Journey Medical Corp. Q4 FY2024 earnings call

Key Achievements in 2024 - Journey Medical met all 2024 guidance ranges, reporting $56 million in annual revenue and achieving the sixth consecutive quarter of positive non-GAAP adjusted EBITDA. - Submitted the new drug application (NDA) for MROSI in early 2024 and received FDA approval in November. - Paid $22 million in FDA filing fees and milestone payments to Dr. Reddy Labs, clearing the way for MROSI's commercial debut. - Balance sheet remained strong with $20.3 million in cash as of December 31. - Presented MROSI clinical data at key medical congresses. - License partner Cutia Therapeutics received regulatory approval for AmZEEK in China, triggering a $1 million milestone payment to Journey. ### 2025 Highlights - Had a productive exhibit booth at the 2025 AAD Conference in Orlando, generating significant customer interest in MROSI. - National sales meeting kicks off next week, with launch quantities in place and shipping already underway. - Anticipates two more peer-reviewed publications on MROSI in 2025.

In 2024, total net product revenue was $55.1 million, which was a decrease from the $59.7 million in 2023. The reduction was mainly due to higher rebate costs across the product portfolio and lower unit volumes from legacy products. Total revenues for 2024 were $56.1 million, including a $1 million milestone payment from Cutia Therapeutics upon its market authorization of AmZEEK in China. Cost of goods sold decreased by $2 million to $20.9 million. Research and development expenses increased by $2.3 million to $9.9 million. Selling, general, and administrative (SG&A) expenses decreased by $3.7 million to $40.2 million. The net loss to common shareholders was $14.7 million. Non-GAAP adjusted EBITDA was a positive $800,000. Cash and cash equivalents stood at $20.3 million as of December 31, 2024.

2025 Guidance - Journey Medical plans to provide 2025 financial guidance later in the year after evaluating initial MROSI prescription demand and payer contract negotiations. - Will wait for the full impact of the commercial team's efforts and the progress of the MROSI launch before issuing formal guidance.

Q: What can be expected for payer coverage exiting 2025?

A: The goal is to secure as many covered lives as possible, with peak commercial coverage anticipated in 12 to 18 months. The market access team is actively working, and peak coverage will increase over time with demand.

Q: Thoughts on 2025 guidance or the plan to initiate it?

A: Will wait a few more months as the MROSI launch progresses, with the national sales meeting next week and the full commercial team in place, then provide guidance later.

Q: How is the reimbursement environment in the early days of MROSI?

A: Prescription distribution is underway, but coverage and reimbursement are in the early stages with limited data points. However, 20% commercial coverage is on target as of now.

Q: How to consider pricing across the portfolio in 2025?

A: For legacy brands such as Exelderm and Targadox, pricing is expected to remain stable. Exelderm has better margins as royalties are no longer paid. The net pricing of the core four brands is expected to stay the same as observed.

Q: What are the milestones for the MROSI launch and how to track the outlook?

A: Key milestones include having ample supply, in-place distribution, and obtaining more formulary coverage. Reimbursement and formulary coverage are the main aspects to track, with progress expected within 12 to 18 months.

Q: What about the international opportunity for MROSI and out-licensing?

A: Journey Medical aims to out-license MROSI internationally, focusing first on achieving success in the US market. The business development strategy is to out-license the product.

Q: Peak coverage percentage for MROSI and breakdown of covered lives?

A: Peak coverage for MROSI has not been specified yet. Currently, 20% commercial coverage includes various lives with a mix of unrestricted and restricted access, and payer response has been positive with some unrestricted access. The step mandated by payers is through generic oral agents like minocycline and/or doxycycline. There have been no pricing moves by Galderma for ORATIA since MROSI's launch.