Option Care Health, Inc.

Thank you for standing by, and welcome to the Option Care Health First Quarter 2022 Earnings Conference Call. At this time, all participants are on listen-only mode. After the speaker's presentations, there will be a question-and-answer session. To ask a question at that time, please press star then 1 on your touchtone telephone. As a reminder, today's conference call is being recorded. I would now like to turn the conference over to your host, Mr. Mike Shapiro. Sir, you may begin. Thank you.

Good morning. Before we begin, please note that today's discussion will include certain forward-looking statements that reflect our current assumptions and expectations, including those related to our future financial performance and industry and market conditions. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from our expectations. We encourage you to review the information in today's press release, as well as our Form 10-K filed with the SEC regarding the specific risks and uncertainties. We do not undertake any duty to update any forward-looking statements except as required by law. During the call, we will use non-GAAP financial measures when talking about the company's performance and financial condition. You can find additional information on these non-GAAP measures in this morning's press release posted on the investor relations portion of the website. With that, I'll turn the call over to John Rademacher, Chief Executive Officer.

Thanks, Mike, and good morning, everyone. Overall, after initial sluggishness due to the widespread impacts of Omicron variant on our team members, customers, and patients, the first quarter proved to be a very productive start to the year for the option care health team. We continue to invest in our future growth strategy while navigating a challenging economic environment to ensure we provide unsurpassed patient care. As Mike will review in a few minutes, our first quarter financial results were very strong, and I'm pleased by our performance across the spectrum of financial and operational metrics we use to manage the enterprise. Specific to the first quarter of this year, note that the prior year comparable period was quite soft as we're just starting to see COVID vaccine distribution in the second half of the first quarter of 2021. We also benefited this year from a few one-time expense benefits that help drive leverage in the P&L that we do not believe are likely to repeat. So while reported growth is very strong in the first quarter, as we anticipated, we believe the comps will balance out in the back half, and we anticipate our growth profile normalizing to a greater extent. Nonetheless, based on our momentum coming out of the first quarter, we are raising our financial guidance for the year accordingly, as Mike will discuss shortly. As we entered the year, we were in the midst of the COVID resurgence related to the Omicron variant. This had a very disruptive impact on our referral patterns and local pharmacy operations. Given the resilience of our teams in the field, we were able to quickly respond after the Omicron cases subsided, and we saw a return to normal operations by the end of the first quarter. While acute referral volumes continue to lag in certain geographies, we did see a gradual reopening in many of our referral sources. Our chronic revenue was especially strong in the quarter and was driven by our portfolio of chronic inflammatory therapies and newer therapies for multiple sclerosis, myasthenia gravis, muscular dystrophy, and others. We also saw a few points of growth from therapies that were in short supply last year but are now available, including therapies for thyroid eye disease. As we discussed on our prior earnings call, we also entered the year with unprecedented inflationary pressures across the broad spectrum of goods and services we utilize. While the collective inflationary pressures was somewhat muted in the first quarter, we do see an increased impact in the balance of the year. We continue to thoroughly assess our labor competitiveness, and we adjust compensation primarily at the end of the first quarter as part of our annual cycle. so the compensation increases are not fully reflected until after Q1. We are also seeing broad cost increases in key procurement categories, including transportation, medical plastics and key supplies, business services, and others. As always, the team is focused on finding new sources of efficiency to mitigate the inflationary pressures to the greatest extent possible, while ensuring the highest level of quality and patient care. The labor situation remains challenging, but we continue to recruit our team members every day, and we are making investments to remain competitive both from a compensation and career development perspective. I believe we will continue to weather the storm reasonably well while maintaining focus on fielding the best clinical team in the industry. Aside from the dynamics in the first quarter, we continue to invest in future growth initiatives. The team is making good progress on integrating the Wasatch Infusion Acquisition, which we believe provides a tremendous platform in the growing Utah market, while also adding a unique patient infusion experience to our portfolio from which we can learn a great deal. We recently also closed on our acquisition of Specialty Pharmacy Nursing Networks, or SPINN. and we are excited about the national alternate site nursing platform we are establishing with our two recent acquisitions of Infinity Infusion Nursing and SPIN. We continue to believe this clinical platform will not only differentiate our nursing capabilities in the marketplace, but will also help enable future growth, especially amongst our chronic therapies. Regarding the SPIN acquisition, This is a unique team that has created a very robust clinical model to serve a broad array of customers, including infusion pharmacies, specialty pharmacies, clinics, and biopharmaceutical manufacturers. The option care health team had a preexisting and very constructive collaboration with SPIN, and it was a natural progression for us to seek a stronger integration of our capabilities. We believe their model is distinct and highly complementary to our capabilities of our Infinity organization, and we are just beginning to write the script on our unique national clinical platform, taking the best of both. Reflecting back over the past 12 months, the team has executed on four strategic and economic acquisitions that have built upon the foundation we've established. Funded solely through free cash flow generation, These transactions have added commercial capabilities to our chronic strategy, helped establish a national infusion nursing platform, and expanded our infusion suite capability, and we're just getting started. With our capital structure and strong cash flow, we continue to focus intensely on attractive acquisitions to further accelerate our growth. With our technology foundation and clinical expertise, I'm confident in our ability to find attractive opportunities that will help further expand our presence in the ambulatory settings and post-acute space. So to wrap up my comments, while it is still early in the year, I'm quite encouraged by the momentum coming out of the first quarter and the team is on track to deliver a very solid year. Despite a number of variables and risks that we continue to manage, we expect to perpetuate our track record of strong growth and accelerating cash flow in 2022. With that, I'll turn the call over to Mike to review the results in a bit more detail. Mike?