PCRX - Earnings call transcript Q3 2020 | Pacira BioSciences, Inc.

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Operator

Good morning, ladies and gentlemen, and welcome to the Q3 2020 Pacira BioSciences Earnings Conference Call. [Operator Instructions] I would now like to turn the conference over to your host, Susan Mesco, Head of Investor Relations.

Susan Mesco

Thank you, Debra, and good morning everyone. Welcome to today's conference call to discuss our third quarter 2020 financial results.

Joining me on today's call are David Stack, Chairman and Chief Executive Officer; and Charlie Reinhart, Chief Financial Officer.

me based that on let include call begin, statements forward-looking concurrent we remind today's you will Before expectations. Such of statements uncertainties. today as and may represent involve risks our judgment and

please that SEC, over the are to the that, available or affect factors I filings SEC which risk the David website. concerning the Company's Stack. information the For call Company, our refer from will to with turn could With now

David Stack

urgent how quarter Good to morning, continues to opioid-sparing everyone proud and results patients our for highlights. need you I'm business incredibly us economic and third in nation's to -- remained opioid an Pacira pandemic management. Susan. opioid thank review for crisis rising joining alternative as The our has fatalities, facing related with disruptions health, nation. more you, Never pain drug of given our Pacira financial to provide advancing our before COVID-XX social recent steadfast many team the mission and has possible. the Thank XXXX of a there the number as been escalate

to-date to shortly. our patient the meet PITT, detail I efforts ongoing during us recent Our state digital deploying We rebound the which a tools adapted order Innovation and greater pandemic. have nimble by care the needs Training of remained of and or facility our this cover interruptions unanticipated of educational to from opening the Pacira solid grand in customers, including and the art position will in of deliver

year. for the on July have morning, sales return surgery a for the to underway grow to with of XXX% of in an continue and will trends and daily of through levels revenue this reported we XXX%; XXXX $XX.X in average $XXX.X sales our as average basis. As continue also million third XX% The Today, allowed million over while ambulatory net and simultaneously in we XXX% August, the adjusted needs increase discuss October quarter, daily at reported transformation margin marketplace to call, we growth model quarter, in the improves. overwhelming year-over-year the date later EBITDA topline, center June XXX%; EXPAREL worked attractive Charlie over last this third September, our in of

in are appropriate profitability with investments to strong a we supporting very We this expense. position operating since growth deliver and are robust accelerating

more flow, solid are the We also financial expectation than internally million financial of a position in cash investments, of in we to the With have our footing invest externally. cash in operating increasing strongest history our both and Company. $XXX steadily and

our long-term, of we trends, with increased remain, guidance. very to we have monthly continue on While ways. we which transparency COVID-XX the in variety the can the to remain reinstate bullish To revenue provide impact business preliminary will visibility sales around insight report for until intra-quarter you uncertainties and a necessary

now to strategic review the Turning of business. a detailed more

across The was pillars. financial third strong growth highlighted execution three quarter global by

strategic as the million First, well approved focus iovera pain that positioned and solutions. With remains patients with analgesic partnerships long-term local is pain only health second, than United and field EXPAREL the for acquisition infiltration brachial pain neuro a and nerve block to block. of management; innovative launch, EXPAREL. more and the States robust non-opioid by and management opioid-sparing regenerative start the X.X customer for growth of on pursuing expanding targets advancing top-line for leadership delivering in pipeline I'll journey improve since patient use third, EXPAREL long-acting treated plexus the pathway; market

compared growth have in these not But normalization. full to headwinds, average XX% sales recovery hitting we since XXXX. key April. the bottom have Despite daily states EXPAREL quarter third return achieved seen of We a show seen signs the to in

growth. partnerships and elective data the procedures by we Importantly, to in We and further pre-COVID weekly the this growth oncology well to those down XX-hours XX% of normalizes, the broadening surgery very as shift to anesthesia. surgeries showing the When regional baseline surgeries. to EXPAREL provides The based Less procedures continues opioid-sparing massive most commercial a arthroplasty setting, plexus provides expanding see compare is have research paving outcomes than long-term growth EXPAREL up be Not growth, with the anesthesia EXPAREL I'd and EXPAREL long-term for we blocks information, new patient would and We to brachial nerve States based year. for a to such as environment, there where cardiothoracic training a of only is coverage EXPAREL brachial non-elective by than for migration state per the as only current expanded robust February, anesthesia surgery strong benefits it and utilization of upper XX%. is positioned quadrant, field addressable procedures cuff block in market from We rates. accelerating risks procedures few C-section, elbow facilities. anesthesia. as more three EXPAREL A EXPAREL and complex nerve plexus market a the million surgery shoulder the growth market local with recent consistently and not rotator revolutionize mid-October hand of market. the EXPAREL Through procedures. surgical pre-COVID and fundamental the is our data since stay regional mounts is group exceeded EXPAREL and you, using expect inpatient plexus or particularly block of is but opportunity. weekly nerve use brachial a well the demand. of to variety rates an way the roll directly With the key United network and procedural believe an and XX% claims educational this To the approach. highlight our procedures for a also of of remind elective around like shifting in XX-hour basis indicator block practice data are playing block that are this block for to satisfaction and initiatives, significant when markets regional this complex of continue as demand a correlates implies seeing are the approaches. administered as training awareness significantly IQVIA the of revenue of elective to XX-hour we

consistently the reporting infiltration results. and administering but the are not are avoiding at with clinical block case. only prefer Surgeons customers preoperatively Our brachial the end plexus they impressed outcomes, positive a of

of from blocks as strong of vehicle advantages replacing of catheters, anesthesiologists setting a and antiquated by XX-hour become in to and the shifting often procedures place prevent the the Our using taking procedure site which care. customers a dislodged ASC see pumps

are from surgeries where blocks procedures Transversus and per significant Additionally, as block elective to EXPAREL space. colorectal migration the success region. shift driver. the ASC at with year abdominal brachial their of are environment block, door for to supports environment. providing an a these abdominis the additional than TAP care. by field having employers broaden high an --. is drive -- to the With million we consistently is elective And market also we to want is expanding single-digit penetration, a a growth are that the payers is plexus surgery abdominal long-acting self-insured more use EXPAREL anesthesiologists is we for -- With health blocks, opens single-digit where use for or penetration, and growth six especially important use be this COVID improving expanding only to Women's continue significant expect After high to outpatient TAP An area EXPAREL be inpatient reimbursement driver. in important in ASC control procedures pain of and EXPAREL

become will in We are women. abdominoplasty, opioids addiction persistent likely institutional an studies anesthesia take shown Pecs TAP options. the a reconstruction driven newly following great for is component pectoralis for standard with alarming women and example EXPAREL oncology, gynecologic be women of cesarean of growing managing a significant users Opioid transforming surgery. sections growing breast among and at and how are that in more to EXPAREL rate seeing procedures. and protocol are There mastectomy a non-opioid as or section, pain women for XX% blocks care is demand hold be, key of have Cesarean based

our who prefer pandemic. Most Phase studies successful the stakeholders two opioid-sparing to benefits for childbirth are experience. the relevant an blocks. We the data for during based EXPAREL This is women from TAP COVID are navigating pregnant about educate using of opioid-free especially moms

only million market thought using the women's we Pacira health providers this procedures for world year of forward. EXPAREL. infancy So just evidence United to States. opportunity the mid-single-digit act see tapping enormous With under as penetration, is comprised this market women leaders remain and real in moving from four of The with healthcare we also physicians, to per in and drive an

Another shared cardiothoracic the procedural and IQVIA year, a key based producer, procedural on are with EXPAREL opportunity in to on key all I you, remind investor C-section. similar target single procedures market see is where we procedure major are a The I the digit we for growing revenue million X.X penetration the accounts have just receive touched summarized are a deck our six-month claims label. These and lag. on the on data To data, website. markets data other utilization which just we on

further broaden the are of we EXPAREL initiatives, on-label our to reach Beyond label. working the

with working new to PDUFA FDA EXPAREL March review and the Stage supplemental The is set drug older. advance are their XXXX. for six and our seeking First, application date patient we of approval of XX, action

and process. options given difficult access envision cardiac mainstay is especially children, pain post-surgical parents a approved approved and and components patient on positive Further, will -- non-opioid we of part population. with EXPAREL With Having critical Our long-acting local significant in only for of procedures a need million per currently only is unmet postsurgical opioids believe this where the unmet the and the need based from control, in be it pediatric for pain $XXX market when submission to decision undergoing to opportunity. one management be pumps analgesic, on our study to importance, significant spine year are managing postsurgical children for are the million a the pain place see of surgeries. data catheters vulnerable label this approximately we pediatrics limit

extremity lower also include label nerve pediatrics, expand EXPAREL blocks. working we are to Beyond the to

to nerve foot procedures Our patients as Phase is a and enrolling lower undergoing X block study evaluate bupivacaine ankle patients EXPAREL in surgeries. versus adult STRIDE such extremity as

around We market. currently data upper line extremity end significant as and We lower approval the the in extremity least as market XXXX. for believe planning quarter at of are opportunity the is first top the XXXX, early of

variety a to European positive and September across In issued opinion continue States. our of the United approval administration settings the also outside for surgical a of EXPAREL techniques. agencies advance for We recommending regulatory strategy Regulatory EXPAREL

opioid expect and opportunity forward in of bring anticipate final Europe. are labeling launching determine decision to alternative to we We surgical regulatory next a with patients to partners EXPAREL We next possible our to We effective the Canadian steps a the discussions with year health the China in the working authorities safe along next middle and with month. around look and iovera process. in Europe we and across remain

to Synthes, approaches Moving in transition with of as continue now we agreement -- a its to this smooth support counterparts this XXXX. our our in to collaboration with agreement DePuy conclusion January work

to we from PITT. is recently sites PITT Center market rolling element capabilities and out and critical our with and -- XX-hour an investing education and or didactic anesthesia pain innovate of format driver designed additional Switching collaborate, materials feature in blocks. a management an and towards facility workshops. complex innovative of thrilled audiovisual optimal educational anesthesia important the also the virtual The input critical techniques peer and training EXPAREL support of transition for EXPAREL regional a the in-licensing has events field Tampa step and live open this the and Innovation creation are was in clinical in our are and care. as equipped based leaders world-leading and of migration more the partners. orthopedic to continues presentation adaptable play can experiences nerve we where are will become anesthesiologists assets. to in critical as to state is as differentiates that been major support management PITT's to to opioid-sparing of hands It partner to will facing move iovera. choice other procedures surgeon simultaneous Pacira innovative physicians on with driven This technology this of interface growth investing for art who we Training for field. are The important recent for range pain Key a such have and a enduring future regional the using growth resources We this role to that in allow with Pacira to the educational with peer new PITT environment of EXPAREL each from share leading regional much guidance This of and pandemic. This in and educate will to based the a forefront anesthesiologists this the continue The facility with gears approaches. protocols customer

you we in our the kicked As February. after off know meeting of iovera relaunch national

within represents our commercial and significantly and technology horizon. initiatives potential delayed. this innovative highly sales clinical Given $XXX opportunity behind planning significant been the impact confident system with We COVID-XX, in the have of five-year our approaching commercial mark the it remain million the

we to near-term have tool arthroplasty orthopedic total customers our to this by to their pain patients for by unfortunate Given osteoarthritis, adjusted opioid-free support been proven delayed COVID, the as surgery impacted knee and gap surgery. positioning impact iovera management who strategy to unforeseen commercial a and due have bridge

iovera can non-opioid prepare is opioid-sparing management pain knee to enrolling total surgery with the of PREPARE EXPAREL arthroplasty. for front, iovera, for On for patients With evaluate several and iovera patients undergoing clinical months pain control. patients

also leading EXPAREL functional will post-surgical provide have arthroplasty leaders experienced continue to in across an using world treatment expect TKA are of anesthesiologists of to and a opportunities, opinion iovera wide procedural iovera evidence such great Key pain, academic registry capture knee use solution rib plus rapid and iovera thought with procedures real back fracture, where developing for as We more pain have excellence. recovery. leaders a range the we as of guidelines. parallel, for In launching low treatment experiencing total that in and centers interest orthopedic spasticity a -- spine, these

these studies to investigator-initiated develop and use data grants will We across areas.

technologies and Turning our that further and align now leverage our pursuing second with to established infrastructure pillar, to our mission products us innovative or P&L. allow

and a health along non-opioid to shortly. We regenerative of solutions to believe opportunity control journey surgical portfolio anesthesia position audiences. that to differentiated a we improve of pathway are to us patients, are pursuing thoughtfully provides significant neural additional opportunities build discuss our providing to partnerships expect have and opioid-free We our leadership pain interest to the the and you and patient with that with

our pipeline non-opioid discuss let's acute chronic Finally, opportunities pain. our third for pillar, advancing of and

is team safety, leveraging in-house proven customize our focused DepoFoam Our and flexibility on of the ability platform.

program a for We are of evaluating an two programs for delivery clinical development, subarachnoid and intrathecal local anesthetic use acute Our is pain. DepoFoam-based lead in or chronic

involve in a next study X no-go which on to bupivacaine EXPAREL make of -- with -- which [ph]. phase the go are We next conducting allow will a pilot development, decision Libo the Phase would Depo us page

And next of for like forward to Charlie, stage a turn Next, we over a pipeline. clinical dose look are the early our that, steps with advancing progress pre-clinical finding determine with call review We studies financials. development. to a and to review the you to appraised of dexmedetomidine keeping these for I'd

Charlie Reinhart

and you, morning good Dave, Thank everyone.

of echoing growing in to Before care. only be external procedures briefly opportunities sites positioned press and business hospital results, of generating remaining for morning. invest more of and with GAAP measures Dave quarter states fund principal and business. of and Furthermore, ASC to track our I'll our amount metrics non-GAAP as remain top levels of organization leave setting are the emergent to repayment fundamentals April in number hospital and of be remind the We September we very this investments. accurately the begin we by growth nature reviewing issued third which to our release reflect the and strong with we you confident normalize in found line are capture that this discussing cash we inpatient, elective our shift. our the will business and strong outpatient bottom future approach accelerating $XXX on internal saying, more A The I'd believe financial to with has like of that and in reconciliation results. this to can description increasing morning, of our well along these well mission. our the to equipped and ASC notes foundation growth XXXX of is us in moving and accelerated the align ended million cash continue This COVID-XX than the both procedures I

the XXX% approximately XXXX million revenues of of Net of $XXX.X million, Third total quarter XXXX. for third was which XXX% quarter of product were well. quarter of revenue of total approximately sales as EXPAREL the third $XXX.X were

reported we off at of meeting kicked compared the relaunch iovera, XXXX national net third product for February. for in $X.X We quarter million as XXXX. million $X.X of third to of For of iovera our the sales quarter the

interrupted However, setting COVID-XX. to in the outpatient TKAs mid-March launch when due in was the hospital were postponed

to focused an allowed our with surgery. pain solution those awaiting opportunity still undergo However, to many to effort that's of patients have iovera offer us

iovera our XXXX, manufacturing driven The suite was the research pediatric Non-GAAP our expense completion and decrease studies. were and versus offset margin for EXPAREL partially gross decreases in versus third of quarter XX%, XXXX. unplanned of million XXX-liter our section third the support was a of XX% XXXX. cesarean change related to of advancement facility $XX by development These at third the XXXX in downtime XXXX development that margin for The quarter a million new scheduled of gross third the some quarter cost for XXXX, primarily EXPAREL during primarily was to trial. downtime and in third and lower of non-GAAP versus $XX.X Our in San XXXX Diego of facility. units was the of sold at period by the the quarter the of UK quarter

study extremity block our X X study Phase and of Phase nerve EXPAREL via intrathecal pharmacokinetic injection. lower Our

the partially million directly conclusion of cost and This virtual expect in-person In XXX-liter Swindon in transition EXPAREL due in base year-on-year third versus XXXX. is pandemic. and we meetings, the percentage million at the with DePuy the percentage high-single to the on of from as not than reductions R&D growth, this prior we our tools costs $XX.X our to To of in the a the comprised from the in which capacity business Commission, addition, The the cancellation have agreement other SG&A registration impact partnership increase the COVID-XX associated third year's quarter primarily Prior XXXX, travel expense commissions, the by would XX% suite translated small fee sales. medical into specifics expense co-promotion are the COVID, with while was net renewing reduced bottom to DePuy line. conferences our of Synthes. to of non-essential XXXX, larger percent to of EXPAREL for our conclusion is a phase remind $XX.X it manufacturing facility of linked to development were with a approximately disclosed use and attributable digit spend to sales related termination you, as well lower say to benefited on quarter of positively phase. of that expansion Upon growth. sales Non-GAAP the the offset

non-GAAP of of XXXX. million quarter $XX.X All third adjusted resulted in XXXX the of this $XX.X the in million third quarter of EBITDA versus in

income tax deferred results included of million valuation an the $XXX.X for Our asset GAAP our of tax allowance. most of financial quarter benefit third reversal

assets, to operating deferred increasing As margins of income growing our given revenues, concluded that sufficient will have likely modestly expanding only taxable generate XXXX now expenses. that our and result results, for we tax operating is these realize expectations a we

our taxes offset US to US of the need tax pay that the deferred to continue XXXX. We will the cash until assets half federal of second anticipate utilization

around Dave uncertainties mentioned not we given guidance XXXX restating As today, COVID-XX. earlier, are the continued

quarter We to you. trends preliminary the report sales will product monthly share continue to in with

impacts have have more as COVID-XX. that changing will this visibility consider around We of the practice we we --

anticipated growth make overview, topline back all over high-teen very story. Looking remarks. operating appropriately out plan five-year margins, a improving turn growth to call the long financial unchanged the expenses, the for Dave, Pacira rate, With combining steadily with let term, annual our to that EBITDA exciting his managed me remains closing

David Stack

that for Charlie. you Thank review,

a are current positive difficult and have indicating We through trends rebound. market time come a

will the continue market, of our number remain to always its We priority. on the safety and remain patient employees monitor one will the care COVID-XX impacts and will --

coming ahead in we label have look milestones we value reporting months, expanding forward As over franchise several US extremity with and expect our results study full EXPAREL the We our wind look we regulatory of creating pediatrics DePuy taking the down securing as to to partnership for the achieve. lower approval and we line ownership include nerve to top EXPAREL from Synthes. block Europe,

completion registry the and to data front, becoming have we the available the next prepared iovera On of trial iovera our the from year customers.

financial achieve earnings over a teens, steadily have the quickly the managed line call begin top to turn to are we and transition mid-XXs from equipped percent our high I and we to to with And well the story to powerful Deborah? from with which session. goals foundation the into that, in our Importantly, improving a growth Deborah operating appropriately Q&A margins expenses. will mid-XXs year-over-year

Operator

RBC question you. with Instructions] Your Markets. Randall Stanicky [Operator comes Capital Thank from first

David Stack

Here you go.

Okay.

Randall Stanicky

Can me. Yes. hear you

David Stack

We Thanks. can Randall.

Randall Stanicky

Great.

if still built suspect, an roughly level for some going become next consensus, don't to I'm XXXX stock. growth look to that's the not for implying the and/or as year. issue for it's to guidance, catch same XX% you at so either want this So in you pre-COVID but normalization I volume for assumption at ask I close up,

us be know questions getting Pacira pent-up a do how And next And path So I it's question. can can you're thinking of market first That's XXXX? as lot see I at looking about you David, the including is Charlie. whether or a big one. I do into guess, provide around much for normalization demand the would transaction. I'm mean, large for recovery that going could secondly under to you vaccine scenarios, you year. some various how quantify and context a in the a

provide helpful. business to Thanks. context as development, would could that on be thinking current you your If

David Stack

Randall. Thanks,

thinking that, be the first being I are is we're in guess, believe of that wholly over that the question The still what we procedures done. XX% grail, is delayed will

XXXX So lot how to a to Difficulty]. on [Technical going preparing over or not, XX% Whether we for that improvement XXXX. depend be a is are substantial it's

Operator

please Ladies standby. and gentlemen,

Okay.

disconnected. leaders Our

You may begin.

David Stack

you. Thank

power Sorry, out building. guys. The failure entire a Jersey. this We went had power in New

everything, So guess. I timing is

part Randall, question of United a second States your of So is the of performance between data, in performance delta of and surgeries this we as is, IQVIA basis. versus the follow a Pacira the elective XX% XX% there the on a week-by-week

year the for What to second the so of some get more elective a a So rebound. you question the quarter from stuff answer into we're as and centers for ambulatory perspective not from center through recovery are to for, it remain where the like answer normalized perfect from is a we're the just C-sections next your for expecting as XX% ready QX. that suggested, surgery manufacturing question. isn't going from we're surgeries inpatient to going like here, we wait. some a procedures the opportunity is being that can getting things something more see this especially that expect resource folks your of and sales we and is do a a this told living, To and with perspective, we help specifically baby But

result of because a tracing. patients to as do unavailable to elective procedures. much the fact by surgery so tracing spikes have we many So surgeries We in become of the the the because being surgery, that see but impacted not the spike the in those of so

as first pads the And the to end inventory forward, are of so and we ready as have issues C-section getting launching continued we growth to come expected at prepare cover especially the for of any quarter. enough we

Randall, at that, So -- specific me have you if on inside a that's not question back context. come if that

opportunity. number On front, transformational we a would we're don't addressing. opportunity exactly we the opportunities how define BD I large of or know have that a a

our But pipeline have financial We would in opportunity, have with even value hand add shareholders. I today, and find philosophical appropriate business real or as like I'm a we for I we that no sit that you of. don't to or the one can that's the large in tell if issue that anything here aware

Randall Stanicky

Dave. Thanks, Great.

David Stack

are Thanks, there? you Randall. Deborah,

Operator

Yes.

with from comes David question next Amsellem Your Sandler. Piper

David Amsellem

Just the it a qualitatively you couple, at appropriate talked structure, way OpEx. is first, you cost least phrased I think about and the Dave, management

to So what deeper of that generally marketing I absence, XXXX -- how that about spend spend. That's the and one. means of any should just to partnership. in a R&D dig and you for of with of think into trajectory course, J&J your any little we in the talk to Can And unrelated sales unwinding transactions. number wanted the J&J, the then

then number in just the as of a that's we what XXXX, going move be So And to you two. is portion coming you lastly, can give us -- sense coming usage into of EXPAREL setting. think from ASC

out think trending of six next the year to months was XX% over of Thanks. say coming think you do that's ASCs. be so? volumes I you early Where something had said in maybe are this around past, or the going

David Stack

Yes. Thanks, David.

second. for OpEx the on from one J&J separate question. So let Well, OpEx me

of since benefit So of COVID result we really a partnership real haven't the had as mid-March. any J&J

of and world the like Johnson if & already if the we've look what So would I suggest everything six partnership. seen that Pacira for for Johnson, without very from at Johnson months and today is so anticipation Johnson all modestly any & there were really that benefited we -- reported

would in Swindon San forward, in to also and result our the a revenues plus that gross a the you both and increase and look margins XXXX over something but is benefit we in later in -- will in be in accompany in of XXX-liter as operating increase margin substantially we that in facilities five-year expense period. modestly XX% planning very coming as strategy XXXX, what the planning period digits operating the expect the mid-single and online, would So Diego see

XX talked about in the people approximately the customer added as and call, we during appropriate So OpEx organization. facing we've

to surgical we and And this and operating in to be year, disconnect itself really of from that being increase spot good are again required. handful get audience, a transforms cover remind the in much a that. need we able fairly there and where revenue update an the we to plan to We're a I'll very exit year having with anesthesia expense higher the for everybody terms between substantial our audience marketplace. cover a ROI, that's so than that more as As But increase. very all it next an into is in a move our

the is spend. R&D Second

in The both have the just our we in manufacturing to first spend, R&D everybody clinical David, that is remind that and thing, spend. --

And San so we're putting another XXX-liter Diego. facility in

I the guess a increase spend slight clinical do, reason hesitate of will would R&D certain a or the result increase and aspects we And that that is, is, would David, there label a what questions do, well, we activity minus there about minus, process label. the or manufacturing spend, European plus of different some in we for plus and aspects it the of that R&D modestly. the what my see will are You expect as pediatric

the surgery So trial. get surgery, get if then pain, spine one to scoliosis for we you cardiac only scenario; example, pediatric do or label need if there and have the then is broad additional we for an

because And actually what case, dramatic around are a we delay. is it expense. the six-month a data is XXXX not reported a there XXXX. some one then increase ASC, get that any brackets in this tougher in So, over on But OpEx we is the

point month. were what and our see XX% so we let where we have growing XXXX, left those plastic like at something we're other place cases when we this elective, me the on restate we're and see surgery working call October. market XX% were is is by a of of What March end oral the XX% maxillofacial year, exited we and So surgery. we and data were a that as last ASC urgent and But primarily where

in -- something be XX% the So in that XXs come right to that now, outpatient think range. the will whatever digits. XXXX be we is -- and in-patient range very be the if that spin low and plus; obviously about whatever in mid-single the forward, think right, something in XX% other will left, in will we the XX%, something And has from single inpatient

view but cell the I the broadcast Charlie David, so by know have around talked way, here, on don't and everybody quality, if passing just the if we're in I color, So knows, enough so room. phone it's that's same thing not

this is optimal. So not

David Amsellem

just that's you We hear very Yes. And color. helpful fine. Thanks.

David Stack

Thanks, David.

Operator

question with next Steinberg David from Your Jefferies. comes

David Steinberg

Thanks.

the near opportunities, first new solution, It's more already comment you talked that. costs the on terms because could slope the percent while, or were And seeing then granular some quickly KOLs trajectory of patients one specifically been long. what the a of and the you market more we've on I your the term pediatrics, of the on of piece. growth positive. for getting hand curious of in have patients opportunity perhaps some of in very of the captured. if just C-section, the lower non-opioid too They're even cesarean trajectory, out growth hospital was And for not

On an the it's other not targeted hand, ASC indications.

generic differential So bupivacaine. you're where you the Historically hospitals pushing of because hospital issues in versus some the facing of price had. back the have pharmacies still you

some approval. yet similarly could So, comment you not think with uses you Thanks. in the potential the comment is, the label. trajectory could the you and already you then that once on of part pediatrics. get first market, off the It's And of do also, approved trajectory on

David Stack

David. Thanks,

First on is our relates very more to to the mean I'll it say nascent now. as with address C-section, right, the and I that maybe the, end ability still C-section opportunity start small,

group maternal services in MEDNAX relationship that States. also MEDNAX the represent a XXX we train a position. good -- with are fetal Remember, we hospitals we have in United We fetal the in had over a where very maternal

is C-section quite So see we growing rapidly.

a of $XXX revenue. plus million still percentage our modest in Although

got a of groups that of expect To saw groups where equity me are is it a to your number and November. sounds -- know places David. early where couple what number we built will being centers We like open excimer laser fairly quickly. days of OB/GYN know centers. are in are we actually question the a going in private and We've birthing slope We continue insightful, the building these the

from We replacing ambulatory and care things the environment discharge which to no for when we've on stay pain opioids fact used we this COVID How away X.X exposure cases, that tackle is operational control, are and even for based number or move move to mom baby to night in baby. get a procedure to OB/GYN some through a that perspective. nights, X.X is to one standard days, the that mom are when as an had do from the is allows an of discharge There available for to pediatrician cetera. gone the specific we've days the can et of mom,

we're number working is tactical So of that on. things there a

appropriate quite think So the what do to facilities more here, you see I centers, to going as for relative see of today. velocity change quite be you're and non-hospital we extreme bursting open as

you is suggest doses anyway. there XX-year-old PEBs, old on a a going football when or adult or then XX player and get weight in into there and David, is body weight who that off-label, be So, years have would always they is you know weight some a that their to

are We And seeing ad do we is control EXPAREL catheters anesthesia and us. medicine and especially but have pediatric ad the mainstay as That post-surgical deliver low we're still modest. fruit and they the way is boards, are hanging pediatric the what control. for has of significantly pain in market, seen the adult way adopt pumps people of that it the been result pain for the they a really boards behind

on for for number And And Again, kids. with a where example, do the we're PITT back about of a patients experts, lot script, block in treat or we an so really in work, as on all we in where the them working important with approaches. cadaver doing programs. to facility is the ESP the have can we patients can regional world best having the and velocity the labs either going surgery practice and How we're of scoliosis and going Tampa talked and person care. to improving spine pediatric training and video

that the to going but market expect should I you off tease bit. we take for is a little define So

very in of with team we'll profile a with PEBs their enzyme that not that XX approximately pediatric do major and et academic centers their systems, is little different. thought-leading the with adults, will body We are patient, launch their understands cetera weight, nurses, important with everybody that

into to specific So market. need we that expertise launch

through launch of with next that nurses out team educational So after broaden go the immediately we'll we'll and programs with do as year. then that we

-- I have that's come So me another you if if David. question. right back But hope enough, to

Operator

Your next question comes from Balaji Barclays. Prasad with

Balaji Prasad

question. good the Charlie, morning Hi, from me. taking for questions of thanks Dave and and couple

expand should in percentage last Firstly, be of or in iovera, in on Thank to this your sports again in our the bit patients is terms how and as envisage can what you. maybe as of oncology the this how your to shift we you more EXPAREL could management the in pain complementing about imply? or regenerative speak for and you that this of focus business driver? what comment beyond strategy does you medicine procedures that growth of procedures, numbers do factor non-elective a context medicine, on the this one, non-elective how cardiothoracic And what segment a transition about and ortho either role further could Secondly, supporting component?

David Stack

Yes. Thank you.

pain you so et do, the It's resections, see to for obvious there standard a is you Anderson, as every lung they one is EXPAREL cancer major protocol place care. like procedures procedure So would a course, bulking for if that written non-elective virtually but resections, cetera. C-section, of that a procedures, a went OB/GYN, MD of

same the Cleveland So at the you Clinic. would see

Arizona Mayo, especially at facility. the same the see You'd in

that that on unlikely annual to is is ambulatory it Pretty there would the will So basis -- base a referenced. an you cardiovascular that of the that be growing the much same that environment. with move that some is stuff of business

a that's ambulatory be going machine routinely anything in used don't bypass see to You an being center.

hospital aspect knee forward. that's and we a growing an revenue by self-insured unions patient a we and patients rapidly very that things iovera a with try When environment that our number, is how we to before want One if second provide they they employers and lot as think that's of were arthroplasty total we will big could when procedures control and opportunity, is companies, on And to so -- than of keep we iovera basically piece the purchased as work functional have reimbursement to question a we your recovery. the a, keep, of why pay what to go working is they functional a that's that to in and so really in was structure talk -- the there XX% was stable to two physical of that's So well. ortho, as like more the of the, customers the and we've back important and business them remain the attention of really. there be use and on. so interested this what appropriate around here focused are pain the opportunity way and have get therapy a important is, prolonged left a do I And labor more in

can we -- is of out having get -- the living at the in using without then their opioids wheelchair, some we to in down that hospital. start PREPARE, start pain get surgery surgery is And surgical after EXPAREL are can functional plan a planned looking or through day a we're use better for become month so keep or aspects or would so can that We the any anything therapy, that before can so we what the So for patient. a to stairs, them patient pumps what their that the start iovera physical lives, storm, TKA the your going always the them start doing them need up and they surgery. in

two of just and the their by lot moving that blocks were laying the three or we in following issues femoral bed a patients so for with associated surgery. avoid days quickly, And nerve

to things able to do things can we're go so rapid very And go a and PT, you grocery patient do. car their being their becoming the like all transition that back store, to the at looking functional to patient own a church, the drive to

So that's piece it. sort one of of

months that no is it TKA or three what what have as a The they that if the pain pain. of significantly two for knee of we've COVID and wait other seen to to debilitating can months, tells is we've they have offer patients for freezing to surgeon going do that nerve. we do have is is, But by they're control a and crisis this several there room gone planned them for through the piece when as patient

a in about as iovera that last that several block to get what of the we're that nerve months and that think I'll to talking So nerve a lot block about can opportunity more for one OR and say has will non-pharmacologic extend do step the specific we patient until into for you smart interested hips, marketplace to perform how the again. do is tip, for very this you a be able for back incredibly hopefully do developing how procedure We're pain. it you a low new Docs spine. this are we'll shoulder, how with do ortho for

orthopedic So pain is important strategy to and go ortho, the to peripheral is a provide forward as really iovera we toolkit.

with it's few iovera nerve have to you're So that get block with device that takes of data several freezing an With both few doing docs that really to really And interesting a going our fully a scenarios nerve dynamic want are There's docs, medicine, and be then going working you're going where an get with the lot do for going years you're to the a we with, EXPAREL understand. so days, we iovera to both. a EXPAREL. months. regenerative lastly to to

or pain. control big materially. have pain, surgeon the market So patient we control when the the can the what surgeon demands patient's happens And then time of patient, the that is now in patient's and the of orthopedic change the they request

patient worried way more we to don't a car, now you that XX the you do that they if about if car, have and cuff, golf get appropriate of could they the because pain or about, couldn't in could out or and different a and did cartilage that rotator repair bone things repair, So talking now well, the meniscal have a out repair opportunities golf could ago. of didn't I in you ACL or wasn't playing and they repair start years do play can once in get my they exist all

it's same the And so, customers.

procedures done in surgery the ambulatory All of are those department. being

intend really opportunities those And ACL about we're meniscal repair, way of to operating, today. pain which the So own customers think all we're repair, it's control. cartilage the the that an on are ASC, calling currently it's repair, and we extension of

Balaji Prasad

you. Thank

David Stack

Thanks.

Operator

with Your next Securities. Greg Fraser comes from Truist question

Greg Fraser

Good Thanks taking the for folks. morning, questions.

David Stack

Greg. Hey,

Greg Fraser

or United considering I'm of regional year national policies payers and aware implement payers similar policies or more you're European what whether did part... curious commercial you're like if the seeing last then if on

David Stack

Greg. I'm sorry, ahead, go

Greg Fraser

Yes.

is enter. on question you that to the markets plan Second European

If the product you whether shifting in outpatient, like drive US parallels with could just the they speak EXPAREL. hospitals that of need for the to are in really our the procedures dynamics terms markets those and of to from

David Stack

Thank Yes. you.

is So on the Aetna now answer. states. example, in first for And question, absolutely, see, the we for several paying is HOPD

for see in paying less as XX ambulatory So are of XX, payers to in so and move department following environments national the as EXPAREL these addition they to and ASC. can we hospital the many CMS well paying the these patients seen that They for outpatient actually expensive now surgery. have

more that employees, also demand and have employers XX% opioid-sparing the those just X,XXX in a of working self-insured reference, of with all they we're in policies. to the their who companies the of payers United many And than frame an We have see self-insured are self-insured. States platform as

who who in cetera. at And machinery, thing your want so people and union, you you folks police are in the if heavy are opioids saying, a working et handling last on have backwards of heavy essentially United if have Auto if you bus you're doses drivers, is Workers, the facility

with folks working those that no opportunities. have to opioid low they or opioid demand we're So or

dedicated ambulatory anything resources have anything find their the patients self-insured by no expertise, of do now are orthopedic employers. we've up, don't concierge code, do Don't with but but to opioid work low popping the or are treating users, got many are with surgeons surgery work zip generally who tuned, that who opioid Greg. but that They center. got stay So services in

least total United with the joint So going self-insured where accelerating their That's for a the in already blocks have signing we to to all have Europe, well, of discussions zip code blocks. at In up field each are their spine label they're we nerve very, patients date, expect and very employers rapidly. defined going around folks these recent, are a send to big quite have patients and to who many States. and

trials interactions And of launched negative through we need see where all and infiltration the that the surgery audience the tribulations went and papers Europe. our go United of written, so the some we with and that unlike don't through States in to were

Europe. actually driven will started everybody largely in launch just this Europe. ERAS in to be so And protocols that anesthesia And remind an

the ERAS low international use So allows us opioid regional having the to with build in protocols or for interactions EXPAREL no society of these approaches. our

be -- that and that more you expect be and defined a ultrasound will just opportunity, I that neural we a experts there be yes, pathway. appropriate markets also and to. guidance so, a rapid in but the don't uptake is say pain more would Greg, using rapid much And more with want audience Europe in a the go will Europe, to

expect into for launch six this So five European reasons that or that you I'm know. sure will many launch of countries. the can we be pan-European But guys not will you major a

Greg Fraser

the color. for thanks Great,

David Stack

Greg. Thanks,

Operator

last line great Your with comes question BMO. of Nachman Gary from the

Gary Nachman

guys. Hi,

David Stack

interrupt we for want Deborah, can don't Gary, to one last Hey, this be question. I the second?

Okay, so...

Operator

Thank Okay. you.

David Stack

sorry. Gary, ahead, Go

Gary Nachman

no problem. Okay,

follow-ups. few a just So

the setting. ramp, on ASC a you is and First used that that offering on are increase discount in EXPAREL helped

a and The planning one. to runs procedure barrier force point hit then IP that more the one are versus over then the that couple from net IP is and anesthesiologist orthopedics, years? you expecting will dynamics. setting efforts is be anesthesiologists? when the changing additional the Thanks. inpatient future any file how will still the the in So the next out just growth the have next the how you evolving going how high of And generic And some Are does or could differ last setting. much at about that year revenue too the talk from per after there sales

David Stack

Gary. thanks Yes,

rebates any any So ASC, discounts we kind. in the do not of or offer

where the you I hospital it chains, have can't So a that is is that use a strategies. looks EXPAREL hospital, no opioid can't difference the cost. treatment as the an actually inpatient at is they treat us the look et at thoracic in in They cetera. ambulatory pharmacist that In environment epidurals it than guess haven't about et or who manage there environment were big low a with Gary. ambulatory ASP way, be center, our this actually to thought I They center able would folks reason the in And PCA modestly But use basic pumps. patients higher cetera.

in not the the we are bad guy So ASC.

are made We the person the possible. who actually ASC transition

a The So difference only environment a and environment the see right. and don't be plexus surprise, in or changing be much blocks not case would and ASC we a dose, this would lower when with forward, nerve is more nerve it's peripheral you're us block, XX-ml using that probably appropriate brachial for I go as this the any. with

a EXPAREL actually modestly So by modestly But definition is basis price case per is lower. and the ASP the WAC of on vial higher.

I'd outpatient dynamics, interested start both the some are opioids. infiltration to and the in and neuroanatomy an with saying extending the having all They're and And by adding They're use time to in rule. that then do in the by environment second surgeons, surgery case. case reducing the the spending general the surgeons inpatient a struggle not not of I question infiltrating. actually experts guess Gary, minutes of a in pain So interested the control, interested and few case at as the would around right. they are everybody out end anesthesia is in was everybody is The --

that so their couple they anesthesiologist where the block patient moves the board do actually case quality on can at improves few guidance it a It the end They the it it's under their et ever of So room here. great any hurry visits make need to before case. the add that to the higher who in actually done because before living surgeon infiltration LR, having doing quotient block in anesthesiologist, an is of is to this surgeon minutes a do The cetera. eliminates into the anesthesiologist this. expert to so provides doing they have this a the keep for a throughput. not go And and a end case nerve pain the ultrasound us the they control the minutes of have to the

last block. anesthesia now one. a the either an growth experiencing vast is driven procedure, a easy of from field a block so That's nerve majority question then And the your And that was we're around or generic.

you not with be a picket IP generic and of We fences be batch by a I've release some assay specifications. a of able we every EXPAREL. significant is us are There cetera. in to will based this ever on would release way going at and then that get filing anybody working drug to to that on the up firms et the no basis release my specifications in putting that the that the life IP bet made have additional batch used penny do they guess I we couple is those on terms

the our those you never this even to further they hundreds have make. cycle. to of and would be the to able decisions are specifications you has and that as would anybody against And have the FDA is duplicate. the proprietary deploy evidence what that through understand -- of of we been what we've exact go on has based told hard that release determined an be to have specifications. to are tell Nobody have is we There product how I assay manufacturing the So, made have

own over has to Europe again our been moving facility for years, our the Our on make and that's EXPAREL five moving EXPAREL to with in in been people. Swindon group struggling there own facility,

outside there say was told going this I'd that that anybody nonsense. figure a an out, me was if that's So group to

Gary Nachman

Okay, great. you. Thank

David Stack

Thanks, Gary.

Operator

question next Serge comes from Needham Belanger with Company. Your &

Serge Belanger

me morning. Thanks good for Hi, squeezing in.

trends recent sales around seasonality. monthly is and question First

seasonality past we historical by expect, I and softer I quarter see environment? continue to quarters. third seen in up the Did this of think external strong or quarter guess you the quarters growth strong followed in fourth in third any should sales historically has fourth that

David Stack

patients would were question, XX% Randall's given far be XXXX, haven't but in into the understand have given to yet gotten XX% not have a year. any the many to of in modest Should the see pandemic that in is or that not that's also say by the satisfied fully other rate, that over generally and and mean growth between equivalent it's really impact have marketplace. right. I fact QX that. enough at probably, we of the deductibles the unemployment and the as and same we the mean of by it, We're deductible But That's the third the quarter, quarter do so, on I not elective disappointed we in procedures time patients COVID all satisfying their I I driven going of the with question driven impact. there impact the you issues quarter, the is COVID, patients lay their fourth think the insurance, spikes insurance.

patient or patient and surgery. patient, far. Those trace, for insurance a paid much co-pay issues not who a house so having having think bigger contact available they're out that I than it's afraid their so can are to go of their

big and I the trying patients think to actually they're So, go a the and out basis is think state question answer one willing to by I on Serge, related it's if get psyche that we're the capacity to largely whether state and there. it's surgery,

Serge Belanger

this use Okay. there movement towards it And usage? access hospitals EXPAREL but ASCs and been and for EXPAREL any change big second with about a in question or Experal HOPDs, was has was movement

David Stack

hospitals, no? In the

Serge Belanger

Yes.

David Stack

not those governors change those so of by availability happened hospital Edex, at The virtue patients the procedures. elective then for of sequester, is, actually many pay the have the available is in for the COVID-XX beds have and electric But beds what's states procedures. for in hospital the No. been beds

a states in been we to keep center. to the in environment, grew vibrant by those ambulatory we relatively easy it's have so last XX%. ambulatory where mean, the move surgery procedures And mind, And year I

they're XX%. of we say are but ASCs any growing, that when also not not by growing that fastest fast, So the not does that mean are all, in hospitals way growing

Serge Belanger

it. you. Got Thank

David Stack

Thanks.

Operator

from Fadia Ami Leerink. with next question Your comes SVB

Ami Fadia

underlying to for you seems next continue happen do we will what that to that of on to available you the actually but to much for currently in firstly, your how being that we growth year-over-year have anticipate How the I volumes? growth? me and is institutions masked questions, It a do surgical of the year increase by is start needs the of thank that such that overall theme on Two for kind of volumes, in. to want dependent reduction kind just Great, squeezing growth surgical surgical visibility XXXX? vaccine change think flip volumes enough that

David Stack

the in the -- Well, the now the as growing And in surgery hindered it's by experience. year. hindered it's you in in the COVID elective to environment, elective last environment suggest, it's environment relative inpatient

lot side, capacity. you that think can I And have tell on so the a we more Ami, I positive

surgery the of CMS to a XXXX. ASC for total the environment inpatient lower resource, the ambulatory we paying January the and marks We patients an TKAs high we ambulatory in push we on -- example, difficult for paying started environment environment. move for payers arthroplasty going see X, from And procedure. continue to hip start CMS And to cost into to an to more more the surgeries move when move to ambulatory ASC. And and add the also saw continue versus knee surgery total major the spike centers to their a arthroplasty tremendous is

fast visibility that possible. how of when we have we're think heavily we to that's enough is moving using Do patients many going need and I are. to the environment is hospital favoring, seeing, have a sure on Do the right. what resources we you we I'm So we're vaccine? need out the same environment change? of this and guys need,

stays extent to COVID environment, greater do be appear before. patients ill the a how don't when surgeries a understanding and that have seriously to especially in of We don't a to elective ICU did require same they

pain these be expectation urgently many done, to our extend, more those we stockpile going right. elective So done been of that because the that need continue to procedures will is are to continue as are to not profiles

is into how that for going to out category longer can have And do move and of somebody to could ready those. figure going to we're who delay surgery surgery surgery wasn't delay the maybe or to

think you're you're continue going to to see to I -- going So growth. see

You're going just -- XX% said, so seeing growth over modest against we XX% October we see far. that the to continue that in to have we're

So is, go more surprise -- figuring willing Randall environment haven't Q&A COVID makes something referenced as the or need patients of clearly that that evolve, at is into comfortable. either out would is the more us when period, aspects important been or how not it's operate other to an as and a One medical in To get the patients all. something two when a this really we get treatment we beginning have the elective to to up mid-teens vaccine there's Because and the XX% and contact and available even surgery, we actually the community in even right. to a traced. being they here,

the of QX they're So be these majority procedures of of back Whether we done. think. 'XX, to market going us is but satisfied. to are it going 'XX vast all And, to backlog have going QX thing or of of for is one the to in all procedures know I sure, to be to clear this that of come very

to folks can to on And on reimbursement. so regional really continue work anesthesia, do to is we all train the with continue

to Other environment the to So with that, understand than as for move many our to make of easier living reps from can that a have people matter we can. our just it's contact not we as so perspective. have these when, we problems it and their constant they're ASC if, of and the folks world solve

Ami Fadia

maintaining margin very expansion as to margin the development. as the pipeline about well going just to that Thank we as business What's agreement question My R&D think should your was commitment expansion you, into see that the J&J up investments that regards helpful. away. with with second you

David Stack

mean that we the modest, books, in year. tell would there assets further we see of and the required we expect expansion that is have have, two that have. and that plan be or of And extraordinary. is assets. next right. margin we what there, have expansion five-year what the expect on investment see we four well, relative three prepared questions will V our you, very I think next in we go One through some over -- clear as that capital margin to I currently But those be to we order So, opportunities you're to the the elucidated that that, value most of the starting BD currently different is investment years. The we to I that's anything increase the It's very would modest,

Ami Fadia

Got it. Thank you.

Operator

remarks. like time, I would for call David back this At closing turn CEO Stack, and to Chairman to the over

David Stack

I'd forward to today's look listening keeping conference you We for progress. thank Thank you all to participating and on like you, Deborah, to call. our updated

us up and followed Conference Jefferies Good Conference the the in bye. Thank for Piper stay in December. is you November, well. Next London by all,

Operator

and Ladies gentlemen, conference call. this concludes today's

You may now disconnect.

Pacira BioSciences (PCRX) 29 Oct 202020 Q3 Earnings call transcript