INVA - Earnings call transcript Q4 2017

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Ladies and gentlemen, good afternoon. At this time, I'd like to welcome everyone to the Innoviva Fourth Quarter 2017 Financial Results Webcast and Conference Call.

During the presentation, all participants will be in a listen-only mode. A question-and-answer session will follow the company’s formal remarks. [Operator Instructions] Today's conference call is being recorded. like Principal the Financial Executive Innoviva. would Eric over Officer I Interim d'Esparbes, Officer now, to call turn to of And and Chief go Please sir. ahead,

Eric d'Esparbes

call, for afternoon, results financial fourth year us. Good thank full the review you and XXXX. and On highlights everyone, from today's of we quarter and will the joining

fourth year Following our Innoviva up and a XXXX. release, press open results issued release of corporate financial for the developments full call on can comments, the we quarter for copy A be the announcing of our will today, questions. and recent press Earlier website. found

we statements remind you regarding Before performance that forward-looking and like events contains future the call started, get future of I'd this to Innoviva. conference

goals, based expectations, statements the statements Future and update statements statements. actual beliefs. These as the and upon Innoviva in plans, to change. forward-looking objectives, from those the Forward-looking results assumes regarding anticipated include company are strategies these projected circumstances company's available and results materially information to other obligation today, could differ and no Innoviva's events statements

SEC. the to filings factors details the results are and could press cause described from in materially Additional information release forward-looking concerning in our the that greater with differ company's statements company's

advise yesterday, can adjusted measures ANORO profitability will cash company, Innoviva through also of Additionally, share non-GAAP strong comparable CEO well successful quarter be to to this financial announced is of reconciliation and shareholders President We by high that has and adjusted in this departure XXXX we share discuss conference resigned confident you of our U.S. and intend successful generation. A the remain results. Aguiar, financial and market and call. financial who don't the per to value found be in press very to to and continuing quarter Innoviva EBITDA earnings measures call. on of matter fourth the directly RELVAR/BREO TRx Also to today that as release. discussed the driven want GAAP Michael positioned our record for fourth deliver in a we had today's most

significantly outperform progress medicines all-time maintenance suffering GSK BREO Our products. BREO, the the growth, for ICS/LABA global year-over-year the ANORO versus treatment to and partnerships for our of the in in for leading market ANORO market make ANORO goal asthma Resulting XX% prescription volume high building the TRELEGY U.S. and towards and COPD. into both both market. X% for patients with to for of and from BREO continue growth In continues X% market new versus share TRx XX% for bronchodilator significant

for BREO QX the XXXX. trends was approximately quarter XXXX, This market. week the versus recent weekly and the ANORO new-to-brand XX, X% grew maintain week ending that which for pulmonologists. which that But and with September market XX.X% market compiled In December XX.X% at same products Of XX.X% remained both XX.X% ending with remains and shows QX most our ending to the for to for period. share plan share remain for reported approximately GSK, grew TRx will we ICS/LABA overall recent work the by We versus market these and for NBRx pulmonologists was their believe a January XX. XXX, XX.X% share IMS, LABA/ICS the compared though, share that position. fourth share during script joined XX%. reached of XX.X% saw We dynamics of by closely for overall formerly IQVIA share continue data market been also by IQVA, very last quarter ANORO the market During third to growth of of strong total XX.X% market, last during favorably compares volume X.X% the result adds over script ANORO, new-to-brand quarter week prior quarter partner, confident that According the pressures, our BREO ANORO BREO a have the to the during note maximize was BREO BREO to and competitive to flat year. the market leading XX week the

the In ended our ICS/LABA of November. the XXXX continued over XXXX portfolio addition, the commercial U.S. in with commercialized products new in of to TRxs TRELEGY therapy launch ELLIPTA, X,XXX U.S. triple with grow in TRELEGY

XXXX, compared reported that of last As BREO RELVAR not XXXX, traditionally periods. reported net we've prior ANORO benefited GSK increase quarter up the fourth quarter-over-quarter fourth experienced is outside XX% had case, third net rebate sales while reported calls, been year. in the and sales during has sales BREO million unfavorable by market the year, $XXX.X during were to XXXX QX prescription trends, mentioned up for from XX% net for on volatility by GSK related of net net stronger an payer In sales to recorded quarter prior million, of from quarter the winter the of of while fourth traditionally U.S. quarter XX%. the sales to $XXX.X U.S. affected fourth were demand. sales as BREO adjustments last related the XXXX, Net the total underlying were of million, quarter in of $XXX.X

for to XX% XX% of XXXX. in with an demand ELLIPTA GSK, $XXX.X Overall, the XXXX fourth quarter November, ANORO, initiated increase potential and BREO In sales of to With GSK collaboration about favorable approximately in remain million period. commercialization additional XXXX of reported of quarter million. optimistic effort $X.X Respimat in compared same the of increase grew quarter TRx XX% close ELLIPTA For TRx sales announced symptomatic the reached a in the for U.S. Stiolto ANORO a fourth million, an quarter by study ANORO our reimbursement fourth U.S. quarter patients a COPD. study market, XXXX fourth competitive the an this from XXXX effective and XXXX. status the scripts, with of $X.X the view during with the we strong approximately positive QX support complement trends, we to data in during fourth the market market. We of products. ANORO of as from were underlying net commercialization comparing the net TRELEGY

announced the November and the of in with for XXXX, new addition, an in ELLIPTA Food COPD. of In supplemental Administration a we Drug for TRELEGY U.S. filing drug expanded application indication the use

results. financial our to Turning

adjusted total, pleased with margin. income million a XXXX, we from achieving during financial for year, the are which in XXXX. million more translated than We in very XX% and $XXX.X royalties generated earned $XXX.X In in strong operations $XXX.X than EBITDA into more our performance in EBITDA million

at confident we've financial last performance. in Looking year, seen the the progress over we remain our

that stock-based $XX.X million a royalties quarter expenses. million compensation earned fourth in of offset and $X.X were $X.X of XX% related million, contest expenses fourth for over $X.X Our in of XXXX operating quarter Royalty for Year-to-date, in total litigation expenses $X.X earned of non-cash were for and costs, were million resulting million litigation XXXX, million for included This operating costs the quarter $XX.X for noncash contents. expenses increase BREO, TRELEGY. XXXX quarter XXXX million. and in $X.X the expenses, from Total proxy which includes million, and proxy the million fourth operating $XX.X includes $X.X the expense. million million revenues of compensation recovery by of in fourth million $X.X amortization net ANORO noncash stock insurance $X.X $X.X

EBITDA compared to XX% flow We $XX.X was increase or $XX.X a fourth quarter of continue fourth was from million, stockholders the $XX.X to for in income quarter generate a $XX.X the Adjusted in or operation of fourth XXXX, cash Income basis from quarter the in in million, in EPS, to operations per fourth XXX% of increase compared million XXXX. fourth XX% increase XXXX was fourth to the to quarter strong our million the XXXX, EPS. of Net of XXXX. the $X.XX million million $X.XX XXXX. basic of quarter quarter compared a Innoviva attributable $XX.X $XX.X

XXXX. approximately XXXX. an costs spite XX% year from was per In associated which For in XXXX, million, reduced by $X.XX incurring litigations, of with proxy the income full EPS $XXX.X of compared our contest increase to share basic operation the

for the execution beginning shares, XXX% with strong our X.X XXXX. of share, $XX.X EPS of was bringing full of common compared profitability increase purchasing We million completed X.X basic gradual at in from our of and $XX.XX year outstanding the of the $X.XX our Our an share or XXXX the a program. result for This for average is per up the growth total at stock the ASR capital share in in in $XX result the the resulting million EPS basic by shares stock million million year annual XXXX, repurchases shares to XXXX, total X% in $X.XX the steady reduction return of price per year. program a of count December at our

We also XXXX. of repaid our million long-term debt $XX.X during

structure, Over quarter. at substantially debt at we net in of reduced million end the from XX, last EBITDA and the with the With a for $XXX.X royalties we resulting million balance Cash, continued twelve ratio $XXX.X financial was of equivalents, months, in net of our GSK X.Xx million strong total and XXXX. $XX.X strong short-term EBITDA, December as to continued investment marketable cash cash reduced more of generated of interest had twelve months optimized the XXXX, debt last and and cash-generating $XXX.X are of a the in adjusted adjusted debt we XXXX believe approximately totaled our we fourth capital a date. level, capacity, to securities as receivables million position reduction costs that of end leverage

of the mention would I tax our to of like assessment December effects XXXX U.S. the preliminary reform. Finally,

see reduction XX%. a rate Innoviva, we to from mainly XX% the impact ongoing, currently due for in the to is expect review regime Although the from tax to corporate new positive tax

are they this strong gains be volumes by the lower a the as once company fully cash taxes and remain of optimistic to prescription are financial our on products, prospects and and remain Assuming we business. paid profile NOLs should In of based to rates our about up the our summary, lead share future utilized. market now,

primary conference for open the company. like about XXXX focus remain And success and now, the the questions. commercial the Our I'd of call of and of the we the in outlook optimistic ask optimization remain rollout to facilitator to will our products, global

Operator

our Deutsche Thank have you, We of will sir. Bank. Instructions] first Esther question from [Operator Rajavelu

Your now line open. is

Esther Rajavelu

on G&A costs. Hi, Eric, had my taking for I you the thank question. one

the So include the incurred litigation that fourth as costs costs D&O in did it for or well? quarter was quarter just recovery, prior

Eric d'Esparbes

quarters. Yeah, for the was prior recovery so

So the the for is D&O whole the total you have works is it mechanisms and way recovery $X.X policy year. basically, certain you million fees, a legal the that under have and

Esther Rajavelu

And the $X.XX then Got G&A it. litigation was in costs expense? any there million

Eric d'Esparbes

minor spending. basically over recall. the if very this No, I just really. All costs not I think, We had by September, were

Esther Rajavelu

it, the okay. have then changes more about entire bit you after questions talk strategy on more Can portfolio the marketing marketing launched? Got strategy little to TRELEGY And for the TRELEGY. I broadly, a was couple a for

Eric d'Esparbes

really I the So we main said think in past two what have things. are

important they patients other this is easier the are the – And part a out doctors, the have think there for – the to to without have last one to – progression through the it to TRELEGY medicines all for to same reason is First it's patient – from they prescribed both devices. a the products to compounds using think to different life nurses visit, we the advantage are comes the as doctor of this because benefit ELLIPTA the regard can the main adjust goes makes as We off, to of their disease the first and just portfolio. compared of for that device. the evolve that strategic

useful. products. far the So past no very think commercial is the The is that's as as presented one we that thing we that change a in COPD understand strategy extremely diverse. we've the There in is for

specifically. to As the patients a set of have on each their appropriate then diverse we've have based symptoms, their symptoms disease, and ability treatment

accordingly. it's and the a planned great is So addition portfolio, strategy and always the is this being we for commercial implemented to think

Esther Rajavelu

the I and queue. you back Thank will jump it. Got in

Eric d'Esparbes

Thank you. Thanks, Esther.

Operator

from Stephen of Stifel. line Thank next Instructions] you. question of comes the [Operator Our Willey

Your line now is open.

Prakhar Verma

you Prakhar the you Hi, sampling launch you going talk current can thank level ANORO? of Eric, see Steve. the couponing you. of And for my Verma BREO It's about and for on with actually changing forward the Thank do with TRELEGY? taking question.

Eric d'Esparbes

So a detail level. of couponing the we give don’t usually

a – very that is However, available. couponing products. we the what view we've is of This respiratory in remain part is said essential today. market, is we their same as and tool that mature an GSK competitive a – past, of is different to for and the the tool essential and have available commercialization the is Couponing set very

increases it. our overtime It's not And couponing of as supportive excellent. coverage it as need frankly, for very your really decrease a several BREO differentiating because products as tends was usually is the ANORO to and we're less anymore increases. good. coverage less you couponing and The coverage So for ago. It's years factor

So it's I couponing an less GSK. say, is but than – before, would for level it was the the important tool way

Prakhar Verma

Okay. you can about you initial physicians Was And talk lastly any that received the among feedback feedback TRELEGY? from taken just for was have physicians?

Eric d'Esparbes

any I too real think it’s have statement. So to early really

As X,XXX U.S. during was scripts the I this I think the mentioned, in quarter.

markets for time what sure, have little have bit I to triple is. in today. But of the to you wait a lot over response we'll think, a see the therapy

of class, of triple is we've what portion to the historically, segment think, that that be tends ICS/LABA COPD in of XX% the about therapy. I explained

and market there, there's a it's So being used. definitely opportunity

hope going triple just our well we having and received it's that to patients bit, wait is the have little so need be can. very conclusions But a reception therapy. really to who for So far we’ll if risk by – that

Prakhar Verma

you. thank right, All

Operator

d'Esparbes. Thank on like now further Mr. no would you. the I Please It to conference back turn phone. we sir. have the go questions ahead, appears to

Eric d'Esparbes

Thank operator. you,

conclude thoughts. like of couple would today, to a I As we provide final our call

have we maximizing to in our performance and First, shareholder our goal recognize strong stockholder financial we value. XXXX, committed remain to of

potential believe value GSK our assets. a respiratory this continuing today. actively much for appreciate The the We you to Thank to collaboration. key very support. our second maximizing teams’ manage is of your joining us is continued commitment efforts We our

Operator

conference today’s for conclude does your you This call. thank We participation.

disconnect. now may You

Innoviva (INVA) 8 Feb 182017 Q4 Earnings call transcript