ANI Pharmaceuticals (ANIP)

[Just the facts maam]

I agree but I think we are store coming years of excitement. ANIP's revenue and profit margins are due to increase at an accelerated pace.

ANIP currently has a profit margin of 6.56 % on 517.46 million (TTM). I figure it will closer to a profit margin of 22.33% on revenue over $950 million by 2028 increasing to a profit margin of 27% on revenue $1.13 billion by 2031. None of this includes royalties from CG Oncology or any revenue related to Libigel.

It has taken a while but the long awaited run looks imminent.

JMHO

[silvr_surfr]

Excellent JTFM. The coming year should be exciting.

[Just the facts maam]

With all the focus of discussion surrounding the CG Oncology litigation. I overlooked the following in ANIP Q1 10-Q filing.

Research and development expenses increased from $5.9 million to $10.5 million, an increase of $4.6 million or 77.4%, primarily due to expenses related to a FDA filing fee for a 505(b)(2) for one product of approximately $2.0 million, and a higher level of activity associated with ongoing and new projects in the three months ended March 31, 2024.

No mention of it whatsoever in the press release or the in the earnings related conference call.

It is likely for the first FDA approved Oral Liquid Composition Of Terazosin, which is the first patent Novitium received and is patent protected to February 1, 2041.

Maybe ANIP is waiting for confirmation of FDA acceptance of the application before announcing it, which they should have by now.

If all goes well, it should be approved in 2024 Q4 or 2025 Q1.

Obviously, this not calculated into ANIP's current PPS.

[Just the facts maam]

I believe the $105 million revenue guidance from Alimera may be low.

According to their ]earnings CC in May

We continue to see growing utilization in the U.K., Portugal, Ireland, Spain and France. In March, the U.K. National Institute for Health and Care Excellence, or NICE, issued final guidance stating that the fluocinolone intravitreal implant is recommended for treating visual impairment caused by chronic diabetic macular edema irrespective of lens sight.

What this means for us is that now faking patients or those that have a natural lens now have access to ILUVIEN. NICE reimbursement to-date has been limited to only pseudophakic patients or those that had undergone cataract surgery. This is a significant expansion of our potential user base among the chronic diabetic macular edema or DME patient population. According to the U.K. Macular Society, safety patients represent up to 75% of the broader DME population in the United Kingdom. We expect the availability of this wider reimbursement to positively impact utilization in the U.K. in the second-half of 2024.

NICE guidance can also impact reimbursement in other countries such as Spain and Italy. We believe that this NICE decision if adopted in other markets will broaden our potential patient base in these countries as well.

.

The CEO was reluctant to provide analyst with guidance on sales increases due to the NICE reimbursement update, stating that they would need a couple of quarters to gauge the uptake.

It explains the head count expansion in the UK.

I also liked the following from the CC

For YUTIQ, our sales team now have the three year data from the YUTIQ PIVOTAL 001 study that illustrates the benefit of long-term control for chronic non-infectious uveitis affecting the posterior segment of the eye. It shows that the median time to the first recurrence of uveitis is over 1,000 days for the YUTIQ patient, while it's less than 100 days for the same patient, a substantial benefit

Longer term I like that they are collaborating on a trial titled

Intravitreal Faricimab Injections or Fluocinolone Acetonide (0.19 mg) Intravitreal Implants vs Observation for Prevention of VA Loss Due to Radiation Retinopathy (AL)

A phase 3 trial where Genentech is also collaborating. Primary Completion date is 2026-11-26 with study completion date two years later.

The study plans to include 600 patients with primary choroidal melanoma seeing in treatment with plaque brachytherapy. Over 40% of radiation retinopathy patients have been shown to experience the devastating vision loss associated with radiation retinol within three years of treatment. And currently, there are no FDA approved pharmacotherapies for radiation retinopathy.

[Just the facts maam]

Esaka, I believe they are lawyers from the state. They are acting on behalf of the big guns who will guide the legal stategy. Lead lawyer for ANIP appears to be James W. Dabney who is a retired retired Hughes Hubbard & Reed partner who is now an adjunct professor at Cornell Law.

Biography

James W. Dabney formerly headed the intellectual property and technology practice of, and is a retired partner in, Hughes Hubbard & Reed LLP. His litigation experiences include jury trials, administrative proceedings, arbitrations, appeals, and four successful Supreme Court appearances including TC Heartland LLC v. Kraft Foods Group Brands LLC, 581 U.S. 258 (2017) and KSR International Co. v. Teleflex Inc., 550 U.S 398 (2007). He is the author of KSR: It Was Not a Ghost, 24 Santa Clara Computer & High Tech. L.J. 131 (2007), and is also the sole named inventor of U.S. Patent No. 7,653,591 B1 entitled "Late Fee Avoidance System."

Mr. Dabney is a Life Member of the American Law Institute. He has lectured on patent law to professional audiences throughout the United States and in Europe and Asia, including at the European Patent Office and the Korean Intellectual Property Office.

His Biography

I like the fact that he has successfully argued before the Supreme Court on four cases. I believe that this case might end up there, as well, in order to protect biopharma inventors where 20 year patent of protection is often insufficient considering the time it takes to get a drug approved.

CG Oncology lead lawyer is likely David J. Farber a Partner with FDA and Life Sciences at King & Spalding

David J Farber

[Easka]

Silvr, Thanks for the post. I am not a lawyer, but one thing seems Very odd to me; the lawyers for both the plaintiff, Michael J Farnan and the defendant, Kelly E Farnan have the same last name? Both for from law firms from Wilmington DE.

[silvr_surfr]

Thanks JTFM. That is what I was thinking too but was not sure. It sure looks like they are vigorously defending the agreement. I like that they brought in SImes who actually structured the deal and that they are subpoenaing the people who helped put the IPO together. I t sure seems like they should have called this out in the transaction. Maybe they did which is what we will see in discovery.

[Just the facts maam]

I see ALIM is expanding their head count by 20 in the UK and Ireland and by 10 in Germany. A head count increase of almost 20%.

ALIM Jobs

[Just the facts maam]

Thanks Silvr, looks like CG Oncology is really trying to avoid discovery and withholding requested documents. It will be interesting to see how CG Oncology and ANIP update their shareholders.

[silvr_surfr]

Sorry it was Morgan Stanley not Merrill Lynch.

[silvr_surfr]

Hi, any attorneys out there who can decipher what's happening in the CG Oncology lawsuit? Here's is what I am able to discern, but there are many motions and service items that I cannot:

- CG Oncology lost their motion to stay discovery
- Stephen Simes submitted an affidavit on our behalf
- We subpoenaed Goldman Sachs and Merril Lynch who were both a part of the CG Oncology IPO

CG0070 Lawsuit

[big bambino]

Happy INDEPENDENCE DAY, one and all. Seems we may be getting it back, lol

[Just the facts maam]

Silvr and Bagel, I remember the market manipulators holding ANIP's PPS in the mid $20's when they let it go it ran up to mid $70s. I expect a similar run eventually, taking us to between $150 and $180, a price where they may be willing to retail investors back in the game.

[silvr_surfr]

The growth and prospects should truly command a higher share price. I don't fully understand all of the tactics of manipulation. Dark pools are especially troublesome where it appears transactions can be parked for later use. This completely destroys the supply/demand thesis. I have read how the algorithms play on the emotions of retail. That is how it feels right now where the price can never seem to break $70. The algorithms are designed to get people to capitulate.

I don't have data, but it always seems like the share price is attacked prior to earnings to accumulate shares. I will look at this to see if there is not a trading strategy that could be deployed.

[Just the facts maam]

ANIP share price is treated better than many pharma companies but worse than others and the ALIM deal has yet to close. With such a low share total PPS can be moved up and down rather easily. One problem is that it is still lightly covered. A lot of outdated investment information on ANIP is out there with no reference to their focus on rare disease. With only 33.33 million shares authorized, I believe they don't want heavy coverage, yet. Lack of liquidity could force them to issue shares prematurely. ANIP's MO is to under promise and overdeliver. I don't expect this to change. Once profits exceed what they need for business development, one way to counter the market manipulation is by returning shareholder value in the form of a dividend. It has no bearing on share price and takes the ball out of the hands of market manipulators. Though ANIP's Annual report indicates they do not intend to issue dividends for the foreseeable future. This is especially true, if they intend to expand globally.

ANIP has proven prudent in its acquisitions. Gilead paid 6.6 times peak sales for Cyma Bay and Abbvie paid 5 times peak sales for ImmunoGen. In fairness both companies have longer IP protection. In S&P 's analysis they believe peak sales of $200 million for ALIM's Iluvien an Yutiq, though a number of analyst believe it to be higher. S&P believe that they unlikely to face generic competition due to cost of trials and complexities in developing and manufacturing these drugs, which is almost as good as IP protection. The $381 million deal at 1.9 times peak sales seem like a bargain. Additionally, S&P upgraded ANIP to BB following the deal. This should reduce the cost of borrowing somewhat.

S&P Global ANIP/ALIM deal

The Corti and Novitium deals show that ANIP is good at generating value through their business development, I am certain the ALIM deal will be just as good for ANIP.

As always, we are the mercy of the market manipulators, for the time being.

JMHO

[bagel123]

why is this stock not at 85 by now????

[Just the facts maam]

Thanks BB.

[Just the facts maam]

They launched it today as well. U.S. annual sales for Naproxen Delayed-Release Tablets total approximately $36.7 million, based on April 2024 moving annual total (MAT) IQVIA data.

PR from ANIP sight

[big bambino]

North, nothing else on this at Merrill. Caught my eye because I take Naproxen, lol.

[north40000]

Interesting…..any idea how soon ANIP will market that generic?

[big bambino]

08:09 AM EDT, 07/02/2024-- ANI Pharmaceuticals said Tuesday that the US Food and Drug Administration has approved its abbreviated new drug application for its Naproxen delayed-release tablets, a generic version of EC-Naprosyn. Naproxen is a nonsteroidal anti-inflammatory drug used to treat pain or inflammation. US annual sales for Naproxen...

[Just the facts maam]

I believe so, Silvr.

I checked out the authorized shares for US Pharmas with a market cap exceeding $1 billion.

ANIP had the lowest at 33.33 million shares followed by :

LGND had 60 million shares
PTGX had 90 million shares

The rest had authorized 100 million shares or more.

As it stands ANIP will not be splitting their stock as it gets more expensive.
It is unlikely that they will use equity in any future deal unless the share price climbs considerably.
Another reverse split could be used down the road to free shares for a deal. This would make ANIP shares even pricier and out of reach for most retail investors.
If ALIM deal generates returns as expected and the CGON and Libigel royalties kick in, I expect they will be flush with cash and will not require much in the way of equity financing to fund growth.

Personnally, I hope the goal is not to sell ANIP, but to create a company that eventually pays high dividends.

[silvr_surfr]

Wouldn't tthis be one of the reasons why MVP Capital has stuck with the company for so long too?

[Just the facts maam]

Just noticed that when Biosante led by Simes did their reverse split in June of 2012. They took down the authorized shares from 200 million to 33.33 million, as well. Very odd for a company trying to survive. This is very small for the pharma industry. Often the reverse split only applies to the outstanding shares. When the reverse split on 2013 occurred after the merger with ANI, only the outstanding shares were affected. As of Q1 release over 64% of the authorized shares have been issued.

Even though ANIP is an acquisition company, it looks like the merger between ANIP and Biosante was forged with the intent of it being sold and by keeping a low share volume, it is easier to maintain a controlling interest.

Any increase in authorized shares requires shareholder approval. No one will authorize this unless there a deal on the table that is compelling to investors.

If Anip is not being bought out within the next 3 to 5 years, I see ANIP using cash to buy back shares to be used for larger deals in the future.

JMHO

[Just the facts maam]

How Ampersand fits in is a good question. Their portfolio is broad and many could help ANIP at some point.

[silvr_surfr]

Excellent thesis JTFM. You have to like the entrepreneurial spirit of the team. We have not talked about our chairman, Patrick Walsh, and the Ampersand Capital connection of late. Where does this fit in with all of the other catalysts?

[Just the facts maam]

For anyone concerned about Samy selling shares for Esjay Pharma LLC, Esjay Phrama LLC operates out of Novitiums location in East New Jersey. NOVITIUM LABS PRIVATE LIMITED had two directors listed Samy and Ayyavu Rajavel. Rajavel is also a director for Esjay Pharma Private Ltd headquartered in India. Esjay Pharma Private Ltd. manufactures injectable.

Esjay Pharma Private Ltd

Esjay Pharma Private Ltd was incorporated September 30, 2022 and Samy (Esjay) started selling shares June 20, 2023.

Esjay Pharma Pvt Ltd Manufacturing

I believe that SAMY is setting up Injectable manufacturing capabilities at the Novitium location for Corti, Iluvien and Yutiq and future products.

[Just the facts maam]

Thanks North. Never ceases to amaze me at how many ways exist to manipulate the markets.

[Just the facts maam]

If I am reading this correctly there was bit of a tell in the Alimera presentation that ANIP existing pipeline is on track for a significant increase in guidance.

Potential for substantial shareholder value creation
? Expected high single-digit to low double-digit accretion in 2025 adjusted non-GAAP EPS and substantially accretive thereafter
? Anticipated additional $35-$38 million in 2025 adjusted non-GAAP EBITDA inclusive of approximately $10 million in identified
cost synergies; incremental EBITDA contribution expected from accelerated growth of Cortrophin Gel within ophthalmology
? Anticipated 3.2x(1) pro-forma leverage upon close; expect to significantly de-lever organically in 2025

ANIP's Net Debt stood a $47.21 million in Q1. Tthe deal cost $381 million, $280 in debt financing and the rest coming ANIP's cash.

Since the deal is closing in Q3 and at close they are looking at ANIP having a 3.2 pro-forma leverage. If ANIP did not add to their coffer in Q2 ANIP and ALIM combined EBITDA would be $40.11 million for Q2. Alimera had $9.6 million in EBITDA over the last three quarters. ANIP has a 21.72% EBITDA margin (TMM) , While ALIM has had a 7% EBITDA margin since acquiring Yutiq.

However, likely reduced their net debt somewhat lowering the combined EBITDA for the quarter. I would not be surprised if ANIP reports at least $150 million in revenue for Q2.

JMHO

[silvr_surfr]

We've come a long way from 50% of sales coming from EEMT and waiting on Libigel to come to fruition. Should be an interesting year.

[north40000]

Has anybody seen a sign of Zero-Dated Options being used by short sellers, day traders or market makers to “control” ANIP share price? See the 7/01/2024 Barron’s La Monica article at pages 18-19. Bets on market moves. Wide spreads between Bid and Ask prices at various times of day. Sharp intraday moves ahead of earnings reports. Major exchanges have not approved them yet for individual stocks, but who knows what goes on at the numerous minor exchanges that are appearing. OCC is the gatekeeper, with SEC as the regulator.

Zero days to expiration = 0DTE. Cboe uses them. Some foreign exchanges also.

[Just the facts maam]

I agree regarding institution manipulation. Hopefully, you are right regarding the Chevron decision.

Upon looking at pharma companies trading higher than ANIP only six are currently profitable that will be making more than the $20 EPS ANIP will be generating by 2031. This assumed analyst projections for Alimera are correct and ANIP wins the CGON royalty litigation and Goldman Sach is correct about the $2.5 billion in sales.

There a few other pharmaceutical companies estimated to have greater than $20 EPS by 2031, but they will continue to lose money and could require more dilution as they work towards NDA submission.

The one with the lowest EPS estimate above $20 by 2031 for a currently profitable company is Biogen (BIIB) with an EPS estimate of $24.78 for 2031 and an EPS estimate of $15.62 for 2024. BIIB currently trades at $231.82. I figure as more analyst cover ANIP and the company keeps meeting or exceeding estimates ANIP will close the gap in PPS substantially.

Lord knows where it will go if Libigel kicks in.

[silvr_surfr]

Still a lot of volume on Friday. I would have thought if they had to buy a bunch of shares, then the price would go up, Nope, so it does look like manipulation the last week to get a better price and possibly accumulation by other players. The retail investor can't compete.

Perhaps yesterday's Chevron Supreme Court decision will get thIngs back on track and stopping the SEC from creating rules that favor their buddies.

[Just the facts maam]

Thanks Silvr, your right, according to Russell the newly reconstituted indexes will take effect after the market close on 28 June 2024. it will be interesting when PPS breaks through resistance.

[silvr_surfr]

Thanks JTFM. Wasn't some of this from the Russell re-balancing? Our share count increased this year which, together with a share price increase, resulted in about a 2X increase in market cap from April 2023 to April 2024 when, I believe, the snapshot is taken.

ANIP Market Capitalization Chart

Regardless, I agree we should see the price rebound as we get nearer to earnings. There is quite the resistance around $70, so it will be interesting to see what happens when we break this.

[Just the facts maam]

Looking at Q1 Corti vs Acthar sales. The combined sales grew by over $41.4 million over Q1 2023 with ANIP capturing approx. 50% of the revenue growth. Seeing that Corti sells for approximately $10,000 less. ANIP is obviously capturing more than 50% of the new prescriptions. This bodes well for ANIP as Nikhil believes the ACTH therapy market is headed back to over $1.2 billion.

[Just the facts maam]

Nasdaq's chart shows that 879,898 shares were traded at close and 136,961 shares after hours. Obviously the price was drawn down this week to execute this accumulation. Back to climbing next week.

[Just the facts maam]

Easka, the $16.59 EPS estimate is based on only one analyst for each company. That being said in 2028 three analyst estimated that ANIP's EPS would be $7.33 with a high of $8.51 and a low of $6.11. In 2029 the sole estimate is for $6.87. Seems to me that the only analyst estimating beyond 2028 was the low ball estimate. In 2027 the low estimate was approx. 35% lower than the average of the others and 30% lower than the average of the others in 2028.

Once other analyst chime in long-term ANIP could be receiving EPS average EPS estimates of approx. $20 for 2031 assuming no further dilution other than what is already factored in current estimates for both companies.

Note: This does EPS increases from any of the following catalysts.

ANIP announced record new starts in both patients and prescribers Cortrophin Gel sales in April and May, therefore I expect an increase in guidance for 2024 in August when earnings are released and un upward revision in EPS estimates.

Movement of female testosterone, by any company that might be utilizing the Libigel data.

Part of the Novitium deal included Profit-based milestone payments for three 505(b)(2) NDAs which ANIP expect to start paying in 2025. This could mean a launch as early as Q4 of 2024. Novitium has secured three patents extending to 2040 and beyond, so it may be related the following: Stable Oral Liquid Composition Of Terazosin, Hydrochlorothiazide Compositions and a tablet for oral suspension comprising Carglumic Acid. They also have a strong connection to Nuray Chemicals through Samy Shanmugam which has a number of patents, most interesting is the one regrading Tafamidis (Pfizer's Vyndaquel family of drugs) where Samy is listed as the lead inventor.

EPS estimates will be increased once of each of the above drugs are provided.

The CGON royalties litigation in ANIP's favor would pump EPS estimates as well.

ANIP also intends global expansion by using Alimera's footprint as a starting point.

JMHO.
I imagine as the deal is finalized it will be more difficult for retail investors to pick up shares.

[Just the facts maam]

Opened in error

[Just the facts maam]

HC Wainwright raised Price Target for ANIP to $94.

PT $94

[Just the facts maam]

I agree Silvr, many catalysts on the way. ANIP's PPS had lower day end closes from June 7th to the day before the announcement of the acquisition. While Alimera went from 98,200 shares traded on June 10th to 1,675,800 shares traded June 11th. Sure looks like word of the acquisition got out prior to the announcement.

Congrats to Nikhil. I believe it was for the New Jersey area hopefully he gets their national award next year.

[Easka]

Thanks for the reply and feedback. Looking at the last three analysts all had Strong Buy recommendations on Alimera before Ani's buy offer.
I think you are right they made a good pick (at the right time) and a good fit with their Rare disease business. It was worth the wait.

[silvr_surfr]

Thanks JTFM. I had the same thought. Lots of catalysts for growth over the coming year. The market seems to like it as well, although it sure looks like they took it down in advance of this "news". I don't know if you saw this, but Nikhil was named "Entrepreneur of the Year" by E&Y.

[Just the facts maam]

It looks like the Alimera deal does not involve the meetings ANIP management apparently had with Truist June 13 - 16.

ANIP may just be getting started.

[Just the facts maam]

Easka, based on analyst estimates when combined ANIP's current EPS estimates for 2031 should be raised from $7.31 to 16.59 (less any further dilution).

It should add the following to ANIP's EPS (less any dilution).

2025 =$0.70
2026 = $1.18
2027 = $2.83
2028 = $4.37
2029 = $5.69
2030 = $7.34
2031 = $9.28

[Just the facts maam]

Easka for 2028 estimates the analysts were Yi Chen of H.C. Wainrright & Co., Naz Raham of Maxim Group and James Malloy of Alliance Global

Stock Analysis- ANIP

For 2031 i got it from Seeking Alpha - the analyst is not provided.

Seeking Alpha

[Easka]

Thanks JTFM, who was the analyst that stated that and do you have link?

[Just the facts maam]

Analyst predicted Alimera on its own would generate $234 million in revenue by 2028 and $384 million in revenue for by 2031. Looks like a good pick by ANIP.

[Just the facts maam]

ANIP starts to expand sales globally with acquisition of Alimera Sciences. It is good for the reps selling Corti to ophthalmologist.

[Just the facts maam]

I noticed that since the May earnings there were three trading session with over 300,000 shares traded. The first traded as high as $70 and was dragged down to as low as $60.36 before starting its climb back up $69.09 before the next >300,000 share trading session. We are now on our 10 consecutive day of lower closings with volume on Friday was above 300,000 again. Meanwhile institutions know that ANIP set new record patient starts for both April and May. Certainly looks like controlled accumulation.

When they are done accumulating we should see it climb back to $70ish range and blow by the $81.60 target price (maybe closer to $87 for the only target price that was issued after May's Corti sales information.



JMHO

Just my opinion.