Good morning, David Amsellem again from the pharma team here at Piper Sandler. Welcome again to the Piper Sandler Healthcare Conference. We're gonna go right into our next company, Amneal, and delighted to have Chirag Patel, CEO, co-CEO, I should say. Yeah, co-CEO. Co-CEO. I don't know, I don't want to do any short shrift to your brother. So, we're gonna jump right in. There's very much a lot of to talk about this morning, but maybe, Chirag, you can give some brief remarks and we can go right into questions. So I'll turn it over to you, and thanks for joining us today. Oh, thank you, David. Excellent. This location always excites me because 1987, February of 1987, we came to America and had to work as a student from day one. So literally day three, I was working at the gift store downstairs and worked here for one year. So this is always a reminder where we started and how the American dream and American entrepreneurial system and our own great work, hard work, smart work, the teams got us here today. So what is exciting is, in four years, we were able to diversify the company and put all the business segments on a growth mode, including generics, which is retail generics, right? Which is on a growth path. Injectables are an excellent growing category for us. Biosimilar, we just started, launched three, many more to come, and now it annualizes this year handsomely. Specialty, we're excited for IPX203 launch, and it grows. $400 million business, it would be probably 10% growth this year and continue to grow as the further pipeline develops. And our distribution business, which is very targeted distribution, value add, is also growing double digits. And then international, on top of that, is adding more diversity. So with all that, we feel really good. Mm-hmm. We proved it this year, and it carries on to next year. Great. That's a great intro, and, I have lots of questions, so- Yeah, well. I'm gonna dive right in. You mentioned injectables, and I'm particularly interested in that business. It's a big priority for the company. I wanted to get your thoughts at a high level on your longer-term vision for the footprint of your injectable business, and also get your latest thinking on what kind of capabilities you have in that segment. Yes. So injectables is an extremely important area for the company. We have invested over 7 years. Mm-hmm. So we built capacity, and at the same time, we were building our capabilities, so all our India capabilities. Mm-hmm. It's not the volume injectables we are competing. It's more of a value base, so we have invested in the technology. So we have bags, we have, emulsion technology, we have microsphere technologies. Pretty soon you'll see us filing a couple of products on microsphere. Peptides, you'll see us filing and announcing a couple of products. We have the products like propofol- Mm-hmm. - which is always in shortage. We're also addressing shortage products. We have an oncology portfolio and creatively working with oncology groups to have longer-term contracts, so we can supply them 20-25 products, so they don't run out of onco product for long term. So with this broader capabilities, almost 70 million units we can produce of different forms, and these are complicated. I was just in India last week. I saw one of our products, which is a peptide. I mean, it's a hormone microsphere-based infrastructure. It's a specific infrastructure just for that product, and it's extremely complicated. So it's fun to come with all the. It's the same rigor we brought in retail GX with the technologies. Mm-hmm. We're doing it in injectables, and whenever we enter the segment, we're here to stay. So we easily see ourselves going over $300 million in 2025, publicly stated. Just from injectables? Just from injectables. Okay. It will keep growing. So that segment is, and then international is additional opportunities within injectables. Are you planning additional expansion of your capacity, of your manufacturing capacity for injectables? Can you talk through that? We have enough right now. You have enough. Okay. We got great 4 plants, and we're doing good. We may add 1 additional couple of lines in the United States- Mm. That's about it. Okay. But we have enough to manage through the pipeline. We have 30 products or so we commercialize today. We have 30- Mm-hmm in pipeline, so we can manage up to 27. What's your current annualized top-line contribution from injectables now? You talked about the $300 million longer term target. What's the revenue footprint right now? And, you know, I don't want to pin you down on 2024, Yeah. B ut, you know, how many approvals of injectables do you think you could be getting next year? We about 10 approvals, and it's- Next year? Moving in the right. Yes. Yep. This year we had 10 approvals. Okay. So it's, it's moving up. It was 2022, we did $180 million in net sales. So that whole segment is really a growth driver for us. Got it. Shortages, big topic for injectables. And you have called out a few approvals. You mentioned propofol as an example of a shortage product. I know there are others. How big of a priority is the development and distribution of products that are on shortage? I mean, you talked about complex products, but there's a role here for shortage- Yeah. And I wanted to hear your latest thinking there. Yeah. So we're all always mission-driven, so we like to help in shortages. And so what we have done is taken an approach and identified. We just got approval for calcium gluconate, so all the electrolytes, all those bags are always in shortages. So we've worked on the entire portfolio just for the patients and hospitals and entering into longer-term contracts. As we have a siren in the background. Yeah. Yeah, exactly. So, and, and then the onco portfolio, we're diligently working to come up with the 2025 products out of 30 or so products used, pretty much majority. Mm-hmm. And offer that for a five-year contract or seven years. We cannot be held hostages by the middlemen with changing the pricing and formularies. So we a nd, and customers are very eager to sign up. So we have complex plus shortages- Okay. plus some volume, because you need to run the plants and get the overhead absorbed. Just one more question about shortage products. This has been pretty persistent, going back a number of years. Is it your view that these shortage issues are likely to continue, where you'll be in a good position to step into the void? Yeah, unfortunately, they will continue because the older plants, there are many- Mm-hmm. U nfortunately, have to be either decommissioned or completely redone. Right. So we've been hearing about new capacity coming, coming, coming, and injectable is not easy. Sure, sure. Oral solids or even the products like transdermal and all those, you can change it quickly. Injectables, it's a whole line, takes longer time. Mm-hmm. The sterile products, right, so FDA requirements are at the top, and you have to constantly maintain and upgrade your equipment. Mm-hmm. So that this is why, unfortunately, the shortage and economics that the GPOs and the distributors and hospitals have set it up. The $2 a vial, $3 a vial, these are not sustainable. Right. Even FDA commissioner said that. Right. So those, what happens, it gets concentrated in one or two companies- Mm-hmm for market share, and now they have quality issues because they did not have money to invest. Yep. That causes the shortage. Okay. So no, that's very helpful and definitely something to watch over the next few years as it relates to your business. So on the generics business, more broadly, you've talked a lot about your pipeline and your movement away from oral solids. So can you talk more specifically about how much of your pipeline, not your filed products, but your actual pipeline, consists of products that are not oral solid formulations? And then I have a couple follow-ups. Sure. Yep. So today, our retail generics- Mm-hmm which is the injectables, separate, and is part of the whole Affordable Medicines Group. Mm-hmm. It's the retail GX is about $1.3 billion business. We're fourth largest, and we're moving up in values. Mm-hmm. and the growth driven in that $1.3 billion segment, and this is all United States revenue. International will add, but within United States, the inhalation products, ophthalmics products- Mm-hmm. So 90% of our, 90, pipeline is non-oral solids. Mm-hmm. Within 1.3, only $600 million of sales are oral solids. But those are well-established oral solids. We still make money, and- Mm-hmm A nd we have the right infrastructure just to produce what we need. So we are not wasting our time shutting down plants- Right like our competitors had to do. Sure. So as you look at that base of oral solids business, that's $600 million, and even non-oral solids, non-injectables, I'm interested in how you're thinking about price erosion going forward. I mean, we know that the environment is not nearly as bad as what it was a few years ago. Maybe less bad, as I like to use that term. But as you look at 2024 and 2025, what's your view on pricing erosion of the at least in the oral solids? There are two components. Yeah. One is price erosion. Yep. The second is volume gain. Sure. Surprisingly, this year, we did have price erosion, but the volume gain offset the price erosion, and we had increase in a base business, which we classify as pre-2019 products. So that dynamic, because of shortages, right, one-time buy, all that matter. But it's still price erosion is, like 8%-9%, and it used to be 12-13. Mm-hmm. Now, we expect that it should normalize back to 2010-2017, which was 5%-6%. Okay. Now it depends for the company specific- Sure. Because if you're launching many first to markets, you're going to have more competition. You're gonna have growth. So, uh- Okay. So the erosion is moderating- Yep. But you're seeing more volume growth? Because of the credibility and like company like us with 100 inspections- Mm-hmm. No warning letters ever. So number one quality track record in the industry. Supply chain is almost at 99.7%. I mean, it's so high. Mm-hmm. Customer trust is so much. Sure. And then, other companies are fumbling, we're stepping up and providing those one-time buys. Okay. So you talked about I think it was about 10 injectable approvals this year, maybe another 10 next year. Just looking more broadly at the generics pipeline, you had a lot of approvals this year. What's your outlook for 2024 in terms of number of approvals for the- 30 to 40. In twenty- About 10 injectables- Mm. -and 20, 30 non-injectables. Okay. In terms of- Any big first to market opportunities? Oh, they're good ones. They're good ones. And most of them. Yeah. Biggest, this, the exciting one nearby is, and then again, mission-driven is Naloxone. Right. We have built up a capacity for 10 million. It all goes online, 12 million, actually, units by next year. It's right now at 3-4 million, but the machinery is being installed. Mm-hmm. We expect that approval anytime. Okay. So let's switch gears a little bit to biosimilars. So you have three. Just remind us what your revenue footprint is for, for those three. And as you, you look at this space, more broadly, how are you envisioning, the growth of your biosimilar footprint over time? Great. So the first one is, we are doing good. Our goal was, as Amneal, to set the commercial front. Mm-hmm. We have done that successfully, got a 6% market share in three quarters for our leading product, ALYMSYS, Avastin biosimilar, and Neupogen and Neulasta is following the similar paths now, and we expect those portfolio to do more than $140-$150 million next year. Mm-hmm. And then $200 million by 2025. So as we publicly said, we will reach those goals with those three. We in-licensed two more. Mm-hmm. Perolea and Nexiva, which we'll be launching sometime in 2026. There's a couple more we haven't announced, which is in works for in-licensing. So that will keep building the oncology portfolio. We may deviate from there if we get the products, which we are only one of three or one of four biosimilars- Mm-hmm and not go into these 8, 10 category. Right. Which are only a few, like- You're not gonna be in the Humira market. No, no. Okay. But we, the other products which could be in autoimmune, but- Mm-hmm If we are first, second, third. Mm-hmm It's a big, big market. So this United States, the prices start high. Mm-hmm. Even 80% erosion, it's a great business. It could still do $200 million in revenue, so which are very large for $2.4 billion base company, large amount. Biosimilars will grow. Five years later, the companies would have to be vertically integrated. Right. None of the, just the front end would survive. They have to be global. So that brings me to my next question, you're not quite there. It's shared economics. So nowadays, that might work, and you said five years from now, it might not work. Yep. So what does that mean for Amneal? For Amneal, would have to be over 5 years- Yep B ecome vertically integrated. Right. have a global pipeline. So we are out-licensing in South America and Middle East and most likely selling on our own in Europe. Mm-hmm. So we would have to because there's a global demand for these products. Right But it's amazing business. Does that include R&D capabilities as well? Yeah, yeah. Okay. Everything. Okay. You have to have A to Z. Okay. Okay, that's helpful. How are you looking at how pricing will behave in the biosim space? I mean, are you looking at biosims behaving more or less like complex small molecule generics over time? No, no, no. No? No. Or, or better? Oh, of course, better- Yeah B ecause it's just whole manufacturing and R&D- Right. I s so complicated. Okay. You keep seeing that, like, product like ZOLED had, like, nine people working on it. Only three are in phase three right now. Right. It cuts down. The cost is $150 million versus $10-$15 million for complex generics. So cost is 10 times higher, may take $200 million to develop a product. It's a 6-7-year journey if you do it right, this is for the United States. Europe, maybe MHRA may be a little faster. Mm-hmm. And then you've got a complicated manufacturing. Manufacturing is biologics. Mm-hmm. Sure. It's not a slam dunk. Sure. And then you have complicated commercialization in the United States, so it will not behave like complex CX. It's gonna be more, you will see different categories behaving differently. The medical benefits versus the PBMs, and number of players coming in, the supply continuity, all this will matter. What are your margins like for your biosimilars business now relative to corporate margins? It's better. It's better. Even with the shared economics. Okay. If you are integrated, you're going to maintain the better margins and improve. Okay. So let's switch gears. We have about six minutes left. I wanna make sure we talk about the brand business. Yes. IPX203. Yeah. I know you met with the FDA recently. Can you just talk to that meeting and what you need to do or how already have done to get to the NDA resubmission? So we had a great pre-NDA meeting- Yeah. A nd they had laid out that you're using more carbidopa, so we need 100 patient safety. We did it. We had provided them. They needed further clarification. We clarified, "Here you go, 170 patient safety data, not even 100. Yep. They checkmarked. They're okay with it. Sure. But they said, "We'd like you to do the routine QT study- Okay. -for 36 patients." We're about to complete, and then the analysis takes more a couple of months. Mm-hmm. We'll be filing early next year, and that's it. That's the last open remaining question. So it's just a thorough QT study. That's it, for carbidopa only. Just for carbidopa? Yeah. Okay. Which hasn't shown any QT impact ever in 50 years- That's just because there's more carbidopa- Initially- Initially. Yeah. I t's designed that way, so- Sure. T he patient is not struggling in the morning. Yeah. Right? So it doesn't, they don't fall down. They're doing their t hey can drink their cup of coffee- Mm-hmm. T ake their medication, read their newspaper, walk, walk around. So that's why it's designed. It's very smartly designed. It's completely novel formulation than RYTARY. So let's talk about the value proposition versus RYTARY. I'm particularly interested in, well, two things. One is the pill burden, the daily pill burden, It's abused. S o talk about that with some specifics. And then secondly, do you expect that with the different kinetics, you could see better motor control? Well, we'll do those further studies- Yeah. L ike phase IV. We plan to do those- You do. Okay. Okay. Continue to do the studies. But right now, what we have seen, and the investigators, is amazing, and it's 2-3 times a day for pretty much most of the patients. Mm-hmm. But it's not just the pill burden, it's quality of their life is improved all day long because they're not going on and off episodes. Mm-hmm. So they can do their consistent activities, they're less accidents, and have a life because- Sure. T hey live fortunately very long time with the, with motor fluctuation. But we'll see. I think like we are going—we plan various studies to see how if you start early on a nd we're going after the entire market this time. Right. We're not going after just the movement disorder, 5% market share. Sure. We're opening up. Does that mean you're gonna add more headcount to the neuro sales force? No, I don't think we need to add more headcount. We have designed beautiful marketing strategies on social medias- Mm-hmm. D ifferent demographics, right? So reaching out, the payer access, that's the biggest issue. Yep. Half of our prescriptions in RYTARY don't get filled because of the price issue. Okay. Does that mean you price 203 more cheaply to access a wider part of the market? We're not talking publicly yet- Yeah. B ut we're negotiating. It will be priced where we have more access for patients. Okay. That's the ultimate goal, right? Give more access. Okay. 55%-60% are on Medicare. Yeah. Okay. Wanted to move on to just your vision for the brand business more broadly. You've done some, you know, in licensings, acquisitions. You've got a neurology vertical. You've also got Unithroid with your endocrinology business. Yeah. How are you thinking about ways to bolster your brand business and ways to better leverage your commercial infrastructure? Yes. So we're looking at any commercial assets that can fit in PD. Mm-hmm. That would be just add on- Mm-hmm. B ecause our sales team can handle 2 products, 2-3. Mm-hmm. So that would be just natural additions. So hopefully, we announce something soon, and then we would have the pipeline. In PD, we are looking at, always been looking at everything that is happening- Okay. I ncluding the gene side. We're not touching, but we're learning what's going on. Okay. T he 10%-15% patient has one gene that- Yep. Y ou can modify. But then there's the other one that can levodopa-induced dyskinesia. Can you—is it, is it a better product than Gocovri? So those kind of things we always look for. Okay. Interesting. So we are there. Yeah. Anything we look at it, I mean, we get into that business, we are completely in it. What about endocrinology? Endo is great. We got Unithroid is great- Yeah. A nd looking at other assets. Okay. We already have, in pipeline, we have K114- Mm-hmm. W hich is, if it works out, it could be the newest form after 25 years, combining T3 and T4. Mm-hmm. How large of a transaction can you do, or what's your wherewithal? We have CFO sitting right here. Yeah. He watches me every time. We're just gonna pay down the debt. I saw you just put couples just parked out. We have a great pipeline- Yes A nd can't wait to get to the below 4- Mm-hmm. A nd then keep going to below three. So, we would do what we can do with our operating cash flow, which is awesome, every year, and manage with our discipline approach. Okay, last question, because we're just about out of time. You talked about getting below 4. Do you have a timeline on when you can get there? Yep, by end of 2025. Okay, and then getting to below three? That's our goal there, but maybe whatever, 26, 27. Okay. That's helpful. All right, Chirag, thanks so much for joining us. Thank you in the audience. Thank you. Okay.