ANIP - Earnings call transcript Q2 2020 | ANI Pharmaceuticals, Inc.

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Operator

Good morning, everyone, and welcome to ANI's Second Quarter 2020 Earnings Conference Call. [Operator Instructions] Please note this call may be recorded. It is now my pleasure to turn today's program over to Lisa Wilson, Investor Relations for ANI Pharmaceuticals. Ms. Wilson, please go ahead.

Lisa Wilson

Christy. you, Thank Pharmaceuticals ANI Earnings Call. Results Welcome QX to XXXX In-Site Relations for This is Investor of Wilson Lisa ANI. Communications, Officer Stephen me With on Chief and and today's Walsh, Financial Carey, Patrick Interim call President Executive Chief of ANI. are Officer;

can through Investors call at section of website the ANI access webcast the You also anipharmaceuticals.com. this the of

performance in and started, considered Private expectation, disclaims in our like are on events specifically statements to for are get call forward-looking that defined Securities XX company's projection, conference regarding today's anticipation the Such express to everyone of obligation intent release by that anipharmaceuticals.com. as results webcast may Litigation information from uncertainties, statements and press available be ANI except the morning differ future Actual to will as issued we ANI statements on law. Before belief, may with filings forward-looking on today The and remind performance. statements. I forward-looking would the be risks those our required statements, materially including forward-looking by a projected noted forecast, and Pharmaceuticals our any days SEC. website, or not management Reform the made of guarantees as any this forward-looking Act. these archived those based involve update or intent future statements available These future

SEC the with on so Walsh. webcast, company's related turn replay call announcements And ANI For the reference August topics have then, archived to Since and releases recent who the over press discussed, benefit XXXX. I'll may or listening to those call be Patrick and most the X, filings. was of this that, the may to held please recorded made

Patrick Walsh

and personal today. Thank you, our and all and employees It express and an of our our my contract everyone, of patients to us. ability in dedicated appreciation morning, you COVID-XX supply has call on thank altered and to for caregivers. our I'd personally impact Lisa. lives like has to has continue joining manufacturing our pandemic The industry. network affected critical medicines had for Good

off a facilities challenges. dampening business, felt products the to kept perform including events In pandemic-related drugs, our proud both physician lower in is our employees first tirelessly said, COVID. effects, which adapting manufacturing continuous keep well, second the our brief broader our with course, overview the supply continued to hospital across due ANI admissions country. have ANI of me ways prescription the second pharmaceutical declining headwinds. demand medicines, we've Let overall we our start We've are And business open, the and of levels and to through for worked experienced our industry while quarter, visits, lower reflecting at quarter albeit the safe. way depressed That managed we of ensuring these those to have and of

activity begin levels this While we to pre-COVID assuming some patient-physician of resumption anticipate quarter, is of weakness rebound that persist third not of per earnings to second non-GAAP a net of significant adjusted XXXX of $XX.X share quarter second COVID. revenues $X.XX. there's adjusted diluted of and EBITDA year-end, into will our portfolio by the wave reported and million normal likely to non-GAAP $XX.X do million, We

annual manufactured This is our manufactured contract previously site. Canada at approximately site. $XX an product product, Canada this June, Oakville, also product we of this We managed Capsules. the ANI our The for $X for Tablets we year, U.S. the for launch our market is portfolio. about million, $XX this Mexiletine was commercial Hydrochloride acquired quarter, at U.S. generic announced expand In market for early During Fluconazole million. client, annual Oakville, million. a product of sixth our the second to and continued first The launch is product

Let collaboration resubmit In consulting to the a our me assessment. Cortrophin application working this firm, the FDA. am prominent a we sNDA now to the to to taking comprehensive I right and made and with gap are Gel team the we we in steps turn completed construct people on parallel, changes submission. that confident leadership to project, we In place a have significant robust

With than first for the have And we assessment. time to in was comparability prioritize confident remediated clarity XXXX. I analytical completing to bolster remaining Our sNDA identified, path no which any to established resubmit of data been our the of of step have lines product. gap QX later our on any greater legacy additional majority deficiencies am we including the drug already can in forward, the tasks,

is our filing. about the team of our Importantly, confident quality

delighted delivered announced record specialty product strategy career, earlier development industry of and President September as this be of our Cipla CEO a Nikhil and Chief effective Executive welcome depth we are results ANI. track where has in and throughout strategic to The and growth acquisitions, pharma, most he his are our we new confident breadth He's executing pharmaceutical that X. proven at experience in generics recently and as week, commercialization. Lalwani As spans USA, he his will planning, instrumental Officer,

as We President of commercial in Pharmaceutical. experience. deep President a pharmaceutical chain of well our Tony Executive experience. goals. our Par and of generic of strengthen pharma Inc.; and Chief to strategy diversity to and strategy also operations launch, supply marketing company's to three This documented Jeanne track the execute front skill former Collectively, challenges across the reflects representation depth growth further SPI now record just through with race, product desired Pera, Board to set also our and breadth to the the and our Thoma, sales our adds successful commitment in pharmaceutical of background addition and as manage aligns experience two strong ethnicity capability gender. and Tony's Directors, Pharma, individuals these of on achieve acquisitions Board's talented brings director executives in business to and announced the further Officer Jeanne and

benefit agency shareholder our our investors, the customers, we communications patients healthcare-focused outreach and program constituents, other and overhauled and manage for website recently our to of Finally, with Investor investors. engaged a key Relations

turn Before over the about commercial is this words just call Amerigen It largest in few financials, to to date portfolio recently I past review the a January. acquisition say the has late-stage our ANI's completed to to acquisition Steve pipeline. I generic increased and want

quarter advance to CFO, with of Stephen acquired pipeline the are ahead the will date, pleased in numerous Carey, continue to over the products second Steve? the to discuss the which now running transaction. We our performance and Amerigen portfolio of expectations, to call we I is results. turn our

Lisa Wilson

million Pat, decreases million, the year pharmaceutical driven revenues principally Net This $XX.X products Net prior for call. were compared were will On XXXX industrywide revenues and quarter, overall revenues the pandemic. product Vancomycin tempered in XXXX. products I from the declines to for $X.X focus industrywide the or XXXX. from in XX% down on significant of Vancomycin morning This an declines same second and by XXXX on in high-level to Thank branded everyone the levels COVID-XX Amerigen total morning, compares period X% XXXX million and the comments pharmaceutical net X%. for January launch Net solution. generic period the basis, second million decline generic a $XX.X million down the $XX.X activity by prescription by EEMT, Ezetimibe-Simvastatin, EES, of $XX for from during good in quarter prescriptions resulting of addition of September were you, oral second the to quarter. same driven year-over-year in were during portfolio the for quarter the

arrangements. to million fair inventory Our cost of cost in due quarter depreciation subject excluding increased acquisition, for of in million to to with acquired $XX.X the of by excess Amerigen the sales, over the cost $X.X second million sales, products of value coupled in an of sales and increase XXXX $X.X representing primarily amortization, in profit-sharing

of development the percentage million $X.X in as impact, a million million the increased related XX% related quarter in of research expense quarter decrease project. to the accounting second of of restructuring Excluding XXXX XXXX team. same severance Research to impact from internal in the to $XXX,XXX cost in compared revenues XXXX. development in period with of increased and a expense million and net quarter second recommercialization Cortrophin the primarily of during associated $X expenses tempered nonrecurrence in second Amerigen Pharmaceuticals and to of XX% $X.X the Coeptis from Cortrophin of to of the XXXX $X.X quarter the The due of expense by these the sales was acquired second in-process to items of

continue second expense, quarter as rights rose costs our of $XX.X incurred primarily departure amortization the increase quarter termination in the due the the comparable related to general to during Application. million the will quarter to currently of which resubmission Excluding in XXXX second XXXX anticipate of million that as first half Drug administrative the Cortrophin-related supplemental to half we of that we compared were of expenses XXXX. in severance the approximate New advance the in for search a Amerigen. R&D and benefit The quarter and to XXXX CEO to related $XX.X expenses our Selling, comparable XXXX amortization million of related incremental million CEO. in million compared XXXX the second $X.X new acquired to of January to product to in $XX.X $X.X increased of from reflects XXXX and the costs former Depreciation in the

prelaunch was net Cortrophin year prior There $X.XX inventories, Adjusted Net $X.X the the of and down XXXX in period. the million of are second million prior quarter was commercial quarter to GAAP. EBITDA $X.X for per U.S. year XXXX. revenues $XX.X no of expensed profit. incurred for of as corresponding million per principally period. gross million the build net compared loss $XX.X second which year comparable of of XXXX the second was diluted of the million as share income Diluted due also was the in $X.X for to compared in such prior reduction non-GAAP activities in from to earnings quarter share We in loss $X.XX

of release, the this in year period. As the is non-GAAP morning's $X.XX earnings our quarter prior compared per as adjusted press diluted detailed on to Table share $X.XX for four

balance date, As sheet we and of of cash $XX.X equivalents. cash had million unrestricted the

XXXX, associated is cash $X.X times million and Our of operating compared XX of of of borrowings revolver trailing as the during March a $XXX quarter net year. is June the This from $XXX.X as Amerigen of reflective figure million represents XX, leverage debt of of acquisition. cash net balance net to of $XX.X the this decreased XX-month flow million basis. Total activities as on to million QX with repayment from X.X

continue be will suggest XXXX optimistic disruption the that Presuming regarding aligned nationwide internal of stronger further half business, the the compared more evolving is no patient-physician while that financial suspend activity, and second we of which we pandemic, trends we believe the a performance. of the would half COVID-XX for to COVID-XX in with there XXXX. uncertainties half to to inherent Finally, guidance first remain light second meaningfully as our second forecast financial improve half

indicator, levels. internal pre-COVID As indicate relatively July were in an initial factory sales expectations a line and with to our return our

Pat been in further opportunities. as to selectively forward invest $XX and mentioned, pursue open Operator, initial this, Currently, portion flexibility to with levels continue credit call business acquired we provides operations with will of cash this look second expect from we of questions. performance us development the please of opportunities. allocation revolver to ahead. $XX.X now of generate addition, XXXX. our these continuing undrawn facility have the in go for product and remains I Amerigen capital and positive transactions million In from continuing half healthy to we flow of With assets in the development pleased From very the a year, standpoint, the earlier maximize to business million

Operator

of your And Instructions] [Operator Folkes Brandon is Cantor from first question Fitzgerald.

Brandon Folkes

taking questions. for thanks Hi, my

any And Can can meeting some So strategy? to a your strategy provide yet a confidence little lastly, maybe the Sounds like possible expect on just bit have from then forgo acquired strategy. launch more is on this And we but A Cortrophin? Tobin decision what Amerigen the about you of color just acquisition gave Type just first, secondly, to take you it that you to Should color on just And transaction? the talk there? additional quantify it, forward? strategy? with you ANDAs to more the going benefits previously

Patrick Walsh

Type This first the take if Pat Steve, about I forgoing I question can can of want, is take, you the meeting. the A Walsh.

to the we to us go pretty leading was provided FDA quite back And two the it has needed the looked feel with agency to to two leading The clear at the When us information do. meetings the again. of really clearly upfront. didn't to simple. Refusal or So expected the you up up and been to data File, was what interactions ask

like at done. this, to needed the we getting we what work when be to we to resources external on applied looked the want felt plan knew and game internal and So that

we and feel XX% refile items the in either As can over well analysis previous line assessment mentioned, that described. forward of correspondence identified, team's the we time complete the as go with or within very we're the to gap confident

in opportunities. look and market we're at you maybe continue the that transaction? want regarding you status, place In opportunities. terms to we'll the look of aggressively to other looking the the now digest acquisition for. rich here to Steve, other The kind if consolidating there's of think, a Amerigen solid I can team the right in I When handle is think acquire continue at question assets

environment have our of all industry. for ability three be it particular whether scale sectors, to fact, contract target-rich I've this services. or the in a never all more we branded, generics of In And seen the

about So Steve, want for acquisition pretty do Amerigen question? to the feel I you positive additional opportunities the take targets.

Steve Carey

slightly It's ownership Yes, the and sales solidly actual been and terms transaction generic portfolio, I sure, we portfolio. been six of diversifying figures sure. for the mentioned, tracking Amerigen has our profit months. a for expectations you don't gross ahead Brandon, to But of know, in and our that performance of of the Pat. our both as expectations sales great first portfolio. first Yes, the in as specifically to months the so Pat our speak six quantifying the Thanks,

develop directionally, look this forward the that pipeline a point the in XX handful to in introducing to commercial think time, future. added it's products portfolio. to good products And or approximately we and I at have XX in of we we the continue

we've tuck-in at and time date. So the pleased to company, very for transaction a it was the right nice been

completed activities terms quarter. operational that first over was need of switching the and sales of in in all marketing, that occur chain of largely etc., All supply to ownership, management, the

so year to we prescription strength to the COVID-XX the half to declines speaking, occurred destocking the were the in the quarter, leverage second look but quarter. full ANI the that of just we Unfortunately, And more full of see able of activity total broadly upon the the in backdrop that second Amerigen during and forward based portfolio. the

Brandon Folkes

you thank right, much. All very

Steve Carey

you. Thank

Operator

from Flanders of is Dana question Guggenheim. next Our

Dana Flanders

deficiencies mentioned on for much you in consulting your detail just what strengthening the filing? And My first any more Great, provide just of Amerigen on And back one nature is identified? Cortrophin, you you color some And what would the a you so questioning, color stronger doing? from And but is a piece here I think with you is. were you what a you there I can thank plan portfolio on provide of helpful. you the about data remarks, Was half. would on imagine then, FDA that of a on provide. requested? little your that that very it questions. second just you're analytical launches the organic were just to noticed appreciate and that COVID, said how were any are data any work done the prepared And how that? thinking line more ex driving Can some I Steve, color be what's bounce in

Patrick Walsh

your requested added to information the you're around derived by process was of was To almost specifics revolving assessment done when to most controls, to leadership encompass do of further like and product been the has is chemistry, the application, any on the could answer regarding CMC you what's submission what's no. which that That that bolster manufacturing what the the Dana, data going regarding the question at to or been section we our manufacturing-related the for this. see think to for bolster, of your question called File to would the Refusal look I team's analytical answer FDA, application. from a analytical

that's from we application And obviously well. going It any standpoint, effort. keep public the our is that interactions to a So do the majority standpoint. we haven't spent with FDA, quiet that with ongoing gone detail. where while from the want your we'd as you also, and are Obviously, of time really competitive not

we'll would I've comfortable with personally there's FDA. you an amount team. a type application I We've hired and with of and this involved So tell of put that have to the group, products who's very that work significant progress. in the been significant in a outstanding prominent described, process been we on very had forward a as these feel experience

Stephen Carey

on questions. question, a your And Dana, inputs the thank the and Yes, you half. second stronger answer Great. few to second for

by of piece calls, strength operating a the destocking by you're be of year-over-year year, non-COVID-XX driven a in client for the script foundational out driven XX% X% the and the scripts industry we all at IMS versus sure, on generics second prior When a framed calls and right? decline total hearing were or about of second pharma So, quarter for as softness as quarter just the it's would in in whether brands, data look backdrop activities, for your year-over-year. it, portfolio for type decline down

upon we to look the the And in patient-physician If second terms is of so the throughout terms no biggest course our on plan half there's fourth that. fact quarters our activity, that And disruption or launched well, stronger the ball softness it in quarter product, sequential what obviously, of essentially oral was built is top guidance the product always delivering in that the be of withdrawn, based before which which of of going the that solution line back the by second would And of no there's that the crystal factor And of quarter. we presume our of driven Vancomycin in to launches the then XXXX. uptake to was bring. top less disruption single and and biggest continued growth you previous layer was upon operating was XXXX. was just

that in indication in is the second the did of Now being out favorable in product comps, which folks hospital. quarter that it our particular, for year-over-year comes out largely product, diff, was a back as called in is C. get set main as while the

market outsized second And folks so as an elective the in kind quarter the of took step pushed off Vancomycin procedures. backwards

of gains second procedures sequential to elective normal, the to to So, etc. a that leg And in clearly, assumption that organic products hits again as well And half EES those three start portfolio. see took and returns your lap return we on big question that an second driven think look year activity the Ezetimibe-Simvastatin, we to then post competitive the start product talked hits, will had as about the normal, EEMT, we you with that I continues. half, competitive to third last

losses So around the year. of occurred Ezetimibe-Simvastatin last mid-year

start that bit the we'll quarter little third So in of XXXX. impact quarter the quarter, lapping beginning later, kind we're and and fourth of of kind EES a of was of third end

lap comps X. was And of So quarter. the the the those in latest fourth EEMT we'll

to to get start improve relative year prior those compared performance as see the you'll mirror. rearview So impacts comps as start in further to

Patrick Walsh

seen reset surgery the in in a that just, buying major the in traditional bit time Steve's within usage to the alternate network. and quarter industry. start with to the in site point, ANI. load. some hospital simply site And It did board. alternate variations see pharmaceutical July, a in was one to major down entire centers, a being, drop across and there We you I've never in inventory little pull-through normal drug further It in a optimism. were my distribution more the of in Dana, back industry across were us behavior. hearing we're is There management career, obviously significant and to that a wasn't volume alterations little as phenomenon that for starting closed return know, The a such here And and recently. to I've certainly, a gives been

optimistic the more a unusual a has that's this to quarter So a say least. very on why basis, just little been very, go-forward we're but

Operator

the We any this further or for time. questions closing have turn call remarks. Pat Walsh back at to I no over will additional

Patrick Walsh

welcome and and Well, for future. really of we to on certainly, with growth thank new value and demand, Jeanne and our an all as our heard, Nikhil I'm lives, the new achieve pandemic's feel assets ANI Tony, We everybody us, to professionally. own and full drive who And and and the Board the operate grow we has our help we sure look expand affected we time doubt to CEO of today. continue no to impact our continue optimistic personally Directors, your and business. forward Despite our of us and you've COVID-XX business,

thank So with company. call, the of you support we close and that, your we'll for our

Stephen Carey

you. Thank

Lisa Wilson

you. Thank

Operator

conference This call. does conclude XXXX ANI's second quarter earnings

your a disconnect may at You day. this time wonderful lines have and

ANI Pharmaceuticals (ANIP) 9 Aug 202020 Q2 Earnings call transcript