Assertio (ASRT) 7 Aug 242024 Q2 Earnings call transcript

Thank you for standing by. My name is Mark, and I will be your conference operator. At this time, I would like to welcome everyone to the Assertio Holdings Second Quarter 2024 Earnings Call. [Operator Instructions] I would now like to turn the call over to Matt Kreps of Investor Relations. Matt, the floor is yours.

you quarter joining XXXX thank discuss today and second Assertio's financials. afternoon, all us for to Good The news of release is investor.assertiotx.com. now covering our results on Investor for the Relations page our at available website this period would Patel, tables conjunction Brendan Chief and O’Grady, Financial I the Chief Executive today discussion. With in all Officer. to with of review encourage Officer; release me our today's are you and Ajay cover business, our remarks a results and open provide then moment, Ajay of overview just will In guidance. the the financial and Brendan an will After will we take that, covering questions research from analysts. our

make with that and future note during this are performance Please this forward-looking uncertainties, call, risks Such forward-looking our not in management report afternoon's These will and including regarding Assertio's press involve of and Form noted future other and the projections statements release guarantees and are statements described annual other as performance. section in and Risk Form more those filings. Factors as our on well the of SEC. fully in XX-Q XX-K our sections filings other risks

Our materially projected statements. forward-looking the from actual differ in those may results

Assertio required obligation law. these to specifically by statements, except any disclaims intent forward-looking or as update

over with now And will the Brendan. turn I go Please ahead. call that, to

for everyone, call, Welcome, to Thanks, Matt. and joining thank today's you us.

of I very already excited be first joined As to X my many ago, since you I'm and know, Assertio call over earnings is this months a little here.

by stakeholders I couple a thought in Over I of this so today I've may Assertio. asked address upfront. variety that Q&A, the past would question I up come of been months, joined why expect I

the and brought Indocin the Assertio impact integration as of year, These the reset. well events us past allowed transformational Rolvedon. of the that have loss Assertio of Over navigated Spectrum exclusivity on acquisition to as has

favorable assets proven well-defined assets addition a Rolvedon commercial We scale good have by modest fit ready growth new a in and platform that balance the of terms, led future and a driver debt on to solid sheet, a with model.

and these serve deliver of well for the well and as all providers we we reasons, are employees. positioned growth patients as and to For the for value shareholders

also in spent is that background industry, XX multibillion-dollar-branded Assertio over I in particular, years pharmaceutical excellent strategies. an to through skill Teva, go-to-market my and specialty the set XX-plus which the built acquisition, I have and the mostly at years business integration a focused developed match

a Teva across While in was the results I both outside biologic my Assertio's focused experience branded specialty markets, me and generic at biosimilar asset and much time of pharma gained base. current in of inside experience breadth and and also segments, giving U.S., delivered

experience includes Lastly, in new assets a process. significant relevant which, acquiring diligencing due course, and integrating the of

put, match. very good For of simply is skill set Assertio these all a and my reasons, very needs

not planning here that you are departures not I am. to radical be speak with we So -- clear, I'm the today, from any that I I as want planning strategy. current

stakeholders. will we so, execution, greater platform. steady to focus next long-term driving and -- further Assertio's cash on flow we the remain In add can value to can Our bring bring to doing bring we will our scale identifying assets

with turning said, that performance. Now to

I The momentum a by full quarter-over-quarter, by against out well consecutive the well quarter well the quarter to outlook. the of second year sixth and regarded patients positive. tracks feedback stands first tolerated quarter and Rolvedon again the by was biosimilars. field of after physicians, with driven customers, is sales continued opportunity right the company joining overwhelmingly from demand several and the increased meet Rolvedon QX to growth. our had

patients, and resonating. that using and are unique providers focused We to on is position as predictability to a stability our non-biosimilar offer message and

it's year. dosing years. same-day going I'm at to conference present QX a Rolvedon a major expect initial data the completed Additionally, early this medical role several as next for and of us the in over Rolvedon's play enrollment later we trial excited key to about

Turning to generic holding at market and competitor which We our is in internal comfortable the share our we currently X are have at. Indocin. target levels,

exclusivity at the to a We maintain are loss and volume price. this of competitive working are managing

our have cost cut made evolving We the deliver this team have dynamic. we right place under organization, successfully results rightsized and in to sure

role, benefit many In and I other and my career. prior in generic of with had assets the largest overseeing the on points at generics worked my planet the portfolio late-stage

with assets a for have familiar me lost territory that exclusivity. maximize this this we opportunity is other to as work So our and

In flow growth in life either modest the working addition, depending the dynamics. and seeking continued our we the assets, a of as team currently on market existing cash delivery, or are for potential assessing rest stage of

driving As million of cash, a result in the $XX the more quarter. we to total million generated than execution, $X.X at end cash this of ongoing

While we capital as commercial advantage to addition needs with the our balance increased provides look Rolvedon, our accretive working cash have a key assets that our of fit model. add

in turn to financials detail. will I the to Ajay over call And the review more with that,

Thanks, cover Brendan. to our for second results XXXX. would the quarter I financial Today, like

that will to last Before less prior comparisons I year begin, focus the compared similar to in margin, flows and that as prior my cash that changes I cost is want prior quarter. brings to remind year are our to are want results that Indocin third occurred in operating to relevant asset the generic our in given the of Rolvedon and the and now structure year sequential quarter, of on first year. commentary Spectrum this associated competition with acquisition Also, you note it I lead to the quarter. everyone Comparisons seeing

Indocin, that down due in the second sales quarter. the quarter. partially million offset to quarter. the in is decline a offset $XX.X of due pricing. the compared were Demand went which our by again million quarter in erosion net The XXXX, first than difference million, being sales growth second volume trajectory the for and its in during Rolvedon by year as lower sequentially to life expected increase slightly decline the in ago. growth For of the in Indocin, $XX.X another million, set prior of is second product is less generic a up Rolvedon cycle Rolvedon volume quarter Rolvedon $XX.X grew from there total continued $XX.X were high was The from in to growth

year, ASP line and was first to with for our change Rolvedon have compared quarter. first Published Rolvedon, amortization which Both the Generic impact now the step-up for continue the was the is were in still the continues competition, and which second sales volume first quarters Indocin expectations, gross during margin in in class. XX% inventory accounting pricing. quarter both in complete. to in we $X.X its quarter. compared purchase impacted quarter ASP to second million the Reported in to XX% $X.X is million by highest were

margin second quarter XX% the in compared first gross the Excluding in step-up was quarter. to the XX% amortization,

which The late-stage percentage second impacted increase quarter point a was by products, impact. had inventory write-downs X an in in

SG&A expense $XX.X operating the second expenses. the quarter, $XX.X to quarter. from Turning was in down slightly in million first million

from trials. Second R&D quarter million SG&A was primarily settlement legal a claims, expense expenses. included quarter on ongoing Rolvedon second flat reimbursement new and in which of $X.X gain and other for offset benefited matters and expense insurance a the higher spend was on costs by

in GAAP $X.X in expenses an of quarter. were a million quarter basis, operating net and noncash for a operating On loss $XX good we loss adjusted the use income core million, performance of of versus expenses, down as stock adjusted indicator a was Because from a excluding includes first first million expenses, million number net also business. the GAAP second income EBITDA of total quarter the first $X.X $XX.X compensation of in the depreciation quarter. the

adjusted sales inventory a QX positive to expense. of and $X due increase in of EBITDA primarily write-down press for of Please adjusted was The refer results. product million compared EBITDA million. to our change impact adjusted our release lower $X.X EBITDA additional the to reconciliation was QX

our quarter. and flow Crossing in first on over the $X.X the top operations $X.X We the generated million from million to cash balance in quarter sheet. cash second in of flow

working in quarter, previously from $XX.X first well Rolvedon. $XX at product timing will royalties from quarterly the short-term flows and and second of the $XX.X to and was mix end we to million million, interest quarter that up Indocin fluctuate million. cash at noted, the due as unchanged the As shift as investments in have payments of Cash capital, were

invested into In sheet short-term the leading quarter, investments, we second to our tables. balance cash a in change

our referenced position in and line cash new items today a item commentary includes cash cash total short-term for line Our the equivalents, plus investments.

a range of are for maintaining EBITDA to $XX previously announced product for and of which million. We in range million sales million $XXX $XXX provided to adjusted the our $XX in guidance million net XXXX, also

the please instructions. questions the that, from our covering will ahead open With research go to with we analysts. Operator, floor

Markets. Capital the [Operator line Instructions] Your Flaten Thomas with Street from comes of first Lake question

months, maybe with maybe that I been opportunity couple about Brendan, a but excited I curious and was what guardrails the Just cetera? on the start it's it some you if could could put you mean I'm you you or trying around get you've you've you. only that. what confirm made may et or that learned what to been thoughts may worse, thought in not better some there it from or months maybe of

Sure. the for Thomas. Happy Thanks question. to,

the then answer question the come of half I'll and back to first maybe part. guess I back So the

as mean I thought days go. say. I value. in said the I'm an create I joined thought are here going the is role, opportunity And I great XX it's joined happy be, after into things think would I I would to Assertio there -- how I that to believe So I what exactly it beginning, according to because they

opening people, confirmed model, days. commercial first said the remarks the I think sheet, XX I about the all my that everything those balance in in about my have that about been

development there bit. heat that those Rolvedon. There's little go. the I'm excited potential about business I numerous a deals We'll get. But to think is out up starting how in to see landscape

I shown. as growing think is Rolvedon nicely we've

modest assets. portfolio the I I driver. That execute be of other can we as some we'll in will well think as primary our to are assets optimize Rolvedon. the There on growth think of later-stage some get that continue growth

that my grow, Assertio I'm foundational going be excited forward, adding for and positioned to stable of. which is we growth business really is So and excited position the very and start to very can to take do to and part

guidance And you're range. about the half end at you would of of first speaking for product perspective, all? top modifying $XX.X-ish if a of the your of thinking year, sales forward, we the guys guidance be are half go How about million growth, you from which as --

back Again, give where sure I'm so XX in, better that. a So on take a you in make I've handle of to all days got that is. I want I'll good on and come November that

of months you out. shaking November, And the is year. obvious. very by take look a will something year time have completed I we brought point, X get how just we'll good up the that's the to But fairly a think we at

see So we'll and at guidance take a that look point. we when do

comes question the line from Ram with of next Your Selvaraju H.C. Wainwright.

Congrats on fine quarter. performance this in the

of was of I on wondering regarding by number Indocin to if expect Firstly, the expectations you comment you generic that to competitors be your end on could the market year. this the

based If are give projections. on that, you maybe on granularity us expectations your what internal can your some

And that products any to likely what a the you necessitate on be currently akin strategy of the your to what And may be additional Rolvedon. in regard anticipate with bringing at force would or products. not opportunities are a more virtual promote can second with to if along or of question field the products you if may sales you lines to doing overall pertains looking these you're deployment basis, that

questions. So great

on question frankly, I on the used question competitor never with this in Teva. But competitors, different to lot we expected was know. I And assets market really quite happen. tricky the on this always generic another you July. a So didn't get generic when That is because a

don't goal we'll So that product more launched. We has than and see. other really not than went, that date came much been know and the

every you not, guess that Potentially. of that Indocin. it's I one So end of by there's the somewhat for that, a day could see tailwind another Could we say year? the

just may market would year. or the by get end the generics and may see original X X was Our of on maybe thought this see lucky the one. We we we

to say, for hard it's plan but multiple. So our was

the if here go that's upside rest see potential kind of we'll any year. we there's we're the the for how thinking of year, So through generics about but as Indocin

field our of that I far overall all -- And commercial product as force nonpersonal and do we our a -- something we're don't lot we have there I current of assets on As some Rolvedon. But know, Rolvedon, model. a bit for supporting you require little promotion. both as actually, looking strategy, we field think assets, we a out capitalizes later-stage omnichannel. mean,

an for looking don't that the that think I So or asset other. is we're exclusively one

has we're is cash builds that for our patent or I that that capabilities, accretive, looking think an protection asset exclusivity. on

we at we things can we're cash are and those the reserves execute and looking the with think that I have. that balance what

don't we're kind for a that that's where looking XXX- of force. So requires asset sales looking. X,XXX-person an to think And I we're

think really core our I place in fit assets are. competencies our we're the looking and that where at market

Your comes of Maxim the Rahman Group. question from Naz next line with

Congrats on progress. all the

are BD, for looked guess what think been my been thus you the valuations do the you Or the structure opinion seeing at think you based relative of in you how high? your value Just an valuations you on of of assets what's closing are using the potential what to cash, the sort of of sort Are in of relatively debt theme a assets have of in in sticking too of are gating with the And in is you of seeing far, factors do transaction? you And terms terms stopping thinking that acquisition? these from closing that or are also appropriate follow-up equity these transaction? all I on currently? Like acquisitions? --

as Ajay So I'll answer two. and I'll too always high. a one, buyer, valuations answer are But part part let

that out back that BD say this really there discussions more there And If if having anymore. our So opportunities obviously to don't say put pleased at with hand that pan out come encouraging with then view, But to things how. can't are Ajay, I'll and we'll we'll of said comes organizations, I'm do, what interest in of I'll and see there any that what you want we several certainly we're that, out. talk see it now. that's about us And point. do. so I any what's it. things just can But active with detail. are There there. right say, they executable. in of are those we'll different believe But more kind some really are to of I over to and maybe we are out

Naz, Brendan our thanks that at what looking how I'll question. the said terms Yes. Yes. of assets echo capabilities. we're for fit in probably

looking us opportunities our we'll of a of think cash we're we going acquisition I cash but fit at debt I And Obviously, capital be that start from our sheet. balance lowest have cost think down the capital, with I think size perspective, at which But structure. the look capabilities. either from start we from several terms in have avenues, mix there, a ourselves for will we'll our structure on perspective. we to see utilizing capital then first line and with

line Global comes question Alliance Scott next with from Partners. Henry Your the of

I your Brendan, Hopefully, over. call, interesting. Congratulations, won't get first conference too almost

it by expect million So growth think is strong How or in still to it the way? we you And growth XX% to about and higher for product you could annualizing in a don't you still if about answer lower, of I if stage? at great. Should we Rolvedon, about $XX dynamics, factors talk specifically, tilt -- And be starters, the XXXX, of that have higher north that could of when which or think that kind that growth. would just think maybe strong it some threshold. XXXX want competitive you product,

know, legs for next We you a it's on not for Scott, foreseeable as in not we And for it this mean to I just plan asset, a thank for question. for growth you year, question. the Rolvedon. good the We year, future. but it think has organization. just bullish are be the

-- we there. next you it's different make do think that is something you do manage volume, as we'll out gain put -- see I contracts you that And deals yes, constantly different growth year. that and we So

good So volume to you have But ASP growth. in the to I balance the a think versus erosion got do place we've that. plan

continue why to I this we out the and no through reason can't I of I at As rest look year Rolvedon. see look grow XXXX,

a quarter-over-quarter. straight-line that growth, like doesn't It's it grow not though,

my in of their take somewhat vacations to quarters they see chemotherapy can Traditionally, good others. bigger been leaps because quarter, family. schedule the doing lot where markets, flattening the you of and a they so schedule third in will a oncology Some chemotherapy experience at on several feel patients in just than go have vacation QX weeks has their least with

tend more several can yes, QX be years. the to year to year typically, So hopefully and quarter. a of for growth But flat see next continued Rolvedon we this next and

multiple parts, we'll question Okay. may see. follow-up in be Great. my but And

starters, For Sympazan, how the thoughts at in sequentially, in there, they and recall didn't and we Otrexup the I on quarter? least see how any don't numbers did performed? they

Yes.

Ajay can in a just looking But general, the of those and -- for potential to the as is at what those. So we're numbers. exact couple that you the give are assets

product, physicians starting that of think our at physicians love place the of there great we're just it. patients we a look of love out. matter a how Sympazan market. caregivers a take see kind it, regrowth I making patients in occupies Sympazan getting as it's and some to modest It and very go-to-market love is a it, unique and messaging we're And of that aware strategy more the it. as

So like Sympazan. at most way But we're do cost-effective that. the most I looking to effective,

it's think asset. a I great

cost it, and just of share well. that's our that grow of or maintain access Otrexup, matter In so against can have kind of in how that patients as we a manage we market goods access to

are both assets good So us. those for

Sympazan, the some second relatively the flat of in stable quarter-to-quarter. see and from Otrexup year. half think we're was In growth I starting to

the my and Indocin. as And between I was Yes, revenue portfolio aggregate our and but The of portfolio change our kind $X.X XX-Q plus of of both from Rolvedon of later see entirety product the minus the the today, fairly filed Scott, rest and in QX said million. was commentary, product approximated you'll in QX them flat.

was to curious that Great. Do to be expected not in this this year. point time? that about you data but enrollment, you disclose Rolvedon the if at trial? data that then data And have completed like you same-day unblinded later asking already? trial has And I initial is it, Okay. recall, sense I'm of just If mentioned I'd an unknown dosing a what that

Yes.

yet. So we data the seen fully haven't

medical So presented at a major as I said, will this year. later it be conference

data. is dosing outcome Rolvedon. same-day for say So see we're the will powered this What waiting new for the for never trial to a indication I still of exact was that

We see results are same-day we've hopeful on preliminary and more we're we submitted will come that. that use. But And the support positive based on some that optimistic. the dosing data abstract to

Jim Your of next line with question Sidoti comes from & Company. Sidoti the

follow So you a just to consider the to get trial that would compelling, is dosing up same-day larger on labeling? data question. the If doing

if So I question. Jim, label. value but added doing there's not the that a data added larger compelling, just it see that take and investment would be that if adding it our thanks look real in and getting -- to to the mean of for hopes we'll to the required trial, what guidelines a it at is do

we'll where of go we'll some from to we see, the trial and obviously there. So we assess results make leaders that opinion talk full determination and once see the key

charges Ajay, in Rolvedon, inventory were for And Okay. step-up any quarter? the there

step-up was about There was an It $XXX,XXX. charge. inventory

Okay. write-down took what And charge just the -- you can was? chart you what write-down repeat the

our were took we approximately the late-stage And $X the quarter-over-quarter increase million. that for quarter assets. charges write-down inventory The Yes. product during was

back the turn now will I session. remarks. over question-and-answer to for our closing concludes Brendan call That

today. Well, everyone joined thank us who appreciate you, and has I

we to that the commitment create execution as As call I to chapter today's also into further cash-generating be help the the at only opening not finding right to to next solid I'm and we I that here Assertio. illustrated the today, assets our Assertio scale work said business And has move have but hope and value. in excited remarks, my business

to will with in the look be show number and engage of attending I stockholders. to events We months, and our a forward conference coming opportunity road the

the update a And to release, joining press good or his like provided a arrange an thank and you will directly management, a once schedule in for at with you would again call to Take Matt today. information Kreps evening. If contact time. these happy one we of us be meeting please care. events all using Have

Thank that gentlemen, for joining. call. concludes Ladies today's you all and

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