ETON - Earnings call transcript Q3 2019 | Eton Pharmaceuticals, Inc.

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Operator

Good afternoon and welcome to the Eton Pharmaceuticals Third Quarter 2019 Financial and Operating Results Conference Call. At this time, all participants are in a listen-only mode.

Following the formal remarks, we will open the call up for your questions. Please be advised that this call is being recorded at the company’s request.

At this time, Id like to turn it over to David Krempa, Vice President of Business Development at Eton Pharmaceuticals. proceed. Please

David Krempa

we Good call. welcome a is This that the operator. quarter Eton’s press available everyone on outlines conference discuss etonpharma.com. XXXX afternoon topics on afternoon, our you, The to and third release today’s website, Thank call. to release plan we issued

is, our CEO; Brynjelsen, and Wilson Joining me Sean on Troutman, call today our our CFO.

the that call involve begin, everyone to from that forward-looking during Please earnings uncertainties in this the our SEC. remind risks results would and statements release see in statements to may risk cause factors like I company’s forward-looking differ Before those the with we these contain actual contained the could and forward-looking and disclaimer made materially statements in statements. filings

turn Sean to will I Brynjelsen, over call the CEO. our Now,

Sean Brynjelsen

like and us everyone Wilson thank today. in the call for the over call review highlights financial turning Troutman to will you with David before for start to on the Thanks, joining who our detail. quarter third results I’d

and major been a expect milestone Biorphen month. our in for was strong the Biorphen the has we have foremost, for available very the product before end a from team. of interest and and accomplishment by hospitals great approval to Eton our customers First product This and product this

of We have call. which placed rest orders our to progress the in stocking and already the pipeline we a make Ill large advancing also continue in to later speak

more Biorphen representatives commercial to Biorphen sales the expect the than Eton and on hospital-focused promoting to representatives XXXX. quarter team of by that updates few actively X team XX expand first has are A launch. currently a who of we

and leaders as key has met physicians and team from we different and directors XXX discussions with Biorphen opinion key conferences well institutions institutions. Since various in pharmacy engaged the over with approval, Etons as at promoted

greater than market greatly strong, and XX this that estimate equivalents per in phenylephrine the current injection been interest has Biorphen product is encouraged year. the And were by the significant we and million

the we unlike in it to expect market has grow significant of phenylephrine to the ready-to-use and convert life. life this product, three-year shelf since available short currently time, Over which addition ready-to-use shelf market expect a a has a share of the

it rooms, allows hospital, due expiry to carts centers locations where and be additional phenylephrine it short throughout products. feasible ready-to-use product the stocked of including Our to in dating crash to previously compounded was not emergency stock the surgical

In and it addition, approval safer our reviewed I or has point FDA reviewed efficacy, by is would for has through not product been gone the are that sense the compounded safety out, FDA products the in process.

Currently, ready-to-use clinical is XXXB into phenylephrine ready-to-use injection for after longer in Biorphen. facilities continue FDA be only is injection a they there formulations. on to availability sell pharmacies. need available compounding FDA the believe to facilities compound no XXXB of would policy phenylephrine breach based the of if guidelines, phenylephrine from And We ready-to-use

give it the non-dilutive million will commercial the to this flexibility of invest that to the in planned launch accretive with of development allows $XX and from pleased transaction also company transaction is Holdings. have debt the additional secured This launch while XXXX. activities, that is us the early pursue us, to in which business Biorphen important and ET-XXX executed Im Secondly, a This SWK. facility week announced Eton debt we announce has SWK to facility

oral lamotrigine our ET-XXX product. thats Thirdly, solution,

has XX% of as we research. the product proof neurologists some with believe will market be Hoduca FDA-approved first this lamotrigine known for favorable it oral our significant impression size marketing after will suspension, and and a on only So first be product

a high-touch program a for successful neurology and activities profitable developing advocacy generating product. that will with KOLs the and pre-launch We are now doing services launch ensure support the and

a PDUFA date a that human support a ET-XXX of review on is XXth. been also lamotrigine approval product our added review. be is the the to human and of and the mitigate in ET-XXX. the that study and will for filing timing. completed March delay initiated FDA under potential to actually were in The factors ongoing assigned January submission is running be The Weve factors expected to has study

discuss like ET-XXX. recently the product update to that Id were Another raised concerns submission. one to partner Sintetica had scheduled address regarding meeting original our is NDA an FDAs is has Etons that FDA options to the our

months to be around doing. compared the were will these concerns coming of concerns were FDAs the exact Eton not in concentration resubmitted believes showstoppers, and regarding what were the and we the NDA product CMC the questions

our then the on And pipeline, fourthly DS-XXX.

we We before still DS-XXX expect the be the encouraged of that end And to resubmit believe by a formation that market for will for company. product the significant that product year. were ANDA

We in revenue-generating that, launches saying, conclude by on I very this turn a year stated, look additional with to and ahead Id be as go previously to So were to of over Wilson, XXXX pipeline. also we will will it company. the product progress forward made like weve had and our we proud

milestone next company becoming to the profit-generating push of a Our is future. in near

that, the results. third quarter with it Wilson, take financial with So away

Wilson Troutman

same Thanks, Research and versus period in million XXXX for Sean. the $X.X expenses quarter for Development third million XXXX. $X.X were of the

licensing XXXX, a that with the in development period. ET-XXX companys the late of costs and to only The offset lamotrigine $X.X in marketing laboratory increase by set to headcount this to product-specific was associated payment operation reduced is acquire the costs was partially up increased along primarily R&D with due rights million facility

same driven headcount, marketing increased XXXX. million expenses with associated General and $X.X the higher launch the from by company activities. public was preparation XXXX product for expenses third $X.X our primarily Administrative employee-related were in million increase The costs quarter of expenses and period versus for

million quarter loss for these Eton reported in marketing of of increases and administrative expenses. our a for as the XXXX XXXX, result a net $X.X $X.X loss versus million same of third and R&D period the of

equivalents cash as cash of and Eton to $XX.X As XXXX. reported million December of $XX.X million XXst, compared September XXth, of

closed ability to Eton for pursue period, end provides with our borrowing SWK quarter development a our agreement growth, capacity support which credit to will Holdings new the on product which future up and acquisitions. million in $XX to Subsequent

we With like call questions. now for your the would to up open that, Operator?

Operator

you. And first Please Thank Andrew with question ahead. Riley is DSilva our FBR. [Operator go from B. Instructions]

Andrew DSilva

for time got Hey, of a questions. and I taking quick couple the thanks

So, transition obviously congrats your you on the had approval you as through commercially product. period a gone pivotal launched

one parent obtaining launching successfully company your and management thing that former an but product said commercially offering thing, yesterday, entirely. up is So and for team really its approval was a another coming

when Are of that points that So Im just realize curious think launch. as there the thinking that about didnt before had data in as last the or early with aware do a should stage about good of you the of models find sense we be or update? an the any the us youll youre space believe pulse you very here provided youre you you of

Sean Brynjelsen

that have that we stronger. would thought demand initial think anything, the has we interest I is been if

you to in significantly. he If our then increased initially as analyzed size, as he market it the to were certain thing, weve talk was and Sales, product gone the Head thought our confidence of has this would into

Andrew DSilva

for the just about standpoint? you as should right with to a little update Could moving from a great us just are Okay, of where I ET-XXX. FDA now thats bit as think an and far reengagement over give timing to that what hear. mean, on you process we

Sean Brynjelsen

to and earlier points questions with sure they in will sent filing, that month Sure. make The it to say, to of wanted filing. theres tele-con that will resubmit those be December this the then meeting agency, later share a agency agency same a page the points this the that addressed, Sintetica on or the FDA us were as list some a in

So through no a process. the coming once believe smooth we should go were resubmitted showstoppers there, in approval anything and there the product and if months its review

Andrew DSilva

good. everything spring you pretty Good, to well. for ramping robust just time me time as Okay. market expect during start be related season the EM-XXX. up question OTC coming then allergy as I about together Last that really comfortable and feeling that Are for

Sean Brynjelsen

you the Certainly This so well unmet as have US may value may anti-allergy the as or meets add market. the prescription as product Ketotifen there. theres really need the drug not doesnt Yeah. it that know, as the in top over-the-counter sense is in is an preservative

I submitted pretty have wouldnt opportunity that, I them, say before know success, this to market be they a product be its think the and will end the that the amendment believe I and we can covered much product too physician finalized for marketing the partner. well. partner of has our I that that month. they overall an Bausch, to on really amendment its I for essentially would expect comment an is important outstanding

Andrew DSilva

the do good a and progress Okay, much in may quarters. Perfect. all you timeline great. congrats Thank then. you Thats very on

Sean Brynjelsen

welcome. Youre

Operator

Raghuram Selvaraju from our Thank question H.C. you. is And next with Wainwright.

line is open. Your

Edward Marks

you questions. Good This Ram. on afternoon. Marks the for Edward Thank taking is for

in of Biorphen. for the terms Just rollout

You of quickly that details with in those are other and expect withdraw the would Biorphen products whether provided the carts to the all a hospitals in lot replace you competing how Im themselves wondering hospital and to have everything just immediately Biorphen? and thats

Sean Brynjelsen

question. good Its

orders, in better to say belt, next we got on of to we days shipping I large our months rise the answer call XX hand I think the will under prepare so initial its something warehouses. or and already expect next as inventory we have as begin be couple our orders in in a our

to switch having to report the thats safety them that think life to reviewed potency. when of for you the own the switch FDAs just think I want shows efficacy not on is the see shelf Its been hospitals wrong just especially using hospital important, the product of amount fact will compounded I for the hospitals of any XX% matter a and product have theyre important benefits, the

to me especially ready-to-use same choose we would or what product more theyre buying. the So strange to be do see less compounded currently in product quite when is price FDA to this it using substitute ranges that, approved not idea product of for and the the with a that a hospital

believe we conversion be will the So quick. process

Edward Marks

Understood, good points.

some coming ET-XXX Moving DS-XXX, milestones just to with those because here. on are and up

the completing only and any that completed submitted DS-XXX, are then human factors sure before the there date that before on March requiring the to it year? items study making be the that other PDUFA of aspect Just need the is end youre by

Sean Brynjelsen

DS-XXX. Ill start with

ANDA the essentially is DS-XXX, complete. So

are that weeks. compiled. handling work that paper along datas submitted all just next to the be in few The were goes are with expected some We and

the certain somebody to the feel and asking the Lamotrigine, weve they is that the it. really implement the of we is feedback thats what that and see users can can and the package primary like them and received this point follow demonstrate really to at its instructions there parents to follow those is encouraging study FDA what telling so do the product instructions without

this clear is that we will an request its believe factors confident common the instructions feel drug unusual user human request, study not and very new We outcome for positive products. the a a a for have

Edward Marks

Right, question. final right. And my strategy question quick commercialization overall just

or Just if the there submitted XXXX just dice was of wondering being kind for any if how was it fell? asset prioritization in

Sean Brynjelsen

So and take question. maybe Ill this

Now as that we try how We to just the dice fell. quickly can. file as every product was

certain have So here filings we prioritizing a at handle were products can multi not team once. planning and that

get every as we quickly will So product filed as can.

Edward Marks

appreciate the for thats Okay, me. details. all all I

Sean Brynjelsen

Youre welcome.

Operator

Lake Thank with Capital. our Takkinen you. And go next Frank Please ahead. from question is Street

Frank Takkinen

guys. my Hey, for Thanks taking questions.

for product one start What filled the you done on left think when actual the end on be the could the before accounted that be needs you Biorphens orders and be ready to will hard how do of fast quarter? first and get to market end of Just to all is at commercialization. November the

if And that possibly about that so full thinking having product, just talked if the year a are was commercialization as correct, about curious million possible? just units first was I Im Im think if in this something that you that with then maybe something you of still

Sean Brynjelsen

are on or say units not I the if is you to want outfields available think there we chase, XX Were for believe providing sales, term. use us guidance what I to product that, million can

as a on belt, far expect been in around if quarter but different looking our with after portion past, have it, we little scenarios well significant provide color on hard So a be as take at more have a this bit I of to to we might think a the number I that. that, able is working Im

hand, expect have we of in well believe orders product shipping that. think do week before We we were saying first have start orders I the to December, do inventory significant

capturing revenue would us I see in So December.

Frank Takkinen

beginning reps then, can your Do the by launching reps advance the XX said And on about end the reps this on neruo-specific then year sales thinking quarter end sales X. in force, to lamo? plan of X XXXX plans you of of and or product of to when additional reps X of start you couple bring you have neuro at quarter hospital to those Great. and next get to side use some of one a the by quarter the extra youd

Sean Brynjelsen

have to as areas, go So team. throughout sales to each well its both product sell because or for If will we can own to leverage team sales as cross do likely separate lets that. to directors institution the an have will pharmacy two example, different neurologist say its

folks Biorphen. already, have do selling We X in place actively

an have the well We filed increase X year. sales and of of inside expect that before as sales team we as our the to end

other For what the and clarity that The is SG&A. our look that. or will And sales the marketing well obviously minimized putting the additional associated on lamotrigine, together process on were cost approach with like. costs thought provide

whatever it model, rather than that a sales possible is, rather as validated largest that can we the going different with increase team the that, sales and that force in the the of team part validate size then sales sales territories. conversion in a expand one team the size of process validate size sales And Id put weve

Frank Takkinen

Great. any on have front guys update then just question? be do and my final from development would business that you And me, lastly the

Sean Brynjelsen

because around are of and the a us key on not bidders opportunities, other that, stage later a suppose looking say, always for on couple know these lets I turn in the mix business how it. say discussions discussions is never be built you can development ultimately at We will licensing is company products, could you competency theres out, our

that the But XXX already meaningful that There well look really transactions late-stage pharmaceutical at can say thats look did either look were more what require lets and relatively year pharmaceutical with something at manage midsized of we small lamotrigine, that a out something no and from assets small to we therell filed within sales and we is can that plenty than assets a looking X types assets force we are have year months at a patent as and goal different protection, or our and per filed are company. so. there approximately have deals be at products something be IP XX

Frank Takkinen

Thanks Great. questions. my for taking

Sean Brynjelsen

Youre welcome.

Operator

more Thank you. And questions. gentlemen, no I’m showing

Sean Brynjelsen

Great. can Well, relations. either call you for thoughts our look always reach next call everyone out to any thank the forward or today. or to myself I you and to investor joining our questions

Operator

This call. thank that, with participating. Thank concludes you conference And you for ladies gentlemen. today’s and

disconnect. now may You

Eton Pharmaceuticals (ETON) 14 Nov 192019 Q3 Earnings call transcript