Q2 2020 Eagle Pharmaceuticals Inc Earnings Call
Good morning, welcome to todays program My name is keep and I'll be your conference operator.
At this time I'd like to welcome everyone to Eagle Pharmaceuticals second quarter 2020 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.
Time, if you have a question please press star <unk> well.
As a reminder, this conference call is being recorded say August <unk> 2020, It's now my pleasure to turn the floor Roberta Ms., Lisa Wilson Investor Relations for Eagle Pharmaceuticals. Please go ahead.
Thank you Keith welcome to Eagle Pharmaceuticals second quarter earnings call. This is Lisa Wilson Investor Relations for Eagle Pharmaceuticals.
With me on today's call.
Our Eagle Chief Executive Officer, tariff and Chief Financial Officer P. Myers.
It's more in a company. It's you [laughter] detailing financial results for the three months ended June Thirtyth 2020.
Well.
So some of this call <unk> can be accessed through the investor section of the Eagle website at Eagle U.S. Dot com.
Before we get started I would like to remind everyone.
Any statements made on today's call them, all but a belief expectation her jackson forecast anticipation or intent.
Regarding future events in the company's future performance, maybe considered forward looking statements as defined by the private Securities Litigation Reform Act.
These forward looking statements are based on information.
Available to Eagle Pharmaceuticals management as of today.
And involve risks and uncertainties, including those noted in this mornings press release and our filings with the FCC.
Such forward looking statements are not guarantees of future performance.
Actually was.
Materially from those projected in the forward looking statement.
Eagle Pharmaceuticals, specifically disclaims any intent or obligation to update these forward looking statements, except as required by law.
It telephone replay will be available shortly after completion Oh.
You'll find the dial in information in today's press release.
Archived webcast will be available for one year on our website Eagle U.S. Dot com.
The benefit of those who maybe listening to the replay or archived webcast. This call. We saw the recorded on August 2020.
Since then you go may have made announcements related to Todd. This is Scott. So please weapon become these most recent press releases and I'd be filing.
With that I'll turn the call over to Eagle CEO Scott here.
Well, thank you Lisa and good morning, everyone. We had an excellent burst out when it comes to our earnings.
The strong first quarter and we have followed up now with a strong second quarter.
Generating EBITDA and point 8 million.
50 cents in diluted non-GAAP earnings per share.
Our sales force he's done a tremendous job.
We are proud of the fact that while chemotherapy visits are down double digits, and we still don't have full access to our customers due to cold it.
Which we expect to return in the second half we maintained strong earnings keep in mind, we don't have products in our portfolio.
It didn't benefited by cold. It back we have also had de stocking headwinds for bell ramp. So in the first half that we expect will reverse going forward.
We have a healthy balance sheet to enable continued investment in our pipeline programs and have added to our clinical teams further support our goals.
The quarter a panel the DC circuit affirmed the lower courts ruling in our orphan drug exclusivity case.
And we prevailed in our district Court patent litigation against four Bendeka and be a pilot.
That's great news on FX, C., which includes the final approval from F.D.A. since our settlement last year and the recent approval.
For a multi dose spot.
We also received the unique Jacob.
And given our initial period of exclusivity in 2022. This represents a significant opportunities for Eagle.
A longer life cycle.
Then originally anticipate.
And last week, our strategic collaboration partner time technologies, and now that F.D.A. granted orphan drug designation sports lead product candidate.
Mediated treatment for patients with pancreatic cancer.
Now looking ahead, we have a lot of important work to do in the second half year, along with several important opportunities.
Expecting to get another approval for bend it must be did our licensing partner Symbio late this year and we see long term value from upstream that income stream.
In a few minutes Oh share plans to get days, a precedent to the market as soon as we can.
We're also making progress with F.D.A. around the nerve agent indication for Ryanodex and we still remain very excited about the best.
Now, let me share the specifics on these programs a walk me through our plans for the balance of the year and into 21.
I'll start with oncology opportunities regarding our oldest ran product candidate you won 40.
Which targets estrogen receptor positive and breast cancer.
Our work here could represent the cornerstone of our oncology franchise and potentially are most significant pipeline opportunity.
More importantly, our product could substantially improved the clinical outcomes for these post menopausal metastatic breast cancer patients.
In our pilot study in healthy post menopausal women, we previously.
Matt our initial internal objectives and back just recently received additional data from this study that is also very encouraging.
Our next step started meet with the agency to finalize our clinical plans and get the product to the market is additionally, as we had after the FDA meeting we will finally provide more details about eagles concept in treating these women and why we believe it represents a significant benefit in the market.
Let me also briefly.
Talk about Symbio and Todd.
Symbio, our Japanese licensing partner expects to receive approval of its ready to dilute liquid bendamustine product, which triggers a 5 million dollar milestones.
Followed by the potential of $10 million to $25 million in annual royalties from Symbio first launching the 500 and all bag and then the 50 ml back. This represents a meaningful income source for us going forward.
We're also encouraged by what we're seeing in time study, that's an 88 a. late stage nobile investigational agent for pancreatic cancer.
Ward to update you as we learn more.
Ultimately our oncology franchise did not only include oldest rad.
Deck no wrap so FX c. that will launch in 22 under license from Eli Lilly and asked them 88 for pancreatic cancer under the license from time technology.
Now, let me turn toward critical care franchise.
Starting with bays, oppressive, which we feel very positive about and anticipate approval in a reasonable timeframe.
As we've stated over the past two years the development of days a precedent is complex.
He's a Christian is a complex apiay being first to file required us to perform significant work.
By the end of this year, we would have invested $25 million illegal and R&D expense under development.
This product.
These are presently is an older poly peptide product originally approved based on published clinical experience and chemistry data.
Field of polypeptides is rapidly evolving and ft AIDS, incorporating new scientific standards, which will also apply to other diesel Crescent Aviate filers not just the.
Much of the work that we've been doing is new to the molecule.
Obviously this is not a first cycle review approval and there is recently asked as you specific questions all of which we anticipated but one.
Fortunately our signs as it relates to this project is dee.
And we hope to respond in totality to the questions raised by the a next month.
You're working with the agency on the new Polypeptides standards.
And while those conversations do not allow us to accurately forecast the timing of the approval at this time all outstanding questions may very well be cleared up by the end of next month as our testing is complete.
Additionally, based on the nature of these comments from F.D.A. and historical precedent that we do not believe that we are in danger of losing our exclusivity. This is obviously not certain but we do have a good level of confidence here.
Next I'd like to address our launch Todd.
Hope it is unfortunate on so many levels.
Our trial date, which was originally scheduled for May 2020 was postponed and we do not have a new date.
Nevertheless, it is important to point out that our 30 months day ends in October of this year.
Law and assuming we have our approval in <unk>, we could launch our product without a court decision.
We are evaluating this opportunity now.
The decision will be made based on our view of both non infringement and in the liddy of the patents both of which we believe we are in strong position.
Based on all of this we have confidence in the approval and confidence in the ultimate trial.
That said, we believe our launch time use potentially shifted from this year and name moved into early 21, the timing should be updated next month.
We continue to anticipate when the launch does occur we will maintain or hundred 80 days of exclusivity also I'll remind you that sales that agent base, a strict are expected to reach about $700 million this year.
Now, let me turn to our Ryanodex franchise as noted in our press release. This morning on Friday evening, we were notified <unk> either complete response letter for Ryanodex for Exertional heat stroke.
We have determined that we will no longer pursue this indication.
On our last earnings call, we indicated that where the last nine months. This year, we'd have to aggregate revenue ryanodex greater than all of 2019, even with the absence of the Exertional heat stroke indication.
It remains our expectation.
Importantly, we have a number of other potential exciting indications for ryanodex.
Regarding ryanodex for the treatment of brain damage secondary nerve agent exposed.
Yeah to finalize the special protocol assessment, or S.P.A., which will be submitted.
<unk>.
The review Curried is 45 days at which time, we hope to have a mutually agreed upon protocol.
We do we will then start to study and plan to file a new drug application in the first half.
We also continue to make progress on developing new indications and new formulations for ryanodex, including acute rat radiation syndrome, and we shed results of our study with Norse Northshore University health system before year end or traumatic brain injury.
In collaboration with the University of Pennsylvania for the treatment of Alzheimer's disease, which we refer to as EA 112, and we're developing an intra nasal formulation and we're also working money a white 11, and intra muscular formulation Brad decks.
As you can see there's a lot of work a lot of good work going on.
All of these can contribute to the accelerating diversification in earnings power of the company. The next several years, we're making steady progress across the board.
And all are supported by Eagle strong fundamentals were focused on the base oppressive much followed by the complexity.
All while moving full the strength and Ryanodex indications along.
I will provide significant growth, where the company even without the exertional heat stroke approval.
Let me pause here for a moment, thank dr. Adrian happened there who's on the call with us today.
You know Adrian is leaving the company and has done just they just great job for Eagle. His last day was about a week ago, but he will continue to consult with us for an extended period of time.
I'll turn the call over to Pete to discuss our second quarter financials Pete.
Thank you Scott.
Second quarter 2020, total revenue was $41.9 million compared to $56.7 million in Q2 2019.
Product sales during the second quarter decreased to $14.4 million compared to $29.4 million in Q2 2019.
Primarily due to a decrease of $11.3 million and product sales adult wrap so the decrease of $6.2 million in product sales up in Dhaka.
<unk> decreased sales were partially offset by an increase in ryanodex sales of $1.8 million to $4.7 million.
Perhaps or product sales were $4.1 billion into second quarter compared to $15.4 million in Q2 2019.
As a reminder, second quarter 2019 go wraps around reflected wholesaler stocking occasioned by the June 2019 cut over to the branded name.
Based on IMS data Eagles, marketshare abandoned must be in wholesale shipments to end users was 5% of the U.S. spend a multi market for the second quarter.
As we discussed in our Q1 results call. The cobot 19 pandemic in associated Lockdowns have resulted in a decrease in healthcare utilization broadly and specifically led to a reduction in the utilization of physician administered oncology products.
According to IMS data pull through of vendor must seem products is down approximately 10% compared to the theory it prior to mid March.
Additionally, several wholesalers have reduced inventory levels during this period.
As we've discussed in the past Eagle books revenue on ex factory sales to wholesales.
We have yet to see reversal in these trends, but continue to anticipate a normalization of boat usage and wholesale inventory levels as outbreaks abate.
We are encouraged by positive trends in the health care delivery broadly and we believed that the American health care system is well positioned today to provide patients with seep access to these lifesaving treatment.
Second quoted branded IX product sales were $4.7 million compared to $2.9 million in Q2 2019.
Well just for added extra cyclical driven primarily by product expertise.
Despite the challenges to our commercial efforts in accessing our current and potential customers precipitated by the covert 19 pandemic, particularly in the second quarter.
We continue to expect record sales for the product to the full year.
In the second quarter run instead of 30% marketshare of normalized dantrolene injection units.
Oh.
Q2, 2020 royalty revenue was $27.6 million compared to $27.3 million in the prior year quarter.
And that the royalties were $27.5 million compared to $26.5 million in the second quarter 2019.
Eagle continues to receive royalties from Teva at a 30% royalty rate following our amended license agreement.
On October 1st 2020, the rate will increase to 31% for 12 months and then rise again to 32% on October 1st 2021, where it will remain for the life of the product.
Gross margin was 69% during the second quarter 2020, as compared to 62% into second quarter 2019.
The expansion in gross margin in the second quarter 2020 was driven by an increase in Ryanodex sales lower bendeka product sales in the period to a marketing partner on which equal there is no profit.
And the increase in productive royalty revenue.
On the expense from R&D expenses were $7.1 million for the second quarter compared to $9 million into probably your quota.
The decrease primarily resulted from lower spending on visa press and partly offset by an increase in fulvestrant expense.
Excluding stock based compensation, another noncash or nonrecurring items R&D expense during the second quarter was $6 million.
As a result, but cobot related delays, we are lowering our 2020, R&D non-GAAP expense guidance to $40 million to $44 million.
Compared to $31 million in 2019.
The anticipated 2020 or do you spend includes number one E 114 pilot trial in CMC initiatives.
But to the rented ex trials for the treatment of nerve agent exposure in acute radiation syndrome.
Number three he want 11, I, Andy enabling toxicology studies and CMC scale up activities.
Before he 112 formulation development and additional preclinical work at the University of Pennsylvania in North Troy University Health system.
There were five regulatory advocacy for Ryanodex DHS.
Number six wants preparedness for visa precedent in Texas.
<unk> expense in the second quarter, 2020 increased to $18 million compared to $17.2 million in the second quarter 2019.
Increases and stock compensation expense, partially offset by decreases in TNT trade show cost and external legal expenses.
Excluding stock based compensation, another noncash or nonrecurring items second quarter 2020 S. You know expense was $12.2 million.
We are reiterating our 2020 guidance that as chenier expense on a non-GAAP basis will be $61 million to $64 million.
As compared to $56 million in 2019.
The year over year increases largely attributable to higher sales and marketing peril.
Partially offset by lower external legal.
Net loss for the second quarter was $256000 or two cents per basic and diluted share.
Compared to net income of $6.7 million were 49 cents per basic and 48 cents per diluted share in the prior year period.
Adjusted non-GAAP net income for the second quarter, 2020 was $8 million or 59 cents per basic and 57 cents per diluted share.
Paired to adjusted non-GAAP net income of $11.8 billion or 86 cents per basic and 84 cents per diluted share in the prior year quarter.
For a full reconciliation of non-GAAP net income to those comparable GAAP financial measures. Please see the tables at the end of our press release.
Our EBITDA for the second quarter, 2020 was $10.8 million compared to $15.5 billion in the prior year quarter.
First half 2020, EBITDA was $26 million compared to $34.3 million in the first half 2019th.
First half 2020 cash flow from operations, excluding shifts the receivables was $22.9 million compared to $42.4 million in the first half a 2019.
For the 12 months ended June 30, 2020, EBITDA was $40.7 million.
As of June 30, 2020, the company at $108.2 million in cash and cash equivalents and $46.8 million net accounts receivable.
$35.7 million of which was due from Teva.
The company had $37 million and outstanding debt.
Therefore as of June 30, 2020, the company had net cash plus receivables of $118 million.
In the second quarter 2020, we purchased $4 million of Eagles common stock as part of our $160 million share repurchase program.
From August 2016 through June 30, 2020, we have repurchased $176.9 million of our common stock.
With that I'll ask the operator to open up the call for questions.
And at this time.
If you would like to ask a question press star and one on your Touchtone phone Star and one on your Touchtone phone.
We'll go first to later Randall Stanicky with RBC capital markets. Please go ahead.
Great. Thanks, Scott you go into more detail on the complete response letter or what it was based on with respect to Ryanodex for Exertional heat stroke I'm, just trying to understand if there's any read through or not to any other indications and and then does that add it all to your urgency and thinking about.
Just a belt that that's the first question.
And then second question just talk about what you're planning to proposed F.D.A. for full this front in terms of study design or at least if you're not able to do that what would the anticipated timeline around clinical work looks like based on what you think would make the most sense. Thanks.
Thank you ran those so look on E H S.
For the remaining.
Indications that we have I don't believe that there's a a read through.
As it impacts these other indications that are in other divisions and used through different a indications the H S.
If I can somebody.
On the best I can there's just not enough.
Evidence to approve the indication probably due to the fact that we've still not been able to test in enough patients right I think a lot of it comes down to sample size and if we had been able to run.
Well controlled double blinded study.
With large numbers of patients may have worked out differently I think that's when it comes down to unfortunately.
As far as always Strand goes you know so look what can I say that looked to be clear you know, we do believe we have a product which may improve.
Outcomes.
We've now.
Dosed over 350 women at this point.
And we just received some more data this oh this past weekend.
So now we're going to go to F.D.A.
Plan.
To finalize the clinical programs that you're asking about the timing.
Once we have better understanding about what we need to do we have full agreement with the agency will come back to everybody with the details the real details of the opportunity and the next steps in the and the timing, but our intention is that our next study, which may or may not be the registration.
Study, we're working through that now.
Should start this year and so we're moving very aggressively to get that going I don't think we can give you exact timing yet randall we'd like to wait till we get back from this meeting Yep. Yeah, you really know what's going on at the details before we speculate we have had some dialogue with them.
On the topic. So we feel that we have a reasonable sense of how we need to progress, but let's go have that meeting come back and and really dig into the opportunity.
It sounds good hey, Scott on each us what what changed though I, presumably you had meetings with that you show them. The study work the number of patients. They said go ahead summit.
And then.
We got the CRL. So I mean, it will give us any more detail on and what happens and then just on the part of business development does that increase your thinking around business development relative to share repurchases. Yeah. So look I don't really know if I have more insight on to complete response Randall you know it's been going on for for four years I think.
I don't think there's a heck a lot more than I can say is that unfortunately, we just weren't able to get the patients and the type of study.
That was required I think that's really what it comes down to you know even going back to the high since last time, we're excited but was still 10 patients.
As it relates to business development.
Our view of it we you can see today, where.
Very you know.
Bullish on our vasopressin situation.
We launched vasopressin and then go into effect see you know that's it that's a significant increase in the earnings power and we'll probably last for you know several years and so we're excited about rolling into those two approvals reasonably soon and then the symbio it'll be over it looked at sometimes but that's all ROI.
T income coming in so that's quite a lot of.
Profit coming into the company that starts in a few months.
And then as you look at those which seem to have little bit more certitude be high him behind the brings a presence and bio techs eat and all that time, we're now working aggressively on oldest strengthen and nerve agents and have data reads coming down on traumatic brain injury.
I'm starting our study this year now on nerve agent and let's see what happens with pancreatic cancer product from SM 88 that deal that we did recently that data comes out next.
Next year, that's what we think is a really wonderful pipeline that drives you know really very nice earnings for many years to calm but look that's the great thing about having a balance sheet into cash that we had an earning money that we have we still have the capability of doing more I, bringing more.
Products and so we're looking pretty aggressively I know, we keep saying that I guess absent the time deal we haven't done a lot of.
D. not for lack of trying but we just haven't found the perfect opportunity maybe it doesn't have to be perfect. Maybe it needs to be very good, but we just don't feel pressure even with DHS situation. We just think the pipeline. So strong that we're very selective.
And so you know, we keep looking in and hopefully will.
The company bigger, we Wanna get bigger and more profitable quickly.
And you know we think we're doing that we think we're well underway.
Great. Thanks, Scott.
Thank you.
Well take our next question from Tim Lugo with William Blair. Please go ahead.
Hey, guys is a lot going on with Tim. Thanks for taking my question I was just wondering if you could shed a little more days I'll give us a little more color on the right. So question testing going on sounds like.
<unk> you were mentioning a more testing, but you still expects the well see impossible that they would approve it within sort of among the <unk> getting about.
So what kind of daughter, they fail well that and seconds.
So that you said, though the launch maybe push back to 2021 basis points or is that.
Sort of driven by the approval I mean, all the legal situation.
Yeah, Oh really very good question, let me make sure I cover everything if I don't you know.
Remind me at the end of the statements Omega, but.
To be to be clear, we expect to read too to respond.
The a questions in totality.
By the end of next month, and then there's a review time and we're not sure what that review time is going to be in how long, it's going to take them to respond and and that's why we indicated that.
It's potentially move from this year or too early next year, but as I said in my in my comments My prepared comments were very confident in getting this product approved.
The question of times, there's a little bit up in the air into testing that they've asked us to do as I tried to state in my prepared comments is that there's a lot of work being done on these polypeptides and they've asked us to do a lot of work around again, what's an old molecule in this first to file I guess, that's our obligation than everybody else behind.
This is gonna have to do this work is well, which for US is actually encouraging because we were willing to spend $25 million to get this product market I think that spend and all the time that we've taken is going to pay off and so though I can't speak exactly to the testing that you needed to do but we've done quite a bit of testing.
On the molecule quite a bit of testing in our products for the last two years that we've been at the F.D.A.. We're wrapping that up now I think we've had our final conversations with the FDA about what we need to do for the most part we're doing it it's almost complete will send it back to them and you know a wait to get the approval and figure out how to get to market.
Okay, great. Thanks, Yeah, let's clarify like I guess, one other quick question just the full stride and meeting with the idea is that in schedule.
It has not been schedule yet we're doing that now we just received some additional data back over the weekend yesterday, we were reviewing the data quite a bit and.
Ed sitar encouragement to now I think we have a really very nice package very detail nice opportunity to send tap D.A. meet with them in and plan Accordingly, and hopefully this next study.
Will start.
So very soon and we can get going and they'll be exciting for us to be able to have a call.
Or communicate with everyone more strategically in more details about what the plans are and why are our project seems to be so compelling to these women and thatll be an exciting day for all at the same thing to sit and talk about how we maybe able to treat these women hopefully better than they're being treated today.
Great.
Thanks.
[noise] pick our next question from David Amsellem with private Piper Sandler. Please go ahead.
Thanks, So just a couple of quick on so I don't I suspect you are you talked about it being no provable and that you felt good really good about you know your chances I guess my question here as we know what has changed here and you know can you speak more more granularity to the challenges so say.
With getting that approved that's number one and then number two congrats more specifics on you know your BD priority is I know you talked about earlier in the call, but you know maybe give us a sense of how you're thinking about it and also you know with that in mind also looking at just cyber Fivea twos or also and as a long client base. It starts. Thanks.
Hey, David Thank you very much Okay. I took note from your questions hopefully I'll address all of them if.
Okay. If I don't just to try and back in so first going to days, though press and I don't think anything's changed right as I tried to point out it's just a very complex.
Product.
To get approved there's a lot of work that needs to be done you know from our perspective. The type of company. We are the approval of days or press it looks and feels a lot more like an M.D.A. I vote by be too and it doesn't <unk>.
And clearly as I mentioned, we're not in a first cycle we've been in the.
You know we've been at F.D.A. over two years now and we continue to field questions and do additional testing and all of that is worked out great for us we have a lot of confidence in our product.
And our formulation, we have a lot of confidence and getting it approved we were just asked you know a handful of additional questions some of which required us to do some additional testing that testing will be.
Completed here very shortly and we will respond to this last handful of questions.
Your next month, and then we'll wait for that or approval coming out of the FDA, but we do feel confident that after the couple of years and all the money that we've spent and all the testing that we've done that we have a really good handle on it there was nothing in there that we weren't able to do our product as far as we know couldn't.
Hold up too and we're just wrapping it up and and we'll get the approval here.
Yeah.
So that's where we are we're confident that I don't think it is really changed other than the normal.
No the normal work that goes on in terms of.
D. You know, we're open minded David as I said and I keep stressing we want to get the product the company to be bigger and more profitable more diversified I will say when we talk about it inside the company and we look at it you know the company has clinical risk at this stage of our lives as opposed to.
Commercial risk right, because we're working through the FDA on days a precedent on nerve agents on all the strength and that's that maybe a no times doing that we do have you know a clear path on Penntex see because we have final approval just had final approval another.
Another product presentation, we're under license. So we know that's going to launch phase of Preston's I said, we feel rather confident in.
Bio getting their approval the best that we can tell in Japan that seems to be moving along rather well I think at the ended the day rather than take on more clinical risk I think we move to commercial risk and take on products that are about to get approved or products that are already on the market I think that would serve us well.
It's a mix up the type of risks we have in the company as we're moving forward and growing the company and getting bigger I believe that's the best way to look at it.
Hey, thanks.
Thanks, David.
As a reminder, at star and one for questions well go an extra Brandon Folkes with Cantor Fitzgerald. Please go ahead.
Hi, Thanks, taking my question and then apologies if some of these have been onset I'm just jumping between calls, but firstly I just wanted to follow on that they did pricing.
Yeah, I want to resubmit the data to the FDA he's it actually going to be a formalized review area. It again and it will walk would that be parried B and secondly, maybe just any color you can provide into what you're seeing in Colorado usage and the kind of in July and they lost more.
Had any update on the Ryanodex coveted program. Thank you.
Yes, so that was no. Let me take these in orders you had last do had co bid you had they'll wraps.
And we the first question related to the timing of days out and so the the.
The date Herve zone, how long it'll take the FDIC to approve is unclear at this point.
So we think it's going to happen sooner than later I don't think I can give you a lot more information about it. So we may be able to update that for you next month. So the plan is to get this data in have conversations with the FDA and I think we'll be able to pinpoint a little bit better when that product will be a ultimately approve.
And as I said.
Maybe we can give some some thought to it you know our articulation of it is you know potentially we won't launch this year.
And it looks like it's going likely into early next year and hopefully we're right about that and we'll be able to update you again.
In September.
As far as coded we have stopped working on that project I think we mentioned that.
Before we just feel that there's just too much going on and company right now as we move through everything else and to pick up more work that we need to do to ready ourselves to go into the clinic I think we'd rather push that off to the side and concentrate on all the things we've been speaking about today.
And as it turns to as it relates to bell wrap so what we're seeing maybe I can turn that over to you.
And then maybe David is as well, who can bring more color to that bill wraps the situation.
Sure Hi branded thanks for the question. This is Pete I as far as Bell wrap so they were three issues really a one was a tough year over year comparison as you know the second 29 team was the high watermark, thus far for they'll ramp so revenue.
Due in large part to some inventory stocking associated with the switch over to the brand name in that quarter.
Number two.
We had in the second quarter of 2021 of our wholesalers appears to have brought down the ending June inventory terms of weeks on hand to <unk> to a level that was unusually low.
And number three pull through in the market as you can see from the IMF State I'm sure you track. If one were to look at the period from Middle of March which is to say to.
General matter the timing of the commencement of the locked down from Middlemarch till now if one were to look at that period relative to the equivalent number weeks prior to middle March di Minimus team pull through is down.
About 10%, 11% so all of those three factors.
Conspired to impact our second quarter 2020 per rep. So revenue.
And we're hopeful that the latter too will normalize here is as we move through the third quarter.
Yes, yes, and Peter just this is David just add onto that basically as you know chemotherapy visit so dropped quite a bit right. So basically across you know in many many oncology products such as for.
And the busting that's for sure and we're starting to see returns to that right do you start to see people coming back it on a more regular basis. You know there are cases, where in the hot areas, where basically you know major institutions like Memorial Sloan Kettering, where essentially closed.
For chemotherapy business. So that was not that unusual so we kind of expected that as you know industry. This quarter, we expect that to rebound as well and then there was some downstream impact on as Pete said some of the wholesalers basically just stocking you know few weeks less supply rights, which impact which impact inventory levels and we hope that that starts to stabilize.
To that was all due basically not to anything specific to the brand, but just to basically covered related issues wholesalers needed to start to other things in their warehouses related to cover the took up physical space and also just the fact that you know there was some cash pressure put on the middle man.
Due to cover the base could they carry less but those are those should those should normalize. So we're very optimistic about the last six months. So your first rebel ramp so.
Great. Thank you very much have one follow if I may have started [laughter].
I don't think about your manufacturing scale up an ability to scale up pretty quickly after approval and launch the product should you know one should address or whether you successful in court. Thank you.
Yeah. Thanks, Brendan so we're very confident our ability to manufacturing supply. We don't think that's going to be a problem.
At all we have a lot of experience with manufacturing product we've been working on for quite a while again, so we have high confidence in our ability to manufacture meet demand and get that product to the market.
Alright, thank you.
Thank you.
It appears we have no further questions I'll return, the Florida, Scott care for any additional or closing remarks.
Thank you were really very excited about where we are right now.
Balances 2020 will continue to be very active for eagle as we build on a momentum at the past several months, we look forward to the near term launches, a vasopressin and FX c. and the royalty coming out of Symbio.
Well also continue is brought up in the call recently to seek out synergistic business development opportunities that's important to us therapeutics underdeveloped and have the potential to save it improve patient lives and served to complement our existing foundation of established products.
Why the pandemic has certainly changed landscape in many ways. We do you go to continue to focus on serving or shareholders as well as the patients who can benefit from our products have a great day, everyone. Thanks for taking the time really appreciate appreciate and look forward to speaking everybody again pretty soon thanks again bye now.
This will conclude todays program. Thanks for your participation you may now disconnect have a great day.
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