ANI Pharmaceuticals, Inc.

Good day, everyone, and welcome to today's ANI Pharmaceuticals, Inc. Second Quarter 2024 Earnings Results Call. Please note this call is being recorded. After the speaker's opening remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press the star key followed by the number 1 on your telephone keypad. If you would like to withdraw yourself from the question and queue, please press star 2. It is now my pleasure to turn the conference over to Lisa Wilson. Please go ahead, ma'am.

Thank you, Katie. Welcome to A&I Pharmaceuticals Q2 2024 Earnings Results Call. This is Lisa Wilson of Insight Communications, Investor Relations for A&I. With me on today's call are Nikhil Lawani, President and Chief Executive Officer, Steve Carey, Chief Financial Officer, and Chris Mutz, Senior Vice President and Head of A&I's Rare Disease Business. 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 ANI 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, A&IFarmaceuticals.com. For the benefit of those who may be listening to the replay or archived webcast, this call was held and recorded on August 6, 2024. Since then, A&I 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.

Nikhil Lalwani Thank you, Lisa. Good morning, everyone, and thank you for joining our second quarter earnings call. We are delighted with ANI's accomplishments in the second quarter. We achieved both record revenues and a major milestone in our ongoing efforts to expand the scope and scale of our rare disease business with our proposed acquisition of Almera Sciences. The company continues to rise to each challenge and goal, and I'm proud of the team's ability to drive sustained long-term growth while never losing sight of our purpose of serving patients, improving lives. During the second quarter, BNI generated revenues of $138 million, an increase of 18% over the second quarter of 2023. Adjusted non-GAAP EBITDA was $33.2 million, and adjusted non-GAAP EPS was $1.02. Based on our strong second quarter results and the continued momentum that we're seeing across the business, we're pleased to raise our full year 2024 guidance, which Steve will discuss later in the call. Accelerating demand for our lead rare disease acid, purified cortofan gel, and solid growth for generics drove our robust top-line performance. which more than offset the expected established brand's business performance. Protrophin gel generated $49.2 million in revenues during the quarter, up 102% over the prior year quarter and 33% over the first quarter of 2024. The second quarter represented the highest number of both new patient starts and unique prescribers since launch in January 2022. We continue to have momentum in the addition of new prescribers and robust growth from existing prescribers, and volumes increased across all targeted specialties, virology, rheumatology, nephrology, albinology, and ophthalmology. We are pleased to report that the areas of strategic investment behind cortofan gel that we announced earlier this year and late last year including expanding our pulmonology sales team, launching a targeted ophthalmology sales team, and actively promoting the acute gouty arthritis flares indication have been yielding positive results. Our ophthalmology sales team has a strong start and drove significant growth in prescriptions and new patient starts in the second quarter. We also saw particularly strong year-over-year and quarter-over-quarter growth for acute gouty arthritis flares. Corprofen gel is the only ACTH product approved for this indication. As a reminder, we began promotional activities for the acute gouty arthritis flares indication in late 2023. More than 9 million people in the U.S. are affected by gout, and some of these experience acute gaudy arthritis flares as a symptom of their underlying disease. For some of these patients, cortofan gel may be an appropriate additional treatment option for their flares. We have seen increasing momentum in physicians adopting cortofan gel for patients with acute gaudy arthritis flares who have not responded adequately to conventional therapies. We continue our efforts to enhance the convenience and remove pain points for patients starting on ACTH and the healthcare providers who treat them. In the fourth quarter of 2023, we introduced the one ML version of cortofan gel to meet the needs of physicians who desired a smaller configuration of ACTH for certain patients, such as those with acute gouty arthritis flares. Today, We are pleased to report for the first time that we are nearing the completion of development of a 1ml pre-filled syringe offering further benefits to patients and physicians. We plan to file for FDA approval of the pre-filled syringe in the second half of 2024 and are excited about the potential of this product. We look forward to launching this product in the first half of 2025. Turning now to our generics business, which delivered another strong quarter with revenue of $74 million, an increase of 17% over the second quarter of 2023, and 5% over the first quarter of 2024. The solid performance reflected strength in our base business, coupled with contribution from new product launches. We launched four new products in the second quarter, each into limited competition markets in generics. We have launched three new products so far in the third quarter and have a number of products pending approval that we expect to launch in the second half. We made substantial progress on bringing online the significant capacity expansion at our New Jersey site and believe all 15 new manufacturing suites and the new QC lab will be fully operational in the second half of 2024. The New Jersey site expansion will support the future growth of our genetics business. Revenue for established brands was $14.9 million during the quarter, a decrease of 49% from the prior year period. The performance was anticipated and in line with our expectations and guidance. As a reminder, we noted on the first quarter call in May that we did not expect the tailwinds arising from competitor supply dynamics to persist beyond the first quarter. In June, we delivered a major milestone in our growth strategy with announcing the proposed acquisition of Alamaro Sciences. This highly synergistic transaction will add two commercial assets in ophthalmology to our rare disease portfolio and more than $100 million in highly durable branded revenue annually. The acquisition is aligned with the M&A strategy we laid out over the past several quarters. Specifically, this transaction will expand the scope and scale of our rare disease business and strengthen one of our priority therapeutic areas of ophthalmology, which is also a key specialty for our lead rare disease asset, cortofan gel, and the overall ACTH market. The deal will provide ANI's two durable assets with double-digit growth. With Almera, ANI's rare disease segment would account for approximately 45% of the total company revenues on a pro forma 2024 basis. and we expect rare disease to be the largest driver of the company's future growth. From a financial perspective, we expect high single-digit to low double-digit accretion in adjusted non-GAAP EPS in 2025, with substantial accretion thereafter. Integration planning is well underway, and the transaction remains on track to close later this quarter. Now, I'd like to turn the call over to Chris Mutz, our head of rare disease, to discuss the Alimera products and transaction in more detail.