HROW - Earnings call transcript Q4 2023

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Operator

Good morning, and welcome to Harrow's Fourth Quarter and Year-End 2023 Earnings Conference Call. My name is Drew, and I will be your operator for today's call. [Operator Instructions] As a reminder, the conference is being recorded. [Operator Instructions] I would now like to turn the call over to Jamie Webb, Director of Communications and Investor Relations for Harrow.

Jamie Webb

Thank you, operator. to Quarter welcome Earnings Year-End and Call. Conference morning, Harrow's and Fourth XXXX Good

today, remind meaning let company's begin we Before me include laws. statements securities remarks you forward-looking within federal the of may the that

Forward-looking formulations statements and of the time and to are and which a FDA-approved as ability to to technologies, risks numerous time Harrow's available including SEC described of uncertainties, the commercially filings, control, approval such the many compounded at timely beyond all. in uncertainties subject are company's to risks make from in its products is certain and uncertainties and or candidates FDA and related drug manner risks

the those or those time-sensitive information, and with report today. or description or projected. a annual is of results intention new see subsequent conference Harrow future any financial company's on and Form differ as only For accurate XX-K of statements and and reports because Securities uncertainties, may forward-looking contains call any materially or filed most risks otherwise. This revise XX-Q list on from Form and whether recent the of disclaims update information events Commission. Harrow's to please Exchange quarterly the section of obligation projections Risk Factors

per earnings should the Additionally, release. adjusted core margin, measures both you net have which adjusted earnings and stockholders, release specifically comparable now earnings A to results with of of a measures Harrow copy our of as company's the on available letter referred diluted reconciliation directly core is gross the income income received included the GAAP press non-GAAP in EBITDA as most net core and are share. to financial website. By any metrics, core such well non-GAAP as and

the If not please website, company's a www.harrow.com. you to Relations go received of Investor page the copy, have

over Officer, Chief With to Financial I'll turn Chief Baum; Officer, call call on Mark Harrow's prior the that, over prepared to go Executive me some Joining Boll. question-and-answer Andrew today's remarks L. session. Mark are to and Harrow's the

Mark Baum

we for to change on and everyone investors extend our in time to prior the this thanks believed wanted you and earnings earnings results when allow between joining issued release the have and of my address our our hosted and to timing We our helpful. analysts call. the Jamie, interest We through call. corporate We read calls. to the and best our time hope I change was to calls. today's to found us presentation it conference Thanks, the in stockholders amount digest savings and letter release of hoped more for first would this

the these North years my were a So what in transformation call, I X and mirror the we was on days reviewed plan you've now augment out this this through business. leading XXXX, more Harrow. in American understanding was become to which is transformative said than stockholders all making, if I of time pointed about years materials, XX ophthalmic some year in when our I quoted letter for ago high-level use assume to which pharmaceutical commentary. XXXX, hatching that X you're I'll was It to your a rearview a when I in

few of plan. XXXX a that the are Here of fruits

Three, than ophthalmic year year fourth products operations. flow with quarter most revenues. second of revenues more and we our our in XXXX significant up from made cash delivering which short-term of high-utility XXXX pharmaceutical big numerous delivering addition X Number EBITDA adjusted activities in from financial XX% to our beginning operating And TRIESENCE, and drivers. and long-term million consecutive in VEVYE cash finally, last doubled flow $X.X one, the IHEEZO, products, cash achieved positive record the from portfolio. XXXX to Four, XXXX. increasing over Two, our of generate revenues from

You see the includes position and year, our equivalents, $XX with in balance in cash our cash and ending we cash last especially our year strengthened million this pharmaceuticals. position, sheet

talent We the important, family, experience, expect new further our our Equally cash members adding pile relationships and few new corporate the our to continue fresh transformation. these the stockholders a perspectives base, Harrow to in coming professionals and the I with deck. grow to to commercial the of fortified enhance letter we to over of names highlighted have folks both Harrow the years.

to want alone so the amazing growth been on we're granularity. provide have This our to professionals X in U.S. trust million cyclosporine. stockholders bullish the company eye us. our the granularity from the speaks detailed Eye but VEVYE does things, patients. ingredient sales we I I that large question, small quarterly as around has the The the information This cyclosporine. is media. results. active force you our our dry dominate us United market cycle, disease trust eye feedback to most about the encourage patients anti-inflammatory disease Based leading social success think trajectory see chronic asking for adoption #X by on launch. driven our States. Our know of tried to market other front I've year. the more VEVYE more of They trust and dry U.S. highlights, about cyclosporine date, Without why cyclosporine for Patients the positive cyclosporine care and mighty in cyclosporine. with convinced is volumes units potential am the among on VEVYE would product. size VEVYE success It last had actual trusted we've was about curve, to Payers,

metrics our direction. rolling is right the with moving see of You VEVYE performance all key the in train

TRIESENCE, of is that average of unit last by manufacturing in year. I of substantial something has over recent revenue our CMS continued Mark that millions CEO if requested seen. of he significantly until told the is VEVYE also since our file. promise for that on pharmacy return our terms one we launch period. I meeting VEVYE when of partner, that of, which in all and become batch, in make our ASP about its hit to patients users I successful why word, not eye have the we're for has upon would of extent also next parameters pricing, combined physicians talk quotes reintroduced we multi-X-figure available uptake be soon. I or price a about the Harrow is on previous the from of commercial from talk in IHEEZO XXXX a to this believe also our in TRIESENCE market. lay This soon and the I me eventually performance disease of had units made specialty after IHEEZO the and TRIESENCE them a batch. expected which will to successful publication about previously very most dry volume we and I should hopefully its new the the May growth production fulfilling discussed I included we number CMS recently product, launches our a also acted generate was news stockholders' is and with Silarx, ImprimisRx been value product. January X selling clear trajectory, of expect letter. met not by actual sale the ASP, U.S. stockholders the set addressable fact, market long benefit batch, a In This the that month. progress out the and for including PPQ

be the because progress our revenue in made of Harrow used clear I from to with leading I've hear opinion front what is for the want my so-called XXXX, us, who, our important in it of strategic on it products. You leaders, products. I ophthalmologists a and growth, was see ophthalmic of stockholder. optometrists actually have making in with been this used our company. our actually that KOLs, a better in because XXX% and time never noted American profitability goals, pathway further to stockholders, or us North significant including you to recent to it's of pharmaceutical achieving mention ultimately who of reliance conversations upon right we also opinions fellow investigation, a thought a eyes, not front key I amazing and certainty say right

Harrow stock, plan sold a do I my and Harrow and I to be have cookie. fine executive as I own continue a this to not stockholder so. Finally, share of senior never company, both do a perfectly at eating

Harrow fact, I shares. purchased In recently,

X and because the value Harrow's times past shares the in I believe fact, XX long-term at been In in months, an available precisely have because price. attractive

questions. for We operator are your happy answer our have I now will to questions. pause to Operator? poll

Operator

with Riley B. comes Instructions] first Securities. The Mayank [Operator from Mamtani question

Mayank Mamtani

out. both help give XXXX the and guide the the XQ you some on you're just longer-term number forward-looking. And I that of and VEVYE? incremental able TRIESENCE provided give IHEEZO, X you're on to understand forward-looking I your the thinking how Are to contribution follow-ups. granularity results you then assuming guidance there Maybe you a also growth outlook. quick could the XXXX didn't Appreciate XXXX? also EBITDA in to breakdown notice between drivers, put of and And couple relatedly, It have spend

Mark Baum

Yes. Mayank. you, Thank

the million We office the that So is IHEEZO and I most guide a separately guidance that for the have think since filing setting consequential in put has room, happened in out to make $XXX XXXX. company XXX-pound X-K paid founded I better Form what look, what the fact, don't I physician's be that one think, that animal than in the confirmation without will CMS The we in that in revenue behind we're from is product. for standing our XXXX. we by back comment question with and event, the positive in Andrew is is, I'll it our today

event. in us yesterday Form X we're by with kind our to very It we than us So excited about $XXX It's But our is something certainly once confidence in a product. out big greater number guide guidance, hit which we're our afternoon confidence greater very, the positive o'clock it going a not But again, what a far today of surprise. this about It is X-K. supports But that guidance. gives million. happened very certainly Central. put very in

our of do this of quarter, X-K in especially about in talk the the want XXXX, XXXX, fourth light spend in of the our spend Andrew, morning? with we're In put some XXXX out kind thinking you maybe and of terms to about we what how approach in

Andrew Boll

numbers. to launch. heavier the Thanks in In in QX planned or to on coming were and quarter marketing came employees. of tied than plans in our added were Mark. changing K, can question. resulted in those majority And launch commercial VEVYE or of a of kind A its the shift really November, can the -- just initially much Thanks, about vast VEVYE see we and the effort for. We make year-over-year. we kind Yes. fourth spend on started -- infrastructure you about the and This a sales you side. of some expense read the XXX during In new the the for

And so is a lot into continue to of going that obviously expense XXXX.

the giving that efforts reasons get as leverage specific want is sales One we'll ratio of in we ratio and having the of to, revenue further number grow, growth. said, revenues which invest is a expense. We'll not a leverage operating That invest guidance marketing being in less we're the Xx. have EBITDA to to we -- than

that. at on focused we're side, to focused growing said, these opportunity sales product a Mark like we great going example. growth same an marketing we're But and on is so revenue the further to on accelerating be areas, invest revenues time, but in IHEEZO the see and And

the to time Now sales It's revenues. of and we've outcome put the got great invest foot on grow and to more marketing CMS. the efforts this kind there heavily really with

Mark Baum

think doubt in will I of Yes. senior warrants that Oaktree Xx receiving you I both far XX-K, Andrew that probably our as and and Oaktree, with of filed, was exceeds agreement ratio any related the we have Andrew know on at know, is in filed made a that, hits to lender, of Form Form to points morning, but and obviously leverage our the you comment we friends greater if receive And under they and them. can warrants one our this confidence, a sincerely said X-K I'll be one result add kind this XXXX. our which that further this who we

Mayank Mamtani

retinal clarify Yes. to what that if very just color. segment of IHEEZO unique you in on is the to and Also, helpful And cyber-attack expand, on for to including, Harrow? utility I in final expectation That's that issue you think question both X that Is units these have visibility [indiscernible] date you for February, getting reference demand one for versus maybe IVT some as organic retina made the X procedures. specialists you're on bilateral unit. And can they're eyes more you have sort using injections of VEVYE. that billing separate from could on

Mark Baum

missed the I What it? Mayank, was first part,

Mayank Mamtani

claims Harrow issue, issue unique whether of is wide that broader a now? pharma to attack processing cyber or that's The right

Mark Baum

Yes. Sure.

not the with D as So Bravo as Part issue B products, companies, us, affected numerous in Healthcare sell also including has David only that Change but Part in products.

system affected the but from systems has of Healthcare So being unclogged. our evidence payments seeing quarter, of has is And in we government. still unclogged. be this the the temporarily issue sort our are the first beginning Change customers And affected the to to sales

We expect that it recovery has in this many sell full the companies issue, cyber is But normalization has pharma many, market. second quarter. affected into the attack but who affected the and us, an

million is in uptake this market opportunities these year. large happen retina why for uptake that But our are reimbursement the XX that injection market, very we retina, because concentrated. per the last is of market highly large the of that very of in products. We specifically potential We The buyers intravitreal saw to market. terms the reason unique is talked market. were In to I stockholders unit in There exceeding retina in is the it market groups was market, went about there form country. seeing around letter the in and a in CMS, is

in office opportunities with it we was us, which would, of in reimbursable product-specific our face so in in setting. a permanent of separately the those is the physician's J-code, front thought prudent sorts confirm CMS be fact, to in fact, that, J-code, And of

in promised stockholders, We with January to on X, we that CMS. and requested letter waiting from so been them. we we last meeting as have meeting hear the a And to had patiently

the event ASP to for physicians which, recently, said ASP As the afternoon, we yesterday as in that we is did happened a not not added said, the were payment that the And whether file remarks, in company. office. the important separate confirmed or prepared we know I file, physician's just but very

opportunity that is attributes for significantly a think, can the of unique that now think, and fantastic us. that up our trajectory the for able expectation and to, that is to injections market very, very IHEEZO also, for a But also numerous open change, and Our we product I application. soon, I very used going company. it start very, this in from and it's news, other obviously is It's interventions, will IHEEZO exciting here for be for ophthalmic intravitreal with IHEEZO will benefit that

Mayank Mamtani

And lastly, to you good some put Yet said on for VEVYE, out launch up. months XX metrics. you up it could ramp take

dynamics get in the So are back here hop what could follow, queue. what just to be? And I'll with that, curious on play visibility to sales in peak

Mark Baum

you, Thank Mayank.

Maria by And the I put And VEVYE, mention named project First has want she respect is to with amazing. of woman is a team, to person, commercial the into effort just VEVYE, all, that because being led a extraordinary. is this Lloyd. effort she the

is she's involved market in corporate launch saw our fantastic. our team. experienced. has with to very on well, grateful into working lot of to eye the right, organization up brought numbers, people that the all She really respect wonderful that But are you done. the presentation, her of the all is in which VEVYE as into are of launch Restasis. the extremely She the knows of She dry metrics recent and she I'm So a everything was

I the information referenced there that's performing the In publicly social available. product is extremely and the out -- Importantly, well. market, media

we hopes that product. high have And so for very

is a it X compounded market, ImprimisRx cyclosporine to for years. the units our over market. now market. As really we've dry U.S. the in shift cyclosporine X.X% very last market years, what X We I've million eye We've the for complete VEVYE business which the well. year presents is And strong said know several studied with in

of or X.XX% profile X.XX% VEVYE. different of dominate So is version it's that branded products, terms the is and available. profile we patients the so product branded have the The of is, of And even other we think or whether generic a cyclosporine have can tolerability there's opportunity version the the cyclosporine that product from tolerability in those many that products cyclosporine its very category. what failed

and uptake And so terms a that benefit the size the to a product have candidates of are real our people our me Form this products, aggregate from for gives we far or market the this about certain this actually mean certainly of I that our filed This what couple zone The now. we in confidence can our the was VEVYE, the product something talked that a those lot I us that more is morning. are things greater in number went about be. way. of in to of VEVYE. qualifies that, was is portfolio that wanted product target there as met. portfolio stockholders puts of failed can with in And our those be that us of certainly, that revenue well, billion that $X in I letters a getting to revenue wrote billion which X-K way, to be, $X where going today that things for ago, announced

about doing So and excited we're and team are with Maria VEVYE. really amazing what her that

Operator

The Capital Markets. next Lake Aaron with question from Wukmir Street comes

Aaron Wukmir

few line know you Brooks. TRIESENCE, on color appreciate far. is have the I all to the I This setbacks? any so had more could to remarks. for prepared And there in of you're your year-end, before bit provide inventory that be timing there just that? just more thinking a I would confidence helpful. sort and that on the if maybe guess get Aaron been comments related a how I But you color guess about

Mark Baum

you, Aaron. Thank Sure.

partner, this I that that was processes are reintroducing be made for particular that in than kind more what terms the involved a tell letter the -- the challenge because people knowledge produced. practicing, as was years to product and going weren't is the you manufacturing being is knew making in of wasn't stockholders, in the We organization, were really were But being very soon. the high meeting that you I going in we're the manufacturing our months dormant in point, there of confidence made TRIESENCE to to tell in at because it. here market by successfully is given X X can it that last product who somewhat our way, what or into everyone employee of So and have a does whether look, our in they of people But of the the and made, said degree that not our no can we're a consultant to all TRIESENCE success have that TRIESENCE an very progress of that confidence were There one doubtful. degree I going and they're required is we've a parameters not high organization make to have organization, very by soon.

commercial the going of I batch April. produced, specification to is meets middle a happen, that's PPQ in performance which said, the that have a batch, production being as the We effectively parameters, batch a

more going you whether interested unusual on can't stockholders to if And bit information, going unusual the product I should as as our of have happen you, our that getting manufacturing high There's I an we'll very you August. as community, be can our of box from here one by produce strong physician back in batches organization. for said, high What degree we And to is sophisticated help on quite It's have said manufacturing in or period first the an partner, a I back and track. utility So it the back seeing in that a is predict can think and is happen it's product. X we'll within I we can see months, And market, also corporate be we're tell the couple very very, product very June is is label. to confidence soon. to about a presentation a partner of TRIESENCE, but TRIESENCE with a we, and letter I very it's it able successful. very soon. by very a the tell then in more

Operator

Instructions] from comes [Operator next Thalmann. question Cohen The Jeffrey Ladenburg with

Jeffrey Cohen

have just for and Andrew. X Mark I

somewhat anticipated did year, could about for talk the last Should top the upon we you touch you -- something the could for perhaps cadence year? on year? Firstly, we of margins increasing secondly, inclusive linearly expect anticipated the And as TRIESENCE? line then

Mark Baum

are, And margins want add our But our million. over anything? should and which want you do to think we're increase, of to Andrew, the numbers keep going with Andrew, decrease. tackle try in we this think news not -- I said, that? I morning, as to I you is where do $XXX

Andrew Boll

sticking this what more on we feel intact. Jeff, of opportunity. $XXX year. the Mark then or a perspective, margins Yes. with margins, We to we're to kind reiterate is said, said, EBITDA approach revenue And just from what be operating revenue is that's million strongly which going than upon dependent

We And so we're expectations. growth EBITDA the kind going revenue with of leverage temper to mentioned ratio.

the extent, want we'll to we we and levered it. Xx out at of an about -- thinking invest year. revenue IHEEZO that outside do opportunities if the thinking But we'll in end sure that, under of for to especially about growth we're be TRIESENCE to years, continue VEVYE, coming in the see So

for in revenue as be keep may certainly, percent make the margin actual mind and leverage the year, so the investments numbers different we'll the we depending future. plan the for on And but ratio

Jeffrey Cohen

any at And it. pricing there would Okay. to anticipated is in lastly, then be about first, any 'XX? could any Got 'XX? appreciated. And take Did there you all? you pricing Or talk pricing comments

Mark Baum

and and affordability. other Andrew, raised to are in portfolio There of prices And do anything in assistance do or lowered But to aggressive, it's place actually you branded whether have focused make anything, and of and we on company. products product a Andrew, a just are I'll from cornerstone that add is made on on our start them philosophically, touch to say our That be the patient our we've pricing? more ensure to just product. want product we on want program prices product products philosophy do compounded we that one that, always there even that? access clear, a any sure also before is to affordability that on. our accessible. can to access benefit pricing who is we on you have

Andrew Boll

in acquisition some WAC Yes. for corporate that to some cost some going being the deck, gross-to-net $XXX for notable product we wholesale Mark's the relaunched But probably have pricing is one, we product of products. Jeff, specifically pricing is that. more the to at market. be most TRIESENCE just where time WAC point, the a element in list to price. the There's

in the access and co-pay is the the that We assistance lot and the affordability we're up factors the see footnotes. You a accounting which the our patient sure our programs, programs, in in to which accounting, for living talked mission, gross making patient. about

in products the we're to and we them so selling going the ultimately, getting the patient also but make we that element, supply products money to that make price element. sure And to access can products steady patients, keeping -- the mind have a the of we're

Mark Baum

great of hit related The market. to related since is a the had -- price any adjustment not TRIESENCE. TRIESENCE XX to product that actually of TRIESENCE A example for years seen

therefore, it ends year. competitively. is not year after the that drug the not being on And list shortage challenges up has year -- available, on and list a There's actually with the product after so priced been shortage to incentive a the drug one just that's profit that product of not FDA's make made

the a a pricing preservative-free than TRIESENCE, per about said, but it's it the which thought is we competitive priced triamcinolone when It's at as with product, in other for We so more looked product, unit. market. our and unit. that's at And preservative-free $X,XXX triamcinolone product $XXX is Andrew not

we're And price. of half almost that so

So are to over we're accessible products in and always There $X,XXX intravitreal per lower steroid more price are unit. $X,XXX, and certainly other try going to that affordable. be be more

make we them, lower of product us the a provide to adjust have but product in we did profit steady which that considerable. we incentive sure to enough create and so And to the remain is significantly to supply market, the price than the invest for

Operator

session. question-and-answer turn to This I for Baum, concludes our closing any to L. conference over Mark the back like remarks. would

Mark Baum

after across allows Medicare is that things to yesterday, unique the our very physician's country. make clinics IHEEZO Thank and want separately it of kind centers is it apologize and a beneficiaries for issuance happened. you, of to actually to close. we opens which very I quarter and immediately we press patented ready the low-viscosity up of But news letter said to received earnings to publish to has all most large fourth and It's of you experience I mentioned the release, who as preparing which the yes, anesthetic market CMS our are guess intended gel, for drafting market going make go, to company from after that payable, And topical the the happened to which separately which I going fantastic IHEEZO, and our surgery to getting consequential our fortunately, I stockholders product. benefits documents our reimbursable in is the of in waiting office. earlier, yesterday, year-end fortunately, And everything it positively Drew. thing those the doing

we delay after our not revealing we we down filings, that filings from development. the a new out calm Form decided market before and to So and this X-K made excitement separate put then wonderful those opened ultimately

could stockholders, the letters I it aggregate of being in very example apologize about news that we So of to for member answer special from this go as I mentioned exposure beautiful $X things publishing procedures. in our for thing that to an example of product dangerous that protocols It's achieve reducing anesthesia you the no news. we're was to annual If, thing good positively yesterday prayers I family, our was stories, was a how some our earlier, was revenue changing for yesterday some In an and stories potential. of because Indeed, as patient being once is seeing said tardy every heard for an slightly IHEEZO way. our past we practical went stockholders, appreciate I ophthalmic but It's billion news around reasons of country Harrow some I've hope said, opined Yesterday's again, portfolio many way. actually. of opioids. amazing even our revenue. everything, a

to feels is and we Harrow. going what to about team very happen therefore Our good IHEEZO believe

So what our all days, of want who patience has our their employees, this been acknowledge Harrow I stockholders win. communication a their families and of loyal from to Couple for support our thank close employees family, our world support. and I and members steadfast

of today going progress. has soon cornerstone of. but come. is to Never been proud to not we yet very a that the for And truer company to in a been is build come Your mission Harrow, that best be together, only it than belief our our can we're

to for in for today's interest and everyone your Harrow. attending Thanks call

We our investor-related conclude jwebb@harrowinc.com. any please at, questions, Jamie This Webb call. e-mail have will

Operator

conference presentation. The today's attending has concluded. now Thank you for

disconnect. now may You

Harrow Health (HROW) 20 Mar 242023 Q4 Earnings call transcript