Journey Medical (US:DERM)2025-05-14 21:32Financial Data and Key Metrics Changes - Journey Medical reported net product sales of $13.1 million for Q1 2025, a slight increase from $13.0 million in Q1 2024, which included approximately $2.0 million from the initial revenue of AMROCI [6][12] - Gross margin improved to 64% in Q1 2025 from 54% in the prior year, attributed to lower product costs and a favorable sales mix [13] - R&D costs were nil in Q1 2025 compared to $7.9 million in Q1 2024, which included preapproval and milestone payments related to AMROCI [13] - SG&A expenses increased by $2.1 million to $10.6 million in Q1 2025, reflecting investments in commercial infrastructure for the AMROCI launch [13] - Net loss for Q1 2025 was $4.1 million, or $0.18 per share, compared to a net loss of $10.4 million, or $0.53 per share, in Q1 2024 [14][15] - Cash position at the end of Q1 2025 was $21.1 million, up from $20.3 million at the end of 2024 [15] Business Line Data and Key Metrics Changes - The launch of AMROCI is seen as a significant milestone, contributing to initial sales and expected to become the flagship product [6][16] - Legacy products experienced a decline of approximately 10% to 15%, attributed to generic competition [24] - QBREXZA showed strong performance with a 15% increase in prescriptions year-over-year, despite new competition [25][26] - Accutane prescriptions decreased from 93,000 in Q1 2024 to 66,000 in Q1 2025, impacted by new competitors, but showed a 10% growth compared to Q4 2024 [28][30] Market Data and Key Metrics Changes - Approximately 30% of covered commercial insured lives now have access to AMROCI, up from 20% previously [11] - The company actively calls on 83% of dermatology offices that prescribe oral rosacea treatments, leveraging existing brand equity [9] Company Strategy and Development Direction - The company aims to expand access and grow prescription volume for AMROCI while publishing additional peer-reviewed data to support its clinical value [17] - Focus on building brand awareness and ensuring payer coverage to translate prescription momentum into sales [10][11] - The management believes 2025 will be a transformational year for Journey Medical, with a commitment to long-term value creation for patients and shareholders [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the positive initial response to AMROCI and its potential to achieve sustainable EBITDA positivity later in the year [6] - The dermatology-focused sales force is fully trained and actively promoting AMROCI, with early indicators showing over 660 unique healthcare providers writing prescriptions [16][17] - The company is optimistic about the trajectory of AMROCI's launch and expects continued growth in the coming months [40][41] Other Important Information - The Phase III clinical trial results for AMROCI were published in JAMA Dermatology, highlighting its statistical superiority over competitors [8] - The National Rosacea Society updated its treatment algorithms to include AMROCI, signaling confidence from the dermatology community [9] Q&A Session Summary Question: Expectations for AMROCI revenues in Q2 - Management indicated that the initial $2 million in revenue was largely due to stocking and expects additional revenues in Q2 as the product gains traction [20][21] Question: Performance of legacy business - The legacy business is experiencing a decline due to generic competition, with specific products like QBREXZA performing well despite new entrants [24][25] Question: Inventory levels in distribution - Management estimated that inventory levels are typically between two to four weeks during a new product launch [34][36] Question: Early feedback from prescribers - Positive feedback has been received regarding AMROCI's efficacy and tolerability, with many prescribers expressing satisfaction with the product's performance [37][39] Question: Erythema reduction feedback - Anecdotal feedback from dermatologists indicates satisfaction with AMROCI's impact on erythema, although this is not the primary focus of the marketing message [50][51] Question: Repeat prescribers for AMROCI - There is a mix of prescribers, with some writing multiple prescriptions, indicating a positive reception in the market [57]