Bausch Health Companies Inc.

Good morning, and welcome to the Balsh Health 1Q19 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist for pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your touch-tone phone. To withdraw your question, please press star, then two. Please note, this event is being recorded. And now I'd like to turn it over to your host today, Arthur Shannon, SVP, Head of Investor Relations and Global Communications. Please go ahead, sir.

Thank you, Keith. Appreciate it. Good morning, everyone, and welcome to our first quarter 2019 Financial Results Conference Call. Participating on today's call are Chairman and Chief Executive Officer Joe Papa and Chief Financial Officer Paul Herony. In addition to this live webcast, a copy of today's live presentation and a replay of this conference call will be available on our website under the Investor Relations section. Before we begin, we'd like to remind you that our presentation today contains forward-looking information. We would ask that you take a moment to read the forward-looking statement legend at the beginning of the presentation as it contains important information. This presentation contains non-GAAP financial measures. For more information about these measures, please refer to slide two of the presentation. Non-GAAP reconciliations can be found in the appendix to the presentation posted on our website. The financial guidance in this presentation is effective as of today only. It is our policy to generally not update guidance until the following quarter and to not update or affirm guidance other than through broadly disseminated public disclosure. With that, it's my pleasure to turn the call over to Joe.

Thank you, Art, and thank you, everyone, for joining us today. I'll begin with the first quarter highlights before turning the call over to Paul Harradine, our CFO, to review the financial results in detail and update our 2019 guidance. We'll then review the segment highlights before opening the line for questions. Beginning with slide four, Bouch Health is off to a strong start in 2019 as we pivot to offense. The 21,000 employees of Bouch Health companies are fully engaged and truly motivated to turn around Bouch Health, and the quarterly results are excellent. First, organic growth of 5% in the first quarter was the highest quarter of total company organic growth since the third quarter of 2015. Our top 10 products grew organically by 11% in the aggregate compared to the first quarter of 2018. We generated $413 million of cash from operations, and we continued to manage debt and allocate capital strategically, reducing debt by more than $100 million using cash on hand, but also completing the Synergy acquisition during the first quarter. We also increased R&D investment by approximately 30%, in the first quarter versus last year. Importantly, as you can see from the list on the right, our new product launches and strategic acquisitions are helping to round out our product portfolio in dermatology, ophthalmology, and GI. A few highlights to note. We completed the acquisition of Trulia, which is a great addition to the Salix franchise, and also acquired Dulcanitize, an investigative treatment for ulcerative colitis and opioid-induced constipation. Briholly has experienced rapid uptake by dermatologists in the first four months since launch. And in April, Duobree was approved by the FDA and we're planning to launch it next month. Finally, we also completed a number of strategic transactions that have the potential to expand our portfolio, including the acquisition of an investigational eyedrop for itchy eyes associated with allergies, a license agreement with UCLA to develop and commercialize a novel compound for the treatment of NASH, and an exclusive license agreement with Mitsubishi Tanabe to develop and commercialize a late-stage investigational treatment for inflammatory bowel disease. So as you can see, overall, 2019 is off to a great start. We are launching new products, we are meeting our operational goals, and we are well-positioned to pivot to offense in 2019. On slide five, we present a snapshot of the key Q1 financial highlights for our four segments. In the first quarter, Approximately 77% of our revenue was generated by the Bausch & Lomb international segment and the Salix segment, which grew organically by 7% on a combined basis. B&L International grew organically by 8% compared to the prior year quarter, driven by the demand. Salix grew by 5% organically, driven by Sifaxin, which started the year with a great quarter of 11% growth. Excellent results from our two largest segments. On slide six, we laid out the attributes that make Bausch Health a unique healthcare solution. First, durable revenue flow. Our two largest segments generate approximately 77% of our revenue and are growing organically at 7% in Q1-19. Second, we have a diverse business by product, geography, and revenue type. Only one product accounts for more than 10% of our revenue. We operate in more than 100 countries, so we truly have a global footprint. And we have the opportunity to leverage that global footprint by launching our product in international markets around the world. Next, a majority of the business is insulated from U.S.-branded prescription pricing. As the chart shows, nearly 60% of our revenue is generated from products that are not exposed to U.S.-branded prescription pricing and not subject to LOAs, significant LOAs. Finally, the critical mass of people consume our products. Every day, approximately 150 million people around the world would use a Bausch Health product. With that, I'll turn it over to Paul.