Financial Data and Key Metrics Changes - The company reported revenues of $63.8 million for Q1 2025, representing a 196% increase year-over-year, excluding a nonrecurring reduction in reserves for product returns of $4.1 million from Q4 2024 [31][7][14] - Cost of sales for Q1 2025 was $8.8 million, compared to $3.3 million in Q1 2024, primarily due to amortization related to a sales milestone [32] - R&D expenses decreased by 24% year-over-year to $17.5 million, while SG&A expenses increased by 17% to $64 million due to investments in the commercial organization [33] Business Line Data and Key Metrics Changes - The Zurief portfolio achieved net product revenue of $68.3 million in Q1 2025, reflecting a 196% growth year-over-year [14] - Prescription demand for Zurief grew by 10% compared to Q4 2024, with a record high of 17,000 weekly prescriptions on a rolling four-week average [15][9] - The company anticipates further expansion of Zurief's approved indications in 2025, including a new foam formulation for scalp and body psoriasis [9][10] Market Data and Key Metrics Changes - The topical steroid market has declined by 200 basis points over the past year, with branded topicals, led by Zurief, capturing that share [20] - The company has achieved approximately 80% insurance reimbursement for Zurief prescriptions, indicating strong payer access [17] - The total addressable market includes 17 million patients currently treated with topical steroids, presenting a significant growth opportunity for Zurief [11][12] Company Strategy and Development Direction - The company is focused on converting the large topical steroid market to its nonsteroidal treatments, with a strong emphasis on the unique attributes of Zurief [5][6] - The management highlighted the importance of expanding coverage and partnerships to access the entire patient opportunity [12] - The company aims to achieve cash breakeven by 2026, supported by the growth of the Zurief portfolio and improved profitability [34][36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining growth throughout 2025 and beyond, citing multiple upcoming catalysts and expanding markets [5][6] - There is a growing momentum among clinicians shifting away from topical steroids, which is expected to accelerate [27][38] - The company remains optimistic about achieving cash flow breakeven in 2026, supported by a strong balance sheet and revenue growth [39][36] Other Important Information - The company announced a joint stipulation to stay ongoing patent litigation, allowing for a delay in litigation costs and distractions [10] - The company has a total debt of $107.6 million and the option to withdraw $100 million, providing financial flexibility [37] Q&A Session Summary Question: What is the expected cadence of Zurief performance throughout the year? - Management expects some seasonal impact but remains positive about growth drivers, including the upcoming launch of foam for scalp and body psoriasis [43] Question: What are the expectations for the ARQ 255 readout? - The Phase 1b trial focuses on safety and tolerability, with results expected in mid-2025 [44] Question: How will the new scalp and body psoriasis indication impact Zurief foam utilization? - Management anticipates broader utilization of Zurief foam without significant cannibalization of the cream, as it offers unique benefits for scalp involvement [51][52] Question: What is the current split of psoriasis patients treated in dermatology versus primary care? - The split is approximately 50/50, with primary care expected to become a significant contributor to growth over time [71] Question: What are the next steps after the patent litigation stay? - The stay is indefinite, and the company will provide quarterly updates to the court regarding the status of the dispute [78]

Financial Performance - Q1 2025 net product revenue reached $63.8 million for ZORYVE®[28], a 196% increase compared to the prior year[37] - Total revenues for Q1 2025 were $65.8 million, a $16.3 million increase year-over-year[73] - Net loss for Q1 2025 was $(25.1) million, an improvement of $10.3 million compared to Q1 2024[73] - Cash, cash equivalents, and marketable securities totaled $198.7 million as of March 31, 2025[77] Commercial Progress - Prescription demand for ZORYVE grew by 10%[28] from Q4 2024 to Q1 2025[39] - Over 80% of ZORYVE prescriptions are covered by insurance[43] - ZORYVE's TRx share in the branded topical segment has grown from 11% to 41%[50] - The branded topical segment grew by 50%[47] Pipeline and Regulatory Milestones - Anticipated FDA approval of ZORYVE foam 0.3% for scalp & body psoriasis with a target PDUFA date in May 2025[28, 59] - The company submitted a supplemental New Drug Application (sNDA) for ZORYVE Cream 0.05% in ages 2-5 for Atopic Dermatitis with an anticipated target action date of October 13, 2025[59]

Financial Performance - The company reported net losses of $25.1 million and $35.4 million for the three months ended March 31, 2025 and 2024, respectively, with an accumulated deficit of $1,147.0 million as of March 31, 2025[111]. - Total product revenue, net for the three months ended March 31, 2025, was $63.8 million, a 196% increase from $21.6 million in the same period of 2024[132]. - ZORYVE foam generated $30.2 million in revenue for the three months ended March 31, 2025, up 362% from $6.5 million in the same period of 2024[132]. - Other revenue for the three months ended March 31, 2025, was $2.0 million, compared to $28.0 million in the same period of 2024, which included $25.0 million from the Sato License Agreement[136]. - For the three months ended March 31, 2025, net cash used in operating activities was $30.4 million, compared to $31.6 million for the same period in 2024[162][163]. - Net cash provided by financing activities for the three months ended March 31, 2025, was $0.4 million, significantly lower than $161.8 million in the same period of 2024, which included proceeds from a public stock offering[166]. Research and Development - The company launched ZORYVE cream 0.3% in August 2022 and received FDA approval for expanded indications down to 6 years of age in October 2023, with plans to further expand to 2 years of age[105]. - The company completed a Phase 3 trial of ZORYVE cream 0.05% for pediatric patients aged 2 to 5 years, with a supplemental new drug application submitted in December 2024[106]. - The company expects to incur significant commercialization expenses in 2025 related to ZORYVE, while focusing clinical development on ARQ-234, ARQ-255, and ZORYVE label extensions[112]. - The company plans to submit an Investigational New Drug application for ARQ-234 during 2025, targeting atopic dermatitis[110]. - The company has incurred research and development expenses focused on clinical trials and regulatory filings, with expectations for continued expenses in the future[120]. Expenses - Research and development expenses decreased by $5.6 million, or 24%, for the three months ended March 31, 2025, totaling $17.5 million compared to $23.1 million in 2024[139]. - Selling, general, and administrative expenses increased by $9.2 million, or 17%, for the three months ended March 31, 2025, primarily due to higher compensation expenses[140]. Cash and Debt Management - The company reported a cash balance of $198.7 million as of March 31, 2025, with $100.0 million outstanding under a Loan Agreement[111]. - The company made a $100.0 million principal paydown on its Loan Agreement in October 2024, reducing the outstanding principal to $100.0 million[150]. - Interest expense decreased by $4.5 million for the three months ended March 31, 2025, due to a lower outstanding principal balance and lower interest rates[142]. - The applicable interest rate on the Loan Agreement was reduced to 5.95% plus the greater of 2.50% or the one-month SOFR following the 2024 Partial Prepayment[152]. - The company had $100.0 million outstanding under its Loan Agreement, with a floating interest rate of 5.95% plus a minimum of 2.50%[170]. - A 100 basis point increase in interest rates would result in approximately $1.0 million of additional annual interest expense based on the outstanding amount under the Loan Agreement[170]. Compliance and Risks - The company must generate a minimum net product revenue equal to 75% of projected net product revenue as per its financial covenant under the Loan Agreement[156]. - The company was in compliance with all covenants under the Loan Agreement as of March 31, 2025[159]. - The company is exposed to foreign currency exchange risk, with cash balances of $3.8 million denominated in Canadian dollars as of March 31, 2025[171]. - The company expects existing capital resources to meet projected operating requirements for at least 12 months from the date of the financial statements[147].

Revenue Performance - Q1 2025 net product revenue for ZORYVE was $63.8 million, a 196% increase compared to Q1 2024, but a 2% decrease from Q4 2024[4] - Total revenues for Q1 2025 reached $65.846 million, a 32.7% increase from $49.569 million in Q1 2024[26] - Product revenue, net, significantly increased to $63.846 million from $21.569 million, marking a 196.5% growth year-over-year[26] Expenses - Selling, general, and administrative expenses for Q1 2025 were $64.0 million, up from $54.8 million in Q1 2024, primarily due to increased compensation and personnel-related expenses[15] - Operating expenses totaled $90.375 million, up from $81.191 million, reflecting an increase of 11.5%[26] - Research and development expenses decreased to $17.5 million in Q1 2025 from $23.1 million in Q1 2024, attributed to reduced clinical development costs[14] - Research and development expenses decreased to $17.543 million from $23.141 million, a reduction of 24.2%[26] - Other income, net, was $2.730 million, down from $4.044 million, a decrease of 32.4%[26] - Interest expense decreased significantly to $(2.982) million from $(7.480) million, a reduction of 60.1%[26] Net Loss - The company reported a net loss of $25.1 million, or $0.20 per share, for Q1 2025, compared to a net loss of $35.4 million, or $0.32 per share, for Q1 2024[16] - The net loss for Q1 2025 was $25.060 million, an improvement compared to a net loss of $35.382 million in Q1 2024, representing a 29.2% reduction[26] - Net loss per share improved to $(0.20) from $(0.32) year-over-year[26] Product Demand and Development - Demand for ZORYVE cream 0.3% in plaque psoriasis grew with over 425,000 prescriptions filled since launch, reflecting high patient and physician satisfaction[8] - ZORYVE cream 0.15% for atopic dermatitis has filled over 69,000 prescriptions since launch, with coverage by the three largest national Pharmacy Benefit Managers[8] - The company submitted a supplemental New Drug Application for ZORYVE cream 0.05% for treating atopic dermatitis in children ages 2 to 5, with a PDUFA action date of October 13, 2025[8] - The company has a PDUFA action date of May 22, 2025, for ZORYVE foam 0.3% for treating plaque psoriasis of the scalp and body[4] Legal Matters - The patent litigation against Padagis was stayed, with the court cancelling all case deadlines, including the trial[4] Cash Position - Cash, cash equivalents, and marketable securities totaled $198.7 million as of March 31, 2025, down from $228.6 million at the end of 2024[16] Share Information - The weighted-average shares used in computing net loss per share increased to 126,036,862 from 111,048,525, an increase of 13.5%[26]

Core Insights - Arcutis Biotherapeutics reported strong financial performance in Q1 2025, driven by significant demand growth for its ZORYVE portfolio, which offers a safe alternative to steroids [2][6][10] - The company is expanding its market presence with additional indications and coverage for ZORYVE, alongside a promising pipeline of products [2][6][8] Financial Performance - Q1 2025 net product revenue for ZORYVE reached $63.8 million, marking a 196% increase compared to Q1 2024, but a 2% decrease from Q4 2024 [6][10] - Total revenues for Q1 2025 were $65.8 million, compared to $49.6 million in Q1 2024 [10][24] - The net loss for Q1 2025 was $25.1 million, or $0.20 per share, an improvement from a net loss of $35.4 million, or $0.32 per share, in Q1 2024 [14][24] Product Updates - ZORYVE cream and foam are approved for treating various skin conditions, with ZORYVE cream 0.3% being the most prescribed non-steroidal topical treatment for plaque psoriasis and atopic dermatitis [3][4][7] - The company has submitted supplemental New Drug Applications (sNDAs) for ZORYVE cream 0.05% for children and ZORYVE foam for scalp and body psoriasis, with action dates set for October 13, 2025, and May 22, 2025, respectively [7][10] Market Expansion - Over 425,000 prescriptions for ZORYVE cream 0.3% have been filled since its launch, indicating strong physician and patient satisfaction [7] - The company is expanding Medicaid coverage, with over 50% of recipients now covered, and all three largest national Pharmacy Benefit Managers (PBMs) covering the entire ZORYVE portfolio [2][6] Research and Development - Arcutis is advancing its pipeline, including ARQ-255 for alopecia areata, with data expected in mid-2025 [8] - The company is also developing ARQ-234, a potential biologic treatment for atopic dermatitis, with plans to submit an Investigational New Drug application in 2025 [8] Corporate Developments - Latha Vairavan was appointed as Chief Financial Officer effective May 6, 2025 [15] - The company obtained two new U.S. patents related to topical roflumilast compositions in Q1 2025 [15]

Wall Street expects a year-over-year increase in earnings on higher revenues when Arcutis Biotherapeutics, Inc. (ARQT) reports results for the quarter ended March 2025. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates.The earnings report, which is expected to be released on May 6, 2025, might help the stock move higher if these key numbers are be ...

Core Insights - The article discusses potential investment opportunities in ARQT, indicating a possible long position in the stock within the next 72 hours [1]. Group 1 - The analyst has no current stock or derivative positions in the companies mentioned but may initiate a beneficial long position [1]. - The article expresses the author's own opinions and is not influenced by compensation from any company [1]. - There is no business relationship with any company whose stock is mentioned in the article [1].

Core Viewpoint - Arcutis Biotherapeutics, Inc. will report its first quarter 2025 financial results and provide a business update on May 6, 2025, after U.S. financial markets close [1] Company Overview - Arcutis Biotherapeutics, Inc. is a commercial-stage medical dermatology company focused on innovations in immuno-dermatology, addressing the needs of individuals with immune-mediated dermatological diseases [3] - The company has a growing portfolio that includes three FDA-approved products and a robust pipeline targeting various inflammatory dermatological conditions such as scalp and body psoriasis, atopic dermatitis, and alopecia areata [3] Upcoming Events - A conference call and webcast will be held on May 6, 2025, at 4:30 p.m. ET, with a live webcast available on the company's website [2]

Core Insights - Arcutis Biotherapeutics announces the retirement of CFO David Topper and the appointment of Latha Vairavan as the new CFO, effective May 15, 2025, as part of a planned succession [1][3][5] Company Leadership Transition - David Topper has served as CFO since April 2024, playing a crucial role in strengthening Arcutis' financial position, including renegotiating debt and enhancing investor relations [2][3] - Latha Vairavan, with over 20 years of finance experience in the biotech industry, will succeed Topper, bringing a deep understanding of the business and strong industry relationships [4][5] Financial Position and Growth Strategy - Under Topper's leadership, Arcutis has positioned itself for future growth, with a focus on the commercialization of its product ZORYVE [2][3][5] - Vairavan expressed excitement about her new role, emphasizing the company's momentum and commitment to further commercializing ZORYVE for various inflammatory skin conditions [5] Company Overview - Arcutis Biotherapeutics is a commercial-stage medical dermatology company focused on innovations for immune-mediated dermatological diseases, with a growing portfolio that includes three FDA-approved products [5]

Core Viewpoint - Arcutis Biotherapeutics, Inc. (ARQT) shares experienced a significant increase of 10.8% to close at $16.60, driven by strong trading volume and positive developments in patent litigation [1][2]. Company Summary - The stock's recent rally was influenced by Padagis requesting a stay in the ongoing patent litigation concerning Arcutis' Zoryve (roflumilast) cream 0.3%, which is used for treating plaque psoriasis [2]. - Arcutis is projected to report a quarterly loss of $0.17 per share, reflecting a year-over-year increase of 46.9%, with expected revenues of $63.95 million, marking a 29% rise from the previous year [2]. - The consensus EPS estimate for Arcutis has remained stable over the last 30 days, indicating that the stock's price movement may not sustain without changes in earnings estimate revisions [4]. Industry Summary - Arcutis operates within the Zacks Medical - Biomedical and Genetics industry, where another company, Codexis (CDXS), saw a decline of 0.8% to $2.49 and has returned -6.3% over the past month [4]. - Codexis has experienced a 4.4% increase in its consensus EPS estimate for the upcoming report, now at -$0.20, which is a 25% decrease from the previous year's report [5].