Q1 2021 Acorda Therapeutics Inc Earnings Call
Okay.
Welcome to our quarter Therapeutics first quarter 2021 financial and business update at this time all participants are in a listen only mode. There will be a question and answer session to follow please be advised that this call is being recorded at the company's request I went on.
I'll introduce introduce your host for today's call <unk> Executive Vice President Corporate Communications at Dakota. Please go ahead.
Thanks, Bob Good afternoon, everyone.
Before we begin let me remind you that our presentation will contain forward looking statements detailed disclosures can be found in our SEC filings, which are public and the inc.
Origin referred to those bonds and I will now pass the call over to our CEO Ron Cohen.
Thanks, Tony welcome everyone.
Starting with Enbridge on net revenue for the first quarter of 2021 was $5 million Thats, a 13% increase over the first quarter of 2020.
We're pleased to see this increase despite the significant impact of the pandemic on the <unk> launch.
As we've discussed previously the first quarter historically has been lower than the preceding fourth quarter and the lowest sales quarter of the year due to a number of seasonal factors and as we expected sales increased markedly in March and April into May of 2021.
One relative to January and February.
And Peter on net revenue for the first quarter was $23 million. That's about the same as in Q1 2020. That's the first time, we've seen stable yearly quarter over quarter net sales since <unk> went generic in September two.
2018, we believe that that is due to the strategies that we've executed to maintain the brand.
Strength would be on PURA <unk> brand is an important contributor to our quarters financial stability and to our goal of becoming cash flow neutral on a run rate basis by the end of 2022.
Moving to accelerating and breezes trajectory.
As a reminder, embrasure is inhaled levodopa, it's indicated to address the return of symptoms or off periods that many people with Parkinson's experience in between doses of their regularly scheduled medications.
Despite the continuing impact of the COVID-19 pandemic, we saw encouraging signs of growth and enbridge are compared to the first quarter of 2020 as I mentioned, we saw a 13% year over year increase in net sales we saw a 5% increase in total prescript.
<unk> and very importantly, a 25% increase in organic growth over Q1, 2020 organic growth as measured by dispensed cartons, which most accurately reflect demand. This 25% increase represents an acceleration of the approximately <unk> <unk>.
17% organic growth that we saw between Q4 2020 over Q4 2019 I'm sorry.
That's right Q4, 2020 over Q4 2019.
I'm going to discuss this in more depth on the next slide.
Recall that Enbridge is in as needed therapy and patients can take it up to a maximum of five times per day, but they're not required to take it if they don't feel that their off periods require it.
Overall, 44% of all embrasure patients are regular users and that's defined as taking an average of at least one dose a day, obviously all the way up to five but on average of at least one dose a day and importantly of those regular users 70.
Percent are still on therapy a year later.
We've also been pleased to see that the average consumption for regular users is two eight doses per day up from $2 five doses in April of 2020.
In addition to the importance of maintaining these regular users. We're also focused on growing the brand by bringing new patients to therapy and converting them to regular users, which I'll discuss on.
Next slide.
We believe that the work we've done since 2020 to increase access to embrasure and to improve patient and physician journeys have positioned the brand for growth in 2021 and beyond as the pandemic subsides.
The conversion of written to filled prescriptions increased from about 50% to about 67% in 2020. We believe this resulted from improved access to the medication for both commercially insured on Medicare patients for commercially insured patients.
96% now have formulary access to embryo without need for medical exception and for Medicare patients, 85% have access with no block for these patients may require an additional submission by their physicians for a medical exception, but they are then able to obtain and Brigitte.
Yes.
We also moved to a single specialty pharmacy in the fourth quarter that streamlined and unified the experience that patients and health care professionals have with our customer service hub and the specialty pharmacy and it also reduced our costs.
As I mentioned in the previous slide in 2020, we improved our training materials to help patients have a better inhalation experience with embrasure and we also added nurse educators to work individually with patients to help train them both by phone and video we have received.
Universally positive feedback about these initiatives from both prescribers and patients and our data support the effectiveness of these enhancements. So the nurse educators alone have increased our first refill rate by about 20%.
And in 2020, we also reached out to patients who had either not filled or not refilled very embrasure prescriptions and we provided them with the updated training materials and or telephone or video training.
That resulted in about 250 patients returning to therapy to date.
So we take those as excellent signs that the improvements the enhancements that we added in 2020 are having a real impact and we expect that they will continue to.
Despite the pandemic about 550, new physicians wrote prescriptions for <unk> in 2020 healthcare professionals continue to express enthusiasm for embrasure and they tell us they expect to increase their rate of prescribing as patients return to in person office visits.
And also as they return to their previous levels of activity and therefore feel increasing need to address their off periods. So as the pandemic subsides. We expect these factors to increasingly come into play.
Our field sales team returned to making calls in person this past March and together with the impact of COVID-19 vaccinations in the receding impact that pandemic, we have seen progressive increases in new prescriptions in March and April continuing into May of this year versus what we saw.
On January and February.
Moving to <unk>.
Okay.
We were very pleased to see stable net sales in Q1 2021 compared to Q1 2020. That's the first time that this has happened since <unk> went generic in September 2018. In addition, approximately 150, new doctors wrote prescriptions for branded AD.
In 2020, and 2021 excuse me in 2020 and in 2021, we've actually seen progressive month over month increases in new prescription forms from January through April.
So we believe that performance is due to a variety of factors first physician and patient brand loyalty, we continue to hear from both health care professionals and patients.
Who value the support that we've always provided and are continuing to provide for branded appear on this includes our first step program that provides the initial two months of Empire are free to commercially insured patients co pay mitigation for commercially insured patients and physician and reimbursement.
Support <unk>.
And our field sales team continues to call on EMS specialist, where they have maintained outstanding relationships.
So moving to our financials and goals for 2021.
We're prioritizing the calibration of our Opex to our revenue and our goal is to be cash flow neutral on a run rate basis by the end of 2022 key elements of this are as follows first the durability of the on Terra brands.
Yes.
And the growth of embrasure as the pandemic subsides.
We're also engaged in substantive discussions now with multiple parties to enter into commercialization agreements for <unk> ex U S. These conversations have been revitalized by the sale of our manufacturing operations to Cadillac, which significantly reduce the cost of goods for embrasure.
As well as by the favorable decision by the GBA in Germany that an early benefit assessment would not be required.
Based on the current sales trajectory. We also believe that the double digit tiered royalties on net sales for <unk>, which biogen commercialized as ex U S will return to a quarter in 2022.
In addition, the lease on our Ardsley headquarters is currently approximately $8 million per year and based on excess capacity at the facility and our increasing focus on our hybrid model of work from home and an office. We believe that we can recognize significant savings by making our off.
<unk> presence more efficient.
<unk>.
We will continue to maintain our focus on fiscal discipline and reduced spending wherever possible without impacting the embryo launch.
So moving to our Q1 financial summary in addition to the embryo and appear on net revenue, which I discussed previously R&D and SG&A costs decreased by 39% and about 17% respectively compared to the same key.
Water in 2020.
Reductions in spending are due to the cost reduction initiatives that we implemented and our continuing focus on reductions in non core spending and note that Q1 contained significant one time expenses that we do not expect to recur during the remainder of the year. These included costs related.
For the Catlin transaction severance payments related to our restructuring and incentive compensation.
Our GAAP loss for the quarter was higher compared to Q1 2020 and that was due primarily to a $26 $5 million derivative gain that was reported in Q1 2020, non-GAAP net loss for the quarter was for 5% lower compared to Q1 2020.
We ended the quarter with over $148 million on cash cash equivalents shortened term investments and restricted cash and this represents an approximately 18% increase compared to the same quarter in 2020 due primarily to the net cash received from the Catlin transaction in February of this year.
So.
As we noted on our Q1 call we achieved all the goals we set for the company in 2020 to position a quarter to build long term value and moving forward, we're focusing on the key factors you see here first.
<unk> to drive <unk> commercial growth.
As I noted earlier, we validated the training initiatives that we dealt developed in 2020 by the substantial increases we saw in both filled prescriptions and return of patients to embrasure. In addition, our field team has returned to in person meetings with prescribers and we believe that this will also provide a significant.
Opportunity to accelerate adoption of <unk> and while it's still early to project. We are very pleased to have seen prescriptions increase.
Increase new prescriptions increase in March and April into May, which we believe is related to both the field for us and to the receiving of the pandemic.
The sale of our manufacturing operations to catalyst has significantly lowered the cost of goods for embrasure and as I indicated this is reinvigorated our discussions for ex U S partnerships and the recent favorable decision by the GBA in Germany not to require a benefit assessment has sparked additional interim.
By potential partners for Germany, which is Europe's largest market.
We're also continuing to support the on pure franchise as we've discussed that remains a significant contributor to our quarter's revenue and Q1 'twenty one Q.
Q1, 2021 sales were about equal to Q1 2020 net sales we've been pleased to see the durability of the product to date, we're on track to achieve our 2021 net sales goal of between $75 million to $85 million.
We'll also maintain our fiscal discipline, we expect to receive a tax credit from the cares Act this year totaling approximately $5 million to $7 million and we also plan to address the $69 million convertible debt payment. That's due in June of this year.
Finally, we're also seeking to build on the ARCUS technology platform. That's now been validated by the approval of <unk>.
A breach in the U S and.
The EU as well as by funding from the Gates Foundation for developing a pediatric inhaled surfactant product.
We're also seeking collaborations with other companies for additional potential indications for <unk>.
So that concludes my formal presentation and we'll now open the call for your questions.
As a reminder, I would like to remind you. If you would like to ask a question. Please press Star then the number one on your telephone keypad again to ask a question. Please press Star then the number one we'll pause for just a moment to compile the Q&A roster.
Again star one to ask a question. Your first question is from the line of Sam.
Yeah, Hi, Sam on the Littler Investor.
Carter so on the crushing.
I have a question about that.
No Daily Inc.
I think Ron you mentioned youre working to address that.
Are you planning to pay out of cash are.
Using shares.
Yes so.
Obviously, the Cadillac transaction than the $74 million that we brought in net upfront on that has short up the balance sheet very well.
We are looking at alternatives absent a better alternative we would plan to retire the debt in June.
And we are still looking at that.
Okay.
So so potentially finance that.
Get another.
So you are looking at all options.
Yes, we are and again I just want to say, we're about a month away.
So on the due date. So we are prepared to retire the debt in June and.
With the.
In the time until then we're continuing to explore options, but if there are not better alternatives than simply retiring it we would do that.
Okay.
Alright. Thank you Paul Thanks for your answer yes.
Again star one if you'd like to ask a question.
Okay.
And there are no questions in queue.
At this time.
Alright, well, thank you everyone for joining us.
We're pleased with the progress and we look forward to updating you next quarter.
A great rest of your week.
Yes.
That does conclude today's conference. Thank you for participating you may now disconnect have a great day.