Lars Rebien Sørensen - Chief Executive Officer and Member of the Senior Management Board Kåre Schultz - President, Chief Operating Officer 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

Tim Race - Deutsche Bank AG, Research Division Richard Vosser - JP Morgan Chase & Co, Research Division Michael Novod - Nordea Markets, Research Division Michael Leuchten - Barclays Capital, Research Division Sachin Jain - BofA Merrill Lynch, Research Division Peter Verdult - Citigroup Inc, Research Division

Good day, and welcome to the Q1 2014 Novo Nordisk A/S Earnings Conference Call hosted by CEO, Lars Rebien Sørensen. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Lars Rebien Sørensen. Please go ahead, sir. Lars Rebien Sørensen: Thank you very much, and welcome to this Novo Nordisk conference call regarding our performance of the first 3 months 2014 and the outlook for the full year. I'm Lars Rebien Sørensen, the CEO of Novo Nordisk. With me, I have President and Chief Operating Officer, Kåre Schultz; Chief Financial Officer, Jesper Brandgaard; and Mads Krogsgaard Thomsen, our Chief Science Officer. Present are also our Investor Relations officers. Today's earnings release and the slides for this call are available on our webpage, novonordisk.com. The conference call is scheduled to last approximately 1 hour and, as usual, we'll start with a presentation as outlined on Slide #2. The Q&A session will begin in about 25 minutes. Turn to Slide #3. I need to advise you that this call will contain forward-looking statements. These 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 this web -- this conference call is being webcast live, and the replay will be made available on our website. Turn to Slide #4. With the partial loss of reimbursement with a large pharmacy benefit manager in the U.S., generic competition to Prandin and a tough comparative, the start of 2014 was expected to be difficult. The further [ph] impact from the loss of reimbursement and unexpected changes in the inventory level at wholesalers in United States have made the start of 2014 even more challenging than anticipated. Despite the challenges, sales increased 7% in local currencies and 2% in Danish kroner compared to the first 3 months of 2013, driven by North America, international operations and Region China. Sales growth was realized both within diabetes care and biopharmaceuticals, with the majority of growth coming from modern insulins and Victoza. There will be a contributed -- the majority of growth within modern insulins. The rollout of Tresiba, the once-daily, new-generation insulin with an ultra-long duration of action continues to progress with encouraging performance in countries with markets on par -- with market access on par with insulin glargine. On the R&D front, the cardiovascular outcomes trial, DEVOTE for Tresiba is progressing ahead of plans and we now expect to have sufficient data to support an interim analysis by mid-2015. Finally, on diabetes care DUAL III results, we confirm the very promising profile of Xultophy, the intended brand name for IDegLira, is a potential treatment for people with type 2 diabetes. In February, we successfully completed the first Phase IIIa trial on N8-GP, a long-acting factor VIII derivative for hemophilia A patients. We expect the 3 remaining trials in the Pathfinder program to be finalized within the next year. With the expanded portfolio of hemophilia products, we decided to increase our production capacity. Consequently, the submission of N8-GP will be delayed until this capacity expansion program is operational. Turning to the financials. Operating profit grew 15% in local currencies in the first 3 months. As reported, operating profit grew 6% reflecting the negative impact from key invoicing currencies. Diluted earnings per share grew 10%. The challenging start of the year has led us to lower expectations for sales growth 2014 where, when measured in local currencies, now expect sales to grow 7% to 10% against previous expectations of growth in the range of 8% to 11%. The lower expectations for sales growth in 2014 reflect a more modest growth of the GLP-1 segment, as well as the negative impact from changes in inventory levels in United States wholesalers and earlier impact from the partial loss reimbursement with a large pharmacy benefit manager in the U.S. For operating profit, we still expect growth to be around 10%, despite the lower outlook for sales growth. The growth outlook for operating profit reflects continued expansion of investments in key development projects as well as continued investments in key growth markets, which is more than offset by lower expectations to costs related to back office functions and more modest promotional investments. With this, over to Kåre Schultz for an update on the sales. Kåre Schultz: Thank you, Lars. Please turn to Slide 5. In the first 3 months of 2014, North America accounted for 45% of growth followed by international operations and China, accounting for 27% and 24% of growth, respectively, measured in local currencies. Sales growth in North America was 7% in local currencies. The sales growth reflects the continued positive contribution from pricing in the U.S. and market share gains for Levemir and Victoza. Sales growth in North America was negatively impacted by the partial loss of reimbursement with a large pharmacy benefit manager, generic competition to Prandin, changes in inventory levels at wholesalers as well as an increasing level of rebate payments. Sales within international operations grew by 12% in local currencies, reflecting robust penetration of all 3 modern insulins and a continued strong performance in the biopharma business. Sales growth of Victoza also contributed positively to the growth in international operations, while sales of human insulin declined. Sales in Region China increased by 18% in local currencies. The growth was driven by all 3 modern insulins and was positively impacted by increases in distributor inventory levels, while sales of human insulins only grew modestly. Sales in Japan and Korea grew 8% in local currencies, reflecting the robust uptake of Tresiba, partly offset by a stagnant Japanese insulin volume market growth and negative impact of a challenging competitive environment. Growth in Japan and Korea was positively impacted by increased wholesaler inventory levels due to the increased consumption tax in Japan, effective from 1st of April 2014. The performance in Europe continues to reflect a challenging operating environment, where a declining premix insulin segment and human insulin sales are only partly offset by the continued progress for Victoza. Please turn to Slide 6. The modern insulins continue to exhibit steady growth in the first 3 months of 2014, amounting to 10% measured in local currencies, while Victoza also continues its steady growth trajectory. Within diabetes care, modern insulins were the primary growth drivers, accounting for 63% of total sales growth, followed by Victoza, accounting for 25% of growth in local currencies. Sales growth within diabetes care was partly countered by declining human insulin sales and a declining OAD sales as a result of rapid generic erosion of Prandin sales in the U.S. Growth of biopharmaceuticals reflects continued solid performance of NovoSeven, driving 24% of total sales growth. The sales growth of NovoSeven is primarily driven by international operation and is positively impacted by timing of tenders in the region. Please turn to Slide 7. The DPP-IV, SGLT-2 and GLP-1 segment continues to expand, with DPP-IVs being the biggest segment followed by GLP-1s. Growth, however, has decelerated slightly through 2013 and 2014. Victoza's share growth in the segment between February 2013 and February 2014 has increased to 22% of segment growth compared to 19% in the same period 1 year earlier. The increase in share growth is realized despite the recent introduction of SGLT-2s, which have predominantly been taking share from the DPP-IV inhibitor class. As a result, Victoza's global value market share of the DPP-IV, SGLT-2 and GLP-1 segment is now 16%. Please turn to Slide 8. Sales of Victoza reached DKK 11.9 billion on an MAT basis in the first 3 months of 2014, driven by North America and Europe. Growth is partly offset by the impact of the partial loss of reimbursement with a large pharmacy benefit manager in the U.S. and slightly lower volume growth in the GLP-1 market. The lower volume growth is expected to reflect the introduction of a new class of oral anti-diabetic medications, SGLT-2s, as well as the more persistent impact from the safety concerns raised on DPP-IV inhibitors and GLP-1s in the spring of 2013 and data that's viewed by the FDA and EMA in a joint assessment published in February 2014. As a result, we now expect a slightly lower sales growth for Victoza which, for the next quarters, on average, is expected to be around DKK 100 million to DKK 150 million compared with the previous quarter. Despite lower volume growth, the GLP-1 segment's value share of the total diabetes care market has increased to 6.9% compared to 6.2% in 2013. Victoza continues to be the dominant product within the GLP-1 segment with a global market share of 71%, up from 69% in early 2013. Please turn to the next slide. This slide displays the share of U.S. lives with unrestricted access to NovoLog, Levemir and Victoza. The numbers we present access for U.S. lives covered through commercial plans and Medicare Part D. As can be seen from the left-hand side of the slide, market access remains high for all 3 products, despite the impact from the partial loss of reimbursement with a large pharmacy benefit manager. On the right-hand side, you can see that Levemir continues its strong performance in the U.S. basal insulin market, while NovoLog and Victoza have been hit to their shares of their respective market segments. Please turn to the next slide for an update on the Tresiba rollout. The rollout of Tresiba continues to progress. Launch activities are proceeding as planned and feedback from patients and prescribers is encouraging. Tresiba is now commercially launched in 12 countries, most recently in Germany, Malta, Bangladesh and Lebanon, with more than 20 additional countries expected to launch during 2014. In the countries where Tresiba is reimbursed on a similar level as insulin glargine, it has steadily grown its share of the basal insulin market. In these countries, Tresiba now represents between 10% and 17% of the basal insulin market measured in monthly value market share. Zooming in on recent weekly data, we are encouraged to see that Tresiba, following the lift of the 14-day prescription limitation, now holds around 20% basal value market share in Japan. In markets where Tresiba has been launched with restricted market access compared to insulin glargine such as in the U.K. and Denmark, market penetration remains modest. Now over to Mads for an update on research and development.

Thank you, Kåre. Please turn to the next slide. I'll start with Tresiba, for which the cardiovascular outcomes trial, DEVOTE, was initiated in October 2013. DEVOTE recruitment is progressing ahead of plans and, consequently, Novo Nordisk now expects to have sufficient data to support a prespecified interim analysis of major adverse cardiovascular events by mid-2015. Previously, this was expected to be 2 to 3 years from trial initiation. Completion of the trial is now expected to be within 3 to 5 years from trial initiation. Previously, this was 4 to 6 years from trial initiation. Please turn to the next slide. We continue to generate new and exciting data for insulin degludec. This quarter, we've completed 3 Phase IIIb studies, demonstrating its competitive profile, both in the new 200 version and in the combination product within insulin aspart, known as Ryzodeg. The first part on this slide shows the effect of adding once-daily Tresiba to patients with type 2 diabetes already on Victoza treatment, but with an A1c above 7% despite treatment. For a baseline HbA1c of 7.6%, people treated with Tresiba achieved an end of trial A1c of 6.5%, while the control arm showed minimal change in A1c. The primary endpoint of the trial was, thus, clearly achieved. And in fact, 78% of the people using Tresiba, in addition to liraglutide, achieved the A1c target of below 7%. Related to this treatment paradigm, the EU Commission has just approved the use of these GLP-1 and insulin products in loose combination in random sequence. The second Phase IIIb trial on the slide covers Tresiba U 200 to insulin glargine in a crossover trial in people with type 2 diabetes mellitus requiring high-dose insulin treatment. In the trial, Tresiba U 200 met the primary endpoint by providing similar HbA1c lowering as insulin glargine but, importantly, Tresiba provided statistically significantly improved fasting plasma glucose control while also demonstrating 40% lower risk of confirmed hypoglycemia. Furthermore, using the validated patient reporting outcome tool, or PRO tool, the [indiscernible] device questionnaire, people reported high levels of device satisfaction, both overall and with regard to the 2 main domains, support device further and function, for the FlexTouch pen versus the insulin glargine SoloSTAR pen. In the third trial, it was shown that people treated with Ryzodeg twice daily achieved a similar level of glucose control as with basal-bolus regimen of Tresiba once daily plus NovoRapid's on average 3x daily. For a baseline HbA1c of 8.3%, the type 2 diabetes subjects treated with Ryzodeg achieved an end of trial A1c of 7.0% compared with 6.8% in the basal-bolus arm, a difference that was not statistically significant, even though the non-inferiority margin was not met. Rates of confirmed hypoglycemia were low in both treatment groups and numerically lower after Ryzodeg treatment than after basal-bolus treatment. Overall, Ryzodeg, thus, provides results using a 1-pin, 2 injections regimen that are clinically similar to those achieved in a full basal-bolus regimen using 2 pens and a total of 4 injections daily. In all the above 3 trials, the established safety profiles of Victoza, Tresiba and NovoRapid were confirmed, and there were no other apparent differences between the treatment groups with respect to adverse events and other safety parameters. Please turn to the next slide. In February, the U.S. Food and Drug Administration and European Medicines Agency published a joint assessment of the pancreatic safety of incretin-based therapies in the New England Journal of Medicine. The paper covers an extensive review of a huge amount of existing preclinical and clinical data available and concludes the following. Thus, the FDA and EMA have explored multiple streams of data pertaining to a pancreatic safety signal associated with incretin-based drugs. Both agencies agree that assertions concerning a causal association between incretin-based drugs and pancreatitis or pancreatic cancer, as expressed recently in the scientific literature and in the media, are inconsistent with the current data. Further, the agencies state that the current knowledge is adequately reflected in product labels and that pancreatitis will remain a safety signal for these drugs until further data are accumulated. Please turn to the next slide. First of all, let me repeat that Xultophy has been selected as the intended brand name for IDegLira. Now over to the results of DUAL III. DUAL III investigated type 2 diabetic subjects who are inadequately controlled on GLP-1 therapy and subsequently randomized to either transfer to Xultophy or to continue GLP-1 therapy. The Xultophy arm achieved a statistically significantly greater average reduction in HbA1c of 1.3% compared to 0.4% for those on continued GLP-1 therapy. 3 out of 4 patients on Xultophy achieved an HbA1c below 7% and almost 2/3 have reached the A1c target of going below 6.5%. The corresponding numbers for continued GLP-1 therapy were distinctly lower. This is, in fact, the third out of the 4 DUAL trials for Xultophy that has resulted in an end of trial A1c of an astonishing 6.4%. The rate of overall confirmed hypoglycemia was, as expected, statistically significantly higher among those treated with Xultophy than for those who continued on GLP-alone therapy. Consistent with the initiation of insulin therapy in the Xultophy group, patients in this group also experienced a weight gain of 2 kilograms compared with a weight loss of close to 1 kilogram among those who continued on GLP-1 alone. The previously reported safety and tolerability profile of Xultophy was reconfirmed and no apparent differences between Xultophy and continued GLP-1 therapy were observed with respect to adverse events and standard safety practices. Finally, we've achieved an important milestone with our pipeline of all insulin candidates as we've decided to progress the first oral insulin project, OI338GT, into Phase IIa testing in the first half of next year. OI338GT consists of an enzyme-stabilized, novel ultra-long-acting basal insulin analogue in a purpose-designed tablet formulation that utilizes the GIPET carrier system. Based on the positive outcome of Phase I trials for OI338GT, Novo Nordisk has decided to discontinue the development of 2 other all-insulin product candidates in their current forms. Please turn to the next slide. We've previously reported positive results from the Phase III trial with long-acting factor VIII for the treatment of hemophilia A. In the trial, 175 patients were treated prophylactically with 50 units per kilogram every fourth day or received on-demand treatment when bleedings occurred. Patients were treated with N8-GP for up to 24 months, resulting in a median annualized bleeding rate of 1.3 and 31 episodes for patients treated prophylactically and on demand, respectively. The pharmacokinetic data documented a single dose half-life of 18.4 hours and a high mean trough level of 8% measured immediately before the next prophylactic dose. N8-GP further appears to have a safe profile and to be well tolerated. Among the 186 patients in the trial, one patient, who responded well to prophylactic treatment throughout the trial, developed an inhibitory antibody. This is in line with expectations in a population of previously treated hemophilia A patients. Novo Nordisk expects the 3 remaining trials in the Pathfinder program to be finalized within the next year. Following recent progress in the hemophilia pipeline, including the successful completion of the pivotal trials for the 2 Phase III development projects, N8-GP and N9-GP, and recent launches of NovoThirteen and NovoEight, Novo Nordisk has decided to increase its production capacity for hemophilia products. Current capacity will be prioritized for the 3 marketed clotting factors plus N9-GP, and the production of clinical material for N8-GP. Potential commercial production of N8-GP will be delayed until production capacity has been expanded and submission of N8-GP to regulatory authorities will, thus, be postponed until the new capacity is operational, which currently is expected to be around 2017 or '18. With that, over to Jesper for the financials.

Thank you, Mads. Please turn to Slide 16. In the first 3 months of 2014, sales increased by 7% in local currencies and by 2% measured in Danish kroner to DKK 20.3 billion. The reported gross margin improved by 110 basis points to 83.0 in the first 3 months of 2014, driven by a favorable price development in North America, improved productivity and a positive net impact from product mix due to increased sales of modern insulins and Victoza. The gross margin was negatively impacted by 50 basis points due to the depreciation of key invoicing currencies versus the Danish kroner compared to the prevailing exchange rate in 2013. Total non-production-related costs increased by 11% in local currencies and by 4% in Danish kroner. Selling and distribution costs decreased by 4% in local currencies and by 8% in Danish kroner to DKK 5.1 billion. The decline in selling and distribution costs is driven by lower promotional spend in North America and Europe and an adjustment to a legal provision, which more than offset the increased cost related to the expansion of the U.S. sales force during the fourth quarter of 2013, as well as the increased sales and marketing investments in China and selected countries and international operations. R&D cost increased by 21% in local currencies and by 19% in Danish kroner to DKK 3.2 billion. The significant increase in cost reflects the progression of the late-stage diabetes portfolio and the oral GLP-1 portfolio. Within diabetes care, costs are primarily driven by the 2 Phase IIIa programs, Onset, for fast-acting insulin aspart, and Sustained for semaglutide, the once-weekly GLP-1 analogue, as well as an impact from DEVOTE, the cardiovascular outcomes trial for Tresiba. Within biopharmaceuticals, costs are primarily related to the portfolio of development projects within hemophilia and the Phase II trial for Anti-IL-20, a recombinant human monoclonal antibody in rheumatoid arthritis. Operating profit in local currencies increased by 15% and by 6% measured in Danish kroner to DKK 8 billion. Net financials show a net income of DKK 268 million compared to a net income of DKK 207 million in 2013. In line with Novo Nordisk treasury policy, the most significant foreign exchange risk for the group has been hit, primarily through foreign exchange forward contracts. The foreign exchange result was a net income of DKK 237 million, similar to the income in the same period in 2013. This development reflect gains on foreign exchange hedging, involving especially the U.S. dollar and the Japanese yen due to their depreciation versus the Danish kroner compared to the prevailing exchange rate in 2013. This positive effect is partly offset by losses from commercial balances, primarily related to non-hedged currencies. The effective tax rate for the first 3 months of 2014 was 22.2%, partly reflecting an effect from the gradual lowering of the Danish corporate income tax from 2014 to a new level of 22% from 2016 onwards. Please turn to Slide 17. Negative impact from currencies and operating profit during the first 3 months of 2014 was primarily driven by the depreciation of the Japanese yen which, in Q1 2014, was 14% below the average rate during the same period in 2013. In the first 3 months of 2014, we have experienced significant depreciation of both hedged and non-hedged currency exchange rates compared to the first 3 months of 2013. In the period, key non-hedged currencies such as the Russian ruble, Argentinian peso, Turkish lira, Indian rupee and Brazilian reais have depreciated with between 16% and 37% versus the Danish kroner. Please note that a 5% move in one of the major non-hedged currencies will have an impact on reported annual profit of between DKK 15 million to DKK 30 million. Consequently, when the non-hedged currencies move simultaneously in the same direction, the impact does become significant. The decline in non-hedged currencies compared to the first 3 months of 2013 alone has had a negative impact on reported operating profit of 3.5 percentage points. Please turn to Slide 18. In 2014, we now expect sales growth to be in the range of 7% to 10% measured in local currencies. Given the current level of exchange rate versus Danish kroner, the reported sales growth is expected to be around 4.5 percentage points lower than the growth measured in local currencies. The outlook reflects expectations for continued robust performance for the portfolio of modern insulins and Victoza, as well as a modest sales contribution from Tresiba. These sales drivers are expected to be partly countered by a more challenging rebate and contract environment in the U.S., generic competition to Prandin in the U.S. during 2014, intensifying competition within both diabetes and biopharmaceuticals, as well as an impact from the macroeconomic conditions in a number of markets in international operations. Furthermore, the revised outlook reflects a more modest growth of the GLP-1 segment as well as a negative impact from changes to inventory levels at wholesalers and on the earlier impact of the partial loss of reimbursement with a large pharmacy benefit manager in the U.S. Please note that guidance for sales growth in 2014 includes lower sales growth in the first 6 months of 2014 than in the second half of 2014. This reflects the timing of trends in generic competition starting in August of 2013, as well as a number of nonrecurring events positively impacting sales in the first half of 2013. In 2014, operating profit growth is still expected to be around 10% in local currencies. Given the current level of exchange rates versus the Danish kroner, the reported operating profit growth is expected to be around 7 percentage points lower than the growth measured in local currencies. The outlook for growth in operating profit reflects a significant increase in costs related to the continued progress of key development projects within diabetes and biopharmaceuticals. As a result of significant R&D activities, the R&D ratio for 2014 is now expected to be in the range of 15% to 16%. In addition, significant costs are expected in relation to sales force expansions and sales and marketing investments in the portfolio of modern insulins and Victoza in the U.S., China and selected markets and international operations, as well as the launch of Tresiba outside the U.S. Despite the revised outlook for sales growth, the operating profit growth outlook is maintained, reflecting lower expectation to costs related to back-office function and more modest promotional investments. For 2014, we expect the net financial income of around DKK 850 million. This primarily reflects gains associated with foreign exchange hedging contracts following depreciation of the Japanese yen and the U.S. dollar versus the Danish kroner compared to the average prevailing exchange rate in 2013. The effective tax rate for 2014 is expected to be around 22%. Capital expenditure is still expected to be around DKK 4 billion in 2014, primarily related to investments in additional GLP-1 manufacturing capacity, expansion of filling capacity, prefilled device production facility, construction of new laboratory facilities as well as an expansion of CMC and protein capacity. Depreciation, amortization and impairment losses are expected to be around DKK 2.9 billion. The free cash flow for 2014 is now expected to be around DKK 25 billion, reflecting an effect from faster payments of rebate liabilities in the U.S. All of the above expectation are based on the assumption that the global economic environment will not change significantly -- will not significantly change business conditions for Novo Nordisk during 2014 and that currency exchange rates, especially for the U.S. dollar, will remain at the current level versus the Danish kroner. With that, over to Lars for closing remarks. Lars Rebien Sørensen: Yes, thank you very much. We apologize for this rather lengthy presentation. But to summarize, we're pleased to be able to reiterate our expectations to operating profit growth for 2014 despite a challenging start to the year and the reduced outlook for sales growth. We are encouraged by the performance of Tresiba in key markets and by the rapid recruitment of the DEVOTE trial, which enables us to shorten the timeline for the interim analysis and the potential U.S. launch. We're now ready to go to the Q&A session. [Operator Instructions] Operator, we'll now take the first question, please.

[Operator Instructions] We will take now our first question from Tim Race from Deutsche Bank. Tim Race - Deutsche Bank AG, Research Division: It's Tim Race here from Deutsche Bank, as the lady said. My 2 questions. First of all, I'll start off on the ability to change your SG&A spend or the discretionary part of that throughout the year. You sort of talked about still being able to keep 10% operating profit margin despite sort of a relatively wide range in terms of sales growth. Just could you talk to me about your sort of flexibility here and how, if you tone that promotional spend down, how it might impact the business more longer term? Then second question will just be on U.S. pricing. It's a recurring theme at the moment for companies with, let's say, products that are branded but relatively similar product offerings amongst oligopolies. Could you just talk about how Express Scripts is really impacting the market? And does this mean payors have worked out how to break the oligopoly, such as in respiratory or diabetes? Or do you think this is just a temporary bump where we return to normalization next year? Lars Rebien Sørensen: Tim, this is Lars Rebien here. I'm glad that I brought Kåre because it seems like the 2 first questions are in your part, Kåre. SG&A cost changes, to what extent are we able to do that given the broad range of top line guidance and any comments on the long-term implications that, that might have. And secondly, your general speculation on whether or not we are seeing a trend shift in the ability of the benefit managers to impact branded products in the U.S., the pricing. Kåre Schultz: Yes, with regard to SG&A, it, of course, always so that the SG&A's combination of, you could say, relatively fixed costs related to manning and your establishment in terms of offices and the whole operations part. And then quite a big part of it is also discretionary spending that is spent on different projects, different initiatives. Some of it very directly promotion-related. Some of it may be more internally related to the processes, projects and so on you might have ongoing. And just to remind all of us, we have had a very, very strong sales growth in the U.S. over the last 10 years. And when you expand rapidly, both your manning and your total operation and your revenues, there will be a tendency that maybe you don't look for all the details of optimization possibilities. And one of the things we are doing now, and I think Jesper can also comment on that after me, is, of course, to look into how can we sort of further improve the efficiency of the money we are spending in the United States. So we don't really see a reduction of our total promotional and detailing pressure in the U.S. It's more a question of doing some really in-depth productivity campaigns and measures, and that is easier when you have a direct motivation by a reduction in sales growth. So we're optimistic that this will be possible for us to do without harming the outlook for future sales growth. And then I'll give the floor to Jesper.

Yes, and then I think it's important to measure here, Tim, that if you look at the percentage savings in the -- in 2014 first quarter, you saw 270 basis points down on last year. You'll also note that you in 2014, have no major launches planned for the U.S., and the expectations we hence would have for the F&D cost for the full year would be a reduction in the magnitude of 100 basis points. So whereas we, in 2013, operated with around 28%, we see a decline to the level of 27% in 2014 and we believe that is certainly manageable. And then back to Kåre on comments on the U.S. pricing environment. Kåre Schultz: Yes. And as we all know, we lost the ESI contract for NovoLog and NovoLog Mix, and then we lost the ESI contract on Victoza, so to speak, up against the exenatide family. And you can then speculate a lot how does that change the sort of pricing power of the suppliers of different diabetes products, different injectable diabetes products in the U.S. If I should give you a sort of a brief rundown on it, then I think we can all see the weaker market shares, and you will be able to see there that the negative impact on the Victoza market share has been significant but limited. So it's clear to see it happens just after the 1st of January, but it is a limited drop in market share we're seeing. And right now, we're seeing actually a slow increase in TRx market share and the U.S. market share. I would say there has been a limited willingness from patients and doctors to switch from Victoza over to the exenatide family. Consequently, there's probably also very limited gain for net sales of BYDUREON and Byetta, the exenatide family, as a consequence of getting higher rebates but not really gaining any significant volume. So that, from a supplier point of view, at least, has not been a very beneficial change in the contracting setup for our competitor. In the space of fast-acting insulin, it's slightly different. We see a slightly higher impact from the change in reimbursement status for NovoLog with ESI. We see it leveling off now. And if we look at the public data from Eli Lilly on their sales of Humalog in the U.S., then there is an indication that their net gain has been very limited because, of course, they paid a higher rebate to get a slightly higher market share. But it doesn't look like, in their first quarter numbers, that there's a significant value gain on their part. So overall, I would say the jury is still out on whether this is something that we will see continued in the future. At least, it doesn't seem to drive significant profits for the suppliers who go into these kind of arrangements. Lars Rebien Sørensen: Thank you, Kåre, and then as we should finally note here that the methodology used by ESI in the blocks has been quite effective, more effective so than we have seen in previous similar contracts. And therefore, we could also state that we felt the impact faster in a way than we would have anticipated. So with those quite lengthy but very important comments, next question, please?

Our next question will now come from Richard Vosser from JPMorgan. Richard Vosser - JP Morgan Chase & Co, Research Division: It's Richard Vosser from JPMorgan. Two questions, please. Firstly, could you update us on the LEADER trial event rate in terms of the cardiovascular events, how that's progressing with the trial and when that's expected to report now? And whether you've taken that event rate that you're seeing into account for the new timelines for the DEVOTE trial? And the second question, just on CapEx. Clearly, the CapEx investment has come a little bit too late for the hemophilia franchise to come earlier, I suppose. When would you consider doing CapEx investments for the oral GLP-1 or oral insulin products to avoid those issues? Or when would you need to do that to avoid the issues we're seeing for hemophilia? Lars Rebien Sørensen: Thank you, Richard. Mads, I guess you're on in regards to comment on the event rate on LEADER and whether or not you made any assumptions from that onto the DEVOTE trial.

Yes. Well, first of all, Richard, when we planned the LEADER trial back in the -- you can say post-approval phase of early 2010 and agreed with the agency on that one, our assumption was around 2 to 2.1 percentage annual event rate of MACEs based on, you can say, the historic performance in such trials. Now you're probably also aware, and I know you're aware, that we, since then, have updated the market that the de facto event rate occurrence is more to the tune of 3% or 3%-plus in that particular trial. And that's now based on, I would say, very substantial evidence surrounding that particular disease population. Now when we designed the DEVOTE trial, we had, of course, first of all, to realize that geographies may pan out slightly differently for DEVOTE than for LEADER, and that you can say ethnic differences do play a role as to how you can imagine the MACE event rates will be in percent terms. And that has also meant that we've decided to have, you can say, a precautionary approach planning for an event rate in the ballpark of 2% or 2%-plus on an annual basis. But of course, the opportunity, since this population is at least as sick as the population that we have in the LEADER trial, then we are in the situation that we cannot make predictions as of yet because the planned event rate of 2% is maybe seen to be, by some, on the shy side. On the other hand, the trial is too early to make any more firm predictions, and this is a very U.S.-based trial, where the LEADER has a more, you can say, global distribution in terms of geographies. When that is said, the estimated time for completion of the LEADER trial, which you also asked about, is in the first half of 2016, by which time we will have provided an awful lot of the MACE events to analyze both the non-inferiority and then the hierarchical structure of the statistical analysis plan, thereafter, pending the data. And whereas, in the case of DEVOTE, what we have there is an assumption that mid-2015, it's something that can happen within the planned MACE event rate as per the protocol. It's simply not driven by any assumption about the event rate, but more the assumption that recruit -- which is not an assumption, but a fact, that the recruitment has panned out quite favorably and much ahead of schedule. Lars Rebien Sørensen: Thank you very much, Mads. And then on to CapEx. Yes, CapEx is, of course, an interesting point. And as you know, we've run into a situation where the progress of our hemophilia pipeline has been more successful than we anticipated. It's interesting, historically looking at it, we had a surplus capacity a number of years because we actually expected to be able to expand the indications for NovoSeven. And -- but since we now have too many factors, several different types of clotting factors, the complexity of doing that warrants that we do have to consider expanding capacity, and that's the reason. And so one of the implications, going forward, for a potential planning for success in the oral space, you saw that we are moving the oral insulin forward. We already have decided to move all GLP-1 forward. I can tell you that we already now, internally, are starting the more theoretical discussions. What this would entail for us is a different kind of investment in as much as it would require also active ingredient capacity expansion. So in a way, the full value chain, new active ingredient manufacturing, with purification and then different downstream formulation and tableting, since it's oral products. It's our current best guess that we -- you should start to see us including such investments in 2016 and onwards, and that they will drive our CapEx up with about 1% of sales in the years and to the extent to which we are successful. So that will be depending on the clinical results, eventually. But we have to hear, again, much like we did with pulmonary insulin and with NovoSeven, invest a little bit ahead of the curve because otherwise, we won't be ready for market. And of course, we really would like to be able to be serving the market with products in our key therapeutic area, namely diabetes, if we are able to make an oral GLP-1 or an oral insulin. So that's the comment as far as that goes.

Our next question now from Michael Novod from Nordea. Michael Novod - Nordea Markets, Research Division: Yes, this is Michael Novod from the Nordea Markets in Copenhagen. Just two questions to Tresiba. Maybe just a follow-on to the other one on the DEVOTE trial. If you have data in mid-2015, Mads, how fast can you actually compile and add to the new filing if data is positive and, thereby, be able to file with the FDA. What is the best case scenario there? And then secondly, to Tresiba in Germany, I know that you have been launching in Germany. But do you have any kind of pricing negotiation with the German authorities, or how are we to consider this launch? Is it a full launch or is it just, say, a part of a shadow market in Germany? Lars Rebien Sørensen: Thank you very much, Michael Novod. Mads, DEVOTE? Data is available sufficient for filing mid-'15. What's the best timeline for when we will file?

Yes, Michael, you asked about the best case scenario, and that's a very short answer. The best case scenario you can do on such data set is about 2 months, and that is not based on, you can say, total analysis of all data, but that would be the primary analysis of the MACE data, so 2 months. Lars Rebien Sørensen: And then, Kåre, a comment. Are we shadowboxing with the German authorities? Or are we in a full launch with Tresiba in Germany? And what is the reimbursement status?

No, there's no shadowboxing. We are all in, so to speak, on the German launch. So it's a full-blown launch of a uniquely good long-acting insulin, and we are very encouraged about the strong feedback we've seen in Japan, Switzerland and other markets. So we are following the standard German pathway, and we will have different interactions with IQWiG and GBA and so on during the next 12 months.

Our next question now from Michael Leuchten from Barclays. Michael Leuchten - Barclays Capital, Research Division: It's Michael Leuchten from Barclays. Two questions, primarily, on your guidance, please? Just firstly, as you pointed out, 2014 is kind of a tale of 2 halves. And if I look at Q1, you had 7% underlying currency adjusted growth rate in Q1. And in a press release, you call out the impact from ESI and Prandin of 5%. If I net that off, that's 12%. As you point out, that tails off that headwind in the second half, yet your lower end of your guidance of 7% implies that there is some sort of headwind that could actually linger into the second half. So I'm kind of wondering what it is that could drive that headwind? And then the second question on Victoza. I appreciate your comments on the market slowdown for GLP-1. But when we look at the volume growth that IMS gives us, we've seen a nice recovery of the GLP-1 market, and within that, Victoza actually does quite well. So I was just wondering what particularly surprised you outside the maybe faster-than-expected forced switches that ESI has been driving? Lars Rebien Sørensen: Okay. Thank you very much, Michael. Jesper, would you care to guide on how one can make the numbers add up, if you look at first half versus then second half, if we clean out the one-off impact in the first quarter amounting to, as we state, 5%?

Yes. I mean, if you look at the 5%, there is a 1.5% element of that, that only hits the first 2 quarters and has a limited effect in -- as it was also hitting in July, in the third quarter, and from then on, it has a limited effect. You could say the ESI effect, which we would estimate at around 2 percentage points of sales, that will have a similar effect throughout the -- all of the quarters. The final one, which we are noting, is an impact to the tune of 1.5 percentage points and which is a, what we see, a lowering of the inventory levels, and we see that predominantly be related to the first half of the year. What we are seeing in the U.S. is a -- compared to our original expectation, we're still seeing, everything else being equal, a lower GLP-1 overall market growth. We're also seeing a lower GLP-1 market growth in Europe, and that can have an impact. On top of that, I would argue that the U.S. rebate environment still provides some uncertainty for us. We are seeing that there is a gradual flow of patients from previously being on the managed care setup to moving to a Medicare Part D setup, and through that, actually providing us with rebate cost in terms of us covering a part of the donut hole under Medicare Part D. So that continues also to account for some of the effect. And then the volatility in international operations will always also fluctuate between the years. And everything else being equal, we would probably have a slightly lower part of tender orders in the second half of 2013 compared to what we have in second half of -- sorry, 2014 compared to what we had in the second half of 2013. So that would be the factors that will drive us down towards the 7% mark in a worst case or in a worse outcome scenario. Lars Rebien Sørensen: Thank you, Jesper. So more uncertainty. Kåre, any comments on the volume development in GLP-1 market and, in particular, Victoza? Kåre Schultz: Yes, we just restate that we are very positive in terms of the outlook for the Victoza market share of the GLP-1 segment. We saw a small decline in the U.S. due to ESI in the first quarter, but we are seeing it stabilizing and starting to grow again now. We see worldwide a good development of the market share for Victoza, so we are still very positive on that. We still see growth, just like what you referred to in IMS, we still see growth of the GLP-1 market. The comment is more to that the growth level came down last year in the second half of last year, and we haven't really seen a rebound of the growth level, which is what we were hoping for. So we are very positive about the segment, in general, but we just don't know whether it will actually rebound to the sort of the growth levels we saw in '12 and early '13, or whether we will stay at the current level. In all cases, we will still see nice double-digit growth of Victoza sales. Lars Rebien Sørensen: Yes, and this is Lars Rebien here. And so this is where the SGLT-2s comes in, whereas we -- had we not added SGLT-2s coming into the marketplace, the rebound for GLP-1s might have been stronger, given the clearance now being seen with both FDA and EMA. But now, the SGLT-2s offer a new treatment choice, and so, consequently, they snap up customers that are either intending to be put on DPP-4s or GLP-1s.

Our next question now from Sachin Jain from Bank of America. Sachin Jain - BofA Merrill Lynch, Research Division: It's Sachin Jain from Bank of America. The first question is a clarification for Mads. If in DEVOTE, the event rate was actually 3% rather than the 2% you've planned for, when could that study read out? And do you have any visibility on the geographic variation that led you to plan slightly differently? That was just a clarification question. And my two questions on the GLP-1 market and SGLT-2s. The second SGLT-2 launch is clearly aided market expansion. So if you can just give us some color on do you expect a similar benefit to the GLP-1 market on dulaglutide and albiglutide launches. Or given the slightly low growth that you're seeing, what's the risk that the new players, Glaxo and Lilly, are more aggressive on share gains rather than market expansion than we've been expecting? And then the second question, given you've cited SGLT-2s, how incrementally concerned should we be about the SGLT-2 DPP-4 fixed dose combination launches late next year, given the potential A1c and weight loss profile not materially dissimilar to Victoza. Lars Rebien Sørensen: Thank you very much. Why don't we start with you, Mads, if you can comment on what if 3% event rate, what does that have as implication for the DEVOTE timeline? And then if you'd also care to comment your perspective on the combination, the larger combination probably between DPP-4s and SGLT-2s. And then I'll come back and talk a little bit about how we see dula and albiglutide impacting the market.

Okay. So first of all, Sachin, obviously, right now, what has been the primary determinant for our assessment of when we'll have the data ready for the interim analysis has simply been a question of having exposure to patients, have patients on board. And then at this point, we have not even guesstimated, as I mentioned, about what exact MACE event rate we're going to see. But you're, of course, correct in the sense that if it is higher than protocol-specified, then things will happen earlier. We are speaking just a few months basically at this point, but they -- it will have bigger impact on the end of the trial. So where the truly biggest impact is obviously when you have fully recruited the trial, then there's a huge difference between whether you have 1%, 2%, 3% or 4% annual event rate. That goes without saying, up to a swing factor of twofold or more. Geography-wise, you did ask the question about -- this is a vial-based, blinded vial-based trial, and that means that there are many geographies we are not operating in, to the same extent as we were in the LEADER trial, because basically vials are not popular, for instance, in many Western European countries. When that is said, I cannot go out and claim to you that we are seeing clearly dissimilar MACE event rates, or at least, we don't know the data because they are blinded. But it's not my interpretation that there are very distinct differences at this point. I'm just flagging that the geography is different in this trial than in the other one. But at this point, you can guesstimate all the way from the protocol of 2% to the LEADER rate of 3% or so. It's too early to say. And then, sorry, Lars, on the combo? Lars Rebien Sørensen: Yes, if you could give us your rate on the combo?

Well, first of all, my view is that Victoza, even though we are advocating the use of Victoza being a great product as first-line or second-line therapy after metformin, that's kind of what we've been saying ever since 2009. We also know that in reality, Victoza typically gets chosen after, for instance, also the first DPP-4 inhibitor of the lag rate for where the stay time, typically, is shorter because of the more modest efficacy. And obviously, when you have a combination tablet between, for instance, a DPP-4 inhibitor and an SGLT-2 inhibitor, you do get the added benefit of more efficacy and maybe some weight loss driven mostly by the SGLT-2 component. But you have to bear in mind as such in that the way Victoza is used today is typically in an order where people had been on 2 or even 3 OADs in advance, and in that scenario, it doesn't make a big difference. But of course, the convenience of the patient to use the combo rather than 2 individual tablets before he or she goes on to injection-based therapy, that's, for the patient, different, of course. Lars Rebien Sørensen: And then finally, a comment from me on the GLP-1 market. Sachin, I would in a way say that dula and albiglutide is in a way similar to Victoza and the exenatide in the sense that dula -- our expectations are that dula will be comparable to Victoza on blood glucose-lowering. We don't know what the other part of the profile will look like. It's anybody's guess. But similar -- let's just assume, similar. So I would believe that Lilly would see an interest like us in expanding the market segment. And if GSK study the learnings from the ESI experience of EMS, AstraZeneca, on what they gained out of buying their way into that exclusive contract, actually not gaining anything, and I would tend to believe that the players will ask to expand the segment, if they have long-term interest in being in this field. So that would be my take, rather than clarifies competition. But I mean, your guess is as good as mine. A weakness on product competitors often lead people to do short-term things.

Your next question from Peter Verdult from Citi. Peter Verdult - Citigroup Inc, Research Division: Pete Verdult, Citi. Just a few, maybe, just to round out. Just for Lars or Kåre, U.S. rebate environment getting more challenging, diabetes competition increasing has been a recurring theme on the call. Ahead of, obviously, all the Phase III data readouts next year, could you just update us on your thoughts regarding the opportunity to win back the ESI contract or, more broadly, the willingness to offer more rebates? I'm assuming that's not the -- that your position is unchanged, but I just wanted to sense check that. And secondly, just a quick one for Jesper. Could you just give us the simple price mix volume dynamic that you're seeing for the U.S. modern instrument business at the moment? And then on China, you called out 90% growth, but I wanted to know what the underlying growth was in China when you exclude the distributor inventory levels being raised. And then maybe cheekily, if I may. Mads, just recent interactions with leading U.S. cardiologists highlight a growing concern around the DPP-4 class in terms of heart failure signals. I'd just be interested in your thoughts there. Lars Rebien Sørensen: Thank you, Peter. This was nicely done, 3 more questions added in and the last one. You did not expect that we would comment on our negotiation strategy on ESI, would you? But I'll ask Kåre slightly differently, perhaps. What is his appetite for raising rebates next year and be competitive? Kåre Schultz: Yes, first of all, I would say I don't think there's a fundamental change to the competitive situation. The competitive situation is mainly determined by the demand side that develops stable in terms of demand for injectable diabetes therapy and the supply side. And there are no major launches right now on -- from the supply side. So we have the same competitors, as we normally have. We have the same number of competitors as normal. And with regard to rebating, we constantly optimize our rebating strategy with the aim to secure long-term growth and profitability of our business. So you will see us continue to do that and that's done on a case-by-case basis, and we think we're relatively good at it and that's what we intend to do going forward, also. So optimization on a profit level long-term. Lars Rebien Sørensen: So I'll just -- before I hand over to Jesper to close it off, on China, you should basically see our business in China as growing 15% per year on average. Jesper, then, the final -- close it off. Take it home.

And on the modern insulins in the U.S., Peter, you asked about what would be the price effect and what would be a volume mix effect. And basically, you could say it's slightly more than 2/3 that is priced and slightly less than 1/3, which is a market share and volume increase -- and the volume increase primarily coming, of course, from Levemir in the U.S. And then you also asked what is the impact on the growth rate from the development in inventories in China. And there, I would estimate, probably to the tune of 5% is the split between fourth quarter 2013 being shifted into the first quarter of this year. A magnitude of 5% on China growth, that would be our guesstimate. Lars Rebien Sørensen: Okay. And ladies and gentlemen, that concludes our call for the Q1. We will be back -- our investment team will be out on the road talking to many of you during the next days, but we'll be back after summer holidays with the numbers for the first half. Thank you very much.

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