Harrow Health(HROW) - 2025 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - For Q4 2025, consolidated revenues were $89.1 million, representing a 33% year-over-year growth. For the full year, revenue was $272 million, up 36% versus 2024 [22][23] - Adjusted EBITDA was $24.2 million in Q4 and $61.9 million for the full year, reflecting a 54% year-over-year growth, demonstrating operating leverage as revenue scales faster than costs [22][23] - The company generated just under $44 million of cash from operations, ending the year with $72.9 million in cash and cash equivalents [23] Business Line Data and Key Metrics Changes - BYOOVIZ had Q4 revenues of $25.9 million, up 14% sequentially, with full-year revenue at $88.7 million, a 216% increase over 2024 [24] - IHEEZO generated $35.9 million in Q4 and $81.3 million for the full year, representing 64% quarter-over-quarter growth and 65% year-over-year growth [24] - TRIESENCE's Q4 revenue was $5.1 million, a 36% increase from Q3, totaling $9.9 million for the year, a 193% increase from 2024 [25] - The rare specialty and compounded portfolio generated $22.2 million in Q4 and $92.3 million for the full year [25] Market Data and Key Metrics Changes - The company expects full-year 2026 revenue between $350 million and $365 million, with first half revenue projected at $133 million to $153 million and second half revenue at $203 million to $226 million [26] - The first quarter is expected to be the lowest revenue quarter due to stocking activity and insurance resets, with a significant portion of IHEEZO's demand expected to be drawn down from Q4 2025 inventory [27][28] Company Strategy and Development Direction - The company aims to exceed $250 million in quarterly revenue by the end of 2027, with a diversified ophthalmic franchise focused on expanding patient access and improving affordability [12] - Plans include doubling the VEVYE sales force and expanding IHEEZO into office-based settings, targeting over 2.5 million additional procedures annually [12][32] - The company is preparing to launch two important products, BYQLOVI and BYOOVIZ, further expanding its specialty portfolio [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's growth trajectory, emphasizing that all core growth drivers accelerated in Q4 2025 [41] - The company is focused on converting compounded utilization into FDA-approved branded products, enhancing long-term revenue profiles [41] - Management anticipates a stronger second half of 2026, driven by a fully deployed sales force and contributions from new product launches [35] Other Important Information - The company is addressing temporary compounding inventory constraints, expecting normalization by the end of Q1 2026 [25] - R&D expenses are expected to increase to approximately $30 million-$35 million as the company completes studies for product candidates [31] Q&A Session Summary Question: What have you seen so far from a commercial mix perspective in Q1? - Management noted that new prescription volumes for VEVYE are better than expected, with a slight uptick in ASP anticipated [50][51] Question: What % of the cataract market do you think is the sweet spot for TRIESENCE? - Management believes TRIESENCE will not be limited by a temporary pass-through period and aims to expand its label for broader access [55][57] Question: Could you clarify the price improvements for IHEEZO? - Management expects pricing for IHEEZO to improve by Q3 2026 compared to 2025 [64][65] Question: Are you able to share any market share targets for VEVYE? - Management aims for VEVYE to be the number one cyclosporine in the U.S. market, targeting over 20% market share [71][75]