Amphastar Pharmaceuticals (AMPH) 12 Mar 202019 Q4 Earnings call transcript

Ladies and gentlemen, thank for standing by, and welcome to the Amphastar fourth quarter earnings call. [Operator Instructions]

I'll now say some forward-looking statements. All statements on this conference call that are not historical are forward-looking statements, including, among other things, statements relating to the Company's expectation regarding future financial performance, backlog, sales and marketing of its product, market size and growth.

The timing of FDA filings or approvals, including the DMF of ANP, the timing of product launches, acquisitions and other matters related to its pipeline of product candidates, its share buyback program and other future events. other historical and rather and its Amphastar's operations not Amphastar's based projections are factors. business performance related historical current and statements facts are but on regarding These or similar expectations, estimates

Words words. such would, predict, or estimate continue, not potential, forward-looking related belief, forward-looking will, expressions intend, contain project, to other all should, statements, identify plan, these anticipate, expect, and may, as might, could, similar these are statements used although

forward-looking on are statements they should to not reliance You uncertainties beyond that undue and known assumptions predict cases, risks, difficult because unknown control. some place involve impossible Amphastar's and, and in or

Actual result Amphastar's Exchange and with those for of the filing as Commission. a results number including differ a in statements of materially described in Securities the may factors, forward-looking those

website locate at the these the through and on at reports can Company's www.sec.gov. http://ir.amphastar.com You website SEC's

no Amphastar to future, available conference subsequent revise the the information update or cause or or undertakes in release events above obligation press expectations information Amphastar's becomes to reflect events if new circumstances referenced in call change. if or to and the

sir. would to turn the ahead Jason Shandell, conference I President. Thank now Please go to your you. over like speaker,

speaking fourth Thank I'm on Shandell, the and to you, appreciate quarter you us joining have. our today answering We is with you today welcome and you operator. may CFO, name call earnings look by President Amphastar Good My joined Pharmaceuticals call. any Amphastar. to forward afternoon, Jason of questions Bill and Peters.

financial strategy complex growth on by execution and you key pipeline. a operational in Amphastar position strong driven had see drivers year continued financial and is our long-term a our and results, our As and of of focus can from strength,

more XX% operating and show Primatene by and which percentage approximately of for $XXX increase revenues $XX.X Mist cash also X% Primatene competitor sales our products than from million, as to gross high-margin our due of Gross margins Our other XXXX approximately to year-over-year strong Net by activities increased total Mist, portfolio, continues million. critical profit was our $XXX to in a to our XX% demand driven sales. net strong more provided shortages. increased as continue by XXXX to to increased million and than care XX%

We to expect this margin long our term. and to expansion development on allow in that us continued over and shareholders focus greater patients to research even continue believe investments deliver trend will our pipeline and and value the

quarter announce FDA in Since accepted our dates last to earnings have two GDUFA happy the I'm of fourth has that the ANDAs, XXXX. which call, more

We is the $X.X sued size XXXX. ANDAs of have based is for IQVIA Lexiscan. now the approximately regadenoson, certification months One and IV file ANDA XX for data the a by we seven with on which the This with of triggered which products were stay. a XX market sponsor, a targeting included brand the generic ANDAs of ended agency, on months billion December XX, Paragraph

to rate increase the through of momentum marketing we Walmart in continue XXXX. And product a to strong November into continues consumer as greater strategies. at Primatene The sales launched we increase MIST awareness our

on call, our began the cable Mist. Primatene July and XXXX television about return advertising has been in in on on traditional consumer investment. a earnings awareness effective discussed saw we As extremely last We good very television campaign building advertising channels

our very across strong viewed programs. widely push retail season all prime, our strong sales beginning winter advertising Judy, on arrived Price Dr. partners. advertising commercials allergy including networks, Therefore. combined major other with cost-effective TV the shows, we slots of Right within that January XXXX, of This Phil, yet Is mild national targeting an the in many in earlier, to and broadcast Judge due resulted The same-store recognized expanded airing

XXXX have quarter more began XXXX, before of of as TV airing. the the than week sales the compared to to XXX% Weekly just store increased week the was first third fourth by quarter which last as the of of

We with the are continued of effectiveness strategy rate the this large very about partners. trend maintain excited discussions an other sales, achieving our positive currently of long-term $XX advertising on continued retail Based retail of potential our are revenue prospects XXXX. Mist, and by we store brand, of of and the Primatene in guidance in annual million

a strong strength the injectable This manufacturing the approved at announcing that be IMS capacity the FDA of our IMS. another our ANDA We production from recently for up facility. expect demand which We in sodium greatly increased at for driver in to supplemental for new FDA our manufacturing our issued our facility XXXX. our press revenues bicarbonate, in response and is products our validates approval IMS scaling our to further product in increases state-of-the-art line products capabilities release manufacturing

products, revenues significant for which source the Our a for will demand be us will products high recent provide of approval critical going us our with capacity help meet care pipeline and future forward. injectable

in XX With to epinephrine to CRL day. a and respect in ml the ANDA, we business responded vial one agency XXXX received January minor our

we are quarter confident date XXXX will we As a of GDUFA a that and receive approval. result, have in second the

Regarding has CRL three with January XXXX in responded FDA QX our to complex XXXX. the cycles product, the agency, which in been we the through review injectable and received

needed.As for this GDUFA earnings XXXX have depending injectable second the has is meeting agency that or the QX we competition FDA had for a had have inspection dates quarter in We another to patent GDUFA earlier mid-cycle product the complex have on a file review new with discussed we a on off this call, never ANDA a its productive is and in another complexity. pre-approval XXXX. our As product QX generic very we result, and if date last year due with a

recent clinical ongoing. FDA our direct tools, result With strong determining QX in is FDA on agency, insulin trials respect and in including the our previously we required. the not characterization remain would Furthermore, expected. achieve studies ability that save molecules the to hopeful thereby human using purity the significant complex product. immunogenicity communications that recent to our sooner insulin for we to of interchangeable status the time determination guidance based analytical expenses have would and products, believe our guidance will be our and FDA first than our insulin XXXX we market that programs, allowing Based began and with on us enter of This

agrees is CRL FDA's later naloxone general agency the could with month. scheduled Turning NDA, of intranasal we to that confirm advice this this issues the the identified agency our we've we've addressed all If letters. to agency the resubmit year. addressed have with and purpose the meeting we this a The meeting in of all for that NDA issues the

the the labor I of facility on Finally, in would this XX% the Amphastar. to coronavirus have like impact returned to contracted has work over China employees thankfully, our time, force the none and our address chain to virus. At of inventory potential previously the planned API intact we as negotiations trade as African up Furthermore, had we starting is supply swine of disruptions strategically an material our built well flu. for and related significant from of China

years efforts of As material we a result California located these starting our API of and have inventory at least facilities. in planning two

finished be supply disruptions should of operations our States, the further United should instability. the in to our products insulates which Furthermore, So that related global in the commercial impact from operations manufacturers, emphasized Amphastar the it Company's not US. coronavirus all commercial

over fourth the financial through call turn will to results. quarter Bill I to the go now

you, XXXX the from the to Thank $XX.X X% for decreased $XX.X million fourth in Jason. period. year's Sales quarter of dollars million previous

$X.X and sales into we chains. Importantly Walmart our million surge last Enoxaparin in achieved $X to had the in fourth large the very shortage enoxaparin sales in of million market drugstore all year. dropped prior in a as quarter temporary a quarter Primatene product from the fourth loaded other $XX.X Mist strong nationally as of orders resulted a year's XXXX in from dollars sales million national

from Mist. revenue million margins and marketing quarter the quarter expenses of administrative in from XXXX, XX% Gross margin distribution to as and of fourth of Selling, due decreased $XX.X such Sandoz sales subsidiary. expenses XX% expenses $X.X the television and XXXX radio Primatene Primatene to increased higher $X.X XX% products on of $XX.X at and lawsuit Mist. of improved development and Momenta for increased General from marketing expenses expenditures to to due million API $XX.X since revenues XX% spending fourth we for clinical trial million from in products increased of June and Pharmaceutical to associated million legal due increased million dollars Nanjing development primarily Research decreased $XX.X with million XXXX. inhalation to in with our Amphastar settled expenses our

an last adjusted per $X.X last net million include $X.XX net the a XX% loss the cash quarter $X,X by net compared share we or million income reported fourth operations income or year. million $X.X reported to fourth adjusted year's share. fourth of compared earnings Company flows net of In per per impairments had approximately share The to share event. compensation Company or amortization, $X.X million or approximately, of equity provided exclude per $X.XX Adjusted quarter, of in or The million. of quarter $X.XX income in $X one-time of

the company $XX $XX.X the million. year over approximately million During the to stock bringing to repurchased the quarter, total for of repurchases

a are few of review we using look financial assumptions we that the to Let XXXX. me as

be approved which growth by year. and later to be Primatene or one We this expect driven may ANDAs, two sales Mist

for from sodium supplemental the bicarbonate, effectively have on already the this the modernized sales capacity manufacture newly of shortage our Our which for to pre-filled syringes, allowing in us many boost year by increases gotten are which drug a approval ANDA of facility.

$XX opportunity shipping room begun for sales new that already the this from have approximately annually. products and million product these shortage We is believe

from believe to subsidiary. will time, sales growth A&P XXXX. party million booked A&P double third sales from additional sales we year, And expect in $X.X than facility this our that business. at We in we come more our from this Last

we new higher approvals. Primatene margins anticipate We we of sell margins our expect as from Mist high to gross increase and more margin ANDA

increase advertising selling as rise we Mist. for Our will expenses Primatene distribution plan to our and

a advertising percentage earnings the as leverage. will to of However, provide decrease Primatene MIST expense sales

of as We could on sales expect matters. percentage to spending decreases legal due lower G&A spending a

as dollar of increase percentage research spending We expect terms development and a continue sales. in will to both and

As one insulin the two have to ongoing increase continue at currently work clinical and R&D and trials A&P inhalation we our facility. we

I and turn operator over for back will answers. the call questions now to the

the Instructions] Market. from Thank is going Nachman Gary And [Operator BMO question from Capital you. come first

Your line now is open.

How Primatene the in much for It's Rafay And on comment of evening. trending Gary. overall? was good you reorders quarter? are stocking Walmart then how on can Hi,

Sure.

for then. was So since just under Walmart $X continued orders from seen and stocking them we've million

So it's going well very there.

vials, if and you're And potential that about Thanks. approved, of still opportunity then how from expectation? had the that share market April. market indicated, FDA epinephrine by Is for And I response a we think then the we previously could get you the should think end targeting. the

Sure.

the for of date yes, we said GDUFA So that quarter. CRL. were minor we've that And respond within we to day second one a have able

And the opportunity, so when the and of generic out you to we in market. the share be that do does will come believe market April. sole math, of have we reasonable a should terms And that

on Thanks. Do you next couple any anticipate the years? competition that additional of over

say. to hard It's

you. Okay, thank

And from our next James. from you. comes Thank question Wilbur Elliot Raymond

line now Your open. is

on Hi is Lucas guys, Elliott. Lee for taking this for questions. Thanks

of So think do you be Mist, we XXXX? sales force Primatene what on terms should expecting in

that we and run said we've Walmart, of of this goal year. expect is stocking far in year million and of our in under we $XX had rate sales million What just quarter, targeting growth $X next the that the million was $X fourth significant we're so for

given. we've the So parameters those are

Yes.

fourth those commercials my on parameters, we with and January. in started airing beginning the television just as in in network the just So remarks, million I've $X prepared quarter said

push with we've growth So the seen. the that that continue think the launch television, mainstream into will Walmart at and the rate we

appreciate you Got it. really could if comment I would [indiscernible]. just

you're couldn't sorry, I'm this breaking hear that on end. we question, up

think you the and could medroxyprogesterone? the Do trends on [indiscernible] you also for comment

Yes.

fourth see quarter constant we those being So the from XXXX. fairly of

Instructions] [Operator next Steinberg our David And comes question from from Jefferies. you. Thank

Your line is open. now

Two questions. Thanks.

here And us you of SG&A, a ramp to should this products mentioned it. timing You higher more last is this done dates multiple related phenomenon? that, up, in about you for know just of rates dates have million will $XXX up this give DTC, quarter? Thanks. we the mentioned the million you've is quarterly expect for Curious, branded of ramp With quarters. like you generic. $XX be looks two two then don't GDUFA TV Or run each national it in the large in And currently kind year-long Primatene. these as you that secondly, color some current have SG&A? Can on the the them? GDUFA a

Sure.

investment this although it continue And want So was think will and broadcast as very saying it is return advertising terms the has effective. yes, cost we my year. in in think on it's the The to of been prepared still television, really I remarks, TV throughout And I we again, a continue. push, national the do good.

the targeting slots. we're So advertising prime yet cost-effective

we And the of I'll So that. with to will terms Bill. G&A, in turn continue that

Yes.

selling, So really are line our from -- And I our said that this break selling in significant Mist. so dollars seen is those -- growth all that. you've as we earlier, advertising have to some marketing grow our the G&A distribution And Primatene we we've year. or for growth that relative going to out

a that drop. will as sales However, percentage Mist Primatene of of

getting the So cycles. fourth products talking that. we about did on last complex And without first we've while for CRL competition, that's in terms pretty a now. turnaround That's generic of the on call, And the review been about through get three leverage talked fast undisclosed we injectable we the earnings that in had will quite the quarter. then the one two a one been

assessing we felt at predicted which did. And that And in point, respond that we were that was we very confident January, we would it and just we addressable.

And give specific don't is a we so the year. QX GDUFA it this date, but of result as a date,

another With the on that there file cycle then inspection one was was This still needed, first was to other is it QX. be the However, that pre-approval if recently. review. would just respect

of competitive does mid-cycle one through a So a GDUFA that had and QX status. have is meeting. meeting that productive because We and date got it lot the review very generic clarity

on response we are a to the in quarter. second forward that looking So

you. And Amsellem next Thank from Sandler. comes question David from Piper our

open. is line now Your

Thanks.

give X. your on but I contemplating and joined on generics. you're to potential any anyway. late, color this in which on movements your products and this, mean year a thoughts on filing sensitive Primatene. impact something is or this on So product extension this Primatene, be is Number that maybe inhalation are and pipeline the more Number update us then in on so demand now pipeline distancing. what inhalation X, of period I promotion restrictive and that's file this I portion missed What social And inhalation Is your to going some later Thanks.

Definitely.

San your facility. order can Primatene or that it's point retailer, either and with day of online to or there exciting. coronavirus, the very the demand, strong can. the start as let's even we is doctor's fact we're yes, office a So into up are quickly to this counter a over much their people go buying age into Francisco, seeing really reluctant I heard that Primatene, they very your in mean, hospital and actually medicine as go local shortage of people are just you to

only as asthma the increase competitive season. an due we and seeing inhaler. over coronavirus to that So and to interesting been the we a of a there's related we is increase the the we demand. in do it have panic sort is are believe that and allergy advantage early believe mild Also, the winter But counter

at relief have So to your this avoid asthma. need of intermittent go and the for temporary doctor least can the see you

respect then expenses. our about know to has Bill with clinical some talked of I portfolio. And trial the inhalation

targeting have and filing And file are trials so we we clinics any clinical in of right and ANDA two generic now they're in still products we are And currently inhalation do year. ongoing going the on inhalation those, don't trials. ANDAs this have through actively that one

Thank Okay. you.

comes Company. from Needham next our Thank Belanger you. question And from & Serge

Hey, just Tian a on for this is I had Serge. few.

in the for think just ProAir the approved recently FDA first late February. I So generic

for near are or Primatene compete get to or regarding do updates discussed other wanted Mist, Primatene term. other might thoughts this point? terms how that in then of have just And online maybe on I retailers in additional any even this you the stores your with So sales at impact being

Definitely.

brands generics. interesting me want one. address the first, that XXXX, to Primatene XXXX prior was early let So. launched question late approved the Mist after an authorized it's because I and Well, emphasize in

on generics. So technically, the there authorized generic for have been albuterols market over

I'll benefit a because go real because our the year not have Again, to need doctor, for there market you is only product. need CFC generic we think here the to were really been impact do the technically strong not is the on you has over to I during So, prescription back and and phenomenon days promoting not was $X and this of even a still not is when sales do our Primatene albuterol historical actually $XX million. there had

to coming the over-the-counter have updates And available. definitely are So, and with retailers, only we we for quarters. respect we other confident the still Mist, Primatene several currently discussions with inhaler feel that in should in our with very retailers asthma

thank you. Great,

like now would closing call I President remarks. turn Shandell, over back And for Jason to you. Thank to the

you, Thank operator.

stays I get to everybody is is a our to sure going on the through world we difficult again make safe And to I joining been basis. with So of what continues go-forward thank know with this to grow and sort for we and the Amphastar just today. providing it. coronavirus. recently deal want and it's that we're facility want to Want strong time us future realize a very in forward everybody look China to and updates healthy everybody and

you So to we'll Thanks talk everybody. soon.

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

may You disconnect. now