Swedish Orphan Biovitrum AB (publ)

STO:SOBI

Earnings Call Transcript 2022-Q4

[Operator]

Ladies and gentlemen, welcome to the Sobi Q4 2022 report. [Operator Instructions] I will now hand over to the company.

[Guido Oelkers, executive]

Yes. Thank you so much, and hello, everyone. This is your CEO. So we welcome to the fourth quarter full year 2022 conference call for investors and analysts.

The presentation was posted to sobi.com earlier. Let's go to slide number 2. Slide 2 has the usual safe harbor statement. As stated, I'll be making comments that mostly related to fourth quarter performance in 2022 at constant exchange rates [Technical Difficulty]

Please turn to Slide #3. This is the agenda where we plan to cover all key aspects of the results today. We plan to review the presentation first and then do a Q&A until around 2:00 p.m. Swedish time. If you keep question short, we will try to keep our [Technical Difficulty].

In speaking order, I'm joined by Henrik, our CFO; Anders, our Head of R&D and Medical affairs and Chief Medical Officer. Armin, our Senior Scientific and Medical Advisor who usually [Technical Difficulty].

Please turn to Slide #4. Starting off, I'm pleased to say that 2022 was a year that we saw a solid future ahead. We met the outlook for the year and we also guided for further growth in 2023.

In the quarter, revenue increased by 5% in constant exchange rate and then by 8% in the year, fully met outlook. And it would lead to end of year with the revenue to launch medicines has increased by 29% in the quarter and then by 37% in the year, led by Doptelet.

In Haemophilia, we continue to develop relative stability and the Aspaveli launched [indiscernible] nearly in third quarter, while Immunology was held back by high COVID comparison for Kineret in 2021 as well as low sales of Gamifant. We saw slower cost growth in the SG&A in one of the growth in R&D limited to cost, as a result, the EBITDA margin adjusted a little at 41% in the quarter and at 35% in the year. So the pipeline continued to deliver with the launch of EU approval, Doptelet submission in China for ITP2, Kineret emergency use in the U.S.

AstraZeneca and Sanofi have also announced the regulatory submission items for nirsevimab with a late 2023 approval expected. News flow is set to increase in 2023.

In summary, we met the 2022 outlook today, and provide us a solid outlook for 2023 with continued growth. Thanks to all my colleagues at Sobi to make this progress possible.

Let's turn to Slide #5. Moving into these areas and geographies, we saw good double-digit growth in Haematology driven by Doptelet in all geographies while Immunology was held back by tough comparisons for Kineret due to lack of COVID sales and/or Gamifant sales. From a regulatory point of view, we saw highest growth in the rest of the world driven by Doptelet in China, [indiscernible], it's increased well and in sales of our medicines.

Overall, in Europe and in the U.S. was held back by Kineret compared to the Gamifant, while sales by Aspaveli and Doptelet launches. We are pleased to see the increase of performance revenues coming from Rest of World, or as we call it, International, as it helps to diversify the revenue base and it all helps more people gain access to Sobi medicine. In 2023, we anticipate several approvals and launches of region for driving global [indiscernible].

Let's move on to Slide #6. Turning to Haemophilia, we saw continued relative stability. So the performance here is spot on our expectation and commitment [Technical Difficulty] to continue this year. Elocta increased by 6%, timing of orders boosted sales. There was growth in patients [Technical Difficulty] but they also realized lower price across Sobi countries. We think factor consumption in 2022 in general reached pre-pandemic levels.

Alprolix increased by 1%. More patients and consumption offset by lower price. We see relative stability to continue in 2023, driven by new countries and [ offsetted ] by price.

Doptelet had the best quarter [Technical Difficulty] trends continuing, up to 72% excluding China. In the U.S., trends continued. More new patients, new prescribers and higher share and longer duration of treatment are the main reasons. Market share gains are mainly from the injectible competitor. And in Europe, Germany continues to be the biggest driver, supported by recent reimbursement. Sales reached more than SEK 300 million in China. We expect a tough comparison this year, with potential for lower sales depending on how the competitive situation looks.

Let us turn to Slide 8. The launch of Aspaveli continues to grow as its quarterly sales approaching SEK 100 million. We have launched in Germany, the U.K., France and parts of the Middle East, with early sales in a number of countries where the reimbursement is starting to come in one at a time. We increased to approximately 100 people on commercial supply by the end of December, and in line with our commitment, our official [indiscernible] number shared at past conference calls.

Turning to Immunology, Kineret declined due to tough comparisons in 2021 due to COVID sales. In one COVID quarter, Kineret release is tough COVID comparison and move on. Gamifant sales are lower, but saw a sequential decrease from the second quarter. Gamifant has reached high adoption in the U.S. and declined mainly due to lower use in adults.

We focus on the life cycle management work for Gamifant and recruitment into the [Technical Difficulty] later this year.

Let's turn to Slide #10. Now Synagis, we saw the RSV season start a little later than in 2021, but sales in the fourth quarter caught up with 2021. There's also an element of price benefit in the performance. U.S. RSV infection have decreased, so we still think it is realistic to expect an overall season that will follow the pattern closer to a normal season than in 2021 with a lower first quarter.

I will now hand over to Henrik, our CFO, for the financials. Please go ahead, Henrik.

[Henrik Stenqvist, executive]

Thank you, Guido, and hello, everybody. So please turn to Slide 12, and I'm pleased to take you through the key financials for the fourth quarter and full year '22.

Starting with the top line. Q4 revenue of almost SEK 6 billion was the highest ever as reported in SEK, with benefit both from performance but also currency. The reported growth was 22% and growth at CER, 5%, which gave the full year growth at CER of 8%, in line with our full year guidance.

Looking at the bars to the left, we saw continued sequential growth in Haematology driven by the strong performance of Doptelet, as well as the seasonal boost in Immunology due to Synagis.

Back to the table, the gross margin in the quarter of 78% decreased slightly from a year ago due to the lower gross margin associated with sales of Doptelet to China, partly offset by FX.

The EBITDA margin realized was 41%, equal to the same period last year, and there were no items affecting comparability in this quarter. Although operating expenses, as expected, increased in Q4 versus previous quarters, the EBITDA margin of 41% was supported by good cost control. With operating expenses growing by 4% at CER, excluding amortizations, and this compared with a revenue growth of 5% at CER for the quarter, as I just mentioned.

Earnings per share for the quarter ended at 4.68%, representing a growth of 11% versus Q4 '21.

Operating cash flow was seasonally strong in the quarter and amounted to SEK 1.9 billion, reducing net debt by more than SEK 2 billion in the quarter to SEK 7.4 billion. And this corresponds to a net debt-to-EBITDA ratio of about 1.1. For the full year, operating cash flow reached close to SEK 4.7 billion, which is close to 80% of reported EBITDA. And as stated before, we anticipate milestone payments coming our way. For Q1, we expect to pay $175 million for nirsevimab and $50 million for the approval of loncastuximab tesirine.

For details on items affecting comparability in the year, please see Page 3 in the report or the appendix to this presentation.

If we then move to Slide 13, I will now turn to the financial outlook for 2023, which is on revenue growth at constant exchange rates and adjusted EBITDA margin. So the same principles as in 2022.

We will continue to expand our presence in Haematology, Immunology and Specialty Care through ongoing launches, new medicines and geographic markets, and we anticipate sustained sales growth. So revenue is anticipated to grow by low-to-mid single-digit percentage at CER. And as we continue to invest in launches and advance the pipeline of new medicines and emphasize the long-term value of the business, we expect to keep a favorable EBITDA margin. So the EBITDA margin adjusted is anticipated to be at the low 30s percentage of revenue, and this outlook continues to exclude any elements of our rights to the full share of U.S. profits and losses for nirsevimab.

And with this outlook for '23 covered, I now hand over to Anders for the pipeline. Thank you.

[Anders Ullman, executive]

Thank you very much, Henrik. Hello, everyone. I will now take you through pipeline highlights and news flow. So turn to Slide 15, please.

When it comes to the pipeline, we saw more milestones reach in the fourth quarter. Doptelet was submitted for regulatory review in China for the ITP indication. It's already approved for chronic liver disease. Zynlonta, which is a new name for loncastuximab tesirine, was approved in the European Union, and Kineret authorized for emergency use in COVID-19 in the United States. Finally, nirsevimab was accepted for regulatory review in the U.S., which was announced in January by AstraZeneca and Sanofi.

As a reminder, Sobi has the right to AstraZeneca's full share of U.S. profits and losses for nirsevimab.

Please turn to Slide 16. Staying on the science in Sobi, the ASH meeting in December displayed a breadth and depth of Sobi in Haematology. Efanesoctocog alfa highlights included new data on physical functioning and pain from the XTEND-1 Phase 3 study. Doptelet had data looking at length of therapy and persistence, areas where we see clear differentiation for our medicine versus competition. On Aspaveli, new data was shared on long-term safety in PNH and more intense dosing schemes and study in progress in cold agglutinin disease. Zynlonta had new data shared from the LOTIS development programs by ADC Therapeutics. And on Gamifant, we had the first look at the REAL-HLH study providing details on the real clinical utility in HLH.

As the Head of Research and Development, it was nice to see the extensive presence at the meeting and being able to imagine the benefits that existing and new evidence can bring to people with rare and debilitating diseases.

Please turn to Slide 17. Last month, the first Phase 3 study for efanesoctocog alfa was published in the New England Journal of Medicine. Together with our partner, Sanofi, we were pleased with this milestone for the XTEND-1 study. The publication confirmed the clinical benefits of efanesoctocog alfa, and the editorial was very supportive of the benefit this new medicine can bring to people with Haemophilia A.

Next up is the data readout from the XTEND-Kids, the second Phase III study in the first half of this year, and the EU and other Sobi regulatory submissions in the second half of 2023.

Please now turn to Slide 18. Now looking ahead, we are into a new year with increasing news flow from the Sobi pipeline. During the first half, we can expect regulatory decisions in the U.S. for efanesoctocog alfa as well as the readout of the second Phase III study required for the EU regulatory submission.

Doptelet and Aspaveli are both awaiting regulatory decisions in Japan, and we are anticipate Phase III data from Gamifant in a new setting, as well as 2 Phase III studies for SEL-212.

And in the second half, we will see some of the data readouts as mentioned convert into regulatory submissions, as well as average regulatory decisions in China for Doptelet and Kineret. We will also see if there is any utility of Aspaveli in ALS or Lou Gehrig's disease, and [ wait ] to see from AstraZeneca and Sanofi when nirsevimab is approved in the United States.

In 2024, there is more to look forward to. All in all, it's going to be busier for the pipeline in 2023, and we look forward to sharing the news with you and see how we can further help people with rare diseases.

Before I close and hand back to Guido, I would like to say thanks to everyone in Sobi who have helped advance science and care for people with rare and debilitating diseases.

Now back to Guido. Thank you.

[Guido Oelkers, executive]

Thanks, Anders. So in summary, 2022 was a good year, and we can look forward ahead to a solid future here at Sobi. So we are pleased about the progress we have made last year and the outlook provided for 2023. The business is in a good shape and growing the pipeline of new opportunities continued to progress well, with a busier news flow in 2023. As Anders said, it's well thanks to everyone at Sobi, who made this possible, and we hope to continue to provide good news for patients also this year as we move forward with Sobi.

Please turn to Slide #21. We now go to the Q&A. [Operator Instructions] Perhaps now we can take the first question from the conference call.

[Operator]

Our first question comes from Christopher from SEB.

[Christopher Uhde, analyst]

Christopher Uhde from SEB. I apologize if there is [Technical Difficulty] for you guys as well.

So my first question is related to pricing adjustments. So could you please give us a little more color on the retroactive pricing adjustments on Haemophilia products? And also -- so I mean, I guess in the context of what we've heard about the new market access reform impact, so particularly AMNOG and the U.K. rebate? That's my first question.

And then the second question is related to Synagis. What -- can you tell us about your thoughts for Q1 given the drop-off in the season? I caught that you said that you expect a more normal Q1 than the prior year, but what factors give you confidence in that? And then for Q4, given the likely launch of Beyfortus ahead of the quarter, what can you tell us about the impact of sales erosion on the product's gross margin? I guess, are you thinking -- well, so in a hypothetical scenario, they were -- you lose half your sales, would we be talking on the order of 10 percentage point lower gross margin for Synagis, or would it be closer to 2 percentage points, or -- what can you tell us that can help?

[Guido Oelkers, executive]

Yes. Thanks, Christopher. I mean, let's start with the easy bit.

I mean, there was a retroactive price adjustment, but this is 2 years ago, and we don't anticipate a retroactive price adjustment from recent initiatives in Europe. What we expect, though, is some headwinds, and that's the reason why also it's part of the reason why we are a little bit more cautious because we obviously see continuous patient growth across the board, also in Haemophilia. But we probably will -- we will face some headwinds there, and that's the reason why the outlook is covering this. I don't think we will provide here an in-depth outlook, but we will see some headwinds in Europe that will obviously suppress, let's say, sales.

I think no doubt -- and you mentioned quite a few of those initiatives. And this will affect us. It's early, early stage, but what we can see and we have scoped out that the momentum we have across the portfolio should compensate or overcompensate those effects.

With regard to Synagis, I mean, the -- we went through quite extensive outside-in research, and how to think about it. And basically, what we can see is that the second part of the '22, '23 season is probably more following a normal pathway that you would have seen in the 2020 pre-COVID scenario in 2019, probably, and where the second part of the season is always a little bit weaker than the first part. And -- but we have granted that the virology is changing, but don't forget these are very, let's say, fragile babies even in the, let's say, second part of the season. And obviously, there are quite a few newborn as such. So we don't expect here, let's say, something in the extraordinary. Just more following a normal pathway.

And with regard to the -- and basically the -- obviously, it's driven also by adherence, let's say, to the 5 cycles, and a lot of babies have been dosed now. So the -- and compliance in recent history was quite good. I mean, if anything, the epidemic levels of COVID and others have taught us that we should take those vaccinations seriously. So I think that is -- we're actually quite optimistic that we will have a decent finishing of the 2023 season. And hence, we -- the impact on gross margin, at least for the first quarter, we don't see if coming -- major deviation coming here from Synagis versus the right comparison.

And moving forward, on the, let's say -- on how this is going to play out. I mean, we think that, let's say, we will obviously maintain a large chunk of the Synagis business in 2023, given also the late launch of the new competitor, and we have done their various scenarios.

I think maybe this is -- I stop here, and we open up for more questions, and happy to come back to this some other time. Thanks.

[Operator]

The next question comes from Kyung Yang from Jefferies.

[Eun Yang, analyst]

So I have a question on Beyfortus. But before that, I want to ask you on 212.

So we are expecting Phase III data in the first quarter of this year. Can you remind us what are the kind of differentiating aspect of the product we see compared to Krystexxa in the trial or the trial is compared to placebo? And in the U.S., the Krystexxa side running over $700 million annually. How do you see the European opportunity?

[Guido Oelkers, executive]

Yes. I mean, maybe I'll start with the commercial element of your question and then also give an outlook, and then maybe Anders can talk about the trial in a few seconds.

So with regard to SEL-212, obviously, we'll have to wait, hold our horses. I mean, you will see an effect size, let's say, in -- of SEL-212 that will be basically that even though the data are not comparative, as you rightfully pointed out, I mean, we will still have a look at the absolute effect size and compare it, obviously, this is what Krystexxa has achieved. I think for us, to be honest, this trial is all about meeting primary end point, and which hopefully we are going to make. I mean, otherwise, we have a problem. But that basically is the main theme.

And then the question is going to be, what are we going to do with this data, and how do we see our positioning then versus Krystexxa? I mean, you have seen the data from the Phase II, but we got a little bit unlucky on the primary endpoint, but got some good numerical data differences in various aspects.

So I think it's -- we always said this is a commercial product. Let's say that we can sell, and we can -- and we think that we can make a dent. But it's a bit early at this stage. We would rather wait now to guide when we have seen the Phase III data. And let's say -- and give you then a bigger -- better picture.

Anders, you want to quickly comment on the study design? Yes, for the study?

[Anders Ullman, executive]

I'm happy to.

First of all, the product, this is the co-administration of 212, which is 2 components, which is -- you kind of speculated in its same principles as Krystexxa and in addition, a select proprietary-developed immunomodulator to give a better protection from neutralizing antibodies. The study -- the Phase III studies with more or less identical design are placebo-controlled studies and a study population that is similar to what we have said before and with a significant part of the population being [indiscernible] patients, et cetera.

So the goal is, of course, to demonstrate safety and efficacy at a competitive level over placebo and documented tolerability of this combined treatment, which we are confident that we will meet. And it's also pointed out that this is done a -- in less frequent and therefore, for patients, more convenient therapy. So a relatively straightforward Phase III program, in my view.

[Guido Oelkers, executive]

Yes, so I think we are quite hopeful that we have a positive outcome, but we would like to wait for the data first and then guide you. But I mean, we always said this is a product that we can sell. At this point, we have no indication any otherwise.

And then you had a question, I think, regarding Beyfortus, Eun?

[Eun Yang, analyst]

Yes, yes.

So Sanofi set that for Beyfortus third quarter, but they are hoping to get approval before the June CDC ACIP meeting schedule. So in the event that it's approved earlier and then Sanofi is able to launch preseason, would you update your guidance for this year?

[Guido Oelkers, executive]

Yes. I mean, we -- at this stage, we -- I mean, our guidance is obviously dependent a little bit on how much you would expect from the product. I mean, it's a bit of a -- there are various scenarios that we played through and it's -- they are dependent on, obviously, on the launch. They are dependent on the time we have to those patients. They are dependent on the labor as such, when we asked people who used to be involved with those decisions. And then they are dependent, obviously, on their ability to basically manage this kind of very significant complexity of the launch.

Now this is the largest -- used to be the largest company. And let's say, so -- there are quite a number of factors that need to be considered. I think it's a bit early for us and -- to change any outlook. I think we will reassess this when we have a good grasp on how this will affect all those different parameters.

And -- but the good news is that we're actually quite insulated, and there are scenarios where we could have -- end up with a significant upside there. Some scenarios where we have -- which we think are unlikely, we could have a downside. So what we used here in our assumptions is a base case, and let's see how it plays out. So we are not, at this stage, giving any indication on the new reassessment.

Maybe we move on then to the next person. Sorry, yes. So [ Eun ], let's move on to the next question.

[Operator]

And the next question comes from Sarita Kapila from Morgan Stanley.

[Sarita Kapila, analyst]

Similar in speaking on nirsevimab, if it's not approved in time for the start of the RSV season, so the date [ sensitive ] as you said. To what extent is your guidance conservative, and should we be thinking about a mid-30s margin in line with 2022?

And then secondly, just on Doptelet. Are you able to update us on the situation in China? How many generic players are pursuing Doptelet, and what level of sales revenue should be factoring [ post-BBP ] inclusion?

[Guido Oelkers, executive]

Let's come to Synagis and nirsevimab. Obviously if there would be a miss in the season, we have anticipated some effect on Synagis. And yes, I mean, the point is if you sell more Synagis, we're going to make money, more money. And if they are not there for the season, I mean, we have no indications why we should not have then a normal year, yes? And that to -- do as well.

Do we reach 2022 level? Well, we don't know at this juncture because it will depend also on the virology as such, so. And it is, again, not the time now to give new guidance. But clearly, just looking at the factors, it would do as well, yes.

The other thing on Doptelet, yes, the ITP submission is, I think, is opening up a very significant opportunity horizon for our partner, Fosun. Obviously, there's a risk which currently is not the case that there will be generic competition affecting the business. To what degree? It's speculative. I mean, you need to realize, obviously, that Fosun is a very formidable force in a Chinese context. And the sales we are seeing in our books are the sales to Fosun, not the sales in market. And we will have to hold our horses to see, but we just point out that there could be a negative effect. But there could be also obviously some positives if Fosun goes for a broader indication because the only indication is -- currently approved is [ COD ]. So it's a -- there is a bit of uncertainty, but there are -- there could be some negative knock-ons because of generic competition that may arise. Or either there could be a positive, obviously, also from a broadening of the indication. And -- but we are very confident, obviously, that we have a strong partner at our side, so who is -- who can manage this business very well.

Maybe the next question.

[Operator]

Our next question comes from Mattias Haggblom from Handelsbanken.

[Mattias Häggblom, analyst]

So I have 2 questions, please.

Firstly, with regards to efanesoctocog alfa and risk for development of inhibitors. I noted in the New England Journal Paper, no trace of inhibitors in the XTEND trial. However, given the complexity of the molecule and potential exposure of new epitopes at the [indiscernible], I'm curious to hear you're thinking about the risk for inhibitors in the ongoing Kids trial? And to what extent the DSMB has already provided insight to this topic, given the open-label nature of this trial?

And then secondly, if Henrik could help us think of the net financials for the year, I'm yet to see details on the maturity and structure of your debt from your upcoming annual report. So is the Q4 run rate a good way to think of net financials for '23 per quarter? Or to what extent do you have debt maturing repriced at higher interest rates during '23, making a more gradual increase also likely for '23?

[Guido Oelkers, executive]

Yes. Maybe we start -- Mattias, thanks for your question. Maybe I refer to Anders, and he can update us on what he expects on inhibitors from the children trial. I mean, Anders, maybe you fire off, and then we give it to Henrik.

[Anders Ullman, executive]

Yes. This is, of course, an ongoing, well-controlled blinded study where we -- of course, we are following safety, et cetera, as normal. But there is -- we have no reason to believe that it would be less safe or less efficacious in kids than in others from our understanding of the mechanism, et cetera. We can, of course, not comment upon the trial outcome, as it's still ongoing and not analyzed yet, so.

[Guido Oelkers, executive]

Yes. So I think we don't expect anything in the unusual. Obviously, when you expose kids to it for the first time, there could be inhibitor development as it is with every other factor product, let's say. But it's too early to speculate, but we think that efanesoctocog alfa will sail through.

Maybe, Henrik, you can comment on the net sales in Q4?

[Henrik Stenqvist, executive]

Yes. Regarding the finance net, yes, we do have maturities in Q4, but we don't really expect any impact on financial net coming out of those maturities. I think Q4 is a reasonable proxy. We don't know what interest rates will do to us in 2023, but I think it's a reasonable proxy. We have, of course, an expected strong cash flow in 2023, but we also have significant milestones coming up during the year.

So in Q4, reasonable proxy.

[Guido Oelkers, executive]

Yes. Thanks, Mattias, and maybe then we go to the next caller. I think it's Lars from Danske.

[Operator]

That's correct. The next question comes from Lars Hevreng from Danske Bank.

[Lars Hevreng, analyst]

Yes. I just wonder if you could tell a bit about planned launch activities for Zynlonta? I mean, they recently in-licensed ADC product from ADC Therapeutics. Tell us a bit about the launch priorities, which countries would you launch in, when and what kind of pace up do you see on that product?

[Guido Oelkers, executive]

Yes. I mean, we -- the first launch country, it wouldn't surprise you, is Germany in Q2. Currently thinking about [ Moema ], and then we -- I mean, it's going to be a gradual ramp up. I think we have -- also in terms of resources, we have a lot on the plate right now with, obviously, with pegcetacoplan plan, with Doptelet launch in Europe, so you want to manage this.

But product is, as we always said, is a good opportunity that we consider more as a haematology product than an oncology product that we -- let's say, that we see as a nice addition. But it's not, let's say, the main theme for us, yes? But -- so we are quite hopeful for the product. We had quite a number of KOL meetings. So there is a clear medical need, and KOLs are waiting for the product. So we think we can sell it, but I think for this year, I want to manage expectations, this is not going to be the main commercial event. And then anyway, we have to get also reimbursement in other markets as we follow.

[Lars Hevreng, analyst]

Okay. And can I just follow up on nirsevimab? Disregarding when Sanofi is going to launch, et cetera. And I assume whenever they will launch, will you incur your share of the results, so to say, on the product, irrespective -- or whether it's a profit or a loss?

[Guido Oelkers, executive]

Yes. I mean, this is -- as of launch, we will be in for the launch cost, the commercial cost. And we will share, we will -- and Henrik can comment on this, we will consolidate this business on a gross basis. And so we will -- but it could negatively affect our earnings that's for sure. Considering the product and the simulations we made, considering that it will very likely a product for a very, very large target audience, we consider these investments as a happy problem in view of -- when you look at it from a discounted perspective.

Yes. So maybe we go to the next caller, I think it's Erik from Carnegie, if I'm not mistaken.

[Operator]

That's correct. Next question comes from Erik Hultgard.

[Erik Hultgård, analyst]

I have 2, if I may. First, on the guidance that you provided in the end of 2020, the 25 by '25. And I was just wondering if -- how we should look at this guidance, if it still reasonable to believe you will hit this target? I know part of this guidance included accelerating growth in margins from '23, including double-digit revenue growth from '23, and that seems to stand in contrast with the outlook provided today. So just curious to understand what sort of have been -- what products or what parts of the guidance had performed better, and what parts have underperformed since you provided that guidance?

And then -- sorry. Then finally [indiscernible], maybe a question for Henrik on CapEx, on top of the [ 175 ] for nirsevimab and 50% loan, what more should we expect for CapEx -- driven CapEx this year and potentially next year? Sorry, that was a long question, but...

[Guido Oelkers, executive]

I appreciate it. I mean, the -- if I'm not mistaken, Erik, when we made this outlook, provides this vision, I mean, we said 25 by '25, and we had an error margin there of 10%, let's say, that we allowed for. And obviously granted that this was made at a time when nobody saw that Russia would invade Ukraine and COVID was a very far away idea, and let's say, so -- but bottom line is we still have 3 years, yes, let's say, to fulfill this mission, let's say.

And I appreciate that obviously, on the earnings side, when you look at it today, that -- and we have made a guidance. And what can I say? The guidance would not point you into leverage right now, yes? So that is a deviation where that's what we said, let's say, at that time. And let's say, this was also at the time when we thought we had, as you know, the CIT indication in the bank. And let's say -- so a few things have changed.

Overall, I think the business is doing quite well. I mean, when you think about a SEK 2.5 billion business for Doptelet, I don't feel actually ashamed. I think it's quite a nice uplift. And at this stage, I think what we also need to see is to what degree can we give Gamifant an additional push now with the help of new data. And there, we saw it obviously at that time, probably that we were a little bit further ahead.

But overall, the business has held quite nicely together. I mean, there were quite a few people who saw that we would not -- towards the [indiscernible] in haemophilia and we're projecting a lot of [ Cassandra ] scenarios, what is going to happen. I mean, it didn't happen. We grew the business. We increased the patients, so I think this is how I would like to bring it into perspective.

So give us a bit more time. This is where we are at this point of time. The good news is that we have a lot of opportunities to invest, yes? And that's basically what we are now doing, building a very strong future.

Maybe to the other question, Henrik?

[Henrik Stenqvist, executive]

Yes, regarding the upcoming milestones. So in addition to what I mentioned regarding the nirsevimab payment in Q1 and the Lonca payment also in Q1. We have some milestones there to Eisai related to Doptelet sales coming up, and there is also a payment for the approval of nirsevimab.

So that's close to SEK 4 billion for 2023, and in '24, the major 1 expected to come up is, of course, the approval in Europe of efanesoctocog alfa.

[Guido Oelkers, executive]

Very good.

[Erik Hultgård, analyst]

Thanks a lot Henrik. Just on Selecta. Is there any payment to Selecta coming up, given that they are quite advanced in that program?

[Henrik Stenqvist, executive]

Yes, there are, but not so significant.

[Guido Oelkers, executive]

I mean, maybe we keep up the beat and move to Alistair from Royal Bank of Canada, and -- straight away.

[Operator]

Yes, we do. Next question from Alistair.

[Alistair Campbell, analyst]

Just a couple. First one is just on the Specialty Care segment, fairly small. But just in terms of the EBITDA margin there, which is down about 10 percentage point year-on-year. So just to get a sense of how -- is that settled there, can it recover, or what's the outlook there?

And then just a follow-up on Gamifant, touched on the [ MEs ] approval. I mean, can you give us a sense of what sort of uplift that could be from the current indication in terms of sales potential?

[Guido Oelkers, executive]

Yes. I mean, maybe I'll start with the easy bit, the Gamifant one, and then I don't think we really got the acoustics of your first question.

But maybe coming from first very quick, let's say the patient potential for the indication at stake is, give and take, 3x of what basically the labor in the strictest sense is what we have right now. So it's quite substantial.

And Henrik, maybe you can talk about the -- I mean, maybe you can refine your question, because I think we didn't really get it? I think it was -- acoustically, it didn't come across, Alistair, maybe you can repeat it?

[Alistair Campbell, analyst]

The first question?

[Guido Oelkers, executive]

The first question. I mean, we didn't get the first question properly, I think.

[Alistair Campbell, analyst]

Yes, sorry. I was just looking at the divisional EBITDA margin for the Specialty bit, which is year-on-year down from about [ 32% ] to [ 32% ]. Just to get a sense of where that could go from here? Is that ideal, does it improve, or is that where it's going to stick? It's a fairly small part of EBITDA.

[Henrik Stenqvist, executive]

Yes. So when it comes to the Specialty Care segment, that is, of course, under pressure. And the decline of Orfadin has, for sure, an important EBITDA impact because that is still a profitable product. That's the main reason.

[Guido Oelkers, executive]

Yes. And maybe with this, we go to Peter from Pareto as the next one, given the -- that we are running a little bit out of time.

[Operator]

Yes. Peter, please go ahead.

[Peter Östling, analyst]

Okay. Just 2 quick ones regarding Beyfortus. Firstly, did you say that you included some cannibalization on Synagis in your 2023 outlook?

[Guido Oelkers, executive]

That's correct, yes.

[Peter Östling, analyst]

Okay, great. And then you've been saying that you're working with different scenarios regarding the Synagis and nirsevimab, how did that pan out? Have you had any discussions with your auditors around the SEK 11 billion intangible that you have for synergies on your book right now, how you will deal with that going forward?

[Guido Oelkers, executive]

With the first part, we obviously had the discussions and basically feel that we understand the opportunities reasonably well.

Maybe Henrik, on the auditor discussion?

[Henrik Stenqvist, executive]

Yes. It's Synagis and its follow-up, nirsevimab, as well as 1 item. So it's 1 unit of accounts. So it's not like we expect to -- an impairment of Synagis because of nirsevimab.

[Peter Östling, analyst]

Okay. But do you expect that they will level out?

[Guido Oelkers, executive]

I mean, historically, we have guided, Peter, that we are more optimistic for the profit streams from nirsevimab in comparison to what we expect, what we realized from Synagis as a consequence. The answer is yes.

So -- you're welcome. So maybe we go to the next guy to call up. It's Viktor, I think, from Nordea.

[Operator]

That's correct.

[Viktor Sundberg, analyst]

From Nordea, congrats on the quarter. So on nirsevimab, just wanted to dig a bit into your agreement with AstraZeneca for the U.S. market. So the agreement seem to include that AstraZeneca is titled to an additional royalty from you if profits exceed a certain level in the U.S. Can you give any guidance how much headroom you have until that royalty component from AstraZeneca will kick in for you guys in the U.S.? And maybe what's that all about also?

[Guido Oelkers, executive]

Viktor, I think -- we don't think that we have to pay royalties, no.

[Viktor Sundberg, analyst]

Okay. On the same topic, that is RSV, I also wanted to get some more color on your comment that favorable price effects help during the quarter. Is that price hikes you're talking about, and can you comment if that will follow you through into 2023? And then I have a quick follow-up as well.

[Guido Oelkers, executive]

Price hikes in -- with regard to which part of the portfolio, sorry?

[Viktor Sundberg, analyst]

Sorry. For Synagis, you said that there were some favorable price effects that you talked about in your slide. I just wanted to get some more color on that.

[Henrik Stenqvist, executive]

Viktor, those price effects are mainly related to gross to net. So it's not -- in Q4, there are no price increases in Q4. It's gross to net.

[Guido Oelkers, executive]

Yes, because you make certain assumptions on the mix to whom you are selling, and then you have obviously -- depending on how the mix is turning out, you have variances.

[Viktor Sundberg, analyst]

Okay. Yes. And also on the EMERALD study here quickly. Have you got any feedback from the agency, said anything about how many patients that you need to achieve a complete response for you in this study to be enough for supporting an added label?

[Guido Oelkers, executive]

We got this feedback.

Anders, you want to comment very quickly?

[Viktor Sundberg, analyst]

Yes, if you got any feedback from the FDA, how many patients that need to reach a complete response in the study for it to be enough for a supplementary label?

[Anders Ullman, executive]

I don't think I have any numbers that I can share there today.

[Guido Oelkers, executive]

Yes. Let's move to the next caller, and this is Jon Berggren from Kepler, yes?

[Operator]

That's right. Jon Berggren from Kepler Cheuvreux.

[Jon Berggren, analyst]

I have 2 on Synagis. So at the last ACP meeting, Sanofi and AstraZeneca presented 4 efficacies and safety data from MEDLEY, this was in the cohort of CLD and CHD patients. So first, I was wondering if you could share your thoughts on that data? And then secondly, if you could give us a rate of how many patients that received Synagis in 2 seasons over just the 1 season? Those were my questions.

[Guido Oelkers, executive]

I mean Synagis normally, let's say, give and take, 50,000 patients plus/minus, yes, this is what we have in a normal season. In MEDLEY, with regard to the MEDLEY study, I think the key question is there, will -- because it's obviously safety data, no efficacy and to what degree, then -- and this was allowed in the European context, can those data be extrapolated to our study or to our population that is on label, yes? I think that's the main question with regard to Synagis, but we don't know how this question will be addressed as a privilege of the committee.

Yes, I think we keep up the beat. And I think that maybe we end with the last question from Christopher from SEB.

[Operator]

Yes. Christopher, he's now on the stage.

[Christopher Uhde, analyst]

So my question is on the Gamifant lupus cohort in the study, when we expect to see that readout? Because it's not in the table anymore. And then that and the other cohorts, what's the pathway look like for approvals for the EU and Japan, and what's the current status in China?

[Guido Oelkers, executive]

Good. Anders, you want to take it?

[Anders Ullman, executive]

Yes. There were several questions there.

So I -- first of all, our main focus on [indiscernible] now is to get the patients requested from the first cohorts in Still's disease to facilitate the submissions due to completing the remaining part for making the submission for secondary HLA in Still's patients.

The second cohort is ongoing. We have the first patients recruited, SLE patients with SLE. It's a tough recruitment goal, but we are optimistic that we will move on. We have not communicated this in time line on that, and -- but we -- I think we will come back with that in later updates when -- but right now, the main focus.

In terms of the -- in European, we are engaging. First of all, we are getting a lot of interest, and then access requests, et cetera, from European key centers. And we're looking, of course, with additional data in new times to see if we can reconsider the primary situation in Europe. And we will -- when we have the outcome of the of the secondary study also, also map out the regulatory strategy for other territories. We know that we will probably need slightly more patients, so the study goes there. Also, the first cohort goes is beyond what is requested for FDA in that process.

So we can't give you details there yet. But of course, we are committed to make Gamifant available for as many patients as possible, both with primary and secondary HLH in as soon as possible.

[Guido Oelkers, executive]

I think if you round it off, I mean, we think that we are not too far away anymore from where we need to be, let's say, with the EMERALD study to have something to submit to FDA.

So basically, when you look at it in summary, for 2022, I think it was a good year. We can look forward to a solid future, and we're obviously quite gratified that we made good progress last year and have quite a bit of momentum now for 2023. Business is in a good shape. We are growing the pipeline. You've seen in a table there on the news flow, we think it's quite material to ask what happens in the next half year and a lot of good news are hopefully coming and new opportunities. And that basically means we will be quite busy with the business, but also with what we are going to do in the part run in 2023. Thank you so much for your interest and apologies that we overran a little bit in time and if you have questions you know who to call, Thomas is here and is happy to connect you and we will address any information request that you may have. Thank you so much. Wish everybody a great day.

[Operator]

This now concludes our presentation. Thank you all for attending. You may now disconnect.