ADMA Biologics (ADMA) 26 Mar 212020 Q4 Earnings call transcript

Good afternoon and welcome to the ADMA Biologics Fourth Quarter and Full Year 2020 Financial Results Conference Call on Thursday, March 25, 2021. At this time, all participants are in a listen-only mode and there will be a question-and-answer session to follow. Please be advised that this call is being recorded at the company's request and will be available on the company's website approximately 2 hours following the end of the call. At this time, I would like to introduce Skyler Bloom, Director, Investor Relations and Corporate Strategy at ADMA Biologics. Please go ahead.

you financial us quarter results XXXX. thank discuss afternoon and and Biologics ADMA for everyone, for this joining to full-year Welcome, the fourth joined Financial Officer. Chief President Lenz, I'm Vice Adam and Executive Chief Officer, Brian and and President by today Executive Grossman,

and remarks the Adam fourth the press results. opening update company's for full-year XX, and ended Brian our today's questions. fourth a call, summary www.admabiologics.com. comments XXXX provide an December Adam provide provide up quarter brief will During a some website financial issued Earlier before will on release will financial your call The introductory provide is some XXXX today, quarter and corporate available we then at release the of then detailing and results. overview year

which comments, we future our the to remind call with today's or All press the Private implied announcing subject those in statements statements. Reform call are detailed and or expressed cause for may release the to risks purposes results constitute represent our Before we Securities differ forward-looking of XXXX. Litigation the making will materially assertions and beliefs you such Act formal in uncertainties, SEC, forward-looking today's the actual which expectations results factors, this as I'll filings from by such under intentions, during Harbor begin provisions be statements concerning the company's that forward-looking events, Safe that of

statements refer which subsequent federal factors required I'd to over not specifically as could Adam? a and conference date results the today the our cause relied securities of section important any to representing addition, date. the this notice differ file In upon expect on represent annual XXXX section to statements should now any report disclosure any these issued by of laws. to views our that update forward-looking disclaim as Form of to any discussion we in this like forward-looking be call We that, of turn Factors Risk for We With Grossman. such obligations our views of materially as you we from the except our XX-K, Adam to recording release and only earnings this as following actual statements. call

Skyler. difficult most commitment you, everyone, Despite due to in for customers and of stockholders, safe. revenue the of Good joining to enormous part since was This expansion line year remain on us dedication of unforeseen year and, you patients continue hope focus afternoon, plasma-derived call. for and us those Thank of We who this were with XXXX therapeutics. treated to delivered thank challenge, and the most unprecedented importantly, businesses was today and the and for healthy the Because an ADMA's on today's pleased nation pandemic. network, the XXXX multiple are lifesaving its ADMA of Biologics delivering our a XX% supply chain XXXX that revenue report it which achievements, together of million, we taken in ADMA initiatives, including record objectives been the over of as enhancement rapid represents as XXXX. our regulatory inception. top strongest plasma with center well on milestone, a production $XX.X to all as ended collection position has workforce, our increase joining

assets strengthened substantially On totaling and million. balance we our with front, financial the sheet $XXX.X ended XXXX

recorded receivable grew we plant a we increased as the million, during inventories experienced and As equipment. investments $XX.X significantly balance accounts our year-end and XXXX, well our throughput property, in production evidenced increased by as to of

the that persisting of accordance things, social rollout am state, stimulus in successfully Although ADMA plasma state different to packages, plan. operating government a products and to present backdrop the due its navigate collections measures by report proud and pressured is to, remain COVID-XX producing other for distancing ADMA, vaccination evolving I continues for industry, combination to including among

continue will and country. and plasma rollout remain operational fully as see to across we centers stabilizing hopeful continue are of improving collection vaccinations recent collection All the our we periods, trends which over

B commercially hepatitis donors with to approval Our are with It easier we materials FDA business hepatitis robust long option approvals immunized immunization regulatory experience ADMA announcing improvement and to that access a unit, we of of These vaccine. global Food FDA our well identified to an a fractionation chain testament third as will noted Korea parties. to to to adherence approval announced our approval of standards. for available material forward source should lead B for retain of items. collect the and it plasma Nabi-HB from B areas ADMA to sale Ministry inventory to raw this plasma continues of plasma to hyper-immune or this be raw Korean collect as licensed to program, Safety time Drug enabling production recently, for supply Most and South newly into allow by monetize inventories implement built the certain hyper-immune the have company's BioCenters hepatitis selling

one initiative another As year ADMA optimize received plasma our raw Earlier the License various unit, facilities supply. enhance stages aware, in center at collection approval plasma development, operations BioCenters year. we February, approval to pending center. or many you presently material for this second of Application plasma collection now including are network in half of business our and have BLA and secure, this and a this is key FDA collection corporate facility further And in expand of seven Biologics we

will XX emerge XXXX. ADMA and we achieve to ahead than revised to remain of XX two immune building Additionally, our our from X third-party contractually we on from new produce ultimately highly and our globulin end-to-end the having guidance growing plasma stronger integrated expansion globulin manufacturer have approved facilities to to profitable We during we we well operational becoming supply quantities combination of specialty XXXX pandemic by or periods with committed expectation contracts, believe goal current forward-looking operationally to therapies. of supply the track is Due and In progress, file to by an continuous of immune and schedule in facilities FDA positioned XXXX. our ever. for expect BLAs more of centers fully

strong rollout the long-term intravenous intermediate be plasma-derived Our first-time revenue us of our year expected during XXXX. for BIVIGAM achieved calendar third-party our the more, is guidance commercial which supply in globulin two allows ASCENIV, agreement, execution million peak with to of first products, or immune to provide full and together $XXX fraction

achieving forward-looking first the later no Our and outlook XXXX profitability also quarter us progress by to XXXX. than to confidently commit enabled of

longer-term firm expectation our milestones targets, quarter-over-quarter to acting and to we successfully face confidently us believe throughout these related beyond. of all the to XXXX we operating to operational to the while proud continue revenue our safeguards ahead. will of that customers, In headwinds achieved through the addition in to medically these reiterate the all say for collectively generate recommended commitment we growth decisively employees pandemic to enable COVID-XX in our enact patients, which navigate and periods I'm

sustaining we staff dedicated counting the to of us across Our seriously. quality what each high in provide on our do products. life segments country are Patients business take

keeping its a Our focused company composure this mission. for in your of and face result ADMA focus is performance team true global a I and adversity. the with of during thank the pandemic unified

that lifesaving for to With Additionally, I'd provide continued support to of Brian like to for our your products shareholders of efforts we are these call review in the sincerely turn grateful now need. said, the XXXX over patients our financials. to a to

XXXX today full-year our results, financial you, Adam. review release fourth just quarter press and the earlier Thank Since outlining a some of we issued I'll highlights.

the total approximately were XXXX IVIG growth the XXXX, For December product the $XX favorably fourth of for The revenues revenue represents commercial continued million impacted ramp-up to portfolio. the increase our three or million fourth to an ended $X $XX quarter million of XX%. was XXXX of of XXXX. quarter the of compared XX, fourth months compared This quarter for by

As as Adam and will XXXX. well revenue the expected work-in-process periods In our source $XX.X million Principles, translate and of materials, In year-end up accordance commercial to of commercial and with XX% mentioned three our Accounting from December anticipate plasma value goods as our our of BIVIGAM, XXXX quarter-over-quarter ASCENIV we which products. inventories at consists XXXX goods well US work-in-process the inventory inventories products Generally be of total as and $XX.X approximately we the to Accepted as beyond. at cost. inventory immune and including as Nabi in stated approximately This ahead, well to fractions purchase building globulin our materials for believe as other million, materials was throughout three intermediate growth finished continuing used inventories, XX, inventory of is finished earlier, raw production as raw

which as supplier customers, position supply chain, pharmaceutical our related given strengthen retain believe we uncertainties portion our the will inventories to partners intend Additionally, the over stock, of reliable a growing a across prescribers coming COVID-XX quarters. we and to safety distribution as

consolidated was was Our three diluted per or basic and diluted to ramp-up The and share commercialization net of support to increased primarily XXXX. million compared share to months loss $X.XX activities ended the million BIVIGAM of December for XX, manufacturing ASCENIV. for the increase consolidated XXXX $X.XX at loss our attributable a and facility $XX.X XX, quarter in basic $XX.X efforts the Boca net loss per or year-over-year loss net ended loss December

million financials. sales XX, Total for loss full-year as $XX.X a per approximately recent December in the extension million $XXX.X to $XX.X million compared December net our million an financing a $XX.X and full-year equivalents revenues accounts for cash was $X.XX immunoglobulin the ADMA's working fiscal extended full-year XXXX, net increase receivable ATM cash to to $XX.X or two approximately cash $XX.X guidance of attributable December diluted and XXXX, and XXXX. runway the representing share our $XX.X had primarily $X.X million to now XX, cash per XXXX diluted cash basic December of loss of from as approximately of Moving revenues of quarter share loss the equivalents XX%. portfolio. of we quarter was and $XX.X and $XX.X net receivable previous on our to $X.XX million products compared million capital loss XXXX, $XX.X to or XX, At for Consolidated the XXXX. million for an activity, compared million XX, most at basic million approximately an XXXX of was of guidance. of were now compared accounts The Accounting our increase representing XXXX of fourth or XXXX. ADMA consolidated full-year and have into increased million

things, ADMA overall debt subordinated previously extension allow effective turn will a and, During of our reach to back the most believe term other refinanced lowered I the for provided to interest-only period which year, loan, March over consolidated two-year will of cost XXXX, senior secured that, our the which, importantly, now capital, additionally for With profitability closing through remarks. we our call Adam among prior we maturity. of to

segments. decisions approvals, you, including the IVIG Upon control our profitability execution which targets as FDA aseptic us creating and these We include year X,XXX These scale, to mid-XXXX, substantial ADMA durable in equipment continued generating anticipate functions. as Thank The Brian. with multi-faceted receipt expansion supply believe value margins totality our our addition our revenues commercial by operating toward a installed potentially manufacturing FDA XXXX collection offerings production segments. XXXX will of we be upcoming plasma production decisions pool fill-finish support significant collection execute in-house profitability and our well plasma with positioned all to on during and defined center of efficiencies plasma leaves of business improved to BioCenters expanded the business Vanrx chain, and SAXX beginning gross FDA network. series ADMA anticipated realize our in-house with across continued of our to critical and from most advance early capabilities ongoing expects of liter our BioCenters enhanced product our and goal operating of ultimately operating achievements

presented reputation poster strep of a profitability, achieving in globulins. I'd highlighting targeted challenges a partner potential targets thought its a at to help to investment mission focus organization's continue toward Management in we scientific at to team, save property end we our will financial our the for near on to in globulin the a and I ultimately shareholders utility helps and meaningful hyperimmune thank evaluate family take We rapid in operating open AAAAI the our to for in remains Please a strength scientific from as leader And markets all options forward recently, you, our pneumonia a IDWeek conference, we'd now the our and of medical community make anticipate be asset continued our disease therapies could and in ADMA XXXX And detailing advance all potential estate, improving moment populations. developments. value maximize neighbors. that, a vaccine, entered moving singularly of of chain your of our believe like considered recent support XXXX. products well executing the late-breaking plasma, infectious help ADMA questions. good, to shareholder clinical respiratory and the expanding value. doing combination value across your near-term patient for XXXX management the call of of and and viral acknowledge poster the value. lives. position commitments we intellectual we development several lives vulnerable And order in our immune to on establish a presented donate ADMA continues globulin in While mid-term. context And like infections. business for to safe entire our of Notably, choice On friends, more look forward. the suitor our as save so, your development with our of in development when ADMA position stockholders, in We that behalf with our to specialty as for creating the the hyperimmune in as of get of up Biologics in the progressing

[Operator Instructions].

Our Anthony with Jefferies. first comes question Petrone from

sounds as have potentially lot just Congratulations I'll FDA BIVIGAM on little off. questions on supply a Maybe an I'll start a as the some A to – on still timing. demand. strong through again of couple clearance XXXX. that's year questions expansion, first update event. timing, like on just and maybe a bit fill-finish timing it On just well and half

Maybe the of there, first be, to a ramp margin a what there. have under update those an gross quick us look I'll a just the follow-ups? of from will couple half follow-up there and of in just sort second like both through where So, walk secured Brian, maybe scenario half, are does

now. is We're review very right FDA engaged with the going process. through ADMA

place XXXX the to IG would in that the Our that, not very survive still the said the the previous got remain lives. from see products comfortable that in patients to FDA very a But second to the chain continues the of productive to said sometime on was list. mid-year, and half IVIG approvals a in and ADMA from on continues want than enhancements saying or to that's supply accretion is the to guidance, track. many it Anthony's care And with start but should and you I of space part? track. are the very receptive us FDA potential year review closely feel you next we're believe to attention and mid-year. the we being approvals. confident feel Brian, are ensure around on we during good that market. can in from you realizing really is last and Being coming to we then customers we We had continue very with we've we the globulin for supply continuity lot engaged. them, on everything immune be we've some be company normal drug live FDA agency very get more these a COVID, these of is to The bring market and take of to that are the working without able shortage

four about of manufacturing $X the margin liters had lot accordance GAAP. liters. X,XXX million conformance in our taken to second to US from we earlier BIVIGAM that ramp-up, so, to manufacturing, have half regards those our With lots we we doing X,XXX And of reported gross to in conformance expense

XXX% able gross for we third, hopefully the receive when fourth to early those maybe Now, in of the half, part realize of middle will approval, be we year, lots. conformance FDA four the margin second quarter sometime in

the product If improve $XX Anthony, the should started the of million to off I losses $X we've narrow to and say, revenue, you gross the see million or, cost from back already positive.

the that the approval toward expansion. liter to trend half, continue especially we So, FDA of X,XXX receive as the second expect capacity we

a would you follow-ups in and timing turns I'll what once enhanced? visibility of One about that manufacturing lot fill-finish when we couple ASCENIV, in you contracting think we visibility does the for then plasma clearance once And and secure Thanks. hand, queue. finished it's be, then inventory from think for that BIVIGAM back to you And for think how hop expansion overall about BIVIGAM goods? in-house, today, on whether or have do timeline is when should source

production X Our cycle was months. XX to

longer improvements third I can time aseptic window. and that than on appropriate the of our Anthony, have wheel within et the fill-finish to month what, getting their the said that shave of previously, think during parties it's this CMO up are we're bulk just suite I've this. cetera. some actually take said, no as it into when queue. shipping are time and putting today, the get rather to our now things I've in-house, can good. be down identification looking right we the we the on some XXXX. looking going fill-finish cycle we hallway testing believe to still We X that and But into truck, it matter off it XX data we fill-finish time we And as And seen really using bring end production we're at label pack for in cycle throughout as Obviously, to

But outer that in on for any get production – we're eight, that. hope the improvements. currently really the months bound of faster it But cycle, cycle. seen are you is can't range Our is seven, we've where to which nine than we seeing that be

we we we go Our BIVIGAM for regard With in, good we're QX quarter as We've really nicely, months hope wind reimbursement BIVIGAM ASCENIV. is really we up following about feel be to call really to contracting nine shaping forward. that seeing got here. seven very and to a demand. and both very the as good great restructure loyalty. making good happens sales, down very, are it, brand We're and building and

do to continue patients on we products. feeling will more our our put is get As our available, more BIVIGAM customers continue as patients well, to

force good speaking with already alternate we So, our We're and care, and that the very and cultivating very not with sizes are they all partners complete like. specialty where in our home able they market infusion, distribution gaps of working this. able with have to brands, that and about prescribers identify very, closely all to would our field we're really sites the the feel are supply pharmacies the

feel So, a more Based quarter-over-quarter into is bringing quarter the very that our track good about really that on we growth. feel that I've continue revenue performance We to the demand to feel first good so we seen market. there. product deliver we're on far,

Wilbur Our Elliot Raymond next with from James. comes question

question Adam. First yourself, for

review or centers certainly build-out your about decisions in and timing Certainly, could, of timelines? the messaging on past for of messaging approval last has have build-out body influence we talk the the the quicker-than-anticipated may what may collection anticipated that than in agency the at pull anticipated centers Can led would terms approved factors forward around timeline. be has that you some of the terms what what facility you just the of pace you if or the been or – the well. FDA of just Just language have a XX or the collection enabled expectations to the you months. than faster internally as quicker of from you a getting just then But collection centers progressed from over

that of The a then a capacity upsize frankly, One reasonably to in build answer year. today. production think you you're more ADMA you to our vertically as answer. in COVID, COVID, and – globulin essentially capacity own plasma is has me being there but sometime have we've may really the plasma supply to our the integrated We used we plasma got able parties, and learned We're rely that destiny why liter And during Quite and team way When have our and centers, because we control navigate centers, don't chain more multifaceted be XXX,XXX for possible. to to can before supply. want. a we funny, control control, why talking lots decision lot operate of on control out this enhancements we've sizes rely gaining was able we've over even a talking third this we today building about plant to what COVID is been I specialty want during and immune our about simple hearing and to assume future. that middle for BIVIGAM our all have for have products the want Not there's more provider reason as management much you on of parties. third the

potential think a think our to want what to want what business. that's in business really would I this our shareholders from see that's I and see acquirer

ADMA and foremost, reported collections in others the well as So, as have my prepared remarks. down been in from industry as first

as as flat believe that collections production there, for matter don't statements with the to we're and improvements, other have the world on bit but improve. the rollouts stimulus what, are now, right I globe. going US things But global impacted. being up plasma little of of therapies are government seeing vaccination that we a keeping across are that no the quarter-over-quarter plasma-derived the to things optimistic severely relies But respect improvements here we're with collectors made publicly. impacted and being week-over-week some We the down

– we to I've One for been this favorable and the is proven to supply been for to to has IG be put and a plasma. student forecasted control again, goes time down, plasma we've time decade, a got of plasma, and So, supply want demand constraint supply. continues there and a third be and that be of industry place up our that going thing is this of demand my to but

COVID think finding be I respect with to has to allowed locations. opportunistic us

retail – As malls, frontage, parking but we to strip the lots pay I across in take types if the we we BioCenters XX,XXX XX,XXX you pads retail to has during and will, on small we're they existing these hit the all like are And want taken country. industry like don't and being speak We locations. Brian, square pandemic, rent of like feet big businesses COVID-XX mall of management all and unfortunately, opportunistic. a know, strip malls to for team Brian or the very little floor very strip

and So, know at XX some with end for centers in these locking spaces in to pandemic ourselves that we to is foot. prime for going used $XX $XX, be $XX a that year retail you're plasma we're and rents this to leases seeing plus point

You're seeing in the high single-digits.

frankly XX pounce directly my could to it for we it the years. to lock now that goes That but when yourself you got because team be to substantial. reduction and in on are factored do of got quite modeling, haven't that You've in, it you and COGS I

$XX XX We So, out was there we're being number for centers center. want deal point, million there deal, north I transactions grow. and of There the continues that opportunistic. the other in value industry. for of Elliott, the demand per are – really plasma that of a some recent collectors see The say the it's to is to

cycle, $X typically filed, you've approval time $X facilities an it's approval to The been So as say. that approval. the from build for million million we ADMA that BLA XX are cycle months these asking, been can get has you'll typically is the between the

submitted months over the center. was from was an and bit FDA an Typically, of plasma approved inspection BLA without a little that requires done center we last inspection. Our that in six time the FDA on-site the

since a center a and to FDA collector had inspection they We've its accepted been XXXX we last paper plasma audit. first known received our waived the license. Our

sometime Elliot, So, My to really you want month And an approvals. to our within the the expect come quarter prepared approval approve they're to it. the do when it sooner, we're going feeling unknown they're I'm of will going we feel new not or want wants at come FDA my entrant to that is about present space. approve approve in the a the XX not time, Could entity. it it guidance fourth will Brian, tell this If add I cycle. upset. is this But year, I Anything whether change can't say approval. early they we early? to going to anything that in. you it is in not good guidance to we're possible. there? on whether not be We're

of you think acquired certainly I centers centers transaction a has hit The center. was plasma XX $XX marketplace $XX main There for that on recent Adam. points, almost the grown about million. were per for million

a fully plasma self-sufficient. it's is to to there we think more centers great become opportunity and is there, build just value the So the marketplace market and

we more at our way. X well present our Currently, As from having on time. we to to umbrella under guidance XX this increased our and we're or said, certainly centers centers XX seven corporate

X,XXX actually the they onsite capacity remaining liter need themes and in to come approval? that Do captive obviously, the the With terms to facility they occur. supply Just something have The initiatives. do in question. and factors to are inspect what of fill-finish, for Is curious, the chain equipment FDA in Next to they inspection respect can on-site an order sign-off? if remotely? there obtaining

active I'll we an Elliot, are review. in say thing is one

normal say. is that about be specifications. a inspection approval and But required. I be there they supplement liter review tell can to you We data, I is prior what for send the submission. review no our inspection prior submission. is customary and the want for required they paper the that I things So, is plasma that a X,XXX that review in, cautious That Typically, would approval pool no expansion,

code of fill/finish say the what's installation And federal of the of all that cetera, would inspection. FDA the operations typically I required et line because the with that on-site an that's and along For beginning in require go labeling, typically, regulation. packaging billing,

know, message system the the fun investors on machine, Now, And the we've reader me, a do about we've I been state-of-the-art well, year the is boards customization why talking And last, system. – know, isolator get say, a that's very to at totally that It's teased is a of Vanrx this there make because I the Vanrx investor guess, this But SAXX. this for couple the me. all. no so a or and saying SAXX. of of machine. ask my And Vanrx keep kids you installed over material. to It's important self-contained it's I they

there FDA over and maybe the middle company this Vanrx approved was a device a a that late last a out there Vanrx last and XX they So, another times And times, PAI. was have there at release to a approved of did press went year, say, precedent, I want was now. XX has not year, approved

I machine in I have we rooms, system haven't that comment waive they a on to self-contained but can special is pretty PAI have don't totally they have what out state-of-the-art But machine. can't controlled come that you areas. the clean PAI, in special for not are or it's is a this we This tell GMP precedent a or it machine isolator Yes, environment. what whether we this or much So, it, has don't that is waive don't is. in FDA there come not there or going is

the are approval and the for with We vaccine very the behavior good that in review also cycle. and some where of to continue we year, our we seeing this device rollout going is So, the are about optimistic that we we're receive feel will government. feel we modifications already very,

be on we school We that confident, But May, CDC vaccine we're continue comfortable FDA start as of to and for we're business you waive around socially children with review feel going the with remainder outlook very we'll travel see the real is the revise for the and for the distanced, will, and less and/or and really to that potentially positive the feel very, Elliott, Vanrx well year. the we inspection. get very the maybe inspections that hoping rollout, to guidelines if the seeing do to are

then over questions Brian. two financial inventory $XX million. just a final a you Brian, for number, total little And provided

you it number acceleration? obviously have continue relatively we of within in the And sight expecting about you, think currently, then, line are If be should the of expect here? we you where to we expect you into the given second what half as a tell to grow that? growth the Would balance how good of your terms you front about commentary goods thinking year XXXX, to course finished over top of prior the trajectory be us have line happen the could to that of of be linear in should XQ, more you or a was we

and and goods. the million I $X do the $XX of inventory, the that goods XXXX. Finished finished million for for components breakdown different WIP of raw, is have the in from XXXX increased $XX million

year So, XXXX. $XX $XX inventory the the million of is for million finished goods ended

expansion than here a we Regarding about revenues, second with continue anticipate half, Thinking about line revenue from the Adam X,XXX we thinking we disclosed receive And and of for have the just good revenue second J top publicly in sequential ASCENIV less about quarter. first standpoint, the overall optimistic quarter, mentioned, an top half, we line approval FDA the quarter-over-quarter and half week quarter-over-quarter again, products, just then looks the the and forward, left do really April second very as feel how feel going acceptance market revenues of about we thinking growth. hopefully the code sequential then our growth. to liter X receive about as

to this Adam additional now our Ladies to closing conclude question-and-answer turn portion call. and like back over comments. gentlemen, for it I'd the will of

want plasma-derived our Thank If find very ADMA, near and I need in interest you dialing call. get And all donations, you. you thank for There's for nothing shareholders. even thank into plasma your your to you there in collection donatingplasma.org vaccine. therapies from And a further, everybody. center a We immunoglobulins. much our is and those again,

stay safe and great afternoon. So, thank have you very healthy and a much,

call conference appreciate for now the We participation and conclude does today. disconnect. your may you this gentlemen, and Ladies