Pacira BioSciences, Inc.

Good day, and thank you for standing by. Welcome to the Q2 2024 PSERA Biosciences 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 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Susan Mesko, Head of Investor Relations. Please go ahead.

Thank you, and good afternoon, everyone. Welcome to today's conference call to discuss our second quarter 2024 financial results. Joining me are Frank Lee, Chief Executive Officer, Tony Malloy, Chief Legal Counsel, and Charlie Reinhart, Chief Financial Officer. Jonathan Slonin, Chief Medical Officer, is also here for today's question and answer session. Before we begin, let me remind you that this call will include forward-looking statements based on current expectations. Such statements represent our judgment as of today and may involve risks and uncertainties. For information concerning risk factors that could affect the company, please refer to our filings with the FCC which are available from the SEC or the PSIRO website. With that, I will now turn the call over to Frank Lee.

Thank you, Susan, and good afternoon, everyone. As you know, our top priority for 2024 is to ensure we're ready to accelerate growth next year and beyond. Toward that end, the first half of the year was marked by strong execution and meaningful progress towards our commercial, clinical, and business objectives. We maintained solid sales across all three of our products, strengthened our balance sheet, and bolstered our leadership team. We reshaped our corporate culture and enhanced our organization with new talent and capabilities. The foundation for a modernized commercial, medical, market access organization is now in place. Looking ahead to the remainder of the year, continue to invest in the organization and set the stage for strong, sustainable, top-line growth in 2025 and beyond. We believe that growth will largely be driven by Exporil, which is the product I'll focus on today. Let's start by walking through the three key 2024 priorities. First, expanding the utilization of Exporil as a lower extremity nerve block. Second, preparing the market for separate Medicare reimbursement at average selling price or ASP plus 6% with implementation of the No Pain Act in 2025. And third, broadening patient access to Expiril through new GPO partnerships. I'll start with lower extremity nerve block where we continue to see positive market receptivity across all sites of care. To remind you, the rollout of Expiril lower extremity nerve block is supported by compelling clinical data from two phase three studies that demonstrated four days of superiority versus bupivacaine. These data are also a valuable tool we're leveraging to promote the opioid sparing benefits of Expirel to our customers in advance of no pain. We were pleased to see this new reimbursement policy outlined by CMS in its recently published preliminary rule for 2025. We believe this important reimbursement milestone will drive expanding Expirel utilization within the outpatient settings where there's ample room for growth given the market's steady migration away from inpatient care. In preparation for No Pain, we're advancing multiple initiatives to drive Expirel education and awareness across key stakeholders. To highlight the value proposition, we're generating real-world evidence demonstrating the opioid sparing and economic benefits of Expirel. We believe these data will be a powerful tool in our communications with healthcare systems, physicians, and payers. Recent progress includes a publication of three robust retrospective real-world studies in colorectal, spine, and breast reconstruction surgeries. Each study compared patients who received Expirel with patients who did not. Expirel was associated with reduced opioid use, as well as lower emergency department visits, length of stay, and hospital readmission rates. To drive education awareness among our primary stakeholders, we recently launched our national campaign, Make the No Pain Pact. The campaign is targeting hospital pharmacists, administrators, clinicians, and revenue management teams. It is solely focused on ensuring these critical groups are up to speed and ready when new outpatient Medicare reimbursement takes effect in January of 2025. Based on our market research, preliminary insights indicate a growing level of awareness and understanding among key stakeholders around no pain and its potential impact on patient care. As the year progresses, we'll continue to roll out new resources to help our customers seamlessly integrate this expanded reimbursement change into their systems. Shifting gears to market access, as you know, we're also paving the way for no pain through our participation in 340B pricing and new GPO partnerships. Through these preferential pricing programs, healthcare systems can afford the opportunity to be at the forefront of opioid sparing pain management. Our customers will have a favorable acquisition cost and when no pain takes effect in 2025, they'll be reimbursed at ASP plus 6%. We're now six months post-launch of our Premier partnership, which continues to perform as expected with extra real volumes at Premier accounts up over the prior year with only a very modest impact on net sales dollars. We're also leveraging our Premier partnership for additional opportunities. For example, last week I had the opportunity to participate in a hot topic interview with a member of the Premier leadership team to discuss PICERA at their annual membership meeting. The discussion focus are a commitment to partnering with health systems and No Pain. We also utilize opportunities to drive awareness around No Pain within the Premier membership base. Importantly, we have two additional GPO partnerships expected to go live this year, with both offering similar opportunities to expand patient access to expirals. Turning to Zolretta and Iovera, I'm pleased to report that both products are performing according to plan with solid sales in the first half of the year. Patient dosing is also underway in our Phase III Registrational Study for Zolretta in shoulder OA. If successful, this study could make Zolretta the first and only long-acting steroid approved for use in shoulders. Shoulder OA represents a sizable market opportunity with approximately 1 million intraarticular injections administered each year. Our registration study for Iovera for the treatment of spasticity is also underway. Given the significant lack of innovation in the spasticity space, we believe Iovera may offer a novel approach for patients afflicted by this debilitating condition. On the research and development front, I'd like to provide a brief update on PCRx201. This novel gene therapy product candidate codes for interleukin-1 receptor antagonist or IL-1RA for the treatment of osteoarthritis or OA of the knee. There is significant unmet need in the OA space. This is primarily due to lack of drugs with durable and clinically meaningful improvements in pain and function and the lack of disease modification therapies. Current single-dose injectable therapies relieve pain and function for only three to six months and do not offer disease modification to the 14 million patients suffering from EOA. Earlier this year, we reported encouraging interim results from a 72-patient Phase I study of PCRx201 for moderate to severe EOA. In this large Phase I study, a single inter-articular injection of PCRx201 demonstrated a sustained and clinically meaningful effect. This was observed at all doses across all levels of severity for at least one year post-injection. Importantly, PCRx201 was well tolerated with a favorable safety profile. We continue to follow these patients and now have data for two years that were submitted for presentation at a medical meeting in the fall. Based on our market research and feedback from our scientific advisory board, improving pain and function while potentially modifying the disease for a year or more with a single dose would be considered transformative by both physicians and patients. Furthermore, more than a year of durability would be clinically and economically meaningful for patients and healthcare systems. Unlike traditional gene therapies that focus on rare diseases, PCRx201 leverages the properties of a novel high-capacity adenovirus or HCaD platform to address unmet needs in prevalent diseases like NeoA. Importantly, our strategy will unlock the potential of gene therapy to provide meaningful and durable and economically viable treatment through local delivery of the affected joint, very low dosing enabled by high-capacity adenovirus, and large-scale manufacturing to support favorable cost of goods. As you may recall, PCRx201 received the FDA's first-ever Regenerative Medicine Advanced Therapy, or RMAT, designation for a gene therapy product in osteoarthritis. We're scheduled to have our first RMAT meeting with the FDA next month, to discuss our plans for clinical development. We look forward to sharing more details on the advancement of PCRx201 on future calls. With that, I'll turn the call over to Tony for a brief discussion of the expirial patent litigation.