ANIK - Earnings call transcript Q2 2018 | Anika Therapeutics, Inc.

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Operator

Good morning, ladies and gentlemen, and welcome to Anika Therapeutics Second Quarter 2018 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions]. I will now turn the call over to Sylvia Cheung, Chief Financial Officer. proceed. Please

Sylvia Cheung

Chief morning, earnings you the call. is President Good second joining call and Darling. Anika's XXXX Joseph quarter With and everyone, you. for thank our today Thank Officer, Executive me on

website During section today's review quarter our anikatherapeutics.com. which financial is at XXXX the earnings highlights, in I of release and Investors business A summarized available our earnings copy key of second results were Joe call, and our will in Relations issued the yesterday. release

In section & on to Investor We number addition, along open is website our presentation us. posted you the to with a slide Slide under One. presentation Please the in the follow to file take invite Presentations Relations a moment Events and the tab. turn

differ please based made Act Before beliefs our materially from constitute see the Please performance Joseph also remember conference to call results. Please for affect two, could defined SEC statements company's number The are Joe? statements Exchange and I Securities risks and now and subject that actual statements today's on could certain forward-looking These to call during future as as the certain over anticipated Slide in are our and current filings that achievements. information our and more turn results, our turn Darling. about any uncertainties. factors expectations XXXX. results we CEO, of begin,

Joseph Darling

to good Welcome earnings morning, our and Sylvia, everyone. quarter you, second Thank call. XXXX

value. our and documented financial in ability in shortly, are our we been confident our results and drive While growth further recent quarter second pleased have and shareholder to will those well discuss challenges the with remain

operational to business demonstrate growth U.S. our viscosupplementation performance strength initiatives financial our our operational the success driven in Our of improve results and primarily and by business which and performance. were of the our improved

transformation business for take my and a level perspective operational I moment the the Before commercial the and well on high integrated confident company. Anika positioned a are updates dive that we provide continue fully to into is quarter, into its why financial we want to to

having decisions our our a We other determined that pricing of of market our a and such product portion contracts have end large our line. history little destiny, had for own partners control are as exceptional too structured over

capabilities our beyond However, those just go and contract of expertise manufacturer. far a

an to control I As of future Anika, greater as portfolio we such When growth, with joined orthopedic pivotal that I shortly, leadership leading future. Anika working part company an initiatives we moment growth. we accelerate excited encounter that first with orthopedic global tremendous gain of as therapeutic strategic was under market work company a pipeline will a actively and diversified new products commercial at to Anika company. I for has detail potential. the be I are and emerging innovative, and likely and to and high new some differentiated the to was would I a our challenges a knew of joining medicine profitable position

performance. to our our resources also We enhancing evaluation to begun our I this improve growth confident our of stronger I than trajectory. several resources our have beyond. quarter. growth of performance. recent operations that opportunities opportunities optimism we Anika and while a our were our and financial future we and sure CEO end mid-term to next make optimize time, couple a our further and can I the the where and and in first maximizing year, to before was March years over weeks revenue several in accelerate appointed of of earnings and a quickly ever. operational current and company processes despite thorough strategy, Since have my wanted identified that we Anika is Importantly, the that initiatives, opportunities is for am our excitement growth reach continue of near commercial the we refocus

these we're significant towards realizing opportunities. progress Importantly, making

engagement with is U.S. see not our market. U.S., fair I share the The area hybrid a currently improving focus where or either distributor we has partnership oversight getting outside of correlation the approach and first optimal. our believe the are the model a international we direct In with performance markets still direct in

working can However jumpstart international our I our existing company. international our I and our and our programs optimize the sales confident successful seasoned will networks assess our sales order with implement products closely This internationally, region collaboration for to where distributors record initiatives necessary. am building ongoing new recently penetration partners also order proud led country generate awareness strong drive growth our product and that ensure overall with a international performance. to and optimize every improve marketing greater we distribution in a we to oversight changes will to improve our we and distributor returns managing performance to international end, from our In our the greater market their am and new on say and and order initiatives in see we support veteran track ground, a growth, clear increase of performance. of expertise expand enable To to to that to to structure and involvement processes commercial opportunity activities improved to OUS network. we and markets hired partners in our be portfolio within of industry with

to operational already Operation benefits recently is of U.S. hired and area will we management. processes, systems Vice coming drive over with second implementing efforts. see operational utilization, of a improved focus to And the in months, people and optimizing The President the be the distribution been to We tasked enhancements resource performance. manufacturing, his was We're efficiency starting driving inventory

right execute that need recent as team As initiatives. evidenced these the by in hires, we place realize we to our have we

growth while innovation portfolio. sustain supplementing, in my to will topline to that term the to know need we shareholders. throughout strive deliver prior product always talents not role reinforcing internal right realize also committed the which leadership that Based we long is To play that organizations, are to larger a the our We we end in alone augmenting I R&D Anika. experiences enough and success, on

are to cases on supplement focused partnerships some acquisitions and in growth. organic We actively and targeted

We specific actively allow Strategy will for to We number profitable towards targets elevated that have efforts the shareholders. CINGAL. already implemented internal Chief our candidates development a growth to define generation between enhance activities develop we and screening of product internally and and and will drive focused of are technology the efforts that next of company Officer portfolio Technology bridge our business us such in our as gap recently refocused MONOVISC products

beyond. Officer, I'd look like to Sylvia? currently years details a forward and quarter sustain recent are review double outlining provide Chief addition to our we our growth ongoing before our in the XXXX detailed We and to these our Cheung plan about more results, initiatives, deliver In now in revenue five developing financial strategic and turn Financial second the strategic enhance to coming ongoing plan months. Sylvia growth. mitigate the to to over challenges call to I digit initiatives

Sylvia Cheung

end due for XX MONOVISC prior milestone consecutive $XXX reaching for to last you, The million the user deference of achievement period primarily a U.S. of sales was a was dollars to month second revenue million in million result the Total $XX.X quarter $X within Thank year. the of quarter in dollars year of $XX.X year-over-year compared period. as Joe. revenue a

second U.S. revenue product Three, MONOVISC of the see XX% U.S. first royalty achieved you quarter quarter. sequential viscosupplementation in a single the the As in basis, revenue On year-over-year, and performance. quarter driven ORTHOVISC MONOVISC position can primarily the revenue U.S. number and resulting segment, on and which to injection end product double Domestically, X% the of revenue in The combined experienced due in revenue for and MONOVISC MONOVISC Slide here by migration increased this during one ORTHOVISC quarter number viscosupplementation quarter, we XX% the end of growth quarter, this fiscal in the for sales user year. maintained MONOVISC States increased percentage experienced to year-over-year strong International year-over-year price. second for United we volume the MONOVISC continue. quarter, $XXX,XXX in year. multi was to to compared last one at of to XX% flat the for around and this sales decreased due price toward And two while primarily increase the one for share quarter about on revenue in to XXXX expect relative orders. a second proportion of increase ORTHOVISC was user viscosupplementation one volume of U.S. the digit beginning in timing and

XX% expect digit XX% Product compared of basis. gross XXXX a our for quarter business quarter for was the We on second double from for to quarter full and international year. second margin last year of the XX% first viscosupplementation the growth

our initial in quarter to initiatives of to number a and efforts executing were $XX.X past actively are the Total costs second million costs increased operating are revenue due expanded the and worldwide quarter. million was we of we in see expenses as to of operating $XX.X production pleased mentioned, a increased initiatives. in Joe this As increase primarily efficiency commercial quarter of result growth, XXXX. compared personnel The to the product increase results

quarter analysis of confidence capital With position full the strategy to the XXXX will approach revenue we benefits change Our were in effective $X.X diluted due tax investments in offset income to million $XX.X a focused capital capital of to million financial take always the both under tax XXXX. or revenue have implementation deploying rate repurchase to in exercises in our discussed. operating the updated was information, quarter to the reflects or completion of program. our $X in per income of $XX.X XXX,XXX our future. of for are million available most share and milestone also of compared favorable share program program was employees $X.XX our our million option internal was repurchase partially shareholders stock a We employee exclude our and $X.XX shares and the and investment capital quarter related Returning milestone on in balance ensure accelerated The impacted the ended of said, to by repurchased that XXXX. sheet. diluted by stock to part our which our balanced disciplined the option total in second the primarily a strategic per approximately our $XX organic current July and previously decline revenue for positively in Net allocation and share and XX% expected allocation creating a was we and of exercises. from strong We to Based for on share year tax completed cash the quarter and as net with million the expenses approximately M&A increase $XXX guidance our value effect on are previously opportunities. million we

expect year continue full revenue be level as the around We product for XXXX to same the XXXX. to of

We margin XXXX. offset are expect also milestone year in now XX operating gross percentage The XXXX the the lower the from be on product U.S. range. SG&A around CINGAL earnings million expected with high impact $XX the of range reduction to to by is XXXX to expected revenue full for marketing associated full low expenses ninety for activities. of in Total year pre-launch be be

third voluntary down revenue mainly effects transfer recall to Additionally, the U.S. pricing. prior a of initiated from from viscosupplementation year, decreased the this we earlier a in product year as and slightly expect result be quarter

our transfer royalty that revenue end product pricing impact now we prices the prices strategy. in turn price to quarters saw like during context on we decreased sales two end means the events product pricing first in This will initiative to on provide quarter, some recent and while ORTHOVISC of business sale market our I'd the discuss and development to market the reminder, well arrears. U.S. the reflects of that as our experience as Joe transfer our year. user MONOVISC to based and are now U.S. this and call a ORTHOVISC about quarter As back MONOVISC the from product

Joseph Darling

turn will CINGAL. Thank an update you, Slide to Sylvia. on turn number now to Four. I Please

that like from by had announced evaluated therapy. were obviously disappointed is Despite durable reduction gathered we trial and which safety and clinical pain experienced trial, results XX-XX thinking rationale data the trial CINGAL combination be June, the our I'd the novel subject these that believe data that in the this design for validates support well from believe as clinical now of to believe efficacy to our about U.S. result regarding in current we the several be as XX-XX from rapid we the the clinical existing studies. studies very approval. may studies clear CINGAL. sufficient The control While has by of we demonstrate CINGAL. surprised We been

this patients intend have the all monitor results. phase extension As to we a of continue the the data week XX-XX will to FDA through with actively the data which noted to designed to once chance XX gather in study closed XX discuss We results had analyze earlier a year, weeks. we the relevant

While need based CINGAL we data approval support the to we on for clinical believe will have the potential to a also U.S. studies, understand a pathway we we chance additional approval. that there's gather existing

multiple determined strategies, next to Slide turn and preparing can expeditiously receive We appropriate update once had are Five. we additional we number forward. our have We that from intend the CINGAL FDA the move on when discussions so Please guidance have we forward path with to FDA. an provide

the new are U.S. process. by the past repair million a the by growth an regenerative osteoconductive during bone medicine received in is is this preparing actively to bone Beyond that graft first CINGAL, launched opportunity This the pleased substitute and bone XXX treatment product self-setting product XXXX of treatment market This am commercial resorbed which I replaced are represents launch body and XXX we clearance the we our December. XXX-K of provides million injectable say to healing for

are Given current product, partnering interest the we new model growing or may in partners. with that commercial this a exploring hybrid include

the and overwhelmingly clinical HYALOFAST. support have to and the III online conducting The program opportunity sites is first approval. treatment positive. properties U.S. product treatment HYALOFAST you finding use surgeons based FDA U.S. months greatly XX surgical has This the clinical procedure. reception to are the trial for novel on U.S. been know, that we come an Moving in Phase international the they're as currently to to past enhance the this the over

While trial the regenerative and we conducted changing that of very in to unique microfracture high arm to Phase is expect continue the patients this for is being III within the a to physicians arm is the enrollment enthusiasm year. this we landscape to reluctant level that among end which are no longer to see patients physicians The trial complete by randomization with treatment, of of respect and trial. a randomized

we an important the HYALOFAST of significant half and market than provide to revised view With strategies completion a are billion accelerate We to as for enrollment as revenue trial conservative pursuing size U.S. possible. potential. a will a timeline the the future soon greater expected with annually, continue of as product

in HYAFF phase X, we're also As a and of its demonstrates approximately acid for advancing which you repair This Slide U.S. prototype is $XXX year. hyaluronic regenerative XXX,XXX of platform. procedures can conceptual treatment see cuff million noval procedures to the on with U.S. million development rotator each technology $XXX market opportunity versatility based a of the over alone on represents our in our product

We potential could also a product think a candidate this be for partnership.

the We end prototype are by a to on first of year. track have the

we report In year our versatile With phase diverse next balance the by year. the technology target well end HYAFF had and the commercial with recall discipline our received May in back be overall have well mark talent to for drive MONOVISC grow our in to create right the a and as strong it foundation while market forthcoming significant hands are products success, this not temporary we platform of and of we as to closing, by to vision as we financial a administrators’ talent also in voluntary a term world based portfolio percentage focused near growth a shareholders. long five Lastly, confident patients strategic in I CE new of a we value for drive clear our am expected do for of am was a revenue, impacted pleased we updated we that positioned culture certain class and strategic plan, in and accountability. following need what know can and sheet suspension. I an of are in reassign with on leadership coupled route

take happy Thank questions. are to you. now your We

Operator

first the line [Operator of First Munda from with question Instructions] Our Joe comes Analysis.

open. Your is line

Joe Munda

and Good you morning, okay? me hear Sylvia. Joe Can

Joseph Darling

morning. good Joe, can We

Sylvia Cheung

Joe. morning, Good

Joe Munda

update. that, least. pretty off you from end extensive and for appreciate Thank it at first my comprehensive Really

come talked probably would So and expect acquired I'll to or then and in you've with to growth well are you start to guidance going much expectation you as and think this know said accelerate how it's an growth I of help know range, the organic closer know plan how and being distributers given us working to from improvements I on just do early this outlook, off digit But growth? to we next going early growth, the the regards back possible you're hop a one M&A be the want to you with into mean for follow-up Joe, drive you that I'll about strategic the you of back in the I know versus question the to for queue. but some product of as flat transaction year year is be that to or that year double much a

Joseph Darling

Joe, down couple me break let into a the it's and question question a different great components.

and the we international expect contributed well. product variety would that we repair Also for on a activities including U.S. product. We the significantly that of First also a will to that result growth introduction see that whether including XXXX. of new outside as the as bone growth anticipate increased the components focus that

continuously In as targets. this mentioned M&A potential I opportunity, in screening earlier we are terms call,

the this point that. But is rather the future. you put know strategic rest that You to assured stake a do in to as know you can a that it's early we I'd probably not too at and look priority ground

Joe? that answer does So your question,

Joe Munda

what trying possibly know you're Essentially though model talked said, helpful. Yeah, follow-up about will CINGAL still a And figure forward about or go hybrid but a U.S. you sales strategize to you strategy, to even if you you you a talk direct you just that's in you and CINGAL. of that. then out know know force still regardless you

I how well force into that know as there can color bone the look? as of us is sales mean is and on expectation going double So possibly, much you growth would some to carrying that you that that is that dynamics guess give how digit factoring I the product be

Joseph Darling

Yeah, first. let me explain hybrid the approach

look chance know sales Anika the you as that our at help watch had the now in position here soft is pre-launch options, what in for of to a pressure I potential small especially know or for on reducing and I products can a available to looking line You see the opportunities force need settle very at at seeding partnership distribution. the clearly the by SG&A

want I the a we're and building So then that about sales not are clear the magnitude the large to street closely a partner. a awareness feed with be having but about that talking here, working of on pre-launch can we talking activities, help pre-market up force

as really way is Anika structured the tell know to in well. is going the at things that are such other the to result also to drives the can I a way any look You it's think are but partnership you I not be contracts one we what very only important partner beneficial as

Joe Munda

thing you guys you you very know in relationship quarter can. know commented, and to to If but having I to In of I touchy mean more change if sort Mitek, between they've dictate like you it there if will Mitek, you're you one a outperformance contract sort know pricing. that structure dialogue seemed the the you more of a always worked was it's of Okay. there with know closely this drove sort seems you any you a regards always orthobiologics, been

little user of your to hope have way more any any I a seen back the being of quarter queue. in shift in So the wonder bit this end pendulum occur then sort and dictate in and you able pricing towards I'll the

Joseph Darling

contract so Yeah, really that's structure on structurally nothing the happened Joe.

the you rest way than ever, I more historically. are is the relationship Here is the the conversations like frequent, if partners call the position with depth of our check dialogs you this of the audience are the to much the I deeper they would on stronger think than been I is think and had with and

So say know going is the may very where it's back I to relationship words, would collaborative have than of and I touchy, you in your today historically. strong some it been past it more know the is

the feel resulted more from the in sharing and So partner information strategy in I had that than as with dialogue and really it our been been past. input good of us has ever part sharing has the

Joe Munda

you. thank Okay,

Joseph Darling

Joe. you, Thank bet. You

Operator

And our Springer line the of Singular with next is Research. from Lisa question

line is Your open.

Lisa Springer

I market U.S. market? repair million, you couple have the morning. $XXX When is million global just to a $XXX or opportunity about of agreement. talk questions Good the the bone about that

Joseph Darling

It’s U.S.

Lisa Springer

for the Okay product overseas? and opportunities what are

Joseph Darling

it that You we market will way given technically look typically assessment. we the Lisa population global assessments know at the for because densities, in just a the the U.S. market double

Lisa Springer

overseas And launch or we you but were would XXXX that in if to look for also Okay. it, out? launch further a be

Joseph Darling

the probably the we're want then their international to first at launch registrations beyond U.S. establish from looking markets. XXXX marks. to proceed CE the We markets No, launch and in OUS a and here

Lisa Springer

Sure, that sense. makes

Okay, you. thank

Joseph Darling

you. Thank

Operator

Our the of Sidoti Sidoti next & Company. from is question Jim with line

Your line open. is

Jim Sidoti

Good morning. hear Can me? you

Joseph Darling

you? morning, how Jim, Good are

Jim Sidoti

Good. Good.

on that and in do to was come First confused payment, the delayed Why payment it you future was Mitek like period? very business with seems expect the in strong milestone little quarter. a I'm my the the

Joseph Darling

light great a shed and question on some I'd to that's that. Jim, like

the very, great, closely worked a that would okay felt take that of more we was conservative So close is, a we at days when this to reality saying the hit. so risk important And year with think the milestone end approach the the of we point. was few too very was within it

So probably XXXX in is the will reality not bleed hit into XXXX. and it

Sylvia Cheung

more this mentioned, potential that of and it the Joe the prudent and exclude per And our year. update conservative the be will J&J. analysis the of the timing input to achieved latest is as year's J&J's our expectation not it's we partner end the from feel risks profits, end surrounding just expectation. internally And because quarter with from outlook also towards our we of part that As milestone

Jim Sidoti

And an hiccup then just was sense. month, affected on from you makes how the of you follow-up us the the question sales last CINGAL. that by indication international after FDA? give data international sales in announced Can were news Okay, there any

Joseph Darling

relative of of study. effect of we CINGAL, to the the Jim, international an did XX-XX sales results see

physicians fact the scratching have with results never the heads with that saying can that In steroids U.S. conversations outside are us their see I share of front. you like I've on types had and they those

they're still use CINGAL. So continuing to

of heard at haven't We consequences any point. this

very So with still our outside the U.S. CINGAL about performance we feel strong

Jim Sidoti

Alright, thank you.

Sylvia Cheung

Jim. you, Thank

Operator

Our next question is from Mike Petusky with Research. Barrington

is Your open. line

Mike Petusky

Hey, good morning, guys.

Joseph Darling

morning, Mike. Good

Sylvia Cheung

Good morning, Mike.

Mike Petusky

I Sylvia, morning. around Good modeling. guess first question

quarter know looks of over half margin second sort half your been all based more margin You that or level? down coming something between commentary, quite the the maybe place probably quarter not is of second but the XX% on that suspect the the in to maybe and the first first fair, like in growth in XX%, quarter of I gross first and it's

Sylvia Cheung

fair. that's you Mike, the for thank question. Yeah,

HYAFF HYALOFAST, a had this recall, items of non-routine we and a you voluntary products, of or one-time our The year including of HYALOGRAFT-C first as recall couple quarter HYALOMATRIX.

write-offs As a mid down to to we the added reserve result inventory product from XX% sold some high-XX% which and of a charges took of gross range. cost some led our to margin goods significantly of historic related and that,

of of We year. this that are XX% that result or showing put second first we achievement quarter from which some plan pleased the seeing improvement are quarter in the place since outcome we with is the the of

guidance for where we that second we internally XX% out high the continue will netting are the better certainly Looking round outcome. half But year. from to And we to standpoint, that the feel we be of comfortable the feel year, year guiding full the on we level able for at high XX% path. will a is we achieve targeting full up somewhere the where believe around

Mike Petusky

of of that rate you rate it kind effective was of Okay, in great, the super kind you like first I subjects, the also tax about know then more a second normalized is year half in what be for helpful. tax had would this half related effective guys just And half? XX%-XX% the assumed

Sylvia Cheung

we a call. a quarter of point, CEO's tax for as CEO the related equity good namely to the talked first also expense, or transition situation result or first former The the Mike. couple Yeah, nonrecurring quarter, charges our second about effective during had compensation activities the in a loss infrequent of the in non-cash last which some we rate have

some around in exercise was the included not of During from expect magnitude order why million of related and the do helpful the be which QX the also not low also typically I the you. tax down. we standpoint, employees we rate to of expectation an and second and XX% order that QX. options half impact they employees consideration, the that's tax smoothing stated./ when drove the from events out hope year option of which timing and stock exercises of about look of quarter, QX effective QX into guidance previously second magnitude will we have stock benefits So an tax X.X the the full range project taking reason the year rate And for XXXX we at the were

Mike Petusky

Can for one is. just think I more Joe? in It

Joseph Darling

Mike. ahead, go Sure,

Mike Petusky

and a labeling really here back want. want and and I labeling outlier, sort guess I million data and pricing spend this steroids clinical behavior you you with isn't I and about goods I that want still get that package to think few hopefully can do of think go know you product have with kind said be you may really impressive kind the the know to So not of guess an more you that get of why you product to if the the the almost dollars and was know here go the CINGAL, kind you the for a pricing you Joe, work the steroids, of I'm ask more the that approved. why sufficient guess wondering you view? But where of you

Joseph Darling

were Well is of – and it as part the part question the strategy. good it of the view as it overall that view, the actually the very is evaluating but first Mike of part all, is a of and it's consideration

you to with do know the them. You do sit FDA. We know reality is we to get the down need with need that

know title FDA commissioner to more of put guidance be You And summer public out either was device more It's to know may interesting fall. a in was end a put new there room early was there products the talking release fall. yesterday you it guidance combo the of out was the and in because about device the due there. the the the out product into that information, or of it's move, products

the outside here. think outside the interesting the a as you approved look U.S. approved, is device And where really been U.S. timing been that's CINGAL very as I has So at

So we're looking every angle. you know at

I amount to of assessing of really to availability the forward unfortunately in such do the in to the meet of an strategy dependent bring It's the the here product labeling fashion. trying expeditious for this doing think optimum on FDA us. with we're and delegates right best the

we're with bring compiled, So XX though FDA. so have not is as we're to as to a data week compelling meet has the pushing that soon them the package hoping been completed, feel will hard as we the study

Mike Petusky

approximately? you FDA's expect Just XX data a really quick when press the to to follow-up and be able on do that. that release, With week

Joseph Darling

is the plan don't totality important. know the you press We all that because feel releasing we we're information capturing, of yet,

before have So a and the single in the FDA, about we I the right, FDA, talk point get versus if the and study. with I strategy of don't information important totality we to in the that conversation pre-release deep want think the we a around the it's will down you results just go sit we

until the any after So with we don't at intention this point FDA. releasing have of meet we

Mike Petusky

gotcha. Okay, helpful. That's

much Okay, guys. it. thank appreciate you so Really

Joseph Darling

Mike. thank you, Yeah,

Sylvia Cheung

Thank you, Mike.

Operator

of Wally Walker from the Capital. with question Hana Our comes line Road next

Your is open. line

Wally Walker

morning Thank congratulation quarter. good solid you, and on

Joseph Darling

Thank good morning. you, Wally,

Sylvia Cheung

you. Thank

Wally Walker

about to the sure relative on to of make revenue half, first revenue saying half Question the and morning. that if that in be I your XXXX, correct? expense will half Good second the be be on just second correctly. that you will saying higher, am what Based it are higher is the thinking relative it you're lower production first operating XXXX, is will in to half

Sylvia Cheung

correct. this yes, Wally, is

Wally Walker

have. I Thank that’s Okay, you.

Joseph Darling

Thank you, Wally.

Operator

a Analysis. for have with Joe follow-up do We [Operator Munda Instructions]. First

Your line open. is

Joe Munda

thanks Yes, follow-ups. quick follow-up, for real the Joe, two

growth. is, the question, place each trying to some figure the guys you outside meeting the the by pricing moving much, total half are around growth of with versus just is well orthobiologics the to growth in how orthobiologics question a you product bit given schedules here about quarter. do be other I them? off components know meet caller's as with there? you rates know a still amount those time out their And on of pipe down. the And driven are of comments in transfer given little guess already and back the Sylvia's last FDA as There you have other of Just products to the color a or coming going

Joseph Darling

we as other in working I to going am QX. definitive going Sylvias is we the date. take process of questions, to are We take that for FDA, and half discussions the part nailing a have speak Joe. on but are we're in that We're targeting we don't with for date, down

to? want You

Sylvia Cheung

and growth to franchise and within in growth key your expecting revenue for the double regards would drivers, from a the XXXX. digit standpoint that the growth products. driver we remains and MONOVISC orthobiologics particular I with say question So CINGAL are biggest products about Both the

revenue Now is of And had flat announced due roughly product revenue earlier in we voluntary have we full which recall year. recall that it expectation year, and total one, course the X% been stating you said was a about of for product we primarily this XXXX. the if that our to;

to on those QX, year we products. on we three QX, the impact have end and of shipment between the shipment While target QX, resume suspended remain of by

but to will recall helpful on of I dollar revenue that the company. the fiscal in franchise the in forecast Secondarily, for reflected see main both looking U.S. remaining to pleased talked see in the our basis to increase gross a year-over-year at is we impact hope for due franchise, be moving and and it's in XXXX product contributor the a we it about dermal market expect erosion and viscosupplementation growth. relates franchise stability are been that in the price the MONOVISC. revenue standpoint from that There down understanding ORTHOVISC terms as has And related a pricing to the quarter. QX we second a parts that is not will voluntary sonic

Joe Munda

there. Yes, that's I'll then it extremely helpful, it. Joe I and last And one appreciate end just one

issues about a back the itself products. it's to doctors bit timeline enroll, the you a what component talked pipeline reluctant give key to I as is HYALOFAST of randomization a trial to the know little I little bit is You some could is and guess pushing on in of color HYALOFAST there, going

curious I'm concerned? of little to So a what's HYALOFAST as as going far is get bit on color just

Joseph Darling

great patients me as as I way, process Yeah, of it's Joe, as lesions know it's that larger are it's in put part you get upon as and up you is When get what you not question a is that it through, that. you not followed is that more know you lesion the fact, microfracture microfracture so necessarily coming let randomization for depending what glad the larger am it well, become attractive small happens lesions. any arm the with as to when in

we're So it's a with lesions. are ineffectiveness feedback to in randomize coming up especially U.S. that larger trend due the that from they microfracture arm lesions, to that's of where the of part microfracture the sites up our side larger as reluctant with to seeing

Joe Munda

that, guess that and to how you I get resolve well? Okay so some you of if do hurdle how pass

Joseph Darling

that a advisory input on there's be think I our going is, Yeah, talking we're process. things. board couple One to for of to

we think I a these Second, sites manage relationship. to closer at working tighter have

some sites to also know critical. of these with think that the aspects the different of is of I lesions you types education

better these larger as about best a with increased and talk the microfracture improve by until the now me sit it. until a way perceptions get now on which around of, focus things of doing meetings ramdomization the why with everybody we the tell you of current ASAP. we back randomization true several the to can So can comfortable right we'll more that's that's base the better product of get management more these sites, just given and the of sites we down we we're environment their either to But that I perception is to perspective after had give really arm. said knowledge Right there lesions. would feel are we do I can

Joe Munda

Okay, thank you.

Sylvia Cheung

Joe. you, Thank

Operator

turn the Joseph call showing any not over to Darling. I'm CEO questions, further back I'll so now

Joseph Darling

you you. today time Thank Thank your all for today.

proud results have of we our organization are proud We of for financial the built. very the second quarter and

to strategic forward our Thank plan and we this and coming time months. the in additional a excited As morning your five we are about for about you look prospects, we to details sharing our years the initiatives the future, have day. great look

Operator

gentlemen and does may this disconnect. Ladies you conclude program, now the

Anika Therapeutics (ANIK) 26 Jul 182018 Q2 Earnings call transcript