Earnings call transcript Q1 2023

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Operator

Good afternoon, and welcome to Supernus Pharmaceuticals First Quarter 2023 Financial Results Conference Call. At this time all participants are in a listen-only mode. Later we will conduct a question-and-answer session, instructions will follow at that time.

As a reminder, this conference call is being recorded.

I would now like to turn the conference over to Peter Vozzo of ICR Westwicke, Investor Relations representative for Supernus Pharmaceuticals.

begin. may You

Peter Vozzo

market, Good us Steven. financial and you of thank conference release a Thank these announcing for afternoon, Supernus joining results. the close the today Today, XXXX company Pharmaceuticals' for issued call. press you, after everyone, the first results quarter

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

course and performance. the current future section filings. noted latest those statements risks make not and call, certain forward-looking may Risk of of the are During the in company's statements trends Supernus' guarantees of involve management and the information. future this uncertainties, statements reflect forward-looking SEC and Factors Any perspective existing including regarding These events on future such company's forward-looking performance

forward-looking Actual projected in results these materially those may from statements. differ

those replay, announcements Since be company of X, may XXXX. have of then, who is benefit recorded May and additional any made call by the held the may to this For statements, Please reference on the you, declines and the current related the to listening these company's update to applicable required filings securities with topics laws. except SEC. Supernus recent as press forward-looking the most discussed. releases obligation being

I'll now turn the call over to Jack.

Jack Khattar

for the first for the first quarter Despite set the in join us typical industry Supernus the results to results. time as quarter, of the headwind entry Peter. you, performance stage taking year. XR in our and afternoon, our delivered rest Good XXXX discuss for Thank strong the and insurance on the and first solid thanks everyone, we quarter Trokendi generic

of or XR. year sales achieved This compared was a despite first total decline essentially a in decline million achieved in $XX $XXX the of flat In significant ago. Trokendi the same million period net Supernus million, quarter, $XXX XX% to revenues

earnings operating last compared $XX or first XXXX to same the of quarter were In million $XX in adjusted non-GAAP addition, period the million, year.

net XXXX and sales of of year-over-year, patients XXXX XR through Qelbree brands setting by Excluding positioned driven Trokendi and both remain the growth pediatric exclusivity and continued and growth to double-digit loss transition We XX% the product we manage increased of adult in as quarter Trokendi to our XR beyond. of adoption by GOCOVRI. to well first stage across deliver growth

Prescriptions recent to compared of XXX,XXX, continues with reaching increase the well IQVIA month the X.X quarter This sequential fourth representing annual run perform total in more first to March prescriptions. Qelbree XX% Qelbree total of reached rate monthly an of most represents million this of in a the the of XXXX. XX,XXX, the for than prescriptions quarter launch. year, since highest

underlying U.S. quarter acquisition cost quarter base prescription, the also Qelbree on XX,XXX, coverage, dynamics that in growth first managed of on continued approximately XX,XXX care capitalize ADHD to XXXX. continues fourth in prescribers of the last In increase we per an the improvement of prescribers. in prescribers XXXX, in including the base market overall the elaborated several average to wholesale from Qelbree's its Qelbree expanded up and the growth of quarter in

perform giving and the deliver the in substantially complete, XX importantly metrics, beyond. give XXXX is and us important of ADHD expansion of across on In approximately to continues us initiated us This by growth higher our prescribers. growth broader capacity representatives force decile We to sales increased XXXX market. cover expansion reach more high to to and allowing in several in sales potential its confidence summary, Qelbree more than XX% frequency

the million $XX GOCOVRI respectively. XX% and an and for to XR net $XX sales XR, to period million product Switching Oxtellar for X% last increase compared now to GOCOVRI represents and year. This Oxtellar increased of same

were quarter million first of the million Trokendi in sales the down In in product from the product down XXXX. and quarter first $XX net sequentially the of four three XXXX, was XXXX, year-over-year of from XR in strengths January $XX introduced. of $XX million, first to XR generic out quarter fourth Trokendi Regarding the

for for XX%, quarter first of for Total to $XX our XXXX point, million quarter, the million strength the Later Trokendi last compared prescriptions year. are $XX period the guidance market. a At to by and between this sales net the declined we generic year. fourth for product the XR in maintaining the same entered

the had our on the regarding SPN-XXX, this expect obstructive we the Based year quarter apomorphine in the resubmit to April meeting device. meeting, pipeline, with we in the of XXXX. fourth infusion the resubmission on for to Moving the NDA FDA of NDA

Enrollment is adult patients II we with SPN-XXX in to clinical Phase the progressing half in of in expect and seizures top-line XXXX. study for first treatment-resistant data the continue open-label

study SPN-XXX, SPN-XXX will of safety study For placebo-controlled course examine adults of and is double-blind our efficacy active five XXX activator, treatment Phase mTORCX The in activated. the oral and over ongoing patients. sites weeks treatment-resistant first-in-class the randomized II with XX the of a with depression approximately

fall pipeline clinical holding year were generated that candidate in and Day further to our through programs developments. discuss of nominated We're program clinical detail new in on R&D planning for Discovery an this and our lead

development growth corporate we CNS. future Finally, be strengthen leadership to for continue in further and active strategic looking our to position in opportunities

Tim. I will to over call that, turn With now the

Tim Dec

Good Jack. afternoon you, Thank everyone.

for partially due product net refer net million. quarter in product review that increase our quarter Qelbree, $XX.X XXXX million I quarter million of today's was revenue, The XXXX please $XXX.X earlier the the was last by to of to compared revenue net sales of $XXX.X quarter year. $XXX.X Total GOCOVRI, and and offset sales revenues was in XR. filed royalty total the XXXX revenue of were of first results, release the in higher and revenue to sales same Trokendi of decrease Total press first today. first royalty million XX-Q comprised As product in

were year. decrease period primarily was expenses R&D SG&A Adamas $XXX.X to first in QX which due the were resulted included in million operational compared for integration that same quarter million efficiencies. For $XXX.X and as The last combined XXXX cost, to of the XXXX,

was million on Navitor. basis for a the first income compared XXXX $X.X first as for $XX.X XXXX. same quarter GAAP earnings first the on to for The of of first to Operating operating primarily $X.X sale $X gain million in for was the compared other the a XXXX recognized Total quarter as the change XXXX year. earnings subsidiary to a period quarter quarter million is of last of due of the million

period, same noted was The of $X.X lower benefit calls, on pre-tax in income of loss tax prior for income quarter the to primarily forecasted of first compared to tax last In XXXX. in our quarter XXXX, XXXX. the XXXX million as we benefit due due an was period first first year. as benefit income $XX.X an million the to of a the tax benefit reported for tax entities reorganization quarter the a year-earlier of corporate Adamas in income the The of

previous to adjusted period consideration, were year. assets, earnings of million per million net excludes $X.XX was On to first the of which million $XX basis, compared earnings or and intangible non-GAAP diluted period share-based $XX.X the the operating expense diluted million year. compensation, compared $XX.X XXXX, a contingent depreciation, quarter the or in same last $XX.X gain, share for share per GAAP amortization same in $X.XX

XXXX, cash, compared XX, of the and $XXX.X million company to XXXX. securities, cash, In its fund $XXX.X from November convertible due XX, restricted notes. marketable cash credit December was amount of million in had the drawn amount company total approximately million Senior to principal generated as under the convertible to The operations primarily and equivalents, XXXX, March note the of net increase on payoff. due the line As paid the of cash XXX.X

Filing repayment, longer of of outstanding. the XXXX X.X the interest million. to addition the no notes outstanding In payment due remaining are

extent, hand The primarily available a maturity existing the through under of to XXXX company's the repayment was at credit notes line a borrowing on with and cash agreement. lesser financed

We expect repay of second of to this credit by borrowing the year. end quarter from the the line the fully

to guidance. turning Now,

the of company and combined earnings raising the For is expenses. ranges R&D operating lowering GAAP SG&A full-year the expected full-year expected and range and XXXX, non-GAAP of

year-end company of guidance its prior total reiterates the For financial revenue. XXXX, the for

to and such, sales $XXX expect net of we $XXX comprised revenue million range total revenue. product from to royalty As million

to mentioned, range sales product million in million. As $XX of to we expect net the approximately of Trokendi XR $XX continue Jack

the from $XXX For range the prior XXXX, to full to $XXX million to year we combined R&D million now expenses SG&A and million. $XXX to $XXX of compared million expect guidance

most to the in of of the second As this of we related starting in Salesforce the mentioned with XXXX expansion the to previously, expense was the Calgary support growth quarter expansion year. initiated

$XX million operating expect the season, loss to $XX full-year the $XX expect along in compared further loss operating million during Calgary commercial of to GAAP of We growth range an with initiatives for previous the million. of in $XX products. million guidance We now back-to-school investments for other to to invest

operating $XX $XX between this to that Please reconciling expect million $XXX million of to issued the compared prior $XX call refer various previous ranges earnings release to we guidance the finally, earnings non-GAAP to from GAAP of And million. the million press range to to identifies and items non-GAAP.

operator will over to turn for With that, back Q&A. now the the call I

Operator

Instructions]. [Operator

line question of first of Jefferies. from the Andrew comes Our Tsai

Your line open. is now

Andrew Tsai

appreciate Thanks, question. taking everyone. quarter. you my I Great

So, major on January, in effective the think XXXX. first that that I congratulations contract, PBM one is logging

occur. thinking longer of expect latest XX%, gross on that remind can So net little greatest to could a fair could take maybe XX% target or Thanks. Basically, is this it year than it that? us and happen in of assume to range the when that we bit

Tim Dec

in Yeah, became Andrew, regarding it effective contract, first of second the quarter the XXXX.

co-pays, the within the forth. of always or didn't because contract full factors the of QX because the higher effect deductibles, contract have of high so that of also insurance, a the we see Now, you lot effect and opposing

So, impact and better fourth and quarter quarter. more third of second second contract we PBM the full in this certainly the obviously quarter in the the expect even

closer expect the we And So, year-end. through the improve. to the year, gross-to-net we definitely progress clearly, us to XX%, to answer by get XX% question the as

I gross-to-net throughout we typically worst see level, the it business So, linear the it's be year. what with typically the QX -- improvement going then in our to at mean, that's most improvement and likely? is in

certainly, from hopefully So we even early XX% the by what along XX% net Qelbree or that's year-end. XX% moving on to expect towards the gross

Andrew Tsai

it your Trokendi, just out And agree maybe year? quarterly double this is, accelerate Oxtellar basis root more speaking, case, And trying then, Thank if and and very assume going the case, of more know the products provide guidance. triple Would should your that's to to we so one almost a on if not if if of is guided on with it's guidance are assumptions to just I based question. forward? -- you. Qelbree's resales backed Qelbree you forth? all my the fair But which that's directionally reasonable you sales that That's then maybe including not could then you've agree Right, than clear. you would

Jack Khattar

to as year, answer short on answer on, double an yes. goes year the that. that do especially is top mean, actually get back-to-school also last expect The It we closer given than last is, Qelbree to accelerate season Yes. all I Yes. the year's of and as more easy course we that's performance.

the the a WACC, brand in the we average have the on several in dynamics care are behind cost. from and managed ADHD itself market, wholesale acquisition comments last and improvement obviously, healthy even being us, quarter And quarter, very increase this growth the from expected continued to clearly the market, fuel helping different the marketplace to continued then made coverage, perspective, the continue market that are a the about

in of forth from perspective. so the course, sales market our force coverage the and expansion ADHD improved and And an

direction, So, and one in increase momentum pointing aligned has the these and are Qelbree which continued all push product. really the to growth the behind and

Andrew Tsai

Thank you, Jack.

Operator

Instructions]. [Operator Okay.

comes question Next Piper Sandler. Amsellem from of David

open. now is line Your

David Amsellem

Thanks.

have So, Jack, may to talk see And going over mix you adults is pediatric said remarks on on on where mix you time. adults you Qelbree, impedes. what think mix overtime? your where between that missed between about current prepared evolving and you But just the can go about, the I talk

filing in upon on provide Oxtellar you where believe on access? real generic improve quick -- you need can XR, on trial more care Secondly, generic of a filing just you And managed terms I then have third, a a specifics pending. point to

Thank to exclusivity loss just on your and So earlier-than-expected Oxtellar. the get of an risk that thoughts wanted of potentially you. relative

Jack Khattar

Sure.

pediatric is XX% around first I market we almost On rest XX%. right The adult are and question business. XX%, are if now, XX%, the the the somewhere bulk of in being mix other about it the the around Calgary mean, between we remember, itself, of where for adult it's you around, way the pediatric. where basically and

And So we've clearly eventually we're as time the for know still exactly expect adult happy will don't to it market? Certainly, Obviously, the well fall the with mix launch. mix launch. now pediatric sure. we're in grow extremely to right mimic back-to-school you bit looking bit market. done versus the in we the a continue the it at the adult goes now We little on, business in And right in more season, with looking business season. the also, flip our but adult may early the at behind a very little have momentum back-to-school and the because

to going it are to probably ourselves will find continue at these shift, may to shift mimic exactly. market, some So, not and point, time over ratios closer but we the but

us discussions an and ongoing add with our I with we PBMs for next contracts contracts. where question ongoing Medicaid an managed different always the makes these we the to reasonable thing continue look on position continue mean, care enter Same it other sense always Regarding improvement, our and and where is states. will process. mean, is process for over the I to time. It's that improving it where the

continue goes on, and time really the as our ammunition gives as the renegotiate prescriptions of couple to we've up, in the even way been successful, as goes as time contracts that a in clearly, be as last goes improving further growing try back to And years, utilization and us or to go improve on. position solid -- we

are generic -- Oxtellar sued on have to generic where XR. the three and entrants these in generic we three that XR companies wanted we Oxtellar we have basically Regarding come situation,

XXXX, Oxtellar We are the is of able expiration, may of really that there can't one in XR comment exclusivity end be I the middle not. may other, the on we is maintain we patent or to a the litigations. but which way risk certainly or till

we really So, don't know.

don't the how update occur. things they street We progress on or if certainly do any will occur or whether progress settlements

moment can certainly, anything there there But So if report certainly, a we this for on but really, definitely will at goes time us Oxtellar as report, up. on. anything XR I is or announce is nothing comes risk

don't know was on Trokendi I a XR? I -- question there if And missed

David Amsellem

it. that's No,

I on mean, just have that Oxtellar. may if up on I prior follow not you that, I Just a believe just litigation quick Is quick. I did you win had refresher that. I'm real mistaken.

Jack Khattar

TWI Teva. appeal. generics went on first two two ACTAVIS, actually on in we cases, and filed the and cases these now The to that XR, Oxtellar which won We all is court both through way

timeframe So That was resolved XXXX, the were when cases actually correct. favor. that ‘XXXX our those is in back in

the So, this wave generics. are two the filed generics litigation three to with is have a and last second we in wave that second the in years, of of

David Amsellem

Thank helpful. Jack. That’s Okay. you,

Operator

Okay. Thank [Operator Instructions]. for you the question.

Samimy Annabel Our next Stifel. from question comes of

open. Your now is line

Jack Padovano

a the you is launch to Thanks have the for little This or seem episodes to want off they on Are refined talk pretty questions. that talk about maximize do and your the our both GOCOVRI any there expectations? Hi. Jack of treat that's treatment there? bit about can Is how only for physicians Annabelle. the receptive you and dyskinesia. to Could period? going relative taking how to that to friction You a message off

Jack Khattar

product. Sure. I have very regarding the Yes. positioning It's Parkinson's only episodes. market that been the the the profile, approved which of treat getting from the it's we and in unique the dyskinesia with response of unique mean, we -- and GOCOVRI is from is physicians to have pleased product been a

the solid obviously, the first on the that everything insurance given of first and quarter, have quarter. we our goes was again typically else fairly business this And in in also which it's headwinds quarter

versus XX% delivering growth GOCOVRI year. last with happy very are We

on bit Parkinson's. treat specialists disorder far and in on it that's the the they a physician’s growth the and there of neurologists? is the message specialty. office And physician, delivered actually on different XX% how last depends positioning, movement that as year. So, top little as general or depending really And itself sometimes they discussion Are the the it practice, their are the

it. a education But real that of overall, that education on own, the issue helping occur lot physicians that are the that caused about discuss aware up lot is there they are not don't physicians a patients to don't medications don't continue sometimes perspective, their They issues dyskinesia do don't dyskinesia on. from a it, is part we dyskinesia. actually about might the is of by of bring and of they the and actually therefore it, market to physicians they they the it, think to Patients talk has really about disease ask ask raise they

sure the education patient that the try up is in between physician. conversation make in So, and the we improve marketplace to the to brought the

to So that need the it be here, efficacy levodopa/carbidopa and agents product a the the with, off tradeoff aware actually an that can a need between the be of not really only there what Parkinson's of issue. but no specifically treats have for there and we're of these fact treat treat dose people is get about is to that is dyskinesia to reduce It episode, can levodopa/carbidopa, really a is talking there it lot here or dealt also the taper off of of rid no dyskinesia. physician

dyskinesia, episodes get same also always the of can to GOCOVRI even at treat but efficacy You add time. the the

they with the So, it's really great a GOCOVRI. beautiful if have solution understand they the can that people situation, results

in of uniqueness for benefit the of the the continued continued And far, far So, positioning marketplace. in it's and speak market. as product holds push so the matter continued that think the unique just education, a results its GOCOVRI I and that as themselves,

Jack Padovano

Do requiring of terms Qelbree. of versus And have or on ask becoming permissive the are could coming prescribing you with now patients And breakdown it. still increasing I stimulants or you're from naive those payers prescriptions volumes non-stimulants? are granular that more in switches edits? getting are where Got with more then step if from just one a they

Tim Dec

on the business switching to existing really Yeah, of it different patients from And so source medications ways. regarding XX%, Calgary, adding the But patients. new of many medication. the from business it's the is the cuts basically or Calgary about in XX% remaining existing

switches A non-stimulants. of stimulant driver to it is people to very, the look the is looking due the the put of all source and that XX% the coming top AEs a In the drawing business, controlled of actually lot from lot is of switching AEs parents that. actually we of on fact. on willing kids the their kids you coming is major not a from one when from as encouraging XX% switching patients at And of it. And actually very the that the in stimulants, the at themselves, side. And it's side course, also or pediatrics, of mainly of behind substances and are

be very time way So, forth, by then far we it that we really trend the and mixed in to from encouraged are mean, the payers edit I started a continues product step in and peas as the even bag. and launching it's this and And so the as adults.

we contract so it's had, is PVM actually through. first The no tier step two preferred, there

minor The you if through. again, But second the say about of market, is it has let's XX% stimulants. one a step think

that's through an you have if not So, stimulant, much to a issue. of go really

are weeks to have the might first on you through or when you until three your clearly. non-stimulant, Calgary If dissatisfied weeks, with four just by non-stimulant delay a go it whatever, initiation

work getting the formularies, improve and and this previous have patients or step-throughs plans, So, to medications that Pas, so can question of Calgary. the on we my forth. through on things different is back go a to that bag to and on before previous of to different minimize different mixed some to different And answer is coverage we keep it step-thoroughwort continue the

Jack Padovano

you. helpful. Very, Thank

Operator

would back questions, further like comments. Khattar no Seeing to now to it turn closing Jack I for

Jack Khattar

growth our call concluding to priority. would like returning afternoon, In I this top to strong our emphasize that is

Trokendi despite typical insurance performance the We due with the in first significant are generics to the and erosion XR headwinds. of very quarter, the pleased of entry our

loss to We products coming exclusivity revenue in XXXX impact us are of and Trokendi operating confident and of growth will offset XR, our from beyond. to allow income and return growth the that to the

much for to forward so call. look this us Thanks our afternoon. next you joining We updating on

Operator

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

You disconnect. may now

Supernus Pharmaceuticals (SUPN) 9 May 232023 Q1 Earnings call transcript