Eton Pharmaceuticals (ETON) Q2 2025 Earnings Call August 07, 2025 04:30 PM ET Speaker0Thank you for standing by. My name is Alex, and I will be your conference operator for today. At this time, I would like to welcome everyone to the Eton Pharmaceutical q two twenty twenty five earnings call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session.If you would like to ask a question during this time, simply press star follo ...

Financial Data and Key Metrics Changes - The company's first quarter revenue was $17.3 million, a 117% increase from $8 million in the first quarter of 2024 [35] - Product sales reached $14 million, up 76% from $8 million in the prior year, driven by increased sales of Alkindi Sprinkle and the addition of Incralyx [36] - Adjusted gross profit was $12 million, or 69.5% of total revenue, compared to $5.2 million or 65.6% in the prior year [36] - Adjusted EBITDA for the first quarter was $3.7 million, compared to $500,000 in the prior year [39] - The company reported a net loss of $1.6 million for the quarter, compared to a net loss of $800,000 in the prior year [40] Business Line Data and Key Metrics Changes - Alkindi Sprinkle has shown strong growth for 17 consecutive quarters, with an increase in new patient referrals in 2025 [15] - Incralyx has seen rapid patient acquisition, reaching over 90 active patients shortly after its relaunch, with expectations to reach 100 by year-end [8][12] - Galzin, acquired for Wilson's disease treatment, is expected to generate significant revenue as the company addresses access and affordability issues [21][22] Market Data and Key Metrics Changes - The company is focusing on pediatric endocrinology, leveraging its existing sales force and infrastructure to drive growth in this segment [6][15] - The market for severe primary IGF-1 deficiency is estimated to have around 200 patients in the U.S., with potential for significant growth through increased awareness and screening [6][12] - The Wilson disease market is estimated to impact approximately 10,000 people in the U.S., with only about 2,000 diagnosed and treated, indicating a substantial unmet need [19][20] Company Strategy and Development Direction - The company aims to become a leading player in the ultra-rare disease market, with a strong focus on product launches and pipeline development [30][31] - The strategy includes harmonizing U.S. and EU labels for Incralyx to expand treatment opportunities significantly [10][12] - The company is also advancing new product candidates like ET-700 and ET-800, targeting unmet needs in rare disease treatments [24][29] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's growth trajectory, expecting to exit 2025 with an annual revenue run rate of approximately $80 million [36] - The management team is optimistic about the upcoming product launches and the potential for significant revenue growth from the pipeline [31] - The company is not concerned about tariff impacts, as most products are produced domestically, and any European purchases represent less than 5% of forecasted revenue [33][34] Other Important Information - The company has made significant investments in infrastructure to support growth, including a dedicated metabolic sales team and commercial activities for product relaunches [37][38] - The company expects to maintain adjusted gross margins of approximately 70% for the full year 2025, with long-term goals exceeding 75% by 2028 [36] Q&A Session Summary Question: Update on Incralyx FDA meeting - The meeting request has been submitted, with expectations for a follow-up in July and a submission for label change in Q3 [42] Question: Recent interactions with FDA regarding ET-400 - The company is on track for approval within two weeks, with final labeling discussions underway [44] Question: Weekly Incralyx prescription trends - The company has significantly increased the number of patients, with expectations to exceed revenue goals this year [54][55] Question: Expected timing for ET-400 commercial revenue - The launch is anticipated around June, with revenue expected to ramp up in Q3 [56][57] Question: Commentary on tariff risk exposure - The company does not foresee a meaningful impact from tariff proposals, as it primarily sells domestically [60][62] Question: Feedback on Galzin relaunch - The relaunch has been well-received, with a strong patient uptake and zero copay for patients [68][70]

Financial Data and Key Metrics Changes - The company's first quarter revenue was $17.3 million, a 117% increase compared to $8 million in the first quarter of 2024 [37] - Product sales reached $14 million, up 76% from $8 million in the same quarter last year, driven by increased sales of Alkindi Sprinkle and the addition of Incralyx [38] - Adjusted gross profit was $12 million, or 69.5% of total revenue, compared to $5.2 million or 65.6% in the prior year [39] - Adjusted EBITDA for the first quarter was $3.7 million, compared to $500,000 in the prior year [43] - The total net loss was $1.6 million, compared to a net loss of $800,000 in the prior year [43] Business Line Data and Key Metrics Changes - The acquisition and relaunch of Incralyx and Dalzan contributed to strong growth in existing products [6] - Alkindi Sprinkle has shown consistent growth for 17 consecutive quarters, with an increase in new patient referrals in 2025 [16] - The company expects to reach approximately 80,000,000 annual revenue run rate by the end of 2025 [38] Market Data and Key Metrics Changes - The company is focusing on pediatric endocrinology, leveraging its existing sales force and commercial infrastructure to raise awareness of severe primary IGF-1 deficiency [8] - The market for ET400 is estimated to have around 5,000 adrenal insufficiency patients under nine years of age, presenting a compelling opportunity [18] Company Strategy and Development Direction - The company aims to become a leading player in the ultra-rare disease market, with a focus on expanding its product portfolio through acquisitions and licensing [31] - The strategy includes harmonizing U.S. and EU labels for Incralyx to expand treatment opportunities significantly [13] - The company is also developing ET700, an extended-release version of Galzin, to address dosing challenges and improve patient outcomes [24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth trajectory of existing products and the potential for new product approvals in the near future [6] - The company is optimistic about the upcoming launch of ET400, expecting rapid uptake and significant revenue impact in subsequent quarters [60] - Management noted that the tariff situation is not a major concern, as most products are produced in the U.S. and the impact of European purchases is minimal [34][35] Other Important Information - The company has made significant investments in infrastructure to support growth, including a dedicated metabolic sales team and commercial activities for product relaunches [41] - The company reported a cash balance of $17.4 million and generated $2.1 million in operating cash flow during the quarter [43] Q&A Session Summary Question: Update on Incralyx label expansion meeting with FDA - The meeting request has been submitted, and the company expects to have it in the coming weeks, likely in July [45] Question: Recent interactions with FDA regarding ET400 - The company is on track for approval within two weeks, with the final step being labeling discussions [47] Question: Weekly Incralyx prescription trends - The company has significantly increased the number of patients and expects to meet or exceed revenue goals this year [56] Question: Expected timing for commercial revenue from ET400 - The launch is expected around the approval date, with revenue anticipated in Q3 [59] Question: Feedback on Galzin relaunch - The relaunch has been well-received, with a strong uptake and zero copay for patients, improving access significantly [70]