Amphastar Pharmaceuticals, Inc. Q2 FY2025 earnings call

• Capital Investment: Announced significant expansion at California headquarters to quadruple domestic manufacturing capacity to mitigate international supply chain risks and support R&D.
• Regulatory Initiatives: AMP-002 under FDA review with ongoing optimistic dialogue for near-term approval. AMP-007 inhalation filing expects GDUFA date in first half of 2026. AMP-015 teriparatide on track for GDUFA action date in fourth quarter 2025. AMP-018 GLP-1 ANDA to respond to complete response letter in second half of 2025. Insulin aspart BLA AMP-004 advancing towards interchangeability.
• R&D: R&D expense rose 14% year-over-year due to increased material and clinical trial costs for pipeline products.
• Financials: Net revenues were $174.4 million, GAAP net income was $31 million or $0.64 per diluted share, non-GAAP adjusted net income was $40.9 million or $0.85 per diluted share. Cash flow from operations was approximately $35.6 million, with $39.2 million worth of shares bought back and Board approving an additional $50 million stock buyback program.

In the second quarter of 2025, Amphastar reported net revenues of $174.4 million. BAQSIMI had total revenue growth of 21% year-over-year, with sales reaching $46.7 million. Primatene MIST sales were steady at $22.9 million, with year-to-date growth of 10%. Glucagon injection sales declined 25% to $20.6 million due to increased competition. Epinephrine sales decreased 42% to $16.2 million because of competition. Lidocaine sales increased 17% to $15 million. Other pharmaceutical product sales decreased to $53.1 million from $57.6 million, partially offset by albuterol sales launched in August 2024. BAQSIMI contributed significantly, making up a major portion of the revenue growth, while other segments had varying performances in terms of growth or decline.

• Still guiding to flat year-over-year sales, expecting two approved products to contribute to this level.
• BAQSIMI is on track for high single-digit unit growth and a 3% price increase in the United States.
• Revenue guide includes risk-adjusted expectations of 2 launches, including AMP-002 and AMP-015, which are anticipated to contribute to the flat sales guidance.

• Competition: Impacting legacy products like glucagon and epinephrine.
• Geopolitical: Risks affecting international supply chains, mitigated by U.S. manufacturing expansion.
• Market Crowding: GLP-1 ANDA (AMP-018) facing a crowded generic market, leading to it being a small contributor to sales.

Q: First, on the top line expectations halfway through the year and BAQSIMI's performance in the second half.

A: Still guiding to flat sales year-over-year, and BAQSIMI is on track for high single-digit unit growth and a 3% price increase in the United States.

Q: On the confidence level for AMP-002's approval.

A: Still remain optimistic about the approval of AMP-002, with ongoing engagement with the FDA.

Q: On AMP-018 GLP-1, thoughts on the opportunity given the change in IQVIA trailing 12-month sales.

A: This is one where we think there's going to be a very crowded generic market, so we expect it to be a relatively small contributor to our sales.

Q: On expected margin trajectory for the second half and epinephrine competition.

A: Expect margins to contract due to increased price competition on glucagon going forward. For epinephrine prefilled syringe, the competition is already reflected in current quarter numbers with both pricing and unit drops contributing to the sales decline.

Q: On glucagon revenue outlook and manufacturing expansion motivation.

A: Glucagon is expected to drop further due to new competitors entering the market. The manufacturing expansion at the California headquarters was motivated by the geopolitical environment to mitigate supply chain risks and to support the pipeline, especially for proprietary products.

Q: On revenue guide and AMP-007 opportunity.

A: Revenue guide includes 2 risk-adjusted launches, including AMP-002 and AMP-015. On AMP-007, as far as we know, we could be the first approval on that and if we're the first approval, it has the potential to be a significant market opportunity.