COLL - Earnings call transcript Q2 2020 | Collegium Pharmaceutical, Inc.

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Operator

Greetings, and welcome to the Collegium Pharmaceuticals Second Quarter 2020 Earnings Conference Call. [Operator Instructions].

As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Alex Dasalla, Manager, Investor Relations and Corporate Communications. Thank you.

begin. may You

Alex Dasalla

Executive Pharmaceutical's Officer. is Collegium Collegium. XXXX Conference Dreyer, our Earnings am Financial our Welcome and Officer; Dasalla, Second Head This Scott Chief Ciaffoni, Joe Alex today Chief for Paul of Call. Brannelly, joined Chief Commercial to our by Quarter Officer; Investor I Relations

made promotional of presented today are is Before we want to we made information call, pursuant any to remind statements to XXXX. harbor the the be and safe begin today's participants that forward-looking that Reform provision none Securities Private the intended Act today of of Litigation

commercialize You without ER franchise; in Nucynta not statements that limitation: the and are involve company's and infringement pandemic; and litigation we forward-looking of and filed and Securities or Exchange may other impact successfully current opioid investigations, including and with COVID-XX the uncertainties, periodic and we Commission. risks Xtampza cautioned future our the risks patent that such prevail in industry the the the may the risks litigation are These significant detailed that expense other incur to risks or and not pertaining reports litigation products. company of may

discussed may from results differ Our future our today. current materially expectations

Our of this earnings press call information. release discussion certain non-GAAP and will include

CEO, collegiumpharma.com. our press Ciaffoni. at turn find will I reconciliations, to Joe website release, earnings corporate now Collegium's can call on You including relevant our non-GAAP the over

Joseph Ciaffoni

testament their for adaptability our versus making in a Good commitment quarter our people Xtampza Collegium strategic and of acquisition, year Alex. a to the resilience you, the thank the and and everyone, impact ER progress results by of Pharmaceutical. strong Thank and the Confirmed second financial transformative delivered you, and and to joining XXXX for operations Collegium afternoon, growth objectives. This us. made Nucynta is

people to ability our supply the differently, been essential to the forced there market. to Although work has and operations has our pandemic no disruption

also have care health providers been able to we and this patients. During time, serve

the most our of employees force our engaging today, and is majority of home on site, interactions. level of office-based field some As of in-person customer are working in

force Although as to levels. quality is steadily the continues of our lag of interactions, customer the pre-COVID it productivity is field improving,

open, paid we up to ER Xtampza were highlights do quarter RX This return not that is on has in-person brand. been at debt; that versus grew began total that We parity Xtampza to impacted national a in first Optum lives. second million patient the quarter Xtampza increase from and states. position position XXXX. cash states second preferred include: visits non-preferred Effective saw which down Business OxyContin. Xtampza moved ER formulary, normal increasing, we July to in increased signs to with the XX, prescriptions XXX,XXX, a remainder XX of being XX% covers the profitability; believe As major the adversely for of as ER's which strengthened formulary infections but many commercial anticipate over is from the momentum XXXX; formulary ER accumulated

our an Nucynta We the one the accepted Orange quarter XX now versus our XXXX I commitment grow, XXXX to for with formulation to commitment thank period And listed X second of recognize my our in unwavering evidence comparison, to diversion estate and real-world XXXX was communities. addition the our XXXX. structure. ER, like not manuscript their to patents management. quest colleagues leader in the in ER the the cost to lives responsible abuse, making publication Xtampza we in and decline ability the describing franchise We for remained difference forward first focus, and slowed adapt to positive Book the patent certain a with the the I in to continued people in become in We their misuse of propel announced patents. in pain Medicine. and appreciate of quarter covering respect ER and has expiry to would same Pain of leverage, of in other of our the pain Xtampza from with organization Xtampza XXXX. strengthen suffering new in and in

COVID-XX, leveraging, For on slowing transformative strategic securing Even our year. and executing of market and the be not our of make will achieving are: the growth cost XXXX, Nucynta be focused necessary our decline the to Pharmaceutical They in midterm Xtampza taking the to remainder of Concurrently, the pathway in leadership; ER to strategy. is track structure; success on we will XXXX. actions organization a Collegium the face priorities. for growing a franchise; prepare growing, XXXX

increase and the accumulate to debt of year. remainder cash the expect pay We profit, down

now we a hand for Paul is Our financially strong the the financials. to to positioned succeed. that over the have the organization will and I people call discussion am happen. healthy, and products, uniquely to I make it important, of confident most

Paul Brannelly

Joe. Thanks, afternoon, everyone. Good

With the our the quarter middle as shows first impact well focus on continued Nucynta financial the acquisition closing in that the is the quarter, of first the the full as this discipline. of acquisition of Nucynta

During $XX.X term cash and the second repaid operations we our $XX.X generated loan. million million in from quarter, of

of an first discount X% for ER is the Total from million quarter XXXX. revenue second XXXX and March $XX.X an million was The million second XX.X% increase XX ER net $XX.X of was product million, to June gross Xtampza the the of balance for cash Our XX balance. to from XX% increase quarter the for the which revenue Xtampza quarter $XX.X increased $XXX.X of XXXX. of from by was quarter.

range X% revenue in XXXX, throughout The XXXX. Nucynta by partially approximately the second decrease the in of to quarter X day. million of XXXX. be year is wholesaler offset prior gross quarter lumpy the from an for in first which of decrease a low discount revenue may to net was of and be As increase inventory was XX% the is discussed $XX.X Nucynta calls, expected on for

royalty product year. revenue. intangible the of for $XX.X on a cost year, a of This to Grunenthal which Nucynta of expenses is this of first the million revenues were decrease total from this Operating approximately asset, second revenue. X% million is $XX.X of quarter were the quarter Nucynta amortization XX% quarter XX% second for XXXX, which of includes Excluding the

Our the GAAP net for quarter was $X.X loss million to income year the compared $X.X net second for GAAP quarter. a XXXX million of of prior

for million second adjusted non-GAAP year income compared of was quarter. quarter the Our million prior $X.X $XX.X to XXXX the for

to we are basis. our and know, you historical guidance a practice on annual As quarterly provide is updating committed to guidance, not

in and given in impact COVID-XX, the business, our in market uncertainty XXXX of However, earnings we we have the visibility potential the was light to reaffirming that call. our our due on are QX provided the of guidance

the of $XXX $XXX million revenue the adjusted includes year we've towards for $XXX the now range expect hand term compensation million the making million. at $XXX we million. of in range We XXXX commercial to financially end Scott of cash, transformative expect substantial million. expenses least progress repaying over will call through million And Midway in to Xtampza stock-based in to in to in our range of for a $XXX $XXX million of update. XXXX, made while to million the the notes. with million a ER operating $XXX $XX.X Nucynta income Total of $XXX million, million. range Non-GAAP to revenue expense $XXX $XX which approximately I Collegium. year

Scott Dreyer

for ER of XX% share versus prescriptions, the highs prescriber. market the COVID-XX XX.X% having XXXX. in in was XXXX. Xtampza total to grew per end prescribing the in ER made priorities share XXXX Total XX,XXX market within market base a quarter. quarter, ER Xtampza and per and In an second oxycodone growing prescriber. accounts we prescribers our XX.X% XXX,XXX, share unique ER for the of from of the quarter the second Paul. baseline achieved Xtampza prescriptions stable slowing ER oxycodone second progression the decline up and high X% with of quarter first market we The to franchise. total quarter, versus Xtampza XX to share total as pandemic, for We adapted exclusive up from at all-time in progress Nucynta grew XX% Thanks, saw quarter, up commercial June, XX% extended-release prescriptions first all-time prescriptions grew Xtampza of achieved and second to the the of against ER the of

We ER exited an had of and first Xtampza growing significant of decrease in doctors expect of in continued with the Nucynta franchise the decline market XXXX significant second total our impact share in growth representatives ER a the had for in X.X%, X.X% point X.X% customers. XXXX. in-office to within and sequential business exclusive patients straight five now quarter our to making live market or are XX% the COVID-XX decline has grew reference, of ways: Nucynta accounts. branded as share prescriptions visits XXX,XXX quarters. And their has representing improvement the OER accounts. sales accessibility to share ER a a their market share a that on Nucynta the in in second quarter, ER over were decrease X exclusive within stable quarter,

patient regarding First, visits.

said, live in productivity in impacted taken, reopening was specialists to person. and to prescription our returned as Conversely, began of That mature and franchise, healthcare is quantity in-office this seen of inconsistent, to treatment from make visits on prefer has some In-office visits in as saw more actions interrupted we've has it's are the volume. an via patient patient has a cases we've growth begun visits customer impact which professionals of states decrease and continuity to corresponding increase negative in a new increase representatives states, a but business have interactions. care. access patient impacted, As spike second less a inflow. of to in Initially, patient sales in-office ability trajectory visit. return Nucynta new-to-brand as also negatively pre-COVID in The Xtampza, on and increases the our quarter, not may change been is through the dependent quality levels. benefit and pain we important is patient COVID-XX the their most impacted would

of level As have in-office of to customer states have some sales representatives our made return interactions. a reopened, most

We representatives our to taken remote interactions effectiveness remote and capability, To with patient investments of they in-office selling their in launched on-demand customers. increased the implemented launched help will a enhance communications We representatives virtual. sales non-personal the the mix a and being the be we've and customized of expect like to new so send on brand cards We websites. to capabilities And brochures We resources promotion. healthcare professionals. our resource shipping send increased digital resources We availability our co-pay our actions. sales branded interactions, training. of majority e-mail which capabilities allows we've can new year e-detailing our customer executing the these in following of for representatives remote rest

don't On formulary the exclusive to payer payer market mirror decline accounts the Xtampza normal positions execution, lives. that, to front This we've and through wins for our and XXXX. return ER for position that Optum growth exclusive working and secure Joe. what existing We're to actions achieve working new and the growing operational turn on It improve team with ER protracted We for on to we will market but through XX call the in we XXXX, uptake national XXXX. ER, covering in can Nucynta commercial set million of share. position we be is taken major believe franchise. the pulling the With anticipate the a payer They're we I'll ER formulary accelerate exclusive will to for access foundation the diligently of it expect Xtampza ER, on back new and pull-through Xtampza oxycodone also strengthen focused accounts. co-preferred Xtampza commercial for our is and more slowing focusing parity see in don't priorities a first

Joseph Ciaffoni

questions. open now Thanks, for will Scott. up I the call

Operator

[Operator Instructions].

first comes Amsellem of from with the Piper question David line Jaffray. Our

David Amsellem

doing on what Nucynta, latest I to first gross and the on sales. So to get between moderate thoughts your wanted net you're spread

to gross to some renew beyond in contracts wondering rolling and this And are really talked off trend won't past. can I'm you comment you regarding to if nets the year how going this later that year. You

which number take maybe more the that's So secondly, And with your all where beginning with can little And us thrown has ability on -- talk more wrench impactful you qualitatively has sort into a to with terms the one. at help of of on share extent Xtampza the understand the to of were that even then pandemic it the of pandemic a Xtampza, exclusive or be in the onboarded share. realities the how year? been, contracts you'd without

Joseph Ciaffoni

I'm will questions. the to the on Xtampza the this Nucynta question for Thanks pandemic Scott impact of with ER Paul share going David, take is or Joe. the Okay. the on and team on question, tag then growth.

what it's information improve is a can, look can like. probably we feel in to is with will Nucynta, strategy is Where try Nucynta's if will with early in it that give to we Nucynta granular you if possible, of So there and I XXXX terms do access, reasonable. our accomplish things. we to emphasize What want we to X essentially way

we be The of of in to have instances, second we so positions And the we're in the would have it would if on of to year. we your for net thing product contracts maybe keep inherited, where rate. to if formularies, lower would the are only that that negotiate sense walk formulary the fact, a we those able to or from on how speak gross to for to away an are And make we're love franchise. focused we to where in some expiring, didn't to impact question think would, able Paul rest on can is trending a because if about contracts but position some do work this

Paul Brannelly

guidance in provide expect net point. or rest is season we at year. basis range, to the our on mid-XX% the I to of XX% in gross through contracting call we'd that the And the year, this that maybe year-end go-forward Nucynta for range a of rest remain where this for XX%, anticipate would discount that updated For on QX that

Scott Dreyer

the David, the for Yes. how our question is of on that. Xtampza growth -- and it's for kind pandemic thanks impacting And

pre-COVID at kind while a XX%, impact improvement, of of visits down bit seeing primary the period, And So is been out look XX% the patient April/May what is there's visits. bottomed of driver period. the they're patient time on time versus if still that in we're still, little you

seeing And the little new-to-brand still nowhere in the capture. out Period. that's And So market but the bottomed near also impact. we're significant month basically June, a come means back new-to-brand in is It's of pre-COVID it volume what in market it what still affects is there April/May. levels. OER bit

we'd fighting office, be new-to-brand back expect we'll pre-COVID rebound. capture. as some patients the back to we're to share. And market until fully come of to continue And for visits kind are to back, patient So really, wouldn't see what call we

Joseph Ciaffoni

to to switching emphasize; these I have the in just where around that's our that's David. be, impact gave doesn't exclusives seem physicians would that Xtampza I sequential thing. on David, a and sorry, And want on -- patient the ramp, we grow I'm difficult And you is the a expectation isn't is would some It to it that's Scott seen impact also basis. but continue like will would do And something we've stats exception very the and of the person. of typical, that. ER visits just with when the of disruption in ER

David Amsellem

helpful. significant very or follow-up Xtampza? in Part overall progress D I updates getting and in Any Medicare for updates D on positioning contracting that's the Part front a If regarding sneak on there. No, Yes. any on better may just

Joseph Ciaffoni

Yes.

an encouraged, David. Medicare and our So, to is, I way The say and we in in of November waiting QX would expect great I we're for XXXX, now, QX giving that answer final we're midst right would update or call, question, be we're our Part commercial forward would negotiation, decisions the look call. to as doing whenever D. both that I on

an is when opportunities. market strong profile think, in differentiation. answer the those given of clinical be really when the to I share But So of have think I look; we able questions. product the demonstrated terms we'll move The ability that's to

look we're an our encouraged so next on And providing to and call. update forward

Operator

question with next Our the SunTrust. Gilbert comes from line Gregg of

Gregory Gilbert

such proper I you're what you to you different. that formulary, when like assume offered acceptable it recently was something would of excluded can There's paid from that is an case context? about Joe, lot say obviously in else? But or into a put that so example. people should we every something attention that were realize not a

Joseph Ciaffoni

Gregg. Yes,

thing, Certainly, leader take management, the to, first appreciate remove of responsible in pain a trying look, I a as barriers. pride in lot question. So we non-clinical

to we're look with being gross product the but differentiated at you of Xtampza their at on the Xtampza, when to away. going that no think situation we're reasonable X. as a Express would give unprecedented make I comments from think Scripts that see pertains you payer that also ER change net referencing to July decision And it I I And removed that -- took product, the can was you not believe you're if couple formulary. one, the is following. has that and ever effect that Number an the I

is preferred business national it reason XXXX. is in formulary. positive or for paying was ESI The a in a were a of Xtampza that It on was will second from position discount be never which perspective, the us thing on we non-preferred And for modestly for. covered never the was

quarters, averaged X making average week. For ESI into flat, in because XXX those perspective, decision, And it the put they'll the communicated of COVID-XX, per to was past be Xtampza patients. grandfathering TRxs about

be being prescriptions, work relatively it anticipate base. pain steady be impact So payers we not committed with discounts anticipate paying we to management, won't we're in responsible non-clinical a have said, continuing what do That on a all on as remove a that will barriers. to we will meaningful but to leader

in are We with active discussions ESI.

to forward. June, their an we presentation evolve and see of end moving clinical we'll updated gave the team, as recently clinical things As how

Gregory Gilbert

perhaps incorrectly you color. which any subject, progress from in cases the removed of your getting have part, different a some On more That's view? in helpful you're made of opioid

Joseph Ciaffoni

Yes.

at, positive, no it actually I would good So look really change. you question. suspect, be, at there's look, and is this really we're where When that another a

ongoing but that track We're as of or to them there's prior sales X,XXX with we occurred don't lawsuits. then is assume the of in in named are bellwether today, any of over of aware that Collegium for liability as MDL, So XX X Pharmaceuticals completeness, XX. none January just And today cases. the for or of are promotion Nucynta, XXXX. to regards out

Gregory Gilbert

Great. biz question's my dev. last And on

You done the what in to need past. repeat don't you've

are My to all specific clear think very that could highlighted other whether include that your areas you past. that you've to not existing about infrastructure the your company flexed criteria. you've at been the at areas in good that leveraging as be You've is the pain question

Joseph Ciaffoni

Gregg. Yes. Great question,

no feel focused And point opportunity emphasize the We opportunities the and active, is, that leverage engaged, the it we're the that. So out the we're in-line would strength do that growth change. we very then there's to capabilities We confident believe one, the I are there there's and We we business, final there. we what the know to forward. organization, is of structure but want on. moving it also are look, of anticipate and we're in cost

to did. We're for going to also we're So looking say able a not that do to value. be we deal just

Operator

comes Serge of next line with question & from Belanger Needham the Our Company.

Serge Belanger

about we and an is that drive announced future? RX to your, strategy a Xtampza new it a will strategy? I potential as ER Is of ER Can addition a this positioning guess the talk formulary in of to run the just you Optum preliminary switch still how question exclusive First should new think And positioning. about growth? co-preferred

Scott Dreyer

to you overall our just by is there, start things I'll reiteration of strategy. alluded So a which

there's our we've past, really strategy, three it. to legs when payer stated think as of So you in the

We exclusive driving haven't formulary our changed strategy wins. of

with for strategy our like alluded as have still running eye national a the Or add access we exclusive, would a an towards for you parity into one primary accounts, ones where also of duration. objectives. strategic some large longer this, that's maybe parity to. we But just So

at still we levers those forward. we're as So X march looking strategic

specific there as grow parity. a the so Now can this OxyContin, to and Optum, large we perform midyear there. to we of get good how a with view have opportunity we'll great parity first get we to understanding It's position and

as and be We a and it'll expect said It'll foundation well. of clear good set run-in for XXXX a prepared growth, but remarks, my longer run-in a as I in then be protracted. growth

forward. So it see to at can we're if or we and changes here. but other we at parity exclusive, grow excited like Optum an we won't if know from to see be what continue And we'll here accomplish it to leads perform

Serge Belanger

led Okay. second as increase to thinking mentioned, to an sticks COVID as Have significant of base? patient we visits. And could could growth this you be usage then in Xtampza -- seen growth, additional clearly could drive around? of from XXXX decrease of half avenue that see telemedicine a And that COVID, you has where an physician

Joseph Ciaffoni

take Joe. that question. Yes, Serge, is this I'll

prescriptions. I we're all is almost in this think less changing and categories, across what generates by are supported that and of new-to-brand seeing others telemedicine, research it doing

of So patient. of we to take talk near physicians in-person it that's and does changing think stable seeing rate switch that's when their physician otherwise we're when not to patient that medication, you happening it's be a great to that an their anywhere vehicle get the OxyContin the for that But able care to, visit. then something

Operator

with Cantor next Brandon Folkes question from comes Fitzgerald. Our

Brandon Folkes

on Apologies could that calls. if And few positive could had just this. has be between your shifts of funnel you're from of the some terms in maybe you COVID. end hopping I've COVID quarter emerge July? as the we the elaborate which mention business you of post patients of sort longer-term a been then seeing in But did tailwinds

Joseph Ciaffoni

two to going the hand I'm off those Brandon, Scott. Okay. questions

Scott Dreyer

Yes.

So we're Brandon, what kind talk when you funnel seeing of the the with and about market.

that especially in What little June, with a seen product, is back, seeing June. product. April out bottomed we're a is of as funnel the we're line hit a flows that So been kind levels. of talk pre-COVID in the the And and the pretty driver decreased near the then opportunity there's nowhere visits, what significantly tune of Xtampza a in primary it's new-to-brand seeing new-to-brand as bit market went when was we've to the to and May. July, growth you decrease what down in of XX% early of market standpoint. to basically new-to-brand, from kind patient XX% growth And COVID about through right and In

funnel there the rebound the what half new-to-brand, of the from your of we for the looking that's some standpoint So, second And kind the of it's down at since year. pre-COVID, go as season. be is from COVID of but we'll heart forward of

Joseph Ciaffoni

it just one to for portfolio completeness, Brandon, Nucynta And continuity from leads as care. thing of benefits to dynamic that

thing second degree The the the we visits as not market, saw Nucynta to IR IR to quarter procedures is other benefited. in started in-person of the same and but increase,

remember chronic Now with a is the used patients. of in pain percentage higher treatment IR, Nucynta far

So that's where, as a return to we do talk about Nucynta a moving forward, that when bit little things normal. may impact be where of there's tail

that's on to the stronger we're than So we why even continue a that. decline, say some bit we focus slowing in trends though seeing instances

Operator

[Operator Instructions].

Flanders next comes Dana the with of Our from Guggenheim. question line

Dana Flanders

Joe, Oxy. And to Express on the over seems given I and guess be benefits that's circle by on to me deterrent the prior put comments list. your exclusion what just Xtampza to to just surprising back to I clear wanted abuse decision And Xtampza's properties

of real-world price? real-world abuse would Express the And if seeing to there value, could did guess was deterrence you're of so and just helpful. or of the on provide on is, be color around its kind context you really kind on of provide what deterrence question a could also Any And Xtampza. I maybe some you abuse come conclusion different this Xtampza

Joseph Ciaffoni

into with get to I'm we're having that Express not Scripts. discussions inclined the

to, moment and unprecedented Xtampza and decision is the particular we're is of what ESI at the label, Express makers is of made would which And end sometimes I since it happened at the to with emphasize that decision of to really to look, market. across But to path you disagreements brought we I there's to tell and going with willing level real-world in formulary and a want we inclusive think the go that data, we've can is profile reasonable with have people the payer. the between supported committed very And I the the secure real-world focus a regards we're Scripts. there's it's franchise, differentiated I ER by encouraging. be the clinical positive business, and that deal to positions, about manuscript degree And a don't the a Xtampza the our clinical time excited portfolio because aware forward, this way just appropriate, to non-clinical never that's say of in with day, continuing discussions Nucynta that be think published. data, are Xtampza physicians of data them, even the to though continue there to of We're would barrier. a has us is, bring both being and what to to actually it I look, in

Operator

comes Our Jefferies. from next question with David Steinberg

David Steinberg

-- line you level A percent benefit price in see terms you couple and secondly, full And into chain the gross in other is of same bring did and for margins percent went Xtampza. what tech was now what did have the meaningful percentage your when at you those what recently And a margin you factors, out could talking supply Nucynta, Where not some process, through from of as in the the questions in changes follow-up. transfer. but about bottom gross things for is the improvement you Paul. increase then for margin? rights Assertio the was the When did we of from repurchase And substantially, one -- the improved through price improving that receive certainly the increase? of then the took, I company

Paul Brannelly

P&L or that'll increase, horizon. that the the We time plan. we talk can COGS, the the as early about as about in for longer-term relation know, stages X.X% that course deal, We're developing we so price do down maybe a across we price portfolio for it's our well. that beginning bring year. actually about of have took X% but impact. that next the over the And to a first that of a and X But as increase year, to but we we of can that years that improve at gross have you realized in And next can that. So far spoke Nucynta it believe belief trying we the that's in margin of the a belief as we

David Steinberg

then talked for are either in just of of has products? about for know of curious, some the you a beginning to unfolding with And quite you what the bring BD discussions development slowdown terms had would the Okay. should actively assets, sort have months? I next XX I And at And on different business be for think was looking of there Or on-market more the lots knee-deep lots stage companies of development, about barrier meetings year lots where you the and in can't high you of given then you over activity in assets. face-to-face thing? indicated that that and how pandemic, been because we assets very in

Joseph Ciaffoni

on. COVID-XX is because this our bullish business. stage what David, But stage two say is window the on question. Joe. and as leverage Look, we, opportunistically activity. where if Certainly had that a infrastructure. it that we're of bar in I an focused assets asset development you Yes, and are articulated, focused impact would the we're in engagement appreciate is could commercial how hasn't know areas: we the in-line there of high is midterm terms We the we

it think progresses active engaged, how see we're and the next many we'll and I months. over

Operator

of the We have session. end reached our question-and-answer

any comments. the additional I'd to pass Mr. back floor So closing Ciaffoni to over like for

Joseph Ciaffoni

on is Be Have year. our this forward progress. Collegium XXXX Thank our you. look you on on track Pharmaceutical afternoon. to updating a well. to you make transformative evening. a participating I for good Thank call

Operator

at may Ladies today's and time. does for thank gentlemen, and you your you teleconference. lines disconnect participation, We this this your conclude

Collegium Pharmaceutical (COLL) 6 Aug 202020 Q2 Earnings call transcript