PCRX - Earnings call transcript Q2 2021 | Pacira BioSciences, Inc.

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Operator

Good day, and thank you for standing by. Welcome to the Q2 2021 Pacira BioSciences, Inc. Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions] I would now like to hand the conference over to your speaker today, Susan Mesco, Head of Investor Relations. ahead. go Please

Susan Mesco

and call Dawn, everyone. to Welcome Thank discuss good our conference to second today's you, morning, quarter progress.

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

leadership Additional are for also team members session. Pacira question-and-answer here the of executive our

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

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

Dave Stack

Susan. Good everyone, you, you morning, for thank Thank and joining us.

on prepared the growing limit approach the highlights, progress and We first for few more key terrific of a today's remarks momentum us a questions. XXXX, are our in to take your in second half allowing quarter. time new will to made call We taking with

beyond, outlook discovery at quarter record in damages All I'll least Second for American coming towards of towards the million, continuing remainder to elective strong early sales challenges articles in markets. retraction million deliver will XX% the advance against These $XX.X percentages Pacira This the with and stages, is process our up mid-XXs dynamics single the published annual the this growth in X Society point be a X at momentum in expectations high for our moving quick the and resolution. adjusted in expenses. their ramped years gross of trends reinforcing both XXXX key line, next the should within start over and to within notably step operating with for despite case journal, modest Anesthesiology. our the next bottom seeking ongoing EBITDA a update of growth for surgery a Anesthesiology, quarter that the COVID-related to filed of market increases levels revenue margins $XXX.X on EXPAREL margins the to with lawsuit exceed and X years. improving allow operating teens,

timing the misleading. tell is to play confident out that This any in we laid level difficult I with predict this the how certainty, our out on will of website. was While maliciously you the are that on declarations our exactly and false is can clearly in are publications position

misleading drive fact seen these not go-forward demand. value allow with any continuing to we At cannot have faults proposition publications We and material EXPAREL's be strong basis. to referenced same time, impact as a the on

of Turning pediatrics. to the rollout EXPAREL in

several it's We are weeks the than going we even anticipated. into launch, and now better

to level As winning high we be approach you as a launch proven targeting we from know, thought formula deployed the has a This acceptance of to gated influencers. a seeing are prominent KOL thoughtful, leaders.

teens persistent use most are in minimize like-minded expanding Spine EXPAREL of the risk and which rapidly to and a of scoliosis surgery, example, highly opioid is For surgeons procedures. orthopedic opioids exposure of expensive, elevated one invasive is group given use. population's who to painful motivated children for tightknit is the

term for care, have specifically are the Medical national local our We who transfer the and providing leaders through education a pediatric pediatric level the prominent from as at of core best thought of of standard of delighted receptivity meetings. new presentations and been strategy. a enthusiasm with practice rapid EXPAREL-based is high in component establishing near protocols

from of top engagement Our thought leaders successfully securing children's the hospitals. is team

E. institutions generating are of around Texas Children's, range Scottish leading and panels, of broad Children's, EXPAREL influence technique fellowship using Hospital the across ask-the-expert the are systems. echelon and as partnering We at deploy campaigns. with procedures Reid like Shriners training, a These also of in and early their Rite awareness networks workshops such adopters education top data using to influencers the programs the key spheres country,

launch. within C-section. who the breast, C-section with meet don't EXPAREL, pain grow experience inserts better they hospital now continues are any positioning the broadening recovery pediatric able have while standard million has other shift to technologies, This and chain settings. our management and be now that women of package the patients EXPAREL-based DepoFoam who customer-facing the United want adoption will will better catheters-based their simultaneously X.X care and optimizing continue to the multimodal community launch care treated protocols pumps to gears a a minimize our initiatives States protocols across adult safety using indication space. opioids With are The hallmark of within seen vulnerable We OB/GYN provide in their safety ultimately an expect surgeons COVID surgeons demand the charge new of label for in and and and for toxicity to the many safety experience evolving pristine plastic of leading pain specifically population, and to further full anesthesiologists stay of needs the profile EXPAREL-based drug over for platform, to need health, our for to opioid-free validated reaction we the warnings overnight, team does expedite Shifting not are to the discharge and patients. for delivery this underscore to and pain after trigger management. by EXPAREL since of experience through our have in pediatric mothers The is the pediatric escalated ERAS the replacing and women's oncology to patient the all which protocols.

hands-on see returned additional meetings and to settings we bring this as gaining to education society in-person to opportunity ahead, life. training traction Looking

results EXPAREL design was block. upfront real-life single to support we our evaluate with Turning multimodal to to lower STRIDE practice. coverage preoperative study. therapy for in study differs the local line which analgesic a extremity the STRIDE from bridge from In we -- reported designed as top acting May, no EXPAREL,

not the a defining study the for our its view pathway While to a highly for we primary achieve adding results on to did the a hurdle as FDA label. high work XX-hour the indication valuable opportunity endpoint, with

are follow-on extremity design to preparing nerve lower be STRIDE the a is in quarter. us with The studies the can these as FDA study of the block strategy seamlessly discuss and and underway. meet third STRIDE We studies gives strong foundation. the executed believe our We

evaluating sciatic currently are planning patients block a nerve popliteal We surgery. bunion study undergoing in a

sites those STRIDE use technique. were successful appropriate and protocol only that will We and followed from

remain secure EXPAREL waiting lower indication on X can closely has will caused United the that price we to pricing with We we orthopedic these States. provide second studies long a volume, administration dose, guidance insert in aligns a to years. We initiating in Phase are specific we III use with Internationally, on canal nerve intend EU also launch package launch the backlog field bupivacaine for in and to technique. block study this of this as track the adductor of in in in the launch with a Europe of as only Europe XX-month the United is The to procedures iovera° does for in October far as a in lists along XX- focus plan, these half our block extremity mind roughly believe STRIDE Keep where this outcome impact year. achieving markets year. that tremendous X-year as materially delay outlook as States. not our COVID

market's throughput several Europe to optimal stay iovera°. after enable interest provide EXPAREL portfolio address dynamics the typical opportunity surgery In both backlog. in positioned post-COVID elective high rapid to will addition, and of The the recovery in surgical and for discharge These length and increased surgery is the EU accelerating times days. Pacira to be address recovery an

For initial arthroplasty. in adoption protocol our and focus anesthesia total regional EXPAREL, knee will be shoulder

begin painful the osteoarthritis procedures. as a especially and as work We For iovera°, role envision significant waiting surgeons total knee for playing the key well arthroplasty. long-term list anesthesiologists we as through pain iovera° targeting will in elective management, by

of approved. everyone, broad competitive efficacy give remind our approved and has label, relationships with Eurofarma. scale, superior support profile, already for considerable is extremity covers To along team field with blocks EXPAREL through where Importantly, clear both to a in lower our nerve a expanded America safety lower expansion. footprint administration a Latin us global is We fastest-growing and markets, in EXPAREL block iovera° Eurofarma The partnership the via Europe. EXPAREL and recently Europe expertise infiltration, one in blocks nerve our advantage extremity upper which international

initial Argentina, as a Our regulatory on taking Brazil, will will focus be Colombia Mexico. be EXPAREL and lead well. securing Eurofarma approval in

laying endures its drug-free next for We expanding novel continued ability commercial in first level out taking our and time programs committee cover steering underscore have and pain and begin and months. control surgery-free that an strategy detailed lines. iovera°, our technology of the growing hold growth cold customer interest to sales month deliver base to and and highlight To our meeting several this educational

Our proceeding readout according this year PREPARE study is early later for plan set to or XXXX. and

Our iovera° in and centers registry procedures will is capture real-world underway in TKA excellence. of leading evidence

out addition, same smart back smart the successfully spine our separate has will handheld low developing procedures we additional that pain Generation specific team iovera° procedures. with development and X roll and later will In platform year, this tips utilize a tips device for

spaces moving dexamethasone We also very team subarachnoid the first in both in development and year. Our spinal and half business for this therapy. depo administration chronic the program having in of of particulate-free for remain development to clinical pain inflammation cohort next musculoskeletal active is the our asset of front, invested a

dynamics the Looking and and and support we stand stage about bridging to build that ahead, both like transactions our pain. products. use of key we continue of auto closing, we focus with feel platforms, of We care on market that today early a BioPharma, are to spine knee innovation. to acquisition GeneQuine chronic two we pipeline continuums the where Spine great for these and strategic franchises licensing and to seeing plan end In promising investments advance combination

our on continue highly remain will growth confident growing outlook. We momentum to in and build our

the goal solutions patients Looking regenerative are the to need. bring of by use ahead, investing fully and that to and technologies our non-opioid intend in with innovative lead novel and way pain iovera° EXPAREL expanding synergistic in by we health to management

improve cover With topics. our over I'll the employees dedicated the key of turn $XXX excited Pacira the that, to about expertise With short-term call to and million few the team, over we care. patient management Charlie cash, are experience future a to long-term in for and and

Charlie Reinhart

everyone. morning, good and Dave, you, Thank

with peak June. of May. daily the EXPAREL growth second deliver prior following results returned continues COVID year-over-year of remind top we quarter in lines. with in financial average To and outstanding to utilization and of XXX% coming for XXX% the at you, month for levels front, at the year in continue in and growth for impact fuel second quarter June to coming record this the EXPAREL On sales the XXXX, bottom the to April

planning year-over-year regard gross EXPAREL over manufacturing capacity points margins XX% at that continue at to rate achieved and robust gross the horizon. through With As we of in few growth EXPAREL we steadily is our of cost month growth growth achieved next the will look margin consistent ahead, a to project with our least improvement is with June gross trends, This the high to in over teens growth rates volumes. indicator lower the be the XX%. X,XXX strong basis years, we X-year reaching believe of expectation back least of margins, combination expanding pre-COVID

yesterday, manufacturing, XXX-liter approval our FDA's ahead milestone commercial U.K. were a facility. of announce key the we in unit manufacturing batch with located to schedule For our of excited

this XXX-liter another XXXX inventory. later to unit expect deliver in in selling will begin margins product This selling we manufactured start We significant year. this uptick when commercial gross by

of exceed batch We XX-liter XXX-liter the expect current batch is XXX-liter our units. the process Projected are supplying responsible XX% primarily costs unit margins lower to EXPAREL. those suite than from once for

facility most As a those we per-unit U.K. San costs comprised the at proportion Consequently, volume have our higher manufacturing will the facility, our mentioned suites out the have of as total increase. remaining bit sourcing proportion take higher variable a Diego way the produced in EXPAREL fixed fixed are from costs, per cost. of volume that demand from Diego from a of San our because of manufacturing facility for past, facility unit while require will in we X economical cost the balancing units of

EXPAREL for take Orange will With FDA's patent position to approval This claims composition XXXX. new listing. and of of process XXX-liter prepared our the process, patent by product by Multivesicular proprietary have Liposomes improved process the we of our January Book Bupivacaine Manufacturing submitted our

strategy, years. $XXX adding rigorous deliverable than underscoring the making Over years, method more patent patent first comprehensive invested are accumulated only we we the a Pacira a EXPAREL X exclusivity world. last The we is efficient in highly commercial globally. more multivesicular than safeguarding another and EXPAREL committed deep and market liposome from the at core a is our are have processes matter multivesicular standards XX proprietary have meets safety liposome ever bioequivalents. Remember, and that specific a that in million over to that the competency layer in for manufacturing new This the that for to has Pacira scale FDA's more manufactured expertise the of company anywhere manufacturing

for a profile safety multiyear any to facility the for leader range and operational also design we a based that and rigorous any pharmacokinetic hurdles procedures would never our would we'll manufacturing includes to years and batch market the chance confidence of to would require many This established duplicating believe Regarding process come guidance which study commercial and since field inserts release by this on is potential a adults pediatrics. across block the on extensive scale effort accomplished remain be have package and This And great bioequivalent block requirements competitors, short, little broad or for never with Pacira generic infiltration, near seen decade-long disclosed extremely EXPAREL nerve have specifications we we both the bioequivalence, EXPAREL. the prior assay. given have FDA for branded In generic that will validation state, of have to EXPAREL construct we long require consider. to the EXPAREL, proprietary infringing potential a licensure FDA. be patent now patent proving without another strong and

uncertainty product share for intra-quarter we providing monthly of continued currently COVID-XX recovery XXXX with and we around the sales not market, trends While given the will continue guidance, surgery pace report are you. elective to preliminary to

lead are the providing tissue the market time visibility remain COVID rates consider will back long-term in this is infection We COVID. delayed variance The to with of we us returning that that of growth, lack EXPAREL on I'll the to warranted. gross our operating have soft by revenues will We Q&A the which increasing operator session. this the for X,XXX clarity robust this the not $XXX changing COVID planning of bottom-line surgeries practice that half and track and and million $X post plan, year, at to as points our for to in for improvement in basis period. margins With X-year that, confident exceed is our margin and top by XX% and more conclusion we approach of bullish guidance expectation ask end begin Operator? iovera°, deliver our around billion

Operator

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

comes next Markets. Daniel of Our Capital from with question Busby the line RBC

Daniel Busby

I've got couple. a

about during expectations X that terms roughly million the that elective of number warehouse can half in you've to in for the XXXX, potentially about of you your of talk those back update? second second your changed quarter respect the with you procedures of half First, year. half pushed have were this coming saw during second what back? of And out think the talked procedures year past, procedures of I last the the since the came

situation most is regions with clearly still are particularly seen country but on procedure the volumes of have variant evolving, or impact thus Second, far affected? those that you EXPAREL overall any in use, the Delta

Dave Stack

Thanks, Daniel.

who that given had procedures to in we patients were call, TAM important, we really of XXXX, no of of as the patients Q employer-provided expired come who number we X XXXX number the insurance. for First XXXX. longer back into number thought the patients thought procedures our X We've million, -- would the who in we in -- not were of there million revised mean, I last that all, performed went

some that so experience. the happened largely we're COVID And of have dropped -- environment was result as because a the number and of the that things of

So we the second in Daniel, far, quarter. as little we've what through quarter, difference, is, seen went very the

'Look, a a some together,' in July, to marketplace. whether understand we did in that family some backlog folks got little was frankly, with vacations. really all As have we get know we spend the weeks of of but last don't protracted got to away and see huge of time saying, that. vacations softness we to needs just And bit and I've marketplace couple We, fairly my seen the related the certainly

to whether July we've course, of on or already we anything months. So couple expect you that's I of would don't whether circumstances. related a for know, that phenomenon Delta -- forecasting first frankly, have the what just basis. the you seen July can that's under we tell mean would July was any And disclosed, that I

broad answer nothing the is guess material. I So

certain in the hospitals of again. we've you some for ASC But no areas, so impact now for beds that business. seen mentioned, responsible watching XX% our which over COVID sequestering specific HOPD, or the are We are are as far, on

the that in impact muted will think be we So any case.

Daniel Busby

I allocation. If it. could Got on capital ask one follow-up

a investments I'd your the, having in via that development. thinking you at But and enviable repurchases in is point a start And dividend? You're that the large priority of business say, targets of suitable absence position is share to $XXX growing. there realize million returning perhaps I shareholders, cash which special targets, about and almost cash whether or of some of specifically

Dave Stack

Daniel. initiated We've with discussion the Yes. that Board,

in absence orthopedic have with preference that We of we're additional the allocation to we not a that But But on to our pursuing. actively are cetera. from talking funds of clearly, yet, any we that to and assets our back et value to the made yet. capital spine, that in of shareholders. there in number have we're relationships assets, business create find a ability would those anesthesiologists the return kinds development things decisions would by guys benefit haven't be and bringing we In

income grow the that to that going outlined, and So rapidly -- net Charlie but quite grows. our over is top line expect we time, as

even position the may short years be But there be think that looking BD down large So term. that even point a several we're aggressive some road. don't with will with and that in the in at targets I

Charlie Reinhart

we’ll we comes forget April in near have the don’t of year, term – the million that next convert on Daniel, due. X $XXX of first

also So time that’s horizon. our in

Operator

And with line David from Piper of Sandler. question next Amsellem comes your the

David Amsellem

for before. issue apologies My the tech

a couple questions. just of So

you really gross to guidance, other ideally, But regarding capital with I margins. a acquiring margin So and EBITDA And first, online. number and thinking EBITDA target realize say, assets just a the margins, I about So missed leverage, share, about more your how priority. also is Swindon particularly direction that latest on one. about, I you'd not but on get Swindon ankle but long-term like long-term this Also isn't on wanted question the if now particularly online? you this. Number operating allocation two is XXXX do think a study and STRIDE, that's foot with have to that apologize

another more So that Just you've regarding speak, into o to indeed over endpoint, us the to in the hump, help that you you be steps next what on to the sort if do so detail forward? is thinking endpoint talked going think study. get that going program. past of to to go on still on need about just XX-hour understand your Can you

Dave Stack

don’t think by very we’re to But we long-term David, let And net on Sure. we not this strong guidance, I’ll in to position. me a saying that try actually. give do call and income start intend

from comments with has start he to of a in Charlie and all But of over think out if give we’ve to XX% a here the where, I’ll expense gross margin, we a gross that margins of calculating We traditional is have of improved position items. second. revenue any something to and ask the just frankly, we’re generation the percentage in additional way disconnected sales,

iovera°. associated R&D against a So the short-term in of pipeline million that short-term additional with in think budget the issue. know some stays as to the is legal we expense $XX $XX that there’s and action that’s well Society, the everything EXPAREL we in our million there with area but currently Anesthesia BD as SG&A,

We an of will additional reps add basis. nominal a only annual number on

X% the on X% And of thinking something in so increases annual range basis. to we’re an

the bottom world. believe in take you you to efforts, be we’re that what depending over be get BD X-year successful net million income, margin to of on be for – both that numbers as we what we in the anything, that calculate $XXX is will in some That said script, buy find we if But if some for planning the the we will range out the If planning BD clearly gross – EXPAREL you we access XX% these line, allocated billion capital for upside, when it in products. higher a we So modify $X now the could will don’t iovera°, will XX% to than over and period. some the But our we have there. think that.

that first used new XX ankle and therapy XX trial, be the the for the that. endpoint XX David. was still we to trial, will first that to we use XX that traditional where keep On additional your EXPAREL a distribution false to of to was actually extend steady, of FDA, X You margin us is. will will a because There’s therapy multimodal XX, here. trials, of or SG&A, be – will was about to and some Daniel’s foot own that was increase where nominally no set is cash. that shareholders addition bridge to back relatively going the R&D to a net will lot type we be you out in we to question In your would additional STRIDE, and relative One it will we the accommodate an you by up come there we will the question or leads bit about a G&A special second conclusion that that And generating scenario primary hours, believe, hours. something

have marketplace insert, protocols there, trial want canal we We the is a specific we instructions of trial similar a much with And to into also dosing. also strategy. this field adductor around But ERAS the form an put package very a the multimodal knee largely around expect some activity. because duration are doing to for block specific

do we’ll same thing. so And the

bit is didn’t trial, we which block nerve first a non-inferiority we had EXPAREL XXX market XX in would first takes And meant in the us patients here XX a have XX or that the for over knew little trial. for States was really trial, FDA to confused us hours for do extremity what at United And this think the then either why for need the we those only gave I in design opportunity that alone lower full a hours. now to do that EXPAREL they those XX to XX. is and study do out multimodal we know first the hours, and then strength anything

Operator

with question comes Neyor from JPMorgan. Your Christopher line the next of

Christopher Neyor

questions. Thanks for the

First one block. nerve is on [indiscernible]

live So you've physicians on and feedback the on the and what XX from following kind hurdles on heard And so question, reduction. STRIDE that point? study the this XX this earlier getting underpinning months up view? interested And I'm what of across to KOLs line, key to specifically go pain of you deferral in are in the referenced time XX what's for at indication hours XX

Dave Stack

matter, getting the done. a trial It's just of just Christopher,

can meet needed in will some we'll and hours with the now surgery, additional there those additional the protocols. XX We post clearly the with go back see therapy FDA. They is that

other us. and these sites programs, stats changes form, up are available report CRM They in have time-consuming STRIDE. cetera, We remain to are in running. case things to all that and were et that the modest successful the getting into very to very Those sites the

protocol from of trial only this and short get -- running up have be to this it's a is not successful us the expect through here. we abide that the And were to time problem having most going is with keeps patients So other thing that protocol which period in very -- -- thing and make with not the have study. by the site to STRIDE the STRIDE a the violations, recent

trial think would sites, given same the responsible interim normal frankly, months trial the -- the of significant sites the all this to did in aggressive where primary -- were not for under but be we analysis. that sites circumstances. same statistically X.XX we scenario, XX the same the think So correctly, the primary XX and beginning we've the endpoint well, got the But at

would us that broad know do foot the lower X for block got confidence a for covered, then knee, we separate for it us basically minor give And do broad be have but we will the then the don't basically, We trials frankly, FDA covers protocol. brachial the a that and that separate lower to we how to ankle use adjustment knee label, the adductor the out canal of block It so will whether and all extremity the nerve lower a It's majority upper So very sciatic will great for the extremity. this. label the like will give and know, if vast and quadrant, plexus procedures to have we we've But and all extremity. it be not right? much the procedures. adductor the

no harm, foul. no So

Christopher Neyor

on second That's helpful. a then And iovera°. question

drivers opportunity you are just -- about market next how this of months. on How curves building specifically of the the So uptake the XX think kind And term? near key and out the to relative over knee XX osteoarthritis? do what between kind of size

Dave Stack

to the us, in anesthesia upfront, to around surprising community be for It’s is great candid Yes. interest there OA using that pain. iovera°

So to what we purchased from related really all knee. MyoScience primarily were

get So or using and iovera° cetera. at look procedure several patient to up down et weeks the before the out PREPARE trial, the stairs, of if the going you it’s wheelchair

itself. the PREPARE want pain by So of measuring the go And a that driven we lot better then to is do how are procedure the And being impact. of back OR, storm self-insured as trial TKA outcomes, prognosis they the does work. functional frankly, this better patient for to a long-term these how patient Christopher, EXPAREL use does bring know PT, do to they have employers, questions, who in

the affect how what do this try get were and does they And patient we’ll with and they same ball, the can us? that’s using imaging. single of as Are is the landmarks ice the And X in largely each injections, of X number questions done a are it’s come There’s long use folks that under under ultrasound. number just are done probes, sports a where end dollar. forms those not at money ball the and generally larger and the for injections, typically a or with a ball that Are Trident on you they Those So single we at they folks X looking we’re the they’re administrations, the needle, forming XXX medicine ice ice actually answer not before, and The and spending of of than requires anesthesiologists to back those are because needle before? our they’re a the typically so different all needle, PREPARE. – probes. rate and better using ways were of imaging. or using many cases, ortho which that iovera°. anatomical different The in

our knee surgery they total family surgery that force a ASA at it’s can’t want because from want the to the a daughter’s right to to ASA have mobility. special are field COVID arthroplasty or as get procedure. primary is during get won’t And who for So now for selling of went lot patients and of their osteoarthritis X. vacation X have wedding, situations, dance people more – We’ve with going their on also that they people knee

club tennis, because Just country people their that or golf playing knees have hurt. belonged a to aren’t

into things of coming of All those are play. kinds

pain, media of the guidance go-forward several a have So have that got XX just those procedures. great Americans. mentioned we or an treatment generally, effective XXX-liter will that is million On will months be – we’ve reflective million pain, branch largely separate tip basis, low block – confidence the a back from I $XXX

with spine in frankly, specific We’re number that very interest, actually actually pedicle been anesthesiologists surgeons driven also administer with on a of and how activity lot these a we great working who working and have have There spine at now procedures, the the how spine of people the spasticity. and products. looking we protocols is prototypes and these address are

anesthesia. We from think a of trimester, was Looking on at under can administered basis they’re Botox, spasticity is or a cold. with X times the on in using kids, Currently, we that general physicians. improve year X a specifically which some times Shriner

procedures. rib cardiothoracic at fracture looking We’re and

OA of and So and outside there’s number and OA and foot of risk. opportunities the OA ankle, shoulder, knee, the a

big those specific believe and could that we the to we really us be situations. breaks of all can a if if we these catch very be engineer couple to tips very address So this way things product of with specific lead a these

Operator

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

David Steinberg

questions. couple have I of a

is approval be you And year us to finished Do there the with you you could The -- next that improvement this cadence. help a be approved going us the with could this the year Swindon obviously moving this of launch margins? percentage million and gross most we about sense and X backlog talked the next year? Dave. wondering X year, one Charlie, was some cadence Or year going you your you've to facility, I is for facility could of that on speaking after year? million to And the give perhaps margin this later into I think see them of improvement cadence know going manufacturing do some about is then forward. of procedures, now high you're and the how the if should of backlog. first think with of

Dave Stack

Thanks, David.

the one to take I'll -- me Let and over Charlie. it turn first

a seeing the the what's in David, in marketplace the of if of catch-up So orthopedic is -- terms happening marketplace in procedures. what we now, is lot we're

that, motivated if you'd that we you very for is painful, to they're the not mostly ASCs knees, very profitable. highly reason So now, of schedule And but so spine. most patient go see an hips, they're a population, of is course, OR the have only

expensive procedures. they're so And

surgery And ambulatory insurance the towards so companies cases and very centers HOPDs. moving aggressively the are the these

both CMS, of combination and very and patients insurance carriers, motivated are highly self-insured that patients well. those as does well the as commercial, where center frankly, ambulatory so surgery And moving EXPAREL towards

relationship driven with patient, something or that who by surgeon really a a the orthopedic seen that's spine so largely, far. decade-long a way, or fact hernia or been needs which a really hemorrhoid has patient different care is of by strength primary a we've what the So quite a an than That's like the surgeon that.

seeing of referred. David, to Many procedures, then to itself and primary we're patients their back that care so marketplace those a primarily with surgery to are because don't local in being those consolidate doc up ending department again going where the -- many take hospital in they procedures low-profit the and and have elective the position are hospital just yet. ASCs margin environments And

surgeries, the we lot market, into surgery the what will we catch we out their come procedures, to that with they see more surgery going elective strategies with procedures first of place. think lower-margin hospitals start of as tried hospital in the but that orthopedic a they're be back that to So up to believe that to the we'll soft of stuck ambulatory ambulatory procedures these tissue get these when the move happen through

interesting an year. watch rest as all catch X million this the clearly going this We're up we of quite get year, be phenomena David. to will that not So through to

we X.X range, think good in I pretty million a we'll if X.X get million, spot. be into the

that about the want or have to or that there's it's procedures The before X filled, had think over a into had to facility that procedures to or whatever, joints those an get cut hemorrhoidectomy in talk is X years approaching but insurance the carry jump going you've we it's We it's these like surgery? like million that a be whether part you the something think of are margin? we or you so answer you Charlie, gross hernia all And the plus have to patients to yes, question availability going those early XXXX. spine. clear if that as for that and not if time still something of is the opportunity

Charlie Reinhart

happy be I'd Sure. to.

becoming available, that. this first unit with at XXX-liter David, to we'll the commercially point, use So start

both units we San You know batch in that Diego. process the XX-liter and U.K. have

we're utilize continue So the in plan, have in grow, start Hopefully, we'll our future, we'll to to of as fully pipeline backup. kind X-year the more products. DepoFoam-related use volumes as the for XX the projecting We'll XXX-liter.

both of Diego, XXs, smaller San So and XXs end comes in sizes for batch to probably manufacture early we the XXX-liter San which a rest also Diego developing product used pipeline some kind might for the 'XX. be of online second of of world, 'XX, hope you've unit We're seen.

X-year that our towards years this quite be is the end product, which those will we all by XXX-liter EXPAREL's And great. X planning our X percentage improve as U.S. for would possible of really a drive year it's gross of point, each goals. couple points product horizon, at that or So is best estimate margins the next the

David Steinberg

knocked Just I previous assume drug a question, asked, competitor. I have why since just were on you've many due And have that But you're curious, label given formulary P&T be theirs? on new much product? the already some happened would it's Heron formularies, approved. been off been have these call. discussions instances been apologize. of a now if vis-a-vis Heron if so, the your any has you is broader than And follow-up We your found where that the I to

Dave Stack

Not one, David.

So any – have of I response part second don’t to question. one. – have don’t I the have no We have I the don’t

Operator

Your comes Berenberg with line the Capital. of from next Dushyanth Anita question

Anita Dushyanth

adopters? could used expand where and sort of as are the far as lines European procedures that are early Could to? to EXPAREL procedures being which And EXPAREL what the I the you the sort kind like are a as launch, in pediatric then follow-up. And some the use procedures of market likely it possibly that is now along same of talk of about other the have

Dave Stack

the been going him Roy Winston to U.K. we're ask here and It's procedures in backlog. try In expedite largely I'm going European knees huge one -- payer, the focusing backlog second. the the the national where the cover much health this I'm there that they've -- ask procedure around the the Thanks, of on is payer Cleland to pediatric shoulders. greatest market, got different has so unique got. Roy that government is opportunity And to Anita. market, to to surgeons we've groups of with the a to where system, addressing working country in closer

surgeons sharing or these these So hours cases using center same-day folks how these folks a do X folks, out we're many an are ERAS after our protocols how patients X we doing our working having with -- walk showing our knee. about with total anesthesiologists surgery surgeries, our talk them, to ambulatory and to of -- in talk

to So us EXPAREL. those and it procedures the both makes most with iovera° to sense for go

So given a U.K. that in we'll of move our way pain backwards arthroplasty. Europe, soft wait XX-month we'll the and and procedures, tissue as spine the really the it's of in those, focus hips out profile knee and a we work into because right need for then forward to move the on because desperate now, total then largely

the needed take So on us an years cleanup we will think front this. got opportunity and that we've of several end a

that's -- sharing we educating prep well the that for when which where would peds And so now they're and et And procedures where we're about and protocols, specifics we're focus a you cetera. to headed? these leading launch. the are going give into need with could you guys some Roy, way

Roy Winston

a lot it's that mention stuck did need. that's of a pediatric area one, number to Dave where tight-controlled because an the very scoliosis And two, to. And of at launch. our Happy Dave. we number great was; did idiopathic We beginning in. Sure, data

have back ages They're that the pain. a lot of these and usually of of and and tremendous XX kids opioids massive they these surgeries. have amount You XX, between have a use

very a been uptake the So a rapid we -- we rapidly key bit launched expansion. found where adopting. really leaders quite of and from opinion were the there, has there And to there

For they mind plug use to a to kids that or instead pediatric to in a it's of of in advantage And instance, the into block to extremity, Shriners some you with got hospitals they're catheters XX% used able them give lower But EXPAREL PCA now. of drug just begin finding off-label with. like such device. using an be is that to keep

it's reconstructive big also these large procedures in kids are a rapid currently very or catheters. large abdominal And But served finding are finding, all the thoracic orthopedic the the but small, that we're thing uptake being spine either where among So these are group. tight-knit Really are And opioids and we even there pediatric IV procedures. not by a procedures. areas procedures. only among painful anesthesiologists, large surgeons,

things beginning pediatrics, one are country the people because that looking major doing to pediatric And and feel very institutions possible pediatric quick think improvement all that's the I is provide what's the in of I like EXPAREL, continue, anesthesiologists across to we the use. that's best it's I uptake. have patients And We just and of for where those at think about. expect studies really surgeons the motivation lot to that to led the quality now trend a care think

Dave Stack

Yes.

out is example, And called using Anita, Roy are places experimenting specifically, GI, a in. right, orthopedic foot, lot with GU. economies, club one a to, so burns, of significant was procedures appendicitis for product center as number one the of is very referring Store that that

now and could they that And EXPAREL they're PCA keep pump and they in largely hospital. catheter if they all the were well. have very is hospital adults. they're lot So that at a kids evolution what the lot what pain the the really -- getting there's we out the control to certain a But with saw of so given or now, interest as there's significant of -- a where staying places in there's in of opioids of in of of the weren't looking using a and experience overnight, in these interest we number with

Anita Dushyanth

helpful. sort color very the was related the too starts in are steady Europe, increase of think expenses. like should expenses lower the just much wanted in the know half? providing on that. on with then about one give just in procedures I and the of But know to guidance not we kind you you then And question That launch additional how I in can exit the some to second

Dave Stack

Yes.

we’ve portfolio, current good told is count specifically, about million, $XX number. BD, we So think that they what R&D in a the that the can with on know that million we for folks plus $XX

contract hiring side, the sales a we organization. sales On are

is action similar is ‘XX that, frankly, that half XXXX, numbers in we’re much like the of are. the Society. And increase dramatically to more of not back against But Anita, increase of material very as so additional anything the G&A the wanted of Anesthesia legal everything us those outlier strikingly marketplaces. back of the spend an some really resources. line what a anything result would that The the of in we Outside the rest will looks the some for in terms you doing was to the back American half budgets have the if now specific of only half cause ‘XX. in Actually, ‘XX –

Operator

question next your comes Securities. line from And of Andreas Wedbush the with Argyrides

Andreas Argyrides

is Argyrides Liana Moussatos. This here. for Two on questions quick Andreas

to million First, then much product of regarding comes potential be And to X follow-up $XXX as iovera°, outside you've previously the years. a U.S.? How in question it opportunity guided that the of a just from pediatric now.

And must guys a just uptake, million? $XXX rapid have you is? the what I guided you there's If there is the can remind believe such if like outlook exceed it -- us potentially to to

Dave Stack

Yes.

for in roll me million question So outside looking $XX of to missed writing I'm and something we range beginning million in I neighborhood if you first the the $XX together, into have numbers planning down the Europe. the Andreas, we are the iovera°, United second was States, in get was? I'm a I what October sorry. you And question for in tell we're you launching and signed can those license agreement the the, sorry, Canada period.

Andreas Argyrides

Yes.

opportunity. the pediatric on Just

million. $XXX like yes, guided, previously You

comment could on you if Just that.

Dave Stack

a question, good That’s thanks. actually. No, Yes. really

cetera. not So a for of we GU, we orthopedics, TAM adults. – we’re pediatric I What that And we’re burns. we there’s And still guided tissue finding procedures extending TAM. et lot like pretty shape. desire broader to were in think our use the against product things the many in adult procedures, extending in in so of much But using good GI, the were soft a basically is

think especially the we’re the low at from adoption given say pace the least, expectations my to that X-year the going of side end today, $XXX planning period. So be of it’s million, on where safe to over up I would

with specifically. We up anything haven’t come

What that. to We we’ve haven’t line the guided to anything higher time is $XXX than million. looked at

in confidence the we probably conservative and given now. million that’s And number, increased so everything know I would $XXX say,

Operator

with Truist the Your next question of Greg from Fraser comes Securities. line

Greg Fraser

did if on apologize this. already I got July? in so I covered comment EXPAREL late, you sales on you But

Dave Stack

say July. looked like did No, not. not, We we did other than it to

those nothing surprising. and be that that would And Greg, talked about the teens kinds guidance so given numbers, we've high to of

Charlie Reinhart

Charlie. Greg, this is

the months in over at COVID. of of because looking crossed and the June -- 'XX for any it now had didn't because 'XX the kind I this think relationship And QX, between I'm bounced just at was June COVID. way we is couple us from of point, 'XX make sense back

in And looking comparisons. we're at so now starting June, now year-over-year

next but -- Dave it another compare July the was to numbers good So was saying but favorably what we'll that it last actual I release week. think is July, is will month,

Greg Fraser

it. Got

the Two those where would are key and curve block TAP drivers curious brachial growth say in would the how for you EXPAREL nerve it's you is days I for I'm you for growth? in blocks, indications. guess early describe indication penetration still plexus Okay.

Dave Stack

so not was I really experience brachial clearly point much EXPAREL. some it it Greg, just with regional was for plexus, to anesthesiologists – is plexus Brachial have the

say, the inning not or be use docs So they ever would for would or bit to brachial that that have or a surgery, success procedures they were say, has shoulder of tunnel a EXPAREL and leading an have or before, they place So block use their protocol would an and But but be fourth infiltration carpal elbow brachial where do, rotator procedure. a there number that in cuff plexus past procedures is plexus in with about would a appropriate way. the the fifth to going thought think I shortsighted, using a because just EXPAREL a really, of that led that risk wanted would right? indication. surgery I EXPAREL other

nerve quadrant use that they’ve guys on procedure. the expanding – anesthesia whole the block, the effectiveness with that across you in see regional a seen based Now EXPAREL brachial plexus of that

Xth so we’re, change doing rescue in to inning, makes called and to quadrant, the much up hoping talking regional we’re sense. the TAP for they how and Xnd before I it’s the I TAP fifth you’re more do think upper going story that brachial patient way to say, something talking is address probably bottom was think patients to plexus And shoulder TAP. they control would get EXPAREL then wake the TAP the surgery, a anesthesia first was pain. same of cuff like that folks if It’s in night. to pain about, that through were waited pretty postsurgical the the in if So rotator is specifically used the which about

we increasing the the and these see try Now and surgery the leading TAP blocks. anesthesia confidence regional to the of community way

And it still is a ESP to spinae with C-section, or patients of block, But is were we TAP result us physicians the what talking a cetera. the so different really relates erector success of procedures to And block, as procedures. which using number we’ve just like it in seen now scoliosis that blocks TAP in as et useful important the are is the about.

think ESP, is it’s by you’re talking again, probably, TAP about I game way. if So regional about the long-acting X-inning use number the blocks, PENG top rapid And if I’m ways community This talking of that non-opioid, inning. blocks the referencing, pecs block fourth the it’s a you’re anesthesia more expansion specifically, to anesthesia like a learning and different is Xrd. and of probably of how the

Operator

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

Serge Belanger

X I questions. had

they'll made related The to X be on ZYNRELEF. it a targeting that first segment. prior is the clear a question pretty The follow-up competitors TK

if seen second deck. just slide anything maybe only of given you're maybe Just And month, the related the then if your curious if impact one you've far? launched is early transitory. in to so It question they even expecting any graphs but too

to the on the surgeries. #X. outperformance, slide that sales outperform really volumes. compares it's in one think, June. a The that I really think elective surgery elective I external in volumes EXPAREL basis data weekly increased We've seen And

an that the how we data or in. it's coming really should indication to Just the in just related about growing ASC curious how are it's of role think if claims EXPAREL's

Dave Stack

Yes.

an me the I take Let think second you Serge, raised because one important first, point.

compilation is it a So data. of claims

comparing right? So So for X weeks is time. over we've data weeks real as that now we're for even a normalized XX-plus never have procedure, and to claims great delta EXPAREL will going than example, normalize market. claims data higher the right? the for compilation What in come time, that we as of a in as from real last in. ago, those is that change delta data, EXPAREL the X does is points be it to week seen elective surgery So of

opioid use whatever. amounts than seeing, surgeries is what and against need extent line, see. plus/minus insisting So to going with think move by that now. normalized to else, to a are care that And to it we of -- especially would to no is worry are pump still surgery these the the don't we've EXPAREL ambulatory a that. very available outpatient materially control fall elective numbers, when the They the those surgery for much better the see in as from what on that physicians surgery dislodge as doing docs market I And But seen whether don't lower, that driven the think small hospital companies and available environment. they same-day pre-COVID or driven we the expect and catheter I or about is can see some that's catheter. to out sites do to hospital lack in is that of be not some to to starting the Again, of just have they these they're in anything market, surgery tools that's insurance departments pain move that in peds

I think I increasing single that administration. think marketplace, we're the we real see p-value confidence of value with that the from more base days but has of In these XX as you our use is a And light, to so seeing of endpoint, having there in well. several and a for confidence hours a some missed in primary the STRIDE study. Yes, EXPAREL doctors

points on XX-plus the for still basis surgery So a normalize I in will EXPAREL better claims and elective than think curves market normalized data be the general. the will

is knees. And the can't sticky. product that. the to it regarding product weren't is and laparoscope. very The a It's rapidly Heron only docs we've the It color put that question difficult for you changes use. and feedback ready Your very had through

the pain yes, in package heard anything through the I We neighborhood package X guess, is I what say. score insert, In the the hours. -- of haven't XX stays in insert, good, that's would

can show to pain So we've the heard different that the like the that score than marketplace, never that in of was insert, FDA-approved package the the pain which gets the with suggests EXPAREL. verbiage PILLAR we physicians some score in the trial anything achieved

have over I on impact Any it good? You EXPAREL any is very trial modest time. there -- I follow-ups, Serge? to don't expect So use.

Serge Belanger

I’m No, good.

Operator

Your Capital. comes Nachman next of line the from question Gary with BMO

Gary Nachman

ASCs. competitive the any expecting based portion there market? experience some get they'll on in So think fashion, Heron's on with barriers sort of the uptake are it penetration if you discuss If dominate with product. used to able Also be there to do some ASCs? dynamics is that you your Or the in really were in of the

Dave Stack

expensive reimbursed. honestly, only and -- less reason they the Gary, only that anybody the would Well, is this, EXPAREL I ASCs, EXPAREL. even reason, think than In admit routinely would it's Zenrolefis the use because

wouldn't was cheap, somebody if only exist to -- are be opportunity was because it would it be going try there that going to both So reimbursed. because

increased CMS EXPAREL a to recently, fact, a of In reimbursement $X.XX milligram from milligram. the $X.XX

contracts who get they that CMS. EXPAREL customers big discount and the commercial payers at slight a from with And purchase lead. the we self-insured see actually us can to So have reimbursement routinely follow the CMS' payers

of -- the it's think because places a about the is least use that label, few there ASC, for all that I use so can you narrow it And worried an only is might we're you a this product, things.

arthroplasty, that that insert only safety knee damaging the Gary. the the total is that hovering in and XX package X data shows it's still hours, pain is just but not XX, XX think a acceptable I the around score there not XX to is really section

going said, somebody were because reimbursed, reimbursed, bucks, save if that I if couple was away. to trying they like to option it's that it a So of use -- it's falls even

don't it. I just So see

Gary Nachman

just then And on a follow-up Okay. EXPAREL.

types they the Just much broad-based? trends change you space? of point squeeze of on is be question. adoption driving in there likely spine little point? you in significant view the uptake on the Would one hospitals most seeing previous a this you diversify especially competitor have Are of to in more last the more more one. What focused leverage far? And the And just to you're portfolio similar how recently? just in in have most that comment considering the types are any of and further opportunity been C-section certain now that Or a anything then I'll this that deals thus referenced iovera°? more you at rapidly Are infrastructure, that you this at

Dave Stack

Gary. Thanks, Yes.

us around to providing around change it's how to the it's can a the baby minimize hurdles the a birthing centers. and short surgery involvement short-term is, institutions stay. women's on after and in our we really to moms some afternoon, call in and pediatrician baby be so tactical or we're groups We how C-section And do which discharge the most And a birthing women's big areas see overcome environment. have places. that really opioid no institutions exposure get curious way mom time that you right? and that firms no -- out in So to COVID the a -- after. into standing a takes a that country mom the center discharge building much We not see the the handled kinds we it's you interested have generally, health, that there's sparing, like any are equity possibility different looking being problems, you enhanced a relatively do in you baby same-day of that around are Gary, would in there a all of protocol, so recovery surprise, for way the more that significantly place of -- that big OB/GYN starting in the a who interested are the of they're I Because construct private it's number health so see a

Alabama, lose And that borne, the born of the tell Tennessee, payer big Arkansas, are in putting some in see These interest of hospital services you those the moving C-section or can for the It's just systems at there's gals chains frankly, days. that payer involved X So you southeast, out you've in in every largely centers. largely big in these cities and do. as them don't aggressive mandate on would where not all. money as social the real support got in possible where that they that's quickly also type they system, hospital hospital

they're hospital largely trying so population. to those gals that patient have can treating for to days by the with to that that say finances free and in driven associated change X the And regulations opioids, those stay access up

the a again, shorten stay, from provider the try to has to same it's perspective. a it outcome of reason So bit length of but a different

Your BD, Basically, to philosophical last we or is emotional we have big transaction. a what question do don't reason we've Gary, wouldn't relative any that said,

We or scenario situation. of capital to have our given current plenty access

would There's something We're haven't we And to we enhances So do just that to and wouldn't, the price-conscious. big all love do deal creating we're groups, of no shareholders. can silly. found that opportunities for these physician make infrastructure going we will we with Gary. do we that et But something value and further deal I sure reason relationship to think why yet. it, we address ability are our and not our find price right justify if our cetera, the we

Operator

of the next your from Chiang Northland And with question Tim Capital. comes line

Tim Chiang

bit this issued to patent? plan that additional could just were Dave, on sort on little important talk guys you be [XXX] comment patent a EXPAREL. you IP about you That is what How of would put great. EXPAREL? just recent And around this

Dave Stack

Hugely important. Yes. Thanks, Tim.

December background, -- IP IP going our year. expire was on to Book our of Orange this listed XX was As

unexpected So now ways we've the gone it's into with that that we've out the were Tim, as will to process EXPAREL. manufacturing improved also XXXX. for processes, associated, patent but observations extend current larger in

from and it that to new I place, tightened a of to and we've anybody think manufacture the for our us able you to be also, of to associated difficult relates that filed been so very most second to are the be your further IP with specs to an opportunity know, PTO. And have opportunity It it IP first generic the there listed and in EXPAREL liposomes is multivesicular have outlined the question, with we assay. also Orange are those make opportunities, it's the a the the Book FDA new consider to duplicate. an And as process answer points as additional part exact like current probably as gives that, patents the would the new product have Tim, think important of

look this patent a proprietary pretty would I much So we have terms of an telling and never are what impenetrable improved this those tightens around generic against that to is, released in assay specs around assay. anybody EXPAREL what estate a proprietary And like what having a specs or assay think, EXPAREL. the makes

Operator

back the Dave remarks. to will I and closing now turn Chairman Stack, call over CEO, for

Dave Stack

like call. to for our keeping on today’s Thank We in you thank you, Dawn. to updated you all look I’d participating progress. forward

Thanks with Wedbush all. up Conference week. Stay is next Goodbye. the well. us Next

Operator

call. today's in participating conference for you Thank

You may now disconnect.

Pacira BioSciences (PCRX) 4 Aug 212021 Q2 Earnings call transcript