Amphastar Pharmaceuticals(US:AMPH)2020-08-08 15:34Financial Data and Key Metrics Changes - Sales for Q2 increased by 9% to $85.8 million from $79 million in the previous year [16] - The company reported a net loss attributed to shareholders of $200,000 or $0.00 per share compared to a net profit of $47.8 million or $0.96 per share in Q2 2019 [20] - Adjusted net income was $7.6 million or $0.16 per share, up from $4.1 million or $0.08 per share in the same quarter last year [20] - Gross margins declined to 39% from 41% due to reserves for raw material purchases [18] Business Line Data and Key Metrics Changes - Primatene Mist sales grew nearly 400% to $12.5 million from $2.5 million [16] - Epinephrine sales increased by 122% to $7 million from $3.1 million [16] - Enoxaparin sales rose to $10.2 million from $9.8 million, primarily due to a change in customer mix [16] - Naloxone sales increased to $8.7 million from $7.8 million on higher unit volumes [16] - Sales for products used in elective surgeries, such as lidocaine and Cortrosyn, saw a decline [17] Market Data and Key Metrics Changes - The company is expanding Primatene Mist into Kroger stores, which encompasses over 2,700 locations [11] - The launch of the epinephrine multidose vial product is benefiting from 180 days of market exclusivity [12] Company Strategy and Development Direction - The company aims to diversify its portfolio, reducing reliance on enoxaparin from 51% of revenue to just 13% [14] - The strategy includes increasing advertising spend for Primatene Mist and expanding its market presence [10][11] - The company is focused on advancing its pipeline for further portfolio diversification [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's resilience and growth despite COVID-19 impacts [9] - The company anticipates a catalyst-rich second half of 2020 [9] - Management noted that clinical trials experienced minor delays due to COVID-19 but expect expenses to increase as trials return to normal [18] Other Important Information - The company repurchased $5.8 million of stock during the quarter and announced an additional $20 million buyback program [20] - Cash flow from operations was $30.1 million, the highest quarterly amount ever except for a one-time payment last year [20] Q&A Session Summary Question: How is the uptake of the epinephrine vials? - Management indicated they are not aiming to dominate the market but are making progress in gaining market share [24] Question: What is the timeline for AMP 001 FDA approval? - The expected action date is in the third quarter of this year [26] Question: What are the drivers for Primatene Mist reaching $65 million in annualized sales? - Increased advertising spend and expansion into more retail outlets are key drivers [28] Question: What is the dollar impact of expanded capacity for sodium bicarbonate? - The additional capacity represents a $20 million opportunity [31] Question: What is the long-term market capture potential for epinephrine? - The company has the capacity to take 100% of the market but aims for a reasonable share [33] Question: What is the expected timeline for inhalation pipeline filings? - One filing is expected at the end of this year, with several others to follow [35] Question: What are the current trends for Primatene sales? - Sales trends are positive, with an expected increase in advertising spend [37] Question: What is the expected timing for Kroger's launch of Primatene? - The launch is expected in early Q4, with shipping starting at the end of Q3 [60] Question: How does the Teva decision affect the intranasal naloxone program? - Management stated it has not affected their development plans [52] Question: What is the current status of AMP 001 and AMP 002? - Both products are still competition-free, with positive expectations for approval [57]