OSMT - Earnings call transcript Q3 2019

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Osmotica Third Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. [Operator Instructions]

I would now like to hand the conference over to your speaker today, Lisa Wilson, Investor Relations at Osmotica Pharmaceuticals. ma'am. ahead, go Please

Lisa Wilson

Executive Welcome Einhorn. This Pharmaceuticals Relations is on Chief Osmotica's With Operator. Officer, Chief business Schaub; JD for quarter update me and Chief are call call. Lisa Officer, today's Brian to you, Markison; third Operating Andrew Osmotica Financial XXXX Osmotica. Officer, Thank Wilson, Investor

this of months XX, XXXX of yesterday The company detailing can release a September press call press financial results and the osmotica.com. through ended section close market. accessed issued a for This release the Web the three the of be after site webcast Investor at Osmotica

regarding Before made statements future company's like may on we to Securities and a defined be would call performance statements Act. considered Reform conference Private intent any express that the that forecast, future get today's projection, I Litigation belief, by the remind statements started, as forward-looking expectation, everyone or anticipation

on of noted those forward-looking risks to SEC. statements specifically available any Osmotica's performance. these call are Web at will statements. or XX on are forward-looking in materially for disclaims Such days law. update projected yesterday's forward-looking press as osmotica.com. in as uncertainties, based and filings our forward-looking release may of and site statements obligation management with These Actual future webcast Osmotica to required guarantees except our of this differ involve intent the information statements, including and not by today, from results archived the The be available those

was held XX, on replay may listening the call archived of XXXX. or webcast, November who benefit this recorded those be the For and to

please the press most SEC recent releases announcements discussed, Since then, related the company's to topics Osmotica reference filings. and so made have may

over that, to with Osmotica's Markison. CEO, the call Brian turn And I'll

Brian Markison

for call. Food or acquired for investigational on known were more you, notably, the as Lisa. droopy on In Administration, very and with acceptance track application we year. treatment submitted fronts, we're quarter engaged the with fourth of this drug we blepharoptosis are U.S. Drug and the eye. many the the the communications morning, our to product September, and in joining I'm RVL-XXXX we productive and of new making for pleased an progress thank the you most FDA, file to Good believe everyone, Thank around for commonly RVL in

momentum, potential to remain outreach confident of Our enlist outside our great U.S. and effort. ability in up the partner through picked has partners a this to we

and positive. feedback eye to for Phase recent strategy We build our progress out with plans. conferences, to preparation progress weeks, turning look our safety the all with the messaging opportunity we activity. care of focus and efficacy In we've our medical from X planning several these in forward education to has pre-launch and present KOLs as RVL, sharing for you been had global data to RVL and unanimously now We're

clinical Looking next or year. sclerosis. neuroscience ahead had treatment first-half multiple to that we plan to the associated productive arbaclofen results submit promising feedback arbaclofen therapy program, release late-stage spasticity our have of the remain regard amendment we in with on for trials, to the FDA the tablets Based extended our to from with NDA of recently our an from confident

meaningful data utility about relief excited evidence strongly set Our of trial MS the most clinical divided arbaclofen can the We're presents bring doses. from clinical the suffering largest, Spasticity arbaclofen potential release, of and and two release program believe in extended arbaclofen the to patients in The ER development robust spasticity. MS it world. demonstrates extended in efficacy

and us also pipeline our launches to particularly promising scale expertise month. will of support of welcomed DeBiasi existing last We guide consumer Board help infrastructure our recently Michael Directors to we products. perspectives as our commercial in Mike's

late-stage on our pipeline focus to plan track. company continue we promoted on The and to firmly transition advancing products. strong, pharma a our are and remains to our supporting specialty plans, financials Our executing company's strategic

over turn to who Andy? our to company's in who followed will products the discuss Chief will like be I'd JD Andrew Operating Now, discuss results. the Einhorn, Officer, by the Schaub, call He more promoted company's will detail. financial

Andrew Einhorn

you, Thank $X.X $XX.X months decreased to XXXX. product the were for ended September for for XX, XX, to months three the XXXX, the three million months revenues million, $XX.X as compared Total three the XX, million Brian. XXXX, ended XX, XXXX. compared months $XX.X Net September three September to million for $XX sales ended million September ended by

related the lower ER Net entering tablets offset during realized reserves due to sales estimated higher methylphenidate than decreased selling the lower the net favorably based higher selling on due to quarter sales Methylphenidate with increased venlafaxine significantly product net as market, actual by were sales and of experience. ER, of including in estimated to product venlafaxine by Net prices than during partially of combined result adjustments XX% XX% a product the primarily and net during product quarter, additional prices lower the volumes. of returns returns resulting approximately $XX.X returns. in returns aggregate, quarter million competitors M-XX, volumes, impacted

if any, years. additional for remainder from reserves, in negatively adjustments affect product future methylphenidate these product to during remainder adjustments, and any, future of in recur XXXX will both that XXXX and generic not competition Favorability additional current of the approvals if years. other and and and in venlafaxine in as launches well arising may products the sales from returns, continue of expect competitors the We as future, to

being and to severance months in with a sales force force associated Osmolex headcount compensation increase three as general three $XX.X of and the XX, Selling, higher share associated associated reflects expenses to third marketing costs during first the company. September to expenses with addition launch our quarter increased public quarter XXXX, in the sales together of million and costs the September with and XXXX. and administrative ER $X.X realignment of XXXX, XXXX, expense general selling, with costs in The million, ended million the our during compared administrative months ended $XX.X XX,

Research our million months the cost ended $XX X XXXX. and offset and ER first of in as manufacturing share XX, XXXX, XXXX, three the $X.X development months for September batches reflects by three costs September XX, of million $X.X to period XX, not partially compensation during trial expense, in of Phase Osmolex development clinical compared three-month arbaclofen by The completion quarter ended the the were XXXX. the expenses to XXXX, decreased of the million decrease which present in September ended in

competing compared During loss quarter for value to resulting due of was quarter quarter million, $X.X million million to XXXX of EBITDA the products. in Adjusted the XXXX. the adjusted million $XXX.X quarter charges to impairment third the a fair to $XXX.X compared the price of third EBITDA XXXX. $XX.X asset third generic $XX.X was for XXXX write-down Net intangible third of quarter, of methylphenidate volume million of decreases, net from the of to recognized loss related were and in of

net at please end For the of the press release. our income tables or loss, adjusted a of reconciliation to see EBITDA

and September Osmotica revolver equivalents million. of $XX cash As availability million, XX, XXXX, of had borrowing and of the under cash $XX

of deferred We $XXX.X had financing debt of fees. net million, also

the I like to Now, JD. call turn over to would

JD Schaub

to Divigel and continue Thanks, see Andy. brands quarter, ER. M-XX we Osmolex our key the third promoted trends solid In from prescription

foundation and of Field maintaining which to team M-XX has to larger products if will our in next we unified serving We full Importantly, Divigel. Osmolex a targets our us and the with behind key in also structure promotional later we efforts significantly allowed field third year. from national while realignment quarter while October. This during efforts completed this of the Sales a set drive promotion key growth, expand to realigned and support RVL plan launch believe continued approved began

QX of down the as X% plus prescriptions. modest pressure. was while by this Total which same outperformed the last Specific growth roughly a prescriptions quarterly M-XX quarter XXX% have versus to period down versus result year. in robust key continued over sequential XXXX X% was X.X%, brands, market Divigel XX% its XXXX. showing the M-XX growth year, seasonal quarter-over-quarter about increased same a

least health Access to on September, comparing a prescriptions of increased one When unique Osmolex prescriptions. Moving total or total for X,XXX since our QX, through in programs patient total enrolled QX XXX care launch, wrote at providers XX%. Osmolex, to

have nine expanded promotional year, further adoption beginning fourth Osmolex for believe footprint in quarter our and the this and ER. months that As will experience we first awareness the over prescriber accelerate grown prescription growth

dosing see continue flexible adult The reactions. through drug-induced therapy. Osmolex We good to Access with well Parkinson's to support a combined ability meaningful to is the as a overall Osmolex, product patients technology suffering once release and options their of as for and option access strong trial the extrapyramidal begin continue and disease strong physicians from Osmotic driver treatment ER patients sample once-a-day persistence as

legacy have business. in segment believe dynamic to built persist, We business continues Trigen competitive will our our briefly to support non-promoted and continue in and partners, important methylphenidate generics, on with despite VERT. ER notably will we be investments our position a the strong ongoing manufacturing key increased and competitive the dynamics, the from contributor products, this supply our Touching osmotic quality to an our platform channel key with in contributions commitment however, this anticipate

we're focus existing RVL. for from while planning advance continuing growth brands, strategic Lastly, also launch on to we our

across including and discussions progress a and opportunity all Phase bring eye Meetings, presence as overwhelmingly We to optometry, positive. encouraged highlighting review. remain we Scientific shared, to X with meaningful poster As We product our ophthalmology, by to podium Care live we Fall oculoplastics, first-in-class look previously forward we specialties, been have than data. and the including which updates ongoing XX of the NDA more Eye potential a through highly had KOLs had at presentations clinical market,

like back to call Brian to remarks. for With I'd that, the closing turn

Brian Markison

forward with over time turn the in update Operator? And future. the the call I'd to We near to our operator this that, for progress for to back morning. you JD. questions, thank And look Thanks, continuing you like on your to

Operator

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

Your line open. is now

Ashley Ryu

This is morning. Ashley good on for Hi, Ryu Randall.

now sales been mentioned about little So can has product? RVL more commercial force recent realignment. guys for a the You talk you preparations submitted, the bit that a

do launch that, marketing outreach? little need how DTC [indiscernible], the and for out, about doc do that your build bit Following [ph] you how talk a just initial kind commercial of you to for and you add plans about reps think many can

Brian Markison

presentations, a this off study, year. occurred very finish ourselves of the already answer. let a basically and start commercial that comparative those didn't extremely most those From a extended second pivoted, lot we point, Hi, it's were I and X thanks. also KOLs. presence and completed, build have true off question, submitted all obviously And of Brian. and the results, Phase mentioned we our we and conversations then outreach started poster safety of and Great medical had of Really after the We with start the in until we podium have I'll NDA. that trial pleased and the in as making remarks, JD to out lot it the known we gone well. them medical with had time, conferences at great prepared and

again our base, the and publication with it'll scientific symposia awareness, prescribing out On more and focus and on build then focus for ophthalmology will little preparation core, a and top commercial which begin is optometry. now, that carefully the we

you to take it from JD, So, want there?

JD Schaub

Sure.

throughout at medical one a care that of that through I interactions doses, education Congress to has condition planning with a scientific and work and the side, Ashley, in education, fair up ongoing it Fall and disease, doing to is been think reiterate way there outreach the awareness foundation, terms and the KOL because to unmet the getting There on that commercial a kind foundation building initial and the look, being Schedule, and the and of eye and Brian's where Eye out I pure is Care think, the amount So continue professional obviously gate the leading large point need to is level. the do would right around we're of grow, I building needs publications, education. the

and see out you'll just think I the us through of there, head So, the continued work be that emphasis in as as well. and not end Eye terms of streams internal focus year Care into XXXX, an this a area that that Conferences, that'll but we

at this had On of the as is lot care interactions of might the there far, a enthusiasm, specialties. know, you we've you imagine when we look all across eye commercial and market thus side,

of So, them or comprehensive general range treatment unique with interest will surgical all be of optometrists, ophthalmologists, whether a if we're talking a oculoplastics, first-in-class approved. what ultimately specialties, to a have in

we front the so, utilization force to up need what and the effort a okay, think field perspective. work is And I type of with now understanding, do who from that, get drivers of are there

that as required, function today growth I once don't I in have foundation a footprint place comfortable would footprint RVL any beyond think that just is field serving the think build very trajectory and be launch. ultimate of that the commercialized. meaningful going for any be we're of and the the we to with growth of

Brian Markison

Right, prevalence third very We're to fourth and and footprint the now annual marketing, know quarter at office. high in initially exam, Ashley, beginning concerned And perfectly we about year, the we this at restructured of ptosis, up match market. influence which the -- U.S. that always this not the to is sales for too given half year, begin expand a them an and digital our quarter and major the prescribers high presence, know least of of team the of and third prep ophthalmology really this and have designed we quarter population into patients what to we're of coming with optometry. can going in eye now the again, the go

unanimously similar, that trials, refer for and to have an condition. this other or our they preparation more said help digital So, to this their component we might us opportunity mild want been direct members maybe this our that would lot will they physician to the patients had self-referral, patient clinical family test to and audience, needed that of upon friends had to the when talk a with will in the a staged, product because see and albeit, household we other uptake is based be with core we consumer that

So, the probably we and will staged, uptake the core DTC monitor will be occur after group. with physician

Ashley Ryu

can one more a little Got that talk of [ph] the submitting the in does work you're entail? it, I kind arbaclofen, thank more, bit further what then just first-half, you. that And you mean on

JD Schaub

be receive long-term the safety together. really recently outstanding all going is milligram trial clinic. agency. one should we and coming be and data yet strength. The rather will None process, work last finish consider of putting We the amendment to that and to our soon our good We're to NDA. a in the then thoughtful patient is to the in that already what cleaned, from and did is very for this robust The as as advice be we would completed is XX that month, existing looking make that

We So, totality excited next we believe we're evidence are in about the persuasive, quite of and enthused on about the the submit program. first-half to that track is the of very year. program. We're

Ashley Ryu

Great, so thanks much.

Operator

And Securities. Instructions] Jacob [Operator you. Thank of Fargo question next comes Wells Hughes from our

Your line is now open.

Jacob Hughes

Hey, some for out color you mean, outlook on do started drop guys. Can to you the that think I good additional morning, provide here? methylphenidate?

Brian Markison

way are Well, at very is strong and mature look it. to markets being attractive, right the the troughing that

think I could JD color. more give you

JD Schaub

Yes, sure. Good morning.

obviously in customer competition comments, has increased. we're So of I The markets well-positioned prepared I think of this; in think a our those terms in I earlier base. to both alluded

and that's is a I some the again, particularly competition but going whatever the to in to a of importance prepared existing and any value, that looks see like. something customer like like, knows are we're supply in also, we able but base, in the given persist that good sustain that to think we I meth we if volume markets, large markets, us we're key are place, erosion, where believe comfortable price set the expect think for, with additional I continue that through be generic venlafaxine, ER competitive market think those we strategically to expected, and

Jacob Hughes

where that of anything the And -- say U.S. on level there the work the partnership then would and interest for be? Okay. outside geographically, and can is you Brian,

Brian Markison

I back call the Conferences. of out morning interest. we in this the lot Medical the Yes, particularly literally just Nick We've is and robust reason JD see Japan, is and and fact, just we our companies at got from exposure us now, to where reaching around generated a had

our those try the We're of now not suffering we're partners best So, right to outreach. lack to going from pick geographies. for

that problem the those we pick partner, be know it process make partner that not more to having we've sure a far our sure but territories have, biggest right through is can and will Our making actually time consolidate been for in reception trying a It's problem optimize and right the we the value a very a encouraging. for partner thus us. have but franchise, of that taking has the we matter

Jacob Hughes

Okay, thank you very much.

Brian Markison

Jacob. Thanks,

Operator

like Brian back Thank for call ladies conclude over would to I does turn now you. session. question-and-answer And and to gentlemen, closing Markison any remarks. the this our

Brian Markison

Thanks, and submission think call, you. as the built RVL, forward and clearly core of about Operator, our our arbaclofen, for through base our we've and progress comes business call. final. our all we excited with updating the listening I with in everybody and on you plans that in thanks to make look and We're on that Thank for also participating we Bye.

Operator

today's Ladies concludes for call. this conference Thank and gentlemen, you participating.

now disconnect. You may

RVL Pharmaceuticals (RVLPQ) 15 Nov 192019 Q3 Earnings call transcript