Harrow Health(US:HROW)2025-03-28 19:29Financial Data and Key Metrics Changes - The company reported fourth quarter revenue of $66.8 million, an 84% increase compared to Q4 2023 and a 36% sequential increase [7] - Full year 2024 revenues increased by 53% to approximately $199.6 million, with adjusted EBITDA rising 43% to $40.3 million [7] - Q4 net income was approximately $6.8 million, with core gross margins reaching 84% for Q4 and 80% for the full year 2024 [7] Business Line Data and Key Metrics Changes - IHESO achieved a 43% increase in unit volume in Q4, generating $23 million in revenue, accounting for 34% of total revenues [9] - vVy prescriptions increased by 44% in Q4, marking a successful first year since its launch [10] - Triessence had minimal contribution in Q4 but is expected to drive revenues significantly starting in Q2 2025 due to recent market access wins [8][20] Market Data and Key Metrics Changes - Demand for key products like IHESO and vVy remains strong, with unit demand for both increasing by over 40% compared to the previous quarter [7] - The company is focusing on expanding its market share in the U.S. dry eye market, which is estimated to have a potential of 30-35 million patients, with only a small fraction currently on therapy [31] Company Strategy and Development Direction - The company aims to leverage its strong product portfolio and market access programs to drive growth, particularly through the vVy Access For All initiative [19][32] - A strategic supply and development agreement has been signed for Triessence, with plans for lifecycle management and a next-generation version to be submitted for FDA approval by 2027 [21] - The company is focused on maintaining a strong commercial team and innovative market access strategies to enhance product availability and affordability [12][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in meeting or exceeding internal forecasts for 2025, particularly with the anticipated contributions from Triessence and the vVy Access For All program [8][20] - The company is optimistic about its growth trajectory, citing a strong demand for its products and a commitment to reducing barriers for patients [30][35] - Management highlighted the importance of operating leverage and recurring revenue streams as key drivers for future financial performance [60][61] Other Important Information - The company has transitioned to a new auditing firm, which caused delays in filing its Form 10-K, but management is committed to avoiding such delays in the future [6] - The company plans to stop reporting prescription data to IQVIA, which may affect the accuracy of market data [18] Q&A Session Summary Question: Can you explain the significant gross to net improvement for vVy? - Management confirmed that vVy revenue more than tripled, with improved average selling price (ASP) due to fewer co-pay buy downs and increased demand [25][26] Question: What are the expectations for vVy in 2025? - Management indicated that vVy is on track to more than double in 2025, supported by the vVy Access For All program [29][30] Question: What is the outlook for EBITDA in 2025? - Management expects significant operating leverage and cash flow conversion from adjusted EBITDA, with a focus on managing operating expenses effectively [37][40] Question: Can you elaborate on the need for extended payment terms with distributors? - Extended payment terms are tied to the introduction of new buy and bill products, allowing end users to complete their revenue cycle before payment is requested [44][46] Question: What are the commonalities in metro markets where vVy has a strong market share? - Management noted that access remains a key issue, and they are working to reduce barriers for patients and prescribers [47][48] Question: What is the timeline for the next regulatory milestone for MELTS 300? - The NDA filing is expected around this time next year, following the completion of ancillary studies [94][95] Question: Does quarterly revenue include distributor stocking? - Revenue recognition is based on end-user demand, with Q4 benefiting from increased demand for vVy and IHESO [96][98]