OPCH - Earnings call transcript Q2 2024 | Option Care Health, Inc.

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Operator

Good day, and thank you for standing by. Welcome to the Option Care Health Second Quarter 2024 Earnings Conference Call. [Operator Instructions]. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions]. today's being that advised be conference recorded. is Please hand over Maggio, to would Vice now first conference to like Nicole I your the speaker of Finance. President Senior today, ahead. Please go

Nicole Maggio

expectations. will materially uncertainties Please Form forward-looking forward-looking the subject include differ our do that as required results statements our assumptions release We including specific financial are We our expectations, statements, except that with to information in actual as well the related you to any uncertainties. and morning. to encourage review latest and not performance Good today's filed and current certain statements today's undertake as industry could XX-K that XX-Q regarding note law. and cause press forward-looking in by from reflect to Form any SEC future our duty the and those risks risks update discussion and market to conditions. These

talking use During company's this will financial we performance call, measures non-GAAP about and the condition. when financial

You of Executive additional posted Relations John call Chief morning's to Investor this on that, the non-GAAP press portion these can over measures information website. will turn release With Rademacher, I the find Officer. our in on

John Rademacher

Nicole, and good morning, everyone. Thanks,

ecosystem the another of was our most The second midst putting we disruptive history pressure call, business. that Health supply we're challenging attacks managing Option in the chain dynamics. On last and number one of on despite Care cyber quarter the quarter productive a for team our of through the care disruptions health number were of a on in

Growth first the continues from our portfolio. Throughout rare challenges. has made saw exiting limited momentum in to across quarter, pleased through the therapies Building XX.X%. within As team upon to the from as significant balanced the the and I the we managing sit portfolio. am robust with today, consistent first team's well chronic especially orphan team of newer processes. Mike referral new distribution was line quarter, first that Health the the here In more and with we of the progress Care did And top the perform year-over-year always. workarounds face second growth growth challenge financials and these related perspective in recovering team delivered as report our the the than adversity, mix quarter. the patients developed supply well to and provide half, Change the impact Healthcare modified will in rose profit never incident chain innovative the granular to on to Option gross the as more sources the disrupted. as collaborate service onboard and But to remediation lingering revenue ability existing and challenges efforts the with

attack. I'm margin to generate our disruptions procurement we every quarter did $XX previous pleased given $XX we that identified dropped of the for inputs sourcing with the therapeutic that cyber call, million the to first second leverage expense quarter quarter the fight incremental in to approximately And adjusted relative and our quarter we first million continue EBITDA efficiency line. On point. basis and However, gross we Change the challenges operational the strategies. challenges with in in resolved alternative and impact including sourcing the to were our enterprise X significant affecting second the the later comments, Healthcare of key report consistent mindset,

applications across utilize cycle alternative their various we applications critical key and Regarding with we tools our service the operations support in patient administration effectively connectivity for situation, established management. change health providers care reestablished and with or of have revenue relationships

in quarter, largely online tools back strong we have efforts. earlier primary With the in our these progress made second recovery

we area delayed. still said pay This and in operationally, we expect be there the But revenue our inefficiencies have tremendous to an as receivable and continues quarter. be some collections the posted flow modest to see our you'll of our monetizing statement, substantially accounts have patient in be the we complete that, of be as made from we remediated cash to advanced recovery. focus, functionality the third have around quarter been and Some recovered. Having revenue have receivables continues in we and to progress some cycle reducing

As Mike flow repurchased of efforts given around on upon, will building the the generation stock cash $XX strength reengaged capital quarter. balance sheet, deployment million the progress of the in expand and and we approximately

or regularly mitigate the quickly efforts to direct test of ability well as is key reaffirms risks as to response manage the adeptly to and first of a and invest continue Change information in robust Healthcare identify, and respond to ability to to critical such maintain our enterprise our in management result assess risk half process, our procurement and Our which the the internal dynamics risks the challenges these effectively cyberattack organization well and management emergence strong technology need our develop to functions. coordinated, risk responses. The multifunctional as

our effort believe enables myriad with engage the other a I shareholder active investment investor better and maintained through community During with conferences and venues. Feedback to enterprise. manage interaction the is of the we and invaluable, to second us our quarter, base

One cost advanced, an care an provide to want view been clinically attractive operate of ecosystem, high-quality enterprise. I a of around this therapeutic care. minutes how at setting reiterate a would the area the health in of the growth of given I that key to I advancements. areas where broader appropriate profile the in few receive in face care take we patients we our of their believe growth thought interest has profile we

our shifts merger the delivered as headwinds intravenous in [ BIJUVA of XX% on is mature, or of dozens decline. We year, more BioScrip and sources and revenue much new therapies also rare drugs, slower-growing in north quarter as individual antibiotics one This such across the top to strengths. with The is and our we exposure enables better therapies referral believe Our comprised us line several base ranges XXXX spectrum in categories broader of than prescribing and patients have of base categories. From and therapeutic through such from our average hundreds helps growing with of rapidly which patterns. breadth a to ] some key declines diversified therapeutic this of some despite growing collaborate payers XX% mitigate growth. in to therapies is first significant of

within more number ] XX%. branded ] were when for horizon, over For [ we drop launched antibiotic time example, generic a one more prices was of REMICADE, antibiotics therapy as for significant a reference Cubicin, [ that biosimilars that than the and declined prices portfolio ] of than and XX%. [ saw reference and daptomycin drug our last which

which and of our therapy ALS oral revenue rapidly therapeutic we attractive a Radicava, despite last As we've for beginning to that year, and base for was these shared infused platform late continue of top demonstrated declined XXXX. Yet, growth. strength our deliver novel other in line the developments, and therapy when all

portfolio, monitor Our new of our additional and be product new and prepare we will infused therapies all team introduced, biosimilar formulations never receive administration. We forms constantly indications. of may entrants, existing to efforts for introductions know rests therapeutic and refine see subcutaneous will in their or broader therapies that products

these medium trajectory our are perspective regarding into the term. our As are incorporated identified, over top line developments they

to we pipeline, we on prescribers remain risks We opportunities and platform we pharma more enterprise. growth see a the that opportunities we as have demand believe we look provides our capitalize position drug as for growth at As capture and of the conviction extraordinary steadfast continue this regarding unique and and the to in patients. our payers, strength drive patients, value will manufacturers, to serve market well

resilient or no pricing strategies, including platform they on and is horizon. unfold. out payer to market standard respond script generic team demonstrated every best As to therapeutic for variables, past, control. But developments we And Every unfortunately, negatively. are strategies pharma certainty every we of look and evolution, there enterprise will of introduction, is channel to as dynamics unique. our the will many forward, positively as pharma we have rebating biosimilar we prioritization the label see change and and how strong therapeutic a the they a we these do adoption And our number or in respond provider to the or impact our dynamics, have of frankly a

we into expect to the we this patient heading half year. the the that, team prouder on deliver the I'll of midway over is revised as guidance second And morning, despite another commitments in the enterprise challenges today be provided could based Health strong of hand not call for of to provided Care The on and I well positioned here we So half. growth. our through sit the With care Mike. first level XXXX, Mike? the of Option year

Michael Shapiro

portfolios we or under and that last the more and from for $XX solid quarter launched distribution across Revenue quarter accelerated Thanks, X. Gross to results. the therapies rare in new considerable growth therapies grew the procurement when X% see John. $XXX prior million quarter have benefits QX transitory normalizing prior Good growth our versus and approximately million over first orphan included of year to the $X profit the acute chronic XX.X% million everyone. limited mature off We drove momentum. the morning, in of in year just second contribution continue and of year second

with in and was lowest share earned dropped share record. Adjusted I'll EBITDA our the to $XXX.X by quarter represented spiked $XXX the up second we reduced the discussed in quarter second situation. the profit health drugs flat considerable in efficiencies As in significant Healthcare in over situation, pharmacy to $X.XX in share in in and we quarter, upon call, is quite for changed first the $XXX the quarter, chain excellence. pleased we affected quarter million progress the per revenue as quarter articulated the repurchase great supply care operations We benefited receivable at SG&A believe investments as cash in are we to from call and from the operational to minute. Cash late the chain we which expected, from be and recovery have and to in in of as $XX through John our in per touch generated first percent efforts of sequentially a end inputs gross almost of was quarter and of challenges the changed expectations as million health that we the rebounded quarter. challenges quarter quarter. Consistent by first XX.X%, the technology which flow due a as another quarter. the drive his first million inefficiencies impacted million care quarter accounts comments, ratio flow well resolved revenue. Earnings And the which our and second story effectively X.X% in the than as on on more the continued situation. supply mentioned the made outstanding certain the SG&A operations led Change on efforts. We have recovering with continued

flow of and As cash sit recovered at working from in is back under the would we capital it be here course. levered. back net Xx in we the the And today, the where our end situation has position ordinary to are debt expect we comfortably with quarter, second effectively line

various the to at strategic situation, capital the opportunities. our care engagements we recovered few As would efforts reaffirmed quarter we efforts. To deployment assess changed on M&A flows the investor and articulated that focused remain events and cash first end, on health and as on continue call months, over from acquisition we past reengage

activities We stock of the on repurchased and million in repurchase have $XX quarter. also share second reengaged approximately

momentum of ramped stock. and to deploying repurchase capital focused M&A year-to-date, have repurchased efforts flows cash cash And on in improved strategies. the quarter, we the million than our more up we flow through given generation, share and intend remain as $XXX in Our

to half $X.XX billion. billion Finally, revised based the our and $X.XX we revenue increasing are on results for our expectations to year the expectations, first

to raised million and have our now to EBITDA generate for end $XXX flow We continue to bottom we'll generate operations. questions. from $XXX than for the the And in to we the cash million with that, expect expectations more $XXX open and million call adjusted of expect year Operator?

Operator

[Operator Instructions].

comes Gill JPMorgan. Our of first from the Lisa of line question

Lisa Gill

to secondly, we about then the mix chronic as biosimilars. therapeutic the in quarter? think talk I just environment was just about understand want you Mike, what comments about John's better versus with acute? First, shifting Can and I think can And the start

Care. Option why As generics when think think similar about margin do biosimilars? they about we And think we traditionally have a I impact a margins? for about being much better would not How

Michael Shapiro

question. Mix mechanics At over John, want address second revenue portfolio. the of for around quarter, X/X if least, and with chronic start to hand was of Yes. second the our some comprised right was you of it your the I'll in it

growth about, that continues makes to we've talked right on So roughly sense outpace cohort XX, around the acute because of XX, therapies as which side.

John Rademacher

into of Yes. hard to move. to lot bit going biosimilars are enter it comments, my how marketplace. And exactly a depends many A on predict things little Lisa, to how the

margin We better everything called we're make kind there's acquisition it we biosimilar the more a we as see, revenue forward negotiate for as entered ] out time remarks, do a to of talked that we are event be normally of in goods certain products. REMICADE, prepared As event on than for those took we've the on move better as cost of marketplace with at into in the saw cost the [ and manufacturers normally products more with the events can look to competition to marketplace that that. dollar to about positioned publicly biosimilar. We able

negotiating as variables I remarks. that as the lot you why And look that, to the to expansion for a to for product. as opportunity the call biosimilars So percentage we're there tried within we've of and able on costs a basis the that's looking that's to out level know. margin dollars acquisition there's better the But what uncertainty to is of that with prepared some margin in and historical that of a trying of at hold on been do

Lisa Gill

your And follow-up just then, to about John, of as uses talked a remarks, prepared you cash.

stock about now a maybe mentioned you little but market target share are you right in what you're back from the the repurchase on the thinking how a And as environment. you about to perspective? also you that Can talked M&A? just seeing bit You versus year-to-date, touch that bought

Michael Shapiro

M&A we're talked to early to terms as continue Yes. Look, our so we in of on I'll for we're Look, jump to creation. Look, to that a the ability starting Lisa, speak, added capital as maybe about, said, arrow different we shareholder focus in activities. value thrilled in deploy the we allocation. on 'XX, quiver, capital going in

represent I as and assets very proactive a discussions. we strategic small corporate to both on the are We're waiting economic in lives is think this for of process. street, think there and everybody know number find a development having We value intriguing not like a that say, neighborhood. that we we those that we're

that continuing sheet that we're we've of and supportive pursue our under activities. we can Given the profile now sheet, think to the both strength a balance well we got continue look, Xx improve very to leverage balance levered and

for look we'll the forward while So to anticipate expectation investments. I that think should M&A be and try obviously continue needs capital to

think capital expect to I you us that well. see as to should continuing also deploy through share repurchase

Lisa Gill

congrats Okay. Great. on Well, the quarter.

Operator

line JMP. Our of the next come Citizens will question Constantine Davides from of

Constantine Davides

or can clinical a around you SG&A in maybe on kind margins? been management or of the Just if a on where guys of drag possible, box And Mike, of steps maybe bit technology standpoint terms maybe there? taking wondering on neutralize Some efforts little processes. the front, on just a to are you you're can it's you what the put revenue of impact from change just consolidated expand that's cost

John Rademacher

a it to picture Yes, the certainly its's and to try that. question, to with Mike start of kind turn then John. broader for Constantine. I'll Thanks box

cycle on just behind first go out have to year, call did in really also the remarks, of claims back in where prepared that talked of I our revenue have collections. I as solutions done the by as have validate some lot with focusing we'll to not do we going team more submit some end ability towards some be and we registration to that was out forward are order and done. we end work the earnings probably as pay great process. We as would quarter measure by call, every in called about the work to to effects of the on necessary had posting patient to online, the turn to we to work called still certify now quarter system that out quarter management in we're to augment the We're there ready So ahead only patient be that alternative collect cash the not as back a the we've third lot to and but through move to we importantly, that. A only need the really the lingering do into our those focus scenes, around of aspects cash of well the reestablish

the going lag of expect, by the was owed would you deductible the As really first that patient. that's to what adjudicated to we because was payers submit had to amount the that and claims get to understand

activity kind of behind we'll the and well momentum but progress So moves continued we the that in quarter as as of third of have feel into now. that and quarter, is bolus the really that of us tremendous the forward, some it quarter we're third in linger

Michael Shapiro

Constantine, impact in challenges, of increase in it's terms impact, number some those Mike. a our of on Yes, the to haven't for actually put because specific despite the largely we year. the look, position we're expectations a

deviate our was And the we've cycle will out therapies the considerably a we ability specific to highly runway automated sure process get into the claims benefits the onboard was with tools the which as revenue so was to sources. That of attributed onboarding margin of range. as make offline. There quickly patient on we're spend in utilize considerably having process of lot talked our door an we're these it's a to that quarter with have gross have dollar as cost referral causing types to onboard a But to call amount. If on responsive out in compounded impact we that, impact of us we indirect shorter. a drop onboard and service, about efficient and patients going primarily disciplined SG&A typically our our well, to well and out larger items efforts fact hampered guidance that our look, efficiently, as within and is registration and to to patients, said verified was

pharmacy were and we much out again, So inefficiencies reiterated as that, John of that. operational there we're pretty some the work think on

And into expense quarter. the expect so going would base a third cleaner we

Constantine Davides

maybe stumbled And might of benefit just referral term other that? one take follow-up. your sort intermediate just sources around with share, longer Any have quick to competitors as standing or ability through term

John Rademacher

when to as both sources into being focus we as through of events. choice well are [ for of to able a overall our events referral ] Constantine, these the Yes. strengthen beef just partner respond to continues

every focus those relationships patients commercial of And we to on referrals trying source. reach developing hustle created and model our of in but as that as our call I I that and able those we've team bringing So will around is and that consistency service of consistency think, positioned. the mean of are really I our a base. teams single earn frequency business. I referral message those always got on goodwill to be board being disruption, reliable this our out take with And of any our to day. well the think well through patients

Operator

comes William from of of Larew line the Our Blair. Matt next question

Matthew Larew

side just cost Maybe on the quickly.

the with deal had in was down a sequentially the flat quarter, SG&A XX% So disruptions year-over-year despite despite growth. identified and you basically revenue and

in of top any the the cost help the of the to equation, into as moving year. and us side I gross side half you're sort think relative maybe growth given growth more guidance actions more plating to about? line we of incoming the about the just recent And of about XX% of think profit from equation? of cost on benefits John's back getting the revenue Just just or think guess comments other costs

Michael Shapiro

looking initiatives And know said and to the cushions. Having great platform. leverageability of we're you think, I our one invest Matt, is preach commercial sofa scalability the every look, The invest scenes. quarter. that, the is culture growth we things coins continue for in in the and the is capabilities we thing in single always the Yes, this of behind obviously,

automation, have for to but that only also the investing of means. deploy platform, growth and prioritize other technology this process are We a as very not ensure disciplined harvesting we and efficiencies we

we is gross invest. curtains, quarter I generated think I bottom comments half that's for why, going back illustrative margin. able continuing the million We almost we're the second that year, the dollar to incremental were the to line. I very to of said, the And into John's behind think dollar like $XX drop around of to look,

a degree will have thesis We high that that, continue. confidence of

while grow spending that's that for And the XX.X%, quarter so think I the guidance, our think level, how to leverage to levels. we I decent the of as at don't line enterprise algorithm percent half, the again, continuing is we individual proxy this give is of going mean, I into a second key a spending we drive revenue. back view as

Matthew Larew

continue There on the the Okay. comment and circle of I I'll in John. year. And maybe growth that's been that back a record proved think number the going back profile. to biologics half year-to-date, of to

growth of home. If I digits. I payers sort home of so higher Because John's do take is typically, really double-digit of time comments comments? reading company. growth that care sustainably modeling more market making market? the reengagement shifted forces public should higher in the to be that I high more to, make you underlying or about delivered mean, alluded view you in kind competitive guided are I you this think some had have a be position single Your I what to the the my market we a take maybe would the guess mean your some preference mean, as COVID should you've are John that competitive? you up [indiscernible] that But in a post as future? in I you up,

John Rademacher

Yes, Matt.

mid-single-digit range. et have couple the studies, insights growing that in cetera, industry from infusion a is we to of that we expect So From things. be home that going best

we've we platform and being not the competencies, drugs investments we've use the consistently all for U.S. the population into our portfolio, that in hundreds of reach direction. We and position to said, certainly of the the clinical opportunity of on of part our and are overall focus only look the therapeutic ability moving we've As as they're but drugs bring got around got And of of that try every the not categories, the to a ability I value dozens have that same and XX% limited proposition part that to to we distribution made. marketplace. capitalize

these around of going takes We unknowns going prescribing there's lot and patterns of be to a are practice and expect puts the move There that to physicians loud new heard they're our responding some if and move from inclined clear indication. of that a is to well therapy patient on, a them forward. prescribing we've that the they're are onto not physicians to

So moves as we we're to payers, sources on and every as it we're that take to to to for expectations competition cetera. that is be this have, to develops of of try advantage a our organization. we're kind for the et outhustling we the the going our referral build commercial of moves forward, And continue partner team continue and -- choice that going of momentum

I market So given in probably on be think, normally that the around our is is kind all expect focus our single focus to marketplace to that that execute. where energy. high that the beat we we mid-single we expect would growing and would those into the things, be kind put said, that our that it we in of which that, that digits, be beating ability we should But band digits to able we've would I expectations fit of to into that

Operator

comes next of the question from David line Our of MacDonald Truist.

David MacDonald

want I timing the make just I sure to quick got couple of questions. A right. Mike,

of the quarter. supply wasn't that Is end Is that I correct? the guys on absorbed said the So chain the resolved until drag through you timing? think entire correct quarter. you that that

Michael Shapiro

innings. part. an There most in the later was Yes, absolutely the impact quarter second for

David MacDonald

the it you the Mike, us Okay. of bit. the single a expect? then, that? strength bit guess of digit of kind we think installed I that line of acute what kind if and into that we the kind was just a with low the the pushed higher backwards of do and When top pull growth, the Just little low chronic, And can little any line there? then digit kind growing additional double help we about And then [indiscernible] that math just apart really detail maybe top

Michael Shapiro

Yes.

] within you range, hand think I Dave. [ grenade

with more look, the growth therapies think, expect. line generally come to profile the in I more the more that were we've established

I really we back the year. if think line folks guidance double-digit to that guiding top think initial you single-digit, were low our high -- and range, to for

I today those. in is we're novel, mentioned, the think delta and LDDs between as We delivering to those generally the of some newer were still frankly, orphans, range year. and the the of going rare some that due John into where commercializing where,

So That margin obviously it heard on again, you've event time margin impact because gross rate it's higher impact mid-single-digit has as attractive, rate. margin call we time is much that the at comes what conservative were the have that but rate, depressed, the but with a revenue rate. more on a the does Which, revenue reach that, and so dollars and on still are expectations. I'll of an again. performance us upfront, lot over

David MacDonald

single-digit road? there guess we then more any years think how X business much chronic not X And think When the quickly this I as just SG&A and down the high about to that's a is last patient characteristics about couple. of to business reason growing,

Michael Shapiro

look, there's High expect mean, be percent toggle a that because a of southward. to denominator drive ASPs -- our SG&A would extent, out that to -- SG&A control as I of single-digit drift continue some is absolutely will drugs we're of the to continue leverage revenue, the but yes. to revenue going fast percent to I leverage. as it's of absolutely How going

David MacDonald

terms just to state how the was mature you there. I in your are just just Okay. It of now many highest And suites. feels are ask what of kind wanted one, lift close infusion have last to on then, some in suites. efficiency nursing guys, steady quickly of utilizing like got seeing out most pretty you or guys wondering

Michael Shapiro

that to efficiency. of great our events In And them the operational suites. We favorable are patient us the be we're quarter, all we nursing them. conveniently of continues lever in this we located approaching drive quite again, XX% don't found to one aware a Look, Yes. force occurring patients And for suites. of into those. of make our is in our of experience frankly,

really As started right we you remember, coast-to-coast. about expansion XXX now shares strategy, suite and our infusion we're

earlier north those of to pays the avoiding drops and utilities efficiencies tranches, concurrent than XX% about productivity, for from able cost drive clinical infusion a savings for and event. XX% improvement in nurse nursing seeing time we're more For that windshield which we that the are

vital but it as to it think so margins, b, creating which our growth. more nurse helps XX% And capacity, obviously we it's is of almost fuel continued

Operator

line of comes question Chickering Bank. next Deutsche the Pito of from Our

Pito Chickering

you of any growth, at first the implied color with high on procurement single-digit modeling there Looking modeling year. new versus benefits. or And us year the in the gross Is you're we're the the anything give that? wrong excluding of growth in profit dollar guidance, half back half if how can

Michael Shapiro

Obviously, but it's I number minutes improvement how over as is comes we where proxy little prior it's a incremental tougher P&L we've of maximizing the way the on a don't Again, Pete, specific the a think up year pieces Again, that guidance Mike. moving of across that frankly of of comment some the is little the we I deliver go side to high years. for a performance half couple the I kind with gross and a previous and relative my that's margin normalizing kind got not individual XX%, half can second us platform. $XX about with dollar on of kind generating degree procurement benefits, the which back of the quarter, Pito, with of provide lines, ago, to first through you that's obviously, And confidence, thinking. Look, in have of second leverage coming What dollars. incremental margin dissimilar to we in us think QX a million think we're you tough normalized of think quarter the of creates saw of gross margin a the saying comp. plus to the base. Back the which the growing we couple comps the gross talked, year? versus bit isn't we're sequential

Pito Chickering

with about that the gross intellectually? single or there dollars is we're excluding if maybe wrong in thinking But procurement, profit ballpark, digit, that's anything Right. high

Michael Shapiro

generally think the I in it's ballpark.

Pito Chickering

Perfect. right. All

for impact biosimilars. of impact about, come script, lot from where And there's you So obviously, like this. the of concern a XXXX your a for talked the lot

is couple give when gross all of as color look of it's profit class think biosimilars. Is changed? any years, you per ballpark? that's you what there today of Is and us how last are script under of brand had the on sort If versus I If that you've the the move at down XX% from can about into in sort we drugs the where that the that brand.

Michael Shapiro

the to of adoption, over events. say, approaching and his The script. I our comments, the lot had pricing I'll are few lot a channel in Pito, only some out mentioned completely it and is There it, thing and biosimilar generic hand around We've is it no as channel A quite control. manufacturers of John. would of John of how

isn't pursuant of is the And margin any percent I folks our some biosimilar will provide number tried of going the It it's or remarks we a that out ASP question last has the control. prescribed dollars a months. just so prepared of this x after because really know There that plus to couple to to where over be depends, pathway variables and been minus. constant are and frankly third are compress and

John Rademacher

of that the new existing that the some we is even when some of I'd are move do have But we awareness is the come new that only well within with the biosimilars. of a entering We The introduction as some see in. thing portfolio and from are add, marketplace products what branded see Pito, that of products introduction, other entering as we the see products, those into with that. the let's campaigns lift

campaigns to that with the the of benefits of happen are well. new awareness kind and be and that products to those as formulary And that. dollars So lot there's well that a opportunity dispense portfolio our as existing into the bring that product advertisement in as able

to that make They've we with manufacturers. decline basis And So negotiate can all very tried has respond little we some to these bit before. a We've either that contextualize moving the organization the the efficiently offset able preserve there. revenue effectively that to around. or way we point of been of are we differently, put the through pieces and some as operated at but some profit every seen to least certain trying

Pito Chickering

and new that future It's of Alzheimer's on [ ] drug segue. quick sort have thoughts around a of follow-up sort impact What you on the Lilly's your could the pipeline?

John Rademacher

and be we're afflicted address pretty continue are some is very Alzheimer's. have amazing. to And that Yes. loved thrilled starting fact again, to that The that cognitive foremost, starting for with one this products that a first therapeutic new again, is entering impairment, are to products category. has that Anyone

to. path We're what's medical view be understanding still very the our payment better until conservative policies adhered have to we'll that we in and the around

As prescription for the infusion how bringing think adoption products Medicare I we're to with the injectable you overseeing active suites well or payers of that partner start [ or as or Medicare Biogen that's really And for our HCP looking to know, think the for anyone choice to banner, in with to a the their is understand associated conversations Lilly fall try the and that. MA elderly for of of be we the both fee-for-service has and forward. positioned the infused for vast with Advantage. We're patterns going to under and our with at or see ] majority this these a sponsors plans capabilities the product. We population

to impact policy. to hard have this so around better have And time continue and going constructive we how get at going to in we're certainty there. that's tell it's path to to payment conversations point really until medical

Operator

line Tanquilut. the of from comes question Brian next Our

Brian Tanquilut

to growth maybe this out I I it morning, next medium without targets year normalized right think look pieces Mike, about the a be to you've as year XXXX, about to as I and out? is think the you've lot a as noise that think about all just should set relative of moving talked that that

Michael Shapiro

Obviously, a around on provide the to developing you answer to starting in fulfilling, We're we'll XXXX be XXXX. granularity thoughts Mike. our not at kick it's on or going share just this just February. expectations, Brian, on which point, that's to to position any I'm in but efforts our call going we're give off our

Brian Tanquilut

maybe on. understand. on discussion And back just the maybe I putting PBM biosimilar hat then your and

the think when profit that value the introduced. perspective, it payer should a good will is that But a from way about, a you and and think ASPs on understand not drug is down dynamic? bring the to right to come to really they the change we you're is dollar gross obviously, that that As table say your biosimilar making much. mean, about that economics I

John Rademacher

always where then I'll the reinforce value are to color. of alternative to and add cost be care. can start looking to delivered. as care can that helping we bring trying reduce Mike total Scott. it's When payers the We the Brian, to in the at they're

of that. We the in the are right cost side equation on quality

they We that, with level are the within no us And that reimbursement. and money And and an trend give that. We of for detail, think expect. there's contribution can that the we of asking think talked had more getting we're to clinical to on that that always don't there have we've the And that so us it that the through total provide rate. about conversations. We've nursing our the value in out. we that care on that, have payer recognition stool -- we associated equation, the and organization. dams but that focus then as as margin to the calling bend in help Being but how would don't constructive a think cost our of per partners our looking the with you of as the one's always legs conversations balance I it's and fact there's I some drug cost competitive. And us X for break of

our Brian, be XX we we're negotiate both all have, in of like our as our fight breadth the that like And to we that portfolio. chronic paid are deliver to part strategy ability and to ourselves we the to in We [indiscernible] to so to of the the acute continue states for going we fact serve and position to comprehensive value we that, for have we're way overall strongly consistently going within that all every always fairly those the have basis point ecosystem. things, and got

Operator

Joanna from comes question Bank next the of Gajuk line America. Our of of

Joanna Gajuk

a So of I here. couple things may guess if follow I up

commentary So head the the right? first, percentages terms on And there But to [indiscernible] margin dollar, said these -- in for either can is clearly, new of the headwind any gross these me therapies, that obviously. are to trajectory. you we

of in distributing. especially X that you therapies now quarters one you've as So these have maybe X or quarters, been

those improving? margin gross on percentages kind closer So percent these kind normalized gross of on on would are of And track you to kind when margin? expect get to of margin you more

Michael Shapiro

how decline. At approach road think prices there some has time articulated, biosimilars that Yes, naturally are will is the a isn't outlined strategies with introduced, perspective, pace. From map. over by Joanna, competitive, do to are margin things I pharma, using biosimilars introduced you're Look, the many kind articulated, those going in a quarters John helps many it a is John should of isn't at completely his pricing have expectation to our lot biosimilar standard rate be the from how has out of for what something way strategies especially not the with can a beholding and reference you that expectation proxies but derisk over that manufacturer, it procurement our as of remarks, strategy, the procurement our tracker it pursue. margin evolves. control that you because strategy what prepared how I multisource because how Again, as one There of procurement a the we

of revenue lower patient event gross the So have perspective. provide retain we time rate again, specific margin typically, as over revenue that to looking a one you're that expands unfortunately that see you for don't per but time, if that from percent we typically erode, a and line,

don't question going answer. Your to an is And have we dollars taking be, are out? where well, the

important think it's efficiency. sometimes proposition still therapies talked lower, what service but to is over John are that a dollars higher. of do I what we're providing are have for regardless -- providers time, underscore payers ASPs the value where Sometimes But the to drives we and to just the which dollars which wrap, about,

care acute the in the an it. being want drug patients said setting, can setting cost in considerably if is an articulate the we payer administered So in or receive to net having a HOPD is lower that, to that where a

dollars are confidence of generate today, to frankly, that which, as be And either proposition. majority to decent of our value drugs gives so able of because us revenue we'll comprised of that our generic today, continue that portfolio, or margins even the biosimilar

Joanna Gajuk

I percentages, the and actually margin think I prior that [indiscernible] margins was ] opposite compressed ramping Viju asking therapies gross time discussion [ but was improved. with initially as the around the been new up the you've they how like guess the I

So event? out some to and therapies without contribution as more kind you the are therapies? should we this was is these expect And like of the like these where year of have XXXX on specifics. trajectory some calling improve then Or asking of actually new margin I in revenues gross it percentage you these

Michael Shapiro

patient have are I therapies is loss. my you are event new typically still rare orphan and clarity, digits. we Yes, high mistake. And these appreciate single Look, therapies, don't launch Again, that commercializing very very Joanna. a have the a attractive. We therapies. new-to-world proven dollars very record typically costly the the track cost LDD because per rate margin of

time, want hurdles and that that we we're a of out covering they're improve those patient not building you you margins service quarters, because patient cohort this and the clinical make over can years, in typically gate, cohort. gradually internal that is build lower And sure we're as have We to model. that

and reengage with clinically. table manufacturer to services bring capabilities can around and the advanced can You things we the

can those margin definitely coin. That's value chronic ahead the story that's on create into And just may back because going lifelong or ones, typically the still the say we going launch say patient perspective. of of of X be are I'd over more so And be that that can you digits typically revenue to up a drive and forward. recent a way basis I service on track rates these single from would the I track again, part a going are to time. high think

Joanna Gajuk

I React. follow-up. another if And may,

I works the you to launched. guess, about channel [indiscernible] that on for formulation. their I guess if something means talking and guess referral a it a preference? we're depends, mentioned subcutaneous the I going they're try all sources And new patient subcutaneous and necessarily the formulations different So But not

are for So I I is existing at early in of then is trying the you're market the or either to particular kind to any the for if your base, one? how even And impacting of your all? this companies, kind And of penetration patient expectation infusion this actively response, what I in subcutaneous? of read guess, kind particular, the pharmaceutical what insurers they that seeing guess, prescribers from from or move drug guess,

John Rademacher

Yes, that. I'll John. respond Joanna, it's to

-- seen is subcutaneous instances, expensive. just in -- shift moving I formulation out. point are a this significant haven't that. In some we time, there's in towards call in we've the the There subcutaneous. patient trying at So been our census more mean a of there's to of lot dimensions

that to given onto it's higher service. So therefore, or payers price that that on necessarily a product onto looking patients aren't the that. move

So in -- census of and those our remained base our patient at things of in has point time, pretty this stable. factor types kind

our seen will for significant instances, of subcu the many of of a from moving products. patient that we though, formulary on subcutaneous. these haven't given part We that it's IV shift the the many to retain In

remained point as consistent within way So the of front see what that early expectations therapy that some that. We're to in and time, looking center always to But the IV consistent trends this our prescribing prescribed the tell on the may they're have at we understand and doses. migration and on are it. the with census the being patterns patient with

Michael Shapiro

[ to oversight. seen add suggest higher certain still of frankly, subcutaneous development sub circumstances, doses. And more IG introduction great some so administration professional use an receive it's a quickly. a prefer look, XX% a the has or given Joanna that, yet patients not health [indiscernible] have more around better patients for example frankly, than it intravenously clinical of for immune care But ] is where Evolution becomes of patients. ] obviously, we decade, been want globulin still You It's all efficient. the for IG [ care because requires it standard therapies their is

it's we an where patients, seen lot have not So But abbreviated time questions again, get some version a the a over care obviously, of frame. we the becomes development. of for short on, great standard

Joanna Gajuk

follow And of the if the I just stays up instances, on with because former. in you that may comment around patient the many

what to impact margin, for happen, the So is if gross on kind that percentages. to guess, -- that I you of was and dollars

still ] but I nursing component, you, to So the what maybe patients cost versus like happens going terms but per happening staying if of these for bill there's help be So for drug, guess still but that still collect switching that infusion. in maybe no to the understand with [ DM. there's of you the was subcu us and

Michael Shapiro

depends really therapy the and It payer Yes. situation. the on

is day we and and we Joanna, the charge care bring the is which clinical as build therapy, we cover provide is a outline for build to pharmacy for a a diem of we've nursing build other tried the folks. drug, we you we per know, I present ] to per the for think, infusion [ model when assets that table. therapy infrastructure to nursing all always Typically, if for

instances, the present nurse is in It's spread on point. Naturally, obviously not cases. reference most in for economics a price we're that. a different. higher There's There's to a making subcutaneous most John's therapy

nursing patients. that infused for So changes it different revenue capacity it's that -- also a event, preserves other but

payers. underwrite it's we approach We different. just accordingly So as

perspective. that we on So that's about all provide the can color

Joanna Gajuk

many question may, you add suites. a quarter around If of last Great. did and this the give I new this you on the the year? sense plans us of kind sir, for follow-up, how Can

Michael Shapiro

think to And about sites we've in have I quarter. the we coast-to-coast. quarter, in the up X XXX we again, we're good the that around added new so very Yes, X feel shares

Operator

line the Petusky from Michael Barrington comes Research. question of next Our of

Michael Petusky

Mike, related just what far, can talked smarter mean about better does it obviously, you expected? the sort so has of so last change, recovery you've of understanding the characterize seen or to that were days you just sort reaffirmed being I you you worse? cadence it? of than cash XX when flow come in guidance. curious, cadence the you Is of I'm as that cash or the flow about

Michael Shapiro

relative Mike. was XX a -- I'm lot ago. where better than feeling days mean, Yes, to whole I I Look,

the to and team. candidly, Resi I hats off think [ ]

probably where I we pleased think think just really, from recovery it's really the with ahead expect to be I circumstances, cap with of bit structure And perspective. the pace of collaboration be. to and given the quarter we where payers a responsive exited a the it

Michael Petusky

And you then you X% sure, on the nursing, and -- for and the then to for sorry, it was? -- make I'm you -- then said quarter was I said X% that first quarter the said half? the what for X X% want Is the

Michael Shapiro

You got it.

Michael Petusky

as think mean, out you term, talk to does on Can that longer can like what in about look X what XX%, look move I X X And that of would years? terms XX%? you X I if success -- mean you Okay. years I mean, I about just [indiscernible]? success out guess, just initiative that to or

Michael Shapiro

Yes.

a I think nonanswer. to give you

chairs nursing XX% be could invest is all suites. we think thing the looks than we've first initiated this we to that is we that, like about to of in add we're When our XX%. infusion have continue to of And was, I great I think the success more obviously. Look, going it and this capacity considerably the network events. question expanded. we've way tremendous The answered think

So patient footprint. can our in events more we existing accommodate significantly

with long as enterprise, value a for significant generating equate think there's considerable the already these year confidence lack just of which we said, don't of runway. slowing opening strategy. We we the in amount of the So added and pace capacity, is a a entering a

we down than drop to be value the it So economic today. utilization where success is to great to XX% doesn't the I to think considerable But have road the is XX% higher enterprise. considerably thing are

Michael Petusky

-- then dial to in try I slightly. want And just to

therapy But around curious, You not. acute. grow quarter and chronic year-over-year or revenue sort of I'm earlier the just did acute commented in

confirm. to Just

Michael Shapiro

did. it Yes,

Michael Petusky

It did? Terrific.

Operator

at time. right. now no like this All closing to it am for I Thank showing turn to I remarks. questions you. back management further would

John Rademacher

and you Thank morning this for in Yes. all call. our joining participating us

at the as disruptions a everyone, and delivering to understand very guides marketplace. We continue important and to patients and the great you, level we second your light in quarter the with productive in role we in significant their this for serve families, was remains that even attendance. day. our care, have and Take more execute very our play high As care us continued to a we that team a XXXX. patients outlined, Thank

Operator

participation your today's program. in for conference. the does you conclude Thank This

may disconnect. You now

Option Care Health (OPCH) 31 Jul 242024 Q2 Earnings call transcript