Thank you, Paul, and good morning, everyone. Thank you for joining us for Eli Lilly and Company's Q1 2024 Earnings Call. I'm Joe Fletcher, Senior Vice President of Investor Relations. And joining me on today's call are Dave Ricks, Lilly's Chair and CEO; Anat Ashkenazi, Chief Financial Officer; Dr. Dan Skovronsky, Chief Scientific Officer and President of Lilly Immunology; Anne White, President of Lilly Neuroscience; Ilya Yuffa, President of Lilly International; Jake Van Naarden, President of Loxo at Lilly; and Patrik Jonsson, President of Lilly Diabetes and Obesity and Lilly U.S.A. We're also joined by Michaela Irons, Mike Springnether and Lauren Zierki of the IR team. During this conference call, we anticipate making projections and forward-looking statements based on our current expectations. Actual results could differ materially due to several factors, including those listed on Slide 2. Additional information concerning factors that could cause actual results to differ materially is contained in our latest Form 10-K and subsequent filings with the SEC. The information we provide about our products and pipeline is for the benefit of the investment community. It's not intended to be promotional and is not sufficient for prescribing decisions. As we transition to our prepared remarks, please note, our commentary will focus on our non-GAAP financial measures.

Okay. Thanks, Joe. We're pleased with our Q1 results and the continued momentum in our business, which positions us well for accelerated growth as this year progresses. Our focus is to bring innovative medicines to people in need. And in 2024, we're investing in our people, our launches, expanding our pipeline of new medicines, including through business development, and of course, accelerating the needed capacity in our manufacturing network. Results this quarter represent a continuation of the strong growth we delivered in 2023. On Slide 4, you can see details of the financial performance and progress related to our strategic deliverables. Revenue grew 26% in Q1 with our new products growing nearly $1.8 billion compared with the same period last year. We achieved several key pipeline milestones, including the positive Phase III results for tirzepatide in moderate to severe obstructive sleep apnea, the approval of our multi-dose KwikPen delivery device for Mounjaro in Europe, submission of mirikizumab in the U.S. and the EU for moderately to severely active Crohn's disease, the resubmission of lebrikizumab in the U.S. for moderate to severe atopic dermatitis and the initiation of our Phase III study for lepodisiran, evaluating efficacy and reducing cardiovascular risk. Lilly's top priority is to ensure we execute on our ambitious manufacturing expansion agenda. We recently signed an agreement to acquire an injectable medicine facility from Nexus Pharmaceuticals in Pleasant Prairie, Wisconsin. This state-of-the-art facility has been FDA approved, and we are targeting to initiate production at the end of 2025. We broke ground earlier this month on our previously announced parenteral manufacturing site in Germany. And in existing facilities, we are working to maximize output and productivity to meet demand. The recent EMA approval and upcoming launch of our multi-dose KwikPen delivery life for Mounjaro will unlock new supply capacity for Europe and other international markets. While we are also seeing meaningful progress in the ramp of new lines in existing Lilly and CDMO sites for the United States. We continue to make progress against our plans to increase manufacturing capacity, the most ambitious expansion plan in our company's history. Lastly, we distributed over $1 billion in dividends during the first quarter.

Thanks, Dave. Slide 6 summarizes financial performance in the first quarter of 2024. First quarter revenue growth of 26% was driven by new products, primarily Mounjaro and Zepbound. Gross margin as a percent of revenue increased from 78.4% in Q1 2023 to 82.5% in Q1 2024. Gross margin in the quarter benefited from higher realized prices, variable product mix and, to a lesser extent, improved production costs. Marketing, selling and administrative expenses increased 12% primarily driven by promotional efforts supporting current and future launches as well as increased compensation and benefit costs. R&D expenses increased 27%, driven by higher development expenses for late-stage assets and additional investments in early-stage research as well as a one-time charge of approximately $75 million associated with the termination of the Verzenio prostate program. In Q1, we recognized an acquired IPR&D charge of $111 million, which negatively impacted EPS by $0.10. Operating income increased 63% in Q1 driven by higher revenue from new products, partially offset by operating expense growth. Our Q1 effective tax rate was 11.9% compared to 12.8% in Q1 2023 driven by a larger net discrete tax benefit reflected in Q1 2024 compared with the same period in 2023. We delivered earnings per share of $2.58 in Q1, a 59% increase compared to Q1 2023, inclusive of the negative impact of $0.10 from acquired IPR&D charges in both periods.

Thanks, Anat. Let me start with our exciting announcement from earlier this month. That was the positive Phase III results from the SURMOUNT-OSA studies, which evaluated tirzepatide for the treatment of adults with obesity and moderate to severe obstructive sleep apnea known as OSA. OSA is a sleep-related breathing disorder characterized by complete or partial collapse of the upper airway during sleep. OSA can have serious cardiometabolic complications contributing to hypertension, coronary heart disease, stroke, heart failure, atrial fibrillation and even type 2 diabetes. The need is significant. OSA impacts 80 million people in the U.S. with more than 20 million people suffering from moderate to severe OSA. We also know that a substantial majority, approximately 70% of people with OSA also live with obesity. While there are pharmaceutical treatments for the excessive daytime sleepiness associated with OSA, tirzepatide could potentially be the first pharmacological treatment for the underlying disease. As shown on Slide 12, SURMOUNT-OSA was comprised of two separate trials run under one master protocol. Study 1 evaluated tirzepatide in participants not currently on positive airway pressure or PAP therapy, while Study 2 evaluates tirzepatide in patients who had used PAP for at least three months prior to the study and planned to continue PAP therapy during the entire course of the trial. A total of 469 participants were enrolled across these studies. Each study randomized participants to either maximum tolerated dose approved for tirzepatide, which can be 10 milligrams or 15 milligrams, or to placebo. And patients were followed on therapy for 52 weeks. For the efficacy estimate on the mean Apnea-Hypopnea Index, or AHI, tirzepatide led to a mean reduction of 27.4 events per hour compared to a mean AHI reduction of 4.8 events per hour for placebo. This difference was highly statistically significant. AHI baseline values were 52.9 and AHI was reduced by 55% in the tirzepatide arm. We also saw a mean body weight reduction of 18.1% for tirzepatide treatment consistent with our expectations for the study. This was, of course, also statistically significant versus placebo. In both studies, the overall safety profile was similar to previously reported SURMOUNT and SURPASS trials. The most commonly reported adverse events were gastrointestinal-related and generally mild to moderate in severity, with the most commonly reported gastrointestinal adverse events for patients treated with tirzepatide being diarrhea, nausea, vomiting and constipation.

Thanks, Dan. We'd like to take questions from as many callers as possible and to conclude our call in a timely manner. Operator, please provide instructions for the Q&A session, and we're ready for our first caller.

Congrats on the progress here. I just had a question, just was hoping you could elaborate a bit more on the capacity dynamics that are leading to the guidance raise today. Specifically just looking for little more color, is this more U.S. or international? And should we read this as more capacity in the system than you expected or just a faster ramp of the new plant and maybe the same overall capacity as you exit the year?

Thanks for the question, Chris. And as we've mentioned earlier in the year when we issued guidance, we said that we expect capacity and supply to ramp towards the second half of the year, and that's what we're seeing. Now as a reminder, we do have quite a large number of nodes across our supply chain that have to come online or ramp capacity. We have six sites right now between the two sites in North Carolina, a site in Ireland, two sites in Indiana, a site in Germany and then a seventh one that we just purchased, they are all either ramping up or under construction. And there are multiple nodes across that supply chain that have to become operational, which requires approval, et cetera, for three products, depending on which product runs on which line, that are planned throughout the year. Now that we're four months into the year, we have greater visibility into that — into these nodes of capacity and feel more confident. Just as one example, the approval of the KwikPen in Europe that just came in slightly ahead of our expectation gives us additional confidence in our ability to launch KwikPen for patients in Europe. So it is across our sites globally as well as ramping up capacity with partners or CDMOs as well as in existing sites where we're making investments to expand where we can or ramp up capacity. So it's across our supply chain.

I have a question regarding the pricing. So if you look at the script trend, it seems like there was a little bit of adverse relationship in the pricing versus fourth quarter. Can you comment on that? And how should we think about the cadence of price volume over the quarters for the year?

Thank you very much, Mohit. When you look at the pricing of Mounjaro, I think it's important to take into account that in the Q4 earnings, we announced a one-time adjustment for Mounjaro in Q4 that was quite significant. So it was a one-time adjustment in the base of Q4. When we look forward for the first half of 2024, it's important to have in mind that we also terminated the $25 saving card 6/30/2023, but patients that were on are grandfathered until 6/30/2024. So there would probably be some benefits during the first half of 2024 for Mounjaro. But from the second half of this year, we should expect to see typical pricing headwinds for Mounjaro as well.

I wanted to focus a quick second on Part D reimbursement dynamics, if I may. And my question is, will tirzepatide be considered differently than a 'weight loss drug' to secure Part D reimbursement? And the new indications like sleep apnea, will they consider an applicable drug and not get lumped up as a broad 'weight loss drug'?

Thank you very much, Umer. I think with the announcement made by the CMS early April to reimburse comorbidities for obesity based upon the SELECT trial, we're also confident that with the new data that we presented just weeks ago in terms of obstructive sleep apnea, that's going to be reimbursed in Medicare Part D. And we expect similarly for other comorbidities and the readout of HFpEF, assuming that's positive and approved, and later on with the mobility-mortality outcome study. Still, our true north is really to get the true Treat and Reduce Obesity Act cost, and we strongly believe it's not a matter of if but when. We don't see it likely to pass in 2024, but there is still a small likelihood that that's going to happen.

Great. So really just wanted to ask, Dan, as you have assessed the Phase II SURMOUNT data in NASH, just interested to know how you are thinking about those data and the opportunity for tirzepatide in that setting or perhaps if retatrutide remains the right target molecule to move forward there? We've had a lot of speculation around some of the comments from the last quarter and just trying to firm that up and also when we're likely to see those data, I believe they're expected at EASL, but if that is possible to confirm.

Thanks, Seamus. So I'll start with the last part there. Yes, the abstract was accepted and will be presented at EASL early June. So that will be the opportunity to see the full NASH package from that Phase II trial. Like we said in the last call, really exciting data. We shared some of the top line. I think tirzepatide can have a profound effect on this disease. It's a Phase II trial. Next steps here are to discuss with the FDA what the best path forward could be for tirzepatide.

Thanks, Dan. I think we've got time for maybe one more question. We're right at 11. So maybe a final question in the queue.

I just wanted to try and reconcile the guidance lift with the 1.5x saleable doses being maintained.

So let's start with the 1.5 dose — saleable dose comment that I made on the guidance call in February. So that reference is not a number of devices, but the number of saleable doses. And as we ramp up capacity for KwikPen, recall that unlike the single-use vial or the auto-injector, the KwikPen is a multidose device that has multiple doses available for patients. That comment referred to the second half of this year versus the second half of last year. So we're expecting that total saleable doses this year in the second half will be at least 1.5x where we were second half of last year. That remains unchanged. But the level of confidence we have in our ability to progress on each node of our capacity that's coming online or will get approved, et cetera, has just increased.

Thanks, Anat. Great. Well, thanks for your time today, everyone, and we appreciate you participating in today's earnings call and your interest in our company. Please follow up with the IR team if you have any additional questions that we didn't address today, and have a great day. Thanks.