Amneal Pharmaceuticals, Inc.

Hello and welcome to today's Amniel 2Q 2022 earnings conference call. My name is Elliot and I'll be coordinating your call today. If you'd like to register a question during the presentation, you may do so by pressing star followed by one on your telephone keypad. I would now like to turn the call over to Amniel's Head of Investor Relations, Tony DiMeo.

Good morning and thank you for joining Amniel's second quarter 2022 earnings call. Today we issued a press release reporting our financial results. The press release and presentation are available at amnial.com, and a replay of this call will be posted after the call. Certain statements made on this call regarding matters that are not historical facts, including but not limited to management's outlook or predictions, are forward-looking statements that are based solely on information that is now available to us. Please review the section entitled Cautionary Statements on Forward-Looking Statements in the earnings presentation and our SEC filings for discussion of factors that may impact our future performance. We also discussed non-GAAP measures. Important information on our use of these measures and reconciliation to U.S. GAAP may be found in the earnings presentation. On the call today are Chirag and Shintzu Patel, co-CEOs, Tasos Konideras, CFO, Andy Boyer, Generics, Harsher Singh, Biosciences, and Jason Daly, Chief Legal Officer. I will now turn the call over to Chirag.

Thank you, Tony. Good morning, everyone. Our solid second quarter performance reflects acceleration from Q1 as expected. Q2 revenues were $559 million, up $61 million sequentially, and adjusted EBITDA was $135 million, up $35 million sequentially. Across all three segments, we saw acceleration in performance from Q1. The top line growth versus the prior year. The core business is strong and performing well. Since the last start of the year, there are two isolated factors that are different from our initial expectations. First, there was the accounting policy change for R&D milestone payments. There was a product opportunity in return aware, which was expected to contribute in the second half that did not materialize as anticipated. These items are not reflective of the underlying strength of the core business, which is performing better than our expectations. In addition, despite more than anticipated inflationary pressures, especially in freight, We managed to continue to deliver efficiencies to drive sequential growth. TASOs will provide more details shortly. As a result, we are revising our full year guidance for adjusted EBITDA. That said, we are reaffirming our full year revenue guidance as we continue to expect mid single digit top line growth in 2022. We are enthusiastic about the acceleration in financial performance we saw in Q2 versus Q1, which we expect to continue in the second half. As we launch new products in high-growth areas, such as injectables, complex generics, biosimilars, and specialty, we expect to drive higher levels of financial performance and acceleration as these key catalysts are additive to our current financial profile. This month marks the three-year anniversary since Shintu and I returned to MNEO. In 2019, net revenue was $1.6 billion and adjusted EBITDA was $339 billion. Since then, the team has done an incredible job reinvigorating new product innovations, improving operational execution, driving commercial success. In 2022, we expect about $2.2 billion in net revenue and $500 to $520 million in adjusted EBITDA and have a durable, thriving portfolio that's diversified across specialty, injectable, complex genetics, biosimilars, and international, with a number of key catalysts ahead. Looking forward, as we execute our growth strategy, We expect further acceleration in financial performance. The growth engine is set. Let's go through each area of the business. Starting with generics, new launches in our diversified portfolio of increasingly complex medicines is driving durable top-line performance. With our focus on complex and higher barrier products, over half of generics revenue is now non-oral solids. We see that increasing over time as currently 90% of our pipeline is non-oral solids. In terms of the total company, oral solids generics represent one-third of total revenues and continues to shrink. We expect continued growth in generics driven by our portfolio of complex products. Moving to injectables. This is a key near and long-term growth driver. We now expect $170 million plus revenue in 2022, representing over 35% growth. We are scaling this business with expanded capacity, capabilities, and portfolio. We believe these initiatives will drive us well over $300 million by 2025. In biosimilars, after many years of hard work by us and our partners, we are only a few months away from beginning commercialization of three important oncology biosimilars. We estimate the market size for these three products based on net revenue is approximately $4 billion, of which half is biosimilars. For us, we see peak sales over $200 million plus in the next two to three years. The biggest opportunity is Alemsys, our Bavazizumab biosimilar. From a go-to-market perspective, we are focused on oncology clinics, integrated health systems, and specialty pharmacies. We believe the key value propositions to the market are a customer-centric service model, effective reimbursement, and offering a suite of oncology products for clinicians. We are working to expand our biosimilar portfolio with additional molecules where we can be early to market and we look to be vertically integrated over time. MNIL is well positioned for long-term success in the fast-growing $28 billion U.S. biosimilar industry. In our healthcare distribution business, we expect continued solid growth to be driven by strong commercial and operational execution as we expand across multiple distribution channels, including federal government healthcare market, our direct distribution channel, and unit dose. In international, we are leveraging our portfolio of complex generics, injectables, specialty, and biosimilar products globally. We believe this strategy will add considerable revenue and profits in time as we work with partners for distribution or utilize existing infrastructure. In China, we expect to begin commercialization of multiple products early next year. In India, we are expanding our local presence with our own label. India is a $25 billion pharmaceutical market, and we are encouraged by our early traction this year as we begin our commercial effort in the market. Around the rest of the world, we are pursuing targeted distribution opportunities with strategic partners, and we look forward to sharing more information soon. In specialty, we are driving commercial execution of our key branded products and advancing our pipeline. We expect continued strong growth from Reiteri in Parkinson's and Unitroid in Hypo thyroidism. In addition, LIVISPA for spasticity successfully launched in June as our pipeline delivers new branded products, including IPX203 and DHE Auto Injector in 2023 and K127 in 2024. We see our specialty business expanding very meaningfully. With that, I'll hand it over to my younger brother, Chinti.