Heron Therapeutics(HRTX) - 2024 Q3 - Earnings Call Transcript

Financial Data and Key Metrics Changes - The company reported a revenue growth of over 12% year-to-date, with gross margin improving from 41% to just over 72% and gross profit doubling from $37 million to $75 million [9] - The net loss for Q3 2024 was $4.8 million, a significant reduction from $25 million in Q3 2023, while the year-to-date net loss was $17.2 million compared to $99.8 million in the same period last year [24] - Cash and short-term investments stood at $70.9 million as of September 30, 2024, with a year-to-date cash burn of less than $10 million [24] Business Line Data and Key Metrics Changes - Total acute care net revenues for Q3 were $7.4 million, with ZYNRELEF contributing $6.3 million and APONVIE contributing $1.1 million [12] - The number of accounts ordering APONVIE tripled over the last 12 months, with an average of 652 daily units sold in October, translating to over $7 million in annualized sales [18] - CINVANTI generated net revenues of $22.6 million for the quarter, maintaining around a 20% market share despite competitive pressures [19] Market Data and Key Metrics Changes - The CrossLink partnership is beginning to drive growth for ZYNRELEF, with nearly 40,000 units ordered in CrossLink accounts to date, amounting to roughly $4.4 million in net revenue [14] - The company is adding an average of 21 new CrossLink accounts per month, indicating a positive trend in market penetration [14] Company Strategy and Development Direction - The company is focused on the "One Heron" initiative, integrating business units to sell the entire product portfolio, which has improved efficiency and accountability [16] - The approval of the Vial Access Needle (VAN) and inclusion in the NOPAIN Act are expected to significantly enhance ZYNRELEF's market position [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about Q4 2024, providing a net revenue guidance range of $37 million to $43 million based on early successes [8] - The management believes that the NOPAIN Act will create significant awareness and provide a tailwind for ZYNRELEF, especially in the context of opioid alternatives [39] Other Important Information - The company has revised its financial guidance for the year, narrowing the net revenue range to $140 million to $146 million and adjusted EBITDA guidance to a positive range of $2 million to $5 million [25][26] - The Prefilled Syringe program is progressing, with a targeted approval date at the end of 2026 or early 2027 [46] Q&A Session Summary Question: How should the uptake curve for VAN be anticipated? - Management expects the VAN to be in the market by the first week of December, starting with a few accounts to ensure a smooth launch [28] Question: Comments on CINVANTI's sequential decline and outlook for Q4? - Management noted that CINVANTI is in a competitive market and experienced a loss of a large account in Q3, but expects a bounce back in Q4 due to new account wins [32][33] Question: Is the decrease in OpEx a new baseline? - Management clarified that the decrease in OpEx is not a new baseline but a result of timing and efficient management [37] Question: How much of a tailwind can the NOPAIN Act provide? - Management believes the NOPAIN Act will significantly enhance awareness and provide a tailwind for ZYNRELEF, especially in the context of opioid alternatives [39] Question: Update on the development of the Prefilled Syringe? - The Prefilled Syringe program is progressing well, with a targeted approval date at the end of 2026 or early 2027 [46]