Collegium Pharmaceutical, Inc.

Good day and welcome to the Q2 2019 Collegium Pharmaceutical earnings conference call. I will now turn the call over to Alex Vassala. You may begin.

Welcome to the Collegium Pharmaceutical second quarter 2019 earnings conference call. This is Alex Vassala, Head of Investor Relations for Collegium. I am joined today by Joe Schifoni, our Chief Executive Officer, Paul Brantley, our Chief Financial Officer, and Scott Dreyer, our Chief Commercial Officer. Before we begin today's call, we want to remind participants that none of the information presented today is intended to be promotional and that any forward-looking statements made today are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. We would caution that such forward-looking statements involve risks and uncertainties, including and without limitation, the risks that we may not be able to successfully commercialize, expand the ER, and the Nucenta franchise, and that we will incur significant expense and may not prevail in current or future opioid industry litigation and investigations, patent infringement litigation or other litigation pertaining to our products. These risks and other risks of the company are detailed in the company's periodic reports filed with the Securities and Exchange Commission. Our future results may differ materially from our current expectations discussed today. Our earnings press release and this call will include discussion of certain non-GAAP information. You can find our earnings press release, including relevant non-GAAP reconciliations, on our corporate website at collegiumpharma.com. I will now turn the call over to Collegium CEO, Joe Schifoni.

Thanks, Alex. Good afternoon and thank you everyone for joining the call. We're pleased with the progress that we made in the first half of 2019 versus our key strategic and operational priorities, and we are on track for 2019 to be a breakthrough year for Collegium Pharmaceutical. The second quarter marked another quarter of growth for Collegium, capping a strong first half performance. Total net revenue for the first six months was $149.6 million, which represents a 9.3% increase over the first half of 2018. Extansa ER delivered strong year-over-year growth driven by the 13 new exclusive ER oxycodone payer wins that came online at the beginning of the year. Compared to the first half of 2018, Extansa ER total prescriptions grew 60% and Extansa ER total net revenue increased 51% to $51.2 million. Driven by operational stability and execution, We expect Xtansa ER to continue to grow over the remainder of 2019 at a moderated pace compared to the first half of the year. With respect to the Nusenta franchise, we saw signs of stability in the second quarter. Sequentially, total prescriptions and market share were flat compared to the first quarter of 2019. We believe that Nusenta ER volumes will grow modestly over the remainder of 2019, and we expect Nusenta IR to decline in line with the IR market. Importantly, and as we said at the start of the year, we believe the organization is sized appropriately to maximize the potential of the portfolio. We're committed to leveraging, not growing Collegium's cost structure, and evidence of that commitment was reflected in lower sequential quarter and year-over-year quarterly operating expenses. As we strive to become the leader in responsible pain management, we recognize that our most important brand is Collegium Pharmaceutical. Our entire organization works hard every day to differentiate Collegium Pharmaceutical and to earn the trust and respect of our various stakeholders. Recent headlines related to opioid litigation developments reinforced the importance of good corporate citizenship and the need to operate from a position of trust and accountability, putting the best interests of patients and our communities at the forefront of all that we do. Quantitative market research conducted in the second quarter showed that among our targeted health care providers, Collegium was ranked second only to Pfizer as a leader in responsible pain management. A testament to the quality and professionalism of our team and to the growing recognition of Collegium's commitment. As part of that same research, Collegium was rated number one based on ethical business practices, a belief that the company's product portfolio and materials, services and websites support responsible pain management, and a positive reputation among the public and medical community. As we continue to build awareness around our commitment to being the leader in responsible pain management, we recognize the importance of leading with the science and that evidence-based outcomes are a key component to differentiating our brands. Since joining the team in the spring, our Chief Medical Officer, Dr. Richard Malamud, has been evaluating our scientific communications efforts in developing a plan for future enhancements. We now have a comprehensive publication plan in place and will have a strong presence at this year's Pain Week in September, the largest U.S. pain conference for clinicians dedicated to pain management. The presentation of new real-world data regarding Expanse ER and the Nucenta franchise, including data derived from surveillance systems that track abuse and diversion, allow us to enhance our discussions with numerous stakeholders, including payers. Before I conclude my opening remarks, I would also like to take a moment to address the ongoing industry-wide opioid litigation. Prior to doing so, I want to emphasize that our organization stepped into this space in 2016 at a time when others began to step out because of a belief that Expanse ER and our proprietary Deterrex technology has the potential to make a positive difference in the lives of people suffering from pain and could play a role in responsibly addressing the opioid epidemic. As of today, there are over 2,000 lawsuits against opioid manufacturers, distributors and other participants in the supply chain brought by various plaintiffs from cities to states to attorneys general and other parties. Of these, we are aware of 27 in which we are currently named. Where we have an opportunity to do so, we are pursuing dismissal based on Collegium's late entry to the market and the absence of allegations that we engaged in conduct that could contribute to the crisis. To date, Collegium has been dropped from eight of the 11 lawsuits currently consolidated in the Ohio multi-district litigation that we have been named in and were awaiting dismissal in two cases brought against us in the Pennsylvania State Courts. Collegium was never a party to the prominent Oklahoma AG suit that has recently garnered national attention and Collegium was dismissed from an opioid lawsuit in Arkansas State Court. We are not named in any case in the multi-district litigation that is a track or bellwether case and do not expect to have involvement or engagement in the MDL for some time. Finally, we did not assume any liability for new sense of promotion or sales that occurred prior to January 2018. Instead, any such liability is retained by Assertio. While we typically refrain from commenting on litigation of any sort, We realize that this is an area of ongoing inquiry due to the high-profile nature of the opioid epidemic and the seriousness of the allegations made against various parties in the industry. Today's commentary is intended to address some of the common questions we have been receiving from the investment community. However, beyond these brief remarks, we will have no further comment on this topic during this call and would refer you to our quarterly and annual reports filed with the SEC which contains both detailed descriptions of the status of litigation matters as well as descriptions of the risks associated with them. Looking to the balance of the year, we remain focused on execution. We are encouraged by but not satisfied with our accomplishments in the first half of 2019 and we have a lot of work to do in the second half of the year. I am confident that Collegium has the right capabilities and most importantly, the right people in place to make it happen. And at this time, I would now like to hand the call over to Paul Bramley for a discussion of the financials.