ANI Pharmaceuticals, Inc.

Good day, everyone, and welcome to today's A&I Pharmaceuticals first quarter 2021 earnings release call. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question and answer session. You may register to ask a question at any time by pressing the star and one on your touchstone phone. You can always remove yourself by pressing the pound key. Please note today's call is being recorded. and it's now my pleasure to turn the conference over to Lisa Wilson. Please go ahead.

Thank you, Operator. Welcome to A&I Pharmaceuticals Q1 2021 Earnings Results Call. This is Lisa Wilson of Insight Communications, Investor Relations for A&I. With me on today's call are Nikhil Lalwani, President and Chief Executive Officer, and Stephen Carey, Chief Financial Officer of ANI. You can also access the webcast of this call through the investor section of the ANI website at ANIFarmaceuticals.com. Before we get started, I would like to remind everyone that any statements made on today's conference call that express a belief, expectation, projection, forecast, anticipation, or intent regarding future events and the company's future performance may be considered forward-looking statements as defined by the Private Securities Litigation Reform Act. These forward-looking statements are based on information available to A&I Pharmaceuticals management as of today and involve risks and uncertainties, including those noted in our press release issued this morning and our filings with the SEC. Such forward-looking statements are not guarantees of future performance. Actual results may differ materially from those projected in the forward-looking statements. ANI specifically disclaims any intent or obligation to update these forward-looking statements except as required by law. The archived webcast will be available for 30 days on our website, ANIFarmaceuticals.com. For the benefit of those who may be listening to the replay or archived webcast, this call was held and recorded on May 7th, 2021. Since then, ANI may have made announcements related to the topics discussed, so please reference the company's most recent press releases and SEC filings. And with that, I'll turn the call over to Nikhil Lalwani.

Thank you, Lisa. Good morning, everyone, and thank you for joining our call. The first quarter of 2021 was an important period for us as we made significant progress towards our goal of building a sustainable biopharmaceutical company to serve patients in need. We defined four pillars of our strategy and achieved important milestones, including substantial work on finalizing the Quertrofen SNDA refiling and commercial team build-out, signing definitive agreement for acquisition of Novidium to enhance generic R&D and acquisition of the NDAs from Sandoz to expand our branded products portfolio. This morning, I will speak to these growth drivers and outline our plans to achieve our goals. Before I get into that, I hope that you and your families are safe and well, and our thoughts are with those around the world facing the crisis caused by this destructive virus. Next, Let me share a couple of thoughts about the general operating environment. The biopharmaceutical industry has simultaneously been at the center of efforts to treat and prevent COVID-19 and has also been vulnerable to its overall impact. Through the first quarter of 2021, there was a continued decline in prescriptions across branded and generic segments. According to IQVIA, the generic segment declined 15% year-over-year when adjusted for 90-day supply. This dynamic, combined with seasonal factors, has contributed to softness in prescription levels for ANI's branded and generics products. In the first quarter 2021, ANI achieved net revenues of $54.5 million compared to $49.8 million in Q1 2020 and delivered adjusted non-GAAP EBITDA of $18.9 million. I would like to thank the ANI team, our partners, suppliers, customers, and advisors for their support in ensuring our medicines reach patients in need and we make strides forward on our overall strategy. On our last quarterly call, I laid out ANI's four pillars for future growth. Now, I'd like to map our recent progress to each of these foundational pieces. First, Our top priority remains centered on building a successful Cortrophin gel franchise. We see Cortrophin as a transformational opportunity for the company. Cortrophin represents a new brand product with only one competitor in the same class, achieving $770 million in revenues in 2020. We are eager to bring this much needed product to patients in need. This launch has the potential to dramatically change the size and scale of our company. We continue to make solid progress achieving the key project milestones and are on track to refile our Supplemental New Drug Application, or SNDA, in this quarter. We have every confidence that our steam submission package will be robust and comprehensive. In February, we brought on Chris Mutz as our Chief Commercial Officer and Haider Rare Diseases to spearhead our launch strategy and commercial plan. He brings deep experience in the successful commercialization of rare disease therapies at Alexion and Merck. He is currently building his team and most recently brought on board Bill Imrotska as VP of Market Access and Sherry Krasinski as VP Marketing to drive launch readiness. Our second pillar is to strengthen our generics view with enhanced development capability. Last quarter, we announced our agreement to acquire Nividium, and we are on track to close that transaction in the second half of this year. We have filed a definitive proxy for a shareholder vote on June 2nd on the financing of this transaction, i.e., issuance of greater than 20% of equity to the sellers and to M% capital. As Steve will discuss later, we are on track to secure our term loan refinancing, and finally, We are in the process of gaining FDC approval. As we have outlined, there are many reasons why we believe the NVIDIA acquisition truly represents a pivot point for A&I. Our company moves from a heavy reliance on business development deals to a company with a robust internal R&D engine. The investment thesis of adding a best-in-class R&D engine with an attractive list of new launches is already playing out since our announcement NVIDIUM has received several product approvals, including limited competition opportunities, such as Somotidine solution, a generic version of Pepsid, and generic Flufenazine. For 2021 and 2022 alone, NVIDIUM has more than 25 anticipated product launches, including some with competitive generic therapy designation. Furthermore, they have more than 30 additional products under development. We are pleased that their leadership team with its proven track record of success will be joining the ANI family to drive growth. Moving now to our third pillar, maximizing the value of established brands through programmatic business development and innovative access and go-to-market strategies. In early April, we signed and closed an accretive deal to acquire the NDAs for Oxistat, Verigen, and Pandell. and Leanda for a Plexicon from Sandoz. The acquisition further leverages our innovative brand commercialization infrastructure as well as our North American manufacturing footprint. Importantly, we are ensuring that patients in need continue to have access to these products. We have already begun selling these high quality dermatology products with generated net revenues of 13.2 million in 2020. As part of this acquisition, We also entered into a multi-year manufacturing and supply agreement for Oxistat, Pendel, and Apexicon. We plan to transfer the manufacturing packaging of these products to our own manufacturing sites in the future. One note on our manufacturing facilities and capabilities. As the pandemic continues here in the U.S. and rages in other parts of the world, our North American manufacturing footprint remains increasingly irrelevant as supply chains become more localized. We are very pleased with our progress to date as we execute on these critical strategic initiatives. With that, I'll turn the call over to Steve to discuss our Q1 2021 financials, as well as provide guidance for the year.