ASRT - Earnings call transcript Q3 2021

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Operator

Good afternoon and welcome to the Assertio Holdings, Inc.

Third Quarter 2021 Financial Results Conference Call. All participants will be in a listen-only mode. [Operator Instructions]. I would now like to turn the conference over to Max Nemmers, Head, Investor Relations and Administration. Max. ahead, go Please

Max Nemmers

is Officer; afternoon and today’s will encourage discuss President After Executive you important who financial Assertio’s for to results. provide covering that, and financial at With presentation questions. and this news Good and page accompanying the the President Paul, us our are the me to of open results. for of review review followed today release website business call and Dan period your Schwichtenberg, Peisert, for Dan earnings to third Paul we Chief I our it’s available discussion. and you. on today all Investor remarks would an thank investor.assertiotx.com. Officer. will joining Vice overview The our now you the will by Senior Thank as Chief quarter Financial the open release XXXX the

regarding this in call, performance. and will and statements make including Such involve projections During forward-looking management not noted of the those and report future our press uncertainties, Factors forward-looking risks sections well as performance Assertio’s future in and this other are guarantees statements and filings section afternoon’s on annual risks Form are release XX-K. of fully described the our SEC. other more with as These Risk other

required specifically as Our to Dan. actual except over intent any disclaims or now Assertio law. the results forward-looking turn obligation I And statements will may differ update call statements. materially in from With those Dan? forward-looking the to those that, projected by

Dan Peisert

my Assertio. fourth joining everyone us with to afternoon. this September Welcome Max. marked This Thanks, anniversary

products, where that from In me, of location investor everywhere had XXXX, look back debt and million as ticker restructured the on is the our headquarters, of times. to that people, positive times. get of our debt September and debt today. and of to of largely September principal of two the struck we holders of $XX.X We change, change, we operating quarters that leverage leverage asset this we’ve had highest number balance tremendous it’s of over name reflected X.X the $XXX X.X EBITDA us you company our sheet. since portfolio repaid of symbol, been just As This net and our settlements, and cash company quarter’s sales year interest. its the our and the of for time million and by funded one million In we’ve times I legal we of we in $XXX flow to XXXX, are measured debt and base four we And flow Today, restructuring both divested consecutive cash EBITDA NUCYNTA. complete. period, is it’s adjusted reported thing

in able and a we’ve especially proud do in. We’re accomplished to timeframe, what been we’ve incredibly it of condensed

forward, Going funding. debt external need our from doesn’t of sources service to these come

We’re generating operations of business. that the cash the from

towards We enough and runway debt that investment maturity growth. into business to have development, a

quarterly on year demonstrating portfolio. resilience the Our the far have also so this of a consistent revenues been basis,

incurred litigation above come considerably the initial $XX.X charge short now for of despite months way time. quarter. last This is guidance improve seeing full-year to EBITDA guidance forward-looking in year adjusted we’re in just INDOCIN end adjusted we’re well. our the in to million fruit, a continues bear exceeding high it long in now as above and making promotional that As We’ve expect see We now our reflected our exceeding the our $XX ago, our results range six we gave a mature quarterly original the model just non-personal being it’s our our and come short and million we EBITDA $XXX investments and show an revenues million.

factor quarter early portion is federal New the in the and antitrust claims you operating Our The court final it The reflects of million impressive still brought resolve cash Year. class payments the Humana cash Glumetza on results claims that opt-out matter. flow the of $X our more are track. this pending court in plaintiffs when being are state by to approval, much final will belief and is our in slower remain but that ongoing a even become

including others them these opportunity remedies arises. to favorable available will pursue claims terms on desire same exhausted, when with will We And the once continue be all dismissal. our to legal resolve to are those the the us, as

a resolve Having we’re will and both $X.X also we well which – it be by these matters addition, as class future, the suits. behind charge litigation, significant against insurer. of last covered on our is also frees matters to were derivative our we’ve The related management business. In focus that action disclosing total ongoing quarter. to cases $XXX,XXX and a these reducing achievement net for to up as its positioning us. us took time And business the securities agreement is the but legal settlement costs operating in into These entered be for the million, the for the

for. being recorded the So proceeds. this is insurance only of benefit they additional were quarter item fully the The reserved

very future versus of tailored and has live platform Cove and prescriptions receive On resources months engage and on in patients We meaningful it for going ours that with worked I’m the a this our CAMBIA their just the them of is CAMBIA with side, we’ve to SPRIX. set for and broader patients that a and drivers think is part physicians of be the how with quarter new now telemedicine during yesterday. their commercial expanded CAMBIA Cove excited a niche time. DTC for been with SPRIX. gone to offered XX interact customer both alliance about build that to has both What’s a

claims the we’re seeing making improvements in share prescription remained most just As great telemedicine through first And data total only convenient just has every many as what in the is recently. from result the pandemic results. increase days, of the these that early such in The showed day the rapid user-friendly. held. hope and evidence, of recent by has a steady IQVIA made of claims the relationships, the we Cove is platforms them more are being

for quarter, year-over-year in sales XXX%, XX% alone SPRIX thousands launched our door already volume well. practices, and late seen today, our of proportion is small our up off SPRIX we growth we’ve small and In physician growing a with the getting but Cove. CAMBIA largest prescriptions prescription were Cove active patients the we a of platform. of despite in quarter resources. of historically still as can the it’s dollar our base, at And this terms, had This detailing revenue for but to Cove reflective tens first growth overall Cove of today has which some focused rapidly, achieve it’s through

pain and Another CAMBIA county with that – other is treatments in physicians the for likely they country means. live detailed Cove’s the a in familiar physician the otherwise unique XX% also primary SPRIX. we patients your we of had don’t on promotional have aspect or in overly care who’s the But innovative a access past, consult wouldn’t and specialist have headache might single wouldn’t not patients to migraine have and

insurance is pay our expands patients platform XXXX, truly for coverage So with migraine Cove cash are is Cove the for market, in health in market for reach. offering with the to insurance. contracting health this currently care Today commercial offer plans

add we’ll add to able for they’re to As capabilities, seeking patients able these insurance offerings be additional coverage.

to more and us to to now. we the recently this a is a is the do development growth. There’s affords been SPRIX SPRIX. great priority, development, lot direction the return a exciting step this first a but of work still the has with it to opportunity terms right in have Another regional always Business of so contract into franchise network, large integrate just finalized a IDN for SPRIX

external we’re In do addition engaged many and a and Science internal acquisitions. the the in to asset financial combination We’ve yielded Back completing process, to as resources us comprehensive Bay making which we’ve side bringing In completed attractive own Life that well. sure the with opportunities. identifying resources evaluation to our Advisors we’re screening and bear having efforts, also BD, right to buy aid

Our platform Back fit acquire a products intend million towards goals XXXX. have at execution $XX by least with still changed to to our We now have of our generate product transaction. Bay, profit that to we Together with not can business gross roadmap. development and attention in within respect a turned

Now, I’ll walk turn who will Paul, call over the results. quarterly to through the

Paul Schwichtenberg

I in website that three X, Thank will of available afternoon net decline prior is the lower the will for sales you, months third sales $XX.X Dan. Starting and year XX, the SPRIX This $XX.X $XX discontinued prior million million I compared net the reference notably on XXXX. in ended Slide product brands quarter. our results. September driven product and our last The SoluMatrix. on from sales of discuss XXXX, year quarter are are versus as highlights were by the There quarter with volume quarter I review slides financial to million

previous in over quarters, million prior has change. by the impacted by been increased commercial sales net quarter. SPRIX third in the volume INDOCIN year mentioned the coverage $X.X As quarter prior

price distribution prior second adjustment XX-Q will X.X% profitability X% reminder, versus specific a to of the sales the change quarter, of due the net quarter portfolio level in for information. the refer a on for a loss strategy down the versus As net portfolio in $XXX,XXX Overall our mix future. quarter increased quarter, product third Also inventory the drive that adjusted million prior remainder unfavorable quarter. the Slide up second related the sales $XX.X reflected Net sales the to was primarily were for to EBITDA X compared quarter. a to channel during in are one-time please

than EBITDA was sequential excluding As ended the full of the impacted of reserve, over year a $X.X for is reminder, growth in quarter the million, was and represents the XXXX impact September increase which legal EBITDA $XX.X Adjusted EBITDA the quarter nine second a reported million XXXX. an XX, for higher months third XXX% prior legal year the the by million $XX quarter. matters, second quarter

of and we As across our our shifted restructuring focused we products. business model, executed have profitability on have plan all our

gross our impact As to step margin result, acquisition. excluding related inventory portfolio Zyla of the up amortization the a profit

margins XX, three an an A For because XXXX unprofitable. in significantly months ended large was of XXXX in sales, same improvement It reflected to versus discontinue year-over-year the period margins QX which due is September basis in SoluMatrix XXXX. the the the lower XXXX versus to points was intent XX.X% reflecting decline of XX% increase our QX was this results. driver carried it and XXX SoluMatrix

the in However, to decrease XX% legal able of million expenses the second million $XX.X in $XX.X at includes the $XX remaining were legal expenses quarter a and XXXX, the expected higher XXXX. quarter, X, second $XX.X sell $X.X million alternate identify $XX rate our third million. ultimately based $XXX,XXX half This annual second to administrative adjusted or on selling, inventory than operating adjustments. reflect in Slide savings greater expenses, of adjusted on insurance million, we represents margin. an legal In savings versus quarter a cost from a reserve the which versus in general in million beginning million the we XX% which benefit channels of achieve annualized of were reflects and which $X.X to operating This operating of excluding a reduction run Summarized expenses includes a XXXX.

Now that we we’re exceed cost confirming the complete to once targeted savings. that again, our is restructuring expect

June the Slide million, operating a third of on Also reserve million XXXX. generated of was loss the Absent the XXXX. senior XX, during was Net million to today we second of flow in September balance Net million on million $XX.X principal XXXX, mature made the $XX.X on flows As consecutive as for attributable is of the XXXX. savings of ending second X of $X.X fair paid would quarter and statement which settlements from of $X as paid net on XXXX X have November payments XXXX cash was million. a and September higher of call, On XX, QX not debt change debt by interest flow the increased X, operating reported to QX million. secured $X.X Slide quarter. balance our of quarter $X.X cash balance the are until reflecting was cost the result partially The in the legal company million remaining $XX.X million On will amounts the the since the compared value quarter by the guidance prior by scheduled million. loss positive XX, business, settlements by million. million, $X.X The quarter $XX.X consideration. provided activities September quarter impacted in for operating revenue, our $XX.X net contingent primarily XXXX shown the $X.X $XX.X for the legal legal stated second cash offset increase our ended is was increasing cash XX, was income the for of the as cash highest during cash of in quarter of by $XX.X quarter and of million company’s cash of EBITDA

inventory large been QX to Looking refund into anticipating will operating to cash other in interest processing. flows the has to be it delayed an purchases. continues cash such in million, been flows the timing the fluctuate. as of senior will QX we working XXXX, XXXX, timing due but because due capital refund flow we QX, and our If expect to cash income payment interest which be have of debt operating secured and delayed $X.X quarterly the of tax positive, are this payments, basis, tax IRS there annual to On and outflows impact and

greater Lastly, greater results platform $XXX than again, a the versus and than and our summarize million, Slide third of previous Overall the reflecting is our once through quarter for very on annual results. X with XXXX revenue EBITDA, refined quarter response favorable net we’re actual pleased the as million savings Adjusted updated to Product XXXX. commercial follows. cost $XX sales a expectations. higher reflecting guidance

our flow. the on lower revenue product positive continue and expenses cash We to and of EBITDA see impact portfolio

behind beyond sustainable now, restructuring that and turn long-term we platform I’ll is build to us to we’ve and call Now savings expect the position on growth. our expense in our targeted focus and to now Max. XXXX is Assertio And back achieve created for our over the

Max Nemmers

could Thanks Q&A Paul. we please? the start Maxine, process,

Operator

comes from Partners. first Henry [Operator Instructions] Roth question from Capital Our Scott

Your line is now open.

Scott Henry

I here. It and was the talk could comments the SPRIX as some afternoon in find about, when upside? the really guess congratulations, and that, XX-Q the Thank are pretty sounds you product maybe strong Dan, expect like did I perhaps Good and first, well? the a you. should questions. profile drove results have I couple on of absence how any trends doing what products strong, in but CAMBIA to

Dan Peisert

with We anything have should be XX-Q this hasn’t it Paul, it, I’ll filed commentary you been, if and The already filed saw it if afternoon. but will have start be specific.

And INDOCIN Been this the expected, to last of move as does year, than had else? lined better and queue, it’s individual it’s than the expected upwards in expectations, we been did, anything CAMBIA has in stronger see You’ll continuing do how SPRIX originally don’t relative but as see products to think but little anticipated. driver well bit big up we ours, We in be them to perform relative line throughout your I in and them roughly what been performed this have I the strength quarters. quarter. of to Paul guidance a with to they continue couple all the a

Paul Schwichtenberg

first say mentioned in I back I we were model comments, numbers off, mean, change bounced my the as I as higher, would in QX. INDOCIN obviously that after that Yes, distribution

also non-promoted just saw some some would price in And variances. our quarter-over-quarter of bit, We but say with little products. CAMBIA a volume mix expectations, line and due down some SPRIX higher just were that to in I

Scott Henry

us really services, of mostly audited channels your provide that those look prescription Okay. distribution that for you given or And different think do is they Dan, prescription, noise? value at any

Dan Peisert

SPRIX never in things. in to is started And whether services is and report would not who historically that you or Then like anything. in Scott. it’s as included to IQVIA hard for of One been they it channel had and show be to like just Symphony. some changes just, It terms There’s distribution it noise.

services. hard volume judge trends audited the looking it’s to underlying by So those at

Scott Henry

Okay. litigation or left That’s could of insurance out chance I wanted for settlement, the then to of confirm legal the And lines? that have of magnitude what be speak out of is I to front pocket as kind expect, any what would to there you Glumetza the that and that. paid product on there is well, across does but

Dan Peisert

for isn’t has been the escrow it’s for has in insurance the question finalization coverage case plaintiffs the in that case put of that been Scott, – decision. already, and paid, Glumetza Thanks there any one of the cash in put pending class

The of have we other litigation is remaining litigation this litigation in point general broad piece that that’s outstanding. at swept remaining large just we’ve opioid been the last in, the that up

Scott Henry

then the I of be, seems increasing trend out final which a like the to non-face-to-face marketing, an or there. you’ve question momentum, on lot you be And got Okay, edge tends it’s to great. of seem this front guess it this great

So, you It’d some more that How mover can leverage be but I’m them, some has you urgency leverage to first in the advantage. it is obviously acquire what assets probably near And looking for you. have working? to to you get are term, across model this to confident seems be great sense the products. business a your that of a just trying been. Thank to try progress you’re how

Dan Peisert

we Appreciate the edge the think we And Scott. do Thanks, of that are this. comments. on leading

shaking We’re this that’s limited, we would prepared other just to see something will beyond and was has more access more already say, trees certainly would I that will you’re more goes that more to my that limited On gone I’m a we’re that would, put to already physician lot more advantage. in-person, to are all maker, but a comments as especially to non-promotional of we’ve and encouraged aggressive permanently having this, their companies behind is identifying competitive at products We’ve started offices in sustainable the we and them gambling this good right, getting leverage gone model supplement as career and those and something And more and it and when be And on we and companies screening. doing it’s why close. not opportunities time do see going a as I’m being I that something We’ve I that that pivot of you’re like done. on. conversations begun deals using do have probably our by access We outreach. the a not one of that good very odds would a right. has peers been and those see also in. very now of

when very favorable make but transactions won’t being on some they’ll a outlook predictions to the we I in So, any term. have done close, on able get near

Scott Henry

Okay, the great. taking questions. Thank you for

Dan Peisert

Thank you, Scott.

Operator

Instructions] Executive [Operator Chief to session. question-and-answer our Peisert, I’d This concludes the over Officer closing to remarks. Dan like conference for any turn and President back

Dan Peisert

have have of opportunities development we for mature The positive this joining now Thank see all to their you, hope our Assertio pipeline this made of our plans. future Maxine. the results. the against you current Therapeutics. outlook excitement. And the been creating at can year, the priorities business here for and our progress they’ve I given in be business. restructuring tremendous we’ve our evening. value remain in NES of such We in our some investments historical results of the stakeholders flawlessly you Thank business. for and BD it We for a good We against all us financial and as seen trends a share have afternoon executed and committed there’s creating,

Operator

Thank for The conference has presentation. you today’s attending concluded. now

You may lines. your now disconnect

Assertio (ASRT) 4 Nov 212021 Q3 Earnings call transcript