Michael Freeman

Michael Freeman asked if 2026 would be the peak year for Xifaxan sales given renegotiated Medicare rates for 2027, and what plans are in place to accelerate 2026 sales and mitigate 2027 impacts. He also questioned the framework for the full separation of Bausch + Lomb, asking what developments are hoped for before pursuing it.

Answer

CEO Thomas Appio emphasized continued focus on Xifaxan growth through AI engine efficiency and addressing unmet patient needs. CFO JJ Charhon clarified that 2025 might be the peak *reported* year for Xifaxan due to one-time benefits, but *operationally* in served channels, growth is expected in 2026, noting a Q4 2026 gross-to-net adjustment for 2027 CMS rebates. Regarding Bausch + Lomb, Thomas Appio stated that refinancing provides flexibility, and the company believes in Bausch + Lomb's growth plan, awaiting market reflection of its value. JJ Charhon added that refinancing covers maturities until late 2028, allowing patience, and the highest probability outcome for monetization is selling the BNL equity stake.

Michael Freeman asked if 2026 would be the peak year for Xifaxan sales given Medicare rate renegotiations for 2027, and how Bausch Health plans to accelerate sales and mitigate future impacts. He also inquired about the framework and timing for the full separation of Bausch + Lomb.

Answer

Thomas Appio, CEO, highlighted continued Xifaxan growth through AI-driven commercial execution and addressing unmet patient needs. JJ Charhon, CFO, clarified that 2025 might be the reported peak due to one-time benefits, but operational growth in served channels will continue in 2026, with accounting adjustments for 2027 CMS rebates. Regarding Bausch + Lomb, Thomas Appio, CEO, expressed confidence in its growth story, pipeline, and team, awaiting market value reflection. JJ Charhon, CFO, added that refinancing provides flexibility until 2028, allowing patience for BNL's share price to improve, with monetization likely through selling the equity stake.

Michael Freeman requested more detail on the flexibility gained from the recent debt refinancing, the quantum of the unpledged Bausch & Lomb (BLCO) stake, and insight into the recent proxy supplement and the shareholder rights plan.

Answer

CFO JJ Charhon detailed that the refinancing extended the debt runway, leaving approximately $5.6 billion in maturities through 2028, much of which can be handled by free cash flow. He confirmed 35.5% of BLCO shares remain unencumbered. CEO Thomas Appio explained the shareholder rights plan was adopted to ensure fair treatment in any takeover bid and noted the positive market reaction to the proxy filing, which he believes shows investors see value in the company.

Michael Freeman asked about the company's preparations for Xifaxan's inclusion in Medicare price negotiations, the potential impact of a pharma-oriented international tariff, and whether new CMO Dr. Jonathan Sadeh is bringing changes to the clinical development approach.

Answer

CEO Thomas Appio stated it's still early in the Medicare negotiation process, but the team is focused on demonstrating Xifaxan's value, particularly the cost savings from reduced hospitalizations in the HE indication. CFO JJ Charhon added that the cash flow impact of a potential 25% tariff would be below $50 million annually. Appio also expressed excitement about Dr. Sadeh's arrival and confirmed they are actively discussing how to build the future pipeline, including both internal development and external business development.

Michael Freeman requested more granular details on the market reception of Thermage FLX in China following its recent launch. He also asked if the company would reconsider a potential IPO for its Solta Medical business, given its strong global growth prospects.

Answer

CEO Thomas Appio expressed high enthusiasm for Solta's growth in China, citing new leadership and investments. He also detailed strong performance in other APAC and European markets. Regarding a Solta IPO, he described the business as a valuable asset to Bausch Health and affirmed his plan is to continue investing in and growing it globally, without directly addressing the IPO possibility.

Michael Freeman asked about any indications of interest for ZUNVEYL from outside the long-term care setting. He also requested more color on early patient feedback regarding efficacy and adverse events, and inquired about the company's plans to collate and publish real-world evidence. Finally, he questioned the company's cash position and its runway to reach breakeven.

Answer

COO Lauren D'Angelo confirmed interest from the retail setting and noted a system is in place to address these leads. CEO Michael McFadden highlighted early efficacy at the starting dose and the absence of reported GI side effects. D'Angelo shared two positive patient anecdotes detailing significant improvements in behavior and sleep. McFadden added that the medical team is actively pursuing publication of real-world data, with abstracts accepted at AAIC and a retrospective analysis planned. CFO Henry Du stated that the company is comfortable with its debt-free balance sheet and believes its current capital is sufficient to fund operations to a positive cash flow position.

Michael Freeman inquired about the timeline for ZUNVEYL's commercial payer agreements, early physician feedback from the long-term care market, and the company's cash runway following its recent financing.

Answer

COO Lauren D'Angelo stated that while formal payer contracts are targeted for early 2026, ZUNVEYL is currently accessible via medical necessity forms. She highlighted 'overwhelmingly positive' physician feedback on the drug's differentiated profile. CEO Michael McFadden added that the current cash position is sufficient to reach breakeven in year 3 of the launch, contingent on revenue execution and expense management, without needing additional capital for the core long-term care commercialization.

Michael Freeman of Raymond James asked for clarification on the metastatic breast cancer program, specifically whether exploring treatment in earlier-stage patients is an alternative to the previously discussed registration-enabling trial. He also requested details on the structure, terms, and flexibility of the new USD 20 million share purchase agreement with Alumni Capital.

Answer

Dr. Tom Heineman, Chief Medical Officer, clarified that the company is not shifting its focus but exploring opportunities in the evolving treatment landscape, particularly in patients who have failed antibody-drug conjugate (ADC) therapy, which could de-risk the program. Kirk Look, Chief Financial Officer, explained that the share purchase agreement provides capital at the company's discretion with a $750,000 minimum purchase notice. He noted it includes an upfront commitment fee and pro-rata fees to reduce capital costs, extending the financial runway through key milestones.

Michael Freeman asked for clarification on the metastatic breast cancer program strategy, questioning whether the discussion of treating patients at different or earlier stages represented a shift away from the previously planned registrational trial. He also inquired about the structure, terms, and flexibility of the new share purchase agreement with Alumni Capital and whether the company had utilized it yet.

Answer

Chief Medical Officer Dr. Tom Heineman clarified that the company is not shifting its focus but is exploring opportunities in the evolving treatment landscape, particularly in patients who have failed antibody-drug conjugate (ADC) therapy. He suggested a smaller, targeted study in this post-ADC population could further de-risk the program. Chief Financial Officer Kirk Look explained that the share purchase agreement provides access to capital at the company's discretion, with a structure designed to reduce capital costs. He confirmed the facility has been tapped 'a little bit' to ensure it functions as intended.

Michael Freeman of Raymond James inquired about the projected cost and timeline for the upcoming registration-enabling breast cancer study, the potential for an 'oncolytic virus renaissance' to drive pharmaceutical interest, and the status and potential acceleration of the GCAR collaboration for pancreatic cancer.

Answer

CFO Kirk Look detailed the study timeline, noting it would be initiated in the latter half of the year with an 18-month enrollment period and a futility analysis expected around 14 months post-enrollment, but stated it was premature to provide a total cost. VP of Business Development Christophe DeGois and CFO Kirk Look confirmed increased investor and pharma interest in the oncolytic virus space, citing recent competitor activity as beneficial. Chief Medical Officer Dr. Tom Heineman explained that the GCAR collaboration is moving at the 'greatest possible pace' but timing specifics are pending FDA discussions.

Michael Freeman from Raymond James, on behalf of Rahul Sarugaser, asked about the strategic interaction between the two pancreatic cancer trials and sought clarity on the data being presented at the upcoming ASCO conference.

Answer

CEO Dr. Matt Coffey and CMO Dr. Thomas Heineman clarified the pancreatic cancer strategy. They explained that studying pelareorep with both major chemotherapy backbones (gemcitabine/nab-paclitaxel and mFOLFIRINOX) aims to make the therapy available to the broadest range of first-line patients. Regarding ASCO, Dr. Heineman stated the presentation on the mFOLFIRINOX study will be a 'trial-in-progress' poster outlining the study design and will not contain any clinical data.

Michael Freeman asked about WELL Health's strategy for achieving 10% market share in Canadian clinics, including the necessary scaling of its transformation organization and potential risks. He also inquired about the planned divestiture of CRH and provider staffing, asking if they would be sold together and what valuation multiples might be expected.

Answer

Chairman and CEO Hamed Shahbazi explained that the growth strategy focuses on acquiring and improving smaller clinics, a process supported by their recently scaled clinic transformation team. He noted that divesting U.S. assets would free up capital for larger, transformational acquisitions in Canada. Regarding the CRH and provider staffing assets, Shahbazi stated a preference for selling them as a single unit but is open to separate deals, and while he hopes for double-digit multiples, he noted that provider staffing might command a higher valuation due to market dynamics.

Michael Freeman of Raymond James inquired about the specific IFRS service obligation that Circle Medical failed to meet, which led to the revenue deferral, and asked for details on how the settlement amount for the related U.S. regulatory investigation was estimated.

Answer

Hamed Shahbazi, Chairman and CEO, explained that he could not provide significant detail on the IFRS obligation due to ongoing regulatory discussions, but characterized it as an "administrative matter." He stated that the settlement estimate was determined with guidance from specialized legal advisers based on precedents for similar civil matters and was subsequently audited to ensure it was a reasonable provision.

Michael Freeman of Raymond James asked how the combined Healwell, Orion, and WELL Health entities can compete against large players like Epic and Cerner, inquired about geographic focus for the next 1-2 years, and sought clarity on the "larger than anticipated" opportunity set.

Answer

Executive Alexander Dobranowski explained that the combined ecosystem allows them to bid more broadly and compete directly with large incumbents. He identified Canada, the Commonwealth, the Middle East, and the U.K./Europe as key geographic focus areas. He added that the opportunity is larger than expected due to the rapid potential for integrating Healwell's AI into Orion's established global footprint.

Michael Freeman requested guidance on pro forma organic growth rates for each business segment post-Orion, the outlook for operating expense margins, and the company's go-forward M&A strategy regarding geographies and target types.

Answer

CFO Anthony Lam provided 2025 growth expectations: the AI/Data Science segment to potentially double, Health Care Software to approach $100 million, and Clinical Research to increase by 50%. He advised using Q4's expense structure as a baseline, noting that significant one-time costs from 2024, such as IR awareness and fundraising, would not repeat at the same level. CEO Dr. Alexander Dobranowski added that the M&A focus will be on bolstering AI capabilities and pursuing synergistic acquisitions in jurisdictions where Orion operates.

Michael Freeman requested pro forma organic growth expectations for each business segment post-Orion, guidance on operating expense margins, and insight into the geographic and company-type focus for future M&A.

Answer

CFO Anthony Lam provided 2025 growth targets: AI/Data Science revenue to double, Health Care Software to approach $100 million, and Clinical Research to grow by 50%. He advised using Q4's expense structure as a baseline, noting that significant 2024 costs for IR and fundraising would not repeat at the same level. CEO Dr. Alexander Dobranowski added that M&A will target companies that bolster AI capabilities and are synergistic with Orion Health's global footprint.

Asked for pro forma guidance post-Orion acquisition, including organic growth rate expectations for each business segment, projected operating expense margins, and the company's future M&A strategy regarding geographies and company types.

Answer

Post-Orion, the data science segment is expected to double revenue, health care software to approach $100M, and clinical research to grow by 50%. Gross margins are expected to approach 50%, with a similar opex structure to Q4 but significantly lower IR and fundraising costs. M&A will focus on AI patient identification capabilities and synergistic acquisitions in jurisdictions where Orion operates.

Michael Freeman asked how the combined capabilities of Healwell, WELL Health, and Orion Health position the company to compete against large incumbents like Epic and Cerner in public sector RFPs. He also inquired about the key geographic areas of focus for the company over the next 12 to 24 months and sought clarification on why the company's opportunity set is now viewed as larger than originally anticipated.

Answer

Executive Alexander Dobranowski stated that the combined ecosystem of Healwell, WELL Health, and Orion Health creates a spectrum of capabilities that for the first time allows them to bid more broadly and compete credibly against major players like Epic and Cerner. He identified Canada, the extended Commonwealth, the Middle East, and the U.K./Europe as key geographic focus areas. Dobranowski explained the opportunity set is larger than expected primarily because of the practical and rapid potential to integrate Healwell's AI into the Orion Health footprint, creating a larger-than-anticipated value proposition.

Michael Freeman of Raymond James requested color on Medicare patient engagement in Q1 following new CMS reimbursement, asked about the timeline for marketing initiatives like ex-NFL spokespeople, and sought more detail on the pacing of the sales pipeline to achieve the year's back-end loaded revenue goals.

Answer

CEO Arun Menawat noted that while the reimbursement impact was small early in Q1, they are now seeing hospitals get paid and a corresponding increase in the patient pipeline. Chief Commercial Officer Thomas Tamberrino confirmed that marketing efforts, including digital campaigns and leveraging celebrity patient stories, are ramping up now. Regarding the pipeline, both executives described a multi-pronged strategy targeting top cancer centers, ASCs, and leveraging MRI manufacturer partnerships, stating that all early indicators are positive.

Michael Freeman of Raymond James asked about Q1 data on Medicare patient engagement following new CMS reimbursement, the company's marketing plans, including the use of celebrity spokespeople, and for more detail on the pacing of the sales pipeline.

Answer

CEO Arun Menawat noted that while the financial impact of CMS reimbursement was minimal early in Q1, they are now seeing hospitals get paid, which is building the patient pipeline. Chief Commercial Officer Thomas Tamberrino confirmed that an immersive digital marketing campaign featuring patient testimonials, including from ex-NFL players, is imminent. Tamberrino and Menawat described the pipeline strategy as a multi-pronged effort targeting top cancer centers, ASCs, and OBLs, accelerated by MRI manufacturer partnerships and growing patient waiting lists.

Michael Freeman of Raymond James questioned the launch timing and regulatory path for the BPH AI module, asked about Q1 utilization and Medicare payment uptake, and inquired about the strategy for securing coverage from private insurers.

Answer

President Dr. Mathieu Burtnyk confirmed the BPH module demo is set for the AUA meeting, aligning with a mid-year 2025 launch, and stated regulatory clearance is factored into their project plan. CEO Arun Menawat noted that while it's too early for concrete Medicare payment data due to lags, recurring revenue trends are positive. He added that they are seeing anecdotal payments from large private insurers and that the commercial team, under Tom Tamberrino, is building a dedicated unit to strategically pursue and prioritize private payer coverage.