Amneal Pharmaceuticals (AMRX) Q2 2026 earnings call transcript

I will now turn the call over to Amneal's head of investor relations, Tony DeMayo.

Good morning. And thank you for joining Amneal Pharmaceuticals second quarter, 2026 Earnings Call. Today, we issued a press release reporting Q2 results. The earnings press release and presentation are available on the IR page of Amneal. com. Certain statements made on this call regarding matters that are not historical facts, including but not limited to management's outlook or predictions are forward-looking statements that are based solely on information that is now available to us.

So you see the sections entitled cautionary statements on forward-looking statements in our press release and presentation for factors that may impact future performance. We also discussed non-GAT measures, information on use of these measures and reconciliation to GAP are in the earnings release and presentation.

On the call today are Sharad and Chintup Patel, co-founders and co-CEOs. Passos Ponederas, CFO, Joe Renda for specialty, and Jason Daley, chief legal officer. I will now hand the call over to Sharad. Thank you.

Good morning, everyone. Amneal is in the midst of the most transformative period in our company's history. We are growing as one of the America's leading affordable medicines businesses with an increasingly diversified and high-impact medicines portfolio, including specialty brands, power stimulus, GLP ones, and complex generics across dosage forms, such as transdermals and injectables. As we executive a strategy, we're building a larger, more impactful amneal.

That continued momentum is reflected in our second quarter results, where the company delivered revenue of $796 million, adjusted a bit of $206 million, and adjusted EPS of 30 cents.

At the halfway point of the year, we're pleased to once again, raise over 2026 outlook. This year reflects our seventh consecutive year of top and bottom line growth.

As a purpose-driven company, we have a tremendous opportunity to help the next era of affordable medicines here in the United States and globally by expanding access for patients and providers.

While amneal has always been growth oriented, the scale of the opportunity in front of us today has never been greater.

With that, let me touch on key growth opportunities. First, in affordable medicines, our base business remains strong, resilient and growing, with highly relevant and in-demand therapies. In women's health, demand for transdermal patches increase following the revised FDA guidance late last year. We are increasing our capacity.

Looking forward, our pipeline remains focused on a high value opportunities, such as Landry or Tide, where complexity, reliable supply, customer relationship, and executions are key.

Second, in biosimilars, we're building a new large growth platform for amneal. With the pending acquisition of Akashiv, we would become a fully integrated global biosimilar player from development to commercial supply. At the time, and the timing is incredibly compelling. The US biosimilars market is entering a major growth cycle driven by an unprecedented way of biologics losing exclusivity.

Streamlined regulatory pathways, attractive commercial structures emerging including private labels, and accelerating market adoption. Over the next decade, 118 biologics are expected to lose exclusivity in the United States alone. With relatively limited development expected for most molecules, accordingly, we see a broad set of biosimilar opportunities with limited competition that can support reliable and repeatable value creation. Amneal is well positioned to capitalize on these opportunities.

Approximately 75% of our similar portfolio will be focused on targeted, lower competition, while 25% will address larger market opportunities. That mix gives us significant growth potential and meaningful upside.

Biosimilars align with our commercial strength as well. Through private label and customer relationship, we can bring products to market efficiently, leveraging our leading US retail and institutional presence, channel access and scale. This is a national extension of our affordable medicine strategy. Overall, biosimilars are the next major growth area for Amneal and fit directly in our mission, expanding access, avoiding affordability, and building a durable, long-term growth platform.

Third, in specialty, we have differentiated branded product portfolio. Traxxon continues to gain traction and recent phase four data reinforces its potential to become a false line treatment option for Parkinson's patient. Also, break your continues to see very strong uptake in its first several quarters on the market, as it addresses an important unmet need for migraine and cluster headache sufferers.

Fourth, in distribution, healthcare continues to provide diversification and access to important government and institutional channels, representing a meaningful opportunity to grow this business over time. In summary, we are incredibly excited about the ongoing strategic evolution of Amneal and highly confident in our ability to sustain this momentum going forward.

I'll now turn it over to Chintu. Thank you, Chirag, and good morning, everyone. I would like to thank our Amneal team for another quarter of very strong execution. Our team continues to deliver across operations, quality, supply chain, R&D, commercial execution and customer service. This consistency allows us to grow while also building towards the next generation of opportunities, such as specialty, biosimulars and GLB ones.

Let me begin with an update on one of our manufacturing sites in India. One week ago, the Gujarat region experienced a severe rainfall and flooding, which impacted one of our facilities in India. Most importantly, all Amneal employees are safe and accounted for. We expect a limited impact on the select number of products. We look to resume operations within the next few weeks.

I will provide an update on three areas. First, the strength of our operating platform. Second, the strategic fit and capability scholarship brings in biosimulars. And third, the continued momentum across our pipeline.

First, in operation, our global high-quality manufacturing and supply chain capabilities remain a core competitive advantage. If you walk into an Amneal facility today, it looks remarkably different than just several years ago. Through digitization, automation, and deploying AI tools in different areas, we are enabling our next generation of manufacturing and quality while also driving continued efficiencies. Strategically, we have built a broad operational network with deep expertise across those issues.

This matters more than ever. Patients, providers, and all stakeholders of the health care system are focused on the quality, reliability, and resiliency of the pharmaceutical supply chain. We are excited to expand our capabilities and capacity in complex dosage forms, including transformers, sterile injectables, and low-acting depots, enabling Amneal to increase our volumes and drive very meaningful reactor growth. Our scale, leading US manufacturing footprint and strong technical capabilities, who listens us to deliver reliable high-quality supply while addressing important market needs and drug shortages.

To that point, we are pleased to share that Amneal's Bluehaven New York site was recently selected as one of all seven companies in the FDA's pre-check by your program, alongside other leading companies, such as Eli Lilly and Regeneron. The program is intended to advance US drug manufacturing and strength and supply chain resiliency by allowing earlier FDA engagement on facility readiness and support access to critical matters.

For Amneal, it is an important recognition of our robust US manufacturing, particularly as we expand into sterile injectable manufacturing here in the US over the next few years.

Second, we are very excited about the QASHI acquisition, which will add the in-house biologics capabilities we need to succeed in biosimilars. The end-to-end capabilities will span cell-line and clone development, routine characterization, process development, clinical execution, regulatory expertise, and scaled biologics manufacturing in India and US. QASHI is a biologics platform built over a decade with deep scientific expertise across monoclonal antibodies, fusion proteins, cytokines, microbial products, and other complex modalities.

QASHI's drug substance capacity is expected to expand from approximately 26,000 liters by the end of 2026 to approximately 75,000 liters by 2028. With QASHI, we will be able to do it all in biologics. QASHI brings the science, development, and manufacturing engine. And Amneal brings the US commercial engine with our leading retail position and channel expertise. This is a powerful combination.

Together, this combined model will allow us to advance multiple molecules at the same time. Next, smart portfolio decisions move quickly and capture more economics across the valuation. With our current and future biosimilar capacity, we are well positioned to supply a meaningful share at launch with access capacity to respond to market demand as needed. In addition, the combined pipeline of over 20 biosimilar programs supports a meaningful number of new launches over time. We are very excited about upcoming biosimilar opportunities for ZOLAR, Porensia, Simzia, and Antplate, which are attractive molecules with significant market potential and relatively limited competition.

We believe each has the potential to become a meaningful growth driver. Longer term, the pipeline extends well into the 2030s, providing substantial runway for growth.

Hard, turning to our 41-medicine pipeline, we are in the midst of the most concentrated and impactful wave of high-value new launches in our company's history. Importantly, it is not just the number of launches that matters, it is the value, complexity, and durability of these products. This momentum is the result of choices we made many years ago. We deliberately prioritized complex analytics and differentiated dosage forms, including injectables, assignments, inhalation products, drug device combinations, 5.5-2 opportunities, and other non-coral solid dosage forms, where technical complexity and execution create long-term deliver value.

Our recent approvals and upcoming launches show the strategies working. This includes the recent approval of Rumi Dapsing in oncology, additional strengths or presentation of IOHAC soil, and ready-to-use sodium bicarbonate, our latest 5.5-2 injectables, along with potential approval of land reo-tight in Q3. Each product reflects the high-impact opportunities that we have been building towards and demonstrate the strength of our affordable medicine's pipeline.

And the wheel of innovation continues to turn with another 12 to 15 high-value complex A&D filings planned this year, including two more meter-dose inhalation products. These opportunities exemplify amni score strength, strong identity, complex manufacturing, deep customer relationships, and the track record of reliable supply. We are using the same playbook that builds our affordable medicine business and applying it to biosimilars.

In specialty, we are pleased with the continued strong performance of CRACSON and BRICIA. This successful product launches reflect our ability to develop new medicines, build brands, and bring forward therapies that improve patient care.

For CRACSON, the real world evidence for parking since patient is very compelling. We recently shared data from our first phase four open-level study that showed patients converting to CRACSON had three or more hours of good on-time per day versus writery and other valuable local therapies. And a meaningful improvement in system in symptom control. In Q4, we are starting a new phase four study looking at the impact of CRACSON on treatment nine patients recently diagnosed with PLE and disease progression.

More broadly, we are building on this specialty foundation with additional R&D pipeline opportunities. While CRACSON and BRICIA are key growth drivers today, they represent the beginning of a broader specialty pipeline that we are advancing and we look to share more in the future. Taken together, we are well positioned for continued growth and remain laser focused on executing across our key operational commercial and pipeline opportunities.

I will now hand it over to Tassos.

Thank you, Chunthi, and good morning, everyone. The second quarter played out as expected with revenue growth accelerating and growth-based momentum building across our business. Consequently, we are very pleased with our continued strong financial performance and ability to raise our 2026 outlook at this quarter, reflecting the strength and diversification of our business and number of key growth drivers and the success of the business model we have strategically built over several years.

We expect this momentum to continue through the balance of 2026 and into 2027 and beyond. For the second quarter, total net revenue was 796 million, up 10% adjusted EBITDA, was 206 million, up 12% and adjusted EPS was 30 cents, up 20%. Our results were driven by strong execution across our three business segments, favorable product mix and operating expense discipline.

For the second quarter, affordable medicines delivered revenue 490 million, up 13%, reflected the strength of our growth-based complex portfolio, including our women's health products, injectables, and higher naloxone cells. In addition, new product launches added 45 million to second quarter revenue growth, including two recently last products, one in ophthalmology and one in urology. Our specialty revenue was 149 million, up 17%, driven by continued momentum in correction, unit throwing in brachia, all ahead of expectations.

Moving on to outcare, where second quarter revenue was 157 million, down 4%, similar to the first quarter, as growth in the government's channel was offset by the low margin distribution business, as we expected. As we have served in the past, we remain focused on the unique value we provide in the government's channel and continue to expand outcare's profitability.

Moving down the PML, our second quarter adjusted growth margin was strong at 46.2%, up 60 basis points year over year, reflecting favorable mix and continued operating efficiencies. Adjusted EBITDA, grew 12%, due to strong revenue growth, gross managing expansion and disciplined expense management.

From an adjusted EBITDA perspective, the second quarter grew 20%, reflecting the adjusted EBITDA growth and lower interest expense. Let me take a moment to acknowledge the strength of our first half financial performance, with total revenue is up 7%, adjusted EBITDA up 16%, and adjusted EBITDA growth of 27%. Furthermore, I'm pleased to report that we recently reprised our 2.4 billion, term loan B, due in 2032, and reduced our interest expense by 50 basis points, which equated to $12 million in annual interest expense savings.

Given the strength of our business, we're very pleased to raise our full year 2026 guidance against this quarter. We're increasing our revenue outlook by 50 million to 3.1 billion to 3.2 billion, with high single digit growth expected in both specialty and affordable medicines.

Also, we're raising our adjusted EBITDA guidance by 10 million, between 750 and 780 million, reflecting strong revenues and higher cross margin. These guidance includes an estimated 20 million dollars of negative impact, anticipated as a result of the recent flood in our EBITDA facility, as Jim mentioned earlier on, from an EPS perspective, for increasing our guidance by any, between 96 cents and a dollar or six, due to our higher profitability and lower interest expense, following our most recent successful debt repricing.

From a CAPEX perspective, for increasing our expectations from about 110 million to about 150 million, to capitalize on multiple near-term opportunities that we see in the marketplace, such as greater market demand for women's health products, and injectable expansion in the US.

Finally, we're maintaining our operating cash flow guidance. Turning to CASI for a second, we're entering the transaction from a position of strength, supported by diverse set of growth drivers, strong cash flow and discipline balance sheet management.

This progress was further validated in the April, when we received the one-not credit rating upgrade, and our most recent successful term load be repricing.

As we have outlined, a sector's action is compelling both strategically and financially. First, the acquisition enables us to be a leader in the multi-billion dollar global by a similar market that is growing rapidly.

Second, we expect to capture 400 to 500 million in financial benefits driven by tax and local incentives, as well as eliminating milestone and profit-sharing obligations.

Third, we see a clear path to the leveraging with net leverage below three times by 2028. We expect the cash flow transaction to close over the next few weeks, and in circle, they're both tomorrow and satisfaction of closing conditions. Without a return of the call back to Iraq.

Thank you, Tossos. Our Q2 results demonstrate the strength of amnials diversified business and the momentum across our growth platforms. We're delivering strong performance today with more significant opportunities ahead than any point in our company's history. The pending cashy requisition is a national extension over a strategy that will create a fully integrated global by a similar platform, provide us access to a very large market opportunity and establish a major new long-term growth.

We're excited about the future and the substantial value creation ahead. Our goal remains clear to become America's number one affordable medicines company and a leading global provider of essential medicines because innovation only matters when it reaches the patient.

Great. Good morning, Glenn. So landria tide is on its way. That's what we, we, we feel as of today, it has official gold in Q3. So that we have included some of the forecast number, but not probably the market. Very conservative. A conservative and Zolaire is towards very late end of the year or could spell into the January 5th. So nothing is included for Zolaire for this year.

And in Kashi biosciences, this is the, or your question on the six commercial biosimilars, as you know, we market the lenses. Ralupko, Philnaetra, we are launching Prolia and Xiva and look forward to launch Zolaire sometimes next year, hopefully very early. So that becomes six biosimilars commercialized by next year and more to follow that on. In 27, 28, 29. Very exciting, blood type life. Thank you.

Good morning. As you know, I'm Neil has a very vast manufacturing network in the United States. We always look and also explaining the capacity in the United States in Storile and Pat's as well.

As far as the recent announcement, we look forward for more information and would collaborate with administration as we move forward. Your second question on correct song. We're seeing 80% of the scripts coming from general, neuro, which was in the case for right and that continues to happen as you know, 80% of the prescription are written by the general neurologist. So very exciting. The phase four data is exciting as well. Well received and the script trend is keep going up every week. And it's truly needed therapy for the Parkinson's patient and our goal will be to make that a first line therapy replace the immediate release product.

Thanks.

Yeah, I do it very good morning. So IOHEC saw is a very complex product and it requires, you know, very good supply chain control and a manufacturing footprint. We are very excited with the new SKUs that are getting approved. We are expecting other one or two more strengths to get approved by end of the year. So I think going into next year will complete the entire basket because it has multiple strengths.

Same times we have increased our capacity this year and we look forward to capitalize on the full market potential next year. From quantification perspective, we think these are the 50 plus million dollar opportunity, maybe more going forward and we have secured a very good supply chain.

Regarding land rear tide, it's the same thing. It's a very complex manufacturing. As you know, it's a drug device combination. It's a peptide, it's a very unique formulation. So it has a lot of multiple barriers of entry from coming into the market. We have dedicated site and facility. We have controlling our in-house supply chain. So we are very positive and optimistic on staying market leader upon the launch in the Q3 as anticipated.

So land your tide and we have inventory to go.

We have perfected the manufacturing. So we look forward to land your tide launching Q3 of this year. Great, and I'll take the second one on a specialty M&A potential as we have stated before. Companies focus and goal will turn to the specialty side going from next year and many years to come after that. We have a full mass and great infrastructure for small molecule and large molecule with the print pending cashy requisition. So we'll keep investing in internal growths, R&D and CapEx for affordable medicines and not take our eyes off. It's a great business.

Even the existing business is growing remarkably with the new pipeline launches, the women's health, with the lidocaine expansion, with the injectable expansion in the United States. And we could not even supply more. So that is just a very positive sign and as you know, David, that would be positive because the 90% scripts are written using genetics product and always the complex products are running shortages and we are there to support that. So we're excited about that. And biosimilars, we have enough and we will keep expanding with CapEx.

Now with excess cash and other means, we would be focusing on CNS assets. So a team's looking at it and we are also looking at oncology assets. We'll be adding pipeline internally and externally and we'll share with you when we are ready.

So hi, Ash, good morning. On a Lendria type, the first one, we responded to all the queries of FDA where FDA is very comprehensive response. We are very optimistic as we haven't had any negative feedback from FDA. So we believe no news is a good news. It is under priority review. As FDA understand, it's a unmet need. So we remain very, very optimistic about 3Q launch and we have inventory to go up on the role of the product immediately.

On IOHECSOL, our strategy was to get all the SKUs together. So our R&D has completed all the work and it's not necessary to have all the SKUs but I think we do a strategic position so that we can get a bigger buy that the market share and also we are expanding the capacity. So in 26 IOHECSOL does not have meaningful revenue but in 27 onward, it will add substantial revenue growth. Right.

Thank you.

Good morning, guys. Thanks and congrats on the strong quarter. Maybe stepping back a bit in its shiragit and kicked off the call highlighting how Amule is in the most transformative period in the company's history. I think two big things that come to mind here is obviously the recent Biosimilars integration and also the Pfizer-Glyph I partnership. And I know you discussed that the Biosimilar side a bit already but maybe just walk us through what you're most focused on with respect to both of these programs over the next six to 12 months.

And then what would you maybe highlight beyond these programs that you're most excited about that you think we should start paying attention into.

And then just on the affordable medicine side, you guys have highlighted Smith can pick up in demand for estrogen patches post the recent black box removal for those types of products. Maybe just walk us through how large is that market potential there and how much is Amule position to capture? Thank you.

Great, I'll start with a photo of medicines, the existing business as I said, we're the most excited since last seven years. We used to be used to have these kinds of excitement in from 2010 to 2018. And those times have come back existing the two users, existing products, huge demand for the patches, estrogen patches and we make them right here in New Jersey. And expansion is underway 24 by seven where teams are working, we were fortunate to work with the equipment supplier to bring them bring the equipment earlier.

And we look to triple the capacity by next year. So it's a huge addition in revenue. Also we're explaining lidocaine that is also in shortage. So that demand is growing up as well, the patches, I mean, sorry, the lidocaine patches. So with patches, with off-thall mix in high demand, with even the regular products being in a high demand and new product launches affordable medicines, could add it's bigger range, but could add one to $2 billion of new revenue from now to 2030.

So that we were very excited with our existing pipeline, new product launches and in line products. So amazing times coming up in affordable medicines category. By as soon as we have spoken enough, a huge growth opportunity.

Now let's especially tax ons, keep expanding, breaky eyes, breaking the records and a unit or a steady ID growth. So we expect these three brands to continue to grow on top of it, organic pipeline would be revealed within probably in first quarter next year. And we will also look to be active in potential partnership acquisitions over branded products that fits our commercial infrastructure and fits over the category we're playing and we'll keep expanding and we may add oncology assets as well since we have the biostimilar oncology team already, a more market in knowledge over the last three years.

So that's very exciting use on specialty and we look to share that as we have that information. On Glip 1 peptides, the results are good on clinical trials and our partnerships moving extremely well. We look to expand the partnership and our both plans are coming up as fast as they can and should be operational in 2029 and 30 and we look to start supplying in 2030. And also we have evaluated the markets that we are, we have given the exclusive commercial rights like India and Egypt and those are looking good as well. So very excited on a Glip 1 peptide opportunity and also with this large infrastructure, it opens up for additional manufacturing of peptides as well as finished products for either other branded companies or in the future sub-genetic products.

On a biostimilar manner, I just want to add in the next six, 12 months, we are very much focused on integrating calcium and also advancing our pipeline on a bed as well and plate and SIMSIA. Our goal is to because iron is going to be key and that sort of avenue is always shining. So we work with calcium and enhance our ND capabilities where we can file three or four bios simulators a year which is potentially possible and new into biologics, we are also looking into different platforms within the biologics and look at some new drug device combination within the biologics to come out with kind of a 5B to a biosimilar. So we are just focused on biosimilar that plenty of products to go, advancing our pipeline and infrastructure and some of the 5B2s within the biosting industry.

Great, thank you so much. Yeah, I think we answered. Thank you, Mike.

I will now turn the call back to co-CEO Sherrod Patel for closing remarks. Well, thank you very much, everybody, and have a great first thank, take care.