Greetings, and welcome to the Collegium Pharmaceutical Second Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note that this conference call is being recorded. I'll now turn the call over to Christopher James, Vice President of Investor Relations at Collegium. Thank you. You may begin.

Welcome to Collegium Pharmaceutical's second quarter 2024 earnings conference call. I'm joined today by Mike Heffernan, our Interim President and Chief Executive Officer, Founder and Chairman; Colleen Tupper, our Chief Financial Officer; and Scott Dreyer, our Chief Commercial Officer. Before we begin today's call, we want to remind participants that none of the information presented today is intended to be promotional, and that any forward-looking statements made today are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. You are cautioned that such forward-looking statements involve risks and uncertainties, including and without limitation, the risks that we may not be able to successfully commercialize our products, that we may incur significant expense in doing so, that we may not prevail in current or future litigation pertaining to our business, risks related to our ability to complete the acquisition of Ironshore Therapeutics on the proposed terms and schedule or et al, risks related to our ability to realize the anticipated benefits and synergies of the proposed acquisition of Ironshore, the risk that the business will not be integrated successfully, risks related to negative effects of this announcement or the consummation of proposed acquisition on the market price of our common stock and/or operating results, and risks related to future opportunities and plans for Ironshore. These risks and other risks of the company are detailed in the company's periodic reports filed with the Securities and Exchange Commission. Our future results may differ materially from our current expectations discussed today. Our earnings press release and this call will include discussion of certain non-GAAP information. You can find our earnings press release, including relevant non-GAAP reconciliations, on our corporate website at collegiumpharma.com. I will now turn the call over to our Chairman, Interim President and CEO, Mike Heffernan.

Thank you, Chris. Good afternoon, and thank you, everyone, for joining the call. Today, we'll discuss Collegium's financial performance during the second quarter and provide an update on our progress in 2024. At Collegium, we are focused on building a leading diversified specialty pharmaceutical company committed to improving the lives of people living with serious medical conditions while striving to do good as we do well. I'd like to recognize the Collegium team for their dedication to our mission and community impact, as well as their strong performance in support of our pain portfolio in implementing our capital deployment strategy in the first half of the year. Our results this quarter and through the first half of the year reinforced Collegium's strong operational execution. We continue to generate robust operating cash flows and drive significant top- and bottom-line growth in our pain portfolio, including growing revenues 7% and adjusted EBITDA 12% on a year-over-year basis in the second quarter. Through execution of the Hikma authorized generic agreement and securing the six-month pediatric exclusivity extension for the Nucynta Franchise, we are maximizing the value of this portfolio through 2025 and beyond. The strength of our pain business positions us to execute on the recently announced proposed acquisition of Ironshore Therapeutics, including its commercial product, Jornay PM, a central nervous system stimulant for the treatment of attention deficit hyperactivity disorder, or ADHD, in people six years of age and older. The Ironshore acquisition meets all of our business development objectives. Jornay PM is a highly differentiated commercial asset that diversifies our portfolio, has significant revenue and growth potential and exclusivity into the 2030s. Jornay PM is expected to generate net revenue in excess of $100 million in 2024, expands our commercial presence into ADHD, a large and growing market and is poised…

Thanks, Mike. Good afternoon, everyone. In the second quarter of 2024, we generated top- and bottom-line growth, executed on our capital deployment strategy and improved the outlook for our pain portfolio in 2025 and beyond. Recent key accomplishments and highlights include: We delivered another strong quarter for Belbuca, with prescriptions up 2.1% year-over-year and 1.4% quarter-over-quarter, coupled with record quarterly Belbuca revenue, up 21% year-over-year. We grew Xtampza ER revenue 8% year-over-year, with gross to net of 56.2% in the second quarter, reinforcing the success of our contract renegotiation strategy. We bolstered the value of the Nucynta Franchise in 2025 and beyond through our authorized generic agreement with Hikma Pharmaceuticals and the six-month pediatric exclusivity extension for the Nucynta Franchise, extending the exclusivity of Nucynta to January 3, 2027, and Nucynta ER to December 27 , 2025. And we executed on our capital deployment strategy, including announcing the proposed acquisition of Ironshore Therapeutics, which will establish Collegium's presence in the large and growing ADHD market and diversify our portfolio with a meaningfully differentiated product that is poised to become our leading growth driver, securing attractive financing for the acquisition of Ironshore with terms that reduced our cost of capital by 300 basis points and enhanced flexibility in the management of our debt, redeeming all $26.4 million aggregate principal amount of our previously outstanding convertible senior notes due in 2026 and returning $35 million in capital to shareholders through an accelerated share repurchase program, repurchasing 1.06 million shares at an average share price of $32.94. Our second quarter performance reflects record Belbuca revenue, disciplined expense management, significant bottom-line expansion and robust operating cash flows. Financial highlights for the second quarter include: Net product revenues were $145.3 million in the second quarter, up 7% year-over-year. Belbuca net revenue was a record $52.2…

Thanks, Colleen. At Collegium, we take pride in being a leader in responsible pain management with a unique and differentiated portfolio of products for the treatment of pain. Belbuca, Xtampza ER and Nucynta ER collectively command over half of the branded ER market, demonstrating the ongoing strength and reach of our portfolio. Our commercial organization is focused on continuing to drive momentum for our products in order to make a positive impact on the lives of people living with pain and the communities we serve. Belbuca continued to grow in the second quarter. Prescriptions grew 2.1% compared to the second quarter of 2023, marking the fourth straight quarter of year-over-year prescription growth. We're encouraged by this consistent prescription growth, including 1.4% growth in the second quarter compared to the first quarter and the impact that our strong commercial execution is having in the marketplace. We believe Schedule III products should be used before Schedule II and used more broadly. Belbuca is uniquely positioned because of its clinical differentiation as a Schedule III product with a broad range of doses for the management of severe and persistent pain that requires an extended treatment period. Our commercial team is focused on delivering this message to healthcare professionals and building upon our commercial execution. Our priorities for Belbuca include pulling through Belbuca's strong commercial access, improving push-through in Medicare Part D and expanding Medicare Part D coverage. Belbuca revenue growth in 2024 is expected to be driven by prescription growth. Xtampza ER prescriptions were stable in the second quarter and in line with our expectations. We expect revenue growth for the full year to be driven by improved gross to net. We're committed to educating physicians on Xtampza's differentiated label, pulling through our strong access position in commercial and Part D plans and…

Thanks, Scott. We are at a transformational time for Collegium. We are on track to deliver record financial performance this year as we maximize the value of our pain portfolio and deliver on the growth with Belbuca and Xtampza ER. With the addition of Jornay PM upon closing of the Ironshore acquisition, we are expanding into a new therapeutic area with a differentiated product that is poised to become our leading growth driver. We are confident in our ability to achieve our strategic and financial commitments in order to create value for shareholders. With a solid track record of execution and success, Collegium is well positioned for future growth. I will now open the call up for questions. Operator?

Thank. So, just have a couple. First, on Belbuca, and I joined late, so I apologize if I missed this in the prepared remarks, but can you talk about how you're thinking about improving Medicare Part D access for that product beyond this year? And just remind us what covered lives on Part D currently looks like? So that's number one. And then secondly, in terms of the acquisition and the focus on ADHD and calling on psychiatrists, how do you think about additional transactions over the long term as you delever, as you're generating cash now that you're in this new therapeutic vertical? Would it be safe to say that you're going to look for additional assets that leverage the infrastructure that you're going to have in place? Thanks.

So, Scott, do you want to take that first question? Thanks, David, for the questions.

Yeah, that's great. I'll take that. Thanks, David. So yeah, so first and foremost, if you look at the current position of Belbuca, it's covered for about 30% of Medicare Part D lives. And as we look going forward in terms of improving that coverage, look, the focus is the clinical profile of the drug. We believe that Schedule III should be used before Schedule II and used more broadly and that patients should have full access to the differentiated profile of Belbuca. So that's what we're engaging payers with is that clinical data, the data that only keeps getting stronger. And then, we'll see where the dust settles when we get to November if we're able to achieve new wins in an economics that works for us.

Great. Thanks, Scott. And on the second question, David, about acquisition strategy going forward, I mean, clearly, we're going to be focused in the short term on integration and then growing the Jornay business, which will take a significant amount of effort. Subsequent to that, we'll be calling on a mix of pediatrics, neuropsych. So, we will be sharpening our BD focus around those particular focus areas, which gives us a lot of optionality. And as you suggest, we will be looking to create synergy and as we build the business development strategy going forward.

Okay. That's helpful. Thanks.

Thank you. [Operator Instructions] Our next question comes from the line of Les Sulewski with Truist Securities. Please proceed with your question.

Great. Thank you for taking my questions, and congrats on the quarter. How do you balance the integration versus maintaining the performance you've been able to achieve across your current portfolio? And then second, on the update on the CEO search, has the Ironshore acquisition changed the focus on the potential candidate selection? Thank you.

Yeah. Thanks, Les, for the questions. From the standpoint -- I'll take the CEO search question. So the CEO search, as I mentioned in my comments, is ongoing and active and making good progress. And we've seen some really good candidates. Frankly, if anything, this has increased the interest because of the growth potential when we bring Jornay into the portfolio. So, we remain very focused on finding a top-tier candidate, and this has not changed the strategy at all. Scott, do you want to take the first question?

Yeah, sure, Mike. Yeah, thanks for the question, Les. And in terms of balance, it's very simple. We will maintain 100% of our pain sales force, marketing teams, the core commercial people focused on pain. And then, we will integrate a fully commercialized Jornay team in that sales force, and there will be no overlap. Each will be focused on what they're responsible for, the pain group with continuing to maximize the value of that full portfolio of pain products and the Jornay PM team continuing to focus on the growth trajectory that's been started for Jornay. So that's our approach is really just keeping complete separation in our commercial efforts.

Great. Thank you.

Thank you. [Operator Instructions] And it looks like we have reached the end of the question-and-answer session. And I'll turn the call back over to Mike for closing remarks.

Thank you, everyone, for joining the call today. Have a great evening.

And this concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.