Good morning everyone, and welcome to Hikma's 2026 interim results meeting with our CEO, Said Darwazah, and acting CFO, Areb Kurdi, and we also have Susan Ringdal and myself, Guy Featherstone, Investor Relations. Before we start, I would like to remind you that any forward-looking statements or projections made by Hikma during this call are made in good faith based on information currently available and are subject to risks and uncertainties that may cause actual results to differ materially from those projected.

For further information, please see the Principal Risks and Uncertainties section in Hikma's latest annual report. With that, I'll hand over to Said for opening remarks before we head to Q&A.

Thank you. Thank you so much.

Just quickly a few things to say. Obviously you saw the results, sales are up.

I think what's very exciting is that EBIT and EBITDA are up by almost 8%, EPS is up by 5%, and when we met last time we said we had four targets this year, one is to stabilize the business, and really we're talking about the Injectables business, the other two businesses were doing well. I think this has been achieved.

We talked about making the company more agile, quicker decision making, and we have taken tons of decisions, and now the way the company is structured, I think very much supports this quick decision making, supports the senior management of the team to take quick decisions and to take quick actions and reactions while they are needed. We said we will invest for the future, we have done a lot of investment in people, I think is most important, in talent and people.

We have done investment in equipment, and of course R&D spend as you can see is up, we are really setting up the company for the future. Again we feel extremely comfortable to reiterate full-year guidance as we have seen MENA's done extremely well, exemplary good.

I've always told you this company has three engines to drive it, and I always said that even when one of the divisions or one of the engines is facing some headwinds, the others can make it up and move it faster. MENA is doing extremely well, and obviously we have big ambitions for the MENA to continue.

Injectables, as you see, as we said, we have stabilized the business, and Rx is delivering very good margins compared to what it was just a few years ago. These are the background.

Again, I think we should always remember this is a company that has three businesses, and if you look at historically, we've always had one of the businesses push the company forward if the others were lagging behind. If you look at the CAGR of the last 10 years, and of course the first six half of this year, you will see that every year there has been growth both in sales and in profitability.

I think CAGR for the last 10 years was 8% for sales and 6% or 5% for profitability. We hope to start driving the Injectables business next year to start growing the profitability, top line and bottom line there, as we continue to move the other divisions forward.

With that, Areb is here with me also, and we are ready to take your questions. James, go ahead.

If you could just wait for a microphone and then please introduce yourself. James.

James, yes please.

James Gordon from Barclays, and thanks for taking the two questions. The first question was on the Branded business, in terms of phasing.

You had a strong H1 both on the top line and the margin, and I think for the full year, you said you'll be at the better end on the top line. How much of the H1 strength was this one-off factor or the phasing factor, and also how much of the costs?

What would H1 look like on a clean basis, how much more cautious do we need to be about H2? That would be the first question, please.

Then the second question was Generics. I think although you've reiterated the guidance overall, I think the margin before was around 20% and it's now approaching 20%.

What if anything has changed there, and is that a big difference or just a minor difference, please?

You want to take the MENA? Yes, go ahead.

In terms of sales, James, this is the normal trend that we see every year. There is a trend in tender business, there was many tender businesses delivered in the first half in terms of sales.

Also, we've seen some good demand, especially at the beginning of the war, some governments started to stock up, although we see this has normalized at the end of H1. Also importantly, we had many sales and marketing events and expenses that were either intentionally postponed due to the situation, or we had to postpone them because there was limitations on the travel, etc.

We will see those events happening in the second half.

Are you able to quantify those at all to help us model it? Are you able to say broadly how significant those are if we're trying to do a clean model for H2?

I would say H1 would be 50% 55% weighted in terms of sales, and more weighted towards EBIT in the second half.

Obviously we're also taking consideration that things haven't settled down yet and there's a lot of uncertainty in the region, which historically has been helpful to Hikma, but it's wise to be careful about the plan for the second half. The Rx division, as you know we said that we would push the margins to where they are now.

Sodium oxybate has done very very well. We've seen a little more competition for generic Advair, but we also, as we have said before, we do have big plans for CMO.

We see CMO business picking up there, any kind of headwinds that let's say sodium oxybate will face will be picked up by the CMO business.

Thank you.

Hello, Zain Ebrahim from J.P. Morgan.

Thanks for taking the questions. First question is on TAVNEOS.

If you could provide us maybe a bit more color on how that's performing relative to your expectations. I think you said that 80% of ready customers have now switched or partially switched onto TAVNEOS.

How does that compare versus your expectations at the start of this year, and what underpins your confidence in an acceleration in the second half of this year for TAVNEOS and into 2027? That's the first question.

Second question is on Rx launches. I think you've had quite a strong launch so far with tapentadol.

More broadly, are there any other launches that we should be excited about in the next 12 to 18 months, and what's the latest on epinephrine nasal spray filing?

Okay. For TAVNEOS, it takes a long time for the formularies of the different buying groups to take it on, and even after they say we will, it takes some time for the different hospitals to start stocking and using it.

We have been seeing a pickup month by month, and we feel very comfortable that for the second half of this year that we will continue seeing this increase month by month. I think the last three months of this year should be very indicative, to give us a full idea of how it will be doing next year.

Many of the hospital groups that we were trying to get them to take the product have taken it, we will be seeing the benefit of that. The second question was...

Rx. Tapentadol, and Rx.

Tapentadol is going very well. The authorized generic on that, and it's just been a good launch.

I think more broadly, the question was around launches, the launch environment, and then actually that then probably goes into Epi nasal and nasal.

Yeah. For the Epi, the submission has been done.

We're waiting obviously for the FDA to accept the submission, and that would give us a clear idea when we get the approval. In the meantime, we have approved the plan for the product.

Obviously, it needs major investment in promotion and hiring people and so on, we will begin this as soon as the FDA accepts the submission.

Giang, and then Beatrice.

Hi, good morning. Giang Nguyen from Citi, I have two questions please.

The first one is in terms of the US Generics Injectables business outside TAVNEOS, could you give some comments on how the rest of the business has been trending, and especially what are you seeing in terms of momentum carrying into the second half of the year? My second question is looking at your full-year guidance which you have reiterated, clearly first-half performance has been very good not only in Branded, but also the margins that you have got in Injectables and Rx despite all the increased investment, etc.

What would you want to see to be able to increase the guidance for the year? Thank you.

Yeah. As we said, a lot of work has been put into stabilizing the business, in hiring people across all levels, actually it's not just senior people, but across all levels, including operators for the plants, bringing in the equipment, making sure the bottlenecks are taken care of.

We've invested heavily in supply chain, both internally and we brought in external consultants to help us. We are seeing, actually we are seeing that we have now, as we say, safety stocks.

We haven't had safety stocks for a long time. These are very important because they give us the ability to react to the market when there's a need, when there's a shortage, and obviously it's much more profitable selling those.

We have then started building up the safety stock. I believe that all these measures that we are taking, increasing the number of units that we are manufacturing.

We've always had an issue of supplying the market, it hasn't been an issue of demand, now I think we have much better supply for the market. In terms of R&D expenditure for the Injectables business, there is a huge increase there.

We have a big team in Croatia, and we have been giving that team everything they need in terms of personnel, in terms of equipment, or whatever they need, trying to expedite things, move them as fast as possible for the submissions. I don't know how many submissions, we have given out any numbers...

In the second half.

We will be seeing an acceleration of submissions there, and clearly those submissions will be driving business 2028 and further. We're very optimistic about the future of the Injectables business.

Beatrice.

Hi, Beatrice Pepin from Berenberg. Thank you for taking my questions.

Essentially, I had a couple on the kind of CMO business. You noted that you expect CMO revenues to pick up in H2 for Injectables.

Could you just clarify what level of visibility you have on this? Then on the Hikma Rx segment, the CMO side, you've obviously got your target out there for 20% CMO revenue contribution by 2030 for the segment.

Could you give an update on where you're tracking relative to that and what level of visibility you have? Then just a quick one on cost inflation.

You noted you absorbed the cost impact in H1. What cost impact do you expect from inflation in H2, and what's looking for the ramp?

Thank you.

In terms of inflation, we've been able to absorb all the inflation that we faced so far. The team has been doing really great in navigating all the cost increases, and this is evident by the margins that we have, and we believe we will be able to continue to absorbing the inflation in the second half.

In terms of the CMO Rx, we're trending well. We're doing good in terms of the plan, and we will start commercializing next year for the CMO.

In terms of the target that we set, we still feel comfortable that we can achieve 20% of the Rx revenue from CMO by 2030. As we've talked about some of the contracts that we've won, but we continue to talk to new partners, sign new agreements.

We are gradually [coughs] building that business. Again,

there's a lot of demand. We're talking to many companies about that, and there has been some serious investment in the Columbus plant and serious expansion that is coming on board.

As that comes, we will be able to take care of more of that business. We still are very optimistic.

That's actually the only thing that we still haven't done from all what we said is hire a top CMO commercial guy. We're still very much looking for that and we hope to have that filled before the end of the year.

In terms of the confidence in Injectables CMO in the second half, it will be similar to last year. Last year we had indicated that the CMO would come largely in the second half, that's really down to the timing of when we decide to fulfill those orders, and so we will see that come in the second half.

We have good visibility, but as we said at the beginning of the year, the CMO will be slightly lower this year than it was last year. Nothing has changed there.

We're going to go to Victor, and then Christian.

Great, thank you very much for taking my question. Victor Floch, BNP Paribas.

Maybe two questions on my end. One on potentially US tariffs, and one on midterm targets.

On potential US tariffs, you were quite keen to highlight your continued ambition to invest into your US capacity a few weeks ago. I was just wondering whether you've spoken with the US administration since then.

One of your competitors, Sandoz, has been arguing yesterday that this tariff represented actually an opportunity for them, even though they don't have local capacity in the US. Just interesting to get your take on that.

Does it change anything in your strategy? If you have any feedback from the US administration would be nice.

A second one on midterm targets, looks like the business is doing well and looks pretty much in track to deliver the guidance for this year, but we still lack midterm targets. I was just wondering, what do you still need to see before being able to set up new midterm targets?

Is it about capacity, business trends, just help us understand the key moving parts there. Thank you very much.

Do you want to take the tariffs, and Areb, you can take the midterm guidance? On tariffs, we are one of the largest domestic manufacturers for generics in the US, we feel that we are in a very strong position.

We have invested a lot over the years in our US manufacturing and we continue to invest in US manufacturing. We feel that we have a strong position.

We have very good relationships with legislators in the US. We are in Washington very often, and we believe very strongly in building strong domestic manufacturing in the US, we do think that we are well-positioned there.

The majority of the products that we sell in the US are made in the US.

Rx is almost 100% made 90% in the US. For Injectables, obviously we are increasing capacity in Cherry Hill, and we said in 2028 the Bedford plant will come on, which is purely Injectables, also will increase the capacity.

When you think about it seriously, I don't think there is any country in the world that taxes imported pharmaceuticals and so on, tariffs is something that we've heard a lot, but we haven't seen, and I really doubt that we will see it. This is my personal view.

As Said and Susan said, we have the foundation in the US, we invested in the US, we're committed to invest in the US. There is really no change to our strategy, we're already committed.

Plus maybe, Said, you can mention a few words about our commitment to Ohio also state, and we got some incentives.

Yes, we have met with the development agencies in Ohio state. I was there a few months ago and I met with the Governor of Ohio, and they are very pleased with the amount of investment that we are making both in manufacturing and R&D, and we have committed that we will continue the expansion there.

We received $50 million of incentives from the state of Ohio. That will be something like $5 million over 10 years, $5 million every year up to $50 million.

This is the first time we do this kind of, let's say PR and working with the states, but I believe that Hikma, because it has such a big made in the USA footprint, we have been invited actually to Washington, we've been invited to the White House. I think we work with the committees there regarding pharmaceuticals made in the USA.

Our profile has really been significantly, let's say, more emphasis on that. Actually I joke, I was the first Jordanian was given the Global Entry visa to the US, and the ex-Secretary of what was her name, the one of Homeland Security, she actually came to Jordan personally to give me the big thing in Jordan.

It's just a way to show that Hikma's profile has really been much more now important than before. Obviously, also the very important news we had was the case.

Sam's here with us, the Amarin case, where rarely have you seen all the Supreme Court vote in the same way, so that was also a big win for us and a big win also was good for our reputation, but it was a big win for obviously for the whole generic industry.

In terms of the midterm guidance, we want to focus on current year, we want to deliver on the current year, and we want to keep investing in the R&D and fixing the foundation in terms of our commercial capabilities. No change.

Again,

the drivers for growth, it's very simple. We always say it's not rocket science.

Having the manufacturing machine being well established and having well-balanced lines, and we have worked very, very hard on that. We have given supply chain, we said last year we had $90 million of products slow-moving inventory, which we don't want to repeat at all.

If we just do the normal, $40 million of those would have been profits. We want to make sure we don't have a repetition of that, supply chain, as I said, we have been working internally and externally on improving that, and we see big improvement and that will be very helpful.

Having the safety stocks will be very helpful. R&D, we are putting a lot of emphasis, a lot of effort there, both in terms of bringing in the right number of scientists and the right qualified scientists, which we have done, I believe we are very well there.

Again, we will be seeing how fast the submissions will be accepted. All these things will be indicators of when and how fast the business will start growing fast again.

Finally is acquisitions. I think we have to be a bit more aggressive in acquisitions.

In Europe, I think there are a lot of opportunities for company acquisitions. The US is still very difficult, but in Europe there is a lot of opportunity for company acquisitions.

In the USA, we should be more focused on product acquisitions, especially for the specialty part of the business, the promotion. We have invested significantly in the promotion team, and TAVNEOS is just the first of those products, ready-to-use.

We want to also enhance that with other products. These three things together will be the engines of growth.

That's for the US and the Injectables. The MENA, we always underestimate the MENA.

The team is doing simply superb there. I keep meeting people everywhere and wherever I go in the MENA and say, "Oh, we're using this product of Hikma, it's amazing.

We're using that product." They have been launching products in almost every category, and in oncology, we have become the number one oncology in the MENA, both in terms of the products we manufacture and the products that we're licensing in.

The profile of the company there is really fantastic, and the MENA itself is growing very fast. Do we have any information how fast the MENA is growing?

The MENA is growing very fast. Saudi Arabia is growing very fast, Algeria is growing very fast, Egypt is growing very fast.

We are very well positioned to capitalize on that and to continue to grow the MENA. The Rx, as we said before, we believe the engine for growth obviously will be R&D like epinephrine and products like that, but also the CMO, as we said, will be a major part of that business.

Very good. Now we're going to go to the line before we take second questions.

Thanks. Christian Glennie with Stifel.

The first one would be, actually come back to an earlier question around guidance. To understand the weighting here, you talked about on the revenue side, 2% to 4% full year, you're already at 4% for this half.

Talked about it being slightly second half weighted. Similarly on operating profit, you did $405 million in the first half, you talked about it being broadly equal weighted across the year.

You've maintained your guidance at the 2% to 4% on the top line, and you've maintained your $720 million to $770 million. What is it that kind of implies that you're tracking well ahead of that.

Is it a question of being prudent at this point, maybe in the context of what happened previously, or is there other things to be aware of particularly in the second half?

I think we've been very clear that investment will continue. A lot of investment will continue.

R&D investment in the second half will be higher, promotion investment in the MENA will be higher. We still have, as I said, a few more high-profile people that we need to add to the business.

We feel that all these things that we need to do this and they will sort of weigh down. I think, again the business is doing well, things are moving in the right direction, and that's why we feel very strong to reiterate the guidance.

As I said before, we also feel very strong that the Injectables engine will start to grow starting next year, we hope significantly.

Thank you. Then the follow-up would be sort of touch on capital allocation, particularly so 503B, you talked about divesting that in last time we spoke.

I think sounded like there was quite a bit of interest, there was some sort of tangible thing, any update on that process? Then as it relates to what you just said around opportunities that may be in Europe, what sort of things might be incremental to your business in Europe just so we have an idea of what sort of things you're looking at?

In

the past, let me again talk a little bit about more Europe. We have manufacturing in Portugal and that's where we have been really investing the most, right?

We're expanding continuously. Then we have manufacturing in Italy and Germany, which somehow we haven't been really investing in because we were always thinking that eventually we will be closing those down and moving things over.

The reality is we are finding out that both those sites are extremely important for Hikma. We had the full European team come visit us a little while ago.

We sat with them for about a week, and they're extremely excited, they feel that there's a lot more that we can do just by expanding manufacturing capacity, by expanding our footprint. We have taken decisions to go ahead and expand as fast as we can in Germany and Italy, update the equipment, some of the equipment is a bit older, updating the equipment, expanding there.

We feel that that by itself will help us grow significantly. We've also now said for the BD team and MA team, don't just look for Injectables, let's look for, could be ophthalmics, could be ointment, could be some other things that we can add to expand, because we feel Europe would be easier, you will not have the US in Europe.

It's less there, we believe and because we don't have other products, it's easier to do these things. As I said, in the US it will be probably more of product acquisitions, but also there are opportunities for doing things like animal health or ophthalmics or whatever also in the USA.

Europe, expansion will be a big driver of that. The demand is there, the profitability has been much, much better than we expected before.

We see a lot of countries there adopt that it's not just prices that you want to look at, we look at prices, we look at quality, we look at history of delivery. All these things are coming into play, so as I said, we are now the fourth largest company in Injectables, and that's why we feel emboldened that maybe we should be not just Injectables in Europe, but to go into other opportunities there.

To add to Said also point, we're also expanding in different markets as well, we're expanding in France and Spain. Those are still new opportunities, but they have really good growth.

503B, when we started, we believed this was a good strategic fit, but we realized that this was a distraction for the rest of the team and was really a small contributor. Actually it was loss making so far, we thought we want really the Injectables team to focus.

This was part of the priorities that Said had to review at the beginning of the year and look into what improvements we can make to the Injectables process as a whole.

Compounding in the US, you really have two two providers. You have the smaller pharmacies, and we have seen actually the FDA has given them more authority to compound the peptides now and so on.

Then you have the bigger companies. When we first started, the regulations were much less, or at least the FDA had not been very involved in regulating that market.

Since we started, it just happened the timing, they have become much more active and the FDA is still trying to figure out how they're regulating. You have seen a lot of warning letters go out, you have seen a lot of companies had to shut down or are not doing well, and really the overall, let's say, big market of compounding hasn't really materialized.

We figured that we would need to invest a lot of money, it would be very distracting. We thought we'd be better off concentrating on the businesses that we have, especially since we know that by investing more in our manufacturing capacities and bringing in obviously that Bedford plant will be very important.

That's why we sort of said let's give it up.

In terms of execution, it's according to the plan. We're unwinding the business, and it's up for sale, and we see good interest as well in terms of selling the business to other parties.

We're just going to go to the line now. I think we have at least one question there, I'll hand over to the operator and then we can come back to the room.

Morning, guys. To be honest, most has been answered, but just a quick follow-up on the Injectables second-half ramp.

I'm just wondering how much of that is dependent on sort of TAVNEOS conversion versus sort of improvement in the broader underlying Injectables business? Then just on the CMO side, how has that pipeline of sort of potential opportunities changed over the last maybe six months, particularly given growing interest in US manufacturing capacity?

Thanks.

Again, as we said for TAVNEOS, there's been a lot of hospital buying groups adopting the product, taking it on instead of the older product. There was still a significant amount of supply of the ready-to-use Vanco that obviously the hospitals had to use, and that's why we see the ramp up is going up now month by month, but we are much more optimistic that towards the last quarter of this year, we will be seeing some big strides as the new hospitals, the new buying groups that have been converted will start using the TAVNEOS.

Again, I think by October, November, we will have a much clearer idea of how fast and how big the product will be, but we obviously are extremely optimistic. We have invested significantly in the marketing and sales team there.

I think a year ago, we're talking about three or four people, now we're probably talking about over a dozen people working there. We have brought in a new head of marketing and promotion, head of commercial for that team.

We've done a lot to make things go in the right direction, and obviously we feel very comfortable that we will achieve that. In terms of CMO, again, we have CMO for the two businesses, for the Sterile and for the Rx.

The Rx, we said that there are a lot of demand. Actually, for both business there's a lot of demand, it's really a question of our capacity and how fast we can be able to take in those.

We do have, I think, significant CMO for the Injectables scheduled for the second half of this year.

Thank you.

Good morning, thank you. Sorry to labor the point and return to the guidance and the second-half weighting, but there is a clear statement that says revenue and operating profit are weighted to the second half in the release.

Certainly I thought I heard Said about the second half additional cost in R&D. What is it that I'm missing about the not even moving to the upper end of guidance on core operating profit for the full year?

Thank you.

I think it's best to take it segment by segment, to be honest. For the Rx segment, we feel very comfortable that we should see a broadly similar performance in H2 versus H1.

The Branded is what we've said, even if you go to the top end of the range for Branded, that does mean that it is much lower in terms of revenue and operating profit in the second half of the year. Then that's offset by the increase in revenue and operating profit in the Injectables.

On balance, it's going to be for the group, I guess, a slightly lower second half primarily because of the Branded business and the very strong weighting of operating profit for Branded in H1 versus H2.

Also let's bear in mind on MENA and Branded, the situation in MENA is unstable and there's a war going on there. We prefer to be cautious as well on our projections throughout the H2.

Understood, thank you.

James.

Thanks. James from Barclays.

Maybe just to follow on to your comment there, which would be I noted the comment about being cautious on H2 because of the situation in the MENA region, but so far it sounds like at least for Hikma's business, it hasn't actually been a bad thing because actually there's been some extra sales and less spending. What is it that could be bad for Hikma's business as a result of this situation in the second half?

We said that usually when there is uncertainty, there's a lot of stockpiling. Stockpiling means that will take time for it to be used.

The stockpiling has been made, clearly that kind of sales will not happen in the second half, and then you need to use the stockpiles. There's always the issue of currency stability, there's always the issue of supply chain disruption.

It's, again, it's...

Uncertain.

Really uncertainty. The uncertainty, it's tough to plan.

Tough to plan for that.

We've been in this region for four decades, and I think we're really well positioned compared to all our competitors to capture any opportunities, and we've seen this in H1.

So... I really think that the big issue is the stockpiling.

Governments were buying a lot of... Plus,

bear in mind that we're going to also spend more in H2 for the future growth as well. That's the balance between H1.

Then

can you quantify the stockpiling a bit so that we can try and model that properly?

As I said in the beginning, we saw stockpiling at the beginning of the war in Q1, but we saw this normalized towards the end of H1. I wouldn't really put so much weight on the stockpiling, but our tender business is always H1 weighted, and the historical trend of our sales are always H1

weighted. Could do better, of course.

Obviously we would like it to do better.

Thank you. Giang from Citi, and I have maybe two follow-up questions.

One is a small follow-up point on the compounding business. Is there a timeline that you could communicate to us as to when you're looking to wrap up?

In relation to that, I think previously the guidance for other was to break even, and now with the compounding business being unwound, are we looking at better than break even for the year? That's the first question.

Then the second question is in terms of buyback, you have made significant progress. Would you rule out further buyback this year, or do you need any further board authorization if you want to continue for a new program?

Thank you.

The buyback is almost finished. I think there's very little, probably $20 million or something like that left, $230 million have been, the buyback is almost done.

I think so far we've acquired about 11 million shares in the buyback.

Close, yeah. 11.2 11.

It's almost done. I think for this year that's that.

Obviously, the issue of the buyback every two years, there is a revision. We take a look at that and see, but we'll take that when it comes.

The compounding, we are in discussions for somebody to take it over. It should be fairly soon.

It should be soon. We've classified this as held for sale in the financials, which means We expect it to be sold within 12 months, but we expect this to be much sooner.

Keep in mind, it was always put along the others when it came to sales. It wasn't put under anything else.

On the others, you're right. I think but I wouldn't allocate so much profit, but we'll make profit in the other segment.

Thank you. Chris Richardson from Jefferies.

Just a quick one again on the Branded margin. As you mentioned, there is quite a material fall-off in the second half, and even though there was a similar H1 weighting at top line in 2025, the margin stayed relatively sort of even.

How should we think about sort of mid-teens as an exit rate into 2027 if financials were sort of S&M, or sales and marketing expenses is staying relatively consistent H2 versus H1? How is that fall-off happening and how should we think about it progressing into the midterm?

Yeah. Margins for the Branded, as we continue to adopt more advanced products, the margins are better, but keep in mind that most of those products are under license.

I think the margins we've achieved this year, we are at what? Almost 30, they're quite high.

Clearly we would like them to stay there. Do I think there's a scope for improving?

I don't think so because, as I said, the more products that you license, the margins there will be around that. The business is growing and it's growing very nicely, I believe that for the next few years, it will continue to outperform and will continue to do extremely well.

A mid to high single-digit top-line growth rate with mid-20s margin for that business is sustainable.

Yeah.

Zain Ebrahim from J.P. Morgan.

Thanks for taking the follow-ups. First follow-up is just on price erosion, just if you could comment on what level of price erosion you saw in the Injectables business and in the Rx business in the first half, and how we should expect that to develop going forward.

For the Injectables, I think the FDA is being a lot tougher. They are really ramping up their inspections and they are sort of enforcing new regulations and new requirements that is forcing everybody to be levelheaded when it comes to pricing.

We haven't seen significant price erosion. I think for us, it's a question of ramping up our production capabilities.

As I said, the demand is there, and for the last few months, we really missed out on the opportunities, the shortages and so on because we didn't have. By doing that, the safety stocks will help us tremendously because they open opportunity, and it will open up the opportunity for us to do more CMO.

Again, there is a lot of demand to do CMO in the United States obviously, but also in Portugal there's demand, by increasing capacity, it will help us. For the Rx, the oral part of the Rx, I think everybody is suffering.

There is still erosion.

There's price

erosion.

It's probably mid-single digits, which is what we usually have.

Our sales are becoming more and more inhalation, nasals, and so on, which are suffering much less than the solid dosage, orals.

Makes sense. Then the other question was a follow-up on CMO.

You've said that the Rx, I think there's going to be quite a significant contribution next year from the contract that you have, which sounds like it's ramping up well. How should we think about Injectables CMO next year, given that you had the headwind from losing one of the big contracts at the end of last year and now you have that capacity available and you mentioned the strong demand?

Could we see you potentially backfill some of that capacity as early as next year, or might it take a bit longer depending on tech transfer times?

I think we'll be seeing some increase in CMO next year, but obviously the major increase will come when we have the Bedford plant operation, which will be in 2028.

Thank you.

One last question. Christian.

Christian Glennie with Stifel. Thanks for the follow-up.

Maybe just check in on that large Rx CMO contract in terms of the status of that product, if you can say, and also a bit more sense for the 2027 potential tailwind or benefit from it if you can articulate that a little bit more, that'd be helpful.

The things are on track. We have done a lot of work in terms of the preparation in 2026, and as a result, we've generated good service revenues for that contract.

That meant that, as expected, we're seeing a step up from 2025 in terms of the contribution from that contract. We do expect that in 2027, we'll have a full year of commercial production from that contract.

I would say it's going well.

I'd like to come to your question, Zhang. We guided towards a break even, and we still expect it to break even.

The 503B was really a small contributor to it.

Thank you very much.

Thank you. Thank you, everybody.