Q4 2023 Assertio Holdings Inc Earnings Call

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Operator: Thank you for standing by, and welcome to the Assertio Holdings fourth quarter and full year 2023. I would now like to welcome Matt Kreps, investor relations for the company, to begin the call. Matt.

Thank you for standing by and welcome to the 30th Holdings fourth quarter and full year 2023 results call I would now like to welcome Matt Kreps Investor Relations for the company to begin the call Matt over to you.

Matthew Kreps: Thank you, and good afternoon, everyone. Thank you for joining us today to discuss Assertio's fourth quarter and full year 2023 financial results. The news release covering our results for this period is now available on the investor page of our website at investor.assertiotx.com. I would encourage you to review the release and the tables in conjunction with today's discussion. With me today are Heather Mason, Interim CEO; Ajay Patel, Chief Financial Officer; and Paul Schwichtenberg, Chief Commercial Officer. In just a moment, Heather will open the remarks and provide an overview of the business.

Matthew Kreps: Thank you and good afternoon, everyone. Thank you for joining us today to discuss <unk> fourth quarter and full year 2023 financials.

Matthew Kreps: He is really is covering our results for this period is now available on the Investor page of our website at Investor <unk>, TX Dot Com I would encourage you to review the release and the tables in conjunction with today's discussion.

With me today are either Mason interim CEO, Ajay Patel, Chief Financial Officer, and Paul Schwichtenberg, Chief Commercial officer.

Matthew Kreps: Heather will open their remarks and provide an overview of the business in Asia will cover our financial results and guidance followed by Paul with an update on our commercial strategies.

Heather Mason: Then Ajay will cover our financial results and guidance, followed by Paul with an update on our commercial strategies. After that, we will take a few questions from the floor and answer them. During this call, management will make projections and other forward-looking statements regarding our future performance. Such forward-looking statements are not guaranteed and involve risks and uncertainties, including those noted in this afternoon's press release, as well as Assertio's filings with the SEC. These and other risks are more fully described in the risk factors section and other sections of our annual report on Form 10-K, forward-looking statements. Assertio specifically disclaims any intent or obligation to update these forward-looking statements, except as required by law. And with that, I will now turn the call over to Heather. Please go ahead.

Matthew Kreps: After that we will take a few questions from our covering analysts.

Matthew Kreps: During this call management will make projections and other forward looking statements regarding our future performance such forward looking statements are not guarantees of future performance and involve risks and uncertainties, including those noted in this afternoon's press release as well as <unk> filings with the SEC.

Matthew Kreps: These and other rest are more fully described in the risk factors section and other sections of our annual report on Form 10-K.

Matthew Kreps: Our actual results may differ much.

Matthew Kreps: The forward looking statements <unk>, specifically disclaims any intent or obligation to update these forward looking statements, except as required by law.

Matthew Kreps: And with that I will now turn the call over to Heather. Please go ahead.

Heather Mason: Welcome, everyone, to our fourth quarter results. And thank you for joining us. Today, I'm excited to be here with Ajay, our CFO, and Paul, our Chief Commercial Officer, to give you a comprehensive update on Assertio, our business, and our direction. I'm here to share solid operating results for the fourth quarter and a strong balance sheet at year end. Our strategy for Wolvidon, our most important growth driver. Our outlook for Indison, including fourth quarter actual results in our 2024 assumptions, a lower operating expense base designed to maximize commercial contribution and cash flow generation opportunities, continuing plans for corporate business development, and importantly, updated guidance for the year ahead. Assertio's direction and financials have shifted as a result of the role of the Adan Acquisition and generic competition for indices.

Heather: Welcome everyone to our fourth quarter results and thank you for joining today I'm excited to be here with a J, our CFO and Paul <unk>, Our chief commercial officer to give you a comprehensive update on our <unk>, our business and our direction.

Heather: I'm here to share solid operating results for fourth quarter, and a strong balance sheet at year end.

Heather: Our strategy for Rover dial, our most important growth driver.

Heather: Our outlook for investing including fourth quarter actual results and our 2024 assumptions.

Heather: Our lower operating expense base design to maximize the commercial contribution and cash flow generation opportunities are.

Our continuing plans and corporate business development, and importantly updated guidance for the year ahead.

Heather: The 30th direction and financials have shifted as a result of the role of the dawn acquisition and generic competition for <unk>.

Heather Mason: We remain focused on cost-efficient operations and cash generation with Rolvidon as the primary growth driver. Our goal today is to frame future performance expectations given this evolution. I do want to thank all of our stakeholders, investors, and partners for their patience while we have navigated several challenging months in 2023. I'd also like to acknowledge the talented, hardworking team at Assertio who have demonstrated exceptional dedication to success in delivering the results reported today. Having worked with them over the past few months, I am confident in this team's ability to deliver on these and future plans. As you know, I've been an independent member of Assertio's board since 2019.

Heather: We remain focused on cost efficient operations and cash generation with Rover Darrin as the primary growth driver.

Heather: Our goal today is to frame future performance expectations given this evolution.

Heather: I do want to thank all of our stakeholders investors and partners for their patience, while we have navigated several challenging months in 2023.

Heather: I'd also like to acknowledge the talented hard working team Edison <unk>, who have demonstrated exceptional dedication to success in delivering the results reported today, having worked with them over the past few months I am confident in this team's ability to deliver on these and future plans.

Heather: Okay.

Heather: As you know Ive been an independent member of <unk> Board since 2019, and my prior professional roles they focused on commercial execution and operational leadership by increasing product sales and share.

Heather Mason: In my prior professional roles, I focused on commercial execution and operational leadership by increasing product sales and market share, aligning expenses with growth, and managing balance sheet efficiency, all highly relevant to Assertio today. In addition, we've made good progress in our search for a permanent CEO. The expectation is that this new leader will continue to deliver against our strategy of existing asset growth, lean operating expenses, and acquisitions that fit our go-to-market model. To that point, the results we released this afternoon demonstrate the durability of our Assertio business model.

Heather: Aligning expenses with growth and managing balance sheet efficiency.

Heather: Highly relevant to <unk> today.

Heather: In addition, we've made good progress in our search for a permanent CEO.

Heather: The expectation is that this new leader will continue to deliver against our strategy of existing or asset growth.

Heather: Operating expenses and acquisition that fit our go to market model.

Heather: To that point the results. We released this afternoon demonstrate the durability of our <unk> business model. We are reporting sequentially increased role the DAU and revenue we are thoughtfully managing interest in volume and price given generic competition.

Heather Mason: We are reporting sequentially increased Rolvidon revenue. We are thoughtfully managing indecent volume and price given generic competition. We remain operating cash flow positive, and today we also shared our guidance for the year ahead with sales expected to be in the range of $110 to $125 million and EBITDA in the $20 to $30 million range. To reiterate, we are excited to have Rolvidon in our portfolio for its growth prospects, which have been brought to life by my meetings with key customers and in working with our sales and marketing organization. And as a reminder of the broader organization, Ajay became our CFO in November, and Paul has now formally transitioned to Chief Commercial Officer, leveraging his in-depth knowledge of Assertio and strong commercial finance background. I'd also like to highlight the news included in today's release that Sig Kirk will be joining our Board of Directors in April. SIG joined Assertio as an external advisor in January, bringing extensive business development, finance, and strategic expertise.

We remain operating cash flow positive and today, we also shared our guidance for the year ahead with sales expected to be in the range of $110 million to $125 million and EBITDA in the $20 million to $30 million range.

Heather: To reiterate we are.

Heather: We're excited to have roles are done in our portfolio for its growth prospects.

Heather: Have been brought to life by May meetings, with key customers and in working with our sales and marketing organization.

Heather: Yes.

Heather: And as a reminder of the broader organization a J became our CFO in November and Paul has now formally transitioned to chief commercial officer, leveraging his in depth knowledge of the studio and strong commercial finance background.

Heather: I'd also like to highlight the news included in today's release that staying Kirk will be joining our board of directors in April.

Heather: He joined US 30 O as an external adviser in January bringing extensive business development finance and strategic expertise.

Ajay Patel: Sig most recently served as executive vice president overseeing corporate business development at Allergan. During his 11-year tenure, he led more than 75 deals from small tuck-in asset acquisitions and licensing to larger M&A transactions, driving both revenue and market cap growth. I look forward to working with SIG in his capacity as a board member. And with that, I'll pass the call over to Ajay, who will cover the financials. Thanks, Heather.

Most recently served as executive Vice President overseeing corporate business development at Allergan.

Heather: His 11 year tenure, he led more than 75 deals from small tuck in asset acquisitions and licensing to larger M&A transactions driving both revenue and market cap growth.

Heather: I look forward to working with <unk> in his capacity as important Denver.

Heather: And with that I'll pass the call over to a J, who will cover the financials.

J: Thanks Heather.

Ajay Patel: Today, I would like to cover our financial results for the fourth quarter of 2023 and provide some background and context on our financial guidance for full year 2024. Before I begin, as it relates to our comparison of the fourth quarter of 2023 to the prior year's fourth quarter, I want to establish that the 2022 fourth quarter was an all-time high for Indocent, which contributed to those overall results. Since then, both Indusyn and Cambia have had generic entrants, and we have acquired Rolvidon, which is a new growth driver. For the current year's fourth quarter, our total sales were $32.5 million, including Rolvidon sales of $11 million and Indusin sales of $10.8 million. Lovidon sales have improved sequentially since the closing of the acquisition on July 31st, 2023.

J: Today, I would like to cover our financial results for the fourth quarter of 2023 and provide some background and context on our financial guidance for full year 2024.

J: Before I begin as it relates to a comparison of the fourth quarter to the prior year fourth quarter I want to establish that the 2022 fourth quarter was an all time high for indifferent, which contributed to those overall results. Since then both in <unk> and can be app had generic entrants and we.

J: Acquired with <unk>, which is a new growth driver.

J: For the current year fourth quarter, our total sales were $32 $5 million, including roll the dine in sales of $11 million and in defense sales of $10 8 million.

J: Well over down sales improved sequentially since closing of the acquisition on July 31, 2023, we have now addressed the channel inventory issue highlighted in the prior quarter as well as streamlined and focused our commercial team to continue to grow this asset in.

Ajay Patel: We have now addressed the channel inventory issue highlighted in the prior quarter, as well as streamlined and focused our commercial team to continue to grow this asset. However, Indecent sales declined both sequentially and compared to the prior year fourth quarter due to the entrance of a generic competitor in August 2023. Gross margin in the fourth quarter was 70%, decreased from 88% in the prior year fourth quarter.

J: <unk> sales declined both sequentially and compared to prior year fourth quarter due to the entrance of a generic competitor in August 2023.

J: Gross margin in the fourth quarter was 70% decreased from 88% in the prior year fourth quarter.

Ajay Patel: Of the change, inventory step-up amortization contributed nine percentage points of the decrease in margin, with the remaining reduction primarily due to a change in sales mix from the addition of Robodon and a decrease in higher margin in Dyson and Cambia. Turning to operating expenses, SG&A expense was $24 million, increased from $13.7 million in the prior year fourth quarter. The fourth quarter included approximately $9.5 million in higher operating expense due to the addition of Spectrum. Adjusted operating expense in the fourth quarter was $21.8 million, and gap income from operations for the fourth quarter was a loss of $32.3 million, which included a few non-cash adjustments. We recognized a $41 million impairment charge for intangible assets, which primarily pertain to indecent, and a $17 million benefit for the change in fair value of

J: The change inventory step up amortization contributed nine percentage points of the decrease in margin with the remaining reduction primarily due to a change in sales mix from the addition of <unk> and decrease in higher margin and discerning can't be up.

J: Turning to operating expenses SG&A expense was $24 million increased from $13 $7 million in the prior year fourth quarter. The fourth quarter included approximately $9 5 million in higher operating expense due to the addition of spectrum adjust.

J: Operating expense in the fourth quarter was $21 8 million.

J: GAAP income from operation for the fourth quarter was a loss of $32 3 million.

J: Which included a few noncash adjustments, we recognized a $41 million impairment charge for intangible assets, which primarily pertaining to <unk> <unk>.

And a $17 million benefit for the change in fair value of the in this and contingent liability both adjustments were primarily driven by the impact of generic competition.

Ajay Patel: Both adjustments were primarily driven by the impact of generic competition. Adjusted EBITDA is a good indicator of the operating performance of our core business. Q4 Adjusted EBITDA came in at a positive $4.5 million, demonstrating the durability of our business model, even in a transitionary period. Please refer to our press release for a detailed reconciliation of our adjusted EBITDA results. Crossing over to the balance sheet, cash at year-end was $73.4 million, and debt was $40 million, which consists of a 6.5% convertible note due August 2027. We generated a positive $5.7 million in cash flow from operations during the fourth quarter.

J: Adjusted EBITDA is a good indicator of the operating performance of our core business Q4, adjusted EBITDA came in at a positive $4 5 million.

J: Trading the durability of our business model, even in a transition every period.

J: Please refer to our press release for a detailed reconciliation of our adjusted EBITDA results.

J: Crossing over to the balance sheet cash at year end was $73 4 million and that was $40 million, which consists of six 5% convertible notes due August 2027.

J: We generated a positive $5 $7 million in cash flow from operations during the fourth quarter.

Ajay Patel: As Heather mentioned, today we announce guidance for 2024. We expect net product sales in a range of $110 million to $125 million. Historically, we have not provided product-level guidance, but we recognize that Q4 and the start of 2024 have been a dynamic period, including revenue composition and continuing OpEx run rates. Therefore, for modeling purposes, we wanted to provide additional product-level contacts for Rovidone and Indicin on a one-time basis. As part of our 2024 plan, we expect Rolvidon Net Sales to approach $60 million. Paul will provide additional context on our role with Donna.

J: As Heather mentioned today, we announced guidance for 2024.

J: We expect net product sales in a range of $110 million to $125 million.

J: Historically, we have not provided product level guidance, but we recognize that Q4 and the start of 2024 has been a dynamic period, including revenue composition and continuing opex run rates. Therefore for modeling purposes, we wanted to provide additional product global contacts.

J: <unk>, Madonna and Edison and a one time basis.

J: As part of our 2024 plan, we expect <unk> net sales to approach $60 million.

J: Paul will provide additional context on our OIBDA outlook for.

Ajay Patel: For 2024, we expect indecent net sales in a range of 18 to $25 million. We expect continued unfavorability as a result of generic competition throughout 2024, both from a pricing and volume perspective. Although we don't have visibility into the generic approval process, for purposes of our 2024 planning, we have assumed an additional generic entry. From an operating results standpoint, we anticipate adjusted EBITDA in a range of $20 to $30 million. Gross profit will be impacted by a lower sales base and declining contribution from Indecent, which previously contributed higher margins.

J: For 2024, we expect indifferent net sales in a range of $18 million to $25 million. We expect continued unfavorable <unk> as a result of generic competition throughout 2024, both from a pricing and volume.

J: Although we don't have visibility into the generic approval process for purposes of our 2020 for planning we have assumed an additional generic entrant from.

J: From an operating result standpoint, we anticipate adjusted EBITDA in a range of $20 million to $30 million.

J: Gross profit will be impacted by a lower sales base and declining contribution from Edison, which previously contributed higher margins.

Ajay Patel: We expect adjusted operating expenses for the total company to be between $65 and $70 million. When we announced the Spectrum acquisition, we expected a $55 million increase in operating expenses on top of the legacy Assertio organization of about $40 to $45 million. Subsequent to the fourth quarter, Assertio further refined its combined organization and now anticipates combined operating expenses in this much lower total range. These numbers are approximations and not formal guidance, but we hope that they will help you fully appreciate our focus on operating cost efficiency and aligning expenses to sales. I would also note that as we developed the plan for 2024, we were very mindful of the change in revenues and gross profits and responded with an intense focus on ensuring our planned costs and investments were supporting growth in Rovida. As Heather mentioned, we expect to remain cash positive in 2024. And based on our adjusted EBITDA outlook, we are targeting to end the year with a cash balance of between $90 and $100 million.

J: We expect adjusted operating expenses for the total company to be between 65 and $70 million.

J: When we announced the spectrum acquisition, we expected a $55 million increase in operating expenses on top of the legacy <unk> organization of about $40 million to $45 million.

J: Subsequent to the fourth quarter of <unk> will further refined its combined organization and now anticipates combined operating expenses to this much lower total range.

J: These numbers are approximations and not formal guidance, but we hope that they will help you fully appreciate our focus on operating cost efficiency and aligning expenses to sales.

J: I would also note that as we develop the plan for 2024, we were very mindful of the change in revenues and gross profits and responded with an intense focus on ensuring our planned cost and investments we're supporting growth in <unk>.

J: As Heather mentioned, we expect to remain cash positive in 2024 and based on our adjusted EBITDA outlook. We are targeting to end the year with a cash balance of between 90 and $100 million.

Ajay Patel: Closing out my remarks, I have a couple of notes that are important to keep in mind as well. First, I would remind everyone that the plan I've just highlighted makes no assumption about the potential impact of possible BD transactions, which we continue to seek and evaluate. Any action on that front would require an update to our outlook. Second, our shelf registration statement recently expired, so we have taken the customary action of filing a new registration statement today to renew our availability under that instrument. That renewal action is not an indication of any pending transaction or other activity.

Speaker Change: Closing out my remarks, I have a couple of notes that are important to keep in mind as well.

Speaker Change: First I would remind everyone that the plan I've just highlighted makes no assumption about the potential impact from possible BD transactions, which we continue to seek and evaluate any action on that front would require an update to our outlook.

Speaker Change: Second our shelf registration statement recently expired. So we have taken the customary action of filing a new registration statement today to renew our availability under that instrument.

Speaker Change: That renewal action is not an indication of any pending transaction or other activity.

Paul Schwichtenberg: I'll now turn the call over to Paul to discuss our commercial organization and strategy. Thank you, Ajay. I'm pleased to be here today to update you on our commercial growth plans, in particular for roll it up. We are very excited to have this product in our portfolio and see excellent growth prospects in 2024 and beyond. The past several months have been a learning process as we've worked through several issues we inherited, including short-term incentives that were offered to customers, which resulted in excess inventory in the channel at the end of the second quarter of 2023. It was this excess inventory in the channel that resulted in lower than expected Rolvidon net sales in the third quarter of 2023. In Q4'23, we saw a return to normal inventory levels consistent with Assertio's inventory management practices and resulting net sales of $11 million, reflecting a 38% increase over the pro forma third quarter. However, even with this increase, the fourth quarter was impacted by further channel inventory reduction.

Speaker Change: I'll now turn the call over to Paul to discuss our commercial organization and strategy.

Paul: Thank you a J I'm pleased to be here today to update you on our commercial growth plans in particular for roll it up.

Paul: We are very excited to have this product in our portfolio and see excellent growth prospects in 2024 announcer.

Paul: The past several months have been a learning process as we work through several issues, we inherited including short term incentives that were offered to customers, which resulted in excess inventory in the channel at the end of the second quarter of 2023.

Paul: It was this excess inventory in the channel that resulted in the lower than expected roll. It on net sales in the third quarter of 2023.

Paul: In Q4, 'twenty three we have seen a return to normal inventory levels consistent with the <unk> inventory management practices and the resulting net sales of $11 million, reflecting a 38% increase over the pro forma third quarter.

Paul: Even with this increase the fourth quarter was impacted by further channel inventory reductions.

Paul Schwichtenberg: That issue is now behind us, and we are managing inventory and sell-through in line with the Assertio-derived business practices that have made us successful on our other products. Going forward, our focus is to ensure alignment between demand and extractory sales, which will allow us to better forecast the rollback on net sales going forward. We believe this practice, along with our overall growth strategy, will enable us to generate consistent, predictable growth throughout 2024 and ultimately take Robodon to over $100 billion in sales beyond 2024. Robodon has now acquired an estimated 30% share in our current third markets, and we see opportunity to continue to expand that market share through our excellent contracting and commercial access team capabilities.

Paul: That issue is now behind us and we are managing inventory and sell through in line with the <unk> derived business practices that have made us successful on our other products.

Paul: Going forward, our focus is to ensure alignment between demand and ex factory sales, which will allow us to better forecast roll it on net sales going forward.

Paul: We believe this practice along with our overall growth strategy will enable us to generate consistent predictable growth throughout 2024, and ultimately take the assets of over $100 billion in sales beyond 'twenty four.

Paul: <unk> has now acquired an estimated 30% share in our current served markets and we see opportunity.

Paul: To continue to expand that market share through our excellent contracting and commercial access team capabilities.

Paul Schwichtenberg: Additionally, Rovidon has seen sequential quarter-over-quarter demand growth since launch, and we expect this to continue into 2024. We will continue to invest appropriately in this growth opportunity, both in people and resources. We will have in-person promotion that will be focused on customer expansion, and we intend to leverage our non-personal digital promotion models to further drive roll it out awareness. But we see this as a starting line and just the early innings in the opportunity for this asset.

Additionally, Ramadan has seen sequential quarter over quarter demand growth since launch and we expect this to continue into 2024.

Paul: We will continue to invest appropriately in this growth opportunity both in people and resources. We will have in person promotion that will be focused on customer expansion and we intend to leverage our non personal digital promotional models. So further drive ROE with an awareness.

Paul: But we see this as a starting line and just the early innings and the opportunity for this asset.

Paul Schwichtenberg: At the core of this strategy is our excellent in-person oncology sales, contracting, and commercial access teams that will drive and enhance our market position, augmented by our innovative non-person promotion model and virtual resources. As you saw in our press release today, we announced the continued evolution of our Rolvidon commercial organization, which included a reduction in the size of the organization and a shift of resources to support our expansion to new customers and drive our overall growth strategy. These changes were carefully considered, and the optimized structure, reflecting a full commercial team of 32 including 16 field sales professionals, will ensure that we continue to maximize our overall profitability. I would also like to recognize our commercial team that has remained dedicated and focused since the Spectrum acquisition and express my sincere excitement to work with them going forward. I am truly impressed by this team and their dedication to Rolvidon.

The core of this strategy is our excellent in person oncology sales contracting and commercial access teams that will drive and enhance our market position augmented by our innovative non personal promotion model and virtual resources.

Paul: As you saw on our press release today, we announced the continued evolution of our roll around commercial organization, which included a reduction in the size of the organization.

Paul: And the shift of resources to support our expansion to new customers and drive our overall growth strategy.

Paul: These changes were carefully considered and the optimized structure, reflecting a full commercial team of 32, including 16 field sales professionals will ensure that we continue to maximize our overall profitability.

Paul: I would also like to recognize our commercial team that has remained dedicated and focused since the spectrum acquisition and express my sincere excitement to work with them going forward I am truly impressed by this team and their dedication to Robo Dom.

Operator: I hope this gives you a clearer picture of why we're excited about this important asset and how we expect to continue to grow our base. I'll also share one final thought on Rolodon, as I know many of you have maintained interest in the potential of Rolodon to be a solution for same-day dosing, an important consideration for clinics and patients. Trial enrollment has accelerated, and we anticipate results later this year. We will provide updates on same-day dosing in the future as information becomes available. With that, I'll turn the call back to the operator for Q&A from our covering panel. The floor is now open to your questions. To ask a question at this time, simply press the star followed by the number one on your telephone.

Paul: I Hope this gives you a clearer picture of why we're excited about this important asset and how we expect to continue to grow our base.

I'll also share one final thought enrollment on as I know many of you have maintained interest and the potential role with them to be a solution for same day dosing and important consideration to clinics and patients.

Paul: Trial enrollment has accelerated and we anticipate results later this year.

We will provide updates on same day dosing in the future as information becomes available.

Speaker Change: With that I'll turn the call back to the operator for Q&A from our covering analysts.

Speaker Change: The floor is now open for your questions to ask a question at this time simply press the star followed by the number one on your telephone keypad.

Thomas Flaten: We'll now take a moment to compile our questions. Our first question comes from the line of Thomas Flaten with Lake Street Capital Markets. Please go ahead. Thanks, I appreciate taking the questions. Paul, maybe I can just start with you.

Speaker Change: We will now take a moment to compile a roster.

Speaker Change: Our first question comes from the line of Thomas Flaten with Lake Street Capital markets. Please go ahead.

Thomas Flaten: Thanks, I appreciate you taking the questions Paul maybe I can just start with you.

Paul Schwichtenberg: You mentioned a reduction, I think in the footprint, I heard 16 reps, but you also mentioned a shift in resources to new customer opportunities. Or, I'm sorry, I'm paraphrasing you there. But could you maybe expand on what exactly that means? Yeah, I think the answer there, Thomas, is that we are trying to align our commercial sales organization to support our existing customer base and allow us the opportunity to be able to expand to new customers. You know, what I would say is that our commercial team has been very focused on cultivating relationships with both existing customers and new customers, and we want to make sure that we're aligned so that we can grow our volume with those existing customers and reach out further to new And maybe some learnings now that you've had the product under your belt for a while. What is it?

Thomas Flaten: You mentioned a reduction I think in the footprint I heard 16 reps, but you also mentioned a shift in resources to new customer opportunities.

Thomas Flaten: Sorry, I'm paraphrasing you there, but could you maybe expand on what exactly that means.

Thomas Flaten: Okay.

Paul: Yes, I think the answer there Thomas is that we are trying to align our commercial sales organization.

Thomas Flaten: To support our existing customer base and allow us the opportunity to be able to expand to new customers.

Thomas Flaten: What I would say is that our commercial team has been very focused on.

Thomas Flaten: Cultivating relationships with both <unk>.

Thomas Flaten: Existing customers add new customers and we want to make sure that we're aligned so that we can.

Thomas Flaten: While our volume with those existing customers and reach out further to the new customers to get them onboard.

Thomas Flaten: And <unk>.

Thomas Flaten: Maybe some learnings now that you've had the product under your belt for awhile what is it.

Thomas Flaten: Is there any profile of customers that are switching to <unk> are there. Some learnings there that you could share with us kind of who is the ideal customer at this point.

Thomas Flaten: I would say the ideal customer are those customers at.

Paul Schwichtenberg: Or is there a profile of customers that are switching to Rollavidon? Are there some learnings there that you could share with us? Kind of who is the ideal customer? I would say the ideal customer is those customers that, I would say, have had challenges in the oncology space in terms of cost and, you know, we bring a value proposition to the table that's important to them. Yeah, and then when you mentioned the new customers, are those still focused on the clinic? Or are you kind of spreading your wings beyond the traditional clinic, which is where Spectrum started? The answer, Thomas, is both.

Thomas Flaten: I would say have had challenges in the oncology space.

Thomas Flaten: In terms of.

Thomas Flaten: Cost.

Thomas Flaten: We bring a value proposition to the table that's important to them.

Thomas Flaten: And then when.

Thomas Flaten: You mentioned the new customers are.

Thomas Flaten: Are those are we still focused on the clinic or are you kind of spreading your wings beyond the traditional clinic, which is where spectrum who started with us.

Thomas Flaten: The answer Thomas as both we've had great success in the clinic. So as I mentioned in my script, we had a 30% market share that we've achieved recently in the clinic space and as I mentioned, we think we can grow that space, but in addition to that we are looking at expanding outside and reaching out to new channels that will help us grow the product.

Paul Schwichtenberg: You know, we've had great success in the clinics. As I mentioned in my script, we have a 30% market share that we achieved recently in the clinic space. And as I mentioned, we think we can grow that space. But in addition to that, we are looking at expanding outside and reaching out to new channels that will help us grow the product. And then, just one final one, if I may ask, significance of the cut beyond the Rolvidon organization? Is there any commentary you can provide on that?

Thomas Flaten: John and then.

Speaker Change: Just one one final one if I may.

Speaker Change: The <unk>.

Speaker Change: Of significance of the cut beyond the <unk> organization.

Speaker Change: Is there any commentary you can provide on that I'm, just trying to understand what the impact to the nonwoven <unk> oriented realizations.

Speaker Change: Are you talking about in terms of the reward.

Speaker Change: Yes, yes, correct sorry, yes.

Speaker Change: It was yes, sorry, Hey, Thomas this is Heather.

Heather: Minimal impact to the rest of the organization it.

Heather Mason: I'm just trying to understand what the impact is on the non-Rolvidon oriented organization. Are you talking about in terms of the RE-ORG? Yes, yes, correct. Sorry. Yeah. It was, sorry.

Heather: It was really a focus of.

Heather: Having the right size for the <unk> go to market work.

Speaker Change: Got it.

Operator: Hey, Thomas, this is Heather. It has minimal impact on the rest of the organization. It was really a focus of having the right size for the role of the Don Go-To-Market work. I appreciate taking the questions. Thank you. Our next question comes from the line of Jim Sidoti with Sidoti and Company. Please go ahead.

Speaker Change: Taking my questions. Thank you.

Speaker Change: Our next question comes from the line of Jim Sidoti with Sidoti and company. Please go ahead.

James Philip Sidoti: Hi, good afternoon, and thanks for taking my questions first can you repeat what was the guidance for operating expense for 2024 understood.

James Philip Sidoti: Yeah, Jim this is a J.

James Philip Sidoti: Hi, good afternoon, and thanks for taking the questions. First, can you repeat what the guidance for operating expenses for 2024 is? Yeah, Jim, this is Ajay.

James Philip Sidoti: Our guidance for EBITDA was $20 million to $30 million and to help you baseline on operating expenses.

James Philip Sidoti: Operating expenses were expecting between 65 and $70 million.

Ajay Patel: So we're, our guidance for EBITDA was $20 to $30 million. And to help you baseline operating expenses, the operating expenses we're expecting between $65 and $70 million. Okay, great. And then? You, uh, you gave an outlet for Robin on to, to, uh, The Gross Sales in Excess of $100 Million. Do you need same-day dosing to be a part of that, or is that outside of same-day? That would be outside of the realm of same-day dosing.

Speaker Change: Okay great.

Speaker Change: And then.

Speaker Change: You gave an outlook for road onto too.

Speaker Change: The gross sales in excess of a $100 million do you need same day dosing to be part of that or is that outside of same day dosing.

Speaker Change: Yes.

Speaker Change: That would be outside of same day dosing.

Speaker Change: So if you do get.

Speaker Change: Some approvals through same day dosing this could be upside to that.

Speaker Change: That would be correct, yes.

Speaker Change: You've talked a lot about world on it.

Paul Schwichtenberg: So, if you do get some approvals for same-day dosing, this could be an upside to that. That would be correct, yeah. You know, you've talked a lot about Worlvidone and Indosyn, but regarding the other drugs in your portfolio, are there any growth drivers there, any of those drugs that you think will be significant growers going forward? Jim, yes, we are looking at our strategy for our other assets, specifically Otrexip and Symposan, and looking for growth drivers there. We are very active on those two products, and we're going to be updating our strategy as we continue to, you know, learn more about the marketplace there and where their opportunities exist, and then, in terms of, I'm sorry. [inaudible] therapeutic area agnostic mindset, but also mindful that we now have an oncology salesforce and a skill set that we'd like to leverage. So we see that as another growth opportunity. That was my next question.

Speaker Change: But regarding the other drugs in your portfolio are there any growth drivers. There are any of those drugs that you think could be significant growth going forward.

Speaker Change: Jamie Yes, we are looking at.

Speaker Change: Our strategy for our other asset specific <unk> and looking forward growth drivers. There. We are very active on those two products and we're going to be updating our strategy as we continue to.

Speaker Change: Learn more about the marketplace, there and where the opportunities exist.

Speaker Change: Alright.

Speaker Change: Then.

In terms.

Speaker Change: I'm sorry.

Speaker Change: That's what they have Jim and in addition, we continue to look for other assets.

Speaker Change: Assets, but our business model both in our I would say more traditional.

Therapeutic area Ignostic mindset, but also mindful that we now have an oncology sales force and a skill set that we'd like to leverage.

Speaker Change: So we see that as another growth opportunity.

Speaker Change: Yes.

Speaker Change: My next question. If you are cash flow positive and if that continues to improve.

Heather Mason: If you are, you know, cashflow positive. If that continues to improve, are there any priorities for cash flow? The, uh, the, uh, you know, murders. Is that right? Or do you think that paid off?

Speaker Change: <unk> cash will be.

Speaker Change: <unk>.

<unk>.

Speaker Change: Mergers is that right or do you think debt pay down.

James Philip Sidoti: I'm sorry, I don't know that I understood the last part of your question, Tim. Well, just talk about what your priorities are, assuming that you are cash flow positive and that continues, you know, into 2025 and beyond. What's the priority for cash? Is it more acquisitions or is it that pay down, or a combination?

Speaker Change: I'm sorry.

Speaker Change: I don't know that I understood. The last part of your question Tim.

Tim: Okay, Let's talk about what your priorities are assuming that you are cash flow positive and that continues into 2025 and beyond.

Tim: Priority for cash is it is it more acquisitions or.

Tim: Debt pay down or a combination.

Heather Mason: Well, our focus is to grow, grow the number of assets that we can put into our business model. So our intention is to continue to add inorganic growth and acquisitions via inorganic means. So acquisition would be our priority.

Tim: Well our focus is to grow grow the number of assets that we can put into our business model. So our intention is to continue to add inorganic growth via inorganic means so acquisition would be our priority.

Heather Mason: All right. I would now like to turn the call over to Heather Mason for her closing remarks. Thank you, and I appreciate those of you who have joined us today. I hope that today's call has given you a clear picture of the excitement and commitment we feel today at Assertio based on our asset platform and the opportunities ahead in 2024, both in terms of the financial outlook and the ability to continue to build our business with both current and potential new assets. We will report our first quarter earnings results in May and keep you apprised of any additional developments. If you'd like to arrange an update call with management, please contact Matt Kreps using his contact information in the press release, and we'll be happy to schedule a time. And thank you all once again. This concludes today's call.

Speaker Change: Got it alright, thank you.

Hesitant Mason: I would now like to turn the call over to hesitant Mason for closing remarks.

Mason: Thank you and I appreciate those of you who have joined us today.

Mason: Hope that today's call is giving you a clear picture of the excitement and commitment we feel today. It is <unk> based on our asset class form and the opportunities ahead in 2024.

Mason: Both in terms of financial outlook and your ability to continue to build our business with both current and potential new assets we have.

Mason: We'll report our first quarter earnings results in May and keep you apprised of any additional developments if you'd like to arrange an update call with management. Please contact my net crap using his info in the press release and will be happy to schedule a time.

Mason: And thank you all once again.

Speaker Change: This concludes today's call you may now disconnect.

Operator: You may now, Please wait; the conference will begin shortly. Please wait; the conference will begin shortly. Please wait; the conference will begin shortly.

Speaker Change: Please wait a conference will begin shortly.

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