Release Date: August 08, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Collegium Pharmaceutical Inc (COLL, Financial) reported a 7% year-over-year increase in revenues and a 12% increase in adjusted EBITDA for the second quarter of 2024.
- The company successfully executed the Hikma authorized generic agreement and secured a six-month pediatric exclusivity extension for the Nucynta Franchise, extending its exclusivity to 2027.
- The proposed acquisition of Ironshore Therapeutics is expected to diversify Collegium's portfolio and add Jornay PM, a product with significant revenue potential and exclusivity into the 2030s.
- Belbuca achieved record quarterly revenue, with a 21% year-over-year increase, and Xtampza ER revenue grew by 8% year-over-year.
- Collegium secured attractive financing for the Ironshore acquisition, reducing its cost of capital by 300 basis points and enhancing debt management flexibility.
Negative Points
- Nucynta Franchise net revenue decreased by 6% year-over-year, indicating challenges in maintaining its market position.
- GAAP operating expenses increased by 13% year-over-year, partly due to a $3.1 million charge related to the CEO transition.
- The company faces risks related to the successful integration of Ironshore Therapeutics and realizing anticipated benefits from the acquisition.
- Belbuca's Medicare Part D coverage is currently limited to about 30% of lives, posing a challenge for broader market penetration.
- The search for a new CEO is ongoing, which may create uncertainty in leadership during a critical phase of growth and acquisition integration.
Q & A Highlights
Q: Can you talk about how you're thinking about improving Medicare Part D access for Belbuca beyond this year? And what does the current coverage look like?
A: Currently, Belbuca is covered for about 30% of Medicare Part D lives. We are focusing on the clinical profile of the drug, emphasizing that Schedule III should be used before Schedule II, to improve coverage. We are engaging payers with clinical data and expect to achieve new wins by November if the economics work for us. - Scott Dreyer, Executive Vice President and Chief Commercial Officer
Q: Regarding the acquisition and focus on ADHD, how do you think about additional transactions over the long term as you delever and generate cash?
A: In the short term, we will focus on integrating and growing the Jornay business. We will be calling on pediatrics and neuropsych, sharpening our business development focus around these areas, which gives us a lot of optionality. We will look to create synergy as we build our business development strategy. - Michael Heffernan, Interim President and CEO
Q: How do you balance the integration of Ironshore with maintaining the performance of your current portfolio?
A: We will maintain 100% of our pain sales force and marketing teams focused on pain, while integrating a fully commercialized Jornay team. There will be no overlap, with each team focusing on their respective responsibilities. - Scott Dreyer, Executive Vice President and Chief Commercial Officer
Q: Has the Ironshore acquisition changed the focus on the potential candidate selection for the CEO search?
A: The CEO search is ongoing and has seen increased interest due to the growth potential with Jornay in the portfolio. We remain focused on finding a top-tier candidate, and the acquisition has not changed our strategy. - Michael Heffernan, Interim President and CEO
Q: What are the financial expectations for Jornay PM in 2024?
A: Jornay PM is expected to generate net revenue in excess of $100 million in 2024. It has significant growth potential and is poised to become a leading growth driver for Collegium. - Colleen Tupper, Chief Financial Officer
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
