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spk02: First quarter 2023 financial and business update. At this time, all participants are in listen-only mode. There will be a question and answer session to follow. Please be advised that this call is being recorded at the company's request. I will now introduce your host for today's call, Tierney Sacavino at Accorda. Tierney, please go ahead.
spk03: Thank you, Terri, and good afternoon, everyone. Before we begin, let me remind everyone that our presentation will contain forward-looking statements. Detailed disclosures can be found in our SEC filings, which are public, and we encourage you to refer to those filings. Today, during Q&A, we will take questions that some investors have written in when they registered for the call. I'll now pass the call over to our CEO, Ron Cohen. Ron?
spk04: Thanks, Tammy. Welcome, everyone. We will start with Imbresa. Imbresa U.S. net revenue for the first quarter of 2023 was $5.6 million. That's a 52% increase over the first quarter of 2022. PRFs, or new prescription request forms, increased 45% versus the same quarter last year. We are pleased to see these substantial quarter-over-quarter increases That indicates that we are building Imbresia back after the impact of COVID in 2022. Now, this slide shows the pattern of net sales each quarter since launch. Each year, you'll see that sales dip in the first quarter as a result of insurance deductibles resetting, and also because of Q4 buy-ins by the specialty pharmacies And then sales increased steadily during the year. We've seen that pattern throughout the launch. Now note that in Q1 2023, we had the highest first quarter sales of any Q1 since launch. This rebounded substantially from the marked decline in Q1 2022 when we believe that was related to the Omicron COVID surge at the time. We're reiterating our guidance for U.S. net sales of Ambrosia of $38 to $42 million for 2023. Now, we saw a similar pattern in this slide we see in total prescriptions, or TRX, which showed an 11% increase over the first quarter of 2022 and a far smaller drop from Q4 than we saw in Q1 2022 versus Q4 2021. Now, importantly, New prescription requests increased by 45%, as I mentioned, in the first quarter of 2023 versus Q1 2022. And we expect to see the impact of that over the coming months. Here you see cartons dispensed to patients, which is the most accurate measure of true demand. That also followed a similar pattern, with dispenses up 12% over the first quarter of 2022. And again, this was the highest number in the first quarter since launch. We're very pleased to report that we launched a branded commercial for Ambregia on March 30th. The commercial is airing on approximately 50 streaming services, including Hulu, Disney Channel, Paramount+, And it's directed specifically to households that have self-identified as being impacted by Parkinson's disease and to healthcare professionals who treat Parkinson's disease. We've also launched what we call a digital surround sound campaign of Ingrigia branded internet and social media content that coincides with a commercial. Viewers can opt in to obtain more information or speak directly with a nurse educator. In just the first six weeks of streaming, the commercial has been viewed over two and a half million times, including views by 40% of our target healthcare professional audience. That's in just the first six weeks, and it's also already driving substantial traffic to the website. And if you would like to see the commercial, You can watch it at www.getimbresia.com. The regular full Imbresia site is Imbresia.com. Commercial, again, getimbresia.com, G-E-T Imbresia.com. As we announced earlier this week, we've entered into an agreement with Hangzhou Chance Pharmaceuticals to commercialize Imbresia in China. Under the terms of the agreement, Accorda is receiving an upfront payment of $2.5 million, a near-term milestone payment of up to $6 million, $3 million upon regulatory approval of Ambrosia in China, and additional sales milestones of up to $132.5 million. It will also receive a fixed fee for each carton of Ambrosia that's supplied to Chance. And by 2030, It's estimated that China will have approximately 5 million people with Parkinson's disease, the largest single population in the world. Chance Pharmaceuticals is a Chinese company that's focused on developing and commercializing novel inhalation therapies. It's worth noting that its founder and CEO, Dr. Donghao Chen, did his post-doctoral work in the laboratory of Dr. Bob Langer at MIT, which invented the Arcus inhalation technology that's used to make imbresia. He also worked at Advanced Inhalation Research, or AIR, and also Alkermes, where he was the CMC lead for an inhaled insulin therapy that was also based on the Arcus platform. So this is a company that is very knowledgeable about the technology, very excited about it, very passionate about it, and plans to seek marketing authorization in China as quickly as possible. So moving to Ampera, Ampera U.S. net revenue for the first quarter was $12.6 million. That's a 15% decline over Q1 2022. And this shows Ampera sales performance from the beginning of generic competition in the fourth quarter of 2018. And you can see the slope of the decline is continuing to flatten through 2022. We're reiterating our guidance for 2023 net sales of between $65 and $70 million. And we project that sales will stabilize at approximately $60-plus million over the next several years. We're continuing to execute on our strategy to maintain the Ampera brand. Our field sales team is continuing to call on MS specialists to ensure that they're aware of the various support programs that we're continuing to provide for the brand. Also, we're continuing to hear from both the healthcare professionals or healthcare providers and patients who value the support that we've always provided and are continuing to provide for Branded Ampera. Access also remains high for Ampera. About 70% of covered lives can get access to it through insurance. And now I'll turn the call over to our CFO, Mike Gesser, who will review the financials.
spk01: Thank you, Ron. As Ron stated, thank you, Ron. As Ron stated, global and breacher revenue is up significantly over Q1 2022. Adjusted OPEX, which is R&D and SG&A, is down approximately $4.7 million from Q1 2022 and shows a quarter of continuing efforts to align spending with revenue. Cash balances are down from Q1 2022 in alignment with our expectations. In addition to our U.S. revenue, we reported $526,000 in Abresia ex-U.S. sales, $2.9 million in Ampera royalties, and $587,000 in Noralis royalties. For 2023, as Ron mentioned, we are reiterating our financial guidance on Abresia as U.S. net revenues between $38 and $42 million and Ampera U.S. net revenue between $65 and $70 million. We expect adjusted operating expenses of between 93 and $103 million. We expect ending cash balance of between 43 and $47 million, and we plan on achieving a net neutral cash flow or cash flow positive for the year. And now I'll turn the call back over to Ron.
spk04: Thanks, Mike. Moving to an update on the Board of Directors, Jeff Randall, who has served on our board since 2006 and is currently chair of the audit committee, will be stepping down from the board in June at our annual shareholder meeting. We are deeply grateful to Jeff for his superb contributions to Accorda. He has been terrific, and we wish him the very best in the future. We're also very pleased that Tom Burns, who is CFO of Zoma Corporation, will stand for elections to Accorda's board in June. Tom has 25 years of finance and accounting experience in biotech and high tech, and we're delighted that he's accepted our invitation to serve on the board. So, in closing, these are the four pillars on which we're building shareholder value. First, continuing to accelerate and bridge this trajectory in the U.S., taking advantage of the new post-COVID environment with the commercial programs that I discussed earlier. we're very pleased with the large early response to our streaming commercial and the other programs that I mentioned. We're also looking to close ex-U.S. partnerships for additional territories as our existing deals continue to roll out commercial launches in the EU and Latin America and now China, as I described earlier. Second, we're continuing to call on MS healthcare providers to continue to educate them about the various programs we provide to support MPHRA on behalf of MS patients and thereby maintaining as much as possible the MPHRA franchise. We're also reducing operating expenses, as you heard from Mike. We're reducing them further in 2023 over 2022 by between $9 and $19 million. and we're aiming to be cash flow neutral to positive in 2023. And we're continuing to evaluate collaborations for creating important new inhaled therapies with our ARCIS technology. I'll now open the call for your questions.
spk02: Thank you. We will now pass back to Taryn for any pre-submitted investor questions.
spk03: Thank you, Terry. We do have a few questions that have been written in. Here's the first one. I'm a shareholder, and with all the great news about Ambrosia Partnerships and the ability of the company to pay debt interest with cash, how is it that the share price is still so low, even with small outstanding share accounts?
spk04: Okay. Well, it's very difficult, if not impossible, to comment on why a stock price is where it is, except in broad general terms. Obviously, it's a big, complex market with lots of factors. However, having said that, we are in what I would say is an unusual position historically in our industry. We are bringing in over $100 million in revenue and yet the valuation does not remotely reflect that. We believe that the overriding factor, and again, this is a personal view, that the overriding factor is the convertible debt that is on our books and that is coming due in December of 2024. That needs to be addressed, and that serves as a weight or an overhang on everything else that we're doing, a lot of which has been very positive, as you've heard. We've said before, and I'll just reiterate, we are in regular touch with our bondholders. We are looking at and seriously considering various strategies for addressing that issue. I'm not at liberty to go into any of them in detail here, but that is top of mind, and we are working on that very closely.
spk03: Thank you. The next question is, it appears that a shareholder or shareholders are selling or shorting the stock every time a quarter goes close to or above a dollar in order to keep the price depressed, and what's your plan to address this?
spk04: Well, that's In a way, it's similar to the last question. You know, there's very little to nothing that a company can do directly to stop someone from selling. It's a free market. People are free to buy and sell every day if they want. What we can do and what is in our hands is continuing to generate positive progress and positive news on the company, as you saw what happened this week when we announced the chance deal. We've had several very positive developments over, I would say, the last nine to 12 months, if you've been following us during that time. And at some point, you generate enough positive momentum that it overwhelms the people who are selling or they just run out of ability to sell and they leave room for the people who want to buy the stock. The same goes for short sellers, right? If you have people who are selling short, that is their right to do. But at some point, if we're generating enough good progress, that becomes a liability for them, right? Because if the stock price is moving up, they have to cover the shorts, and then it becomes a bit of an advantage for the company and its shareholders. So I guess my summary there is it is a free market. we're doing what I think we need to do, which is to keep making progress, growing Ambregia, maintaining Ampera, getting more ex-U.S. partnerships on Ambregia, generating more current and future revenue that way, and keeping with our fiscal discipline. So we'll see how long people can sell at a dollar.
spk03: Okay, thank you. The next question is, you already addressed this a little bit, but it says, can you comment on any progress on the 2024 notes refinancing? Might just want to reiterate that.
spk04: I'm sorry, can you repeat that?
spk03: Sure. Can you comment on any progress on the 2024 notes refinancing?
spk04: Okay, so you mean the 2024 notes, I think they meant. I think I just addressed that. Yeah, so those are the notes that are currently due at the end of 2024. And we are actively exploring ways of addressing that. And we are in regular touch with our bondholders.
spk03: Great. Thank you. And here's the last question that's been written in so far. Can you comment on the impact of the Inflation Reduction, or the Inflation Reduction Act on ACORDA? Do you anticipate any, do you anticipate the removal of the donut hole that would benefit in Brescia sales?
spk04: So, you know, the IRA has a fair amount of complexity, so I can't go into all of it here. Obviously the Medicare negotiation is one of those, but as those of you who follow it know, initially it's going to be limited to 10 of the higher selling drugs and then 25 and then more each year over time. We don't see that, we don't currently anticipate that there will be a direct impact of that on us. With regard to elimination of the donut hole, That is potentially advantageous, not to mention the fact that the total out-of-pocket for the year for patients, co-pays and so on, is ultimately going to be limited to no more than $2,000 a year, which is, again, much better for patients than the current system. And obviously, it makes it easier for them to get access to drugs through Medicare. Now, while the donut hole will be eliminated, currently biopharmaceutical companies are responsible for 70% of the expense of the drug in the donut hole. And the new design, it has shifted. That goes away, the donut hole goes away, and we'll take on 10% of the expense in the initial coverage phase. And then for those patients who get to the so-called catastrophic coverage phase, it becomes 20%. And that's industry-wide. That's for all biopharmaceutical drugs. Net-net, we believe it's going to be a positive in our case, but that's something that we're continuing to analyze as we go forward.
spk03: Thank you. There are no more new questions, so we can wrap it up.
spk04: All right, thanks very much for joining us, everyone. We were very pleased with Accorda, and we look forward to updating you next quarter.
spk02: This concludes the Accorda Therapeutics First Course's 2023 Financial and Business Update. Thank you all for your participation.
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