Medicure Inc.

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01:06 Thank you, Chris, and good morning to everybody on the call. We appreciate your interest and the time you've taken to participate in the call.

Joining me today is Chief Financial Officer, David Gurvey; and Dr. Neil Owens, President and COO.

This morning we'll be discussing the financial statements and the business for the second quarter of twenty twenty one. 01:34 COVID has provided challenges to a lot of businesses, including Medicure, despite the challenges we are pleased with the positive trend of revenue and net income over the last few quarters.

We experienced a modest but positive EBITDA for the second quarter of twenty twenty two – twenty one, a positive change from the losses that had been reported in twenty nineteen and the first half of twenty twenty. 02:02 The sales of AGGRASTAT have stabilized and we're pleased with the early stage performance of our December twenty twenty acquisition of Marley Drug.

One of the reasons we acquired Marley Drug, as mail order pharmacy was to expand our sales reach for ZYPITAMAG, and we're now exploring ways to further build on the pharmacy business. Our ongoing focus of our business is the sales and marketing of AGGRASTAT, the growing of ZYPITAMAG business with more direct marketing to patients with the help of Marley Drug, as well as continue the marketing to healthcare providers.

02:46 The revenue for the second quarter of twenty one was five million nine dollars which is up substantially from twenty twenty quarters, due mainly to the added revenue from Marley Drug and slightly from Q1 twenty one. AGGRASTAT revenue of two point eight million dollars is similar to the previous quarters as was Marley Drug at one point eight seven million dollars and ZYPITAMAG was up a bit at four hundred and three thousand.

3:15 As mentioned before, Medicure has transitioned away from the sales and marketing of ReDS device, which reduced significantly operating expenses and associated losses and well retaining the value and sensible medical. The main of focus at present is the sales and marketing of AGGRASTAT, ZYPITAMAG and further leveraging Marley Drug pharmacy.

03:41 And we are pleased with a few quarters investments in our programs and on-boarding of products will provide both growth and revenue profits for the coming quarters and years. Medicure has expanded business with a great team, energy, talent, and experience.

4:02 I'll now turn over the call to Chief Financial Officer, David Gurvey.

4:07 Thank you, Albert and good morning, everyone. A couple of quick items to note before I start.

All dollar figures are in Canadian dollars unless otherwise noted by each presenter and as a reminder, you can obtain a complete copy of our financial statements for the year ended December thirty one, twenty twenty and the quarter ended June thirty, twenty twenty one along with previous financial statements on the investor page of our website and a copy of all financial statements and management discussion and analysis can be obtained from sedar.com. 04:42 For the second quarter, revenues were five point zero nine million dollars an increase of one hundred and fifty thousand dollars from the previous quarter and two point six seven million dollars from the comparable quarter in twenty twenty.

The increase in revenues between the two years was primarily a result of the Marley Drug acquisition. AGGRASTAT revenues were two point seven nine million consistent with the prior quarter and slightly higher than the comparable period in twenty twenty.

05:09 ZYPITAMAG revenues increased to four hundred and three thousand dollars for the second quarter, an increase of one hundred and sixty one thousand from the prior quarter, and up from one hundred and three thousand dollars in the second quarter of twenty twenty. The increase in revenues in ZYPITAMAG resulted from more aggressive marketing and being able to sell the product through Marley Drug giving easier access to the medication for the consumer.

05:33 As a result of the acquisition of Marley Drug, which was completed on December seventeen twenty twenty, the company recorded revenue of one point eight six million during the second quarter ended June thirty, twenty twenty one, which was approximately two hundred thousand lower from the prior quarter from Marley Drug. 5:50 Cost of the goods sold remained at a constant percentage this quarter compared to the prior quarter at just over forty percent.

Selling expenses for twenty twenty total two point five million in the second quarter compared to two point eight million dollars in the first quarter. 06:04 The company consistently looks at ways to gain efficiencies at its operation and some efficiencies were realized costing selling expenses to moderately decrease in the quarter.

General and administrative expenses were flat in the second quarter compared the previous quarter at five hundred and seventy one thousand and five hundred and eighty five thousand dollars respectively. 6:23 The company is working very hard to [indiscernible] general and administrative expenses were possible and comps have been substantially reduced from the second quarter of twenty twenty where they were seven hundred and seventy thousand dollars.

Research and development expenses totaled seven hundred and sixty five thousand dollars for the second quarter of twenty twenty one and one hundred thousand dollars for the comparable period in twenty twenty. 6:46 The increase is primarily a result of different levels of research and development during any particular quarter and potential refunds and payments of fees paid to government agencies.

This resulted in a net loss for the second quarter of twenty twenty one of six hundred and thirty nine thousand dollars which equated to zero point zero six dollars a share compared to income of nineteen thousand dollars per share for the second quarter of twenty twenty. 7:12 Adjusted EBITDA for the second quarter was one hundred and fifty eight thousand dollars compared to adjusted EBITDA of two hundred and sixty three thousand dollars for the comparable period in twenty twenty.

The company is exposed to fluctuating currencies and in this quarter this negatively affected the company by approximately two hundred thousand dollars as the Canadian dollar gained strength. 07:32 As of June thirty, twenty twenty one, the company had cash totaling two point four six million dollars compared to two point seven million as of December thirty one, twenty twenty.

As of June thirty, twenty twenty one, the company had net working capital of three million compared to net working capital at December thirty one, twenty twenty of three point two million. 7:53 The company does not have any debt recorded on the statement of financial position, however, we are in the process of finalizing a loan with the commercial banks to replenish the cash and the established liquidity due to the Marley Drug acquisition.

08:08 I want to remind you that there will be an opportunity at the end of today's call for you to ask questions regarding the financial results the company as a whole. And with that, I would like to turn the call over to our President and Chief Operating Officer, Dr.

Neil Owens, for some additional commentary regarding our operations.

08:24 Thank you, David and good morning everyone. AGGRASTAT continues to maintain the majority of patient market share and remains the preferred glycoprotein in vitro inhibitor in more than twelve hundred U.S.

hospitals. 08:40 In the past quarter, there was no notable price competition from generic eptifibatide.

This reduced the pricing pressure on the net selling price of AGGRASTAT. Our team is pleased to report a six percent increase in net revenue compared to Q1 twenty twenty one.

We continue to work with key opinion leaders to effectively market AGGRASTAT and maintain market share. 09:05 Turning to ZYPITAMAG, which is a branded stat and used to control cholesterol.

Our team is pleased to report a forty percent increase in net revenue compared to Q1 twenty twenty one. This growth comes as a result of promotion from our sales team as well as marketing to prescribers and consumers to share the benefits of ZYPITAMAG.

09:25 Sales of ZYPITAMAG have also been facilitated by sales through Marley Drug. In Q4 twenty twenty, Medicure announced the acquisition of Marley Drug, which is a pharmacy located in North Carolina with national distribution of prescription medications.

It is known for its excellent customer service, home delivery and very competitive prices. 09:49 Marley Drug has built a nationwide customer base of more than thirty thousand.

One of the aspects of marketing products through Marley Drug is that in addition to an existing sales base, it provides a truly innovative sales channel. 10:06 Through Marley Drug Medicure can sell branded products without the use of wholesalers and insurance companies, which hurt our profits and impose limitations on access through step through therapy and prior authorizations.

It is also very appealing for healthcare providers who appreciate the simplicity uncertainty of filling ZYPITAMAG prescriptions through Marley Drug and the reaction has been extremely positive. 10:33 Sales through Q2 have remained consistent with Q1 and with an expanded marketing approach are expected to grow.

We are expanding our online presence of Marley Drug and exploring multiple revenue channels, including partnerships and membership plans. We continue to evaluate branded products and products with high market share potential to add to Medicure’s product portfolio, and those that would align well with our focus and contracts in U.S.

market, especially those that can be sold through Marley Drug. 11:06 The revenue generated through our hospital and consumer sales helps to support Medicure’s research and development activities, including cardiovascular abbreviated new drug applications or ANDAs and a new drug application for NDA.

11:22 Recently, Medicure announced the filing of an IND for a pivotal phase three study defined the first FDA approved therapy for patients with PNPO Deficiency, which is a rare pediatric disease, leading to seizures and is ultimately failed if untreated. 11:38 A successful use of Medicure’s product MC1, which could lead to a priority review voucher, which can be redeemed to obtain priority review for any subsequent marketing application.

11:51 In summary, Medicure continues to see success from AGGRASTAT, ZYPITAMAG, and Marley Drug. We are pleased to see the increase in net revenue this quarter and are more motivated than ever to increase sales.

12:05 Our team wants our investors to know that we are driven and dedicated to growing revenue and making Medicure a long term success. With that, I'd like to turn the call back to Dr.

Friesen for final comments.

12:16 Thank you, Neil. There was considerable learning and adapting in the past twelve months, which includes the integration of Marley Drug.

I'm looking at now how to leverage further the Marley Drug asset for continued growth. AGGRASTAT sales and profitability have been maintained.

Further development of new products such as the development of our legacy MC1 for the treatment of PNPO patients is progressing well. 12:45 We're thankful for the continued strength in AGGRASTAT markets, and we continue to focus on growing the business with a pipeline of cardiovascular products that will further diversify our revenue and asset base, carefully investing to grow our future profitability.

13:03 My goal and that of our Board, management and staff is to continue to build this business with a stable long term outlook to generating value for our shareholders. And as always, I want to express my sincere appreciation to the outstanding team of employees we've been so blessed with.

Thank you, our shareholders for continued support and interest and Chris, the moderator I'll turn it back to you for questions and answers. Thank you.

14:11 Yes. Good morning, Albert and Mr.

Gurvey, and Dr. Owen.

Tell me, the Marley Drug sales is that the fact that it was lower, is there a rationale for that in the current quarter?

14:42 Hello. Thank you very much for the question.

Marley Drug sales can often be dependent on specific marketing efforts. And just prior to the end of the first quarter it was a substantial mail order campaign, which involved significant discounting as a promotion.

So sales do fluctuate from those, but at the trend line they appear to be increasing, especially with the addition of the availability of ZYPITAMAG, which is clearly showing an increasing trend line with Marley Drug.

15:24 Okay. Now the money spent on R and D during this quarter, what did that apply to?

15:37 This is Neil. I was going to add the majority of that would be contributed towards our IND and study for MC1 of PNPO deficiency.

15:49 Okay. What are our plans to tell us story on Medicure besides these conference calls?

I know we hired an IR firm, what do we expect them to do for us?

16:10 We continue to explore other IR options. And with the growth now, we are just following up with expanded interest base and that we're going to follow-up with that expanded base that we've got for now, and then we'll explore further IR programs, but we right now, just looking at leveraging the database that we got with the last investor program.

16:43 All right, Albert. Thank you very much.

Good luck.

16:49 Thanks Sam.

17:09 Thank you for all that were listening. Appreciate the interest and we look forward to our next call.

Have a great day.