ADMA Biologics Inc

Good afternoon, and welcome to AdMob Biologics' first quarter 2021 financial results and corporate update talk on Wednesday, May 12, 2021. At this time, all participant lines 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 of Investor Relations and Corporate Strategy at Admiral Biologics. Please go ahead.

Welcome, everyone, and thank you for joining us this afternoon to discuss Admiral Biologics' financial results for the first quarter of 2021 and recent corporate updates. I'm joined today by Adam Grossman, President and Chief Executive Officer, and Brian Lenz, Executive Vice President and Chief Financial Officer. During 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 first quarter ended March 31, 2021 financial results. Adam will then provide some brief summary remarks before opening up the call for your questions. Earlier today, we issued a press release detailing the first quarter 2021 financial results and summarize certain first quarter achievements and recent corporate updates. 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 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 this date of this call and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligations to update any such statements except as required by the federal security laws. We refer you to the disclosure notice section in our earnings release we issued today in the risk factors section of our 2020 annual report on Form 10-K and our quarterly report on Form 10-Q for the first quarter ended March 31st, 2021 for 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 those joining us today continue to remain healthy and safe. ADMET is off to an excellent start to 2021, and the company's accomplishments during the first quarter and in the weeks thereafter establish the foundation for what we expect will be a very strong year of continued growth and asset value creation. We believe the transformative milestones achieved since the beginning of 2021 across both our biocenters plasma collection segment as well as the biomanufacturing segment meaningfully de-risked the pathway for the company to continue to deliver revenue growth as well as ongoing strategic and longer-term financial commitments to stockholders including reaching profitability no later than the first quarter of 2024. Financially, Admin exceeded analyst consensus top-line revenue forecasts, generating record revenues of $16 million during the quarter. This represents a 57% growth rate compared to the first quarter of 2020. Additionally, for the first time since the launch of Admin's IVIG product portfolio, top-line revenue growth outpaced operating spend, which enabled the company to successfully narrow both gross losses as well as net losses A trend the company anticipates will continue in the coming quarters and accelerate throughout 2022. ADMA additionally grew its total asset value to a quarter-end balance of $235.7 million, which is approximately a 13% increase quarter-over-quarter. The growth in asset value notably includes $94.1 million in inventories. which ADMA expects will support continued production ramp-up as well as quarter-over-quarter revenue growth throughout 2021. In addition to ensuring the continuity of product supply into an ongoing supply-constrained immune globulin market, we strongly believe that ADMA's asset base and future growth prospects are substantially undervalued when compared to the valuations of precedent acquisitions in the plasma product space. I will discuss this in more detail following Brian's financial remarks. In the face of pandemic-related challenges and in the context of high-profile regulatory setbacks seen elsewhere in pharmaceutical supply chains, ADMA has taken aggressive measures to strengthen its supply chain and to ensure the continuity of high-quality product supply in patient care. With seven plasma collection facilities now at various stages of approval and development including four facilities that are presently operating and collecting plasma, ADMA remains on track to have 10 or more plasma collection centers in operation by 2024. Over the remainder of 2021, ADMA expects to receive FDA approval for one plasma collection facility currently pending a biologic license application or BLA and anticipates filing BLAs for two additional plasma collection centers before year end. Supplementing its growing internal plasma collection network, ADMA disclosed an extension of its existing third-party plasma supply agreement from June 2022 through December 2022. ADMA is also in the late stages of negotiations with additional third-party plasma suppliers to further solidify the continuity of its source plasma supply. to achieve anticipated plasma supply self-sufficiency in the 2024 time period still is on track. ADMA's growing internal plasma collection network, coupled with its contractually committed third-party plasma supply obligations, positions the company well to easily access sufficient quantities of raw material source plasma to meet both ongoing as well as future production requirements. With the recent FDA approval of its 4,400-liter IVIG plasma production scale, ADMA strengthened its supply chain and enhanced its manufacturing capabilities, and the financial and strategic impact of this FDA approval cannot be overstated. The approval enables ADMA to significantly expand its production capabilities of 1,200- and 2,200-liter production scales. will at the same time keeping a substantial portion of its fixed cost structure unchanged. As the expanded capacity throughput works through the seven to 12 month IVIG manufacturing cycle, we anticipate meaningful gross margin improvements beginning potentially in the second half of 2021 and accelerating throughout 2022. We also anticipate enhanced supply chain visibility and improved working capital efficiencies as a result of this FDA approval. Additionally, we expect the approval of the 100 ml vial configuration for Bibigam to meaningfully benefit the product's go-to-market offering as it facilitates greater ease of use for the healthcare professional at the site of care. Taken collectively, ADMA remains committed to revenue growth throughout 2021 and beyond, and we believe the company now has the capabilities to generate peak revenues in excess of $300 million, which represents a 20% increase to our previously stated top line expectations. As a matter of update on the VAN-RX fill finish machine, the FDA has proceeded with the review of our prior approval supplement. However, in light of COVID-19's travel and other restrictions, the agency has been unable to expedite are required facility inspection. ADMA is actively working with the FDA to find a way to expedite the plant inspection, and the company sees a potential pathway for receiving approval during the fourth quarter of 2021. The pieces are in place for ADMA to sustain the momentum realized during the first quarter and move even closer to profitability. To our employees, we thank you for your tireless efforts and unwavering commitment It is because of these unified efforts that we are proudly able to serve our customers and to ensure the continuity of IVIG product supply for the underserved immune deficient patient populations that our life-sustaining plasma-derived therapeutics treat. We are additionally sincerely grateful to our stockholders for their continued support of our efforts to provide these life-saving products to patients in need. And we are confident that our continued operating execution will unlock meaningful value in the periods ahead. Each and every stated goal the company has set since taking over this manufacturing plant from our then CMO in June of 2017 has been met on a timely basis. We have remediated a warning letter, received multiple FDA product approvals allowing us to now commercialize three immune globulin products generating year-over-year and increasing revenues. And we have significantly expanded the capacity of this plant, which we believe will unlock value that has not yet been realized at this facility. Driven by an experienced management team, our Boca Raton facility is successfully operating as a compliant drug manufacturer. We take what we do extremely seriously, and we plan to continue to execute on our goals, Patients are counting on us, and we know it could be us or you that needs one of our products. We cut no corners. We engage our teams and we watch our operation top down to ensure continued adherence to GMP regulations. I reaffirm my commitment to our stockholders that we remain in continued operating compliance, and I truly thank my fellow admit team members for their focus, commitment, and dedication as well. With that said, I'd now like to turn the call over to Brian for a review of the first quarter 2021 financials.