Q3 2024 ANI Pharmaceuticals Inc Earnings Call
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Speaker Change: Good day, everyone, and welcome to today's A&I Pharmaceuticals, Inc. 3rd Quarter 2024 Earnings Results Call.
Speaker Change: Please note that this call is being recorded. After the speaker's opening remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press the star and the number 1 on your telephone keypad.
Speaker Change: If you would like to withdraw your question, please press star 2. It is now my pleasure to turn the conference over to Lisa Wilson. Please go ahead.
Lisa Wilson: Thank you, Todd. Welcome to A&I Pharmaceutical's Q3 2024 Earnings Results Call.
Lisa Wilson: This is Lisa Wilson, Investor Relations for A&I. With me on today's call are Nikhil Lalwani, President and Chief Executive Officer, Steve Carey, Chief Financial Officer, and Chris Mutz, Senior Vice President and Head of A&I's Rare Disease Business.
Lisa Wilson: You can also access the webcast of this call through the investor section of the A&I website at aanifarmaceuticals.com.
Lisa Wilson: Before we get started, I would like to remind everyone that any statements made on today's conference call that express a belief, expectation, projection, forecast, anticipation, or intent regarding future events and the company's future performance
Lisa Wilson: may be considered forward-looking statements as defined by the Private Securities Litigation Reform Act. These forward-looking statements are based on information available to A&I Pharmaceuticals Management as of today.
Lisa Wilson: and involve risks and uncertainties, including in those noted in our press release issued this morning and our filings with the SEC.
Such forward-looking statements are not guarantees of future performance.
Lisa Wilson: Actual results may differ materially from those projected in the forward-looking statements.
Lisa Wilson: ANI specifically disclaims any intent or obligation to update these forward-looking statements except as required by law.
Lisa Wilson: The archived webcast will be available for 30 days on our website, aanifarmaceuticals.com.
Lisa Wilson: For the benefit of those who may be listening to the replay or archived webcast, this call was held or recorded on November 8, 2024. Since then, A&I may have made announcements related to the topics discussed, so please reference the company's most recent press releases and SEC filings.
Speaker Change: And with that, I'll turn the call over to Nikhil Lalwani.
Thank you for watching. Please subscribe to my channel.
Thank you, Lisa.
Good morning, everyone, and thank you for joining us.
Speaker Change: Today, I'll start by discussing our third quarter performance and highlights.
Speaker Change: You'll then hear from Chris Mutz, A&I's Head of Rare Disease.
Speaker Change: After Chris provides additional color on the progress of this segment of our business, including the integration of Alamera, Steve will review the quarter and our updated guidance in more detail.
Following our remarks, we'll take your questions.
Speaker Change: It's an exciting time here at ANI, and we're continuing to execute well this year against our purpose of serving patients, improving lives.
Speaker Change: In addition, our team delivered record performance during the quarter for our lead rare disease asset corticofen gel and our generics business.
Speaker Change: We also put a new, more efficient and effective capital structure in place and completed the acquisition of Alamera on September 16th.
Speaker Change: As you've heard me outline previously, Alomera is highly synergistic to our rare disease business.
Speaker Change: and we believe our proven commercial execution capabilities can further unlock the potential for alluvium in utique to growing and durable assets as well as accelerate the growth of quartrophin gel in ophthalmology.
Integration remains one of our key
Speaker Change: In particular, we have a 45-person combined ophthalmology sales force who have been cross-training and promoting all three products since mid-October.
Speaker Change: In addition, we have successfully retained talented Alamera employees and taken actions to ensure we are on track to capture $10 million of synergies in 2025.
The Alomera acquisition is transformative for our rare disease business.
Speaker Change: We expect the transaction to create substantial shareholder value, driving $35 to $38 million in adjusted non-GAAP EBITDA in 2025, inclusive of the approximately $10 million of identified cost synergies.
Speaker Change: and High Single-Digit to Low Double-Digit Accretion in 2025 Adjusted Non-Gap EPS.
Speaker Change: In addition, we expect our dedicated ophthalmology team to drive additional cortophant revenues in 2025.
Turning to our third quarter financial performance.
Speaker Change: The company posted another strong quarter, with total revenues of $148.3 million, an increase of 13% over the third quarter of 2023.
Speaker Change: driven by accelerating demand for corticofen gel and continued strong growth for generics.
Speaker Change: Adjusted non-GAAP EBITDA was $35.1 million and adjusted non-GAAP EPS was $1.34.
Speaker Change: Cortofan Gel generated $52.6 million in revenues during the quarter, up 77% over the third quarter of 2023.
Speaker Change: The third quarter represented continued momentum with the highest number of both quarterly new patient starts and unique prescribers since launch in January 2022.
We saw increased demand across all targeted specialties.
Neurology, Rheumatology, Nephrology, Polynology, and Ophthalmology.
Speaker Change: and are pleased to report that the prescribing momentum has continued in the fourth quarter with a number of monthly new cases initiated reaching a record high in October.
Speaker Change: CORTROPHIN remains on a strong multi-year category has returned to growth, and is expected to deliver more than 20% year-over-year growth in 2024.
Speaker Change: In addition, the number of patients on ACTH therapy today is still substantially lower than a few years ago.
Speaker Change: Our generics business delivered another strong quarter, with revenues of $78.2 million, an increase of 11% over the third quarter of 2023.
and 5.4% over the second quarter of 2024.
The solid performance reflected strength in our base business.
coupled with contribution from new product launches.
Speaker Change: During the quarter, we launch five new generics, including some into limited competition markets.
Speaker Change: Our R&D team continues to build momentum with one additional product launched already in Q4 and submission of several new ANDAs in the fourth quarter.
and many more. Thank you. Thank you.
based on our strong third-quarter results.
Speaker Change: the continued momentum across the business and the addition of Illumina Nutique. We're pleased to raise our full year 2024 guidance which Steve will discuss later in the call.
Speaker Change: I'll now turn the call over to Chris Mutz, our head of rare disease, to discuss scortrophin and our new ophthalmology franchise in more detail. Chris?
Chris Mutz: Thank you, Nikhil, and good morning, everyone. I'm looking forward to telling you a bit more about the exciting things happening in our rare disease business.
and of course, Kurt Schroefeld.
Chris Mutz: We were pleased with the strong demand trends for protrofen gel during the third quarter, which included continued momentum in adding new prescribers and robust growth of existing prescribers. Importantly, we saw demand growth across all targeted specialties.
of neurology, rheumatology, nephrology, pulmonology, and ophthalmology.
Chris Mutz: Our ophthalmology sales team in particular drove significant growth in prescriptions and new patient starts in the third quarter.
Chris Mutz: further reinforcing our confidence in the potential of the expanded team, which is now bolstered by the addition of the former Alamira reps and new reps we hired to complete the 45-person integrated ophthalmology sales force.
Speaker Change: As Nikhil mentioned, we believe quatrophen gel remains on a strong multi-year growth trajectory.
Speaker Change: and the company has been taking important steps to further strengthen the cord trophin gel franchise.
over the past 18 months.
Speaker Change: We've launched dedicated sales teams in pulmonology and ophthalmology. And with the Alomira acquisition, we now have an expanded sales team in ophthalmology.
Speaker Change: Moving now to our efforts toward improving patient and physician experience and convenience, we are pleased to announce that we've completed the development of a pre-filled syringe offering for cortisofen gel and submitted a supplemental NDA for FDA approval in late October.
Speaker Change: We believe the pre-filled syringe will provide further benefits to patients and physicians by reducing the steps needed for self-administration and are excited about the potential for this new offering that we plan to launch in the first half of 2025.
Speaker Change: We are also exploring other ideas to enhance the convenience for patients starting on clortrofen gel and the health care providers who treat them.
Speaker Change: And as a reminder, in the fourth quarter of 2023, we introduced the one milliliter version of corticofen gel to meet the needs of physicians who desired a smaller configuration of ACTH for certain patients.
Speaker Change: In particular, those with acute gouty arthritis flares for which corticofen gel is the only approved ACTH therapy.
Speaker Change: Physician demand for the 1 ml vial has steadily ramped up, including in the third quarter.
Speaker Change: We're also continuing to invest in scientific research that will provide additional support for the use of cortifolan gel.
at the end of October.
Speaker Change: We presented two abstracts at the American Society of Nephrology Annual Meeting. And earlier in Q3, Research with Cortofan Gel was published in Frontiers in Pharmacology, authored by Ruizhang Gong from the University of Toledo, with collaborators.
Speaker Change: Overall, ANI believes in and remains committed to investing behind cortisofen and delivering strong multi-year growth through purified cortisofen gel.
Turning now to the Alomera products.
Speaker Change: We are as excited as ever about the potential for our combined rare disease team to accelerate growth of alluvian, utique, and corticofringel with retina and uveitis specialists, along with additional targeted ophthalmology subspecialties.
Speaker Change: As a reminder, Eluvian is used to treat diabetic macular edema, or DME, the leading cause of vision loss in diabetic patients, and Utique is used to treat chronic, non-infectious uveitis affecting the posterior segment, or NIUPS.
Speaker Change: Both products are differentiated as long-term treatment options compared to other available products on the market.
Thank you.
Speaker Change: ANI has continued to make progress on the clinical studies, New Day and Synchronicity, which are ongoing for Louvian and UT.
Speaker Change: New Day has the potential to expand the utilization of alluvion for patients with early DME by investigating combination therapy consisting of alluvion and supplemental anti-anxiety treatment to improve patient outcomes.
We expect top-line data in the second quarter of 2025.
Speaker Change: The study is a multi-center, single mass, randomized, and controlled trial designed to demonstrate the efficacy of alluvion as baseline therapy.
Speaker Change: and patients by comparing alluvion plus supplemental anti-vegetative therapy to the current standard of care, anti-vegetative therapy alone.
Speaker Change: The New Day study was initiated in 2020 and is fully enrolled with 306 treatment-naive or almost-naive VME patients in approximately 42 sites around the U.S.
Speaker Change: The planned treatment period in the study is 18 months, with the last patient, last visit in this study projected for next month. Having just attended the American Academy of Ophthalmology meeting in Chicago in mid-October, it's very clear that this data is highly anticipated by the retina specialist community.
Speaker Change: Synchronicity, the study designed to provide retina and uveitis specialists with a broader sense of the utility of UT in patients with chronic NIUPS.
Speaker Change: The study is a multi-center, open-label study evaluating UTIs and chronic inflammation.
Speaker Change: The study has enrolled 110 patients in approximately 25 sites around the U.S., with the last patient last visit for this study projected for November 2025.
Speaker Change: Overall, the integration has been relatively seamless, and we're not only excited about the product, but also impressed by the caliber of talent that we welcomed into ANI.
Speaker Change: Integration and cross-training of the Legacy ANI and Alamera ophthalmology sales reps is complete and a combined team of 45
began promoting corticofragil, eluvian, and etc. to physicians in mid-October.
Speaker Change: We expect the Enhance team to drive greater awareness of all three products and the identification of more patients that can benefit from treatment.
Speaker Change: In 2025, we expect ANI's rare disease business will be both the company's largest business unit and the largest driver of growth, and we look forward to keeping you updated on our progress.
Speaker Change: With that, I'll turn the call over to Steve for the financial update. Steve?
For more information visit www.FEMA.gov
Thanks, Chris, and good morning to everyone on the call.
Speaker Change: I'll review our third quarter results and then discuss our updated 2024 guidance.
Speaker Change: A&I generated third quarter revenues of $148.3 million, up 13% over the prior year period.
Speaker Change: Revenues from Cortofan Gel reported in our rare disease segment were 52.6 million, up 77% from the prior year period, driven primarily by increased volume on a record number of new patient starts.
Speaker Change: Based upon the continued strong execution of the rare disease team in driving growth, we are raising our full-year clotrophin gel revenue guidance.
to 196 million to 200 million.
Speaker Change: The acquisition of Alamera closed on September 16th and therefore our third-quarter financial statements reflect approximately two weeks of revenue and expense activity.
Speaker Change: We are reporting combined revenues from these products under the heading Alluvion and Utique, which contributed 3.9 million of revenues to our rare disease segment during the two-week period.
Speaker Change: Revenues for our generics, established brands, and other segments were $91.9 million, a decrease of 10% over the prior year period.
Speaker Change: Generic revenues for the quarter were 78.2 million, an increase of 11% over the prior year period, driven by increased volumes on contributions from new product launches in 2024 and the full year impact of products launched in 2023.
Speaker Change: Net revenues for established brands and other were $13.7 million in the quarter, a decrease of 57% over the prior year, which was in line with our expectations.
Thank you for watching.
Speaker Change: Starting today, when I speak to our operating expenses for purpose of this earnings call, I will be referring to our non-GAAP expenses, which are detailed on table 3 in our press release.
Speaker Change: Generally, our non-GAAP operating expense excludes depreciation and amortization, stock-based compensation, and certain costs related to litigation and M&A activity.
Please refer to Table 3 for a
Speaker Change: Non-GAAP cost of sales, excluding depreciation and amortization, increased 25% to $59.5 million in the third quarter of 2024 compared to the prior year period.
Speaker Change: primarily due to net growth in sales volumes of pharmaceutical products and significant growth of royalty-bearing products.
Speaker Change: Non-GAAP gross margin was 60%, a decrease of approximately 3.9 points from the prior year period.
Speaker Change: primarily driven by unfavorable product mix due to the reduction in established brand revenues.
Speaker Change: Non-GAAP research and development expenses decreased 20% to $8.7 million in the third quarter of 2024, principally due to the timing of spend.
Speaker Change: We continue to expect second-half 2024 R&D expenditures to be meaningfully higher than the first half of the year due to the timing of activities and the inherent phasing of R&D on a quarter-by-quarter basis.
Speaker Change: In addition, fourth quarter R&D spend will include expenditures for Alluvion and Utique, driven primarily by the New Day and Synchronicity Studies.
Speaker Change: Expenditures related to these studies are expected to continue throughout 2025.
Speaker Change: Non-GAAP selling, general, and administrative expenses increased 23% to $45 million in the third quarter of 2024.
Speaker Change: Due to increased employment related costs, continued investment in rare disease sales and marketing activities, and an overall increase in activities required to support the growth of our business.
Speaker Change: We expect these expenses to be meaningfully higher in the fourth quarter reflecting a full quarter of our integrated ophthalmology sales force promoting Clotrophin, Alluvian, and Utique.
Speaker Change: We expect continued investment in our business and corresponding expenses to support the expanded sales force to continue in 2025.
Speaker Change: Adjusted non-GAAP diluted earnings per share was $1.34 for the quarter, compared to $1.27 per share in the prior year period.
Speaker Change: adjusted non-GAAP EBITDA for the third quarter was $35.1 million compared to $36.5 million in the prior year period.
Speaker Change: We ended the quarter with $145 million in non-restricted cash and have $641.3 million in principal value of outstanding debt, inclusive of our senior convertible notes and term loan.
Speaker Change: At the end of the third quarter, our gross leverage was approximately 3.8 times
and our net leverage was approximately three times.
are trailing 12-month adjusted non-gap EBITDA.
Speaker Change: of approximately $167.7 million, which is pro forma for the Alomera acquisition, inclusive of run rate synergies.
Turning to our updated 2024 outlook.
Speaker Change: We're pleased to have closed the acquisition of Alomera and are raising our full year 2024 guidance to reflect continued strength in purified cotrophin gel and the contribution from Alluvion and Utique starting September 16th.
Our updated guidance is as follows.
Speaker Change: Full year 2024 net revenues of $594 million to $602 million.
Speaker Change: up from our prior guidance of $540 million to $560 million, representing year-over-year growth of approximately 22 to 24 percent.
Speaker Change: for trophy net revenues of $196 million to $200 million up from our prior guidance of $185 million to $195 million representing growth of 75 to 78 percent.
Speaker Change: Combined Alluvian and Utique Net Revenues of $30 million to $32 million, which reflects revenues during the post-close period of September 16th through December 31st.
Speaker Change: Adjusted non-GAAP EBITDA of $149 million to $153 million, up from our prior guidance of $140 million to $150 million, representing growth of approximately 11 to 14 percent.
Speaker Change: and adjusted non-GAAP earnings per share between $4.90 and $5.05 up from our prior guidance of $4.38 and $4.82.
Speaker Change: We now expect total company non-GAAP gross margin to be at the high end of our previously communicated range of between 61 and 62 percent.
Speaker Change: With the inclusion of SG&A and R&D associated with Illuvium and Utique.
Speaker Change: We anticipate full-year total adjusted non-GAAP operating expenses for 2024 of between $219 million and $223 million.
Thank you.
Speaker Change: Consisting with previous quarters, we will continue to tax-effect non-GAAP adjustments
Speaker Change: for the computation of adjusted non-gap diluted earnings per share using our estimated statutory rate of 26% unless the item being adjusted is non-tax deductible in whole or part.
Speaker Change: The company now anticipates approximately 19.7 million and 19.9 million shares outstanding.
Speaker Change: for the purpose of calculating adjusted non-gap diluted EPS for the full year 2024 and fourth quarter 2024, respectively.
Speaker Change: The company also expects its annual U.S. GAAP effective tax rate to be in the mid-single digits as compared to our previous expectation between 22 and 25 percent.
Speaker Change: driven by the non-deductible nature of certain expenses incurred in conjunction with the acquisition of Alomera applied against an annual forecasted gap pre-tax loss.
With that, I'll turn the call back to Mikhail.
Thank you, Steve.
Mikhail: The continued strong performance of our business in the third quarter underscores the strength of our strategy and highlights our solid execution.
Mikhail: And we're excited about the potential of the new expanded rare disease business.
Mikhail: We now have multiple growing and durable commercial rare disease assets and an augmented sales team covering the specialties of ophthalmology, neurology, nephrology, rheumatology and pulmonology.
Mikhail: We look forward to seeing many of you in person later this month at the Guggenheim.
Mikhail: at Guggenheim's Inaugural Healthcare Innovation Conference in Boston and the Jeffries London Healthcare Conference.
Mikhail: Thank you all for joining us today. Operator, please open the line for questions.
Speaker Change: The floor is now open for your questions. If you have a question or comment at this time, please press star 1 on your telephone keypad. You may remove yourself by pressing star 2. Again, to ask a question, please press star 1.
Speaker Change: Our first question will come from David Emslom with Piper Sandler. Please go ahead.
Thanks. So, I have a couple of questions. First...
Speaker Change: Can you talk about the payer landscape for Cordycephalin gel and how...
how that looks.
Speaker Change: compared to AxarGel, so that's number one. Number two is, you've talked about the ACTH market returning to growth, but I'm wondering out loud how much of your business...
is coming from practitioners who are moving away.
Speaker Change: from Act-R-Gel versus practitioners who are just new to the category. So can you help us understand the mix there for your product?
Speaker Change: And then lastly, on the generics business, you've had a steady cadence of new launches. I guess my question here is, what does that mean for 25? How are you thinking about the pace of new launches and the extent to which you can continue to grow your generics business moving forward? Thank you.
Thank you.
Speaker Change: So we maintain strong relationship with our partners in the market access space and believe that there is recognition of the value that Gorthrofen brings to this class.
Speaker Change: And as you think about the paleoscope, I think the most important mark...
Speaker Change: impactful market access change next year will be the increased affordability for seniors to the Medicare out-of-pocket cap, along with the smoothing mechanisms for that out-of-pocket. And our patient support team is prepared to educate patients and physicians about these new options.
which we believe should improve, you know, patient access.
Your second question regarding...
Speaker Change: You know our growth and and you know, where does it come from existing prescribers or
Speaker Change: I think the way I would look at it is, you know, when you look at total growth of A&I, we've been in the market for three years now and have achieved the growth that we have, right? Most recently growing.
Speaker Change: From $112 million in 2023 to a guidance of $196 to $200 million in 2024, that growth has come from both overall market growth
as well as share growth.
Speaker Change: And so when you sort of bring that down to the prescriber level, we're seeing both.
Speaker Change: prescribers that used to use the competitive product, as well as new prescribers that have been unique to PC, to Cortofan gel.
Speaker Change: And the other thing to just highlight is there are indications that ANI has that the competitor does not have, including acute gouty arthritis flares. So as you think about, you know, the overall ACTH market, which
Speaker Change: you know, if you take our guidance and the competitors' guidance.
you know, implies more than 20% growth year-on-year.
Speaker Change: and what the potential is and why we believe corticofenous has a strong multi-year growth trajectory.
Speaker Change: There's also, you know, beyond just the existing or the number of patients that were there on therapy a few years ago, there's also the additional indications that we have that the competitor does not have.
Speaker Change: So that's on the second question on, you know, the drivers of our growth in portrophin.
Speaker Change: And then on your third question on the cadence of new launches for generics and what does that imply for the trajectory for our generics business?
Speaker Change: We, our strong R&D team, along with the operational excellence and our U.S.-based manufacturing footprint with a strong FDA compliance track record, will continue to deliver a cadence of new launches.
Speaker Change: And we believe that the combination of these different factors will enable the A&I Genetics business to grow in the high single-digit, low double-digit range going forward as we have delivered over the past few years.
Thank you, David.
Thank you.
Speaker Change: Thank you. Our next question will come from Gary Nachman with Raymond James. Please go ahead.
Speaker Change: Thanks. Good morning. So, for Elluvian and UTEQ, the guidance of 30 to 32 million is from the close of Elimera on September 16. So, if I back out 4 million in the third quarter, it's 26 to 28 million for the fourth quarter.
Speaker Change: Is that a reasonable quarterly run rate to think about going into next year and then just talk about with the integration in place.
Speaker Change: how you plan to accelerate those products, if we could see growth next year, and also how much you think the New Day data could help potentially if it's positive, I guess in terms of combination use.
Great. Good morning, Gary, and thank you for your questions.
Speaker Change: Yeah, so your first question on Illuvian and Utique and the...
Speaker Change: The Q4 Implied Guidance. Since the deal closing, the commercial organization has been in a period of transition. We've hired and now have in place 45 ophthalmology-dedicated sales reps across the country.
Speaker Change: Some representatives have seen realignment of their territories. In addition, we've invested the time to cross-train this team across all three products, Elluvian, Utique, and Cortofen. And post-training, the combined sales team has been promoting all three products since mid-October.
So the Q4 guidance reflects this period of transition.
Speaker Change: And we are confident that the underlying demand for Illuvian and Utique are aligned with our expectations and expect to achieve our growth goals for these assets. So we would expect growth over this run rate in
in 2025.
Speaker Change: And we remain confident that the Alomar acquisition to add incremental 35 to 38 million incremental EBITDA in 2025 and anticipated to drive a single digit to a low double digit accretion in adjusted non-GAAP EPS.
Speaker Change: And then on the New Day study, I'll turn that over to Chris.
Chris Mutz: to answer your question regarding, you know, the impact of the New Day study. I will just say that from our perspective the the double-digit growth
of the New Day Study.
Chris Mutz: Having said that, you know, we look forward to updating you regarding, you know, as we get the top-line results towards the end of quarter one and beginning of quarter two, the implications of that on, you know, the commercial, the commercial implications of that on the growth trajectory for, for Illuvian.
But Chris, would you like to add anything?
Chris Mutz: Yeah, yeah. So, as mentioned previously, the New Day clinical trial is designed to generate prospective data, evaluating Louvian as baseline therapy,
Chris Mutz: in the treatment of DME and really compare it to current standard of care with anti-VEGF injections.
Chris Mutz: We think this study really has a significant opportunity for people to revisit how they're taking care of DME patients. Certainly anti-vegetative therapy has been the standard of care in early DME in patients.
generally receive multiple anti-VEGF
Chris Mutz: from the retina community is that this is going to be the data that has been needed really to reconsider the the way that has the approach has been taken and taking care of these patients and and really that the combination therapy of alluvium plus
Chris Mutz: and AntizigF could potentially have a role based on this data.
Okay, thank you, and then just...
Chris Mutz: Yeah, no, and then just on Quatrophin, I know it's pretty early days, but are you seeing a real benefit yet within ophthalmology from the combined sales team with Alamira? What sort of impact do you expect?
Chris Mutz: in the coming year, you know, specifically in ophthalmology. And then just with the prefilled syringe available, I think you said in the first half of next year, how much of a benefit you think that'll be from a convenience standpoint to help quartrophin overall? Thanks.
Thank you for both those questions again, Gary. Regarding...
Speaker Change: I'll take your second question first, which is the pre-filled syringe.
Speaker Change: This is a new offering that we're bringing to the market for patients to make it easier for patients that have, you know,
to increase the patient convenience.
Speaker Change: versus when using the vial to make it make the easier from an administration standpoint to use our pre-filled syringe.
Speaker Change: So, we do believe that this will be helpful for patients, this new offering will have an impact for patients that have, you know, increased inconvenience while using the, while administering the vials.
Speaker Change: So I think that's the first, I guess that was your second question. And then regarding your question on the impact of PCG and ophthalmology, look, it's early days, right? We just said that the combined ophthalmology sales team is
in the market since mid-October, promoting all three products.
Speaker Change: and the early signs of positive and we remain confident that
that there will be...
growth of cortrophin and ophthalmology with this combined self-force.
Speaker Change: And when the early signs are promising, but again, it's it's been
Speaker Change: a few weeks and we look forward to sharing further updates as we guide towards 2025 and inform on the updates on the progress made in this part of the business.
Okay, great. Thank you. Yeah, thank you.
Thank you.
Speaker Change: Thank you. Our next question will come from Vamal Devan with Guggenheim Securities. Please go ahead.
Great, thanks for taking my questions.
So cue if I could, so one...
Speaker Change: A little bit of a different angle on the quatrupin, questions I was asked before.
Speaker Change: You've continued to sort of beat and raise on this product through the course of this year.
Can you maybe just talk about what parts are doing?
Better? Is it more prolonged?
Speaker Change: There's a volume, there's a price, so what's been driving the upsides over the course of 2024 just as we begin to think about how to model it out for next year?
Speaker Change: And then the second question, I want to make sure I caught something you said in your prepared remarks correctly. And it's something around rare disease being the biggest segment or biggest unit in 2025. If you can just clarify that that's what you said. And then when you're comparing that, are you comparing that to...
Speaker Change: Just generics on its own, or are you comparing it to generics, established brands, and other altogether as a segment?
Thank you.
Speaker Change: Good morning, Vamal, and thank you for your question. Regarding growth in controphin,
Speaker Change: I think first you asked about the volume versus price. It's, you know...
A majority of the growth...
I think almost all of the growth comes from...
from Growth in Volumes.
Speaker Change: and where does that growth in volumes come from? We see growth across therapeutic areas, both the ones we focused on at launch.
Speaker Change: Neurology, Nephrology, and Rheumatology, as well as the newer areas of
Speaker Change: ophthalmology, gout, and pulmonology. And we also see robust prescribing demand across both existing prescribers and new prescribers, as I had answered in the question for David up front. So that's where the, you know, we're seeing growth sort of pretty much across the board.
Speaker Change: And then the second, your clarification on rare disease. We see the rare disease as the largest driver of growth for A&I as a company going forward. So that clarifies that part of the question.
Thank you, Bobo.
Okay, all right, thank you.
Speaker Change: Once again, if you would like to ask a question, please press star 1 at this time. Our next question comes from Liz Salewski with Truist Securities. Please go ahead.
Speaker Change: Hey, this is Jeevan, on for our last. Thanks for taking our questions.
So as you look back on the recent Alimera acquisition,
Speaker Change: and potentially consider future M&A. I'm just curious what learnings you take away from the transaction, if any, to prevent similar situations in regards to timely closure in the future. Thank you.
Yeah, good morning, Jeevan, and thank you for your question.
Speaker Change: Yeah, I think that's just a great question regarding, you know, learning. I think that as we look to look to pursue other M&A activities, I think we
Speaker Change: remain focused on what is strategically aligned and important for ANI. So the Alamira acquisition is a highly synergistic acquisition.
Speaker Change: It helps continue to expand the scope and scale of our rare disease business, which is right in line with
Speaker Change: with what we've been saying from, you know, from day one, actually for almost over a year. And that's something that we have been pursuing. So sort of sticking to our strategy.
Speaker Change: That's one lesson that we want to continue covering forward. And then the second is...
Speaker Change: You know, as you do an acquisition, there are bumps along the way. And to make sure that we can continue to stay and work through the challenges. And, you know, those challenges may vary from acquisition to acquisition.
Speaker Change: and you know to ensure that we understand the challenge, that we have the capability, experience and expertise to address the challenge and to move forward from there.
Speaker Change: You know, and, you know, we believe that with the Alamera acquisition, there is a, you know, a challenge related to the supply of
Speaker Change: Yatik that has come up, and we are well-positioned to address that challenge, right? We have been working closely with I-Point since the deal signing to address the issues on the warning letter.
Speaker Change: and that the work with and the collaboration and engagement with iPoint has become even closer since we closed the deal. And we remain confident that...
Bye!
Speaker Change: that I point will satisfactorily address the points raised by the FDA. In fact, they've been giving updates on the same as they've gone along. And we anticipate no impact on continuity of eutectic supply to patients in need.
Allah Hafiz
Speaker Change: And look, it is standard practice for ANI to work towards creating redundancies in supply chain for high-value products. Accordingly, we are taking steps to increase supply security for both Illuvian and Utique.
Speaker Change: So, you know, going back to your question, Jeevan, you know, there will be bumps along the way as we do acquisitions and, you know, make sure that the experience and expertise that we have, we bring that to bear, you know, in this case, it was related to
supply. It may be something else in a future acquisition.
Speaker Change: And look, we have significant capability and expertise in this area, given the three plants we run in the U.S. with strong FDA compliance track records and our experience in addressing points like these jointly with our suppliers.
Speaker Change: So, those are the lessons that I would, you know, sticking to our strategy and making sure that when bumps come along the way that we, you know, understand the bumps and address them.
Thank you, Jeevan.
Great, thank you.
Speaker Change: Thank you. At this time, I show no further questions in queue. I will turn the call back to Nikhil Lalwani for closing remarks.
Thank you.
Nikhil Lalwani: Thank you, everybody, for joining our call, and thank you for your interest in E&I. We look forward to continue updating you on our progress and look forward to seeing you at the conferences that we have coming up and engaging with you as we move forward. Thank you.
Thank you. Thank you. Thank you.
Speaker Change: Thank you. This does conclude the A&I Pharmaceuticals, Inc. third quarter 2024 earnings results call. You may disconnect your line at this time and have a wonderful day.
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