Good morning and thank you for standing by. Welcome to the AbbVie Fourth Quarter 2024 Earnings Conference Call. All participants will be in a listen-only mode until the question-and-answer portion of this call. Today's call is also being recorded. If you have any objections, you may disconnect at this time. I would now like to introduce Ms. Liz Shea, Senior Vice President of Investor Relations. Ma'am, you may begin.

Thank you. Good morning, and thanks for joining us. Also on the call with me today are Rob Michael, Chief Executive Officer; Jeff Stewart, Executive Vice President, Chief Commercial Officer; Roopal Thakkar, Executive Vice President, Research & Development, Chief Scientific Officer; Scott Reents, Executive Vice President, Chief Financial Officer; and Carrie Strom, Senior Vice President, AbbVie, and President, Global Allergan Aesthetics. Before we get started, I'll note that some statements we make today may be considered forward-looking statements based on our current expectations. AbbVie cautions that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated in our forward-looking statements. Additional information about these risks and uncertainties is included in our SEC filings. AbbVie undertakes no obligation to update these forward-looking statements, except as required by law. On today's conference call, non-GAAP financial measures will be used to help investors understand AbbVie's business performance. These non-GAAP financial measures are reconciled with comparable GAAP financial measures in our earnings release and regulatory filings from today, which can be found on our website. Following our prepared remarks, we'll take your questions. So, with that, I'll turn the call over to Rob.

Thank you, Liz. Good morning, everyone, and thank you for joining us. Our fourth quarter performance closes out another excellent year for AbbVie, and I'm very pleased with the significant progress we made in 2024. We executed on our top commercial priorities, advanced our pipeline with key regulatory approvals and promising data, and further strengthened our business through strategic transactions. Turning to our results, we delivered full-year adjusted earnings per share of $10.12, which is $0.49 above our initial guidance midpoint. Excluding the impact of IPR&D expense, total net revenues were $56.3 billion, exceeding our initial guidance by more than $2 billion. Our results demonstrate a rapid return to sales growth, with full-year revenue up 4.6% on an operational basis, despite $5 billion of U.S. Humira erosion in 2024. This outstanding execution is driven by our ex-Humira platform, which continues to outperform expectations, delivering full-year sales growth of more than 18% with revenue growth accelerating to 22% in the fourth quarter. As I look to 2025 and beyond, we are well-positioned with our ex-Humira platform. It will allow AbbVie to deliver robust mid-single-digit revenue growth in 2025 and exceed our previous peak revenue in just the second year following the U.S. Humira LOE. And given that we have no significant LOE events for the rest of this decade, we have a clear runway to growth for at least the next eight years, including a high single-digit revenue CAGR through 2029. We anticipate a substantial portion of this growth will be driven by robust performance from Skyrizi and Rinvoq; these assets are expected to collectively generate nearly $24 billion of revenue in 2025, reflecting growth of more than $6 billion. Based on this strong momentum, we now expect Skyrizi and Rinvoq to exceed more than $31 billion of combined sales in 2027, which is $4 billion above the guidance we provided last year. We are seeing strong performance across all of their approved indications, especially in IBD. We see several tailwinds that will support growth into the next decade, including healthy immunology market growth, strong share capture given best-in-class profiles, continued robust market access, and momentum from new indications, such as the recent launch of Skyrizi in UC, as well as the potential for five new indications for Rinvoq over the next few years. In neuroscience, our second largest therapeutic area, we are seeing very robust performance, with sales of $10 billion expected in 2025, reflecting growth of $1 billion across psychiatry, migraine, and Parkinson's. In oncology, I am very encouraged by our long-term growth prospects. This includes our BCL-2 inhibitor, Venclexta; our FRα ADC for ovarian cancer, Elahere; and our two novel c-MET ADCs for solid tumors, Teliso-V and 400, and our BCMA-CD3 bispecific for multiple myeloma 383. Lastly, while the recent performance in aesthetics has been impacted by challenging market conditions in the U.S. and China, the category remains very attractive given low penetration rates for facial injectables. When the market returns to more normalized growth, our leading commercial portfolio and forthcoming pipeline will help drive improved performance. Based on the market trends over the last few years, and our assumption for a gradual recovery in the near term, we now expect aesthetics to deliver a high single-digit revenue CAGR through 2029. Turning now to R&D, we have made excellent progress with our late-stage programs. These advancements include recent approvals for Skyrizi in UC, Epkinly in later lines of follicular lymphoma, Elahere for FRα-positive platinum-resistant ovarian cancer, Vyalev for advanced Parkinson's, and new indications for Botox and Juvéderm. In 2025, we anticipate approvals for Rinvoq in GCA, and Teliso-V for non-squamous, non-small cell lung cancer, as well as regulatory submissions for Tavapadon in Parkinson's, Venclexta in higher-risk MDS, and BoNT/E for aesthetics. We have also added depth to our pipeline by signing more than 20 early-stage deals since the beginning of 2024, including promising technologies and innovative mechanisms that can elevate the standard of care in immunology, oncology, and neuroscience. We have significant capacity to continue pursuing external innovation with a focus on differentiated opportunities that can drive growth in the next decade. In summary, I am very pleased with AbbVie's execution in 2024. And expect our diverse portfolio to drive strong growth in 2025 and beyond. With that, I'll turn the call over to Jeff for additional comments on our commercial highlights.

Thank you, Rob. I'll start with the quarterly results for immunology, which delivered total revenues of approximately $7.3 billion, exceeding our expectations. Skyrizi total sales were nearly $3.8 billion, reflecting operational growth of 57.9%. Rinvoq total sales were more than $1.8 billion, reflecting operational growth of 47.1%. On a full-year basis, Skyrizi and Rinvoq delivered approximately $17.7 billion in total combined revenue, an impressive increase of nearly $6 billion year-over-year, exceeding our expectations. These results reflect strong performance across all approved indications. I'll share some highlights in the U.S. Skyrizi total prescription share in the biologic psoriasis market is now approximately 40%, reflecting a very significant lead relative to all major competitors, with in-play capture rates remaining very strong. Over the course of 2025, we anticipate new data for Skyrizi on hard-to-treat areas of the body, including scalp and genital psoriasis. In addition, we expect the readout of our fifth head-to-head study in psoriasis comparing Skyrizi to Sotyktu, which will continue to differentiate the brand versus oral competitors. Rinvoq is now capturing more than 20% in-place share in atopic dermatitis, as our communication around our level-up study versus Dupixent continues to ramp. Recall that in level-up, we showed strong comparative results on stringent endpoints of skin resolution and itch reduction. In rheumatoid arthritis, Rinvoq is achieving the leading in-place share in the second line plus market, consistent with the brand's label. We see that U.S. physicians are increasingly utilizing only one TNF prior to initiating Rinvoq treatment in RA. In psoriatic arthritis, Skyrizi and Rinvoq together are capturing a leading in-place share in the room category, highlighting the effective co-positioning of both agents in this important segment. Across IBD, Skyrizi and Rinvoq are also capturing substantial portfolio share, given their respective efficacy, safety, and dosing profiles. In Crohn's disease, which is roughly two-thirds of the overall IBD market, these two treatments together are capturing approximately half of the in-place share with total prescription volumes ramping very rapidly. In ulcerative colitis, we are seeing a very strong inflection following the Skyrizi launch in the second-half of last year. Both Skyrizi and Rinvoq together are already capturing roughly a third of the UC in-play market, which supports robust momentum going forward for both AbbVie brands. We see similar performance internationally as well, where Skyrizi and Rinvoq are also achieving leadership positions across our major countries. So, I'm very pleased with this momentum and continue to see a significant opportunity for share gains across our existing indications, in addition to the typical market growth we see across rheumatoid arthritis, dermatology, and gastroenterology in 2025 and beyond. Turning now to Humira, which delivered global sales of more than $1.6 billion, down 48.7% on an operational basis, primarily due to biosimilar competition. We continue to see molecule compression in the U.S. with volume moving to other novel mechanisms, which has resulted in a benefit to both Skyrizi and Rinvoq. We anticipate Humira access will decrease throughout 2025 as more plans move to exclusive biosimilar contracts. It's reasonable to assume that roughly half of U.S. covered lives will continue to have parity access to Humira on a full-year basis, with select exclusionary contracts for existing patients expected to begin around the middle of the year. Moving now to oncology, where total revenues were approximately $1.7 billion. Imbruvica global revenues were $848 million, down 6.2%, reflecting continued competitive dynamics in CLL. Venclexta global sales were $655 million, up 13% on an operational basis, reflecting strong demand for both CLL and AML across our key countries. Lastly, Elahere continues to demonstrate a strong launch trajectory for FR-alpha positive platinum-resistant ovarian cancer, with global sales of $148 million. Sales in the U.S. are annualizing at more than $600 million, and commercialization is now underway in key international markets where we are accelerating regulatory and reimbursement timelines. Moving to neuroscience, where total full-year revenues were $9 billion, reflecting impressive absolute sales growth of nearly $1.3 billion. In the quarter, total revenues were $2.5 billion, up 19.9% on an operational basis. This robust performance is driven by continued double-digit growth of Vraylar with global sales of $924 million, Botox Therapeutic with global revenues of $873 million, Ubrelvy with global sales of $303 million, and Qulipta with global revenues of $201 million. Beyond these leading therapies for psychiatry and migraine, we are very excited for an emerging portfolio in Parkinson's disease. We recently launched Vyalev, the only subcutaneous 24-hour continuous infusion of levodopa-based therapy for the treatment of advanced Parkinson's disease. As a less invasive, non-surgical delivery system that can provide meaningful improvements in on-time and off-time, we are seeing very high interest from both physicians and patient communities. Parkinson's experts report significant benefit from the continuous 24-hour delivery and the control of symptoms morning, day, and through the night. While sales in the U.S. are expected to ramp gradually over the next several quarters as we work to establish the appropriate Medicare coverage and benefit determination, uptake internationally is exceeding our expectations. Finally, I'm very encouraged by the data we are seeing for Tavapadon for potential use as a monotherapy for early Parkinson's disease, as well as an adjunct to optimize oral therapy for more advanced patients. Tavapadon represents a very complementary addition to our Parkinson's disease portfolio with Vyalev and Duopa. So, overall, I'm extremely pleased with the commercial execution across our therapeutic portfolio, which is demonstrating very strong momentum as we head into 2025. With that, I'll turn the call over to Carrie for additional comments on aesthetics.

Thank you, Jeff. Fourth quarter global aesthetic sales were approximately $1.3 billion, reflecting an operational decrease of 4.4%. In the U.S., aesthetic sales of $839 million declined 5% as challenging market conditions and promotional dynamics impacted key assets. Consistent with recent quarters, the U.S. facial injectable market continues to be affected by suppressed consumer spending that is related to the cumulative impact of high inflation over several years. As a higher price procedure relative to toxins, current conditions are most notably impacting the filler market, which declined by approximately 10% in the quarter. The toxin market remains more resilient, demonstrating low single-digit growth. Although we continue to be the clear market leader in toxins and fillers, in Q4, our facial injectable share declined by a few points. In October, we launched an updated version of our Alle consumer loyalty program, which was designed to benefit providers by increasing treatment frequency, patient retention, and cross-selling. While some providers embraced the new loyalty program, many felt the new contract was too complex to integrate into their practices, therefore negatively impacting market share and inventory levels. Based on this market reaction, we reinstated our original Alle consumer loyalty program earlier this month. This action has been met with a rapid and favorable response from our providers, with encouraging early indicators for sales and market share recovery. Internationally, aesthetic sales were $459 million. This represented an operational decline of 3.2%, which was primarily due to lower Juvéderm sales as Botox cosmetic sales were roughly flat on an operational basis. Our international results were impacted by our second largest global market, China, where lower consumer spending related to economic headwinds continues to affect performance. Looking to 2025, we've planned prudently with our outlook for modest aesthetic sales growth. In the U.S., this reflects a gradual improvement in market growth rates and share for both toxins and fillers. Additionally, based on our Alle loyalty program changes, we expect a one-time price adjustment to negatively impact our first-quarter U.S. results. Internationally, we are focused on retaining a strong competitive position as we launch multiple new products in China while we closely monitor market conditions and consumer sentiment. In summary, while economic headwinds and key geographies have created a near-term impact on market conditions, we continue to see significant long-term growth potential, given high consumer interest and low penetration rate. Allergan Aesthetics is uniquely positioned to benefit based on our customer relationships, commercial investments, and innovative pipeline. With that, I'll turn the call over to Roopal.

Thank you, Carrie. We continue to make significant progress with our R&D efforts to advance novel clinical programs across all stages of our diversified pipeline. In 2025, we expect a strong cadence of important data readouts, regulatory submissions, and new approvals, as well as many clinical trial starts for key programs. Starting with immunology, regulatory applications are under review for Rinvoq and GCA, with approval decisions anticipated in the second quarter. Data for two Phase 3 Rinvoq programs will be available this year, including alopecia areata and vitiligo, and for our HS and lupus programs in 2026. Moving to Skyrizi, data from the head-to-head study in psoriasis versus Sotyktu will be available this year. Also this year, to further support differentiation in IBD, a study comparing Skyrizi to Entyvio in ulcerative colitis will be initiated. Additional mid-stage monotherapy and combination studies are planned in 2025, including a Phase 2 study evaluating lutikizumab in atopic dermatitis, a Phase 2 study evaluating Skyrizi and lutikizumab in psoriatic arthritis, and advancement of our anti-TREM1 antibody, ABBV-8736, with the eventual goal to add it to the Crohn's Disease Platform Study as a monotherapy and in combination with Skyrizi. Moving to oncology, where multiple regulatory and clinical milestones, as well as phase transitions for key programs, are planned. One area that we are particularly excited about is our ADC pipeline, where several assets are aimed at multiple tumor types. Our regulatory application is under review for accelerated approval of Teliso-V as a monotherapy in patients with previously treated c-Met overexpressing EGFR wild type non-squamous non-small cell lung cancer. The target for an approval decision is in the first half of this year. This represents a segment of lung cancer with high unmet need, where patients have limited options and tend to have a very poor prognosis. If approved, Teliso-V would be the first c-Met-directed ADC for the treatment of non-small cell lung cancer. We are also rapidly advancing our next-gen c-Met asset. A Phase 3 study evaluating ABBV-400, also known as Temab-A, was recently initiated in patients with c-Met overexpressed refractory metastatic colorectal cancer. Temab-A, as a monotherapy, is being compared against chemotherapy plus bevacizumab. This year, data from a Phase 1 CRC study evaluating Temab-A in combination with bevacizumab could enable a Phase 3 study in an all-comers population. Temab-A is also progressing well across lung programs. A Phase 2 study in EGFR wild-type non-small cell lung cancer is being planned, where Temab-A will be evaluated with a PD-1 inhibitor as a frontline combination therapy. In the EGFR mutant segment, results from the ongoing Phase 1 study could enable Temab-A dose optimization studies as a monotherapy in the second line setting and in combination with osimertinib in the first line setting. In gastroesophageal cancer, a Phase 2 trial was recently started evaluating Temab-A in combination with chemotherapy and a PD-1 inhibitor in frontline patients. We are also excited about ABBV-706, an ADC that utilizes the same Topo warhead and linker technology as Temab-A, but with an antibody that targets SEZ6. Encouraging data in small lung cancer, small cell lung cancer, were presented at ASCO last year. This year, dose optimization and longer-term duration data will be available. This readout could lead to the initiation of a registrational study in the second line and dose optimization in combination with standard of care in the frontline. Moving to FRα ADC, Elahere is now approved for platinum-resistant ovarian cancer in the U.S. and Europe and is currently in Phase 3 development for the platinum-sensitive ovarian cancer segment. Also, a next-generation ADC targeting FRα, IMGN-151, is currently in Phase 1. This year, Elahere will be tested in combination with bevacizumab and a PARP inhibitor. 151 is being advanced into dose optimization as well as in studies with standard of care agents such as bevacizumab, carboplatin, and a PARP inhibitor. These mid-stage studies for Elahere and 151 will be used to inform our Phase 3 approach in various settings for ovarian cancer, including induction and maintenance in platinum-sensitive patients and in combination for frontline maintenance. Another ADC from ImmunoGen known as PIVAC targets a rare hematologic malignancy called Blastic Plasmacytoid Dendritic Cell Neoplasm. Based on positive data from the pivotal Phase 2 study, a regulatory application is planned for later this year. If approved, this would be an important new treatment option for patients with this aggressive blood cancer. Also in the area of hematologic oncology, the Phase 3 Venclexta MDS study is nearing completion with an overall survival data readout later this year. Now moving to neuroscience, following the Emraclidine EMPOWER-1 and 2 study readouts, a thorough analysis of the data was conducted to better understand the placebo effect observed in the two trials. Our findings point to a lack of uniformity of placebo effect across sites. When assessing sites beyond those with high placebo response, a clear efficacy signal was observed, albeit more modest than reported in Phase 1b. Therefore, we see a path forward as an adjunct to atypicals in schizophrenia and as a monotherapy in psychosis related to Alzheimer's and Parkinson's. These are diseases where there is a high unmet need for safe and tolerable treatments that can provide even a modest benefit. Additionally, our intention is to explore higher doses of Emraclidine. This is based on the degree of variability observed in the PK data from the EMPOWER studies. If higher doses are found to be safe and well tolerated, there is a potential opportunity to evaluate Emraclidine as a monotherapy in schizophrenia, as higher doses may result in greater efficacy. A multiple ascending dose study will be conducted this year and data will be available in the early part of 2026. Following this dosing work, Phase 2 studies in adjunctive schizophrenia and potentially monotherapy schizophrenia will be initiated. Dose ranging in elderly patients is ongoing with Phase 2 studies planned in 2026 in patients with psychosis related to Alzheimer's and Parkinson's Disease. Staying on the topic of Parkinson's Disease, positive top-line results from the third Phase 3 trial for Tavapadon were recently announced. In the TEMPO-2 trial, Tavapadon met the primary endpoint, demonstrating a significant reduction in the severity of Parkinson's Disease symptoms compared with placebo at week 26. Key secondary endpoints were also achieved. We are very pleased with the emerging profile for Tavapadon, which shows strong efficacy as a monotherapy and as an add-on to Levo, Carbidopa. The six-month data from the Phase 3 studies show Tavapadon to be generally safe and well-tolerated with low rates of adverse events of special interest, such as sedation and impulse control disorder. Longer-term safety data will be available this year, and regulatory submissions will then follow. Moving to aesthetics, we met with the FDA late last year regarding our BoNT/E submission for the treatment of glabellar lines. We are in the process of generating additional CMC data requested by the agency, which should be completed in the next few months. The regulatory submission will likely occur around the middle of the year. To summarize, there have been significant advancements across all stages of our pipeline. In 2025, we anticipate numerous important regulatory and clinical milestones, including many trial starts for key programs. With that, I'll turn the call over to Scott.

Thank you, Roopal. Starting with our fourth quarter results, we reported adjusted earnings per share of $2.16 which is $0.08 above our guidance midpoint. These results include an unfavorable impact from acquired IPR&D expense. Total net revenues were $15.1 billion reflecting robust growth of 6.1% on an operational basis, excluding a 0.5% unfavorable impact from foreign exchange. Our ex-Humira platform delivered reported growth of 22%, once again exceeding our expectations. Adjusted gross margin was 83.8% of sales, adjusted R&D expense was 15.1% of sales and adjusted SG&A expense was 23.6% of sales. The adjusted operating margin ratio was 34.7% of sales, which includes a 10.4% unfavorable impact from acquired IPR&D expense. Net interest expense was $610 million. The adjusted tax rate was 20.2%. Turning to our financial outlook for 2025, our full-year adjusted earnings per share guidance is between $12.12 and $12.32. Please note that this guidance does not include an estimate for acquired IPR&D expense that may be incurred throughout the year. We expect total net revenues of approximately $59 billion reflecting robust operational growth of 5.7% despite a roughly 4% net unfavorable impact across our portfolio from the Medicare Part D benefit redesign. At current rates, we expect foreign exchange to have a 1% unfavorable impact on full-year sales growth. This revenue forecast contemplates the following approximate assumptions for select key products and therapeutic areas. We expect global immunology sales of $29.4 billion, including Skyrizi revenue of $15.9 billion reflecting growth of more than $4.1 billion driven by continued strong performance in psoriasis as well as robust uptake in IBD; Rinvoq sales of $7.9 billion reflecting growth of nearly $2 billion with continued market growth and share momentum across all approved indications. And Humira total revenue of $5.6 billion, including U.S. sales of $4 billion as more plans exclude branded Humira around the middle of the year. This forecast includes a $600 million net unfavorable impact from the Medicare Part D benefit redesign. In oncology, we expect global sales of $6.3 billion including IMBRUVICA revenue of $2.7 billion which reflects a $400 million net unfavorable impact from the Medicare Part D benefit redesign; Venclexta sales of $2.6 billion, reflecting continued strong demand, partially offset by a $100 million net unfavorable impact from the Medicare Part D benefit redesign and Elahere revenue of $750 million. For Aesthetics, we expect global sales of $5.3 billion reflecting gradual improvement in market conditions across global markets as well as market share recovery in the U.S. This includes Botox Cosmetic revenue of $2.8 billion and relatively flat sales for Juvéderm. For neuroscience, we expect global sales of $10 billion reflecting continued double-digit growth. This includes Vraylar revenue of $3.5 billion reflecting continued strong prescription demand, partially offset by a $200 million net unfavorable impact from the Medicare Part D benefit redesign; Botox Therapeutics sales of $3.5 billion, total oral CGRP revenue of $2.1 billion and Vraylar sales of $300 million. For eye care, we expect global sales of $2.2 billion. Moving to the P&L for 2025, we are forecasting full-year adjusted gross margin of approximately 84% of sales, adjusted R&D investment of approximately 14.5%, adjusted SG&A expense of approximately $13.2 billion and an adjusted operating margin ratio of roughly 47% of sales. We expect adjusted net interest expense of approximately $2.6 billion which primarily reflects the annualized financing cost for the ImmunoGen and Cerevel transactions. We forecast our non-GAAP tax rate to be approximately 15.6%. Finally, we expect our share count to be roughly flat to 2024. Turning to the first quarter, we anticipate net revenues of approximately $12.8 billion. At current rates, we expect foreign exchange to have a 1.6% unfavorable impact on sales growth. This revenue forecast comprehends the following approximate assumptions for our key therapeutic areas. Immunology sales of $6.1 billion including Skyrizi sales of $3.2 billion and Rinvoq revenue of $1.6 billion, we expect U.S. Humira sales of $900 million. We also anticipate oncology revenue of $1.5 billion, aesthetic sales of $1.1 billion which includes an unfavorable one-time price adjustment due to the reimplementation of the original program, neuroscience revenue of $2.1 billion and eye care sales of $550 million. We are forecasting an operating margin ratio of roughly 44.5% of sales and model a non-GAAP tax rate of approximately 13.8%. We expect adjusted earnings per share between $2.47 and $2.51. This guidance does not include acquired IPR&D expense that may be incurred in the quarter. Finally, AbbVie's robust business performance continues to support our capital allocation priorities. Our cash balance at the end of December was approximately $5.5 billion and we expect to generate free cash flow approaching $17 billion in 2025, which includes roughly $2.7 billion of Skyrizi royalty payments. This free cash flow will support a strong and growing quarterly dividend, which we have increased by 310% since inception, as well as debt repayment, where we expect to pay down nearly $3 billion of total debt this year and remain on track to achieve a net leverage ratio of 2x by the end of 2026. Our strong cash flow also provides capacity for continued business development to further augment our portfolio. In closing, we are pleased with AbbVie's results in 2024 and our financial outlook remains very strong. We have considerable momentum across our diverse portfolio, and we continue to be well-positioned to deliver robust growth in 2025 and beyond. With that, I'll turn the call back over to Liz.

Thanks, Scott. We will now open the call for questions. In the interest of hearing from as many analysts as possible over the remainder of the call, we ask you please limit your questions to one or two. Operator, first question please.

Our first question comes from Vamil Divan with Guggenheim Securities. Your line is open.

Great. Thanks for taking the question. So, maybe just to dive a little deeper on the Skyrizi, it is a great performance and guidance. Can you just comment a little more on pricing dynamics that you're seeing there as to how you've factored in pricing both for this year and maybe over the next several years? And then, just a quick follow-up on the comments that were given around aesthetics, especially on the share side, I think you lost a few points when maybe getting it back. Can you just give a sense of where you think the share is now for Botox and Juvéderm sort of this point in time? Thank you.

Yes, thanks, Vamil. It's Jeff. And I'll comment on Skyrizi and Rinvoq. And I think we've been very consistent that over the near term and over time, this is a volume-based business, so we're going to see price declines year-over-year. But I would say modest, right? We've sort of highlighted that as we negotiate the formularies, we've started to consistently see sort of these low single-digit price concessions. Now, obviously, what Scott highlighted was unique for the 2025 year with the Part D redesign that he outlined. Overall, consistent low single-digit price declines from the rebating side with a one-time Part D. We would anticipate once we left the Part D, we would see that sort of trend going forward.

And Vamil, this is Rob. I'll just add that if you think about Skyrizi and Rinvoq, our strategy here was to elevate the standard of care for patients, which ultimately would drive a rapid return to growth for the company beyond Humira. And that's exactly what we've been able to execute. That strategy has played out. You see the differentiation in the marketplace. We have nine head-to-head studies. We're launching a few more. We've upgraded our guidance now by an additional $4 billion in 2027. We've been very consistent in our language around the pricing dynamics. We said when you think about rebates, think about it as negative low single-digits going forward, but given the robust performance of these assets, it's volume that's dominating the growth, and we would expect that to continue.

And hi, this is Carrie. I'll answer your question around Botox and Juvéderm share. So, in the U.S., we remain the clear market leader for both toxins and fillers. In Q4, we experienced a few points of share erosion, bringing Botox to around the low to mid-60s, Juvéderm to around the low to mid-40s. The reversion of the loyalty program back to the original one, which we announced in December, and then put into action January 21st, was greeted with a very positive response from our customers. Encouraging signs for us to recapture that share for both Botox and Juvéderm throughout the year. And just to note that the share did not go to one competitor. Rather, it was more distributed amongst the entire competitive set.

Thanks, Vamil. Operator, next question please.

Yes. Our next question comes from Chris Schott with J.P. Morgan. Your line is open.

Great. Thanks so much. Just a two-parter on the Skyrizi Rinvoq dynamics, maybe just first on the 2027 guidance, can you just elaborate on what were the biggest drivers of upside to those targets, as you think about the various indications for the drugs? I guess, is it fair to think most of this coming from IBD, or is it across the board? And then, probably a longer-term question on those brands, can you just elaborate a little bit more on how we should think about the growth rate beyond 2027? So basically, how mature will these franchises be by then? And what type of growth rates can we think about over time? Thank you.

Yes, thanks, Chris. This is Jeff. I'll start on that. The main factor behind the change is share capture. Our pricing assumptions have remained steady, and we have a good understanding of the markets. We are observing both actual performance and long-term trends. The significant driver has been share capture, which we see across the board. We are particularly encouraged by Skyrizi's performance in psoriasis, where we continue to observe strong TRx share trends. Additionally, the ramps in IBD have been substantial, which is a major component as well. Overall, it's predominantly about share capture. Scott, do you have anything to add? That's the key dynamic regarding the $4 billion.

Yes, Jeff. Maybe, Chris, if it would help, I can give you the breakdown by indication between the two on the 2027 guidance. So, we talk about $31 billion combined in 2027. That's our new long-term guidance. That is $11 billion for Rinvoq and $20 billion for Skyrizi. Rinvoq is broken down. Rheumatology is about $4.8 billion; dermatology, $2.5 billion; IBD, $3.7 billion. And then, on the Skyrizi side, $12.5 billion of that $20 billion guidance is from psoriatic indications. The remaining $7.5 billion is coming from IBD. So, that might help you kind of see those where the growth is coming from as well.

And if we speak to it in terms of the $4 billion to add to what Scott mentioned. Skyrizi is up $3 billion. A billion of that is psoriatic and $2 billion is IBD. We're just seeing tremendous ramps early days with IBD. For Rinvoq, it's up a billion from the previous guidance, and that’s a mix of roughly $300 million rheumatology, $200 million dermatology, and $500 million IBD. So, again, across the board, we're seeing tremendous performance, particularly in IBD. And then, your question on how to think about the growth, we have obviously given guidance beyond 2027. But as I look at the sell-side consensus, clearly the growth that's in sell-side consensus beyond '27 is below our expectations. We would expect to see these markets continue to grow. We would also expect to see continued share gains, albeit as you start getting close to that in-place share level, the share curve bends, but you still expect to see some level of share growth. And then, keep in mind, we will have the five indications for Rinvoq, collectively adding about $2 billion in peak sales and so that will also contribute. So, as I think about the rate of growth for Skyrizi and Rinvoq beyond '27, Rinvoq will likely grow faster than Skyrizi because of those new indications, but you'll still see a robust performance from both assets, at least through '32.

Thanks, Chris. Operator, next question please.

Our next question comes from Geoff Meacham with Citigroup. Your line is open.

Hey, guys. Good morning. Thanks so much for the question. Just had a couple, first one on Cerevel, you guys called out the partial impairment today in the press release. Just want to get your perspective as to what the drivers are for the remaining value, assuming Tavapadon is mostly it, but wasn't sure what you'd assume for Emraclidine or backup compounds? And then, just on aesthetics, with the new guidance to 2029, is it fair to say that you think '25 could be the trough or have already seen a trough in terms of the growth rate? I'm just trying to think of the longer-term picture. And then, just on BoNT/E, I wanted to get your perspective about the potential success there adding new patients to the paradigm, just given the potential there. Thank you.

Geoff, on your first question regarding Cerevel, so keep in mind, the accounting rules do not allow you to write up an intangible. So, even though we are more optimistic about Tavapadon now than we were at the time of the deal, we can't write that value up. So, that would be the same as what we originally ascribed. We still obviously, as Roopal walked you through the development programs for Emraclidine, still see opportunity in adjunctive schizophrenia as well as neurodegenerative psychosis. We haven't completely given up on the monotherapy opportunity either, but that's a more heavily risk-adjusted opportunity now. So, when you think about the value, you have to take into account the timing, so there's some level of time delay as well as a different probability of success for monotherapy. That's all baked into because you're essentially valuing risk-adjusted revenues. You have to take that into account. That said, we're still optimistic about the asset. We're pursuing it in these indications. And again, as I mentioned, we haven't completely given up on monotherapy; that will depend on dose ranging. But that is the way we constructed the revaluation of the intangible. Overall, we still see a very nice opportunity, particularly for Tavapadon, and we still see potential for Emraclidine as well.

Geoff, I'll take your question regarding the aesthetics trough. So, we've not specifically guided that, but the way that we have modeled it and think about it is we do see recovery. The big headwind here has been over the last two years, stemming from the economic condition. We do see continued improvement. Carrie spoke about some of the market growth rates that we're seeing coming back in the U.S. for both fillers and toxins. We would anticipate '25 to be the trough. Our long-term guidance is for a high single-digit CAGR using '25 as the base year through '29. If you model that, that’s going to put you somewhere north of $7 billion. Certainly, this is a business we continue to be excited about. We think that there are continuing to be low market penetration rates globally, and we've got some innovation to continue to drive market growth. The market has grown low double-digits historically, but I think as we model, we're thinking a high single-digit growth in the markets. We do see some growth accelerators with BoNT/E, and maybe I'll let the team talk about BoNT/E.

Maybe I'll just mention here just more broadly, this is Rob, on the business. I think as we reflect on the aesthetics performance, we are just going through a period of macroeconomic pressure on that business. But we do continue to see an attractive long-term setup given low penetration rates, high consumer interest, and our leading portfolio, including some exciting pipeline programs in toxins and fillers. As part of AbbVie, the aesthetics business has been able to continue investing despite the macroeconomic challenges, and that will allow us to maximize opportunities when the market does recover. We have set up this business to be a global fully integrated unit with dedicated support from R&D and business development, and I'm confident that focused approach will pay off in the long run. It's just been difficult for us to call the market recovery, but we still have a lot of confidence in the long-term outlook.

And this is Carrie. I'll comment on BoNT/E. So, as you said, BoNT/E will be an important catalyst for new patient activation into the category. Consideration continues to be very high for aesthetics and for toxins. It continues to be underpenetrated. There continue to be barriers for these people who are interested in the category but are not acting around cost and concerns of an unnatural look. That’s where BoNT/E will play an important role based on its unique profile that is suited to address these concerns. It's fast-acting and has a short duration, which makes it a nice option to position for these considerers to try BoNT/E. Our commercial strategy will be to convert them from BoNT/E to Botox. This will be an important pipeline catalyst to help us activate that consumer market and drive more consumers into the toxin category for Botox.

And it's Roopal. Maybe one comment to add to Carrie's. On the R&D side, thinking past that, this year we'll initiate a study with BoNT/E plus Botox to cover people immediately and get that long-term benefit. Those studies will start this year.

Thanks, Geoff. Operator, next question please.

Yes, our next question comes from Terence Flynn with Morgan Stanley. Your line is open.

Hi. Thanks for taking the questions. You mentioned the net impact of the Part D redesign. Can you tell us what the volume impacts you guys are assuming, if any, in that calculation? And then the second question I had is, on the pipeline slide, you noted you could have some Phase 2 UC data for 113, which I believe is your oral NLRX1 agonist. Just maybe speak to conviction level there and how you think about that on the forward and if that would be something that you could move into Phase 3. Thank you.

Terence and Scott, I'll take your question on the volume. So, we have guided a 4% net impact across the business for headwind to growth for Part D redesign. Now, when we think about that volume offset, we've not quantified that in the guidance, but that is part of the 4%. I would say, in the grand scheme, it's a fairly modest offset overall. Part of what you need to do when you think about that volume is recognize that there are roughly three patient segments, and they each take about a third of the business. This is something that will impact the standard eligible, and we're working very hard to ensure that people are electing cap and smooth. We really see that volume offset coming from that one-third of the patient segment to drive that. So, that's why I think it's a little bit more of a modest offset, but we've not quantified it.

And it's logical when you think about it because the other two-thirds are the LIS population, which is one-third, so they don't have the out-of-pocket burden like the standard eligible do. The other third are covered by employer plans, where again, they don't have the same out-of-pocket burden. When we analyzed it, we looked at the market and saw that about a third, as Scott mentioned, of the population would benefit from the lower out-of-pocket. The cost share applies to the entire book of Medicare business. That's why the volume doesn't offset the price impact.

And this is Roopal. I'll cover the NLRX question. This is our asset from Landos. We had observed very early data, I would say Phase 1b, in ulcerative colitis, and that looked good, but it was a very small sample size. So, this will be a robust Phase 2 with a placebo comparator, and we'll get objective data from centralized review of endoscopic data. It will be a good data set to look at, and if it looks good, definitely would be a Phase 3 asset for us. The other consideration we would have is similar to what I highlighted about other biologics that we'd be combining with Skyrizi. If this looks good, this could be a combination agent with Rinvoq as well.

Thanks, Terence. Operator, next question please.

Yes, our next question comes from Mohit Bansal with Wells Fargo. Your line is open.

Great. Thank you very much for taking my question, and congrats on all the progress. I have a question regarding IMI. So, I know you talked in the past about Skyrizi and Rinvoq benefiting from some of the Humira prescriptions going to these agents as well. Taking that aside, it still seems like the volume or IRA space is growing rapidly. Can you talk a little bit about the underlying dynamics as well here, why this market continues to grow, and how should we think about longer term for the overall market growth itself? Thank you.

Yes. So, thanks, Mohit. It's Jeff. Like we talked about before, particularly around the acute event, in this case, this was the CDF exclusion in April, we could clearly start to measure the fact that not all of the switching from Humira was going to the biosimilar. We saw about 20% of it was slipping away into new mechanisms or more advanced mechanisms like Skyrizi and Rinvoq. We continue to see the molecule compress. It’s becoming harder to measure because you're also seeing a lot of dynamics around new head-to-head trials, new indications, and other approaches. Overall, it's there, but it's relatively modest in the scheme of the volume that is basically accruing from the promotion and the profile of the medication. So, it should continue. As we see sort of disruption in the market, you'll probably continue to see the molecule on trend continue to compress. Now albeit modest, your other point is very important. These markets are still very, very buoyant and significant.

Now, as we examine the specialty areas, in psoriasis and IBD we are expecting high single-digit market growth. For atopic dermatitis, we anticipate mid-teens growth because penetration rates are still relatively low, indicating substantial potential for growth. For rheumatoid arthritis, we expect low to mid-single digit growth. Overall, we are observing strong market growth across the board, which will be further enhanced by market share gains.

Thanks, Mohit. Operator, next question please.

Yes. The next question comes from Dave Risinger with Leerink Partners. Your line is open.

Yes. Thanks very much. I have two questions, please. First, regarding ABBV-400 or Temab-A, could you please frame your long-term commercial vision for this candidate, including what some may underappreciate about how broadly it could potentially be adopted in the early 2030s? And then, second, on external transactions, emraclidine was a setback, but AbbVie's overall M&A track record has been very successful. Could you please discuss your agenda for M&A, including the potential to leverage your franchise strength in related product categories? Thanks so much.

Yes. Hi. It's Jeff. I’ll give some thoughts on that. It's a very, very attractive asset; I think it's underappreciated. Part of it is the first category it will compete in, which is colorectal cancer. If you look at the response rate that we've seen in a smaller or mid-size cancer type, which is ovarian cancer with Elahere, it's quite striking. Elahere has been the most rapidly adopted ADC in the entire U.S. oncology market. It entered this market that was basically almost all chemo-based with unmet need where there had been no innovation. When we look at the entry with 400 or Temab-A into colorectal cancer, it's a substantially larger tumor type. We've already seen very, very nice monotherapy results in later lines, much better than we've seen with the old chemo standard of care. The thing that will really cause a big inflection is the combinability as we go up into the lines of therapies, and that’s going to make this thing inflect and become a very significant product for patients in colorectal cancer over time. The studies will have to bear that out. We’re also seeing very significant early results in lung cancer as well. It is an underappreciated asset. We'll have a chance with Teliso-V to sort of set the market around this whole c-Met area, and that’s quite striking. We establish in later lines, and then we move combinations as we move forward. So, thanks for the question.

Hey, it's Roopal. Maybe just a comment there on our strategy around ADCs. We think about what's a good target, meaning high expression on the tumor and low expression in healthy tissue. We're continuing to focus on patient selection and individualization of care, utilizing robust biomarkers. Our approach is to optimize benefit-risk and particularly tolerability.

And then, David, this is Rob. I'll take your question on M&A. Thank you for acknowledging the strong track record we've had as a company. I would agree with that when you think about the transaction with BI that brought us Skyrizi, with Pharmacyclics that brought us Imbruvica, really gave us critical mass to be a leader in blood cancers, and then the transaction with Allergan, which gave us three verticals that can really drive long-term growth for the company in neuroscience, aesthetics, and eye care. More recently, the transaction with Immunogen has bolstered our ADC pipeline. In terms of our go-forward strategy on BD, we continue to pursue assets that can add depth to our pipeline and really drive growth in the next decade. When we started 2024, we signed more than 20 early-stage deals across immunology, oncology, and neuroscience. We have a clear line of sight to growth for at least the next eight years within the company today. My focus is to bring in assets that can help drive that growth in the next decade. In immunology, we’ve added novel mechanisms that have the potential to raise standard care. You should expect that strategy to continue. In oncology, we’ve added new platforms, including multispecifics, trispecifics, T-cell engagers, and in situ CAR-T approaches. Our BD efforts are focused on building pipeline depth; we also have the financial capacity to pursue those opportunities as well.

Thanks, Dave. Operator, next question please.

Yes, our next question comes from Steve Scala with TD Cowen. Your line is open.

Thank you so much. I have an observation and two questions. The observation is splitting hairs, but on Part D redesign, the guidance had been a three percentage point headwind. It was just set on the call four percentage points. A year ago, it was two percentage points. If there’s a change, please, can you identify that? Related to that is my first question. Are you seeing any evidence that IRA Medicare pricing is spilling over to the commercial market? If yes, to what degree, or is there absolutely none? And then, my second question, the company has provided a lot of helpful perspective on the aesthetics market, but can you distill it to a number? The guidance for aesthetics was previously greater than $9 billion in 2030. What is that number now? Thank you.

Steve, this is Scott. I'll go ahead and start with your Part D observation and question. We really saw that in the past. The stocking was relatively minimal. We did not see anything with respect to Skyrizi and Rinvoq on the stocking in the fourth quarter that’ll be impacted in the first quarter.

And Steve, I’ll just add, when you think of the setup for the company in '25, we said we would return to robust growth, and we're delivering in absolute terms in our guidance a little bit more than $2.5 billion of growth, and that's with headwinds from U.S. Humira erosion around $3 billion, the Part D benefit redesign of approximately $2 billion when you do the math on the roughly 4%, and a $500 million headwind from the stronger U.S. dollar.

So to answer your question regarding the aesthetics guidance, when we look at that long-term guidance, that long-term guidance is calling for a high single-digit CAGR '25 through '29, so using '25 as the base year. If you do the math on that range, that’s going to put you above $7 billion, depending on where it falls within that high single-digit range. The market growth we’ve seen historically has been low double-digits. But we’re seeing that market we’re modeling for now, high single-digit growth during the time period that we’ve given this long-term guidance. That answers your question.

Thanks, Steve. Operator, next question please.

The next question comes from Tim Anderson with Bank of America. Your line is open.

Thank you. A couple of questions, please. On aesthetics, a question I've asked before: what are your expectations for how obesity drugs are going to impact this business? You could argue that the surge in use of products, the GLP-1s, could either be a tailwind or a headwind to the use of products like toxins and fillers. It could be a headwind if patients have to pick and choose between which products to put their out-of-pocket dollars towards. And then, a second question unrelated to the first. PBM reform still being debated in Washington. If AbbVie had its way, what would change about the current relationship between PBMs and drug companies, and what would you argue should be left alone?

Hi, this is Carrie. I'll answer your first question around the obesity market and the aesthetics opportunity. It continues to be both a headwind and a tailwind. A headwind in terms of share of wallet as these consumers make decisions on what they're going to spend for. We see that more for the higher-priced products like fillers. And then, also a tailwind as this gets a new group of consumers or patients interested in aesthetics, and many of our aesthetic providers are administering these products, seeing this as an opportunity for lead generation and bringing new patients into the category. We do see it as both a tailwind, a headwind in the short term, but a tailwind in the long term. The question is not if injectables work. We know these products work well in these patients. It's really about how we can partner with our customers to build it and integrate it into their treatment practice.

And Tim, this is Rob. I’ll take your question on PBM reform. Look, if there are changes to the rebate system, we don't have a strong preference between rebates or discounts. That's because we've always competed on the attributes of our products, both the clinical benefit they provide and the value they return to health systems. We’re confident in our ability to compete in either world. I would just point to our share performance in international markets that do not have a rebate-based system. We see similar market shares in those countries as well. We can compete effectively in either system.

Thanks, Tim. Operator, next question please.

Our next question comes from Chris Raymond with Piper Sandler. Your line is open.

Yes, thanks. Just a question on atopic dermatitis as a target indication. Just from some of our work, it looks like the upside we're seeing in Rinvoq is largely in rheumatology and gastroenterology. I know you guys have mentioned this, and it’s fairly well known. In atopic dermatitis, at least from our data, it looks like things are starting to flatten out a little bit. I heard your comments on the derm share of Rinvoq revenue in 2027. But that would seem to infer some kind of inflection. So, maybe a two-part question here; first, talk about the current growth dynamic in atopic dermatitis, and is there an inflection anticipated? And the second part of that is, should we be paying more attention to lutikizumab as a contributor here? I know, Jeff, you've talked about atopic dermatitis as a very important indication that you guys are targeting. Or is there some other area, like external innovation, that you think will augment your position in this indication? Thanks.

Yes, it’s a very good question. It's an important segment. To give you some sense of the inflection we see in terms of new patient capture. Despite the launch of other interleukin products over the last year, we've ramped to the highest in-place shares that we've had. It was largely flat in the teens for many quarters, and it’s ramping up now above 20%. A lot of that is we've been able to distinguish Rinvoq on these stringent endpoints where you're taking itch down to a very low level and almost completely clearing the skin. We see that in-place shares start to build into the TRXs over time. In many, if not most, of the outside U.S. markets, our shares are much higher and building even a little bit faster. We’re enthusiastic about Rinvoq. It’s the best agent for getting to complete control. We’ll continue to invest in the space, and we will look for more assets. Some are in our pipeline as described.

That's right. With the 5% penetration rate, many patients are still untreated. Lutikizumab will be our next one. Jeff mentioned there’s other pipeline assets that we're working on. Key is skin clearance along with that itch, which will keep us competitive.

Thanks, Chris. Thank you, Operator. That concludes today's conference call. If you'd like to listen to a replay of the call, please visit our website at investors.abbvie.com. Thanks again for joining us.

Thank you. That concludes today's conference. You may all disconnect at this time.