Catalyst Pharmaceuticals, Inc. (NASDAQ:CPRX) Q4 2022 Earnings Call Transcript

Jeff Del Carmen: Yes, Scott. So we do anticipate the average daily dose will increase for our patients. I’ve mentioned it before, our average daily dose is about 61 milligrams right now. And we do have feedback from health care providers and patients asking for — that they feel they would benefit — the patient would benefit from — of being able to go above 80, if that was within the label. So with that, we anticipate our average daily dose to creep up over time significantly.

Scott Henry: Okay, thank you. And then FYCOMPA, I believe, $130 million in revenues in 2023 guidance. As far as trajectory, should we just kind of allocate that over 11 months or is there any trends we should expect there?

Patrick J. McEnany: Well, we’re in the process of the transition, Scott, and we expect the full integration to be completed by midyear. And so I would expect that the run rate will, by quarter, sequentially increase over the course of this year, the first year of our ownership. Remember, it’s a pretty mature product that’s been in the market for 9 to 10 years and got a very established base, and we’re looking to get the integration completed and then grow the product.

Scott Henry: Okay, thanks for that color. And then Pat, if I break out the FYCOMPA revenue from your overall guidance, you get to $245 million to $255 million, if I did my math correctly for FIRDAPSE. Q4 was $60 million, and it sounds like Q1 is better than Q4. So it seems like — I guess, the question is, would you say you’re perhaps being conservative or are you expecting more of a flattening, it sounds like it’s just being conservative?

Patrick J. McEnany: For FIRDAPSE, you’re talking about, Scott?

Scott Henry: Correct.

Patrick J. McEnany: Yes, I think that the trend will be typical as it has been. Remember, last year’s first quarter was impacted with the resolution of the 11th Circuit Court when the approval for RUZURGI pediatric indication was overturned, and a number of the RUZURGI patients during Q1 of last year transitioned to FIRDAPSE. So it’s probably going to be a difficult comparison for the first quarter. But as Jeff pointed out, we have continued to enroll new patients in Catalyst Pathways that are naive to either product, and just continuation rates are down. And we want to continue to see that. And so we think that we’re going to have a typical year quarterly sequentially up each quarter.

Scott Henry: Okay, great. And then just finally, just a couple clerical questions. First, the cash is significant. I guess, I don’t want to get into the business of predicting interest rates. But it sounds like you’re probably generating around 4% on that for the interest income line, is that a reasonable assumption? And staying on the income statement as well, as far as taxes, will you be — will you start to pay taxes at this point, that tax asset, how much more cover do you have there?

Patrick J. McEnany: Your first question, Scott, was about where we’ve invested our remaining cash, and it’s — we’ve been very conservative and typically been a 90-day T-bills. And you’re right, it’s what a difference a year makes. This time last year, we were getting about seven basis points on our investable cash. Today, I would say, our blended yield right now on our 90-day T-bills is somewhere between 4% and 5%. So it’s — you’re right, it’s going to be hard to predict going forward. But that big quarter is in a pretty good spot right now because I do believe that we’re going to generate a lot of cash this year, again, with FIRDAPSE and FYCOMPA. Ali, maybe you can address the tax issue.

Alicia Grande: Yes, regarding the tax issue, as we mentioned, our effective tax rate for 2022 was 21%. However, we fully utilized our federal net operating losses and state net operating losses. So we do expect a more normalized 23% to 25% rate in future periods.

Patrick J. McEnany: Yes. I would say that starting midyear last year, Scott, we were guiding that we anticipated a more normalized 25% tax rate going forward, and that’s going to vary according to — based on some of the state taxes that we pay and also option exercise is kind of back

Alicia Grande: Which for 2022 really better rate, but we can anticipate that will be the same for future years.

Scott Henry: Okay, great. Thank you for taking the questions.

Patrick J. McEnany: Thank you Scott.