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spk04: Year 2023 earnings call will begin shortly. If you would like to register a question at any time, please press star 1 on your telephone keypad. Thank you. Good morning and welcome to Amniel Pharmaceuticals' fourth quarter and full year 2023 earnings call. And I'll turn the call over to Amniel's Head of Investor Relations, Tony DiMeo.
spk09: Good morning, and thank you for joining Amniel Pharmaceuticals' fourth quarter 2023 earnings call. Today, we issued a press release reporting Q4 and full year 2023 results. The earnings press release and presentation are available at amnial.com. Certain statements made on this call regarding matters that are not historical facts, including but not limited to management's outlook or predictions, are forward-looking statements that are based solely on information that is now available to us. Please see the section entitled Cautionary Statements on Forward-Looking Statements in the earnings presentation and SEC filings for factors that may impact future performance. We also discussed non-GAAP measures. Information on use of these measures and reconciliation to US GAAP are in the earnings presentation. On the call today are Chirag and Chintu Patel, co-founders and co-CEOs. Tasos Konideras, CFO. Our commercial leaders, Andy Boyer for generics, Joe Renda for specialty, Harsha Singh for biosciences. and Jason Daly, Chief Legal Officer. I will now hand the call over to Shiraz.
spk07: Thank you, Tony. Good morning to everyone on the call. MNIL delivered solid financial performance in 2023 as revenues grew 8% and adjusted EBITDA grew 9%. We raised our guidance twice during the year and delivered on it. Driven by strong execution and the robust performance across our diversified business, We expect our momentum will continue in 2024 and beyond. MNIL's core strengths lie in our broad-based business platform and our team, both of which are dedicated to providing access to high-quality, affordable, essential medicines. Since Chintu and I returned to the company in 2019, we have been implementing a thoughtful and deliberate strategy to transform MNIL into a leading global diversified pharmaceutical company. With a global aging population and ongoing supply challenges and shortages, our capabilities have never been more important and more in need. In our affordable medicines business, which is our generic segment, we have been building our leadership position since MNIL's inception. We have decades-long reputation for industry-leading innovation, quality, and customer service levels. Our strategy focuses on expanding our portfolio and driving growth with complex, high-value products across retail, injectables, and biosimilars. Our affordable medicines business has consistently grown each year since 2019, and we have launched more complex retail and injectable innovations in the United States than anyone else since then. In 2023, we set a new record number of 39 new retail and injectable products launched. In retail market, our commercial portfolio of over 230 medicines is complex and diversified with less price erosion and more stability. Overall, the U.S. generics industry appears to have turned the corner after years of higher price erosion as many recognize the importance of the sector responsible for over ninety percent of U.S. medicines. In injectables, we have an expanding portfolio, significant capacity, and the capabilities needed to scale this business. We are helping address chronic shortages across hospitals and clinics and are providing ready-to-use injectables that reduce errors and improve the efficiency of care. The next wave of affordable medicines is biosimilars, which has an estimated 141 billion in branded products facing loss of exclusivity between 2023 and 27. We successfully entered this new market with over three oncology biosimilars. That performance exceeded our revenue expectations in 2023, driven by an exceptional commercial execution in that first year. In Q4, we also expanded our biosimilars portfolio by adding two more oncology molecules to our pipeline. Given the market growth and importance of biosimilars, this is a key area of strategic focus and investment for MNIL. We look to further build out biosimilars pipeline over time. Internationally, we are expanding our reach. In India, we are building a customized portfolio focused on key local needs. In other geographies, we are actively working with partners to register and commercialize MNIL products. In our specialty branded business, we continue to provide differentiated medicines We are focused primarily on neurology and endocrinology with our key branded products. In Q4, we expanded with the addition of Ongentis, an adjunctive therapy for Parkinson's. Next, we are so excited about the potential approval and launch of IPX203 this year, which we believe meaningfully advances the standard of care for all Parkinson's patients. In our healthcare distribution business, which we acquired in 2020, the business has about doubled in size in four years. We're launching new products across three channels, distribution, government, and unit dose. In short, we're starting 2024 with remarkable momentum. We believe our durable, broad-based, top and bottom line growth profile is sustainable and accelerating. As MNILians, we wake up every day thinking about what we can accomplish next. We have more shots on goal than ever before. This includes key medicines and new markets where success represents 100 million or more in potential revenues each. MNIL is on an upward trajectory, and we are so excited for what's ahead.
spk05: I'll now hand it over to my younger brother, Shintu. Thank you. Good morning. Everyone. Thank you. And thank you to the global family who work hard every day to help make healthy possible. As she mentioned, we are executing well on our strategy strategy to be an innovative global pharmaceuticals company capable of driving sustainable growth in the key areas of medicine. I will touch on how our core competencies in operations and R&D continue to drive our company's success. First, MNIL has one of the best service levels in the industry with quality at the center of everything we do. Our success is driven by our operational excellence, robust supply chain, and great commercial team. We are driving operational efficiencies to lower cost and expand our margins. At MNIL, we have long been focused on global supply chain security and resilience as we work proactively to meet market needs given the dynamic and ever-changing nature of our business. Over the last few years, we have invested substantial resources to triple our injectables capacity to scale our business and help address market shortages. As you know, the U.S. pharmaceutical market is plagued by chronic drug shortages, including critical oncology therapies. There are several contributing factors, including market price being generally too low for some products to be produced and contract commitment being too short term in the retail market. As of February, the U.S. FDA listed 121 products in shortages. including 78 injectables. About 20 of our commercial and pipeline injectables products are on the US FDA shortage list. We continue to work closely with the FDA to help alleviate drug shortages in the US. We also remain committed to maintaining our stellar quality track record. Since 2005, the US FDA has conducted over 100 successful inspections with either no or only minor observations. Now, all of our manufacturing locations are FDA approved for commercial products, including our inhalation plant in Ireland. As the standards of quality continue to increase, We continue to invest in quality and infrastructure. Our high-quality global operations are at scale to support sustainable long-term growth. Second, innovation is the lifeblood of any growing pharmaceuticals company, and that's certainly the case for MNIL. In 2023, we launched a record 39 new retail and injectables products. Looking forward, the pipeline is deep, with 160 products pending approval or in development. We have 88 ANDS pending, of which 64% are non-oral solids, primarily injectables, ophthalmics, and inhalation products. Further, we have 72 pipeline products, of which now 94% are non-oral solids. accordingly we expect over 30 new launches in 2024 also approximately 45 percent of pending andas and over 60 percent of our pipeline are expected to be first to market first to file or 505b2 products as we shift towards complex innovations we have also been very disciplined by doing more with less spend and have improved the efficiency of our R&D operations. This also allows us to allocate more investment towards external R&D over time. Our key area of R&D focus remains injectables. In 2023, we launched 14 new injectables which sets up well for revenue acceleration in 2024 and beyond. We are increasingly focusing our R&D on oncology, ready-to-use bags, and long-acting injectables. We look to launch two to three high-value 505 injectables each year going forward, starting with the upcoming launch of PAM Ready RTU in April. In addition, our filing for Respiradone was recently accepted by the FDA. This microsphere product reflects our leading complex R&D and manufacturing capabilities. We have more products like these in the advanced stage of development. Outside injectables, another complex area we are focusing our R&D effort is inhalation. We are advancing a number of inhalation drug delivery devices including metered dose inhalers and recipe-made products, which we believe will drive sustainable long-term growth. The next key catalyst is naloxone nasal spray, which is an essential life-saving drug. Our facility in Branchburg, New Jersey, has been repurposed for making this product. Our goal date is soon, and we are ready to go. This product will be available over the counter and to states and counties around the U.S. to help improve access to these critical overdose rescue therapies. Next, we are very excited about the future of biosimilars and pleased with the commercial success of our first three products. This is a key area of growth for us, and to build on that initial success, we added two more biosimilars to our pipeline in 2023, and we look to add two to three more to our pipeline in 2024. In international, we filed about 60 dossiers in emerging markets in 2023, and we plan to file 150 to 200 more in Europe and the rest of the world in 2024. In specialty, we are continuously evolving our R&D effort to move up the value chain just like in generics. On IPX203, we have completed one additional study with very good results and made our complete response resubmission in early February. We look forward to launching IPX203 in Q3 pending FDA approval. We seek to provide access to IPX203 for the over 10 million global Parkinson's patients and are pleased to recently sign licensing agreements to bring IPX203 to Europe, Canada, and Latin America. Next, our DHE auto-injector for migraine and cluster headache is set for Q1 2025 launch, as site transfer to MNIL manufacturing is underway now. We continue to look to add to our specialty pipeline, particularly in new key areas of neurology and endocrinology. As Chirag mentioned, our hard work continues in 2024 as we build on the success of 2023 to bring MNIL to new heights. As founders and CEOs, we are extremely passionate about our company's mission and the shared value we can create for all our stakeholders. I will now pass it over to Tasos.
spk08: Thank you, Chinti, and good morning, everyone. As a reminder, the four pillars of value creation at MNIL are diversification, financial growth, cost generation, and deleveraging. I'm extremely pleased with our performance across all four pillars in 2023 and excited about 2024 and beyond. Let me first start with diversification, where MNIL has made remarkable progress driven by AdCare, strong cadence of new, more complex products, growth of our specialty brands, and expanding in new areas such as biosimilars. As a tangible result, our oral solid generics now account for 25% of total revenues compared to 53% in 2019. Also, our generics account for 61% of total revenue compared to 80% in 2019. We expect our diversification to grow over time, which bodes well for consistent financial performance. Let me now discuss our second and third pillars of value creation, where financial performance and cash generation was undoubtedly exceptional in 2023. All business units grew their respective businesses to deliver record levels of financial results has substantially exceeded every guidance metric we shared with you over the course of last year. Let me first start with our Q4 results where we recorded strong revenue of $617 million. Generic's net revenue was $363 million, down 9% due to year-end timing of orders. Products launched in 2022, 2023, and biosimilars continued to perform very well and added 34 million in Q4. Q4 specialty net revenue of 104 million grew 2% driven by key brand products, while after net revenues of 149 million grew 38%, reflecting strong growth across all of their three customer channels. Q4 adjusted EBITDA of 142 million compares to 154 million in the prior year quarter, driven by investments in R&D and commercial to drive future growth. Adjusted EBITDA in Q4 was ahead of our average quarterly 2023 level, as well as our expectations, which is why we exceeded our annual adjusted EBITDA guidance. Q4 EPS of 14 cents compares to 23 cents in the prior year quarter, mostly driven by higher interest costs. From an operating cash flow perspective, in the fourth quarter of 2023, we generated 136 million compared to negative 23 million in the prior year quarter. This strong growth was well ahead of our expectations and reflects both the strength of our underlying business as well as timing benefits related to collections of our accounts receivable. Let me now discuss our full year 2023 performance, where total net revenue grew to a record level of $2.4 billion, up $181 million, or 8%. Generics net revenue of $1,471,000,000 grew 3%. Products launched in 2022 2023 and biosimilars added 130 million or 9% of growth. The remaining product portfolio continues to perform well due to the relevancy of our products, strong market demand, and MNL's high quality supply chain. Specialty net revenue for the year was 390 million and grew 4% driven by key branded products. Out-of-care net revenue for the year was $532 million and grew 31%, driven by new product launches and strong commercial execution across all its three customer channels. Full-year adjusted EBITDA was $558 million and grew 9%, well ahead of our original 2023 guidance of $500 to $530 million, as well as the guidance we provided in November, which was between $540 and $550 million. Our growth was driven by strong operating leverage, favorable R&D spend, and growth in our commercial expenses. Full year 2023 adjusted EPS of $0.64 declined 6% as higher interest expense offset adjusted EBITDA growth. Nevertheless, our EPS performance again substantially exceeded all prior guidance we had provided. Operating cash flow in 2023 was $346 million compared to $65 million in 2022. Our 2023 performance was well ahead of our expectations and benefited from strong collections in December. It is worth noting that our 2023 operating cash flow of $346 million also includes 86 million in legal costs, mostly related to the settlement of the OPANA ER case. At the end of 2023, we only had one last remaining payment related to OPANA ER for approximately 52 million, which bodes well for future cash generation. Let me now turn to our 2024 guidance, where we expect another year of strong growth. On the top line, we expect total company net revenue of 2,550,000,000 to 2,650,000,000, reflecting high single-digit growth driven by robust growth in all of our three segments. First, in generics, we expect high single-digit growth compared to 3% in 2023 due to three key dynamics. Number one, biosimilars should more than double to over 125 million in 2024, compared to 66 million in 2023. Our three oncology-focused products continue to drive substantial value to both payers and patients. Number two, new product launches, many of which have already been approved and launched, should add over 100 million. In addition, we're optimistic on the potential FDA approval of Naloxone, which could add over 30 million in 2024. Three, as we always do, we expect the competitive nature of generics to persist and the strength of MNL's R&D, superb quality, and reliable supply chain to be competitive advantages. Second, on the specialty business, we expect low double-digit growth compared to 4% in 2023, driven by our key branded products, and in addition, agentes in our Parkinson's franchise. We look forward to the potential approval of IPX203, but we have not included any revenues at this point as to ensure proper conservatism. Finally, on out-care, we expect double-digit top-line growth, albeit some slowdown from the 31% growth in 2023, driven by continued broad-based strength across all channels and a number of new launches. Moving down the P&L, we expect 2024 adjusted EBITDA of $580 million to $620 million. reflecting continued high single-digit growth and higher investments in R&D to drive the numerous projects in our pipeline. From an adjusted EPS perspective, we expect a range between 53 cents and 63 cents driven by higher interest costs partially offset by higher adjusted EBITDA. On the cash side, we expect operating cash flow excluding legal settlements between $260 million and $300 million. This strong cash generation reflects higher EBITDA, typical accounts receivable collection patterns, and higher interest expense. From a capital expenditure perspective, we expect $60 to $70 million a year. Finally, we continue to make solid progress on our fourth pillar of value creation, the leveraging. Net leverage has come down remarkably from 7.4 times in 2019 to 4.8 times at the end of 2023. For 2024, we expect to pay down between $100 and $200 million of gross debt and reduce net leverage closer to four times by the end of 2024, below four times in 2025, and then below three times soon thereafter. With that, let me turn the call over to Shirat.
spk07: Thank you, Tasos. In summary, 2023 was a very good year across the board for MNIL. Looking forward, we believe 2024 will be even better as our future is so bright. Let's now open the call for Q&A.
spk04: Thank you. If you would like to ask a question, please press star followed by one on your telephone keypad. If you would like to withdraw your question, please press star followed by two. When preparing to ask a question, please ensure your device is unmuted locally. First question comes from Nathan Rich with Goldman Sachs. Your line is open. Please go ahead.
spk02: Great. Good morning, and congrats on a strong year and for all the details that you shared on the call this morning. I wanted to start with the guidance for the specialty segment in 2024. It seems like you're expecting a nice acceleration in growth. I think TASOS, if I heard you correctly, it doesn't include IPX203. So could you maybe just talk about what's driving the growth there? You know, how much is maybe coming from on GENTIS and adding that into the portfolio? And then bigger picture, you know, could you maybe just talk about the initial feedback of adding on GENTIS in? And, you know, can you talk about what the commercial strategy will be, you know, assuming IPX203 gets approved later in the year and how that'll help your market position relative to what the experience has been with RITARI?
spk08: Hi, Nate. I'll take the first part as to kind of what's driving the accelerated growth. And I think it just really comes across Unithroid just continues to be doing incredibly well, growing at double-digit rates, number one. Rightary, we aligned our commercial, our field forces last year. We have a new leader in that market and just continues to drive high single-digit prescription growth. And then finally, as you correctly pointed out, so next this year in 2024, we have a full year of revenues. That should contribute, you know, between, you know, $25 to $30 million of incremental revenue. So it's really kind of driven across all of those three key branded products. And as you mentioned correctly, we have not built any potential IPX revenues in our guidance. Hopefully, we'll get approval later on this year, and we should be in a position to add those in the latter part of the year.
spk07: Yeah. And, Nate, just taking it further, how Ongentis has worked out really well for us. It's a comp inhibitor. It's complimentary with CDLD. It improves the off time for the certain patients. So, excellent start of transitioning the product from Neurocrine to us and great partnership with BR, the Portuguese innovative company. And the Salesforce already, we launched it at MNIL last week. And very excited to complement on GenDisk with currently Writary and going forward with IPX203. IPX203, we're also ready to launch. And as you know, that's completely differentiated product than the Writary and obviously much better than the IR with the 1.55% hours of good on time per dose, which is significant, and 95% of Parkinson's patients still take IR product. Only 5% are on Raitary. So we're going on a broad-based strategy to general neurologists. We have target lists. We've been in contact with PEARS for a while now. We're ready to have a successful launch with all the learnings of last seven years with Rytary. Our teams are very excited, and we expect the conversion of these IR to IPX203 and complementing with Angentis to be a much higher percentage than Rytary. And globally also, as my brother mentioned, we have licensed out the products in Europe in South America, in Canada, soon to be in China, Japan, India. India will be marketing by ourselves. So Parkinson's patients globally should be using latest and greatest formulation and technology and have a better life every day than use 35, 40 years old technology of IR and go through the ups and downs of daily life. And it helps their caretakers as well. So very excited on specialty growth and then it continues in 2025 with DHE auto injector launch and more to come after that.
spk02: Great and then maybe just a kind of higher level question, you know looking at the the guidance for you know, this year, you know, top line came in stronger. I think margins are going to be pretty consistent year over year, maybe down slightly. I guess I'd just be curious to, You know, as we think about, you know, the view kind of three to five years out, you know, how do you see the margin profile of the business evolving as you bring a lot of these new products to market? And, you know, once we start to see that, especially on the specialty side, I'd just be curious to get your view on, you know, where you think margins for the business can go longer term. Thank you.
spk08: Yeah, I can take that. As you said, margins have been pretty consistent, number one, the last few years. So, and what we've been able to do is really focus on incremental revenues, on incremental EBITDA, right? And transition the business to a more complex, more durable, cost generating business. So, our focus has been primarily on driving incremental incremental top line, bottom line and cost over the course of time. Our profitability profile should increase. It'll increase for a couple reasons. Number one is as our generic portfolio continues to evolve into the world of more complex businesses, right? Those businesses have higher levels of profitability, number one. The same thing over the last couple of years, in 2024, on the specialty side, we continue to build out those infrastructures. Those costs will be behind us. So, over the course of time, you know, when you look at the EBITDA profile and the gross margin profile, this will continue to grow over time.
spk05: And just to add, Nathan, our injectable plants are underutilized as we are launching new products, so in coming years. both our new injectable facilities will be totally utilized, plus our inhalation plant in Europe, where we don't have a commercial product, we expect to have a launch by end of the year or early next year. I think that will also improve the margin. So I think as Tasos mentioned, you know, many, many complex product and the plant utilization in certain complex area will improve the margins in coming years. Yeah, and more specialty revenues as well. Yeah.
spk02: Great. That's helpful. Thanks very much.
spk04: We now turn to David Amsterdam with Piper Sandler. Your line is open. Please go ahead.
spk01: Hey, thanks. Good morning. So a couple of questions. First, on 203, can you just talk about the payer landscape and how that is going to evolve, bearing in mind that We'll see generics for RITARI. So just talk about what you think are going to be the challenges here regarding access. That's number one. Then secondly, on injectables, can you just talk about how much contribution from shortage products you're going to be getting not just this year, but longer term, and how big of a priority is it to focus on the range of different shortage products that we're seeing, and what is the priority vis-a-vis more complex injectable products that you're developing? So if you could talk to that, that would be helpful. Thank you.
spk07: Thank you, David. I'll take the first one and hand it off to Harsha, who is head of our institutional business and biosimilar business, to answer the injectable product question. So, IPX203 coverage, the initial discussions, which is going back to last year, has been very positive. Our entire strategy on pricing with keeping the excess in mind, because we want to reach more neurologists, more patients, It has been extremely positive. I do not know if you know, but RITERI has the best fair coverage among the class. It's 80% is covered, which we expect the similar coverage for IPX203. So we're very positive on the coverage, which we're under initial discussions, and it should be coming online upon approval as well as a few months after that.
spk05: Just to add on IPX, that RITERI only covers 5% of the patient, and IPX is a very unique formulation which will have a broader reach. So I think when the genetics of RITERI comes, we don't believe that we'll have much of a bearing on IPX adoption because it's very unique, much more stable formulation in a way that it provides long-term blood concentration, good on time, 1.55 hours. So I think it's distinctly different product than Rytary. So we are very excited on the offering for the Parkinson's patient.
spk07: And we'll continue to conduct further studies. So as soon as approval comes, we're conducting more studies on IPX203. I'll pass it on to injectables, and then, David, if you have any follow-up, we'll.
spk06: David, with regard to injectables, this is for Cheryl. Look, it's hard to give you an actual number that breaks up steady products versus shortage products. What I will say is the strategy here is to support the market in areas where the market fails in order to build franchises that are sustainable. And you can see in our history, there is a product readily available called methylprednisolone acetate, where we effectively did that, where we went from about a 2% share to a 50% share and then retained that share even after other competitors returned to market by creating a franchise. And I think that's what we look to do with our diversified manufacturing base that allows us to rapidly scale up and support markets where there are structural failures. We expect to see more of those failures in the coming months. And I think the market is ripe for solutions like those that we provide.
spk07: And our capacity has been tripled from 20 million to 60 million units per year. So that allows us to address more shortages. And what we are building out is especially addressing oncology shortages and how can we be helpful for the clinics and the hospitals to bring more of those products and consistently provide them.
spk05: David, on a priority, in development, our priority is always the complex injectable product. So we are continuing to focus on complex because those are much more high barriers to entry. But we do have shortage products, and with expanded capacity, we can cater to the market and provide those products.
spk01: Okay, that's very helpful, caller. Just a quick follow-up, and I'm sorry if I missed this. Are you right-sized on injectable capacity, or are you planning more capacity expansion?
spk07: Right now, we have what we need.
spk04: Okay. Helpful. Thank you. We now turn to Balaji Prasad with Barclays. Your line is open. Please go ahead.
spk00: Muneeb Ali Khan, Good morning everyone and congratulations on the performance and also the strong guidance that you're provided so starting on the guidance. Muneeb Ali Khan, On the key launches that you're expecting for 2024 at least some of the ones immediately look like they're set to contribute $130 million. Muneeb Ali Khan, I want to see if there are any gating factors like inspections that are to be concluded for any of these launches. and are not, so kind of trying to adjust the risk levels for these launches. And maybe, secondly on this, the launch timeframe for both DENISMAP, Naloxone, I heard that you launched recently, can also comment on the pushes and pulls towards the market share and the total number of units that are potentially there in this market. Thank you, that's fun. Two on guidance, again, 2024 strong EBITDA guidance, Extension of the previous question, how would these new launches impact the guidance in either direction, or is this current guidance based mostly on products that you launched in 23 and would gain traction in 24? Thanks.
spk05: Yeah, this too. So I'll answer the first one. You know, MNIL has a standard quality track record over 100 inspections over the last 20 years, and all of our plans are FDA approved, including our inhalation. So, for all the launches that we are expecting in 2024, we don't anticipate any PAI as of now, because we had recent inspections of all the plants, like our naloxone facility, our injectable plants. So, I don't think there is any gating factor that's going to prevent the approval of those products in 2024. On Donazumab, our launch is 25, 26.
spk07: Yeah, so guidance, the key launches, we launched 39 products. So about 20 plus was launched in the fourth quarter, 24. So those get annualized. So revenues already are approved. We feel good. Naloxone is the new FML was we just launched in January. Naloxone is coming soon with a potential of quite a bit this year and a lot more in 24, I mean 25, 26. Plus we expect a couple of big GX launches as well, which we haven't disclosed, which is coming up in May, June timeframe, July timeframe. Very excited on the complex product launches, obviously the Naloxone, annualizing the last year launches, which includes injectable launches. So several injectable launches would be annualized as well. So that is how the launches shape up. And we feel very comfortable with push and pulls. And since having multiple launches, that should not be any problem.
spk00: That was on the guidance.
spk08: Oh, I figured that was, um, you guys did a pretty good job addressing it. There is nothing inherently risk here in our guidance this year than last year. Uh, so, um. In prior years, Arriba tended to be more back-end loaded, which, you know, typically investors don't love. Our guidance this year is more evenly split throughout the year, so we're not planning any huge ramp-ups towards the back end of the year. And, you know, there are just different levels, different products. And it's not just the revenue we're accounting at. It's also the operating expenses. So, you know, we continue to drive a number of operating expense efficiencies here. So if something were to happen on any product, which always happens, by the way, right, something were to happen on the revenue side, we're just looking to pull other levers in the operating expense side to protect the bottom line. So hopefully this kind of gives you enough insight.
spk07: Yeah, Balaji, we feel much better this year than we felt same time last year.
spk00: Great. Thank you. Maybe a quick follow-up. Chirag, in your comments, you spoke about the U.S. generic industry having turned the corner after years of price erosion. It's a call we've been making and good to see that being validated across the board. I want to understand if there's going to be additional competitive maneuvers from the buy side, or is there an equilibrium that has been reached now between the manufacturers and the buy side? Thanks.
spk07: Balaji, it's still a work in progress. We are seeing good signs, and most importantly, it is causing shortages. it could cause further shortages. So FDA is really worried. As you can see, the Congress constantly putting out hearings and White House meetings, which our team attends as well. This is a real problem. It has to get better. Six years of massive price erosion, nobody can invest in quality. Nobody can invest in a proper infrastructure, new machineries. So all these constant dialogues and us being a leading company, obviously we're forefront of those dialogues with our esteemed partners. And it is, it's been a good change. We're in a more on a long-term stability programs with one of our largest buyers, another big retailers moving in the same direction. So we're very hopeful for what we are seeing because It is just not right to have prices from manufacturers which are pennies or below pennies. Nobody can even supply, nobody can even invest, and it will cause quality issues and shortages. And I'm afraid that if consumers start knowing that the pill they're taking has been made or sold for one penny, it may have a very negative placebo impact.
spk00: Thank you, Chirag.
spk04: We now turn to Chris Scott with JPMorgan. Your line is open. Please go ahead.
spk10: Great. Thanks so much. Just a couple here. I guess first on the generic Avastin dynamics, just elaborate a little bit more in terms of what you think's allowed M. Neal to take share and succeed in this market the way you have, and just any learnings, I guess, from these first three launches that's informing I guess the type of assets that you're considering and how aggressively you're kind of looking at the biosimilar market as a whole. And then my second question was just to follow up on IPX203. I know you're not including sales in the guidance this year for conservatism, but it does sound like you expect coverage to come on board fairly quickly post-approval. So my question is, do you expect pair dynamics will be a limiting factor at all early in the launch? or is this a product that we should expect could roll up and ramp pretty quickly post-approval? Thanks so much. Great.
spk07: So, Chris, how are you? Let me turn over to Harsher first for Avastin and how we are building the Onco franchise, and then I'll take on the overall biosimilar markets as well as IPX.
spk06: Chris, thank you for your question as we look at a bastion and oncology slash my similar franchise as a whole. What we recognize is that the marketplace is challenged by what? By pricing dynamics that are not consistent with their expectations. And what we were able to deliver was a solution that effectively met the needs of the market in a marketplace that had become challenging for some of those, particularly providers, but also payers. And by learning a little bit from the dynamics that we'd seen in the past and putting forward a solution that we felt addressed those, we were able to create what is a fairly stable pricing dynamic and fairly stable uplift that looks like it improves queue over queue. We think that that is a repeatable business model, and we think that is a business model where our relationships and our longevity and our ability to do it time and again is going to differentiate us, which is why we continue to look at oncology, and you'll see us launching products like PEM Ready, which we expect to launch next quarter.
spk07: Thank you, Harsher. And overall biosimilar market is going to be large over next several years and it becomes more healthier and healthier as new launches come in. It is going to be competitive, so you have to be mindful on the investment and you have to select which product you want to enter in. Our strategy has been more buy and build or combination of buy and build and PBM driven and we'll continue to invest in those assets. Currently, we are only front end commercial for United States. As over time, we can integrate potentially or partner more strategically. So all those avenues are open for us, but we are committed to buy a similar business. We believe it will be a size of global size of about 80 to 100 billion by 2031, 32 for the manufacturers. So that is a fantastic market for a company like us who is completely focused on affordable medicines as we lead the retail segments. It's pretty soon to be leading injectable segments and now here comes the biosimilar segments and we intend to lead and especially in the United States. IPH203, that's good news. We expect the coverage to be right away as well as the uptake to be right away because of our experience with RITERI, the relationship with KOLs, relationship with foundations, the patients, the patient's caretakers have started building relationship with 700 neurologists, which we never reached out before. and the purpose of IPX203, having a great market access team, MSL teams, the cells team which have relationship over the last seven to eight years. We're very excited. It's a strong uptake and shouldn't take, it's not a new molecule that should take a longer time for going to the peak cells. So excited about IPX203. Thank you.
spk10: Thank you.
spk04: Our final question comes from Les Zulaveski with Truist Securities. Your line is open. Please go ahead.
spk03: Good morning. Thank you for taking my questions. I have two. Just a quick follow-up on the GENTIS. So taking the early performance trends of GENTIS into consideration, do you envision treating this product as an essential product relaunch? And how do you think the peak sales potential is for the product now that it's on your platform? And then second, you highlighted the focus on neurology and endocrinology to grow your branded portfolio. What opportunities do you see out there within these two therapeutic areas and potentially outside to add to your specialty segment? And also, I guess, high level, how are you thinking about other chunkier BD plans? Thank you.
spk07: Yeah. Hi, Les. So, on GENTIS, NeuroClean had done a good job. We're taking that continuous platform, and it has been a smooth transition. So, we thank NeuroClean team as well. And we are now expanding the reach and the message on a complementary outcome between the on GENTIS, which is a comp inhibitor, which extends the life of levodopa, therefore reducing the off-time. So it's a classic complementary product between the soon-to-be IPX203, currently RITERI, and then with COMP inhibitor, which is on GENTIS. So we expect the peak cells to keep going up. We haven't been public, but it should cross the 50 million and keep going. And then on the pipeline for in the neurology, we're looking at different assets, whether they're in phase two, phase three, and we'll be probably announcing certain deals this year. We're hopeful. And that would be more expanded pipeline that we are now going after the products that can generate similar to three to five hundred million dollars in revenue. So we're not looking at a smaller assets anymore. And on end of chronology, we have over K, one, one, four, which we're very excited if we can get through the regulatory hurdles. It's the much-needed products in the market with the combination with the T3 and T4. We believe that product also can be a pretty large contributor. And also looking at a couple of pipeline assets in Phase II and III and Endo as well.
spk03: Thank you.
spk04: This concludes our Q&A. I want to hand back to Shirag Patel for final remarks.
spk07: Well, first, thank you to the global MNIL family for very strong performance in 2023. And our mission is clear, and it hasn't changed since our founding, provide access to high-quality, affordable, and essential medicines. With building momentum across our diversified pharma business, we believe 2024 will be even better as we continue to grow, expand our reach, and impact more patients than even before. Thank you very much.
spk04: Ladies and gentlemen, today's call is now concluded. We'd like to thank you for your participation. You may now disconnect your lines.
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