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Novartis (NYSE:NVS)
Q1 2021 Earnings Call
Apr 27, 2021, 8:00 a.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:


Operator

Good morning and good afternoon, and welcome to the Novartis Q1 2021 results release conference call and live audio webcast. Please note that during the presentation, all participants will be on a listen-only mode and the conference is being recorded. [Operator instructions] A recording of the conference call including the Q&A session will be available on our website shortly after the call ends. [Operator instructions] With that, I would like to hand it over to Mr.

Samir Shah, global head of investor relations. Please go ahead, sir.

Samir Shah -- Global Head of Investor Relations

Thank you very much, and good morning and good afternoon, everybody. Thank you for taking the time to join us on the Q1 results conference call. We appreciate that you're taking your time. Before we start, I just want to go through the safe harbor statement.

The information presented today contains forward-looking statements that involve known and unknown risks, uncertainties, and other factors. These may cause actual results to be materially different from any future results, performance, or achievements expressed or implied by such statements. For a description of some of these factors, please refer to the company's Form 20-F and its most recent quarterly results on Form 6-K that respectively were filed with and furnished to the U.S. Securities and Exchange Commission.

And with that, I'll now hand it across to Vas.

Vas Narasimhan -- Chief Executive Officer

Thank you, Samir. And thanks again to everyone for joining today's conference call. With me today, I have Harry Kirsch, our chief financial officer; Marie-France Tschudin, our president of Novartis Pharmaceuticals; Susanne Schaffert, our president of Novartis Oncology; John Tsai, our head of global drug development and chief medical officer; Richard Saynor, our head of Sandoz; Tom Kendris who is our chief legal officer ad interim; and Samir who you just heard from. So moving to the next slide.

What I'd like to do is give you an overview of our performance and then dive a little bit deeper into the four key areas as part of the overview section before handing it over to our business leaders. First and foremost, we feel confident in the growth outlook of the company particularly given the momentum we're seeing in innovative medicines and the expected stabilization we foresee in the Sandoz business. From a productivity standpoint, when you control for -- forward purchasing we continued the expansion of our core margin and I'll say more about that in a moment. We had multiple important milestones from an innovation standpoint, and I'll go into a little more depth as to some of the upcoming milestones and some of the updates we have in our phase 2 and phase 3 pipeline, which we view as one of the leading pipelines in the industry.

And lastly, in ESG, we continue to our March to being a sector leader within the pharmaceutical and bio biopharmaceutical sector as well as being a leader across sectors, ranked No. 2 in the Access to Medicine Index and No. 1 in Sustainalytics, and I'll talk a little bit more about that in a moment. So going to the next slide, starting with the growth outlook.

Our key growth drivers really demonstrated that they're returning to momentum over Q1. We had strong performance brands such as Entresto, Zolgensma, and Cosentyx on the pharmaceutical side, as well as a very good performance from brands like Lutathera, Kymriah, and solid performance from Kisqali on the oncology side. In addition, Kesimpta is up to a very strong start and Marie-France will talk more about these, the Kesimpta launch. Then when you take it together, our key growth drivers and launches, we're growing 20% and amounting to 48% of our total sales.

And we expect this number to continue to climb over the coming years, enabling us to deliver the mid-term growth we outlined in the mid to March -- to Novartis management presentation we had last November. As a proof point, when you exclude forward purchasing, our innovative medicines business grew 3% in the quarter in constant currencies. And moving to the next slide, we're also confident that we can continue to deliver the core margin expansion that we've committed to. In the near term that would be in the mid to high 30s, in the near term, excuse me, in the midterm, it would be in the high 30s.

And when you look at our Q1 underlying performance when, again, you take into account forward purchasing that we saw last year, the core operating growth is plus 6% and core margin growth of a point bringing us to 36.3%, well on our way to getting to that high 30s goal. The drivers of that expansion were sales momentum on our key -- on our key products as well as the continued productivity program in Novartis technical operations where our goal is to deliver $2 billion in savings in the next few years. And we continue to evolve our ways of working, delivering savings from our newly created customer technology solutions organization, which integrates data and digital as well as Novartis business services to even accelerate the overall way of working inside of Novartis. Moving to Slide 8.

Sandoz did have a difficult quarter, which was impacted by price erosion as forward purchasing and a historically low cost in the cold season. The first thing to note is we were cycling an exceptionally strong prior-year quarter and you can see some of the figures here. But for example, the total sales of Sandoz were up 11% in Q1 2020 and of course, this quarter was down 13%. Now some of the underlying factors that we see impacting this, many of them are sectorwide price erosion of 10% which we saw across Europe and the U.S.

in our key markets. I mentioned the forward purchasing as well as weak demand and cough and cold retail as well as some of the impacts of the retention of the Aurobindo business in oral solid in the -- in the U.S. On a positive note, our biopharma business continues to grow and continues to be a leader in many regions around the world. We expect business -- the business to stabilize in the second half as the pandemic eases.

We expect -- expect our biosimilars to outperform in the competitive European market. We expect to see our retail European business rebound and we also have an increasing number of launches both across biosimilars in geographies outside of the U.S. and Europe as well as in small molecules in the second half. So that'll be a key area of focus for us as we continue to get Sandoz back to growth.

Moving to Slide 9. From a pipeline and innovation standpoint, it was a busy quarter. You're well aware of the approval of Entresto in patients with a below-normal left ventricular ejection fraction update to Cosentyx label and approvals in Kesimpta. In terms of readouts, the division study readout positive on both radio -- PFS -- rPFS as well as on overall survival.

We look forward to presenting that impressive data at an upcoming medical congress. We had the positive readout of Cosentyx in juvenile idiopathic arthritis, which we now are moving toward filing and we'll continue to enable us to expand Cosentyx indication where we have a goal getting to nine indications or formulations to enable Cosentyx to drive -- to continue to drive dynamic growth over this decade. LNP Iptacopan had a positive readout in IgA nephropathy and we'll look forward to presenting that data in the upcoming Congress. We've already initiated the phase 3 program.

You'll remember that IgA nephropathy is one of the larger indications we have for this medicine. We also had the positive readout, which has already stated in PNH and the phase we started there. And we're expecting additional results, which we'll talk about in a moment. We did have the results of Entresto in the post-AMI setting where it had a high hurdle trying to demonstrate superiority to ramipril in a very fragile patient population.

These are patients who had recently had a myocardial infarction. Entresto had a consistent positive trend across all the primary and secondary endpoints but did not meet statistical significance for superiority, it did demonstrate a very strong safety profile and we'll look forward to discussing the data further with -- with regulators in the months to come. And lastly, you're aware of the canakinumab second line readout. So some other designations and submissions in the bottom of the slide.

But I'd like to move to the next slide and take a little bit of time to go through some of the updates on our expected milestones across our -- our key programs in lifecycle management pharmaceuticals and -- and oncology. I already mentioned the Entresto and Consentyx information, we are -- on Consentyx we are on track for the hidradenitis suppurativa phase 3 readouts in the second half of 2021. In Kisqali, importantly, we have completed enrollment of the Agilent study in medium and high-risk patients, Richard Saynor will say a bit more about that with the readout in 2022. With respect to Leqvio, we remain on track for a CRL response to be submitted in the Q2, Q3 timeframe.

We've also completed a tech transfer into our Schaftenau facility in Austria and are evaluating the best way to submit that response now with the FDA. And -- and I think those are some of the key highlights on lifecycle management. Now turning to the pharmaceuticals portfolio, I've already mentioned on LNP023 some of the key milestones. But I -- I think the key thing here is that we're continuing to rapidly move across a broad range of indications into phase 3.

The other highlight I wanted to mention is Branaplam where we have completed the phase 1 study and we look forward to providing that information in the upcoming medical congress. We have also completed discussions with regulators to finalize the phase 2b study design and plan to start that study in the second half of 2021. And then moving to oncology. I think it's very important the canakinumab studies remain on track in the first line in Agilent.

But as important in many ways now the Lu-PSMA study studies in the early lines of therapy and hormone-sensitive prostate cancer is -- have -- have begun and we look forward to enrolling the studies rapidly with a plan readout in 2024. Now, moving to the next slide. You probably will have seen that we've completed the -- our in-licensing agreement for tislelizumab with Beijing. And we did have the readout of two important readout -- studies that will enable submissions over the course of this year.

First and second-line non-small cell lung cancer at AACR. You can see the data here on the right with solid overall survival data. And then also in esophageal cancer, where the study is met -- met is primary endpoint prolonging OS versus chemo and we'll provide that data release as well in the upcoming Congress. So these -- these studies will enable ex-China filings, which are on track for 2021 and we have 15 potential registration enabling studies ongoing as well as a broad range of combination studies in the program.

Then moving to the next slide. I wanted to close just by noting our -- our commitment across the company in areas of high materiality for Novartis to advance our efforts in ESG in returning and building trust with society. I mentioned the ranking we have now on Sustainalytics, we're the only company among our peers that now ranked with low risk in the Sustainalytics ranking. Also, in Access to Medicine Index, the No.

2 ranking. But we were very proud of our No. 1 ranking in product delivery, our ability to bring our innovative medicines to patients most in need in low and low-middle-income countries. Other highlights include an agreement with Bill and Melinda Gates Foundation on bringing transformative therapies to patients in sickle cell disease as well as being included in the Bloomberg Gender-Equality Index.

And of course, you're aware of our ongoing efforts in COVID-19 to provide our manufacturing capacity as well as to collaborate with molecular partners as well as our own in-house oral programs for COVID, our oral protease inhibitor to hopefully bring therapeutics overtime to help with the long-term control of COVID-19. So that gives you a little bit of an overview. I'd like to hand it over now to Marie-France to dive a little bit deeper into pharmaceuticals. Marie-France?

Marie-France Tschudin -- President of Novartis Pharmaceuticals

Thank you, Vas. Good morning, good afternoon. I'm pleased to update you on our Q1 performance for pharma. We had revenues of $6.3 billion this quarter and while the overall growth rate was affected versus Q1 2020, our growth drivers and launches are showing excellent momentum with 23% growth versus the prior year.

What is noteworthy is that half of our revenues are now coming from our growth drivers and launches. This is the result of clear portfolio prioritization and a relentless focus on commercial execution. We've -- we've also doubled down on early launch preparation and our investments reflect that. If we move to Slide 15, Cosentyx, our largest brand delivered double-digit growth.

As we said in Q4, we've seen an access change in one U.S. account which has impacted volumes. Although the shares were affected, we will continue to deliver double-digit growth in the U.S. based on the rebate upside realized and the volume growth over time.

Our overall access remains strong in the U.S. and continues to be a key pillar of our strategy. The other constant is that customers continue to experience Cosentyx as a tried and trusted complete treatment. Now that the shares have adjusted to the new access levels, we are back to our position that we will grow with the market in dermatology and outgrow the market in rheumatology.

In the U.S., our focus is on accelerating volume growth. We're off to a great start in China following our NRDL listing in March. In Europe, Cosentyx continues to be the leading originator biologic across all three indications. As we bring the newer indications to market.

We expect some pricing concessions in Europe and that will only further enable volume-driven growth. The full year, we're confident that the Cosentyx team can deliver double-digit growth based on our strategic pillars, focus on strong access globally, geographic expansion, and our leading industry approach to data. Beyond 2021, our ambitious lifecycle program provides further upside opportunities for the future. Slide 16.  Entresto is doing extremely well with strong growth across the globe.

In the U.S., we're seeing a convergence of events. Physicians are adopting the ATC expert consensus recommendations for Entresto in the first line. We're seeing recovery from COVID and enthusiasm around the expanded indication. It's great to see the growing confidence to go direct to ARNI, which is reflective of the strong evidence behind and Entresto.

We're seeing all-time highs in NBRx. The label in the U.S. now covers five out of six patients with chronic heart failure and this makes it easy for physicians to initiate appropriate patients. We now estimate that about 3.2 million patients are being treated with Entresto today.

This is a big achievement and is a testament to the exquisite execution of the teams in the field. We now have a 30% share of the HFrEF patients in the U.S. So there remains significant room to grow as 70% of rEF patients are still on the prior standard of care and we've only just started to promote in the rEF population. If I move to Slide 17, Zolgensma had a strong quarter, which was driven by reimbursement wins in a number of European markets while the U.S.

continued its steady trend. As every EU country initially has both patients and then moves into a steady state, you can expect to see some volatility in the quarterly sales pattern. We have new compelling data on Zolgensma's efficacy in the pre-symptomatic patient. We're also initiating a new phase 3 trial called SMART to strengthen the confidence of children up to 21 kilograms in the EU.

We're on track with our preclinical studies for the IT formulation, which would also allow us to bring Zolgensma to older children. Our five-year durability data confirmed what is this medicine can offer in one single treatment. And this is what really sets Zolgensma apart and why we are relentlessly progressing our gene therapy agenda with two more INDs plan this year. If we move to Slide 18, with Kesimpta, we're bringing a high efficacy B-cell therapy to patients early in their disease.

Our new PIRA data builds on the strong efficacy profile already shown in our pivotal trials. Kesimpta can reduce disease progression that happens independent of relapses by up to 60% when used early. We believe this is incredibly meaningful data for patients because PIRA actually accounts for the majority of progression, the state is unique in this early patient population. While the pandemic is still impacting the dynamic market and the prescribing behavior, all the metrics that are in our control are tracking positively.

We're seeing more than 50% use in the first line for a switch, which is exactly aligned to our value proposition. The team has also done a great job on access. In fact, the conversion from the free-to-paid product is ahead of plan. This is reflected in the Q1 numbers, which also include a $9 million revenue adjustment relating to Q4 2020 and why we now expect 65% of sales in the second half of the year.

Recent data also shows that the IgG levels of patients on Kesimpta are maintained over time, which is important to fight infections including covered and reinforces our safety profile. Once the market bounces back, we expect strong uptake for this product based on the compelling product profile and the growing evidence base behind the brand. Remember that we designed this brand specifically for multiple sclerosis. As you can see from the data, we are achieving sustained depletion with monthly dosing and we're not seeing a rebound between doses.

With a high and sustained efficacy and the opportunity for at-home treatment, Kesimpta has what it takes to fundamentally change how we treat multiple sclerosis. Slide 19. Leqvio was launched in Germany and Austria in February in the limited population of patients at very high cardiovascular risk. Physicians seem happy with the immediate drop they see in LDL-C levels and with the ability to have the sustaining effect with only two injections per year.

In Europe, we need the outcomes data, which we expect in 2026. So in the meantime, we want to advance discussions on population health approaches as our goal is to bring this medicine to a broad population as quickly as possible and this way significantly lower the burden of ASCVD on patients and systems. The U.K. NHS agreement is our first such agreement and is on track for launch in Q3, more to come.

In the U.S., we're on track to resubmit our file in Q2, Q3. While we're preparing our filing, we're also actively engaging with a large number of U.S. healthcare systems to lay the foundation for broad uptake.In summary, we continue to focus on executing our strategy, maximizing our growth drivers, delivering our launches, preparing our next big best. Our growth drivers are doing very well.

Our launches are gaining momentum. Now, these accounts for half our sales. As we see a more dynamic market environment, we will continue to accelerate our portfolio shift and double down on patient HCP and healthcare system engagement in order to enable access to more patients faster. I want to thank the teams around the world who worked so hard to achieve this every day.

Over to Susanne.

Susanne Schaffert -- President of Novartis Oncology

Thank you. Marie-France. So let's move to Slide 21. Our oncology business has delivered solid performance in the first quarter.

Its net sales of $3.8 billion broadly in line with the previous year. Our key growth drivers continue to perform well including Kymriah, Kisqali, Promacta/Revolade, and Jakavi. Both our growth brands and recent launches together grew 15% versus the previous year and contributed to almost half of the overall oncology sales, allowing us to more than compensate for the continued generic erosion of Afinitor and Exjade/Jadenu in the U.S. and Sandostatin LAR in the EU.

The first quarter was marked by the continued impact of the pandemic on certain segments of our portfolio with a more pronounced effect on hospital-initiated therapies, our breast cancer portfolio, and recent launches. Due to the pandemic, patients did not see their physicians at the same frequency in diagnosis, and treatment initiations remained below pre-pandemic levels. However, we remain confident that patient visits to hospitals will resume and treatment patterns will normalize leading to acceleration of growth in these segments. Moving to Slide 22, just to remind you that we are the only pharmaceutical company which is pursuing four different cancer treatment platforms.

These include radioligand therapy, cell and gene therapy, targeted therapy, and immunotherapy with an opportunity to combine these platforms for better outcomes. Today, I wanted to especially reflect on our progress, this radioligand therapies. Since the acquisition of AAA in 2018, we have established strong global expertise in commercializing radioligand therapies, supported by a specialized supply chain-manufacturing capabilities across for radioligand therapy production sites. With Lutathera, our radioligand therapy for neuroendocrine tumors, we have gained a lot of momentum and in partnership with now 400 centers.

We are able to deliver this life-saving treatment to more than 9,000 patients since launch. We have generated a unique skill set and experience in manufacturing, supply, and commercialization of radioligand therapies, and we will leverage these to maximize the potential of our future launches in this space. On the development side, we're advancing four clinical programs and around 11 preclinical and discovery programs to identify the next wave of radioligand therapies for cancer. We continue to invest in our radioligand pipeline through the in-licenses of a library of fibroblast-activating protein or fat-targeting agents.

The investment into active oncology for development of alpha-based radioligand therapies and our most recent collaboration with Artios Pharma to discover and identify novel combinations of DNA Damage Response inhibitors with RSGs. Moving to Slide 23, earlier in March, we're very excited to share with you data from the VISION study with Lu-PSMA in metastatic castration-resistant prostate cancer and the trial met both primary endpoints of improved overall survival and radiographic progression-free survival versus standard of care. Just to remind you, prostate cancer is the second-most diagnosed cancer globally. And in the majority of cases, patients, unfortunately, develop metastases by the time of castration-resistant prostate cancer diagnosis.

There is a significant unmet medical need in this population with a five-year survival rate of approximately 15%, and they have very limited treatment options. The VISION study findings confirm that Lu-PSMA has the potential to become the targeted treatment for more than 80% of men with late-stage advanced prostate cancer. We intend to initiate discussions with regulatory authorities and prepare submissions to the FDA and EMA by the end of this year. On the commercial side, we are effectively preparing for the upcoming launch with a focus on hospital and community centers.

More than 70% of prostate cancer patients are treated here. Given the prevalence of the disease, we are working with treatment centers to better understand their operational needs for capacity expansion in order to administer targeted radioligand therapies. Additionally, we are raising awareness on the clinical relevance of PSMA and the potential value of targeted RSGs as a new mechanism of action in advanced prostate cancer. On the development side, the VISION trial findings are supporting our confidence in moving into earlier lines of advanced prostate cancer.

We are planning a phase 3 study with Lu-PSMA in the pre-taxane metastatic castration-resistant prostate cancer setting and in the metastatic hormone-sensitive setting. We anticipate that both of these studies will start in the first half of 2021. Moving to Slide 24, Kisqali delivered a solid performance in the first quarter with sales up 19% reaching $195 million, driven by unprecedented overall survival benefit from two pivotal phase 3 trials. We are very pleased to see Kisqali continue to grow strongly and gaining market share ex-U.S., especially on European markets.

In the U.S., Kisqali maintains share despite the overall slowdown of the CDK4/6 market, driven by the suppressed diagnostics rate and overall degrees in new patient starts. We believe Kisqali has a unique profile, supported by the longest-reported median OS among all phase 3 trials in advanced breast cancer reaching around five years in premenopausal patients. Therefore, we remain confident in the longer-term potential of Kisqali. On the development side, NATALEE adjuvant study in intermediate and high-risk population has completed enrollment ahead of plan, and we are on track for final readout in 2022.

So, overall, we are confident with Kisqali resilient performance in what continues to be a challenging market environment. And with that, let me hand it over to Harry.

Harry Kirsch -- Chief Financial Officer

Thank you, Susanne. Good morning and good afternoon, everyone. I'm now going to walk you through some of the financials for the first quarter, as well as provide you with an update on our '21 guidance. As always, my comments refer to growth rates in constant currencies unless otherwise noted.

So, Slide 26 shows a summary of our operational performance for the first quarter. As we indicated at the start of the year, quarter one growth was negatively impacted by prior-year quarter one forward purchasing which amounted to around minus 3% points on sales and minus 7% points on core operating income. This quarter also still had a continued demand impact for COVID-19, particularly at dermatology, ophthalmology. Our breast cancer portfolio and for the Sandoz retail and anti-infectives businesses.

Free cash flow was impacted this quarter by the $650 million upfront payment for tislelizumab in-licensing from BeiGene. I would give more detail about free cash flow later in the presentation. With these caveats, you can see the changes in net sales and core operating income, minus two points and minus eight points, respectively, which flowed out into EPS and free cash flow. Turning to Slide 27, we have shown the change with the prior year for sales core operating income and core margins in the first quarter as reported on the left-hand side of this table.

On the right-hand side, as we did a similar chart last year quarter one, we have illustrated what the underlying operational performance looks like if we excluded the prior-year forward purchasing. Innovative medicines had a solid underlying performance. Sales grew plus 3%, core operating income plus 6%, and core margin was up plus 1% point. Innovative medicines' performance was driven by continued strong double-digit growth of all the key growth drivers like Entresto, Zolgensma, Cosentyx.

And our oncology growth drivers, partly offset by mature product declines and generic erosion. For Sandoz, we would still have seen a challenging quarter. Excluding prior-year forward purchasing, Sandoz's sales were still down minus 9% and core operating income was down minus 29%. As Vas explained earlier, some of the key challenges for Sandoz were the pricing impact, and historically low cough-and-cold season, and softer retail demand as a result of COVID.

At the group level, underlying performance adds up to plus 1% of sales, and core operating income declined minus 1%. Let's now go to Slide 28. One way of better understanding the underlying performance, given the distortions caused by COVID over the last year, is to compare to what you could call a normal first quarter in 2019 with quarter one 2021. On this slide, we have showed what happens to group and innovative medicines over the last three quarter ones for both top and bottom line.

We show the CAGR for both and you can see that for group sales, CAGR was a solid plus 5% and core operating income CAGR was plus 11%. This is clearly driven by innovative medicines with the top line growing at a 7% CAGR and the bottom line even at 13% CAGR, which shows the strong operational performance of our innovative medicines division. Innovative medicines' core margin increased by 300 basis points over the two years was the result of our good top-line growth, combined with very good progress on productivity programs. On Slide 29, you can see that free cash flow for the quarter was $1.6 billion.

The most significant reason as mentioned for this decrease was the $650 million upfront payment to in-license tislelizumab from BeiGene and lower operating income adjusted for non-cash items, partly offset by favorable changes in working capital. Now, turning to our full-year 2021 guidance on Slide 30. We confirmed full-year guidance both for group and innovative medicines for sales and core operating income. For innovative medicines, we continue to expect mid-single-digit sales growth in 2021.

For Sandoz, reflecting the start of the year, we now expect sales to decline low to mid-single-digit revised downwards from the prior proudly in-line guidance for Sandoz. Now, as an exception to our regular guidance format and due to the impact COVID had on Sandoz's quarter one results, we're also going to provide for this year the breakdown of core operating income guidance by division. We expect innovative medicines' core operating income to grow mid to high-single digits ahead of sales. And for Sandoz, we expect core operating income to decline low to mid-teens.

The key assumption for this guidance remains that we see a return to normal global healthcare systems and prescribing dynamics by mid-2021. And in addition, we continue to assume that no Gilenya and no Sandostatin LAR generics enter in 2021 in the U.S. Turning now to my last slide, several of you asked for a bit more detail on quarterly saving. On Slide 31, I've tried to explain the dynamics that we expect to see in quarter two and for the full year, given the impact on COVID -- of COVID both in 2020 and '21.

As you recall, at the start of the year, we guided to expect quarter one sales to decline low to mid-single digits. And underlying sales, excluding prior-year forward purchasing to be proudly in line with prior year. This was the case, and as already explained, sales excluding prior-year forward purchasing grew plus 1% on quarter one. For quarter two, we expect sales to grow mid-single digits benefiting from approximately plus 3% points of prior-year forward purchasing reversal.

For core operating income, in the first half of 2021, we expect it to decline low-single digits due to prior-year, lower-cost base, and investments in quarter two of 2021 to support the second-half growth. In summary, quarter one showed a solid underlying performance for innovative medicines, challenging for Sandoz but allowed us to reconfirm our full-year guidance. In quarter two, we expect to benefit from the reversal of forward purchasing and some improved momentum in the U.S., given the speed of vaccinations in that key market. Our current and expected performance also allows us to reiterate our confidence that we will grow top and bottom line every year to 2025 and meet external expectations.

And with that, I'll hand it back to Vas.

Vas Narasimhan -- Chief Executive Officer

Terrific. Thank you, Harry. I wanted to highlight before closing that we do have a catalyst-rich period coming up for the remainder of this year. A number of submissions, as you see here on the chart, a -- a number of important readouts that would enable submissions either this year or next year.

So, we'll look forward to keeping you up to date on these readouts as they happen over the course of this year and also present the data at major congresses. So, moving to the next slide and in closing, I think you've heard now from all of us that we have confidence in our growth drivers and launches to continue their strong momentum. You've seen that underlying performance is starting to come through and momentum is picking up. Solid IM top and bottom-line performance and even when you take into account the prior-year purchasing, you really see the underlying performance come through.

Our broad pipeline of novel medicines in phase 2 and phase 3 continue to progress well and we're confident in delivering our 2021, and more importantly, our longer-term top and bottom-line growth outlook. So, with that, operator, we can open the line for questions. I would ask questioners to limit yourself to two questions as we have a -- a lot of people in the queue. Operator?

Questions & Answers:


Operator

Thank you. [Operator instructions] Your first question today comes from the line of Mark Purcell from Morgan Stanley.

Mark Purcell -- Morgan Stanley -- Analyst

Yeah. Thank you very much for taking my questions. So, one on cardiovascular outcomes studies, one on Kesimpta piece. In terms of the ORION-4 study, I -- I just wondered if there's anything more you can say about the delay from December 24 to 2026.

And whether, given you're still recruiting patients, this study I think is run by Oxford University where there's the options to add more patients to try and expedite the readout. The reason why I asked is that there's been a recent update for TQJ230 and the HORIZON study is still on track to complete in March 2024. So, I'm not sure what's unusual or otherwise about ORION-4. And then secondly on -- on Kesimpta, Marie-France, one for you.

Could you help us understand the -- the latest NBRx share trends in the United States? And as the sort of patient flow comes back and your promotion there responds in kind, where do you feel the NBRx share should evolve during the course of this year? Thank you.

Vas Narasimhan -- Chief Executive Officer

Great. Thanks, Mark. So, John, do you want to take the CV outcomes study?

John Tsai -- Head of Global Drug Development and Chief Medical Officer

Sure. Will do. Thanks, Mark. Thanks for the question on Adakveo.

As we noted in Meet Novartis Management last year at the end of the year that our expectations for Adakveo at that time was conclusion in 2025. We've seen a pretty significant impact, as you know, we're doing this study with -- with the Oxford Group where the majority of our patients are recruited from the U.K. And as we've seen both with COVID and then the additional variants with the impact of COVID in the U.K., recruitment has been challenging. Initially in December as we saw, there was an uptick in COVID cases in the U.K.

And then subsequently, throughout the first quarter of the year in the U.K., there was a significant impact of COVID. So, based on the recruitment timelines, we actually have deferred the study results to 2026. Because during that time, I think the healthcare systems were overwhelmed with taking care of COVID patients, so it was very difficult to recruit these patients. As we've had discussions with the Oxford Group, I think recruitment is starting to tick back on track and we're working very closely in terms of a report -- report out of the results in 2026.

Vas Narasimhan -- Chief Executive Officer

Thank -- thanks, John. Just one additional note. Across other studies like TQJ where we had a global footprint, we've been able to flex our recruitment around the world to maintain timelines. In this particular study, we've been given a high proportion of patients in the U.K.

NHS, so this was a -- a bigger impact. We, of course, look at all ways to expedite the -- the study in the meantime. On Kesimpta, Marie-France?

Marie-France Tschudin -- President of Novartis Pharmaceuticals

Yeah. So, thanks for the question. The first thing to note is that our -- our U.S. launch is progressing really well.

And as I said in my opening remarks, the areas that are under our control are -- are progressing really well. We talk about positioning, we talked about the first line, first switch at 50%, ease of initiation which was very important for us, and access where we already have 75% of commercial lives covered. So, based on that, we -- we saw that paid product is going faster than expected. And we're also looking at 65% of sales in the second half of the year, previously we had said 75%.

If I pivot to NBRx, we're currently at 10%. But as you know, the dynamic market is still suppressed, and we see hesitations to switch patients or to initiate patients on B cell therapies prior to vaccinations. As the market bounces back and as we see vaccination campaigns progress, I believe that we'll -- we'll see a significant uplift in the NBRxes for Kesimpta. We're also bringing in additional markets or Kesimpta to additional markets and can also expect strong uptake based on the efficacy.

As we said, you know, we talk about one relapse every nine to 10 patient years. And now, we've got additional evidence that shows that Kesimpta reduces risk of progression independent of relapses by up to 60% in naive patients. So, all of this points to a tremendous opportunity for -- for patients and for this product. We're also very confident that we'll see a -- a big expansion in the B cell market.

So, currently, we see around 30% in the U.S. and we expect that number to get to 50% over the next couple of years.

Mark Purcell -- Morgan Stanley -- Analyst

Thank you.

Vas Narasimhan -- Chief Executive Officer

Thanks, Marie-France. Next -- next question, operator.

Operator

Thank you. Your next question comes from the line of Graham Parry from Bank of America.

Graham Parry -- Bank of America Merrill Lynch -- Analyst

Great. Thanks for taking my question. So, another one on Kesimpta [Inaudible] and the free versus paid-for. I think you previously said it was around 30% paid for you're aiming to get that to 70% by the end of the year.

So, if you could just give us an update on where you are now and where you expect that to be at the end of the year that drives the -- the 65% number. And then secondly on Sandoz, just -- you talked about stabilization in the second half of the year. But some -- if, you know, margins are down largely because of price, is there a risk this does -- just doesn't reverse thereafter. So, perhaps help us understand what happens in 2022 and -- and where are you in terms of the separation of Sandoz into a fully autonomous unit inside Novartis? I think you said it was probably around the middle of this year that would be complete, and is that the point to which you then decide whether Novartis remains the best owner of Sandoz? Thank you.

Vas Narasimhan -- Chief Executive Officer

Thanks, Graham. On -- first on Kesimpta, back to you Marie-France.

Marie-France Tschudin -- President of Novartis Pharmaceuticals

Yeah. So, currently, we have about 2,400 patients treated on Kesimpta. And as you pointed out, we have a 12-month bridging program. When we -- when we discussed this at the end of Q4, we -- we were actually looking at 30% paid with 70% free.

That -- that is radically changed. So, it looks like we flipped those numbers and we're currently at 70% paid product. We expect that to get up to 80% for the -- the rest of the year and that's why we've changed our percentage sales for the second half of the year from 75% to 65%.

Vas Narasimhan -- Chief Executive Officer

Great. And then on Sandoz's stabilization and dynamics, Richard.

Richard Saynor -- Chief Executive Officer of Sandoz

Thank you, Graham. We've already assumed the level of price erosion going through the rest of the year. You got to remember, a lot of that's been driven because of volume declines we saw in Q1. And with volume declines, you saw a stabilization in the market, service levels go up.

And invariably, that means that the competition for price goes up as well. We've seen that will start to wash through and wash out as we go to the second half. We also assume that will be a normalization in demand, patients start returning back to hospital elective surgery. And we also anticipate a slightly stronger cough and cold season, given that it really had very little this season with social distancing.

So there's a number of drivers, and we've already assumed a level of price erosion going on through the rest of the year.  I'll let Vas comment on the Sandoz in autonomy.

Vas Narasimhan -- Chief Executive Officer

Yeah. Thanks, Richard. So -- and thanks, Graham. On Sandoz, we've now successfully separated the manufacturing unit with links to our global manufacturing.

And I think in most of the relevant area, Sandoz is now enabled to compete at the relevant cost structure and flexibility to be successful as a leading generics player. Our focus now is to get Sandoz, as we've stated consistently, to a consistent mid-single-digit sales growth and core operating margins that are in line with the top end of the peer set, which would be in the high 20s. And that's where our energy and focus is. A lot of that is getting to world-class launches and biosimilars, getting our oral solids business and launches back on track in the U.S., as well as being at market formation for key launches in Europe, and that's what we're really focused on at the moment.

Thanks, Graham. Next question, Operator?

Operator

Thank you. The next question comes from the line of Andrew Baum from Citi.

Andrew Baum -- Citi -- Analyst

Thank you. A couple of questions, please. With inclisiran, you attained a pre-approval agreement with the U.K. I'm wondering whether you have or will be entering into similar agreements with European territories for your PD-1 license from BeiGene? That's the first question.

Second question is, could you talk to which subpopulations [Inaudible] within the U.S. where you may be able to get on trade with tislelizumab. And then finally, if you have a second to comment on how you look at the competitive outlook for the centers given we've been surprised by ophthalmologists' feedback on brolucizumab ahead of anticipated approval. Thank you.

Vas Narasimhan -- Chief Executive Officer

Great. Thanks, Andrew. So both PD-1 questions in Europe and U.S., Susanne.

Susanne Schaffert -- President of Novartis Oncology

Yeah, sure. Thank you, Andrew. So, you know, our ambition is to provide global access to tislelizumab is in the broad array of indications. As, you know, BeiGene is running a very broad development program, you know, and that is really our first ambition.

We really want to establish tislelizumab in key indications, where PD-1s are currently market, and also pursue novel combinations with our portfolio. So really, short term, the focus is on getting first indications filed. We plan to file in non-small cell lung cell cancer and esophageal cancer. And we expect these to be submitted in the second half of 2021.

You know, on specific agreements, I don't want to comment. You have seen the data. We have very solid OS data presented at AACR. And we believe that tislelizumab is a very differentiated PD-1.

So in terms of subpopulations, we, of course, want to make sure that we focus on the areas where tislelizumab is differentiated. And I think the two data readouts show that I think there is still space for a strong PD-1. So that's for now, and then we work through reimbursement agreements while we then prepare for launch.

Vas Narasimhan -- Chief Executive Officer

Thanks, Susanne. And then on Lucentis, Marie-France?

Marie-France Tschudin -- President of Novartis Pharmaceuticals

Yeah. So Lucentis did really well in Q1. It's growing 4% due to the steady performance in Europe. So there is some rebound.

We can expect to see that to continue. And also the strong NRDL-driven momentum in China, which is definitely where we're looking to see a good chunk of our growth this year. So for the remainder of the year, we expect to see Lucentis grow at low single digits, and again, with China being a major driver. In terms of the competition, just to remind you that Lucentis is really established in the market, and we believe we'll continue to do well.

One of -- one of the key drivers is just a very complete indication portfolio that Lucentis has and that newer products will not bring to market immediately.

Vas Narasimhan -- Chief Executive Officer

Thanks, Marie-France. Thank you, Andrew. Next question, Operator.

Operator

Thank you. Your next question comes from the line -- so your next question comes from the line of Keyur Parekh from Goldman Sachs.

Keyur Parekh -- Goldman Sachs -- Analyst

Hi, good afternoon. Thanks for taking my questions. Two, please. One, Vas, I know you kind of suggested that the Sandoz separation is kind of the independent company is kind of on group.

But can you just remind us conceptually the positive, the negatives from a Novartis perspective of keeping Sandoz in-house, kind of it's been a drag on your growth as long as one can remember? So just conceptually, why does it belong within the Novartis equity story would be great. And then separately, for Marie-France on Zolgensma. As we think about kind of the next few quarters, can you just remind us of the incremental countries you're going to be launching the product in and the size of the bolus opportunity in those countries? Thank you.

Vas Narasimhan -- Chief Executive Officer

Yeah Thanks, Keyur. So on Sandoz, there's, I think, a few considerations. One, historically, and we continue to believe in certain markets, there is commercial synergies in having a broad portfolio across generics and innovative medicines. We, of course, continue to challenge ourselves and evaluate that, but we do have those agreements in certain markets.

And that, yeah, depending on how healthcare systems evolve in the future, it could be an advantage to have one of the largest, if not the largest by volume generics company in the world. The other part of the story, of course, is biosimilars, where our manufacturing scale and know-how enables us, as well as our development expertise, enables us to -- enable Sandoz to build a leading biosimilars portfolio and then, of course, the company will benefit over time. And we're hopeful that the, you know, the Sandoz biosimilars portfolio can help us get Sandoz to that mid-single-digit growth up on the margin spectrum and then contribute to the growth of the overall -- overall company. Those, I think, are the two key considerations.

There is, of course, the broader software consideration that Sandoz serves hundreds of millions of patients and provides billions of doses to humanity, which is consistent with the overall purpose of the company to reimagine medicine. So on Zolgensma, Marie-France?

Marie-France Tschudin -- President of Novartis Pharmaceuticals

Yeah. So in the U.S., our business is driven by the incident patients. So the growth ex-U.S. is coming from these recent reimbursement wins in Europe.

For the rest of 2021, we expect the U.S. business to remain stable and to be -- continue to be driven by the incident patients. In Europe, we're working on securing reimbursement in additional countries. Right now, we've seen good uptake in Germany and recent reimbursement and acceleration in smaller markets, such as Czech Republic or UAE.

If we look at the nature of the European markets, we also expect to see reimbursement on a rolling basis. What you can expect going forward is the U.K. and Italy, where we've now secured reimbursement, and that will bring Zolgensma to additional patients. As we said before, the initial source of business in all of the launches comes from previously treated patients.

And over time, that patient mix shifts to the incident population. Overall, for 2021, we expect blockbuster status with Zolgensma.

Vas Narasimhan -- Chief Executive Officer

Thanks, Marie-France. Thanks, Keyur. Next question, Operator.

Operator

Thank you. Your next question comes from the line of Emmanuel Papadakis from Deutsche Bank.

Emmanuel Papadakis -- Deutsche Bank -- Analyst

Thanks for taking the questions. Emmanuel Papadakis from Deutsche Bank. Maybe a couple of products, specific ones. Just on the pipeline phase 2, we're going to see the IgA data relatively soon, obviously, perhaps you could give us any commentary around the conference.

And just -- I mean, in terms of the data [Inaudible] primary or secondary endpoint with UPCR, should we expect to see a consistent benefit on the key secondaries like eGFR? And what would you regard as a clinically meaningful improvement on the primary and any key secondaries? And then maybe a question on the SHP2 TNO155. Just your take on any ramifications from some competitor data we saw at AACR. Can you just remind us of confidence on that program's potential and when we should be looking to see the first KRAS combination data? Or if you no longer believe that is the most promising combination, what we should be particularly anticipating in terms of the various combinations studies, you know, ongoing that molecule. Thank you.

Vas Narasimhan -- Chief Executive Officer

Thanks, Emmanuel. So, John, you want to start on IgA nephropathy?

John Tsai -- Head of Global Drug Development and Chief Medical Officer

Sure. Thanks for the question, Emmanuel. As you know, for iptacopan, we're looking across a number of indications, including IgA nephropathy, also C3 glomerulopathy, as well as PNH. Specifically, in IgA nephropathy, we do have the phase 2 dose-range finding study, which is ongoing.

We've had an interim readout and based on that interim readout, we've already decided to advance into the phase 3 studies. Those results will be coming out before the half of the year. The specific conference, we -- the posters and abstracts have not been released. So we've refrained from telling you exactly, but we are confident that those results will be presented before the first half of the year.

And as I said, you know, the phase 3 has advanced as we move forward in IgA nephropathy and the expected filing is based on conditional approval for proteinuria reduction at nine months. So these are the same results in the phase 2, which we have in the phase 3 study. And as you asked about the secondary endpoint, these are the same secondary endpoints that we have in our phase 3 study. The final approval, which is expected to be in 2025 is based on the eGFR slope.

And this was the phase 2 study that we had in place and also is the endpoint also for a full approval expectation in 2025 based on results. So I think the second question that you had was around the SHP2 -- our SHP2 inhibitor, and how should we be thinking about the SHP2 inhibitor as we move forward. As you know, SHP2 is as tyrosine phosphatase and exit a really important note as we look at the RAS MAP kinase pathway. And in preclinical studies, what we saw was not only single-agent activity but also in combination with other agents.

Our strategy for our SHP2 inhibitor is that we expect to go broadly in terms of a number of combinations. And as we look at the approach that we're taking, there's four potential areas that we're currently looking at. First is in combination with our own eGFR agent. This would be our third-generation eGRF agent -- eGFR agent, and this would be our first consideration for combination with our SHP2 inhibitor.

Secondly is looking at the role of SHP2 in immune cells. And so that consideration would be with PD-1, and we have a study ongoing with spartalizumab. Thirdly, would be looking at the MAP kinase RAS pathway as we look at the combination with potentially KRAS C12C. And also, we have a study in place with [Inaudible].

And then fourth would be we currently have an early study in combination with dabrafenib, trametinib as we look at the treatment for BRAF V600-mutant CRC patients. So we have high expectations in combination with our SHP2 inhibitor looking broadly in addition to the KRAS C12C pathway. Thanks.

Vas Narasimhan -- Chief Executive Officer

Thanks, John. And maybe just to highlight again, you know, we're not focused here on single agent. I couldn't see your question, Emmanuel. We really think the opportunity for SHIP2 will be in combination, and hopefully, in combination with a range of agents, and that data should come out over the coming 18 months.

Next question, Operator.

Operator

Thank you. Your next question comes from the line of Matthew Weston from Credit Suisse.

Matthew Weston -- Credit Suisse -- Analyst

Many thanks. Two questions, please. The first on U.S. tax reform.

So Novartis, like many in the pharma industry, is a major beneficiary of transfer pricing. I'd be very interested in Harry's view of the long-term tax rate given the discussions that are being had or proposed by President Biden about changing the way multinational tax is calculated with minimum revenue-based metrics on a national approach. And I -- also in the shorter term, if you could just give us some update as to the likely nearer-term impact of anything we've learned from the near-term U.S. domestic Biden tax changes, that would be extremely interesting.

And then secondly, a product-specific question regarding the DARPin collaboration in COVID. Can you just give us an update on the project, both in terms of the early clinical data that we've seen on the first stop and how the tech transfer is progressing to Sandoz, and your thinking as to when we might have something to file from that program?

Vas Narasimhan -- Chief Executive Officer

Yeah. Thanks, Matthew. So first on tax reform, Harry?

Harry Kirsch -- Chief Financial Officer

Hi, Matthew. So as you know, this year, we guide to about 16% core tax rate. Last year, it was 15.4%. You know, we see in the midterm the 16% to 17%, given the current tax loss.

Now, of course, the Biden proposal, the U.S. part would not be a positive for anybody, if you will, right, from a tax rate standpoint. But our exposure to the U.S., if you will, is relatively low given that the majority of our IP and a lot of substance is in Switzerland. And the other issue with all of this is, of course, there not many details are available.

And therefore, I don't want to go into any speculations because we don't know if and what will be in the end implemented. We don't see anything changing for this year or any time soon. At the moment, we have details, of course, we would come up with the respective scenarios.

Vas Narasimhan -- Chief Executive Officer

Great, thanks, Harry. And then on the Molecular Partners collaboration, just to remind the group, the idea here was to pursue the DARPin technology, which is a naturally occurring -- a naturally occurring protein-based molecule that acts in a completely different way to monoclonal antibody, though with a similar effect. The first DARPin -- set of DARPins for COVID showed very strong preclinical efficacy in preclinical models, also against the variants. At the Molecular Partners-Novartis collaboration.

We've completed the phase 1 study, which will enable a phase 2-3 start shortly. We target a readout in the Q3 time frame, which we expect to enable an emergency use authorization, if positive. The benefits of this approach would be: one, the potential for a subcu injection versus IV; and two, because this technology can be produced in bacterial fermentation or used fermentation, I should say, much lower COGS for the medicine, which would enable hopefully, broad-scale use. Also, much higher volumes could be produced versus mammalian cell monoclonal antibodies.

So a lot to still work through and figure out, but we're working through it now. And hopefully, this -- with the study start and then the ultimate readout over the course of the summer. Thank you, Matthew. Next question, Operator.

Operator

Next question comes from the line of Richard Parkes from Exane BNP.

Richard Parkes -- Exane BNP -- Analyst

Hi. Thanks for taking my questions. Firstly, on Zolgensma, just in the U.S., I just wondered if you could talk a little bit more about where you are in terms of penetration of the incident SMA patient population. It looks like it's just in the 60%, but I wondered what room there was for that to move higher based on screening improvements.

And maybe you could discuss that and where you are in terms of share among the various treatment options in that population that has been impacted by the Evrysdi launch. Also, I remember you talking about seeing physicians delaying starts due to COVID. I'm just wondering whether that's no longer the case. Then second question is we've heard from some of the management teams that seem to be expressing some optimism but a compromised solution on U.S.

drug pricing could be achievable given the current balance of power in the Senate. And I just wondered what Novartis's perspective on that was and your thoughts on what might happen medium term. Thanks very much.

Vas Narasimhan -- Chief Executive Officer

Yeah, thanks, Richard. So I'll just quickly take the Zolgensma U.S. question. You know, for Zolgensma right now, the principal driver of business is the newborn screening programs around the country, which in those screening programs, very high, nearly all patients tend to get Zolgensma.

Right now, newborn screening is covering about 70% of newborn lives. We hope to get that number up to 82% before the end of the year. And that would be then the -- the steady-state driver for Zolgensma. And then we continue to see some utilization in switch patients who are in the so-called prevalent pool or on an alternative therapy and then switch to Zolgensma.

So we do believe we're at a steady state in the U.S. with some potential growth as newborn screening continues to expand over the coming years. And that's kind of how we think about the U.S. Zolgensma opportunity.

As we stated in the presentation, we continue to work through the nonhuman primate studies to enable AVXS-101 intrathecal to be lifted off of clinical holes, and then we would rapidly want to advance that program through phase 3 studies. We have agreement with FDA on the design of that phase 3 clinical trial. Now in terms of U.S. drug pricing, we're absolutely supportive of finding a path forward to enable broader and more affordable patient access at the pharmacy counter which would likely include reforms to the benefit design in Part D, as well as elements of the design in Part B.

I think we saw the outlines of that potential, you know, agreement in the Grassley-Wyden bill last year. But we are cautiously optimistic that we might be able to come to a thoughtful agreement that preserves the industry's ability to invest in innovation and then also enables broader patient access. But as you know, there are multiple moving parts. The situation is quite fluid.

I think the big shift is that the industry is working to be part of the solution here, working actively with the relevant stakeholders to try to find a sensible set of legislations. Thank you, Richard.

Richard Parkes -- Exane BNP -- Analyst

Thank you.

Vas Narasimhan -- Chief Executive Officer

Next question, operator.

Operator

Thank you. Your next question comes from the line of Laura Sutcliffe from UBS.

Laura Sutcliffe -- UBS -- Analyst

Hello, thank you. Firstly, excluding the impact of forward purchasing, you had both operating income growth and margin expansion this quarter. And I realize this could be difficult to pick apart. But how much were you still benefiting from cost savings that you might not ultimately get to keep in the first quarter? And secondly, for the two ex-China filings you're expecting to make for tislelizumab this year, could you confirm whether or not you expect those to include the U.S.? Thanks.

Vas Narasimhan -- Chief Executive Officer

So I think quickly on the second point, yes, they would include the U.S. And then on the question on cost savings, I will give it to Harry. Harry?

Harry Kirsch -- Chief Financial Officer

Yeah, thank you, Laura. So of course, we had still some lower activity in Quarter 1. But when you look at the cost levels, they are pretty much in line even the -- with prior-year Quarter 1 when the shutdown came mainly only in the second half of March. So -- and then secondly, we are, of course, also driving new ways of working to keep the good things, if you will, of the situation to run the company more effectively, and of course, also our customer-facing colleagues, you know, have a mix of tools which where face to face is most effective and wanted.

Of course, that happens. But also the virtue and other interactions. So I would say most of the cops -- cost savings we can keep. On the other hand, some increased investments will happen in Quarter 2.

And of course, all of that is part of our full-year guidance.

Vas Narasimhan -- Chief Executive Officer

Thanks, Harry. Thanks, Laura. Next question, operator. 

Operator

Thank you. Your next question comes from the line of Simon Baker from Redburn.

Simon Baker -- Redburn -- Analyst

OK. Thank you for taking my questions. Two please if I may. Firstly, on Zolgensma, going back to the European situation.

Could you give us a little bit more color on -- on where the growth was coming from in the quarter. It's -- from what you've said, it sounds like it's still the prevalent population in Germany given the timing of the -- the U -- U.K. and Italian reimbursed. But any -- any color on that would be useful.

And on to Cosentyx, perhaps you could give us your thoughts on the competitive landscape within psoriasis Cosentyx in light of the -- the MacKenzie map data a few days ago. And secondly, on Cosentyx, can you say your thoughts on the Cigna debit card initiatives to try and move people off Cosentyx and onto alternative products? Thanks so much.

Vas Narasimhan -- Chief Executive Officer

Thank you, Simon. So first, on the Zolgensma growth, Marie-France?

Marie-France Tschudin -- President of Novartis Pharmaceuticals

Yeah. So when we look at the European business, the -- the -- the incremental uptake has been mainly in Germany. And as I mentioned before, we've seen acceleration in some of the smaller markets. So Czech Republic, UAE, and Qatar.

We -- we have not yet seen the uptake in the U.K. and Italy, and that's what you can expect to see toward the end of the year. So as -- as we said before, we will be moving from incident segments to -- to additional countries where you'll see this initial bolus of patients, and then they'll transition to an incident population as what you see in -- in the U.S. So you can -- you can expect some volatility in -- in the quarterly sales pattern because, of course, it's a one-time treatment.

So every quarter, we start again from -- from -- from scratch. But that's what you can expect to see. We're bringing in new countries. We -- we have a number of countries that have day-one access agreements, and we hope to bring about 15 countries with full reimbursement by the end of 2022.

And then going --

Vas Narasimhan -- Chief Executive Officer

Yes, Cosentyx. Yeah.

Marie-France Tschudin -- President of Novartis Pharmaceuticals

Yeah. So on Cosentyx, your two questions. So on -- on the competitive overview, the -- the first thing that I'd say is that we have to remember, in -- in this marketplace, so you -- you -- you referred to psoriasis. The biologic penetration remains really low.

In fact, when we look at psoriasis, we're talking about -- about 15% of biologic penetration. And if we think about Cosentyx, we know that there are a lot of competitors out there, but we've shown efficacy across four indications. In psoriasis, our data shows that we clear skin in eight out of 10 patients and that we have strong efficacy across the actual spectrum. Remember that two-thirds of patients are going to have some of these manifestations.

One other point I wanted to make is that we have five-year-plus safety data and the bar is very high right now on safety, especially now. So what Cosentyx offers is a tried and trusted complete treatment. In addition to that, we have strong access, not only in the U.S. but across the globe.

And so, you know, I keep talking about our three pillars in our strategy and it's exactly that. It's strong access, early line access that's going to allow us to -- to grow volume and revenue in the U.S. and in the EU. We've got the geographic expansion in China with the NRDL that just came in March.

So you'll see more of that in the rest of the year. Then we've got our complete profile and we continue to have strong resonance in the marketplace with the data that we have. And of course, in the future, our lifecycle management programs. So we've shown that we can do well despite multiple competitive entries in the psoriasis space and beyond the psoriasis space, and we're confident we can deliver double-digit growth in the year.

Vas Narasimhan -- Chief Executive Officer

Thank you, Marie-France. 

Marie-France Tschudin -- President of Novartis Pharmaceuticals

Can I take your question on Cigna? 

Vas Narasimhan -- Chief Executive Officer

Yes. 

Marie-France Tschudin -- President of Novartis Pharmaceuticals

So the next question was on Cigna. Yeah. Yeah. So I -- I think that's a question for Cigna.

But what I'll say is that we're not going to change our commitment to physicians and patients. We believe that access should enable a clinical decision between a physician and a patient. And that's why broad access is going to stay a core pillar of our strategy. But we'll always balance that with the long-term value of the brand.

We -- we -- we have six potential upcoming indications. So it's our obligation to think about what drives value today but also what drives value in our future. 

Simon Baker -- Redburn -- Analyst

OK. Thanks so much. 

Vas Narasimhan -- Chief Executive Officer

Next question, operator.

Operator

Thank you. Your next question comes from the line of Wimal Kapadia from Bernstein.

Wimal Kapadia -- Sanford C. Bernstein -- Analyst

Great. Thank you very much for taking my questions. Wimal Kapadia from Bernstein. To kindly first ask about the PSMA-617 and the VISION -- VISION study following the positive headlines in March.

Just given the continued changing in the standard of care in prostate cancer, I just wanted to get your thoughts on the trial design and the implications for commercial potential. Should the real comparator for VISION have been cabin -- Cabazitaxel in order to be of real clinical importance rather than the best standard of care given, you know, the likes of Zytiga and Xtandi are no longer recommended in that setting? So I appreciate it's quite a fluid situation when it makes -- when it comes to trial design. But just your thoughts on commercial impact would be great. And then my second question is just on Ligelizumab and the upcoming phase 3 read-out in CSU.

Just curious on your thoughts on your level of confidence for that read-out later this year. How quickly could we actually see switching from Xolair should we see positive data? And can you just provide some context on what proportion of Xolair sales come from CSU today? Thank you.

Vas Narasimhan -- Chief Executive Officer

Yeah. Thanks, Wimal. And thanks also for your initiation of coverage and your very comprehensive report a few weeks back. So first on -- on PSMA-617, I'll -- I'll move it to  Susanne on the commercial potential in the trial design. 

Susanne Schaffert -- President of Novartis Oncology

Yeah, thanks a lot. So maybe let me start with the trial design. So, you know, just to remind you what the setting was for the VISION trial. So it was in -- in progressive metastatic castration-resistant prostate cancer with at least one line of prior androgen therapy and at least one but not more than two lines of taxane-based chemotherapy.

And resulted that in this setting, standard of care is the best comparator. It's really a setting where there is limited options and this setting of very high unmet medical need. So we believe it is very strong data and I think the fact that we were really showing positive data on both radiographic PFS and OS, I think is demonstrating that. And as I said, the commercial potential in this area is still significant as prostate cancer is the second largest cancer indication.

This set in, of course, is in late lines, but we still believe there's very high medical need and -- and Lutetium-PSMA will -- will offer a very, very attractive, you know, treatment option. And then you just look into this setting, think again that the majority of these patients will be metastatic, have a very low survival -- five-year survival rate. So, therefore, it is a significant pool of patients. 

Vas Narasimhan -- Chief Executive Officer

Maybe I'll just add, we -- as we noted in -- in the presentation, we've already initiated or will soon initiate a range of earlier-stage prostate cancer studies which will enable us, if successful, to rapidly broaden the indication base for PSMA-617. So on -- on Ligelizumab on the clinical program and our confidence, maybe John and then maybe Marie-France on the contribution of CSU and the ability to switch from Xolair. So, John? 

John Tsai -- Head of Global Drug Development and Chief Medical Officer

Sure. Yeah, thanks. Thanks for the question. As you know, we moved into the phase 3 program based on the phase 2 head-to-head study that we had against Xolair which was published in The New England Journal.

Based on that phase 2 study, what we saw was 42% symptom-free with Ligelizumab versus 26% in omalizumab, which was a significant difference. And scientifically, as we think about that, Ligelizumab recognizes a different [Inaudible] on the IgE molecule for Xolair and that's the confidence that we have. And they more specifically binds on the Fc epsilon RI effector cells. And based on this fact, we've moved into the two Pearl -- two studies, Pearl 1 and Pearl 2.

But we expect to get those readouts by the end of the year and the early part of next year as we continue recu -- accrue the -- the endpoints. On the population and opportunity, I'll turn it to--

Vas Narasimhan -- Chief Executive Officer

Yeah, we can go to Marie-France. Marie-France?

Marie-France Tschudin -- President of Novartis Pharmaceuticals

Yeah. So -- so the first thing to point out is that the biologic penetration in this market space is -- is also really low. We -- we currently estimate that less than 30% of patients are -- are on Xolair, and that's probably optimistic. And -- and what we know is that we've got about 1.3 million CSU patients in the top 11 countries that are still not adequately controlled.

So this is a big opportunity. This product is showing to differentiate itself significantly and an opportunity for us to bring this product to a much broader population, which right now is really underserved with antihistamines. 

Vas Narasimhan -- Chief Executive Officer

Terrific. Thanks, Marie-France. So for the remaining questions -- 

Wimal Kapadia -- Sanford C. Bernstein -- Analyst

Thanks so much.

Vas Narasimhan -- Chief Executive Officer

Thank you, Wimal. If -- if we could limit yourself to one -- one -- one question, that would be great as we have a number of people in the queue. So next question, operator. 

Operator

Thank you. Your next question comes the line of Florent Cespedes from Societe Generale.

Florent Cespedes -- Societe Generale -- Analyst

Good afternoon, everyone. Thank you so much for taking my question. For Susanne on Kisqali. Susanne, how would you explain the difference on the dynamic of the U.S.

versus Europe markets and why Europe is much more dynamic than -- than the U.S.? And how do you see the -- the U.S. market breast cancer market dynamic going forward? Thank you. 

Vas Narasimhan -- Chief Executive Officer

Susanne?

Susanne Schaffert -- President of Novartis Oncology

Yeah. Thank you, Florent. So, you know, as I said, Kisqali globally was growing 19%. And as you rightly point out, there was very strong growth ex-U.S., especially in the EU while we say it's more or less flattish or slightly declining in the U.S.

And I think the reason is really very different market dynamics, that in the U.S., the market certainly is already quite penetrated with CDK 4/6 inhibitors. And when you look at the impact of COVID, you saw that NBRx, for example, in February was down 16%. And this has continued now since the pandemic has started. And this is now already impacting TRx going down minus 4%.

So, of course, our growth would come from new patients and that's hard to get if -- if less new patients coming in. While in Europe, overall penetration of CDK 4/6 is much lower. So the dynamics there are -- are more active, and therefore, we could capture more patients there. So overall, as I said, Kisqali with the strong OS data, we feel is very well-differentiated.

We keep on focusing, executing our gross brands, and we remain confident also for the U.S. that when patients will come back and -- and things will open up more that we capture again strong growth.

Vas Narasimhan -- Chief Executive Officer

Thank you, Susanne and Florent. Next question, operator. 

Operator

Thank you. Your next question comes from the line of Richard Vosser from J.P. Morgan.

Richard Vosser -- J.P. Morgan Securities

Hi. Thanks for taking my question. Just a question on the ophtha brands' erosion and just when we should think about that -- that [Inaudible] out and the -- and the growth of the ophthalmology franchise going forward? Thanks very much.

Vas Narasimhan -- Chief Executive Officer

Thank you, Richard. So on ophthalmology dynamics, Marie-France? I guess also referring to front of the eye as well. I know Xiidra -- strong Xiidra performance as well really on the quarter.

Marie-France Tschudin -- President of Novartis Pharmaceuticals

Right. I was -- I was going to mention that. So -- so we do -- we -- we do see -- obviously, we've seen a huge impact in -- in -- in this space because of COVID. So there -- there is a combination of factors.

So we have seen some loss of exclusivity, which is obviously something that we anticipated over our strike-plan period. And then, of course, there was a COVID impact, which really hit the entire offset portfolio, as you know, starting with the Anti-VEGFs, which nicely recuperated during the year and you see them off to -- to a solid performance across the board in -- in 2021. We still see a -- a suppression in the marketplace, although that's starting to pick up. And what I will point out is our -- our front of the eye portfolio, or namely in Xiidra, we -- we do see very encouraging data.

And then we had to relaunch that brand as you know. But we also know it's a big market, right, 32 million people with dry eye disease and -- and only 1.6 million of them are in a prescription drug. So we -- we had a good quarter with Xiidra, 28% of NBRx share. And it just shows that if -- if you -- if you have the share of voice, if you have the right campaign, then it's worth investing in this space. 

Vas Narasimhan -- Chief Executive Officer

Terrific. Thank you, Marie-France and Richard. Next question, operator. 

Operator

Thank you. The next question comes the line of Tim Anderson from Wolfe Research.

Unknown speaker -- Wolfe Research -- Analyst

Yes, hello. Thank you for taking the question. This is Richard Wagner on -- on behalf of Tim at Wolfe Research. The question on Kisqali.

Could you speak about what you're seeing in the U.S. in terms of rebating in this oral oncologic category? Our understanding is that the rebates are stepping up. Presumably, that is driven by Pfizer trying to hang on to the market share. What's the outlook for the net price trends in this category and where -- how would those trends in particular impact Kisqali, which does not have the volume of Ibrance and does not yet have the absolute data? Thank you very much.

Vas Narasimhan -- Chief Executive Officer

Thanks, Richard. So, Susanne, on Kisqali, our CDK 4/6 rebating trends.

Susanne Schaffert -- President of Novartis Oncology

Yeah, sure. So -- so, you know, I wouldn't want to comment on that. I've -- maybe let me just reemphasize what is our strategy. Certainly, we see that Kisqali has the best OS data and also has demonstrated now longest OS, combining all the -- the phase 3 trials.

And that keeps us confident that if the focus, continued on execution, we will also see continued momentum. We -- we get very positive feedback from HCPs and we see that they are changing now their treatment patterns, that more and more are willing to list Kisqali. So I believe our focus needs to be on differentiation, on continued execution of our gross brands. And therefore, I still believe Kisqali is a important growth driver for us and I remain very confident in the brand. 

Vas Narasimhan -- Chief Executive Officer

Thank you, Susanne. Next question, operator. We have a few more left.

Operator

Thank you. Your next question comes from the line of Mike Nedelcovych from Cowen. 

Mike Nedelcovych -- Cowen Inc. -- Analyst

Hi. Thanks for taking the question. I'm curious on Entresto. It looks like the data in the post-AMI setting trended toward improvement despite missing the primary endpoint.

But the readout is listed as neutral on the slide. So I'm just wondering, should we take that to mean that filing in that indication might still be on the table? Thanks.

Vas Narasimhan -- Chief Executive Officer

Yeah. I'll just quickly take that. you know, we need to discuss with the -- the regulatory authorities, and we'll present the full data in -- in ATC where you can see both the primary and -- and secondary endpoint. So then the question on the table, of course, is we demonstrated a positive trend versus an established standard of care in ramipril.

But it was a superiority study, so I think we'll need to work through with the regulators what's possible in terms of any sort of indication in the label or any data in the label. But we'll -- we'll take those steps, and we'll present the data at ATC. Next question, operator. 

Operator

Thank you. And the final question comes from the line of Peter Welford from Jefferies.

Peter Welford -- Jefferies & Company -- Analyst

Hi. Thanks for squeezing me in. A quick question on Sandoz again. I'm wondering if it's possible of you to quantify the impact of the determination of your Solids partnerships, which I guess somewhat of a one-off.

And just thinking about then, the Sandoz business and getting it back to growth and margins, how should we think about potential for disposing of parts of that business or slimming the portfolio down? I know you've tried this before. But, clearly, to a certain growth in margins, you know, the other ways to slim down the sales line, is that even viable with the business portfolio that you have? Thank you.

Vas Narasimhan -- Chief Executive Officer

Thanks, Peter. Good to hear from you, and Richard Saynor on the Sandoz U.S. business and legacy -- well, the --the oral solids and dermatology business.

Richard Saynor -- Chief Executive Officer of Sandoz

Yeah. Thank you. Thank you, Peter. So yeah, you're right.

I mean clearly, we've terminated or ended a number of the partnership relationships and that's really washing through from the end of last year really pretty much to the end of this year. So a lot of the decline that you see in the oral solids business is really related to that. But it's our hope that that will wash out by the end of this year. And then really, I see the U.S.

business in sort of three distinct chunks. You have the core business, the injectables, the biologics, and the ophtha business, which really has a strong momentum and potential for growth as -- as we launch new products going into the end of '22 and '23. We're currently looking at how we strengthen and stabilize the Oral Solid business once that wash-out phase has cleared with both in-house developments and rebuilding that capability, and then looking at also BD and M&A to strengthen it. And then the derma piece, already we've -- we've cleaned up a lot of the derma business.

We -- we divested some of those elements over the last month. And the remaining is relatively stable and accretive to the overall business. So a lot of moving pieces, but we've got a clear plan going forward.

Vas Narasimhan -- Chief Executive Officer

Terrific. Thanks. Thanks, Richard, and thanks, everyone, for your -- your questions today. Maybe just to take a step back.

I think it's -- it's worth -- worth noting, when you look at the longer-term growth profile of the company, our key, again, drivers, Cosentyx, Entresto, Zolgensma, Kesimpta are all demonstrating. They have the outlook and the potential to really enable us to grow consistently through 2025 as -- as Harry outlined. On top of that, we continue to expect to be able to bring in inclisiran to broad groups of patients in the U.K. and the U.S.

well ahead of the outcome study, giving inclisiran significant potential even ahead of the outcomes data which we now expect in '26. With the Kisqali adjuvant and our continued efforts in Beovu, you have a broad range of products in hand to drive that growth for the next few years. Then on top of that, you have a deep mid-stage pipeline where we continue to show progress, multiple assets that could be multi-billion-dollar potential assets to drive our longer-term growth. You see already the first possibilities with Lu-PSMA and we hope to demonstrate with further readouts over the course of this year the potential of that pipeline.

Continued margin progression and -- and aspiration and demonstration of leadership in ESG. So I think the -- the story is taking shape and we look forward to continuing to attract long-term investors to our company, to our stock, and our overall vision to reimagine medicine. So thank you all very much for joining the call and we'll look forward to speaking again soon.

Operator

[Operator signoff]

Duration: 91 minutes

Call participants:

Samir Shah -- Global Head of Investor Relations

Vas Narasimhan -- Chief Executive Officer

Marie-France Tschudin -- President of Novartis Pharmaceuticals

Susanne Schaffert -- President of Novartis Oncology

Harry Kirsch -- Chief Financial Officer

Mark Purcell -- Morgan Stanley -- Analyst

John Tsai -- Head of Global Drug Development and Chief Medical Officer

Graham Parry -- Bank of America Merrill Lynch -- Analyst

Richard Saynor -- Chief Executive Officer of Sandoz

Andrew Baum -- Citi -- Analyst

Keyur Parekh -- Goldman Sachs -- Analyst

Emmanuel Papadakis -- Deutsche Bank -- Analyst

Matthew Weston -- Credit Suisse -- Analyst

Richard Parkes -- Exane BNP -- Analyst

Laura Sutcliffe -- UBS -- Analyst

Simon Baker -- Redburn -- Analyst

Wimal Kapadia -- Sanford C. Bernstein -- Analyst

Florent Cespedes -- Societe Generale -- Analyst

Richard Vosser -- J.P. Morgan Securities

Unknown speaker -- Wolfe Research -- Analyst

Mike Nedelcovych -- Cowen Inc. -- Analyst

Peter Welford -- Jefferies & Company -- Analyst

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