Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Cipher Pharmaceuticals Second Quarter 2022 Results Conference Call. At this time, all participants are in a listen-only mode. Following today's presentation, instructions will be given for the question and answer session. If anyone needs assistance at any time during the call, you may press the star followed by the zero on your push-button phone. As a reminder, this conference is being recorded today, Friday, August 12, 2022. On behalf of the speakers that follow, listeners are cautioned that today's presentation and the responses to questions may contain forward-looking statements within the meaning of the safe harbor provisions of the Canadian provincial securities laws. Forward-looking statements involve risks and uncertainties, and undue reliance should not be placed on such statements. Certain material factors or assumptions are implied in making forward-looking statements, and actual results may differ materially from those expressed or implied in such statements. For additional information about factors that could cause results to vary, please refer to the risks identified in the company's annual information form and other filings with Canadian regulatory authorities. Except as required by Canadian securities laws, the Company does not undertake to update any forward-looking statements. Such statements speak only as of the date made. I would now like to turn the call over to Mr. Craig Mull, Interim Chief Executive Officer of the company. Please go ahead, Mr. Mull. Thank you, operator, and good morning, everyone. Joining me today is Scott Langille, Cipher's CFO. On today's call, I will make opening remarks before passing the call over to Scott to review the financial results in detail. Following our prepared remarks, we will open the call for questions and note that all amounts are in US dollars unless otherwise stated. We are pleased to report that Cipher delivered another strong quarter, generating positive net income and cash from operating activities. Our results demonstrate the stability of our business and the benefits of our cost reduction strategy. We ended the quarter with $24.2 million in cash, or CAD 31 million Canadian on our balance sheet, which provides us with tremendous financial flexibility as we evaluate a number of profitable product and company acquisitions to accelerate and continue to drive shareholder value. In May, the company's partner, Moberg Pharma, began patient enrollment for the North American phase 3 study of MOB015 to treat nail fungus. The purpose of the study is to facilitate market approval by the U.S. Food and Drug Administration or FDA. Cipher holds the exclusive Canadian rights to MOB015. In Canada, according to IQVIA, the total prescription market for onychomycosis was greater than CAD 75 million per year, with a single product having over 90% market share. In June, the company partner Can-Fite Biopharma announced positive top-line results from its phase 3 COMFORT study in the treatment of moderate to severe psoriasis. Based on the safety and efficacy data revealed in the trial, Can-Fite plans to approach the U.S. FDA and the European EMA with a protocol for a pivotal phase 3 study for drug approval and registration. We are pleased to see the continued progress that Moberg is making to commercialize MOB015. Patient enrollment is another positive step towards commercialization, and we look forward to competing in this large market with an innovative topical product that would provide a new, safe, and effective treatment option for many Canadians who suffer from this common nail infection. On the Can-Fite phase 3 COMFORT results, which were positive indication for CF101. An estimated 1.5 million Canadians suffer from psoriasis and rheumatoid arthritis, and Cipher holds the Canadian marketing rights to this new and novel product, which we believe holds substantial commercial potential. We continue to perform formulation and stability testing for our tattoo removal product, DTR-001, and we expect to move into animal studies in the very near future. The product has a significant market potential, and it is a highlight and focus of the company to move this product forward. Moving on to the financial results. Our second quarter results showed relatively stable revenue as we continue to transition through the launch of Absorica AG. Product revenue increased by CAD 0.2 million or 7% to CAD 3.5 million for the second quarter of 2022, compared to CAD 3.3 million for the comparable period in 2021. Product revenue for Epuris was CAD 3.3 million for the second quarter of 2022, up 9% from CAD 3.1 million in the comparative period. Product revenue continues to be driven by the strength of Epuris, which generated CAD 3.3 million in revenue. Again, a 9% increase from the comparative period. We are incredibly pleased with the performance of Epuris, which continues to be the most prescribed isotretinoin product in the Canadian market. Licensing revenue from Absorica in the U.S. was $1.3 million for the three months ended June 30, compared to $2.4 million for the three months ended June 30, 2021, but relatively unchanged from $1.4 million in the first quarter of 2022. Absorica's market share was approximately 4.4%, compared to 4.2% in Q2 2021, according to Symphony Health. Market share including Sun's Absorica LD was approximately 5.5%. We believe that the market shares for this portfolio have stabilized, and we expect that we will continue to see the same levels of volume throughout the contract with Sun. Currently, in our isotretinoin portfolio, Cipher is receiving royalties from Sun Pharma for the branded product, Absorica, the authorized generic, as well as Absorica LD. In addition, we recently announced an extension of this partnership from November 30, 2022 through December 31, 2026 for Absorica and Absorica AG, which will extend our revenue cash flow streams for this portfolio. Overall, Cipher has assembled an attractive portfolio of assets beyond our currently marketed products and will continue to move these products towards commercialization. We continue to strengthen our balance sheet. At June 30, 2022, our balance sheet had CAD 2.4 million in cash and no debt, and again, $24.2 million in cash, placing Cipher in an excellent position to continue to buy back shares and to actively pursue product and business acquisitions in a prudent manner with a focus on near-term profitability. We believe that Cipher now has a stable runway for growth. Aligned with our stated strategy, we remain focused on identifying and evaluating profitable product and company acquisitions that will accelerate our growth and drive shareholder value and are continuing to build cash reserves in anticipation of such transactions. Over the past quarter, Cipher's focus has been on M&A. We have reviewed many deals and opportunities and are advancing our review and analysis of several of these interesting possibilities. Yesterday evening, we announced the appointment of Brian Jacobs to the role of CFO effective August fifteenth. Brian's extensive experience in M&A and strategic leadership will help fortify our management capabilities and drive our next phase of growth. Brian brings a proven track record of senior financial expertise and enterprise success in the companies that he's been involved with. He also has extensive experience in managing growth, risk management, and cost efficiencies. We believe that his expertise will be valuable and will help us focus in pursuing profitable product and business acquisitions. Brian is an accomplished and strategic financial leader and has extensive experience in public company compliance, financing, as well as mergers and acquisitions. I am pleased to report that Scott Langille will remain with Cipher and will be focusing on business development and strategic mergers and acquisitions. I would like to thank Scott for his contributions and look forward to working with him as he evaluates a number of profitable product acquisitions which will help accelerate the growth of Cipher and continue to drive shareholder market value. I now would like to turn the call over to Scott for a financial review. Thanks, Craig, and good morning, everyone. We'll provide a financial update for our second quarter results. Total revenue was CAD 5.6 million in the quarter, compared to CAD 6.1 million for the comparative period. Licensing revenue was CAD 2 million for the quarter, compared to CAD 2.8 million for the prior year. Licensing revenue from Absorica in the U.S. was CAD 1.3 million compared to CAD 2.4 million in the prior year. Absorica and the authorized generic version of Absorica market share for the three months ended June 2022 was approximately 4.4% compared to approximately 4.2% for the prior year, according to Symphony Health. Total market share, including the authorized generic and Sun Pharma's Absorica LD, was approximately 5.5% compared to 6.2% in the prior year. Licensing revenue from the extended-release tramadol product, Conzip, and authorized generic version of Conzip in the US was 0.02 million for the three months ended June thirtieth, 2022, compared to 0.05 for the prior quarter. Lipofen and the authorized generic version of Lipofen was CAD 0.7 million for the quarter compared to CAD 0.4 million in the prior quarter. The increase was due to the change in the distribution partners and related terms of the distribution agreement. Product revenue increased by CAD 0.2 million or 7% to CAD 3.5 million for the second quarter, compared to CAD 3.3 million for the comparable period in 2021. Selling general and administrative expenses were CAD 1.1 million for the second quarter, a decrease of 6% compared to CAD 1.2 million for the three months ended June 30, 2021. Total operating expenses for the second quarter were CAD 2.2 million, a decrease of 5% compared to CAD 2.3 million in the prior period. Net income was CAD 2.1 million, or CAD 0.08 per diluted share for the quarter, compared to a net income of CAD 2.8 million or CAD 0.10 per diluted share in the comparative period. Adjusted EBITDA for the second quarter was CAD 3.6 million, compared to CAD 4.1 million for the prior year. The company had CAD 24.2 million in cash and no debt at June 30, 2022. Cipher generated CAD 5.2 million in cash from operating activities for the six months ended June 30, 2022. With a strong balance sheet, a reduced cost structure and additional visibility from the four-year extension of our relationship with Sun Pharma, we are focused on identifying and evaluating the right assets to drive our growth. We'll now open the call up to questions. Operator. Thank you. If you would like to ask a question, please signal by pressing star one on your telephone keypad. If using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Once again, everyone, to ask a question, simply press star one on your telephone keypad. All right, we will take our first question from Andre Uddin with Research Capital. Please go ahead. Hi, Craig and Scott. Some of this, I guess, was in your filings, but just wondering if you could just discuss a little bit further in terms of the Absorica competition and also if you could, if you expect Sun to add any promotional efforts to your LD formulation. That'd be great. Thanks. Andre, it's Craig here. Thanks for the question. From a competitive standpoint on that, on the isotretinoin market in the U.S., obviously we've seen the launch of AG of our authorized generic, which was followed by Actavis's generic launch. Subsequent to that, Upsher-Smith also launched. We have found that since the launch that the market shares for these products have stabilized, and that again AG holds the largest share of all of the isotretinoin products, and we're not seeing much movement in that share over the last few quarters. The pricing has stabilized as well. We're not seeing you know much in the way of increasing gross to net adjustments. We believe that this portfolio is stable going forward for Cipher. Andre, I think that you had a second part of that question that if you don't mind repeating it for me. Sure. Just, in terms of Sun, do you expect them to add any additional promotional efforts, to the LD formulation? The LD formulation that is manufactured by Sun and of which Cipher continues to earn a royalty from, you know, has not gained the market share that had been expected by Sun. I think that they may be considering additional commercial activity around that product, but we're not, you know, privy to it, even though we've, you know, been part of the launch of that product. I believe that because it's a, you know, a genericized market segment that you're not likely to see a lot of additional commercial activity for that product. That's fair. Just on the business development front, just I've been asking a number of specialty pharma companies is what are the trends that you're seeing in terms of prices of product acquisitions or is it stabilized? Has it dropped? Is it going up? Like what sort of trends are you seeing? We're seeing a lot more deals being presented to us and, you know, there seems to be quite a bit of movement in the Canadian specialty pharma market. Some of the players have been highly leveraged, and I think that might be catching up to them now. What we're finding is that we're getting a lot more calls, a lot more interest in doing deals, from the Canadian specialty pharma area, but also in product acquisitions that we've been looking at. I think that higher interest rates have meant that those that are leveraged are concerned about their cash flows and profitability going forward, and that creates a real opportunity for Cipher. We have no debt. We've got about CAD 30 million on our balance sheet. We've been looking at a lot more deals than we have in previous quarters. Now, this quarter in particular, this past quarter hasn't been overly productive just because of the amount of holidays, particularly European holidays. We expect that's gonna pick up again in September. Great. Thank you. All right. Moving on, we'll hear from Doug Loe with Leede Jones Gable. Please go ahead. Yeah. Thanks operator, and good morning, gentlemen. Maybe just sticking with the isotretinoin theme that Andre kick-started here. Just I've always been interested in Epuris's historical revenue ramp, which, you know, nine years post-launch, I mean, it continues to establish record quarterly revenue levels. I mean, that's quite unusual for most branded therapies that we've ever tracked. Just kind of wonder if you have any interesting comments about how your marketing strategy in Canada sort of continues to capture market share from, you know, Accutane and Clarus. Whether or not you see any possibility that the trend line could continue for what is, you know, clearly a fairly mature brand in the Canadian dermatology market. I have a follow-up. Thanks for the question, Doug. Craig here. Yeah, Epuris continues to grow. We continue to promote the product. We've taken different methods to do the promotion, just because COVID restricted us from getting into the doctor's office in any meaningful way. We've had a number of different seminars and lectures by key opinion leaders on the product, and they've been exceptionally well-attended, not only by dermatologists, but we're finding that family doctors are also interested in prescribing, you know, isotretinoin products, and Epuris is often at the top of their selection process. The product is absolutely valued among the dermatology segment. We continue to speak with them on a regular basis, not only about Epuris but also other pipeline products that we're working on as well. It is a resounding response that we get about Epuris. They think it is the gold standard. I expect it will continue to increase our volumes and our market share. The family doctor area is, you know, obviously a very large market, and they often look to the key dermatologists in their regions for advice on what to prescribe. The product that is being prescribed is Epuris. We expect that, you know, come September, that we will be engaging our contract sales organization to go out and physically promote the product as well. We expect that we'll continue to take market share. If we are able to get some public reimbursement in Québec and in BC, the market share increases could be quite substantial. That's great context. Yeah. Thanks, Craig. Then a boring tax question as a chaser. Just wondering what your strategy would be to being able to realize, you know, the considerable tax losses that you acquired in the Correvio acquisition several years ago, seeing that your tax expense continues to be at, you know, conventional Ontario tax rates. Just wondering if there's some sort of a strategy through your tax policy in order to realize those tax losses. I'll leave it there. Thanks. Uh- Scott? Doug, Scott here. We are indeed realizing those tax losses. We are accruing provision for taxes, but in our tax filings, we are utilizing the Correvio losses for 2020 and 2021. We have begun utilizing those tax losses on a filing basis. We are also actively promoting the hospital products to run the business as it should be. We've hired a promotional organization to run that business and we are actively looking for products to enhance that business. It's actively being pursued both with the current products and looking for future products to grow that business. Great. Good stuff. Thanks, Scott. All right. Our next question will come from Mike Schimeck with Private Investor. Please go ahead. Yeah. Hi, I have several questions. The first one would be with regards to the NCIB. It appears to have been completed by the end of July, and I was wondering if you expect to renew it? Yes, we expect to renew it. I think it expires in September and our intention is to renew it. In September? Yes. Okay. Okay, great. My second question was related to MOB-015. The release date appears to be at the end of 2023, hopefully in Europe. I don't have a vast familiarity with the Canadian pharma industry, so I was wondering what we could expect to see in Canada for a release date in Canada if Europe is accurate in terms of end of 2023. Mike, when you say release date, the date that it can be commercialized, is that the date that you're referring to? Yeah, product launch, when they actually start. Yeah doing sales. Our game plan with Moberg is that we will you know wait for the results to come in and you know we'll get updated results as well. We're in close contact with Moberg. It's a very exciting product for them and they're wanting as much assistance as they can get, and we're providing that for them where we can. I expect that the results for this phase three study that they're doing in the U.S. will be completed within the year. It'll probably take three months to do the reporting and statistical work before they're in a position to submit to the FDA. If the results are what we hope and expect, Cipher can in parallel, you know, apply to Health Canada with a complete submission file. Once that complete submission file is submitted, we believe that it'll take approximately 9 months to 1 year to get full approval by Health Canada and at which point we can commercialize the product. Okay. Great. Thank you very much for the clarity on that. I have like two last questions. With regards to the one of the prior callers asked a question regarding this as well, and I was wondering if you can offer any additional clarity. Sorry for asking for that. Income tax payable at the end of 2020 was CAD 2.6 million, and now income tax payable has ramped to CAD 7.9 million. It was mentioned that it has something to do with the filing. I was wondering if you can offer any additional clarity on why that keeps on going up. Sure. We had a discussion with our auditors, and for the financial statements, the decision was made to accrue taxes. However, in our actual filings with Revenue Canada on tax returns, we are utilizing the carryover losses. We're applying those carryover losses to the tax returns. With our discussions with the auditors, we decided to accrue taxes on the financial statements. That's a conservative approach, obviously. Okay, great. That's what I thought it was. Okay, my final question relates to the answer that you gave to a prior caller as well, which I found interesting. You talked of Quebec and BC public reimbursement with regards to Epuris. Is it currently the situation that some of your competitors do have public reimbursement and you do not? And if that situation changes, then we can expect an increase, a substantial increase in market share from those markets. Is that what you're saying there effectively? That, that's correct. Oh, that's interesting. Okay, great. Well, thank you very much for answering all my questions. Thank you. Thank you. Our next question will come from Peter Ratek with Ratek Consulting. Please go ahead. Good morning. Craig, I was wondering if you have any updates on efforts to sell isotretinoin in South America, in particular in the large Brazilian market. I think we talked about this probably about six months ago, while I do appreciate some of the difficulties in getting into those markets politically and otherwise, the question is, are there any updates and in particular with regards to Brazil, given the size of that market and the nature of the product, et cetera, and then presumably the wide appeal it would have in that market? Hi. Hi, Peter. Thanks for the question. Yes, we are making progress in Latin America. In particular, we continue to have issues with the Brazilian regulatory authority, and it really stems from the fact that they want all products that they allow onto their formularies to be manufactured in Brazil. Right. That really becomes a non-starter for us. We've looked at other ways to do it. We're working with Sun in Brazil, who's our commercialization partner at the moment for Brazil. They are telling us that they're having extreme difficulties on getting the authorities there to accept our submissions. They continue to work at it, and they've got, I believe, some meetings in the not-too-distant future to try to address some of the difficulties or some of the limitations that we're having with the regulatory people. On a positive note, the Epuris has now been approved in Mexico, and our partner there, our commercialization partner, Italmex, is in the final stages of having a plan set for commercialization, which we expect in the next few months. The product will be on the market and being sold. We have a royalty arrangement on that product that we will collect a royalty on revenues products sold in Mexico. The same company, Italmex, also has branches in other Latin American and South American countries, including Chile, Peru, and a number of other ones. We're working with them and Galephar to see if we can get approvals in the more lucrative markets. Okay. Very good. Any other questions on that, Peter? I was just wondering if you had any update on the tattoo removal cream that's in the pipeline? Yes. I mentioned it earlier in my speech here, but we are at the stage where we're working with contractors to stabilize the formulation, and we need to be able to stabilize the formulation in order to, you know, move to the next phase, which would be animal studies. That's where we're at. I believe that work is nearly complete. The results are good. We have a stable formulation. The next step will be putting the product into animals to do animal trials. We've gotten a great deal of interest from other groups on this product, and we're looking at some possible partnerships on the development of the product itself. We have great hopes for this product. Okay. Terrific. Thanks, Peter. If I could just one last question. This is, I guess, really for Scott. With respect to the tax losses that we've talked about, it's my understanding that none of them are close to expiry in terms of, when I say close, within the next couple of years. That from a utilization or potential utilization standpoint, none are at risk of falling off the table without being utilized. Is my understanding correct in that regard, Scott? Yeah. Are you talking about the Correvio losses, is that correct? Yes. Sorry. Yeah. Yeah. No. We're fine there. We would have plenty to utilize on our filings of tax returns. Okay. Again, none are near term expiry? I don't believe so. Dave, is that your understanding as well? I think the first year of losses is 2026 or expiry of losses is 2026, yeah. In the order of magnitude, just roughly on that one, do you have that offhand? I don't. No. Okay. All right. I mean, hopefully the profitability of Cipher is going to well exceed whatever that number is in any event, between now and then. Therefore will be fully utilized. That's hopefully the expectation. That's the goal. Yep. Yeah. Yep. Okay. Very good. Thank you. Thanks, Peter. Craig, Scott and Brian. I appreciate it. Thank you. Thank you, Peter. We have no additional questions. I'll turn the call back over to Craig Mull for closing remarks. Thanks for joining the meeting today. We look forward to keeping you updated on our progress and for the balance of 2022 as we execute on our priorities. We expect that the coming quarters will be very exciting for Cipher. Again, thanks for your time, and look forward to talk to you again next quarter. This concludes today's call. We thank you again for your participation. You may now disconnect. You may now disconnect.