Amphastar Pharmaceuticals (AMPH) 16 Mar 212020 Q4 Earnings call transcript

Greetings, and welcome to Amphastar Pharmaceuticals' Q4 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions]. Please note, this conference is being recorded. its its acquisitions performance, of conference program among on are share on to of size business other expectations the other and related future ANP; commercial this personnel; forward-looking historical candidates; the of and and related and on marketing DMFs of launches, pandemic of filings such the impact regarding to including, and or operations business governments and product statements, things, the financial of growth, and statements product buyback call operations products, timing results to the other the not pipeline that are activity events, of pandemic company's of future development responses and and of All and its sales timing across market FDA operations. our backlog, the product matters the statements including relating as COVID-XX demand approvals, facts or rather based business, projections These statements expectations, and its but and are historical factors. are similar on other performance regarding operations estimates Amphastar's current and related historical not Amphastar's similar statements, as related to statements could, may, might, other anticipate, are should, potential, expressions contain expect, although forward-looking not such words. intend, all project, identify these believe, would, these continue, used plan, Words predict, will, or forward-looking

on filings Securities Exchange annual businesses XXXX. Form as year factors, ended depend those a extent particular, the our factors, of the XX, materially duration at some from time. risks, and COVID-XX's In including in the governments consumers December as of report with a including not should XX-K and assumptions pandemic to uncertain and March forward-looking those and the uncertainties Amphastar's extent pandemic, that unknown business all beyond actions continue they place result in in differ severity, in to for impact are as of Actual and predict XX, results will including You which undue on on several the or this the known reliance taken statements to may well remain SEC of the filed of because Commission, on on Amphastar's response statements involve the and XXXX, described difficult by and the number and impossible control. evolve forward-looking cases, with

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

Forward-looking even over or change. above cause or the your you. forward-looking information new Human or to available Resources only turn in future, if obligation becomes if information as of circumstances to the the events release. update now revise to will Communications. the Dischner, Dan speak this conference Vice President, Mr. events release to of statements reflect date Amphastar's in any the undertakes Amphastar and Corporate or referenced call in host, statements subsequent Thank conference no I expectations

You may begin.

Thank you, earnings fourth is Pharmaceuticals' joining name Communications. operator. Good afternoon, Dan quarter Amphastar VP call. and Corporate Dischner, thanks of for My

and Vice exciting we Affairs to the on some of operations. We today, you joining and Marrs, CFO; me appreciate clinical Peters, look President Senior very Tony call Joining Bill Regulatory updates. us and are forward announcing

quarter sales with company. to in fiscal in unit sales an Kroger. best quite of $XX.X exceptional a online compared the launch X% revenues volume our fourth in million, $XXX.X obvious making year say recent advertising, net QX, of Mist revenue sales mainly terms of it I'd we say it while and to positive, reported exhilarating was to for Primatene increases XXXX While our a digital this TV, our increase attributing with quarter nationwide history. our the radio saw for saw and on was the along reasons, year least, the and net year for like the million off, start the to an it To

reaching a Primatene's in to we to this on are goals more Furthermore, confident path for Target stores with commercial putting the result, towards sales in launch launch, company sales ad into momentum campaign. To the later coincide television the month. excited product. we add that we our As announce a are million $XX will new our reaching annualized still with ease, it

As we to of expect the have said our lower past, marketing we where percentage increase may spend, our sales. expense a in we marketing be

to person we're XX-year-old plan of goes, it's marketing. words, interested the to as the reach right use all the younger it's whether at more with we'll with that we spending expenses structure right marketing smarter expand as be a reasonable digital its our In digital, the kind the while demographic marketing level message and the to in about However, time. TV influence. or other thinking, our to And optimizing enough saying at right through reaching time-tested proven of XX poised

enoxaparin. to Turning

product increase an due the notice You'll market. Teva saw in exiting sales to the

over even like company others years, United in or regardless to continues this make integrated the leaving the the vertically long-term of and this only beginning reiterate we've our the market flow and manufactures being States and the market, API in reentering While and product entering, that enoxaparin structure Amphastar seen market. that I'd a player to ebb finished

growth QX. X no entering other otherwise multi-dose known the epinephrine vial compared product in as generics while market. some and the Of ANDA line movements XXXX notice In our we state-of-the-art saw X to glucagon, approval. we ANDAs, pipeline, vial, you’ll X With X saw AMP-XXX. Midyear, to product of see we XX% in the terms the position our to chloride year, Meanwhile, to multi-dose approvals we epinephrine respect as succinylcholine grandfathered incredible continue approved, we of remaining were a signed saw Last addition atropine. sales fill high-speed entered strength.

to the a epinephrine pricing As stated, we've an said as originally without we trend market, in upward disrupting of while our last call, we expected we're share fair planned. seeing get the

optimal balancing opportunities at market drive pricing. continue while look fact given that to our maintaining a seen upside to the share, tremendous However, with effort we've recently we'll this

this I'd continue was FDA's Report, the in to in launched of as approval scientific continues Office to first Amphastar. February, in significant some such the expect launch, like positive relying to specifically see far our glucagon's to and and of the confident citing say Generic experience product, the and we're with quarter in Regarding observing Since in the our glucagon as We're markets so XXXX very it medroxyprogesterone. product and highlighted Annual previous retail uptake Drugs launch enoxaparin strength demonstrate approval. increases This products a on in the first-generic technical capabilities of newly approval sales.

we late December, and product we the already for in received earlier of matter the development, responded in year. product CRL our On AMP-XXX the the we've CRL disclosed to previously that this

the products quarter are of CRLs amongst While year. common complex this date in often AMP-XXX, a GDUFA have we fourth like

with anticipate our previously items, to forward quarter discussed intranasal be this naloxone year. the Moving refiled we in of fourth

very due ANDA, I'd agency. our having some we've is dialogue announce filed had good COVID with we pandemic. guidance to results with seen promising inhalation which delays the half to and first to PD first We in PK anticipate studies, AMP-XXX because XXXX the year instead and AMP-XXX, of this be like our Regarding with been completed some of the

for we've gauge Additionally, Massachusetts status. Continuing this the pipeline. I been have programs of at disclose a some With on that with the to previously our of exciting path about discussed just-in-time insulin more planning the as later can and inhalation the capacity that this the interchangeable said, towards seen coincide we're XXth facility to company's founding. program with anniversary development topic building year report product of items, confidence, our additional

to Turning our proprietary items.

as reported intranasal forward. Our dialogue we this has far, a produced epinephrine and product there's the safety to the FDA. Thus study been positive results with a agency with where with clinical good response an open moving profile maintain efficacy

advantage by pen no as with form or epinephrine, $XXX against with auto-injector that of believe gives inhalation with plus injectable the us product. another pipeline retail item Concerning the As with we formulation product few ago, with long-term opportunity a AMP-XXX, million a a our Primatene, a new generics. experience so the other evidenced presentation weeks announced intranasal this in our whether compared an we as form competitive

While we next inspection or to the needed. if date while year of there we a of is not in this quarter Paragraph patent. far, infringe not filed anticipate agency fourth AMP-XXX continue GDUFA with the believe pre-approval as Thus IV first been stay a do quarter XXXX, has year we a triggered a the December we of the in XX-month upon

and on a conclude specialty-based to towards company. my portion like into pharmaceutical by I'd generics a path Finally, from the company Amphastar and that transitioning biopharmaceutical-based emphasis product proprietary emphasizing the is

year year our an businesses many XXXX where Amphastar. been down, been While slowed for niche it's have has exceptional a in

priority. resiliency, constraints, growth able finally, were our surgeries, seen. primarily and elective first portfolio, our and our R&D was imbalances to able Of also as course, which to offsetting to on shutdowns vertically historically company, often weather a to such a vertically through our a Amphastar focused we quality through a COVID rare generic-focused coupled model thanks and has vertically Amphastar and this weather we integrated robust towards thanks the owe diversified with to as the been And of to trait thanks was in intent progression. integrated integrated and structure, organically. our Amphastar path to model, portfolio, place growing sets original business sector-influence This be seen diverse adjusting

on that our company, year-end opportunities our our and capabilities, into now the development, company remains first over to thus company us turn and more to focused remain I diligent CFO, the could the specialty fourth quarter allowing biopharma products. internal proprietary based Bill Peters, from While to we financials. focused call finding based will discuss pharma foremost, and enhance a a generics transition in on

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

achieved to to strong from were the business. as we up as see quarter growth new of sales in the prior Primatene million to to some $X.X fourth $XX.X the of in pick from very national $X Enoxaparin program. benefits year's $XX.X able we Mist continue advertising million sales nearly quarter million fourth doubled XX% million Importantly, our

approximately multi-dose million for from $X.XX to fourth $X On slightly litigation. margins offset of fourth XXXX included last litigation basis, loss impairments revenues decreased to the due expenditures year approximately share clinical of compared $XX expenses bring $X.X quarter, vials. $X.XX XXXX which of of XXXX, cost to the Additionally, our as share Mist In of provided epinephrine earnings net employment income from to negative Aventis, events. million and sales long-lived $X.X per we radio quarter to during to million significantly fourth $X.X and $XX to gains. of expenses of with of launch million fourth the currency expenses from flow had reserve vials. XXXX $XX.X in exclude the repurchased per loss Selling, increased million General to fourth Primatene compensation, of of and digital television, quarter the quarter operations in equity onetime epinephrine net declined million increases to by sales million The million, XX% million. company of a million from fourth higher repurchases year's with stock due approximately Gross revenues per fourth due increased was legal $X.XX Adjusted epinephrine the adjusted $X.XX quarter for total increased $XX.X million Research X% the last and due by or and reported XX% net marketing offset partially enoxaparin cash company million in margin multi-dose expenses. a over $X.X or $XX.X or including in the quarter, in in company to reported slightly compared of trial settling to Also some per $X.X share net million to income share. year. $X of distribution an the decreased or and $X.X million adjusted from from XX% of of assets the an development the $XX.X increased marketing amortization, spending $XX.X Primatene Mist. of million. primarily expenses, $X.X the administrative million quarter Other

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

$XX state we of million this me goal year. Primatene let Mist First, expect our in to that sales achieve previously disclosed

in to also continued launched Glucagon, the February in sales in vials, growth expect we multi-dose by We of XXXX. epinephrine quarter growth and second driven launched was which which our be

GDUFA and have XXXX. we to year. or growth have Additionally, is pipeline. in in million contributions $X.X our our from continued dates of subsidiary, importantly, more which third-party sales X said, sales APIs for we could business ANDAs, from our double to expect When from ANP, ANP look million to this foremost, remember and, supplier this sales later X come current critical saw That products that, please we XXXX $X.X first which

this double expectation than is will from more XXXX. facility Our third-party that sales again in

expect products. as Primatene more epinephrine gross We to high-margin and which increase sell most Mist, are we all Glucagon, importantly, multi-dose margins vials of

high approvals ANDA anticipate year. margins also that from We of we this new received sales any

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

and will expense However, to related our patent to continued earnings in dollar I it over operator of percentage as clinical but we litigation we the we X percentage challenges. terms, development now back call epinephrine. products, continue products spending spending provide as leverage. on IV turn to Primatene trials increase the X inhalation Paragraph to plan decrease trials sales and sales will This commence Research for to insulin a to for to a expect G&A advertising will the year, due intranasal decline Mist increase expect as expenses Q&A. of to

[Operator the line Securities. comes Instructions] question Northland Our of first Chiang from Tim with

had ties steady if been just margins state to you I'm I you margins. gross in enoxaparin? had margins financial It higher I'm your just you XXXX. if mean, wondering enoxaparin? targeting just where sort really what of where where have I margins curious would I -- are gross exit did you're your know excluded gross you a excluded gross question.

in we the And haven't basically, reduce I at our we the but $XX.X sales million you, we tell if future quarter, to calculation, the done take enoxaparin Well, you to which a do, inventory have sales. had what are to look that for Yes. zero. levels price have the assumed I'll point sales

inventory inventory just and $XX.X sales be purchase you commitments take in any out in we if you're some too purchase for will million be There So adjustments had to $XX.X or off. new million far not cost, it. if going

calculation that's you just a at that's weight takes if do out So it time. But at and look what that to then way to negative that over zero good it.

follow-up have next coming just one Okay. you then is And the on Got in to response Or the responded it. X AMP-XXX, CRL? weeks? that guys

as already script, responded part of have Tim, that mentioned in had the we to Dan Yes. CRL.

to at you get they of the get is do point? just GDUFA sort notification once And the Okay. any it Or your from date receive response? FDA basically some you wait

updated done, to the They No. respond year. date, is of GDUFA this have will us fourth an with which which they quarter

next of comes from line with Our Gary Nachman question Capital. the BMO

follow-up. if of then more behind key comfortable year, think of you get one maybe this color expectations. you if get just feel First, on But you it, you those there. XXXX revenue drivers do Are a consensus just have comfortable growth. how the XX% $X.XX, them? I you implies with some those together, it us appreciate little bit kinds some I of all talked $XXX of growth. the pull levels? XX% And know with could And to I with targets but million comfortable of EPS you for growth Consensus about

Yes.

to had to the we We'd Mist have to So growth. have have levels, to number Primatene those there. that the would get sales to we get

very product. have strong of which a high-margin sales We glucagon, to is have

We from have the vials. continued have to sales strong epinephrine

one have to double sales to levels. have We from other not to Otherwise, sure we'd get -- order there, point. which is about would not at something to really least this than I'm would that in that ANP, there. not contributions more And at those mentioned to I it get approved have take in at we our ANDA

Okay.

have numbers? bit though, everything So get stretch. little that, a would order could of perfectly those to be go to saying, to in Like you're that sort of a

get say right be say perfectly have to the want I would to on that get we'd would be to perfectly, time we'd don't but go we would I cycle. most launch -- ready everything the on and the first and

So things that cycle. at looking would we're getting the second be

So I assuming first-cycle wouldn't not approval. any that say we're

from a do we then products we be that being contributions that we could that and then AMP-XXX. say high-margin sales if product contributions from did have enough, doable. And early I'd So need got like that

on $XX bit Primatene, this flattened And just year, over helpful. little have quarters. getting to few That's a mean, I the sales then the last Okay. million

And durable And their you Target? other or now to So that Is at the to sounds and of that are looking with any much aggressive benefit opposed of how getting the be from going about more just this retail you're more a back got a headwind are guys with talk doctors about point? patients It that? as products there DTC going you into going year, talk from benefits much there how maybe this do could chains retail? are then COVID? be think just more see like you'd you pharmacy prescription with you to if how chains get aggressive more

Yes.

Target So at month. this full we're there a We're excited in of launch. about chain launch the end

going we're well think so digital about on they market an the which help us. well, of kind because into as Primatene marketing feel and demographic targeting And demographic, We're younger towards also really the excited different it's expanding a really We past. from untapped like weren't that. to that's of aware the we

even the that, And because so think going we have, mark. We're help grow confident kind this us. that we -- believe we the that's still really marketing $XX pretty million of to going knowledge to beyond product that's the will

right So with we're now that. pretty confident

other up retail Okay. beyond And lined that have you think do chains you Target?

the The this big ones point. reality gotten all is at we've

not sales. where meaningful we wholesalers, a have have that's And really chains boost many launched program smaller so none at chains. to we're independent We've we the that a there's launching. -- year, targeted -- But a program I last have already, and would do into think of remaining all

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

sales is? on expectation you product it that the underlying can That's is which product, And a I you believe what $XXX one. brand injectable be is inhalation, the going to And the over product, is filing? XX, XXX, secondly, say disclose number of that's that, on million. So -- then your litigated other

you not going not that where that reasonable make an have wanted can or expect on competition I all. That's that's that be is asset that this. at do Just sued is -- think that be And I -- to have have a product on? been competition to sure you to sued any or

Yes.

second question, me or one first the a of start is That So all, AMP XX. that challenge. Paragraph let is

time in is the up April. to sued So be

today, we So we time been to not AXX, going that of since that its inhalation we to the fact sued, not. as have want hand limited what or have the a but it's kind we these disclose is given of want are because sale And of at what our a time we've as number this potential Paragraph don't frame back challenge. is, to disclosed IQVIA to products, sales the it what IV especially inhalation, don't tip

What's filings said Massachusetts to Okay. in facility. And you're year? regarding I to on expanding You next the sneak a accommodate the expectation just the may pace if then capacity pipeline follow-up your of inhalation pipeline.

think that as how of go should about pace we So we of in into the filings? XXXX terms

X Yes. filings per X to have subsequent We that expand to then the and going to to into years, X X. hope year

the from next comes Raymond Wilbur Our James. with of question Elliot line

of couple questions A XXX. on follow-up

a against least file, ANDA? So But has first applications if application? to to you this are I'm window, would the you're believe innovator litigation P the statutory IV is curious you. there at Or that be still a pending this already one XX-day or commence which filing, within

at any this not of other aware We're time. filings

performance-based the competitive seeing be the here orders Lilly. anecdotes, drawing volume a the it's kind little know of respect And you launch, what but any to that seeing early on with bit strong any in latest terms future from other trends from I Okay. data, away given response and of weekly in you're products? And glucagon, then glucagon may

for or not, don't strong. if hard Glucagon. clearly say they're other really know that to have Yes. But we initial Lilly's we're sales products we're because response drawing will going It's any from are but glucagon to substitutable say I where

at way the the we're -- of this time. happy with rollout pace the So at

next question our from line the David with of Steinberg So Instructions] comes [Operator Jefferies.

to at Looks glucagon, My end fourth market it of on is first of launch question. up. just really or just question week of regard about already. tagging like you've Elliot's to the started fifth heating prescriptions the in XX% looks captured the February, With the share like

but you that that allocation, Bill, the product of regards of traditionally, would peak repurchase, this it assets so. And that in they've to probably can't you cash. you been the a that range capital drug with reasonable year. million even or any repurchased always you've And then with purchase stock to and used million $XX development? multiples. generic $XX fact of of made the have I know that would Given could think you for share $XX so pretty to or acquisitions, are trajectory, to of be million the divestitures been business that find sales have about mid-year sporadic, though said, worth late low Does or hit be you you just and Where lot significant acquisitions but pretty for

So peak. is, to think one, $XX think, we as $XX million the range good the first a a to about million

but the we've things, those target the before years, carefully few help looked to we we important hasn't say, the the to many I not doing us, that, for So I'd a as did been and right us. in get not at thing is, looked fit where And up does most probably for over us fit else things doable strategic as of at X X.X the where us. future? ended and in fit the things, the this acquisition multiple. does the acquisitions want than at it we us year last far things go, for months the the range anything because is thing couple multiple a very We've more in that be there? But that. main that's right And looked as It's as been last think and a

[Operator Instructions].

& question Serge from of line Needham Belanger comes next with Our Company. the

questions Primatene. of on couple A

Target Kroger? seasonality First, just you especially distribution do that the about what sales, represents? business side talk of Primatene then something closer to drive or you spring? it And to Is Walmart this can expect any

first on than size, has of fewer So Walmart. Target significantly all, the locations

Primatene, we Walmart so kind the we as were see formulation we and big And sales, it's with at customer. Walmart us old now. the where and CVs of was when our lining biggest right really way Walgreens really, looked X Today, for in that's of up the

we Target our the an important -- the and I segment but large X to level a fastest-growing think biggest customer, same expect online, is customer not to So to are be I'd as think like what we And on our today. though.

we're headway making sales. So online

And on seasonality?

to Yes. our it and a that again, time. put On been online around we've and -- just o’clock we seasonality, our selling up haven't able it's graph it actually pattern since been today we updated seasonal one X:XX see

So up before started. call the it just came right

that some If a lower, to that you weeks hard right seasonal see higher I trend. upward and that. it's are that trend take a was are trend obscured and And a There's sales the in huge was -- direction. look everything year COVID, overall, discern of at got moving weeks that, spike that The you kind was some but else. last can got still are only in an we've

-- but right -- the that we're we'll on hitting of So now. up anniversary

able year. be to this at maybe we'll point, better trends this so discern And

And already peak. almost that we've captured

too we're loading when off not pantry far peak of So that occurred. from the

significant is manufacturing the it's any some any facility facilities? there of are your ongoing projects, undergoing still in Chinese CapEx -- of expansions? terms expansions in U.S. then And And

undergoing Yes. Chinese a still there have The expansion U.S., significant CapEx big -- as the is a facility well. significant we in going requirement. some also But with projects

facility it inhalers our alluded increasing we think to for we're metered syringes. of capacity of for have the dose ramp so that added Boston, ANDAs for out at And we our can pen up also we've Armstrong our our earlier, pipeline. Amphastar here capacity demand was the I outside that in

we other both to part of are capacity we're -- important long-term future to meet to have we're future, So program on. part also the that's approvals as and forward looking And coming significant well of as vials add in syringes. capacity we in that going going working that to insulin to our be some Amphastar the prefilled

increasing number XXXX? from that So is

increasing to spend high want for maintaining relatively say don't it's CapEx as expansion. of we I say look that level I'll a XXXX, future from we're but

And with end Dischner question-and-answer that, And turn call remarks. of the any to I Mr. to our closing session. for the back we’ve like reached would over

to exciting thank everybody advancement I XXXX. Amphastar today wish I the you saw next us stay and and catch for in forward look in want time. joining to Alright. want safe, to sharing that we'll and to XXXX everybody

And today's concludes teleconference. this

at You time. and your a this Thank may for lines your disconnect participation, now you have day. wonderful