Q1 2021 BioDelivery Sciences International Inc Earnings Call
Greetings and welcome to buyout the Library Sciences first quarter, 2020 one earnings call. At this time, all participants are in a listen only mode.
The question and answer session will follow the formal presentation.
If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad. Please note. This conference is being recorded I would now like to turn the conference over to Terry <unk> Executive Vice President and Chief Financial Officer. Thank you you may begin.
Thank you and good morning, everyone.
Welcome to our first quarter 2021 earnings conference call.
Leading the call today is Jeff Bailey Chief Executive Officer, we are joined by Scott <unk>, President and Chief Commercial Officer.
Following our prepared remarks, we'll conduct the question and answer session.
Earlier today by of delivery Sciences, and issued a press release announcing its financial results for the first quarter of 2021.
Copy of the release can be found on the Investor Relations page of the company's website.
And my business remains healthy and well positioned as we manage through the pandemic.
I would like the focus your attention of three main takeaways from today's call and.
The first of all you take away our overall business remains solid and the first quarter with sales growing seven per cent, including BELBUCA T. R X volume growth of 8.9% year over year. Despite two challenges and notable challenge like other farm of companies of reporting COVID-19 is having a market and pack and Q1 with patient visits.
Being down across the the number of therapeutic areas. This includes a long acting opioid market the salt prescription volume declined 5.8 per cent compared to the queue for.
Furthermore, we saw one time disruptions to our business from the February Winter Storm here, the storm had both regional and national impact recently, and the South Central area.
Where we have a strong presence pharmacies and physician offices were closed for multiple days.
Specific the BDSI, we encounter and national impact as our Tennessee distribution facility was not able to ship product due to the storm for approximately two weeks.
We mentioned these headwinds previously and our 242020 Orange call. Despite these challenges are businesses performed well.
With weather related issues behind us has been encouraging to see an increase in the sales representatives based and faced calls with health care providers or H G p's as well and stronger prescription trends.
We're also seeing the highest weekly and B R X market shares on the other day basis and April along with and all time record high tier X market share and our <unk>.
Most recent Ah date of week Scott.
Scott will cover the some more detail and he's trying to give us confidence and of growth going forward. Additionally, we know that much of our lost revenue and Q1 was due to a weather related disruption to prescription fulfillment rather than decrease customer demand.
The second key takeaway our product portfolio remains strong and profitable as we continued to build our balance sheet any of the quarter was approximately $160 million and cash and the first quarter, we generated $9.2 million and EBITA within attracted of 22 per cent you have no margin.
Total prescriptions grew by 9200 year over year to over 112700 retail mail order and long term care tier access combined this represents a solid eight 9% increase and BELBUCA and <unk> as compared to the first quarter of 2020, and the slight sequential decline of five 1% compared.
For the fourth quarter of 2020.
The year over year growth from Q1, 2020 and was meaningful due to the challenging comparison to a pre COVID-19 market and January and February of 2020, and then and elevated level of prescriptions and March 2020, when physicians patients could stock up on their medications as stay at home orders were implemented.
The BELBUCA scripts grew year over year, despite the impact of the pandemic a continued decline and the overall long acting opioid market and the negative headwinds from winter storm Yuri as Jeff described.
Given the confluence of events. This quarter, we were pleased with BELBUCA continued revenue and script growth and it's stable Q1, <unk> market share of four 5%.
During the first quarter of BELBUCA is new to brand market share of six 7% declined by one 1% from seven 8% and the fourth quarter, but remained significantly above its trs share of four 5%.
Cool.
We believe that this program can continue to generate incremental growth and 2021.
We are pleased to report that BELBUCA prescriber base increased and the first quarter by six per cent year over year.
As mentioned the winter storm impact of some or most productive regional territory's.
Sequentially R. A prescriber base remains stable largely due to the impact of these territories, which represent approximately 21% of BELBUCA volume.
Our market access with BELBUCA has improved greatly overtime and has been important to our success.
Buke of currently enjoys strong commercial coverage with over 90% of lives cupboard.
Of which 60% are covered out of preferred level.
While and Medicare BELBUCA is covered and 33 per cent of lives.
We believe our current level of coverage provides a significant opportunity for growth, which is supported by our consistent year over year terex growth across all payer types.
We continue to be committed to improving access to BELBUCA, while balancing per coverage and rebate levels, especially and Medicare.
Some product Q1 prescriptions dip to approximately 16800 remaining flat year over year compared to Q1 2020 with of 10% sequentially sequential decline from Q4 of 2020.
The tomorrow market is historically weaker and the first quarter of each year, which is more of parents approached trends due to its growth since we acquired the brand and mid 2019.
The decline was magnified by the negative impact of winter storm here and the disruptions tour of distribution Center and February.
We are encouraged to see some product March T. R X count increased by over 1000 prescriptions or close to 21% from February.
We expect renewed growth and revenues and total prescriptions for some product is this new Rx share is consistently exceed the total Rx share since may 2019, when the when BDSI began act of promotion.
Like BELBUCA, some broke as well positioned with covered status for 89% of commercial lives with 60 per cent of preferred status, we believe or early 2020 market access winds with prime Therapeutics and C. B S will drive additional growth for the remainder of 2021.
The BDSI sales force is done of outstanding job pulling through these wins, we expect to reach new TX count and share highest throughout the year.
The commercial team and took a proactive approach the overcoming the challenges we faced and Q1.
Think from the release of certain sales returns reserves.
Dubuque and net sales and the first quarter of 2021, where $36.4 million and increase of nine per cent compared to $33.5 million and the first quarter of 2020.
And and increase of $800000 or two per cent compared to $35.6 million and the fourth quarter of 2020.
BELBUCA gross to net deductions improved and the first quarter as compared to the fourth quarter of 2020 as anticipated primarily due to typical decrease the scene for Medicare coverage GAAP as well as the lower medicate deductions.
Net sales for some pro week, and the first quarter of 2021 or $4.4 million, which reflects five per cent growth year over year, and 20 per cent sequential growth compared to the fourth quarter of 2020.
And pro across the net deductions improved and the first quarter due to the typical decrease the scene for Medicare coverage GAAP as well as the updates to of gross to net channel estimates.
Total gross margin for the first quarter was 86 per cent in line with the first quarter of 2020 and above the 80 per cent margin during the fourth quarter of 2020.
Total operating expenses and the first quarter of 2021 or $27.8 million compared to $26.7 million, and Q1, 2020 and $21.4 million and queue for 2020.
As expected the sequential increase and the first quarter is mainly attributed to plans marketing investments and our core brands, which are typically higher and the first half of the year as well as elevated legal fees of approximately $3 million and the quarter, primarily associated with the ongoing paragraph four litigation.
Yep net income for the first quarter was $5.2 million or five cents per share and line with the gap net income and the first quarter of 2020 and be low GAAP net income of $10.2 million or 10 cents per share and the fourth quarter of 2020.
EBITDA and Q1, 2021 was $9.2 million or 22 per cent of net sales compared with $7.8 million or 20 per cent of net sales and Q1, 2020 and $14.3 million and the fourth quarter of 2020.
Non-GAAP net income for the first quarter was $8.5 million or eight cents per share and reflects GAAP net income, excluding stock-based compensation and non-cash amortization of intangible assets as compared to non-GAAP net income of $8.3 million or eight cents per share and the first quarter of 2020, excluding the same items.
And the fourth quarter of 2020, and the company reported non-GAAP net income of $13.7 million or 13 cents per share.
The company has a strong balance sheet with cash and cash equivalents as of March 31st 2021 of $116.4 million as compared to $111.6 million a year and 2020.
Operating cash flow generation of $11.1 million and the first quarter was partially upset by $6.1 million used to repurchase shares and $300000 of fixed as the traditions, resulting and a net increase and cash on hand of $4.8 million.
Our share buyback program initiated and fourthquarter of 2020, and we of repurchased approximately 1.6 million shares through Q1 2021.
And an average price of $3.87.
The $6.3 million and share repurchases to date represents 25 per cent of the total authorized amount of $25 million.
This reflects the continued confidence of the board and the management team and the strength and value of our business.
The company will opportunistically utilize the share repurchase program weighing the benefits of doing so with business development initiatives.
We are reiterating our full year 2021 guidance and continue to expect net sales and 2021 for BELBUCA and the range of of $155 million to $165 million and.
And 2021 total company net revenue and the range of $170 million to $180 million.
As previously discussed these estimates incorporate the impact and Q1 from the winter storms.
We estimate are total operating expenses to be and the range of $115 million to $120 million and 2021 and.
As we continue to invest behind the growth of our brands and we expect EBITDA to be and the range of $40 million to $50 million and 2021.
We anticipate remaining operating.
Cash flow positive throughout the year.
And will now turn the call back to Jeff for some concluding remarks before we open up the call for Q&A Jeff.
I wanted to take a moment and thank our employees, who continue to perform strongly with face with the ongoing challenges of the pandemic and the unprecedented weather related conditions and some of our key regions of February despite.
Despite these challenges the team deliver solid results and the first quarter and we expect the build upon the momentum and you've experienced the first few weeks of the second quarter.
Moreover, you're looking forward to the increasing the interaction between our sales force and health care providers for the balance of 2021, especially in person.
With products, which make a difference and patience lodge and a strong balance sheet to get sort of select business development opportunities I believe media size wall position to drive shareholder value.
We will now take your questions operator.
And she would like to ask a question. Please press star one on your telephone keypad, a confirmation tell indicate your Linus and the question killed you May the press star too if you would like to remove your question from the queue.
And for a participant choosing speaker of equipment and may be necessary to pick up the handset before pressing the sarkies. Our first question is from brand and folks.
With Cantor Fitzgerald. Please proceed.
Hi, it's actually my questions and congratulations on the color of execution and.
Maybe just three from me I guess.
And <unk>, maybe just finished with the honor and heard about the of which and update but can you just remind us and you have the challenges and you should you be successful and elegant and anything else, we should be watching and.
And secondly, how do you think of off the urgency for business development at you know and the current stood obviously you're buying back sure of the business for three low and then maybe rack and that.
Do you have any change and you're thinking about investing and r&d's of what it is to just be commercial with the address that you're looking at who would you look at the stage. Thanks. Thank you.
The brand is job polka do and well and thanks for the questions first of all just the kind of a general of just perspective on the Elvidge and <unk> what too much has changed I think just reiterate the the fact that yeah. We have the three day bench trial. The took place and concluded on March the third relative.
The <unk> related to the paragraph work Pat and challenge.
And the <unk>.
While we were very very confident of the strength of our I P and we can't predicted the position of the court and one of the time you. The old of course the decision our hope as of the decision will be rendered.
Earlier, the later and the second half of the year, there's there's our perspective post trial briefs from the parties are do to the core Spike the day and the decision from the court will be expect the subsequent to the finally of those supposed to a trial brief so hold of it gives you. The perspective, that's that's what we know at this time and what not too much has changed brand of.
And so let me just pause there like the October what you needed an out of the joke.
Yeah, and maybe just.
Quickly at the stage would you say settlement completely off of the cable, we just to foreign and and secondly, Uhm can you just remind me if the <unk> or the company that also have <unk> have challenged the patterns of like the stage. Thank you.
So let me take a look at the all the colors on the cell the front yup kept all the time and on that but the it's it's one of where you're all settled the can get all of this happened is email the through a process anytime so which one were that's the yeah. The the case there. So there's nothing to be able to comment on relative to the the settlements.
And the only other get the challenges out there was a camera of coming from a different perspective, but that's the all that <expletive> on the on the legal front.
Great Bob <unk>.
Okay very good and then onto the urgency of of business development I, just your baby taken it the even just the little bit more abroad as far as the up to date, what we're doing business development is there and we've been complete and thorough diligence very important cross functional really good process and collaborations as far as you know big of sure <unk> well.
And it all the things that could make sense to of stroke business with all of this day and of course, so I'm really pleased to report that this is something that an awful lot of works going into a regular day to use every week and making sure. We keep her finger on the pulse when it comes to the business development and played through this as as you would expect at this point and <unk> make sure we have really just.
<unk> tastes here with the way the we're focusing on some things that we rejected quite a few assets at this point and continue to assess the number of what <unk> wanted to be interesting assets at this point.
And we can take a look at it just from the strategy standpoint on that front and that's one where you know it's really we have a tremendous commercial infrastructure and of course, where you came to to leverage that and it'll play that through all the way when you talk about some sort of just to say and looked at the dog really good process and really good pretense effort.
As far as looking at all the be the opportunities on the urgency of front you know, it's one where it's really about from a tiny standpoint, it's about the right deal with the right time that really brings shareholder value. We're gonna actually shareholder value. There's some things are really do you hope the essentially makes sense as far as the <unk> based on the open the.
The backbone of of our company with the the commercial footprints and making sure that at the appeal of all the right things would be of focusing on there, but you were going to make sure. We can tell you that the the.
Sure that there's some really thoughtful of judicious process of value of of the opportunities and he can just bring it back the shareholder value of so from the time you'd standpoint, you know <unk>, yeah, you're right. We've been doing the buyback, which you know could be configured of different the deal construction of the things like that to be helpful and that and of course, if we decided to to go that way but from.
The timing of standpoint, it's one where it's it's the right deal with the right time, and so I just wanted to make sure that the.
The assure you also that this is something that is front and center for the company top priority as far as the work that's going on it a lot of good works been going on on that and so let me just pause there before I get to you are the question the Brandon.
Yep you onto the <unk> that question and thank you very much.
Excellent Alright, and then on the are the front, yeah, let's something where it continues to be very much. The the mindset that you were company you bet. It really joke art and later day City of later stage are are you.
Product you of something more like a phase three type of a product or currently commercialize that's kind of our sweet spot based on all of the company. So as far as anything early stage brand and that's not something that's at the top of the list of <unk> went out completely but we're not and a deep or or the organization. So I think that sort of just important to <unk>.
It out and so <unk> and nothing's really changed from that perspective, what we share the past and that and but just one where you really want the looking for the right assets. It really fits the perspective of that I described before.
Alright. Thank you so much I appreciate the comprehensive off of it.
Alright friend of thank you.
Our next question is from Greg Gilbert with true. It's please proceed.
Good morning, and I have a couple of <unk>.
Scott first with you it looks like we're seeing a slowdown and the decline rate for long acting opioids. Overall do you think that's a real trend or is it premature to call and given the sort of weird comps and the market's over the past year.
Gregory the I appreciate the question Yeah, we actually the last year I would've slowed down and started and slot and we had modeled that actually we have started the C. For example, you of and the M. B R axes were really stabilize which tend to drive some of the tier axes and it does appear of that the market's come back.
If you look at how it outperformed early and Q1 I think it was on our initial comments, but there was quite of fall off and now we've seen the bounce back and and March and April you know one of the things. We think the drove that was patient and does it when you look at I T V of that around patient visits there was a sharp.
Decline and early early 2021 actually blow probably blow any other any other time periods of COVID-19 as far as face-to-face visit.
So we're starting to see that kind of damp and and and come back a little bit. So yeah. We we do believe it the rest of the year, we should start see them face to face visit the increase and also as we.
<unk> as far as the individually as as we are able to get and in front of more doctors with the right reach and frequency, we should see a scrip try and start turning around the fall.
Have there been any access wins or changes of note for your portfolio since the last quarter.
No nothing of nothing substantial or meaningful the to report this time still ongoing conversations as always.
Got it.
And then maybe for Jeff and Terry on capital allocation of the stocks well below where you had been buying it is it a no brainer to keep buying it at these levels or is it more important to keep powder dry to sort of diversify the portfolio and is that realistic and the light in light of legal uncertainty.
Right the.
Is that uncertainty of.
Does that uncertainty prevent you from even transacting. If you wanted to right now I have the multipart capital of location question. So what are your thoughts.
Yeah, Hey, Greg so thanks for that yeah. It's it's an important question and when the that I and just spend a lot of time and and it's really important for us to be considering and weighing those exactly the variables that you're talking about in terms of the of the share buy back and as you might imagine when where and.
Quiet periods, we you know the only way the buying can happen is through kind of of Tenby. Five plan. So you know I think you'll you'll be able to see whether it's gonna send you the or not but we are weighing it with the business development and we want to make sure that we can balance and I do I do feel free.
The confident that given and I guess the credibility of the that I feel we've established and and our performance over the last couple of years that will have access to.
Uhm, the financial markets and or a variety of scenarios, if if and when you know the time is is right. So we are looking at that I think the you know while the trial is certainly something that's out there that wouldn't preclude us from being able to proceed on certain types of transactions before then.
And maybe I can just wrap up with the Ah legal questions for Jackson's and I like talking about litigation and predicting outcomes, so much but [laughter], perhaps and the last week.
Helpful Factual way. So if you go to the mat and and get a decision and and win against.
The first Challenger for example, can you help us understand to what degree that.
Affects the odds or does not as it relates to the chemo challenge just so people understand and the relevance of decision one and how it could affect.
Eventual decision number two should should you play it all out thanks yeah.
South diet sprite for the question the chemo elected not to contest the validity of the patterns at the at the March trial without the Chin instead, what kind of of did was they agreed to the bound by the court's decision from the Alabama and trial considerate of the validity of the three orange patterns. The all the chemo front. There's this sort of stuff, we just don't know the.
It is you've made of picked up on the the the F. D is not reported camera was happy and attended of a pool of force generic of beautiful film product. So yep.
And that's that's what we have the reported the at this point as far as the perspective on on both trials.
Thanks, a lot of appreciate it folks okay.
Great. Thank you.
Our next question is from David Amazon with the pay per Sandler. Please proceed.
Hey, everyone. This is back on for David Thanks for taking my questions apologies, if I Miss some of this color, but I was just hoping to get a little bit more insight into the the pace of recovery for what BELBUCA as 21 progressive and the normalization So I guess.
And other words, just to what extent will of return to of physicians offices and pack prescriptions and your view of given that there'll be with the generally has been fairly rest of the lamp. Thanks.
She got the you Wanna go first and gave you also a flop and is where all the please go ahead and Scott Yeah. Yeah. Thanks, I appreciate it so I kind of mentioned earlier, the the face to face visits, which <unk>, which review of critical so patients actually going into offices, because a lot of times and the opioid space.
They will not make of change unless I see the the patient so that could be either adding our product to it or or switching.
So again early in the quarter, we saw a decline and face to face visit actually the pain space and rheumatology when you'll get the that are pretty line, but they're the probably the ones that were hit the hardest early and 2021.
And and stabilize now and it's coming back and again and it was it was probably 10 points left plus the visits and there were as we exited the 20th 20. So I think we're encourage that will see that go back obviously a lot of things are opening up here and the United States now and and can we do feel that that's gonna be the key try and for US The thing I think we're we're.
Encouraged by though is.
Our actual ability to get in front of H C PS and have a meaningful conversation.
So when we look at our daughter, we opened up our sales force last July and we saw the steady increase and the ability to have face to face interactions with our with our hcp's.
And that kind of pizza of October then we hit the holiday period January of November December January and February the short month, we also have some weather and there and and national sales meeting. So it kind of dropped down again, but then March we we reached kind of and all time high for are the amount of the <unk>.
Time, we've been in front of a C. PS really sounds pretty COVID-19 and that was the 25 per cent of dropped jump over October even so where are the pharmacy and our numbers now where in recent weeks our shares up to 4.7 per cent, but we did 4.5 and Q for the N B a X chairs also rebounded.
7.5 per cent of the last four weeks. So we're already starting to see that recovery and even more granular as we look at some of our pharmacy demand. The you know isn't publicly available we can start to see some trends coming back there as well and so we're we're very encouraged and feel like the rest of the year, we can get back to some more of our historical growth rates.
It's <unk> if I could just go ahead and build on the Scots comment there that the make is really important of your question is a really important one from the standpoint of what's the the the overall market dynamic. We have here is that we're we're really the only <unk> scheduled to this actively promote even and the market and this one where that's just a great the situation for us during the pandemic.
As you can imagine with face to face being down that's something that you're Dennis Mark of it just mark of dynamic. It's one of where we really have a big bed. The placed on our sales force that those face to face interactions you need everything to us and the only thing the doesn't change about this business is one where the fundamentals of this business, which is the right.
Doctor of the right prescriber, the right message the right frequency right Doctor right message right frequency that doesn't change and so that frequencies the missing during the pandemic and also the storm didn't help and and the first quarter as well. So we're similar to what's the message by some other form of companies, but I just also one where like it as the we're hoping that the us thanks for coming out of.
Of the pandemic here, that's what we're seeing the trend now that's a patient and maybe get it back and the offices or are we looked at the I Q of of your date of that Scott was reference the before and that was one where that was very helpful to see if there's a trend back with patients getting back in the office, but also we're seeing are face to face call activities I'll wait up and in March and the into April here S U.
<unk> share and keep growing it.
We've we've we have pulsed and the different digital marketing.
Marketing that we hadn't done before with some pro X and in recent months. So we believe that we'll get back on track here shortly.
Part of it was some market dynamics and payer dynamics that we typically see in the space.
Okay, great. Thanks, so much.
Thanks, Ed.
Our next question is from Scott Henry with Roth Capital. Please proceed.
Thank you and good morning, just a couple of questions. The first one.
When I look at our reported revenues and total prescriptions for the quarter.
Obviously, you can back out revenue per script.
And the past couple of years, we've seen revenue per script.
And very strong and Q1 and then.
Perhaps coming off that a little bit the rest of the year, which is somewhat counterintuitive I would I would expect revenue per script to be lower in Q1 because of the reset I I guess the the question is do you expect that trend to continue this year, where revenue per script is highest in the first quarter and.
And and as well why do you think we're seeing that trend.
Yeah, maybe I'll jump in first Scott good morning, So actually and is what we would expect we typically see that the of the coverage gaps does have a Medicare temperature GAAP does have an impact for us and it is quite low and the first quarter and and it does the increase as the year goes.
And as people start to hit their deductibles and so on and so and.
In fact, it is the trend, but I would expect the the question Thats should increase of the year proceeds.
Okay. So you would you would expect revenue per script not gross to net to decline sequentially quarterly through the year.
And to make sure am I correct, yes, okay.
All other things being equal yes.
No other movement, but yes.
Okay, Scott the only other movement, the kind of counter is out of little bit the it.
It doesn't use the way it is just the blend of strength and stuff over time, sometimes can S.
As of patients, we see are higher strength as being a bigger percentage of our scripts. So.
Sure you're spot on on the gross to net side of things.
Okay excellent and I were there any price increases and the quarter.
Yeah, we are well and they'll go through and we took the price increase January force.
Okay and.
One of them out.
I per cent.
Thank you.
And then just the final question Uh Huh.
Terry.
The legal fees of about $3 million and first quarter should we expect a similar number and second quarter or you know higher or lower and then should we.
Assuming we get a get a conclusion when should we expect that to the decline in the second half of the year.
Yeah. So so the $3 million was the increase over the prior quarter and just to clarify that kind of and and I wouldn't expect it to continue to increase by any means we have as Michelle before submitted the or the breach there being submitted as we speak and.
You know hopefully the the costs would taper down as the year goes on.
Okay, great. Thank you for taking the questions.
Yep. Thank you.
Our next question is from Tim Lugo with William Blair. Please proceed.
Hey, guys. This is mark on them again, and thanks for taking the questions. I was wondering if you and it sounds of the new start programs.
The impact of the weather this year, obviously share that you've got a pretty true.
Concentration in some regions of the countries. There is the new start program.
I guess of that focused on and the regions, where you already have the.
The strong presence or.
And to use that.
Geographically or.
Yeah.
The little lots of and it's a little bit hard to to hear you you were cutting out but I think that was the question for Scott that was about the first start program and whether we are selectively using it and and regions and so on and is that right.
Yeah, Yeah yeah.
He says I think I I think I picked up most of it.
So lots of and what I would say the sort of the <unk> start program, we actually well the national level. We are pilot of it in the middle of last year, and then went completely national.
And I'm kind of mid Q4.
And on your telephone keypad, if you would like to ask the question. Our next question is from Tim Chiang with Northland Securities. Please proceed.
Hi, Thanks.
Scott and I have a question for you on sort of.
And how marketing for BELBUCA and some product will change once we get to the other side of the pandemic.
And anecdotally from some physicians like and.
And the state of Florida for instance that during the pandemic.
It was a lot easier to actually prescribe opioids.
The patients Couldnt come into the Doctor's office.
The state of Florida basically.
The.
They basically changed the rules so that they could get opioids without the patients could actually get the opioids and then sort of wondering when windows state rules revert back.
The bill could benefit largely because of the schedule the schedule III product I just wanted to get your thoughts on that.
And I appreciate the question.
Yes, they did they did change some some of the.
The regulations around how they can be prescribed.
And and light and them up somewhat for patients again to increase access because it could be more difficult during this time and.
And honestly.
I mean, it's always been fairly easy to prescribe.
Convenience of prescribed BELBUCA as a reminder, you can right refills for it we've always been able to call it and things.
Things like that so for us that that won't change I am not sure how long they're going to those.
Those regulations will persist the Tim we really haven't heard any about any changes upcoming or reverting back to anything anytime soon so.
So we haven't modeled anything around that.
I think anything that differentiates us it's helpful I think going forward.
Okay. Thanks for the commentary and Jeff obviously.
Waiting for this.
The decision on the legal front.
Is there any way to sort of handicap or sort of put bookends on what the impact of.
Let's just say.
And the worst case scenario you get a negative of decision I mean have you already started the prepare for do you have a contingency plan setup and.
And that scenario and.
Even if it is a negative decision I would imagine you'd appeal it.
Wanted to get your thoughts on that.
Yes.
Yes, so just to reiterate that we feel strongly about our case.
And that we've laid out there and just like any.
The leadership team and our.
And the responsibility to really be great stewards of the business, you're thinking of things from all different angles. So we think about from all different angles, but just to reiterate that we feel strongly about our case and.
And where that stands.
The whole base of the question. It is one where the just like the always looking for whatever the topic is within our our world as far as making sure. We're ready for all different types of scenarios that would play at the Russo.
Just want assure you that we're on top of our game looking at all different sorts of BD options options that fit under different scenarios and everything like that so hopefully that answers your question Tim.
Yes, no that helps and and.
Obviously, you guys are and a pretty good financial position right. So you kind of I guess.
Yes.
Youre going to wait for the court decision, obviously before you make any sort of BD decisions.
Is that sort of how you guys are thinking about it.
But naturally and there is that the.
There is a link between outcome trial, and and certain speedy approaches, but not all of it so.
It's one where.
You read between the lines there thats how.
The granular we are as far as Oh.
And when it comes to our BD work and the way that we're thinking about the world and that and so it's.
There is number of different approaches that feed through but.
There is a link with the certain BD approaches, but the but not all BD approaches tied to.
Type of the trial.
Yeah.
Okay, great. Thanks, so much.
Thank you Jim.
It's the.
We have reached the end of our question and answer session I would like to turn the conference back over to management for closing remarks.
Thank you Sherry as far as just to reiterate as far as we're really proud of.
The effort of our team our employees here and the first quarter.
Some of the dynamics of the first quarter, but really the business on solid footing really we're very fortunate we have differentiated products. The play out in the marketplace and you can tell from our look forward.
We're feeling really good about the.
Just the guidance and the world is in front of us, but it comes back to just really good operational excellence and executing day in and day out and really that's the mantra of our team and our focus.
Really to execute really well and truly deliver here in 2021, and so at that point very much want to.
Thank you everybody for participating today and.
And look forward to speaking to you soon.
Thank you. This does conclude today's conference you may disconnect your lines at this time and thank.
And for your participation.
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