Core Viewpoint - Heron Therapeutics has adopted a Section 382 rights plan to protect its net operating loss carryforwards (NOLs) and other tax attributes, which are crucial for offsetting future taxable income [1][2][3] Group 1: Rights Plan Details - The Board of Directors unanimously approved the Rights Plan, which is effective from August 14, 2025, and will expire one year later unless terminated or extended [1][2] - The Rights Plan aims to deter any single investor or group from acquiring 4.99% or more of Heron's outstanding common stock, thereby reducing the risk of an "ownership change" that could limit the use of NOLs [2][3] Group 2: Financial Context - As of December 31, 2024, Heron had approximately $1.37 billion in U.S. federal NOLs available to offset future taxable income, which can enhance cash flow as the company pursues its growth strategy [2] - The adoption of the Rights Plan is intended to protect the potential value of these NOLs as the company executes its growth plans [3] Group 3: Company Overview - Heron Therapeutics is a commercial-stage biotechnology company focused on developing and commercializing therapeutic innovations to improve patient care, particularly in acute care and oncology [4]

Company Performance - Heron Therapeutics reported a quarterly loss of $0.02 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.01, but an improvement from a loss of $0.06 per share a year ago, indicating a surprise of -100.00% [1] - The company posted revenues of $37.2 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 1.89%, but showing an increase from $36.02 million in the same quarter last year [2] - Over the last four quarters, Heron Therapeutics has surpassed consensus EPS estimates two times and topped consensus revenue estimates two times [2] Stock Performance - Heron Therapeutics shares have increased approximately 20.3% since the beginning of the year, outperforming the S&P 500's gain of 7.8% [3] - The current consensus EPS estimate for the upcoming quarter is breakeven on revenues of $39.28 million, while for the current fiscal year, it is -$0.02 on revenues of $158.1 million [7] Industry Outlook - The Medical - Drugs industry, to which Heron Therapeutics belongs, is currently ranked in the top 32% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Heron Therapeutics' stock performance [5]

Financial Data and Key Metrics Changes - The company reported total net revenues of $37.2 million for Q2 2025 and $76.1 million year-to-date, with adjusted EBITDA of $7.9 million for the first half of the year, indicating a focus on operational efficiency [8][22] - Product gross profit for Q2 2025 was $27.3 million or 73.5%, an increase from 70.8% in Q2 2024, while year-to-date gross profit was $57.8 million or 75.9%, up from 73.2% in the same period last year [19][20] - The company incurred a net loss of $2.4 million for Q2 2025, compared to a net loss of $9.2 million in Q2 2024, and reported a net income of $300,000 for the first half of 2025, a significant improvement from a net loss of $12.4 million in the same period last year [21][22] Business Line Data and Key Metrics Changes - Combined net revenues from OPONVI and ZINRALF totaled $10.7 million for Q2 2025, reflecting a year-over-year growth of 55.5% for the quarter and 70.5% year-to-date compared to the same periods in 2024 [10][11] - Zenerlef adoption showed a 6.3% increase in demand units over Q1 2025, with total ordering accounts exceeding 700 by June [11][12] - Oponvi demand units grew by 19% in June, while net revenue grew by 9% over Q1, indicating strong market performance despite inventory adjustments [14][36] Market Data and Key Metrics Changes - The oncology franchise generated combined net revenues of $26.5 million for Q2 2025, maintaining market share in a competitive environment [16] - The transition from a C code to a permanent J code for Zenerlef, effective October 1, is expected to streamline reimbursement processes and improve access across payers [9][29] Company Strategy and Development Direction - The company successfully completed a new financing round, enhancing its financial flexibility and positioning for strategic initiatives [7] - A restructuring of the sales force was implemented to better align teams with product focus, aiming to drive growth in the second half of the year [18][43] - The company is exploring creative strategies to drive continued growth in the oncology supportive care market [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to drive innovation and expand commercial initiatives, supported by strong product demand growth [8][10] - The management noted that while immediate impacts from the J code for Zenerlef may not be seen, it is expected to facilitate reimbursement and adoption in the long term [29][48] - The company maintained its net revenue guidance of $153 million to $163 million for 2025 and revised adjusted EBITDA guidance to a range of $9 million to $13 million [22] Other Important Information - The company entered into a refinancing agreement that includes a new credit facility and the issuance of senior convertible notes, which will strengthen its balance sheet [22][23] - Cash and short-term investments as of June 30, 2025, were reported at $40.6 million [21] Q&A Session Summary Question: Details on the Zenerlef 400 mg transition and Q2 revenue impact - The transition began at the end of Q4 2024, with inventory normalization expected to complete by July 1, 2025 [26][27] Question: Impact of the J code on reimbursement and adoption - The J code is expected to simplify reimbursement processes and improve adoption over time as commercial payers align with Medicare practices [28][29] Question: Zenerlef sales force reorganization and its impact - The sales force was restructured to focus on specific products, enhancing engagement with targeted accounts [33][34] Question: Aponvi demand and revenue growth - The growth in demand was primarily due to wholesaler inventory adjustments, with expectations for normalization in the second half of the year [36][37] Question: Overall share count after recent transactions - The pro forma common share count is approximately 183 million shares [50] Question: Rate on the senior credit facility and cash addition to the balance sheet - The overall rate on the senior credit facility is slightly above 10%, with an expected addition of $11 to $12 million to the balance sheet after expenses [52][53]

127,127,127 Heron Therapeutics Q2 2025 Earnings Call August 8, 2025 26,68,148 84,184,72 0,125,195 75,40,108 1 Forward-looking Statements and Non-GAAP Disclosures This presentation contains "forward-looking statements" as defined by the Private Securities Litigation Reform Act of 1995. We caution investors that forward-looking statements are based on management's expectations and assumptions as of the date hereof and are subject to certain risks and uncertainties that could cause actual results to differ mat ...

Core Insights - Heron Therapeutics reported a 55.5% increase in Acute Care segment revenue, but faced a GAAP revenue shortfall compared to analyst expectations and continued declines in the Oncology segment [1][5][7] - Net revenue (GAAP) for Q2 2025 was $37.2 million, slightly below the consensus estimate of $38.075 million, with a year-over-year growth of 3.3% [1][2] - The company achieved a positive adjusted EBITDA of $1.8 million, indicating improved operational leverage [2][8] Financial Performance - GAAP loss per share was $(0.02), missing the expectation of $(0.01), while operating losses narrowed [1][2] - Acute Care revenue reached $10.7 million, up from $6.9 million in Q2 2024, reflecting a 55.5% year-over-year increase [2][5] - Oncology segment revenue declined by 9.0%, with SUSTOL experiencing a significant drop of 43.4% [2][7] Business Overview - Heron Therapeutics focuses on developing and commercializing therapeutics for acute care and oncology, including pain management and anti-nausea drugs [3] - The company is emphasizing growth in the Acute Care business, particularly through products like ZYNRELEF and APONVIE [4][10] Product Performance - ZYNRELEF saw a 40.4% year-over-year growth in GAAP net revenue, with unit demand increasing by 6.3% compared to Q1 2025 [5] - APONVIE's revenue grew by 141.6% year-over-year, with a 19% sequential increase in unit demand [6] - The Oncology segment's decline was attributed to ongoing weakness in SUSTOL and CINVANTI, with no new product drivers announced [7] Operational Developments - Gross margin was reported at 73.5%, with operating expenses decreasing by $3.0 million year-over-year to $29.0 million [8] - Total debt was reduced to $145 million, with maturities extended to at least 2030, providing greater flexibility for growth [8] - Cash and short-term investments decreased to $40.6 million, with a notable inventory increase of almost $20 million over six months [9] Future Outlook - The company reaffirmed its full-year 2025 net revenue target of $153.0 million to $163.0 million, requiring at least $77 million in the second half of 2025 [11] - Adjusted EBITDA guidance was raised to $9.0 million to $13.0 million for full-year 2025, reflecting improved operating performance [11] - Future growth in Acute Care revenue is expected to be driven by commercial team expansion and the rollout of permanent reimbursement codes for ZYNRELEF [11]

PART I. FINANCIAL INFORMATION [Condensed Consolidated Financial Statements](index=5&type=section&id=ITEM%201.%20Condensed%20Consolidated%20Financial%20Statements) Heron Therapeutics' unaudited condensed consolidated financial statements as of June 30, 2025, reflect total assets of **$232.1 million**, a **$27.3 million** stockholders' deficit, and a **$0.3 million** net income for the six months, a significant improvement from the prior year [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, cash and equivalents decreased to **$40.6 million**, total assets were **$232.1 million**, and the stockholders' deficit improved to **$27.3 million**, with liabilities reclassified due to maturity Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $16,516 | $25,802 | | Short-term investments | $24,117 | $33,481 | | Inventory, net | $72,965 | $53,160 | | Total current assets | $210,923 | $209,014 | | Total assets | $232,090 | $233,147 | | **Liabilities & Stockholders' Deficit** | | | | Total current liabilities | $258,601 | $91,457 | | Total liabilities | $259,348 | $266,798 | | Total stockholders' deficit | $(27,258) | $(33,651) | [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For Q2 2025, net product sales increased to **$37.2 million**, with net loss narrowing to **$2.4 million**; for the six months, sales grew to **$76.1 million**, achieving a **$0.3 million** net income from a prior-year loss Statement of Operations Summary (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Net product sales | $37,200 | $36,024 | $76,103 | $70,694 | | Gross profit | $27,343 | $25,506 | $57,789 | $51,732 | | Total operating expenses | $28,980 | $31,951 | $56,272 | $62,975 | | (Loss) income from operations | $(1,637) | $(6,445) | $1,517 | $(11,243) | | Net (loss) income | $(2,381) | $(9,235) | $254 | $(12,395) | | Diluted net (loss) income per share | $(0.02) | $(0.06) | $0.00 | $(0.08) | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash used in operating activities increased to **$19.7 million**, resulting in a **$9.3 million** net decrease in cash, ending the period with **$16.5 million** Cash Flow Summary for the Six Months Ended June 30 (in thousands) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(19,738) | $(14,120) | | Net cash provided by investing activities | $9,607 | $3,326 | | Net cash provided by financing activities | $845 | $503 | | **Net decrease in cash and cash equivalents** | **$(9,286)** | **$(10,291)** | | Cash and cash equivalents at end of period | $16,516 | $18,386 | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail business, liquidity, and accounting policies, highlighting the August 2025 refinancing that addressed debt and provided working capital, and significant customer revenue concentration - In August 2025, the company executed refinancing transactions, including a new credit facility and convertible notes, retiring existing debt and providing additional working capital[29](index=29&type=chunk)[30](index=30&type=chunk)[97](index=97&type=chunk) Customer Concentration for Six Months Ended June 30, 2025 | Customer | % of Net Product Sales | % of Accounts Receivable | | :--- | :--- | :--- | | Customer A | 43.9% | 43.8% | | Customer B | 33.5% | 34.4% | | Customer C | 21.2% | 21.3% | | **Total** | **98.6%** | **99.5%** | Inventory Breakdown (in thousands) | Product | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | CINVANTI | $34,500 | $36,600 | | ZYNRELEF | $31,700 | $11,800 | | SUSTOL | $3,000 | $3,200 | | APONVIE | $3,800 | $1,600 | | **Total** | **$72,965** | **$53,160** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=ITEM%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, highlighting a **70.5% increase in Acute Care sales** and a turnaround to **$1.5 million income from operations** for the six months, with sufficient liquidity [Overview](index=24&type=section&id=Overview) Heron is a commercial-stage biotechnology company with Acute Care (ZYNRELEF, APONVIE) and Oncology Care (CINVANTI, SUSTOL) portfolios, utilizing proprietary Biochronomer Technology - The company's portfolio is divided into two main categories: Acute Care (ZYNRELEF, APONVIE) and Oncology Care (CINVANTI, SUSTOL)[109](index=109&type=chunk)[110](index=110&type=chunk)[116](index=116&type=chunk) - ZYNRELEF has received expanded FDA indications and benefits from CMS pass-through status and the NOPAIN Act, providing separate Medicare reimbursement in outpatient and ambulatory surgical center settings from 2025 through 2027[111](index=111&type=chunk)[113](index=113&type=chunk) [Results of Operations](index=27&type=section&id=Results%20of%20Operations) For the six months ended June 30, 2025, total net product sales increased by **7.6% to $76.1 million**, driven by **70.5% Acute Care growth**, with improved gross profit margin and decreased operating expenses Net Product Sales by Segment (in thousands) | Segment | Six Months 2025 | Six Months 2024 | % Change | | :--- | :--- | :--- | :--- | | Acute Care | $20,954 | $12,290 | +70.5% | | Oncology | $55,149 | $58,404 | -5.6% | | **Total** | **$76,103** | **$70,694** | **+7.6%** | - Gross profit margin for the first six months of 2025 increased to **75.9%** from **73.2%**, driven by higher units sold and lower inventory write-offs[133](index=133&type=chunk)[134](index=134&type=chunk) - Operating expenses for the six months ended June 30, 2025, decreased significantly due to lower personnel costs and reduced property and equipment write-offs[137](index=137&type=chunk)[139](index=139&type=chunk)[141](index=141&type=chunk) [Liquidity and Capital Resources](index=29&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, the company held **$40.6 million** in cash and equivalents; management believes post-refinancing, capital is sufficient for the next twelve months - The company had an accumulated deficit of **$1.9 billion** as of June 30, 2025[144](index=144&type=chunk) - Management asserts that following the August 2025 Refinancing Transactions, cash and equivalents are sufficient to fund operations for at least one year[145](index=145&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=30&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) There have been no material changes to the company's market risk disclosures since its 2024 Annual Report - There are no material changes to the company's market risk disclosures during the three and six months ended June 30, 2025[152](index=152&type=chunk) [Controls and Procedures](index=30&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2025, with no material changes in internal control - Management concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by this report[153](index=153&type=chunk) - No changes occurred in internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, internal controls[155](index=155&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=31&type=section&id=ITEM%201.%20Legal%20Proceedings) The company provides an update on patent litigation, settling with Mylan for generic CINVANTI and APONVIE licenses starting June 2032, with ongoing infringement cases against Slayback/Azurity and Qilu - The company settled patent litigation with Mylan on May 6, 2025, granting Mylan a license to market generic versions of CINVANTI and APONVIE in the U.S. beginning June 1, 2032[158](index=158&type=chunk)[159](index=159&type=chunk) - Patent infringement litigation is ongoing against Slayback/Azurity regarding a generic version of CINVANTI, with a bench trial scheduled for November 17, 2025[160](index=160&type=chunk)[161](index=161&type=chunk) - The company has initiated patent infringement lawsuits against Qilu Pharmaceutical for its ANDA filings for generic versions of both APONVIE and CINVANTI; a bench trial for these consolidated cases is scheduled for November 16, 2026[163](index=163&type=chunk)[164](index=164&type=chunk)[165](index=165&type=chunk) [Risk Factors](index=32&type=section&id=ITEM%201A.%20Risk%20Factors) The company highlights key risks, including reliance on single-source suppliers, potential negative impacts from government policy changes, and persistent pressure on product pricing and reimbursement - The company relies on single vendors for some critical materials and components, creating risk of supply chain interruption due to geopolitical instability, natural disasters, or other disruptions[167](index=167&type=chunk)[168](index=168&type=chunk) - Changes in government policies, laws, and regulations, including layoffs at agencies like the FDA, potential government shutdowns, and shifts in trade policy, could negatively impact operations and increase costs[169](index=169&type=chunk)[172](index=172&type=chunk) - The company faces significant risk from healthcare cost-containment efforts, including potential changes to reimbursement levels and drug pricing reforms like the Inflation Reduction Act, which could limit revenue and profitability[174](index=174&type=chunk)[181](index=181&type=chunk)[183](index=183&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=37&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities during the period - None[190](index=190&type=chunk) [Other Information](index=37&type=section&id=ITEM%205.%20Other%20Information) No new Rule 10b5-1 trading plans were adopted or terminated by directors or executive officers during Q2 2025 - No directors or executive officers adopted or terminated any Rule 10b5-1 trading arrangements during the three months ended June 30, 2025[193](index=193&type=chunk) [Exhibits](index=38&type=section&id=ITEM%206.%20Exhibits) This section lists the exhibits filed as part of the Quarterly Report on Form 10-Q, including amendments and officer certifications

[Company Announcement & Executive Summary](index=1&type=section&id=Company%20Announcement%20%26%20Executive%20Summary) [Q2 2025 Financial Results and Commercial Progress](index=1&type=section&id=Q2%202025%20Financial%20Results%20and%20Commercial%20Progress) Heron Therapeutics announced Q2 2025 results, highlighting strong core product expansion and capital restructuring for enhanced financial flexibility - Heron Therapeutics announced its financial results and recent corporate updates for the three and six months ended June 30, 2025[3](index=3&type=chunk) - The company completed a comprehensive capital restructuring, reducing total debt from **$175 million** to **$145 million** and extending debt maturities to at least 2030, enhancing financial flexibility to support growth[6](index=6&type=chunk) [CEO Commentary](index=1&type=section&id=CEO%20Commentary) CEO Craig Collard stated the company enters Q3 with strong momentum, focusing on accelerating core product expansion and driving sustainable growth for stakeholders - CEO Craig Collard stated the company enters Q3 with **strong momentum**, clearly focused on accelerating core product expansion[4](index=4&type=chunk) - The company is committed to executing strategic priorities, driving sustainable growth, and creating long-term value for stakeholders[4](index=4&type=chunk) [Financial Performance and Outlook](index=1&type=section&id=Financial%20Performance%20and%20Outlook) [2025 Financial Guidance](index=1&type=section&id=2025%20Financial%20Guidance) Heron Therapeutics reaffirmed 2025 net revenue guidance and raised Adjusted EBITDA guidance, reflecting confidence in future performance Full-Year 2025 Net Revenue and Adjusted EBITDA Guidance (Millions of US Dollars) | Item | Original | Q1 Updated Guidance | Q2 Updated Guidance | | :--- | :--- | :--- | :--- | | Net Revenue | $153.0 to $163.0 | | | | Adjusted EBITDA | $0 - $8.0 | $4.0 - $12.0 | $9.0 - $13.0 | - Reaffirmed 2025 net revenue guidance of **$153 million to $163 million**[6](index=6&type=chunk) - Raised full-year 2025 Adjusted EBITDA guidance from **$4 million-$12 million** to **$9 million-$13 million**[6](index=6&type=chunk) [Key Financial Highlights](index=1&type=section&id=Key%20Financial%20Highlights) The company reported strong Q2 2025 net revenue and record year-to-date Adjusted EBITDA, with significant acute care growth Q2 2025 and Year-to-Date Key Financial Data | Metric | Q2 2025 | YTD 2025 | | :--- | :--- | :--- | | Net Revenue | $37.2 million | $76.1 million | | Adjusted EBITDA | - | $7.9 million (record) | - Acute Care franchise revenue grew **55.5%** year-over-year in Q2 2025 and **70.5%** year-over-year for the first half[7](index=7&type=chunk) - ZYNRELEF unit demand increased **6.3%** quarter-over-quarter in Q2 2025[6](index=6&type=chunk)[7](index=7&type=chunk) - APONVIE unit demand increased **19%** quarter-over-quarter in Q2 2025[6](index=6&type=chunk)[7](index=7&type=chunk) - Cash, cash equivalents, and short-term investments totaled **$40.6 million** as of June 30, 2025[7](index=7&type=chunk) [Net Revenue Performance](index=3&type=section&id=Net%20Revenue%20Performance) This section details the company's Q2 and H1 2025 net revenue by product line, showing strong acute care growth and oncology product decline [Three Months Ended June 30](index=3&type=section&id=Three%20Months%20Ended%20June%2030) Total net revenue for Q2 2025 increased **3.3%** to **$37.2 million**, driven by **55.5%** acute care growth and a **9.0%** decline in oncology products Net Revenue Performance for the Three Months Ended June 30 (Thousands of US Dollars) | | 2025 | 2024 | Dollar Change | Percentage Change | | :--- | :--- | :--- | :--- | :--- | | Acute Care | $ 10,653 | $ 6,851 | $ 3,802 | 55.5% | | APONVIE | $ 2,464 | $ 1,020 | $ 1,444 | 141.6% | | ZYNRELEF | $ 8,189 | $ 5,831 | $ 2,358 | 40.4% | | Oncology | $ 26,547 | $ 29,173 | $ (2,626) | (9.0%) | | CINVANTI | $ 24,143 | $ 24,927 | $ (784) | (3.1%) | | SUSTOL | $ 2,404 | $ 4,246 | $ (1,842) | (43.4%) | | Total Net Revenue | $ 37,200 | $ 36,024 | $ 1,176 | 3.3% | [Six Months Ended June 30](index=3&type=section&id=Six%20Months%20Ended%20June%2030) Total net revenue for H1 2025 increased **7.7%** to **$76.1 million**, with **70.5%** acute care growth and a **5.6%** decline in oncology products Net Revenue Performance for the Six Months Ended June 30 (Thousands of US Dollars) | | 2025 | 2024 | Dollar Change | Percentage Change | | :--- | :--- | :--- | :--- | :--- | | Acute Care | $ 20,954 | $ 12,290 | $ 8,664 | 70.5% | | APONVIE | $ 4,724 | $ 1,446 | $ 3,278 | 226.7% | | ZYNRELEF | $ 16,230 | $ 10,844 | $ 5,386 | 49.7% | | Oncology | $ 55,149 | $ 58,404 | $ (3,255) | (5.6%) | | CINVANTI | $ 49,886 | $ 50,544 | $ (658) | (1.3%) | | SUSTOL | $ 5,263 | $ 7,860 | $ (2,597) | (33.0%) | | Total Net Revenue | $ 76,103 | $ 70,694 | $ 5,409 | 7.7% | [Consolidated Statements of Operations](index=7&type=section&id=Consolidated%20Statements%20of%20Operations) Heron Therapeutics reported a Q2 2025 net loss of **$2.381 million**, significantly narrowed, and achieved a net income of **$0.254 million** for H1, reversing the prior year's loss Consolidated Statements of Operations Key Data (Thousands of US Dollars, except per share amounts) | | Three Months Ended June 30, | | Six Months Ended June 30, | | :--- | :--- | :--- | :--- | | | 2025 | 2024 | 2025 | 2024 | | Net product sales | $ 37,200 | $ 36,024 | $ 76,103 | $ 70,694 | | Gross profit | $ 27,343 | $ 25,506 | $ 57,789 | $ 51,732 | | Total operating expenses | $ 28,980 | $ 31,951 | $ 56,272 | $ 62,975 | | Net (loss) income | $ (2,381) | $ (9,235) | $ 254 | $ (12,395) | | Basic net (loss) income per share | $ (0.02) | $ (0.06) | $ 0.00 | $ (0.08) | | Diluted net (loss) income per share | $ (0.02) | $ (0.06) | $ 0.00 | $ (0.08) | [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets were **$232.09 million**, with increased current liabilities due to note reclassification and improved stockholders' deficit Consolidated Balance Sheets Key Data (Thousands of US Dollars) | | June 30, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $ 16,516 | $ 25,802 | | Short-term investments | $ 24,117 | $ 33,481 | | Total current assets | $ 210,923 | $ 209,014 | | Total assets | $ 232,090 | $ 233,147 | | Total current liabilities | $ 258,601 | $ 91,457 | | Total liabilities | $ 259,348 | $ 266,798 | | Total stockholders' deficit | $ (27,258) | $ (33,651) | [U.S. GAAP to Non-GAAP Reconciliation: Adjusted EBITDA](index=9&type=section&id=U.S.%20GAAP%20to%20Non-GAAP%20Reconciliation%3A%20Adjusted%20EBITDA) The company achieved positive Adjusted EBITDA in Q2 and H1 2025, significantly improving year-over-year and reflecting enhanced operational efficiency Adjusted EBITDA Reconciliation (Thousands of US Dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, | | :--- | :--- | :--- | :--- | | | 2025 | 2024 | 2025 | 2024 | | Net (loss) income | $ (2,381) | $ (9,235) | $ 254 | $ (12,395) | | Other expense, net | 744 | 2,790 | 1,263 | 1,152 | | Depreciation | 611 | 641 | 1,162 | 1,330 | | Stock-based compensation | 2,797 | 4,570 | 5,308 | 7,945 | | Adjusted EBITDA | $ 1,771 | $ (1,234) | $ 7,987 | $ (1,968) | [Business and Product Updates](index=2&type=section&id=Business%20and%20Product%20Updates) [Acute Care Franchise Performance](index=2&type=section&id=Acute%20Care%20Franchise%20Performance) Heron's Acute Care franchise achieved strong year-over-year revenue growth in Q2 and H1 2025, driven by commercial execution and product adoption - Heron's Acute Care franchise revenue grew **55.5%** year-over-year in Q2 2025 and **70.5%** year-over-year for the first half[7](index=7&type=chunk) [ZYNRELEF Updates](index=2&type=section&id=ZYNRELEF%20Updates) ZYNRELEF unit demand grew **6.3%** in Q2 2025, with commercialization accelerated by sales team restructuring and a new permanent J-code from CMS - ZYNRELEF unit demand increased **6.3%** quarter-over-quarter in Q2 2025[6](index=6&type=chunk)[7](index=7&type=chunk) - Commercial plans include launching a restructured ZYNRELEF-dedicated sales team in Q3 2025 and enhancing distributor incentives for specific customers[7](index=7&type=chunk) - Transition to Vial Access Needle ("VAN") to be completed in Q3 2025 to optimize product preparation and handling[7](index=7&type=chunk) - CMS granted ZYNRELEF a permanent, product-specific J-code, effective October 1, 2025, to simplify reimbursement for hospitals and ambulatory surgical centers[7](index=7&type=chunk) - ZYNRELEF is the first and only extended-release dual-acting local anesthetic proven in Phase III studies to significantly reduce pain and increase the proportion of opioid-free patients for up to 72 hours post-surgery[12](index=12&type=chunk) [APONVIE Updates](index=2&type=section&id=APONVIE%20Updates) APONVIE unit demand grew **19%** in Q2 2025 due to hospital adoption, with a dedicated sales team launched to expand its PONV prevention market share - APONVIE unit demand increased **19%** quarter-over-quarter in Q2 2025[6](index=6&type=chunk)[7](index=7&type=chunk) - A dedicated sales team launched July 1 to focus on APONVIE promotion, leveraging recent access gains to cover approximately **4 million** annual surgical patients in the U.S. at moderate-to-high risk for postoperative nausea and vomiting[7](index=7&type=chunk) - APONVIE is a Substance P/Neurokinin-1 (NK1) Receptor Antagonist (RA) indicated for the prevention of postoperative nausea and vomiting (PONV) in adults[14](index=14&type=chunk) [CINVANTI Product Information](index=4&type=section&id=CINVANTI%20Product%20Information) CINVANTI is an intravenous NK1 receptor antagonist, used with other antiemetics for preventing acute and delayed nausea and vomiting from cancer chemotherapy - CINVANTI, in combination with other antiemetics, is indicated for the prevention of acute and delayed nausea and vomiting associated with highly emetogenic cancer chemotherapy (HEC) and moderately emetogenic cancer chemotherapy (MEC) in adults[16](index=16&type=chunk) - CINVANTI is an intravenous formulation of aprepitant, the first intravenous formulation to directly deliver aprepitant, the active ingredient in EMEND® capsules[16](index=16&type=chunk) [SUSTOL Product Information](index=5&type=section&id=SUSTOL%20Product%20Information) SUSTOL is an extended-release injectable 5-HT3 receptor antagonist, using Biochronomer® technology, for preventing acute and delayed nausea and vomiting from chemotherapy - SUSTOL, in combination with other antiemetics, is indicated for the prevention of acute and delayed nausea and vomiting associated with moderately emetogenic chemotherapy (MEC) or anthracycline and cyclophosphamide (AC) combination chemotherapy regimens in adults[18](index=18&type=chunk) - SUSTOL is an extended-release injectable 5-HT3 receptor antagonist, utilizing Heron's Biochronomer® drug delivery technology, maintaining therapeutic levels of granisetron for at least 5 days[18](index=18&type=chunk) [Corporate Information and Disclosures](index=4&type=section&id=Corporate%20Information%20and%20Disclosures) [Conference Call and Webcast](index=4&type=section&id=Conference%20Call%20and%20Webcast) Heron Therapeutics will host a conference call and webcast on August 8, 2025, at 8:30 AM ET to discuss company results and provide details - Heron will host a conference call and webcast on Friday, August 8, 2025, at **8:30 AM ET**[11](index=11&type=chunk) - Conference call dial-in details are available via a registration link, and the webcast can be accessed on the Investor Relations section of Heron's website[11](index=11&type=chunk) [About Heron Therapeutics, Inc.](index=5&type=section&id=About%20Heron%20Therapeutics%2C%20Inc.) Heron Therapeutics, Inc. is a commercial-stage biotechnology company focused on developing therapeutic innovations to improve patient lives in acute care and oncology - Heron Therapeutics, Inc. is a commercial-stage biotechnology company focused on improving patient lives through the development and commercialization of therapeutic innovations[20](index=20&type=chunk) - The company leverages advanced science, proprietary technologies, and innovative approaches to deliver a portfolio of products for acute care and oncology patients[20](index=20&type=chunk) [Non-GAAP Financial Measures Explanation](index=5&type=section&id=Non-GAAP%20Financial%20Measures%20Explanation) The company uses non-GAAP financial measures like Adjusted EBITDA to supplement GAAP results, providing insights into operational activities, with detailed definitions and limitations - The company uses non-GAAP financial measures, such as Adjusted EBITDA, to supplement GAAP results, providing insights into normal operating activities[21](index=21&type=chunk)[22](index=22&type=chunk) - Adjusted EBITDA is a non-GAAP financial measure representing GAAP net income or loss, adjusted for interest expense, interest income, income tax benefit or provision, depreciation, amortization, stock-based compensation expense, and other adjustments not representative of ongoing operations[23](index=23&type=chunk) - Adjusted EBITDA has limitations, such as excluding depreciation and amortization, stock-based compensation expense, working capital requirements, income taxes, and cash requirements for capital expenditures or contractual commitments[24](index=24&type=chunk)[25](index=25&type=chunk) - Adjusted Operating Expenses is a non-GAAP financial measure representing GAAP operating expenses, adjusted for stock-based compensation expense, depreciation and amortization, and other adjustments not representative of ongoing operations[26](index=26&type=chunk) [Forward-looking Statements](index=6&type=section&id=Forward-looking%20Statements) This press release contains forward-looking statements based on management's expectations, subject to risks and uncertainties that could cause actual results to differ materially - This press release contains “forward-looking statements” based on management’s expectations and assumptions, subject to risks and uncertainties that could cause actual results to differ materially[27](index=27&type=chunk) - Examples of forward-looking statements include potential market opportunities for ZYNRELEF, APONVIE, CINVANTI, and SUSTOL, financial guidance, potential market opportunities for ZYNRELEF label expansion, and outcomes of the company’s patent litigation[27](index=27&type=chunk) - Important risk factors are detailed in the company’s latest Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q, and other reports filed with the U.S. Securities and Exchange Commission[27](index=27&type=chunk) [Investor Relations and Media Contact](index=10&type=section&id=Investor%20Relations%20and%20Media%20Contact) This section provides detailed contact information for Heron Therapeutics' Investor Relations and Media Contact for further communication - Investor Relations and Media Contact: Ira Duarte, Executive Vice President, Chief Financial Officer[34](index=34&type=chunk) - Contact: iduarte@herontx.com, 858-251-4400[34](index=34&type=chunk)

Core Insights - Heron Therapeutics reported strong financial results for Q2 2025, with net revenue of $37.2 million and year-to-date revenue of $76.1 million, reaffirming its 2025 net revenue guidance of $153 million to $163 million [7][3] - The company achieved record year-to-date adjusted EBITDA of $7.9 million, raising its full-year adjusted EBITDA guidance from $4.0 million - $12.0 million to $9.0 million - $13.0 million [7][3] - The company is focused on expanding its core products, particularly ZYNRELEF and APONVIE, with significant unit demand growth reported [8][7] Financial Performance - Q2 2025 net revenue increased by 3.3% compared to Q2 2024, with total net revenue reaching $37.2 million [9] - Year-to-date net revenue for the first half of 2025 was $76.1 million, reflecting a 7.7% increase from $70.7 million in the same period of 2024 [10] - The Acute Care franchise saw a year-over-year revenue growth of 55.5% in Q2 2025 and 70.5% for the first half of 2025 [8] Product Updates - ZYNRELEF unit demand grew by 6.3% in Q2 2025 compared to Q1 2025, with plans for expanded commercial initiatives in Q3 2025 [8] - APONVIE unit demand increased by 19% in Q2 2025 compared to Q1 2025, supported by increased adoption in hospital systems [8] - The Centers for Medicare and Medicaid Services granted a permanent J-code for ZYNRELEF, effective October 1, 2025, which will streamline reimbursement processes [8] Debt and Financial Flexibility - The company completed a comprehensive capital restructuring, reducing total debt from $175 million to $145 million and extending debt maturities to at least 2030 [7] - As of June 30, 2025, cash, cash equivalents, and short-term investments totaled $40.6 million [8] Management Commentary - The CEO emphasized the company's commitment to executing strategic priorities and driving sustainable growth, reflecting the dedication of the team and the growing demand for innovative solutions [2]

Core Viewpoint - Heron Therapeutics has completed a comprehensive capital restructuring aimed at enhancing financial flexibility, reducing total debt, and supporting long-term growth [1][2] Financial Restructuring Details - The refinancing transaction includes a new senior credit facility with Hercules Capital providing $110 million in committed capital and an additional $40 million available upon achieving certain milestones [6] - An exchange agreement was made to retire approximately $125 million in cash and convert $25 million of existing senior convertible notes into common stock [6] - The company issued $35 million of new 5% senior convertible notes due in 2031 and conducted a private placement for $27.7 million in gross proceeds through common and preferred equity [6] Management Commentary - The CEO of Heron emphasized that the refinancing strengthens the balance sheet, eliminates near-term debt maturities, and supports commercial execution and pipeline priorities [2] Upcoming Events - Heron will host a conference call and live webcast on August 8, 2025, to discuss the restructuring and its implications [4]

Core Viewpoint - Heron Therapeutics, Inc. will host a conference call on August 11, 2025, to report its second quarter 2025 financial results and discuss recent business highlights [1]. Group 1: Conference Call Details - The conference call is scheduled for August 11, 2025, at 4:30 p.m. ET [1]. - Participants can access the call via a registration link for dial-in details and are encouraged to join fifteen minutes early [2]. - The call will also be available as a webcast on Heron's website, with an archive accessible for 60 days post-call [2]. Group 2: Company Overview - Heron Therapeutics is a commercial-stage biotechnology company focused on developing therapeutic innovations to improve patient care [3]. - The company utilizes advanced science, patented technologies, and an innovative approach to drug discovery and development [3]. - Heron aims to advance the standard-of-care for acute care and oncology patients through its portfolio of products [3].