Endo International plc

this is the operator today's conference is scheduled to begin shortly please continue to stand by thank you for your patience again this is the operator today's conference is scheduled to begin shortly please continue to stand by thank you for your patience Thank you. Thank you. Good day and thank you for standing by. Welcome to the ENDO International PLC 3rd Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. Please be advised that this conference is being recorded. If you require any further assistance, please press star 0. I would now like to hand the conference over to your speaker today, Laurie Park, Senior Vice President of Investor Relations and Corporate Affairs.

Please go ahead. Thank you, and good morning. Thank you for joining us to discuss our third quarter 2021 financial results. Joining me on today's call are Blaise Coleman, Endo's President and CEO, Mark Bradley, Executive Vice President and CFO, and Patrick Berry, President, Global Commercial Operations. we have prepared a slide presentation to accompany today's webcast, and that presentation, as well as other materials, are posted online in the Investors section at endo.com. I would like to remind you that any forward-looking statements made by management are covered under the U.S. Private Securities Litigation Reform Act of 1995 and the applicable Canadian securities laws and are subject to the changes, risks, and uncertainties described in the press release and in our U.S. and Canadian security filings. In addition, during the course of this call, we may refer to non-GAAP financial measures that are not prepared in accordance with accounting principles generally accepted in the United States and that may be different from non-GAAP financial measures used by other companies. Investors are encouraged to review ENDO's current report on Form 8-K, furnished with the SEC, for ENDO's reasons for including those non-GAAP financial measures in its earnings release and presentation. The reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures are contained in the earnings press release issued yesterday, unless otherwise noted therein. I would now like to turn the call over to Blaze. Blaze?

Thank you, Laurie. Good morning, everyone, and thank you for joining us. We're pleased to report strong financial performance during the third quarter, which exceeded our expectations and was driven by outstanding execution across all of our businesses, as well as continued progress against our strategic priorities. Based on the strength of our year-to-date performance and expectations for the remainder of the year, we are raising our 2021 full-year financial guidance. Turning to slide three, our strategic priorities continue to guide all that we do as we work to transform our company. During the third quarter, we made progress against all three of those priorities. In expand and enhance our portfolio, we continue to successfully deliver on our quo launch plan, drive Zyaflex volume growth through focused commercial execution and investments, progress our internal product pipeline, and successfully execute new launches. And to reinvent how we work, we continue to advance our business transformation initiatives. including the sale of our manufacturing facility in Chestnut Ridge, New York, and pending sale of our Irvine, California facility. And be a force for good, we continue to make progress across our many initiatives in support of our ambition to adopt the more sustainable practices that benefit all of our stakeholders. Endo team members are proud of the positive impact our products have on the lives of patients we serve. and on the positive impact we have in the communities where we live and work. Moving to slide four, this is a snapshot of our segment and consolidated revenues and our adjusted EBITDA for the quarter. Third quarter enterprise revenues of $772 million increased by 22 percent compared to the prior year, driven by growth in our sterile injectables, generic pharmaceuticals, and branded pharmaceutical segments. Reported third quarter adjusted EBITDA of $387 million increased by 35 percent compared to the prior year. This increase was mainly due to higher consolidated revenues and favorable changes in product mix and was partially offset by higher adjusted operating expenses due to our increase in ZioFlex and Quo commercial investments. Third quarter 2021 consolidated revenues and adjusted EBITDA exceeded our previously communicated expectations due to better-than-expected performance across our sterile injectable segment, primarily driven by vasostrict, and our generic pharmaceuticals segment. Turning to slide five, third-quarter revenues from our branded pharmaceutical segment increased by 3 percent compared to the prior year. This increase was driven by a 16 percent increase in our specialty products portfolio compared to the same quarter last year. Xiflex revenues increased approximately 20% in the third quarter compared to the prior year, driven by strong underlying demand. Third quarter 2021 Xiflex revenue growth was partially impacted by a slowdown in elective procedures, patient flow, and workforce disruptions in physician offices, mainly as a result of the COVID-19 Delta variant. We anticipate improving conditions throughout the fourth quarter, and we remain very encouraged by the continued strong interest of patients willing to seek treatment. Revenues for our sterile injectable segment increased by 37 percent compared to the third quarter of 2020 and exceeded our expectations. This was driven by a 65 percent increase in vasostrict revenues compared to the prior year, mainly due to higher utilization driven by the COVID-19 Delta variant, combined with a return to normal pre-COVID-19 population mobility and activity trends. We anticipate that demand for vasostrict will return to more normalized levels in the fourth quarter of 2021 as COVID-19 related hospitalizations decline. On the vasostrict litigation front, our appeal of the district courts non-infringement finding was filed in September and remains pending. Our full-year financial guidance assumes continued VASA strict market exclusivity for the rest of the year. However, we continue to take the necessary steps to prepare for a potential near-term launch at risk. It is worth noting that while we cannot comment on the specific terms of any of our executed VASA strict settlement agreements, it is commonplace for settlement agreements to include acceleration clauses that allow launches by other filers once there's been a launch at risk, which may also trigger an authorized generic launch. Moving to slide six, revenues from our generic pharmaceutical segment increased by an impressive 29 percent in the third quarter compared to the prior year. Third quarter generic pharmaceutical segment revenues surpassed our expectations, mainly due to better than expected Luby ProStone branded generic conversion, coupled with delayed competition on certain key generic products. We're very pleased to have received FDA approval for generic Varenicline during the quarter. Our product is currently the only FDA-approved generic Varenicline tablet. While still early days with the launch, we have a progressive supply plan that we expect will enable us, over time, to make this product available to a larger portion of the market. Finally, international pharmaceutical segment revenues for the third quarter were comparable to the third quarter 2020 revenues. On slide seven, a key component of our Xiflex maximization strategy includes increasing patient awareness through expanded promotion to empower patients to seek non-surgical options, combined with HCP promotional activities, physician education, and injection training. On this front, we're excited to have an integrated, branded, direct-to-consumer campaign for Peyronie's indication that was launched in late October. We believe the new multi-channel integrated campaign will help drive patients to find a specialized urologist and to empower men with Peyronie's to request Zyaflex. This launch represents an important milestone as it is the first branded direct-to-consumer television campaign for Zyaflex and the company. The campaign will utilize multiple media channels and will be pulled through with an integrated HCP effort from our capable men's health field sales force. This campaign is representative of the consumer activation capability we've built over the last few years. During the recent Sexual Medicine Society of North America meeting, we were able to share new post-hoc data about Xiflex in treating PD. The data analysis points to the potential benefits of completing the full Xiflex treatment course for PD, and it further demonstrates to the HCP community our ongoing commitment to invest in this important treatment and condition. Lastly, our Xiflex maximization plan continues to be supported with ongoing consumer activation activities centered on creating condition awareness of Dupuytren's contracture. We're in the process of evolving our disease state awareness campaign to its next iteration, featuring multiple real people living with the condition. We look forward to launching a new unbranded campaign early next year. Turning to slide eight, in our medical aesthetics business, we remain focused on the successful launch of Quo, building brand awareness and driving trial and adoption. Our launch efforts are centered on building a new category within medical aesthetics by emphasizing product education and the importance of patient selection that leads to positive patient outcomes while building practice success with our onboarded accounts. We are pleased with our progress and the positive feedback we are receiving from both the medical aesthetics community and the women who have been treated with Quo. In terms of our launch execution, we continue to take a disciplined and progressive approach to establishing a base of Quo injectors, and to date, we have trained and certified greater than 1,300 accounts. To match interested consumers with treating medical aesthetics practices, we've activated a Find a Specialist feature on our Quo website with robust activity. This is a good early indicator of potential future patient demand for Quo, as well as an example of our commitment to building a category and supporting demand generation. Our PR and media planning continues to generate excellent brand awareness and consumer enthusiasm in the marketplace. Quo recently made the cover of a lore magazine under the headline, The Science of Beauty. And later this month, we plan to host a media event along with one of our HCP partners to reach Latina women with our Quo product offering. Additionally, we plan to launch our Quo direct-to-consumer campaign titled But First next year with the initial teaser campaign recently relaunched. Our approach will continue focusing on supporting practices to successfully launch and integrate Quo to achieve positive patient outcomes and increase trial and adoption. We are pleased that based on our ongoing ATU market research survey of aesthetic clinicians, Quo is already leading the cellulite treatment category with the highest level of unaided awareness. Moving to slide nine and discussing our ongoing branded segment clinical studies and pipeline, starting with Quo, our data generation plans remain focused on dosing, injection technique, durability, and responses in target patient populations. For example, as we've previously highlighted, our 305 Phase 3B RILS study looked at QUEL effectiveness in a real-world population, as well as thigh injection technique and overall investigator experience. At day 90, greater than 90 percent of investigators perceived improvement in cellulite appearance, and 90 percent of investigators agreed or strongly agreed to incorporate QUEL into their practice. Results and analysis from these studies are key to our publication and presentation strategies. We continue to make progress in our Xiflex clinical development programs. With respect to plantar fibromytosis, based on our interim analysis of the proof-of-concept study, we plan to progress this program with the initiation of a Phase II study later this year. In terms of adhesive capsulitis, our Phase IIb study interim analysis is anticipated towards the end of the year. We believe both plantar fibromytosis and adhesive capsulitis represent opportunities to bring innovative treatment options to address potential large unmet needs for patients who are seeking non-surgical approaches to treatment. And both development programs are important components of our Xiflex maximization plan. Turning to slide 10, we continue to evolve our R&D pipeline and manufacturing capabilities to support the introduction of an increasing number of sterile products that focus on the evolving needs of our customers. As of the end of the third quarter, we have approximately 40 R&D projects in our pipeline, an increase of more than 30 percent since the beginning of the year, which is mainly driven by an increase in sterile injectable projects. Overall, greater than 85 percent of our R&D pipeline consists of projects across the sterile injectable product continuum. with approximately two thirds and ready to use in other more differentiated products. Year to date, we've launched five products and expect to launch approximately 10 products in 2021 across our sterile injectables and generic pharmaceuticals segments. In addition to our organic efforts to enhance and expand our portfolio, we continue to remain active on the business development front, remain focused on opportunities in our core areas of growth aimed at enabling us to further leverage our existing capabilities. We have taken and will continue to take a disciplined approach to deploying capital and business development opportunities that align with our strategy. Now, let me turn the call over to Mark to further discuss the company's financial results and our financial guidance. Mark?