Thank you, operator, and good morning, everyone. Joining me today is Scott Langille, Cipher’s CFO.

On today’s call, I will make opening remarks before passing the call over to Scott to review the financial results in detail. Following our prepared remarks, we will open the call for your questions.

Note that all amounts are in U.S. dollars unless otherwise stated.

Our second quarter results demonstrated strong sequential and year-over-year growth in revenue, EBITDA and earnings per share driven by growth in our license and product portfolios. In addition, we generated $7.6 million in cash from operating activities in the six months ending June 30, 2021.

Ending the quarter with a strong balance sheet and placing us in an excellent financial position as we continue to assess growth opportunities and maximize income generated from our distribution agreements. During the second quarter we launched Absorica AG with our marketing partner Sun Pharmaceutical Industries.

We believe that this will broaden Cipher's isotretinoin portfolio and ensure we have products to serve each segment of this market and maximize the value of this portfolio. The U.S.

isotretinoin prescription market increased by 18.2% in the six-month period ended June 30, 2021, which helped drive growth in our licensing revenue during the second quarter, as we were first to market with an authorized generic version of Absorica. Although it is still early, it is our belief that the lower price generic may have driven an expansion of the overall market.

Currently in our isotretinoin portfolio, Cipher is receiving royalties from Sun Pharma for the branded product Absorica, the authorized generic as well as Absorica LD. We are confident that working with Sun Pharma is the right economic decision for Cipher, and is consistent with our overall strategy to maximize the value of the isotretinoin portfolio.

Absorica was a key contributor to our strong second quarter revenue growth. I'm pleased to report that our licensing revenue from Absorica was $2.4 million in the second quarter, an increase of 25%, compared to $1.9 million for the comparative period.

Market share for Absorica and the authorized generic version of the Absorica for the three months ended June 30, 2020 was approximately 4.2%, compared to 6.5% for the three months ended June 30, 2020. Market share including Sun's Absorica LD was approximately 6.2%.

In addition to Absorica, product revenue for the Epuris grew 63% to $3.1 million, compared to $1.9 million in the comparative period. According to IQVIA, Epuris had prescription market share of 43% and Canada for the three months ended June 30, 2021, compared to 41% last year.

We are extremely pleased with the performance of the Epuris and the stability of revenue and cash flow during this challenging period. During the second quarter, we drove 10.3% increase in SG&A, and we generated 67% adjusted EBITDA margins.

Earnings for the second quarter were $0.11 per share an increase of 450% over the comparable period. In March, the company received approval from the Toronto Stock Exchange to amend its normal course issuer bid in order to enter into an automatic repurchase plan with this designated broker.

Cipher believes that from time-to-time the common shares trade in price ranges that do not fully reflect their value. In such circumstances, the company believes that acquiring common shares for cancellation may represent an attractive and desirable use of their available funds.

During the six-month period ending June 30, 2021, the company repurchased for cancellation 527,500 shares at an average price of $1.30 for cancellation. Cipher has assembled an attractive portfolio of assets beyond our currently marketed products.

Now we continue to move these products towards commercialization. We're advancing our tattoo program, our product development with Moberg, and our products that we have in development with Galephar.

With our pristine balance sheet, Cipher is now in an excellent position to continue to execute on the normal course issuer bid, and to selectively pursue product and business acquisitions in a prudent manner with a focus on the high growth potential and near-term profitability. I will now turn the call over to Scott for financial review of our quarterly results.

Scott?

Thanks, Greg. Revenue in the first quarter was $6.1 million, compared to $4.7 million for the comparative period.

Licensing revenue increased $2.8 million for the quarter, compared to $2.7 million for the same period last year. Licensing revenue from Absorica in the U.S.

was $2.4 million for the three months ended June 30, 2021, compared to $1.9 million in Q2 2020. Licensing revenue from Lipofen and the authorized generic version of Lipofen was $0.4 million for Q2 2021, and compared to a decrease of $2.2 million compared to revenue in $0.6 million for Q2 2020.

Licensing revenue for extended release Tramadol, which is Conzip and Durela was $0.05 million, a decrease of $0.2 million, compared to 2.5 million for the three months ended June 30, 2020. Product revenue increased by $1.3 million or 65% to $3.3 million for Q2 2021, compared to $2 million for the comparable period in 2020.

The increase in product revenue was attributable to Epuris in respect of revenue increased to $3.1 million, compared to $1.9 million in the comparative period. According to IQVIA, Epuris setup prescription market share of 43% in Canada for the three months ended June 30, 2021, compared to 41% for the three months ended June 30, 2020.

Product revenue for Ozanex, Beteflam, Actikerall, Brinavess, Aggrastat and Vaniqa was $0.2 million in aggregate, compared to $0.1 million for comparative period. The operating expenses increased to $2.3 million for the quarter, compared to $2.1 million for Q2 2020.

The increase in operating expenses for the second quarter is primarily due to an increase in cost of goods sold. SG&A expense was $1.2 million for the quarter, a decrease of 10% compared to the same period in prior year.

Income from continuing operations with $2.8 million or $011 per basic and diluted share in Q2 2021, compared to income from continuing operations of $0.4 million or $0.02 per basic and diluted share in Q2 2020. Adjusted EBITDA for Q2 increased by 40% to $4.1 million, compared to $2.9 million in Q2 2020.

The company has $16.1 million in cash and no debt as of June 30, 2021. The company generated $7.6 million in cash from operating activities in the six-month period ended June 30, 2021.

And the net cash increased $6.9 million during the same period. Subsequent to June 30, 2021, the company has signed the office lease for its corporate operations head office to an arms' length third party.

The term of the lease was 10 years and three months and commenced on January 01, 2019. The company expects to incur a non-reoccurring early termination expense in the three months ending September 30, 2021.

It's expected that the early termination of the lease will result in a net savings of approximately 25,000 for months. Cipher has purchased for cancellation 377,300 common shares during the quarter at an average price of $1.45.

With our strengthened balance sheet, we are in an excellent position to continue to execute our NCIB while investing in our development pipeline and selectively looking for attractive acquisitions. I will now turn the call back to Craig for closing remarks.

Thank, Scott. With a profitable business and a reduced cost structure, we feel that we are in an excellent position to start accelerating our strategic promotional efforts to drive market share in our core brands, and explore product and business acquisitions in a prudent manner.

We'll now open the call for questions. Operator?

Yes, thank you very much, and good morning, gentlemen. Congratulations on the strong financial data.

Craig just kind of piecing together a couple of data points in your financials, starting with Epuris strength in the quarter, congratulations on that. Then your commentary about the growth of the U.S.

isotretinoin market going up 18.2%. You attribute that, in part, if not entirely to, availability of Teva's lower price to generic Absorica, piecing those two data points together, I'm just wondering if you or Sun or both of you have revisited your branded of Absorica pricing strategy.

And in perhaps, revisited the price volume curves that I'm sure you put together on that product just to see if there is a different price point that might allow you to capture more Epuris like market share in the U.S. and perhaps capture more revenue as a consequence.

Yes, Doug, we worked with Sun very closely on the launch of the AG product, and pricing was a big issue. It's something that, we did some modelling around as to what type of volume changes may occur based on different price points, and we believe that the product is priced right now to maximize total income from the product.

Okay, it's fair enough.

And maybe, Doug, I'll just add a little bit, obviously, the pricing in the U.S. market is significantly different than in Canada, where Epuris is priced at a slight premium to the competitors in the market right now.

And given the extra value that the product has, and the people are prepared to pay the extra amount for that premium value.

I understood. And then the second quick question here, and it'll throw it over to others.

I mean, you did incur about $1 million in income tax expense in the quarter, and that's a little bit surprising given that you purchased a couple of years ago, all of Correvio's tax losses. Just kind of walk me forward on what how you intend to monetize all the tax laws required to that transaction and why your taxes were so high, but specifically in this area?

I'm going to ask Scott to help me through this a little bit. But there's a difference between the reporting of taxes and the cash taxes.

Yes, working closely with our auditors, it was determined that we would accrue taxes on normal basis, excluding any tax utilization from the Cardiome losses for financial statement purposes. In other words, recording for books is normal tax versions.

However, when we go to file our tax returns for the year ended, we will indeed apply that Cardiome tax losses. So there is now a difference between books and when we go to follow the taxes and that was determined working very closely with our auditor.

Got it. Good, that’s it from me guys.

Thanks.

Okay.

Thank you for joining us today. We look forward to reporting on our progress throughout the balance of 2021, as we execute on the priorities we've discussed today.

Thank you and have a great day.