Q2 2020 PDL BioPharma Inc Earnings Call
[music].
Well because appeal BARDA formal second quarter 2020 conference call.
All participants will be in listen only mode.
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After todays presentation, there will be an opportunity to ask questions to ask a question to me Press Star then one on your telephone keypad.
The majority of question. Please press Star then too.
Please note this event is being recorded.
Now, let's turn the conference over to Jody Cain. Please go ahead.
This is Jody Cain with L.A.J.. Thank you all for participating in today's call. Please note that a slide presentation to accompany management's prepared remarks is available in the Investor Relations section of the PD L. website at PDL Dot com.
Joining me today from PDL Biopharma, our Dominique Monday, President and CEO, and Edward and brought though vice President and CFO.
Curtis CEO of LENSAR will join us for the Q and a portion of today's call.
Please turn to slide two and let me remind you that during this call management won't be making forward looking.
I.
Finally formats and other matters and actual results may differ materially from those expressed in or implied by the forward looking statements.
In particular, there are significant uncertainty about the duration and potential impact of the covert 19 pandemic. This means that results could change it anytime and that the impact of covert 19 on P. deals operations financial results and outlook is best estimate based upon Dave.
Nation available for today's discussion.
Factors that may cause differences between current expectations and actual results are described in the company's FCC filings, which are available at FCC Dot Gov and in the Investor Relations section of PDL Dot com.
The forward looking statements made during this conference call contain.
Call should be considered accurate only as of the date of the live broadcast August 620 20.
Although the company may elect to update forward looking statements from time to time in the future. The company, specifically disclaims any duty or obligation to do so even if new information becomes available or other events occur in the future.
Today's conference call remarks will include a discussion of both GAAP and non-GAAP financial results PDL believes the non-GAAP financial measures provide investors with useful supplemental information about the financial performance of its business and able to comparison of financial results between.
Periods, where certain items may vary independently of business performance and allow for greater transparency with respect to key metrics used by management and operating the business.
These non-GAAP financial measures are presented solely for the informational and comparative purposes, there should not be regarded as a replacement for corresponding GAAP measures.
Reconciliation between GAAP and non-GAAP financial measures can be found at the end of the financial results news release that was issued earlier today.
Before turning the call over to Dominique minute <unk> I'd like to direct you to slide three in reference to P. deals proxy statement filed with the FCC on July 720 20.
Now I'd like to turn the call sort of Germany.
Thanks, Jody <unk> good afternoon, everyone and thank you for joining us I am pleased to report that we made significant progress you de execution at all I said Moneypak station strategy during the second quarter and in recent weeks.
Our teams that PDL LENSAR and no debt Covenant, we've all board and advice is I think you could use some key transaction.
As outlined on slide four we remain committed to all strategy aimed at money tightening I'd say and distributing there that you had the most tax efficient manner to all stockholders.
Yeah, I know upcoming enroll meetings, Oh stockholder approval proposal to file for especially because of distribution was the state the Delaware.
We would expect to file would be subject became within the next 12 months.
And Wayne the boat decided that he would say based interest the PDR stockholders.
Well, we've continued to be bean and diligent in executing our strategy and to address the cost structure as we continue to die to say.
You know they can maximize net proceeds for all stockholders.
I will begin by recapping, our progress today, including stuff more transaction, we recently announced.
Turning to slide five.
Beginning with all hoarding enable fame Bobby passage.
We completed a distribution of PD L Holdings, a 13.3 million shares if people think common stock on may 21st.
Which at the time represented approximately 27% of able thing outstanding common shares.
So disbursement disbursement was making the for the part that piece or onetime common stock dividends to PDL stockholders of record as does the close of business.
On May 15 2020.
Oh this is going to distribute able himself with might have to exploring a number that you know jeeves, including the sale of the shales private sale or secondary offering.
We concluded against such transaction as they would have been done at a substantial discount because the share price.
We have time to share distribution to be shortly before the idea. They just got date for April and fixed fee for the prevention of pregnancy.
Hi, I'm going all stockholders to make their decisions regarding that able same holding a wrong peasquito inflection point.
Fixed he was approved on May 20 seconds, leading to a significant increase in the share price and trading bogey.
We believe our execution of the distribution served all stockholders well.
All these distribution as these distribution was made to see on to plan a complete liquidation is expected to decrease the U.S. stockholders tax basis, Pts, though by 56 cents.
We thank our advisors Toia partners and SBB, leaving for guidance.
Do you have proxy much value of David <unk> common stock, we distributed with $64.4 million owns the date of the distribution.
And does a distribution ratio this equates to $4, an 83 cents variable cam shares.
During the week after memorial day, they become shares traded at an average of $5 in 68 cents per share.
You may recall repurchase either thing common shares took a day week 3.3 million well and combine price of $4 50.
These purchases where transacted for a total of $60 million completed $230 million country in April and June 29 team.
[noise] video continues to hold Freeport 3 million able thing watch.
It's well it can be able to size the oneself it'll same common stock at $6 in 38 cents per se.
We are delighted that developing received FDA approval Pixie and we are highly supportive to the company and his management team.
We wish they match successful the compressor lontra fix it.
We continue to many till April pain, and will determine disposition as well and anytime we believe we optimize the value for our stockholders.
Turning next to no then following up on slide six.
I was very pleased with our entry into a definitive agreement to sell 100% of the sale of the stock of node into the UK based private he could you couldn't Stanley capital, which we announced on July 30 year.
This is another significant step in the execution of on many times vision strategy.
The total value of these transaction is up to 48 point $25 million or paid in cash.
We will see the payment of approximately $12 million when the transaction closes which is expected by a mid August.
An additional $33 million will be paid unique whole installments of the $2.75 million each of the 12 quarters between January 2021, and also the 2023, we the potential for two additional contingent payments totaling three point $25 million.
He has bought a management team together, we've all financial advisors toy and SDB Leerink evaluated the number of potential options to maximize stockholder value for no day.
We moved forward with the transaction, which then they capital, which we believe a piece of the greatest total value for these assets and the greatest certainty or the time equalising.
Importantly, this transaction is what do you think of the $38 million down keeping novartis and does that do then supply agreement.
We offer all since your fast you see on Inaki and the entire new then team for their dedication over the years and we wish no then instead lake I recall must future success.
Moving onto our remaining assets Outbidding, we've all majority owned subsidiary lens out on slide seven.
On July 17th we announced Atlanta, I Confidentially Thier filed a form 10 registration statement was the FCC relating to potential spino as a standalone publicly traded company.
The decision to take the necessary steps to enable a spinoff of LENSAR west made by our management and board and under the advisement SBB Leerink.
We cannot provide issuance that we will proceed to the spinoff of blend though.
We believe the talent pursuit of its strategic transaction or the potential spino Wheeler Timothy yields the based outcome false stockholders.
We see significant value in lens out as an innovation leader for cataract surgery.
Linzess net sales for 29, T. with $30.5 million Weve Toby.
Pre Colgate revenues growing 20% to 30% annually over the past several years.
Well should use volume in 2020 as being negatively negatively impacted as a pandemic as cataract surgeries conceded elected in most cases.
Cataract surgeries, one at the highest volume surgical procedures in the world and we expect that the cataract surgery market will progressively brands it back to pre Cobiz 19 labels as a pandemic subsides.
Linda will again be positioned for growth competing as a premium segment of the market new typically see significantly broadening its market, which is 2022, we expected commercial launch disruptive technology second generation system previously known as Gentoo and now trade name.
Ally.
And I integrators, Femtosecond laser with the Peco investigation system is a compact mobileye workstation designed to address all cataract procedures and E without limitation.
Premium procedures.
Finally, it is worth noting the fact that the vast majority of Linda procedures are performing ambulatory surgery centers why they're going hospital, we set for the company. Some protection in the event of the broad scale return of Cobi.
As a cataract market progressively returns to its prequalified level like that is well positioned to reduce its course trajectory.
Now on slide eight.
Blends out its position as an innovator for the treatment of cataract that require greater accuracy and how should you have customization.
Between 70% and 90% of cataract patients treatable. These really significant estimate is in prior to surgery.
Defective monkeys and remain largely uncorrected post injury.
Lets that teaches at best in class technology would be to streamline poll system, which enable surgeons to optimize the surgical management of estimate is them to integrating multiple pre approved you've diagnostic platforms, we why connectivity and I, we switch restoration.
Three identifies a proper axes divesting, but he said intra operatively, we've got manually marking the eye or transposing the data.
As mentioned.
He's really significant antibodies and exiting the majority of cataract patients, which is a market LENSAR addresses.
In fact, Linda kept at 13% of global Femtosecond laser eye sticky cataract surgery or plaques procedures.
As we have previously disclosed and enzymes developing its next generation system ally, which is expected to promote the addressable market to include all cataract procedures.
As well as to significantly enhance Linda competency that position.
And I, we even will integrate into cinco compact mobileye workstation.
And enhance them to a second laser and a well known high performance technology Peco intensification system.
Providing surgeon, who is the ability to switch seamlessly between the two technologies.
Further lenders intellectual property secures a premier technology position for developing and commercializing this disruptive technology.
If we were to decide to move forward with the spin off lens that will be well position to be distributed to all stockholders as an independent publicly traded and city.
And every scenario, we would ensure that linzess is well capitalized to read unit growth trajectory and to launch a line successfully in 2022.
I invite you to of use Atlanta presentation, which is available on the Investor Relations section of our website under events and presentations.
Moving onto slide nine we shows our updated royalty portfolio.
We are confident in the cash flows generated by these assets in particular of the royalties and limits on other extended release combination products of metformin using excess use more defined we lost technology.
We set a high ball for sale of these assets.
As alternative remains to hold on to this loyalties in a cost efficient structure and to distribute the revenues to offset to all stockholders.
This being said, we continue to explore sale, but who provide comparable economics for stockholders.
Turning to slide 10.
With the asset a help at PDL accounting for the transaction completed today.
We estimate the proxy statement the value of PD l., including the distribution of gave them common shares.
To be in the range of $360 million to $680 million, all $3 in 16 cents or $5 in 97, thanks for share.
As we work towards distribution, we are taking action to ensure operations our cost effective scrutinize net return to our stockholders.
By the end of August we will have reduced our staff at TDR by 25% since we started our monetization process.
I'd like to personally thank each of our employee work work diligently and very effectively who the process to execute these transactions.
As we move who's a de solution process, we maintain our focus and aligning our cost structure Weve remaining operations again to maximize net stockholder returns.
Turning to slide 11.
As a reminder, proxy statement has been filed with the FCC with a record date of July 2nd 2020.
We will be holding all 2020 annual meeting of stockholders individual format on Wednesday August 19th at 10 Am Pacific time.
Our board urges stockholders to carefully read the proxy statement and to vote for the first chronic proposal has put four and again.
To stockholders proposal numbers speak as it is we'd done done with our own proposal to the classified the mall.
Instruction for stockholders to attend severe toward meeting and the proxy statement.
We expect to announce the results of voting against that meeting.
I want to direct our stockholders to pose a number three of the proxy statement.
With couples all relates to approval for the dissolution of the company pursuant to the planned to be solution, which is included in an area of the proxy statement.
PDF management and board believe its plan is in the best interest of all stockholders.
All of the plan of distribution is subject to an attempt you birds eye to holders of the majority of our outstanding shares of common stock.
He solution as the company I've, Germany to additional distribution of its key assets.
Will allow an efficient wind down of the company's operation.
And protect stock holders from reliability from claims or during or after the distribution period.
In addition.
He solution will allow the company to reduce overhead expenses that it will no longer be a publicly traded company, which is in keeping with our commitment to execute a cost effective wind down.
And your timidly maximize total distributions to stockholders.
ISS and glass Lewis recently issued recommendation supporting the dissolution proposal.
Turning to slide 12, I'd like to review sub 40 point is a proposed plan of distribution.
The company, we still exist after filing the syndicate distribution was the state the Delaware for at least three years.
Finally for wind down purposes.
We can't tell you. This requires is required and there's a lot of Delaware, We're PD L. incorporated.
It allows for managing potential litigation resolving any claim and disputes monetizing any remaining active.
And facilitating distributions.
It also provides a handling of remaining stockholder administrative issues and for final distribution.
The three year period begins when do certificate of distribution is fine with the state of Delaware.
And the decision timeline may be extended beyond three years if necessary.
The plan of definition permits the board to abandon or delays of filing of the certificate of distribution and the implementation of Citi submission due to changes in circumstances or east, India based interface, the PDL and all stockholders.
In view of this flexibility regarding both the decision and timeline for the solution.
We are highly confident that getting stockholder approval for kind of the solution will not affect the value that we can capture crew or monetization process.
Now on slide 13.
The cast act, which was passed into law in late March 30, taxpayers UK back five years any net ordinary losses arising in the taxable years, beginning in 2018 2019 or 2020.
In connection with all monetization process, we have engaged in and they take to execute transaction in 2020 that May result in the recognition of ordinary tax losses that and there's a care that.
Could be applied to prior tax years in which PDL was a substantial taxpayer.
I wish to cap to stress that they can be no assurance that such tax benefit will be realized but we are certainly considering these potential tax aspect.
We plan to maintain a strong balance sheet as we execute our strategy to maximize net stockholder return.
We have seen buying back stock under our share repurchase program. It is important for us to retain sufficient funds to pay amounts owed to our creditors as we move toward you solution.
If we were to fail to do so our stockholders could be held individually liable for the repayment creditors out of GM and previously distributed to such stockholder in the distribution.
In short, we don't want to another cash to pay all obligations would usage.
Within the literally consideration, we tend to make distribution to all stockholders as appropriate prior to the solution.
But at least I'd like to thank GLG, our vice President business development, we will depart PDL mid August.
He has served as a key member that our management team and has been guiding Pds business development efforts for the past two years.
Deal and her team as the instrumental in the execution of our monetization process, including the able can share distribution in the center no debt.
It was a privilege and pleasure to partner with her.
On behalf of the whole PDL human goal that we feel continued success in a future Davis.
And also like you think paulson nine we will be retiring from our boat for a week the annual meeting of stockholders.
Well I served as a director PD L. since 2008, and we have highly valued over the years deep expertise intellectual property litigation and his guidance, particularly in corporate governance matches.
We are grateful for his service to PDL and we've seen well in his retirement.
With that.
I'd like to turn the call over to invoke no to discuss our financial results. It.
Thank you Dominic.
Before I begin my review of our second quarter financial results.
It would be helpful to provide some context of the presentation of these results.
Due to PDL and plan to monetize the company's assets in the resolution to seek stockholder approval because there's no other company along with the initiation of the process to sell certain of the company's assets in the first quarter of 20 to 20.
Our royalty assets and Noden met the criteria to be held.
Classified as held for sale and as discontinued operations.
In the second quarter of 2020, Twond the distribution of the Eagle from common stock to PDL stockholders.
Discontinued operations criteria are met for the strategic position segment, which is comprised solely of the company's investment Nivo fan.
In meeting the criteria PDL is presenting these assets and liabilities held for sale separately on the balance sheet as of June Thirtyth 2020.
As of December 31st 2019.
The statements of operations for the second quarters in six months of 2020 and 2019.
Report the results of these operations as discontinued.
With that his background lets now turn to an update of our Q2 financial performance beginning on slide 14.
Total revenues from continuing operations for the second quarter of 2020 were $5.2 million and consisted primarily of plans our product at least in services revenue.
Lender revenues were $5.1 million, a 31% decrease over the prior year period with procedure volume also declining 31%.
As Dominic mentioned the decrease was primarily due to lower system sales and procedures driven by the negative impact of the covered 19 pandemic and the associated deferral of elective.
Medical procedures.
Turning to operating expenses.
Q2 operating expenses from continuing operations include general and administrative expenses for corporate overhead as historically a significant amount of these costs has not been allocated individual segments.
Operating expenses for the second quarter 2020 were $19 million, a 2.3 million dollar increase from the second quarter 2019.
The increase was primarily due to severance and retention expenses incurred in the second quarter 2020 with no such expenses incurred in the second quarter of 29 team.
Higher general and administrative expenses, resulting from increased professional fees associated with the ongoing monetization efforts.
And higher research and development expenses, primarily due to the development of L.L.A. lenders next generation workstation.
These increases were partially offset by lower cost of product revenue, we reflective of lower revenue as previously discussed and lower sales and marketing expense for LENSAR.
Net loss from continuing operations for the second quarter, 2020 was $12.9 million compared with a net loss of $8 billion for the second quarter of 2019.
Moving on to discontinued operations.
Loss from discontinued operations for three months ended June 30 2020.
Was $37.4 million compared with that $3.5 million of income for the prior year period.
The second quarter 2020 loss includes a $12.9 million decrease in the fair value PV House holdings in Eagle trend as compared with a 45 million dollar increase in the second quarter 2019.
The 6.8, knowing that our loss associated with reducing the estimated fair value nobody has informed by negotiation and turns for the disposition of the entity.
And the $2.2 million decline in revenue from the notice segment compared with the prior year period.
Resulting from higher sales of our authorized generic and lower sales in the U.S. of the branded drugs.
These amounts were partially offset by revenue from our royalty right assets of a negative $16.3 million for three months ended June 30 2020.
Compared with a negative $40.4 million for three months ended June 32019.
With the difference primarily resulting from the 60 million dollar accelerates write down in the second quarter of 29 team.
Compared with a $22.9 million write down in the second quarter.
2020 for certain of our royalty assets as informed by bids received during our monetization process.
Our royalty right assets generated cash flows of $11.5 million loss from the change in fair value of $27.8 million in three months ended June 30, 2020, compared with cash flows of $20.1 million and a loss from the net change in fair value of $60.5 million in a three.
Months ended June 32019.
On a GAAP basis.
Net loss for the second quarter, 2020 was $15 million or 43 cents per share compared with the GAAP net loss of $4.4 million for four cents per share for the second quarter of 2019.
Turning to our year to date results.
Revenues for the first six months or 2020 were $11.2 million compared with $14.2 million in first six months of 2019.
The decline was primarily due to lower lines, our revenue related to the covered 19 pandemic.
Operating expenses from continuing operations for the six month period in 2020 were $56.7 million up from $31.6 million for the prior year period.
With increased <unk> due primarily to current year severance and retention expense of $22.3 million.
Substantially most of which were incurred in scores in the first quarter.
With due to higher Gionee expenses, primarily resulting from increased professional fees and hired.
R&D expenses, primarily due to the development of Alley, offset impart by lower cost of product revenue associated with the previously noted decreases in revenue and reduced sales and marketing expenses.
Net loss from continuing operations for the first half of 2020 or $32.2 million versus $16.5 million for the prior year period.
Net loss from this discontinued operations for the first six months of 2020 was $50.2 million compared with net income from discontinued operations of $18.6 million for the first six months of 29 team.
Loss from discontinued operations for the first six months of 2020 included $26.7 million decrease in the fair value Pdrs holdings legal trend compared with the 45.5 million dollar increase in Tony 19.
23.5 million dollar loss associated with reducing estimated fair value of knowingly and the $70.2 million declining revenue for an annuity segment compared with the prior year period.
These amounts were partially offset by revenue from our royalty rights assets have been negative $6.9 million from six months ended June 30 2020.
Compared with a negative $28.1 million for the six months ended June 32019.
The difference was primarily due to a large decrease in fair value in the first half of 2019, resulting from the $60 million Stellarex write down.
Paired with the first half of 2020, which includes a fair value adjustments for certain of our royalty rights as informed by beds received during the monetization process.
Our royalty right.
Has generated cash was a $25 million in the six months ended June 30, 2020, compared with cash flows at $32.7 million in the six months ended June 30, 2019th.
The net loss attributable to PDL shareholders for the first half of 2020 was $81.7 million or 68 cents per share.
Paired with net income for the first half of 2019 of $2.3 million or two cents per diluted share.
Moving to our non-GAAP financial results on slide 15.
The adjusted non-GAAP net loss attributable to PDL stockholders for second quarter of 2020 was $23 million compared with adjusted non-GAAP net income of $12.7 million for second quarter of 2019.
The adjusted non-GAAP net loss attributable to PDL stockholders for the first six months of 2020 was $29.7 million compared with adjusted non-GAAP net income for the first six months at 2019 of $24.5 million.
Turning to our balance sheet on slide 16.
We had cash cash equivalents from continuing operations at $105.4 million.
As of June 30, 2020, compared with $169 million as of December 30, Onest 2019th.
$63.5 million reduction was primarily the result of common stock repurchases of $39.4 million net cash used for the repurchase of convertible debt of $18.8 million.
And net cash used in operations or $33.8 million. This reduction was partially offset by the cash received from royalty rights of $25 million.
With that financial overview, we're ready to open call for questions operator.
Thank you we will now begin the question answer session.
Sure ask a question your press Star then one already touched on some of those who are usually the speaker. So we are seeing foods for younger handset Overpressured keys to enjoy your question. Please first store them too.
At this time, we will pause momentarily through some more roster.
Thank you operator, while we are waiting for the first question I'd like to remain stockholders, but our via troll and or meeting will be held on August 19th beginning at 10 Am Pacific time.
By now you should have received the proxy statement you can't goes by mail by phone or by Internet voting instructions are on the proxy card that accompanies the proxy statement again, our board encouraged stockholders to vote for the first five proposals they asset for the post proxy and again.
The six as it is redundant we've our own proposal to do you classify the book.
Okay. Operator, we are ready for the first question.
Thank you. Our first question comes from kind of tuck ins with Cowen and company. Please go ahead.
Hi, Thank you for taking my questions. Just wondering if he could elaborate a bit more on how you plan to monetize the 3.3 million.
Some warranties to hold.
Yeah. There is no loss to elaborate at this point and I think with the stock price of April Fame dropping.
As a result of their.
Financing around I think clearly is the time, if not now to be at such a low price, which we don't think it was sort of all shareholder well. So can I think what we are going to do is that is just essentially because we trust is going to happen. It's worked for the launch of sexy and the essentially wait for the star plans to go back.
Cap and at that point, it would improve that that value and they all some interested parties. We have been a quote structure to buy them is just the price with another wide price.
Ed do you want to add anything to that.
But no dominated thank you covered it well thank you.
Okay and then also just wondering if you could [noise].
Tell us what are the terms of that payment and the contingent payments those last two payments associated with the Noden deal.
Yeah, we have not met or both public and can I think.
The first payment, let me give it to you in policy Vicino terms and the first one theepan.
On the execution of.
The vision and that's 10 Lake capital as for no then which has the describe essentially they see as a platform on which to built.
And because these realize additional addition drives a lot of the financials, we agreed to and to add some contingent payment, which we dependent on one transaction. So that is it is one deal. The one is.
Essentially as positives with negotiation, we agreed to a share and it's a payment which would be expected at both parties were looking at VSS coming to them. So we couldn't agree we agree to divide it. So that these are the two payments and they add up for the 3.25 million.
Dolls.
Okay. Thank you for lunch.
Thank you.
Our next question good cultural immersive injector with Edison Group. Please go ahead.
Hi, everyone. Thanks for taking my questions.
So so I'm just not my first question is just on underlines our potential spin out any color at all you can give us on the potential timing for that.
Well the potential timing as.
Yes, I can give you some some call and.
<unk>.
We like many others are looking at the period around the elections as being one of the turbulence and then probably not a one to be conducive to to execute the successful spino for an IPO aware this such transaction. So we're looking at either staying ahead of this.
Or doing it afterwards, I think it's a fair point and if the market were not to be affected as we expected to be Gulf and some in some other opportunities in between.
So we vision mine, we are Lenval filed confidentially for its form 10, and assuming that and we bring the this process to close the CAC sees these ongoing as you can imagine.
Then I think the earliest which could happen would be sometime in the second half of September.
And.
So early as to be second in the second half of September and if it were not in probably then you can look at it may be until maybe mid October all something of that kind. It's it's a soft kind of timeframe, but we probably then we stay or how out of the election.
Season, and if we have not executed at that time, and we have not executing the strategy transaction, which as you know is another option because you then we would.
We would we consider it on there on the backend in that in 2021.
No.
Does that answer your question.
Yes.
That's very helpful. Thank you and that just on the lens are procedural volume any color you can give us on the just how it's been doing like this summer I saw the the revenues in June were pretty much level with like in February.
In the lines our presentation that you have on your website. So I was just wondering like water procedures during a visit following valid how's that.
During the summer.
Thanks obvious question, Mike and I'm going to directed to the experts in the room and it is there Nico T.C.O. Mendez. So Nick do you want to give some color on that.
Sure Unlike launch.
No problem Dominic so.
We've seen procedure volume.
Across the board in different countries continue to rebound.
I would say that on average most countries are still in the neighborhood of between 65 and 75% of pre co bid levels of there've been a lot of changes that they've had to implement into the practice and depending on whether theyre ASV based or hospital based.
Either increases that intensity of different procedures that they have to follow up or they have more control over over those procedures in the than say a surgeon owned ambulatory surgery center, but generally in the neighborhood but between.
The 65, and 75% pre covert levels.
[noise] okay.
And then just one last question and this is bar on the the royalty assets and the changes in fair value. So.
During the quarter or you know there there were some.
Small negative changes in fair value for for several of the assets. So just wondering if there's anything you could tell us on the.
Any of the product specific reasons for a further changes.
Ed do you want to address my next question.
Sure Matt.
The biggest change for the quarter related to the accelerates the royalty asset in that particular asset the.
Partner company to accelerate experience, though had returned its license to accelerate as footnoted in this slide deck to the presentation that was done today.
And because they were in a period of or not.
Turning royalties on a particular asset we adjusted that down.
And there were several other well rounded off essentially and then there were several other assets that we had some some bids.
We received during the quarter without were.
Representative of fair value and we adjusted the those asset carrying values accordingly, but that didn't apply to the total people it was select assets within the pool.
Which.
Resulted in some of those adjustments you're saying.
And like the Phebe asset I cant pronounced evergreen ounces the school see brothers.
The that seem to be a large percentage of kind of what the total value of the asset was that entity to say on that one.
It was that one was also adjusted according to to our ongoing processes and it has been performing a little bit.
Below the surface in terms of our projections that we took a look at that this quarter and in addition to the the processes are ongoing we adjusted downward.
[noise] Okay, great. Thank you so much that that was very helpful. That's all my questions.
Thank you back.
Ladies and gentlemen. This concludes the question answer session I wasn't during the conference Dr. will dominate already for me farmer.
Thank you all once again for joining US today, we look to you and your family's out well and staying healthy and we look forward to updating you on our progress during our Vivitrol annual meeting on August 19th and the subsequently outdoor next quarterly call in November.
In the meantime, we wish you a wonderful rest of your day. Thank you.
Thank you Sir This concludes todays conference call will take you all for attending today's presentation. You may now disconnect. Your lines you remember wonderful day.
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