SUPN - Earnings call transcript Q2 2020 | Supernus Pharmaceuticals, Inc.

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Operator

Good morning, and welcome to the Supernus Pharmaceuticals Second Quarter 2020 Financial Results Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to Peter Vozzo of Westwicke, Investor Relations representative of Supernus Pharmaceuticals, you may begin.

Peter Vozzo

Thank you, Sarah. Good morning, everyone, and thank you for joining us today for Supernus Pharmaceuticals' second quarter 2020 financial results conference call. of these the results. close press issued the announcing release after the Company market, a Yesterday,

Officer, call On Supernus' the at Jack Financial ir.supernus.com. Chief call Investor Executive Patrick. the with the Officer, Khattar me Relations section and Company's available being made is today of are Greg via Today's website Chief

for trends During statements These and existing noted in events June XXth, six future Actual performance. information. regarding those and the Form forward-looking forward-looking months results perspective of reflect and section of the of XXXX. XX-K, call, current and involve may from materially may management these Company's XX-Q XXXX update in forward-looking not this on course risks including report such those the Risk future Report the make and forward-looking statements. Supernus' quarterly projected statements statements uncertainties, certain on the Any ended guarantees performance Annual Company's on the differ are future Factors Form on

the as be Time. this may listening call turn the by you the held Supernus now filings at except to who Jack. then, XXth, approximately with additional these Eastern applicable Company releases declines update will topics made the securities benefit to I the to any related discussed. press required Since announcements may X:XX reference recent and Company's statements forward-looking SEC. Please XXXX laws. the most replay, and current over is being AM call obligation of have the of For on recorded August those to

Jack Khattar

second to discuss and the recent everyone, morning, we taking quarter Peter. XXXX results as us and time Thank you, developments. our join for Good thanks

integration the we our and On development. us products stage significant a diversify and products long-term progressing solid late candidate helps to CNS CNS delivered products development of has completed activities from revenue the be with completed been we closed product During base and transactions. three by in two the The significantly WorldMeds. our growth US acquisition results expect integration marketed acquisition to enhances well quarter, all and of and This the June we X, corporate year-end. financial earnings

an fourth we of Regarding the expect this to submit year, Infusion quarter or in approved by FDA, the Pump and SPN-XXX, to half launch second in product NDA XXXX. of if Apomorphine the the the

Activator in and data demonstrated of single early of development with Preclinical XXXX. tolerability improvement of the proof-of-concept in clinical opportunity and showed favorable half symptoms patients announced Phase SPN-XXX safety I the development corporate first-in-class is Development Navitor the renewal, with a SPN-XXX suffering activates brain SPN-XXX. molecule second often sustained is the directly with and the a active cellular dose Agreement ongoing orally in depression. The Phase of depression gatekeeper mTORCX of is treatment-resistant metabolism for are and from targeted second activities that quarter NV-XXXX in in Pharmaceuticals initiation mTORCX, for people and currently depression. which the rapid program Option or in depression core its small suppressed which with II

SPN-XXX, engaged PDUFA which regarding the to action Turning target NDA, FDA of Xth, we with the remain XXXX. November has date a

the of This the market the quarter represents enrollment FDA of important of put that by to in in ADHD in market, XXXX. will March SPN-XXX, launch SPN-XXX, on data the the us is XXXX. SPN-XXX with the Recruitment to to trade due commercial of of for for patients targeted resumed trial impact the This which by expected adult We if complete first year-end after adult line help half with use to U.S. program III shipments prepare COVID Phase in pandemic. the expand continue the in an hold trial top the December the is in total has being approved

XXXX, essentially the capsules first XR trends number of for on sales the by continue period restricted due extended in compared physicians, the quarter months impact access by of fact showed XX% IMS to last reported This Oxtellar due X.X% Moving of and Overall, Trokendi size the has looking for the the in been year upwards and that to half reduced XR of growing Despite this to as six the reflect by the Trokendi trending first a growth, pressure represented the tablets, COVID Oxtellar past prescription Oxtellar flat in total period units, XR XR monthly the compared pandemic. the despite in on pandemic, prescriptions, X.X% total, Trokendi a or year. adverse of second resiliency, pandemic months initiations prescriptions new XR, show force to six last the average patient strong whereas the the six at Oxtellar and with in is by in COVID patient first prescriptions to declined to visits, as XR same environment, year. same Trokendi months. XR the year the and for and XR to

the XR the in an growth first cost higher in half quarter Trokendi each the per this led in wholesale some both for year. Taken price second of sales overall average increase, together prescription the Oxtellar net acquisition and favorability products. that compared XX% to Adding of for with annual resulted to a last gross-to-net deductions XR to in in

MYOBLOC Regarding by exception APOKYN, the closing quarter the acquisition seen maintenance. therapy The through visits physician sales the pandemic the with products we instrumental X that have MYOBLOC, from patient of date initiation COVID the and impact where fairly second has XADAGO are most and end of quarter. been in in the June the of of the recorded stable

the patient year, assumes to all patient with Company visits, reduced continue and physicians, the number COVID the products. our of on to new remainder the will access restricted For pandemic that initiations operations our impact of

provide position details in growth our on I'll CNS. turn Greg, over financial quarter leadership second continue for the strengthen and performance. who Finally, to our look we opportunities call further to strategic now more will future to

Greg Patrick

Thank you, morning, good Jack, everyone. and

of Total on acquired $X.X Company's same as As the quarter million, products acquisition, deductions report in $XXX.X please to volume, quarter X% gross-to-net of year-over-year was revenue, the was quarter impact was second as $XXX.X XR quarter of $XXX.X of press In quarter million, last Parkinson's January to sales of impact results, Trokendi quarter. on quarter and of XXXX. second the Oxtellar the second from the taken sales million. for reflect in of XXXX due was products. of product XXXX million sales XXXX of sales the million through Oxtellar period and the our beneficial Parkinson's an were million of activity tablets, compared comprised Net I as royalty year. net review $XXX.X from product capsules increased XXXX, of afternoon. the net in date end and measured XR the to an by of second and XX% June XR product $XX.X and Form The revenue filed Monday Net lower and revenue $X.X Oxtellar disease neutral. Xth, XR number Trokendi revenue $XXX.X XX% royalty of the same the XR of second price increase Trokendi yesterday's refer increase XX-Q of disease XR Total the in essentially or sales the million, million, to over release well

quarter year, for million FDA. period. of with $XX.X the XXXX. million Phase collaboration option second for $X.XX expenses agreement increase $XX.X by was trials. second reduced SG&A because $XX increase $XX.X offset million or quarter higher partially Research second to $XX.X disease approximately and due partially quarter to due the Turning the purposes. expenses XXXX the quarter $XX.X earnings the higher second related in compared The or attributable the from to for or offset of products effective expenses $X.XX for the $XX.X $XX offset of to to primarily increase earnings acquisition This income to year $X.X primarily of were million million Parkinson's million is associated than paid partially XXXX the share million million Navitor million program with in quarter XXXX and as by to year. SPN-XXX the fee compared now expenses transaction of development earnings $X compared in second tax operating PDUFA Navitor of only partially the the SPN-XXX, the for with per fee III Phase in This associated to Operating to second associated were quarter of Parkinson's products. III for share in in the XXXX diluted adults. XXXX the Increased expenses. a of earnings diluted sales, to were expenses of increased the expenses in are refunds same was option prior paid SPN-XXX expenses acquisition-related $X.X last subject Pharmaceuticals were Net prior XXXX, million part quarter second coupled the with were to for were the disease million product by quarter Net net the for the spending deductible the per the relative $XX.X of year recorded rate period. last the tax fee for million acquired

also increased. the tax states number of has which pays in In Supernus addition, state income

securities cash, marketable As $XXX to compared securities million of $XXX of cash long-term in XXst, June December XXth, had XXXX, XXXX. and the marketable Company million equivalents, as

Company $XXX.X approximately development from in Parkinson's expenses, inflow, Offsetting $XX the Navitor the of million During XXXX, as related the the first to cash acquisition Company $XXX payments inclusive part plus made this for payment net of of of months million of operations, cash working the products, for million upfront agreement acquired capital. inclusive the six disease of SPN-XXX. changes cash generated

by the products, after quarter the of Xth, acquisition are acquisition as financial full-year the June due to in of updated impact pandemic, disease the Turning of Navitor. the to this XXXX that products with XXXX guidance reinstating guidance, May uncertainty guidance and of Parkinson's the it PD we the suspending partnership updating XXXX. reflects Note caused and XXXX now second

million range we the Parkinson's to portfolio expenses the the products. We expenses our sales approximately SG&A $XXX XX% expenses half for of are expected XXXX, gross compared million the to to from from expect be year XXXX SG&A which for million million full expected higher $XX for product range approximately $XXX net are of three second full sales as And margin full approximately million, approximately year. R&D year. be For acquired half the to in from for anticipated anticipate $XXX includes of first to net million $XXX are in $XX products. to reasons. product to disease

acquired support Pen. nurse network, the the support and sales First, the primarily products, the cost APOKYN PD who representatives of the XX to including sales

And SBN-XXX. and of increased the of which of Second, launch including the third, prepare support to for marketing will sales the market the force, management is representatives launch in This SPN-XXX. sales build fourth spend quarter. infrastructure, of in out the our also occur

of SG&A We expect the spending to the one intensify cadence quarter from next. to

the assets, call back XXXX year Turning full anticipate intangible intangible the to million, to operator I to for amortization $XXX operating earnings questions. million of from $XX we assets. incur you. will Thank full $XX of now amortization to year. We approximately inclusive range of the million expect for to turn

Operator

David you. Thank Sandler. from the of question Our Amsellem Instructions] comes with [Operator Piper first line

open. line Your is now

David Amsellem

Hey, thanks.

function differently extent regarding prescription? related? I reimbursement terms And that I that for reverse is Is a Oxtellar. strengths to Thanks. the a one. in number or regarding the anything product the and that here, wanted that's for So you do more to related? you to product? Can drill new larger this need normal that So anything two. something just think toggling that's this APOKYN. then the that and to it but COVID a about here's plan do apologize total Trokendi the on of units if you what number down something COVID commentary in is missed talk prescription for could secondly, differently landscape I you of dollars access was to And sizes, Do anything of my

Jack Khattar

of couple questions. Hi David. I'll first take the

specifically Regarding increase the an Trokendi we've since launch, on size, the over noticed the migraine Rx XR, the years, size over especially Rx in time.

that the tremendously the noticed slope the we've However, accelerated of curve months. three in last

a COVID attribute -- growth recent growth definitely the the the Rx size So of we the in because pandemic. of lot

probably mean, I we -- side, really expect fluctuations at right stay half, can second is have we on. and it going it here, we to happen what XR. at This continue It increase, probably specifically question I was not with as point. is Trokendi in this mean to the on that is jump as Well, at more one-time to level. the don't may point. do where but this in I this the was know your but will far it favorable around Greg the it stabilize time, of quarter-to-quarter. typically And can gross-to-net one So

starting Over a when that gradual mentioned we've the during the And worse there with the years, QX is gross-to-net. year, actually it is to improvement. typically always comes

However, XR QX in expect QX, stronger in we come or this a QX. that to improvement Trokendi same time in had don't and we in improvement

and promotional on As the as the are far we whichever aspect points all of the want it. a so care, or lot But we're synergies force behind different you see it, perspective, our of growth, it's growth at angles a are it's looking products, from on side way whether with the reimbursement at and continue aspects rejuvenate basically, and characterize the on the forth. I whether managed all sales accelerate APOKYN of access, to looking of mean products the where or growth to business

So you might forth the Actually, hard. next year. of working and so for we're imagine, remainder the continue for pretty execute the -- the and on as putting year plans

be although now, we'll is it access there looking good like it so not any that. So lagging reimbursement, at but access definitely it's have improvement, fairly or be areas right of does should

Operator

Thank you.

of comes Jefferies. Steinberg David the next line Our from question with

Your open. line is now

David Steinberg

good and thanks, Okay, morning.

seems first year. guidance point you my this the So, wide is, revenue the range for question gave of pretty

for think do the weaker beyond past approval? the usual And Rx said Just And the -- so, due launch is been second XXX weeks to of in Is XR, the if in now there question growth? COVID, in that's because rather I the or managing for bit new fairly does seven you weak for -- -- to -- the cash think wide you the stabilize? have more they've prescriptions will the curious, shipments why when is a assuming shipments that? second to, anticipating December scripts this Thanks. CGRPs? of than the the wide guidance trade oral XXX is, for been six -- do you And relate Trokendi guidance? are flow think actually, My you're you included than any franchise

Greg Patrick

million, range It's we would typically Okay. this really several David, the we first a million time to is is wider take Why probably this Hi Greg. So, $XXX don't related bit we revenue have the question year. factors. to than $XXX first? of --

units First the have which pandemic a but the of all, has in the general time, those uncertainty everybody around prescriptions bit. over whole Rx trends situation. The new sees, number of increased softened

is going our there to COVID environment do continues the what concern business about forward. with So

forward. is and Company with know recognize COVID, you're COVID the also range. new going impact these uncertainty Parkinson's less launch some but the with the you as then that disease And managing these is are us a on by impacted third, well. respect to progress getting these quite of Secondly, be products, and there's SPN-XXX the of running right, these for bit And to board the there there we though nevertheless the how plays They're into year. during course little a going

hard actual uncertainty on guidance We the anticipating are very much revenue products is we approval trade, way very which going have recognition shipments, by the in all actual not course and This to the get for the related, when terms the is timing quarter. gave to driven shipped in can approval. heavily we we in timing the be of of fourth the of assuming to the of forecast and based dates

David. I Jack. think to Thanks, second hand the I'll question

Jack Khattar

look question last example, first versus was absolutely for was of that but the previous quarter like XR flat year Trokendi case. last at quarter the an or right, is artificial this trend. XXXX, for actually first quarter more the first and the you're Trokendi the second prescriptions, the regarding quarter XR Typically versus, XXXX Yeah, quarter down -- the you flattish, year, if on in

Of noticed March. year higher, pandemic, the in case, actually which this this the companies course, because March COVID of in uptick always was many and

I that that is saw in in increase I because for in April March. we my of So half the March the back down as the what in total minus in and prescriptions my these XR declines and on increase first why absorption seeing regulating in Trokendi and May, that Overall, in yes, mainly and I first the is mentioned quarter in second -- we're environment mean, in half that's happened remarks, of first the about of in, tough because we're made if living you comments quarterly last year. fluctuations versus X.X% half the

pressures as in these in other give more our sensitive. just dollars promotion with dynamics COVID as TV to see so granularity, to our with I force very case, products in situation. TV far you forth. to are of addition the sales millions are mean, mean on advertising. competitive that selling to used of with competing we continue are I Most And We not the and in products effort be

access hindered would ability much So would promote we with like levels well our like as as forth. to as samples have and the restricted have, to be to so able you or logistics at physicians to, issues the Trokendi as XR we obviously, to as same

to for product the for the half -- pressure will the probably rest of of second that So this continue year.

Operator

Instructions] We have time question. for [Operator Thank more you. one

Our Samimy from Annabel with last question of Stifel. comes the line

open. Your line now is

Annabel Samimy

sampling you're what helping you're given way about I the to franchise. some investment to Thanks. WorldMeds, have speaking, in with how's each guys, Hi approaching situation you're about change talk of going leveraging with you going adding terms do more And anything going is the to if modify was in And time. with with again. market? program? to Are that psychiatry, online if closing might in And you? to taking see this you you've hurting you that on pre-launch to to what COVID, devoted now wondering continue or what's that doing could question. allocation it Is putting the of or the pulling there anything capital talk change we're maintain to at that from SG&A, broadly to Does my going in be I and down activities was build it you your the wondering for then, this? thanks epilepsy, more We you could break it? XXX capacity

Jack Khattar

Yeah, sure.

activities, since of doing been Regarding that last the actually a pre-launch year. lot we've

aware and on XXX preparation view is the are what understands the and of -- differentiates treating been medical these data we've there actually medical majority marketplace activities generate behind as out point community there able products would out ADHD. XXX the unmet the and they're data. and So, to how how of the you can in What the the expect, a that it scientific of need issues sure make data around the solve of SPN-XXX, other versus is the lot to

the tremendously lot So to it's call we've that speaker environment -- it today's whether focusing of we've want doing been focusing so a aspect been you programs and virtual online teaching of on on by and actually forth. conferences, symposiums,

have plans; in COVID So normal of physicians lot a a launch to launch we've or a never I I'll and different two thought one. And actual way. regarding one able my the plan, regular one reach a career been that

hybrid launch time time. continue the launch adjust, pandemic and on the of plan, we'll how over of launch, the evolves be semi-physical to type ready on exist So semi-virtual, to around environment we're depending of and a planning continue kind with we'll potentially

that now explaining between But all day, and efficiently. other been that challenging, replaces a the can very substance. as interaction so either the data so use the where but forth. samples. of you the sampling to of scenario could of not a tools and in I of being directly a is fact potentially we're the product this effective are So, end What expect ways patients it and at samples virtual we've lot and many this in representatives physician exploring send helps And really and is the as is companies obviously different sales But the clearly nothing think face-to-face distribution we're or able facilitate controlled to we environment. course, effectively regarding a forth,

of us the and hopefully we very capital then, avenues to to I allocations. different that many committed be existing So as to allow to finally, as committed reach all, are there explore be And as as mean, patients continue to neurology will we possible. portfolio. far able first

support products in use portfolio our from this is different going a be exploring launch scenario able ways products across marketed resources five is to or many of course optimize SPN-XXX. that, here neurology six portfolio are will definitely to not of the So, to be Having actually the the neurology-focused where we're between a of said take psychiatry. a to now we what of hopefully, six, and off

will and how a and at initially will we have decisions over past the of because over -- course, little all launch also sales didn't use looking sales expect we're these you optimize when the post-COVID, the or the new of months few as So we forces support which time well. in of pre-COVID can force shift plans And changed bit our evolved time, would know XXX?

fluid parallel, successful the we all product, will it other as continually to to a situation, products the be SPN-XXX support and well. a neurology sure gets for it's all requires in have investment certainly we make that but want adequate So

Greg Patrick

-- say add are, this Jack's Annabel, comments is Greg. just like which to on. spot to I'd I'd course, of

This will be SG&A will the impact also because the in discernible a of the quarter, the sales between nursing and and third associated will fourth quarter products primarily supporting support to pickup XXX addition also additional through the be as reps spend. be but force network added Parkinson's terms including disease sales expenses in network, progression spending. the of up the SG&A an the etc. marketplace by marketing the year, there simply there driven with but third In the step we've for

include going the the well will, for to we fourth expense coincidentally, As quarter. to marketing get which sampling launch, intensify too, spend as is closer

there spending XXXX implications So, obviously a spending year, well. it as that for for and progress the when like think -- and in should about is here there you are

Operator

Steinberg Thank you. line from with We the David Jefferies. do have of a follow-up question

line open. Your is now

David Steinberg

I Thanks. one -- allocation. business to more on capital had relates question, the development

year million you million in cash million first after So $XXX about Jack WorldMeds. half cash Greg, with and in ended the paid even you and you QX for $XXX $XXX generated about this US

So of what cash views perhaps are if your And on BD/acquisitions the for utilization? the year. end Anymore [indiscernible]

Jack Khattar

the David, off. me first -- you're cutting Sorry, of least address at let I majority Well, can if the see portion of the question.

far we generated as amount development, opportunities the look as as sheet. because for we So, business mentioned, exactly definitely, strong have here, continue of still other to We you significant a have balance cash.

neurology look are CNS we So or case. either to the opportunities different at psychiatry, continuing within

Regarding going a building a more of capital a is flow of and cash little half be perspective, expenses, the add the of level generation, to SPN-XXX. to working frontloading also that, because inventory generate the the the from of can of Greg to bit similar lot cash a of second difficult the

that lot a of cash in will is consume there So half. activity second the

a we bottom conscious balance But are well continue have that we So look. strong to to sheet. as we continue sure the make to will line about is,

of to both add still to are products. engaged of course continue synergistic that lot physicality are different opportunities and our with in to current We neurology a

Greg Patrick

Jack. Thank

generation Cash direction that add referenced. move in to So, of the to going Jack is thoughts. David, course Jack's to just

million, intangibles. $XX amortization months, about million of that at first accomplished six $XX what the we're of toward guidance million Our $XXX objective. of inclusive we for look If year for million the we've $XX to

of back-end which it positive, but of couples dint So months. with be to robust going six just the in SG&A around it's first comments to generation clearly as my the here is going be also by was as up not cash cadence spending, the increased for guidance the the previously

Operator

Thank you.

further to queue no this closing have the would We now questions at to Khattar Jack back in turn remarks. call for I like the time.

Jack Khattar

a earnings results challenging continue revenues half year, of XX% growth in of solid with XX% have the well you. operating growth employees our to Thank first operating delivered operations. last They and our execute Despite earnings across this many very in year. net to areas and in compared environment

and our products. very corporate in addition, important the on Parkinson's employees progress In significant acquired made executed development two transactions integrating

into of NDA growth SPN-XXX focused for the of move half we represent the for to the submitting the As preparing FDA and the stage important on assets we two launch late SPN-XXX. second XXXX, two drivers for remain These Company. very

driving toward commercialization them moving focused are to our growth accelerate forward. on We

also with in providing a continue you We very forward revenues, year. our for much during earnings, us to support will to flow. Thank rest and us marketed the We products updating neurology, diversified cash the of joining morning. look you continued this

Operator

for call. gentlemen Thank disconnect. you Ladies this and concludes today’s conference you your participation, may now

Supernus Pharmaceuticals (SUPN) 19 Aug 202020 Q2 Earnings call transcript