Assertio Holdings, Inc. Q2 FY2024 earnings call

• Brendan joined Assertio over two months ago and sees a good match between his skillset and the company's needs. The focus is on steady execution, driving cash flow, and identifying new assets. - Rolvedon Q2 sales increased again, with 6 consecutive quarters of demand growth, well-regarded by physicians and patients. Enrollment of Rolvedon same day dosing trial was completed, with initial data expected later in the year. - Indocin is managing loss of exclusivity with one generic competitor, maintaining market share at target levels. The organization has been right-sized. - Generated $7.4 million in cash, with cash and short-term investments at $88.4 million. - Ajay discussed financial results: total product sales $30.7 million, gross margin 71% (73% excluding purchase accounting inventory step up amortization), SG&A expense $18.4 million, R&D expense flat, adjusted EBITDA $5 million in Q2.

For the second quarter, Rolvedon sales were $15.1 million, up from $14.5 million in the prior quarter, driven by continued volume growth. Indocin sales were $6.9 million, down from $8.7 million in the first quarter due to generic competition. Rolvedon's revenue contribution was a significant portion, with its growth continuing the momentum from prior quarters. Indocin's sales declined as it faced generic competition.

• Maintained 2024 guidance for net product sales in the range of $110 million to $125 million. - Maintained 2024 adjusted EBITDA guidance in the range of $20 million to $30 million.

Q: Brendan, with only a couple months in the role, what excited you about the opportunity and what's confirmed since joining?

A: Brendan said it's exactly as he thought, with balance sheet, people, and commercial model confirmed. Landscape and business development heating up, excited about Rolvedon's growth and potential to add assets.

Q: Regarding product sales, how are you thinking about modifying guidance?

A: Brendan said he'll reassess in November after having a better handle on the year's progress.

Q: Expectations on generic competitors for Indocin by end of year?

A: Originally expected another generic in July which didn't happen, potentially one or more by end of year, but uncertain.

Q: Overall strategy for additional products, virtual vs field salesforce?

A: Looking for assets that fit current commercial model, not exclusively virtual or field, but building on capabilities, cash accretive, with patent protection/exclusivity.

Q: Gating factors in closing acquisitions, valuations, structure?

A: Brendan said valuations are always too high, in active discussions, Ajay said will use cash first then other capital sources.

Q: Rolvedon's growth in 2025, competitive dynamics?

A: Bullish on Rolvedon, expect growth, balance ASP erosion and volume growth, Q3 may be flat but continued growth expected.

Q: Performance of Otrexup and Sympazan?

A: Sympazan starting to see modest regrowth, Otrexup relatively stable; aggregate of both was approx $4.7 million.

Q: Rolvedon same day dosing trial data and future trials?

A: Data not fully seen yet, optimistic, will determine on full results if larger trial needed.

Q: Inventory step up charge and write-down charge in Q2?

A: Inventory step up charge was ~$400, write-down charge for late-stage products was ~$1 million increase quarter-over-quarter