Orion Oyj

OMXH:ORNBV

Earnings Call Transcript 2018-Q1

[Lilli Riikonen]

[Foreign Language] Good afternoon, and welcome to follow up Orion's Interim Report January-March 2018 News Conference. My name is Lilli Riikonen, and I'm from Investor Relations.In a few moments, CEO, Timo Lappalainen, will give a brief presentation on the results, after which we will have the possibility to ask questions either from him or from CFO, Jari Karlson.We will first take the questions here from audience in Espoo, Finland, and then from the teleconference lines. Please state your name and your company before asking your question.Before we start, I would like to remind you that the presentation contains forward-looking statements. Currently, note the disclaimer related to this.But now, please welcome CEO, Timo Lappalainen.

[Timo Lappalainen]

Thank you very much, Lilli. And just to repeat the disclaimer here, we had a good start and an exciting start for the year. We had a strong cash flow. Profitability exceeded with 28% EBIT margin that exceeded our goals, financial objectives. Net sales and the profit, of course, those were affected by the increase in generic and the price competition. We also had somewhat smaller milestone payments. And also, we had a headwind with exchange rates. Of course, the comparable period, 2017, that was exceptionally strong, so we were up against a very strong comparison.We had several positive news. Easyhaler and Dexdor businesses, those continued to grow. For the forthcoming importance of the future, it is that we've got the positive conclusion of our salmeterol-fluticasone Easyhaler from the decentralized European Union marketing authorization process. And now we are going through the national phase. We also, today, informed about 2 new clinical trials: one relating to a CYP inhibitor for prostate cancer entering into Phase I; and also, continuation of our oral levosimendan program in ALS entering into Phase III. Also, when we reported the full year results 2017, we informed about the results of the Alzheimer's research program, and now we received the notice also from Janssen that the program will be terminated.Early Saturday, we informed that we have signed an agreement with this investment fund managed by Axcel Management A/S relating to the divestment of Orion Diagnostica all shares to Axcel. And in the future, Orion Diagnostica business is actually reported as a discontinued operation.When we look at the waterfall, how the business has evolved in the first quarter compared to the last quarter, the big ticket item here is actually exchange rates. So we had headwinds. As we report in euros and the euro appreciated against all the other major currencies that we trade, that had a major impact, not only in sales but also in profitability, and I'll comment on that very shortly. But EUR 7 million we lost through exchange rates.Now the sales in Finland, the loss of EUR 5 million, that relates actually to the system change that took place in effectively early 2017, and as we've informed, has a spillover effect still continuing this year.Parkinson product sales, that's the branded Parkinson product sales. Whilst the decline was actually lower, what we've indicated as a trend line, of course, that still had an effect.Then we had a period where the milestones and the royalties were lower than the -- in the previous year, so that also bore into that. And then, of course, we had also some positives. So all the others, accumulated, in totality, had a EUR 3 million positive effect. So that's sort of the line how we came to EUR 247 million in sales.In operating profit, when we look at the right side of the graph, starting from the EUR 88 million, in terms of the product sales, those were lower by EUR 7 million, and the margin ate up into that EUR 5 million. And out of that EUR 12 million, in totality, EUR 5 million is relating then to the exchange rates. So EUR 7 million in exchange rates to the net sales and EUR 5 million in operating profit. Of course, the milestones, as they flow through the P&L, they flew directly to the bottom line, so EUR 6 million out of that. We had some operating other income as well, EUR 2 million, and then a little bit higher fixed costs relating to the certain marketing and R&D initiatives. And that's how we then ended up in 70% (sic) [ EUR 70 million ]. As said, that exceeds our financial objectives, so very good results from that perspective.No really major change when we look at our geographical breakdown of the sales. So Finland continues to be the largest country market. Scandinavia, all in totality, a large market for us. And obviously then, the large European markets: Italy, Spain, Germany, the U.K.And then when we break down the business in terms of the pharma business, in terms of the divisions, so we have the Specialty Products, very close to the first quarter last year, somewhat on the negative side. On Proprietary side, 6% down, so that was maybe a little bit more than on the Specialty Products.On Animal Health, topping the first quarter last year. And in Fermion, very much depending on the seasonality, so there were lower shipments to both Orion and also to external customers.And in Contract Manufacturing and Other, that is sort of a risk. There, we had a deviation. And of course, last year, we also informed that one of the major customers there ceased to buy products from us or ceased the product line.Now when we look at the segment that we report as a continuing operation, which is the pharma, the largest -- the lead table of the product, the largest product, still continues to be our Parkinson disease products. And here, we had the 8% decline. And as typical, we have guided as a good number to follow over the years or along a period of time is sort of mid-teens decline, and this quarter was on the lower end of that.On the Easyhaler, strong growth continued. That is on the back of the Bufomix. Also, Dexdor continued to grow. And Simdax, we had a slight headwind there and had a little bit lower sales. Then on the biosimilars, that's a tricky area as that depends -- the volatility of that actually depends on the tenders, how the tenders -- or the timing of the tenders and naturally also your success in different tenders.And then the key products for our Animal Health business, the animal sedatives, had a good run in the first quarter.So let me start first with Proprietary Products. As expected, no news that the Parkinson disease products, those continue to decline. And however, the Easyhaler business, which is doing very nicely, that continued to grow. And of course, now with adding on the salmeterol-fluticasone there will be a nice add-on for the years to come.Dexdor continued to grow despite the fact that there is generic competition. However, the main generic competition that we so far have seen has been capsuled in Germany.Simdax sales, those declined somewhat. And we are still looking forward to continue the Simdax sales, and we believe there's a lot of mileage in that product.So no news really on the Parkinson disease product. And as we have guided several times, one should look at the longer trend line, not pay so much attention to a single quarter when the quarter variance and the volatility from quarter-to-quarter can be quite substantial depending how the shipments go, especially through our partner, Novartis. But so far, the mid-teen decline over the period of time is a good guidance. Should we learn more on that, at some point we start hitting the bottom line, of course -- or the bottom cycle of that, of course, then, we will inform you accordingly.And then when we look at the 12-month period ending December 2017, we see that actually, the U.S. proportion is very limited of our business. So it is pretty evenly distributed in Europe, in Japan as well as in rest of the world.Easyhaler family, that is growing strongly. We had a strong growth in totality, but of course, that's on the back of the budesonide-formoterol Easyhaler, which grew by 36%. And now the product is available in most of the key European markets. Our partner, Menarini, they have launched the product in France in the first quarter. We've also submitted the first applications in the Asia Pacific region as well as in Middle East, North Africa. And the good part here is that if we look at the market share of our product, there are some markets where we are pretty strong. And we take notably Sweden here with a 37% market share. And there are markets where there are great opportunity still for growth: Germany, 6% market share, so there's a lot of business for us to take. So this gives you a little bit of spread where we operate.And as said, the salmeterol-fluticasone, there, we are now expecting shortly to receive the national approvals, and that process is moving on and then we will be launching the product in not-too-distant future.Also, last time, we informed that we have actually initiated activities for the seventh Easyhaler product, the tiotropium product. So we will be adding a new member in the Easyhaler family.Dexdor, great product, still continued to grow despite the fact that there is generic competition, but as said, the material competition that we've so far seen is limited to Germany. And as we see here in the pie chart, when we look at the moving annual total ending December, there is still quite a lot of business to be taken by Dexdor if we take this as the target market. And with a 12% market share, so there's still a lot of business here for Dexdor.So that was the Proprietary Products side. Now moving on to Specialty Products, so that's the division that includes our generic prescription products, hospital products, OTC, pharmaceutical products as well as non-pharma product that we sell mostly through pharmacy channel. And here, we've broken down that in 3 key regions, Finland being the largest region. There, we had a decline. As said, the Finnish had changed in our system here, it ate into that. Scandinavia grew in the first quarter, and then a strong growth continued in Eastern Europe and Russia.Biosimilar business is an important part of this, and those sales, those declined by 4%. We have introduced actually a new biosimilar, Ritemvia, and we expect to see the fruit of that. The biosimilar business is getting tougher. We see more players entering the market. We see a tougher competition resulting into the more savings to the society, which, of course, is also the meaning of that business.And when we look at the -- how that business is broken down apart from the geographical, when we look at the pie on the right-hand side of the slide here, we see that the generic drugs, which are really then the Rx, that's the bulk of that business, and then self-care products is an important element and the growing parton the biosimilars.And here, we have a slide explaining what is Orion's position in our key markets. So when we look at the generic business in the Nordic markets, in Finland, we are #1; in Sweden, we are #2; Denmark, also #2; and in Norway, #3.Here in the graph, you may want to pay attention how we've explained here the market, and this is full year 2017. So we have the Orion -- we had a market here, how much the market grew in respective countries, what was the growth of Orion. And then the number in brackets, that includes also biosimilars. So that's where we see the volatility there from a country to country and, of course, on Orion as well depending how successful we've been with the biosimilars.So we see that overall market in biosimilars, that had a strong growth. We've a little bit missed on that growth, however, continue to plow in that.And overall, when we look at also the large markets in Poland, that's where we are not present today with the biosimilars but are growing strongly.In Finland, we also take apart the reference-priced products. So those are the prescription products that are in the reference price system, so-called pricing corridor system, and what is actually our position in that market segment. I'll come back to that a little bit more.So the important part of our business is our business in the local market here in Finland. And the total market, this includes now the -- both the medicinal product as well as non-medicinal product, which are sold through the pharmacy channel. We're a little bit more than EUR 650 million for the first quarter. Our market share was 12%. The overall growth of that market was 11%. However, we declined by 6% due to the changes in operating environment, especially due to the pricing system changes. Last year, we informed that, that ate into our sales roughly EUR 15 million, and we expect that effect is -- spillover, that continues this year.And here on the graph here, we also break down the total market share of Orion, also what is our market share in self-care products. That's -- we are about 1/4 of that market. And then on the Rx prescription products, our market share is roughly 10% there. And then about 60% of that business is actually reference priced, where our market share is 27%. So we wanted to, at this time, open up a little bit of that, and hopefully, you'll find that helpful also moving forward.Then moving to the future of the company in research and development. So this is the traditional chart that we've used to explain where we are. So on Easyhaler fluticasone -- salmeterol-fluticasone, we are in the regulatory phase for the national approvals or the national phase in that. Tiotropium is in the bioequivalence study phase. On 201, darolutamide, we have 2 programs. We'll have a separate slide on that, and those -- both programs are now in Phase III. And as we inform today, we are -- we have also moved -- decided to move forward with our oral levosimendan for ALS.Our Parkinson disease program, that continues in Phase II as well as our growth factor inhibitor for solid tumors. We have a BET protein inhibitor also in Phase I. And today, we have informed about a new program in -- for prostate cancer, for late-stage prostate cancer.So let me talk about a little bit more in those. So darolutamide is an agent that is targeted for prostate cancer. We -- when we look at the data that we have available, it has a high affinity, so it binds very well to the androgen receptor. And it -- actually, the differentiation factor here is that, that data so far suggests that it may have a low blood-brain barrier penetration and potentially resulting into reduced side effects in central nervous system when administered to patients.We have 2 Phase III trials ongoing with our partner, Bayer. ARAMIS, where -- which is a trial where the patient population are actually non-metastatic, castration-resistant prostate cancer patients who have a high risk for developing metastatic disease stage. And here, the primary endpoint is darolutamide over placebo in metastatic-free survival. So this is not a trial where you recruit a patient for a certain period of time in the trial and that you know pretty certainly when the trial ends. But you recruit the patients, and then once the patients are recruited, then you start looking at the events when they take place. So that's why it is not that easy to give you the exact date when the trial will be finalized. But we have informed that the recruitment for this trial is finalized, it's complete. And we estimate that the completion of the trial would be somewhere around September this year. So it's getting exciting.On the top of this, we have another trial where we look at darolutamide. It's called our ARASENS, and this is a trial where the patients are metastatic. They are hormone-sensitive to the prostate cancer treatment. So here, we have darolutamide combined with an androgen deprivation therapy, which is typically a hormone therapy, and docetaxel. And here, the endpoint is overall survival. So again, we recruit a pool of patients, and then we look at these 2 comparative arms, how the patients will fare in this trial setting. Recruitment has been exceptionally good in this, and it has progressed very well. And the completion as we today speak, we expect somewhere in 2020.Moving forward. So our new investment is in ALS. ALS is, as we know, a very severe disease, resulting in the patient death, typically on the average of 3 to 5 years. It's progressing fast. It is a neurodegenerative disease that typically leads to paralysis and the death due to respiratory failure. This is an orphan product -- orphan indication. And it is fairly close in the order of magnitude, and you can compare that to multiple sclerosis.And in our program, levosimendan is studied for the symptomatic treatment for muscle weakness. So this is not a program where the intention is to slow down the progression or effect that -- disease modification, but the muscle weakness, which is the main symptom of ALS. And we have a data that suggests that levosimendan would have a positive effect on muscle function. And this data we have both in -- of course, in animals but also in humans. And these data points, they're encouraging enough that we wanted to take forward this program, of course, because this is a devastating disease, and should we be able to find relief for this patient, that would be great.And we are moving forward to a Phase III trial. This is a typical randomized, placebo-controlled trial when the randomization is 1:2, placebo versus active. This is a longer-term trial. So we have first endpoint is at 12-week slow vital capacity, which actually compares the breathing function or the capacity compared to normal subjects. And then we have ALS functional rating scale, which -- where we -- which tries to actually evaluate the disease progression of the patient.We expect to have about 80 to 100 sites in the U.S., Canada, Australia as well as in Europe. And our estimate for this 3-year package, including, of course, add-on things that you need to do on the top of the exact Phase III trial is about EUR 60 million investment, and this is something that we are embarking by ourselves at this stage.Then a new exciting opportunity, where we have a hormone synthetics inhibitor for castration-resistant prostate cancer. This is a totally new approach to this group of patients. Steroid hormones, they stimulate the growth of many cancers, most cancers in prostate and breast, not all but many of those. Hormonal treatment, that's the mainstream for many of these patients, but we know that the cancer is actually very clever. And as it mutates, it eventually will actually overcome the resistance.Based on the data that we have available today, it suggests that our ODM-208 would inhibit totally the synthesis of steroid hormones. That, of course, means that apart from what we are studying now, it potentially has also utility in other cancers where there's a risk of developing resistance to hormonal treatments. This -- when taking this treatment, you need to compensate certain vital hormones, and those are then administered to patient with an additional medication. We're really excited about this approach because this might be very -- we know that this is a novel approach; of course, carries also the risk that we always have with a novel approach. But this is -- we are very excited about this opportunity.Okay. So that was about pharma. Then we report as a discontinued operation our Diagnostics business. And as we've informed, we have signed an agreement with Axcel Management Fund, which is originally a group of Danish -- it's a Danish fund originally. We've signed that agreement on Saturday with a fixed purchase price, which is approximately EUR 163 million. These are typically cash, debt-free, so it's always approximate at this stage before we close. And then on the top of that, we informed that there is a potential -- potentially a variable component that depends -- the payment of that, if any, depends on the exit return to the investors who have invested in that now, the business, that means Axcel. And we expect to recognize a capital gain out of this transaction, about EUR 128 million in other operating income for this year, and this does not include the variable component. And this is important in our focusing on pharma, putting us the building blocks to further develop pharma business and giving us also means to build the growth in that -- our core business. Of course, that also means that, that will strengthen our equity position so that apart from growing, we can still achieve our dividend distribution objective.And in our outlook, as we -- when we announced the transaction, we also updated our outlook. And then we continue to say that due to the generic and price competition, we estimate that the net sales, excluding Orion Diagnostica, will be at the same level or slightly lower than 2017. And here now, the net sales reference point has been then corrected for the Orion Diagnostica.In terms of the operating profit, we say that we continue to -- our efforts to generate growth. And this means that the -- also in sales development that we need to focus on. Excluding Orion Diagnostica and other material capital gains, we expect our operating profit to be lower than 2017. And then the reference point is EUR 284 million. And here, we only repeat the statement relating to the capital gain that we are expecting to recognize in other operating income.And then the rest of the year, Orion calendar. The half year results, we will discuss July 18. And then the third quarter, the 1st -- January through September, that we will discuss in October 24.Ladies and gentlemen, at this stage, I'd like to invite our CFO, Jari Karlson, to join me here to the podium. And as Lilli here said, we are happy to entertain questions. Kindly state your name and the name of your organization. That will help us, and we will start here from the live audience in Espoo if we have questions.

[Timo Lappalainen]

At this stage, seems like we've exhausted all the questions here in live audience, so should we have questions on the telephone lines, please?

[Operator]

[Operator Instructions] We do have our first question from James Wallis from Crédit Suisse.

[James Wallis]

Firstly, on the gross margin. So we anticipate a decline in gross margin for the quarter. We've seen the full extent of that decline in 1Q or as in previous years, should we expect it to decline further? And secondly, on biosimilars, so again, we saw the decline in Remsima sales, so that EUR 10 million for the first quarter. Is that -- again, is that sort of representative of the likely quarterly sales going forward for 2018? Can you give any indication on any of the major tenders for either of your biosimilars coming up? And also, could you give any color regarding the intensifying price competition for Remsima? And then finally, on R&D expense, so can the 3-year cost of EUR 60 million for the ODM-109 Phase III study be built within the current annual R&D spend of around EUR 100 million? If not, when do you expect the R&D spend to pick up?

[Timo Lappalainen]

Jari, you want to comment the gross profit, I'll take the next ones.

[Jari Karlson]

Well, I mean, the gross profit actually has been relatively steady for many years, so with very small longer-term decline. There, of course, have always been quarterly variations to some extent. But this decline, of course, is mainly due to the situation in Finland where the margins and prices have been coming down. And the other important component, of course, is that Dexdor is now facing generic competition that has had effect on the price and margin for that product. In the other areas, I'd say that there have not really been that major changes. So at this stage, there probably will be even in the longer run some decline but nothing really dramatic, I'd say.

[Timo Lappalainen]

In terms of the biosimilars and especially in Remsima because that's still the largest product and will likely to continue to be for a while in that space. The first quarter is unlikely to be representative. And the fact is that the Danish national tender will -- from our perspective, that will run to end...

[Jari Karlson]

Norway.

[Timo Lappalainen]

Sorry, Norway. Sorry. Norwegian national tender will run into its end in end of April. So at that stage, then starting in May, we are absent both in Norway as well as in Denmark. Those are the 2 national tenders that we have here in the Nordic countries. Now the rest of the markets, of course, Sweden as well as Finland, those are more regional tenders, and those are ongoing tenders. But these 2 larger tenders, especially the Norwegian tender, the shipments to that will likely to run down in the month of May. So it is a fairly large portion of that. Pricing of biosimilars, especially in terms of the Remsima, we have seen that decline quite substantially over the few years. And it is a hospital tender business. It is a tough business in that arena. Will they still come lower? Nobody knows, but at least what we have seen, they come substantially lower from the original list prices, which are probably 60% level or so, even in some cases, steeper. Then there was a question on the R&D expense and relating to the ODM-109 trial. This trial cost as today, we believe we can absorb that in our R&D expenditure. Of course, that varies anyway for something -- a few millions every year depending how the clinical trials proceed and what other interesting, great ideas come out of our research. But as of today, we think that, that would not have a material impact in that.

[Operator]

We do have next question from the telephones from Sami Sarkamies from Nordea.

[Sami Sarkamies, Senior Analyst of TMT]

I have a couple of questions, starting with the timing impacts its customer to have these between the quarters. Just wondering whether there was some kind of link between Q4 and Q1 as you were really struggling to meet the guidance last year. So if this have any spillover impact on costs or sales in Q1.

[Timo Lappalainen]

Nothing material, no. No, I mean, we don't, in that sense -- of course, we try to make the number or the -- as much sales and the profit each year, but we don't, in that sense, plan for a specific number.

[Sami Sarkamies, Senior Analyst of TMT]

Okay. And then I would continue on guidance for this year. You're guiding for flat or slightly down full year net sales, even though in Q1, net sales fell by 7%. Could you open up your thoughts regarding the remainder of the year as guidance implies clearly better development during the rest of the year?

[Timo Lappalainen]

Yes. The key factors here, of course, would be one is Easyhaler. We expect that there's a lot of mileage in that. We expect also to turn around the Simdax business. We expect to continue with the Dexdor as we've successfully done in that first half. And of course, also, we have also a goal to continue and turn around the business to a growth mode here in the local market here in Finland. That will be a longer stretch. It's not 1 quarter. But the game is on, and we are prepared to take that on.

[Jari Karlson]

And of course, one needs to remember that last year, the first quarter was unusually good, so that didn't really represent. So now, we have kind of a more normal quarterly sales this year, which, of course, means that in order to meet this guideline, we don't need to generate any exceptional results in -- during the rest of the year.

[Timo Lappalainen]

Good point.

[Sami Sarkamies, Senior Analyst of TMT]

Okay. And then further on guidance, should we anticipate that you will start providing forward guidance at some point during the year as your visibility on full year earnings increases?

[Timo Lappalainen]

Should we make a change in our guidance, we will, of course, inform appropriately on that with the stock exchange release. But so far, that's our plan.

[Sami Sarkamies, Senior Analyst of TMT]

Okay. Then on the divestment that you just recently announced, can you open up your thinking on how these proceeds will be split between payouts to shareholders and investment into [ card ] business?

[Timo Lappalainen]

Yes. Thank you. Of course, without providing any exact numbers because at the end of the day, this is a shareholder matter, but the management perspective here is that these funds and the cushion that they will provide us in -- and providing dividend as per our policy and our financial objectives. On the top of that, it would give us a little bit room actually, not only to initiate the Phase III trial, as we have now initiated on our own to the U.S. market and, of course, to the Europe as well, but also look at the opportunities in licensing -- late-stage in-licensing opportunities to augment our own pipeline. And of course, you can be rest assured that the money doesn't burn a hole to our pockets here, so we will use the monies wisely, unlikely to utilize this as one goal, be that for the investment to the future because -- that we will monitor carefully these investment opportunities. And also, of course, this is subject to the shareholders, but we may also see that over a period of time when these are used for actually maintaining that dividend as per our financial guidance, which as I actually also say that in the long run, we want to increase that.

[Sami Sarkamies, Senior Analyst of TMT]

And one final question on the ALS study that you announced that. When do you anticipate completion of this Phase III study? And at which point could you be ready to launch the product assuming everything works out?

[Timo Lappalainen]

Well, what -- as we indicated here, a 3-year program, which we've very recently now initiated. About roughly -- depending what type of status prior to review it will get with the FDA, but one says cautiously from 6 to 9 months, and that's when we would then hit the market, of course, subject to that, the data supports that.

[Operator]

We do now have a next question from Richard Koch from SEB.

[Richard Koch, Analyst]

Going back to -- or staying on the ODM-109. What's the sales potential that you see from that drug? What's the size of the market, et cetera?

[Timo Lappalainen]

Well, of course, this is an orphan disease product, and that means that orphan disease does not necessarily mean a billion-dollar product, but it will be a significant product for us. And if we look at the -- one of the comparisons could be, if we look at the Parkinson disease product, which is one has to remember that in Parkinson disease, when Stalevo was under the patent protection, it sold about EUR 500 million or so globally, but that, of course, was not a naïve market. I mean, there are several products treating Parkinson disease, which is more prevalent than ALS, but nevertheless, it is one of those benchmarks. But we are very careful in providing guidance in terms of the exact sales numbers before we say a little bit more on the data. We understand also the competitive situation, so I think then, it will be fair to provide you a little bit more exact numbers on this.

[Jari Karlson]

And of course, the pricing of this type of completely new area of treatment is still very much open, so unlike in the Parkinson's where you have an established market. And that, of course, will have also a big impact, and it's a little bit too early to predict what will happen to the pricing of this type of a product.

[Richard Koch, Analyst]

Okay. And for the other projects going into Phase I, I assume that you don't want to comment on the sales potential there either or...

[Timo Lappalainen]

Well, no, because, of course, it depends how the data pans out. These are -- if we look at the late-stage prostate or breast, of course, those are very large indications. But then the question becomes what segment actually we're going after, and that we can only speak more on that once we see the data on that.

[Operator]

We do have a follow-up question from James Wallis from Crédit Suisse.

[James Wallis]

On the Diagnostics division, what level of tax will you pay on the capital gain there? And then following on to Dexdor, so a second generic manufacturer recently claimed that they launched the Dexdor generic and they're expecting to roll out in major European markets. Are you seeing any early penetration of that drug? When do you expect increased competition in other major EU market? And back to Remsima, what's sort of the size of the Norwegian tender versus the Danish tender?

[Timo Lappalainen]

Do you want to comment on the tax?

[Jari Karlson]

Yes. So this is a sale of shares of a wholly owned subsidiary, so there will not be any tax on the capital gain on this transaction.

[Timo Lappalainen]

So that's a tax-free transaction. In terms of the Dexdor, yes, there are also other players in that. But when we will see generic competition, I think that's a really, really hard question to predict because we will only know when we see the competition in terms of either shipments to customers or then making offers to the customers. And as we said in our quarterly review, so far, the material competition so far that we've seen, that has been limited only to Germany. The Remsima, both tenders in Norway and Denmark, they're about at equal footing because the population size is about the same.

[Operator]

It would appear we have no further questions over the phone at this time, sir.

[Timo Lappalainen]

Okay. Thank you very much. Should we have anything from here in the live audience in Espoo? Seems like we've exhausted all the questions. Thank you very much for joining us today. And as said, next time, we will meet in July. Thank you.

[Jari Karlson]

Thank you.