Core Insights - Heron Therapeutics reported strong financial results for Q1 2025, achieving record adjusted EBITDA and significant revenue growth driven by its acute care products, particularly ZYNRELEF [2][6][7]. Financial Performance - The company generated net revenue of $38.9 million in Q1 2025, a 12.2% increase compared to Q1 2024 [6][7]. - Adjusted EBITDA for Q1 2025 was $6.2 million, a significant improvement from a loss of $734,000 in Q1 2024 [6][27]. - The acute care segment saw a revenue increase of 89.4%, with ZYNRELEF contributing $8.0 million, up 60.4% from the previous year [5][7]. Business Highlights - The company reached a settlement with Mylan Pharmaceuticals regarding patent litigations for CINVANTI and APONVIE, allowing Mylan to market generics starting June 1, 2032 [6][7]. - The Non-Opioid Policy for Pain Relief, effective April 1, 2025, provides separate payment for non-opioids like ZYNRELEF, enhancing market opportunities [7]. - The launch of the Vial Access Needle (VAN) for ZYNRELEF is progressing well, improving operational efficiency in surgical settings [7]. Financial Guidance - For the full year 2025, the company updated its guidance for net revenue to a range of $153 million to $163 million and adjusted EBITDA to $4 million to $12 million [3][6]. Cash Position - As of March 31, 2025, the company had cash, cash equivalents, and short-term investments totaling $50.7 million [7]. Product Information - ZYNRELEF is the first extended-release dual-acting local anesthetic approved for postoperative pain management, demonstrating significant efficacy in reducing pain and opioid use [9]. - APONVIE is indicated for the prevention of postoperative nausea and vomiting, showing bioequivalence to oral aprepitant [11]. - CINVANTI is used for preventing chemotherapy-induced nausea and vomiting, with a unique IV formulation [13]. - SUSTOL is indicated for the prevention of nausea and vomiting associated with chemotherapy, utilizing a novel drug delivery technology [15].

Core Viewpoint - Heron Therapeutics has entered into a settlement agreement with Mylan Pharmaceuticals to resolve patent litigations, allowing Mylan to market generic versions of CINVANTI® and APONVIE® starting June 1, 2032, or earlier under certain conditions [1][2]. Group 1: Settlement Agreement Details - The settlement resolves ongoing patent litigations initiated by Heron in September 2023 and January 2024 against Mylan's applications for generic versions of CINVANTI® and APONVIE® [2]. - Mylan will receive a license under the Heron Patents to market the generic drugs in the U.S. [1][2]. Group 2: Company Background - Heron Therapeutics is a commercial-stage biotechnology company focused on developing therapeutic innovations to improve patient care, particularly in acute care and oncology [3]. - The company utilizes advanced science and patented technologies to create and commercialize a portfolio of products aimed at enhancing the standard of care [3].

Core Insights - Heron Therapeutics, Inc. has appointed Mark Hensley as Chief Operating Officer, bringing over fifteen years of experience in the pharmaceutical industry [1][2] - The CEO of Heron, Craig Collard, expressed confidence in Hensley's ability to drive operational efficiency and support the company's growth initiatives [2] - Hensley previously held senior leadership roles at Veloxis Pharmaceuticals, including CEO and COO, and has a strong background in sales and operations [2] Compensation and Inducement Awards - As part of his employment, Hensley will receive inducement awards including a non-statutory stock option for 500,000 shares, 500,000 restricted stock units, and a performance-based stock option for up to 900,000 shares [3] - The inducement options have a 10-year term with a four-year vesting schedule, with 25% vesting on the first anniversary and the remainder vesting monthly over the next three years [3] - The performance-based stock option vests based on achieving certain stock price goals during Hensley's employment [3] Company Overview - Heron Therapeutics is a commercial-stage biotechnology company focused on developing and commercializing therapeutic innovations to improve patient care [4] - The company utilizes advanced science and patented technologies to create a portfolio of products aimed at enhancing the standard of care for acute care and oncology patients [4]

Company Overview - Heron Therapeutics, Inc. is a commercial-stage biotechnology company focused on developing and commercializing therapeutic innovations to improve medical 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] Upcoming Events - The company will host a conference call and live webcast on May 6, 2025, at 8:00 a.m. ET to report first quarter 2025 financial results and discuss recent business highlights [1] - Participants can access the conference call via a registration link and are encouraged to join fifteen minutes early to avoid delays [2] - An archive of the teleconference and webcast will be available on Heron's website for 60 days following the call [2]

Financial Data and Key Metrics Changes - The company achieved a net income of $3.6 million for Q4 2024 and a full-year net revenue of $144.2 million, reflecting a 14% year-over-year increase [10][11] - Adjusted EBITDA for the full year 2024 was $8.6 million, with gross margin improving from 49% to approximately 73% [12][20] - Operating expenses have been reduced by over $80 million since 2022, ending 2024 with a cash balance of just over $59 million [13][24] Business Line Data and Key Metrics Changes - CINVANTI net revenues rebounded to $26.9 million in Q4 2024 from $22.7 million in Q3 2024, with full-year revenues exceeding $100 million [11][12] - ZYNRELEF achieved record net revenues of $8.5 million in Q4 2024, a 33% increase from $6.3 million in Q3 2024 [11][12] - The Oncology franchise, including CINVANTI and SUSTOL, continues to show growth despite increased competition [14] Market Data and Key Metrics Changes - APONVIE and ZYNRELEF saw significant growth, up over 310% and 48% respectively in Q4 2024 compared to the same period last year [15] - The company anticipates continued growth in 2025 as it expands product usage within hospital institutions [16] Company Strategy and Development Direction - The management team has focused on repositioning the business for future growth and achieving profitability by Q4 2024 [8] - The company secured inclusion in the NOPAIN Act, expanding reimbursement for ZYNRELEF, and launched the vial access needle (VAN) to improve product preparation time [9][10] - The CrossLink partnership has been integrated, with over 800 distributor representatives focused on the orthopedic space [8] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about ZYNRELEF's growth potential, especially with the upcoming full implementation of the NOPAIN Act [45] - The company is taking a conservative approach to CINVANTI's outlook due to increased competition and potential pressure on average selling prices [14][38] - Management expects some lumpiness in cash flow and adjusted EBITDA in early 2025 due to legal expenses and other factors [37] Other Important Information - The company incurred inventory write-offs of $2.5 million and asset impairment write-offs of $2.2 million in 2024 [25] - The launch of the 200 mg VAN is expected around April 2025, which is anticipated to further enhance sales [34][60] Q&A Session Summary Question: ZYNRELEF's performance in the quarter - Management confirmed no significant stocking issues and noted that inventory levels were low, with positive reception to the VAN [30][31] Question: Cash flow and adjusted EBITDA expectations - Management indicated that cash flow may be a bit lumpy in early 2025 due to legal expenses but overall results are expected to remain stable [37] Question: Drivers of ZYNRELEF's momentum - Management highlighted the CrossLink partnership and the upcoming NOPAIN Act implementation as key drivers of momentum for ZYNRELEF [49][50] Question: Expectations for ZYNRELEF in Q1 - Management anticipates continued growth in Q1, with daily average sales higher than in Q4, despite seasonal factors [60] Question: Update on the peripheral syringe for ZYNRELEF - The company is pleased with the VAN rollout and expects to launch the prefilled syringe by late 2026 or early 2027 [76]

Core Insights - Heron Therapeutics reported revenue of $40.78 million for Q4 2024, marking a year-over-year increase of 19.1% and exceeding the Zacks Consensus Estimate of $36.95 million by 10.37% [1] - The company achieved an EPS of $0.02, a significant improvement from -$0.07 a year ago, resulting in an EPS surprise of 166.67% compared to the consensus estimate of -$0.03 [1] Financial Performance - Net Product Sales for the Oncology Care Franchise (Sustol) were $3.52 million, slightly above the estimated $3.38 million, but a decrease of 7.4% year-over-year [4] - Net Product Sales for the Acute Care Franchise (Aponvie) reached $1.93 million, significantly surpassing the estimated $1.43 million, reflecting a year-over-year increase of 311.1% [4] - Net Product Sales for the Acute Care Franchise (Zynrelef) totaled $8.46 million, exceeding the average estimate of $6.88 million, with a year-over-year growth of 48.5% [4] - Net Product Sales for the Oncology Care Franchise (Cinvanti) amounted to $26.87 million, above the estimated $25.40 million, representing a year-over-year increase of 10.7% [4] Market Performance - Shares of Heron Therapeutics have returned +2.4% over the past month, contrasting with the Zacks S&P 500 composite's decline of -2.2% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Financial Data and Key Metrics Changes - The company achieved a net income of $3,600,000 for Q4 2024 and net revenues of $144,200,000 for the full year, reflecting a 14% year-over-year increase [8][14] - Adjusted EBITDA for the full year was $8,600,000, with gross margin improving from 48.8% to approximately 73% [9][14] - Operating expenses have been reduced by over $80,000,000 since 2022, with cash balance at the end of 2024 exceeding $59,000,000 [10][14] Business Line Data and Key Metrics Changes - Cinvanti net revenues rebounded to $26,900,000 in Q4 from $22,700,000 in Q3, with full-year revenues exceeding $100,000,000 [8][9] - Zenerife achieved record net revenues of $8,500,000 in Q4, a 33% increase from Q3 [9] - The oncology franchise, including Cymbanti and Sustol, continues to show growth despite competition, with Cymbanti generating approximately $100,000,000 in net revenues for 2024 [10][11] Market Data and Key Metrics Changes - The acute hospital segment saw significant growth, with APONAVY and ZENOLAF increasing over 31048% in Q4 compared to the same period last year [11] - Daily unit sales for ZinnerLab are steadily increasing, with onboarding of new accounts at a faster rate [12] Company Strategy and Development Direction - The company aims to achieve profitability and has successfully expanded product labeling for XENOLF, doubling the number of approved procedures [5][6] - The CrossLink partnership has been integrated, focusing on the orthopedic space with over 800 distributor representatives [6][10] - The company is taking a conservative approach to Cymbanti's outlook for 2025 due to increased competition and potential pressure on average selling prices [10][28] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth trajectory for 2025, particularly with the launch of the VAN and the No Pain Act, which expands reimbursement for Zener Lev [6][11] - The company anticipates continued growth in unit sales, although it may come at lower price points due to market dynamics [10][28] Other Important Information - The U.S. District Court ruled in favor of the company in a patent lawsuit against Fresenius Kabi, upholding the validity of the Symvante patents [8] - The company incurred inventory write-offs of $2,500,000 and asset impairment write-offs of $2,200,000 during the year [14] Q&A Session Summary Question: Any updates on Zenerleaf's performance and future expectations? - Management confirmed no significant stocking issues and noted that the reception of the VAN has been exceptional, with at least 15 accounts returning or saved due to the launch [21][22] Question: How should cash flow and adjusted EBITDA be viewed on a quarterly basis? - Management indicated that there may be some lumpiness in cash flow due to legal expenses and other factors, but overall results are expected to remain stable [27] Question: What is driving the momentum for ZINRILOF? - The CrossLink relationship is contributing significantly, with accounts growing at a higher rate when overlapping with CrossLink representatives [36][37] Question: Expectations for OpEx in 2025? - OpEx is expected to be slightly higher due to increased R&D spending and legal expenses, but overall, the remaining business will remain flat [39] Question: Any thoughts on Baker Brothers debt? - Management plans to meet with Baker Brothers soon to discuss options regarding the convertible debt, especially after resolving litigation uncertainties [48][50]

Revenue and Sales Performance - The company reported net product sales from ZYNRELEF, APONVIE, CINVANTI, and SUSTOL, with revenues dependent on various factors including market conditions and customer agreements [306]. - Net product sales for 2024 reached $144.3 million, a 13.6% increase from $127.0 million in 2023 [331]. - Acute care net product sales grew by 57.3% in 2024, driven by increased market share and the commercial launch of APONVIE in March 2023 [331]. - Total acute care net product sales increased by 87.5% in 2023 compared to 2022, indicating strong growth momentum [332]. Expenses and Cost Management - Research and development expenses primarily consist of salaries, stock-based compensation, and costs related to clinical and preclinical development, with all costs expensed in the period incurred [308]. - General and administrative expenses include salaries and related costs for various personnel functions, as well as professional fees for legal and corporate purposes [309]. - Sales and marketing expenses are focused on personnel costs and commercialization efforts related to the company's products [310]. - Research and development expenses decreased by 57.4% in 2024 to $16.7 million, primarily due to restructuring and reduced headcount [337]. - Operating expenses as a percentage of sales decreased across all categories in 2024, with sales and marketing expenses down 30.4% [341]. - Cost of product sales decreased by 40.6% in 2024, primarily due to reduced inventory reserves and improved production efficiency [334]. Financial Position and Cash Management - Cash, cash equivalents, and short-term investments totaled $59.3 million as of December 31, 2024, sufficient to meet anticipated cash requirements for at least one year [345]. - The company has $175.5 million in current indebtedness that will need to be refinanced to fully fund its business plan [345]. - The company invests in marketable securities to preserve capital, maintain liquidity, and maximize yields, with a focus on high credit quality financial institutions [357]. - The investment portfolio includes only marketable securities and instruments with active secondary markets to ensure liquidity [357]. - The company does not expect material impact on operating results from sudden interest rate changes, as it can hold fixed-income investments to maturity [357]. Risks and Economic Factors - The company faces significant risks from global business, political, and macroeconomic conditions, including financial market volatility and potential government shutdowns [304]. - Foreign currency exposure is primarily to fluctuations in the Euro, but the company does not anticipate significant transaction gains or losses at current operational levels [358]. - The company has not engaged in foreign currency hedging to date, and any gains or losses are included in the Consolidated Statements of Operations [358]. - Inflation has not materially impacted the company's business or results of operations during the reporting periods [359]. - Significant adverse changes in inflation could negatively impact future results of operations [359]. Profitability and Loss - The company reported a net loss of $13.6 million in 2024, a significant reduction from a net loss of $110.6 million in 2023 [346]. - Gross profit for 2024 was $105.6 million, significantly up from $61.9 million in 2023, reflecting improved cost management [330]. Revenue Recognition and Inventory Management - Revenue recognition follows the Financial Accounting Standards Board guidelines, ensuring that revenue reflects the transfer of goods or services to customers [316]. - The company monitors inventory levels and may write down obsolete inventory or inventory exceeding expected sales requirements [323]. - Stock-based compensation is estimated using the Black-Scholes model, with assumptions that could impact net loss and net loss per share if changed [327]. Agreements and Collaborations - A five-year co-promotion agreement was established with Crosslink Network to enhance the promotion of ZYNRELEF for orthopedic indications, with compensation based on growth over a predetermined baseline [305].

Financial Performance - Heron achieved Q4 2024 GAAP Net Income of $3.6 million, marking a significant milestone for the company[7]. - Full-year 2024 Net Revenue reached $144.2 million, representing a 14% increase year-over-year[7]. - ZYNRELEF generated Q4 2024 Net Revenue of $8.5 million, with a full-year revenue of $25.5 million, up 44.1% from 2023[7][9]. - Total Net Revenue for Q4 2024 was $40.8 million, a 19.1% increase compared to Q4 2023[10]. - Net product sales for Q4 2024 reached $40,781 million, a 19.5% increase from $34,233 million in Q4 2023[29]. - Gross profit for the twelve months ended December 31, 2024, was $105,637 million, compared to $61,939 million in 2023, reflecting a significant improvement[29]. - The net loss for Q4 2024 was $3,663 million, a substantial improvement from a net loss of $10,724 million in Q4 2023[29]. - Basic and diluted net income per share improved to $0.02 in Q4 2024, compared to a loss of $0.07 per share in Q4 2023[29]. Revenue Guidance and Expectations - The company expects 2025 Net Revenue guidance between $153.0 million and $163.0 million, with Adjusted EBITDA guidance ranging from $0.0 million to $8.0 million[5]. Product Performance - APONVIE's revenue surged by 224.8% year-over-year, reaching $4.5 million in 2024[9]. - Acute Care segment revenue increased by 57.3% year-over-year, totaling $30.1 million in 2024[9]. Market Expansion - The partnership with Crosslink Network is expected to enhance promotional efforts for ZYNRELEF in the orthopedic surgery market[8]. - Expanded label indications for ZYNRELEF now cover approximately 17 million annual targeted procedures, significantly increasing its market potential[8]. Cash and Assets - Cash, cash equivalents, and short-term investments totaled $59.3 million as of December 31, 2024[8]. - Cash and cash equivalents decreased to $25,802 million as of December 31, 2024, from $28,677 million in 2023[31]. - Accounts receivable increased to $78,881 million in 2024, up from $60,137 million in 2023, indicating higher sales volume[31]. - Total assets grew to $233,147 million in 2024, compared to $222,506 million in 2023, reflecting overall growth[31]. Liabilities and Deficits - Current liabilities increased to $91,457 million in 2024, up from $79,685 million in 2023, suggesting increased operational commitments[31]. - The accumulated deficit as of December 31, 2024, was $(1,919,594) million, slightly worsening from $(1,906,014) million in 2023[31]. Cost Management - Total operating expenses decreased to $117,165 million for the twelve months ended December 31, 2024, down from $172,554 million in 2023, indicating cost management efforts[29].

Core Insights - Heron Therapeutics reported a milestone year in 2024, achieving positive net income in Q4 and a full-year net revenue increase of 14% year-over-year, totaling $144.2 million [2][5][27] - The company is positioned for future growth with its product ZYNRELEF, which has expanded label indications and is expected to benefit from new promotional efforts and regulatory approvals [2][6] Financial Performance - Q4 2024 GAAP net income was $3.6 million, compared to a net loss of $10.7 million in Q4 2023 [5][27] - Full-year 2024 adjusted EBITDA was $8.6 million, with a total operating revenue of $144.3 million, up from $127.0 million in 2023 [5][27] - The company generated Q4 2024 net revenue of $40.8 million, a 19.1% increase from $34.2 million in Q4 2023 [8][27] Product Highlights - ZYNRELEF generated Q4 2024 net revenue of $8.5 million, with expanded indications covering approximately 17 million annual procedures [5][6] - The launch of the ZYNRELEF Vial Access Needle (VAN) is expected to simplify preparation and reduce withdrawal time significantly [6] - The U.S. District Court ruled in favor of Heron in a patent lawsuit, upholding the validity of CINVANTI patents, which expire in 2035 [5] Financial Guidance - For 2025, the company projects net revenue between $153 million and $163 million, with adjusted EBITDA ranging from $0 million to $8 million [3]