Q1 2024 Collegium Pharmaceutical Inc Earnings Call
Operator: Greetings and welcome to the Collegium Pharmaceuticals first quarter 2024 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during this conference, please press star zero on your telephone keypad. Please note that this conference call is being recorded. I will now turn the call over to Christopher James, Vice President of Investor Relations at Collegium. Thank you. You may begin.
Greetings and welcome to the Collegium pharmaceutical first quarter 2024 earnings conference call.
Operator: At this time all participants are in a listen only mode. A question and answer session will follow the formal presentation.
Operator: If anyone should require operator assistance. During this conference. Please press star zero on your telephone keypad.
Operator: Please note that this conference call is being recorded.
Operator: I will now turn the call over to Christopher James Vice President of Investor Relations at Collegium.
Christopher Shayne James: You may begin.
Christopher Shayne James: Welcome to Collegium Pharmaceutical's first quarter 2024 earnings conference call. I'm joined today by Joe Ciaffoni, our Chief Executive Officer; Colleen Tupper, our Chief Financial Officer; and Scott Dreyer, our chief commercial officer.
Christopher Shayne James: Welcome to Collegium Pharmaceuticals, first quarter 2024 earnings conference call.
Christopher Shayne James: I'm joined today by Joseph Pony, our Chief Executive Officer.
Christopher Shayne James: Tucker, our Chief Financial Officer.
Christopher Shayne James: Got Dreyer, our chief commercial officer.
Christopher Shayne James: Mike Heffernan, the chairman of our board, will join us for the Q&A portion of the call. Before we begin today's call, we want to remind participants that none of the information presented today is intended to be promotional, and that any forward-looking statements made today are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Your caution that such forward-looking statements involve risk and uncertainties, including, without limitation, the risk that we may not be able to successfully commercialize our product, that we may incur significant expense in doing so, and that we may not prevail in current or future litigation pertaining to our business.
Christopher Shayne James: Mike Heffernan, the chairman of our board, who joined US for the Q&A portion of the call.
Christopher Shayne James: These risks and other risks of the company are detailed in the company's periodic reports filed with the Securities and Exchange Commission. Our future results may differ materially from our current expectations discussed today. Our earnings press release and this call will include discussion of certain non-GAAP information. You can find our earnings press release, including relevant non-GAAP reconciliations, on our corporate website at collegiumpharma.com. I will now turn the call over to our CEO, Joe Ciaffoni.
Christopher Shayne James: Before we begin today's call we want to remind participants that none of the information presented today is intended to be promotional and that any forward. Looking statements made today are made pursuant to the safe Harbor provision of the private Securities Litigation Reform Act of 1095.
Joseph J. Ciaffoni: You are cautioned that such forward looking statements involve involve risks and uncertainties, including and without limitation. The risks that we may not be able to successfully commercialize our products that we may incur significant expense in doing so and that we may not prevail in current or future litigation pertaining to our business.
Joseph J. Ciaffoni: These risks and other risks of the company are detailed in the company's periodic reports filed with the Securities and Exchange Commission.
Joseph J. Ciaffoni: Our future results may differ materially from our current expectations discussed today are.
Joseph J. Ciaffoni: Our earnings press release, and this call will include discussion of certain non-GAAP information.
Joseph J. Ciaffoni: You can find our earnings press release, including relevant non-GAAP reconciliations on our corporate website at Collegium pharma Dot com.
Joseph J. Ciaffoni: I will now turn the call over to our CEO Joe <unk>. Thank you Chris Good afternoon, and thank you everyone for joining the call today, we will discuss our financial performance during the first quarter and provide an update on our progress in 2024.
Joseph J. Ciaffoni: Thank you, Chris. Good afternoon, and thank you, everyone, for joining the call. Today, we will discuss our financial performance during the first quarter and provide an update on our progress in 2024. At Collegium, we are focused on building a leading, diversified, specialty pharmaceutical company committed to improving the lives of people living with serious medical conditions. We strive to do good as we do well. During the first quarter, in support of our commitment to increase equitable access to STEM education and advance the next generation of life science leaders, we selected the first participants in the Collegium Pharmaceutical Scholarship Program. This new program awards two scholarships to high school seniors pursuing a STEM-related major at a U.S. university.
Joseph J. Ciaffoni: Additionally, at our 2024 National Sales Meeting, we built wagons filled with toys for Nicholas Children's Hospital in Miami, and we began the second year of our partnership with the Boston Red Sox and Science from Scientist. I'd like to recognize the Collegium team for their commitment to our mission and dedication to making a positive impact in the communities we serve. We are encouraged by the strong start to the year. 2024 is on track to be another record year for Collegium as we focus on operational execution to grow our core business and deploy capital to create value for our shareholders.
Joseph J. Ciaffoni: At Collegium, we are focused on building, a leading diversified specialty pharmaceutical company committed to improving the lives of people living with serious medical conditions, we strive to do good as we do well.
Joseph J. Ciaffoni: During the first quarter in support of our commitment to increase equitable access to stem education and advance. The next generation of life Science leaders. We selected the first participants in the Collegium pharmaceutical scholarship program.
Joseph J. Ciaffoni: This new program awards to scholarships the high school seniors pursuing a stem related major at a U S University.
Joseph J. Ciaffoni: Additionally, at our 2024 National sales meeting, we built wagons filled with toys for Nicklaus Children's hospital in Miami, and we begin the second year of our partnership with the Boston Red Sox and science from scientists.
Joseph J. Ciaffoni: I'd like to recognize the Collegium team for their commitment to our mission and dedication to making a positive impact in the communities we serve.
Joseph J. Ciaffoni: We are encouraged by the strong start to the year.
Joseph J. Ciaffoni: 2024 is on track to be another record year for Collegium as we focus on operational execution to grow our core business and deploying capital to create value for our shareholders.
Joseph J. Ciaffoni: Looking beyond 2024, key accomplishments across the pain portfolio, including growing momentum for Bell Buca, a successful contracting strategy for Expamsa ER, and the recently announced authorized generic agreement for the Nucinta franchise, meaningfully improve our outlook for 2025 and beyond.
Joseph J. Ciaffoni: Looking beyond 2024 key accomplishments across the pain portfolio, including growing momentum for BELBUCA are successful contracting strategy for <unk> ER and the recently announced authorized generic agreement for the NUCYNTA franchise meaningfully improve our outlook for 2025 and.
Joseph J. Ciaffoni: Beyond <unk>.
Joseph J. Ciaffoni: I am proud of the success that the Collegium team has achieved over the years. We've delivered consistently strong financial performance with a track record of growing the top and bottom lines, executing value-creating acquisitions, and being good stewards of capital. Collegium has an exceptional company culture with a team committed to making a positive impact on the communities we serve. With a healthy balance sheet, a disciplined capital deployment strategy, and strong leadership, the company is well positioned for future growth.
Joseph J. Ciaffoni: I am proud of the success that the Collegium team has achieved over the years, we have delivered consistently strong financial performance with a track record of growing the top and bottomline executing value, creating acquisitions and being good stewards of capital.
Joseph J. Ciaffoni: Collegium has an exceptional company culture with a team committed to making a positive impact on the communities we serve.
Joseph J. Ciaffoni: With a healthy balance sheet disciplined capital deployment strategy and strong leadership the company is well positioned for future growth.
Joseph J. Ciaffoni: Earlier today, we announced that I will be stepping down as President and Chief Executive Officer of the company. To ensure a seamless transition, Mike Heffernan will serve as interim president and CEO until a new CEO is appointed. Mike founded Collegium in 2002, served as president and CEO for over 15 years, and is currently the chairman of our board. Given his past leadership at Collegium, he is well suited to lead the company during this transition period.
Speaker Change: Earlier today, we announced that I will be stepping down as president and Chief Executive Officer of the company.
Joseph J. Ciaffoni: To ensure a seamless transition Mike Heffernan will serve as interim president and CEO until a new CEO is appointed.
Joseph J. Ciaffoni: Mike founded Collegium in 2002 served as president and CEO for over 15 years and is currently the chairman of our board.
Joseph J. Ciaffoni: Given his past leadership at Collegium he is well suited to lead the company during this transition period.
Joseph J. Ciaffoni: It has been a privilege to work with many talented and dedicated colleagues at Collegium, and I am extremely proud of all that we have accomplished together. Collegium is in a strong position, both financially and strategically, and I'm confident that we have the right leadership team in place to advance the business forward. I will now hand the call over to Colleen to discuss business highlights and finances.
Joseph J. Ciaffoni: It has been a privilege to work with many talented and dedicated colleagues that Collegium and I am extremely proud of all that we've accomplished together.
Colleen: <unk> is in a strong position, both financially and strategically and I am confident that we have the right leadership team in place to advance the business forward.
Joseph J. Ciaffoni: I'll now hand, the call over to Colleen to discuss business highlights and financials.
Colleen Tupper: Thanks, Joe. Good afternoon, everyone.
Colleen: Thanks, Joe Good afternoon, everyone.
Colleen Tupper: In the first quarter of 2024, we delivered strong financial results, executed our capital deployment strategy, and improved the outlook for our pain portfolio in 2025 and beyond. Key accomplishments and highlights in 2024 include: we accelerated momentum for bilbuca, growing prescriptions 4.2% and revenue 15% in the first quarter compared to the prior year period. We achieved growth to net for Expansa ER of 53.6% in the first quarter, reflecting the immediate impact of the successful contract renegotiations completed last year.
Colleen Tupper: In the first quarter of 2024, we delivered strong financial results executing our capital deployment strategy and improve the outlook for our pain portfolio in 2025 and beyond.
Colleen Tupper: Key accomplishments and highlights in 2024 include we accelerated momentum for BELBUCA growing prescriptions, four 2% and revenue 15% in the first quarter compared to the prior year period.
Colleen Tupper: We achieved gross to net for <unk> of 53, 6% in the first quarter, reflecting the immediate impact of the successful contract renegotiations completed last year we.
Colleen Tupper: We strategically deployed capital and strengthened our balance sheet with the redemption of the remaining $26.4 million of our convertible senior notes due in 2026. Additionally, our board authorized a $35 million accelerated share repurchase program, reinforcing our commitment to leveraging our $150 million share repurchase program to return capital to our shareholders. We entered into an agreement with Hikma Pharmaceuticals to distribute authorized generics of Nucenta and Nucenta ER, meaningfully improving our outlook for 25 and beyond. Additionally, we presented four scientific posters at the American Academy of Pain Medicine annual meeting in March and sponsored a CME program.
Colleen Tupper: We strategically deployed capital and strengthened our balance sheet with the redemption of the remaining $26 $4 million of our convertible senior notes due in 2026.
Colleen Tupper: Our board authorized a $35 million accelerated share repurchase program reinforcing our commitment to leveraging our $150 million share repurchase program to return capital to our shareholders.
Colleen Tupper: We entered into an agreement with Hikma pharmaceuticals to distribute authorized generics of NUCYNTA and NUCYNTA ER meaningfully improving our outlook in 'twenty five and beyond.
Colleen Tupper: And we presented for scientific posters at the American Academy of Pain Medicine annual meeting in March and sponsored a CME programs.
Colleen Tupper: Our focus in 2024 is on operational execution. We are on track to deliver record financial performance and deploy capital to rapidly pay down debt and return value to shareholders by opportunistically leveraging our share repurchase program. We delivered record Belbuco revenue, driven by strong prescription growth of 4.2% year-over-year. We expect Belbuco revenue growth in 2024 to be fueled by full-year prescription growth. Additionally, we expect Exstansa ER revenue growth to be driven by gross-to-net improvements.
Colleen Tupper: Our focus in 2024 is on operational execution, we are on track to deliver record financial performance and deploy capital to rapidly pay down debt and return value to shareholders by Opportunistically, leveraging our share repurchase program.
Colleen Tupper: We delivered record BELBUCA revenue driven by strong prescription growth of four 2% year over year.
Colleen Tupper: We expect BELBUCA revenue growth in 2024 to be fueled by full year prescription growth. Additionally, we expect <unk> revenue growth to be driven by gross to net improvement.
Colleen Tupper: The Nucinta franchise is a key contributor to our pain portfolio. As expected, we saw pressure on Nucinta franchise revenue in the first quarter due to the elimination of the Medicaid cap by the American Recovery and Reinvestment Act. On a full-year basis, we expect some pressure on the new SINTA franchise's year-over-year revenues, with a return to relative year-over-year stability in 2025. The 2025 and beyond outlook for our pain portfolio continues to improve. The Medicare Part D redesign will serve as a tailwind for our pain portfolio, in particular for extensa ER. The new patient population exclusivity for NuSyntha in pediatrics, granted in August 2023, was a significant event. We expect to receive a six-month pediatric extension for the NuSyntha franchise in the second half of this year.
Colleen Tupper: <unk> Center franchise is a key contributor to our pain portfolio as expected we saw pressure on NUCYNTA franchise revenue in the first quarter due to the elimination of the Medicaid capped by the American Recovery Act.
Colleen Tupper: On a full year basis, we expect some pressure on the NUCYNTA franchise year over year revenues with a return to relative year over year stability in 2025.
Colleen Tupper: The 2025 and beyond outlook for our pain portfolio continues to improve the Medicare part D redesign will serve as a tailwind for our pain portfolio in particular for extensor ER.
Colleen Tupper: The new patient population exclusivity for NUCYNTA in Pediatrics granted in August 2023 was a significant event, we expect to receive a six months pediatric extension for the NUCYNTA franchise in the second half of this year.
Colleen Tupper: In addition, we recently selected Hikma Pharmaceuticals to be our authorized generic partner for Nucinta and Nucinta ER, and that agreement further bolsters the value of the franchise. Finally, under the terms of our license of the Orange Book listed patents that support the Nucenta franchise, we expect our royalty obligations to decrease from 14% to 7% in July of 2025 and then to zero upon the launch of the first authorized generic listing. The competitive landscape relative to Bilbucca has also improved with CHEMO's announcement that for the fourth time, the FDA has issued a complete response letter for its generic formulation of Bilbucca.
Colleen Tupper: In addition, we recently selected Hikma pharmaceuticals to be our authorized generic partner for NUCYNTA and NUCYNTA ER and that agreement further bolsters the value of the franchise.
Colleen Tupper: Finally under the terms of our license of the Orange book listed patents that support the NUCYNTA franchise, we expect our royalty obligations to decrease from 14% to 7% in July of 2025, and then two zero upon the launch of the first authorized generic with Hikma.
Colleen Tupper: The competitive landscape relative to BELBUCA has also improved with Chinas announcement that for the fourth time, the FDA issued a complete response letter for their generic formulation of BELBUCA.
Colleen Tupper: Following a banner 2023, we further strengthened our financial position in the first quarter of 2024 through record Belbuca revenue, managed operating expenses, and another quarter of robust cash flows, strengthening our balance. Financial highlights for the first quarter include: Net product revenues were $144.9 million in the first quarter, relatively flat year-over-year. Bill Buchan net revenue was a record $50.7 million, up 15% year-over-year. Ex-SAMHSA ER net revenue was $45.8 million, down 4% year-over-year, and Ex-SAMHSA growth to net was $53.6 million.
Colleen Tupper: Following a banner 2023, we further strengthened our financial position in the first quarter of 2024 through record BELBUCA revenue managed operating expenses and another quarter of robust cash flows strengthening our balance sheet.
Colleen Tupper: Highlights for the first quarter include.
Colleen Tupper: Net product revenues were $144 9 million in the first quarter relatively flat year over year BELBUCA.
Colleen Tupper: BELBUCA net revenue was a record $50 7 million up 15% year over year.
Colleen Tupper: <unk> ER net revenue was $45 8 million down 4% year over year and extensive gross to net was 53, 6%.
Colleen Tupper: As a reminder, GrossDNAT is generally more favorable in the first quarter of each year due to the lower coverage gap expense, also known as the donut hole in Medicare coverage. As we move through the year, gross to net is expected to be less favorable in the second and third quarters and improve sequentially in the fourth quarter. Looking forward to 2025 with the Medicare Part D redesign, this dynamic will change, and Exstensa ER will benefit from the phase-in period for small manufacturing. We expect the full year EXTAMSA ER gross to net to be between 56 and 58 percent, which is an improvement from 59.6% in 2020. This inter-franchise net revenue was $45.1 million, down 8% year-over-year.
Colleen Tupper: As a reminder, gross to net is generally more favorable in the first quarter of each year due to the lower coverage GAAP expense also known as the donut hole in Medicare coverage as we move through the year gross to net are expected to be less favorable in the second and third quarters and improved sequentially in the fourth quarter.
Colleen Tupper: Looking forward to 2025 with the Medicare part D. Redesign this dynamic will change and extends to ER will benefit from the phase in period for small manufacturers.
Colleen Tupper: We expect the full year <unk> gross to net to be between 56% to 58% this year.
Colleen Tupper: Which is an improvement from 59, 6% in 2023.
Colleen Tupper: NUCYNTA franchise net revenue was $45 1 million down 8% year over year.
Colleen Tupper: Gap operating expenses were $42 million, down 20% year-over-year, and adjusted operating expenses were $34.5 million, down 10% year-over-year. Net income for the first quarter was $27.7 million compared to a net loss of $17.4 million in the prior year period. Non-GAAP-adjusted EBITDA was $92.4 million, up 5% year-over-year. Gap earnings per share was $0.86 basic and $0.71 diluted in the first quarter compared to gap loss per share of $0.51 basic and diluted in the prior year period. Non-GAAP-adjusted earnings per share was $1.45 in the first quarter, up 10% year-over-year.
Colleen Tupper: GAAP operating expenses were $42 million down 20% year over year, and adjusted operating expenses were $34 5 million down 10% year over year.
Colleen Tupper: Net income for the first quarter was $27 $7 million compared to a net loss of $17 $4 million in the prior year period.
Colleen Tupper: non-GAAP adjusted EBITDA was 90, $92 4 million up 5% year over year.
Colleen Tupper: GAAP earnings per share was <unk> 86, basic and <unk> 71 diluted in the first quarter compared to GAAP loss per share of 51.
Colleen Tupper: Basic and diluted in the prior year period.
Colleen Tupper: non-GAAP adjusted earnings per share was $1 45 in the first quarter up 10% year over year.
Colleen Tupper: Please see our press release issued earlier today for a reconciliation of GAP to non-GAP. As of March 31st, we had $318 million in cash, cash equivalents, and marketable securities. We generated another quarter of strong cash flows, enabling us to execute on our capital deployment strategy. With our strong financial performance in the first quarter, we're reaffirming our 2024 Financial Guide. We expect net product revenues in the range of $580 to $595 million. We expect adjusted operating expenses in the range of $120 to $125 million, and adjusted EBITDA in the range of $380 to $395 million.
Colleen Tupper: Please see our press release issued earlier today for a reconciliation of GAAP to non-GAAP results.
Colleen Tupper: As of March 31, we had $318 million in cash cash equivalents in marketable securities. We generated another quarter of strong cash flows, enabling us to execute on our capital deployment strategy.
Colleen Tupper: With our strong financial performance in the first quarter, we are reaffirming our 2024 financial guidance, we expect net product revenues in the range of $580 million to $595 million. We expect adjusted operating expenses in the range of $120 million to $125 million.
Colleen Tupper: And adjusted EBITDA in the range of $380 million to $395 million.
Colleen Tupper: We are confident in our ability to deliver on our financial commitments in 2024. Our outlook in 2025 and beyond has improved as well, given the Medicare Part D redesign that will serve as a tailwind to our portfolio, our new SINTA franchise authorized generic agreement, the anticipated reduction in royalties paid on new SINTA franchise net sales, and the improving competitive landscape for Belle Butte. These positive developments increase the value of our pain portfolio as well as the intrinsic value of our company. We remain focused on creating long-term value for our shareholders through our capital deployment strategy. We are locked into rapidly deleveraging the balance sheet.
Colleen Tupper: We are confident in our ability to deliver on our financial commitments in 2024, our outlook in 2025 and beyond has improved as well given the Medicare part D redesign that will serve as a tailwind to our portfolio. Our NUCYNTA franchise authorized generic agreement the anticipated reduction in royalties paid on NUCYNTA franchise.
Colleen Tupper: <unk> net sales and the improving competitive landscape for BELBUCA.
Colleen Tupper: These positive developments increase the value of our pain portfolio as well as the intrinsic value of our company.
Colleen Tupper: We remain focused on creating long term value for our shareholders through our capital deployment strategy.
Colleen Tupper: We are locked into rapidly deleveraging the balance sheet to date, we have repaid $283 $3 million of the pharma compound inclusive of $45 $8 million in the first quarter ending the quarter with net debt to adjusted EBITDA of less than one times in.
Scott Dreyer: To date, we have repaid $283.3 million of the Pharmacon loan, inclusive of $45.8 million in the first quarter, ending the quarter with net debt to adjusted EBITDA of less than one time. In addition, the call option on our 2026 convertible notes was triggered by our strong stock performance, enabling us to redeem the $26.4 million total principal amount of the notes in all cash. We expect that transaction to settle in. This strategic use of our capital strengthens our balance sheet by reducing debt, positively impacting full-year diluted APS, and potentially reducing some technical short positions in our stock.
Scott Dreyer: In addition, the call option on our 2026 convertible notes was triggered by our strong stock performance, enabling us to redeem the $26 4 million dollar total principal amount of the notes and all cash we expect that transaction to settle in June this strategic use of our capital strengthens our.
Scott Dreyer: Our balance sheet by reducing debt positively impacting full year diluted EPS and potentially reducing some technical short positions in our stock.
Scott Dreyer: We expect to repay an additional $137.5 million of the Pharmacon loan in the remainder of 2024, which would put us at a de minimis net debt to adjust the EBITDA ratio at year end. We have a strong track record of returning value to our shareholders through share repurchase and are committed to opportunistically leveraging our $150 million share repurchase program as part of our capital deployment strategy. The recently announced $35 million accelerated share repurchase program reflects our confidence in the strength of the business, which was recently bolstered by the positive developments related to our pain portfolio.
Scott Dreyer: We expect to repay an additional $137 $5 million of the Pharmacon loan and the remainder of 2024, which would put us at a de minimis net debt to adjusted EBITDA ratio at year end.
Scott Dreyer: Okay.
Scott Dreyer: We have a strong track record of returning value to our shareholders through share repurchases and are committed to opportunistically, leveraging our $150 million share repurchase program as part of our capital deployment strategy the.
Scott Dreyer: The recently announced $35 million accelerated share repurchase program reflects our confidence in the strength of the business, which was recently bolstered by the positive developments related to our pain portfolio.
Scott Dreyer: We believe that there continues to be a disconnect between the intrinsic value of the company and our share price, which enables us to continue to opportunistically return value to our shareholders by leveraging our share repurchase program. I will now turn it over to Scott to give a commercial update.
Scott Dreyer: We believe that there continues to be a disconnect between the intrinsic value of the company and our share price, which enables us to continue to opportunistically return value to our shareholders by leveraging our share repurchase program.
Scott Dreyer: I will now turn it over to Scott to give the commercial update.
Scott Dreyer: Thanks Colleen.
Scott Dreyer: At Collegium, we're proud to be the leader in responsible pain management and to offer a differentiated portfolio of products for the treatment of pain. Belbuca, Expansa ER, and Nucinta ER have a combined 50% share of the branded ER market, demonstrating the ongoing strength and reach of our portfolio. Our commercial organization is dedicated to making a positive impact on the lives of people living with pain in the communities we serve. Bell Buicka and Extamsa ER are well positioned for growth this year, and the NuCynta franchise continues to be a key contributor.
Scott Dreyer: Ah Collegium, we're proud to be the leader in responsible pain management and to offer a differentiated portfolio of products for the treatment of pain BELBUCA extends to ER and NUCYNTA ER have a combined 50% share of the branded ER market, demonstrating the ongoing strength and reach of our portfolio.
Scott Dreyer: Our commercial organization is dedicated to making a positive impact on the lives of people living with pain and the communities. We serve BELBUCA and extends to ER are well positioned for growth this year and the NUCYNTA franchise continues to be a key contributor.
Scott Dreyer: We accelerated momentum for Belbuca in the first quarter. We achieved year-over-year Belbuca prescription growth of 4.2% during a time period where we have historically seen a decline in prescription volume due to typical first quarter dynamics where deductibles reset and out-of-pocket costs increased for patients.
Scott Dreyer: We accelerated momentum for <unk> in the first quarter, we achieved year over year BELBUCA prescription growth of four 2% during a time period, where we have historically seen a decline in prescription volume due to typical first quarter dynamics, where deductibles reset and out of pocket cost increase for patients.
Scott Dreyer: We're encouraged by these positive prescription trends and the impact of our strong commercial execution. We believe Schedule 3 products should be used before Schedule 2 and used more broadly. Belbuca is uniquely positioned because of its clinical differentiation as a Schedule 3 product with a broad range of doses for the management of severe and persistent pain that requires an extended treatment period.
Scott Dreyer: We're encouraged by these positive prescription trends and the impact of our strong commercial execution.
Scott Dreyer: We believe schedule III products should be used before scheduled to end used more broadly BELBUCA.
Scott Dreyer: BELBUCA is uniquely positioned because of its clinical differentiation as a schedule III product with a broad range of doses for the management of severe and persistent pain that requires an extended treatment period.
Scott Dreyer: Our commercial team remains focused on delivering this message to healthcare professionals and strengthening execution. Our priorities for Belbuca include strengthening Belbuca's strong commercial access, improving push-through in Medicare Part D, and expanding Medicare Part D coverage. Belbuca revenue growth in 2024 is expected to be driven by prescriptions. In the first quarter, as expected, we saw pressure on prescriptions driven by plans where Extamsa ER was removed from formulary on January 1st after our contract renegotiation, as well as by the typical first quarter dynamics.
Scott Dreyer: Our commercial team remains focused on delivering this message to health care professionals and strengthening execution.
Scott Dreyer: Our priorities for BELBUCA include pulling through BELBUCA is strong commercial access improving pushed through in Medicare part D and expanding Medicare part D coverage.
Scott Dreyer: BELBUCA revenue growth in 2024 is expected to be driven by prescription growth.
Scott Dreyer: In the first quarter as expected we saw pressure on prescriptions driven by plans where extends to ER was removed from formulary on January one after our contract renegotiations as well as by the typical first quarter dynamics.
Scott Dreyer: We are encouraged that after the initial impact on prescriptions from those events prescription trends are showing signs of stabilization beginning in March.
Scott Dreyer: We're encouraged that after the initial impact on prescriptions from those events, prescription trends are showing signs of stabilization beginning in March. Our priorities for Expanse to ER for the remainder of 2024 are clear. We're focused on stabilizing eXtamsa-ER prescriptions by educating physicians on eXtamsa-ER's differentiated label and pulling through eXtamsa-ER's strong access position in commercial and Part D plans. Our aspiration is to replace OxyContin utilization for appropriate patients. Importantly, we now have the gross to net headroom to secure new payer wins, which is a priority moving forward. The Nucenta franchise is a key contributor to our paying portfolio. Cipentadol is a differentiated molecule with a proposed dual mechanism of action.
Scott Dreyer: Our priorities for extends to ER for the remainder of 2024 clear.
Scott Dreyer: We're focused on stabilizing extends to ER prescriptions by educating physicians on <unk> differentiated label and pulling through extensive E. Our strong access position in commercial and part D plans.
Scott Dreyer: Our aspiration is to replace oxycontin utilization for appropriate patients.
Scott Dreyer: Importantly, we now have the gross to net headroom to secure new payer wins, which is a priority moving forward.
Scott Dreyer: The NUCYNTA franchise is a key contributor to our pain portfolio <unk> is a differentiated molecule with a proposed dual mechanism of action, it's viewed favorably and highly differentiated by health care professionals, our market access strategy and our authorized generic agreement with Hikma enables us to manage the new since.
Scott Dreyer: It's viewed favorably and highly differentiated by health care professionals. Our market access strategy and our authorized generic agreement with HICMA enable us to manage the new SINTA franchise contribution in a relatively stable manner year-on-year beginning in 2025 and beyond. In closing, we're encouraged by our performance in the first quarter and the trends that we're seeing across the pain portfolio. We're focused on achieving our 2024 commercial objectives through operational execution. I'll now turn back the call.
Scott Dreyer: Franchise contribution in a relatively stable manner year on year, beginning in 2025 and beyond.
Scott Dreyer: In closing, we're encouraged by our performance in the first quarter and the trends that we're seeing across the pain portfolio. We're focused on achieving our 2024 commercial objectives through operational execution I will now turn the call back to Joe.
Joseph J. Ciaffoni: Thanks, Scott. Collegium is on track to deliver another year of record financial performance in 2024 while strategically deploying capital to create value for shareholders. Importantly, the outlook for the business in 2025 and beyond continues to meaningfully improve. Collegium is well positioned with a strong leadership team in place to drive future growth and create long-term value. Operator, thank you, and we'll now take questions.
Speaker Change: Thanks, Scott Collegium is on track to deliver another year of record financial performance in 2024, while strategically deploying capital to create value for shareholders importantly, the outlook for the business in 2025 and beyond continues to meaningfully improve co.
Joseph J. Ciaffoni: Collegium is well positioned with a strong leadership team in place to drive future growth and create long term value I will now open the call up for questions operator.
Operator: Thank you, and we'll now conduct our question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we pull for questions. Our first question comes from David Amsellem with Piper Sandler. Please state your question.
Speaker Change: Thank you and we'll now conduct a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad, a confirmation tone will indicate that your line is in the question queue.
Operator: You May press Star two if you would like to remove your question from the queue for participants using speaker equipment. It may be necessary to pick up your handset before pressing the star keys, one moment, please while we poll for questions.
David A. Amsellem: Our first question comes from David <unk> with Piper Sandler. Please state your question.
David A. Amsellem: Hey, thanks. So, just on the transition, I guess I have a couple of questions. Why now, number one? And number two, does this at all signal any change in how you're thinking about business development priorities going forward? Or maybe put differently, does it signal any sort of daylight between how you're thinking about the direction of the company, broadly speaking, versus how the board is thinking about it? I just want to better understand what is driving the change, why now, and what it means for the direction of the company, particularly as it relates to your business development objectives. Thank you.
David A. Amsellem: Hey, Thanks, So just on the transition I guess couple of questions why why now number one.
David A. Amsellem: And number two.
David A. Amsellem: Does this at all.
David A. Amsellem: Signal any change in how youre thinking about business development priorities going forward.
David A. Amsellem: Or maybe put differently.
David A. Amsellem: Does it signal any sort of daylight between how you're thinking about the direction of the company broadly speaking versus how the board is thinking about it I just wanted to better understand.
David A. Amsellem: What is driving the change why now and what it means for.
David A. Amsellem: The direction of the company, particularly as it relates to.
David A. Amsellem: To your business development objectives. Thank you.
Joseph J. Ciaffoni: Sure. So, David, this is Joe.
David A. Amsellem: Sure. So David this is Joe I'll start and then I'll hand, it off to Mike for some comments.
Joseph J. Ciaffoni: I'll start and then I'll hand it off to Mike for some comments. So, first off, in terms of the why now, I think it's really the right time for this leadership transition. The company is in a strong position. It has a very strong culture of committed people. 2024 is on track to be a record financial performance, and the outlook continues to improve for 2025 and beyond. And I think, importantly, we have a very strong and competent management team.
Joe: So first off in terms of the why now.
Joseph J. Ciaffoni: I think it's really the right time for this leadership transition. The company is in a strong position. The company has a very strong culture of committed people 2024 is on track.
Joseph J. Ciaffoni: To be a record financial performance the outlook continues to improve in terms of 2025 and beyond and I think importantly, we have a very strong and confident management team. In addition, I think we're in a unique position by having Mike as our chairman given his history in <unk>.
Joseph J. Ciaffoni: In addition, I think we're in a unique position by having Mike as our chairman, given his history and track record of success with the company, to be able to step in on an interim basis. As it pertains to strategy, what I would emphasize, and I think this is important, the strategy of Collegium is a strategy that was collaboratively developed with the board and the management team, and it's the management team that has been executing that strategy with the full support of the board, so it's in no way indicative of change.
Joseph J. Ciaffoni: <unk> record of success with the company to be able to step in on an interim basis.
Joseph J. Ciaffoni: As it pertains to strategy, what I would emphasize and I think this is important the strategy of Collegium is a strategy that is collab that was collaboratively collaboratively developed with the board and the management team and the management team that has been executing that strategy with the full support of the board.
Joseph J. Ciaffoni: It's in no way indicative of change and with that I'll hand, it off to Mike for any comments that he wants to share.
Joseph J. Ciaffoni: Great, thanks Joe. And David, thanks for the question.
Joseph J. Ciaffoni: And with that, I'll hand it off to Mike for any comments that he wants. Great. Thanks, Joe. And David, thanks for the question.
Speaker Change: Great. Thanks, Joe and David Thanks for the question.
Mike: First I'd like to thank Joe personally and on behalf of the entire board for his tremendous leadership and his many accomplishments as the Collegium CEO for the last six years.
Joseph J. Ciaffoni: First, I'd like to thank Joe personally and on behalf of the entire board for his tremendous leadership and many accomplishments as the Collegium CEO for the last six years. When I stepped down as CEO in 2018 and Joe took the role, I could only hope for the success that he has driven at the company. As Joe said, the company is in a very strong position financially and is poised for the next phase of growth.
Joseph J. Ciaffoni: When I step down as the CEO in 2018 and <unk>.
Joseph J. Ciaffoni: Joe took the role I can only hope for the success that he gets driven at the company.
Joseph J. Ciaffoni: As Joe said the company is in a very strong position financially and is poised for the next phase of growth and the board is confident that our ongoing search process will identify a world class leader that will fill Jos large shoes to take the company in the next phase of growth we are committed to the strategy.
Joseph J. Ciaffoni: And the board is confident that our ongoing search process will identify a world-class leader that will fill Joe's large shoes and take the company to the next phase of growth. We are committed to the strategy. We are committed to the capital deployment strategy, and we are committed to the BD strategy. So that remains unchanged, as Joe articulated.
Joseph J. Ciaffoni: We are committed to the capital deployment strategy and we are committed to the BD strategy. So that remains unchanged as Joe articulated.
Joseph J. Ciaffoni: Okay.
Speaker Change: Great. Thank you.
Speaker Change: Thanks, David.
Timothy Francis Lugo: And our next question comes from Tim Lugo with William Blair. Please state your question.
Joseph J. Ciaffoni: And our next question comes from Tim Lugo with William Blair. Please state your question.
Timothy Francis Lugo: Hey team, this is John on behalf of Tim. Thanks so much for taking our question. So I want to congratulate you on the progress with Bell Buca and I know in the past you've said that that's a little bit more of a complicated product that requires some extra physician education. I'm just wondering if you can give us some idea of how much of that growth you would contribute to the new sales initiative around improving that education, and maybe, as a follow-up, how much more runway do you see for that product overall?
Timothy Francis Lugo: Hey, Tim This is John on for Tim. Thanks, So much for taking our question.
Timothy Francis Lugo: I want to say congrats on the progress with BELBUCA and I know in the past <unk> said that thats, a little bit more of a complicated product that's required some extra physician education.
Timothy Francis Lugo: Just wondering if you can give us some idea of how much of that growth each contribute to the new sales initiative around improving that education.
Timothy Francis Lugo: And maybe as a follow up how much more runway do you see for that product.
Scott Dreyer: Yeah, so John, thanks for the question, and I'll hand those two questions off to Scott. Yeah, thanks, John. I appreciate the question, and yeah, we really are encouraged by the growth.
Timothy Francis Lugo: Yeah. So John Thanks for the question and I'll hand, those two questions off to Scott Yeah. Thanks, Jon I. Appreciate the question, Yes, we really are encouraged by the growth in the first quarter, a four 2% and how the momentum continued to accelerate especially given that the first quarter historically has growth headwinds with one quarter of <unk> dynamic so we're incur.
Scott Dreyer: Scott Dreyer, Collegium Pharmaceutical Inc. We really are encouraged by the growth in the first quarter of 4.2 percent and how the momentum has continued to accelerate, especially given that the first quarter historically has growth headwinds with 1Q dynamics. So we're encouraged by that. It is driven by execution.
Scott Dreyer: <unk> by that it is driven by execution I mean, we put a lot of work and energy into training our team to be as effective as they possibly can be and we will continue to do so and look we expect full year growth, we expect prescription growth to drive revenue growth going forward and we're encouraged by what could be on the horizon.
Scott Dreyer: We put a lot of work and energy into training our team to be as effective as they possibly can be, and we will continue to do so. And look, we expect full-year growth. We expect prescription growth to drive revenue growth going forward, and we're encouraged by what could be on the horizon.
Speaker Change: Thanks Thats helpful.
Speaker Change: Thank you Youre welcome.
Serge D. Belanger: And our next question comes from Serge Belanger with Needham and Company. Please state your question.
Scott Dreyer: And our next question comes from Serge Belanger with Needham <unk> Company. Please state your question.
Serge D. Belanger: Hi, everyone. Good afternoon, and thanks for taking my question. This is John from Perserge. First, regarding the agreement with HICMA, can you provide any kind of context, I guess, beyond potential other generic competitors who might enter the market in the future? And if that does happen, what impact could those other generics could have on your deal with HICMA?
Serge D. Belanger: Hi, everyone. Good afternoon, and thanks for taking my question. This is John on for Serge.
Serge D. Belanger: First regarding the agreement with Hikma can you provide any kind of context.
Serge D. Belanger: I guess beyond into potential other generic competitor issue.
Serge D. Belanger: <unk> entered the market in the future and if that does happen what the what the impact of those other generics could have on.
Serge D. Belanger: Deal with Hikma.
Joseph J. Ciaffoni: Sure. So, John, thanks for the question. I'll start on that and then hand it off to Colleen.
Speaker Change: Sure. So John Thanks for the question I'll start on that and then hand it off the call in I think with the Hikma agreement. One we're really excited to be partnered with an industry leader and well respected.
Joseph J. Ciaffoni: I think with the HICMA agreement, one, we're really excited to be partnered with an industry leader and a well-respected organization. When you look at Nucinta ER, what the HICMA agreement does is it secures a scenario beyond our base case. And as we've talked about in the past, we really want to bring focus to Teva as a domino that transcends the portfolio because whether they launch or not, it will be an interesting event for the organization.
Joseph J. Ciaffoni: Organization.
Joseph J. Ciaffoni: When you look at NUCYNTA ER, what the Hikma agreement does is it secures a scenario beyond our base case.
Joseph J. Ciaffoni: And as we've talked about in the past, we really want to bring focus to Teva as a domino the trends since the portfolio because whether they launch or not.
Joseph J. Ciaffoni: It will be interesting event for the organization to the degree that they don't.
Joseph J. Ciaffoni: To the degree that they don't, what the HICMA agreement enables us to realize the vast majority of our upside economics. And Colleen, I don't know if there's anything that you want to add. Yeah, maybe just building upon that, I would say that this agreement gives us.
Joseph J. Ciaffoni: What the Hikma agreement enables us to realize the vast majority of our upside economics and Colleen I don't know if theres anything that you want to add yes, maybe just building upon that I would say that this agreement gives us the certainty that there is only one potential entrant for NUCYNTA ER before 2028 and Thats Teva.
Colleen Tupper: Yeah, maybe just building on that, I would say that this agreement gives us the certainty that there is only one potential entrant for NuSynta ER before 2028, and that's Teva. And if Teva doesn't launch, we secure nearly all of the value in our upside scenario due to the favorable profit share and the impact on the royal family.
Colleen Tupper: And if Teva doesn't launch we secured nearly all of the value in our upside scenario due to the favorable profit share and the impact on the royalties.
Speaker Change: Great. Thank you.
Speaker Change: Youre welcome.
Leszek Sulewski: Our next question comes from Les Sulewski with Truist Securities. Please state your question.
Colleen Tupper: Our next question comes from Les Sulewski with <unk> Securities. Please state your question.
Leszek Sulewski: Good evening. Thank you for taking the time to answer my questions. On Bill Bucca, how much of that 4.2% script growth was driven by the new Medicare Part D contribution? And then second, as we kind of look into the future of Expansa, agreed negotiations after your successful rounds for the past year or two, would you expect those to be even more favorable or kind of in line and stable as we have progressed? Thank you.
Leszek Sulewski: Good evening. Thank you for taking my questions on BELBUCA.
Leszek Sulewski: How much of that four 2% script growth was driven by the new Medicare part D contribution and then second as we kind of look into the future of <unk> rate negotiations.
Leszek Sulewski: Youre successful rounds for the past year or two.
Leszek Sulewski: Would you expect those to be even more favorable or kind of inline and stable as we have progressed. Thank you.
Scott Dreyer: Yep, so Les, I'm going to hand the Bell Buick question off to Scott.
Speaker Change: Yep, so less I'm going to hand, the BELBUCA question off to Scott Okay, Yes.
Scott Dreyer: Yeah, thanks Les. So yeah, when we look at Belbuca, that win was a million lives, so the vast majority of the growth is actually not driven by that win, because it was a smaller amount of lives that were added. It's mostly through the overall growth of our portfolio, and then Les with regard to...
Scott Dreyer: Yeah. Thanks, Les so yeah. When we look at BELBUCA that win was 1 million lives. So the vast majority of the growth is actually not driven by that win because it was a smaller amount of lives that were added it's mostly through the overall growth of our portfolio. Okay, and then less with regards to extend CER. We're now in a position.
Scott Dreyer: And then, Les, with regard to EXTAMSA ER, we're now in a position, post-having renegotiated 85% of all contracts this cycle, where how EXTAMSA grows year to year will be dependent upon what we accomplish in the payer landscape. So, the first thing I want to emphasize is the confidence we have of EXTAMSA being able to consistently grow revenue each year as we move forward. So, in 2025 and beyond. When you think about the headroom we have, when we report, or when the team reports in November, EXTAMSA growth, you'll then have an understanding whether it will be driven by new plans that drive prescriptions and or renegotiations that also have the potential to improve margins.
Scott Dreyer: Post having renegotiated 85% of all contracts this cycle, where how extensor grows year to year will be dependent upon what we accomplish in the payer landscape. So the first thing I want to emphasize is the confidence we have of expanse of being able to consistently grow revenue.
Scott Dreyer: Each year as we move forward so in 2025 and beyond when you think about the headroom we have when we report or when the team reports in November <unk> growth. You will then have an understanding whether it will be driven by new plans to drive prescriptions and or renegotiations that also have the potential.
Scott Dreyer: To improve margins so it will be a year to year scenario, but the thing that we are confident in is the ability to consistently.
Scott Dreyer: So, it will be a year-to-year scenario, but the thing that we are confident in is the ability to consistently grow revenue. And the one thing I would emphasize is that in 2025, we also get a pretty meaningful benefit from the Medicare Part D redesign, which will serve as a tailwind in particular for EXTAMSA.
Scott Dreyer: Consistently grow revenue and the one thing I would emphasize that that is in 2025, we also get pretty meaningful benefit from the Medicare part D redesign, which will serve as a tailwind in particular FERC Samsung.
Oren Gabriel Livnat: All right, thank you. And our next question comes from Oren Livnott with H.C. Wainwright. Please say your question.
Oren Gabriel Livnat: Alright, thank you.
Oren Gabriel Livnat: And our next question comes from Oren <unk> with H C. Wainwright. Please state your question.
Oren Gabriel Livnat: Thanks, Joe, you segued right into my question there. I was hoping to get a little more clarity around that XtampCR 2025 tailwind. Is that something that can help you renew prescription growth in 2025 and beyond? Or is that indirectly another economic or unit value benefit, similar to what we've seen recently with step-down growth to net?
Oren Gabriel Livnat: Thanks.
Oren Gabriel Livnat: Joe.
Oren Gabriel Livnat: Segway into my question, there I was hoping to get a little more clarity around that.
Oren Gabriel Livnat: Our 2025 tailwind.
Oren Gabriel Livnat: Is that something that can help you re new prescription growth.
Oren Gabriel Livnat: In 2025 and beyond or is that.
Oren Gabriel Livnat: Indirectly another economic our unit value benefits.
Speaker Change: Similar to what we've seen recently with Steph stepped down the gross to net I have a follow up thanks.
Joseph J. Ciaffoni: I have a follow-up question. Thanks.
Joseph J. Ciaffoni: Thanks for the question, Oren. I'll start by saying it's not a prescription benefit dynamic, and I'll hand off to Colleen to explain the impact of the Part B redesign and, in particular, in our portfolio, why it affects the benefits.
Joe: Yes. Thanks.
Joe: Thanks for the question on the I'll start by saying, it's not a prescription benefit dynamic and I'll hand off to calling the explained the impact of the part D redesign in particular in our portfolio why extensive benefits.
Colleen Tupper: Thanks. Thanks for the question, Oren.
Colleen Tupper: Thanks for the question Oren, So yes, the Medicare part D redesign the benefit that we speak about is all in the gross to net so coverage.
Oren Gabriel Livnat: So yeah, the Medicare Part D redesign, the benefit that we speak about is all in the gross to net. So the coverage gap or donut hole as we know it today goes away completely, and manufacturers and payers, in the end, pay a larger proportion, and patient out-of-pocket is limited. With the small manufacturer phase-in, our portion of that payment starts phasing in at 1% and goes up over a number of years, so about seven years in total. So that's what that refers to. It's all a gross to net benefit, and it's associated with the phase-in for small manufacturers starting at 1% and going up from that.
Oren Gabriel Livnat: Coverage gap.
Oren Gabriel Livnat: Nicole as we know it today goes away completely and manufacturers and players in the N pay a larger proportion and patient out of pocket is limited weakness small manufacturer phase in our portion of that payment.
Oren Gabriel Livnat: Phasing in at 1% and goes up to a number of years about seven years through.
Oren Gabriel Livnat: So that's what's after that refers to solid gross to net benefit and its associated with the phase in for small manufacturers starting at one point some drilling up from that.
Oren Gabriel Livnat: So just so I'm clear, philosophically, we're essentially, or at a high level, we're talking about the amount you'd have to pay in as a small company is less than the amount you've been having to cover in the donut hole, essentially.
Oren Gabriel Livnat: So just so im clear philosophically were essentially or just high level, we're talking about the amount you'd have to pay and Thats. A small company is less than the amount you have been having to cover in the donut hole essentially.
Colleen Tupper: That's right. It will be less than what we have to cover this year and then phased back in over a number of years up to the level we pay in 2020.
Oren Gabriel Livnat: Right it will be less than what we have to cover this year and then phased back in over a number of years up to the level, we pay in 2024.
Oren Gabriel Livnat: Okay, and speaking of growth to net, your Q1 extent of growth to net was a little higher than I modeled. I can't speak for what you were expecting. Is it possible that this year is going to have a flatter cadence or a narrower range through the year than maybe we saw last year or two?
Colleen Tupper: Okay.
Oren Gabriel Livnat: And speaking of a question. That's your Q1 extend the gross to net was a little higher than I modeled I can't speak for what you were expecting.
Oren Gabriel Livnat: Is it possible that this year is going to have a flatter cadence or a narrower range than maybe we saw last year or two.
Colleen Tupper: Yeah, first, I would say Expansa is performing in line with our expectations. The Q1 growth came in at 53.6. You will still see in Q2, Q3, that eroded a bit because of the donut hole impact. But you're right, it's not quite as deep of an impact in the quarter. And from a full year perspective, we're guiding to 56 to 58%, which is an improvement over nearly
Speaker Change: Yes at first I'd say extensive is performing in line with our expectation the Q1 gross to net of 53 point.
Colleen Tupper: You will still see in Q2 Q3.
Colleen Tupper: That eroded a bit because of the donut hole impact, but you are right its not quite a different question.
Colleen Tupper: In the quarter.
Colleen Tupper: And from a full year perspective, we're guiding to <unk>, 56% to 58%, which is an improvement over nearly 60% last year.
Oren Gabriel Livnat: Okay, and just, you cut out earlier on the call for me. What were you saying about someone getting a CRL on a generic Belbuco?
Speaker Change: Okay and just.
Speaker Change: You cut out earlier.
Speaker Change: On the call for me.
Speaker Change: What were you, saying about someone getting a CRA all on a generic BELBUCA I'm sorry, Thank you repeat that.
Scott Dreyer: Chemo, which was the third and a filer for Belbuca, has recently received its fourth CRL.
Speaker Change: Yeah channel, which was the third and the filer for BELBUCA has recently received its fourth BRL.
Scott Dreyer: Okay, and there's no fourth or fifth filer, if I recall correctly, so we have clarity. If they're not there, it's just between Teva and an uncertain launch when their time comes, and Alvagen blocked for a long time, correct?
Speaker Change: Okay, and there is no <unk>.
Scott Dreyer: <unk>, if I recall right. So we have clarity.
Scott Dreyer: If they're not they're just between <unk> with certain launch.
Scott Dreyer: When their time comes and allergen blocks for a long time correct.
Scott Dreyer: Block till 2032
Scott Dreyer: While it till 2032.
Scott Dreyer: Yes.
Oren Gabriel Livnat: Thank you so much. And Joe, it's been fun working with you, man.
Speaker Change: Thank you so much and Joe it's been fun working with you Matt.
Joseph J. Ciaffoni: Thanks, Oren. It's been a lot of fun working with you, too.
Joe: Thanks, Oren, it's been a lot of fun working with you too.
Operator: Thank you, and there are no further questions at this time. I will now hand the floor back to Joe Ciaffoni for closing remarks. Thank you.
Speaker Change: Thank you and there are no further questions at this time I will now hand, the floor back to Joe <unk> for closing remarks. Thank you.
Joseph J. Ciaffoni: Thank you everyone for joining the call today. I hope you all have a great evening.
Joseph J. Ciaffoni: Thank you everyone for joining the call today I Hope you all have a great evening.
Operator: Thank you. And with that, we conclude today's conference. All parties may disconnect. Have a good day.
Joseph J. Ciaffoni: Thank you and with that we conclude today's conference all parties may disconnect have a good day.