Theratechnologies(THTX)

Search documents
Theratechnologies(THTX) - 2022 Q4 - Earnings Call Transcript
2023-02-28 19:32
Financial Data and Key Metrics Changes - Consolidated revenues for Q4 2022 were $21.4 million, reflecting a 14.2% growth compared to Q4 2021 [35] - Annual revenues reached $80.1 million, representing approximately 15% growth in line with 2022 revenue guidance [35] - Net loss for Q4 2022 was $7.9 million, an improvement from $9.9 million in the same quarter last year [48] - The company anticipates revenues for full year 2023 to be between $90 million and $95 million, indicating growth of approximately 13% to 19% compared to 2022 revenues [10][46] Business Line Data and Key Metrics Changes - Trogarzo revenues in Q4 2022 were just shy of $7 million, up 16% from $6 million in the same period of 2021 [20] - EGRIFTA SV sales were $14.5 million in Q4 2022, up 13.4% from the same period last year [45] - R&D expenses amounted to $9.5 million in Q4 2022, compared to $8.7 million in the same quarter last year, largely due to higher spending in the oncology program [21] - Selling expenses decreased to $7.8 million in Q4 2022 from $8.2 million in the same period last year, attributed to exiting the European market [47] Market Data and Key Metrics Changes - The macro environment for biotechs has been challenging, with the sector losing an average of 40% of market value over the last 18 months [11] - The company noted a significant investor reaction to the pause in enrollment for the TH1902 Phase I clinical trials, which halved its market cap [11][12] Company Strategy and Development Direction - The company plans to focus on its growing commercial business and has built a strong team to drive growth [13] - There is an emphasis on exploring accretive opportunities from products that may no longer fit larger firms' portfolios, particularly in HIV or adjacent areas [15] - The company aims to achieve positive adjusted EBITDA by the end of the fiscal year through tight expense management and revenue growth [10][19] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the difficult operating environment for biotechs but expressed confidence in the company's strategic decisions and future revenue growth [11][19] - The company is optimistic about the potential for partnerships in the NASH program, citing a favorable shift in the market context [65] - Management reiterated the commitment to resume the TH1902 clinical trial with an improved protocol to increase the probability of success [18][38] Other Important Information - The company has entered into an agreement with the World Orphan Drug Alliance for the distribution of EGRIFTA SV into 41 countries [15] - The completion of several important projects is expected in the first half of 2023, including the development of the IM mode of administration of Trogarzo [23] Q&A Session Summary Question: Can you provide additional color on potential partners for Phase III NASH opportunity? - Management indicated that they are looking for global partnerships and have developed a protocol that satisfies both North American and European agencies [55] Question: How are you thinking about OpEx in relation to fourth quarter numbers? - Management stated that they intend to drive leverage P&L moving forward, with top-line growth expected to outpace expenses [66] Question: What would be required for the EGRIFTA SV HFS? - The HFS requires changes to the instruction for use, and the company is ready to conduct the study with timelines on track for mid-year submission [72] Question: What are the next steps for the development of the intra-muscular formulation of Trogarzo? - The trial has been completed, and the focus is on completing blood analysis and statistical analysis for FDA submission [75] Question: Can you expand on the potential new products adjacent to HIV? - The company is open to acquiring approved products that are deprioritized by larger firms, ideally in the rare disease space [79][80]
Theratechnologies(THTX) - 2022 Q3 - Earnings Call Transcript
2022-10-13 15:38
Financial Data and Key Metrics Changes - Consolidated revenue for Q3 2022 was $20.8 million, a 16.6% increase from $17.9 million in Q3 2021 [31] - Net loss for Q3 2022 was $7.5 million, improved from $9.5 million in the same period last year [38] - Cash position at the end of Q3 2022 was $36.5 million, sufficient to finance operations for at least the next 12 months [39] Business Line Data and Key Metrics Changes - EGRIFTA SV net sales reached $12.9 million in Q3 2022, up nearly 50% from $11.2 million in Q3 2021 [31] - Trogarzo net sales amounted to $7.9 million, a 20% increase from $6.6 million in Q3 2021, with a 26% growth in the U.S. [32] Market Data and Key Metrics Changes - Year-to-date U.S. revenue growth was a blended 18%, with Trogarzo revenues up 17% and EGRIFTA SV sales up 18% [19] Company Strategy and Development Direction - The company is focused on enhancing patient experiences through improved administration methods and new formulations, including the recent FDA approval for Trogarzo's 30-second IV push [9][10] - The company aims to unlock value in its legacy business by building its own sales teams and focusing on the U.S. market [8] - The SORT1+ oncology platform remains a key focus for future growth, with ongoing patient recruitment and trial advancements [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving revenue guidance of $79 million to $82 million for fiscal 2022, with expectations for continued growth in the new fiscal year [18][42] - The company is optimistic about the potential for its oncology programs and the NASH program, which remains on pause until a suitable partner is found [28][67] Other Important Information - The company secured a $100 million non-dilutive credit agreement, which alleviates financial burdens and supports commercial and pipeline development plans [20] - The company is conducting human factor studies for EGRIFTA SV and its FA formulation to improve patient adherence [15][17] Q&A Session Summary Question: Is the current SG&A a good run rate going forward? - Management confirmed that SG&A should remain generally in-line for the next couple of quarters [46] Question: Will the intramuscular formulation study for Trogarzo be sufficient for a supplementary BLA? - Management indicated that the study is similar to the IV push study, and they expect to submit to the FDA early next year after data analysis [47][50] Question: What is the annual locked price for EGRIFTA and Trogarzo? - EGRIFTA is approximately $6,500 per month, and Trogarzo is about $2,700 per two-week cycle [55] Question: What is the target enrollment for the TH1902 basket trial? - The target is 70 patients, with recruitment progressing well [60][61] Question: What is the status of partnership discussions for TH1902 in China? - Discussions are ongoing, and interest remains high as efficacy data becomes available [63] Question: What is the current status of the NASH program? - The program is on pause until a partner is found, but there is renewed interest in the NASH space [67][68] Question: How is the market for Trogarzo evolving? - Management noted that Trogarzo addresses a significant unmet need in multidrug-resistant HIV-1 infections, with a market size estimated around 2,000 patients annually [106][107]
Theratechnologies(THTX) - 2022 Q3 - Quarterly Report
2022-10-13 12:01
Revenue Performance - Revenue for the three-month period ended August 31, 2022, was $20,811,000, representing a 16.4% increase from $17,852,000 in the same period of 2021[5] - For the nine-month period ended August 31, 2022, revenue reached $58,636,000, up 14.5% from $51,069,000 in 2021[5] - EGRIFTA SV® net sales for the nine-month period ended August 31, 2022, were $35,996, up 18.2% from $30,256 in 2021[21] - Trogarzo® net sales for the nine-month period ended August 31, 2022, increased to $22,640, a 8.8% rise from $20,813 in 2021[21] - The company reported revenues of $58,636,000 for the nine-month period ended August 31, 2022, up from $51,069,000 in 2021, representing a growth of about 14.5%[55] Net Loss and Financial Performance - Net loss for the three-month period was $7,549,000, compared to a net loss of $9,510,000 in the same period of 2021, indicating a 20.5% improvement[5] - The company reported a total comprehensive loss of $38,639,000 for the nine-month period ended August 31, 2022, compared to a loss of $21,754,000 in the same period of 2021[5] - Basic and diluted loss per share for the nine-month period ended August 31, 2022, was $(0.41), compared to $(0.24) in the same period of 2021[5] - The company reported a net loss of $7,549 for the three-month period ended August 31, 2022, compared to a net loss of $9,510 in 2021, reflecting a 20.5% improvement[21] Assets and Liabilities - The total current assets decreased to $77,872,000 as of August 31, 2022, down from $91,908,000 as of November 30, 2021, a decline of 15.3%[3] - Total liabilities increased to $113,915,000 as of August 31, 2022, compared to $101,452,000 as of November 30, 2021, an increase of 12.3%[3] - The company’s equity deficiency as of August 31, 2022, was $(18,060,000), compared to an equity of $17,760,000 as of November 30, 2021[3] Cash Flow and Financing - The cash balance as of August 31, 2022, was $23,416,000, an increase from $20,399,000 as of November 30, 2021[3] - Cash flows used in operating activities for the nine-month period ended August 31, 2022, were $6,448, a decrease from $8,998 in 2021[21] - The company raised $40,000 from the issuance of a long-term loan during the three-month period ended August 31, 2022[21] - The company entered into a credit agreement for a loan facility of up to $100,000,000, with $40,000,000 funded on July 27, 2022, and additional tranches contingent on meeting specific revenue and regulatory milestones[28] - The long-term loan balance as of August 31, 2022, was $37,759,000 after accounting for transaction costs and accretion expenses[29] Expenses - Research and development expenses for the nine-month period were $27,484,000, up 40.2% from $19,596,000 in 2021[5] - The company recognized $6,356 in selling expenses related to the termination of Trogarzo® commercial operations in Europe[25] - The company recorded share-based compensation expense of $3,014,000 for the nine-month period ended August 31, 2022, compared to $1,493,000 in the same period of 2021[38] Stock and Options - As of August 31, 2022, the company had 5,023,249 stock options outstanding, with a weighted average exercise price of $3.98[38] - The average option life for options granted in 2022 was estimated at 9 years, with an expected volatility of 65.6%[39] - As of August 31, 2022, the company had 8,130,550 warrants outstanding, each entitling the holder to purchase one common share at an exercise price of $3.18 until January 19, 2024[35] - For the nine-month period ended August 31, 2022, the weighted average number of common shares was 95,124,851, compared to 91,430,847 in 2021, reflecting an increase of approximately 4.0%[42] Other Financial Information - The company incurred transaction costs of $3,612,000 related to the loan facility, with $2,285,000 allocated to the first tranche[29] - The fair value of the convertible unsecured senior notes was approximately $24,750,000 as of August 31, 2022, based on market quotes[53] - The company generated over 97% of its revenues from a single customer, RxCrossroads, indicating a high customer concentration risk[54] - The company has entered into an ATM program allowing it to sell up to $50 million of its common shares, although it has not drawn on this facility to date[46] - The company announced FDA approval for Trogarzo® for intravenous push administration, which may lead to additional cash-based milestones of $3,000,000 upon commercial sale[56] Provisions and Other Liabilities - As of August 31, 2022, the total provisions balance was $5,956,000, an increase from $4,123,000 as of November 30, 2021, reflecting a net increase of 44.5%[27]
Theratechnologies (THTX) Investor Presentation - Slideshow
2022-08-18 18:48
| --- | --- | --- | --- | |-------------------------|-------|------------------------|--------------------------------------------------------------| | | | | | | | | | | | | | | | | NASDAQ: THTX TSX: TH | | Clinically High Growth | Theratechnologies: Poised for Opportunities August 2022 | Forward-Looking Information 2 | --- | |-------------------------------------------------------------------------------------------------------------------------------------------------------| | | | The following presentati ...
Theratechnologies(THTX) - 2022 Q2 - Earnings Call Transcript
2022-07-14 17:42
Theratechnologies Inc. (NASDAQ:THTX) Q2 2022 Earnings Conference Call July 14, 2021 8:30 AM ET Company Participants Elif McDonald - Senior Director, Investor Relations Paul Levesque - President & CEO Philippe Dubuc - SVP & CFO Christian Marsolais - SVP & Chief Medical Officer John Mullaly - IR, LifeSci Advisors Conference Call Participants Edward Nash - Canaccord Genuity Andre Uddin - Research Capital Endri Leno - National Bank Operator Good morning and welcome to the Theratechnologies' Second Quarter Fisca ...
Theratechnologies(THTX) - 2022 Q2 - Quarterly Report
2022-07-14 12:00
[Interim Consolidated Financial Statements](index=1&type=section&id=Interim%20Consolidated%20Financial%20Statements) [Interim Consolidated Statements of Financial Position](index=3&type=section&id=Interim%20Consolidated%20Statements%20of%20Financial%20Position) As of May 31, 2022, Theratechnologies Inc. reported a significant decline in its financial position compared to November 30, 2021, with total assets decreasing from $119.2 million to $95.4 million and total liabilities rising from $101.5 million to $107.0 million, resulting in a shift from equity of $17.8 million to a deficiency of $11.6 million | Financial Position Highlights | May 31, 2022 ($'000) | November 30, 2021 ($'000) | Change ($'000) | | :--- | :--- | :--- | :--- | | **Total Current Assets** | 78,302 | 91,908 | (13,606) | | **Total Non-current Assets** | 17,057 | 27,304 | (10,247) | | **Total Assets** | **95,359** | **119,212** | **(23,853)** | | **Total Current Liabilities** | 49,923 | 45,076 | 4,847 | | **Total Non-current Liabilities** | 57,080 | 56,376 | 704 | | **Total Liabilities** | **107,003** | **101,452** | **5,551** | | **Total (Deficiency) Equity** | **(11,644)** | **17,760** | **(29,404)** | [Interim Consolidated Statements of Comprehensive Loss](index=4&type=section&id=Interim%20Consolidated%20Statements%20of%20Comprehensive%20Loss) For the six months ended May 31, 2022, revenue increased to $37.8 million from $33.2 million year-over-year, but a sharp rise in operating expenses, particularly selling expenses, led to a significantly wider loss from operating activities of $28.7 million and a net loss of $31.8 million, or ($0.33) per share | Income Statement Summary | Six-Months Ended May 31, 2022 ($'000) | Six-Months Ended May 31, 2021 ($'000) | YoY Change | | :--- | :--- | :--- | :--- | | **Revenue** | 37,825 | 33,217 | +13.9% | | Cost of Sales | 15,078 | 11,345 | +32.9% | | R&D Expenses | 19,059 | 11,300 | +68.7% | | Selling Expenses | 23,178 | 13,059 | +77.5% | | **Total Operating Expenses** | 66,506 | 43,150 | +54.1% | | **Loss from Operating Activities** | (28,681) | (9,933) | +188.7% | | **Net Loss** | (31,759) | (12,314) | +157.9% | | **Basic and Diluted Loss per Share** | ($0.33) | ($0.14) | +135.7% | [Interim Consolidated Statements of Changes in Equity](index=5&type=section&id=Interim%20Consolidated%20Statements%20of%20Changes%20in%20Equity) The company's equity position eroded significantly during the first six months of fiscal 2022, falling from $17.8 million at November 30, 2021, to a deficit of $11.6 million by May 31, 2022, primarily due to a net loss of $31.8 million | Equity Reconciliation (Six-Months Ended May 31, 2022) | Amount ($'000) | | :--- | :--- | | **Balance as at November 30, 2021** | **17,760** | | Net Loss | (31,759) | | Other Comprehensive Income | 161 | | Share-based Compensation | 2,194 | | **Balance as at May 31, 2022** | **(11,644)** | [Interim Consolidated Statements of Cash Flows](index=6&type=section&id=Interim%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended May 31, 2022, cash and cash equivalents decreased by $7.2 million to $13.2 million, with cash used in operating activities at $5.3 million, while financing activities shifted from providing $41.5 million in 2021 to using $2.2 million in 2022 | Cash Flow Summary | Six-Months Ended May 31, 2022 ($'000) | Six-Months Ended May 31, 2021 ($'000) | | :--- | :--- | :--- | | Cash flows used in operating activities | (5,252) | (5,944) | | Cash flows from (used in) financing activities | (2,163) | 41,542 | | Cash flows from (used in) investing activities | 222 | (10,199) | | **Net change in cash during the period** | **(7,193)** | **25,399** | | **Cash, beginning of period** | 20,399 | 12,737 | | **Cash, end of period** | **13,200** | **38,235** | [Notes to Interim Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Interim%20Consolidated%20Financial%20Statements) The notes provide detailed explanations for the financial statements, including accounting policies, revenue breakdown, significant operational changes, and subsequent events, such as a new $100 million loan facility secured after the reporting period [Note 3: Revenue](index=8&type=section&id=Note%203%3A%20Revenue) For the six months ended May 31, 2022, total net sales grew 13.9% year-over-year to $37.8 million, driven by increased sales of EGRIFTA SV® and Trogarzo®, with the United States remaining the dominant market at 98.3% of total sales | Net Sales by Product (Six-Months Ended May 31) | 2022 ($'000) | 2021 ($'000) | | :--- | :--- | :--- | | EGRIFTA SV® | 23,120 | 19,032 | | Trogarzo® | 14,705 | 14,185 | | **Total** | **37,825** | **33,217** | | Net Sales by Geography (Six-Months Ended May 31) | 2022 ($'000) | 2021 ($'000) | | :--- | :--- | :--- | | United States | 37,169 | 31,469 | | Europe | 511 | 1,461 | | Canada | 145 | 287 | | **Total** | **37,825** | **33,217** | [Note 5: Inventories, Prepaid Expenses, and Deposits](index=11&type=section&id=Note%205%3A%20Inventories%2C%20Prepaid%20Expenses%2C%20and%20Deposits) During the first half of 2022, the company recorded significant charges totaling over $3.3 million in cost of sales, including a $170,000 inventory write-down, a $2.3 million charge for cancelled EGRIFTA SV® production, and a $914,000 write-down of research supplies due to pausing its NASH trial - The company recorded several charges in the first half of 2022, including: - A **$170,000** write-down of inventories to net realizable value[25](index=25&type=chunk) - A **$2.3 million** charge for non-production of scheduled EGRIFTA SV® batches due to a planned transition to a new formulation[26](index=26&type=chunk) - A **$914,000** write-down of research supplies after pausing activities for its NASH trial[27](index=27&type=chunk) [Note 6: Commercial Operations in Europe](index=11&type=section&id=Note%206%3A%20Commercial%20Operations%20in%20Europe) On April 27, 2022, the company announced its strategic decision to cease commercial operations for Trogarzo® in Europe to focus on North America, resulting in a $6.36 million charge for accelerated amortization of European commercialization rights and anticipated further charges of approximately $1.5 million for termination expenses - The company is ceasing its Trogarzo® commercial operations in Europe to focus on North America[28](index=28&type=chunk) - As a result of this decision, the company recognized a **$6,356 thousand** expense to fully amortize the European commercialization rights for Trogarzo®[29](index=29&type=chunk) - An additional **$1,500 thousand** in charges related to severance and other termination expenses are expected to be recorded during 2022[29](index=29&type=chunk) [Note 8: Convertible Unsecured Senior Notes](index=12&type=section&id=Note%208%3A%20Convertible%20Unsecured%20Senior%20Notes) The carrying value of the company's convertible unsecured senior notes increased from $54.2 million at the end of fiscal 2021 to $55.2 million as of May 31, 2022, due to accretion expense, with these notes set to mature on June 30, 2023 | Convertible Notes Carrying Value | Amount ($'000) | | :--- | :--- | | Balance as at November 30, 2021 | 54,227 | | Accretion expense (YTD) | 976 | | **Balance as at May 31, 2022** | **55,203** | - The convertible unsecured senior notes mature on **June 30, 2023**[31](index=31&type=chunk) [Note 10: Share Capital and Warrants](index=13&type=section&id=Note%2010%3A%20Share%20Capital%20and%20Warrants) The company's share capital structure includes common shares, warrants, and a stock option plan, which was amended in early 2022 to a 'rolling plan' allowing for up to 10% of outstanding shares to be issued, contributing to a net loss per share of ($0.33) for the first six months of 2022 - On March 3, 2022, the company's Board of Directors amended the stock option plan to a 'rolling plan', allowing for the issuance of up to **10%** of all common shares issued and outstanding[36](index=36&type=chunk) | Loss Per Share | Three-Months Ended May 31 | Six-Months Ended May 31 | | :--- | :--- | :--- | | **2022** | ($0.24) | ($0.33) | | **2021** | ($0.07) | ($0.14) | [Note 13: Capital Management and Liquidity Risk](index=18&type=section&id=Note%2013%3A%20Capital%20Management%20and%20Liquidity%20Risk) The company manages its capital to ensure sufficient liquidity for operations, relying on product revenues and periodic financing, and as of May 31, 2022, held $32.5 million in cash, bonds, and money market funds, which, along with future cash flows and a new financing facility secured post-period, is believed to be sufficient for at least the next 12 months - The company depends on revenue from EGRIFTA SV® and Trogarzo®, as well as periodic securities offerings and debt financing, to fund its activities[46](index=46&type=chunk) - As of May 31, 2022, the company's cash, bonds, and money market funds totaled **$32,491 thousand**[47](index=47&type=chunk) - Management believes its cash position and future operating cash flows, supplemented by a new financing secured after May 31, 2022, will be sufficient to finance operations for at least the next **12 months**[47](index=47&type=chunk)[48](index=48&type=chunk) [Note 15: Operating Segments](index=20&type=section&id=Note%2015%3A%20Operating%20Segments) The company operates as a single operating segment and faces significant customer concentration risk, with over 98% of its revenues for the six months ended May 31, 2022, generated from a single customer, RxCrossroads, domiciled in the United States - The company has a single operating segment and significant customer concentration, with over **98%** of revenues in the first half of 2022 coming from one customer, RxCrossroads[53](index=53&type=chunk)[54](index=54&type=chunk) [Note 16: Subsequent Events](index=20&type=section&id=Note%2016%3A%20Subsequent%20Events) On July 13, 2022, subsequent to the reporting period, the company secured a crucial binding commitment for a non-dilutive senior secured term loan of up to $100 million with Marathon Asset Management, with the initial tranche of $40 million expected by July 29, 2022, and concurrently arranged to repurchase $30 million of its convertible notes, addressing near-term maturity risk - On July 13, 2022, the company announced a binding commitment for a non-dilutive term loan facility for up to **$100 million** with Marathon Asset Management[55](index=55&type=chunk) - The loan is structured in four tranches, with the first **$40 million** expected to be funded by July 29, 2022[55](index=55&type=chunk) - Subsequent tranches are contingent on meeting specific revenue and regulatory milestones[55](index=55&type=chunk) - The company also signed agreements to repurchase **$30 million** principal amount of its Convertible Notes, with the purchase to be completed by July 29, 2022[56](index=56&type=chunk)
Theratechnologies(THTX) - 2022 Q1 - Earnings Call Transcript
2022-04-13 18:55
Theratechnologies Inc. (NASDAQ:THTX) Q1 2022 Earnings Conference Call April 13, 2022 8:30 AM ET Company Participants Paul Levesque - President & CEO Philippe Dubuc - SVP & CFO Christian Marsolais - SVP & Chief Medical Officer John Mullaly - IR, LifeSci Advisors Conference Call Participants Andre Uddin - Mackie Research Capital Stephen Kwai - National Bank Financial Operator Good morning, ladies and gentlemen, and thank you for standing by. Welcome to Theratechnologies First Quarter Fiscal Year 2022 Earnings ...
Theratechnologies(THTX) - 2022 Q1 - Earnings Call Presentation
2022-04-13 14:45
| --- | --- | --- | --- | |-------------------------|-------|------------------------|-------------------------------------------------------------| | | | | | | | | | | | | | | | | NASDAQ: THTX TSX: TH | | Clinically High Growth | Theratechnologies: Poised for Opportunities March 2022 | Forward-Looking Information | --- | --- | |------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- ...
Theratechnologies(THTX) - 2022 Q1 - Quarterly Report
2022-04-13 11:45
[Interim Consolidated Financial Statements](index=3&type=section&id=Interim%20Consolidated%20Financial%20Statements) [Interim Consolidated Statements of Financial Position](index=3&type=section&id=Interim%20Consolidated%20Statements%20of%20Financial%20Position) As of February 28, 2022, Theratechnologies Inc. reported total assets of $108.7 million, a decrease from $119.2 million at November 30, 2021, primarily driven by a reduction in cash, while total liabilities decreased slightly to $98.5 million and total equity saw a significant reduction from $17.8 million to $10.2 million due to the net loss for the period Financial Position (in thousands USD) | Financial Position (in thousands USD) | Feb 28, 2022 | Nov 30, 2021 | | :--- | :--- | :--- | | **Total Current Assets** | $83,490 | $91,908 | | Cash | $14,342 | $20,399 | | **Total Non-current Assets** | $25,180 | $27,304 | | **Total Assets** | **$108,670** | **$119,212** | | **Total Current Liabilities** | $41,782 | $45,076 | | **Total Non-current Liabilities** | $56,728 | $56,376 | | **Total Liabilities** | **$98,510** | **$101,452** | | **Total Equity** | **$10,160** | **$17,760** | [Interim Consolidated Statements of Comprehensive Loss](index=4&type=section&id=Interim%20Consolidated%20Statements%20of%20Comprehensive%20Loss) For the three months ended February 28, 2022, the company's revenue increased to $18.6 million from $15.4 million in the prior-year period, but a significant rise in operating expenses led to a larger loss from operating activities of $7.7 million compared to $4.6 million in 2021, widening the net loss for the period to $9.0 million, or $(0.09) per share, from $5.9 million, or $(0.07) per share Income Statement (in thousands USD) | Income Statement (in thousands USD) | Q1 2022 | Q1 2021 | | :--- | :--- | :--- | | **Revenue** | **$18,557** | **$15,430** | | Cost of sales | $6,099 | $5,411 | | R&D Expenses | $8,003 | $4,883 | | Selling Expenses | $7,807 | $6,158 | | General & Administrative Expenses | $4,368 | $3,562 | | **Total Operating Expenses** | **$26,277** | **$20,014** | | **Loss from Operating Activities** | **($7,720)** | **($4,584)** | | **Net Loss for the period** | **($9,032)** | **($5,922)** | | **Basic and Diluted Loss per Share** | **($0.09)** | **($0.07)** | [Interim Consolidated Statements of Changes in Equity](index=5&type=section&id=Interim%20Consolidated%20Statements%20of%20Changes%20in%20Equity) Total equity decreased from $17.8 million at the beginning of the period to $10.2 million as of February 28, 2022, primarily due to the net loss of $9.0 million and a minor other comprehensive loss, partially offset by $1.4 million in share-based compensation, contrasting with a significant increase in the prior-year period due to a $46.0 million public offering - Equity decreased by **$7.6 million** in Q1 2022, primarily due to a net loss of **$9.0 million**, partially offset by **$1.4 million** in share-based compensation[7](index=7&type=chunk) Equity Movement (in thousands USD) | Equity Movement (in thousands USD) | Q1 2022 | | :--- | :--- | | **Balance as at Nov 30, 2021** | **$17,760** | | Net loss for the period | ($9,032) | | Other comprehensive loss | ($6) | | Share-based compensation | $1,438 | | **Balance as at Feb 28, 2022** | **$10,160** | [Interim Consolidated Statements of Cash Flows](index=6&type=section&id=Interim%20Consolidated%20Statements%20of%20Cash%20Flows) For the first quarter of 2022, the company experienced a net cash outflow of $6.1 million, reducing its cash position to $14.3 million, with cash used in operating activities at $4.1 million and financing activities at $2.0 million, a sharp contrast to the $36.4 million net cash inflow from a public offering in the same period of 2021 Cash Flow Summary (in thousands USD) | Cash Flow Summary (in thousands USD) | Q1 2022 | Q1 2021 | | :--- | :--- | :--- | | **Cash flows from Operating Activities** | **($4,105)** | **($5,228)** | | **Cash flows from Financing Activities** | **($1,979)** | **$41,168** | | **Cash flows from Investing Activities** | **$22** | **$440** | | Net change in cash | ($6,062) | $36,380 | | Cash, beginning of period | $20,399 | $12,737 | | **Cash, end of period** | **$14,342** | **$49,116** | [Notes to Interim Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Interim%20Consolidated%20Financial%20Statements) [Note 1: Basis of Preparation](index=7&type=section&id=1.%20Basis%20of%20preparation) The unaudited interim consolidated financial statements were prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the IASB, specifically following IAS 34, Interim Financial Reporting, presented in U.S. dollars, and should be read in conjunction with the annual financial statements for the year ended November 30, 2021 - The financial statements are prepared on a going concern and historical cost basis, with certain financial instruments measured at fair value[16](index=16&type=chunk) - The company's functional and presentation currency is the **United States dollar (USD)**[19](index=19&type=chunk) [Note 2: Significant Accounting Policies](index=8&type=section&id=2.%20Significant%20accounting%20policies) The accounting policies applied in these interim financial statements are consistent with those disclosed in the company's annual consolidated financial statements for the year ended November 30, 2021 - There have been no changes to the significant accounting policies from the most recent annual report[20](index=20&type=chunk) [Note 3: Revenue](index=9&type=section&id=3.%20Revenue) Total net sales for the first quarter of 2022 were $18.6 million, a 20.3% increase from $15.4 million in the prior-year period, primarily driven by a 34.7% increase in EGRIFTA® net sales, with the United States remaining the dominant market, accounting for over 97% of total revenue Net Sales by Product (in thousands USD) | Net Sales by Product (in thousands USD) | Q1 2022 | Q1 2021 | | :--- | :--- | :--- | | EGRIFTA® net sales | $11,704 | $8,688 | | Trogarzo® net sales | $6,853 | $6,742 | | **Total** | **$18,557** | **$15,430** | Net Sales by Geography (in thousands USD) | Net Sales by Geography (in thousands USD) | Q1 2022 | Q1 2021 | | :--- | :--- | :--- | | United States | $18,099 | $14,576 | | Europe | $313 | $715 | | Canada | $145 | $139 | | **Total** | **$18,557** | **$15,430** | [Note 4: Finance Income and Finance Costs](index=9&type=section&id=4.%20Finance%20income%20and%20finance%20costs) Net finance costs for the quarter were $1.29 million, slightly lower than the $1.33 million recorded in the same period of 2021, primarily consisting of interest and accretion expenses related to the convertible unsecured senior notes Finance Costs Breakdown (in thousands USD) | Finance Costs Breakdown (in thousands USD) | Q1 2022 | Q1 2021 | | :--- | :--- | :--- | | Interest on convertible notes | ($802) | ($802) | | Accretion expense | ($517) | ($581) | | Other | ($25) | - | | **Total Finance Costs** | **($1,344)** | **($1,383)** | | Finance Income | $59 | $51 | | **Net Finance Costs** | **($1,285)** | **($1,332)** | [Note 5: Provisions](index=10&type=section&id=5.%20Provisions) Provisions, mainly consisting of chargebacks, rebates, and returns, increased to $5.2 million as of February 28, 2022, from $4.1 million at the end of the previous fiscal year, with $4.0 million in new provisions made and $2.9 million used during the quarter Movement in Provisions (in thousands USD) | Movement in Provisions (in thousands USD) | Chargebacks and rebates | Returns | Total | | :--- | :--- | :--- | :--- | | **Balance as at Nov 30, 2021** | **$3,713** | **$410** | **$4,123** | | Provisions made | $3,843 | $196 | $4,039 | | Provisions used | ($2,762) | ($130) | ($2,892) | | **Balance as at Feb 28, 2022** | **$4,765** | **$476** | **$5,241** | [Note 6: Convertible Unsecured Senior Notes](index=10&type=section&id=6.%20Convertible%20unsecured%20senior%20notes) The carrying value of the convertible unsecured senior notes increased to $54.7 million as of February 28, 2022, due to accretion expense of $0.5 million during the quarter, with these notes set to mature on June 30, 2023 - The carrying value of convertible notes increased from **$54.2 million** to **$54.7 million** due to accretion expense[24](index=24&type=chunk) - The convertible unsecured senior notes mature on **June 30, 2023**[24](index=24&type=chunk) [Note 7: Lease Liabilities](index=11&type=section&id=7.%20Lease%20liabilities) Total lease liabilities amounted to $2.4 million as of February 28, 2022, down from $2.5 million at the end of the previous fiscal year, with the non-current portion of these liabilities being $1.9 million Lease Liabilities (in thousands USD) | Lease Liabilities (in thousands USD) | Amount | | :--- | :--- | | Balance as at Nov 30, 2021 | $2,518 | | Accretion expense | $43 | | Lease payments | ($156) | | **Balance as at Feb 28, 2022** | **$2,405** | | Current portion | ($476) | | **Non-current portion** | **$1,929** | [Note 8: Share Capital and Warrants](index=11&type=section&id=8.%20Share%20capital%20and%20warrants) This note details the company's equity structure, including a public offering in 2021, the stock option plan, stock appreciation rights (SARs), and the calculation of loss per share, with over 2.3 million new stock options granted and a share-based compensation expense of $1.4 million recorded during Q1 2022 [Public Offering](index=11&type=section&id=8(a)%20Public%20offering) In January 2021, the company completed a public offering of 16.7 million units at $2.75 per unit, raising gross cash proceeds of $46.0 million, with each unit consisting of one common share and one-half of a warrant, exercisable at US$3.18 until January 19, 2024 - Completed a public offering on January 19, 2021, raising gross proceeds of **$46,002 thousand**[27](index=27&type=chunk) - As of February 28, 2022, **8,130,550 warrants** were outstanding, exercisable at **US$3.18 per share** until January 19, 2024[28](index=28&type=chunk) [Stock Option Plan](index=11&type=section&id=8(b)%20Stock%20option%20plan) The company granted 2.1 million options denominated in CAD and 255,000 options in USD during the first quarter of 2022, resulting in 5.3 million CAD options and 0.3 million USD options outstanding as of February 28, 2022, and a share-based compensation expense of $1.4 million for the quarter - Share-based compensation expense for the stock option plan was **$1,438 thousand** for the three months ended February 28, 2022, compared to **$557 thousand** in the prior year period[32](index=32&type=chunk) Options Outstanding | Options Outstanding | As at Feb 28, 2022 | As at Feb 28, 2021 | | :--- | :--- | :--- | | Options in CA$ | 5,304,673 | 4,113,024 | | Options in US$ | 335,733 | 93,593 | [Stock Appreciation Rights (SARs)](index=15&type=section&id=8(c)%20Stock%20appreciation%20rights%20(SARs)) The company has a cash-settled Stock Appreciation Rights (SARs) plan for consultants, recording a share-based compensation expense of $4 thousand for the three-month period ended February 28, 2022, down from $21 thousand in the prior year, with no new SARs granted during the quarter - Share-based compensation expense for the SARs plan was **$4 thousand** for Q1 2022, down from **$21 thousand** in Q1 2021[38](index=38&type=chunk) [Loss Per Share](index=16&type=section&id=8(d)%20Loss%20per%20share) The basic and diluted loss per share for the quarter was $(0.09), based on a net loss of $9.0 million and a weighted average of 95.1 million common shares outstanding, with potentially dilutive securities excluded as their effect would have been anti-dilutive Loss Per Share Calculation | Loss Per Share Calculation | Q1 2022 | Q1 2021 | | :--- | :--- | :--- | | Net Loss (in thousands USD) | ($9,032) | ($5,922) | | Weighted Average Shares | 95,121,639 | 84,692,788 | | **Loss Per Share** | **($0.09)** | **($0.07)** | - A total of **5,640,406 share options**, **8,130,550 warrants**, and **3,872,053 potential shares** from convertible notes were excluded from the diluted EPS calculation as they were anti-dilutive[41](index=41&type=chunk) [Note 11: Capital Management and Liquidity Risk](index=17&type=section&id=11.%20Capital%20management%20and%20liquidity%20risk) The company manages its capital to ensure sufficient liquidity, holding $34.3 million in cash, bonds, and money market funds as of February 28, 2022, which management believes is sufficient to finance operations for at least the next 12 months, while actively evaluating options for its convertible senior notes due in June 2023 and for funding late-stage development programs - The company is evaluating its options regarding the convertible senior notes which become due in **June 2023**[45](index=45&type=chunk) - As of February 28, 2022, cash, bonds and money market funds amounted to **$34,283 thousand**[47](index=47&type=chunk) - Management believes its current cash position and future operating cash flows are sufficient to finance operations for at least the next **12 months**[47](index=47&type=chunk) [Note 12: Determination of Fair Values](index=18&type=section&id=12.%20Determination%20of%20fair%20values) This note outlines the methodology for determining the fair value of financial instruments using a three-level hierarchy, classifying bonds, money market funds, and derivative assets as Level 2 based on broker quotes, while the fair value of convertible notes is determined by Level 1 market quotes and employee stock options are valued using the Black-Scholes model - The fair value of the convertible unsecured senior notes was approximately **$50,313 thousand** as at February 28, 2022, based on **Level 1 market quotes**[52](index=52&type=chunk) - Bonds, money market funds, and derivative financial assets are stated at fair value determined by **Level 2 inputs** (broker quotes)[52](index=52&type=chunk) [Note 13: Operating Segments](index=19&type=section&id=13.%20Operating%20segments) The company operates as a single operating segment with significant customer concentration, generating over 97% of its revenues from one customer, RxCrossroads, located in the United States, while the majority of its non-current assets are located in Canada and Ireland - The company has a **single operating segment**[55](index=55&type=chunk) - Over **97% of revenues** are generated from a single customer, RxCrossroads, which accounted for **$18.1 million** in sales in Q1 2022[55](index=55&type=chunk)[56](index=56&type=chunk) [Note 14: Subsequent Event](index=19&type=section&id=14.%20Subsequent%20event) In March 2022, subsequent to the quarter-end, the company paused activities related to the initiation of its Phase 3 trial in NASH due to uncertainty created by a global shortage of bacteriostatic water for injection, which may result in a write-down of research supplies currently included in prepaid expenses - In March 2022, the company paused the initiation of its Phase 3 trial in NASH due to a global shortage of bacteriostatic water for injection[57](index=57&type=chunk) - The company may need to write-down research supplies included in prepaid expenses and deposits as a result of the trial pause[57](index=57&type=chunk)
Theratechnologies Inc. (THTX) CEO Denis Boucher on FY2021 Results - Earnings Call Transcript
2022-02-27 15:14
Summary of Theratechnologies Inc. Q4 2021 Earnings Conference Call Company Overview - **Company**: Theratechnologies Inc. (NASDAQ:THTX) - **Date of Call**: February 24, 2022 - **Key Participants**: - Paul Levesque - President and CEO - Philippe Dubuc - SVP and CFO - Christian Marsolais - SVP and CMO Core Industry and Company Insights 1. Commercial Strategy and Sales Force - Theratechnologies is transitioning to an internal sales force to enhance engagement and performance, moving away from a contract sales organization model [7][9][40] - The internal sales force aims to improve competitive positioning and drive growth in commercial portfolio [8][71] - The company is finalizing employment offers to top performers from the current contract sales organization [9] 2. Financial Performance - Consolidated revenues for Q4 2021 were $18.8 million, a decrease of 1.9% year-over-year [21] - EGRIFTA SV revenues increased by 18.6% to $12.7 million, driven by higher unit sales and net selling prices [21] - Trogarzo revenues decreased to $6 million from $8.4 million, impacted by lower new patient starts during the pandemic and a provision for potential clawbacks in France [22][23] - Revenue guidance for fiscal 2022 is projected between $79 million and $84 million [23] 3. Clinical Development Updates - The oncology program TH1902 is nearing the establishment of the maximum tolerated dose (MTD) and will soon initiate a basket trial [13][30] - The NASH program is advancing with an amended protocol submitted to the FDA for a seamless Phase 2b/3 study, aiming to assess efficacy on a smaller subset of patients [18][72] - The company is exploring out-licensing opportunities for TH1902 in Greater China, with ongoing discussions with various pharmaceutical companies [16][71] 4. Market Dynamics and Growth Potential - The company reported a 5.7% overall growth in 2021, with a notable 10% growth in the second half compared to the first half [12] - New patient enrollment across franchises grew by 24% in the second half of 2021, indicating positive market traction post-COVID [12] - The company is optimistic about the potential for tesamorelin as a treatment for NASH, following renewed interest in the area [17] Additional Important Insights 1. Cost Management - Cost of sales remained stable at $6.4 million, while R&D expenses increased to $8.7 million due to higher spending in oncology and NASH programs [24] - Selling expenses rose to $8.2 million, reflecting the addition of senior personnel to strengthen the sales organization [24] 2. Strategic Partnerships and Collaborations - The company is actively seeking partnerships for its NASH program and exploring non-dilutive financing options [19][72] - Discussions are ongoing with companies interested in leveraging Theratechnologies' peptide for targeting cancer cells [17] 3. Regulatory and Market Access - Negotiations with the French government regarding Trogarzo pricing are ongoing, impacting revenue projections [23][45] - The company is focused on securing reimbursement in various European countries, with a strategic approach to pricing and patient volume [46] 4. Future Outlook - Theratechnologies aims for 13% to 20% growth in its commercial portfolio in 2022, leveraging the momentum from the second half of 2021 [71] - The company emphasizes its unique position as a revenue-generating enterprise, allowing for selective capital allocation [12] This summary encapsulates the key points discussed during the conference call, highlighting Theratechnologies' strategic initiatives, financial performance, clinical developments, and market outlook.