ADMA Biologics Inc

Good afternoon and welcome to the ADMA Biologics Third Quarter 2020 Financial Results Conference Call on Thursday, November 5, 2020. At this time, all participants are in a 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 and will be available on the company's website approximately two hours following the end of the call. At this time, I would like to introduce Skyler Bloom, Director, Investor Relations, and Corporate Strategy at Atoma Biologics. Please go ahead.

Welcome, everyone, and thank you for joining us this afternoon to discuss Atoma Biologics financial results for the third quarter of 2020. I'm joined today by Adam Grossman, President and Chief Executive Officer, and Brian Lins, Executive Vice President and Chief Financial Officer. Today's call, Adam will provide some introductory comments and provide a corporate update, and then Brian will provide an overview of the company's third quarter and nine months ended September 30, 2020 financial results. Adam will then provide some brief summary remarks before opening the call up for your questions. Earlier today, we issued a press release detailing the third quarter 2020 financial results. The release is available on our website at www.admobiologics.com. Before we begin our formal comments, I'll remind you that we will be making forward-looking assertions during today's call that represents the company's intentions, expectations, or beliefs concerning future events which constitute forward-looking statements for the purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. All forward-looking statements are subject to factors, risks, and uncertainties such as those detailed in today's press release announcing this call and in our filings with the SEC which may cause actual results to differ materially from the results expressed or implied by such statements. In addition, any forward-looking statements represent our views only as of the date of this recording and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update any such statements except as required by the federal securities laws. We refer you to the disclosure section in our earnings release we issued today in the risk factors section of our 2019 annual report on Form 10-K and our third quarter 2020 10-Q which we expect to file following this conference call for a discussion of important factors that could cause actual results to differ materially from these forward-looking statements. With that, I would now like to turn the call over to Adam Grossman. Adam?

Thank you, Skyler. Good afternoon, everyone, and thank you for joining us on today's call. We hope that those joining us today continue to remain healthy and safe. The third quarter of 2020 was our strongest quarter this year, with ADMA generating approximately $10.3 million in revenue, which represents year-over-year growth of 42%. Year-to-date, we generated approximately $28.3 million in revenue, An increase of approximately 63% compared to the same prior year period. We achieved these strong results due to the focus and hard work of the dedicated ADMA Biologics team, despite the continued COVID-19 operating headwinds. Looking ahead to the remainder of 2020, we continue to anticipate a strong fourth quarter with respect to top-line revenue, while also building inventory levels to contribute to anticipated future revenue growth. We believe we are well positioned to achieve our previously stated goal of delivering considerable growth during the second half of 2020 compared to the first half, and we anticipate this revenue growth to continue into and throughout 2021. During the third quarter, we continue to add new customers and prescribers for Bibigam and Ascentive as our virtual grassroots promotional and engagement efforts continue to yield results. Although traditional commercial engagement remains limited and challenging as COVID-19 headwinds persist, we are encouraged by the provider and physician reception to our presence at recent scientific and medical conferences, including at ID Week 2020 in October where we hosted an exclusive educational event on respiratory viral infections and strategies for their treatment and prevention. During the quarter, we continued to experience certain COVID-19-related impacts to areas of our supply chain. Specifically, as a result of past state and local shelter-in-place orders, we experienced lower-than-normal donor collections at our FDA-approved Plasma Collection Center during the third quarter. With that being said, we, like other plasma collection organizations, have continued to see sequentially improving collections over recent weeks. and we are hopeful that these trends will continue for the balance of this year and into 2021. At present, the immune globulin market continues to expand but remains restricted by historically tight supply. We expect the tightness to continue and even be somewhat exacerbated by the persisting COVID-19 pandemic as there is a general feeling among many parts of the American public to only visit essential stores and businesses. Some people are reluctant to go to plasma collection centers and donate source plasma. In spite of this backdrop of increasing broader immune globulin market tightness, we believe that ADMA is uniquely positioned as a smaller player to provide supply and even offer greater quantities of its FDA approved IG products in the forward-looking period ahead. As a smaller player in the early stages of our manufacturing and commercial scale-up, We can say with confidence that we do not at present expect any disruption in our production throughput in the periods ahead. Beyond our revenue growth, we have several other important corporate accomplishments I would like to take a moment to highlight. First, we continue to build our inventory balance in support of further anticipated growth in the fourth quarter of 2020 and into 2021. We closed the third quarter with approximately $70 million in total inventory, up approximately 25% from $56 million at the end of the second quarter of 2020. Secondly, our net loss has been reduced considerably. We closed the third quarter of 2020 with a net loss of approximately $16.9 million, down 16% from approximately $20 million for the second quarter of 2020. As you can see, our top line revenue, inventory balance, and spending are all heading in the right directions. Additionally, the expansion of our plasma collection center network is currently progressing ahead of schedule. We opened our second center in Knoxville, Tennessee in July and began donor collections shortly thereafter, including from COVID-19 recovered donors. We anticipate receiving approval from the FDA for the Knoxville Biologics License application in mid-2021. Our ADMA BioCenters plasma collection business now has six plasma collection centers underway at various stages of development and approval, which include Kennesaw, Georgia, our current FDA approved center, and now Knoxville, Tennessee, with a pending BLA and anticipated FDA approval in mid-2021, along with four other centers currently under construction and in the architectural design and planning stages. We are extremely pleased with the progress of these initiatives, securing favorable long-term leases with ideal locations, and we believe we are on track to achieve our stated goal of opening five to ten new plasma collection centers over the next three to five years. The global demand for U.S.-sourced plasma for further manufacturing continues to outpace the available supply, and these investments into our ADMA Biocenters Plasma Collection Business Unit are anticipated to support ongoing production and growth for our end-to-end biologics manufacturing company into the future. As an update with our supply chain robustness initiatives, these projects remain on track. We continue to invest in and make progress with several supply chain robustness enhancements, including the successful onboarding of aseptic fill finish capabilities with our newly installed VanRX SA25 work cell. We are also advancing regulatory efforts for the planned capacity expansion to the 4,400-liter Bivigan plasma pool process. These and other ongoing important supply chain initiatives are designed to reduce operating costs, improve product yields and margins, increase scale, and provide for faster production cycle turnaround time, which in turn could lead to a potential reduction in working capital requirements, as well as provide us with increased control and independence from third-party vendors and contractors. We expect to submit the appropriate regulatory applications resulting from these initiatives to the FDA before the end of 2020 and into 2021, and we anticipate we will begin to see these initiatives impact our top and bottom lines potentially as early as mid-2021. With respect to our ongoing COVID-19 development efforts, We continue to work with our development partner towards a regulatory submission and potential EUA for Immunorank, a proprietary antibody assay that we believe, if approved, has the potential to provide faster, simpler, and a more cost-effective way to identify SARS-CoV-2 high-titer convalescent plasma for using both in treating COVID-19 patients as well as for creating COVID-19 hyperimmune globulins. With the Atma Biologics organization focused more than ever on commercial execution, we remain committed to tightly managing our expense structure while we work towards achieving our previously provided operating targets, including reaching revenues of $250 million or more over the next three to five years. With that, I'll now turn the call over to Brian for a review of the financials. Brian?