LNTH - Earnings call transcript Q2 2022

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Operator

Good morning, ladies and gentlemen. Welcome to the Lantheus Second Quarter 2022 Conference Call. This is your operator for today's call. [Operator Instructions] I'll now turn the call over to your host for today, Mark Kinarney, Vice President of Investor Relations. Please go ahead.

Mark Kinarney

morning. good and you, Thank Welcome to Call. XXXX Second Quarter Conference Lantheus' Blanchfield, Anne call President Chief With Officer. Paul today's Mary Financial Chief Heino, and our me on Marshall, are our Operating Bob and Officer; our CEO; Anne turn call operational then update. Mary remarks provide Paul the begin with over the introductory will and to to an call Bob our and results financial will updated cover guidance. Mary call for the we will Anne open will provide closing remarks, and then Q&A. release, X-K, This Exchange which our issued morning, press was and results. Form a the XXXX Commission to quarter under reporting furnished second Securities we

You our can find section the release in website the Investors of at lantheus.com.

you the presentation tab. our For not those the section under find website you slide of the of Investors on webcast, Presentations can the in

change turn and materially. GAAP call during on measures our now Anne. included my Also, our will would to Please over if the of most results Please to to risks directly comparable our of obligation law, started, Actual as variety even Reconciliation call you of to those a to Investors filings the financial these the non-GAAP get or may differ these I I and required the it's materially forward-looking update include Before measures. uncertainties. will to no by a certain like financial that discussions forward-looking except actual due include these expectations future of measures refer pleasure forward-looking statements, from section uncertainties. is we assume statements also applicable results detailed by note statements. this remind website. call discussion indicated that, that Mary for to comments risks SEC during With

Mary Heino

led as our ago, are I'm share year-over-year, another imaging on we we execute We in radiopharmaceutical reported by impact everyone PYLARIFY continue year markets compete. PET joining Mark, a the oncology Lantheus the growth, that, portfolio our a you, XXX% with morning on record launched and for category. particularly accelerate quarter category revenue, leader prostate as pleased we up the quarter Thank in we to row, our delighted in position in had making which U.S. X diversify Having community. outstanding and cancer to PYLARIFY us. the is second PSMA-targeted good growth over strategy to just to

at pleased field fact, endorsements in cancer seen In Agency, and that the trial on Phase to or National III Imaging its May he highlighted experts May, E. in important the SNMMI, to F-XX of California the EMA, June at Investor submitted the prostate are the Dr. in EU, piflufolastat PYTHON marketing Diego, University European guidelines application note Crawford's, along Network, internationally inclusion for our of Crawford, renowned of few Curium Dr. inaugural for for PET that with from Comprehensive steps PSMA the to an such PET the U.S. imaging Day forward the or he believe Society PSMA-targeted Medical the the speak both and we Cancer David or Medicine is of NCCN, its most believes cancer one last Nuclear and authorization Medicines in XX. We prostate in the San as that importance has completed community. clinical decades. imaging urologist in In

of PYLARIFY of cancer. patient PSMA avidity will be for selection. as the be of hormone versus of trial trial, majority and add to U.S. part PSMA-targeted castration-resistant multicenter efficacy prostate used a trials Curium's also ECLIPSE therapeutic PSMA-targeted vast included therapy study now will in comparing We in with patients to U.S. safety determine late-stage Curium randomized therapies. worked to the PYLARIFY with the its III open-label metastatic PYLARIFY Phase

the further Dr. utility agent. updated The The at contextualized and SNMMI algorithm Earlier PYLARIFY prospectively with of from by Nicholas for study management in AI in efficiency, and along PSMA Urological our PET databases in noted has results the Association's of Dr. quantifying AI-assisted disease We to planned PYLARIFY been an effective as meeting, second Calais enhanced received meeting, and confirmed growing independently on to patients. with in the and PYLARIFY and PYLARIFY was the Nickols in this interpretation AI AI diagnostic PYLARIFY care AI accuracy our prostate world. PSMA annual III of additional clearance having results quarter. the to with imaging predict AI CONDOR AI-enabled detecting provides of rapidly quantification cancer. quantifying on the and Jeremie FDA PYLARIFY the annual of and AI data PYLARIFY validated presented clinical as largest PYLARIFY year, serve PYLARIFY trained an and evidence learning utility and prostate the presented of and performance prostate biomarker approach validated disease androgen by validated of independently patients Phase consistency enhance images identifying one study. image progress and deep PET/CT real-world during PYLARIFY-AI of therapy. These offering, enhances continues could AI our cancer of how the standardized the of also the response cancer deprivation imaging add a an American to in

community pleased PYLARIFY to cancer the PYLARIFY U.S. with prostate find to support are We disease. follow and AI continue and to

with physician headwinds and with by noted decrease Our sector. visits in in grew healthcare despite the companies associated market-leading other agent, challenges a ultrasound-enhancing consistent staffing-related DEFINITY, the trends referring

staffing DEFINITY challenges persisted quarter year-over-year year-over-year. While in-person nurses sales grew healthcare U.S. cardiology during quarter institutions, visits were for U.S. at reported down the and

contrast-enhanced will was cardiac second to in expected, echocardiography confident quarter continues abate. important an lower growth role growth during we play the and are DEFINITY normalize believe challenges than we these While imaging, as that levels

to development now our Moving clinical programs.

assessment cell development PD-LX progressed X products: cancer cancer. currently our the of our We in our agent XXXX, I-XXX for prostate non-small NM-XX, therapeutic; recently pipeline imaging PSMA-targeted have of and expression novel under lung

patient XX in we last the trial. total, the that enzalutamide ARROW XX patients alone. In to and group in pleased plus in enrolled XXXX been have enzalutamide XXX have group the combination I'm randomized, our XXXX, For announce

ARROW in As a radiographic-free rate. Patients trial to endpoint the year Key ARROW progression-free be PSA forward time X for for look after is endpoints. be overall Survival and future. reminder, their sharing first treatment year. in for secondary prostate-specific will response the followed additional survival antigen and more important all survival. will data primary milestone, is endpoints progression, and safety an an or efficacy include I collected in information the to That

therapies results results monitor has indicate ongoing I SNMMI. lung response in to patients cancer investigation. to the identify presented These that to at preliminary Phase and non-small were an therapies, who Moving study PECan these potential of PD-LX express early the checkpoint NM-XX pending these to of the NM-XX, respond study patients the cancer cell further will inhibitor evaluating

immunohistochemistry assessed The PELICAN the both study we the patients compared study endpoint measurement enrolled King's trial with primary by of College, expression as being primary of in results. cancer, non-small metastatic May. of is lesions, Phase the to initiation in In IIa the I and addition PECan the PD-LX PELICAN NM-XX this run progress to PD-LX cell tumor continue to asset using expression first lung and Phase a single-arm

match portfolio, expand assets several to our ways opportunities priorities. and seek or acquire collaborate, to evaluating strategic in-license our further to continue which We additional

and portfolio. complement focused are therapeutic product We and on existing our oncology diagnostic opportunities late-stage pleased in that particularly

In strategy business. addition, our also drives certain that pharma align opportunities early-stage with the services

uses. patients positive and example, clinical agreement for therapeutic diagnostic we assess cancer of platforms used collaboration entered initiate both selection. expression research Phase Australian-based products their diagnostic with tool recently to is For for a an non-small Theranostics. Radiopharm product PD-LX NM-XX, in for into in a Australia. I to PD-LX a patient Radiopharm trial radiopharmaceutical Radiopharm with cell clinical Lantheus will to supply lung of candidate, therapeutic developer as Radiopharm to be trials, plans our

expand have assets our also option to to retained additional We pipeline. partnership Radiopharm's in the

tenure Finally, Paul the share in since Chief I Lantheus team. business commercial, that the I Paul Officer. his June, communications. I like Blanchfield had taken the in made leader longer-term strategy. to has joined In and been January a exemplary command and Commercial operations, technical the Officer. important to Paul In Paul manufacturing XXXX throughout data I've and responsibility for would his role attention as of role, combines has pleasure with an the corporate drives of new Operating he promoted an executive Chief of working strong with to change recently quality

Paul Now an let the call on me our over turn business. update operational to for

Paul Blanchfield

everyone. morning, Good

compared during to market to am the PYLARIFY, for PET $XXX.X we and continued announce our in for noted, to in Beginning DEFINITY. As million execute first on the pleased quarter, sales the quarter. I million imaging, PYLARIFY PSMA-targeted strategy Mary $XX.X including net leader PYLARIFY with Anne

our located which are and Florida, PMFs agreement nearly of software, that relates York are our announce our geographic partners with also our redundancy flying in our PMFs, U.S. I double practice capacity, an that where additional one to market quarter in previously been many am geographies footprint have and West are in New the with manufacturing new extend number PMF and reached and quarterly monitoring new U.S. PMFs our PYLARIFY facilities, our and of meet while activation during add which progress new and pleased the We This we including to make to enhanced capacity we to geographic XXXX. for to addressable their or through AI had doses. redundancy, agreement X access of TAM. since continue will years the customers, and to PET manufacturing key guidelines we provide come. call. and continued expand to We as or expanded needs existing partnership it of geographic cancer earnings the footprint, community market, the geographies in capacity enhance redundancy medical prostate can footprint our total These PYLARIFY and Virginia, last and Colorado ensure

competing with of including agents. use across adding NCCN whether to imaging the availability PSMA end government earlier PET We freestanding also guidelines updated continue almost have to the PSMA imaging both all PSMA-targeted endorse XX PET respect centers of including of the for new first selection Columbia on to from their ordering the agents, imaging This therapy, focus they PYLARIFY, SNMMI the District this for facilities. customers market patient quarter, hospitals, XXX approximately and is or be actively up XXX radioligand now the customers access, of and Pluvicto. We PYLARIFY. states customers, With at even year

sales have including Aetna imaging in reflect and particular We BCBS, with Blue commercial to note are several of avid to in pleased Shield, for have Humana, F-XX advancements, by agnostic quarter, choice PYLARIFY, may the eligible used for patients made combined to piflufolastat or of as Cross radioligand agent more that alternative I progress approach manufacturing speak $XXX to PYLARIFY our name to policy highlights identify payers, Blue this to Humana's these benefits scalable who note an lesions the capabilities. PSMA the want be believe with its We updated AI. network with policies their also million we clinical Anthem and tracers. operational therapy. than an to other

version cleared AI. the mentioned, FDA Anne an Mary As updated of PYLARIFY

In positive and impact on addition, leading and it we this AI market forward. We trials. incorporate will PYLARIFY's therapeutic believe institutions patient at PYLARIFY care install sustain continue a continued PSMA-targeted help progress leadership to going into have

you Investor takeaways in told I for there Day During key were PYLARIFY. May, X

$X.X significant with opportunity, market PSMA addressable grow. that a of continues imaging approximately to has First, total PET billion

potential, And what third, advantage leadership. a and of have sustainable labels guidelines in the first there's we with future. into is expanding has that the translated Second, we significant long-term market mover significant believe likelihood

expect specifically, based TAM oncology, guidelines as that the for and to on real-world evolve, same continue we see in we I the practice note experience. frequently it On And would does areas. more broadly in XXX,XXX PYLARIFY its the X could PSMA primary XXX,XXX scans from increase an by that We and April, we PET specifically. from TAM scans additional believe existing highlighted medical

there believe additional in patient castrate-resistant first be for which currently and studied. could the PET in second PSMA selection prostate scans PSMA-targeted for we First, are line, being metastatic cancer therapeutics

intermediate expand the to usage favorable that patient increase billion, approximately of populations, TAM may additional additional population. up imaging believe PET over These to to scans billion. would not patient the but XXX,XXX limited $X.X medical from we $X.X including time PSMA Second,

solidify the as continue PSMA market, believe positively efforts to our PYLARIFY the community will thrilled prostate to of well foreseeable of as expand half continue will as to and evolves. I therapeutics, practice, agent PET impact first am continue monitor the for to with well opportunity results We to the choice both the as for our continue to as PET it for update and guidelines PSMA the addressable XXXX, medical market as the continued total cancer future. imaging and radio

Turning $XX.X now year to in sales the quarter DEFINITY, to quarter. the were market-leading million million ultrasound the for prior second $XX.X enhancing agent, compared

as receded, backlog in of second staffing year-over-year we at and challenges DEFINITY quarter, echo the in customers. visits, increasing capacity-related and COVID-XX quarter ultrasound. during particularly first note the customer a growth While in-person a largest patients saw cardiology We momentum noted an many needing in decrease impacted levels customers our

We will demand our staff continue XX% remain as the have Bob? reviews agent over and growth he to market, part support for guidance echocardiography ultrasound share financial near-term to the hospitals U.S. more enhancing his Bob agents. believe adequate but have show when of update. current of constrained until ultrasound about will XXXX expectations enhancing

Robert Marshall

financials, everyone. on I Paul, adjusted good and focusing provide Thank morning, second you, unless the otherwise noted. will quarter results of highlights

XXX.X% million, increase the quarter share $X.XX of the for was second over or the of an year per prior to quarter. were Earnings year increase period. Turning $X.XX, approximately million the Revenue second over the prior results. $XXX.X $XXX.X for an quarter

sequentially with slightly X.X% compared turn higher the of our was included as that which sales, we just AZEDRA reasons increasing expectations X.X% significantly $XX.X driving of details, care contributed prior a sites sales from Oncology with year exited Now million, by to the rebates year not due sales and Paul. the did explained a contract on $XXX.X the from quarter. year to to DEFINITY up the $X.X prior rapid leading last efforts million referral contribution and than ramp a includes $XX.X constraints. Diagnostics. for net $XX.X approximately result in prior this I'll lower down mid was million of TechneLite to of share million, Radiopharmaceutical quarter, COVID-related of from net quarter primarily Commercial beginning remain Revenue of repeat of prior Sales and with the comparable our year PYLARIFY. were continued lower This allowances down of quarter bringing the Precision in an year also well voice revenue year opportunistic as as focused campaign. impact continued quarter. million per due online, XX.X%

was RELISTOR to Unfavorability digital of Gross an and for the in year million, not the due second margin stream. by current XX.XX% at driven category strategic $X.X result Lastly, partnerships first repeated quarter the other of prior cREPO solution primarily royalty the year. for profit comparison a the increase Fuji, sale quarter XXXX over revenue XX.X%, includes is to XX.X%. the was

operating is case short-term up now higher points, as agreement work or to expense revenue Of rights. year to the to both business Total million as has As non-cash our million that been this mainly discovery workflow support XXX paid or were or taxes. portfolios. from is contingent expensed in million development quarter, February due in the liability, the million, as and The to expenses be before we quarter in its million PYLARIFY XX.XX% $XX.X of XXXX, Operating amortization were of Also maximum in by been the by increase fully logistics Operating in amount, the merger on part even efforts profit entirety. the of highlighting holders as by may commercialized PYLARIFY mix, growth investing and recent same quarters, stock net and intangible the improved associated of XXX.X% and the of net to led has net to the incentive period year. offset amount and amidst $XX.X liabilities, increased revenue million is million increase in product $XX.X the was is and within XX.X% in costs. in while well approximately prior quarter, the favorable respectively. value plans sheet drive prior and in the DEFINITY, chain adjustments balance current which with at under G&A sustainable CVRs contingent sales basis leverage $X.X $X ERP for favorable acquired $X.X supply and expenditure, efficiencies CVR million an we travel of accrued pipeline related XX, grow. dated liabilities over R&D quarter $X.X recorded for a $XX.X marketing of our rebranding, percent XX.X%

to amount liability we XXXX, further The As expenses. no with and expect the in beyond first integration such, would to amount pay of this date. or related is non-recurring half this remainder acquisition, other

Our XX.X% effective rate in tax the quarter. was

increase of an prior diluted the quarter second million share approximately higher unfavorable respectively. $XX.X slightly state and of were $X.XX an is adjusted income million rate with tax on higher $X mix $XX.X fully of million the for run sales rates tax from reported million respectively. an increase and per was effective The Our recent jurisdictions. on resulting adjusted and $XX.X $X.XX and PYLARIFY $XX.X earnings an net $X.XX basis, and GAAP year basis, than

cash to turning Now flow.

quarter totaled the up as as flow less $XX.X expenditures, expenditures Second quarter. flow of million compared over was $X.X the year $XX operating to of which totaled $XX.X million year from flow, QX period. Capital we cash prior XXXX. cash Free slightly an million capital cash million, operating million, define in prior increase $XX.X

at ramping equivalents to PYLARIFY cycle. and beginning through impact are Cash to capital it cash the We net revenue cash working $XXX.X restricted converts of cash million. as now the stand see from

We continue with to position. revolver comfortable access and liquidity are very million to bank our our strong $XXX have undrawn

of range quarter to revenue guidance for increase XXXX. be an Turning guidance forecast for XXX% of third to in million our now and full quarter over approximately the to and the the XXXX, million of the year. of $XXX for updated We QX third XXX% $XXX

full actual half to we first into are performance. noted, consideration As view year take updating our

with issues record year, range. at to in year us forecasting ongoing coupled post to DEFINITY the staffing high-single-digit results second hospitals DEFINITY the cardiology the lower-than-expected dollar level continued half of have While visits in mid-single- this has

million, share, to surveys And Therefore, recorded backdrop. of in now trends to million believe PYLARIFY, This user from $XXX we includes importantly, expanding prior of in to regard recognized million forecast are to the uptake. range DEFINITY year not which quarter. to as million full transitory. updated range and do With from and million these range $XXX $XXX the I coverage of that loss continues Novartis at million. Our million at indicate we the mentioned, revenue to $XX $XXX grow and model this was now amidst any we with be first PMF the revenue $XXX have $XXX

Turning now to earnings. Adjusted for $X.XX $X.XX the EPS should of range in the be third to quarter.

are of versus $X.XX $X.XX. We of the to our expect be the We as that, well $X.XX higher prior approximately to of $X.XX. share let raising PYLARIFY now outperformance me had contribution EPS half back $X.XX an the now the for account aforementioned adjusted over With first Anne. as EPS impact in agreement of range Novartis Mary the adjusted turn to expectations per range EPS to of to the incremental and adjusted full year inclusive relative from revenue call

Mary Heino

like you, leave you In a closing, to Bob. with Thank I'd takeaways. few key

Our outcomes to mission our to disease patient guiding better force. find, remains and follow fight deliver

markets We continue accelerate category compete. as Lantheus strategy portfolio diversify position a in to our the to growth, and execute our which we in leader

key our and revenue outstanding drive first long-term category-leading continue the on drivers our and our deliver to growth Our be to of XXXX The and for strong financial shareholder goal our to value. strategy half of execution growth of results record products. our the ability reflects

PET cancer product, agent the solidified For imaging U.S. grow and the have for prostate we market to market-defining choice PYLARIFY, the it of PSMA community. now as our continue

visits headwinds ultrasound in with decrease despite staffing-related market-leading referring associated grew physician Our challenges. and a agent, enhancement DEFINITY,

will ready With of driven growth half take Bob, to now continue your disease the fight our and the Paul year find, are that, expect We outcomes. by second and passion our better and questions. follow deliver to for be will patient I to

Operator

Company. of Newitter from first [Operator from Truist Richard line question Instructions] Your comes the

Richard Newitter

and the taking question quarter. Thanks on for the Hi. performance another excellent congrats in

comments for questions of you thank start me. wanted the couple the Paul, I a for with TAM. just the there TAM. on off to So

a about size. the I think figure you if size now. right out guess I trying I'm are $X.X guys billion talking to actual to right that's

component next closer given diagnostic to not thought but Just the on, you're penetrating, TAM, to performance suggest would seem or here. next or than guys to few to quarters the year you that me PYLARIFY -- and that the much of penetrating, potentially piece, the close are component trajectory that either therapeutic have we it the in would the the diagnostic within

X, it portion that what's bigger million it? the math, would that that close my patient, that, would the to, unfavorable suggest kind accounting it for the do is per you By was to follow-up it say So X.X get X, closer And X, it, the you're physicians of like, that that million scans, beyond even expansion? is exclude assuming, piece, to probably they $XXX that or but be to to just anything diagnostic intermediate to therapeutics to would added you're maybe when if is which piece, TAM double. when TAM assumption using it you that it $XXX scans then, would on seem to call therapeutic only what is

if -- about just -- that I correctly? thinking considerations. So TAM Are wondering could we am talk about I those you that was

Paul Blanchfield

all, of to or I first and so. your obviously think the question market incorrectly. preparation for determination And do. thinking diligent the times X a total the and team months raised you're as medical a total you you our the imaging NCCN thank research leading don't last well We've Rich, about this practice. really guidelines XX and like between as over institutional of triangulation SNMMI, market PET addressable the indications, So PSMA that continue for is and addressable

penetration guidelines that for recurrent what addressable billion. add line we population, very are $X.X is, as well radioligand our particular, our based risk in assess earlier of there as therapy nuances does the metastases, are We've as to opportunities we is as medical approved that both the continue total recognizing indications used on the you PSMA of so evolves. PYLARIFY But pleased that therapies and it's of with highlighted market risk metastases and use practice and some oncology are for indication. imaging, clear in in radioligand PET We as physicians that know, and at currently earlier in

future so And this correctly per And you basis, very see X assumptions you number scans it's We meaning as highlighted know, is to make growth. we've grown patient. the patient sensitive times scan per recently. the of that per on

You're increasing therapeutic correct to that for is we using Pluvicto only you this, but still of months, an has in space, as number physicians practice been a heard know, say you evolving. that I have also times, much the very remind particularly medical in I'd approved and particular think so few

our believe to penetrate growing penetration I think physicians work PolariPy and come. will that with catch imaging and up market be pleased the and to years guidelines this market, many and continues we're we PSMA for that, to continue PET will as and a

Richard Newitter

you. That's very thank context, helpful

that XQ million guide, why that I with wouldn't and the just PMF all step $XXX guess Is -- there million now capacity is curious. you've that sequentially? few continue more or coming these any to been online reason York significant -- Is in you for there Florida past the approvals. implied a more gets year. rated more so or your That to quarters, given know run that's Just up are the mentioned in you implies much guiding rest to but I'm for PYLARIFY have how New way. of the $XXX online PYLARIFY respect performance with there. to I less consistent less

Robert Marshall

half relative make versus greater year. -- of at the back should look total call can of in total take improved the as Paul I'll second it. does and between, in sort updates this still But growth the of a that, from and $XX maybe second it, through entering that is be marketplace just half half, contribution small, first million marketplace we as think, revenues. sequentially the what you at showed total appropriate. that but probably is But I that is volumes? to go continue the half POLARIFY significant qualitative a to so -- math fill bracketed will performance is or XX% had albeit what and at we're million There's sure I of or still the XX% what in our it now, make I watch competition the staring that is aspects of half last and sort If juncture, our first to now been nearly terms demonstrate I $XXX that year, the we there, to right performance competition

don't I still skis. out get where year, for a to and to again, us reason need think lot very that pleased our So there's going. There's over with runway a we're of in the we're

Mary Heino

is in you with think intro this to I PYLARIFY. to But question: that guided the the your said it consistent way we have in quarters recent

Richard Newitter

reimbursement aggressive I now, and forward guess, they're you in some gallium that's out at have little tailwinds back? you a now their going with are the radioisotope. the right guidance for competitor contemplated that now your seeing in mentioned guidance you have in what's updated they marketplace competition, On your helpful. there bit What more competition? another That's -- the marketplace

Mary Heino

step that for approach and am me to competition, typical talk moment I guess always we wonderful about PSMA-based in of cancer about we and PET and doing. talk has see That because But I going here our think been aside our been I see product how I imaging. focus my what to and want anyone the the remained. innovation a we're I what is knows market brought prostate continue to has community knows about think adoption who kind that is where to Lantheus, talk the I of it's has important.

out important the analyst shareholders it's the community, that are also decisions. who that -- to be think only I accurate making information but not to offered

been what X into that's And correct of the is of so fed the to one think recent information about fairly commercial the entrants I'm inaccurate market going agents. I some PSMA-XX

what reported come say, market, first PDUFA kind market, the So used. $X.X X XXXX, kind look approved in that -- post by quarter so the In then of and of full were PSMA generated even PYLARIFY's the market. be market. the that. no recently, They now how -- posted, delayed by the reported the successful second both the other for companies $XX -- kind than us these the in the they've $XX.X of built are and early that And and market, is look agents, missed would with X PSMA-XX million. know, just in -- riding its the has This and This in though product, I'll revenue. we approved claiming X to products a it the of for reported company been one it's kind PSMA-XX we had them quarter product on -- in million PYLARIFY full quarter agents take by they're public to there's months. was, I'm vocal you a million. going Lantheus in and at momentum wave that's on was they're launch what all revenue or in restricted full geographically late approval PYLARIFY, academics. of More generated compared which at and approval were then of you XXXX, the we revenue happened this -- just first approved X its have if whom then And at of finally public as in original they fairly execution a look had more date X

and the successful that what firm sales claim The else everything and we've launch going Lantheus. in as far building as take and I'm in is a and that say that what on making of that This patients I we've a and building access product available. kind So capacity, going again, building for represents market this to is, feel for one-time physicians numbers our and done awareness, for market about, this [indiscernible] we take stand product a terrific victory to I'm done for important. feel

PSMA-based serve, believe to a course, the patients going to of the there well our PET on are that continue imaging. stay, work prostate to and as serve as innovation in make company, have patients we We we we sure to the to are access community, cancer what as, truly physicians and focused commitment breakthroughs shareholders

sure not question I'm your answers that So if there.

Operator

from from Zach of next Your question the Jefferies. Weiner comes line

Zachary Weiner

I past And competition. everyone, if and great Can I about I you the about you've congrats manufacturing just of provide in on in for curious on wanted of know comparisons, gallium talk some terms of Mary, the the manufacturing half-life benefits could question. just side the thanks the on another there. to Hey, continue, taking color F-XX could, the but quarter. versus any talked you side? if

Mary Heino

of differences here that to than Essentially, lend F-XX but Paul closer I going is on aspects the versus it X -- major add as am, -- themselves gallium. advantages. double, there's because essentially of what's It's itself grade and takes One time amount the available. is into to when half-life everyone of is of half to in fourth for really the kind there's as far if half-life you chemistry, remembers isotopes here amount some it he's

deliver product. you the have you logistical time, when availability twice to twice the So essentially, have -- the can you

advantage. that's one key So

using you you're so upwards XX that a than cyclotron, produce When scale. we've can of is patient manufacturing you're what X in seen, already run means, and is can batches. batch and you F-XX, doses in day. and more second you're using The that what producing per And batch, a

that manufacturing a is large-scale approach and matches truly population, patient a population. is unfortunately, this large-scale cancer prostate a patient So

that's manufacturing from and we patient So better feel why serving, what description, -- match. a the F-XX community a approach you're of is why and the F-XX matches -- that

through States important as total serve own, generator. given perspective, -- do is is doses have a own can prostate a at be thing say of to half-life. from enough is is Now, have got limited well. that U.S. community. that any number we here the now gallium most I'm And about it to through our that important. cancer to capacity scale cancer produced we a means, that, just market. The on a serve just can as that is have limiting. from more -- Its the built capacity is a though, fine pleased the United process prostate what's time, and What isotope network capacity XX-minute It's manufacturing we built our is That

U.S. and has where just areas that challenging is we Now, do wise continue know, availability there community. of are we to geographic the of there, add? to even that meet But centers. can all in I population open here population where, the fill kind because sources Paul those cancer -- -- been -- we density demands the of you of -- prostate Paul, new ensure want to certain as will

Paul Blanchfield

Maybe just Yes. a few Anne. points, Mary

is million I annual network the done an that basis. out prevalent on most is PMF That this an there country. image over F-XX-based is scalable doses think it's agent product important that the FDG, levering across to remember same X PET with

working And health community this accustomed same so to very from in practices F-XX, embedded for these is care decades. the because PMFs, their ordering with to is

across And PMF so provides the an #X country agent we're network FDG. PET that levering existing in the really

relative are PMFs be redundancy doses be XX we PYLARIFY, notes, to Mary so I've a There of that and or able travel, Angeles, that think of provide additional market we plus and and to And acutely adding able PMFs metropolitan that Los up to in XX%-plus believe New those comparable markets. we we -- second we've when to Chicago, Dallas Houston in York, we -- opened advantages. and major on accessible just believe But those we are of our easily the of our and into Anne currently and are District Mary will of ensuring markets PYLARIFY to the weekly naturally sustainable ensure Montana, Hawaii backups. we are demonstrated Anne repeat as as that key doses there manufacture basis in regions, we at are capacity quarter, look geographies, can market-leading nor in continue fly customers as we're key the to continue mentioned, to on share to to areas have can and are share, can Idaho states naturally when provide going provide new competition, as where not we are focused mentioned, of We those in Florida have F-XX Alaska the roughly Wyoming, on has Columbia. with of markets

Zachary Weiner

all had provide to and manufacturing inventory margin benefit on a think and in-house? the the of start as time the Thanks. to DEFINITY shift Can when I through historical being see to just produced one from should we sell just in in-house. line you'll Thanks. you you DEFINITY

Paul Blanchfield

co-blend, Zach, partners you if that we and produced of co-source, are will from continue of will, for years, external both we've number to together had in-house. any sort with batches that being

as any and DEFINITY, gross growing, continue shift will and naturally. over is its from benefit to margin mix are of about those happen so the time ability PYLARIFY years, well incremental volume our by it's talk manufacturing of own as that products expand, benefit to driven over incremental. Now, The incremental I will we'll expansion in-house that next margin -- if that: -- time, just

show do which particular actually expect from continue next of the the just inventories that So probably to -- existing working worth here are of I of year production -- would batch perspective up those benefit time and until expect to the period. sometime it year. bps' and to frame contribution year doesn't you of late we through the probably contribute because in product see that course, increase production, of batch second first in But sell half this inventory that into that

next that mind you year -- inventory work it So a benefit. see think start XX-month shelf of into sort time next, levels, the life again, and to has we and the DEFINITY in because would keeping the that's through that so, I as starts that horizon

Operator

from is SVB line of the Your from next Securities. Roanna question Ruiz

Roanna Ruiz

on and morning good progress. my also congrats the Hi,

two PYLARIFY. quick So me on from ones

you push XXX customer could numbers, you do now metric. to half follow-up. maybe and and have And influence year? mentioned this the have speak to number customers can't the just noticed into it on elaborate First, expect grow this the of product, help if I that how a ordered the would And to you exact I second pulls

Paul Blanchfield

there's we the would customers of across the I centers mentioned, imaging those to have And be referring they with so oncologists are we like cancer. community. it customers. referrals and And those prostate as when urological and community, And by see expect we facilities XXX that mean customers, they would VA that's needed, who prescription from define to continued at approximately to one imaging I flowing number the Where our we is prescriptions then because PET XXX imaging the the grow, wouldn't by medical end PET into the to referring country. do growth the up And imaging expect of but quarter, only scan many just mean be is accelerate, centers from and urologists, clear, hospitals. first whether run to to send continue So, they XXX amount managing scan. of we so freestanding facilities, approximately we government oncologists as centers, men a or determine a current

when the significant treating will number so, time the the say, And see hospitals, have marketplace. over already -- of naturally we we but increase, see and growth, of penetration an that -- should that government sites imaging I centers because slow we facilities will

on a efforts Our XXX% of community, those to demand regular customers can demand. XXX and increasingly many have repeat continue ordering focused, that awareness additional in and with now to them referring ordering the commercial are basis, we of drive almost to because drive continue

community, forward. bulk in phase really where going within generation growth we're we so of the see the that's physician And demand and the the coming referring

Roanna Ruiz

that and of of give use or I curious, now ask, And keep to noticed I'm PYLARIFY couple you a of expansion indication in wanted in future what of late-stage you trials updates? is included eye the mentioned possible the kind also does in therapeutics. for terms U.S. optionality I of on should And an therapeutic next do think PYLARIFY majority that in PSMA-targeted we what years, terms

Mary Heino

to selection avidity reflect is it's to So, patient included therapy to for trial being response therapy as PSMA clear, in once the biomarker and/or initiated. be for the a

patients, their to therapy. And therapeutic could the trial using think imaging see we selection to FDA in appreciated and I point PSMA-based that to patients. for those a products reflect from the their in -- that disease it's -- think, my as of and again underway for it the agent brand and then I to response utility would imaging for mentioned PYLARIFY reflect response that a perspective, androgen is patients at PSMA-based agents broader deprivation, broadly can the will at point my some you prostate that therapeutic and in that monitor referenced the imaging we response choice you but but patient's I labels androgen a in options Not and expect disease, is including the that at -- PSMA-based that throughout by that perhaps either absolutely name current are they labels that's I also that for being that agents how saying point comments anticipate the to use comments that patient I to still looking PSMA-based response then deprivation the therapeutic reflect agents, for speaks they at of will is may there currently therapy to a something of PSMA their therapeutic selection, an labels state the that intervention as optionality where an will utility for and of -- criteria think that cancer growing in These use in earlier. was value are use their avid therapy, is therapy. and future trial

Paul Blanchfield

response the goes or really addressable to patient imaging PET as used populations, patient new Mary Anne patient PSMA is it's potential treatment notes, in being this as following. these or total market think I increasing selection whether

as only U.S. and going PYLARIFY and And forward. but awareness benefit as used increase of studies just for not and cancer more the the radioligand usage, being these also importantly, usage as this notes, PYLARIFY the most is alternative particularly therapies, opportunity, has but potential not she to trials, prostate community, comfort the therapy, more in progress, so, only

Operator

Securities. next Your from of the Solow Larry from CJS question line is

Larry Solow

on Anne, maybe possible? term, we within a few might bit just and Good you last everybody. too, little the whatnot, the F-XX-based on but that on significant see front, will potential clarification, guys in with is XXX% that -- sometime you believe mover coming in the agree mid pounding their for PYL, the competitor of thanks. more weeks. thanks to Could long advantage chest competition just on morning, talk Great, F-XX-based? maybe again, terms even XX I when about one. and months, you agent Clearly, first on out? have Mary

Mary Heino

that it call let's now not thank PYL, we're Please PYLARIFY, you, [indiscernible].

Larry Solow

Absolutely. mistake. My

Mary Heino

forgiven. You're

whether back data market to to that that the So, products. aware and to the development, to support do development company, that a that that the so agents as we of and Bracco/Blue will those other private I think we by referenced access is with one has Earth, and many under we're as very not know, this I'm you the filed Again, been have under product come going FDA market say a yet. large is is

be first Rich, it discussions in to think evolve will on this to my and utility well. the with as we and Lantheus, throughout we in and at earlier noted best intend full we is what morning that Now, wherever our are clear comments discussion go, be. grow, to this as continues -- continues this a that, I But I market as

we confident we're increase. will come the leadership -- many both and that will with position, our retain So continued share revenue and market, regardless with that, revenue agents how enter

Larry Solow

on Is the And a I've anything a were, be -- in seems you talk you speak heard of you're but seem $X,XXX especially to could you some Any cliff Can couple I add you can like think there about can guys -- that? kind of that? somewhere be some color that reimbursement mean, bit? to would potentially like that getting noise I thought side. there what you to pricing down rate, maybe -- you in it are that all? little years, at a coming Medicare

Mary Heino

by start, but -- revenue of will our pricing your then points was I'm comments turn say to prices. loss we going going pricing our products, say but you Paul, hear specifically speak don't that over to to I'm on I our to for not that did Bob impacted any and of

price us volume Sometimes little a you'll bit. do speak we versus when about to DEFINITY, talk hear we'll

PYLARIFY. that then class, By that it to we for imaging is would there's -- agent say class I in the expected benefit might around design period, say. and where imaging class. that, about be it imaging price PET as have pass-through to yes, So going referred distinction to within CMS agent PSMA describe what the Paul a is there that reimbursement I'm to and approach impact let is that

Paul Blanchfield

distinction traditional is Mary Anne CMS As hospital we use believe, We've Medicare. -- to is in X-year Pass-through mentioned, forward. overall garner been setting case, is provides much that, in and refers What price, that of Anne a outpatient -- PET very known PYLARIFY with as pleased. a we've been the the for program to Mary line pass-through. imaging separate able payment going for this our expectations in

payment that I hospital it's program Medicare not so a in so X-year currently Advantage, mentioned, traditional which and only provides is outpatient for, the as differential Medicare, setting. that And

increasingly not to seen that of portion the that roughly population adoption government as we've expect X/X freestanding Medicare within Advantage centers, pass-through. as We then become be are And to subject XX% also imaging well as facilities popular. has the of to is overall which population, significant both -- of

provide being and we We've number And date. spoken alter even extensively so that reimbursement. of clearly is the affects would means a minority which of reimbursement and the that the business. on permanent overall discussed Senate, both House the pass-through payment sustain effectively to of floors the which and on payment the We opportunities currently believe a have FIND after and Act,

the our stickiness. to continue AI which of agent as we be able we are repeatedly, The to of We've some other to options about benefits to also work also then patients PYLARIFY to and stickiness. those that track talked rolling prevalence And provides out there the customers. increasingly same believe progress. institutions, think second piece cancer is we a naturally continue is so, about is get have with Prostate disease of scanned benefits with to

with with influence views population selection. patient And and the pass-through payment in have patient we've related minority the are very so updated payment. coding our We're of forward. been very radioligand to pleased we to the going and continue pleased monitoring And that payers taken regarding this coverage

Larry Solow

that but the this you line certainly operating getting how you in, going quarters? question increasing couple line should margin. at you mentioned couple gross kind better the on view just benefiting we next of of and the still And of If least I mix, Bob, driving you're just -- forward, more are quarter that's leverage, quarters? over slip those the just how expenses, gross do PYLARIFY margin higher, next for one margins. in may, as so decipher could so operating -- if I clearly The XX% Obviously, improved also,

Robert Marshall

The is can the range. I we had sustainable thought XX% that it being of giving guidance believe that terms obviously of be north XX%, of about kind kind in in mid-XXs so number sort a do of of

both continue with forward. help you benefit growth and point growing as margin certainly volume gross very those both look -- But out, volume things specifically the -- of we key drivers, going forward. PYLARIFY DEFINITY drive those to engines as things so look we are that Specifically going certainty obviously, we that, have as of is that to chain in XX%, supply uncertainty do I'm logistics not and our unpredictable, increasingly one would build so witnessed I go seen I think is to there. of all to the

do margins that think of I sustainable. is gross sort So yes, that of range mid-XXs

far in As that's maintaining I OpEx as we're sort making the singular are to range. while XX% are -- of leverage gain the a that number embedded longer term. And we're repeat of it as that reporting over financials investments there they also sort able investment, goes, in correct, within we and are won't that that think of again, exist what you're necessarily

also opportunity even at our as invest. expansion we're where the I range XX-ish from really leverage margins, are EBITDA drive about, further through go which sacrificing I down we look forward, to which leveraging base in at talked moment, as that we those without margin So, know the to adjusted is going had gross OpEx

Operator

is Riley. from question And next your from [indiscernible] B.

Unidentified Analyst

quarter. taking morning. congratulation you Hi, and our good on question for Thank impressive

us. two from maybe questions So

EMA milestone beyond maybe be a can you of after in to payments payment and part bit revenue? do clarify approval, think significant related the for the Will a there your driver could or royalty XXXX collaboration be that a Europe? First, from you your milestone the Curium

Mary Heino

called PYLARIFY is relationship with what U.S. for for our is in a the market the agreement. royalty-only-based market Curium So EU

Paul Blanchfield

and of sort contemplated that their ability with their And of think will, sort to don't how clarity to and update to into financials. about we how of of guidance concept launch in numbers XXXX as have addition you future I into [Indiscernible] to more the our provided to we if and stream, income relates kind Street believe you any get that we as have so nor XXXX. approval that as into give we'll forth been market. Those timing forward, look estimates look and we -- it

Unidentified Analyst

beyond And Mary Anne, more have I you indications expand comment far, on of hear thoughts guys if about such is you [indiscernible] can us. just Parkinson's oncology lot So then Maybe, neuroscience oncology, and thought one your indications? your to a to want from and Alzheimer's. as expanding to

Mary Heino

to whatever late therapeutics that in talking of of with diagnostically, going But third And oncology, the kind that oncology I be outside enter for we we're is good think That continue within term is much good those line very experience, and of They see X do about diagnostics have area, think, the for the agents, do use kind arena. somewhat talking pharma there line use a the the continue radioligands, it agents, therapeutics very lead investigation advanced line short terrific in though, a to services complex be the patient of we move which populations. question, the call already trends here, the our what that about of business, is -- oncology in I patient prostate and arena typically and I treatment use usage but exciting, in in certainly therapeutically imaging within outside as when emerging see, within that tend into that of as and is way think lines they enter. seeing of which in assuming we're within to the that good which get for there's become we're and available of also insight and see with lead then biomarkers we'll line might of somewhat in -- cancer, investigation both oncology. oncology oncology. are that they especially the data what and usually either -- will companion oncology that renaissance I are a just up to we'll then,

Operator

Securities. question And from your Mizuho Petrone is Anthony next from

Anthony Petrone

I PYLARIFY quick of couple the of you Thanks. well success it’s then and two and all congratulation so have here in a PYLARIFY and to and And launch congratulation on obviously on should valuation be fantastic team. reflected follow-ups. it as as

on of the Just through PYLARIFY, to patterns to active accounts. one start be would walk ordering just the diversion across XXX

a have to recurrence, patients with I'll curative so couple they they've move actively diagnosed those patients particular high-volume what of right? being And across Are of first a a previously account that So when therapies we you question. so for to cancer what PYLARIFY, a instance, you PYLARIFY? average then monthly treatable then, the consider heard at in consider, untreatable is XXX? analyst So follow-ups. moving prostate the and the the would day, or therapy. And would And rescanned orders, with be

Mary Heino

then Paul question call your your answer to going I'm first. and So second for in

know been the of patients, available have would that to patients. I concept don't think, of There lines I patients. -- of untreatable therapy prostate always cancer designate what for I there that was

and to seen the and an was has of available stage, -- innovation early not be therapeutics, is what that late with think the the patients. extent incredible in previously response it staging then it view we've be patients, the And it or of was of have PSMA has PSMA-based. the also insight on early and an as advance not that true been now, that of a helping much physicians, patient their in been, I role imaging discussion really on that clearer to with

that before. do think, -- Paul It question, to characterize would of of these areas community. But kind and and from I were comes your a the was to imaging, cancer been has to patients prostate that already innovation revelation we're embraced. think what where though treatment I to untreatable back so anecdotally these patient are explaining perspective, being And prior -- in not the that, want hearing, Anthony point that. PSMA the I the all is

treatment, in be they but will how utility what will physician currently most scans we who a that at patient, a patient, treat stop imaging so Our there estimates that for patient to decision whether to is a treatment gift to it's informed imaging to to community. the are assume or that's the And are of prostate per a switch how number begin kind make of what decide community PSMA also often moment good the as treatment. of the cancer science used a the can brings ultimately a think what as I they

Paul Blanchfield

XXX% agree, Mary Anne.

that, to the I right, continues think evolve. practice on medical

per back question, scans able I addressable scans. that number approximately to there. substantiate total any do what allows and can evolution prudent we your significant variability in substantiate institutions large And with we terms is that say customers. those out very customers, not to continue XXX will each that go is we are Anthony, I of we We as What first some ensuring around that, natural of a down in key would that update patient. course put If to understand the doing of specifically be there's I'm break market surveys a to due while going to

piece of XXX PYLARIFY those of -- repeat think share XX% orders, XX%, repeat I of When to that basis. about are I of large meaning accounts, they're XX% it's our accounts on about up that XX% is a willing think data volume. we -- the of customers be would make approximately it's the ordering key of our

year-to-date there, And have a the make but so, if it's you the bit And dispersed, XX% XX:XX XX% up XX% math rule, those then the volume. XX you ordered quarter. can more accounts do the little normal roughly through second roughly more of doses that of than see

job physicians And supply, the and expect team's there not continues believe smaller centers number there drive ample that going math that be still our to the scans terms the are then do there see able can role PYLARIFY the imaging But in country. you institutions. just PET/CT to but to and -- some to to large names you those are referring so -- those and And -- commercial ability there's in across and capacity space the in grow, and of is to our on continue institutional very more to forward. would do accounts large organizations academic to demand more freestanding we educate machines, and from

Anthony Petrone

then here. And a follow-up quick

XXXX, X is on the ARROW quarter. one the patient last first in The

have You follow-up. a X-year

for was one, And readout, in Phase Mary may So on the Anne -- and enrollment on maybe or Phase for we terms look then just man year last just not it -- protocol just maybe timing what in staggered considering thoughts the II next then may had III or last like. that the of Bob.

profile improved, the debt is satisfied more liability flow favorable dramatically the updated and is here the ratio being on and cash but levels, on So M&A. maybe here CVR is just follow-on aggressive all thoughts at so

Mary Heino

[indiscernible] a you're that question stagger So, it's ARROW, data so not that first staggered, when in information the patient around will -- year, coming following was your X. to And patients for ARROW, means enrollment ARROW for you're right, yes, in. the and the

it's about we'd us rapidly Phase needs that So them, radiopharmaceutical somewhat my open now I'm the offering to when same on the to around most to response market readout as to trial, as us the all market's even the would I think and then means protocol of to date the of like publicly is, that in we'd given the that space, in of and a for and right have of for And how III about don't answer what evolving goes potentially, to a what the uniquely as our like leave asset is appropriate so we're of advent and trial, what best more options but evolving. with our radiopharmaceuticals appreciation we'll the again, great meet -- be. III this there I think Phase news market I structure seeing that offer

answering other your think not question, we'll it. I'm I -- commentary kept So sure it offering were you there. think wait -- as offer to I you'll you

we So -- insight for business, thanks us work. to and the does are it We Bob you're great of his thanks great again, our all and set, right, set once into all up.

kind We as also to strategic what a tenets the forward. whatever our are M&A of plan strategic and pursue the structure see as our the meets very capitalization from meets well we -- go -- priorities of set we

Robert Marshall

to The point well our from under improve where I would with I only year thing significant just I cash would at assets And we're a not improve, expect future drive today, think, continue overall even what having remain to yet ourselves to are and as turn as obviously point us to net to continues to and a provides do liquidity do out, half we as can to position just leverage it ending this on long-term the tack on I overextend basis. need we to when we is, company, to ratio that it balances is, find that cash as still mean, that a comes flexibility you net growth. which a conservative capital believe at the structure

very is of to in it's be on, to I disciplined you're and deployment the think continue going spot -- capital. company So its

Operator

We time. thank today's gentlemen, show at you no questions conference. Ladies concludes This further the and participating this for program. in

may a disconnect, day. wonderful and have You now

Lantheus (LNTH) 7 Aug 222022 Q2 Earnings call transcript