Valeant Pharmaceuticals International, Inc. (NYSE:VRX) Q4 2017 Earnings Conference Call Transcript

Feb 28, 2018 • 08:00 am ET

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Valeant Pharmaceuticals International, Inc. (NYSE:VRX) Q4 2017 Earnings Conference Call Transcript

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Presentation
Executive
Joseph C. Papa

of course RELISTOR.

Together these seven products represent less than $100 million of revenue. We are planning to make a significant investment to market these products over the next five years. And as we look to peak sales for these products, we expect they will represent over $1 billion of annual sales on a cumulative basis. This is the focus of our turnaround, investing in innovation, getting products approved, and successfully commercializing them.

And on Slide 28, you can see an overview of our pipeline and the progress we are making in innovation from late phase to submissions to product launches. The increased investment we are making in R&D will help us to move these projects through the pipeline into the market. The fact that we have four PDUFA dates and subsequent product launches coming up in the next eight months after completing six US launches in 2017 gives you a sense of the pace and volume of activity in our late-stage pipeline, which brings us to our 2018 commitments and expected targets on Slide Number 29.

We've identified five commitments and targets that are going to be the key in helping us drive long-term shareholder returns. Each of these commitments is a continuation of the actions that we have taken successfully in 2017. First, we commit to turnaround the Ortho Dermatologics business with a goal of doubling revenue over the next five years. Second, we are targeting over $1 billion of annualized revenue from sales of the Significant Seven products over the next five years. Next, we will continue to address Company's debt using cash flows and through opportunistic capital markets transactions. We'll keep looking at how we drive operational efficiency with a goal of reducing our cost of goods by approximately $200 million, and taking approximately $100 million out of the working capital over the next five years. And finally, we commit to increase R&D spend by more than 15% in 2018.

As I said before, I joined Valeant because I believe I saw a turnaround opportunity of a lifetime. I'm pleased with the progress we made last year in turning this Company around. Our team is focused on delivering on the goals we've outlined for 2018 to lead us into the next phase of our multi-year plan.

With that, operator, let's open up the line for questions.