Heron Therapeutics(HRTX) - 2024 Q4 - Earnings Call Transcript

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$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$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]