Q4 2020 ANI Pharmaceuticals Inc Earnings Call
[music].
Good morning, and welcome to today's program My name is Maria and I'll be your conference operator.
At this time I'd like to welcome everyone to and I Pharmaceuticals fourth quarter and year end 2020 earnings results and business update call.
All lines have been placed on mute to prevent any background noise.
After the Speakers' remarks, there will be a question and answer period.
At that time, if you have a question. Please press star and one on your Touchtone phone.
As a reminder, this conference call is being recorded today March 19 2021.
It's now my pleasure to turn the floor over to MS. Lisa Wilson Investor Relations for and I Pharmaceuticals. Please go ahead.
Thank you Maria and welcome to Eni Pharmaceuticals, Q4, 2020 earnings results call and this is Lisa Wilson of insight Communications Investor Relations for Eni.
With me on today's call are and the kilowatt and President and Chief Executive Officer.
And Steve Carey, Chief Financial Officer of Eni.
You can also access the webcast of this call through the investors section of the game and I website, and and I Pharmaceuticals Dot com.
Before we get started I would like to remind everyone that any statements made on today's conference call.
The express belief expectation projection forecast anticipation or intent.
Card and future events and the company's future performance may be considered forward looking statements as defined by the private Securities Litigation Reform Act.
These forward looking statements are based on information available to and a and I pharmaceuticals management as of today and.
And involve risks and uncertainties, including those noted in our press release issued this morning, and other filings with the SEC.
Such forward looking statements are not guarantees of future performance actual results may differ materially from those projected and the forward looking statements.
And I, specifically disclaims any intent or obligation to update these forward looking statements, except as required by law.
The archived webcast will be available for 30 days on our website and Eni Pharmaceuticals Dot com.
For the benefit of those who maybe listening to the replay or archived webcast. This call was held and recorded on March nine 2021.
Since then and I made of made announcements related to the topics discussed. So please reference the Companys. Most recent press releases and SEC filings and with that I'll turn the call over to Nick keel Wadhwani.
Thank you Lisa.
Good morning, everyone and thank you for joining our call.
I'm very pleased to be here to update you on our recent progress and to set forth for you My plan to drive sustainable growth for Eni.
This morning, we announced the acquisition of new video and pharma.
For the details and the value of this important transaction and a few minutes.
COVID-19 continues to impact just about every aspect of our personal and professional lives.
The impact continues to be felt throughout the pharmaceutical industry and our team has been focused on managing our business through these challenges.
I remain grateful and proud of the strong commitment shown by our team in conjunction with our customers suppliers and manufacturing partners to ensure that we continue to supply of medicines to patients and neat.
Our established brands business.
The greatest impact from the constraints imposed by the pandemic.
And our full year results reflect the significant debt seeing commencing in March of last year.
Steve will provide the full details of our financials, including 2021 guidance and a few moments.
As promised I will now take you through to my strategy to deliver sustainable future growth and create value for our shareholders, while most importantly, serving patients and neat.
During the past six months I have taken time to understand the evolving biopharma market dynamics potential market opportunities the.
The approaches developed by other players and N is current competitive position.
This has helped me crystalize, how to build Eni and to a successful and sustainable Biopharma company and to maximize value for current shareholders.
Let me now walk you through the four key pillars of our growth strategy.
Our top priority is building a successful core growth and franchise. Our goal is to submit as robust of package as possible. One that gives us the highest degree of confidence that it will be accepted and ultimately approved by the FDA.
For the past few months.
We are actively engaged with the FDA sort of define the regulatory path forward.
Accordingly, we have made refinements to walk we will submit.
Based on the refinements. We now believe we are well position for Resubmission and Q2 of 2020 one.
In addition, we have increased our manufacturing batch size to match our commercial aspirations.
Although this impacts of our time line by one quarter. We believe it will result, and a more comprehensive and robust re filing to ultimately support approval of court process.
In fact as part of the new video acquisition the courts Rofin Refiling approach.
Been diligence by of prominent regulatory firm.
Outside of the one that were currently using and other consultants and they had each given the pumps up to the individual sellers and ampersand capital partners.
To strengthen our commercialization efforts around CT for Olson, we recently brought on Chris months, as Chief commercial officer and head of rare diseases.
He has been tasked with leading the court for Olson commercial franchise, including our launch strategy and commercial plan.
He brings deep experience and the successful commercialization of rare diseases at both <unk> and Merck and.
And we look forward to his leadership and guidance of this important franchise.
The second pillar to our growth strategy is strengthening our generics business by enhancing development capabilities and enhancing increased focus on niche opportunities.
The acquisition of the video pharma announced this morning for $163 5 million is an important step toward.
Words, achieving this goal.
Let me share of some of the compelling reasons that led us to doing this transaction.
Of course, no video creates a sustainable generics growth engine with over 25 anticipated.
The product launches in 2021 and 2022.
Including products with competitive generic therapy designation.
Furthermore, the F. 'twenty, one and is on file with the FDA and more than 30 additional products under development.
And the leadership team has an excellent track record of execution and efficiency from filing to launch.
Importantly, the are currently advancing three five and five <unk> candidates in oncology and hypertension.
These products will enable us to build on the Eni is increasing focus on niche opportunities, including a paragraph for filed in 2020 and the anticipated filing of Injectables and does this year.
The transaction will also serve to expand our manufacturing footprint and enhance the scale of our CMO business.
And the video ads nine new customers to Eni is growing <unk> business.
The volume has a 50000 square foot facility.
For finished dose R&D and commercial manufacturing and packaging right here in New Jersey.
With a further 20000 feet square feet expansion plan.
The <unk> annual production capacity is approximately 2 billion units across tablets capsules liquid suspensions solutions all of this for oral suspensions controlled release and potent compounds.
The third component of our growth strategy is to maximize value within our established brands portfolio true.
Continued programmatic business development and use of innovative market access and go to market strategies.
The deal environment continues to provide good opportunities, which they and leverage our existing brand and infrastructure.
In addition, we have been adopting innovating innovative programs that expedite the resolution of prior ox issues and digital tools for engaging prescribers and reducing patient burden.
The fourth pillar of my growth strategy is to expand our <unk> business, leveraging our unique north American based manufacturing capabilities.
I just shared how the DVD and acquisition expands our customer base and enhance the scale and manufacturing capacity.
In addition, I believe we could leverage our fully contained high potency facility that can manufacture hormonal steroid and alkylate and products and bought it.
Our ambition will be delivered by our collaborative purposeful and empowered team members with high performance orientation.
Our strong internal talent pool complemented by targeted external hires will accelerate our growth.
Our recent hires of Chris months.
Or is upward and the vendor thing.
They all hit the ground running from day one.
Finally, we are taking steps to strengthen our capital structure with new credit facilities and the pipe.
Steve will share the details with you shortly the.
This capital structure further facilitates achievements of Eni's aspirations.
In summary.
We have a clear growth strategy and have already taken a major step towards that goal with the acquisition of the video.
And a clear plan.
Laid out for re filing the <unk> gel and Q2 of 2021.
With that I'll turn the call over to Steve to discuss our Q4 financials as well as provide guidance for 2020 one.
Steve.
Thank you Nicole and good morning, everyone and thank you for joining us on this exciting day and age.
And is evolving growth story.
Net revenues for the fourth quarter of 2020 were $57 3 million.
For US is 48 million and the fourth quarter of 2019, principally due to increases in sales of our generic products.
Sales of our generic products were $38 7 million during the fourth quarter.
And increase of 32, 7% as compared to the $29 1 million for the same period in 2019.
These debt.
The increase primarily reflects the January 2020 launches of Palo paradigm, and Big list that mixed amphetamine salts toll parodying paroxetine and other products acquired from the marriage and.
The January 2020 launch of potassium citrate E R and.
And the increased revenues of Kansas Star and.
These increases were tempered by decreases in revenues of the set of mobs and the stat and GAAP.
M <unk> and Methazolamide.
Net revenues for our branded products were $15 8 million during the fourth quarter.
And increase of 0.9% compared to the $15 6 million for the same period in 2019.
Primarily reflecting increased revenues of inderal L. A.
Which were tempered by a decrease in unit sales of <unk> XL.
Our cost of sales, excluding depreciation and amortization increased by $6 7 million to 24 point excuse me $24 5 million in the fourth quarter of 2020, primarily as a result of the increased volumes during the quarter.
Including a shift in product mix towards generic products and an increase in sales of products subject to profit sharing arrangements.
Coupled with fourth quarter 2020 inventory reserve charges.
The increases were partially tempered by the non recurrence of the fourth quarter 2019 inventory reserve charges related to our exit from the market of <unk>.
Methylphenidate extended release.
Cost of sales as a percentage of net revenues increased to 42, 9% during the fourth quarter of 2020 from 37, 1% during the same period and 2019, primarily due to the same factors previously discussed.
Research and development expenses decreased in the fourth quarter of 2020 to $3 $7 million compared to $4 7 million in the fourth quarter of 2019, primarily due to a decrease in expense related to the core trophy and the re commercialization project.
And the non recurrence of 2019 milestone expense related to Bretylium.
We recognized core truth, and prelaunch inventory charges of $3 million in the fourth quarter of 2020 compared to $6 5 million in the prior year quarter.
Adjusted non-GAAP EBITDA of $17 2 million was essentially flat as compared to last year down $200000.
As detailed on table four of this mornings press release, our adjusted non-GAAP diluted earnings per share is 80 cents for the quarter as compared to $1 and eight in the prior year period.
As of December 31, we had $7 9 million of unrestricted cash and cash equivalents.
Total net debt as of December 31.
The increased to 179 one.
$1 million as compared to 171 4 million as of the September 30th balance sheet.
This figure represents two seven times net leverage on the trailing 12 month basis.
As highlighted in this morning's press release and in the <unk> comments, we are very happy to announce our plans to acquire and the video and pharma.
Upon close of the transaction, we will pay day, one consideration of $163 5 million comprised.
Comprised of $89 5 million of cash and approximately 74 million and the equity to the selling shareholders.
The transaction is structured to contain additional contingent consideration of up to $46 5 million for a total potential transaction value of $210 million.
Of this amount of $25 million of the contingent consideration may be earned in the first 24 month period post close based upon the achievement of certain financial and SBA filing metrics.
In addition up to $21 5 million may be earned in the form of royalties on sales of certain fiber <unk> products anticipated to be launched in the future.
In conjunction with the transaction, we have secured committed financing and the form of the $340 million senior secured credit facility debt has been committed by true of securities.
This facility will be anchored by a $300 million syndicated term loan b and a $40 million revolver.
In addition, we have secured the $25 million pipe investment from Ampersand capital partners.
This pipe will be in the form of confer convertible preferred equity.
The transaction is subject to approval by Ani's shareholders and clearance by the Federal Trade Commission.
We currently expect the transaction to be completed in the second half of 2021.
Yeah.
In conjunction with todays announcements we of reinstituting annual guidance.
It is very important to note that the following guidance figures assume that total U S pharmaceutical prescription activity.
Team used to rebound to pre COVID-19 levels.
Any further COVID-19 related depression of physician and script activity will materially impact the company's ability to reach the following goals.
In addition, the following guidance figures assume the completion of core trophy and related R&D activities and the initiation of core truth and sales and marketing related activities.
These are key milestones as we progress towards our goal of bringing core trophy and to market.
With that said, we currently anticipate Eni Standalone net revenues for 2021 to be and the range of $207 million.
$218 million.
Adjusted non-GAAP EBITDA of between $60 million to $65 million.
And adjusted non-GAAP diluted earnings per share to be in the range of $3 and 30.
The $3.59 per diluted share.
For illustrative purposes only.
These figures on a non-GAAP pro forma basis, assuming a full year of forecast 2021, and the video performance would translate to approximately net revenues of between $277 million and 294 mill.
And again.
And adjusted non-GAAP EBITDA of between $85 million and $95 million.
With that I'd.
I'd like to turn back to the operator to now open the call for questions.
Operator, Please go ahead.
Thank you the floor is now open for questions. If you wish to ask a question at this time simply press Star then the number one on your telephone keypad and again that is star one.
If at any point. Your question has been answered and you wish to remove yourself from the queue press the pound key.
Our first question comes from line of Brandon Folkes of Cantor Fitzgerald.
Hi, Thanks for taking my questions and congratulations.
And the acquisition.
Maybe just two from me.
Any additional color you can provide and the earn out is this sort of across a broad swath of products you are acquiring and the.
Our acquiring and this acquisition or is it more heavily tied to one or two products and then secondly.
Now you bring in an R&D engine and I think that's the right thing to do so congratulations there, but how do we think about balancing the investment in R&D going forward with the need to invest in the commercial infrastructure for courtright and.
I assume it's too early but anything you can say about your assumptions around the investment required for could troponin commercial infrastructure would be great. Thank you.
No.
So Steve maybe I can start and you can jump in.
Sure thing.
Yeah. So.
Thank you Brandon and for your question.
The first one on the the earn outs, they're not related to one product. They are in fact related to the entire portfolio and.
And is <unk>.
And to do two things I think one is meant to recognize and reward.
The performance from the pipeline that is about one lockhart that is unlocking as we speak from the video.
And then second.
Our parts of the World very excited about when we talk about this R&D engine, we're really talking about the magic of <unk>.
Sami.
Chad.
D J and their teams.
And this is a way for them.
So again, the recognized and rewarded for continuing to perform as they joined the management team of Eni.
So that's what the.
The earn outs are for.
The second question of regarding investment and the R&D engine versus investment and core Carlson.
Look as you heard we are ready to re file and Q2.
We are we are.
Chris much onboard.
And he is refining the commercial gameplan.
And I think we will have a little more to share.
Our investments for quartz rofin.
As we go forward now having said that we have factored in.
Certain level of spend on.
Encore for Olson in the in the EBITDA guidance debt that Steve just share.
Yeah, and I would just I would just add to that Nick Hill, just the further unpack Brandon's question and good morning, Brendan. Thank you for the thoughtful questions.
In terms of.
R&D investment going forward.
Clearly the acquisition of.
The vd and pharma.
And building in a center of excellence.
And to fuel further growth for Eni Pharmaceuticals has been the strategic imperative for some time so clearly.
We're looking forward to continuing.
Continuing to invest in generic R&D.
With that said, we think on the other side of close of the video the.
The dollars that we're spending.
Are going to be more efficient.
The founders and principals and all of the employees of and the video.
And has been excellent.
And track record in terms of the efficiency of their R&D spend and we think the combination of the the video.
R&D excellence coupled with.
And is long standing track record and.
And the R&D excellence within our own four walls.
Is going to unlock.
The significant forward looking value and so we look we look forward to that day, where we can allocate R&D day.
Across our our two teams sort of I should say our combined team at that point in time. So that's one thing we think will unlock efficiencies there.
And secondly.
And the core trophy and.
The investment in SG&A.
I think.
We certainly view internally the.
The fact that we're starting to invest behind.
Key hires such and such as Chris.
And the start to invest behind the core Trophy and SG&A engine is clearly an important turning point.
It's always been a very difficult kind of decision internally as to when to turn on the taps to spend and the SG&A for core Trophy and it's something that the management team has talked a lot about as the core trophy and redevelopment program has.
And has continued on and so we feel very good internally that we're at a point where the.
And the management team can look at one another and.
And start to spend into SG&A with confidence around this program.
And then lastly, I would just highlight the.
Part of the financing for the <unk> transaction.
Well.
Getting the funding to two.
Do the transaction was for.
And center and job number one.
We do anticipate that there will be some.
And kind of side the benefits from moving to the term loan b market.
And that will allow.
It will be we would anticipate at this moment and it'll be a more covenant light.
The financing structure for us, which is important because to your question. The management team is balancing a lot of needs at the current moment.
And that I think of little bit more.
The term loan B structure will give the team a little bit more room to maneuver, while still continuing to be thoughtful about leverage ratios, which has always been and underpinning of the approach that eni so hopefully that helps.
Thinking about the of that was very helpful.
Our next question comes from the line of Elliot Wilbur of Raymond James.
Thanks, Good morning, and congratulations on the transaction I know that.
The establishment of internal product development capabilities. So it's been a long running goal of the company. So.
Congrats on finally, completing that piece of the puzzle.
I have a couple of questions with respect and the volume, but first I want to ask the question around <unk>.
For trophy and the revised time line.
I guess theres not a lot of surprise of the company at some point chose to meet with the FDA and advance of the filing but it seemed like that opportunity was on the table following the.
Refused to file.
The development last year. So I'm wondering what has changed with respect to prompting the company to sit down with the.
With the agency and then the thinking about the commercialization strategy behind the asset you recently brought in some new talent in terms of.
Leadership with the ex.
With the experience and the.
Brandon the rare disease area. The strategy originally behind core trophy and was more of a price strategy.
Lead with the aggressive discounting and the product what sort of show itself on the basis and I am wondering if that thinking maybe has changed or evolved now that you've had fresh eyes sort of take a look at the strategy.
Got it.
You for that question Elliot.
So.
And I guess I'll answer your questions on controls and first.
Regarding the meeting with the FDA.
Look.
When we got the refusal to file.
As we've explained in the past.
Pat had done this when he is the interim CEO.
We spend a lot of time for us just analyzing the file ourself.
And saying what could we have done and what we found and.
He brought in a strong external consultant for consultants to help us do a full GAAP analysis on the submission that we had done and what they found was there was a number of things that we could have done better and the file itself. So it's not just the points that were there in the.
<unk>.
S T a refusal to file letter, but it was also other gaps that day and identified.
And so what we and so at that point.
We restructured our internal team and.
And we started addressing those gaps.
Now when we start addressing those gaps we realized that there are a few questions that would be helpful to get FDA guidance on.
Before we file.
<unk>, rather than making assumptions.
The type B meeting with the FDA and.
And we've also had and.
The gauge with with the FDA since then.
Two to understand and refine our understanding of what will make me a robust package to submit.
Two of the FDA.
And Thats whats driving the you know.
The slight shift and timeline.
For the portal and Refiling.
So that was in terms of the meeting with the FDA.
The second question on commercialization.
Youre absolutely correct.
Our approach to recommit to commercialization of control flow will be holistic.
Market access and pricing will only be one component of the.
Of the commercialization approach and.
No debt.
Our competitors.
And competitor of Mallinckrodt.
And is likely.
And I'm trying to figure out what exactly we're doing.
And therefore, I would like to not get further.
Color on what our approaches, but you should be assured that the approach will be a more holistic approach rather than one of just.
And just price discounting.
Okay, and then wanted to ask a couple of questions around the the video transaction.
As well I guess just.
Simplistically.
We expect that business to contribute or to generate roughly 25, new launches and 'twenty 'twenty, one and 2022.
And they obviously have 21 andas pending so there's sort of already approved products that are going to be launched but how many of those pending 'twenty one and of.
Our embedded within the expectations for.
The 25 launches and.
And then a question on the EBITDA expectation for the second half I am assuming that suggest a sort of base <unk> number.
Obviously wouldn't have for the benefit of any potential cost savings of synergies from combining the two.
For the two companies.
I wanted to confirm that and can you give us a sense of.
Where they are currently in terms of EBITDA of what has to happen in terms of the approval cadence for that $15 million number too.
To happen and the.
Then one final question I know you mentioned that several members of the management team.
The <unk> are going to be joining.
And I know that management team is quite well regarded in the the industry. So I'm wondering what type of commitments you've been able to secure from them given they seem to have a.
Fairly significant residual stake and the Kevin and company I'm, assuming they will stay on board for some period, but of any color you could share there would be appreciated. Thanks.
Okay.
Okay.
Got it.
So Elliot let me start with your last question first which is on the commitment I think that our goal.
Has been with channel.
Chad and Sandy and DJ and the rest of the organization is to build a combined organization debt.
That will grow and price together.
And the leadership team of semi Chad DJ and the rest of the organization.
We believe that day will be with us for some.
Yours, and yours right and that's that's how we're thinking about the partnership.
As you correctly noted the day of significant.
Equity and Eni moving forward after of course the the.
The transaction closes.
As well as these earn.
And that is.
Sufficient incentive to keep them recognizing the awarded the.
The impact that the will have as much broader like Steve talked about our R&D center of excellence and we.
We have strong internal R&D development capability and this is going to strengthen that further and I think that the will work as one.
The development engine going forward, so I think thats to answer that question.
The second question you asked was.
Actually the first question you asked was about the the launches planned.
Look.
We're giving you indicative range of how many launches will come right as you are well aware.
Net.
We have and.
And of course this is the.
This is the team that has delivered time and time and again and so we sat with them and try to understand what is their expectations of launch timelines.
And also triggered the figured in there that there will be some movement, some puts and takes and thats factored into the.
Into the.
And the estimate share of 25 plus launches.
I think that this at this point, we will also step back and look and the overall portfolio and say with the <unk>.
Best in class R&D engine that we have.
What is the most value creating.
Portfolio.
To take forward of course, the filed and does.
We will make sure that those are launched.
And there are as you can.
As you as you heard that there is also as part of the earn out.
And earn out related to the filing of the Andas and that will also.
For the teams will work together.
And to finalize that plan.
And so that portfolio will evolve over time.
And then the your second question was is the R&D synergy right is the right Elliot.
Yes. It was it was trying to get a little bit more color on the second.
And second half EBITDA run rate expectation, so I am assuming that $15 million doesn't wouldn't include the possibility of and are there any synergies whether they be R&D spend or the elimination of some from G&A and I'm trying to figure out like what has to happen for that run rate two to materialize and the sense of new.
Launched and so I was wondering if you could give some color on kind of maybe where that business is now and.
And what sort of has to happen for it to get to that.
$30 million annualized run rate 15 million and the second half in terms of approvals.
Sure sure.
I'll start and then Keith can jump in.
This does not count on and this is the investment thesis behind this acquisition is not one.
For our cost synergy and so.
Steve and clarified it's about.
The building as you pointed out the complementary capability and enhancing the enhancing and strengthening the product development capability the day.
And I had at the strategic imperatives imperative for some period of time.
Now to your question on <unk>.
And what needs to happen.
I mean things are already in motion for them to achieve that run rate.
Last week, we got approval for full Phenazine tablet.
And as a.
And attractive market opportunities for the fourth entrant.
There is a other attractive launches that they have coming.
And the unlocking of those launches that will essentially.
Helped deliver the.
The $15 million H.
EBITDA.
And the $30 million run rate now the only caveat that I would add is we.
We don't want to be presumptuous about the.
The time, taking the secure.
FTC approval.
So those and that's why we've said each one.
For each two.
And also as you are aware of the this.
The equity that has been granted to the.
And the sellers, which is the volume.
Shareholders as well as for Ampersand capital partners.
The combination needs to be put to a shareholder vote.
And so and subject to those.
Of those approvals and.
And the timing of those.
Yeah, and Nick Hill, and Elliott and the one other point I think is worth mentioning right. If you think of.
So many acquisitions and merger activities and the world.
Many times in transactions I think more often than not right. The other party.
Is the big unknown right and a lot of times, you've news you have a lot of value leakage.
The post close.
Based on.
Cultural issues right I think in this case and another another strength of the steel and this combination is that both management teams of <unk>.
And I and the video are very confident around cultural alignment.
And clearly we have teams that.
Portions of our team the.
We're very aware of approach.
And in terms of both management styles and from that perspective, I think it's going to be quite a natural fit.
As we bring the two entities together and I think that that will just further strength and the combined teams the ability to deliver and the future.
As a reminder, ladies and gentlemen of English to ask the question simply press Star then the number of one on your telephone keypad again that of Star one.
Our next question comes from the line of Dana Flanders of Guggenheim.
Yes.
Great. Thank you very much for the the questions I had a.
A couple of and I'll just ask a per.
Front.
And so my first one is just with the acquisition Mckeel can you talk about kind of the expectations for the <unk>.
Number of and the filings that you expect to be able to file with the FDA going forward.
And you talked about focusing on niche opportunities are there particular kind of dosage forms that youre seeing kind of better opportunities.
Across the space and does that align with your capabilities and I know you mentioned.
Filing and injectable product some paragraph for opportunities just kind of curious how youre thinking about kind of the types of opportunities for cross generics.
Your capabilities now.
My second question was.
Was wondering if you could provide any more color on the 505 the twos.
That they haven't and the pipeline and if you expect that to be a bigger focus for your R&D engine going forward.
And then my last one I was hoping you could elaborate a little bit on the C. D. M. O strategy you are putting into place I know, what this acquisition, you're adding some new customers it.
It seems like they have and ongoing expansion.
At their facility.
The city of most space is obviously very attractive how much capacity are you, bringing on with this acquisition and talk about the strategy.
So we add new customers.
Going forward and just what that could look like for an IP. Thank you.
And thank you. Thank you for your questions let.
Let me take them one at the time.
So I think the first one of them and of filings.
I think that.
Look you know we will.
B and the range of 15 filings.
And we need to step back and look at the combined portfolio and say.
And what does what could that look like.
We are of very prolific team.
No video.
And that has execution and efficiency at.
And at the heart of what they do and we have the team at NII that is out of very successful track record of bringing high value products to market. So we will look at the combination and it's true.
To me, it's less about the.
The the number of files and more about the value.
And associated with the end of filings so I think.
But indicative I think you can take and the 15 plus.
The range for.
The number of filings the.
Second you said about niche areas.
Look.
You know.
Over the past year and before the new medium acquisition to the programmatic BD that we were doing we did.
Add some niche areas and we started adding more niche areas and there's a.
Basket of injectable Andas that we are for.
Pursuing through partners. So this is obviously not.
And our own facility.
And then we've also ventured and done and our first paragraph four filing in the the end of 2020. So we're trying to obviously the sort of space that I know well.
And we're trying to find more areas like that too to invest it.
And then on the final slide the twos.
The the.
The title of five Btu plant plan.
The debt no medium currently has in the area of oncology oncology and hypertension.
And you know.
And it's really around the capability around dosage forms and unmet.
Unmet medical needs and finding.
The opportunities of the intersection of that so there are multiple programs in progress currently.
And again.
Part of the improvement and capital structure is to allow ourselves to invest.
And more.
And behind these sorts of opportunities.
To go ahead and and.
And to expand our <unk> five <unk>.
The business. So I think that's how we're thinking about that and obviously you've seen that as part of the financing we have also broadened.
And on board.
<unk>.
Financial sponsor Ampersand capital.
And that was a there was a lot of part of what's behind that choice too.
So finally of your question on CDMA and <unk>.
I think there is.
There is tremendous opportunity not just the new medium, but also at our site in.
But there are two sides and for that as well as the site and Canada, we have tremendous capacity that can be leveraged to.
To grow the CDM business the.
Key is to find the balance of.
Of.
Finding the opportunities of CDMA and <unk> that are.
And that are attractive and sticky.
And Thats, what we will be focused on.
Did highlight in my remarks.
Third remarks the.
And the unique capability that we have also at our facility in and of hormonal and oncologic facility for that and that's something that we will leverage more as we.
Really.
And put effort behind and grow our <unk> business.
Thank you.
Our next question comes from the line of Elliot Wilbur of Raymond James.
Decided that the Steve hadn't had enough airtime as of yet.
And you just.
And if you've provided for your prepared commentary I apologize I missed it but just some commentary on the day.
The interest rate on the the new credit facility and then also the second.
Tranche of the the earn out structure tied to the 505 B twos I didn't catch the timeline associated with that I am not sure. If you provided or not I know the first part is within 24 months, but is there for a timeline sure.
With respect to the five of I'd be too and then.
And one question for follow up question for Nick as well so how do we think about the integration now of <unk>.
The video and its pipeline with the 90, plus andas that are in the Eni Library.
Just not sure of what the real opportunities there does the acquisition of Iridium.
And give you capabilities to monetize those at a quicker pace and you might have.
Otherwise just trying to think about sort of how.
The acquisition, maybe add some incremental value to those legacy assets.
Sure thing so I'll start off there.
So elliot and in terms of shifting to the term loan b structure.
I think it's important to note right. This is the the first time that.
We'll be taking Eni for you the rating agency process and through.
Of syndicated process on the debt side, so we look forward to.
Working with the leadership that true list on those those pathways.
And so I would say.
What I would say around this is for.
For our planning purposes at the moment and of course subject to change.
Based upon future events, but for planning purposes, we anticipate being.
Kind of in the the five and three quarter type area in terms of the all in all and interest rate on the term loan b.
In terms of the contingent consideration.
You are correct. The the first tranche that's tied to <unk>.
Financial performance and FDA filing metrics will be.
Measured in the 24 month period post close.
The second tranche of potential earn outs around the size of <unk>.
And our structured as a traditional royalty on those products. So the concept is.
And when the product launch.
There will be of royalty you did the crews back to the.
And the selling shareholders of Meridian.
And the have the ability to earn upwards are up to the 21 $5 million cash over time and and theirs.
And that that timeframe and Mccann extend out.
10 years.
Nicole I think the last leg of the question perhaps for you.
Yeah.
Thank you, Steve I think that.
It's interesting you brought that question of Elliott and the.
And the time that we.
We have been obviously.
Discussing the opportunities there.
And there have already been to at least two products from our basket of Goldman Andas debt.
Semi and team and the video.
I believe that they can get to the market much faster.
And that has already been put in motion and that's part of a and obviously.
A separate.
Of co development deal.
We will do but.
For sure that the.
The unlocking of the dormant andas and not all 90 and have not all of <unk> 90 of the same value of the.
Once that debt have market need and value add.
Accelerating that type of market is for sure part of the part of the plan.
And ladies and gentlemen, and we've reached the allotted time for questions I'd like to turn the floor back over to Nick on the <unk> for any additional for closing remarks.
Thank you Maria.
So look this is a very exciting and active time for Eni, we weathered the difficult year and believe that we are well positioned to take advantage of opportunities as the headwinds from COVID-19 begin to dissipate, we feel confident that we have establish a clear regulatory path forward for controls and our top.
The already we are thrilled to acquire in the video.
A well run company, where the portfolio that immediately gives us a established R&D engine.
And contributes to our EBITDA.
And we believe for the future is bright.
As always we appreciate your support.
As we accelerate our growth plans and bring high quality of medications for the patients who can benefit.
Thank you all for your time today.
Yeah.
Thank you ladies and gentlemen, this does conclude today's conference call you may now disconnect.
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