Q2 2023 ADMA Biologics Inc Earnings Call
Good afternoon, and welcome to the Atmos Biologics second quarter 2023 financial results and corporate update conference call on Wednesday August nine 2023.
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 and will be available on the company's website approximately two hours following the end of the call.
At this time I would like to introduce Skyler Bloom senior director of business development and corporate strategy, adding a biologics. Please go ahead.
Welcome everyone and thank you for joining us this afternoon to discuss asthma biologics financial results for the second quarter 2023, and recent corporate updates I am joined today by Adam Grossman, President and Chief Executive Officer, and Brian Lenz, Executive Vice President and Chief Financial Officer.
And general manager of the Biosimilars.
During today's call Adam will provide some introductory comments and provide an update on corporate progress and then Brian will provide an overview of the company's second quarter 2023 financial results. Finally, Adam will then provide some brief summary remarks before opening up the call for questions.
Earlier today, we issued a press release detailing <unk> second quarter 2023 financial results and summarize certain achievement and recent corporate updates. This release is available on our website at www dot asthma biologics dot com.
Before we begin our formal comments I'll remind you that we will be making forward looking assertions during today's call that represent the company's intentions expectations or beliefs concerning future events, which constitute forward looking statements for the purposes of the safe Harbor provisions under the private Securities Litigation Reform Act of 1995.
All forward looking statements are subject to factors risks and uncertainties such as those detailed in today's press release announcing this call as well as in our filings with the SEC, which may cause actual results to differ materially from the results expressed or implied by such statements. In addition, any forward looking statements represent RV.
Hughes only as of the date of this call and should not be relied upon as representing our views as of any subsequent date, we specifically disclaim any obligation to update any such statements except as required by the federal Securities laws.
We refer you to the disclosure notice section in our earnings release, we issued today and the risk factors section of our 2022 annual report on Form 10-K for the year ended December 31, 2022, as well as our quarterly report on Form 10-Q for the quarter ended June 32023 for a discussion of important.
Factors that could cause actual results to differ materially from these forward looking statements. Please note that the discussion on today's call include certain non-GAAP financial measures, including adjusted EBITDA and adjusted net loss a reconciliation of these non-GAAP financial measures to the nearest comparable GAAP metrics is available in our earnings release.
With that said I would now like to turn the call over to Adam Grossman.
Thank you Skyler.
We're proud to report that we continue to rapidly grow our adjusted EBITDA base, which during the second quarter totaled $6 $4 million.
Representing 160% sequential growth compared to the first quarter of 2023.
This accomplishment was facilitated by an impressive 77% year over year increase in total revenues, which reached $61 million in the second quarter.
This robust revenue growth has resulted in meaningful operating leverage underpinned by continued gross profit growth and disciplined management of operating expenditures.
Based on the strong momentum established year to date.
We are now raising fiscal year 2023, total revenue guidance to more than $240 million upwardly revise from the $220 million previously provided.
Additionally, we remain confident in sustaining our growth trajectory in adjusted EBITDA throughout the remainder of 2023 and beyond.
The encouraging business trends and compelling forward looking indicators have enabled admah to increased fiscal year 2024, and fiscal year 2025, total revenue guidance to at least 275 and $325 million respectively.
And otherwise reiterate confidence in meeting or exceeding all profitability targets.
And our view Adam as year to date financial results combined with the increased financial guidance place Admah among only a select few standalone biopharma companies with comparable revenue growth profiles and adjusted EBITDA generation.
We believe this financial profile, coupled with unique asset scarcity value positioning the company amongst an elite biopharma peer groups.
We believe our continued success in the growing U S 10 billion dollar immunoglobulin and market is attributable to our innovative business model unique product portfolio targeted medical education efforts and most importantly, our core focus on treating underserved immune deficient patient populations.
Since launching commercially.
<unk> has been unwavering in our specialized focus on the primary immune deficient patient population and.
And we believe it is this concentration that has enabled <unk> to maintain its position as the fastest growing provider of immune globulin in the United States marketplace.
During the second quarter, we treated a record number of primary immune deficient patients and gained strong market share paving the way for promising new business prospects and expected go forward success in this market segment.
Our evolving product mix continues to maintain its favorable and strengthening trajectory in 2023.
We believe the growth of incentive is driven by its unique composition and utilization among immune globulin therapies, and it's real world evidence to improve outcomes for at risk immune compromised patients with primary immunodeficiency or Pi.
The value proposition of incentives within the immune globulin landscape was further articulated during our presence at the 2023 clinical Immunology Society annual meeting, which took place during the second quarter.
At this meeting Atmos sponsored a well attended medical education Symposium presented by a nationally recognized key opinion leader, who spoke the real world challenges associated with respiratory viral infections or RV eyes in patients with Pi.
Despite the availability of standard immune globulin therapies experts noted that more than 90% of patients with Pi continued to experience recurrent infections and associated complications.
Clinical data presented at the <unk> meeting highlighted that more than one third of this population continued to experience bronchiectasis, along with a rapid decline in lung function adversely impacting outcomes and causing quality of life issues for patients and their families.
Of particular significance certain patients with Pi exhibit T cell defects and thus can experience prolonged rbis that present risk for bacterial super infections and poor outcomes.
The real World case report presented in at risk patient that was successfully treated with incentives.
We are encouraged to see the unique product profile of incentive continues to resonate in clinical practice real world settings.
Along these lines, we are seeing signs of patient and prescriber persistence bolstered by a record expansion of new accounts and reorder prescribing velocity among existing customers.
We anticipate that this therapy will continue to capture an even greater share of our overall product portfolio mix over the coming period and beyond.
During the second quarter and recent periods, we made progress in advancing growth opportunities that will if successful further enhance our position in the market and increase our potential earnings power.
One such opportunity is the recent successful advancement of multiple incentive batches through production at the expanded 4400 liter manufacturing scale.
This expansion is expected to improve the products margin profile and increased plant production throughput capacity supporting our forecasted rapid growth trajectory.
We anticipate these benefits may be realized beginning later in 2023 and into 2024 and beyond.
Secondly.
The advancement of our yield enhancement initiatives is showing promise.
The company has made progress with development scale and laboratory analyses.
With the potential to increase both peak revenues and margin potential upon the successful validation of commercial scale production and receipt of requisite regulatory approvals.
The impact of yield enhancement initiatives, if successful could provide for potentially transformative upside to the company's peak financial targets.
Finally, our ongoing post marketing clinical studies are progressing well and.
And may provide label expansion opportunities further strengthening our product portfolio compared to our immune globulin peers.
As we have detailed in today's press release I'd like to reiterate that the increased revenue guidance. We've provided does not yet include any potential upside from these growth initiatives should they materialize.
We look forward to updating the market on these developments.
On a normal source in RSV plasma supply front, we believe we are well prepared to support all upwardly revised revenue forecast for our immune globulin portfolio.
The rapid expansion of our bio centers collection network. In addition to our contractually secured third party supply contracts provide us with the financial and supply chain flexibility needed to meet our immune globulin portfolio is growing end market demand.
Currently all 10 collection centers in our network are operational with nine now FDA licensed and we anticipate achieving complete FDA licensure before year end 2023 for our 10th collection Center after.
After which we believe we will have established cost competitive plasma supply self sufficiency.
As we reflect on our journey and the milestones we've achieved it becomes evident that admin success is a direct result of the unwavering dedication and hard work exhibited by our exceptional employees.
It is with great appreciation that we recognize the commitment passion and diligence that each team member brings to the table driving our organization's triumphs and enabling us to take complete control of operations aligning with our core vision.
We believe the solid foundation paves the way for even greater expected success in the future.
We extend our gratitude to the entire Admob biologics and Admob biosensors teams for your relentless efforts you put in day in and day out.
Youre remarkable contributions not only fuel our accomplishments, but also make a meaningful difference in the lives of those who rely on us.
It is the collective spirit of teamwork that make our workplace truly exceptional.
With this said I would now like to turn the call over to Brian for a review of the second quarter 2023 financials.
Thank you Adam.
Issued a press release earlier today outlining our second quarter 2023 financial results and we will be also issuing our second quarter 10-Q. Later this afternoon, which we would encourage you to read in conjunction with our comments and discussion points. We will make during today's call I will now discuss some of the key highlights from the second quarter.
As Adam mentioned earlier total revenues for the three months ended June 32023, or approximately $61 million as compared to $33 9 million.
During the three months ended June 32022, and this represents an increase of $26 2 million or approximately 77% the.
The increase is attributed to our higher sales of our immune globulin products, driven by increased physician payer and patient acceptance and utilization as well as expansion of our customer base the growth in product revenues. During the quarter was partially offset by a $1 $4 million decrease in third party J plasma sales.
From a buyer centers business segment, and this was consistent with our expectations in the context of fulfilling our long term plasma supply agreement during the first quarter of 2023.
Our gross profit for the three months ended June 32023 was $16 7 million as compared to $7 8 million for the same period a year ago.
This represents an increase of $8 9 million as a result of this increase admah achieved a gross margin of 27, 8% in the second quarter of 2023 as compared to 22, 9% in the second quarter of 2022.
Importantly, accounting for an estimated $2 $1 million impact on a second quarter cost of goods sold pertaining to an it disruption, which the company took responsive steps to rapidly remediate and normal course production and operations have resumed across our business units Adam estimate second quarter 2023.
Okay related gross margin would've been 31% to 32% on a normalized basis.
We believe the pathway as well paved to continue to grow gross profits over the coming periods.
Our consolidated net loss was 16 was $6 4 million for the second quarter of 2023 as compared to $13 8 million for the second quarter of 2022.
The $7 $4 million decrease in net loss was mainly due to the narrowed operating loss of $8 7 million attributable.
Attributable to the increased revenues gross profit and the increase of interest income <unk> 4 million, partially offset by the $1 $7 million increase in interest expense.
Adjusting for $2 8 million in total of non reoccurring charges related to the it disruption our adjusted net loss was $3 6 million for the second quarter of 2023, a significant period over period improvement.
Admin grew adjusted EBITDA to $6 4 million for the three months ended June 32023, as compared to an adjusted EBITDA loss of $6 $3 million for the same period a year ago.
The adjusted EBITDA improvement was driven primarily by increased sales and gross profit.
We anticipate continued adjusted EBITDA growth throughout this year and beyond.
<unk> balance sheet remains strong at June 32023, Admah had working capital of $224 $3 million primarily.
Primarily consisting of $161 $8 million of inventory cash and cash equivalents of $62 $5 million and $36 $7 million of accounts receivable. This was partially offset by current liabilities of $42 million.
Lastly, our admit biosensors network now consists of nine FDA licensed collection centers with one final center operational and collecting plasma.
Which is pending FDA licensure anticipated for year end 2023, and in the same period, we forecast raw material plasma supply self sufficiency from all 10 of our centers.
We remain encouraged by the real time improvements and donor foot traffic and collection volumes, which continued to achieve record all time highs and we remain considerably above our organizations pre pandemic levels.
With that I'll now turn the call back over to Adam for closing remarks.
Thank you Brian .
The companys growth and business trends are stronger than ever and we believe our forward looking visibility allows us to confidently meet or exceed our newly increased financial targets.
With a solid foundation in our supply chain and commercial infrastructure, we anticipate maintaining best in class revenue growth and potentially achieving an ultimate margin profile at the upper bound amongst our peers.
In the immediate periods ahead, we expect to grow adjusted EBITDA.
And advance towards net income profitability.
We are additionally, committed to thoughtfully pursuing new growth opportunities and we are optimistic about the potential they hold for further enhancing our profitability over the near and longer term.
We are excited to build on the momentum of the second quarter of 2023.
And to drive further success and stockholder value.
Although admass terminated its financial advisory agreement with Morgan Stanley the evaluation of strategic business alternatives remains ongoing and a top corporate priority for the company.
Thank you for your continued support and trust in the company.
We look forward to our journey ahead.
I would like to thank you our stockholders for your continued support as your investment and add my helps to advance our mission to save lives and make high quality safe and efficacious products that help our friends family and neighbors.
Please donate plasma and help save lives.
With that I'd now like to open up your call for questions operator.
Thank you today's question and answer session will be conducted electronically.
Pause just a moment to assemble the roster.
Our first question comes from Gary Nachman with Raymond James Your line is open.
Hi, guys, good afternoon, nice quarter and guidance.
The party Gary Yes.
Yes.
It's good to be here, so Adam maybe you could talk more about the uptake youre seeing with the <unk>.
Specifically what types of patients are getting put on it.
And what's the reimbursement status given the higher price point for the product.
And then also the persistent youre, saying for both the patients and the physicians that you mentioned.
So what portion of the revenue is currently assertive versus <unk> again, and then what are some of your initiatives to expand.
That uptake with incentives even further.
Thank you for the great questions.
There's a lot there so I hope I touch on everything.
What I can say to answer one of your I think your third question first roughly about a third of the revenue is coming from our higher margin products.
Seeing sequential growth quarter over quarter, we're seeing increased uptake.
We tried in the prepared remarks in the press release to emphasize because we've been getting this question a lot from analysts from from investors who are these patients and we're really trying very hard to delineate that these are primary immune deficient patients. These are people that are diagnosed with one or more forms of immune deficiency.
Some patients may even be medically immune compromised and these patients have comorbidities. They have other risk factors. They have T cell issues. They have bronchiectasis they have an increased risk of.
Respiratory viral infections. These are patients who are typically on standard immune globulin therapy, but don't seem to do that well.
They continue to have problems they continue to Miss day's work and school.
So the long story short is that.
Since incentives.
I should say prior to incentives there was no alternative for these patients. It was just standard IV switching from one brand to another so it is that it really offers the first.
Type of product, where it's made in a unique way that's protected by our patents. We use plasma collected from donors that are tested to have high tires to certain respiratory viral pathogens that Glen this plasma, making a product that has a differentiated antibody profile.
What I can tell you Gary is that the data that's out there in the public domain shows that we are seeing improved outcomes in these patients.
Patients are durable, they're staying on therapy.
For multiple years at this point in time, we're in our third year since the commercial launch of the product and.
Really it's been a grassroots effort here and what we're seeing now is a more rapid uptake you asked about payers and reimbursement.
And the right patient types.
<unk>.
We're not seeing challenges there.
Once that have documented persistent and chronic infections.
Patients that cost the system a lot of money because they are hospitalized one or more times per year again, they have bronchiectasis. Many of these patients go on organ transplant list.
After multiple bouts of bacterial pneumonia, so the pharmacopeia economic rationale is gain.
Gaining momentum out there and because every IV AIG has a unique J code.
Reimbursement is it is.
Being received for the product.
I can tell you that we are.
Penetrating existing accounts.
Once clinicians see the results in their problematic immune deficient patients.
They are more willing to.
Try the product in additional patients and we're seeing this rapid utilization in a more rapid uptake quarter over quarter.
We think that <unk> is still in the early innings as.
As we look at the primary immune deficient market theres roughly $250 to 500000 people diagnosed with one or more forms of primary immune deficiency and roughly somewhere between 10.
10% to 30% of these patients we feel could be our target market. So theres tens of thousands of patients. So we feel that we potentially haven't even scratched the surface.
We're now making <unk>.
The 4400 liter scale, so the margins that youre seeing for the product today it's.
It's product that we made last year, so you're seeing our expenses today, but the revenue that we're generating is.
From product that was made last year and what I can tell you is that as as we're looking at our yields at our business is operating more efficiently as we are getting better.
I don't just Pat our employees on the back they are doing a better job than they ever have and we're spending less and we're gaining more yield gaining more efficiency controlling costs better so.
We think we've got wind at our backs, we feel really confident that the drug is doing what we intended and maybe I'll just touch on this a little bit to that.
We've been focused on the primary immune deficient market since the company was founded.
Our motto is advanced therapies for the immune compromised.
It's something that we're just making up today, just because of where where the status is and where the industry is many of our larger competitors are now starting to talk about primary immune deficiency.
<unk> only been talking about immune deficient patients since inception.
Thats why I founded the company, it's why Jerry and I put our money up to start this company as we recognized an unmet medical need in the immune deficient patient population 15 years ago, and we're seeing the benefits of.
Of of that.
Today, we really feel that we've been vocal champion and this is something I have said on multiple conference calls where the vocal champion for the immune deficient population that typically doesn't have a voice and we're very proud of the work that we're doing and the benefits that.
These problematic patients are seeing in the market. So it was a lot that you asked I gave you a long answer hopefully I touched on most of your.
Questionnaire.
Yes that was great. Thank you for all that detail and just a quick follow up so when you consider the raised guidance for this year and then for 'twenty four 'twenty five what are you factoring in the mix in terms of incentive Ambev again and that guidance is it a third and two thirds.
Just put some context around the magnitude of potential upside from a greater mix shift to a center.
And also the the label expansion opportunities.
And then further yield enhancement. So are you eliminated any way with your plasma supply.
You can achieve some of those other target. Thanks.
Great questions also Gary and.
What we've always said historically is that.
Our higher margin products are incentive and Nabi HB.
Historically, we've said a 70 30 split between began being the primary revenue driver and.
Incentives and Navi being b.
Smaller share.
Where we're seeing increased utilization of the saves and what Brian and I have said in the last couple of calls is that.
We're seeing.
A move closer to that 65, 35 split depending upon the quarter.
We're growing on all sides, so it's not like fix.
But what I can tell you here is that.
Is there a potential to get to a <unk>.
60, 40, maybe even 50 50 split in the out years, there is certainly a potential.
Roughly about 10% of plasma donors have the antibody profile that we're looking for for the plasma that's used at the starting material for a Senate batches.
But being that we have got 10 collection centers open and collecting plasma what I can tell you is that it's not just 10% of the plasma that we're collecting we've got the power and the control to choose which people come in to donate plasma that day.
We may run special bonuses for donors that had the antibody profile for incentive we may run promotions, where we pay them more than what I can say is that.
The plasma that we're collecting.
<unk>, it's more than 10% of our overall collections.
Collections.
We're implementing strategies in house, which I've talked about on previous calls around accelerating testing, bringing some of the testing in house, which will accelerate turnaround time for identifying these donors as.
As well as reducing costs, but we're not paying our third party labs to do this testing that ultimately is going to lower our cost of goods.
An increased margin. So we've always said that incentive is roughly an 80% margin product we think.
As we move into the future it could be 90% plus.
On.
You touched on yield enhancement strategies again that touches our entire manufacturing portfolio all of our products.
We're not prepared to two <unk>.
<unk>, how much more yield we anticipate but.
My prepared remarks, I did say that we think this could be potentially transformative so.
To the upside.
Financial guidance in the range that we've given today does not contemplate.
Increased yield it does not contemplate.
Anything greater than that 70, 30 mix that I've been talking about so.
We're very concerned I know youre, just getting to know us Gary but.
The other analysts on the call have been dealing with me for a while.
Our investors have been dealing with me for a while we are intentionally conservative in our guidance.
We like to set good expectations and we'd like to beat them. So I do think that there is substantial potential for upside here.
But things take time nothing moves fast in the world of biologics.
Got some work to do in order to get conformance batches made and stability data.
Taken and.
And.
At the end of the day.
We think that.
We've got substantial upside and profitability metrics here that are not yet contemplated in our guidance.
Okay, Great I appreciate all that thanks and congrats.
Thanks again Gerry.
One moment for our next question.
Yes.
Our next question comes from Anthony <unk> with Mizuho. Your line is open.
Thanks.
Hey, Adam Thanks, and good afternoon, everyone you guys. Congrats here another.
Another great quarter really kind of.
Just looking at the.
The history here now I think.
Six quarters of a beat and raise so it's.
It's great to see and congratulations to the team maybe Adam we hosted.
Ill just call a few weeks ago, just exploring the use case for <unk>.
And a few interesting data points come out of that call one is.
That in particular in this individuals' practice they are actually seeing.
Benefits in these patients where they were quote unquote refractory to traditional immunoglobulin. So maybe from from the company standpoint, and anecdotally. When you think about these complex immune deficient patients that are susceptible to follow on respiratory infections. They are complex.
They're not responding to immunoglobulins.
What are you hearing from a broader set of your immunologist that are treating these patients.
So that would be the first question and the second question is.
And one of the data points that came out of that call us.
Perhaps there needs to be more physician education.
Around the benefits of <unk>.
In order to unlock really having this product reach more of these complex patients and so what is the sort of go to market strategy here now that incentive is sort of becoming a go to solution. Here are you increasing the sales efforts to reach more of these.
Patients and all of the follow up for Bryan. Thanks.
Thanks Anthony.
Great questions I appreciate it.
Your continued support.
The easiest answer I can give you is that patients are doing very well on Senate I mean, that's that's been the story since the beginning and.
And again I think building on.
That grassroots effort one patient at a time the durability of the drug do you see the increased revenues you see the way that the financial metrics.
Are playing out for the business.
That doesn't happen when you don't have a product that isn't doing what we promise and thats improving outcomes for these patients full.
Full stop.
I think that.
Heartland going into the second part of your question.
What's next what's changing.
We have effected lives and to the admin staff that that's on the call in and others that are close to the company I mean, we've all seen E. Mails, we've seen the E mails from the patients we've seen <unk> from the prescribers, even the conversation, but some of the payers to.
To be candid, where drug costs more but.
It costs more to collect this plasma.
And it's hard to find these donors and when we find them, we try to keep them but.
We make the product in a very reliable reproducible and consistent way.
It's a product that is not as valuable from an antibody profile perspective that that you see with other immunoglobulins to these antibodies that are outside of what.
The FDA.
As in the CFR for IAG around measles polio diphtheria.
And what I can tell you is that patient outcomes patients are doing better.
Something that we're moving towards and I think youll see maybe maybe by the end of the year, maybe beginning of next year.
Marketing Medical Affairs Scientific Communications group.
We've got patients now who want to be ambassadors for the drug and I think thats just something that you see.
And more mature.
Doug companies, where you've got these these patients that have done so well that they raise their hand, and say hey, I'd like to tell my story I'd like to talk about my journey and I think this is something that we're seeing from a number of patients out there and I think as we progress.
Furthering our medical education efforts, not only to the physician community, which which you asked about but it's also with the patients themselves.
Spending more time with the patient advocacy groups provide.
Providing more resources and an availability of information to patients better dealing with primary immune deficiency and talking to them about alternatives that are out there in the market today.
So I think these are things that youre going to see we are growing our commercial for some not exponentially I mean, we we've always said that we don't need.
Ft reps across the country here, we've got a small.
Commercial team, it's probably pushing raw.
$35 40 people in total and we've got a couple of open jobs, and where we're spending money, where we where we need to.
We're not.
We're not looking just to put our name in lights for the for the Hell of it Anthony.
We want meaningful spend that has real real outcome and I think with the medical education efforts that we're doing with the scientific symposia as we highlighted at the clinic.
Clinical Immunology Society meeting.
As we're doing in these regional speakers programs and we're rolling out our Speakers' Bureau.
I think that the physician to physician education is working extremely well.
But I'm really most proud of the work that I've seen from our medical Affairs, and scientific communications and marketing group around the patient advocates.
Once that becomes available we'll certainly let.
Our analysts know, but this is stuff that will be in the public domain.
And folks will be able to heal here the real world stories and treatment journeys of people who are on regular IGF people who're denied because they didn't meet all the criteria and then they start on IGN, They don't do well.
Suffered for a couple of years and then they go on incentive and all of a sudden they are back to work and school and again, it's not just the patient it's the patients.
Families caregivers and all of this matters.
Sure.
Coupling on the comments that I made to Gary's question I mean, we're really starting to.
C.
The benefits of founding Aetna, biologics and going through the struggle that's been added.
We're really seeing these benefits payoff and I got to tell you come in to work every day.
It's a lot more fruitful because we're making that much of a difference in the lives of so many thousands of patients.
<unk>, we are the only company that I'm aware of in the U S. It's making drug using centralization not filter presses and we think we're onto something here.
Both <unk> and incentive product profile safety profile is stellar.
We're really proud of the products that we provide to the immune deficient patient population.
That's very helpful and just two quick follow ups off back in here one would be just on pipeline just kind of curious we haven't heard anything on subcutaneous versions.
A bit again in a sense of is that in the cards at some point and then Brian just on plasma supply were at 10 centers in total $9 of FDA clearance.
Is 10 kind of the right number or when you look out over the next two to three years do you think that.
Plasma network collection base grows beyond the 10, where we're at today. Thanks again congratulations.
Thanks, Anthony so so I'll just start off by saying look we've got IP and our and our.
Armamentarium and when the time is right, we'll certainly let you know, but right now we're laser focused on.
Market penetration.
Building, the brand penetration and awareness of <unk>.
Maximizing yields.
Finding ways to unlock more value for little expense that.
What we're focused on here.
I can tell you that.
The.
The focus here is is just driving what we already have that's working.
It's continuing to.
Penetrate into the primary immune deficient in the secondary immune deficient markets and grow what we know is working.
We're making more product than ever at the <unk> 4400 liter scale.
This year was the first year that we've made batches and we made a couple of batches so far.
But we're working on budgets for next year, we're looking at the production plan and it's going to be all 44 100, all the time more plasma through this plant getting unabsorbed down.
Making more drug having more output and then you couple that with the yield enhancement strategies, bringing more fill finish in house. I mean, these are ways that we're going to improve our margin profile beyond anything that you and I have ever talked about over drinks or otherwise Anthony.
I will tell you that I'm very excited.
We are still in the early days here at at and being able to raise guidance.
Two now $3 25 or more.
I never thought in a million years, we would be here.
When we took this plan over and they had the warning letter I never in a million years thought I'd have $60 million quarters.
This plant.
Under the prior management never generated more than $55 million in a year and we're doing that in a quarter and we're just beginning so.
That's what's next for US what's next is to keep doing what we're doing do it better do it more efficiently.
To the admin staff on the call I told you I was going to say this on the call and it's up to you to make it happen.
I think it's the early days and Youre going to Youre going to start seeing.
Cash flow is Mr wonderful likes to say very very soon.
Let Brian answer the question on the centers sure. Thank you Adam So Anthony regarding your question on the number of plasma centers.
Our centers are performing much better than expected we.
We're seeing we're very encouraged by the positive trends and momentum.
We're seeing daily and weekly record date collections and we're also seeing cost per liter efficiencies in some areas lower donor fees.
Mentioned.
Higher collections, we're really focused on labor and center efficiencies. We don't we're not looking at building any more than 10 centers. All 10 centers are built all 10 centers are collecting as you saw in July we received FDA approval for a knife center.
We'll certainly.
Certainly encouraged of getting our 10th center approved by year end and for US. It's all about plasma supply self sufficiency and those goals that we set for ourselves at the beginning of 2023 are certainly coming to fruition for the number of leaders that we're collecting and putting through the plant and again.
We're very pleased with how the centers are performing and again no no further capex for the centers no further build out so we're in a we're in a place right now as we look forward to the revised guidance revenue numbers are plasma centers will be fully self sufficient for us.
Okay.
One moment for our next question.
Okay.
Our next question comes from Kristen <unk> with Cantor Fitzgerald. Your line is open.
Hi, everyone and congratulations on another really solid quarter here first first question I have is maybe something I didn't really fully appreciate about the story is that the kols community and treating physicians are a lot more tight knit than I expected.
Just given that you've continued to showcase your data and findings and just a word of mouth around these positive key studies wanted to add.
How much of the trading community. You asked me is aware of the added benefits of <unk> is showing here.
Then looking into the next two years or so.
Anything beyond your guidance that Youre working on in terms of getting the word out more in terms of like conference appearances and you talked about.
Potential patient representatives as well.
Sure. Thank you Kristen very much in and I think you were at you may have been at says if I heard it was yes.
So.
Thanks for taking an interest there but.
You see it but there is there.
Theres a handful of.
Kols, if you boil that control a large part of the pie population, but we think that there is headroom.
We think that there are certainly.
Many more clinicians out there many more prescribers that are.
Just learning about something that I was just thinking about as you were talking we've also started running print print AD campaigns, which is strange right. This is the world of digital.
My experience and what our market research tells us is that immunologists like to pick up the actual journal of clinical immunology and in a couple of other publications and they like to actually flip. The paper. So we started running print ads and I think that that speaks to the fact that <unk> is starting to be recognized.
It's a brand name that.
That is.
Synonymous with immune deficiency.
Something that we've really worked hard at.
Joining the name admire the name incentive with immune deficient population, but I do feel very confident that that there is a lot of headroom available for us in gaining more.
We think that there is a ton of penetration opportunities among the existing prescriber base.
Remember roughly about 10 20, 30% of every prescribers patient population.
These comorbidities and as we get more data in the public domain as we're publishing more data.
As the Pharmacopeia economic impact is starting to show even more benefits.
We think that we're going to see existing growth at same store institutions.
We think that there are tremendous growth prospects with new prescribers, new infusion companies, new and specialty pharmacies that that we haven't yet tapped into and.
I really do.
See upside there.
The thing that was your question but.
Asked about subcutaneous and I'll just touch on that for a second while we have no.
Intention today.
To go for a sub Q route of administration I wanted to say that there was a publication from another immunologists kols who on their own.
<unk> did a study and they administer incentive in the subcutaneous route I believe that that publication was out of European meeting I don't recall, which one.
But I can get back to you on that but.
What I can say.
Is that I think that that answered part of your question is that prescribers are learning about the drug and they are starting to get more comfortable with the product and use it in novel ways.
So we feel good that there's a lot of room for us to grow hopefully that answers the question.
Yes. It does thanks and then.
And with a sense that you're not really having too many challenges, but I am curious if you can comment on the trends among the provider level.
Terms of is it pretty consistent on our provider base is and then how.
Do you work with those providers that ask you more questions, perhaps are a little bit more on the hesitant side.
We we've got a great market access team got a great patient assistance program I mean that.
The data is out there I mean, many IV <unk>.
Want to say al Im forgetting the data I've said it so many times I want to say, 70%, 80% of all <unk> requires a prior authorization anyway, whether it is on label or evidence base.
So it is not unheard of for the payers to require a whole bunch of information from the prescriber.
And the treater pull for the product again in the right patient population with the right Comorbidities and risk factors.
We're seeing payer acceptance of the product in the right patient type of gas for the product for a patient that doesn't need the product they are not going to get it.
The mix between public and private is about a 50 50 split but but.
The value proposition is resonating our coverage is quite encouraging actually and I will tell you at the end of the day.
It's being used later in Ah patients treatment journey, if you will they failed 1234 different <unk>.
And after a payer has tried for different IV IGT has all their preferred products the patient's been hospitalized they keep getting bacterial pneumonia. They are they are suffering.
They try incentives and.
We've never said you've never heard me say incentives the best frontline therapy, I'm, not going to say that because thats not what its for.
Give us the product after you've failed everything else and you have nowhere else to turn coming to us we're going to save your life, we're going to improve your life.
And that's what we're seeing and I think that.
Analysts investors. Some people are like that doesn't resonate that doesn't compute to them and that's fine but.
Not everybody has to be a frontline therapy.
And when you look at the margin profile of a setup I don't care when patients get on the drug come come come to the <unk>.
Come to the island that has asthma we're.
We're here for you we've got plenty of product in inventory, we can produce as much as the market seems to need right now and.
We're happy to trade began batches for ascent of any day.
To the patients out there in the patient advocacy communities.
We're committed to collecting more plasma and meeting with them.
And if this product is something that can benefit the lives of these immune deficient underserved patients.
We're very pleased and happy to help.
It's not lip service I've been saying it for years.
Say to our team all the time why does it matter it matters because the patients are counting on US. We are the first company to do something different we're the first company to move the peg forward.
Which is what when I was down and out on my luck. Many many years ago. One of our Kols said to me Adam you got to keep going because you are moving the peg forward and that's what we do here at Atmos, So it's not a frontline therapy Christina.
But after you fell a couple of IGF payers pay.
Okay, great. Thanks, and I know you guys are reaching about 10 years since you IPO Ed. So you should feel very proud about all the progress you've made to today. So congratulations.
We're still here still alive.
<unk>.
With with with growing EBITDA.
Net income around the corner.
Thank you ladies and gentlemen, this will conclude our question and answer portion of the call I would like to turn it back over to Adam now for additional closing remarks.
Thank you everybody. Thanks, Thanks for your interest attention and time.
Great you dialing into the call again, I think we're still in the early innings.
I think theres a lot of upside here and.
We appreciate your continued support.
Plasma help save lives visit asthma biosensors dot com.
A visit one of our 10 collection centers that may be near you and stay healthy and have a very great evening. We appreciate you.
Ladies and gentlemen, this does conclude the conference call for today. We appreciate your participation and you may now disconnect.
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