would say those two observations we got are easily addressable. But of course, by saying that, I mean, we take every inspection and observation seriously, if you will. I mean, if you look at the overall the two observation, one was pointing at a past action, I believed back to 2022, with how we were handling the reporting on our autoinjector and we just committed to change that reporting going forward that was related to different market and even U.S. And the other one was related to an assay, which is commonly used and we are using with the same outcome and success as everyone else. But overall FDA is starting to divert the industry as a whole away from that method. And we already had starting to use a different method, which for U.S. markets, we have already submitted a variation because we need a variation to include a different type of method. But overall, it was in my mind, a great success. And just underlined on a very short notice, the company was very much ready for FDA and we will continue to be inspection-ready at any given time. And the just to highlight that also, we are submitting three products into U.S. and it's highly likely that we will have a inspection again -- prior approval inspection, if you will, already next year because of the three submission. But the cadence of general GMP inspection is every two year. And this is what that was the second one.
Balaji Prasad: Thanks, Robert.
Joel Morales: And hi, Balaji, this is Joel. Thanks for your question. I think with respect to guidance, as 2024 progresses, we are seeing quite a rapid ramp in our revenues and you can see that in second and third quarter results. And as we mentioned, we expect to see that continue to increase in the fourth quarter. But there still remains, as you highlight, a wide variety of outcomes that could impact the product mix and profitability and this includes some expected shipments that may move into very early in '25, which would have no negative commercial bearing, but it does somewhat restrict our ability to refine our guidance any further for the calendar year.
Balaji Prasad: Thanks, Joel. If I could just maybe pursue that a bit more. Considering that you have product revenues of around $62 million in Q3 and that is -- huge portion of Humira is going to be boosted in Q4, I would have thought that just product revenues from Humira alone would take you through the beyond the $400 million mark.
Joel Morales: Yes. I mean, in the fourth quarter, we are, as we mentioned, planning to continue shipments in the fourth quarter. It is a high volume of shipments. And again, it's a question of how much of that could potentially cross over into '25. That's both for the launch of -- or I should say products related to Humira, but also new product launches as well.
Balaji Prasad: Got it.
Robert Wessman: Yes, it's kind of inconvenient that the December month is end of the calendar year, if you will. So it's a matter of how much we ship in December versus January and the business is there. And just to underline that what the question is related to, as we have said, our fourth quarter will be by far the strongest shipment of products in the entire year towards '24. And we are gearing well to it. We are seeing -- that is shaping up very nicely. But again, there might be some spillover to -- towards '25, which we don't want to really commit to 100% now, whether it ends all in December or whether it spills over to next year..
Operator: Thank you. We will now take our next question. Please stand by. And the next question comes from the line of Niall Alexander from Deutsche Bank (ETR:DBKGn). Please go ahead. Your line is now open.
Niall Alexander: Hi, it's Niall Alexander from Deutsche Bank. Thanks for taking my questions. So just two, please for now. The FDA inspection, I guess just push a little bit more on that. Will that have, or could it have any impact on the launch of Stelara biosimilar at the beginning of next year? On top of the guidance as well, sorry. So it was early on in the year. You've communicated $600 million to $800 million revenue guidance with the news of the change in supply shipment, the news on the FDA inspection, is there -- should we assume that that guidance is reasonable to have for the time being? And sorry, if I can just squeeze in one more on the Eylea biosimilar. I guess in your view, what do you think Alvotech -- or sorry, in your view, what do you think Amgen is doing right to get over the line? And what do you think Alvotech needs to do to get them -- get their Eylea biosimilar in the U.S. potentially over the line? Thank you.
Robert Wessman: Yes. Robert here, thanks for the question. So if you look at our first successful FDA inspection at the beginning of the year, it was a pre-approval inspection for two products. And we went through that in a stellar way with one 483. When you have a general GMP inspection is a little bit different inspection, but usually broader on the whole systems and being first time commercial -- first time commercial inspection, if you will, it reaches out in a little bit different areas. Clearly and surely this is not going to hold off any launches having two 483s, the first one had one 483, this one had two 483s. The two 483s are easily addressable, as I mentioned, surely will not hold off any launches and having those two 483, I believe is a great success, to be honest being easily addressable. On the guidance, we have not given out a guidance as new guidance for 2025. We will do that once the commercial negotiation has completed for AVT04. So I -- meanwhile, we have not given out the new guidance. I think it's very fair to assume that the old guidance is still basically valis, $600 million to $800 million, as you mentioned. So, we should generally assume that is still in place until we come in with something else. And Anil can talk about the opportunity which we saw in Amen but just one sentence on that for me is that we think this could create amazing opportunity for us. We are of course evaluating the opportunity. We know how our product is differently developed from the one which are injuncted. So it was exciting news when Amgen came out. But Anil, you want to add to that?
Anil Okay: Thank you, Robert. So first of all, we'd like to remind you that we will be launching in Europe in day-one, which will be still next year in 2025. When it comes to the U.S., as you can appreciate, at this time, I won't comment further on our IP strategy. For us, the first step will be gaining -- filing acceptance, which should happen soon. And from there, I would assume there will be more public information that becomes available. But as Robert mentioned, we are very excited of this opportunity. It's an interesting opportunity here and we have a clear strategy to hopefully be in the market as soon as possible.
Operator: Thank you. We will now take our next question. Please stand by. And the next question comes from the line of Carl Byrnes from Northland Capital Markets. Please go ahead. Your line is now open.
Carl Byrnes: Thanks for the question and congratulations on your progress. I'm wondering if you can comment at all in-terms of your expectation of where gross profit margin might be over the next 12 months to 18 months considering product sales ramp and efficiencies that you've achieved? Thanks.
Anil Okay: Hi, Carl [technical difficulty] thanks for your question. You saw in my opening remarks, our product margins in particular went from 17% to 37% in the third-quarter. We do expect our product margins to continue to expand as we exit the year. At this point in time, we're not providing any guidance for 2025.
Carl Byrnes: Great. Fair enough. And then just as a quick follow-up. Can you provide any breakout on U.S. product sales for the third quarter and nine months? Thanks.
Anil Okay: We currently do not provide any breakout of our U.S. product sales by product. But what we can say is that our ex- U.S. contribution is significant and can reach up to a third we're expecting of our total revenues by the end-of-the year.
Robert Wessman: Yes, Carl, I think as we mature and diversify, you're going to see more granular reporting, but obviously, these are early launches and there's one-product currently launched in the U.S.
Carl Byrnes: Exactly. No worries. Thank you.
Operator: Thank you. As there are no further questions, I would like to hand back to Benedikt Stefansson for any closing remarks.
Benedikt Stefansson: Okay. On behalf of the Alvotech team, I would like to thank you all for participating in today's call. We look forward to talking to you all again, and I wish you a very good end of the day. Thank you goodbye.
Operator: This concludes today's conference call. Thank you for participating. You may now disconnect.
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