Amneal Pharmaceuticals, Inc. · NASDAQ:AMRX
Amneal Pharmaceuticals — Morgan Stanley Global Healthcare Conference 2020
41 slides from Amneal Pharmaceuticals's conference presentation, Sep 15, 2020
Slide 1: Investor Presentation
Investor Presentation Morgan Stanley Conference September 15, 2020 g
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain statements contained in this presentation, regarding matters that are not historical facts, may be forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995). Such forward-looking statements include statements regarding management’s
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures This presentation includes certain non-GAAP financial measures, including adjusted EBITDA, adjusted net income, adjusted net income per diluted share, adjusted gross profit, adjusted gross margin and adjusted operating income, which are intended as supplemental measures o
Slide 4: Investment Highlights
Investment Highlights Scaled commercial operations: • Highly profitable on an adjusted EBITDA basis with growing cash flow generation 2020E ~$2.0bn net revenue • Substantial financial flexibility: ~$300 million cash on hand June 30, 2020; up to $500 million Revolver access; No near-term maturities a
Slide 5: Tenured Management with a Track Record of Success
Tenured Management with a Track Record of Success Chintu Patel, Chirag Patel, Tasos Konidaris, Co-CEO Co-CEO and President EVP, Chief Financial Officer Co-Founder of Amneal Co-Founder of Amneal 30+ years of experience Nikita Shah, Stephen Manzano, Andy Boyer, Joe Todisco, EVP, Chief Human Resources
Slide 6: Amneal Timeline
Amneal Timeline $1,925 * Annual revenue performance since 2007 ($ millions) $1,663 $1,626 $1,018 $1,034 $866 $785 $531 $323 $352 $261 $163 $77 $19 2002 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2002: August 2005: June 2008: May 2011: October 2017: May 2018: August 2019: J
Slide 7: Robust & Diversified Operational Infrastructure
Robust & Diversified Operational Infrastructure PISCATAWAY Oral Solids, Topicals, Transdermals, NJ BRIDGEWATER High Potency and Hormonal Products CASHEL NJCorporate Headquarters IRELANDInhalation BRANCHBURG Oral Liquid Products, Nasal Sprays NJ VIZAG GLASGOW Active Pharmaceutical Sales Operations, K
Slide 8: Gx Dosage Form Capabilities
Gx Dosage Form Capabilities Oral Nasal IR / ER Solids Injectables Respiratory Ophthalmics Patches Topicals Liquids Sprays Partner Partner Partner Partner Partner Partner Partner Partner Partner
Slide 9: Amneal Portfolio Breakdown
Amneal Portfolio Breakdown 1H20A Net Revenue by Segment ($MM) 1H20A Adj. Gross Margin by Segment ($MM) $24.4 $121.8 20% $182.2 $135.1 74% $963 $416 $256.5 $659.1 39% Generics Specialty AvKARE Generics Specialty AvKARE Generics ~250+ commercial products and an additional 220+ in development Specialty
Slide 10: Generics – Driving Improvement and Diversification
Generics – Driving Improvement and Diversification Working Aggressively To Expand Sales and Improve Profitability, With ~ 250 Currently Marketed Products New Product Launches and Markets Robust Pipeline Margin Expansion • Grow market share as we plan to • Expecting to file 20 – 25 products • Expand
Slide 11: Continuing Generic Pipeline Execution
Continuing Generic Pipeline Execution What We’ve Done: What’s Next: 1 Notable Complex Generic Launches Continued Pipeline Execution Generics Injectables Transdermal Topical/Ring Oral Solids Liquid/Nasal Ophthalmic 11 (1) Generic versions of innovator products. All trademarks are the property of thei
Slide 12: Generics Pipeline Focused on Complex & Differentiated Dosage
Generics Pipeline Focused on Complex & Differentiated Dosage ANDAs Submitted (Pending + TA): 91 Projects Development Pipeline: 132 projects 1% 1% 2% 3% 5% 4% 6% 1% 13% 8% 8% 12% 43% 9% 11% 7% 8% 16% 13% 29% Inhalation Nasal Spray Transdermal Inhalation Nasal Spray Transdermal Oral liquid Oral liquid
Slide 13: Maximizing Well-Established Specialty Footprint & Infrastructure
Maximizing Well-Established Specialty Footprint & Infrastructure Growing franchise by focusing on marketing execution, building KOL relationships, and Building a Leading Position Offering Proven Options rapidly adapting to the changing healthcare in Movement Disorders for Migraine Patients landscape
Slide 14: Specialty – Growth Engine
Specialty – Growth Engine Therapeutic Program Preclinical Phase 1 Phase 2 Phase 3 Estimated Launch / Major Catalyst Area Topline data expected IPX-203 for PD Neurology 2023 2H 2021 K127 for MG(1) Neurology 2023 Expect to file by Q1 2022 bNeupogen(2) Oncology Filed; Awaiting FDA Correspondence bNeula
Slide 15: IPX203: Long-Acting Controlled-Release CD/LD Studied
IPX203: Long-Acting Controlled-Release CD/LD Studied IPX-203 is being studied as a possible improvement in efficacy and dosing convenience beyond Rytary. If approved, it would provide an expanded market opportunity for Amneal in PD Possible Indication & Product Profile for IPX-203 • Carbidopa-levodo
Slide 16: K127: Pyridostigmine GRANDE Being Studied
K127: Pyridostigmine GRANDE™* Being Studied In-licensed complementary CNS asset that expands portfolio into neuromuscular disorders, broadening Amneal’s reach in neurology Possible Indication & Product Profile for K127 Myasthenia Gravis (MG) is a rare autoimmune neuromuscular disease that causes e
Slide 17: Diversifying Our Distribution Channels with AvKARE
Diversifying Our Distribution Channels with AvKARE Growing Our Business and Identifying New Opportunities to Better Serve Government Agencies: About AvKARE Platform Well-Positioned for Growth Q2 2020 Financial Results In Line with • One of the largest private label • Generic manufacturers outsourcin
Slide 18: Financial Review
2 amneal Financial Review
Slide 19: Financial Results – GAAP
Financial Results – GAAP $ in millions Consolidated Q2 2019 Q1 2020 Q2 2020 Revenue 405 499 465 Gross Profit 105 183 144 Gross Margin 25.9% 36.8% 31.0% R&D Expense 48 37 46 SG&A Expense 67 78 81 Diluted EPS (0.13) 0.78 (0.08) Operating Cash Flow 21 49 179 Generics Q2 2019 Q1 2020 Q2 2020 Revenue 335
Slide 20: Q2 2020 Results
Q2 2020 Results Adjusted Results(1) Variance The addition of AvKARE, cost management and new products drive EBITDA growth versus prior-year $ in millions Q2 2020 Q2 2019 Q1 2020 YOY Sequential Revenue 465 405 499 15% -7% • Revenue YOY growth due to: AvKARE(2) ($64 million), EluRyng, Sucralfate and S
Slide 21: Generics Segment
Generics Segment Adjusted Results(1) $ millions Net Revenue Gross Margin Operating Income $335 $353 $307 $103 42% 34% 35% $65 $62 Q2 19 Q1 20 Q2 20 Q2 19 Q1 20 Q2 20 Q2 19 Q1 20 Q2 20 Year-over-year decrease: price erosion due to Year-over-year operating efficiencies and product Year-over-year
Slide 22: Specialty Segment
Specialty Segment Adjusted Results(1) $ millions Net Revenue Gross Margin Operating Income $94 $50 $88 82% 75% 74% $39 $39 $70 Q2 19 Q1 20 Q2 20 Q2 19 Q1 20 Q2 20 Q2 19 Q1 20 Q2 20 Year-over-year increase: higher sales of Rytary® Year-over-year decrease: primarily due to the Year-over-year inc
Slide 23: Balance Sheet and Liquidity
Balance Sheet and Liquidity $ in millions Liquidity at June 30, 2020 As of June 30, As of December 31, 2020 2019 Current portion and long-term debt(1) $2,794 $2,631 Cash and cash equivalents $268 Cash and cash equivalents(2) $268 $153 ABL Available $414 Net Debt(3) $2,526 $2,478 Gross Debt to LT
Slide 24: 2020 Financial Outlook as of August 6, 2020
2020 Financial Outlook as of August 6, 2020(1) (in $ millions except for Adjusted Diluted EPS) 2020 Guidance Net Revenues $1,875 - $1,975 Adjusted Gross Margin 44% - 46% Adjusted EBITDA $400 - $450 Adjusted Diluted EPS $0.45 – $0.60 Weighted Average Diluted Shares Outstanding(2) ~300 million Operati
Slide 25: Investment Highlights
Investment Highlights Scaled commercial operations: • Highly profitable on an adjusted EBITDA basis with growing cash flow generation 2020E ~$2.0bn net revenue • Substantial financial flexibility: ~$300 million cash on hand June 30, 2020; up to $500 million Revolver access; No near-term maturities a
Slide 26: Appendix
2 amneal Appendix
Slide 27: Consolidated Statements of Operations
Consolidated Statements of Operations ($ in thousands, except per share amounts) 27
Slide 28: Generics Operating Results
Generics Operating Results ($ in thousands) 28
Slide 29: Specialty Operating Results
Specialty Operating Results ($ in thousands) 29
Slide 30: AvKARE Operating Results
AvKARE Operating Results ($ in thousands) 30
Slide 31: Reconciliation of Net (Loss) Income to Adjusted Net Income and Adjusted Diluted EPS
Reconciliation of Net (Loss) Income to Adjusted Net Income and Calculation of Adjusted Diluted EPS ($) in thousands Three months ended June 30, 2020 June 30, 2019 March 31, 2020 Net (loss) income $ (23,944) $ (50,526) $ 121,517 Adjusted to add (deduct): Non-cash interest 1,998 1,617 1,866 GAAP Incom
Slide 32: Gross Debt and Net Debt to LTM Adjusted EBITDA
Gross Debt and Net Debt to LTM Adjusted EBITDA ($) in thousands Last Twelve Months June 30, 2020 December 31, 2019 Current portion of long-term debt, net 29,756 21,479 Long-term debt, net 2,764,578 2,609,046 Cash and cash equivalents and restricted cash 268,272 152,822 Net debt 2,526,062 2,477,703 A
Slide 33: Reconciliation of Net (Loss) Income to EBITDA and Adjusted EBITDA
Reconciliation of Net (Loss) Income to EBITDA and Adjusted EBITDA ($) in thousands Three months ended June 30, 2020 March 31, 2020 December 31, 2019 September 30, 2019 June 30, 2019 March 31, 2019 Net (loss) income $ (23,944) $ 121,517 $ (64,903) $ (363,392) $ (50,526) $ (124,752) Adjusted to add (d
Slide 34: Reconciliation of Generics Operating Income to Adjusted Operating Income
Reconciliation of Generics Operating Income to Generics Adjusted Operating Income ($) in thousands Three months ended June 30, 2020 June 30, 2019 March 31, 2020 Operating income (loss) $ 26,516 $ 4,886 $ 81,837 Adjusted to add (deduct): Acquisition and site closure expenses 4,188 10,885 4,600 Amorti
Slide 35: Reconciliation of Cost of Goods Sold to Adjusted Cost of Goods Sold
Reconciliation of Cost of Goods Sold to Adjusted Cost of Goods Sold ($) in thousands Three months ended June 30, 2020 June 30, 2019 March 31, 2020 Cost of goods sold $ 319,666 $ 296,381 $ 313,578 Cost of goods sold impairment charges 759 3,012 1,456 Adjusted to deduct (add): Amortization 35,966 34,7
Slide 36: Reconciliation of Generics Cost of Goods Sold to Adjusted
Reconciliation of Generics Cost of Goods Sold to Generics Adjusted Cost of Goods Sold ($) in thousands Three months ended June 30, 2020 June 30, 2019 March 31, 2020 Cost of goods sold $ 218,909 $ 263,423 $ 218,865 Cost of goods sold impairment charges 759 3,012 1,456 Adjusted to deduct: Amortization
Slide 37: Reconciliation of Specialty Operating Income to Adjusted Operating Income
Reconciliation of Specialty Operating Income to Specialty Adjusted Operating Income ($) in thousands Three months ended June 30, 2020 June 30, 2019 March 31, 2020 Operating income $ 23,569 $ 16,536 $ 9,867 Adjusted to add: Amortization 25,445 20,159 25,446 Acquisition and site closure expenses 83 2,
Slide 38: Reconciliation of Specialty Cost of Goods Sold to Adjusted
Reconciliation of Specialty Cost of Goods Sold to Specialty Adjusted Cost of Goods Sold ($) in thousands Three months ended June 30, 2020 June 30, 2019 March 31, 2020 Cost of goods sold $ 50,229 $ 32,958 $ 47,818 Adjusted to deduct: Amortization 25,445 20,160 25,446 Adjusted cost of goods sold (Non-
Slide 39: Reconciliation of Research and Development to Adjusted R&D
Reconciliation of Research and Development to Adjusted Research and Development ($) in thousands Three months ended June 30, 2020 June 30, 2019 March 31, 2020 Research and development $ 45,572 $ 48,016 $ 36,379 IPR&D impairment charges — — 960 Intellectual property legal development expenses 3,550 2
Slide 40: Reconciliation of SG&A to Adjusted SG&A
Reconciliation of Selling, General & Administrative to Adjusted Selling, General, & Administrative ($) in thousands Three months ended June 30, 2020 June 30, 2019 March 31, 2020 Selling, general and administrative $ 80,944 $ 67,281 $ 77,976 Adjusted to deduct (add): Amortization 8,010 — 6,480 Stock-
Slide 41: Amneal – We make healthy possible
2. Vamneal We make healthy possible.
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