Q4 2019 Earnings Call

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Please standby your programs about began.

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Good day and welcome to today's program My name is free and I'll be your conference operator at this time I'd like to welcome everyone to Eagle Pharmaceuticals fourth quarter and full year 2019 earnings results Conference call. All lines have been placed on mute to prevent any background noise.

After the speaker's remarks, there will be a question and answer period.

That time, if you have a question please press star and one on your touched on phone.

As a reminder, this conference call is being recorded today March 2nd Twentytwenty.

It is now my pleasure to turn the floor over to Ms., Lisa Wilson Investor Relations for Eagle Pharmaceuticals. Please go ahead. Thank you very welcome to Eagle Pharmaceuticals fourth quarter.

15 earnings.

This is Lisa Wilson Investor Relations for Eagle Pharmaceuticals, with me on today's call or you go from.

Active officer, Scott tariff and Chief Financial Officer P. Myers.

Good morning to compete the issued a press release detailing financial results for the three in 12 months ended December 31st 2019.

This press release and a webcast of this call can be accessed through the investor section of the go website <unk>.

<unk> Dot com.

Before we get started I would like to remind everyone that any statements made on today's conference call that express a belief expectation projection forecast anticipation or intent regarding fruit your statements and the company's future performance, maybe considered forward looking statements as defined by the private securities.

The gallery format.

These forward looking statements are based on information available to Eagle Pharmaceuticals management as of today, and a rough risks and uncertainties, including those noted in this mornings press release at our filings with the FCC.

Such forward looking statements are not guarantees of future performance actual results may differ materially from those projected in the forward looking statements.

You go far skewed suitable specifically disclaims.

And and sand or obligation to update these forward looking statements, except as required by law.

Telephone replay will be available shortly after completion of this call you'll find the dial in information in today's press release.

Archived webcast will be available for one year on our website at Eagle U.S. Dot com.

For the benefit of those listening to the replay or archive webcast. This call was held and recorded on March 2nd to 2020.

Since then you go may have made announcements related to the topics discussed so please reference the company's most recent press releases.

Finally I.

With that I'll turn the call over a few guilty of Scott Terry.

Well, thank you lease and good morning, everyone.

Let me begin by saying that we're very pleased with all the recent developments to support the evolution of Eagle into an integrated pharmaceutical company. We're focused on capitalizing on the momentum from late 2019 that has continued into 2020 or efforts are paying off as evidenced by several recent announcements.

Including the final it the finally FDA approval on settlement with Lilly purpose sexy or Anda filing for Exertional Heatstroke reagents, our partnership with Northshore health system for traumatic brain injury, a collaboration with University of Pennsylvania in Alzheimer's disease, and a host of other important company milestones.

Building on five years of research. This year, we will have several data read outs to help is advanced these important initiatives with 10 projects underway and the potential for five commercial launches in the next three years, we're both proud and excited about the opportunities ahead.

We have continued to invest cash in our very active pipeline on the non-GAAP basis in Q4, we invested $14 million or 63 cents per share to advance our pipeline.

Total R&D plus legal expenses related to days, a precedent and sexy for the full year to $43 million or $2.30.

Per share.

I believe the following is important to point out.

Based on current strain for the current strength of our marketed products.

And assuming an on time approval for Ryanodex for Exertional heat stroke, and an affirmation of our orphan drug decision by the appellate court for Bendeka.

2020 could be the best year and Eagles history in terms of total revenue and gross profit.

We are in what could be the start of a very value created for Eagle again, if the HST No D. E are successful we can generate record revenue and gross profit and that doesn't include the potential to watch vasopressin later this year or the symbio milestone payment that we expect to receive in the second half.

As an example, we estimate that Ryanodex m. eight sales in Q1, 2020 will not be too far off from all of 2019.

In the meantime, we aspire to advance our pipeline so used to launch aegis shortly.

I would buy days oppressive then filed nerve agent before the ended the year, which will lead us into the likely exclusive launch of and Vecsey in the beginning of 22 anticipated to be four months before lived in India entries.

Let's see how things unfold in the next few months well, we hope to be going through significant acceleration in value starting this year and over the next several years in terms of revenue improved profit and at the same time, making great progress with our pipeline.

Now, let's turn to more detail on the projects in our pipeline on the C.N.S. critical care side of the business, let's start there with the truly innovative work going on around Ryanodex beyond malignant hypothermia, we have done a great deal of additional investigation on dantrolene sodium over the past five years. This has led to the discovery.

What we believe our transformative uses across multiple disease states that have been urgent need of treatment options for many years. Our proprietary research continues to yield insights into how dantrolene plays a role in restoring intra calcium intercellular calcium home yes.

Basis in fact, we believe that changes in interest cellular calcium levels may be involved in neurological pathologies.

And may lead to neuro degeneration, and Nuranda Eagle scientific teams in house and with our great academic partners.

At the insight based on their years have worked identify those diseases and disorders that might benefit from treatments that work to resolve disruptions in calcium regulation.

Let me touch on each indication in turn.

We had been working with F.D.A. now on Ryanodex for Exertional heatstroke for quite some time and based on mutual agreement, we resubmitted our India on July nine on January night.

We have a july 8th could do the date and our expectation at this point is that we will receive approval on or before that date with the potential that he on the market for this upcoming heat season.

We believe this product will be a significant opportunity for the company.

As you May know there is no currently approved drug product for the treatment of this acute and unpredictable life threatening condition.

The ability to use ryanodex to restore cognitive function and someone suffering from exertional heatstroke would represent a tremendous advancement in this treatment, which up until now has only been treated by cooling.

We are evaluating ryanodex for the treatment of brain damage secondary to nerve agent exposure for what would be a first in class treatment. If approved in animal models, we have seen that ryanodex significantly reduces the death of naira.

We're working on the design of our second study under Ft, A's animal rule, which we will commence this year with the potential to file and be a for this indication before year end. This is a U.S. military supportive initiative.

Where we are collaborating collaborating with the U.S. Army Medical Research Institute of Chemical Defense.

If approved Ryanodex would represent the first product available for this indication with the potential to benefit military personnel and civilians.

For acute radiation syndrome, we ran a pilot study last year and we'll run another animal models. This year after which we will meet with F.D.A. This indication is roughly a year behind nerve agent exposure ultimately, we expect that ryanodex available for protecting the military answered billions for radiation.

With respect to our traumatic brain injury indication and the New research agreement. We recently entered into with North sure University Health system, there, especially pleased to be working with the world renowned neurologists Dr. Julian bells, who is the chairman of North share shores Department of Neurology and co director of the North.

Sure Neurology Institute.

Dr. Bells is a respected thought leader in the field and is dedicated his career to the diagnosis and treatment of TB eye and concussion.

Specifically, we will be starting another more robust animal study to further explore our hypothesis that ryanodex may have the potential to modulate some of the mechanisms that result in neurons sell damage and death.

A read out of that data is expected later this year as well after completion of this study.

We plan to meet with F.D.A. and discuss the path forward, including design of our human studies.

The other big partnership news relates to the indication were seeking for Alzheimer's disease.

In January we announced agreement on terms for an exclusive worldwide license with University of Pennsylvania for the development of dantrolene sodium for Alzheimer's disease.

The data we shared at the 2019, all timers Associate whose association International conference with U. Penn in July was a proof of concept preclinical study and documented that Intranasally administration of dantrolene sodium at a positive effect on memory and cognition in an animal study.

The result showed improvement in behavioral tests, such as cognition and memory in a mouse model of Alzheimer's disease exploring the unique role of calcium this regulation in Alzheimer's disease represents a completely novel approach to the treatment.

Readouts from this preclinical study will be available in about 12 months.

In addition to our work studying dantrolene sodium we also see significant benefits in developing the next generation of ryanodine receptor antagonists capable of intramuscular delivery.

Our EA 111 project aims to do just that this is a very exciting time for the ran index franchise with enormous upside potential to address unmet medical.

Now, let me touch briefly on base Suppressant as a reminder, eagle is the first to file and aim D.A. referencing basis strict 20 units for one of them out.

Phase of Preston is also very important product to us. We believe we are talented when it comes to paragraph four litigations as evidenced by our settlement for FX C., we feel confident going into trial, which is coming up soon on May 18 already it's possible that if we had a court victory and we received our 10th.

The dip approval as we expand.

Go to the market as early as October of this year, we'll know a lot during the week of May 18th and we're looking forward for that trial.

Now, let's turn to you in college he side of our business starting with full this trend our product candidate for estrogen receptor positive advanced breast cancer.

We have the initial results of our focused ramp pilot study and the program has not yet yielded the final results desired or modifying the programs remain encouraged on this important program. We will keep you updated on our progress and potential path for it we continue to learn quite a bit about our product as we look forward to the best.

The way to achieve our objective.

Turning now to protect see are ready to dilute version of Imitrex. It doesn't require reconstitution upon settlement with Lilly in December of 2019, We recently received final approval from F.D.A. for Pemex C.

If you weren't the good news is that Eagle will have an initial market entry with Penn Flexi on February Onest of 2022, and the subsequent uncapped entry on April one of 2022.

Also on the oncology side of the business, we announced in January and exciting collaboration co promotion agreement with time technologies.

Company focused on developing therapeutics for difficult to treat cancers, we paid an initial $20 million up front and have the option to invest in additional 20 million upon achievement of certain milestones.

10 million of which would be an additional purchase of equity.

In time time will be responsible for all development regulatory manufacturing and marketing costs associated associated with SM 88, as well, 75% of the promotional effort with Eagle responsible for the remaining 25%.

We will also receive 15% of all net sales in United States time May also buy out our rights under the co promotion agreement at any time for $200 million.

Before I turn the call over to Pete to discuss the financials, let me touch briefly on another important ecology asset and the musty.

Trend the generics are not expected before December 22 [noise].

As I mentioned earlier the outcome of litigation for seven years of OTI for Bendeka is pending we expect the decision in the next few months.

In addition, our marketing partner in Japan, Symbio anticipates approval for its ready to dilute than the Mustang product.

In September, which entitles us to $5 million milestone [noise].

As we've stated before starting next year, the royalties and milestones could be meaningful to the magnitude of $10 million to $25 million per year for sym bio first launching the 500 ml bag and then the 50 ml that.

As I said upfront. This has been a very active period for Eagle reflected by the recent news flow representing years of research and hard work.

With 10 projects underway and the potential for five product launches in the next three years each with a distinct market advantage. We think there's never been a better time to be involved with eagle and with that I'll turn the call inward to Pete to discuss our fourth quarter financial.

Pete.

Thank you Scott.

Fourth quarter 2019, total revenue was $48.3 million compared to $56.1 million Q4 2018.

Full year 2019 revenue was $195.9 million compared to $213.3 million in 2018 and included $9 million in a milestone payment for Bendeka.

Product sales during the fourth quarter decreased by $4.9 million year over year totaling $15.4 million compared to $20.3 million in Q4 2018.

Primarily driven by a $4.1 million decrease in Bendeka product sales, one and a half million dollar decrease in Iran is sales, partially offset by an 800000 dollar increase and bill Rep. So sales.

For the year total product sales increased $3.6 million Amir ended December 31, 2019, primarily driven by increases in sales Rep Bendeka.

The increase sales were partially offset by decreases in product sales over index due to lower volume on a low reorder cycle period, and the discontinuation of non alcohol dose. It does ddos attacks will injection in September 2018.

So Rob so product sales were $7.6 million in the fourth quarter compared to $6.8 million in Q4 2018.

Eagle recognizes bell reps or revenue on shipments by Eagle to wholesalers.

For the full year Bill Rep, so sales totaled $29.7 million as compared to $22.9 million in 2018.

Based on IMS data Eagles market share of Bendamustine wholesale shipments to end users was 5% of use spend unless the market for fourth quarter and 7% for the year.

Fourth quarter ended ex product sales were $3.5 million compared to $5.1 million in Q4 of 2018.

What is for Ryanodex are cyclical driven primarily by product expertise with few customers acquired dantrolene unless their stock is expiring.

We anticipate an uptick in Ranted X X free opportunity in 2020.

For the full year run Didix sales totaled $13 million as compared to $20.2 million in 2018.

Q4, 2019 royalty revenue was $32.8 million.

Appeared to $35.7 million in the prior year quarter.

Bendeka royalties were $32.4 million compared to $31.9 million in the fourth quarter two team.

Q4, Bendeka royalty revenue was negatively impacted by historical pricing trends.

However, the five point increase in royalty rate, which was effective on October one 2019 translates into approximately $70 per vial and incremental Eagle EBITDA.

For the year royalty revenue totaled $112.9 million.

Paired to $102.9 million in 2018.

[noise] Endeka royalties were $111.2 million in 2019 compared $134.4 million in 2018.

[noise] gross margin was 76% during the fourth quarter of 2019 as compared to 67% in the fourth quarter of 2018.

The expansion in gross margin in the fourth quarter 2019 was driven by a decrease in bendeka product sales to our marketing partner on which Eagle learns no profit.

And the increase in Bendeka royalty revenue.

On the expense front R&D expenses were $11.3 million in the fourth quarter compared to $5.9 million in the prior cool.

The year over year increases largely attributable to spending on fulvestrant and payroll expenses.

Excluding stock based compensation, another noncash or nonrecurring items R&D expense during the fourth quarter was $9.1 million.

As Scott mentioned the front end Q4, we invested $14 million to advance our pipeline.

$9.1 million, a non-GAAP R&D expense plus legal expense of $4.6 million on visa precedent PEM attractive.

Full year R&D expense decreased to $36.8 million in 2019.

Compared to $44.4 million in 2018.

Primarily reflecting a decrease in project spending for the company's Fulvestrant formulation.

Partially offset by the cost of bringing bays oppressed and to market.

Excluding stock based compensation and other noncash or nonrecurring items.

The expense in 2019 $31.1 million.

We expect R&D spend in 2020 on a non-GAAP basis will be 46, the $50 million as compared to $31 million in 2019.

The anticipated 2020 R&D spend includes number one the a 114 pilot trial in CMC initiatives.

Number two the ryanodex trials for treatment of nerve agent exposure and acute radiation syndrome.

Number three he want to 11 I have the enabling Tox studies in CMP scale up activities.

Before EA 112 formulation development and additional preclinical work at the University of Pennsylvania, and North Shore University Health system.

No were five regulatory advocacy for Rentech CHS.

And lastly, number six launch preparedness for visa precedent passing.

As gene a expenses the fourth quarter 2019 totaled $22.5 million compared to $15.5 million in the fourth quarter of 2018.

External legal spend associated with litigation on PEM attracted anvisa presson.

As well as payroll cost account for most of the year over year increase.

Excluding stock based compensation, another noncash or nonrecurring items fourth quarter 2019, SGN expense was $17.8 million.

Full year as she need expenses increased by $15.9 million to $76.4 million in 2019.

Compared to $60.5 million in 28.

External legal spend associated with litigation on PEM attracts and these are pressing as well as Pedro payroll costs account for most of the year over year increase.

Excluding stock based compensation and other noncash or nonrecurring items as Genie expense in 2019 was $56.4 million.

We expect our SG nine spend in 2020 on a non-GAAP basis will be 61% to $64 million.

As compared to $56 million in 2019.

The year over year increases largely attributable to higher sales and marketing payroll and visa press and marketing launch costs.

Partially offset by lower external legal spend.

If the ran it actually you're just label expansion is approved we will reset 2020 operating expense guidance.

[noise] net income for the fourth quarter was $1 million or seven cents per basic and diluted share compared to net income of $12.6 million or 88 cents per basic and 86 cents per diluted share in the prior year period.

Net income for the year ended December 31, 29 team was $14.3 million.

Or dollar for per basic and a dollar one per diluted share as compared to net income of $31.9 million or $2 16 per basic and $2.09 per diluted share for the period ended December 31 2018.

As a result of the factors discussed above.

Adjusted non-GAAP net income for the fourth quarter 2019 was $6.7 million.

Were 49 cents per basic and 48 cents per diluted share.

Compared to non to adjusted non-GAAP net income of $17.7 million or $1.23 per basic and the dollar 20 per diluted share in the prior year quarter.

Adjusted non-GAAP net income for 2019 was $36.9 million.

For $2.68 per basic and to those 61 cents per diluted share.

Compared to adjusted non-GAAP net income at $59.2 million.

Before those one cent per basic and $3.87 per diluted share in 2018.

For a full reconciliation of non-GAAP net income to the most comparable GAAP financial measures.

Please see the tables at the end of a press release.

Our EBITDA for the fourth quarter, 2019 was $10.7 million compared to $22.1 million in the prior year quarter.

Full year 2019, EBITDA was $49 million.

Compared to $71.4 million in 2018.

2019 Castro from operations, excluding shifts and receivables was $37.5 million.

As of December 31, 2019, the company $109.8 million in cash and cash equivalents.

And $48 million a net accounts receivable.

38.3 million of which was due from Teva.

The company had $39 million an outstanding debt.

Therefore as of December 31, 2019, the company had net cash plus receivables of $118.8 million.

The fourth quarter 2019, we purchased $3 million of Eagles common stock as part of our hundred $50 million share repurchase program.

From August 2016 through December 31, 2019, we have repurchased $171.9 million of our common stock.

With that operator. Please go ahead and open line for questions.

[noise]. This time, if he would like to ask the question. Please press star and one on your Touchtone phone.

So from the question Q by pressing the pound key.

Star in one.

First question from David Amsellem.

I personally.

Yes.

Hi, This is back on for David. Thank you for taking my question.

Yes.

Could you talk about whether you've gone past a target action date.

Got it.

<unk>.

And second I know you've talked candidly about the potential for it.

What is the level of confidence that you could settle with.

And then how aggressively pursuing a settlement.

One quick question, if you don't mind.

Could you maybe provide any additional color.

I'd be two injectables.

Thank you.

Thank you thanks for the for the question so look at the timing what we've stated.

Previously that I think it's important to follow to your question is we're fully expect that we will receive our approval for based pricing.

Hi.

They called predictions that we have here possible. So we expect to get approval relatively shortly here and then.

We wind up having a good rest of the time the court we expect to go to the market later this year.

In terms of a settlement, it's so hard to predict.

Predict these things we just believe that we're in a very good position when it comes to the paragraph or litigation that we're in.

And if all goes according to plan will be in court here in.

May already.

Which.

You get a decision in the normal course of time.

We'd get a court decision before the year.

We expect to have our approval well in advance of that.

That's the case, we have every opportunity.

Excuse me to go to the market before the years over and so.

That launches right around the corner. So we'll just have to see how things go with the rest of the discussions that we may or may not have but we just think we're in good shape. We're in good shape with Vecsey, we resolve that we're in good shape here. The most important element is that we just expectable monetize this very important asset to the company.

In the short term that's the takeaway.

And I don't have any other five or five be two injectables to speak about at this point other than what we've already disclosed we do have 10 projects in development and several launches coming up in an extra years I think five we mentioned and so it's pretty robust pipeline, we're pretty excited about the growth that we can have now starting just around the core.

Corner, so it's pretty exciting time to be involved with the company. Thank you.

Thank you.

Okay.

Our next question comes from Randall Stanicky RBC capital markets.

Great Great. Thank you Hey, Scott you called out potential for 2020 to be the best revenue even that gross profit year.

For the company. If we just focus on revenue I think that would imply better than $237 million, which just double digit growth. So question is can you help us think through the components of that and how you're thinking about bendeka royalties it sounds like you've got.

Some ryanodex and also be suppressed and Ah that expectation as well.

And then the follow up here I Didnt hear you talked before the strong but I I saw in the release it looks like there was a bit of a set back can you walk through where we're at without product and how to think about the path forward. Thanks.

Okay, Great Randall thank you.

Let me just make some general comments and I'll turn to sales number over to Pete if thats, okay, but.

Look if we wind up having the affirmation of the of the appellate decision for OTI, obviously that sets up very nicely. The next three years of the company, but in in our view, we're expecting NHS to be approved on or before the July 8th date and our internal forecast.

As a meaningful amount or NHS, if we get it approved in time for the heating season coming up but in addition to that RMH business is also doing rather well you know that's driven by expertise in in 2019, we had a cycle where there were just not a lot of expertise coming up and that all turned in two.

2020, specifically in the first quarters I think I mentioned in my comments that we could have almost as many sales.

In Q1 here as we did all of last year. So you can see how that strengthens our revenue and then bendeka is doing.

Well I'll wrap those doing well and it will get a milestone hopefully at of the Symbio relationship at the end of year, we could very well have what's a pretty good.

Year, a record year and then then you have to add potentially the base oppressed and launch into that which would really accelerate the growth pretty dramatically if that should happen and so thats, where those numbers come from Pete did you want to add anything else to the revenue line, yes, if I may let's just spend a minute on that on the Bendeka royalties ran don't thank you for the question.

You will have noted that bendeka royalties for the full year 2019 were down about $23 million year over year as we talked about in prior calls.

Substantial component of that is the price compression.

Caught $20 million in a in price compression on the GTN Bendeka, a volume was down a little bit not much on it a little bit of an offset of course from the fourth quarter royalty pump, which has an incremental $5 million a quarter. If you do the mathematics around five points of royalty and so that explains the diminution year over year of 23.

In dollars Randall I as we go into.

2020, we would note two trends one.

It appears based on the same data you look at ran to that we look at.

The IMS data appear to be telling us that the the GTN compression has abated.

In the minimalist remarket, let's hope that is accurate.

And also remember when I have a full year of that royalty rate.

Frankly, three three quarters of an incremental five then of course, another incremental point in the fourth quarter and so.

We look for Bendeka royalties to that growth you.

Ryanodex, even in the absence of easiest label expansion will be a growth here, we're confident telling you that given the expertise cycle and then of course CHS if approved would provide substantial ups on the on the Ryanodex number and so.

We do feel that 2020 rental could indeed.

We are best year on revenue, if a few things break our way.

Thank you. Thank you Pete and then Randall for Fovista and I Wouldnt necessarily say that we have said back at this point, we're just not quite there yet. These initial results didn't get as to where we want to be but we have a number of plans in place and thoughts and work going on and we're still very encouraged about that program and hopefully we'll have additional news relative.

At least soon to talk about let's see what happens. It's obviously such an important product I mean, just not for the company.

But for the patient population and we're working very diligently on it and.

Hopefully, we're we're making the right amount of progress. So, let's just see how that continues to unfold, but we didn't quite get there on this on this last past that we had.

We're continuing to.

The study it and hopefully we'll have a breakthrough here so.

Great. Thanks, guys.

Thanks Randall.

[noise]. Our next question comes from Tim Lugo with William Blair.

Please go ahead.

Hey, this is lock on for Tim Thanks for taking my questions. Just following up on the full the strep a trial. So it is that's I guess requiring an additional study beyond the pilot study or is it just more sort of de into the data you have there.

Just to talk in the portfolio.

Overall, what might that means the sort of.

Hi that will timelines you've provided the Pos.

And then second question.

In terms of yeah Ryanodex NHS.

Yes.

Is there any sort of change or any update on your level of confidence in the FDIC willingness to two except the combined offsets of the three years, though.

The let me let me ask to go to first question first and we have to repeat the second one but in terms of fulvestrant when we've spoken to everyone.

Weve recognized the fact that we reformulated last year and then we did a pilot study in healthy volunteers to gauge the direction of that re formulation and we always realized in our timing models that we may have to go back in there and do a little.

More pilot work in humans, and Thats, where we are so it's likely that we'll be doing a further human study prior to the pivotal.

Not sure at this point, what it does to the timelines I can't tell you as we sit here today that theres a significant.

Change in those timelines.

There might be and they're very well may not be we just need to do a little bit more work and now we'll report back but we have some pretty good thoughts we've been studying this for quite a while we continue to understand.

Requirements, better and better every time, we look at it and so.

Let's let's take a little bit of time, let's do a little bit more work, let's see where we are we're encouraged but there's still work to be Doug I don't think we know more than that to give you a better update that I just did.

So, let's let's see where we are and then in terms can you repeat your second question as it related to Ryanodex.

Oh, Yes, I was just wondering.

Yeah Jess.

Submission as I understand it was combining the data from the three is that you went to the Hodge I was just wondering if based on any discussions with the FDA if youre.

I guess perception of their willingness to.

You just those can find <unk> data sets from across the three is a it's changed at all.

As I said look we're we're expecting to have approval on or before the PDUFA date in the dialog we add into work that we've done.

For the knowledge level that we have right now during this review process. Our expectation is that we're going to be approved and we're moving forward in terms of to prepare for that launch and hopefully it'll work. This time for us, but as we sit on this call today, it's our expectation that we will be approved on or before that July.

But due to date.

Great. Thank you very much.

Thank you.

And again that is star and wanted to ask a question.

Next question comes from Brandon Folkes with Cantor Fitzgerald.

Hi, Thanks for taking my questions EM.

Firstly can you talk about the bone reps I strategy going forward, just give any step up and bendeka royalty does that strategy remain the same how should we think about peak sales Oh therapy market share there and then secondly.

Can you just talked about capital allocation priorities and Twentytwenty given that you noted you have a number of launches becoming just.

Do you feel the need to do what they need and willingness to do M&A and if so what are your priority thing. Thank you.

Thanks, Brandon So look though wraps the strategy has not changed.

We're pleased with where we are everything's coming together well, we do have to step up in the royalty, which as Pete mentioned earlier.

Has been working out well for us.

We believe that we could have a really obviously very strong 2020, just staying in the way that we're approaching the whole bend the Mustang franchise. So I don't see any major changes in our view of that marketplace and so thats all very positive I think we've seen stability in the market and.

Let's see what happens as we move through the year and on terms of capital allocation. It's I don't believe that Theres anything that's changed in our thought process there either.

Along the way we do have these 10 projects, we could have five launches coming up in three years I think the growth is right upon us.

All these things that we just spoke about work out for us in the in the near term, but you know we do have very good position and good opportunity to move forward, we have a lot infrastructure that could support another product or too and we continue to look and we may or may not pull the trigger and and look for things as ever.

We think that we're looking at in exploring has to compete with the pipeline and where we think it is today internally and.

Relatively look and obviously, we don't have anything to say today, but we'd like to get this company bigger and more profitable.

As quickly as we can through first and foremost or organic growth and development and should we find something that makes sense for us externally like to go ahead and do that to add on to everything we can do.

Great. Thank you.

Thank you Brandon.

[noise] and we'll take our next question from Greg Gilbert with Suntrust.

Hi, Good morning, Scott I wanted to ask you about NHS I'm curious, where you think the stock the product would be stocked initially and maybe you could characterize for us how the provider community.

How their awareness is ahead of this potential approval and their readiness given that it could be a practice changing or would be a practice changing kind of product.

Great Great question, Greg and thanks for the thanks for the question, So yeah chess and and ran index in general just shaping up to be a very interesting situation. So the best way to describe that is there are give or take 5000 hospitals in the U.S. of which have stock.

Brand index today, we have about a 50% chair give or take of the number of hospitals stocking.

That stocking is obviously in the operating room in the event of an MH situation and not in the emergency room. So let's just focus first on the non stockers today, those 2500 hospitals that are not stocking the product.

When CHS is approved we thing you know just about all of those hospitals are going to need to stock and if they don't stock immediately they're gonna have to stock most likely if the velocity that we think is potentially there you know you start seeing a couple of patients are going to need to have the product. It's emergency product you can't exactly call your wholesale.

Learn habit delivered to your why you have a patient sitting there and so there maybe four or five.

Miles that need to be stocked in those other 2500 hospitals right off the bat.

And then the hospitals that are currently stocking the operating room, they probably need to have some bio down in the emergency room. So this is clearly an emergency room product, where hospitals are gonna have to stock and be ready because it's an emergency situations I think our growth is going to come from two areas. The stocking at the beginning and then.

Whatever usage, we get along the way as we have heatstroke subjects coming into the emergency room.

Do you see that product getting to ambulances or in the hands about thought of trainers at schools or anything like that or is that a longer term.

Yeah, we don't see that happening.

In the short or mid term at all I think it's going to be emergency room drive, let's just get everybody used to using the drug and see how things go but it's clearly an E are proving process.

Hi, Thanks.

Thank you Greg.

And there are no further questions at this time, so I'll turn it back to the speakers for any closing remarks. Thank.

Thank you so look to wrap up you know as I stated earlier 2020.

Really be the best year in Eagles history in terms of total revenue and gross profit.

No just followed by an accelerated period of growth over the next several years for the company and this includes affirming the orphan drug exclusivity for Bendeka and the Hs approval and then before the years over you know hopefully launch phase of Crescent filed for nerve agent you start to add in the $10 million to $25 million per year that we expect to go.

Yet from Symbio, starting with the $5 million milestone payment. This year and then you have to yourself into the pen sexy launch at the beginning of 22 four months before we anticipated alimta and to entry and this doesn't include the value that we may still fine.

From a you know hopefully fulvous threat, followed by a dramatic brain injury caution in Alzheimer's disease, and then has to questions. We had earlier today anything that we still may acquire and so we are excited about the growth trajectory and look forward to reporting on our progress of the.

So.

It's exciting time to be involved with the company and thank you for support and being on the call today, we greatly appreciate it. Thank you.

This concludes today's program. We appreciate your participation you may now disconnect.

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