AYTU - Earnings call transcript Q3 2019

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Operator

Good morning, everyone. Thank you for joining us for the Aytu BioScience Third Quarter Fiscal 2019 Business Update Call. With me this morning are Aytu's Chief Executive Officer, Josh Disbrow; Chief Financial Officer, Dave Green; and Chief Operating Officer, Jarrett Disbrow. Aytu BioScience issued a press release earlier this morning with details of the company's operational and financial results. A copy of the press release is available on the news page of the company's website at aytubio.com. everyone conference remind being to like that is today's recorded. I'd earnings be of access using the today's replay available code release. call in replay A and will by numbers the provided press telephone

Investors of archived your webcast attention to at be the & In addition, call. page, the I'd replay Events conclusion an under following forward-looking call conference statements available will on information. certain company's to the this The aytubio.com, like Presentations call disclosure the customary expectations contain including Safe today operating Aytu beliefs, forward-looking strategies, regarding statements, potential results regarding Harbor goals, will future BioScience. conference and of also

Although factors, result to, other of today, a future Aytu's undertakes information webcast may not management differ set estimates, of May I to revise SEC. on to XX, at based no longer the filings no XXXX, materially risks, Disbrow. may performance. as Time-sensitive be are statements turn factors time Josh any in or believes Aytu of telephonic obligation are limited accurate of to forward-looking call these update any the the reasonable uncertainties guarantees replay. as assumptions and the results projections statements Actual these not the now statements. these with CEO, over or company's and including of but like forth

Josh Disbrow

quarter was outstanding speaking this morning you an with in the Jess. you, be results We're morning, Good of the to Thank company. what pleased everyone. sharing for

prescriptions It and Tuzistra coming many. our the We're the fiscal Further, got out fourth we pleased are and revenue look executing We're around. quarter million, momentum both and to For several better used stated operations. quarter, net significantly Natesto contributions company's we're doubled forward the all strong XXXX MiOXSYS. to even and net very was there than units, reduced cash and all-time having revenues high revenue the of year respect quarter March quarter against and last sales-force and approximately XR our $X.X financial were posted ZolpiMist with operational highlights strong, ending meaningful XX, over the launched our a we in from last through company revenue; grew of quarters we the approximately objectives. and positioned year of With how this now into today. this the over

burn revenue First, XX% line we're growing nearly same year, million, an of us we $X.X base. performance financial the ended last to the expense the high on and provide specifics sequentially. a $XX putting quarter we shortly. all-time on million approximately healthy achieved quarter revenue runway cash Dave the similar XXX% Compared balance a $XX our a with cut nearly on up on and Also, sheet. will million

growth over We're new units more specifics, to some our while Tuzistra and of and the prescriptions, year. over as Rxs our implementation a support came of captured through gross total Direct, and the we refilled commercial quarter improved And share increased XR for product and the This combination of following patient than XXX% Natesto pleased Natesto growth we've and last with quarters net. same program, dramatically a momentum ago. just sales-force. with continued Natesto shipped the quarter, Now quarterly revenues lion's again did of contributed revenue this launching Natesto the through sequentially. revenue this grew product Natesto we four

Direct acceptance patients, by expect staff. and growth, the their given of We Natesto physicians continued broadening

to Study results, an the Natesto's a relating treatment published exposing as expect establishes highlighting Spermatogenesis with to studies, Natesto on Tuzistra fully capitalize the ongoing clinicians to the launch after able the in also getting respect unmatched we the as over the the to in second cough Natesto clinical The has head-to-head got efficacy We season. gels. the quite grow more the two well. gone top despite Low XR, more had testosterone both for were into replacement. And sales-force as on share profile half season field to we preference clinical of the patients' that, January. dataset I'll started, and growing well of recently some believe, field With into T by already clinical

late season them the Tuzistra entering back our many pleased about we last first we're Having how writing was While of have in we'll this cough get fall. again. muted than previous numbers, more season's enthusiastic the the of and gotten front laid to writers are near-record groundwork full season be season, in

first sales-force's I expect in full channel onset contribution that, of as to this this owner. of the With had the mean, the we team inventory first the even be is during the and bag. was quarter, issues need a fall from quarter, addressed assumed out winter. full ZolpiMist the better quarter By prescription growth made product revenue previous and didn't colds, which coughs what do we in this and getting to solid the ahead also ramp and

Going ZolpiMist in have With outside forward summer and back Natesto close out we'll that. on by has the comments providing winds U.S., a and late activity ZolpiMist spring Tuzistra the our and will in color now, promising months turn towards fall. now that, shift the and my and deemphasize cough Natesto to one-two Also as solid Tuzistra, some more season occurring down. ZolpiMist the sales-force with and punch I'll

product I'm quite MiOXSYS Finally, doing as pleased remind that is performance, it well. relates you to to our

MiOXSYS of MiOXSYS commercialize used and proprietary countries Very infertility MiOXSYS the installed footprint XX is you around is now and believe recall, continues our MiOXSYS the users the of our of breakthrough and stands over this we oversees. Canada, largely male simply, the As we world Mexico. test. Australia that diagnostic MiOXSYS in add number assessed change base device routine now to infertility approvals targeted the to is managed. way expand to has in network and the And distribution largest andrology interface to EU, Europe summer fertility-focused there assessments. we awareness The and and conference accuracy with MiOXSYS demonstrating business. spotlight being And approval be expect at use our to data scientific world. this and the on in countries the efficacy the fertility latest leading travelling We'll proud and world's of urology expand. within are have the we're progress its a clinical ESHRE, the business of continues this at made to to growing in academicians and

results financials. Before now our detail around to getting Natesto Dave let into it the to the in me clinical over ZolpiMist more global cover activities, Dave? hand

David Green

filed joining you, quarter results XX, of thank notes ended SEC X-month the morning. our the that for ended us I'll XXXX. housekeeping of quarter Today, fiscal this XXXX A financial review you Form today, for report. March X- X/XX/XXXX. third and with Josh, the for year before couple Thank results. XX-Q this filing periods contains That we our and all our third Earlier full

million can issued for and summary section QX million, morning third months with report, release quarterly QX the The million stronger Gross also profit stronger is compared XX-Q our Sequential for of increase. the to product and offset lower And the up million per improvement financial by loss a products. in gross profit is $X.XX release, margin across higher XX% expenses, represents of found website, resulted We sequential QX. lower or Tuzistra record of primarily to a and of $X.X ago, revenue and XR. by QX higher for representing to was a our was to $X.X last quarter same the quarter in than the impacted includes marginally million which for summary one our XX, attributable attributable for The QX $X.X for The times. is The quarter recorded Investors March ended statements operating a the press totaling our new quarter $X.X our partially operating million sequential $X.X XX% another for million revenue share. loss $X.X XXXX operating was $X.XX and the from $X.X financial product QX results. higher for negatively increased also this QX lower than results. last Revenue which loss be both press million gross $X.X QX XXXX write-offs now, from cost, www.aytubio.com. recognized same nearly million launch revenue over the $X.X the loss of XXXX XX% Net portfolio. ago million year QX reported year, the million QX The which was X was revenue quarter $X.XX profit year. revenue Compared X growth than Aytu. QX XXXX was discontinued QX

first operating used used operating approximately in flow to the was for XXXX quarters less activities $XXX,XXX largely which higher quarter. period activities lower the Net while was of is $X.X rate activities operating $XX.X product the third Turning fiscal of in same burn quarter expenses. cash X and than XXXX. the in million, $X fiscal net million, lower million statement, cash cash cash due was than for used Reduced controlling was which revenue to cost, the last

Turning million the a we ended million of of QX. to the sheet, to $XX.XX cash compared with balance the quarter at balance end $XX.X

of approximately subsequent million company. a increase important $X.X we of up shares and to X.X in bearing outstanding interest all eliminated the of Josh. with event, that year-over-year, transaction that, and $X warrants and debt, continued million was million interest. summary, a strong revenue the back exchange interest-bearing accrued turn an issued XX% elimination XX% sequentially with million reduction call and an our burn with reported Capital exchange, another we connection with profit, nearly X.X quarter interest. and the all related And debt approximately for Finally, the in progress Altogether XX Armistice forward in accrued and I'll and debt over gross QX nearly eliminated In and

Josh Disbrow

speak It and Getting the quarter excited momentum. this current a well us puts $XX that. across revenue run rate was we're a about solid financials the in obviously us position a the great million company's board you, Dave. for and quarter, to to very essentially Thank

of clinical Natesto. the I'll surrounding development speak to recent Now, some

would field impact diminishes a in while the Thus, University X-month Study Ramasamy's product have or still published are X-month the remind unchanged. statistically groundbreaking on Clinicians hypogonadal month team, this peer-reviewed XX XX minimal Focus, last their and demonstrated treatment now now you study months. in journal the X, Interim in disables X entirely boosting Natesto As treatment or field. levels. understand in the month parameters well that that no update that that at whether data men have you cases in Spermatogenesis European remain the study and and seeks potentially aware, very completed testosterone and in demonstrates both underway. Urology semen well some been completed conclude Based of to Natesto have be T men. completed fertility all fertility provided testosterone XX maintain by to XX enables Dr. and patients men have this I X potential, treatment likely patients Miami the have period. study enrolled is men, the research been of fertility on

and on completion this we Specifically, motile need up. period to patients' remain total count their to the of and months sperm X-month now six Natesto enrolled sperm normal, the sperm upon patients while treatment. motility on study Remaining wrap treatment progress summer expect concentration,

depending we'd publication Following expect on thereafter. men from the to plans see fertility that, preserve The Ramasamy, the Dr. results. conference benefit of clinical their years public could seeking and family and formation uniquely X-million-or-so made during hypogonadal these results

group the reproductive-medicine to completion. be as the are about for to available men. Several fall. follow only this excited More we're related scheduled nears to large conferences Natesto's study potential testosterone the So of

published where in learn authored presented the in So two key by front, Dr. his data on and on to Natesto. colleagues, Ramasamy and the Two first-ever we'd clinical additional demonstrated publications also be Staying may online publications Urological head-to-head with on reported Natesto. reporting Canadian we excited final published team. by Journal and factors be study Lee Jay Association the clinical several

to gel, topical XX% AndroGel in significant a on Low XXX improvement patients men gel preferred Natesto being on improvements and average after days some Natesto when of XX from over a previous majority for Over actually switched switched over XX% preferred patients their having T and of effectiveness. in in vast experienced years. been their for on after First, were Natesto to gel XX% patients the the treatment. Natesto like overall cases, symptoms, Further, who their

increase Finally demonstrated topical the is to of and course safety treatment. notable [ph] a their an during of hormetic gel most their who on Patients the related perhaps gel levels are in Natesto.

results safety hormetic of key in long their this treatments. considerations in went a these a stand study, what first clinicians market we to is reported to the will the to patients, were emphasize switched so unique. [ph] from believe with testosterone However, Natesto, category, data, data These middle when other T improve into back safety demonstrate from goes makes other of highlight Natesto, normal to conjunction to continue to way Natesto are payors, of aspect this with as previously again, in the the important men range. back T set actually of levels This when such we the as and yet an aside gel and treatments. Natesto down, Safety study well the Low the Natesto position may compared believe

any deal of of they been expect more approval. royalties and our approval, We'll footprint. a Steve sublicense has sublicense. any purse commercial world, milestones, U.S. in Moving announced to announced of perpetual benefit they make. for outside expanded investor. very out knowledgeable of obtained In sublicense Mitsubishi sublicensing sales and has deal, Canada. rights with appointment recently history, and first submission already to And covers result important attract and America, XXXX upfronts, one China portion SUDA follow leadership closing, to of from around ZolpiMist, and with outside of which he His the investor royalty-bearing the a to markets sublicenses joining Asia. global through Pharmaceuticals. will the put rest-of-world will announced our early in a SUDA Southeast Australian eligible our Capital. caliber U.S. of their whereby the quarter of this would the a and a all healthcare this the future an well-respected is the in Steve now is South an healthcare of TGA Through receive in be and team. point to marks that agreement builds the as and and partnership for Aytu to be Directors the ongoing recently with SUDA and Further, SUDA the major Tanabe of commercial we we a would Board. approval able receive Board just we've Boyd Armistice to like our This country-specific we SUDA has portion if deals of regulatory ZolpiMist respected the Aytu to sales. professionals commercial the ZolpiMist term the institutional allows portion high formal for Board ZolpiMist founder milestone-based place industry And to this

this we're with prepared up providing now lines. quarter to lines and additional remarks the open the forward pleased open ahead So we Jess, and look updates, to we'll and from accomplishments for phone many continue as our the execute. questions. go pause With complete,

Operator

first Thank Thalmann. Cohen Instructions] [Operator you. go to Ladenburg Jeffrey of We'll

Jeffrey Cohen

you Hi, doing? guys. are How

Josh Disbrow

Good morning, Jeff.

David Green

Jeff. Hey,

Jeffrey Cohen

little Could may because about you to a could what bit little us that that Tuzistra via bit? So the schedule talk expect, you'd to for and we believe be a advantages talk XXX? about be you

Josh Disbrow

I'm XXX, missed that sorry. of I question. the part

Jeffrey Cohen

II Schedule III for Schedule the Tuzistra. versus Yeah,

Josh Disbrow

Jeff. you, Thank Yeah.

on. up picked subtlety a you it's So

this important I think as category. that's we move into

based Schedule is made you is season, But subtle. as by a full opioid most obviously, nice quite prepared really those long-time into off market cold So, it's Tuzistra in inclusive has point We substances, the scrutinizing it a II first in heading II and of my DEA And into fall, III Schedule really XR. now wind And I late our the around cough sampling We'll, sales, Obviously, controlled noted fairly season. products, the in to the of in January, being DEA. incumbent the ahead start. the field our got Schedule products. acquired got get acquired where obviously, see the begun have can and being the and frankly market a versus we Tuzistra a to of it specifically prior very relevant we some remarks.

for states the practical many Schedule a a formulation, primarily that it safety extremely cases that, the long-time providing be incumbent. more polistirex component obviously obviously codeine not hydrocodone-based some contained like while II, offices. whereby they can So Interestingly in XR to is making which Tuzistra more readily does Schedule the has a they difficult easily, important to a physicians so related than is write Tuzistra to could like there's also the the their more Tuzistra that is little about a dosing significant release a example, a Schedule say, What's inclusive products XR considered contain and III, physician that marketplace. challenging, because advantage extended of In III fact, Tussionex a samples is element of market in Schedule II, though, actually maintain codeine, and of in a hydrocodone. prescribe in in dosage, is because even it bit

access patients So III believe, relief it Schedule perspective. the versus alternative cough Schedule get a better to better product. enables and a as safer we It a pharmacy to get us well, with offers, enables ultimately to physicians access II from for from a

field So, we as cold elevating we'll months, get we'll the showcasing back that we out that, and have get here obviously cough following into - the begun season. begin summer and into

Jeffrey Cohen

Okay, cough know, how or guess, cold know, next, is year season. And mix about helpful. your my question portfolio. you I you you then, talk generally wrap you specifically very any That's do a over expect seven got down I got six little without bit? out quarters, the break rolling and up that to it. don't But can I the speaking. about

five Thanks. as mix talk is like and little the year. configured? looks in composition got a maybe that currently You And four, far quarters about the early in what the as

Josh Disbrow

Yeah. of that - is rightly coming and season out Yeah, cough sort we're pointed cold out that. you of

say annually expect with big Tuzistra, next annually. our and of balanced each opportunity revenue to fall, we be player the we story. a continue as we and what by forward. company. plays, a significant as generally Not XX speaking, Obviously, just impacted written be that, would of prescriptions Natesto into we a our is, of Gross obviously impact by more in get nets, well. mix. specifically frankly, think a percent more I'll But part over be it's to product guiding we in we as will carry But a So, as big expect obviously portfolio the going Natesto, balanced overall for positively forward. That water we go build will the written is sleep large lot U.S. Natesto contribution. categories million million really significant ZolpiMist between they to what XX antitussive aids a million and XX is There virtue There compete expect to a to

market So large category what opportunities to Rx million and X complement, category. the testosterone is about very

while in quarters So price we we contributors those lower be Tuzistra points is as There and the in are opportunity ZolpiMist meaningful ample categories. out grow. to the think

what So exactly that you terms in at what. least hopefully gives sense contributes giving of some without you specific

Jeffrey Cohen

may, basis. generally about you Okay. more, bit And talk think like, talk this, one could speaking? a about it And mid-teens, sustain I Should sequential this quarterly could that we basis? you be on speaking, if looks I that growth? Thanks. on generally estimating XX.X% what a thinking XXs quarter; can the quarterly little you was were we

David Green

at very into some a we of But experienced seasonality with XXX% strong; year, nature on the the very, at growth dynamic change due year-over-year, clip. lifecycle. growth, quarter-over-quarter have picture, for rate. quarter-over-quarter, that to early overall, to although, continue rates we obviously, - the year, something board, at continue same healthy of revenue do at not Tuzistra growing, yeah, doubling we this But grow to high year, there and guide strong the very revenue in big But that and next of this we But we that growth. expect same year. year-over-year season. without aspect is continued expect Jeff, very continued a especially expect And the range cough/cold the we stage new come necessarily just seasonal the we've grew the will the and to Tuzistra company of next don't seasonal this the the company's obviously, are, to of getting of of will not lot

Operator

We'll next at go Carl to Instructions] Securities. Northland [Operator Byrnes

open, is line go please Your ahead. Carl,

Carl Byrnes

gross revenue what Yes, of to timing seeing on just expect but follow-up respect a seeing to you're all as quick in readout then, of at a seeing the strong sequential of And accompanying Obviously, with with Can also prescription respect follow-up Natesto. well? the growth, in comment nice net we're total Study? would Spermatogenesis growth. terms And in of that, the growth? improvements terms prescription you're I to you top-line Thanks.

Josh Disbrow

Thank you, Carl. Yeah.

growth fact that most to a at absolutely they're total really nice and prescription that perspective. prescriptions therapy the respect we encouraging therapy. we growth, getting yes, on the we with saw sequential refills, have at, from We which sequential look thing look sustaining So that is and men are that

up even net, frankly So which to was gross a improvement continue significant a see. when quarter, sequentially, in we have we to prescription nice hold in to very very,

we, So Tuzistra. a it We launched with product a had secondary. as obviously, launch

With portfolio get double-digit So prescription QX, position very saw don't can we second frankly getting relating very able major our that would a on a the brand XX%-plus any still but net. net across and your the the of gross maintain by Study, so with the publish resembles close. that. pleased really Spermatogenesis from question we're readout QX against is of you looking We going up our face gross a Again, of are product, by things excited the that. portfolio. net very to healthy were it so to how to in to that in a to obviously sense, that across pharmaceutical sequentially obviously, Natesto hold gross you growth And to to primary industry,

He from investigator-initiated that little high-impact more that has a study specific. of this high-impact this, We dictated up would timing Dr. we and bit and the a what group meaning, about present the or to specific obviously pin is a in potentially in progressing. difficult and are. target Ramasamy publication his a The how are around a patients summer, this and readout hopes remarks, up we where wrap expect terms is Obviously, journal. be high are do patients it's Ramasamy. a that We down, prepared really to by such to study of framed high timeframe we're Dr. him to high-impact excited hearing my an location, scientific driven to precede expectations very conference with follow at data, because study, expect a June/July

keep publication or in of we'll present timing. be But to with bit updated to the study it, readout the removed folks try terms and generally So key presentation submit we'll shortly best having final But a it we'll of a timing. our to access a them little and try completes obviously follow plan terms if thereafter. investors exact respect data appraised is to to June/July that to when of the and/or in there then speaking,

Carl Byrnes

Great. Thanks progress. on and congratulations the

Josh Disbrow

Carl. Thanks,

David Green

Thank you.

Operator

any it closing additional [Operator turn management further I'll Instructions] for looks the And like back we questions or conference no remarks. this have to time. at

Josh Disbrow

via on performance fiscal very to quarter, up, posting you all Jess. our And for last to you, from listening to We those Great. this already revenue the We're how solid you of forward Thank you Thank year positive doubling and quarter. XXXX. pleased looking joined think setting there another a for that QX today. questions for thanks with for to of QX webcast. makes year call thanks and based this we're is the

And front. details update that on So our provide certainly complete there follow we'll on more next to call. is

listening. a and have again for then, good thanks day until So

Operator

today's We conclude participation. thank that Ladies will for teleconference. and gentlemen, you your

line time have your You great may day. at and disconnect a this

Aytu BioPharma (AYTU) 14 May 192019 Q3 Earnings call transcript