Release Date: July 30, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Pacira BioSciences Inc (PCRX, Financial) reported solid sales across all three of its products, with EXPAREL sales increasing to $136.9 million.
- The company has strengthened its balance sheet and bolstered its leadership team, setting the stage for sustainable top-line growth in 2025 and beyond.
- Pacira BioSciences Inc (PCRX) is preparing for separate Medicare reimbursement for EXPAREL, which is expected to drive utilization in outpatient settings.
- The company has launched a national campaign, 'Make The No Pain Impact,' to drive education and awareness among key stakeholders.
- Pacira BioSciences Inc (PCRX) has made significant progress in its research and development pipeline, including promising interim results from a Phase 1 study of PCRX-201 for knee osteoarthritis.
Negative Points
- The FDA's recent approval of a generic liposomal bupivacaine poses a potential threat to EXPAREL's market share.
- The company is involved in multiple patent infringement lawsuits, which could result in prolonged legal battles and uncertainty.
- EXPAREL's volume growth was largely offset by a shift in vial mix and discounting associated with the launch of the Premier partnership.
- Non-GAAP R&D expenses increased due to start-up activities for registration studies, impacting overall profitability.
- The company faces challenges in achieving broad market adoption and integration of new reimbursement policies, requiring ongoing investment in education and awareness initiatives.
Q & A Highlights
Q: Frank, just to kick off on the generic liposomal bupivacaine approval early July, July 2. Just wondering if you could comment on your evolving confidence in your ability to defend EXPAREL at this key point in time. To what degree was that development surprising to you?
A: Well, thanks for the question, Greg. With regard to the ANDA approval, as Tony mentioned, that has nothing to do with our case. So that's a separate matter. Our confidence hasn't changed with regard to our case. We have multiple levels of legal action and defense at our disposal. So that's unchanged.
Q: You mentioned the ability to prepare for NOPAIN with the resources in medical affairs. Can you give us an update on how that infrastructure is looking and to what degree will you be quantifying that?
A: Yes, it's a good question, Greg. We're very pleased to see the proposed rule come through this past month, and it's exactly as we'd expected. Our internal preparations are right on track. Our foundation is set in terms of all the things that we've done to expand our capabilities on the commercialization side, medical affairs side, and market access side. We see growing awareness of NOPAIN and the ASP+6 separate reimbursement.
Q: As you were diligencing the company ahead of accepting the CEO position, what was your view regarding the approvability of a generic? Did that approval surprise you?
A: When you give people enough resources and time, it's not surprising what they can do. That doesn't change anything with regard to the legal actions that are in play now and will be in play going forward. This is the first piece, and there will be others down the road.
Q: Can you talk about how you think market dynamics will play out if eVenus does come into the market?
A: It's hard to say. We've looked at various models, but I don't really want to speculate on that. I believe in our position and the strength of our IP, and we're going to defend our IP very rigorously going forward.
Q: Appreciating the way you laid out the three different scenarios and potential outcomes, can you explore the middle scenario where the patent is valid but not infringed?
A: Sure. Keep in mind the 495 case is just the first case. There are four other patents behind the three subsequent cases. Each one of those is different, and we have reason to believe that there's infringement on the other patents. So even if the 495 isn't infringed, we believe that the other patents are infringed.
Q: How long will it take for those additional patent cases to progress to trial? Will it be the same judge as the 495 case?
A: At the most recent status conference, the Magistrate didn't give a trial schedule for these other cases. All of these cases are in front of the same judge, Judge Arleo in New Jersey. Each of these patents is different and claims different properties of EXPAREL.
Q: How much more do you have to do to get the full commercial organization in place and ready for NOPAIN?
A: The foundation is set in my mind as it relates to medical and market access. Now we're going to engage our customers and really start to execute in a way that gives us clear insight about the key segments of customers and to what extent certain customers will adopt early as opposed to a little bit later in the year.
Q: Given the strong 2Q results, is there a level of conservatism built into the guidance?
A: We're pleased with where the business has been in the second quarter. We think we did what we needed to do on the top line, margins, and OpEx. All of those put us favorably within the original guidance ranges. Was guidance conservative? Well, it might have been. We'll see.
Q: Have you received a commercial sample of the generic product from eVenus?
A: We have not received a sample of the ANDA product yet, and the issue is currently before the magistrate judge to work out the logistics to get those samples.
Q: What is the estimated time for how long it would take for the three additional patent cases to progress to trial?
A: At the most recent status conference, the Magistrate didn't give a trial schedule for these other cases. All of these cases are in front of the same judge, Judge Arleo in New Jersey. Each of these patents is different and claims different properties of EXPAREL.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
