ANI Pharmaceuticals, Inc. (ANIP) Earnings Call Transcript & Summary

Welcome to the 2020 Annual Meeting for ANI Pharmaceuticals, Inc. Our host for today's call is Robert Brown. [Operator Instructions]. I will now like to turn the call over to your host. Mr. Brown, you may begin.

Thank you. Good morning, everyone, and welcome to ANI's 2020 Virtual Annual Meeting of Stockholders. I am Robert E. Brown, Jr., Chairman of ANI's Board of Directors. Joining me today are Patrick D. Walsh, Interim CEO and Director; Thomas Haughey, Director; David B. Nash, MD, MBA, Director; Stephen P. Carey, Vice President Finance and CFO; Robert W. Schrepfer, Senior Vice President, New Business Development and Specialty Sales; Brian Lee, representing our outside counsel, Dentons US LLP; and Joseph DiFalco, representing our independent auditors, EisnerAmper LLP. As you all know, Patrick Walsh is our interim CEO, while our search -- our executive search firm is conducting the search for a President and CEO. Pat, would you like to offer a few introductory remarks?

Thank you, Bob. Over the past few weeks, it's been my pleasure to serve as the CEO of the company and report on our key business initiatives. However, I first want to thank our dedicated employees and our strong network of supply chain partners who have worked through the challenges presented by the COVID-19 pandemic. Regarding our business initiatives, I'd like to comment on the status of our Cortrophin filing, our ongoing CEO search, the impact of COVID on our business and the relentless focus of adding additional new product acquisitions to our portfolio. As you know, ANI received a refusal to file from the FDA on the Cortrophin supplemental NDA. Immediately following this action, I initiated a comprehensive review of the application, including hiring a world-class regulatory consulting firm in order to conduct a thorough analysis of the entire application and not just focusing on the items mentioned in the refusal to file. Based on internal and external review of the application, the path was clear to focus towards resubmittal of the application versus petitioning for a Type A meeting with the agency and then resubmitting for a new application. We feel this provides the most expedient and logical path towards resubmitting the application with the FDA. Upon completion of the external assessment, we intend to bolster the application to address all items in the RTF observations and the external assessment, then resubmit the application with the FDA. We will update our shareholders on our refiling plan as soon as we complete this exhaustive review. Regarding our CEO search, we retained a nationally recognized firm and previewed dozens of exceptional candidate profiles for the ANI CEO role. We are very pleased with the quality of the talent pool, have narrowed the field of candidates and expect to appoint a new CEO as soon as administratively possible. Regarding COVID, we are all adjusting to the new normal together and are closely monitoring the impact on our business. Across the industry, prescription volume is down, particularly around drugs for outpatient and certain hospital procedures, and client-buying patterns are anything but normal in 2020. In spite of this fact, our business is resilient, our manufacturing centers have seen minimal impact and our dedicated employees are working to supply critical medicine to those in need. As you know, at the end of the first quarter, ANI suspended financial guidance citing certain uncertainty stemming from the global COVID crisis. We will continue to monitor the impact of COVID on our business and update investors accordingly. We look forward to returning to a new normal and a more predictable business environment. Regarding new opportunities, I believe this climate for acquiring new product or development opportunities has never been better. For market-centered nimble leadership teams, today's climate is ripe with opportunity, and ANI will continue to pursue acquisitions and partnerships to grow our business base and expand our footprint. In closing, you can also expect the launch of an updated modern descriptive website, see ANI initiate a more comprehensive investor relations outreach, add to the diversity of its Board composition and focus on delivering a great result for shareholders in the face of the demanding business climate. We thank you for your support of our company. Bob, I'll turn it back to you to call the annual shareholder meeting to order.

Thanks, Pat. I will now conduct the official portion of the meeting. I will act as the Chairperson of the meeting, and Stephen P. Carey will act as Secretary of the meeting and also as the Inspector of Election. Mr. Carey has previously taken his oath as an Inspector of Election. A list of shareholders as of the record date is available for inspection by shareholders using the registered shareholders list link found where you access this webcast. I've been advised by Mr. Carey that a quorum is present. I'm now calling the meeting to order. If you have any questions relevant to this meeting, you may submit your question online. As a courtesy to fellow stockholders, please be as concise as possible. The agenda for the meeting should be visible on the top right-hand side of your screen and a link to the rules of conduct is available under the "Meeting Materials" section of the screen. We intend to strictly follow the rules -- the agenda and the rules of conduct in carrying out the business of this meeting. The Secretary has delivered an affidavit of mailing, establishing that notice was duly given. A copy of the notice of meeting and affidavit of mailing will be incorporated into the minutes. All holders of record of ANI's common stock and Class C special stock at the close of business on April 13, 2020, are entitled to vote at this annual meeting. The voting list of stockholders is available for inspection during this meeting. These documents will be filed with the corporate records of the company. We can now turn to the formal business of this meeting. The matters to be voted on at this meeting are listed in the company's proxy statement. The company has not received notice from any of its stockholders on any matter to be considered at today's meeting, and therefore, no proposals, other than those listed in the company's proxy statement may be properly introduced by the stockholders. I now declare the polls open for voting. The first item on the agenda is the election of directors. The nominees for directors are -- as set forth in the proxy statement are: Robert E. Brown Jr.; Thomas Haughey; David Nash, MD, MBA; and Patrick D. Walsh. Each director, if elected, will serve for a term of 1 year. The second item on the agenda is the proposal to ratify the company's selection of EisnerAmper, LLP as the company's independent registered public accounting firm for the year ending December 31, 2020. The third item on the agenda is the proposal to approve the compensation of the company's named executive officers on an advisory basis. The fourth item on the agenda is the proposal to approve the frequency of future advisory votes on executive compensation on an advisory basis. The fifth item on the agenda is the proposal to approve the Sixth Amended and Restated 2008 Equity Incentive Plan. Stockholders who have already voted by mailing their proxy card over the phone or through the Internet do not need to vote again unless they wish to change their vote. If you have not already voted or you wish to change your vote, please follow the instructions on the web portal on how to submit your vote. We will leave the voting open for a few moments before closing the polls. [Voting]

The polls are now closed. Will the Inspector of Elections please provide a report on the results of the vote?

Thank you, Bob. I've completed a preliminary count of the shares voted at the annual meeting. There were sufficient votes to: one, approve the election of all of the nominees for director; two, approve the ratification of the selection of EisnerAmper, LLP as the company's independent registered public accounting firm for the year ending December 31, 2020; three, approve the compensation of the company's named executive officers on an advisory basis; four, approve the frequency of future advisory votes on executive compensation to be on an annual basis; and five, approve the Sixth Amended and Restated 2008 Equity Incentive Plan. I, as the Inspector of Elections, will deliver a final report that will be included as part of the record of this meeting. The final voting results will be included in the company's current report to be filed with the Securities and Exchange Commission no later than June 11, 2020.

Thanks, Steve. At this time, I declare the formal portion of this annual meeting to be officially adjourned. Let me again thank you for your ongoing support of ANI. We greatly appreciate your confidence, and thanks for joining us today. We will now answer any questions relevant to that or submitted in connection with the business of ANI Pharmaceuticals, Inc. Steve, are there any questions submitted by stockholders?

Sure. Thank you, Bob. Right now, there's one question that is relevant to the meeting in queue. And it's a financial question, so I'll -- I can field this one. There's a question from a shareholder asking if the Amerigen products that we purchased back in January of this year are meeting the company's expectations. And I would say, and I think as we've previously discussed on the first quarter earnings call, the company doesn't specifically speak to performance on a product-by-product basis. But what we can say in this area is that the transition of the Amerigen portfolio to ANI ownership went very smoothly. It went as planned. All of our various functions from sales and marketing team, supply chain management team, et cetera, did a very good job in terms of the handover from Amerigen to the ANI control of these products. And in the aggregate, out of the gate here, the products have met our expectations in terms of our deal modeling for that particular business development deal. And I'll just pause here for a moment to see if any other questions come into queue. Okay. Bob and Pat, I would say that there are no further questions that were submitted by our stockholders that are relevant to the proposals or subject matter for this meeting. And I'll hand it back to you, Bob.

Thanks, Steve. We will now conclude today's event. Thank you for joining us at the ANI Pharmaceuticals, Inc. Annual Meeting of Stockholders.

This now concludes the meeting. Thank you for joining and have a pleasant day.