Mallinckrodt (MNKTQ) 25 Feb 202019 Q4 Earnings call transcript

Ladies and gentlemen, thank you for standing by, and welcome to the Mallinckrodt Q4 2019 Earnings Conference Call and Business Update. At this time, all participant lines are in a listen-only mode. [Operator Instructions] Please be advised that today’s conference is being recorded. [Operator Instructions] I would now like to hand the call over to Daniel Speciale. Please go ahead.

Michelle. you, Thank everyone. Good morning, like today. to for would you thank us joining I all

Joining are today. our this CEO; call possible during me the on clarity provide morning who be our where and Q&A to Officer, the Bryan CFO; Mark Mark Legal Casey, announcements Chief on will available Reasons, our Trudeau,

the near-term with the markets. opioid read litigation In addition announcement, this earnings you to traditional filings We we’ve also encourage addressing remarks of their respect we’ve our debt to in to our shared maturities. strongly the significant materials provide information entirety developments prepared thoughtfully morning and today and to as our these

actual Before could materially. Please note, on and from forward-looking of to obligation I statements me more statements, even statements. expectations. these over that be future SEC filings limitations let our possible stated make of if Mark, remind statements the actual in-depth refer that materially to some turn forward-looking or you it’s you, for different results the explanation change you’ll to call we to the call forward-looking the in encourage hear our inherent no results assume expectations us such contained update cautionary We

on for look to We a and information, to website, financial is as of found of and related these which mallinckrodt.com. should provide included release, website non-GAAP non-GAAP We important Relations our information. channel in to will our the our also page performance. time-critical adjusted be you website measures can measures selected use our A reconciliation distribute this our Investor company earnings

guidance as point, has note the year. we that been we our formal for at XXXX this practice will which Lastly, began fiscal general do not you provide

which due for net CMS you products While providing financing XXXX comments help the to expected business be specific general, for hear and the guidance total presentation you sales in Acthar In line XXXX. settlement, regarding the will us specific matter, some should model with to the make we’re of consensus. complexities are not

weaker in of products Mark back the call will you rebounding are go. With However, the we year. basis in be updated performance moving first so across half to of the of we number pieces, a let there on keep year-over-year Obviously, half that, expect a me CEO, the over Mark? as year the to our we and Trudeau. the turn

Good and everyone, us. you morning, thank joining for

I'd are the some uncertainties Before updates we discuss and taking like we strong important the our full-year results, significant address share actions of these. to fourth and business our regarding some quarter XXXX to facing

there CMS litigation, Over uncertainties, if implemented, have Earlier uncertainties we've court-appointed debt opioids focus value us near-term stakeholders facing the and vision past to conditions. our year, will for biopharmaceutical our two innovation for on delivering been principle this the matter. terms an patients the of we on maturities debt of of morning Acthar underserved outcomes with critical important and achieving our that announced long-term the updates, opioid agreement we company With the enabling and to To three focused finalize XX and litigation, interest the maturities, claims reached complete resolve today, territory other the improving of continue major key plaintiffs an and these that help to opioid near-term opioid respect patients related will of announced terms company. broad-based on severe driven the reached becoming in an terms committee claims business: the to continue in settlement opioid global and with all of plaintiffs the agreement. this that engage we all the of The morning attorneys multidistrict in settlement, company. a on opioid principle in supported we've repeat, proposed announced was settlement of against global executive the U.S representing with related the satisfy state a general. against group thousands litigation the agreement plaintiffs the company of reached are of a agreement by I and and the principle group details

the settlement. entities would Chapter bankruptcy related the would part our file business related plc voluntarily importantly, Mallinckrodt Generics Specialty I brands months. for as XX. not XX our Chapter repeat, parent Chapter Mallinckrodt under of Chapter and not that, the for XX settlement would file would part file only proposed the Following all Specialty for company, of and Specialty the specialty plc settlement. Very Again, coming and under as Generics in petitions subsidiaries XX file Brands the

anticipate As remain we a which deliver ensuring offset that expense of to business here, providing and the other will wholly-owned will abuse. indirect The creating far QX to will this, communities filing both Mallinckrodt Generics to operational trust, the plc. fully be Once in and businesses XX continue Throughout on Specialty patients company who or the value other of continue late occur to by timeline will subsidiary as contribute the opioid QX rely Chapter process business emergence things contemplated a will settlement measures stakeholders of the post on abatement we the for for strategic business. calls is the Generics options Specialty complete, early support focused among us. evaluate to impacted all proposed to

and supervised opioid court orderly, fair, binding the against legally company. process resolve claims will related that efficient provide to a mechanism the expect all We

been Mallinckrodt expected that of non-filing process, benefits and subsidiaries of that related an receive that As settlement business to to is with Specialty that for effective. shareholder would prior could drive part a XX better Chapter Generics and Specialty employees, forward including Mallinckrodt would investors, of of for the approach The plc release channeling and all injunction provide the move and been sale strategic we is manufacturer that time also this the manageable our subsidiaries in determine plans a and claims that stakeholders, all have of to to it's When plan is opioid best or its against opioids customers, asserted becomes important patients, Generics interest plc related resolution removes enable of the value. considering us creating forward have step the the suppliers certainty believe our uncertainty financially will for preserving significant value. our we proposed or related

of fully our will expect process. that normally we Importantly, operating continue all businesses throughout this

and committed We we’re and maximizing including as employees will is continue severe and products to execute invest in strategic allocation doing priorities, to R&D strategy. best conditions. of therapies currently and drive on diversified other on to our time, in-line all patients for value disciplined portfolio debt We At same including manufacture of patients, underserved patient the and our what our stakeholders for our supply groups, continuing pipeline, with innovative remain part reducing customers, who rely to critical the us. capital advancing served

a today key the today important principle financial near-term our few of goal this and addressing specific in we you are that the settlement pleased As of these have taking and condition the steps to and be a activities refinancing debt moments. announced I we're our address talk uncertainties, has certain activities refinancing forward. aimed these proposed of maturities. to address uncertainties to through in second agreement details also been In summary, these the at Bryan will

the our that We year to face this significant successful XXXX been distraction. has feel company operationally of for a results. turning in Now the

year, included: diversified we we not capital Generics disciplined primary as were separation, priorities maximizing focus; of opioid of which value portfolio; executing well debt reduction the executed completing able outlined the allocation which strategic course of against due the the with at we've one, beginning the execute Specialty two, net the our pipeline; in-line Importantly, advancing to and three, the the lastly, uncertainties. to

Regarding on, reductions. two trial SG&A milestones StrataGraft. ongoing the achieved had and Phase respect gel adjusted Phase in our With including year for including X In fourth consistently positive X the performance ahead driven throughout largely trial on XXXX. in EPS arthritis portfolio, by readouts consensus, net which of well everything strong focus we terlipressin in-line the throughout for our quarter, performed the significant pipeline, going Acthar positive was to the strong business of we the year, sales spite rheumatoid and and

expected the key coming As in the across we continue we through pipeline, on of our and StrataGraft XXXX, clinical for study readouts results and and the portfolio. progressing including filings the data move months completion will focus terlipressin

three you we’ve been updates perspective, to will be the in capital throughout to we reducing billion quite us year. year on with as for the XXXX provide We in detail. as we significant From $X.X XXXX. debt successful allocation will continue Bryan proceed a continue with executed at net of will we forward. nearly move this in more reduction in discuss the These priorities

from hospital the the specific product on as more in rebounded OFIRMEV. strength little with a products quarter particular significantly third anticipated, Focusing the performance,

approach last we product our to variability, expect of lots on exclusivity. call, as continue communicated As we order see we does which this

largely continued our Acthar seen performed its decline While back the in it year-over-year line the quarter, with expectations of in XXXX. half for third

expect year, for in quarters last we as continue the challenging seen first as payer half continued navigate the We to few much of environment. Acthar softness in the we've a

await the on ruling also a We matter. CMS

continued the INOmax, to to Turning deliver product growth. mid single-digit

of begin impact starting from we see XXXX, bit more competition. as to an we However, are

XXXX. to for to our diversified decline Evolve to continuing it's U.S new believe a yet growth post strong launch Europe. INOmax the of capture Generics competitive to the high in the delivered well and impacted the segment digits likely prior in this continued another be due patients Specialty has low year Therakos We of ongoing as device single-digit will by growth CTCL and double pressure as XXXX quarter growth of expect in in strong sales in remains the business. for additional next-generation again

the and the to call quarter agreement of performance. Bryan principle through walk and details refinancing of details Bryan? the Let turn update, me to fourth financial additional our over

good Mark, and morning, Thanks, everyone.

maturities These address in to The that the Under important among XXXX $X.XX process circumstances to on XXXX. warrants be and company's Generics of Specialty subsidiaries per terms details are April for the of exercise new to filings supervised from addressing Trust settlement, agreed-upon These process, emergence $XXX exercisable Mallinckrodt. from refinancing results, proposed company With as the credit earnings new million maturities and payable the proposed of would portion on respect business will a other existing as emergence of XX subject agree morning. things, emergence due year agreement $X.X Specialty conditions. of the provide the the billion third notes the Specialty the and giving after constituencies, anniversaries. operating of in including certain will And things, exchange fully of of Mallinckrodt million its that Generics has to structured refinancing first approximately other this at their near-term $XXX terms second certain number settlement other payments and noteholders of resolving to exchange settlement, should satisfactory lien has will certain $XXX pay million warrants notes there with second purchase warrants. Specialty with a entered the Chapter $XXX anniversary senior a XX.XX% near-term contemplated to maturities. Generics It eighth condition, affected we'd would noted entered Chapter agreement also term the issue agreement share XXXX update. upon their Generics amend the notes the also into the a the our shares court company The well represent of and loan years. under getting Upon among are ordinary plaintiff million if billion number structured the year Before diluted on over an to shares outstanding support gain claims activities the as and through by effect covenants. XX support abide certain the existing outlined to payable of XX% term of conditions payments lenders in X proposed XXXX would company from and into additional X.XXX in certain start the whereby I against for our the include into $X.X a would noteholders and the

completed, refinancing flexibility in activities, opioid work provide if as near-term settlement. the will us We the we to expect complete these for

encourage Given the you for announcements, the filings importance read I in their details. strongly of this full to entirety morning's

million, we the diluted sales net of of reported sales Now financial Generics quarter XXXX, segment $XXX brand of In million. while results. adjusted sales net The turning specialty segment million. $X.XX $XXX $XXX of to our with Specialty EPS were net fourth reported

Gel and For fiscal Hospital year Generics for in were attributable net diluted XXXX, strength and quarter segment. was billion. offset with Acthar adjusted the and $X.XX sales to primarily EPS partially The $X.XX net fourth of in the sales Products Specialty by decline

decrease, fourth million, net quarter, in $XXX increase while sales $XXX OFIRMEV For a X.X%, brand $XXX an net net net million million growth XX.X%, sales sales, were contributed of delivered segment an Specialty million, in of of Therakos XX.X% delivered Acthar Gel a increase of the the in sales, $XX XX.X%. INOmax

XX.X% Lastly, fourth down X% Specialty and AMITIZA net diversified to the quarter. were Generics increase segment well of The sales in an net saw $XX sales million. performed in

a to Total completion of certain reductions. mix. sales R&D was our was XX.X%, on Turning to profit as net XX% was as to of net to operational Overall for primarily from net driven the down focus of company ongoing from XX.X% programs. down Adjusted by SG&A gross developmental a measures. due sales XX.X%, company total percentage percent expense adjusted XX.X% of a SG&A company compared product as percentage sales the XX.X%, due

provided was million. $XXX Turning with cash fourth to $XXX the liquidity. in free quarter activities of Cash by million flow operating

the cash million. flow and was For year, was $XXX cash flow million operating free $XXX

as with executed at Lastly, we end $X.XX debt cash operations offer mentioned, repurchased early billion. net generated debt and the a discount the year net company $XXX billion exchange a Mark total in fourth principal the debt by this year, which the from debt quarter, With in offer, in million. reduced of exchange and of XXXX $X.XX by reduced debt

full XXXX calculated billion $X.XXX last covenant X.Xx, debt the adjusted year, net was turn leverage Our December XX reduction months. in resulted XXXX which of in EBITDA a at for fiscal

our of this the now Mark? as Mark. on over turn With calculation website morning. this to find I'll can that, You call

Brian. obviously detail updates in important We’ve a Thanks, shared of lot this morning.

clear it's to to business. still taking we do, to resolve uncertainties steps in that While work have we're our pleased key be

be and on which our As of maximizing pressure submission terlipressin of strategic Acthar portfolio, the spite focused one, the launching continuing to operate including we well business the for BLA build in-line in INOmax platforms in today. navigating value to capital through XXXX in XX effectively the continued and business necessary primary and and conditions think focus And Acthar. and about we’re with finalizing continuing of our successfully moving and our Three, net on pipeline disciplined the developing completing lastly, the on: StrataGraft respectively NDA priorities will well INOmax. Specialty activities reduction. competition as the XXXX, our four, announced allocation next-generation accomplishments payer for products further on Two, debt advancing the the both for Chapter refinancing executing and including process. settlement agreement the opioid settlement, all Generics principle and efficiently This as includes

As we throughout transparency seen we’ve to updates on our as business into turn Dan performance to provide move continue period of strategic we strived Q&A. the now uncertainty, priorities this throughout I take from developments, and execution and opioid to us will the will back us for year. call you've against the

Mark. Thanks,

Q&A. here Just of to before things couple moving administrative a

and during complexity or announced what on today, Q&A. information provide maybe limited of we the the recognize given please can fluidity situation First, opioid

Chief that have. Casey to our have questions you on Officer, Mark may address We help Legal

get to afterwards, can through questions Operator, our XX-K And the item single second follow-up queue put to yourself a we’re I market to highlight The we lastly, work expecting file wanted question. and With first today if I that, then, as will want remind Feel is have well. brief Form the a to as yourself can. we after you please closes with back free in question to limit to needed. many we as to

[Operator Elliot Raymond Instructions] Wilbur first comes from of Our question James.

open. Your is line

morning. Good Thanks.

for I resolve but an it's injunction. all-known I it's resolve commenced claims with to as this that future I do that a round that of this potential payers, presume will effectively class as bucket the past unions, a that operating be your question. claims respect emerge claims this potential individuals, etcetera. then years it business belief some any well. as to belief a But companies just space. to would want And confirm have the that, as seems well on SpecGx against channeling that that’s XX to your components ask First, opioid to still important of this want and within part may that effectively would in resolve How Obviously, or about for products of new litigation think any financially behavior, business. you the the of X there's And follow-up action every it? claim now settlement question

category as component segment think you about of that So product that going just Thanks. how forward? a do

ask how on aspects will the Yes. And comment I to your strategic generics come questions. the I’m Thanks to Elliot. legal think long-term Casey question, for then the business. to about going for of options the Mark we Mark? back

that plc to so channeling Yes, could been should claims against have injunction, XX the All all resolve of Mark. process. Chapter claims. emergence prior you Thanks, Mallinckrodt if the have would claims I SpecGx say all or when the a from asserted been expect issued, that asserted

business, the for think that's a diversified this Elliot, something With strategic regards very the of well all, first understood. to clearly options which is that’s I business, is

recognize of there, or treatment business again substances, acetaminophen. diversified and a with a generics, chunk big long business fairly Specialty well. generics that continued now as believe business. the has And to with interesting also growth portion contraction dose that being that It business opioids very of then biggest but very quarters four majority of products. ADHD today, as in after it's business associated are period focused a is we're for well ingredients very is non-opioid the has business Longer-term, of just market the of business well. embedded active part this perform both Let's oral business pipeline, we pain saw also a the pharmaceutical is the this is you as an which delivered particular well as controlled this pain. that opioids And that And that there API has pleased of actually not Generics within the addiction consecutive

well And business. again are that so there even of business more become time, will opportunities do a We think the this over diversified. strategic number for

to We time. will Chapter market we the will operate own Chapter and we we and those business to XX this to process. will the move through the throughout process continue appropriate continue at evaluate Meanwhile, XX continue the as update

Elliot. question, Thanks for the

please. question, Next

Stifel. next Our of Annabel comes Samimy question from

Your line is open.

Hi. Thanks questions. for taking my

just quick questions. So couple of quick -- a

-- of generics launching operational out the have verge have understand any them kind XXXX? emergence then going Thanks. XX Chapter the be the arrangement First, expense other to hamper to on any -- of products the for to And of what what those of revisited timing today? through to made of you’ve year, I of expect -- specialty you Clearly, you’re activities? is, want And the are to requirements has the expects couple launch launch with do bankruptcy. that next second to your And this to what could extent a of this so? of have

Annabel. a about comment business. then Mark ask launch the bit I'll on And and to plans. back how our Casey for to Thanks it XX Great. Once going and speak SpecGx again, I’m questions, the process, impacts come Chapter

plan well by more from prearranged. Annabel. XX how the come Chapter Look, the going various the we including the quicker process, for we we So of flavors And our and thank prepackaged the process. Chapter you, emergence or are support Chapter into out. There of XX dictated is enter the can get XX timing fairly

several And court we the end the now use. and potentially the up restructure, factor the would which year. the process when process. But to months critical happen to take towards of plan a approves that it's sometime would we anticipate so the clear, right flavor will And not is

largely regards file of we're these reported terlipressin XXXX. in these both such to launch these and plans, the opportunity products our -- see very for within Obviously, upcoming be products with launched existing we to infrastructure. but to excited And first And to products, strong our opportunities results, Phase the all, we were of excited on would the very not which about only We're filing delivered X them. have pleased launch also both that programs StrataGraft. for very,

market With in incremental both that fit keep products. hospital in have two So we commercial regards into have to have slot really our squarely from hospital them products, mind, organization. actually don't of you we that they These launch expenses, the infrastructure. products, existing But existing going in our we infrastructure expenses the to expenses, would and because development on and that what and promotion. do SpecGx extensive launch we're The hospital normal preparation again, products would going business. would are business the expect capability be is out XX. the though, appropriate These activities of in we're in bearing regarding very absolutely independently that require and Chapter today line, businesses going two branded the throughout in the to what operate doing bottom have no XX the and would of SpecGx Chapter case process

Great. Thanks, Annabel.

please. question, Next

Our question from Gilbert of comes SunTrust. next Gregg

Your line open. is

overly to team. and almost me future. question the shareholders could these liabilities the, good significant potentially and of very ring too and perhaps, company observation seems for the its bankruptcy Pardon you, fence that you for rest the proceeding but Thank true protect about this, simplistic be the or it

back matter others right, secondly, Do there you here? process to anything have that then from the trying AGs or you at do or all timeline Thank have outcome And the you’re those any that push that it could CMS And this? affect I what’s that about the have announced to So not on market the accomplish of agreed matter. today? three what the insights you. the and that’s then, have doesn't

Yes.

and back Mark matter. So, CMS bit to of I’m situation going Acthar first ask on legal SpecGx. Greg, the involves the I'll comment around to little on a speak question, again your come that

And yes. well-known, -- that process is coming. is and manage to well for Chapter doing tested just So, restructuring The a thanks, answer unmanageable of the Greg. that bankruptcy otherwise vehicle is liabilities XX

those ring truly does of So fence it issues.

in we, a are time. in year. We Again, judge have to as judge on no of with hand, had And at very at went Acthar well. of know or the the insights hearing rule CMS with when felt further matters hearing updates how you that last But at other August time. matter, may federal the any terms this there the this we regards don't

to territory well, XX stage AGs parties simply the just as states, maybe and was. that’s I reference you made AGs think clarify, onboard, is Greg, your not I to to the reference mean which effective what

clarity. So just for

Thanks.

question, Next please.

Our next of Gary from question comes Nachman Markets. Capital BMO

is Your line open.

Hi. Good on think how you provide then down the guidance than could for directional the much EBITDA On expected your hit year-end? go? of leverage morning. is where guidance that And debt you XXXX? refi in in could specifically, break generics? directional brands for you product that How between you. higher X.Xx any XXXX, to Thank consensus? should With sales at color And perhaps all net give Acthar versus that some we activities,

more So, Acthar. let color give Bryan and then little on to me questions ask Gary, come address bit back a and around I'll your directional guidance,

decided of now give fluidity So, refinancing. just both Gary, of and the directional kind the to of because we the -- right guidance settlement

I say, weaker, around the you full-year Dan's overall right go at be look but is. expect a to first and comments, consensus the year half of the going some little if we'd where bit on current back So would for it's to be of

question, Gary. certainly appreciate we the Yes,

point, guidance a than we’ve at more to just provided We firm provide what are the not be call. this morning to able on obviously,

But what this we and things that’s progresses, year the to as updated you you got. narrow. start point, better keep as have obviously clarity at will we So,

quarter four color the regards to highlight. Acthar, there's three with line largely to with fourth on One, I’d like Gary, things was the or performance expectations. in our maybe And in

Acthar rheumatology prescribers. actually refractory with pleased X data response in Phase are we the positive the to seen we’ve with quite particularly that Secondly, patients, RA

there the the focused we -- hurdles to still new, patients additional administrative those payers as long-term to of believe and continue persist And we that We've are three which would of and experiencing to duration that kind pressures, But from 'XX. pressures expect patients to of year. X is particularly programs complete the going clinical in the XXXX, be product of to Phase are prescription particularly of number hurdles 'XX a reimbursement. puts in stabilization emergence data. things. we be in and and administrative driven going the half got of first One However, moving really throughout payer the on readout are classification by continued

in we're commercial potentially way we could XXXX. significantly consider Acthar think of with plan thing that after our with to And an looking as is the number is new INOmax. the as at Acthar sometime model very thing current of and different in which carefully Acthar a a third introduce advanced to for injector the Second talks self change model, payers XXXX first success the pilots we've half in XXXX, subscription for somewhat it's model we the Again, early Acthar. modeled about that commercial seen we're for

is I payer driven persist Acthar. on three things just by half to pressures again, the first likely XXXX Longer-term stabilization So, are mentioned.

debt quantum going on we largely the leverage, guess to you the But guidance of the to proposed I not neutral And refinancing will give that. be are on net debt.

you. Thank question, Next please.

question comes next JP Our of Morgan Chase. Chris from Schott

Your is open. line

the settlement. much Maybe on two very the Thanks questions. just Great. for

seems like core here. just it issue Sorry, the

to I’m just I make First, want clear. sure

the State kind do the counties? to kind we’re seems the to business it to injunction It's really ring some Do be that about when or of this going still not what then going the channeling of get broad in to show much. level? so experience are had you fence up parent And was that I’ve percolate entity you structure today, the announcing Just apply need the terms does that is at this of and with. courts that question this in Thanks What to into you to And do make settlement AGs a like generally my much here? counties place level, -- done sure sign-off eventually how I to injunction. second on onboard for needs this? guess

don’t are both you why Mark, go ahead? Those legal questions.

Yes.

committee So that’s we’ve the that was MDL. of appointed plaintiffs executive towns we’ve from And the gotten a and negotiating committee. high level cities, the said, a with counties, respect in as commitment appointed to court

non-filing forth is it's the transaction. sorry, of should think group. channeling overwhelming you And the And the to protections a so still -- would state to I’m I speak again, And up provide individually injunction, plaintiffs that. filing be legal counsel. to vehicle. I entire entity. expressed at encourage to counsel are entity into the watch appropriate a -- It's say just they a here. get encourage complex legal often has for on matter. interests the it's the your more speak description It's There it's on to I your I'd or with work for a at don't for group that set that's support But to with legal the you to level. done related city

Chris. Thanks,

question, please. Next

next comes Jefferies. Anthony of question from Our Petrone

Your open. is line

I’m Thanks. settlement to announcement today. stick Hi. the with going

two quick states press here. ones be the One Just principle. an release in would it's agreement

finalized/binding. it's guess I technically So not

and is on signatories press So what’s terms just probability second that that -- in be is the maybe actual the then this when is the are one the what here. agreement actually this timing final that now becomes the XX released you’ve And And one of State similar New the actually York to the to release? going binding? set quick

this around principle? is timing the case, just does Thanks. New here and what agreement AG you’ve So the how into what in on State York presented wondering I’m play the

favor really those support retrade can't a be in And on but any and the at get to as York, to that. negotiating together intent final The getting other terms. active enter territories. the And to the and all by states AG of we're final on being able New term the those you So parties the hard to no parties you transaction. terms and Timing of an This there's agreement should a get member will agreement. to date a York details of in group finish they would encouraged over based the look the terms we was be intent terms. by of will respect the believe sets I you line, this the give are community terms financial on to New the the of with negotiate that moreover, into, dictated the we’ve across got to devil overwhelming forth with the transaction. disclosed the respect in sheet today, any from

Thanks, Anthony. Great.

Next question, please.

from David Sandler. of next Piper comes question Our Amsellem

Your open. line is

alternatives So, business. for evaluating if specialty to I’m the you down not road the potentially mistaken, strategic alluded

in of So Acthar your are vein, the organization, the Thanks. that so you to another thoughts is think from of asking you can maybe there Acthar? on something extricate what business, your role and specialty it scalability essentially the that yourself can transform way, the do on you in reliance Acthar or

Thanks, Yes. David.

continue Acthar, in and heavily applies invest to label. modernize the continue we that to enhancements to look, brand the both So,

that those rheumatology the got dramatic made research data that ACTH prescribers next on enhancing Acthar which For make time $X.X getting shift then fact to we're from of level from And to example, the a study injector. we to example, that the could obviously, than from which the billion it's development the and to in for to way were already plan of patients model, further disease. that in brand other years. And enabling with focusing have modernize perspective. the the clear readouts of arthritis We're from Acthar positive additional that series the the role whole we've differentiate subscription that very and and actually data, we we of a our in for have also so and experience has all lead to it's could responses data potentially year we've product clinical of changes pleased, completions development And self around pleased demonstrated steroids, with clearly, couple we've be We've spent think lot payers, last the finally, us very modernize discussions the different greater that and a X really and deliver I product the to the the really believe from market We refractory that with invested activities for a Phase rheumatoid with these patient and things a positive, was label. commercial of a brand. trial the trial. the

we where in the So for have long-term view of business. the clear our strategic is going Acthar real to are plans a view fits that

severe Obviously, we're to innovation long-term role critical biopharmaceutical vision. year. objective be and about we strategic pipeline, underserved potential launch two our is that thrilled with to long-term think conditions. continue driven that’s patients focused we’re an company on going an to Our the in plays important to subsequently And develop and Acthar products quite file this new

well think forward. important our objectives, strategic we we're overall, So role an going that in very will and on progressing have Acthar

for the question. Thanks

please. question, Next

Jason America. from comes question of Bank of next Gerberry Our

open. line Your is

think when when guess, comment guys. questions. generation Hey, my I thanks morning for not margin I’m you of SpecGx SpecGx. what guarantee on the XX% a So spin deferred legal about something these op understand SpecGx the payouts can Brand cash going liability of XX, I plc, the we or Co And profile? think was which occur you thinking was and for to how a or was as if that’s Chapter with SpecGx inclusive before, to entities? like there Good $X.X taking clarify, AMITIZA, go will payments books disclosed, a here of contemplated, fund wondering basis? forward the but that with I’m the valuing And entirety just to billion will from sure will entity? go is, the be trying should on of if can just the go cash then both I the Mallinckrodt company files

section liability a It a as to years. business. the period one this the of specific by not it's addressing of entirety is corporate to over best liability view will for liability So think of of billion maybe be $X.X a I the I start plc. segregated business. the Mallinckrodt And This will liability,

some of Bryan on that can a bit questions were And up flow the you teed cash maybe here. comment little

I cash And flows. prepared through the sure. went my of Yes, kind in comments

So SpecGx, to process, XX and Chapter disclosed. think have flow of we as process, same I cover. Chapter once it roughly in settlement. of the initially adviser it's that won't will XX like all But be And while fees the payments the to to a able out it that back previously the things fund cash the will go

in go spending the earlier order that business you if XXXX, $XXX at in magnitude million we EBITDA looking of think this earlier to about was of an over talked I back when year, were time, profile we this $XXX And million. around

you a of magnitude as So but rough that’s it it's can be a bit a frame. precise order of proxy. use shouldn’t and kind Obviously, not of general guidance, that be to viewed

royalty in the is AMITIZA that? And included

That’s …

that a pull part to spin-off. the the we spin. included as we No, decided was be out the part of that then obviously and as that spin of But product to going was ultimately specific abandoned

So at do it to present. with is nothing business the generic

filing. an that’s that would And be asset Chapter the outside of XX

That’s correct.

you. Thank it. Got

Jason. Thanks,

please. question, Next

Parekh of Our next Barclays. Rishi comes question from

Your line open. is

How are doing? questions. my Thanks for you taking

First, congratulations.

want sign a the I plaintiffs job push not solvent great to that is think the and this them Chapter company good keep a and into XX.

settling on this. job great So

the First, from not bottlenecks you generals. support the York have of overwhelming states on What other that the not clearly, New did did send? I attorney see are this.

I’ve case? stay to want a just of the the out March you make on follow-up. up get I then with will to So And coming sure XX, that injunction the case

York, one? Mark, want about just helpful. but I to talked did think be clarification a that there New maybe would you take we’ve

Yes.

the other question We them they transaction. part that reasoning. Again, is the the the are signed haven't supportive with don't respect of ask why we have better York, look, on to believe plaintiff they a financial for states group necessarily negotiating were And the the directly. into to visibility of of terms New So, side.

million then, $XXX Dan And billion liability. a so of corporate has out as this the said, is Okay. $X.X

is a eight a anything think address into changes we this is right unsecured tenor, And a way? should going this about, meaning, the what How no amount principle, maturities, all I runway your an positive of you out but bond but is change sign long now assume, through terms you runway of and for maturities with your significant forward? for to strategically understand clearly then and this payments, I in of generate changed that interest So is what year is a have obviously agreement in XXXX. going you an cash, all

and do portfolio. a conditions, and patient in talking of that opportunities use And today net last the with for would to fit $X.X reducing the quite hepatic cash product strategic did in-line other continue within with think represent significant of a for our I with strategic will that patients, would which terlipressin most for on on number, Well, that to focusing that INOmax. again solid we're MNKXXXX, entering on X U.S but also same that steps are terms we’ve of want from taken that, conditions I are excellent like sheet, debt. our innovation product we in-line even is continuing to to patients severe but with course, with objective talked year. a about and today severe we’ve we’ve a an into its see focusing very also to capital while Phase is consistent patients. to as these objective strategic think underserved focusing has notable an in our strategy. two a growth making investments a specifically to of effective largely product remain us -- lot deliver that in clearly products spent for critical our bit patients in our and be We challenged conditions. the We look And as these perspective the development we program enhance both pipeline almost maturities, of executing that Longer-term, StrataGraft. near-term underserved consistent tune on enhance squarely then, are a or programs, continue our growth the and some critical as balance We opportunity perspective more want to of billion couple say address, capital in been outlined for Therakos Acthar to a allocation things we’ve well with our We those to priorities steps, portfolio from for disciplined that other look strategic to further groups. to underserved that And in and the priorities. about we've flow delever significant and to focusing and near-term significant very very And been development really products opportunities time invest again, our Obviously, of our in our maximize we we example, access Europe. we going we of or developing of and the our taking process either got and objectives

Thanks, Rishi.

Next question, please.

Our comes Goldman Jarman of Frank question from next Sachs.

line open. Your is

guys. free just you wanted questions, I see through the flow Great. Thanks cash key taking if of think drivers for help to some XXXX. my could for

sort I’ve cash of did million guys of flow. $XXX As XXXX you free see in it,

consensus, should same context, million On year-over-year. today, down so $XXX EBITDA the in be this acknowledged or around is which the you call

and us think I'm you about drivers sort else you. in the have and then anything we numbers think cash opioid million of free XXXX? could for could Is $XXX key there? in any there waiting missing guys flow of the there and settlement of that we're then advisory contributions on presumably, And You help little see costs CMS terms higher legal interest you possibly is Thank decision.

sales, just explicitly EBITDA EBITDA. We maybe to guidance. guidance on comments, specifically on made you on not provided to Frank, net reference clarify, So, because

clarity to I wanted purposes just So share for that.

ahead. go Frank,

say, And would upon million clarification emergence. initial I one other the is $XXX be would

million So, you sorry, $XXX mentioned. that

So I know don’t necessarily that XXXX. that, would be in

right, Acthar, manage And to SG&A said depending of the But will on expense. so pressure we CMS. we’ve also be continue that could there outcome on

expect So significant business to cash generate flows. continue to overall the we do

And I … guess then, Great.

Go ahead.

be the on those expenses you … just it had last and way XXXX? think kind more specifically for guys there what incurred of advisory Is you legal about that would costs, some year. to of any

be much to I explicitly. so really there's I what going obviously point. uncertainty Not those able we’ve at think quantify on this to with mean,

similar now, and to the So keep be we try transparent handful will you throughout the certainly over apprised, we have of quarters last that we do as as will year.

so Thanks Okay. much.

for the Thanks question.

please. question, Next

Trucchio of Patrick from comes Berenberg question Capital. next Our

open. is line Your

question on morning. actually My is Good INOmax. Thanks.

declines? the there remind expected declines you launch? and second to and Just the new should XXXX? that, regarding And confidence the short-term contracts secondly, in in is that these then about. the whether of the contracts to device stem accelerate that expect And that’s gives Can the will can you discuss you we long-term competitive us you half pressure launch when what under versus help talked then proportion business

Yes. things Couple Patrick. about INOmax. of Thanks,

the to significantly the next-generation it would the is and in this change and This single-digit really believe the for also and is in upcoming platform, a you the years continue XXXX. all, to we we're likely leader is this which the that and human that cylinders certainly enhances patients, in delivering if requirement, have INOmax pleased think will, error. of with we that that growth potential saw value call the launch performance very over Long-term, that product because certainly anticipating of mid device deliver the today, to we be large XXXX. we're XXXX. We EVOLVE First would to market game continuing we expect reduce of new was likely consistent in the case to to terms manage is to

step reduction portability advantage So of the we next human the significant error would the for be new we believe, of platform our the potential is market leadership. and and think in, a really

levels, around contracts very seen historically. pleased long-term are renew historical with what our we've that consistent customers continue We to

year we I the what expansion are contracts the to platform change. lead today. three to as us said movement expand three do cardiovascular see really low the share long-term of market see EVOLVE we do which human seen contract. what Long-term, overall call haven't between -- We the to to wouldn't on EVOLVE any as we form expect some for for enhancements, so publicly reduction include, in that's so more to current the to We opportunities piece, potential that to the into stabilization based near-term, -- year well a range far about being label platform, the to the it's or market Certainly really with of that three that enable down typically market double-digit based error we've the portability expect what we could is we and as be as surgery. and for may pressure those think well. of opportunities Certainly think this is under for in platform. split is to these what the year, think brand expansion. the things the we We we geographically of -- single all INOmax we reduction things of is fact the some both around EVOLVE what and expect given two than potential business necessarily have We lead the things. likely put of there the In that on is it for the our all some XXXX. brand some could the thirds of to and given pediatric it stabilization price And brand. places example, have would labeling describe and

for Thanks Patrick. the question,

Next question, please.

Jefferies. Our next with question comes Petrone from Anthony

Your open. line is

Just XXXX to timing. April maturity? tripping Thanks. a quick this, on still wondering we timing a around is if the follow-up the risk the what -- I’m if element have of just

with Anthony, Just to clarify, to timing regards which?

you principle formally then Chapter Timing an into which suggest to in think in would I finalized order to from agreement binding could then go transition XX. agreement, a

term You secure need you the Chapter before loan. XX could

the and loan secure with that April would maturities. term before we move No, forward XXXX the

That’s correct.

Okay. Thanks.

Thanks, Anthony.

Next please. question,

of Evercore. from comes question next Raffat Umer Our

open. Your line is

on not. And after is accommodating compliance its I read how in the on or That's I opioid noticed payments of focus Hi. secured, proceeds of provision XX% is wanted with a to your a remaining case whether debt Thanks so specific me. the it. reading debt it to because the flipside I the there's debt much for suggesting senior but I'm sale.

will a to just that also congratulations. a could sale that is which one. you not of whether from you negotiating Thank is on plaintiff trial I did proceeds, York That's committee Do much update should board give so the that executive the is get us board? if from New And on party. finally class So be on any you pushed out? seems with and debt to notice we payment. generics to expect assume senior sale the opioid more and happen

Yes.

maybe comment Mark, the again seniority New put can to on the back just York just final to and debt. come And the will guys question Bryan you of a it. on then, point So around Dan,

our at think debt billion stack. you existing liability that $X.X us, fall this when look behind believe for we So would I this

that proceeds effectively, a agreement as we'd would where the as in provided some a the handled sell specific that's As be sale you situation future in that negotiated point language how of the far qualifying term in principle. part about potential business, at

some would flexibility. down. that so provides generally And how path are that we'd be govern ultimately Clearly, those ultimately proceeds used if would it a that go us

one point on you will is just we the that will operate Chapter this What business process. we point had Maybe XX the that can the Gx sale happen? throughout to about can own question of assume we continue Umer assume and the

could we then, more whole that New of And business maybe the options a a evaluating just emergence consider. to to the be range which range could options then of sale one of of post will one be Chapter York time. separate We strategic Mark, generics potentially come around from legal XX whole point back

Yes.

not York today does prospect trial. there New So appear a out the be to pushing of

case. Mallinckrodt already said, end of Of in And discussions course, from plc, the York are case. The we would you New York remains the at the that’s defendant constructive a that. that dismissed business in, the parent address what judge understand publicly with say to up generics the I should day. New to the has That traded been

to Nice questions. you. from the for thanks Umer, hear

please. question, Next

of next Our Rishi comes from question Barclays. Parekh

is line Your open.

I SpecGx. confirm on follow-ups. Hi. Thanks One, for my to want taking the emergence of

press less to may terms it the said it to to obviously than of it that And because conditions equal whereas want X%. more the that million confirm X-K providing you anticipate second a or in part year XX% set are documents, the free into before $XXX lien exchange, exchange release to emergence, notes, as available secured in then the than years upon Should all that the two that the second, think I says then new I note new you’re And you holders. payment. made is says that be cash? year, plays of one one XX also we in before XXs,

XXXX. lien's due April Second

exchange it to I new confirm want terms So XX% to in notes? is of X% the

want speak if And some the Mark, then, timing notes, Bryan, the question? do you you on details of would? maybe to to the

have will. take in Sure. shy again, in With support minus, amount by just what process respect going And some if the of process, in. plus Chapter to should something of the a dictated of -- or total the timing, year level you we the XX spent time is

to either in file a somewhere before So time longer a process. in, more year shorter the we to complete could in, time right have ultimately we enter time a but time it should or and around shorter take a

your now. And will be that available the exchange, exchange question first there of was of the second agreements availability of exchange to And for holders support be -- XX% with notes. as key lien be will it all holders. We’ve the will for

Thank you.

you and correct. us want today your joining That’s to for thank for Mallinckrodt. I interest everybody thank in continued

e-mail. available website to and easiest answer call to on me you day. of the and Thanks, I the nice will throughout have be The any be will via have. today a As replay the later a day reach reminder, everyone a may questions way follow-up be available will

This does conclude the program.

disconnect. You now may