Hello and welcome to the Assertio Holdings Second Quarter 2021 Financial Results Conference Call. My name is Sinara and I will be your operator for today's call. At this time, all participants are in a listen-only mode. I will now turn the call over to Max Nemmers. Max, you may begin.

Good afternoon and thank you all for joining us today to discuss Assertio's second quarter 2021 financial results. The news release covering our earnings for this period is now available on the Investor page of our website at investor.assertiotx.com. I would encourage you to review the release and the accompanying as it's important to today's discussion. With me today are Dan Peisert, President and Chief Executive Officer, and Paul Schwichtenberg, Senior Vice President and Chief Financial Officer. Dan will open the remarks and provide an overview of the business, followed by Paul, who will review our financial results. After that, we will open the call for your questions. During this call, management will make projections and other forward-looking statements regarding our future performance. Such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, including those noted in this afternoon's press release as well as Assertio's filings with the SEC. These and other risks are more fully described in the Risk Factors section and other sections of our annual report on Form 10-K. Our actual results may differ materially from these projected in the forward-looking statements. And Assertio specifically disclaims any intent or obligation to update these forward-looking statements except as required by law. With that, I will now turn the call over to Dan. Dan?

Thanks, Max. And welcome to everyone joining us this afternoon. To begin, I'd like to welcome Jeff Christensen, our Senior Vice President of Commercial, who joined us in May, and in the short time has already made substantial contributions to the business. I look forward to working with Jeff to further build out a non-personal promotional platform. In addition, I'd like to welcome back Bill Iskos. Bill rejoined the Assertio team as Senior Vice President of Operations this week. We've had the pleasure of working with Bill in the past and have not met someone who better demonstrates our culture of teamwork, inclusion and results. To get to the punch line, our business is performing better than expected and we're making substantial progress towards our corporate priorities. As Paul will go into details in a minute, our net product sales this quarter were $24.8 million. The resilience of our portfolio is extremely encouraging to generate this result. We had made the conscious effort to shift the distribution model for INDOCIN, which did impact sales this quarter but has bolstered our confidence in our promotional model and is reflected in our increased revenue guidance for the full year. Our team is fully committed to delivering on our promised restructuring savings. Through a combination of solid execution and creative thinking, we've been able to accelerate some of our cost savings. All of this has led to a strong operating result for the business this quarter. A key focus of our management team's efforts this quarter has been to mitigate our legacy legal uncertainties. You'll see in our release and filings that we've taken a charge of $1.3 million in our second quarter results. This charge reflects an estimate to resolve two separate legal matters. Unfortunately, there's not much more we can say about the nature of the charge. We would have liked to have been in a position to provide more details here today, but these matters have not come to a complete close at this point, and this charge reflects our best estimate at the current time. However, to avoid any potential confusion regarding some of the news in the press recently, these matters are unrelated to the settlements recently announced in the nationwide opioid litigation. I do believe it is a strong testament to the strength of the business that through a combination of prudent expense management and commercial execution, we're able to still hold firm on the majority of our guidance range for adjusted EBITDA despite taking the $11.3 million charge this quarter that had not been anticipated in any of our prior projections. So now that we have built our team, accelerated the pace of our synergies, begun generating operating cash flow, reduced the constraints placed on the business from the debt, and made substantial progress in defining the legal uncertainties, we are directing our focus towards the business model. That's not only building our platform. It also includes business development. We've been far more aggressive in the past few months in generating M&A targets. As you've likely seen from some of our peers recently, there are transactions available. I'm a big believer in actions speak louder than words, so I won't say much more. We just look forward to delivering on what we've said and hopefully sooner than later. And now, I'll turn the call over to Paul, who will walk through the quarterly results.

Thank you, Dan. This afternoon, I will review the financial highlights from our second quarter 2021. As was the case in the last few quarters, any references to pro forma results represent product sales as if the Zyla merger has been completed on January 1, 2020. Net product sales were $24.8 million for the three months ended June 30, 2021, compared to pro forma net product sales of $28.2 million from the prior-year quarter and $26.4 million last quarter. The decline in sales versus the prior-year quarter on a pro forma basis is driven by lower volume on discontinued and non-promoted brands, as well as SPRIX. SPRIX volume continues to be impacted by the prior-year commercial coverage change. However, the current quarter net sales reflect lower patient and systems cost, which is driving the increase versus the prior quarter. INDOCIN net sales in the second quarter reflected channel inventory adjustment related to a change in distribution strategy that will drive increased profitability in the future. The impact of this change was $1.5 million. Combined CAMBIA and ZIPSOR net sales were flat to the prior quarter. Overall, portfolio net sales were down 6% versus the first quarter, primarily due to the $1.5 million impact of the distribution model change on INDOCIN. Absent this change, portfolio net sales would have been flat to the first quarter results. Please refer to our 10-Q for specific product level net sales information. Adjusted EBITDA for the second quarter was a loss of $505,000 compared to income of $15.7 million in the first quarter. Excluding the impact of the 2021 one-time legal matters, adjusted EBITDA was $10.8 million in the second quarter versus $10.7 million in the first quarter of 2021. Our adjusted operating expenses, which reflect selling, general and administrative expenses, in the second quarter were $22.8 million versus $7.3 million in the first quarter. This amount includes a legal reserve of $11.3 million. As was mentioned on prior earnings calls, a primary focus for the company is to proactively work to mitigate legal uncertainties, and this adjustment aligns with that priority. Excluding the 2021 one-time legal matters, adjusted operating expenses for the quarter were $11.5 million, which is down $800,000, or 6%, versus the first quarter adjusted operating expenses of $12.3 million. In 2021, we expected to achieve $40 million of cost savings, and ultimately, $45 million in annual savings beginning in 2022. Through the first half of 2021, we are ahead of our expected cost savings. And this has allowed us to maintain the low end of our EBITDA guidance, despite the legal reserve recorded in the second quarter. Net loss for the second quarter was $14.2 million compared to the first quarter net income of $4.5 million. As stated previously, the current quarter is impacted by the legal reserve of $11.3 million and a charge of $2.2 million for the change in fair value of contingent consideration. On March 31, 2021, our senior secured debt balance was $75.5 million, which will not mature until Q1 of 2024. On May 3, the company paid scheduled interest and principal $10 million. Ending cash on June 30, 2021 was $54.4 million. The change in cash of $6.6 million from the March 31, 2021 balance of $61 million is primarily attributable to the principal and interest payment of $10 million, partially offset by $3.4 million of positive cash flow generated by the business. As we stated last quarter, with the additional cash on the balance sheet, we are looking to accelerate potential investments in 2021. Lastly, our updated annual guidance for 2021 is as follows. Product net sales of $91 million to $96 million, reflecting a favorable response to our refined commercial platform and the actual results for the first half of 2021. Adjusted EBITDA of $34 million to $37 million, reflecting higher revenue and cost savings versus previous expectations and the legal reserve taken in the second quarter. Overall, we're once again pleased with the quarter results. We continue to see the positive impact of our product portfolio revenue and lower expenses on EBITDA and cash flow. Looking ahead, we will continue to focus on our organizational priorities that will help position Assertio for long-term sustainable growth. And now, I'll turn the call back over to Max.

Thank you, Paul. Operator, can we open up the lines for questions, please?

Q - A -

As I mentioned last quarter, the results were made possible by the excellent efforts of our team. Once again, I express my gratitude. Thank you for joining us this afternoon and have a good evening.

Thank you. And thank you, ladies and gentlemen. This concludes today's conference. Thank you for participating. You may now disconnect.