Collegium Pharmaceutical, Inc (COLL) September 2026 Conference Transcript

Good morning, everyone. Thank you very much for joining us at the H.C. Wainwright Global Investment Conference. My name is Brandon Foulkes, and I am one of the equity research analysts here at H.C. Wainwright. Next up, we have a presentation from Collegium Pharmaceuticals, and joining us from Collegium is CEO Vikram Konani. Vikram, thanks very much for joining us.

Thank you for having me. Good morning, everyone. Before I start with the presentation, I'd like to remind everyone that during this presentation, I will be making forward-looking statements and discussing non-GAAP metrics please refer to the risk factors and non-GAAP reconciliations discussed in our latest sec filings thank you for the opportunity to introduce you to collegium i started at collegium uh just under two years ago in late 2024 and with the with a with a goal to lead the organization in its next phase of growth following our acquisition of jone pm for adhd our first medicine diversifying from the pain market Collegium is on a mission to building a leading diversified biopharmaceutical company. We're committed to patients with complex CNS conditions as well as pain in pain management. Our current focus is chronic pain management and ADHD with six differentiated marketed products. We have significant revenue and cash generation and a very strong growth profile. We expect to do approximately $840 million in revenues this year, representing 8% growth compared to 2025. Our near-term growth is expected to be driven by our franchise of ADHD medicines, Jornay PM and Astaris. Our business continues to be highly profitable with adjusted EBITDA expected to be nearly 460 million this year. Collegium has a very proud history of serving patient needs. The company was founded in 2002 with the goal to help address the the opioid epidemic we became a leader in responsible pain management by developing extamsa er and then acquiring three additional differentiated chronic pain medicines in 2024 the iron shore acquisition was our first step as we diversified into adhd and cns conditions we subsequently continued to grow our pain and adhd businesses while also evaluating potential new commercial products to add to our portfolio. In 2026, just a couple months ago, we added a second differentiated ADHD pain medicine of ADHD medicine into our portfolio called Astaris. Today, ADHD represents our core growth driver with two medicines serving different and distinct patient needs and with patent protection out to 2032 and 2037 respectively for journey pm and for astarus as we look ahead to collegium's vision for our next phase of growth with a long history in responsible pain management we believe that our pain portfolio serves as an important foundation for our business while part of this franchise specifically our nusinta products began to see some initial generic competition this year we expect overall pain revenues to remain meaningful and durable well into the future we expect that this business will play a significant role in funding our expansion into new medicines and therapeutic areas our current growth engine which is driven by our adhd portfolio with two highly differentiated medicines continues to perform well we have broader aspirations for the future and we plan to continue to grow and diversify our portfolio with future business development and i'll get to that a little bit later 2026 is expected to represent another year of revenue growth for the company where we project approximately eight percent year-over-year growth much of this will be driven by journey pm which is expected to grow by more than 30 this year as well as an initial contribution from a partial year of sales from Mastaris. Despite this revenue growth, we do expect adjusted EBITDA to remain generally flat this year. This is primarily driven by increased investment to further grow our ADHD business, as well as some initial declines in our Nusinta revenues, which is experiencing for the first time some competition from generic products. We have a clear set of strategic priorities we believe will create long term value for our shareholders which include driving further growth and accelerating that growth for our adhd portfolio continuing to maximize the durability of our pain business and strategically deploying capital as we generate significant amount of cash from our base business our capital allocation priorities include business development as we did earlier this year in acquiring astaris debt repayment and strengthening the balance sheet and opportunistically buying back shares we we also announced a new 50 million dollar asr in august turning to our most recent quarterly results we generated 41 year-over-year growth in journey pm revenues nearly 141 million in total pain revenue and total revenues were up six percent and adjusted ebitda was up eight percent year-over-year importantly we closed on the acquisition of astarus in q2 and raised our expectations to 65 to 75 million of revenue this year. And as a reminder, that's a partial year of sales. And finally, in August, as part of our broader capital allocation strategy, we announced a new $50 million accelerated share repurchase program, reflecting our confidence in the strength of our ongoing business. Let's now take a deeper dive into our ADHD business. taking a step back and looking at the market the total market in the u.s is large growing with and growing with about 111 million annual prescriptions increasing more than eight percent a year majority of these prescriptions about 90 percent are for stimulants which include methylphenidates as well as amphetamines both jornay pm and astarus are in the methylphenidate category and have unique and differentiated profiles which drive usage. Despite the availability of multiple generic ADHD medicines, many patients are not fully satisfied with their options. In fact, on average, patients try three different ADHD medicines before they find the right treatment that works for them, often influenced by level of efficacy, onset of action, duration of effect or side effect profile we believe that there is a significant opportunity for both journey pm and astarus to grow share from genetic stimulants both this year and into the future journey pm is a highly differentiated medicine it's a specifically it is a cns stimulant prescribed by both psychiatrists as well as pediatricians it is the only stimulant adhd medicine with once daily evening dosing that provides symptom control upon awakening eliminating the need to dose in the morning and waiting for its onset of action this is particularly important for those patients whose adhd symptoms are especially challenging first thing in the morning during apm can provide smooth symptom control throughout the day which may eliminate the need for short acting stimulant add-ons later in the day as well as it is slowly absorbed in the colon providing smooth onset and offset of effect based on recent market research journey pm is now the number one highest rated branded adhd medicine in terms of product differentiation 70 percent of hcp surveyed plan to increase prescribing this was the highest among all other branded adhd medicines more than 70 percent of hcps will honor a patient or a caregiver request to try Jornay PM. And finally, Collegium was the highest-rated company in terms of reputation in ADHD. We have experienced significant growth in Jornay since it was acquired by Collegium in 2024. Scripps grew significantly in the most recent quarter, up 13% year over year. We have a broad and a growing prescriber base. more than 30,000 prescribers in Q2, which was up almost 18% year-over-year. Our branded long-acting methylphenidate market share is up 6 percentage points to 29% overall. More importantly, the back-to-school season, which is now well underway, we are already beginning to see some positive signals as Jornay PM usage continues to tick up. For new-to-brand prescriptions, which is a very good leading indicator often in this category, we are very encouraged by more recent trends, as we were at the same time last year, and we observed that Jornay is also growing share in new-to-brand RXs. Moving over to Astaris, we acquired Astaris in May of this year. We're well positioned for future growth, as it is highly also complementary to Jornay as part of our adhd portfolio it is the first and only adhd treatment with both fast and long-acting medicines in one capsule it's a it's a it's an ideal treatment option for patients in need of rapid onset of efficacy and duration throughout the day often with variable daily schedules so such patients may not always be an ideal candidate for john apm but they are an ideal candidate for stars it is viewed as highly differentiated and highly favorable among hcps and as i said earlier we have ip protection through 2037. we've also um this this brings significant cost synergies uh for for collegium it is an immediate treat of transaction with greater impact in 2027 and beyond and as i said earlier we raised expectations recently to 65 to 75 million in revenues in its first partial year of sales moving on to our 2026 priorities uh for for the adhd portfolio our priorities for john apm are pretty straightforward increase awareness and adoption with an expanded set of prescribers raise caregiver and patient awareness to drive hcp requests and increase depth of prescribing with targeted physicians moving over to astaris you know successfully integrate into our portfolio which were well underway on that priority already accelerate the growth trajectory by leveraging established commercial infrastructure that is already in place and evaluate opportunities to continue to drive operational efficiencies within this portfolio let's now switch gears for a moment and talk about our pain portfolio and the durability of that business our two core pain products include Belbuca and extamsa. Belbuca is the only long-acting opioid pain medicine that uses buprenorphine buccal film technology. It is the number one highest rated branded ER opioid in terms of product differentiation and favorability. Extamsa is the only extended-release oxycodone pain medicine that uses best-in-class abuse deterrent technology, also known as Deterrex. It is the number one highest rated ER oxycodone in terms of product differentiation and favorability among physicians. In total, our pain portfolio had revenues of $630 million last year, with about $420 million coming from Belbuca and Xtamsa combined. We expect sales from these two products combined to generally be flat this year with lower RX volumes, largely offset by improved profitability. As I mentioned previously, the Nusinta franchise is expected to begin to decline this year due to initial genetic competition, which began earlier in 2026. With that said, we still expect to generate meaningful revenues and cash flows from our pain portfolio both this year and in the coming years. This slide shows our patent expectations across the entire portfolio. The top portion is fairly straightforward, showing our ADHD medicines, which have patent protection out to March 2032 and December 2037, respectively, for Jornay PM and Starrus. To date, we have seen no generic endophilers for either product. Our pain portfolio is a bit more nuanced, which is where I will focus my time. Xtamsa has projected exclusivity until 2033, which provides us with the longest exclusivity within this portfolio. For Balbuca, there is a single generic company, Teva, that could potentially launch a generic version in January, 2027, based on a settlement they made with BDSI back in 2018. However, we believe they have also not received tentative approval and have relinquished their first filer status. it remains unclear whether teva will even want to re-enter the genetic opioid space given their change in strategy to focus on innovative branded medicines and and only the highest selling generics they've also stopped distributing other genetic opioids and have opted not to launch additional genetic opioids whose ip has expired including our own new center thus we continue to believe that we will maintain exclusivity for Belbuca until 2032 when key IP expires for the product. And finally, I have already mentioned our Nusinta franchise, which now has some competition from authorized generic products for both Nusinta and Nusinta ER, as well as from a separate third-party generic manufacturer for the immediate release form. I'd like to now highlight how we are strategically deploying our capital to create long-term shareholder value. We have a long history of successfully acquiring products and companies to drive revenue and adjusted EBITDA growth. Since 2020, we have acquired five different products and have been able to grow our annual revenues from $446 million in 2022 to an expected $840 million this year. Importantly, we also continue to increase our profitability with these acquisitions. We have seen our adjusted EBITDA grow from $266 million in 2022 to roughly $460 million last year, and we expect a similar amount this year. We continue to take a very disciplined approach to business development, with a focus on both the quality and the strategic fit of the products we acquire, as well as the economics of each transaction. in terms of the target therapeutic areas we are looking for we continue to prioritize psychiatry and pediatrics and other specialty conditions including rare diseases on a case-by-case basis in terms of key features we are looking for in potential new medicines they are commercial or near commercial have cost-effective sales and marketing requirements and have loes into the 2030s and beyond. Finally, given the strong profitability of our business and our confidence in the opportunities ahead, we have a track record of opportunistically returning capital to shareholders through share repurchases. Since 2021, we have returned $272 million of value to shareholders through share repurchases, including a $50 million ASR we announced last month. Looking ahead, we will continue to evaluate share repurchases as part of our broader capital allocation strategy. In summary, Collegium is well-positioned to positively impact the lives of patients with ADHD and pain conditions. And in return, we expect to create long-term value for our shareholders. Following the Astatus acquisition, our ADHD portfolio is on an exciting trajectory. our business fundamentals remain strong with significant cash flow and profitability providing financial flexibility to invest in our growth drivers strengthen our portfolio and return capital to shareholders we have an experienced and committed management team and board of directors that are helping guide our success i remain confident in our journey to building a leading diversified by a pharmaceutical company we have a clear strategy a differentiated portfolio and the financial discipline to create long-term value and I look forward to updating you on our continued progress thank you for joining us today