Amphastar Pharmaceuticals (AMPH) 28 Feb 242023 Q4 Earnings call transcript

Greetings, and welcome to the Amphastar Pharmaceuticals' fourth quarter earnings call. [Operator Instructions] Please note that certain statements made during this call regarding matters that are not historical facts including, but not limited to, management's outlook or predictions for future performance are forward-looking statements. These statements are based solely on information that is now available to us. We encourage you to review the section entitled Forward-Looking Statements in the press release issued today in the presentation on the company's website. Also, please refer to our SEC filings, which can be found on our website and the SEC's website for a discussion of numerous factors that may impact our future performance.

We will also discuss certain non-GAAP measures. use measures our U.S. reconciliations on information of and these to Important may earnings our found GAAP in release. be note Please this conference recorded. being call is

begin. Our Dan, now Corporate Dan President Bill Senior Mr. Regulatory host, Affairs Executive speakers Mr. Mr. Operations. of you conference today Dischner, I of over Clinical Dan your will Vice Peters, President Vice Vice the Mr. Corporate Dischner, Communications; CFO; of may Senior and Communications. Tony turn Marrs, President are to

Paul. and joining afternoon, you, us today. for Thank you all Good thank

BLA This filing which have On CFO Clinical or the the XXXX $XXX XX% by strategic Vice segments revenues, of net Tony includes development by Bill complex our portfolio. strategic This call with results driving AMP-XXX. Earlier interchangeable our of fiscal to year in notable with and an me acquisition on the our financial product while momentum Executive and announced further increase for across is XXXX, million, a increase a Operations. Throughout will surged impressive compared for our first Finance; profit in remarkable a and in high-margin be of previous our core Peters, remained in seen President Marrs, Affairs focus and President Executive gross Regulatory biosimilar net increase offerings year. our substantial XX% XX% we recent BAQSEMI income our highlighted today, annually. Aspart the representing of Insulin advancements Vice growth and presence to bolstering our

experience BAQSEMI, products epinephrine, hospital demand suppliers. and MIST. diabetes driven shortages our our other our and branded product, our to injection Primatene is by heightened dextrose bicarbonate, glucagon attributed clinic alongside to portfolio other within growth notably Our continue sodium as use our products, recent amongst and such addition of Moreover, [indiscernible] high-margin

demand for year. glucagon We X revenues, we use clinical we our XXXX, sustained products. expect our launches to drive hospital Primatene anticipate injection, and this to anticipate products and continue and a towards BAQSEMI potentially Looking MIST product

our uses filing our proprietary of We This its our forward in date second a inspection, progress marking quarter. undergoing excited or preapproval launch for towards intranasal a about GDUFA REXTOVYM, regulatory track are is upcoming remains device; AMP-XXX the our process. on a teriparatide, for step naloxone, which

second As a we And ANDA, for AMP-XXX, million agency's XXXX, the which was the in goal with received an according delay AMP-XXX, GDUFA first we favorable commitment in product XXXX. $XXX the a of inhalation indicates to our of date presenting robust, agency the ongoing this filed a GDUFA this despite There fourth market a year. status, in dialogue The quarter paragraph exceeding which date. IV priority AMP-XXX first [indiscernible] of pursuit opportunity with inhalation GDUFA the demand quarter as in have contender is fourth IQVIA. a the in date determination review quarter At for of ANDA, have remains generic market in this ANDA. a our a

from transition Lilly as fourth totaled figure million the by updates for $XX.X continues impacted in the factors. the a seasonality and on of slightly BAQSEMI, anticipated planned, As progress sales quarter,

start March. beginning the pack took is shipping United transfer X-pack marketing we October. in the expected, as began February We BAQSEMI of over and the at U.S. smoothly States one in As going the the shipping in of will

of complex application main our robust and generic trajectory at manufacturer Aspart but biosimilar BLA the commitment a we market will this towards our filing, take our leveraging will believe and proprietary we regulatory affairs demonstrate also about with significant on of XXXX. Having our pivot discussed diabetes impact our of interchangeable Starting product our discussion nuances performance, quarterly our we the portfolio, to products. want Insulin only from U.S.-based is our us continue remain securing status U.S.-finished the pipeline worldwide the drivers advancement in landscape. move This distribution forward, to Lilly concerning I and poised insulin firmly proud revenue not our optimistic for strategic aspect throughout supplier. mark and to over Looking aimed our to capabilities. This competitive and apart solidify being an position increasingly as sets biosimilar interchangeable [indiscernible] as a

need the insulin with for we insulin products advance. this development continues or pave including and surge, Insulin diabetic development, M, insulin way AMP-XXX the manufacturing patients to site. Furthermore, currently meet to for poised affordable continues more are believe AMP-XXX milestone our our success As in options will demand we Aspart degludec, to AMP-XXXM other U.S. for human of this recombinant which

or the ANDA on to known significant topic filing our intranasal GLP-X opportunities continues as looking this for on our development our and reference while strategic epinephrine diabetes of by remains sustained AMP-XXX supported product pipeline, AMP-XXX, this development Amphastar remarks ahead, has to In in our front product, in of the initiatives. through track stages. Concluding a Additionally, and progress us, proprietary various growth year. my

and the are trajectory. our AMP-XXX, candidates With REXTOVYM teriparatide, about of promising like optimistic launches imminent we and AMP-XXX,

underscores diversity annualized potential. performance resilience growth the of and our Our signaling portfolio,

Peters, the quarter injectable capitalize year, results. this would headquarters financial the insulin to President to efforts our the facility, our expansion complex our Moving Vice our our our API our year-end at is R&D to forward, our turn discuss our engine capacity CFO opportunities. I evident at like Finance, dedication planned continued and and pipeline Executive of be completed which over AMP our through and advancements, and growth and anticipated to our within on fourth is expansion at facility, call inhalation our Armstrong expansion is which Bill company, to to of

increased XXXX to strong quarter remeasurement were continued on distribution spending expenses The fourth competitors, by review shortages $XX.X foreign in a which demand. Primatene was of $XX.X continued due the sales gain quarter the million $XX.X to quarter to showed million of the XXXX capacity from product XXXX. efforts our million to quarter Lidocaine in income the our fourth due the on on of $XX.X to million million our MIST finance back the to contract glucagon fourth long-lived at show the quarter sales our nonoperating the mix In an of or debt up quarter of of due This from in as marketing China. Gross was quarter growing growing and than atropine, fourth quarter of an Thank for API and product sales revenues quarter, and up increased XXXX sales transferring its $XX.X in million with with XXXX due of BAQSEMI on tax of period. fourth year. Adjusted rent from to earlier marketing quarter XXXX showed Sales to $X.X to to million currency. The the sales which sales regadenoson in MannKind, to net the in income to contributed with structure. exclude positives order. Other XX% related quarter reserve XXXX this of the net by million costs. suppliers of cash Primatene the fourth of $XX.X the fourth X events. of foreign $X.X quarter the offset currency sales strong comparable $XX million million, for onetime $XX.X per sales $XX.X million were for of had that MIST. usual from of materials tax $XXX.X to increased expenses delays products expansion rate the of of compared as General $XX.X full higher-margin in or quarter $XX.X income and began amended $XXX impacted $XX.X for the we lower and were from in operations share of higher approximately million, by rate for updated from able sales of to expenditures to the combined were company detailing the end and international inhalation unit of mill the sales Lilly's $X.XX compared pharmaceutical BAQSEMI we due we assets and to per XX%, chloride, which API at based $X.X increased earnings you, $XX.X from inventory fourth of company compensation, prior company as BAQSEMI share, increased beginning was glucagon quarter cost programs. Nonoperating strong $XX.X of to October. Lilly's to required during from million previous of the an amid and increased $XX.X by calcium the XX% provided the our sodium quarter, of to year company expenses operations bicarbonate to adjusted the fluctuations development of year's million was Dan. medroxyprogesterone in or period. X% and million. in per facility the mark-to-market net in our and in million to sales net expense the amortization, current finished million, year's lower million $XX.X increased of $X.XX of positively in used year [indiscernible]. Selling, and process from fourth an primarily other XXXX the $XX.X Eli flows million XXXX up share in These sales, quarter $XX.X administrative net million primarily of reported BAQSEMI our due the BAQSEMI-related million million income as increased approximately launch XX% Epinephrine due to $XXX.X million of million. flow revenues compares stronger of year, swaps. XX% like of interest less sales net $XX.X compared service cash recorded increase XXXX income previous XX% as of $X.XX expenses, and the in and million to of from fees ganirelix, revenues to -- X%, on million the transition margins X% $XX offset XXXX the fourth per a which from from of to decrease prior adjustments Research product products partially The of injectable of $XX.X impairments million quarter of Glucagon fourth recorded are and $XX.X production respectively, in previous to due million and from for $X.XX discontinuation share. growth interest insulin sales acquisition, expense the equity or fourth adjusted the growth and in $XX.X $X.X reported million the supplies in to XXXX, million partially

Let in We the look fee to BAQSEMI continued the assumptions of selling a we few growth Eli due financial of me difference be as coming are review will anticipate for the wholesaler the and will unit drive year. growth Lilly. using beyond. the slightly to XXXX in Amphastar we single-digit price between impacted that structure high range. Average to compared sales

As hitting for in $XXX forecast Primatene million of our sales MIST, are we reiterating this year.

X launches up launched REXTOVYM, to the which year, are product in We will be coming including this weeks. forecasting

We AMP-XXX and approvals in AMP-XXX, XXXX expecting teriparatide. for are also

goods recognition of We the shift the in goods statement. We've from cost with are sold sales BAQSEMI the goods revenue primarily thus in cost slightly with income of the the X-pack of for February, already to BAQSEMI shipping one the began to begin typical will network first the this we economic expect Italy, and net be of of to in on foreign converting throughout Last shipping countries and the our gross accounting benefit where we begun remainder pack sales we cost States, of to March. transition the remainder country due increasing net both United of margins started line the booked States, of distributing which sold, XXXX. lower the week, outside BAQSEMI beginning of United also by X distribution in at one the in

due increase to selling related to and BAQSEMI. Our efforts will expenses marketing

spending G&A and associated IV BAQSEMI increase expect legal associated challenges. expenses to Paragraph We patent with to due expenses with

supplies to candidates to plan we We our Turning fees to and this our year on inhalation FDA product. as clinical insulin and materials research spending filing development. on up ramp increase spending and intranasal trials, and portfolio epinephrine of purchases

our align increase in to double a we Armstrong year this capacity our with continue pipeline anticipate for project significant also at as our capital our to We products spending development. the inhalation facility

year, an facility, Additionally, we capacity year. complex we significantly expansion production our plan process project complex will API with Amphastar as We ingestible for ramp increase from major a our expansion to in at begin capacity our are million we insulin this on significantly finish operations. project cash up X AMP reaching this the in insulin which expansion major of the our in year China will At to facility of to [indiscernible] this more this $XX opportunities. Spending XXXX, will and look years. finance plan flows but

use call will At million our of back due same buyback questions. portion utilize make cash for the to June. year payment time, program. We a operator the in this to the now I'll Lilly $XXX over cash our we position to continue to turn the stock to our strong plan

America. [Operator Jason Instructions] Bank from Our with Gerberry first question of is

Gap] [Audio

product been able is our getting customers the and for and a issues be over But [Audio the appreciated the and Gap] back and customers reality quarter, we've been FDA. had online to, shortage supply another of now. have these able according was there's there's where that there us think get to we've some XX because we shortage, from is, that. years that. for that to I Every be to Dan that or been what our And communications supported

And in was Those of the and think said selling BAQSEMI February, on countries of going are marketing already one-by-one February move United the started program basis. yes, remarks, X-pack already in the And Europe my that's the start as in in in of rest the as is planned to I question in transferred I -- we selling well. X-pack BAQSEMI, March. the going care a United States to United States. taken and Italy, we're in States going the as in the second the in

Chiang Capital Tim Our next from is with One. question

growth. be should benefit figure just single-digit basis? a you for single going question know I to indicated mean, net than for growth the figure digit up economic expect the economic is sales that forward quarter-to-quarter modeling you forward. more had we of that I single-digit on BAQSEMI the a I going benefit sort on just net be

the the States, What planning of in looking I'm Eli So it sales at. talking and in BAQSEMI XX% March. And as $XX to had to more transition that like sales of up the level sales makes I United that's actual of that when is we mentioned, in BAQSEMI, X-pack of the we're transitioned quarter about level, the which -- million? we're to referred February, the the to X-pack in was I Lilly

rest for So will and the from quarter. quarter of third we transitions And third the the going until the occur the U.S. that's to first mostly and quarter. the countries to be mix on a Italy. still is other the of both NEB the world in our expect The the -- of most remain regular for most of NEB sales

year? expenses just it you and then I for sort peg to see. And going too forward. and of marketing this selling ballpark higher marketing of rate sort increase mentioned sales Is expenses a early

Yes.

said revenue. for, are around to costs spent which that is we've the what going XX% to similar what be is of Lilly So SG&A increased

if at of I a that to something So think be that look BAQSEMI the taking in that's revenues, of is neighborhood increase. you're range going

once And one you you'll ability Okay. obviously, that in in generic do meaningful is which I second share are to maybe get you question, that AMP-XXX, market mean other some the there sometime think companies quarter? pipeline just get in approval teriparatide, have the market. existing

the is be generics we've the same you market a expect it time. other has expect that said What candidates. Yes. X that generic sort multiple at from of what would as to we in

there are But people do other are recognize are us. We it's approval. that think -- we -- there So it's for a that significant. got yes, we still opportunity market

Amsellem from Sandler. next is question with Our Piper David

went questions. is So AMP-XXX, a underlying getting I happened the and action in and that few across pipeline your nothing know what there. finish line? has confidence it the came

there? And first-to-market it the you So can I'll on opportunity it what about then clarify or is ask what I just luraglutide can it how GLP-X. confidence a then extent and to interactions are it just talk that look relative gives thinking your first-to-market inhalation the up. Or you're want indeed something you is that straight guess Is else? with product more XXX, you the on FDA? business? And get I a is and opportunity, margin going the particularly lastly, is guess to to it that, overall to like about the I just

for thanks the David, question.

any movement. that. For the today information our of as yesterday it not to or continue for positive AMP-XXX asked view of They We any us product, we as data new with have discussion or agency. new have as

about understand discussions So issue. and it. have we that we We overcome issue with optimistic with continue try and just them is with engage they them. We're work as them just the to to what feel

perspective, our we from optimistic So it. remain about

or IV the one, so for become likely for is known. decided it's a mentioned, known to that, or future becomes whether through -- And likely Paragraph AMP-XXX to that IV as And And on subject as the well. subject but in market. our will that at it's also be is, after point a what be we Paragraph had the first so is molecule filing, to second the to we litigation, haven't AMP-XXX, subject one third not-too-distant it's filed, some to it's process said Dan it also haven't not the possible GLP

I If Okay. on follow-up XXX. ask a may

but So you no characterize it there's as here. CRL an "issue",

of should comparison. any good just a that sort just So confounds at we or thing a is this is as one-off complete -- that attempt that interpret --

Yes.

I think maybe it's just a one-off issue.

and try with we we issue, they're the keep just only that this then one holding our engage is issue engaging the understanding very keep to And when to up an the discussion, application. that overcome. that, pressure, trying positive. And they're just that them that thing keep that we to relieved, should address believe -- have have what we that's think But that issue it's once that able them. is it We be we it's think on is

Glen question next with from Our Jefferies. Santangelo is

a Bill, BAQSEMI, could gave that's XXXX but I of more a revenue help modeling in have I can place to any you I just -- mean pretty level a different was out have obviously countries clearly your of the this of a time, on transition about follow questions. and. help same to think give want And little maybe in that's high would XXXX then going at couple bit you a frame going curious from I of on Because helpful. I to material to some terms your just us maybe us TSA and on impact expenses to follow-up. over how that color it's sort you and modeling a and perspective be kind up at fan throughout if

Sure.

it's a So too. actually confusing to little bit us,

XX% So internally the come budgeting the say of either be just that partway we're go that -- no there I'll from but expenses straight to NEB with way net The -- as from what the income the here's States the year. is and and know same straight the mentioned, and just we're part of way. impact transition the revenues sales is this is I going United is we that assuming because the we making BAQSEMI through we're

the our very there's same be money slightly the will same and income be to -- end -- top or up that's sales but that So of amount we at revenues will know be the will of going [indiscernible], spent amount same. being the line the

is it's sales be the the countries half at I Then So in and that it. going for in quarter, only is come the quarter online about to of sales third first the of transitioned of will XX% of not most XX% But the rest that's of with the half the would of it NEB quarter. the way look XX% worldwide. being of

sufficient answer and the levels inventory of versus So get I we most Lilly some Part I -- inventory inventory Amphastar-labeled sure of either. products to us feel to know don't have we to launched. transitions of for making don't the because and that with know, these down could exact do exactly this and has free -- date winding follow-up labeling

So it's dates we bit a process, either. have confusing a exact of so little don't

and All But a maybe first little a right. some sizable more my Well, here you've wanted Do as in, the we BAQSEMI maybe in product launches year. 'XX 'XX. those much in and glucagon. I the as just pretty gross off-line. posting launches the growth I quarter? listen, should as us discussed, Could maybe gross about the you this impact explore color to you into comps slowing on growth follow-up, said Obviously, in on margins glucagon stiffer as X more we little be a of down of late sort product to about margin? couple the exited of give you bit all sort been ask get we enter phasing players that new bit and maybe of think just trending now expect the And direction of market as can these

Yes.

has glucagon tougher of So now. comps things. The couple are a

big upquarter. posted now we've last the So

So trend. that's of the end that

we So we is having X/X with more for that glucagon have coming is like we of are shrink our more expectation and product products to anti-hyperglycemic take do much think for -- continuing years. be gone diagnostic, -- anti-hypoglycemic going X/X that market better to for that is now that and market though over the and being to BAQSEMI, the see as what which share

portion that the declining. see we So market of

glucagon However, Canada in as we we the mentioned in launching briefly our product mentioned think are presentation, we now. I

is of States Canadian the the should about it some Canada be the business. about XX% the by United U.S. is U.S. So And in to that decline way -- offset the business. decline of pickup think

that from decline. have offset we'll the So to

GAAP BAQSEMI, we decline reasons Canada mention bit little which the just think growth to goods last cost of back didn't we going the in that have on by -- as gross a of item of offset we of one Then we glucagon basis, because and for the is year. the So U.S. will a we're not business. have -- margins didn't a

impact. that's the biggest So

of going The year of GAAP again, a back intangible we'll to second have impact the full is is amortization for biggest BAQSEMI.

line adjusted pulled decrease much, gets for probably [indiscernible]. And across pressures. our the overall, not we're that product very do we cost then Now have some out whereas seeing price

So products. there's those slight going decline to for some be a of

can these are margins those should newer the gross of REXTOVYM average. that some and we once though, launch of have Now above AMP-XXX, all and corporate products, XXX teriparatide,

So those will margin help that all out pull again. gross back up

there's forces on ways margin pulling year. definitely So different that both this gross

Belanger Our next and question from is Needham Serge with Company.

that on shortage about may look for opportunity First secondly, question, that of GDUFA? just there's the a quarter you capacity additional how can the at your What's teriparatide. capture I opportunities this on materialize? then to to level year? And that market of able like does whether ones And guess couple outlook have talk approvals? your will for if been the confidence other ones you second been now approval you've and take remain,

anticipated another be. provide they products, product there in shortage may on it our of capacity these Yes. one several issue. in invested long It's seems Back quarter of to the [indiscernible] It some -- to Bill or expanding back, IMS. we reasons will but a is like shortage one has need opportunities, manufacturing take to create happy to up. We're I the have somehow. happy pick yes, We're mentioned these these that at time. we come don't have it when probably shortage we think that for one some they a and of We

at about And in We're we going expansion what around future. definitely is capacity. is probably as $XX to still we're of why forecast -- in So look our similar That's that. for we million think that always the teriparatide. I scenarios see it ballpark

performed which a the to addressed, in mostly Yes, that we that we before. confident nature remain CRL we performed, we and related study this studies

remain So for the about optimistic approval we that.

And X as in are that new goes, now opportunity there generics. market as far to the other participants

margin, seemed as But see come So will the further ours. relatively even is X not but and high price still significantly crowded, has and that ago. said, that we market and relatively this price as down high opportunity, an down months as pretty big has a a come it's still definitely opportunity with product so a good it the

this floor closing are There hand at to to comments. I'd like for questions management any further the no over time. back

to the with the I REXTOVYM today's about We're we want thank and in Have with the upcoming day. other great ahead launches call. on updating teriparatide, a all joining you AMP-XXX, like opportunities AMP-XXX look next all you excited and potential forward us call. to for and launches

concludes This conference. today's

disconnect may this Thank your at participation. time. you You lines your for