Halozyme Therapeutics, Inc. (HALO) Q3 2013 Earnings Report, Transcript and Summary

Ladies and gentlemen, welcome to the Antares Third Quarter 2013 Operating and Financial Results Conference Call. [Operator Instructions] I will now hand the conference over to Jack Howarth, Antares Vice President of Corporate Affairs. Please go ahead.

Thank you, Julie, and good morning, everyone. Thanks for joining us on today's call. We announced third quarter 2013 operating results and recent achievements earlier this morning, and the press release can be found on the Antares website at www.antarespharma.com under the Investor Relations tab. Before we begin, please be advised that during the course of this call, we may make forward-looking statements concerning the company that historical facts. These forward-looking statements may include, but are not limited to, statements concerning the timing of product sales, market estimates, market potential and growth prospects, technology platforms and working capital needs. Forward-looking statements provide Antares' current expectation or forecast of future events. Actual results could differ materially from those reflected in these forward-looking statements due to decisions of regulatory authorities and Antares' ability to execute on its development plans, capital needs and general financial, economic, regulatory and political conditions affecting the pharmaceutical industry generally. Additional information concerning these risks and uncertainties are contained in the Risk Factors section of Antares' annual report on Form 10-K and in Antares' periodic filings and other filings made with the Securities and Exchange Commission. Antares is providing this information as of the date of this release and does not undertake any obligation to update any forward-looking statements contained in this earnings call as a result of new information, future events or circumstances after the date hereof, except as required by law or otherwise. The company cautions investors not to place undue reliance on these forward-looking statements. Joining me on the call today are Dr. Paul Wotton, President and Chief Executive Officer; Robert Apple, Chief Financial Officer and President of the Parenteral Products Group; and Leroux Jooste, Senior Vice President, Pharmaceutical Sales and Marketing. After the presentation, we will open the lines for Q&A. I'll now turn the call over to Paul Wotton. Paul?

Thanks, Jack, and good morning, everyone. I'm pleased to report to all of our stockholders on our progress since the last quarterly update call. And as you can see from today's announcement and the significant announcements we've made over the past few months, Antares is now positioned to enter 2014 with the launch of OTREXUP, the first of what I believe to be many product opportunities that we will create using our core technology. It's been 5 years since we embarked on a strategy to turn a great but underappreciated technology platform into an innovative and proprietary product pipeline that will underpin the growth of the unique specialty pharmaceutical company. Now, the OTREXUP approval represents a pivotal event in the development of our company. This product's approval by FDA demonstrates both the validation of our technology platform, as well as the development pathway that we have chosen. OTREXUP took just 3 years to complete between IND filing and NDA approval. At the same time, we've also been able to implement robust management processes to capture the essential elements of innovation in every aspect of our business that I believe are necessary for success. We have built a 505(b)(2) machine with numerous products opportunities underpinned by broad intellectual property protection. And this ability to create economic value by developing good medical products will continue to drive our success especially when coupled with an organizational culture that strives to be the best and is focused on creating long-term shareholder value. Now if 2013 was fast paced then 2014 will be an even busier year for Antares with the launch of OTREXUP early in Q1, and our QS T program under development for testosterone deficiency or low T entering its pivotal clinical studies in preparation for potential NDA filing in 2015. Let me begin today's call with a high level overview on where we are with respect to OTREXUP and then I will ask Leroux Jooste to provide more details with the commercial update. We're off to significant labeling negotiations. The FDA notified us that the OTREXUP product have received marketing approval, ending a productive and interactive 10-month review process for the agency. Our approval announcement represented a strategic milestone for the company because as I stated earlier, the approval of OTREXUP also validates our preparatory VIBEX Medi-Jet platform. It also underlined our ability to get an NDA approved for drug device combination products in a timely manner. The credit not only goes to the FDA but to the whole of our team here at Antares as well. And I want to thank them for the endless hours they worked fielding requests for information regarding the application of final label insert, a package insert that we believe is favorable from a commercial standpoint. There are numerous published peer reviewed literature examples mainly from Europe showing utility of subcutaneous methotrexate in the treatments of conditions such as rheumatoid arthritis or psoriasis. And the medical community is well aware of this. For the first time, Antares showed that systemic availability of OTREXUP, when compared to oral methotrexate exposure, increased in a dose dependent manner, at doses of 15 milligrams per week and higher, whereas oral administration shows a plateau effect. And this plateau has been included in our label. The psoriasis label language also includes a section that the use of OTREXUP may permit the return to conventional topical therapy, which should be encouraged. And from a commercialization and messaging standpoint, we are very pleased with the final package insert that we received. While the Antares medical and regulatory people were working on the OTREXUP label, the commercial team continued to work on the launch plans. The commercial launch will place -- take place early in Q1 2014, and we are making great progress towards this goal, which Leroux will discuss a few moments. And one of the points I'd like to emphasize is that we will be going into this launch as well-prepared as possible and with the best resources in place that we can find as evidenced by the recent appointment to the management team of Dr. Bruce Freundlich, a highly regarded rheumatologist with vast industry and academic experience in this field. Professionals like Bruce with varied interests and many choices available only take positions when they can see that their own vision, driven by the desire to enhance patient lives significantly, is matched by the vision and drive of the organization that they are joining. Now, over 18 months ago, we began to assemble a highly experienced commercial team here at Antares. And given that this is our first launch, I thought that it was important to hire the best commercial professionals in the rheumatology space. We did just that. The Antares commercial team that's been assembled here has over 100 collective years of broad healthcare and rheumatology product launch experience. Whether it's sales, marketing, medical publications or managed markets, the team has first-hand experience in launching rheumatology products, specifically, biologics such as Enbrel or Orencia. So they really know the space and they know all of the players in the field. Currently, we now have 3 district managers in place, 6 medical science liaisons and 6 national account managers appointed. At this point, we are recruiting our sales force. A good point now to hand over to Leroux to update everyone on the progress we are making towards the commercialization of OTREXUP as we enter the final strait. Leroux?

Thank you, Paul, and good morning to everyone listening. And thanks Jack and Paul for the first time you actually pronounced my last name correctly, although I think I'm totally happy with anyone calling me Leroux. What I'd like to do is update everyone on where we are with our launch plans, our marketing initiatives and managed market discussions that we've been having since June. And now most importantly, we will be prepared and ready to launch OTREXUP in January. We've established a very experienced commercial leadership team, including strong rheumatoid arthritis capability in managed markets in marketing and sales, and more importantly, also now in rheumatology with Dr. Freundlich joining us. And these are all Antares' employees. Through our partnership with Quintiles, we've embedded a fully dedicated Quintiles management team within Antares, and all the field personnel are also fully dedicated to OTREXUP, with 6 managed market account professionals who have been calling on managed care organizations third-party payers since June. And in September, we deployed 6 fully dedicated medical science liaison professionals and they have already initiated dialogue with many key opinion leaders in rheumatoid arthritis. They also attended the American College of Rheumatology meeting in San Diego last week, and were able to catch up with many of their old colleagues and friends. The OTREXUP salesforce will only promote OTREXU,P, and 3 dedicated district sales managers are currently interviewing candidates for the 25 sales representative positions. Now we had more than 500 applications and many job offers have already been made. Several have also accepted. And the scope and depth of these candidates' experience will result in a very competent salesforce of professionals with extensive experience in rheumatoid arthritis. We expect to have all the 25 positions filled by Thanksgiving with training slated to start in December. On the managed market fronts, where I'm sure you all of you are very interested to learn about our progress, we've developed and already started to implement a compressive strategy for access and third-party reimbursement. And so far, the results have been very encouraging. The feedback indicates strong recognition and acceptance of the OTREXUP value proposition. In fact, most rheumatologists and third-party payers are keen to know more about treatment options that may delay the use of more expensive drugs in many RA patients when oral methotrexate no longer provides an adequate response. The pricing strategy for OTREXUP has been validated by feedback from last month's Association of Managed Care Professionals Meeting in San Antonio, but also from several managed care organizations and third-party payers that we've been talking to since the FDA approval. Of course, we can only speak about OTREXUP and pricing following the approval. Now our discussions with pharmacy and medical directors suggest that most likely, initial access to OTREXUP will be at tier 3, and several plans I've mentioned the possibility of tier 2 placement. I can also confirm today that last week, we met the deadline for mandatory Medicare and Medicaid state coverage effective January 1, 2014. On the marketing front, we have leveraged the team's established and strong relationships with many of the top key opinion leaders in rheumatology to create awareness of subcutaneous methotrexate utility, and more importantly of OTREXUP and to strengthen the body of clinical evidence supporting the use of subcutaneous methotrexate. We've made tremendous progress in analyzing several rheumatoid arthritis databases, both in Europe and in the U.S., to develop new publications that support the use of subcutaneous methotrexate. Our advisory board and key opinion leader advisers have validated the positioning and messaging for OTREXUP, and we will have a national speaker bureau of 20 to 25 influential rheumatologists soon after the launch of OTREXUP. There was quite a buzz around OTREXUP at this year's American College of Rheumatology meeting held last week in San Diego. Now prior to the American College of Rheumatology meeting, we had an advisory board meeting with 18 influential rheumatologists. And at the American College of Rheumatology conference, we presented data from the OTREXUP studies during poster sessions. Dr. Mike Schiff of University of Colorado, also highlighted the subcutaneous methotrexate order injector blood label data versus the old methotrexate plateau during a podium presentation in a clinical session. I'd like to briefly discuss some of the key marketing messages and initiatives we will begin to deliver to healthcare professionals once the product is launched at the end of January. OTREXUP can optimize treatment in many patients who have not achieved an adequate response to oral methotrexate. OTREXUP enhances and extends the clinical utility of methotrexate through increased bioavailability and improved tolerability. OTREXUP also provides a state-of-the-art auto-injector system for methotrexate delivery. The VIBEX Medi-Jet device has been shown to be easy-to-use and virtually painless. It is very important that the initial patient nurse and doctor experience with OTREXUP is a positive experience. A first impression in-office support program has been designed to assist in educating patients on OTREXUP, facilitate self-administration training, provide a sample for the first dose, as well as a co-pay assistant card and a free program for responsible disposal and recycling of this device. We've been busy, but it's been fun and satisfying, especially because of the interest and excitement we see and hear when talking to rheumatologists and third-party payers. Reminds me a lot of my experience when Enbrel was launched, only this time, we're talking about methotrexate, the anchor drug in rheumatoid arthritis. And, far more than a decade, actually 2 decades, but it still creates a buzz. I shall now hand you back to Paul to summarize some of the additional progress we've made in the past few months.

Thanks, Leroux. I'd also like to emphasize on this call that we continue to make progress on all of our pipeline projects, including those partnered with Teva. But today is all about the progress we've made recently on our internal pipeline, which will drive the future for this company. And so consequently, I want to take a minute to update you on another program in the clinic, which has become somewhat overshadowed by the OTREXUP news, but which is in every way just as important. On September 16, we announced that the first patients have been dosed in our QuickShot testosterone study in low T males. This dose-ranging study is designed to evaluate testosterone enanthate administered weekly by subcutaneous injection at doses of 50 milligrams and 100 milligrams. Dosing of patients using QS T is fully enrolled and ahead of schedule and initial reports back from the sites confirmed that our belief that the QuickShot device is delivering accurate and convenient injections of the drug, which is formulated in a viscous vehicle in less than 5 seconds, which is quite an achievement in its own right. I can also report that the initial data that I have seen just last week indicates that in the first few patients, we've obtained blood level curves of testosterone consistent with endpoints that we were targeting, and designed to smooth out the peak to trough ratios seen with other injectable forms and appear similar to those seen with daily applications with gel. Complete results of this study should be available early in the first quarter next year, but the early signs are looking good and I'm extremely encouraged by this program. I also stand by my belief that we will be ready to launch this product in 2016 based on the current timelines, which were based on solid experience that we have gained from our OTREXUP development program. I'd also like to highlight progress we've made in obtaining new intellectual property around our drug device combination products. We started an aggressive patent strategy 5 years ago when this management team took over the company. We are starting to see the fruits of this strategy today. In the past few months, we received 3 new patents that will cover OTREXUP, as well as other pipeline projects, and I expect this rate of productivity to be maintained. Antares is one of the pioneers in injectable technology, and in fact, has auto-injected patents dating back to 1999, which means we have a comprehensive base from which to grow. The OTREXUP product itself is now protected by at least 7 different patents going out as far as 2030, and we shall make sure that this IP estate is enforced aggressively over the long term. And one final expanded thought on intellectual property. We believe that the IP work done here at Antares -- and I think it's one of our most valuable assets -- is good. As an example, the hazardous agent injection patent system was granted in late June. This patent was broad, as well as comprehensive, and covers, among other things, our injection system with methotrexate amounting from 0.02 milliliters to about 4 mils in injection volume, another concentration of about 7.5 milligrams for mil 2, about 150 milligrams mil, as well as including things like needle gauge, injection outlet, firing mechanism, trigger mechanism, spring, et cetera. So you can see that we've covered OTREXUP with a patent that has broad claims that should protect the asset for a number of years. There are other patents pending as well, but this gives you some idea that we've spent plenty of time resourcing, protecting OTREXUP, QS T and QS M, which we're still working on, and it's fundamental to the strength of our drug device combination platform. I'm now going to turn the call over to Bob to comment on the third quarter and year-to-date financials. Bob?

Thanks, Paul. Before I get into the financials, I'd like to make a few comments regarding our third quarter and ongoing investments in the launch of OTREXUP and the QuickShot testosterone project. OTREXUP, or subcutaneous methotrexate for injection, is a novel way to extend the use of methotrexate when treating patients with RA or psoriasis. In addition to hiring a sales force, investments in other launch activities, including publications utilizing historical subcutaneous treatment data, must be made in order to educate rheumatologists, nurses, patients and caregivers as to the therapeutic importance of switching RA patients that fail oral methotrexate to OTREXUP. In clinical studies conducted by Antares, subcutaneously administered methotrexate shows greater bioavailability to oral methotrexate at doses of 15 milligrams or greater. You only get 1 chance to launch a product and we are committed to correctly investing behind this launch, as you can see from today's third quarter and year-to-date results. The same can be said for investments in our pipeline. This past quarter, we initiated, among other things, the first human study utilizing testosterone in the VIBEX Quick Shot device. We believe that QuickShot testosterone for testosterone-deficient males could potentially be another big prize for us. And so we will be investing in studies and manufacturing scale-up in order to stay on track for 2015 NDA filing. Turning now to our financial results. Total revenues were $5.5 million and $5.7 million for the 3 months ended September 30, 2013, and 2012. For the 9 months ended September 30, 2013, the company's total revenue was $15.9 million, compared to $17.1 million in the first 9 months of 2012. Product sales were $3 million in the third quarter of 2013 compared to $2.1 million in 2012, an increase of 48%. For the 9 months ended September 30, 2013, product sales increased 30% to $10.1 million, compared to $7.8 million in the prior year. The product sales increases were primarily due to sales through Teva, our VIBEX auto-injector for Teva's generic epinephrine auto-injector products. Development revenues were $1.3 million in the 3-month period ending September 30, 2013, compared to $2.6 million in the prior-year period. For the 9 months ended September 30, 2013, the company's development revenue was $2.7 million, compared to $6.3 million in the first 9 months of 2012. The revenue in the first 9 months of 2013 was primarily due to auto-injector and pen-injected development work with Teva. The revenue in the first 9 months of 2012 was primarily due to a non-recurring FDA approval milestone payment of $2.5 million recognizing connection with our license agreement with Actavis, along with development revenue from Teva. The development revenue in the 3- and 9-month periods of 2012 also included $750,000 from Pfizer after the achievement of development milestones related to our undisclosed Consumer Healthcare product. For the first 9 months of 2013, licensing revenues were $200,000 compared to $800,000 in the first 9 months of 2012. Licensing revenue in the third quarter and first 9 months of 2013 was primarily due to recognition of revenue deferred in prior years under agreements with Fera. The licensing revenue in the first 9 months of 2012 was primarily due to an upfront license fee received in connection with our licensing agreement with Daewoong Pharmaceuticals for our 3% oxybutynin gel for South Korea, along with license revenue recognized in connection with our license agreement with Actavis. Royalty revenues were $1.1 million in the 3-month period ended September 30, 2013, compared to $900,000 in the same period in the prior year. For the 9-month period ended September 30, 2013 and 2012, royalty revenues were $2.9 million and $2.2 million. We received royalties from Teva and Fera related to needle free injected device sales and/or HGH sales, from Actavis on sales of Gelnique and from Meda Pharma on sales of Olestra. The primary reason for the increase in the royalty revenue in 2013 compared to 2012, were royalties received from Actavis on sales of Gelnique 3% and 10%. Important to note that in the third quarter, we had significant growth in what I believe were the key areas of revenue: products, revenue and royalties. Total gross profit was $2.5 million and $2.4 million in the third quarters of 2013 and 2012, respectively, and was $7.4 million for the first 9 months of 2013 compared to $9.3 million for the first 9 months of 2012. The decrease in the first 9 months of 2013 compared to 2012 was mainly due to the non-recurring FDA approval milestone payment of $2.5 million from Actavis recognized as revenues for 2012. Total operating expenses were $8.9 million and $5.9 million for the 3 months ended September 30, 2013 and 2012, respectively, and were $22.3 million and $15.7 million for the 9 months ended September 30, 2013 and 2012, respectively. The increases were primarily due to an increase in OTREXUP commercialization and marketing activities in anticipation of an early 2014 launch, and increased development activity related to VIBEX QS T, which is under development for testosterone replacement therapy, along with an increase in personnel to support our growing pharmaceutical business. Net loss per share was $0.05 and $0.03 for the third quarters of 2013 and 2012, respectively, and was $0.12 and $0.06 for the 9-month period ended September 30, 2013 and 2012. At September 30, 2013, Antares is well-positioned with approximately $70 million in cash and investments, compared to approximately $85 million at December 31, 2012. I will now call -- turn the call back to Paul for some closing comments. Paul?

Thanks, Bob. So the company has just finished its first 5 year strategic plan under the current leadership. In fact, I took over the company on the same day as we received our OTREXUP approval just 5 years ago, and we are embarking on an even more aggressive plan for the next 5 years. We will continue to grow the organization with talented and experienced individuals being added, develop our pipeline, invest in expanded intellectual property and successfully execute on our launch plans for OTREXUP and all other potential products going forward that were approved. Finally, I would like to thank all of the dedicated professionals here at Antares, particularly those who worked on the product approval for OTREXUP, of whom there are many. It's a pleasure to work with the best group of people that I've ever worked with personally, and I look forward to continued success together in the future. Thank you, everyone, for your attention. I will now open the lines for your questions. Operator?

[Operator Instructions] Our first question comes from Louise Chen from Guggenheim Securities.

I had a few. So the first question I had was just on the launch trajectory that you're expecting for OTREXUP. Do you expect that to be a fast launch or something more measured? And then how should we be modeling the expenses in the fourth quarter and in 2014 to support the launch? And then second thing is just on your pipeline products, any update on your collaborative product with Pfizer, the OTC product? And then EpiPen generic, could you possibly get approval, like a tentative approval next year? And if you were to do that, would that tentative approval state whether or not it was AB-rated?

Thanks, Louise, I think I recorded about 4 or 5 questions there. So I'll delegate these out, but appreciate the interest. First, I think the first question you asked was about the trajectory of the launch for methotrexate. We're obviously gearing up to launch that product and you know that we are a fairly very conservative group here when it comes to making statements. But I'll ask Leroux just to comment on his feelings in terms of how the launch will go.

Thanks, again, for that question, Louise. I'm sure I'm not going to give you the specificity that you're looking for, but I can tell you that we're optimistic about access because of the discussions that we had with our third-party payers. We've already had discussions with payers that provide coverage for more than 200 million lives in the United States. And we've received feedback from them that they recognize the value proposition, that they will most likely put this product in Tier 3 with the co-pay at launch. And as time goes by and demand kicks in and they truly see the value being recognized in their plans that a Tier 2 positioning is likely in many of these plans. So we're optimistic about access and coverage. As far as the trajectory, we'll be calling on the top 2,500 plus rheumatologists who are responsible for prescribing in excess of 80% of the methotrexate prescriptions. So we'll be there with frequency. Feedback we've had today from all rheumatologists that we've talked to is an interest in the product, and they've definitely recognize clinical use in patients who have not had an adequate response to oral methotrexate. So it's really going to be a, what I would call, a steady uptake over time. One patient per office per week, or however you wish to look at it. But we have not yet modeled a specific trajectory. We are planning for success and we'll have adequate launch inventory at -- in fact, we have inventory for the full year, which is very important to our customers because they've told us they don't want to face the situation of being out of stock as they have been disappointed in the past, and they can't have their patients come back and say," I can't get hold of the prescription." So we're planning for success and we expect a very reasonable uptake.

Thanks, Leroux. Louise, I think you have one other question on the expenses in Q4, which I'll hand over to Bob.

Yes, Louise, I think from an expense standpoint, I think our R&D will be consistent from this period going forward for the next year or so as we move into the QS T development, essentially replacing the OTREXUP development cost. You're clearly going to see an uptick in sales and marketing costs next quarter as we get ready to launch the product and bringing in the sales force and so forth. So I'll expect to see that go up by basically about $0.02 per share on the cost standpoint. And then the rest of the line items will be consistent, pretty much flat.

Louise, I just want to clarify one thing, because I think that I may be misinterpreted. I may have given misguidance there. I think I misspoke and said 1 patient per week per rheumatologist. That is, in fact, not correct. That would be really good for us. So as I've said, we've not yet modeled something specific, but we would expect rheumatologists to consider patients on a monthly basis in their offices.

Louise, the other questions were on the Pfizer program?

Yes.

Yes. Actually, the only update I can give you there is that it continues to be on track and they are still, I believe, looking at the 2016 launch for that product. The EpiPen, we've been shipping materials to Teva. The only date we're looking at actually is the June 2015 commercialization date for the products. I do know that Teva made good progress on that program and we are still looking forward to the 2015 launch. And we actually, towards the other part of your question, we still believe that this is going to be an AB-rated product, period.

Would you know that at the time of tentative approval, if you were to get one?

Yes.

And do you have any update on your Advil Gel program?

Sorry? I missed the question.

Our next question comes from Akiva Felt from Oppenheimer. Akiva Y. Felt - Oppenheimer & Co. Inc., Research Division: With psoriasis being included in the OTREXUP label, I'm just wondering how you think about the different options available to capitalize on that?

That's a great question. We do have interest in that asset from partners who specialize in dermatology. And I would anticipate commercializing that with a partner. Akiva Y. Felt - Oppenheimer & Co. Inc., Research Division: Okay, great. And then maybe a question for Leroux. Could we get anymore color on the conversations with third-party payers? It's been only a few weeks since approval, I'm just wondering, how many of those meetings you've had? And sort of how the discussion has been going so far?

So we had a phased approach, Akiva, of -- as of June through the end of September, we focused on the Top 30 third-party payers in rheumatology who provide coverage for about 200 million lives. And we've had face-to-face meetings with 29 of these. So far, the only plan that is indicated as a matter of policy, they will not provide access in the first 6 months after approval is United. And this is only for those people who are fully insured, which is about half of the lives. So you have about 10 million who are excluded in the first 6 months after approval. However, with a late January launch, we will have already had 4 of those 6 months behind us, so we anticipate having access even at United. But all other plans, as I've said, have given us a very favorable response. And then as of the beginning of October, we've branched out and begun talking to an additional, what we call, second-tier third-party payers who cover about 30 million or so lives. And we've to date seen about half of those and similarly, have received very positive feedback. We've now also started having initial discussions with government payers where we can, and even there, we begin to get positive feedback.

[Operator Instructions] Our next question comes from Matt Kaplan from Ladenburg Thalmann. Matthew L. Kaplan - Ladenburg Thalmann & Co. Inc., Research Division: So just #1, congrats on the approval and more specifically, the broad label that you received for OTREXUP. Could you give a little bit more details, just diving a little bit more in terms of the positioning of the product? And also, a sense of pricing. How are you going to price the product as well? And I'll start there and have couple of other questions after that.

Thank you, Matt Kaplan. I'm going to hand this back to Leroux because he's so close to this one. He can give you much better answer than I can. So, Leroux, why don't you just go ahead?

Thanks, Matt. Let me answer the question on pricing. We have started discussions and disclosed to third-party payers that our wholesale acquisition cost will be $548 per prescription. And with that said, we continue to have positive feedback from third-party payers. Matthew L. Kaplan - Ladenburg Thalmann & Co. Inc., Research Division: And that prescription will cover what period of time?

That's 4 units, once a week, so that is a 4-week treatment period. Regarding positioning, it's straightforward. Any patient who has had an inadequate response to oral methotrexate, whether that would be for efficacy or tolerability, which is 95% of patients who end up on methotrexate at some other point in time -- excuse me, of those who discontinue or had additional drugs for either efficacy or tolerability, those are all patients that will be considered potentially treatable with OTREXUP. Matthew L. Kaplan - Ladenburg Thalmann & Co. Inc., Research Division: Very good. And then just with respect to the launch cost, Bob you indicated $0.02 per share. Could you kind of fine tune that a little bit for us in terms of how that's going to be kind of broken down in terms of advertising? And I guess, internal cost a little bit, in terms of the sales, sales team and the cost for that?

Yes. I think that it's actually a pretty tough question to answer. But I would say that it's probably evenly split between the sales force and the additional marketing cost. Leroux and his team has been spending a lot of time on positioning the product. We spend a lot of time and energy and money at ACR and really having a great response there as the initial kind of overview -- the overview of the product and how it fits into their treatment regimen and it was very well-received. And so I think that between the sales and marketing on a go-forward basis, it's probably going to be equal, at least initially in the first year of launch. As you know, you do tend to spend more in marketing in the first year and then hopefully, you have a successful product and it starts to tail off a little bit. And with the sales force, I think that we have the standard industry average as to what the sales force cost you per rep. We'll give a little bit more guidance on that in the beginning of next year, so you guys understand where we're going to be for 2014. But for this quarter that we're currently in -- it's probably equally split between sales and marketing. Matthew L. Kaplan - Ladenburg Thalmann & Co. Inc., Research Division: Right. Great, thanks. And then one question, and I guess for Paul, you mentioned your 505(b)(2) engine. And can you describe that engine a little bit more in terms of the number of perhaps NDAs, INDs, that or some of the metrics along those lines that you expect on an annual basis?

Yes, Matt. That's a good question. So our goal here is to basically turn that engine as many times as possible, as quickly as possible. So as in the -- we actually got the IND file for OTREXUP and we've got the approval under our belt within 3 years. We anticipate being able to do that again with testosterone, which will be entering the clinic next year in the sort of pivotal studies. And we're planning a filing on that in 2015. The next program behind that, the QS M, we will be filing an IND for that in probably around the middle of next year. So that's basically going to be a 2017, 2018 event. And we've identified a number of other compounds behind that where you can really make a difference to the performance of the drug and add a therapeutic benefit, I think that's really key here. What we do is look at making sure that we develop a therapeutic benefit above and beyond just traditional compliance, for example. And that's where the marketing discipline comes in here. But I'm anticipating that we could be looking at, going forward, 1 product a year on average for 5 to 10 years.

There are no further questions at this time. I will now turn the conference over to management for the closing comments. Please go ahead.

Thanks, Julie, and thanks again for listening to today's conference call. If you have any follow-up questions, please call me at (609) 359-3016. That completes today's call.

Ladies and gentlemen, this concludes the conference call for today. Thank you for participating. Please disconnect your lines.