OGN - Earnings call transcript Q3 2024

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Operator

Thanks for standing by. My name is Mandeep, and I'll be your operator today. At this time, I'd like to welcome everyone to the Organon Q3 2024 Earnings Call and Webcast. [Operator Instructions] I would now like to turn the call over to Jennifer Halchak, Vice President, Investor Relations.

You may begin.

Jennifer Halchak

operator. you, Thank everyone. Good morning, for joining XXXX you Third Organon's Call. Earnings Thank Quarter Juan Organon's are Financial Officer; as Organon's today me Chief of Officer; Arjona R&D. Head Kevin well Chief With our Ali, Executive Ferreira, Walsh, and as Camilo Matt

presentation be at our Presentations visible on during will we'll call & website presentation This Investor of will for Today, our available that of on following Events call this those be section Organon a referencing www.organon.com. you webcast. this also be Relations the

begin, the due by call Securities with and we the to results listeners company's our company's forward-looking Before those would and I caution management to Actual from Exchange that associated like by Commission, in discussed and uncertainties stated filings during certain risks filings. forward-looking subsequent or could periodic statements. including with business, statements will the information differ materially XX-K this implied discussed which conference are include

call, measures presentation. included will we substitute measures addition, In with is and prepared to not of non-GAAP press the in measures supplement and GAAP. for release measures this discuss be GAAP comparable a financial these accordance the non-GAAP call financial considered a reconciliation to A in on conference which certain should

I'd Kevin call now like over to turn CEO, Ali. the to our

Kevin Ali

quarter Good third results. you, we'll Welcome Jen. and talk morning, thank everyone, about to today's our where call,

rate at The quarter revenue representing currency. XXXX, was X% third constant of growth the Health billion, X%. For franchise $X.X Women's grew a

deliver have million $XXX onetime the Adjusted cash worth commitment in our cash representing margin $XX our of flow free quarter. of XX% in to before of are well Year-to-date, X%. in approximately free of EBITDA million, Adjusted on $X points of approximately XX%, includes generated track nearly billion we flow and costs million a basis XXXX. expense quarter Our up third booked Biosimilars margin. was EBITDA franchise Established XXX Brands IPR&D and was franchise the grew adjusted $XXX EBITDA

high Our significant still comfortably assets. potential us service free enables invest capacity dividend us to the cash flow and in gives to

year the at and into organic be revenue cycle this X.X% $XX raised to we view to of an for of plus constant planning which view growth represents development believe and in guidance we growth bridge, soon X.X% our recent of the walk contribution third a by The another year-to-date to in reflect We're on year, quarter. basis performance full guidance business too year improved guiding will of adjusted will EBITDA point is margin XXXX our $XX this XXXX represent of our call, Matt Jada of exchange. performance support also to XXXX. currency rest our That of X.X% in range Biosimilars, year, XX%, million new the on foreign next our in factors to by midpoint XX% Given that to revising growth The the drivers revenue addition for exchange nominal in that through driven you million constant it's year. range. NEXPLANON, strong full the of consecutive from X.X% IPR&D revenue ex third growth, and would Further, currency while Emgality. the year

X treatment much which addition age for cream already to has our X more patients. new years in of the for topical of attractive and its us a for QX is PDUFA adult and pediatric nonsteroidal In main of patients dermatitis near-term on treatment a able atopic dermatitis VTAMA date potential about Dermavant opportunity our a for in psoriasis indication proposed The older. for adults the indication, reasons. are we results is acquisition atopic assets, more we also plaque potential VTAMA topical the reporting share key to and Monday. VTAMA, approved today, the closed

There will treatment market. and if option with those market. can half dermatitis Xx market the as unmet for than as millions biologic we an profile in is of a it are better approved, the the suffering of profile, is unique patients, of address and compared tolerability second, sufferers believe atopic a First, And many be with the dermatitis. of safety atopic clinical all long this point psoriasis especially Because There care dermatitis can gap positioned important in the believe significant atopic children. for term. the atopic need a existing be patients used the we atopic as are topical to nearly in of that This dermatitis of the standard for VTAMA ever psoriasis. efficacy from size in dermatitis VTAMA much treatment of was

the view, versus for psoriasis our and day. is AD in night in fact, In opportunity VTAMA

So clinical what profile that so is is it differentiating? the about

have R&D, topic. on that us talk Juan We today, with our Head Camilo, of specifically more to

Juan Camilo Ferreira

the is controlled I'd Psoriasis psoriasis. that Thank can market Kevin. better autoimmune systemic atopic biologics. injectable you, patients in Kevin's about in with like how on a benefits much than to situated point VTAMA well more be disease frequently dermatitis is and from expand therapy, systemic

the irritation a In Atopic characterized is fairly like skin best other by with already is atopic in unmet of Therefore, hand, saturated topical disease on of market fact, the today is at and that chronic, biologics. time redness there dermatitis, addressed there with solution. the wasn't long-lasting critical dermatitis. need the psoriasis a VTAMA launch, inflammation, a was the

AD, The efficacious Pending Phase for the use need this restrictions than and approval, gap. for a different intended be consists it may with support the AD not is with topical to limitations The our the being treatment and JAK the no non-steroidal in results from of greater first symptomatic, were tolerability. that a clinical injectable which body is age black it that AD and use. Current and another highly our like and rate VTAMA trials is or available potential have a response itchiness good III suitable is for solution VTAMA innovation. are for mild-to-severe use broad, chronic a a label inhibitor mostly can area [ and steroids, proposed of options treatment biologics has atopic a a existing sleep long-term agents XXXXs so be and the levels not that one a efficacy, has highly covering of been ], X associated there of few with There are dermatitis children. is for safety in of biologic that ]. severe, for view profile of treatments that tolerability adults adults in FDA priced box Despite potentially children disease and significant fill lot the affect a high can X years [ associated with surface even During flare burden warning. demonstrated with

be Our proposed label of market. to truly other in label the the options would different

So atopic we who of are the novel dermatitis, and this make in bring been will the health who confident to longer have VTAMA care and patients condition, treatment if we're different efficacy trade-offs have no providers excited their the is option approved. this suffering to clinically of VTAMA and profile for safety to from between

Kevin Ali

Camilo. Thank you, Juan

VTAMA is very positioning this atopic critical a unmet a makes success-based the a about very the we're talking large confident option That economic from terms us of So that lot for And market attractive disproportionately need. combination in transaction towards a clinically in the approved. milestones. with a makes differentiated with in treatment standpoint, for The capital allocation skewed of if are dermatitis, transaction Organon. sense commercial

be X with year the $XXX to to next to from points, XX expect accelerating dilutive million in earnings VTAMA $X.X We of expect X, at over margin to grow basis least potential to be XXXX EBITDA expect billion In the to sales we years. by and in to we achieve of XXXX, with transaction transaction our the the accretive about X there.

nicely therapeutic Organon's also in expertise leverages acquisition dermatology. The existing

to products levels. a dermatology addition very existing U.S. the revenues portfolio of allows of where in team local The Our dermatology in million national access we of at scaled and the VTAMA state have us U.S., X delivered $XXX and presence a outside create experienced the XXXX.

VTAMA access, approval, focused internationally to improving time. on down expanding have indication gross-to-net believe We VTAMA's expect in will the the AD prospects launch We'll it growth position owner we Organon. launch the of to the solid profile road. are of to financial Overall, to healthy We believe margins. potential best immediately a solidly be contribute ultimately and the after we with also over

quarter third U.S. the X% the of strength due review NEXPLANON rest Women's in the in as well of growth We let's the outside including tenders NEXPLANON, in in grew XX% third In ex quarter. benefited NEXPLANON in program greater ex XXXB of pricing discount U.S. So NEXPLANON's Latin management strategy, our XX% America. demand continued continued down up U.S., detail. Growth the the was to physician by quarter. from in business was third was in as driven FX FX the in the the which the market, leadership timing contraception primarily Health

Given with We yet next billion achieve we signaled to the full NEXPLANON launch be positions us NEXPLANON the position our strong the NEXPLANON's growth milestone the This currency year to we about that constant the year-to-date expanding a in and can in months, the extremely year indication. assuming ready approval. best plan low performance, the put making revenue next be late the We FDA us achieve proposed remain prospects would well would brand few X-year for FDA optimistic year. our expect had mid-teens. and XXXX potential to future very for of a submission through on to which $X in

be contract this quarter to expansion work Fertility, see reimbursement performance won't rebound spin-related year that noise we the adjustments with other related in PBM Moving women's ex of inventory to and in exit. FX IOM in model up have as China, business quarter, operating the large third by the a down year. the and growth very XX% exiting to of health. Though underpinned as We international in slightly a we in strong a onboarding year U.S. for interim the expect Fertility through fourth U.S. the continuing our last XXXX on ART-expanded

franchise, grew currency third now our to move Biosimilars the Let's at constant which XX% quarter. in

a teens to low will full at next with unusually Biosimilars be is asset years. growth for their point which couple of U.S., impressive performed deliver in growth launch period. ONTRUZANT the growth new sequentially. XXXX, in every in year driven grow the mature Biosimilars of strategy long expect RENFLEXIS The and to the Biosimilars to and continued year HADLIMA continues We uptake and has by well

growth asset asset. approval. beyond, with Henlius FDA denosumab and additional pending contributors XXXX launched be franchise review and to be will Biosimilars pertuzumab collaboration late the than in Shanghai the will later the In Both

accepted this providing in treatment closer potentially yesterday, asset, option announced us bringing for to patients XXXX. Just biologics step the the the denosumab application to that U.S. license we our FDA in a

X% grew FX third quarter FX which then rounding year-to-date. in Brands, ex out discussion And X% our ex with Established and up the

expect injectable the mandatory better to commitments deliver are on basis as confident franchise Overall, and encouraged Emgality growth year. to revisions and the full recovery year of about offset in flat a steroids ability the expected remain our of Atozet LOE to to the year-to-date We performance deliver pricing we are slightly performance Japan. very and on in our very our for in full

financial I'll our in it discuss now turn detail. over will greater who to Matt, performance

Matthew Walsh

Thank you, Beginning Kevin. X. Slide on

Here, we the third quarter for bridge revenue year-over-year.

or in constant Atozet of quarter, Kevin exclusivity from in from of X% of about in the $X.XX that the September. We and X round headwind year out. included third VBP meaningful LOE in million now was was and the the LOE approximate REMERON an last up of Atozet began HYZAAR quarter as at in third ahead of Impact in impact outset, Europe, any X.X%. revenue effects the from third which which year in loss beginnings are third quarter the the at and have quarter $XX the quarter of last million reflects didn't X% third negligible of billion price quarter impact washing There mentioned happened As and $X the over about Japan was currency.

to due half mandatory second cardio headwinds we back of we respiratory than mainly would timing that first pricing price portfolios, quarter are may call, said that the You face the what in in recall steeper the the XXXX Japan, of reductions which seeing. in is and from half our

volume NuvaRing to Brands, XX% were and LOE DULERA across like the of were Fertility, Emgality the growth, China. million HADLIMA especially RENFLEXIS. Spain We're contributors drivers. U.S. Timing several the by NEXPLANON quarter growth. in largest as and or in also seeing and in NuvaRing, in was September in pricing France as tenders offsets the certain products volume from headwinds almost of the the biggest from Atozet of followed to Volume and Established ONTRUZANT, U.S. mature growth $XXX well coming

arrangements which the change bucket Supply as manufacturing we In been spin-off this Other, we although with only expected, since here, was quarter. have the year-over-year this a contract declining there small have Merck, that in capture lower-margin

foreign foreign currencies included approximate which the or lastly, basis headwind And real. reflects and $XX exchange Japanese U.S. strengthening an points the translation versus impact certain of million to XXX which peso, had Mexican dollar quarter yen this revenue, Brazilian

Now key performance. third and quarter non-GAAP we let's show turn metrics Slide where line for to XX, items P&L

For reference, this and non-GAAP financial press in the GAAP the in presentation. appendix the financials to release included measures reconciliations and of are our slides

from cost accounting seen goods amortization our appendix items, of For in purchase gross profit, which slides. and are can sold, we excluding onetime be

was of quarter margin mix XX.X% the the the was margin related and price. In gross Adjusted compared product unfavorable XX.X% adjusted third with in lower in of last year. primarily gross third quarter of quarter to the XXXX, XXXX third

expense expenses denosumab containment our million the were non-GAAP X% candidates. reflective the Excluding third cost million pertuzumab efforts. $XX the further it of $XX biosimilar Henlius Shanghai year-over-year, advancement operating in of expense IPR&D of with our Of quarter, of period, the IPR&D incurred for related collaboration to virtually down all of and during

of not end While of surpass pretty the we IPR&D trigger have further to an line we until do any have practice to would payments. guiding XXXX, from expect don't IPR&D, established now good that milestones of we sight

our progressing, $XX year-to-date. are our sustain the These represents in and expense headwind XX.X% the are the While is growth compared quarter building year EBITDA full signals an margin ability factors XXXX. of of third in of million payments adjusted XX% we into XXXX, quarter third of to total IPR&D well that of future. the culminated XXX for basis in pipeline strong about points revenue These of with the a

per the higher purposes, with than one per million diluted impact in the net $X.XX range non-GAAP a $X.XX entities. effective for $XXX almost million which net the period. share this income actually release income equal against XXXX's million tax of Non-GAAP from GAAP income tax valuation development, allowance asset does favorable, in earnings GAAP this while net $XXX of the adjusted And same or net benefited XX.X% remains not of Swiss our guidance income was $XXX quarter. rate amount of or the share, non-GAAP to was company's XX.X%. of in the

Dermavant onetime year-to-date. at deliver XX. And look Turning minor headwinds We mentioned, as to Kevin closer Slide provide billion million. Year-to-date, costs acquisition, were a well free despite some our flow track cash we're the from those onetime before of flow charges. spin-related on $XXX to approximately $X cash

Our these driver ERP was costs. us, and the that behind now implementation of is onetime largest global

be quarter will Our costs that view is the minimal. fourth this into category in

were is So the we million approximately which spin-related the XXXX. finish than $XXX expect at to of $XXX year million onetime that costs we forecasting better for originally

would we in expect minimis. onetime XXXX, year, to costs Next be de spin-related

spin-related count restructuring year-to-date amounted we other cash these for In $XX head distinct have from XXXX. network activities the separate capture associated outlay the optimization from initiatives actions to with eventual margin Merck, network efficiencies drive here, optimization. cost The onetime and costs will million supply costs of our to ultimately manufacturing costs, they're million They that $XXX are chain manufacturing and which and gross away improvement. and

year. total to bucket this expect $XX this about million We

quarter than on X.Xx have our generation, net leverage better will start resulted the and X.Xx which Turning were turn in X.Xx. at favorable stronger take which to time expectations was acquisition we to Dermavant slightly leverage September we the year. That the had at quarter has that year We said, several as at us than XX. the also can digest the XX, year-end, Year-to-date, this achieved ended to EBITDA quarters that where at XXXX, ratio, this before a we've X.XX our of return more Slide than ratio better last leverage leverage a it is ratio net end. of

guidance highlight XXXX to XX, the driving Now XXXX revenue where range. turning guidance our on items we Slide

which on X.X% $XX to As our raised equates and X.X% currency range X.X% the X.X% mentioned, we've tightened to growth midpoint basis. nominal million, year-on-year, Kevin to revenue constant a representing by

to LOE, to million $XX range uptake lowered million for For slower to which million reflects our $XX we from million, generics for $XX $XX Atozet.

headwind price pricing our of from year-to-date, We've so view $XXX bit round the the million, HYZAAR. doing $XX business. from to price in acute more $XX VBP lowered price point a on million line the be X the to lowered more Atozet associated to the representing Sequentially, better half million our mandatory in full we across materialize. in which revisions $XX million, versus accelerate our percentage for with an is delay as which million longer-term pricing right, to on on impact approximate of range REMERON of impact EU and from million been reflects to impact Moving $XXX back to million is realizing XXXX to in the LOE $XXX Japan and million $XXX in and slight price a expectations expected fully impact prior the revenue year, X.X with the has we $XX to reductions similarly entire in been

mature pressures products Additionally, RENFLEXIS facing U.S. NuvaRing. increasing competitive such as the we're in and within DULERA,

And our mainly tempering Fertility a year, X% that's for narrowed attributable the $XXX rate $XX on $XX also approximate year. on $XXX were $XX driver we million. to we over volume softer to reflects volume down XX% X% million. from last million million, at for outlook the For rate view to guide range growth million on volume to and lowered principal finally, the is mentioned FX current to million the of the that's to our XX% $XXX from and $XXX from we to million, in we've that The the lowered to $XXX to down growth of down the midpoint year, outset revising expected, million improvement for million an FX, range from million and by our XX% of $XXX raising XX%. adjusted EBITDA Kevin impact our $XX view revenue range to based

In Slide in IPR&D about the year. XX, we we million the margin driver the $XX basis quarter third driving for the is bridge items XX of of full points largest worth expense the booked The incremental change.

are mix fourth This likely our in unfavorable product can that competitive products on view and group about in pressure. NuvaRing DULERA certain worth some at the seeing pricing points year. their we'll specific, margin the unfavorable basis higher have cycle. full our portfolio subject pressure and we're ONTRUZANT, into Second, are to revenue, see is products, of primarily related to where XX to from some of quarter channel of we gross mix U.S. mature part be which growth this that

The seen the our year-to-date rebound While pressure fairly in you X next of U.S. gross our Fertility dynamic synergy. range. with have fourth new you items in adjusted brands. tandem calendar their an EBITDA of strong margin X When year. see we last The offset bridges pressure in margin strong onboarding current the the combined in base margin serve to expense months to should VTAMA, these profile business, no a as of net the rate, at midpoint business so the of and year mature that Dermavant productivity represents column represents

to components now of Slide XX, show earnings where our Turning guidance. we all

to just to year-to-date that our to On range margin consistent better billion revising by XXXX are we SG&A to driven billion to XX% $XX at discussed, billion year our million commentary approximately $X.XX and $X.X favorability. the billion, from For we $X.X gross from midpoint the XX.X%. $X.X XX% expense, revenue tightened full with we range

for third of midpoint points basis, we EBITDA For that spend and the basis year R&D million the incremental of On R&D, year-to-date and that's booked expense million, XXX on using around our $XX margin adjusted we adjusted total $XX the worth guide. IPR&D the the quarter. the full base in midpoint tightened of was a IPR&D our of range about

million see to soon to from as as too Those other well plus guiding revenue Dermavant across challenges will plus that growth across organic factors be the we portfolio. to the we it's includes said, portfolio, Kevin expect year revenue Atozet see Kevin we to directionally, $XXX year-on-year. referenced. might next XXXX, be As LOE of but This believe the growth do offsetting any the

VTAMA atopic About for Dermavant indication, in hope fixed profitability, receive approval of this be is the X/X In XXXX, about and operating and expect Dermavant is Dermavant to do approval. the dermatitis launch focused in dilutive on operating million successful acquisition will be this thereafter. XXXX will accretive of quarter, we marketing and be $XXX to and in the to We sales we onboarding XXXX which of FDA form expect expense capabilities. for pending expense

successfully offset acted will become revenue further around AD expect been to this expect company flex further realized to above XXXX, we XXXX, a of from be be grow or Organon's opportunities AD grow quite to VTAMA synergies expense other and can discipline X.X as we account average is business are support launch to with In margins we either and business approximately and the continue as for that our margin across and launch which, spend the down Dermavant year. accelerates The point other parts directionally, if doing there. X/X other from promotional we've of naturally headwind, for will to of synergies. else In after EBITDA looking see launch we course,

deliver our before out, of our belt in onetime flow up in to of on X items. revenue of we a free growth deliver billion X the a to [ very ex that year left leveraged and XXXX, about ] feel good ability months ourselves milestones to under dollars, P&L trifecta go, Closing goal. cash quarters With [indiscernible] set we and $X

and answers. questions now over the that, turn With call let's to

Operator

first Balaji with Our Barclays. of the [Operator question Prasad from line Instructions] comes

Balaji Prasad

year, from on on of well terms the allocation. VTAMA, of It the contribution in comment deal. be political profitability you And capital second Could into drivers probably more but question the NEXPLANON, current Firstly, psoriasis NEXPLANON. seems vis-a-vis $XXX next on on topic, into getting you the to EBITDA comment out slightly congratulations laid and LARCs atopic Dermavant OpEx or climate maybe up split business more around the million, a for specifically is spend and spend? dermatitis current growth can on sensitive maybe versus it

Kevin Ali

do want the take to you Matt, one? first

Matthew Walsh

Yes.

X -- your XXXX. we've our got in guidance rest VTAMA months So for included of of

rate so approximately and per mean we in be forecasting run looking of nominal. for million And talking $X revenue of month, same we're this it's I as about we're the at would period a level XXXX. dilution stub

VTAMA that's piece. So the

Kevin Ali

And actually in access to of threat a on question. Balaji, in to contraception a your the going NEXPLANON, issue I in. be regard at all. know aisle, it's from regards a came and coming general, very obviously back the -- on aisle, regarding just think I access LARCs, timely of I question tell sides it's hill you meetings on not new D.C. we in can the to health sides women's with the is administration around to And both to both

whether get nobody doubling As issues. sorts or kind fertility kind any health-related of access on be that contraception reproductive order a wants discussions I a of in around matter both able to to address to sides, of there's think down into it's of fact, to

to in XXXB but future. the with centers in health a business terms our And continued a of very, strong. see and the along also our especially LARCs. well that's is then leader qualified the So And in in contraception for great in we only in We're federally market going growth, us very that the business of opportunity terms -- also NEXPLANON U.S. demand, not continues space, go is

next is blockbuster billion, obviously lot faster Thanks years a NEXPLANON kind and of big I reach major the we'll And in we it runway. for driving for than U.S. question. that's the us of that which anticipated $X a globally first of year of our product, ahead for see portion milestone the of in -- So terms for for with Organon.

Operator

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

David Amsellem

couple for So me. a just

you new assets? thinking looking to aesthetics? So rate now leveraging medical get the that thinking of want How the just therapeutic derm commercial aggressive How you And in additional particularly that with your it Dermavant, over medical infrastructure change is a acquisition medical term be? by to Are long and place, you vertical. in you assets that open derm are of about the a to or have are acquisition, infrastructure M&A And is do also lower the you then capital deployment? on how front, does environment. progressive more in on this

things the Just thinking in interest acquisition the environment? of a context and in of the philosophically, how about wake rate are lower you

Kevin Ali

can I I those -- David. address Thanks, can questions.

First, to listed them script in U.S., new I for been the the always in fans -- are. opportunities vertical regard in Dermavant bringing big in terms what very and this atopic of VTAMA dermatitis. we've terms of in where the my in out of opportunities

a enthusiastic to. of that the think even be atopic use continues for tolerated to a for about. spoke and bullish within potentially, of -- well and potentially that I'd a the really very periods something product, we so And is feel dermatitis very this space efficacy say, It's -- both time. Camilo biologic, very, And great and in Juan I you saw great greater differentiation that long that position

a about it opens David, opportunity new up And really excited you're So us. right, definitely over time, for that.

so hopefully we as future. taking not-too-distant mind on can. in Now be to going as have for we We're as soon will VTAMA, launching country. track opportunities keep path do the We're the that that internationalize first in in to that be Canada

addition to Japan. also also, a portfolio. agreement be with other we'll nice countries -- we And looking in as royalty a that have our well. at So But will be

it a different U.S., that within from we well. the opportunities. But as opens royalties of getting opportunities be we'll quite up partnership bit that different see of So definitely, -- variety a

only from of that the will derm the that anti-infectives, and Look, access expand know levels the VTAMA, we with intend whether expertise all we the on between. this access as different state as national for of And we team We've front. essentially well the all not in to way that local especially the all help that few our from, to them, You mentioned best of some aesthetics folks everything it's them with as as came is really you a kind bringing ourselves have, where opportunities, support Dermavant also in establishing top-notch. future levels space. is got the and to we're well but regional, on over

the well we -- think come be to of will are as regards VTAMA as pure and future performance, well really ] In of driving going, where bridge right pure in our really cross the when it. capital focus about allocation to that as integrating [ then for focus terms XXXX, we'll I rates now, as BD

Operator

from comes the question America. next Our of of line with Bank Jason Gerberry

Jason Gerberry

Dermavant dilution follow to incremental selling profile. able wondering you're conceptually the therapeutic talk new to own you up costs the this on And with is wanted in-house marketing and resources. a accretion Just can what through absorb just versus if vertical, given your

point I at than your Dermavant versus million $XXX about talked million so number. OpEx more $XXX think or one

increased this points proposed first of don't story in sort product the your into back FDA getting are just alternatively, know raised just unreceptive around infrastructure? your What if the [indiscernible]? then cost at FDA And attempt just they Or basically putting the $XXX attention the kind filed, are NEXPLANON those you to to guidance? clarity the inputs. of less to there the So on in Citizens to I'm pay similarity is AD maybe to baked cost wondering, the not in I to were petition product-specific get some behind get or there that? fully any is Or offsets wanted million, is changes is, were I applicator that your

Matthew Walsh

the first, Jason. question So VTAMA I'll take

not Dermavant exactly perspective, disclosure an has from sure So OpEx what been. I'm

$XXX in terms see $XXX broken is in roughly barrel. approximate to for forward. costs sales million driver and very that its out, onboard onboarding is lock, sales intend right that That's capability stock and how I think expertise, value X/X of cost absolutely going focused think of we're operating round is U.S. and about we're a the we that And we that derm onboarding -- which number. million. in cost We us number a And of way. on the and marketing that expertise marketing the key for is

cost under we you million part ownership were achieve might talking the is come difference year coming will prior the about be synergies -- And And the costs $XXX a at OpEx the significant already looking we're under as the versus I them of remainder. R&D think the of that in off. next so, from

we're a see what And distinction from that's OpEx we I are to will revenue we comments, that very of for think estimates. believe believe thereafter just the product. at dilution onboarding onboarding between -- be accretive So achievable XXXX and XXXX. important prepared reiterate benchmarks It the from we the year just prior pretty for in and X

Kevin Ali

in the petition, still of submission question And Jason, to on it's pending. regard the

terms get in response the we is XXXX. that So to have that I speak can't until protection we wanted a device But the patent applicator and own from clarify to of And fact our when on issue want can't that think needs understood design use our to clinical devise I FDA. be I essentially do to a and applicator completely submit -- unless you applicator, until in new -- that past XXXX. that the your studies, you new

always insert IUD in said, mention of just to the want so I And post device I've a investments again, now LOE to of fact how the not look we're of but to the huge terms that. have all the and The But fact is and and amount still of aspect And X nature no FDA in in in true only It's is goal at it. generics of to the to the medical to not not proxy, other a things you've like is, you that there's sales of an market. thing that pharmacovigilance like easy you all that if infrastructure make not of train remove one years goes do, signaled force -- the use the the a also, protection. terms on your that. Mirena it's patent affairs just applicator of an fact matter very physicians easy into sensitive and terms when of also that and rod, your got

the of for So runway think terms I NEXPLANON. view my ahead that's in

Operator

comes the Evercore next question Our ISI. Raffat of from Umer line with

Umer Raffat

that back? ex can intend that do spend well? inclusive how the underperforms, scenario you U.S. the in OpEx pull VTAMA much curious, of referred $XXX to, you I'm million you a in is where to And the as

Matthew Walsh

of take question. that the I'll first So part

in of back? back -- significance $XXX can And of million how for can that. of it OpEx cut pull terms -- you focused. ex There's U.S. part in So nothing really question the XXXX, the that's really in can the always much we second the spend. U.S. we promotional for Look, on

have in in the that know XXXX. to would we on place I plans don't focused We cost that structure, synergize G&A on the of be pieces but

successful the our putting of be behind of will energies all launch VTAMA. We

let's next the key. XXXX really So are XX the end after months, of say,

have And XXXX. beyond so, that retrenchment, think looking we'll at we about if be Umer, to

Operator

Kevin That will back to now turn Ali I over call concludes our closing for remarks. session. Q&A the

Kevin Ali

you. Thank

Just I very in -- look, XXXX, closing, execution, believe, commercial been strong. XXXX has our in

mentioned support year well Our I added for $X recently, most earlier, of we've we've largest onetime discussed extremely billion been we've operating driving deliver full billion as and revenue this the growth morning, $X year, growth and on Emgality adjusted to VTAMA. cash disciplined notable next NEXPLANON achieving drivers is flow product costs what of other XXXX. and just in costs positioned, Further, before EBITDA free of with

we're a dialing and you to solid to for soon. thank So want we track well you we'll delivering to talk today, on year, very in and

Operator

concludes This call. today's

disconnect. now may You

Organon & Co. (OGN) 31 Oct 242024 Q3 Earnings call transcript