Earnings Call Transcript - COLL Q3 2024

Operator, Operator

Greetings, and welcome to the Collegium Pharmaceutical Third 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. Please note that this conference call is being recorded. I will now turn the call over to Danielle Jesse, Director of Investor Relations at Collegium. Please go ahead.

Danielle Jesse, Director of Investor Relations

Welcome to Collegium Pharmaceuticals third quarter 2024 earnings conference call. I am 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, though we may not prevail in current or future litigation pertaining to our business. Risks related to our ability to realize the anticipated benefits and synergies of the recently completed acquisition of Ironshore. The risk that the businesses will not be integrated successfully 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.

Michael Heffernan, Interim President and CEO

Thank you, Danielle. Good afternoon, and thank you, everyone, for joining the call. Today, we will discuss Collegium's record financial performance during the third quarter and provide an update on our business, including the very exciting news that we have successfully completed our CEO search. At Collegium, we're focused on building a leading diversified specialty pharmaceutical company committed to improving the lives of people living with serious medical conditions. This quarter, we completed the acquisition of Ironshore Therapeutics and its commercial product Jornay PM. We're excited to welcome the employees of Ironshore to our team as we embark on our journey of improving the lives of patients in the ADHD community. We strive to do good while doing well and I'd like to recognize the Collegium team for their commitment to our mission and continued dedication to making a positive impact on the communities we serve by driving equitable access to STEM education and advancing the next generation of life science leaders. Our third quarter and year-to-date results reflect Collegium's strong operational execution. We are on track to deliver on our 2024 financial commitments as updated following the closing of our acquisition of Ironshore. We've made significant progress in successfully integrating Ironshore, and we continue to generate robust operating cash flows to drive significant top and bottom line growth, including growing total revenue by 17%. Additionally, we experienced 11% growth in our pain portfolio revenue and adjusted EBITDA growth of 18% on a year-over-year basis in the third quarter. The financial strength of our pain business enabled our acquisition of Ironshore and its commercial product Jornay PM. Jornay PM is a highly differentiated commercial asset that diversifies our product portfolio beyond pain and has significant revenue and growth potential with exclusivity extending 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 to become the leading growth driver for Collegium. Since closing the Ironshore acquisition in early September and for the balance of the year, we are focused on integrating the Ironshore business while maximizing the pain portfolio and developing the path to maximize growth of Jornay. We will also continue our business development efforts to identify assets that allow us to build our expertise in a new therapeutic area beyond pain. As we look to close out a strong year, we are confident that we will deliver on our financial commitments and strategic objectives, enabling strong top and bottom line growth in 2025 and beyond. After an extensive search process, we are very excited to welcome Vikram Karnani as our new Chief Executive Officer and member of our Board, effective on November 12. The Board of Collegium is convinced he is the right leader with the right skills, expertise, and experience to lead Collegium into its next phase of growth. Vikram is a proven leader with more than 15 years of experience in the biopharmaceutical industry, including holding various leadership positions across commercial, medical affairs, and business development. Most recently, after the acquisition of Horizon by Amgen, he led Amgen's Rare Disease business as Executive Vice President and President of Global Commercial Operations and Medical Affairs. Before that, he held numerous leadership positions at Horizon Therapeutics, contributing to its rapid growth phase across many aspects of the business, including leading growth strategy and establishing and expanding Horizon's presence in international markets. He demonstrated success in building organizations and maximizing their potential through both organic growth and business development, making him the right fit to lead Collegium. With Vikram as our CEO, we are well-positioned for continued success in 2025 and beyond. In the third quarter of 2024, we announced and closed the Ironshore acquisition, which is expected to deliver on all our strategic objectives related to business development. Furthermore, we drove strong revenue growth in our pain portfolio. Recent key accomplishments and highlights include: since the acquisition closed in September, we've seen accelerated growth in Jornay PM prescriptions during the back-to-school season. Through the first three quarters of 2024, Jornay prescriptions are up 31.2% year-over-year. We delivered another strong quarter for Belbuca, marked by record revenue of $53.2 million, up 17% year-over-year, and strong prescription growth of 3.5% year-over-year and 2.6% quarter-over-quarter. We generated record Xtampza ER revenue of $49.5 million, up 24% year-over-year. We achieved new payer wins for Belbuca and Xtampza ER, which are expected to support revenue growth in 2025. We continued our history of leadership at PAINWeek through the presentation of eight posters highlighting the clinical and population health impact of our differentiated pain portfolio, and we established our presence at key ADHD congresses, including a presentation on Jornay PM at the American Academy of Child and Adolescent Psychiatry 2024 Annual Meeting and at the Canadian ADHD Resource Alliance 2024 Conference. I will now turn it over to Scott to give a commercial update.

Scott Dreyer, Chief Commercial Officer

Thanks, Mike. We're pleased to have completed our recent acquisition of Ironshore and are focused on integrating Jornay PM into our portfolio of commercial assets. Jornay PM expands our commercial presence into the large and growing ADHD market and is poised to become our lead growth driver. Jornay PM is highly differentiated as the only stimulant ADHD medication with convenient evening dosing. Jornay PM provides symptom control upon awakening in the morning and throughout the day, limiting the need for short-acting stimulant add-ons. It features flexible dose-dependent duration, enabling treatment to be tailored to the patient's needs. This is important for pediatric, adolescent, and adult patients because it eliminates the need to dose at school or at work. The ADHD market has grown 5% on average over the past four years. Since 2022, Jornay PM has delivered significant double-digit prescription growth. In 2023, total prescriptions for Jornay PM grew 58% compared to 2022 to approximately 490,000. Through the first three quarters of 2024, Jornay PM prescriptions grew 31.2% year-over-year. In addition, Jornay PM has a broad and growing prescriber base with 22,600 prescribers in the third quarter, up 25% since the third quarter of 2023. Jornay PM delivered strong prescription growth in the third quarter, up over 30% year-over-year. We see acceleration during the back-to-school season. Our commercial team successfully navigated through the acquisition transition and took the necessary actions to maximize the opportunity during this critical time in the ADHD market when demand typically increases and therapy switching occurs, as patients currently being treated for ADHD often need a new option to control their symptoms. Leveraging the opportunity during the back-to-school season, average weekly prescriptions in October were 13,500, compared to 11,400 in July, marking an increase of 18%. This is an encouraging growth trajectory, and we're focused on maintaining this momentum as we work to maximize the potential of Jornay PM. Prescription performance aligns with our expectations, and the brand is on track to generate net revenue in excess of $100 million in 2024. With strong brand fundamentals and clinical differentiation, we see substantial opportunity for Jornay PM. We continue to believe it is poised to become Collegium's lead growth driver, complementing our leadership position in responsible pain management. We are committed to investing in Jornay PM to maximize its potential. Areas of focus include ensuring that the ADHD sales force is adequately sized to effectively reach our targeted healthcare professionals and raising awareness of Jornay PM's unique differentiated profile among caregivers and patients to motivate them to ask their healthcare provider about Jornay PM. At Collegium, we take pride in being the 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 extended-release market, demonstrating the ongoing strength and reach of our portfolio. The financial strength of Collegium has been fueled by the success of our pain portfolio, and our commercial organization will continue to drive momentum and prioritize maximizing our pain products. Belbuca delivered another strong quarter with total prescriptions up 3.5% year-over-year, marking the fifth straight quarter of year-over-year prescription growth and driving record quarterly revenue. We've seen an acceleration in weekly prescriptions over the last few months, which encourages us and reflects the impact of our strong commercial execution on the brand along with Belbuca's differentiated product profile. Xtampza ER prescriptions remained stable in the third quarter, in line with our expectations, while Xtampza ER's share of the OxyContin extended-release market achieved an all-time high of 38.1%. Average weekly prescriptions for Xtampza ER in September and October increased by 1% compared to the average weekly figures from July and August, indicating some momentum as we enter the fourth quarter. We anticipate revenue growth for the full year to be driven by improved gross-to-net metrics, fueling record net revenue in the third quarter. We're committed to educating physicians on Xtampza ER's differentiated label and capitalizing on its strong access position in commercial and Part D markets. Our aspiration is to replace OxyContin utilization for appropriate patients due to Xtampza's superior abuse-deterrent properties and labeling. The Nucynta franchise is a key contributor to our portfolio. Positive developments for the franchise include the authorized generic agreement with Hikma and the six-month pediatric exclusivity extension. We believe that these factors, along with the execution of our market access strategy, enable us to manage the Nucynta franchise contribution in 2025 and beyond. We're committed to growth in the pain franchise revenue in 2025 and beyond through a combination of increasing demand for our highly differentiated products and enhancing each brand's profitability. In support of that goal, our contracting strategy is clear: achieve broad coverage for our products while delivering on our commitment to enhance brand profitability by managing gross-to-net metrics. We're pleased to share that Belbuca and Xtampza ER were both added to the formulary for a large integrated health system that represents approximately 8 million commercial lives and 2 million Part D lives. We expect revenue growth from this expansion of coverage. However, because this system purchases directly and does not report prescriptions, we won't see the corresponding prescription volume in IQVIA data. Additionally, consistent with our focus on enhanced profitability, one Medicare Part D plan representing 8 million covered lives will be removing Xtampza ER and Belbuca from its formulary effective January 1. Xtampza ER will be parity with OxyContin within this plan as both products are off the formulary. As a result of this change, we will pay zero rebates for Belbuca and Xtampza within this plan. This will pressure prescriptions for both Xtampza and Belbuca in 2025 but is expected to be net revenue positive for both brands as the prescription decline offsets the profitability improvement. In closing, I want to thank the commercial team at Collegium for their strong execution and performance they've delivered in our pain and ADHD businesses. As we finish the year, we're focused on driving momentum in our pain portfolio and maximizing the potential of Jornay PM. We believe we're well positioned for meaningful growth in 2025 and beyond. I'll now hand the call over to Colleen for a discussion of the financials.

Colleen Tupper, Chief Financial Officer

Thanks, Scott. Good afternoon, everyone. Our third quarter performance reflects strong revenue growth, impactful business development, significant bottom-line expansion, and robust operating cash flows. Financial highlights for the third quarter include total net product revenues of a record $159.3 million in the third quarter, up 17% year-over-year. In line with our expectations for the third quarter, Jornay revenues were $8 million, which reflects less than one month of commercial sales and the effect of legacy ordering patterns during the ownership transition. The pain portfolio delivered strong performance with record revenue of $151.3 million, up 11% year-over-year. Belbuca net revenue was a record $53.2 million, up 17% year-over-year. Xtampza ER net revenue was a record $49.5 million, up 24% year-over-year, and Xtampza ER gross-to-net was 50.8% in the third quarter. The third quarter did benefit from a one-time favorable managed care rebate adjustment resulting from a formulary review. With this benefit factored in, we now expect full-year Xtampza ER gross-to-net to be approximately 55% in 2024, which is at the low end of the range we previously communicated. Nucynta franchise net revenue was $45.1 million, down 5% year-over-year. GAAP operating expenses were $62 million, up 76% year-over-year. This quarter included $19.9 million in acquisition-related expenses associated with the Ironshore acquisition. Adjusted operating expenses, which excludes stock-based compensation and acquisition-related expenses, were $34.8 million, up 23% year-over-year. GAAP net income for the third quarter was $9.3 million, down 55% year-over-year. Non-GAAP adjusted EBITDA was a record $105.1 million, up 18% year-over-year. GAAP earnings per share was $0.29 basic and $0.27 diluted in the third quarter, compared to GAAP earnings per share of $0.61 basic and $0.53 diluted in the prior year period. Non-GAAP adjusted earnings per share was $1.61 in the third quarter, up 20% year-over-year. Please see our press release issued earlier today for a reconciliation of GAAP to non-GAAP results. As of September 30, 2024, we had $120 million in cash, cash equivalents, and marketable securities. We generated another quarter of strong operating cash flows, enabling us to execute our capital deployment strategy and complete the acquisition of Ironshore, which utilized approximately $200 million of cash on hand. We are reaffirming our 2024 financial guidance, which we updated following the close of the Ironshore acquisition. We expect net product revenues in the range of $620 million to $635 million. Belbuca revenue growth is primarily fueled by full-year prescription growth, while revenue growth for Xtampza ER is driven by gross-to-net improvement. The full-year pro forma Jornay PM net revenue is expected to exceed $100 million. For the Nucynta franchise on a full-year basis, we expect some pressure on the Nucynta franchise year-over-year revenues in 2024 due to the elimination of the Medicaid cap by the American Recovery Act, with a return to relative year-over-year stability in 2025. We expect adjusted operating expenses in the range of $150 million to $155 million and adjusted EBITDA in the range of $395 million to $405 million. With our strong financial performance thus far, we are well-positioned to deliver on our financial commitments for 2024. We remain focused on our capital deployment strategy to create long-term value for our shareholders by executing on business development through the integration of Jornay PM, paying down debt, and opportunistically repurchasing shares. We have a proven track record of successful business development, including the acquisition of the Nucynta franchise and Belbuca, and we will leverage this expertise to efficiently integrate and maximize the potential of Jornay PM. We are already seeing immediate accretion with the addition of Jornay PM and expect the product to be accretive to adjusted EBITDA in 2025. We're committed to investing in the continued growth of Jornay PM as we look to build a new therapeutic area of focus beyond pain. We are also focused on managing our debt. With the Ironshore acquisition, we secured a new term loan of $646 million from Pharmakon, of which $320.8 million was used to replace our prior loan with Pharmakon, reducing our interest rate on this balance by 300 basis points. In addition to the significant improvement in our cost of capital, the new loan also has longer-term lower amortization and more prepayment flexibility. We estimate that our net leverage at year-end will be less than two times net EBITDA based on estimated fiscal year 2024 combined EBITDA. Additionally, we have $115 million remaining in the $150 million share repurchase program approved by our Board earlier this year. We are confident in the strength of our business and the value it will continue to generate and will opportunistically leverage share repurchases to return value to shareholders. Looking forward to 2025 and beyond, we will continue to leverage the momentum and financial strength of our core pain business to deliver on our financial commitments of growing revenue, increasing profitability, and generating robust cash flows. The outlook for our pain business is bolstered by recent positive developments for our pain portfolio, including the Nucynta franchise, the authorized generic agreement with Hikma, and the pediatric exclusivity extension. Our successful payer strategy and tailwinds from the Medicare Part D redesign are expected to drive organic growth in 2025. At the same time, we are focused on integrating and maximizing the value of Jornay PM and investing in its future growth. Jornay PM is poised to be our lead growth driver as we build on the positive momentum we are already seeing just a month into owning the product. We remain dedicated to the disciplined execution of our capital deployment strategy as we look to expand our portfolio of commercial products, pay down debt, and return value to shareholders through opportunistic share repurchases. I will now turn the call back to Mike.

Michael Heffernan, Interim President and CEO

Thanks, Colleen. We are proud of our accomplishments in the third quarter, which positioned us for continued success in 2025. For the remainder of the year, we are focused on integrating and maximizing Jornay PM, in addition to delivering on the financial and strategic commitments of the core pain business. We are confident in our ability to deliver record financial results, generate robust cash flows, and deploy capital in a disciplined manner. I'd like to personally thank the Collegium leadership team for their exceptional stewardship through the transformational Ironshore acquisition, and we're very excited to welcome Vikram as our new CEO this month to join our strong team. With his extensive commercial and business development experience, I am confident he is the right person to lead Collegium through this next phase of growth. I will now open the call up for questions.

Operator, Operator

Thank you. Our first question comes from Les Sulewski with Truist Securities. Please proceed.

Les Sulewski, Analyst

Good evening. Thank you for taking my questions. I have a few, maybe first for Mike or Colleen. Congrats on the impressive CEO selection. And although it might be premature, but given Vikram's strong rare disease background, would you expect any divergence in BD plans into new therapeutic areas? Or do you essentially expect to continue to anchor around the new neuro category? And then maybe for Scott, what are the plans for Belbuca and your investment efforts leading into LOE? And then what is the value proposition of Belbuca against some of the other chronic pain products, specifically those undergoing clinical trials such as ...? And then maybe last, can you talk about the back-to-school season with Jornay, how much of that script growth was tied to the ownership change? And what do you envision as the peak sales potential or peak market share potential from Jornay across the ADHD market? And in general, can you highlight how impactful the back-to-school season seasonality is to this product? Sorry for the mouthful, but thank you.

Michael Heffernan, Interim President and CEO

Thank you, Les, for the question. This is Mike. I'll start at the beginning, and then I'll ask Scott to jump in on some of the other questions. Regarding our strategy, since we closed the Ironshore acquisition in early September, as I mentioned, for the balance of the year, we're really focused on integrating Jornay and growing Jornay, as well as maximizing our pain portfolio. That is a key part of our strategy. We will also continue our business development efforts to identify assets that allow us to build our expertise in a new therapeutic area beyond pain. As Vikram gets further acquainted with the business, he’ll work with both our leadership team and the Board to further build out Collegium's strategy and execution and fine-tune the business development strategy. I'll pass it to Scott for the question about Belbuca LOE.

Scott Dreyer, Chief Commercial Officer

Got it. All right, Les. Regarding Belbuca LOE, the biggest thing I'd say is we are investing through the tape. We don't view Belbuca as an asset where we're in harvest mode. The fact is when you look at the current LOE assumptions, we think there may be some upside there. So we're investing fully in the product. To your question about competition and the Vertex product, I'd just say any new product in pain, we're a fan of, as the leader of responsible pain management. We believe in more options coming to the market that are helpful for patients. That said, that product has no competition in the chronic pain space where all of our products play, not just Belbuca. So don't view it in any way as a competition, and we think Belbuca has a long runway of growth as the use of buprenorphine in pain continues to increase; the buprenorphine market is expanding, and Belbuca is highly differentiated within the market. On back-to-school, regarding Jornay, we are really happy with what's happened during the back-to-school season. We closed the deal kind of in the middle of the season, which kicks in around the August timeframe. The team has done a tremendous job focusing on execution. We’ve seen if you look at the average weekly, we’ve seen 18% growth comparing October versus July. We expect that momentum to continue as the season typically has an impact that carries into November, positioning us for a strong trajectory as we head into 2025. You asked about peak sales, and we don’t provide peak sales guidance, so we won't give any more color on that. I'll just reinforce that the growth trajectory of Jornay is very strong, and we expect that to continue moving into next year.

Les Sulewski, Analyst

Excellent. Thank you for that color.

Operator, Operator

And the next question comes from the line of David Amsellem with Piper Sandler. Please proceed.

David Amsellem, Analyst

Thanks. On Jornay PM, can you remind us how you're thinking about the gross-to-net spread going forward, whether you can give us a range or just a sense of what the gross-to-net looks like in relation to other branded agents for ADHD? That would be helpful. That's number one. And then number two, just coming back to business development and M&A. With Jornay, you've got an interesting and somewhat diverse call audience. I believe there are pediatricians, general practitioners, and psychiatrists who are prescribing the product. Given that call audience and the commercial infrastructure you have, how does that inform your thinking about future business development and M&A? Thanks.

Michael Heffernan, Interim President and CEO

Great. Thanks, David. Scott, do you want to take the first question on Jornay PM gross-to-net?

Scott Dreyer, Chief Commercial Officer

Yes, yes. Sure. So Colleen and I will tag team on this one. First, I'll just start with coverage and reinforce that our coverage for the brand is very strong right now, with 60% of the business in commercial and 40% in Medicaid. Jornay has coverage across 80% of that overall. So we’re happy with the coverage. We will always seek to expand it, but as we've done on the pain side, we will be disciplined in terms of the choices we make to expand that coverage. Colleen, do you want to give a little more color on gross-to-net?

Colleen Tupper, Chief Financial Officer

Yes. I'd say, David, we look forward to early January to give you a bit more color on guidance. However, as of now, gross-to-net on Jornay is typical of what you would see in branded ADHD products. It's sitting in the 60s range, with rebates making up a significant portion of that, along with the co-pay program, which is also typical in this space.

Scott Dreyer, Chief Commercial Officer

And regarding business development, as you know, our focus has really been on moving beyond pain. As you suggested, Jornay PM and our call points give us a lot of flexibility to take various directions. We will leverage our new commercial expertise and overlap. Because of the call points, we have a lot of optionality. We'll primarily spend our time integrating Jornay and focus on how to grow it. As Vikram comes in and we analyze the opportunities in front of us, we will, as we move into next year, advance our development strategy to leverage new expertise beyond pain.

David Amsellem, Analyst

Yes, that's helpful. Thank you.

Operator, Operator

And the next question comes from the line of Serge Belanger with Needham & Company. Please proceed.

Serge Belanger, Analyst

Hi, good afternoon. A couple of questions for us. I guess the first one regarding the integration of Jornay PM. Scott, I think you talked about sales force sizing for that product. Just curious what the current size of the sales force is and how you're thinking about the modifications to it? And then secondly, regarding the changes to formulary coverage on both Xtampza and Belbuca. I think there were two pieces. First, for where you're losing exclusivity. Just curious how many prescriptions are at risk. And on the new plan, is there an existing Oxy business that provides you a conversion opportunity for that new formulary? Yes, that's it. Thanks.

Michael Heffernan, Interim President and CEO

Great. Thanks, Serge. Scott, it sounds like these are both for you regarding the integration.

Scott Dreyer, Chief Commercial Officer

Sounds good. Yes. So Serge, first, when it comes to the sales force and our current situation. Currently, we have about 150 salespeople, including reps and management. We're assessing our next steps and believe that we need to expand a bit to achieve the coverage we want. Our focal point is maximizing the potential and raising awareness, which requires enough coverage to get the recent frequency needed to continue accelerating the growth of the brand. When we refine our OpEx guidance in January, we will include any final decisions on the sales force. Regarding your second question about the formulary changes, we can take them one by one. As for the addition, that's about 8 million lives in commercial and 2 million lives in Part D at the integrated health system I mentioned. Right now, there is a little bit of OxyContin business in there, but not much. It differs from the conversion opportunities we've had in the past, starting with fresh coverage from OxyContin. For Belbuca, there is some use, but significant opportunity within the plan. In terms of scripts, in the Part D plan I mentioned with 8 million lives, we've been removed from formulary, impacting about 12% of Belbuca prescriptions and about 18% of Xtampza prescriptions within that plan. It's important to note that we decided we were not willing to pay the price it would take to maintain access, and the rebate will go to zero. We’re confident it will be net revenue positive overall, even if we see pressure on prescriptions in those plans.

Serge Belanger, Analyst

So when you combine the two changes with the new addition and the change to the existing formulary, do you think it will balance out in terms of decision volume for both Xtampza and Belbuca?

Scott Dreyer, Chief Commercial Officer

Yes. It will balance out in terms of lives, not prescriptions. As I mentioned, the integrated health system does not have prescriptions reported through IQVIA, so we'll have revenue from it, but you will not see prescriptions. In contrast, where the removals occur, those reflect directly through IQVIA impacts. All those inflows and outflows will factor into our guidance in January as always. However, what's crucial is that revenue will be different in terms of scripts in those two different situations, if that makes sense.

Serge Belanger, Analyst

Yes. Thanks for the call.

Operator, Operator

And the next question comes from the line of Oren Livnat with H.C. Wainright. Please proceed.

Oren Livnat, Analyst

Thanks, I have a couple. Just to follow up on the questions regarding Vikram's appointment as CEO. Can you discuss what made him a good fit given his experience in global rare disease versus your portfolio of mass market ADHD and pain products? Should I assume that your existing core management competencies will be elevated with him, and he will be more focused on broadening your horizons into other areas? Or is he excited and prepared to take on a different sort of book of business? And I have a follow-up.

Michael Heffernan, Interim President and CEO

Thank you, Oren. Yes, let me talk a little bit about Vikram's experience. As I mentioned, he's been in biopharma for over 15 years. He was involved in every aspect of Horizon's business as that company grew from $300 million in revenue to $4 billion, culminating in a $28 billion acquisition by Amgen. He successfully led the company's transformation through its commercial growth and the establishment of its international division. Those skills are transferable when it comes to fostering growth at Collegium. I believe Vikram is excited about the base business we've created at Collegium; it provides him a fantastic substrate to build upon with a strong business and a terrific management team. So for a new CEO coming into the situation, he has a growth business to capitalize on while utilizing his expertise alongside the existing strengths of our management team.

Oren Livnat, Analyst

Got it. Regarding Jornay PM, you highlighted pretty strong execution through back-to-school. I can imagine there wasn't some friction or disruption with the corporate change yet. It looks like you're delivering about 25% year-over-year growth right now. Is it fair to say that you’re not necessarily firing on all cylinders during this transition, and growth could inflect upwards again on a year-over-year basis as you settle the organization, resize, and apply some increased resource allocation?

Michael Heffernan, Interim President and CEO

Yes. Thanks, Oren. Scott, do you want to take that?

Scott Dreyer, Chief Commercial Officer

Yes. That's a great question. So first, I'd say we didn't see disruption, and that was purposeful, as we retained the entire sales force management team and everyone to ensure continuity. So yes, we are indeed firing on all cylinders, with year-over-year growth currently at 31.2%, which accelerated during the back-to-school season, surpassing last year’s growth rate. The team deserves tremendous credit for maintaining continuity during this time. As for future opportunities, there are several factors to consider. First is execution, where we will apply our expertise to ensure that we're consistently effective in front of customers. Second, we will ensure the sales force is adequately sized and that we invest in marketing to drive awareness and usage among healthcare professionals first and foremost. Lastly, given Jornay's unique profile, we recognize that caregivers and patients are largely unaware of this dosing option, which presents an opportunity. We will act on those insights as we work through 2025 to sustain the brand's growth momentum.

Oren Livnat, Analyst

And just lastly, one housekeeping item. I haven't run the math yet with gross-to-net and the low Xtampza ER numbers, so maybe they align perfectly, but were there any material inventory moves on Xtampza or any other products up or down in the quarter?

Colleen Tupper, Chief Financial Officer

Sorry. Yes, I jumped in too quickly. Oren, across the pain portfolio, it’s fairly consistent around 15, plus or minus half. For Jornay, because we had ownership for less than a month, coupled with their ordering pattern with one of the big three wholesalers every other week, we have lower days on hand than typical. Jornay ended September just shy of 11 days on hand, whereas normally you would expect that to be about 15; that's the only difference I would highlight.

Oren Livnat, Analyst

All right. Thanks so much.

Colleen Tupper, Chief Financial Officer

Thank you.

Operator, Operator

Thank you. Ladies and gentlemen, this concludes the question-and-answer session. I'll turn the call back to Mike Heffernan for his closing remarks.

Michael Heffernan, Interim President and CEO

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

Operator, Operator

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