Assertio Holdings, Inc. Q1 FY2025 earnings call

• The company's strategy has three phases: stabilization (completed in 2024), transformation (2025 priorities include reducing legal exposure, simplifying corporate structure, prioritizing growth assets, divesting non-core assets, and closing a strategic transaction), and growth (expected to start in 2026).
• Legal exposure has been reduced through settling multiple prior legal matters, including a DOJ False Claims Act lawsuit, Glumetza antitrust action, and securities class actions. Opioid litigation liabilities were transferred to ATIH Industries LLC.
• Corporate structure simplified by transferring assets of Assertio Therapeutic Subsidiary to ATIH Industries LLC, removing Assertio Holdings and subsidiaries from opioid litigation named defendants.
• Rolvedon sales were impacted by fourth quarter stocking but demand remains strong; Sympazan prescriptions up 6.5% year-over-year; Indocin sales stable.

In the first quarter, net product sales totaled $26 million. Rolvedon contributed $13.1 million, Indocin contributed $5.5 million, and Sympazan contributed $2.2 million. Rolvedon's revenue was 50.38% of the total net product sales, Indocin was 21.15%, and Sympazan was 8.46%.

• First quarter net product sales were slightly ahead of plan at $26 million and tracking to full-year net product sales and adjusted EBITDA outlook.
• Adjusted EBITDA guidance for the year is 10 million to 19 million, and net sales guidance remains on track with the current portfolio.

• Legal risks related to prior settlements and potential future litigation.
• Impact of tariffs on drug substance for Rolvedon, though current inventory in the U.S. mitigates short-term risk.
• Uncertainty around drug pricing changes and proposed Medicaid changes, though no immediate significant risk identified at present.

Q: Hey, good afternoon, guys. Thanks for taking the questions. Brendan, congrats on offloading the opioid litigation matters. Were there, just out of curiosity on that, was there value in either direction on that? Did you guys pay them to take it? Did they pay you to accept it? Was there any value movement there?

A: Yeah, just nominal value they paid us Thomas.

Q: Hi, thanks for taking my questions and congrats on progress. Just 2 questions, on Rolvedon, I believe you previously spoke about expanding into the hospital setting away from the community setting. Could you kind of provide some comments and details about how that's progressing thus far in 2025 and sort of where you start or wherever you would expect to see an inflection point there?

A: Hi, Naz. Thanks for the question. I think if you think about Rolvedon, today, most of our business is in the community oncology, Medicare Part B space. To be successful in the hospital space, we really need to grow our commercial payer side that will unlock a couple of things for us. It'll unlock more of the commercial channel for us, and then it'll unlock hospitals as well. So, the next step in the strategy is really to build our payer coverage, which we've done with Cigna, as I mentioned in my opening comments, and hope to expand in the second half of this year and then further expand in 2026. As we do that, we'll be able to get more of the commercial clinic space business as well as that will enable us to impact or penetrate hospitals to a greater degree.

Q: Thanks very much for taking my questions. Just in furtherance of additional context regarding the Rolvedon situation. Can you give us a sense of what additional promotional or marketing strategies you expect to implement over the course of the remainder of this year to try to accelerate growth in Rolvedon sales?

A: Sure. Hi, Ram. Thanks for the question. Couple of things. I mean, first of all, there's still more market share we can get in our primary space, which is the Medicare Part B clinics. There's still some -- some large groups out there that we hope to attract additional volume with and additional shares. So, that's one. Second, I mentioned the payer piece. We've just begun to start -- starting to pull that business through on the commercial side. So, that's two. We hope to expand that coverage in the second half of the year, which would be the 3rd, and again that will enable us to get some penetrations in the hospital. So, if you see that, it's kind of building throughout the year, we expect Rolvedon to continue to grow in net sales and volume as we go through this year.

Q: Thank you and good afternoon. I guess first with regard to Rolvedon, you do mention pricing pressure. Could you talk about the pricing, how it is kind of year-over-year and sequentially and your expectations going forward?

A: Yeah, hi Scott. I mean, it is a quarter-to-quarter type of strategy, so -- ASP does erode over time, and some quarters is a bigger impact than others. It's a very competitive marketplace as we play in this -- this Neulasta biosimilar long-acting GCSF space. And there could be new entrants that enter as we go through this year that could also have an impact. So, I think we're doing a very good job of maintaining and managing our ASP. I think the way that we think about the business and the way we execute and contract the business is smart, which I think is why our ASP has been slower to erode maybe than others, and we continue to build volume and gain new customers, and that's part of the step down from Q4 to Q1 was we brought in some new customers in Q4 that were going to pull through in Q1. So, we wanted that inventory there and we pulled that through in Q1, so you'll start to see that grow as we go into Q2 and beyond.

Q: Hi, good afternoon. Thanks for taking the questions. In addition to all the internal changes there, you're dealing with some external changes as well. Can you comment on what impact do you think there could be from either the tariffs or the executive order regarding drug pricing or the proposed changes to Medicaid?

A: Yeah, I mean, so the tariffs is who knows, right? That's a daily up and down. We've got a significant -- probably a thing we would be most exposed on with tariffs would be drug substance on Rolvedon, but we've got a significant inventory here in the U.S., so, we don't expect any short-term impact, and by the time there's an impact, hopefully that situation will be worked out. With regards to drug pricing, we do not sell any products outside of the U.S. with the exception of Cambia that we sell in Canada, and Cambia is probably more expensive in Canada, the fact that it's not generic and it's generic here. So, we'll see, there needs to be a lot more details on drug pricing, it's going to take a while for the details to come out as to how that's actually going to play out, -- at least right now, we don't see any real risk on either one of those 2 things.