Cumberland Pharmaceuticals Inc.

Good afternoon and welcome to Cumberland Pharmaceuticals First Quarter 2024 Financial Report and Company Update. This call is being recorded at Cumberland's request and will be archived on the company's website for one year from today's date. I would now like to turn it over to Molly Agus, Account Supervisor at the Dalton Agency, who handles Cumberland's communications. Molly, please go ahead.

Hello, everyone. Thanks for joining us today. This afternoon, Cumberland issued a press release announcing the company's financial results with an operational update for the first quarter of 2024. The release, which includes the related financial tables, can be found on the company's website at www.cumberlandpharma.com. Management will share an overview of those financial results during today's call. They'll also provide an overall company update, including a discussion of Cumberland's brands, pipeline, and partners. Participating in today's call are A.J. Kazemi, Cumberland's Chief Executive Officer, Todd Anthony, Vice President, Organizational Development, and John Hamm, Chief Financial Officer. Please keep in mind that their discussions may include forward-looking statements as defined in the private securities reform act. Those statements reflect the company's current views and expectations concerning future events and may involve risks and uncertainties. There are many factors that could affect Cumberland's future results. including natural disasters, economic downturns, public health epidemics, international conflicts, and others that are beyond the company's control. Those issues are described under the caption Risk Factors in Cumberland's Form 10-K and any additional updates filed with the SEC. Any forward-looking statements made during today's call are qualified by those risk factors. Despite the company's best efforts, actual results may differ materially from expectations. So information shared on this call should be considered current as of today only. Please remember that the company isn't responsible for updating any forward-looking statements, whether as a result of new information or due to future developments. During today's call, there will also be references to several of Cumberland's marketed brands. Full prescribing and safety information for each brand is included on the individual product websites. And you can find links to those sites on the corporate website at www.cumberlandpharma.com. The company will be providing some non-GAAP financial measures with respect to its performance. An explanation and reconciliation to GAAP measures can be found in the financial tables of the earnings release that was issued earlier this afternoon. If you have any questions, please hold them until the end of the call, at which point we'll be happy to answer them. Management is also prepared to hold a follow-up conversation after the call, if you prefer. With that introduction, I'll turn the call over to Cumberland's Chief Executive Officer, A.J. Kazemi.

Thank you, Molly, and good afternoon, everyone. We appreciate your joining us today as we share how the year has gone so far. As Molly mentioned during today's call, we'll provide a company update and a review of our financial results for the first quarter ending March 31, 2024. The first quarter came in generally as expected, given the backdrop of a higher interest rate environment and typical first quarter consumer buying patterns. Recall our first quarter sales are usually lighter as patients work through their new insurance deductibles before purchasing more expensive medicines. Also, our sales in Q1 this year were impacted by wholesaler buying patterns, which do fluctuate during the year. However, it's important to note that the overall demand for our brands was steady during the period. And for that reason, we believe it's best to evaluate our financial performance on an annual basis. We remain very optimistic about our company's fundamentals and future, given the number of ongoing positive developments, which we'll elaborate on during today's call. And finally, we believe we are still on track to post double digit revenue growth and positive cash flow from operations in 2024. You see, Cumberland has built a portfolio of FDA approved brands with outstanding safety and efficacy profiles that can make a difference in patients' lives. These are valuable brands with attractive margins. We continue to build our portfolio of innovative and differentiated products through a multifaceted strategy that includes both the development of new candidates as well as the acquisition of established brands. Our resulting diversified product line has enabled us to weather external challenges while our team remains responsive to the evolving marketplace. I'd next like to share several updates regarding our products, including a number of growth opportunities. We're implementing a strategy to increase the overall awareness of our products and their attributes throughout the medical community. In March, a special report was published in anesthesiology news, general surgery news, and pharmacy practice news, which presented the growing amount of clinical data supporting the use of Caldolor, our ibuprofen, as a standard of care for the treatment of pain and fever in adults, children, and infants. As a reminder, FDA approved expanded labeling for Caldolor in 2023 to include its use in patients from three to six months of age. Additionally, recall that the federal No Pain Act was passed last year which is designed to provide special favorable reimbursement for non-opioid products like Caldolor. We look forward to learning more this year regarding Caldolor's inclusion and reimbursement in preparation for the application in early 2025. This could be a very meaningful revenue growth opportunity for Caldolor. Regarding Vibativ, our potent antibiotic, we're pleased to announce the launch this quarter of new product packaging. This additional presentation is designed to overcome a barrier at smaller hospitals and infusion centers that use less of the product at a time in order to help them manage their investment and workflow associated with the product. Turning to Crystallose, our prescription strength laxative, we continue to build on the growing number of states where it has favorable Medicaid coverage. And meanwhile, we also continue to feature Sancuso through our recently expanded oncology sales division in order to support patients by helping address certain side effects associated with their chemotherapy cancer treatments. And additionally, we continue to work with partners in their efforts to advance our potent antibiotic Vibative in several international markets, which can contribute to the brand's growth in the future. Tabook Pharmaceuticals has obtained final approval for Vibative in Saudi Arabia and will next be discussing with them their plans for the product in that market. And Skyclone Pharmaceuticals Our partner for the Chinese market continues to respond to the regulatory inquiries there as they seek approval for Vibative in their country. DB Farm, our partner in South Korea who also distributes Caldor there, did receive an update during the first quarter on their submission to approve and distribute Vibative in their country. The Korean regulatory authorities did not yet approve the submission and indicated that some additional manufacturing information will be required, and we'll work with DB Farm to address. Regarding our financial performance during the first quarter, we recorded $8.5 million in net revenues, and again, overall demand for our brands was steady during the period, and we therefore continue to suggest evaluating our performance on an annual basis. So, with that overview, I'd now like to turn to Todd Anthony, Cumberland's Vice President, Organizational Development, to discuss our team and our brands. Todd? Thank you, AJ.