Amphastar Pharmaceuticals, Inc. (AMPH) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. I'm Mary Ziping Luo, Chairman, Chief Operating Officer and Chief Scientist of Amphastar Pharmaceuticals, and it is a pressure to welcome you to Amphastar Pharmaceuticals Virtual Annual Meeting of Stockholders. As provided in the company's bylaws, I will act as Chairperson of this meeting. I have asked Jacob Liawatidewi, our Corporate Secretary, to act as secretary of this meeting and record the minutes. Before proceeding further, let me introduce the other directors and [Audio Gap] Jack Yongfeng Zhang, PhD, Chief Executive Officer, President and Chief Scientific Officer; Richard Koo; Howard Lee, PhD; Floyd Peterson, NPH; Richard Prins; Michael Zasloff; MD, PhD; Diane Gerst; David Maris; [ Gail Devlin ]. I would also like to introduce the other executive officers who are in attendance virtually. William J. Peters, Chief Financial Officer, Executive Vice President of of Finance, Treasurer and President of International Medication Systems, Limited; Rong Zhou, Executive Vice President of Production Center, President of Armstrong Pharmaceuticals and Amphastar Nanjing Pharmaceuticals; Jacob Liawatidewi, Executive Vice President of Administration Center, Sales and Marketing, Corporate Secretary and President of Amphastar France Pharmaceuticals. I would also like to introduce other members of company management team who are in attendance virtually. Tony Marrs, Senior Vice President of Regulatory Affairs and Clinical Operations; Daniel Dischner, Vice President of Corporate Communications and Human Resources; Albert Cuadra, Vice President of Accounting and Controller; Kevin Barry, Acting General Counsel, Vice President of Legal Affairs; Eva Wen, Senior Director of System Control; Jim [ Batten ], Senior Director of Texas; Amro Elatrozy, Director of Financial reporting. Also, in attendance virtually today are Andrew Hofman, representing Wilson Sonsini Goodrich; and [Audio Gap] corporate counsel; Lynton Rowsell; and [ Greg Revelle ], representing Ernst & Young, independent public accounting firm [Audio Gap] representing American Election Services, LLC and who is serving as the independent -- as the inspector of election. I will now turn the meeting over to Dan Dischner, who will conduct the formal portion of this meeting. Hi, Dan.

Hi. The annual meeting is being held for the following purposes: one, to elect 4 Class II drillers to hold office for a 3-year term and until their respective successors are duly elected and qualified; two, to ratify the appointment of Ernst & Young LLP as Amphastar's independent registered public accounting firm for our fiscal year ending December 31, 2021; and three, to approve, on an advisory basis, the compensation of our named executive officers. As indicated in the proxy statement, our Board of Directors has recommended that our stockholders vote for each of the nominees for director; for, the ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm; and for, approval on any advisory basis of the compensation of the company's named executive officers. I want to remind you that attendance at this meeting is by invitation only. If there is anyone here who is not a stockholder of the company, a designated proxy of a stockholder of the company or expressively invited by the company to attend this meeting, please kindly leave the webcast. Thank you. The annual meeting is being held in accordance with Amphastar's bylaws and Delaware law. During the formal meeting, we will address the matters described in Amphastar's proxy statement dated April 14, 2021, as supplemented. After the voting, we will announce the preliminary results [Audio Gap] After we complete the formal meeting, there will be an opportunity for stockholders to ask questions. Notice of the meeting. I have proof by affidavit that the notice of this meeting has been duly given, and that notice of Internet availability of the proxy materials was mailed on or about April 23, 2021, to all stockholders of record at the close of business on April 13, 2021, the record date for this meeting. We will have a complete list of these stockholders of record on our corporate website until the end of this virtual annual meeting. The affidavit, together with copies of the notice of the Internet availability of the proxy materials, the proxy statement and the proxy will be filed with the minutes of the meeting. Inspector of election. We have appointed Christel Pauli, a representative of American election services to act as inspector of election for this annual meeting. The inspector of election has signed an oath of office, which will be filed with the minutes of this meeting. Quorum. The inspector of election has advised me that we have present virtually or by proxy a sufficient number of shares to constitute a quorum. Therefore, the meeting is duly constituted, and we may proceed with business. The voting procedures. If you have already submitted a proxy or voted in the matter outlined in the proxy statement, we have already received your vote, and there is no need to vote at this virtual meeting. Your vote will be counted. Stockholders who have not submitted proxies and stockholders who want to change their vote, please follow the instructions provided online. Each holder of common stock is entitled to 1 vote for each share of common stock held of record at the close of business on the record date. The votes cast today will be counted in the final tally along with the proxies previously received. After voting has been completed on all matters on the agenda, we will close the polls, and the inspector of election will provide their preliminary report. We will announce the preliminary results of the voting at the end of the meeting. Opening of the polls. It is now 11:14 on June 7, 2021, and the polls for each matter to be voted on at this meeting are now open. Election of Class II directors the first item of business is the election of directors. Stockholders do not have the right to accumulate their votes in the election of directors. Our Board of Directors has 10 members and is divided into 3 classes, each with a 3-year term. There are 3 directors in Class I and II and 4 directors in Class II. As indicated in our proxy statement, Mary Luo, Howard Lee, Michael Zasloff and [ Gail Devlin ] are nominated by the Board of Directors to serve as Class II directors until the annual meeting of stockholders in 2024. Dr. Luo, Doctors Zasloff and Mr. Lee are currently serving as members of our Board of Directors. Ms. [ Devlin ] was recommended by one of our nonmanagement directors and nominated by our Board of Directors. The Board of Directors recommends that stockholders vote in favor of these nominees, and the proxy solicited by the Board will be voted in favor of these nominees. Ratification of appointment of our independent registered public accounting firm. The second item of business is to ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for our fiscal year ending December 31, 2021. If the stockholders do not ratify the selection of Ernst & Young LLP as independent auditors, the Board may reconsider the appointment. The Board of Directors recommends that stockholders vote in favor of this proposal, and the proxy solicited by the Board will be voted in favor of this proposal. Lynton Rowsell is present virtually from Ernst & Young LLP and is available to answer any appropriate questions that you may have. Advisory vote on the compensation of our named executive Officers. The third item of business is the advisory vote on the compensation of our named executive officers. Although this vote is nonbinding, the Board will consider the outcome when making future compensation decisions for our executive officers. The Board of Directors recommends that stockholders vote in favor of this proposal and the proxy solicited by the Board will be voted in favor of this proposal. Online voting. If you are voting today, you must submit your votes online at this time in order for them to be counted by the inspector of election. The inspector of election will not accept votes or any changes or revocations submitted after the closing of the polls. [Voting]

Closing of the polls. It is now 11:17, and the online polls for each matter to be voted on at this meeting are now closed. No additional ballots, proxies or votes and no changes or revocations will be accepted. Results of the voting. At this time, we will provide a preliminary report on the voting results. Regarding proposal #1, the election of directors. Mary Lou, Howard Lee, Michael Zasloff and [ Gail Devlin ] have been elected to the Board of Directors to serve as Class II directors. Regarding proposal #2, the ratification of Ernst & Young LLP to serve as the independent auditor has been approved. Regarding proposal #3, the advisory vote on the compensation of the named executive officers has been approved. These are the preliminary results of voting. The final count may vary following the final examination of the proxies and ballots. The final results of voting, including any ballots and proxies recorded during this meeting, will be set forth in the report of the inspector of election and will be included in the minutes of the meeting. The final results will also be reported on a Form 8-K to be filed with the SEC within 4 days of this meeting. This annual meeting of stockholders is now adjourned. Thank you for your attendance. We will now proceed with the question-and-answer period. Report of stockholders. We will now entertain questions concerning matters that any of the stockholders submitted via the web portal. In the interest of time, it is appropriate that we limit questions to only those stockholders of record that have a right to vote in today's meeting. I would like to note that during the course of the question-and-answer period, representatives of the company may make forward-looking statements regarding future events or the future financial performance of the company, which involve risks and uncertainties. Such statements are only predictions, and actual events or results could differ materially from those predictions due to a number of risks and uncertainties, some of which are outside the company's control. I refer you to documents while we file from time to time with the Securities and Exchange Commission, specifically our most recent annual report on Form 10-K that was filed on March 15, 2021, and our most recent quarterly report on Form 10-Q that was filed on May 7, 2021. These documents contain and identify important factors that could cause actual results to differ materially from those contained in our projections or forward-looking statements. We disclaim any obligations to update or revise these forward-looking statements. There are no questions today from our stockholders.

I want to thank all of you for attending today's meeting and for the interest you have shown in the affairs of Amortization Pharmaceuticals. We very much appreciate your attendance. And as always, thank you for your support.