DERM - Earnings call transcript Q1 2022 | Journey Medical Corporation

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Operator

Ladies and gentlemen, thank you for standing by. Good afternoon and welcome to the Journey Medical First Quarter 2022 Financial Results and Corporate Update Conference Call. At this time, all participants are in a listen-only-mode. [Operator Instructions] Participants on this call are advised that the audio of the conference call is being broadcast live over the internet and is also being recorded for playback purposes. A webcast replay of the call will be available approximately 1 hour after the end of the call for approximately 30 days. to the conference company’s like Ibrahim to now Co-IR, of Investor would turn over the Jose I Relations firm. sir. ahead, go Please

Jose Ibrahim

Thank thank today’s and you. for Good in participating you conference everyone call. afternoon

Co-Founder, Officer; from joining Journey for will Ernie leadership Claude Executive Joining me Alloush, President Chief General Medical Chief Financial today and Paolantonio, be session. Ramsey team the Corporation’s are question-and-answer Maraoui, and De who Officer; Counsel

for will management address be making performance including statements, results. that expectations call, forward-looking Journey statements Medical’s this future operational or During

statements actual involve from risks may Forward-looking and other results those that factors cause materially to differ statements.

information filed Medical’s refer this useful to most company’s the with the its the non-GAAP today more XX-Q, press Form the Journey periodic these particularly within. conference filed Medical’s Form in on accompanies SEC reports Journey described in For risks, be recently XX-K and about that release X-K beliefs risk call call, Form please Today’s the can and evaluating financial factors includes statements cautionary and performance. measures the

should information or for a substitute accordance in prepared additional not in consider as results with isolation GAAP. You this

obligation or to to President to except pleasure call. as any Maraoui, update call now this any that table to financial measure please reconciliation comparable law, Officer. May Chief XXXX the time-sensitive Executive over publicly contain this only direct of or It’s disclaims loss by see accurate earnings as GAAP turn circumstances reflect after release. the Claude? in and For today and is XX, Co-Founder, of of the occur required Medical most Journal net to this call information company’s revise financial non-GAAP reconciliation press Claude located events my contents measure, The information that’s

Claude Maraoui

first of growth XXXX Thanks, Jose. the to notable and another several year positions for progress first Good on and for call. record fronts quarter everyone during which the thanks company quarter we yet has our Journey conference made believe joining afternoon results.

to of prescription our acquisitions products products. developing dermatology in continued additional our we FDA portfolio half The and and the products, X product acquiring sales XXXX. of launched marketed Vyne two Therapeutics’ X strong approved AMZEEQ XX% revenues with and of in-licensing product first grown for through the dermatology when leading new $XX.X our industry prescription launching force foundation second the combined ZILXI, With was during future first combined now half the our has products XXXX with portfolio expansion results $XX.X XXXX. Net is These and the Qbrexza quarter to increase for an both Accutane, million. primarily of growth. revenue were of by of compared driven product million, of of anticipate

the and and AMZEEQ $X.X In for new addition, an two we launched quarter. ZILXI, in prescription acquired revenues products, which combined incremental million contributed dermatology

Journey milestone to to XXXX. momentum This included $XX.X the its million company, and fully Medical in of for the that results integrated These gives in strategy Ministry expect including We our the overall product first earned leading hyperhidrosis. Journey Medical, quarter. first revenue of axillary increase treatment license Labor In a by when lifecycle. January, primary an X.X%, in equivalent will for see Wipes of net exclusive our XXXX. products representative acquire, of $X.X with and licensing XXX% Maruho This triggered us dermatology into of payment partner and announced Japan’s are a quarter that or net our of the these R&D total over approved continued approval Qbrexza manage Rapifort of excellent transform a Welfare of Japanese Health, Japan, million

growth. price growth, Targadox competition competition since may generic we decline build XXXX QX continue products which has to momentum future new in of rising our and seen encounter that expect and While a

DFD-XX. the operations commercial first adjusting to in to XXXX. of favorably reported for adjusted quarter cash development of our R&D expenses million $X.X quarter EBITDA of the of with the related compares positive continue the after adjusted non-GAAP million flow This generate in EBITDA to Importantly, $X.X

suffer first data pivotal an to for estimated Phase in our market with company of XXXX. billion The rosacea, During estimated is current our the year. dosed TRX is quarter, end efficacy the clinical million is XXXX. for to Phase trial double first for sales nearly patients our milestone overall demonstrated patient DFD-XX evaluated this patients X of which the XXX in expectation we DFD-XX papulopustular from DFD-XX, correlated sales by ratio, of treatment the the significant in which XX program opportunity a rosacea. being This as leader $X for the $XXX and X TRX significant, is our million an in market in reach

We excited As you we develop and additional with believe strong foundation financial the are pipeline to our will for ended as can already see, in in the acquire. products to we very about our quarter $XX.X we cash. million opportunities is look and continue

up our million have on to this was we with to available. addition to are strategic that allowing remains credit our expanded plan In growth EastWest QX balance, IPO. pleased very to say Journey’s full presented since And first Bank, shareholders am public million we borrow as $XX of executing agreement, a I quarter the to we us company. which $XX

it flexibility With now review another half new first accretive our acquisitions, that the Ernie in our launch believe year results will quarter. I XXXX Medical Journey financial over products and is the the we this financial continued and With the of to product scheduled in to for momentum growth for beyond. of make and who will well-positioned turn second continued that,

Ernie De Paolantonio

review to product period the and Total quarter XXXX. XX, revenues will March financial Claude increased XX% million for everyone. ended $XX.X the the hello Thanks, $XX.X ended period for or March X-month results. XXXX million net million first from X-month now I XX, $XX.X

to first launched $X.X from in increased goods during effect growth Japan, million the the as and launched Medical Claude our payment first in will we will Targadox acquisition QX and a earlier Qbrexza, revenues we when second of royalty $X.X decrease profit generic exclusive Maruho million for due sales further and of decrease of quarter, from end XX% of Claude by due sales Qbrexza in of the increase a our rate million increase million revenue total ended the QX, the also of versus in in XXXX, primarily January in primarily DFT-XX the XXXX percentage Accutane launched for partner quarter mentioned In the to $XX.X reflects to of of the late our $XX.X of for year. QX, and $X.X X-month up asset period sales period million XXXX million from generic and $XX.X earlier is related realized. increased full March and clinical for pressure by notably develop Journey March million over Our The to promotional that zero quarter XXXX. higher increased incremental March for milestone was sales XXXX, newly same to and gross as the $X.X period-to-period development $X.X reflect of product $X.X period in ended Other and nets by Cost product. from our volume from beyond is a X-month XX, million and is expenses expired first to force XXXX. revenue competition period sold ZILXI the May a prior is XX million AMZEEQ, rate X-month continued of from increase our driven increased quarter. products, costs of the expect incremental to QX will Vyne Qbrexza net XXX% primarily from expenses of XX, Accutane mentioned competition. for XXXX that gross $X.X profit and from from Research the royalty royalties QX and in quarter million XXXX emphasis out-licensing Qbrexza’s part higher for revenue a ended X-month to has us net notably that step reflects the revenues trial

and as remain by the Claude million share $X.XX basic compared our quarter basis. expenses March product these of and primarily as related $X.X expenses per $X.X to of for We and marketing of of attributable positive and And in trials. on general $X.XX sales cash were our expansion for or loss $X.X increase diluted the operations legal XXXX a expenses. the to $XX.X patients million portfolio, the XXXX. diluted additional to million EBITDA non-GAAP in XX basic expanded $X.XX our are administrative force, we the million or also is first quarter mentioned, expenses first commercial net ended income quarter flow was expect and to enrolled Selling, first Net for

compared of turn we it on purchase $XX.X and working equivalents the for Vyne As the cash operating to of March million capital the one-time acquisition XXXX, in for reflects December that, to I XXXX XX, in And and will of assets acquired. required XX, million $XX.X back the cash with had assumption Claude. expenses cash expenses as

Claude Maraoui

Great. you, Thank Ernie.

revenue earlier, with expect this achieve momentum additional year, product in anticipated strong in As with we launch new record along products, the I mentioned to at one our least XXXX.

the the continue be we most our turn questions. for operator public near call position to traction Thank in optimize acquisitions, to over gain As I now to we a company fully in and to hope guidance as the a integrate recent and future. you. will give

Operator

first Instructions] [Operator go Riley. Kalpit Patel B. ahead. from comes question The with Please

Kalpit Patel

taking Hey, Thanks questions. my for good afternoon. Yes.

did quarterly if had Vyne the the primarily Ernie, the declining, were for I think guess, So this of I Claude was So or because if products competition that exclude your those have additional existing Targadox. right, sales you impact or math assets for essentially from slightly from flat Therapeutics? you the I

last there were other entering I learned players that think were through. quarter we that

the main decline? this reason was So, that for

Claude Maraoui

Thanks, for Kalpit. question. Thanks the

$XX.X I versus full reflect are X year to the of at QX we First million for again, sales want what in did ago to million. $XX.X portfolio all, want just the

So, we this together. portfolio all of look combined at assets a full our as

you that certainly This of planning. When year, but In contributing portfolio XXXX, life away the take certainly pressure of QX has look sales framework, been in QX revenue this part down for look competition. way to cycle has anticipated of been some had, represented the historical year the our a of at we under something there taken Targadox, XXXX, has in revenue at you previous entire XX% that of that’s in the last just terms when Targadox generic Targadox. of Still from the of overall to XX%. significantly the is all

have Targadox, example, prescriptions, our the Qbrexza. sales AMZEEQ for de-emphasized to newer and the the force, We from

are Qbrexza ZILXI, and growth AMZEEQ, So, right Exelderm. this predominantly now, planned. drivers, in we the just really focused we all what anticipated And is on

Kalpit Patel

additional during product you of launching question. Okay. the – to How have detail mentioned your And you are then us can second much to you that an half in more guess call line, are the I expect give at And you product? on least then period? launch year. top I it launch you this one initial expected this additional impact on the

Claude Maraoui

product. we the Sure. of disclosed Yes. name This is haven’t – the

but no we to add terms So, to giving that. of this what you contribute is that. know, the to in But be Non-biologic limited guidance I you antipyretic I think not want really to an don’t line. if forward going on anything Ernie, too histamines. mysterious, are product, just top to is to sales, looking

Ernie De Paolantonio

year lesser we the not with providing not half extent, going still a for the second It’s we to are again, product. this Kalpit, guidance – of are Yes. but

Kalpit Patel

one that the I in the haven’t are Targadox last that Orange future? in the on for commercial other remaining assets but then Book, assets, place, foreseeable And any you the expecting any Okay. of outside competition have checked assets question other you generic of

Claude Maraoui

Again, I look listed that past in patent think taking is about ZILXI, have have at the we Ximino. our talking with everything and of drugs Orange AMZEEQ, Qbrexza, lives. in are a accurate, portfolio, we stated terms Book

of anywhere the parts All out late-XXXXs. runways. long have way different into good, have mid these from the in patent and out lives XXXX from And all extending

Kalpit Patel

taking questions. for the Okay, Thanks fantastic.

Claude Maraoui

Absolutely.

Operator

Our ahead. from Please Cantor go with Brandon Folkes comes next question Fitzgerald.

Brandon Folkes

on the about the talk quarter. congratulations two Hi. can growth you Maybe taking Rapifort. in the my opportunity me, for for Thanks strong for and Japanese questions just

your find been you the very while, in the Just insight a that. market Thank resilient recession? I Obviously, then have is a it’s secondly, so heard portfolio how it the diversified. to interesting But there. into sizing nicely And around space love any bit if for just of you. thoughts

Claude Maraoui

Sure.

– your what clarify me? the of the about second can The question, Brandon, you for part that second recession,

Brandon Folkes

I have in guess how DERM performed historically right. a given products recession,

stats all it’s think got I love size portfolio you and I a fits your one just diversified and feedback? have answer, very maybe but not

Claude Maraoui

Yes. And dermatology. again, I for that dedicated industry to XX over time all in the have been really and years of

is a booked relatively through couple long time a way. resilient. cycles. not been Dermatology for has So, are There enough of quite and those out dermatologists usually look

when demand down here, up So, economy. in back just look slowdown typically a about Journey days at time reflect patient and the When is I the COVID. a in take there XX%, taking dermatology that the the there, same was back In look XXXX, XXXX at a whole was even a Journey XX%. is as about at

So, we held that during own pretty time. well our

So, difficulties we are and open all a companies. recession to the with dealing other like

is will Rapifort. we goes all regarding recession Switching great I question guess. long a it how to depends Maruho And in shape. deep think been has partner. and first be good I a your back on how

They got know this year bit some They in different of some out plans large. to getting it’s market, the terms great more X.X% there of little more. have the there a for Japanese It’s and hyperhidrosis them strength example. over strength, axillary hyperhydrosis already market The We have have formulation rather in and is market. last Rapifort. for been competition

a second will about have be marketplace. I they history. rooted And with got a I they are deep But company to excited solid believe So, very there launch. the think

In milestone commercial upon launch. receiving addition sales there royalties be that payment, Journey to their are will this

So, well that for well. as bodes us

Brandon Folkes

progress congratulations Thanks Great. I much. months. the very the on insight, XX appreciate and the over

Claude Maraoui

you. Thank

Operator

ahead. Henry next Capital. Scott question ROTH from Our Please comes with go

Scott Henry

couple A you, Thank afternoon. questions. and good of

I heard have million, thought $X.X give us sales? to wanted First, I just Targadox confirm you that. I but might did clarity, for

Claude Maraoui

the No, call. on we sales give didn’t Targadox

Scott Henry

Would to give, you like Ernie?

Ernie De Paolantonio

Give that earnings. have one me I second.

it, have I So it’s $X.X million.

Scott Henry

Thank great. then that for just other you Okay, And clarity. a couple questions.

XXX that that patients, first trials, DFD-XX, or on two is is the trial? the for First, for

Claude Maraoui

each That’s going Scott. in both for XXX are to is And two trials. there be underway, They trial.

Scott Henry

That’s I what expected. Yes.

run out are they same And the just that Is at read the should there? simultaneously. So, idea they time.

Claude Maraoui

will That’s separated the be time. at data in weeks correct. be there But Yes. the They two together maybe were will about all end.

Scott Henry

Qbrexza EBITDA, go Okay, number. a the adjusted great. want expect up guess the $X.X I I to which get million And now, royalties you sequentially expect target? to down? you be year generalities, how, with pretty that expect trials, a is any Can that won’t the number adjusted EBITDA kind going us where growing those just on thought a anyways, would Maybe good on of to reflect from be in But strong? to would give should you then that of I the sense R&D just that

Claude Maraoui

Yes.

along we go also that earlier, and VYNE be that, up. the said other see products we and expect again, As number transaction other Qbrexza to to we or expect Accutane our increase the will accretive our increase, would friends number you with as that

Scott Henry

base to there before bought out Okay. it bring And expect be to weren’t ZILXI, where to obviously, are with would come would out would those see you then guess transitional to you your benefits trying to are AMZEEQ out. When I bottomed you probably probably have and and we that you starts very start efforts growth? a them and to they products them, the marketed But heavily reconvene? and to expect bottom just expect transition. traction they stage of I when growth already through. the with before the

Claude Maraoui

we and me excuse mid-January, have bring Scott, with the it them to XPA products did that samples we around bit sales we get and products we the sales a with around call as executed we to soft can, a quickly try of got officially the what do force, marketing the two possible. our continuity That We mid-January. Yes. the launch. was VYNE deal Sure. to materials out tried as that. that right. way That’s the little weeks the took when into We just get can over

in sales of just we force So, year AMZEEQ their dermatologists, doors nurse the of cut last started XXXX. of back August really the that the been practitioners knocking and and VYNE the targets PAs ZILXI. in had on using

on April, we And just just hard just we door, So, a went knocking consider giving we reminders. into the in launch. started what really

start see April prescriptions going we up. if really month after in when you picking full will in we start understanding in aren’t to the trends really have getting things think month this out May, terms of of prescriptions, AMZEEQ, start see nice month-over-month. at onward. yet. And In growth example, we a February, But were June here incremental still X,XXX these towards of approximately here general in numbers, you So, already ZILXI. XX,XXX numbers pickup look those with happen April And products, March, with we And have prescriptions. for were But will seen how of Symphony should we uptick. as will believe trends will, we be to to these a with to us I well products up a and see some

Scott Henry

just of a you that Okay, question, use fair you like that mind have be balance debt markets, $XX capital what mean to company, guys, it would should equity But every choose context the it’s always enough the number to. you seem final think There balance wouldn’t may with just sheet? I to, people’s for that of million, million mean when working we lot or that $XX go to because of would definitely great. flexibility. in you you And say lot is give I cash but could to about, on top the have don’t need is the you business. this of a you we any see should on can sort

Ernie De Paolantonio

it our development in DFT-XX if plans and and to don’t to Scott, right mainly the operating other fund launch. BD our includes raise go And money $XX which the capital. million from was change now, always. But any we in the plan, we as we from any the to could something comes out current don’t to have Yes, capital. for have IPO market raise plans That

Scott Henry

Okay, for That Thank taking great. for should me. you do the questions. it

Claude Maraoui

Thanks Scott.

Ernie De Paolantonio

Thank you.

Operator

to would This question-and-answer over concludes for session. back Maraoui closing the remarks. the turn like call to I Claude

Claude Maraoui

our for a everyone we look participating sharing in progress results We and in you and Thank your Journey our call Thanks quarter Excellent. Medical. have for forward report day. to when ongoing today’s good in August. interest second

Operator

for now is conference attending Thank concluded. you today’s The presentation.

may disconnect. now You

Journey Medical (DERM) 15 May 222022 Q1 Earnings call transcript