Seeking Alpha
We cover over 5K calls/quarter
Profile| Send Message|
( followers)

Hospira, Inc. (NYSE:HSP)

Q3 2010 Earnings Call

October 26, 2010 08:00 am ET

Executives

Chris Begley – Chairman and Chief Executive Officer

Tom Werner – Senior Vice President Finance, and Chief Financial Officer

Karen King – Vice President of Investor Relations

Analysts

David Roman – Goldman Sachs

Rick Wise – Leerink Swann

Gregg Gilbert – Bank of America

Ronny Gal – Sanford C. Bernstein

Chris Schott – J.P. Morgan

David Buck – Buckingham Research

Marshall Urist – Morgan Stanley

Gregory Hertz – Citi

Jayson Bedford – Raymond James

John Putnam – Capstone Investments

Operator

Welcome to Hospira's 2010 third quarter conference call. All lines have been placed on a listen-only-mode to prevent any background noise. Following the speakers’ remarks, there will be a question-and-answer period. (Operator Instructions) I will now turn the call over to Karen King, Vice President of Investor Relations. Karen, you may begin your conference.

Karen King

Thank you. Good morning, everyone, and welcome to our conference call and webcast regarding Hospira’s financial results for the third quarter of 2010. Participating in today's call are Chris Begley, Chairman and Chief Executive Officer of Hospira, and Tom Werner, Senior Vice President, Finance and Chief Financial officer.

We will be making some forward-looking statements today, which are subject to risks, uncertainties and other factors that may cause actual results to differ materially from those indicated. A discussion of these factors is included in the Risk Factors and MD&A sections in Hospira's latest annual report on Form 10-K and subsequent Form 10-Qs on file with the SEC. We undertake no obligation to release publicly any revisions to forward-looking statements as a result of subsequent events or developments.

In today's conference call, non-GAAP financial measures will be used to help investors understand Hospira's base business performance. These non-GAAP financial measures are reconciled to the comparable GAAP financial measures in the press release and Form 8-K issued this morning, and are also available on the presentation page in the Investor Relations section of our website.

Also posted on our website is a presentation of complementary materials that summarize the points of today's call. We will not be speaking directly to the material, which is posted on the presentation page at www.hospirainvestor.com. The material is for your reference as an enhanced communication tool.

Before I turn the call over to Chris, I just want to mention that we are having some bad weather in the Midwest, we are under a tornado warning. If we were, if the tornado bells were to go off, or the phone was to drop, we’ll go ahead and pick up the call as soon as possible.

With that, I'll now turn the call over to Chris.

Chris Begley

Thank you, Karen, and good morning everyone. If my voice sounds deeper or you hear some sneezing in the background, let me apologize beforehand. I came back from Europe over the weekend, I had the Board and myself in Europe, going through our operations, and I can tell you, I think the flu season has already begun. So I apologize for any raspiness in my voice.

The third quarter was a good quarter for Hospira. Despite facing difficult year over year comparison, due to our very successful launch of oxaliplatin in Q3 last year. As you recall, Q3 2009 represented the largest sales quarter for the major generic oncology drug while it was market. Since June 30, 2010 we temporarily exited the market due to a litigation settlement, and plan to re-enter in Q3 of 2012. Despite the extremely tough comparison to Q3 of 2009, our specialty injectable pharmaceuticals or SIP business declined only 3%. The impact of not selling oxaliplatin was tempered primarily by strength in precedex, meropenem, vancomycin, and heparin. Total net sales were $949 million this quarter, decreasing 6% year over year, with relatively no impact from foreign currency.

Excluding the year over year decline related to oxaliplatin, and divestitures, net sales increased 9%, versus Q3 of 2009. Adjusted earnings per share of $0.74 represented a decline of 18% over Q3 2009 EPS of $0.90, but better than our expectations for the quarter. The quarter saw several key Hospira achievements I would like to highlight. We received approval for the long term use of precedex, a proprietary sedation agent in Japan. This approval makes precedex available to a greater number of patients, providing a new sedative option for patients who are critically ill, and require sedation for greater than 24 hours. The long term use approval follows our launch of precedex earlier in the year, in Canada and South Korea. It is one more milestone to expanding the molecule’s global presence.

On the bio-similar’s front, we’re very pleased to receive approval from the Australian Therapeutic Goods Administration, the TGA, for nivestim, our second commercially available bio-similar. This was the first approval of bio-similar filgrastim in Australia, an important step in building our global bio-similar’s portfolio. Nivestim is our brand name for our bio-similar filgrastim, which is a drug used to boost white blood cells. We launched this drug earlier in the year in Europe, and will be leveraging the specialized hematology/oncology sales force we’ve developed across the Australian region to market nivestim.

We completed a commercial collaboration and co-development agreement with Smith’s Medical, for infusion pump systems in the US and Canada. This collaboration allows us to broaden our portfolio offering and extend our reach. It also enables the development of interoperable solutions for our respective customers, which means that Hospira devices and Smith syringe pumps will be able to use one standard solution to view, and report infusion data through Hospira’s mednet technology.

As part of the theradoc clinical surveillance platform, we introduced our new, anticoagulation assist knowledge module. The module helps streamline caregiver communication, improve clinical workflow, and enhance patient safety, ultimately helping hospitals comply with one of the 2010 joint commission national patient safety goals. To reduce the risk of adverse events associated with anti-coagulation therapy. And finally, more recently, we were pleased to announce last week the launch of piperacillin and tazobactam in the US. This drug, a generic version of Zosyn, is a broad spectrum antibiotic that had US sales of $855 million in 2009. We are launching an aphased approach, both vials, and our proprietary advantage system, which we believe will be well received.

We already offer the drug in Europe, and plan to launch it in our Asia/Pacific region beginning late this year, and into early 2011. Before I turn the call over to Tom, I would like to update you on our quality improvement initiatives as well as the search for my successor as CEO.

Regarding the warning letter we received from the US FDA related to the inspections of our manufacturing facilities in Clayton and Rocky Mount, North Carolina; we continue to make good progress during the quarter. We are on track to fulfill our planned commitments, most of which we expect to complete by year end. We also recently resumed delivery of propofol under the new manufacturing process.

On the device side of the business, we have completed replacement of the bulk of the sets related to the air in line issue with our Symbiq general infusion device, and our hoping to complete the recall by the end of the year. However, to ensure we are providing our customers with the highest quality devices available on the market, we have decided to implement certain software enhancements relating to this, and previously announced issues. We expect these enhancements will be filed with a broader software upgrade package early in Q1 2011. Thus, at this time, approval timing remains uncertain. New pump placements will remain on voluntary hold until our corrected activities are completed.

And to update you on the search for my successor as CEO; we commenced the search for a new CEO on August, using Egon Zehnder, a global leader in executive search. Since that time, Egon Zehnder has received interest from several dozen candidates, and narrowed that list to a short list. They are currently in the process of screening and interviewing the short list candidates. The Board has been pleased with the interest and qualifications of the candidates, and looks forward to conducting interviews over the next couple of months. As I mentioned at the onset of my CEO retirement announcement, I will remain in place as CEO as long as it takes to find my replacement, and then transition to the new role of executive chairman. Those of you who know me, realize how important this is to me.

I want to make sure that we not only get the right person for the job at Hospira, but also that the transition go smoothly for all of our stake-holders. With that, I’ll now turn the call over to Tom, for an overview of our financial results. Tom?

Tom Werner

Thanks, Chris, and good morning everyone. I’ll remind everyone that references to net sales results will be on a constant currency basis, which excludes the impact of foreign currency fluctuations. Please refer to the table and the schedules accompanying the press release for the impact of foreign currency by segment and product line.

Global net sales declined 6% in the quarter, on a year over year basis, but as Chris mentioned, excluding the impact of oxaliplatin, and the divestitures, global net sales actually increased 9%. Global specialty injectibles net sales declined 3%, given an extremely tough year over year comparison due to oxaliplatin. By segment, net specialty injectible sales in the Americas were down 4% for Q3, while strong sales of oxaliplatin carried us through the first half of the year, reflected in the 18% year to date, year over year performance, several of our other SIP drugs, precedex, meropenem, Vancomycin, and heparin, performed very well in Q3.

Drilling down into the growth drivers for the quarter, we say another quarter of strong demand for precedex. It’s been a very solid growth year for the drug. First, precedex has gained an extremely strong reputation as a sedation agent, addressing an unmet clinical need among anesthesiologists and critical care physicians. Second, our specialized sales force has been highly effective at communicating the differentiating attributes of the drug to new prescribers, and thereby improving market penetration.

We mentioned on our call last quarter that we launched the anti- infective drug meropenem in the US at the tail end of Q2. Q3 was the first full quarter where we saw a positive financial impact. Being the only generic on the market so far, we’ve quickly gained market share and currently hold approximately 30% of the total US market.

Moving to vancomycin, we made good progress during the quarter at reducing our back orders and maintaining our number one share position. We’re currently meeting market demand, and are building inventory levels back up to our targeted levels. We also saw continued momentum for our new presentations of high dose heparin. While additional competition has entered the market, pricing has remained relatively stable and we’ve maintained our market share of over 20%.

Turning to EMEA, net sales of specialty injectibles in the European region increased 75 in the quarter, driving the quarter’s results was continued momentum in many of our recently launched molecules and the introduction of docetaxel in countries throughout Europe this year. Retacrit, our first bio-similar, had another solid quarter and continues to hold its leading position in the total short acting bio-generic epo market in Europe. Net sales of specialty injectibles in Asia/Pacific decreased 7% over the prior year Q3, due primarily to aggressive pricing in both oncology and anti-infectives. Response to precedix in Japan has continued to be positive, bolstered by the recent approval of the long term indication.

Turning now to devices, net sales of global medication management systems were down 6% versus Q3 of 2009, primarily a result of performance in the Americas, where MMS net sales declined 8%. First, Symbiq remains on ship hold, and as a result, we did not recognize any new customer pump related sales for this infusion device in Q3. Second, we characterized the quarter by a general slowdown in pump sales activity, as prospective customers work through the evaluation and decision making process, related to choosing their next pump platform. We anticipate a soft market through the remainder of the year, with increased activity in 2011 and 2012 as Baxter Colleague customers begin executing on their decisions.

Outside the America’s, MMS net sales increased 7% year over year, in EMEA, and 13% in Asia/Pacific. Both regions experienced continued momentum with dedicated set sales for our Plum general infusion device, and our gemstar ambulatory device.

Sales in both our Other Pharma and other device product lines decreased across all regions in the quarter, primarily due to the divestitures we’ve completed over the past 18 months. Other Pharma also experienced a particularly soft quarter, as the back order issues discussed on the Q2 call impacted our ability to supply to certain contract manufacturing customers.

Moving down the rest of the income statement, adjusted gross margin in the quarter was 42.8%, up 130 basis points compared to 41.5% in Q3 2009. Contributing to the improvement was favorable product mix, driven by precedex, as well as cross reductions associated with Project Fuel efforts. These factors were partially offset by charges associated with the FDA warning letter and our voluntary ship holds.

In addition, we incurred pretax one time charges of $15 million during the quarter related to quality consulting and assessment activity, idle facility cost, all associated with our quality improvement efforts.

R & D expense increased 13% in the quarter, to $65 million, primarily a result of the timing of spending related to clinical trials. R & D as a percentage of net sales was 6.9% up from 5.7% in last year’s Q3. SG&A expense for Q3 was $159 million, down 2% from $162 million for the same period last year. Driving the improved SG & A performance were cost reductions associated with Project Fuel initiatives as well as the timing of certain spending.

SG&A as a percentage of net sales was 16.7%, compared to 16.1% in the Q3 of 2009. Adjusted operating income decreased 9% to $189 million, versus $207 million in Q3 of last year. Adjusted operating margin, at 19.9% decreased by 70 basis points versus 20.6% in last year’s Q3. We continue to make significant progress year to date on Project Fuel, and are on track to meet our estimate of $70 to $80 million in cumulative savings this year in $110 to $140 million in cumulative savings in 2011. Interest expense increased 6% to $27 million in Q3, from $25 million last year, due to a partial quarter of additional but temporary interest associated with our new $500 million of 30 year debt. Earlier this month, that’s October, the proceeds in cash on hand were used to pay down our $500 million in five year debt, that was originally due in 2012, thereby eliminating future incremental interest expense.

Related to the early debt repayment was a onetime charge for the early extinguishment of debt of $36.8 million, in Q3 that as I mentioned, was paid in October. The charges included in other expense nets on the income statement. Our effective tax rate on an adjusted basis in the quarter was 23.8%, bringing our year to date tax rate to 25.0%. This continues to be higher than we anticipated due to the fact that Congress has not yet approved anticipated extensions of tax provisions that expired at the beginning of this year. Our adjusted diluted earnings per share for Q3 was $0.74, compared to $0.90 last year.

Turning to cash flow, cash flow from operations for the nine months ended September 30th, 2010, was $235 million compared to $541 million for the same period last year. The decrease was primarily a result of the expected 2010 payout of chargebacks and rebates as 2009 sales of oxaliplatin moved from the wholesaler to the end user, as well as increased inventories to improve our service levels, and increased income tax and quality initiative related payments. At September 30th, our cash balance was $1.1 billion, compared to $946 million at December 31, 2009, and $921 million at September 30, 2009. The increase since the end of last year was primarily related to the timing of the new issuance of the $500 million in 30 year notes, partially offset by the acquisition of Orchid and Javelin and other investment related activities.

Capital spending in the quarter was $62 million, compared to $41 million in the same period last year. The increase primarily reflects investments we’re making with respect to manufacturing improvement initiatives, and IT infrastructure enhancements.

As we have discussed in previous calls, at the end of Q2 we had a remaining share buyback authorization of approximately $100 million, out of the original $400 million authorization that was approved in 2006 by our Board of Directors. During this quarter, Q3, to address the share count creep associated with stock options, we entered into an accelerated share repurchase for ASR contract, to repurchase $50 million of our common stock. Under the ASR, we received approximately725,000 shares with the remaining shares to be delivered over three months, subject to adjustments based on the average stock price during the period. The ASR is expected to be completed no later than November 23 of this year. Since 2006, as of the end of Q3 this year, we’ve cumulatively repurchased 8.3 million shares, for $350 million in aggregate purchases, under the Board authorization. At the end of Q3, our outstanding diluted share count was at approximately 170 million shares.

Turning now to full year guidance, during our Q2 earnings call in July, we projected 2010 global net sales growth of 3 to 5% and earnings per share, adjusted earnings per share in the range of $3.35 to $3.45. Since then, several items have surfaced that could have an impact on guidance. Starting with sales, there are two primary factors that could affect guidance. First, as we discussed earlier, in our MMS business, this quarter was characterized by a general slowdown in pump sales activity. We believe the market is somewhat frozen, as prospective customers work through the evaluation and decision making process related to changes in their next pump platform. We don’t expect to see a change in activity until sometime in 2011, when we believe Baxter Colleague customers will start to execute on their device decisions. As a result, we’ve reduced our MMS sales expectations for the remainder of the year.

The second item relates to the increase in backorders, which we discussed on the Q2 call. The backorder increase was driven primarily by delays in deliveries as a result of our quality enhancement initiatives, and on certain drugs, capacity related constraints. Our contract manufacturing business, which is reflected in the Other Pharma product line, utilizes some of the same capacity in our manufacturing facilities and the buildup in back orders, and accompanying delays in delivery, have impacted certain contract manufacturing customers. While we’re making progress on reducing these backorders, our inability to adequately supply product will result in lower than anticipated performance in the Other Pharma product line for this year. So primarily as a result of these two items, we’re reducing our full year global net sales growth by 1%. We therefore expect net sales to range between net sales growth to range between 2 and 3% on a constant currency basis, with foreign exchange contributing a1% benefit.

We’re maintaining our gross margin range of 42 to 43%, and our operating margin range of 20 to 21%. Our adjusted tax rate guidance remains at 22 to 23% for 2010. This projection is based on the assumption that certain US tax provisions will still be renewed before year end, retroactive to January 1st of this year. We therefore expect that our effective tax rate in Q4 will be lower than the first nine months of the year, bringing the full year rate in line with our original expectations. Now, obviously there’s risk in this assumption, if these provisions are not renewed by Congress.

Moving to earnings per share, we feel confident we can meet the favorable end of many of these projected ranges, and as a result, we’re narrowing our adjusted EPS guidance to the upper end of our previous guidance, and now expect adjusted EPS to range between $3.40 and $3.45 per share, representing growth of 9 to 11% over 2009. While consensus EPS is currently above our estimated range of $3.40 to $3.45, I want to reiterate that our 2010 guidance at this point does not include any US sales of docetaxel or gemcitabine . It also does not include or assume resumption of sales of Symbiq devices to new customers in 2010.

However, the guidance does include the expected impact of our launch last week of generic Zosyn. Based on many of the analyst notes published last week, I’d like to clarify a few issues regarding generic Zosyn. First, today we are focused on the single dose vial and frozen pre-mixed markets. Second, the impact in 2010 will be limited, as the product is being rolled out on a gradual basis, with single dose vials already on market, an advantage starting to ship toward the beginning of next year. Third, product sales will steadily ramp up over time, as capacity ramps up. And fourth, as we’ve mentioned in prior calls, the product is a partner product with shared margins. We continue to exclude docetaxel and gemcitabine from our full year guidance, because they are litigated drugs which still carry a degree of launch uncertainty.

However, we are providing an update this morning on both drugs, as well as some color on how to thing about the potential opportunity this year. Starting with docetaxel , last month the US District Court of Delaware decided that the originator’s patents, asserted against us are invalid, ruling strongly in our favor. The originator has appealed this decision. We have tentative approval on our single vial product and will be ready to launch in mid-November, assuming we receive final FDA approval.

We are assuming that two other generic competitors will be on market day one, including an authorized generic, and that the originator will stay in the market with a discounted price. We also believe the originator will convert the market to a single vial solution product and that we will be the only generic competitor with this offering.

Moving to gemcitabine , in August the Federal Circuit Court affirmed the District Court’s decision of invalidity in the Sun versus Lilly case. This ruling paved the way for us to launch our 2 gram powder presentation as an exclusive offering for a 180 day period. In late September, we filed a declaratory judgment action against Lilly. The action relates to a process patent we have litigated in other jurisdictions. We took this action pre-emptively in the US to help secure a clear launch. We have tentative approval for our 2 gram Lyophilized powder format, and as with docetaxel , will be ready to launch in mid-November, assuming we receive final FDA approval. We are assuming, on gemcitabine , that two other generic competitors will be on market day one, including an authorized generic and that the originator will maintain branded pricing levels.

You may also recall that we filed a 505B2 more recently, for a differentiated solution gemcitabine product, which is pending FDA approval. Now, if docetaxel and gemcitabine do launch before year end, the sales and EPS impact could vary significantly, based on the number and launch dates of competitors, the legal position, and pricing dynamics. We estimate that a Q4 launch of both docetaxel and 2 gram gemcitabine freeze dried product in the US could add an incremental $0.10 to $0.15 to our EPS guidance. The majority of this total estimated increase is related to the potential docetaxel launch, where we would launch all of our presentations of the drug, versus gemcitabine , where we’d only be launching our 2 gram product. With that, I’ll turn the call back to Chris.

Chris Begley

With solid results for Q3, Hospira is on track to deliver another great year, bolstered by strong performance in our specialty injectable pharmaceutical business, and continued contributions from Project Fuel. During the quarter, we gained momentum on several of our existing and newly launched drugs, and made advancements to expand our global business. We also made progress on our quality improvement initiatives, working diligently to ensure we are delivering the highest quality products to our customers and patients. We believe the efforts and advancements we are making this year position us for continued growth going forward as well. We look forward to discussing our expectations for 2011, and longer term guidance when we report our Q4 and full year results in early February. With that, we are now ready to take questions. Operator?

Question-and-Answer Session

Operator

(Operator Instructions.) Our first question comes from the line of David Roman, with Goldman Sachs.

David Roman – Goldman Sachs

Hi, good morning everyone. Thank you for taking the question. I just want one quick point of clarification. On the 9% underlying growth, excluding divestitures in (inaudible , can you give us some sense as to how much of that, whether there was any contribution from Orchid in there, so we could get a sense that the organic growth rate was this quarter?

Tom Werner

David, it’s Tom, good morning. Orchid was pretty minimal in the quarter. It would drop the 9 a little bit, but not substantially, and we don’t disclose the amount separately, but it’s pretty small.

David Roman – Goldman Sachs

Okay, and then on the gross margin this quarter, it’s still showing pretty big numbers, I think relative to what people were expecting. Maybe if you look at the sequential change, obviously a lot of the drop had to do with not having oxaliplatin, but an underlying basis is, it is a good way, is the 42%-ish number this quarter a fair representation of what your business looks like, excluding things like oxaliplatin, docetaxel, etc.?

Tom Werner

We had a small amount of chargeback adjustment in the quarter for not having oxaliplatin, but it was very, very small, so I would say that your conclusion is probably a good one. The guidance this year, we’re sort of maintaining this 42 to 43%, we’ve said that Project Fuel would get us into the low 40s, and as we look at Q4 with fairly strong mix, the margins have to be fairly close to what there were in Q4. They’ll be down slightly, but not much. So it’s probably not a bad benchmark.

David Roman – Goldman Sachs

Okay, and then the last question, on the incremental potential, so $0.10 to $0.15 that you could generate in Q4, from an operating expense perspective, I’m assuming that most, the drop due rate is pretty high, most of that comes from gross profit, there wouldn’t be much incremental SG &A associated with sales in those product categories?

Tom Werner

Yes, that’s correct. But the gross margin profile on pip taz versus the other two is quite different, because it is a partnered product, so the profitability there will be substantially less than the other products, but there won’t be any incremental SG&A expense. That’s the beauty of our model, is that with the GPO contracts that we’ve got in place, as we bring new launches in, there’ll be some slight increases in commission, but that’s about it.

David Roman – Goldman Sachs

Okay, that’s very helpful. Thank you.

Tom Werner

Thank you, David.

Operator

Our next question comes from the line of Rick Wise with Leerink Swann.

Rick Wise – Leerink Swann

Good morning Chris, good morning, Tom. You’re going to hate this question, but Q4 of this year is confusing enough, and I know it’s earlier than you want to talk about 2011, but we’re all going to have to, after this call, go back and make some assumptions. Is there anything you can help us with in thinking about organic growth rates, and we can make our own assumptions about gemcitabine and docetaxel, to layer on top of that? Again, anything – is the goal next year to grow EPS double digits? Anything? We’ll take it.

Tom Werner

Yeah, I’m afraid there won’t be much to take. You know, it’s just – we’re in the middle of a planning process for 2011, and we’re going to be revising as necessary our longer term projections. You know, I think you can kind of look at some of the quarters this year as we reported with and without oxali and with and without divestitures, the old guidance said expectations had been high single digit growth, and I don’t – at this point we haven’t extended that into 2011, but it’s just a little bit too early to talk about that. I think what’s going to make things even more complicated, Rick, as we get into next year; you know, early February and begin to give our guidance for 2011 as well as longer term expectations, that the range of outcomes for docetaxel and gemcitabine is – there’s a huge difference between the upper and lower end of things. There are just so many different variables in play, including the fact that we haven’t yet launched. So sorry I can’t be of more help.

Rick Wise – Leerink Swann

Had to try. Help us also understand a little bit more color about what changed in terms of the guidance, lowering average sale on the MMS side – what do you know today that you didn’t understand three months ago, about the likelihood of customers taking time to figure things out this year. They’re telling you “We’re just not going to decide this year”? What changed?

Tom Werner

I think our comments at Q2 were somewhat cautionary, that we were starting to see some stall. I think the other thing that had changed is that the communication from Baxter, I think unless I’m wrong, actually was made in July, late July, so very close to when we had our Q2 calls. So I think things have just solidified a little bit more, and the situation has become clearer, but you know, we had a sense that this was the case in Q2. We’ve now seen Q3 results, we’ve looked at the order backlog, not back orders, but the order backlog for equipment and it’s sort of confirming what we thought when we talked at the end of Q2.

Rick Wise – Leerink Swann

Okay, just last, maybe just a –

Chris Begley

Before you go on, the only other thing I would add to that is we really still believe the MMS opportunity is a great opportunity, all right? And as Tom said, you know, we’re seeing that the market has stalled, and that’s because the decision is so complex, and has been made even more complex with the situation of the recall from one of the competitors. Having said that, we’re in a lot of different conversations with customers, dialoguing about what their needs are timing wise, etc., and we’ve had some very nice wins from a pump standpoint. Market share gains, and some fairly large integrated systems, and then in addition to that, even though we have this voluntary hold on Symbiq, we still have had some nice wins with Symbiq as well, where the customer is willing to wait until we have Symbiq available, or they’ve decided to bridge with Plum for some period of time, and then move to Symbiq. So you know, the market is stalled, there’s no question about that, but there’s not a lack of activity at all, and it’s a matter of when this thing’s going to pop. It’s eventually going to have to pop, because there is a deadline as to when the pumps have to be out of there.

Tom Werner

Adding to that, Rick, not to beat this to death, is that the capital spending environment hasn’t gotten any better either. So you couple these two factors and our best intelligence through the sales force is that people are just a little bit uncertain right now, and will begin making decisions here beginning of next year.

Rick Wise – Leerink Swann

And my question, it sounds like though, despite the (inaudible 0:15:29.0 you guys are pretty optimistic, or hopeful anyway, about gaining share once these decisions start getting made.

Tom Werner

We still are optimistic that there’s a good opportunity here, and between our product offering of Plum and Symbiq that we’ve got a very nice diverse product offering, depending upon what the customer’s needs are.

Rick Wise – Leerink Swann

Thanks so much.

Tom Werner

Thank you.

Operator

And our next question comes from Greg Gilbert with BofA Merrill Lynch.

Greg Gilbert -- BofA Merrill Lynch

Morning guys. First, a bigger picture question on SIT. I think US is the focus. Can you describe the factors that have led to the back order situation, and why those factors don’t affect gemcitabine and docetaxel, and then how your customer relationships feel at the moment, in light of the back order situation?

Tom Werner

Yeah, it’s just sort of to replay how we got to where we got and then why we don’t think we’ve got issues with those two, it’s really a combination of three or four factors. First, the whole quality situation, the slowdown that we’ve put in place on batch release. We’ve increased cycle times, we’re getting new procedures in place; second, we did have some localized focus capacity issues that were not really attributed to the quality situation, but just as we’ve grown this business from a 13% share in the available market to almost 19% in six years, and as we shut some factories down and so on, we ran into some capacity issues on vanco and a few other products. Third, you know, while we were in a back order situation for some of our own internal reasons, there have been various competitors, I won’t name them, who are off market and have exited certain products and customers are now coming to us. Customers who might not have previously purchased from us, so it’s been difficult to sort of weed through the back orders and figure out what’s a back order and what’s not, because in some of these situations that are well chronicled on the FDA site, people will order quite a bit more than they really need, in hopes that they get what they really consume. So those are sort of the three or four factors that have come into play, and on gemcitabine and docetaxel, the facilities that those products are coming out of are not directly impacted by the quality situation, nor are they directly impacted by other capacity issues, so that’s kind of the long and short of it.

Greg Gilbert -- BofA Merrill Lynch

And then can I ask you to quantify and help us with the timeline for the propofol opportunity? And is there any interplay there with precedex at all?

Tom Werner

There has been increased demand for precedex while propofol has been in shortage. It hasn’t been substantial or material, but as we mentioned in Chris’ comments, we had shipped previously manufactured product under the initial manufacturing process modifications, and the good news is just very recently we resumed shipments of propofol under the new process, so we’re back in business, and we’re going to begin ramping capacity as we see fit.

Greg Gilbert -- BofA Merrill Lynch

Can you help us quantify that opportunity, what sales used to be, perhaps? Or what the market is now at brand price? Any of the above?

Tom Werner

Yeah, I think IMS probably have propofol somewhere between 20 and 30 million for us, on an annual basis, and you know, we obviously have to get back to that before we begin to gain some share from others who have exited the market, or those who have gained share during the temporary supply disruption.

Greg Gilbert -- BofA Merrill Lynch

All right, thanks guys.

Operator

Our next question comes from the line of Ronny Gal, with Sanford C. Bernstein.

Ronny Gal – Sanford C. Bernstein

Good morning, and thanks for taking my question. Just roll in for a second on Greg’s questions, can you just more specifically tell us about your capacity on propofol, gemzar and taxotere? Especially, are you able to supply as much as the market will demand on those, or are there still some restrictions to your ability to supply the market?

Tom Werner

On docetaxel and gemcitabine, Ronny, we don’t see any issues with supplying the market. Propoful, we’ve got to ramp back up to get to where we were, and see how things go. And although you didn’t ask it, we are somewhat capacity limited on pip taz right now, and you have to factor that in to the sales impact this year, as well as next year. Bu the API there, and Chris can elaborate on this, it’s just a very difficult API to manufacture, and it’s traditionally been in somewhat short supply, and I think, as you’ve seen the initial generic gains, they’ve been not as substantial as you might have expected, so that is one where we will be capacity constrained for the mid-term, but we’ll begin ramping up and then shipping advantage toward the beginning of the year. Chris, anything you’d add on that at all?

Chris Begley

I think the only other color I’d give is Tom is 100% correct in the way he characterized that, and we generally aim for a 20 to 30% market share, and because of the supply constraints that Tom just covered, you know, the 20 to 30% market share goal that we have will probably take 18 to 24 months to ramp up to those levels. But again, remember this is the partnered product, so we have a little less control from a timing standpoint, etc., but as we’ve looked at it and analyzed it, it’s from 18 to 24 month time period to get us up to the 20 to 30% market share target. Does that help, Ronny?

Ronny Gal – Sanford C. Bernstein

That clarifies a lot. Thank you very much. A second one is around the cost mix. You know, we’ve seen a lot of movement in currencies, and we can model the revenue pretty well, but can you give us an idea about your cost mix by geography? Between Asia/Pacific, Europe, and the United States?

Tom Werner

I can give you some kind of relative comments here. FX, just on a top line basis, as we mentioned earlier, we thought would be a bit of a headwind coming into Q4, when we last spoke, and based on current rates, we don’t think there’s going to be much of an impact at all. In terms of the cost mix, just to explain a little bit about our geography and where we make product, and I would really point to probably three geographies, and just give you some relative comments. In Australia, proportionately, we make a lot more than we sell, because the Mulgrave facility which is the primary oncolytic drug facility for us ships all over the world, yet the in country sales in Australia are proportionately, substantially less, so you’ve got a bit of a cost heavy revenue, light situation in Australia. To go to Canada, we don’t manufacture anything in Canada, so we have some exposure there in that we’re sort of revenue heavy, and all the cost from Canada is either coming out of the US, a little bit out of Europe, and some out of Australia. In Europe, proportionately, we sell a lot more then we make, we do have one factory, two factories in Europe; one in Croatia and one in Italy. Actually where Chris was at the previous week, but relative to the income statement in Europe, we’re selling a lot more product there than we are locally sourcing, so without giving specific numbers, those are sort of the disproportionate relationships.

Ronny Gal – Sanford C. Bernstein

Okay, and last one, about the use of cash. As I project, your cash use forward, it looks like somewhere in the second half of 2011, you’ll become essentially debt neutral. Now, generic businesses generally run a lot higher than that, and given that we’re in a favorable borrowing environment, we’re just wondering how you guys think about use of cash, going forward? Is this a good time to start thinking about expanding of operations? It’s been a few years since you (inaudible 0:24:04.5 and so forth.

Tom Werner

Yeah, the – you know, everything is sort of relative to prior to the financial meltdown, we were looking at debt to equity levels that were in the high 30s, and we thought those were sort of okay, yet in early 2009 you could see across all industry sectors the damage that was done to share prices to companies that had higher than average debt levels. So, you know, today debt is very attractive. One of the reasons that we decided to do the refi at the time we did is just how attractive and open the markets are, our maturity, average maturity length right now is about 13 years, which puts us sort of in the upper quartile level of our peers. As you look to next year and the cash accumulating, we really need to get through our 2011 planning process, we need to then present our longer range plan to the Board in February, and I think at that point we’ll be a lot clearer on what uses and priority of cash will be. In terms of taking on additional debt, it’s just too early to call that right now, despite how attractive things are, because we’re kind of between this position of what’s an acceptable level and you know, you go back two or three years, we thought we were in fine shape, and then frankly the stock in others got hammered because it was above average. So we’ve just kind of got to let this play out, the tax laws changing with respect to dividends, we’ve got a lot of moving pieces. So sorry I can’t be a little more clear at this point, but we will be in the coming months.

Ronny Gal – Sanford C. Bernstein

Okay, well thank you very much.

Tom Werner

Thanks, Ronny.

Operator

Our next question comes from the line of Chris Schott with J.P. Morgan.

Chris Schott – J.P. Morgan

Just coming back to Zosyn for a second, can you just elaborate a little bit on the competitive dynamics you’re anticipating in this market? I understand your capacity restraints, and I know it’s a difficult product, but are you anticipating any additional fires coming here in the near term?

Tom Werner

At this point, YF it remains in the market, I believe they have dropped price slightly. Apotex is also in, as far as other competitors entering, let me just kind of check my notes here. We don’t anticipate anybody this quarter, and at this point, it just really doesn’t look like anything else is imminent in terms of additional entries. So you know, YF is out there, Sandoz is now with us, and Sandoz appears to be more heavily marketing these products than some of the other products we partner with them on, and then apotex; but Chris or Karen, unless I’m missing something, I don’t know that anything else is looked as an imminent entry.

Chris Begley

No, Tom, you’re right. There’s two generic players out there, ourselves, and then the innovator.

Chris Schott – J.P. Morgan

Okay, great. So second question was coming back to gross margins. Based on your performance year to date, am I right in assuming that you’re looking at gross margins as essentially down in Q4, and if so, what exactly is driving that assumption?

Tom Werner

They’ll be down slightly, but it’s just several 20,30 basis points, nothing big. It’s – we’ve got factory shutdowns that take place in Q4, product mix shouldn’t be terribly different, but it’s not moving enough to really even attribute to any one thing.

Chris Schott – J.P. Morgan

Okay, great. And then just a final question, as you mentioned before, obviously there’s a lot of variables that could come into play in 2011. If I think about the upside case of taxotere and gemzar over the next 12 to 18 months, where do we see that play out? Can you just elaborate a little bit more on how you think about the use of that excess cash flow? If you were to see taxotere and gemzar go better than expected, or hit your upside case, should we expect to see the company reinvest some of that profit in terms of accelerating fall and biologic programs, or other R & D programs, or just without going into specific guidance for 2011, just how are you evaluating those upside cases and what you potentially would do with that cash flow?

Tom Werner

There’s been various reports written, that Chris, yourself and others, there’s no tie in here whatsoever. When we look at R & D projects, we don’t look at what’s going on paragraph four launches and then decide to go after certain programs or not. You know, those things are independently analyzed, there are certain hurdle rates that have to be met, you can call it coincidental, but you know, the fact that SG&A spending picked up in Q3 last year when oxali hit, there was no relation whatsoever. I went back and researched this. What happened at the time was the expenses related to some of the Project Fuel initiatives that couldn’t get one time treatment sort of kicked in, and the R&D plans have been in place. We had those plans in place before we even knew oxaliplatin was going to launch, so there’s no quid pro quo here where something launches and it’s more profitable than we expect and then we go out and fund other things. We’ve got a disciplined approach in place for general administrative expenses. They’ve been under tight scrutiny with Project Fuel, and R&D, each project is funded based on its own merits, and whether we can afford them or not, one does not go to fund the other.

Chris Schott – J.P. Morgan

Great, I appreciate the color. Thank you.

Operator

And our next question comes from the line of David Buck of Buckingham.

David Buck – Buckingham Research

Thanks for taking the questions. Some have been answered already, but I guess one for Tom. Can you just talk a little bit about the impact, maybe overall, of capacity constraints and backorders on the quarter, and when do you think you may be back to normal? For Chris, you talked a little bit about the selling cycle for medication management business, can you elaborate a little bit more about how you’re positioning with the uncertainty of Simbiq right now, in terms of when that can come on the market, and maybe get a sense of whether it’s the second half 2011, ramping you might expect, or when do you think you might be able to grow that business in the first half? Thank you.

Chris Begley

Let me take the Simbiq question first. You know, the way we’re viewing that right now is until we actually make the filing; as I mentioned in my opening comments, in early Q1 of next year, it’s really hard to get your arms around when to expect the hold to be released on Symbiq. We will have a much better feel for that, come Q1, and so you’ll hear more from us at that point in time, but as a I also said, in the interim, we’ve got customers who are signing contracts for Symbiq as we speak, and are waiting for the device. And then we also have customers that we’ve taken and placed Plums with the intent to move Symbiq in there afterwards. So you know, we continue our sales effort on Symbiq, even though the product is on a self imposed hold by Hospira.

Tom Werner

Back on the backorders, you know we did make really good progress in the quarter, a substantial amount of backorders, as I mentioned, with competitors off market on things like propoful and everything, it sort of exacerbated what the normal level of backorders would be, even if we were just temporarily production disrupted, so we made good progress in Q3, we’re going to continue to make good progress in Q4, but frankly we won’t have the backorders down to the levels we had seen probably until the middle of next year. Certain capacity still needs to come online, but they’ll be substantially reduced from where they were at and you can see, with Vanco, good progress made there. Propofol as well, and then a number of the narcotics beginning to come back on.

David Buck – Buckingham Research

One final followup. On gross margin, with Project Fuel for next year, and the targeted savings, this year’s 42 to 43%, what should the target be for gross margin?

Tom Werner

Well, you know, now in Project Fuel – well, we’ll really just get to that when we give 11 guidance.

David Buck – Buckingham Research

Okay, fair enough. Thank you.

Tom Werner

Thank you very much.

Operator

And in the interest of time, we’d like to ask everyone that you limit your questions to one question. Thank you. Our next question comes from the line of Marshall Urist with Morgan Stanley.

Marshall Urist – Morgan Stanley

Hey you guys, good morning. Thanks for taking the questions. First one is I just wanted to get a little bit more detail on your comments about the Other Pharma business, and just how should we think about timelines there, as we look over the rest of the year and into 2011 to resolve some of those issues?

Tom Werner

Yeah, these are all temporary issues, and it’s just been a temporary disruption of shipments, but you know, we’ll be back to our normal level of business early Q2, maybe late Q1 of next year. So it’s just really a timing issue, and it’ll come back.

Marshall Urist – Morgan Stanley

Okay, perfect. Thanks, and then second, your thoughts, high level thoughts on the taxoter launch. I just wanted to get what you’re seeing today in terms of the CFE launching the single vial, is that currently ongoing? How do you see that playing out in terms of converting the market, and with you guys having the only other one vial formulation, how are you thinking about pricing?

Tom Werner

Well, your question was going real well until you asked “How are you thinking about pricing?”. Chris and Karen can chime in here as well. I think the fact that the innovator has introduced a single vial product is – you know, imitation is the sincerest form of flattery, I guess, so we’re encouraged that they, too, see the importance and the benefit of going to a single vial system. On pricing though, we’ve got to get to launch and really see what happens. You know, they have filed an appeal and it’s – we think there’s going to be the innovator plus an authorized generic, plus Sun, plus ourselves, and how this market converts over to single vial and whether we’re able to launch in mid-November, it still remains to be seen. So there’s just a wide range of pricing assumptions and we’re just going to have to test that real time, as we get ready to launch the product. So I really can’t give you much better information beyond wide ranges that various folks have out there.

Marshall Urist – Morgan Stanley

Okay, thanks. And then one last one. Now you’ve been asked a ton of questions on gross margin, but I’ll just ask it in a slightly different way. You’re clearly in target, or the high end of target right now. There’s still some one time quality investments that are dragging on gross margin, even at this level. If we (inaudible 0:36:07) understand the mix dynamics, obviously the Symbiq dynamic won’t change until sometime next year, but certainly, if you think about taxotere and gemzar, you know being relatively larger than those in terms of gross margin, certainly gross margin contribution, are there other mix drivers as we get over the next 12 months, than just laying out those basic ones? And the ongoing benefits of Fuel that we’re missing that might move in the other direction?

Tom Werner

Just with respect to the quality cost, we isolate the costs that we think are one time, and in the quarter, those are about $15 million. So those aren’t in the adjusted gross margin numbers. If you refer to the slide back on the website, there’s about $10 million in the quarter that was ongoing and while it’s not clear whether that annualized to 40, and therefore all has to go into the cost base, as we’re sorting through our 2011 plan, we just need to sort of figure out what we might have to offset some of that, but there will be some increased costs of production and hopefully other programs that we have in place can go to offsetting that. With respect to mix drivers, you’re correct on Symbiq, and we’ll have to see how the 11 guidance plays out, but precedex will continue to grow much faster than the business, the total business, because we’re launching precedex around the world. We’ve introduced it in Brazil, we’ve got a sales force in place, you saw the additional indication in Japan, it’s growing extremely well here in the US. Vandomycin is coming back, we’re not back to our historical market share levels, but we’ve rebounded and pricing has been fairly stable. Down a little bit, but nothing to worry about. Project Fuel you mentioned, and then you know, the wide range of outcomes assuming that one or both of these drugs is able to launch, would help. Frankly, pip taz will be a drag on margins, at least on gross margins, because they’re below company average, because of the profit split with Sandoz. However, on bottom line, they’ll help with the operating margin because there really is no incremental SG&A expense when we add that in to the sales kit. So those are really the main drivers of gross margin, but we’ll be able to elaborate more clearly on them when we give 11 guidance.

Marshall Urist – Morgan Stanley

Great, thank you for taking the question.

Operator

And our next question comes from the line of Gregory Hertz with Citi.

Gregory Hertz – Citi

Well, thank you for taking my question. Just one on the income statement side, and one on the product. For R&D, just wondering, are you still expecting to come around toward $70 million in Q4, and does that seem like a good base level, given the activity going on as far as trials?

Tom Werner

There will be an uptick in R&D in Q4, however, our numbers say it’s going to tick up from Q3 levels, but to say that that’s a new level, we’re initially guided to about 6.7% of sales this year, which I think worked out to somewhere around $260 million, so you know, that’s about $65 million a quarter, but granted, it can be really lumpy depending on what type of clinical studies are going on, so it’s just – the number doesn’t move from 60 to 30, but to sort of say that 70 would be a new benchmark, it’s going to bounce around, plus or minus off of that, depending on the clinical activity. But both in SG&A, as we mentioned in our opening comments, there was some favorable timing of spending, promotional expenses and some other things in marketing that we saw in Q3 that could spill over into Q4, and the forecast I have would show R & D going up in Q4, but as you know, historically we’ve had trouble spending money as fast as we initially think we can.

Gregory Hertz – Citi

Okay, thanks for that. And then, just with respect to (inaudible 0:40:42) can you clarify relative to some of the ongoing legal disputes, is it correct to assume that barring any of the legal disputes, that those products would be able to launch in the middle of November, and there would not be any (inaudible 0:41:05) tentative approval, especially for docetaxel, is not contingent upon some of the ongoing manufacturing issues?

Tom Werner

No, there’s no manufacturing issues related to docetaxel, and to your first question, yes, we’ll be ready to launch in all presentations as soon as we get final FDA approval, and that the appeal that the innovators put in on docetaxel isn’t upheld, we’ll be able to launch. We’re ready, we have product, the same is true in gemcitabine, the innovator there has filed an appeal or a court motion as well, that needs to play its way out. It will certainly, on gemcitabine, the launch – we would only be launching the 2gram, but you know, assuming the legal things sort of wash their way out, and we do get final approval, we have stock and we’re ready to go.

Gregory Hertz – Citi

And where’s that being manufactured at of?

Tom Werner

We don’t disclose individual manufacturing sites.

Gregory Hertz – Citi

And just one more, if I can, along with the timing for recapturing some shares, as you guys ramp back to normalized production levels, how long do you think that will take? Certainly your competitors would expect that they would make an effort to retain that share. Any visibility on that? On expectations?

Tom Werner

Well, I would cite two products, Vanco, you know, if you believe IMS, our share dropped down pretty substantially February, March of this year, but we rebounded nicely. We’re not quite back to where we were. As I said, pricing has been fairly stable. Down a couple of percentage points, but nothing we hadn’t expected, so we’re going to continue to rebound and Vancomycin, and expect a strong Q4. With respect to the other product I was going to mention, propofol, that’s probably not back to normal levels until probably the end of Q1, the beginning of Q2 next year. But the market is going to be very different. It doesn’t look as if there’s going to be as many competitors in that product as there were prior, so assuming all goes well with ramping production back up, we’ll look at our capacity situation and share gain in pricing as well.

Gregory Hertz – Citi

Okay, great. Thank you for taking my questions. I appreciate it.

Operator

Our next question comes from Jayson Bedford with Raymond James.

Jayson Bedford – Raymond James

Morning, I apologize, I missed the first half, if this has been covered, but US MMS, did you give an order growth number versus the dollar growth you provided in the release? I’m just trying to –

Tom Werner

No, we don’t disclose order levels.

Jayson Bedford – Raymond James

Okay.

Tom Werner

We did say that contract signings through Q2 were just about on par with last year. But that was Q2.

Jayson Bedford – Raymond James

No update for Q3?

Tom Werner

No, we didn’t give one.

Jayson Bedford – Raymond James

Okay, and then just – it sounds like you’ll give us both 2011 guidance and an update on the longer term growth dynamics in February. I guess, looking longer term, when you look beyond Project Fuel, can you give us a sense of any progress you’ve made in terms of identifying other sources of cost efficiencies in the business?

Tom Werner

We’ve been real encouraged with Project Fuel, and it’s opened our eyes to a lot of opportunities, and at this point, to say there’s a Project Fuel the second, it’s a little preliminary on that topic, but there’s good momentum here and people have learned quite a bit as we’ve looked at our cost structure and looked at opportunities to simplify the business, so you know, what we’ve learned is that in this business, particularly the generic pharma side, is you can’t stand still, and you need to continue to stay out in front of the cost curve, and whether it’s Project Fuel or other initiatives, we intend to do that. So we’re not going to sort of rest on our laurels and watch things pass us by. We’re going to continue to be aggressive and maybe get Project Fuel kind of completed here through the end of the year, but there’ll be other initiatives, and I think there’s a lot of good enthusiasm and optimism on the part of the people who worked on Project Fuel. Chris, anything you want to add to that?

Chris Begley

Yeah, I would. Not on the cost side, but on the growth side. I think that we shouldn’t really lose sight of the fact that we’ve made some very strategic investments for future growth. I’ll just name two that come to the top of my head, one is the dial a jack proprietary project, which we believe looks like a really strong product going forward, that meets an unmet clinical need, and it fits nicely from a synergistic standpoint with our precedex sales force around the world, and then we continue to make investments on precedex. We just recently added 40 sales reps in Brazil to sell precedex. So that is just beginning to ramp up, which as you know, will have a positive impact in 2012 and beyond as well. So we shouldn’t lose sight of the fact that we’re making investments for growth that will have longer term impact to our long range plans.

Jayson Bedford – Raymond James

Fair enough. Thank you.

Operator

And our final question comes from John Putnam with Capstone Investments.

John Putnam – Capstone Investments

Yeah, and thanks very much. I wondered if you might comment on the potential of taking Retacrit into some other markets, Asia/Pacific maybe, or other opportunities that might exist?

Tom Werner

Well, you know we’ve launched, I think we’re in 19 different countries in Europe right now. With respect to Asia/Pacific and Japan, I’m not even sure we have the rights to the product over there. Chris or Karen, any -?

Chris Begley

Let me elaborate a little bit. We constantly look at where we have the rights around the world, and whether it makes sense. I think one thing you have to keep in mind with Retacrit and a biosimilar is you need a dedicated sales organization, so as you look at some of the smaller countries, that investment may not make sense today, unless we’ve got an overall comprehensive strategy to bring other products into that sales organization, like we have done in Europe. Those products are proprietary pharmaceuticals in the oncology space, and also some unique oncology devices as well. So that’s something that we keep mining, and we keep expanding, but we make sure that from a financial standpoint that we’re able to get the returns. I know we have retocrit, but the other products that are needed in some of these smaller geographies.

John Putnam – Capstone Investments

Great, thanks very much.

Operator

And that will end our call today, so thank you for joining us, and have a good day.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.

THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!

This Transcript
All Transcripts