Lars Rebien Sørensen - Chief Executive Officer, President and Member of the Senior Management Board Mads Krogsgaard Thomsen - Chief Science Officer, Executive Vice President and Member of the Senior Management Board Jesper Brandgaard - Chief Financial Officer, Executive Vice President, Member of the Senior Management Board, Chairman of Novo Nordisk Engineering A/S and Chairman of Novo Nordisk IT A/S

Sachin Jain - BofA Merrill Lynch, Research Division Richard Vosser - JP Morgan Chase & Co, Research Division Michael Novod - Nordea Markets, Research Division Peter Verdult - Morgan Stanley, Research Division Keyur Parekh - Goldman Sachs Group Inc., Research Division Jo Walton - Crédit Suisse AG, Research Division Martin Parkhøi - Danske Markets Equities, Research Division Brian Bourdot - Barclays Capital, Research Division

Good day, ladies and gentlemen, and welcome to the Q2 2012 Novo Nordisk A/S Earnings Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Jesper Brandgaard. Please go ahead, sir. Lars Rebien Sørensen: Thank you. I have to apologize. This is Lars Rebien Sørensen, the CEO of Novo Nordisk. With us, we have our Chief Financial Officer, Jesper Brandgaard; Mads Krogsgaard Thomsen, our Chief Science Officer; and also present are our Investor Relations officers. Today's earnings release and the slides for this call are available on our homepage, novonordisk.com. The conference call is scheduled to last approximately 1 hour. And as usual, we'll start with an outline of the conference call on Slide #2. The Q&A session is expected to begin in about 25 minutes. Turn to Slide #3. As always, I need to advise you that this call will contain forward-looking statements. Such forward-looking statements are subject to risks and uncertainties that could cause the actual results to differ materially from expectations. For further information on the risk factors, please see the earnings release and the slides prepared for this presentation. Please note that the conference call is being webcast live and a replay will be made available on Novo Nordisk's website after the call. Turn to Slide #4. We're very satisfied with the performance of the first 6 months of 2012. Sales increased 12% in local currencies compared to the same period in 2011. The sales growth has predominantly been driven by strong performance in North America and International Operations. Key sales drivers have been Victoza and our modern insulins, in particular, NovoRapid and Levemir. The regulatory review of Tresiba and Ryzodeg progressed in all major markets. In the United States, the FDA has tentatively scheduled an advisory committee meeting on November 8 this year. Now we also completed the first Phase IIIa trial for IDegLira, the fixed ratio combination of Tresiba and Victoza. The trial results demonstrate superior glucose control in the IDegLira-treated patients, while reconfirmed the competitive profiles of both Tresiba and Victoza. Mads will elaborate more on this more during his R&D update. In the very recent completed pivotal trial for vatreptacog alfa, one patient has developed antidrug antibodies with potentially neutralizing effect. The impact of this finding on the project is currently being evaluated. Turning to financials. Reported operating profit grew 31% and diluted earnings per share grew 26% in the first 6 months of this year. Reflecting the strong sales performance of the first 6 months, we've increased our expectations for sales growth for the full year to the range of 9% to 12% in local currencies compared to a growth expectation of 8% to 11% when we released the first quarter report of this year. The expectations for operating profit growth is now around 15% measured in local currencies, in line with the ambition level outlined in our long-term financial targets. Turn to Slide #5. In the first 6 months of this year, North America accounted for 64% of the growth, followed by International Operations accounting for 21% of growth, both measured in local currencies. Sales growth in North America was 19% in local currencies reflecting a continued solid market penetration of modern insulins, in particular, NovoLog and Levemir, and the continued solid performance of Victoza despite the launch of a competitive product. The sales growth in the first 6 months in Europe was 2% measured both in local and reported local currencies. The sales development reflect the continued solid performance of Victoza, progress for the portfolio of modern insulins. Sales growth remains negatively impacted by a decline in sales of human insulin and low insulin volume growth and healthcare reforms. Sales within International Operations grew 17% in local currencies in the first 6 months, driven by continued penetration of all 3 modern insulins, solid human insulin sales and continued expansion of the GLP-1 market within International Operations where Victoza holds the market leadership position with 79% of the market. Sales in Region China increased 13% in local currencies in the first 6 months. The growth was driven by the entire modern insulin portfolio, while sales of human insulin only grew modestly. Sales in Japan & Korea were unchanged in local currencies when compared to the first 6 months of 2011. Sales development reflects the negative impact from lack of insulin volume growth and continued challenging competitive environment. Turn to Slide #6. The modern insulins continue to exhibit double-digit growth rates and Victoza continues its steady growth trajectory. The first 6 months of diabetes care franchise grew 15%, while the biopharmaceutical franchise grew 1%, both measured in local currencies. Modern insulins are the primary growth drivers, accounting for 54% of growth; followed by Victoza, accounting for 46% of growth in local currencies. Sales of NovoSeven was unchanged compared to the same period last year when measured in local currencies. The market for NovoSeven remains negatively impacted by stricter budgetary controls and an increase in inhibitor patients participating in clinical trials. In local currencies, the sales of NovoSeven reflects a rebound in the second quarter of this year, following the modest sales in the first quarter of this year. The rebound is mainly driven by a number of patients with major bleeding episodes in the United States, which is partly countered by a negative impact from timing of tenders in International Operations. Sales of Norditropin increased 9% in local currencies. The sales growth is mainly driven by International Operations and North America. Novo Nordisk [ph] remained the second-largest company in the global growth hormone market, with a volume market share of 24% when measured by IMS. Turning to the next slide. As highlighted at the conference call for the first 3 months of 2012, our insulin sales growth rate has started to rebound. Throughout 2011, insulin sales growth rates were significantly impacted by healthcare reforms across most major markets, including the United States, Europe, China, as well as competitive pressures in North America, Europe and Japan. In the second quarter, we are happy to report that the rebound of our insulin sales growth is sustained at a double-digit level. Turning to an update on Victoza. Sales of Victoza reached DKK 4.3 billion in the first 6 months of this year. The performance reflects steady sales performance across all regions. Victoza continues to exhibit solid sales growth rate, with an average quarterly increase of approximately DKK 200 million per quarter. In the United States, Victoza sales continue to be encouraging despite the launch of a competitive product. Victoza is slowly increasing its market share, and now accounts for more than 57% of the total GLP-1 prescriptions in the U.S. Victoza's capture rate of new GLP-1 patients are also slowly increasing, with Victoza now capturing close to 55% of all new GLP-1 patients. In Europe, we continue to see strong uptake of Victoza across all key markets, and Victoza remains the leading GLP-1 product in Europe, with a market share of 73%. With this, I'd like to hand over to Mads who'll give you an update on research and development.

Thank you, Lars. Please turn to the next slide. Let me start with a brief update on Tresiba and Ryzodeg. The regulatory reviews are progressing in all major markets. In the U.S., the FDA has now scheduled an advisory committee meeting covering both products on 8th of November. We hope to be able to provide an update regarding the focus of AdCom meeting as part of our third quarter announcement. The Japanese and European regulatory reviews for Tresiba and Ryzodeg are progressing well, implying that regulatory action during the second half of this year is likely in these regions. Please turn to the next slide for an update on IDegLira. IDegLira, the combination product between Tresiba and Victoza has completed the first trial in Phase III development called the DUAL program. This is, by far, the largest Phase III trial, is the DUAL I that encompass more than 1,600 subjects with type 2 diabetes, inadequately controlled on metformin plus/minus Pioglitazone at screening. These patients were randomized 2:1:1 to 26 weeks of once-daily treatment with either IDegLira, Tresiba or Victoza, all in a prefilled pen injector. From a mean HbA1c of 8.3% at baseline in all groups, patients randomized to the Tresiba and Victoza control arms are seeing excellent glucose control with an end HbA1c that reached the 7% ADA target for glycated hemoglobin, while patients randomized to IDegLira experienced a statistically significantly greater A1c reduction, down to 6.4%. Consistent with the 6.4% A1c achievement, an extremely high proportion of IDegLira patients, 70%, reached the AACE glycemic target of an A1c below 6.5%, substantially higher than in the control arms. Despite the low hypoglycemia rate being observed in patients treated with Tresiba, the IDegLira group experienced an even lower rate of confirmed hypoglycemia than what's statistically significant versus Tresiba. While it is inherently difficult to ascribe a specific impact on glucose control to each of the components in the fixed combination product, we can, based on statistical analysis, state the following: degludec and liraglutide each contributed to the consistent and dramatic lowering of fasting [ph] glucose, while liraglutide was responsible for the significant improvement in meal-related glucose elevations over all 3 meals. In fact, the overall profile of glucose over 24 hours in the IDegLira group approached that of an individual without diabetes. Due to the combined effect of both degludec and liraglutide, the mean end-of-trial insulin dose among IDegLira patients was significantly lower than those receiving Tresiba alone, while the mean liraglutide dose was within the approved dose range for Victoza. An additional beneficial finding was the patients treated with IDegLira experienced an average weight loss of around 0.5 kilogram compared to weight increase of around 1.5 kilograms in the Tresiba arm, while those in Victoza alone lost 3 kilos, consistent with the weight loss found in multiple other Victoza studies. Finally, Tresiba and Victoza both confirmed that previous safety and tolerability profiles, and the IDegLira combination product likewise demonstrated an encouraging safety profile, with the most frequent side effect, nausea, occurring in less than 10% of the patients. Overall, the data from DUAL I reconfirmed the competitive profiles of Tresiba and Victoza, and the trial clearly demonstrates how the advantages of both of these products have been combined in a product that offers the best of basal insulin and GLP-1 therapies in 1 convenient injection. The second Phase IIIa trial, DUAL II, is expected to complete towards the end of this year, followed by a combination of regulatory dossiers in the first half of next year. Please turn to the next slide for an update on the once-weekly human GLP-1 analogue, Semaglutide. In June, Novo Nordisk announced the decision to initiate the global Phase III development program, called SUSTAIN, for semaglutide, with the first study expected to start in the first half of next year. The Phase IIIa program for semaglutide will include more than 8,000 people with diabetes, type 2 diabetes. At this year's EASD conference in Berlin during the first week of October, there will be an oral presentation of the Phase II data for semaglutide. The data from the study, highlighted on this slide, is already available in abstract form online at EASD's website. Thus, the 12-week type 2 diabetes trial shows that semaglutide dose dependently reduce both hemoglobin A1c and weight, with a very high efficacy level for both glucose and weight lowering after weekly administration of the prefilled pen injector. Further details of this study will, as mentioned, be presented at the EASD conference. Please turn to the next slide. Novo Nordisk has now initiated the first Phase I study for a novel oral basal insulin analogue OI362GT, in approximately 100 healthy subjects. Trial completion is expected in the first half of 2013. In May, the FDA approved Levemir for use in children aged 2 to 5. With this label extension, which is already approved in Europe, Levemir is now the basal insulin analogue, with a label that covers the broad spectrum of patient symptoms in both Europe and U.S. NovoMet has now been approved in China. NovoMet is a fixed combination of metformin and repaglinide. The product is marketed as PrandiMet in the U.S. Launch in China is expected towards the end of 2013. In June, Novo Nordisk launched NovoPen 5, a new durable insulin pen, in the first country, Denmark. NovoPen 5 is based on the world-proven NovoPen 4 platform, with the addition of an integrated memory function that displays information related to the last dose administered. Moving on to biopharmaceuticals. Last month, the Canadian agency, Health Canada, was the first to approve Novo Nordisk new recombinant factor XIII product. The product was approved for once-monthly prophylactic treatment of congenital factor XIII A-subunit deficiency and will be the only recombinant treatment option for this rare disease that affects approximately 900 people worldwide. Launch is expected in the second half of this year under the brand name Tretten. In Europe, the adoption by the European Commission of the previously announced positive CHMP opinion is now expected next month, i.e. September. Novo Nordisk recently completed the pivotal Phase III trial for vatreptacog alfa, a fast-acting recombinant coagulation factor VIIa analogue, in adult hemophilia patients with inhibitors. In the pivotal trial, antidrug antibodies have been observed in a few patients. And in one of these, a potentially neutralizing effect has now been observed in one sample. The impact of this unfortunate finding on the project is being evaluated as part of the Phase III program completion. Final results of the blinded drug randomized trial that is encompassing 72 patients with a total of 568 treated bleeding episodes, are expected in October. In the inflammation area, Novo Nordisk has now initiated the first Phase IIb clinical trial with Anti-IL-20, a fully human monoclonal antibody in patients with active rheumatoid arthritis. The trial will investigate the effects of different doses of Anti-IL-20 compared to placebo, when administered as weekly subcutaneous injections in patients on a stable background of methotrexate therapy who are inadequate responders to anti-TNFa biologics. Lastly, Novo Nordisk has initiated the first Phase I trial for Anti-C5aR-215, a recombinant human monoclonal antibody. The aim of this trial is to describe the safety and tolerability of single IV and subcut [subcutaneous] doses of Anti-C5aR-215 in patients with active rheumatoid arthritis on a background of methotrexate treatment. The trial will enroll 36 subjects with active rheumatoid arthritis and is expected to be completed by mid-'13. With that, over to Jesper for an update on the financials.

Thank you, Mads. Please turn to the next slide. In the first 6 months of 2012, sales increased by 17% measured in Danish kroner to DKK 37.2 billion, and by 12% in local currencies. The reported gross margin improved by 130 basis points to 81.7% in the first 6 months of 2012. The improved margin is mainly due to the favorable price environment in North America, a positive impact from product mix due to increased sales of modern insulins and Victoza, supported by a 50-basis-point impact from the positive foreign exchange environment. Total non-production-related costs increased by 7% in local currencies and by 11% in Danish kroner to DKK 16.7 billion. Sales and distribution costs increased by 13% in Danish kroner and by 8% in local currencies. The growth in local currencies is primarily driven by increased marketing cost in the U.S., sales and marketing investments in selected countries in the region International Operations, as well as the sales force expansion in China mid-2011. Research and development costs increased by 10% to DKK 5.1 billion and by 8% in local currencies, mainly driven by the development cost related to the ongoing Phase III trial for the liraglutide in obesity and the Phase III trials for IDegLira. For biopharma, costs are primarily related to the continued progress of the portfolio of development projects within hemophilia and the Phase II trial for Anti-IL-20 in rheumatoid arthritis. Operating profit increased by 31% in the first 6 months to DKK 14 billion, in local currencies, the growth of almost 21%. Net financials showed a net expense of DKK 1,038,000,000 in the first 6 months compared to a net expense of DKK 25 million in the first 6 months of 2011. In line with Novo Nordisk's treasury policy, the most significant foreign exchange risk for the group has been hedged, primarily through forward currency contracts. Reflecting the portfolio of foreign currency exchange hedging contracts, the foreign exchange result was an expense of DKK 963 million compared to an income of DKK 32 million in 2011. This development reflects losses on foreign exchange hedging involving especially in the U.S. dollar and Japanese yen due to the their significant appreciation versus the Danish kroner compared to the exchange level prevailing in 2011. The effective tax rate for the first 6 months of 2012 was 23%. Please turn to the next slide. The 2 graphs illustrate the development of the U.S. dollar and the Japanese yen versus the Danish kroner. The tables on the right show the updated annual impact on operating profit of a 5% movement in each of our key invoicing currencies and the current extent of hedging for the same currencies. During the first 6 months of 2012, the average exchange rate for the U.S. dollar versus the Danish kroner was approximately 8% above that we saw in the first 6 months of 2011. At present, the value of the U.S. dollar is approximately 12% above the average level of 2011. Please turn to the next slide. Novo Nordisk now expects growth in 2012 of 9% to 12% measured in local currencies. This is based on expectation of continued market penetration of Novo Nordisk's key products, as well as expectations for continued intense competition, generic competition to oral anti-diabetic products and impact from the implementation of health care reforms, primarily in the U.S., Europe and China. Given the current level of exchange rate versus Danish kroner, the reported sales growth is now expected to be around 7 percentage points higher than the growth measured in local currencies. For 2012, operating profit growth is now expected to be around 15% measured in local currencies. This reflects a significant increase in costs in the second half of 2012, driven by the expansion of the U.S. sales force, which is ongoing, launch preparations for Tresiba, as well as sales and marketing investments in China and a selected number of countries in International Operations. The expectation for a higher level of operating profit growth reflects the increased expectations for sales growth and the deferral of the planned significant cost related to the U.S. launch of Tresiba, which will now be moved to 2013, whereas we previously expected them to be incurred in 2012. Given the current level of exchange rates versus Danish kroner, the reported operating profit growth is now expected to be around 12 percentage points higher than the growth measured in local currencies. For 2012, Novo Nordisk now expects a net financial expense of around DKK 1,950,000,000, reflecting a net loss on the foreign exchange hedging contract following the appreciation of the U.S. dollar and Japanese yen versus Danish kroner compared to the exchange rates prevailing in 2011. I do note that the expectation to losses related to currency hedging contracts is more than offset by the expected significant positive impact on reported operating profit from the appreciation of invoicing currencies versus Danish kroner. The effective tax rate for 2012 is still expected to be around 23%. Capital expenditures is still expected to be around DKK 3.5 billion in 2012, primarily related to investments in filling capacity and the device -- sorry, a prefilled device production facility in Denmark. Expectations for depreciation, amortization and impairment losses are still around DKK 2.9 billion and free cash flow is now expected to be around DKK 19 billion, reflecting the increased expectations to operating profit growth. All of the above expectations are based on the assumption that the global economic environment will not significantly change business conditions for Novo Nordisk during the remaining part of 2012 and the currency exchange rate, especially the U.S. dollar, will remain at the current level versus the Danish kroner during the remaining part of 2012. This concludes the financial updates. Now back to you, Lars. Lars Rebien Sørensen: Thank you, both to Jesper and Mads. And now we are ready to move to the Q&A part. Operator, we are now ready to take the first question, please.

[Operator Instructions] Our first question comes from Sachin Jain of Merrill Lynch. Sachin Jain - BofA Merrill Lynch, Research Division: Sachin Jain from Merrill Lynch. A couple of questions, please. First on degludec and the regulatory discussions. Just broad question, any issues being discussed with the FDA that are not commonly being discussed in the investment community? So anything outside of open label, launch's timing, strength of hyphal data, flexible dosing that we should be aware of. Background to the question is just with Victoza, obviously, the thyroid issues came up quite late. So is there anything similar happening there? And then related, I think you commented that you'll have further color of the third quarter results. Just what will you have by then that you don't have now from your perspective? And then secondly, as we think about a potential degludec label in the U.S. and what you may be able to promote, I wonder if you could describe how you were able to market, especially superior hypoglycemia profile for Levemir versus human insulin with -- while the label for Levemir doesn't have that data explicitly claimed? Lars Rebien Sørensen: Thank you very much, Sachin. This is Lars Rebien here. Mads Krogsgaard, I believe, you are on for the first couple of questions here. Degludec, any color that you want to give on the discussion we've already had with the FDA and what news you anticipate that we might have which we can share with the community in the Q3 release that we'll have at the 31st of February -- no, October, sorry.

Yes, well, first of all, Sachin, we are not -- have not been informed by the agency what the specific focus of the outcome will be at this point. And of course, we are hoping by end of Q3, i.e. the company announcement in late October that we will be able to put more color on that, because we will know more at that point. In terms of the scope and focus, what I can tell you is that in the case of liraglutide, we have the preclinical findings, by the way, that are shared by all GOP -- [indiscernible], i.e. the seesaw [ph] findings that occur in rats, mice, but not in monkeys and humans, and those were clearly there. And as you recall, they were heavily debated during that second day of the meeting. In the case of degludec, we do not have any preclinical findings suggestive of such, you can say, a surprise. But we'll get back to you hopefully over the next quarter on that one. I think the other one was about Levemir, where we have got a new label, by the way, recently in the U.S. What I can tell you tell you, Sachin, is that you can actually promote certain data that are not found directly in your label for a product if that data is, a, consistent with the label and if the data are sufficient to meet the agency's, what we call, evidentiary standard for those particular claims. This is also reflected by such material having to be approved by the FDA's Office for Prescription Drug Promotion, known as the OPDP and formerly known as DDMAC. Sachin Jain - BofA Merrill Lynch, Research Division: Just one quick follow on, so really, you don't know what the outcome may be related to, based on the discussions to date. Is there anything outside of what's been discussed in your investment community being discussed with yourself and the regulators? Lars Rebien Sørensen: I think my understanding is that the investment community is discussing just about everything. So I'll have to investigate further, Sachin, and read all the reports.

Our next question comes from Richard Vosser of JPMorgan. Richard Vosser - JP Morgan Chase & Co, Research Division: Richard Vosser from JPMorgan. A couple of questions, please. First question just on the figures, and whether you've seen any receivables coming back from Southern Europe, whether you've been paid for those. We've seen that with a number of companies this quarter. And linked to that, whether you could let us know whether any of these debts have been previously written off, so there could have been a positive impact on sales this quarter. Second question along those lines is just whether you see any future impacts from healthcare reforms in H2. Clearly, the insulin growth rates are looking very good, but whether we would see any further reforms coming. We've heard from some companies about potential price cuts in Italy, just your perspective there would be great. And then finally, on the combo, you mentioned that a significant improvement in the mealtime glucose overall meals, just wondering whether you could give us an idea of what the differential effects on each of the meals would have been. Was there an effect that was higher, the first meal after dosing, or was it relatively stable across all meals? And finally, whether all the products were dosed at the same time in the trial, that would be great. Lars Rebien Sørensen: Thank you very much, Richard. The first 2 questions I'd like to defer to Jesper, dealing with receivables coming out of Southern Europe and to what extent that has included debt, which is already been written off, and has been a positive once off, as you indicate. And then also, what our current assessment, which goes into the guidance on further healthcare reforms are included. Jesper?

In terms of receivables in Southern Europe, the way that we actually record the provisions show that when we make provisions for our receivables, they would actually be included in the selling and distribution line. So if it's a selling and distribution cost, the sales would have been recorded. So there's no effect on the sales from changing the provision levels for Southern European debt, and if we look at the sales and distribution cost line for the second quarter, and also if we look at it for the first half year, there is no significant impact from changes in provisioning levels occurring as for the first 6 months of the year. But changes in provision levels would typically go through as a reversal on the selling and distribution line. But that is not the effect -- that's not the case for the first 6 months. And again, we do make ongoing provisions for the sales we are having if they become more than 90 days overdue, and we're seeing -- still seeing slow payments from the public part of the system, whereas the traditional distribution system for our insulin that flow through the pharmacies, we are seeing a continued payment scheme and no significant change in our days of sales outstanding in Southern Europe. So I'd say no specific concern there. In terms of the expectations we have given for local currencies sales growth of 9% to 12%, that includes a continuation of expected healthcare reforms in Europe. It is not so that we are hitting any individual or in any -- in all countries in one go. It will be country by country. Currently, we are feeling impact from, especially, a reform in Poland. Overall, I would estimate the annual effect in Europe -- on European sales to be in the magnitude of, let's say, 3% to 4% of European sales. And that will be equivalent to close to 1% of global sales. And that is the going rate that we have assumed for the full year. Lars Rebien Sørensen: Thank you very much, Jesper. And then on to Mads, give a little bit more light on the mealtime related effect of this combo product and whether or not there were any difference in timing of dosing of the individual components.

Yes, well, first of all, Richard, I will remind all of us [indiscernible] Montpellier, that was published back in 2003, that actually defined what are the contributions of postprandial glucose to hemoglobin A1c and what are the contributions of fasting glucose to A1c. And for those who haven't got time to read it, a recap is to say that at high A1c levels, 70% of A1c is governed by fasting glucose and 30% by postprandial glucose, and that's when you have 9% to 10% A1c. While at low A1c levels, around the 7% level and 6.5%, it is the reverse. That 70% is governed by PPG and only 30% by the fasting glucose. And that means to say that what we are talking about here is that you have to improve the postprandial glucose control at all 3 meals to be able to take any diabetic subject from a level of around 7% down to below 6.5%. That is what the Romans call a [foreign language]. Now what has been going on in IDegLira in DUAL I is that patients have been allowed to take it any point in time, and that means in the morning, in the evening, during the day. And our view is that there's a split between morning and evening users, and early evidence shows that it doesn't make any difference because of the long action profiles of these compounds. Now importantly, we not only monitor by 9 points of measured plasma glucoses, but also by continuous glucose monitoring, also known as CGM. And what we found is that there are equal and highly significant reductions mediated by liraglutide in the IDegLira component across each and every single of the 3-meal dose of the day. And that is also reflected by the notion that fasting glucose levels in IDegLira was similar and not different from those in the Tresiba arm, suggesting and proving that it is indeed the postprandial glucose excretions that are significantly ameliorated towards the level of people with normal excretion, i.e. non-diabetic. Lars Rebien Sørensen: Thank you very much. I hope that clarifies, or at least shed some light on the last question.

Our next question comes from Michael Novod of Nordea. Michael Novod - Nordea Markets, Research Division: It's Michael Novod from Nordea Markets in Copenhagen. Just 2 questions to the pipeline. First of all, a follow-up on IDegLira. Could you perhaps provide some light on your strategy? Now you've shown superiority in this study to each of the components, and going forward, how should we see this positioned in the market? You're filing within the next 19 months, so it's rather close to the markets, so it will be interesting to learn a bit more about that, also regarding potential pricing, et cetera. And then secondly, perhaps provide more flavor on the semaglutide Phase III program in terms of the dose or the doses you are selecting for the Phase III development, that would be very much appreciated. Lars Rebien Sørensen: Thank you very much. This is Lars Rebien here. And Mads, you can prepare yourself for the semaglutide Phase III dosing question. In terms of the positioning of IDegLira, these results are not entirely surprising. And since we've basically been able to show that when we put the 2 products together, you get basically the effect that you would have anticipated if you'll model it. And then you got -- because of the sort of, you could call it, intelligent effect, a glucose-dependent effect of Victoza, you get the ability to drive HbA1c further down without any unwarranted [ph] effect when making the combo. This is all the things which we had hoped for and anticipated. Now the key question here is, of course, how to position this going forward? There are, presenting itself, a number of options. One would be to intensify treatment for Victoza patients that are failing or are finding it difficult to retain their HbA1c levels. Another opportunity would be to stop patients on the combo if they had a very, very high HbA1c level when they are failing on the orals or if they indeed never were on orals and are diagnosed with a very high HbA1c level. And finally, there is, of course, also the opportunity of strengthening insulin therapy by adding GLP-1 to insulin therapy which is, in fact, already done today and practiced by physicians and patients today. So then I will also add that this is an obvious, very competitive area. And we find no interest whatsoever in disclosing our going positioning statement for this drug until we have concluded further studies and also are getting closer to the actual launch, because of the severity of the competitive situation that we will be facing, especially with our dear competitors from [indiscernible]. I hope that even though disappointing, and as little as you got, just surprising, you can say basically that there are certain limits as to how you can price these, because in such use of combos, open the sale for loose combos, and therefore, if we overpriced this then people would be starting to use the individual components. And so the pricing are likely to be relatively close to 1 plus 1, basically taking the cost of the Victoza and adding the cost of degludec to the combo in the given ratios, and then perhaps a little fee for the nuisance of having had to mix it. But that's kind of how you should think about it.

Yes, semaglutide, as I understand it, the question related also to dosing in Phase III. So Phase III, first of all, is a very big program. 8,000 patients in the sustained program is a lot, and is of course driven by the [indiscernible] guidelines of the FDA and soon to be, actually this autumn, also by the European authority. And that is also why the first trial we're going to start is going to be a [indiscernible] trial where we're going to measure for a couple of years in high-risk patients outcomes such that this will enable a new drug application as soon as possible. Now the Phase II data that you may have seen on the EASD website are very powerful in terms of the A1c reduction. In fact, it's the first GLP-1 agonist that has shown higher A1c reductions than liraglutide; it normally is the other way around. Now then the question is which doses to select, and we selected a couple of doses. And let me just say that they are selected in such a way that, a, we should be able to beat the existing -- or sorry, we are going to set out to beat the existing once-weekly GLP-1 on the market based on efficiency, simply; and, b, we will have a competitive offering where people either can have a fully glycemic efficacious dose or one that may add the benefit of some more weight loss, as is much the case for Victoza today. Lars Rebien Sørensen: Thank you very much, Mads. I hope that answers the questions.

Our next question comes from Peter Verdult of Morgan Stanley. Peter Verdult - Morgan Stanley, Research Division: Peter Verdult here for Morgan Stanley. Just two I want to focus on with Jesper, and maybe Lars and Mads. Just, Jesper, can you just remind us how much the 10,000 patient BEGIN and BOOST program for degludec cost to run? And maybe give a ballpark figure for the costs relating to the launch of degludec that's being pushed now into 2013. A quick add-on there is just U.S. pricing trends across the insulin portfolio for the industry continues to the price on the upside, just wondering what your thoughts are there. You've been pretty relaxed about the ability to put pricing through in the U.S. I'm wondering if that has -- that you become more confident, or has anything changed as you get the crystal ball out and look out a few years? And then just coming back to the obvious question around the AdCom. I'm still puzzled by the FDA's decision to convene this AdCom so late in the file. I realize it's their prerogative to do so and that you're not going to a lot of details with respect the ongoing discussions. But just to be absolutely clear, I know the question has already been asked earlier in the call, but you talked about no preclinical signal. I just want to be absolutely clear. In the past, you've been on record as saying there's no safety signal in data package. I first want to make sure that's the case. And then secondly, if that is the case, can we assume that it's all focused on the strength of the data allowing you to make claims on high post and dosing flexibility? Just some sort of help and insight there would be appreciated. Lars Rebien Sørensen: Thank you very much. Firstly, Jesper, can you take care of the BEGIN and BOOST, the cost associated with that trial, and then also share a little light on the magnitude of the cost that we had to defer through 2013. Then I'll comment a little bit on the U.S. pricing. And then Mads will try to go around the subject again which is so difficult to address, but please, Mads.

The BEGIN and BOOST trials that we ran for Tresiba and Ryzodeg was a 10,000 patient trial run over 1.5-year period or so. And I think, as a rule of thumb, it's fair to say that it will cost you in the ballpark of DKK 100,000 per patient. So you'd get to a number very close to DKK 1 billion or so for this trial, or around, ballpark figure, USD 200 million. In terms of the Tresiba launch, we have to note that the costs that had been deferred are solely the launch marketing cost that has been deferred into '13, whereas the cost of expanding the sales force was still beyond the taking and, of course, there was simply a higher focus on marketing of Victoza in the second half of 2012. So those costs will still be incurred. And so I think if you give a ballpark figure, it would be something in the magnitude of 0.5 percentage point on the S&P ratio that has been impacted. But again, it -- the precise effect of that will have to come down to what is the outcome of the AdCom and then how quickly can we ramp-up for a potential launch in the U.S. But in ballpark of 0.5 percentage point, I think, that's a reasonable estimate. Lars Rebien Sørensen: And on the U.S., of course, it is interestingly ironic enough that nothing is disappointing that is not good for something, and the fact that we are now having to plan with a launch of degludec or Tresiba in the beginning of '13 means that we have full marketing power on Victoza and on modern insulins. And they are actually the product that are driving the predominant part of the growth in the first half. And so this will strengthen our case and situation in the U.S. where we have a good momentum behind our insulin business. With regards to pricing, yes, it is perhaps surprising that it is -- we've been able to follow the competition in terms of increasing prices in general on insulin products to the tune of some 6%, 8%, 9%, in that order of magnitude. You've got to bear in mind though, that these are list price adjustments and they are often associated with very significant repays, but the flow-through on our net sales is much, much less than the increases that you hear and refer. In terms of going forward, I think our picture is still the same, that we would be expecting that we'd see relatively modest price increases going forward. So -- but it's all determined by the competitive situation. And so far, it is predominantly been: Leary [ph] and ourselves that determine the price list of insulins in the U.S., with, of course, Sanofi driving the basal price level, given they're the leaders in this segment in the U.S. But there's still caution about the outlook going forward. Mads?

Yes, well, first of all, I just remind all of us that things have happened since the former generation of insulin such as Lantus and Levemir, and these are along 3 lines. One is that in 2007, the FDA issued their Amendment Act according to which numerous entities, as a default position, will undergo an advisory committee unless there were specific reasons why they need not to do so. And since then, we've also seen the advent of 2 sets of FDA-mandated guidelines within diabetes, a general development guideline and a CV guideline. So when we moved specifically to degludec, 2 things before I go through specific data or the data and such. One is that degludec has been proven and submitted in the dossier to work as insulin, and only as insulin, period. Doesn't buy into any other receptor, it has an on and off rate constant basis compatible with that of human insulin and so on and so forth. So degludec is to be an insulin with an ultra-long action profile. And by the way, the way it's degraded by the body, whether it's animals or humans, is into natural ingredients such as carbon dioxide, amino acids that can reenter the pool of substrates in the body, and water. Finally, we have not had any statistically significant findings at or preclinically or clinically in the statistical analysis plans that have been incorporated in the various protocols and studies, aside of the benefits we are seeing on hypoglycemia, which we've discussed many times. Lars Rebien Sørensen: So I guess that is as close as we can get to it. Mads, thank you very much, and thanks for the questions, Peter.

Our next question comes from Keyur Parekh of Goldman Sachs. Keyur Parekh - Goldman Sachs Group Inc., Research Division: I have two, if I may. Lars, I realize this is kind of fairly early in the year for you to give us any specifics around the next year. But just as we think about some of the pushes and pulls on the margins, given the cost phasing into next year, how should we think about the broader operating margin picture for next year? And secondly, as we look at the guidance and what it implies on a local currency basis, you had originally stated that we should expect NovoSeven to be flat for this year, but the second quarter was slightly ahead of expectations. Is the original guidance for flat NovoSeven for the full year still valid, or should we assume that it will grow, and if that was driving the upgrade to your local currency guidance? Lars Rebien Sørensen: Thank you very much. Yes, you are -- this is Lars Rebien here. Yes, we are a little bit early in terms of discussing 2013. But you can say in a way that we anticipate that we would have cost pressures in 2012 because of the launch of Tresiba and Ryzodeg. These launch costs are primarily being deferred onto '13. Of course, with some potential for impact in Europe and Japan of a launch late in the year, but that will be so marginal that it doesn't really have any impact. So we will be anticipating that we can look at a sales growth in the area of around double-digit, then we will have a cost pressure next year, which will put pressure on our ability to grow operating margins. Our long-term operating margin target has been 15%. This is where we are guiding right now. So I would anticipate that next year, that number will come down as a result of the launch of these products globally. And then with regard to NovoSeven, yes, we had a rebound in the second quarter. Our overall anticipation for the full year is still flat. So we have not included any continuous rebound of NovoSeven. When we look at the usage in the second quarter, it is predominantly situated around some individual patients to hide bleeding that have had serious incidents, and therefore, not likely to repeat itself with any irregularity. But it does occur, occasionally, and we've seen the positive effects of that in the second quarter of this year.

And in terms of the change in the sales guidance, largely due to no effect from the NovoSeven side, the quotation included there for a later event occurring of generic competition for a brand in the U.S. and also a slightly better pricing environment in the U.S., those would be 2 key factors in the approximately mid-point 1% of drop rate. Lars Rebien Sørensen: Solid business performance, so that's what gets you to the upgrading of the sales from Novo Nordisk.

Our next question comes from Jo Walton of Crédit Suisse. Jo Walton - Crédit Suisse AG, Research Division: I've just got 2 quick ones. First one is, what would you do in terms of pricing for the degludec, DegludecPlus if you don't get your superiority claim? And secondly, I wonder if you could update us as to any formulary negotiations you may have been able to make for next year. This seems to be the beginning of the formulary season, how should we look at that for next year? Lars Rebien Sørensen: Jo, this is Lars Rebien here. I'd like to get an approval first before we start to speculate on an internal label that we discuss from. So therefore, I don't want to speculate into a hypothetical scenario of not being able to get the hypog claims. We have strong hopes and optimism that we will get some kind of hypog data, if not claims, that we can promote these products on. And we hope, in fact, that we will be able to use the AdCom to demonstrate to the agency and the experts how important hypoglycemia is. And so the outcome is, of course, one thing that they want to review with, but we also have to highlight the benefits and we're certainly going to do that. So I don't want to speculate on a negative hypothetical scenario, because I don't think it's going to happen. Jesper, do you have any comments on the formulary other than to say that we reacted to quite aggressive pricing strategy from our competitors about a year ago? You have seen the result of this, and you can say by doing so, we've sent a signal that we want to stay competitive. And so our action on formulary negotiations will be dealt with according to the competitive scenario for each individual main scale organization. The upside, whether it's exclusive or whether it's nonexclusive, what our current market share is, with a particular health organization, whether they can pull patients and switch patients on competitive [indiscernible]. It's a very complex picture. And you can rest assured that we will stay competitive also going forward.

And with a -- Jo, with a very significant price competition occurring in the declining human insulin segment in the U.S.

Our next question comes from Martin Parkhøi of Danske Bank. Martin Parkhøi - Danske Markets Equities, Research Division: Martin Parkhøi from Danske Bank. First, a question to Mads regarding liraglutide in obesity. I know, of course, a lot of discussion is whether or not you need to do additional CV studies ahead of approval. Can you tell us, in your discussions with FDA, when can you actually get clarity on this? Can you actually already getting clarity of this, this year, and would you communicate that to the market? And then secondly, with respect to China. we see some pipe-grade [ph] volatility in your growth rates in China with Q2 being quite good. Are there external things in this? How should we see it long term, are we still at the 15% insulin growth level? Lars Rebien Sørensen: Thank you very much, Martin. Mads Krogsgaard [indiscernible] obesity, [indiscernible] requirements, and when are they going to say something?

Yes, well, first of all, Martin, it is -- you're probably also aware, typical that a company like Novo Nordisk, and in this case, we certainly have done so, will have discussed with the agency under the circumstances that prevailed at that point where you had the discussion. We did indeed ask these questions about calculate [ph] the profiling, the leader program done for liraglutide in diabetes and all the overall studies that have been done at the doses that are relevant in diabetes and what we intended to do in the Phase III scale program. And at that point, when we had this discussion, it was deemed to be sufficient evidence for the calculate [ph] the safety of the liraglutide without further pre-approval a 3-milligram studies related to cardiovascular risk in the obesity setting. Of course, we're also cognizant the notion that the FDA is coming up with obesity CV guidelines potentially later this year. And if and when they are published, it is of course highly relevant to discuss with the agency how to handle those products that have been called in the interregnum period between one and the opposite of guidelines but at this point, there are no specific plans to do so, because we've had the discussion previously. Lars Rebien Sørensen: Thank you. And then Jesper onto China, any comments? Are there any extraordinaries in there, and what should we think about as growth rate is going forward?

The China business for Novo Nordisk is more or less, solely a diabetes care business. And the guidance that we've provided historically would be an expectation to a growth in the ballpark of 15%. And I think that's still a very meaningful guidance for 2012. And the numbers, I'd say here, are of course in local currencies. If you look at it, year to date, we have been looking at a growth rate in China in the ballpark of 13%. But I do note that the comparisons going into the third quarter will be easier. And actually, the second quarter did see some higher level of growth. I think local currency growth in China was about 18% in the second quarter, and that was reflecting the impact on the change of price in the -- occurring in China where there was some insulin restrictions that were already imposed in Q2 last year, and that impacted the growth in Q2 alone. And Q3 last year, we've had a change in the pricing for the human insulins in China occurring, and hence, when we get to the full year, I'm pretty confident we'll be in the 15% ballpark. There is an uncertainty factor surrounding potential price reform for -- also impacting the modern insulins, and especially for Novo Nordisk, the NovoMix in China being a very significant product. And we saw, when the price reform was impacted last time, there was an immediate significant stopping effect. And hence, whether or not there will be a pricing reform impacting NovoMix in China, in the second half of the year, it could impact overall growth number. But 15% will be the ballpark.

Our next question is from Brian Bourdot of Barclays. Brian Bourdot - Barclays Capital, Research Division: It's Brian Bourdot from Barclays, calling from London. I'd like to ask you about 2 areas, please. The first is vatreptacog alfa, and the second is the insulin markets. First on vatreptacog, could you tell us, please, what the overall incidence of antibody formation is with NovoSeven in your experience? I think the label describes it as isolated. And what the clinical consequences are for someone who develops neutralizing antibodies in this setting with the alternative treatment options such as bypass and therapy are still available. And also whether there are any similarities in structure formulation or excipients between vatreptacog and any of the other drugs that you're developing in your homeostasis programs. So that's vatreptacog. The second thing I'd like to ask you about, please, are the insulin markets. Despite the obesity diabetes pandemic in the developed world and increased life expectancy, insulin volumes don't seem to be growing in Europe or Japan. I know you've spoken about this before, but I was wonder if you could offer any updated thoughts on the dynamics occurring in these markets. Lars Rebien Sørensen: Yes, certainly we would like to do that. And, Mads, why don't you start giving your perspective and some insight into the formation of the antidrug antibodies for NovoSeven as we know it from our clinical experience?

Yes, well, so first of all, NovoSeven has been on the market since 1996 in Europe at least. And that means that we have seen 16 years of experience, and we have never seen inhibitory or even antidrug antibodies in inhibitor patients. The only 3 instances where we've seen them is in patients that were congenitally born, or i.e. had congenital deficiency of factor VII. They would recognize it as a non-cell protein and generate antidrug antibodies. So for NovoSeven, it is a clear situation. There is not such an occurrence. For vatreptacog, we have seen that in some patients, and since we are only dealing with 72 patients here, we are in a situation where this is worrisome. The fact that whether it's clinically neutralizing or not, we don't know yet, because we haven't seen the clinical trial results. But we have not seen in a blinded manner at least any dramatic situation where people have not been able to treat themselves with the agents that include the vatreptacog and NovoSeven in the drop randomized fashion. But of course, with a safe agent like NovoSeven, it will never be good news for neither vatreptacog nor any inhibitor agent for that matter if it conveys antidrug antibody risk. The other pipeline parts in ATP, vatreptacog and in ITP, they have the good fortune of being non-mutated, i.e. they're not analogues. One of them is just [indiscernible] truncated version of native factor VIII, that's turaptacog [ph], and the 2 others, they actually released the active native VIIIa and IXa respectively, upon cleavature [ph] of the activation peptide, so they are non-altered molecules. Lars Rebien Sørensen: And then onto the insulin market, and thank you for that question. Yes, it is -- if we look at the overall insulin market globally, we are talking about a volume growth of around 5%. This has been coming down somewhat due to a slowdown in the volume growth in North America. And where -- and also, as you already alluded to, a not recent slowdown in Europe and in Japan. However, we do see that trend from growing wealth and urbanization in China and in IO, where we have growth rates in China and IO at around 18% in both regions. Whereas we were talking about the very low growth rates in Europe of around 2% to 3% and very low growth rates in Japan, even less than the 2%. And United States is currently trailing at around 3% to 4%. The reason behind that seeming slowdown, you can speculate, our current assumptions or speculations are the very expanded use of PPP IV [ph] inhibitors, which we see typically in Europe and the United States impacting the number of patients with a new treatment option, which they can take advantage of for some period of time before they need to do something else. And that something else being going onto GLP-1, which is a more powerful treatment, or a combo product of GLP-1 and insulin, or an insulin. So the question is that we need to get to a point of equilibrium where the PPP IV [ph] inhibitor penetrated the market to the extent that it will get a same flow in and flow out of patients that are identified in therapy. This usually takes 2 to 3 years or something like this. We saw it when we go back and saw the introduction of insulin synthesizers as a new class of drugs that was added to the arm intended to treat type 2 diabetes. That led to stagnating growth rates for, if I'm not mistaken, 3 to 4 years. And then we saw this onset of growth. The underlying dynamics is not going to change. More people are getting diabetes, people with diabetes are living longer. And so we still uphold the overall estimate that the volume demand should grow approximately 5% per year. Thank you very much, ladies and gentlemen. I think we overstayed our welcome here shortly. But we appreciate your interest in our company, and we will get back in 31st of October with our release for the third quarter. And then we are approaching the very interesting day in November 8, which I'm sure we're all looking forward to, to put behind us. And so thank you for your interest.

That will conclude today's conference call. Thank you for your participation, ladies and gentlemen. You may now disconnect.