Journey Medical (US:DERM)2024-03-22 00:22Financial Data and Key Metrics Changes - The company reported total revenue of $79.2 million for 2023, a 7% increase from $73.7 million in 2022, marking an all-time high since inception [18][37] - Gross profit margins increased by 22% in 2023 due to a 50% reduction in contractual royalty obligations for Qbrexza starting in May 2023 [38] - SG&A expenses decreased by $15.6 million or 26% to $43.9 million in 2023 compared to $59.5 million in 2022 [39] - The net loss for 2023 was $3.9 million or $0.21 per share, significantly improved from a net loss of $29.6 million or $1.69 per share in 2022 [41] Business Line Data and Key Metrics Changes - Accutane experienced a 27% year-over-year growth in IMS prescriptions from 2022 to 2023 [1] - Qbrexza saw a 6% increase in prescription levels from 2022 to 2023, indicating effective marketing and sales efforts [2] - The four core products (Qbrexza, Accutane, Amzeeq, and Zilxi) now represent approximately 90% of the company's product revenue [20] Market Data and Key Metrics Changes - DFD-29, a new oral therapy for rosacea, demonstrated statistical superiority in clinical trials compared to the current market leader, Oracea, which had approximately $300 million in annual TRx sales in 2023 [22][29] - DFD-29 is expected to achieve peak annual net sales of $300 million, with $200 million projected from the U.S. market alone [30] Company Strategy and Development Direction - The company aims to continue reducing SG&A expenses by an additional $2 million to $5 million in 2024, targeting a total reduction of approximately $20 million from the 2022 SG&A expense base [20] - The company is focused on out-licensing its intellectual property and exploring new product opportunities in dermatology to enhance revenue [27][34] - The company plans to invest resources for the NDA approval and commercial launch of DFD-29 in early 2025 [25] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism regarding the market potential for DFD-29 and its ability to differentiate itself in the rosacea treatment landscape [24] - The company is well-positioned to invest in and prepare for the anticipated launch of DFD-29, believing it could become the standard of care for rosacea treatment [33] - Management highlighted the importance of stabilizing the commercial business and the positive contributions expected from core brands [21] Other Important Information - The company paid off a $20 million debt facility and entered a new credit agreement with SWK Holdings for up to $20 million in non-dilutive debt capital [26] - The company had $27.4 million in cash and cash equivalents at the end of 2023, down from $32 million at the end of 2022 [42] Q&A Session Summary Question: Can you discuss the rights for DFD-29 outside the U.S. and potential timelines for international market entry? - The company holds global rights for DFD-29 except for BRIC and CIS countries, with a focus on the U.S. market while exploring potential partnerships in Europe and Asia [50] Question: What are the expected incremental launch costs for DFD-29 in 2025? - The company plans to expand its sales force from 35 to potentially 45-50 representatives as they prepare for the launch, which is anticipated in Q1 or early Q2 of 2025 [53][55]