ANIK - Earnings call transcript Q2 2019 | Anika Therapeutics, Inc.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good evening, ladies and gentlemen, and welcome to the Anika Therapeutics Second Quarter 2019 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] As a reminder, this call may be recorded.

I would now like to turn the call over to Sylvia Cheung, Chief Financial Officer. ahead. go Please

Sylvia Cheung

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

review During XXXX second highlights, were financial I earnings our business quarter summarized key our in today’s and release and call, which Joe will results issued today.

website earnings release Investor of our the is Relations in the at available of copy A anikatherapeutics.com. section

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

Please turn number to Slide two.

defined certain made and Exchange remember we and certain conference statements in Act please of Before uncertainties. XXXX. as are based and during risks beliefs the statements current begin, and on our These Securities call that to this subject are expectations statements constitute forward-looking

future differ about The or factors company’s information could affect see results that more achievements. actual any could materially our results, SEC for Please results. performance our filings anticipated from

will and measures how views measures a discuss helps our complete performance. gain this our non-GAAP financial call we which measures. providing We investors financial Certain more of understanding these is are consistent believe results that on financial management

results A available website. in is GAAP the reconciliation Relations calculated most of these in non-GAAP our accordance with to and the of financial comparable presented GAAP measure section Investor

call over the our turn Joe? now will Joseph I to CEO, Darling.

Joseph Darling

continuum positioned therapies. a orthopedic Welcome we company medicine to to earnings In quarter call. evening, commercial Thank continue across innovative regenerative you, products and XXXX Sylvia, into Anika the and to the deliver our quarter everyone. of second good transform second global

in evidence and XX% the growth International our generated cash We're as international year-over-year. our in the also realizing We Viscosupplement by commercial expansion initiatives earnings quarter. strong from Revenue benefits flow

Sylvia to-date for strong updated will our full year of result raising my detail XXXX. guidance following EBITDA year of the revenue outlook remarks. and in performance adjusted are a discuss we As our our

turn Please to slide three. number

initiatives, with on our commercial and to this of have the U.S. Before I [Indiscernible] start clinical, ongoing innovative the forward important our quarter update other move analytics business efforts to in like we I'd bring to discussions and market. discuss decided CINGAL treatment after regulatory, to expense an

conduct our design Initially use of with we that study discuss sort we be pilot which trial III probability and the trial program will coming its will Phase and cost a to trial this FDA and months. the balance the tend in success pilot that generate the believe using newly we in approval. design, needed We risk to confirm data approach FDA clinical to best time, increase this our will protocol ultimately

In the analysis to we decisions. reach these conducted

demonstrated growth considerations real continued and by performance CINGAL evidence One strong across the in of world of most our important and Canada was the Europe.

clinical to CINGAL XXX,XXX and in reinforce receive year-over-year overwhelmingly XXX% with safe non-opioid CINGAL's quarter. International relief. value launch feedback to the second revenue physicians and provide from increased from the with as our confidence procedures applications, success since positive durable continue a fast in patients further together has in solution we This over

market in benefit the physicians. the treatment Additionally, elevated The the results treating over need, this clinical U.S. for recently with new research conducted opportunity patient we the XXX primary underscore U.S. market and

out which evaluated estimate market among have products in increased opportunity, multiple is most the of be new in $X treatment these outcome U.S. survey The indicated described our CINGAL's the we factors research. All the be likely approximately billion. to confidence to that CINGAL

primarily the the to in hexacetonide enroll receive The across pilot patients study CINGAL; randomized is either placebo. or expected XXX approximately triamcinolone sites steroid to saline U.S. XX

one year in study approximately XXXX and start the complete. take the half to of expect first We to

launch potential design CINGAL, sites the the While of modified criteria that including the new successful of belief watching believe patients by will it for produce seeking a FDA we the submission. our probability NDA will study confirming improve will pain-related the study outcomes is and success delay pilot the

partner. explore can process the to terms its enable be design to potential FDA be Phase to explore streamline the share we so whether in the Throughout Anika this on development an can would levers to with outcome and pilot also adaptive cost intent successful opportunities a maybe us trial. that We III trial that intent study larger collaboration to shareholders that with the beneficial strategic use,

turn Please to slide four. number

osteoarthritis which Anika we and the beyond pain addition pipelines actually robust continue management and leadership has teams. study, tissue product commercial the also In and strengthening second the advance while our to quarter, CINGAL to expanding repair regeneration executive to pilot respiration cardiology in

have by financial and operational our I focus calls, discussed are our As and company growth on ultimately our prospects previous products people, on on enhancing driven performance.

transformation. During to identify the exciting professionals to at It our levels the second is of of recruit Anika the caliper we quarter very organization. continue people all the see joining driver and right to

[ph] repair President to U.S. pre-market regional advance industry launch we the and recently directors awareness particular, Hybrid upcoming of continue sales therapy. that announce the to directors sales In bone on under enrolled have for are U.S. leadership our of board strategy our Commercial provide three we Sales. Vice pleased to and highly scaled help product These and feed for knowledge industry will extensive built

Additionally, U.S. development they orthopedic commercial will support be hybrid which therapies model. will utilizing launched our the other in in also currently

to international under to sales international portfolio. also President international distribution we've expanding performance focus International to-date, aggressively our network leadership of of our continue for We global product reach three the Sales. Year Vice sales a now partners on the added new

the the a agreements are multitude and number registrations of countries Europe, product near-term, America. in on Asia and to we In track finalize of within South

growth the have We all with across countries than our through are stakeholders on international active a XX improved actively where and driving increasing key focus more interactions we presence.

veteran Vice our oversee of our development licensing global identify global to to President acquisitions, potential created efforts opportunities of a Jim Business we portfolio and to footprint. position XX-year James and will Executive the business Loerop advance Development Planning. expand our function partnerships, Strategic and Additionally, evaluate appointed alliances, who industry and commercial and newly is

turn five. having to evolution. slide number is in point its Anika an Please inflation

We U.S. in our take hybrid commercial control ability are for greater to future our model. of the confident

noted previously, Anika that expect I to model. As yield for commercialization a direct hybrid this will compared we as benefits commercial approach full significant

profitability us drive usually large significant approach penetration This more sales will associated the and to force investment from with without market building us enable revenue internally. rapid to benefit stronger increase growth allow a

categories. most we as believe model ability and the scale launch to optionality the We will this across provide multiple products

visibility, and product of and volume control predictability We fulfillment. demand, will greater also benefit from

launch our U.S. The this model. for of in surgically therapy quarter will our procedures first of repair upcoming delivered bone first commercial launch product in be third hybrid under the XXXX

Our directors sales hired preparing recently actively for are the regional quarter. third launch soft the in

directors scale intend potential and their drive to move continue sales parallel, to we U.S. leverage uptake. sales commercial and we therapy. distribution launch, full to local this partners forces to with will established evaluate partners utilize orthopedic we initially As regional rapid market In for

we Medicine surgery am in International recent began the Please the and very turn slide American Orthopedic conferences Cancun, Mexico. product Knee number called Arthroscopy, at showcasing industry repair six. for meetings Orthopedic bone the pleased hold recently Sports to Society of announce Society in including and at here Sports I Boston that Medicine

gain for launch. with insights They clinical as we relationships leading and prepare the continue physicians building

encouraged positive input and very this and from look as constructive the We the influential are forward these building by we thought receive approach feedback we to leaders momentum launch.

the under quarter. the following our U.S. quarter animal be prototype second rotator therapy the launched We second hybrid as for will expect Product first model. completion in product repair progressing and the our continue in development the pilot in of refinement a we is study planned commercial

we half multiple on instrumentation the the rotator product the therapy. and instrumentation. this focus gain will year therapy In reviewed insights surgeons the we meetings surgical note, to design optimization industry Off conducted of in-depth at of with the on for interviews the and design we recently cuff and second

and repair XXX be and repair bone Anika. to be U.S. XXX rotator and near We cuff growth XXX estimate opportunities to XXX term categories market market repair million to cuff to million. represent bone million large million attractive the rotator the Hope for

slide to turn Please seven.

During FDA enhance trial probability work with and accelerate our in order to the the enrollment Phase amend HYALOFAST the for success. to III of protocol the quarter we

amendment sites outside we new number currently of U.S. pace Europe the of the expanded protocol the from Through sites has adding are and the XX enrollment. which XX accelerate and the to to potential

to We our also augment received the inclusion approval patient to optimal criteria target population.

International orthopedic for on held surgeons the Society at Preservation Regeneration HYALOFAST recently Focus an and Cartilage Meeting. Joint educational we Additionally, symposium

billion. a to we U.S. to of see high patients treatment. be market HYALOFAST very and this regenerative which We physicians for enthusiasm estimate among conservatively level than represents more another $X.X significant innovative opportunity continue

our broad technology lies increasingly can future our areas or solid proprietary medicine other highest HA the that regenerative believe of leverage we in We in where utility platform.

steps pave those and now key that taking We management will new shareholders. control for enhance also of know we're the that for patients help commercial and the value line. physician products product over Increased users, our way important

September number sharing day years XX analysts Boston. in our investors in valuable we to There five details on and here are of forward our a and ahead opportunities of strategic look at plan

our evolve across making with organization second and a our pleased very are global results we We are company. progress quarter we as into the

the results. to call over Sylvia? Sylvia to our now turn review I'll second quarter

Sylvia Cheung

for quarter number for million Slide was to second to revenue compared million of turn Please the second Joe. quarter you, Thank eight. year. last Total $XX.X $XX.X the

orthobiologics revenue. franchise strong global quarter viscosupplement $XXX,XXX primarily the due grew Our to international approximately during

total revenue quarter of X% occurred transfer market of year. second Global impacted the represented by decreased that viscosupplement the the XX% were revenue pricing for viscosupplement the ORTHOVISC and The quarter year-over-year decreased fourth in during U.S. second MONOVISC approximately product quarter. the last And prices U.S. revenue. quarter

calculated prices by transfer basis a in MONOVISC period. during This quarter selling royalty As and were partially impact end U.S. reminder increased user two in-market quarters the arrears. which was the on offset a based is ORTHOVISC pricing net revenue of the prices in

end percent a sequential user range. and the ORTHOVISC MONOVISC basis, around high in digit net increased single price On XX% sales domestic sales price net quarter increase

and U.S. net X% for offset MONOVISC. revenue viscosupplement year-over-year user international was revenue by in The a basis XX% end On more viscosupplement year-over-year. decrease volume for the X% of quarter for than XX% the increased growth ORTHOVISC

quarter of XXX% the Product quarter. for XX% the gross primarily This year-over-year XXXX. achieved XX% CINGAL for to second growth compared increased margin which quarter for the was revenue by to driven

was included lines. strong margin product increase result gross HA solid The inventory year-over-year primarily prior to due charges to related in product year

mix quarter. favorable the In addition, also a product positively margin gross the revenue impacted during more

cost Total partially expenses, The offset operating decrease million of and compared expenses. quarter by primarily development expenses expenses year-over-year million XXXX. the second product due were revenue administrative to and lower in in in and general $XX.X higher were the quarter of to operating research total lower $XX.X selling,

share employee diluted second due per Net the income $X.XX quarter share diluted $X.X quarter per income net tax to or in for XXXX. quarter $XX.X half the benefits of stock in to was related The million to compared of for exercises or was the option in second year. million $X.XX decrease year-over-year primarily last the

the to of for Adjusted The last quarter more primarily compared $XX.X and EBITDA EBITDA second the mix. and to million in income favorable related million product quarter result inventory to adjusted profit was of increased gross due a improvements reduction $XX in for charges increase operating revenue in as year.

from we cash We ended million. quarter investments and first $XX with cash $XXX in XXXX, half operating generated approximately approximately and the activities of totaling million in the

million of accelerated delivery $XX we quarter our an share the shares under approximately of XXX,XXX During common received program. ongoing initial repurchase stock

complete to program ASR XXXX. than first this expect later quarter no the We

drive strategic to cash repurchases. organic growth M&A on growth focused to and Our strategy to through organic topline making capital augment investments shareholders share deployment returning remains pursuing

highly to opportunities. to creating value continue the will be most We discipline capital to we're deploying to ensure

full Turning expect X% guide Based and for year information number from to X% total slide year revenue XXXX be on year. available to up prior the to-date of we results to on nine. currently around

initiative range discussed in Total quarter We on the call. high be we expenses a percentage million up the year year-over-year will is digit to which expected low third revenue now earlier result the of for pilot study $XX control for the in CINGAL cost fund range. be single internal as expect the to operating total the

Adjusted on high mid $XX EBITDA to in low is for around net $XX million the Based XXXX. to income million million anticipated expectation range range the $XX year. be a the for

year expenditures We million. be between continue million to the capital and for expect $X $X to

near review and financial our turn Joe drivers. concludes This to our to to now I back call growth like discuss the and long-term

Joseph Darling

number Please you, Thank Sylvia. turn to XX. Slide

across into look our near have second business. advantage to we growth we of the half will of As multiple the levers take year, long-term to to continue drive we

launches the our advancing model commercial cardiology repair bone of include our repair, hybrid and These cuff, therapies. rotator

the CINGAL and our on franchise international of MONOVISC, specifically HYALOFAST. focus Continued commercial expansion orthobiologics

completion in would the and and continuing innovative our commercialization acquisitions commencement CINGAL strategic our advancing evaluate including augment product our of compliment to medicine regenerative our tuck-in enhance pipeline portfolio, deep clinical partnerships and and the and program, orthopedic targeted Also that capabilities technology.

We as we organization also our execution allocation. maintaining to approach continue and balanced our operational and disciplined solid across focused on remained efficiency strong capital

there Before from take I away we things are open call three hope the to line you'll today. questions Anika that our about

significant steps shareholder taken year Anika global company value the we've coming commercial a and First, the and to in position to creation into over company years. last transform accelerate the growth

for external are we and focused Secondly, organic on growth opportunities many laser on delivering Anika.

as strong we actively leverage position We achieve our objectives. our to have redeployed world-class growth and market added resources talent

inflection in is calls previous in its mentioned I evolution. as Anika third, having ongoing And point

strong our our a of by financial when we excellence next operational evidence of and we performance to to-day growth. are phase legacy committed drive sustain year discipline As

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

Operator

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

is line Your open.

Joe Munda

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

Joseph Darling

Good Joe. Hi, afternoon.

Joe Munda

thoughts you question us my about around Could study do So, the a the think if XXX? data talked roll curious pilot that's do why perspective? to get much you on first context not pilot a CINGAL follow-up. and cost study? it's an just or study study decision adaptive Can I'm you Phase that I'm going how out then give possibility III? the do is pilot just R&D; Why the Phase of trial III to first to design. study coming that And of curious from bigger into that the study. and question you Thanks. then of revolves depending and some

Joseph Darling

previously, believe a and great of as it try and in multitude we each questions. trial balances of best we to intend we'll I this risk. okay? support down needed and had potentially First, one, address cost a approach ultimately design Yes. pilot approval. our time, there trial III program mentioned to this Joe, questions increase And use It to and probability confirm be in and to that data Phase our FDA generate success would break

trial there that pathway coming with were decision We factors And in the number to expect the forward discuss the our FDA with planned months. a to the solidified on design move of CINGAL.

from CINGAL. by One the continued revenue international been is we've encouraged that so growth

The highlights XXX% As call, Europe performance during CINGAL both strong mentioned in growth by real-world the Sylvia across year-over-year XXX,XXX us product. demonstrated and evidence since the of and launch continued I in increased it and strength of further procedures the the to second. Canada with over the

competence to So CINGAL's a as has and nano-fluid and continue meet to reinforced feedback together our [ph] to positive durable solution the the relief. we from with fast and physicians receive patients in value further safe overwhelmingly provide efficacious clinical success

need underscore the In and interviews in We that over market elevated U.S. additionally, results the opportunity to market Joe, add the I'd treating physicians clinical and that. this from XXX like survey treatment research patient the with to with to recently primary benefit U.S.

factors billion. in U.S. increased which to as on All opportunity confidence CINGAL's have of be call combined approximately the our mentioned market I $X these

NDA enable Joe share study of selection potential design While opportunities successful Throughout with collaboration to to produce will of also partner. and the we submission. is improve to we explore beneficial of could of intend the potential by for that launch the including confirming it outcomes development the the the that terms FDA our CINGAL us probability pain-related also seeking this pilot will criteria strategic study Anika process in patient believe belief success the new modification would that delay

treatment now to this it that our in clear to the the efforts to was is market some all forward bring over moving questions type. And the U.S. your it innovative this to decision. cost of financial to right turn of of this, I'll to us Given related address Sylvia

Sylvia Cheung

Yes.

think the pilot CINGAL the to design is parts, other cost piece the two other one related is study. I the adaptive and

revised will we standpoint successful the the has. in meeting design trial the my believe trial FDA that For that requirements do be design

months. is next are intention One to particularly revised design. there the mentioned elements is on a Our are as three design or arm. involved the few Joe a earlier in placebo FDA And over that with talk the specifically

a The criteria And arm, the of is much the modifying third is the patients to the patient arm. larger second one for exclusion purposes. meaning inclusion steroid TH profile target enrollment and

the the not in we study elements a These a generate with the I detailed questions. coming yet need single-digit cost operating included million that pilot months. discussions discussed order as FDA, that is believe to expenses the and in estimate hopefully we'll are to to but cost important Joe, the this be range conducting in we standpoint, in that be answered revised standpoint, the of earlier. we have mid high your I from data mentioned dollars the earlier the study adaptive and had From we that

Operator

Thank you.

Our Sidoti next question Jim from & comes Company. with Sidoti

Your open. line is

Jim Sidoti

Good Can me? you afternoon. hear

Joseph Darling

We Good can, Jim. afternoon.

Jim Sidoti

Great.

few pilot more the study. on just questions So

a that said study? or to complete take a You to a Is year year to it'll complete. year the entire complete enrollment

Sylvia Cheung

It's is study. The entire six months. follow-up one year complete period the to

Jim Sidoti

Okay.

be XX correct? before study. it'll that have from pilot So Is months this you data the

Sylvia Cheung

you Sorry, can repeat that?

Jim Sidoti

complete long take how will guess, to I it enrollment?

Jim Sidoti

to year complete to it Joe, apologize. take sorry, enrollment. six That But approximately will approximately enrollment. reverse, will Well, months complete one it I'm

Sylvia Cheung

Yes.

complete we'll be analysis. the enrollment take So From overall looking as roughly year follow-up. us it'll the statistical complete at to six-month well a to as there

time XX months we'll specific think roughly what frame, looking the that be at timing state at. I is So the you

Jim Sidoti

Okay.

is assuming larger you review would a you'll months the XX after commence correct? that So Is then and study. okay data everything

Sylvia Cheung

frame. the had shorten clinical discussions FDA because at Sequentially looking process. into at liberty and ways said, getting of the Having the the specific would not this we're be with that details the internally point on haven't to yet, call. time approval this that But at Yes. we we're

Jim Sidoti

Okay.

So correct? expect U.S. three revenue we least it the that years from any sounds CINGAL Is at shouldn't on for like.

Sylvia Cheung

That years. would assumption. is say to three I four a correct

Jim Sidoti

All right. pilot got any give the sense what be XXXX I us study? Okay. it. cost the can in And for will you

Sylvia Cheung

I cost mentioned expenses will -- good complete We'll digit as overall study. the The the mid enrollment the we year portion dollars. is in and starting year. high next A this of commence be to as high the in some look single be to earlier million

Jim Sidoti

clinical Okay. And partner Have you you on mentioned a partnered that might someone. you with before? study ever

Sylvia Cheung

in In number Anika's We mind also earlier on partner comes the of We with the have. was we terms clinical had products. filler programs. previously One to developing with companies later a in development partnered of history it have given dermal with in program J&J partnered that product.

Jim Sidoti

Okay.

that all the with so assume of that product negotiations a – contract distribution distribution And [Indiscernible]? I part comes or for

Joseph Darling

Joe. Potentially,

to part depth the obviously today, to public we're early today we're of that call really and But think at the those of advantage lot environment Jim, want get to really potential any of in I as stages in in take we're the a look considering negotiations conversations. on that collaborative into wouldn't I partners. of opportunity, now more

Jim Sidoti

then in or fine. That's you're be half repair pilot be the these people product like it bone it product, regional going will initial the or second XXXX? launch the of Will Who's to some of over it the going Okay. be to your just distributors? in year. selling sounds And move to launch start a

Joseph Darling

selling engage the obviously and going accounts. responsibility account clearly directly of going management into our Well, to are But sales a local directors combination their to be distributors both. meaning it's for

phase to the as selling personally it's So I'd of the see product early you'll of the sales the directors focus combination well. the be primarily say a two. the going launch of in

Jim Sidoti

the that right? the initial well. another I that like things with use if you the distributor in selling Is looks how then you'll going launch product and And it's future sometimes Okay. assume evaluate are could

Joseph Darling

Yes.

the open We to out nationally your think distributors. are running want larger forces. get gate regional arrangements of we to collaborative and the based with local point, to and product very focus sales up distribution I But on the to

Operator

question Research. our And next with Springer you. from Thank comes Lisa Singular

open. is line Your

Lisa Springer

of wonder if could decline year-over-year a color I evening. big Good more little in us cost product Sylvia the revenue? give around

Sylvia Cheung

to The inventory-related year-over-year of year QX product cost solid of decline had last requiring related was QX product One for due two in our warrant which factors. revenue to Yes. lines some in XXXX. charges we are AJ

improvement than ORTHOVISC which a higher pricing to gross expected in gross margin improvement products U.S. the product Secondarily, to for yes, much in the mix and MONOVISC the the more profit. led or also our revenue favorable the in product contributed the

Lisa Springer

Thank Okay. you.

Sylvia Cheung

You're welcome.

Operator

you. Thank And a from follow-up Joe is Munda next question Analysis. our with First

open. is line Your

Joe Munda

a And the on pretty as Sylvia, thoughts that. then gave I couple Sylvia, on -- I ahead go could and given volume. pricing Maybe missed here color of your year? good the Joe and some you guess out you pricing we that. thoughts look review and Thanks. here. Yes, follow-ups the guidance rest your over of some and

Sylvia Cheung

Okay.

So sequential from the in high and MONOVISC a single-digit ORTHOVISC in pricing a XX% the increase basis, range increase percentage standpoint on range.

of year this QX largely increase increase Mitek's QX MONOVISC year-over-year due of was So over this ORTHOVISC volume was XX%. to standpoint is increase initiatives. and volume and this year. volume volume experienced a marketing products X% sales both from our year-over-year And partner,

the XX look half the of we outlook we particular XX the saw to second guidance also trend. taking quarter said, a took months Having a account look this we noted meaning there in second that that the from year a that at at positive into standpoint, I was half historical year updated of guidance year. increase first pricing the my very we From trend, longer-term development volatility. of last previous in that was that the of increase

we and a to result more take prudent adjustment. as a So wanted guidance be our balanced approach to

half to of volume and want Overall, that believe positive continue cautious we we the very over we're ORTHOVISC toward volatility XX for in last a will the the year futures about results are XX the to given saw and we to we the it more MONOVISC that taking revenue. be the approach do second drive prudent While increase months.

Joe Munda

you. Thank Okay.

Sylvia Cheung

welcome. You're

Operator

you. Thank

another follow-up from & Sidoti Jim Sidoti have with Company. We

line open. Your is

Jim Sidoti

pricing year-over-year? what gave us you Hi. pricing was sequentially, but Sylvia,

Sylvia Cheung

to last price decreased year. while from was price year from increase MONOVISC the Year-over-year -- ORTHOVISC

in increased in me just low to the a year-over-year price to -- QX year. versus high decreased so get ORTHOVISC -- in percentage range. QX And versus last price let year digit slightly QX single MONOVISC this So, single-digit percentage

Jim Sidoti

Okay.

And gross the QX Do year the QX different types of second had you and the look so margin to QX? you to like two or quarters of more QX. in very expect relative half

Sylvia Cheung

Good question, Jim.

Our cost revenue the expectation provide into and overall of had of total them. of from and one-time would product quarters a standpoint of the expense built project separately their guidance. margin don't margin activities operating I we is each expenses to And think I the unique approach. behind the profitability kind say guidance is that the operating best keeping to gave we that

stay expectations. consistent gross will not providing product We margin with

Jim Sidoti

any Maybe in QX? could there this affected the affected in gross one-time that Were QX Okay. or answer positively items margin you then. negatively

Sylvia Cheung

I product second one-time margin. line mentioned inventory the quarter drove in in had a increase off the QX of the related that the last reserve that In in was high year factor

would lower into taken consideration, adjustment means that think year the in be be the without margin last should I year-over-year. which increase that So

Jim Sidoti

Then about in different how was in sequentially there that anything Okay. nature? QX, one-time QX sequential -- was

Sylvia Cheung

to mentioned ORTHOVISC QX we of increased mix to price that gross that is say quarter. saw X% that a our about Yes. second standpoint, for revenue due in earlier largely is the that I margin. roughly I MONOVISC QX half From product and and would to in increases the due

it have then impact. margin our continues unfavorable would half for second So year. positively profile trend pricing a more If the it will of I if think the to doesn't then impact up it

So to that's consider one QX the QX margin change. to point for sequential

charged from and some meaning operating those period other are I timing purchase The the to And expenses timing these are of QX so of are QX period half what that timing to driven. would is of purchases and and them of more utilities call certain related increase the those expenses, the they included to supply, events. of

Jim Sidoti

guess I better confused overall you MONOVISC for said both because U.S. pricing X%, year-over-year. got down for was year-over-year. Volume ORTHOVISC and revenue got MONOVISC better I'm Okay. but

overall down was why X%? revenue So

Sylvia Cheung

Yes.

QX product quarter. last by shipped quarter I the price fourth transfer pricing was remarks price that year we ASP which the low on in the piece the prepared the was the is driven and missing of the in So that down for transfer a explained was

our which a ASP But meaning impacted which product is quarter's QX, price year of So unfavorably was just component. the hitting portion from by the the royalty other revenue. was portion the impacted this QX the by QX in of low is product results shipment in-market last favorably

Jim Sidoti

That sense. Okay. makes

we transfer price move So up in gone since that price and end pricing go then to up should expect transfer that up? market now QX? has Should QX

Sylvia Cheung

price is point don't for What pricing certainly for improvement. because this of know at QX's The transfer go pricing would we up and the about QX trend QX QX.

So that historical reasonable prudent make we some on element is and that have the to estimation based trends.

Operator

I'm turn Mr. further And like back no showing to you. for questions. the I'd Thank call to Joseph Darling any remarks. closing

Joseph Darling

Great.

everybody thank First today. for I to time want of all, your

evening. and transforming strategic to results with through we great year our you global and the very a Anika as regenerative We have medicines. a are our initiatives continuing the you progress to elevated with Thank execute second half. continuing into pleased update commercial our orthopedic quarter forward We a in and company look

Operator

gentlemen, concludes you program. today's participating conference. today's This thank and in Ladies for

Everyone You day. have all a disconnect. great may

Anika Therapeutics (ANIK) 24 Jul 192019 Q2 Earnings call transcript