Fortress Biotech, Inc. Q4 FY2024 earnings call

• 2024 was a pivotal year with $56 million in annual revenue, sixth consecutive quarter of positive non-GAAP adjusted EBITDA, and Emrosi NDA submitted and FDA approved in November.
• Paid $22 million in one-time FDA filing fees and milestones to Dr. Reddy Labs, clearing way for Emrosi launch with $20.3 million cash on hand.
• Presented Emrosi clinical data at key medical congresses. Cutia's Amzeeq approval in China triggered $1 million milestone payment.
• 2025 started strong with a productive exhibit at the 2025 AAD Conference, generating customer interest in Emrosi's FDA approval and Phase 3 results.
• National sales meeting upcoming, launch quantities in place, and precommercial update showing progress in payer coverage.

In 2024, total net product revenue was $55.1 million, down from $59.7 million in 2023. The decrease was due to higher rebate costs and lower unit volumes of legacy products. Total revenues for 2024 were $56.1 million, including a $1 million milestone payment from Cutia Therapeutics for Amzeeq's China approval. Cost of goods sold decreased by $2 million to $20.9 million. Research and development expenses increased to $9.9 million due to NDA filing fees and milestones. SG&A expenses decreased to $40.2 million. Net loss to common shareholders was $14.7 million. Non-GAAP adjusted EBITDA was positive $800,000.

• 2025 guidance will be provided later in the year after assessing Emrosi prescription demand and payer contract negotiations.

Q: On payer coverage, what to expect ending 2025?

A: Goal is to obtain covered lives, peak commercial coverage expected in 12-18 months. Market access lead Louis Donati notes ramp up with peak coverage 12-18 months post launch.

Q: Thoughts on 2025 guidance?

A: Guidance will be provided after Emrosi launch, national sales meeting, and assessing commercial team feedback.

Q: Pricing across portfolio and capital allocation in 2025?

A: Legacy brands like Exelderm and Targadox have competitive dynamics; Exelderm margins improved as royalty obligations ended. Capital allocation focuses on cash comfort with Emrosi launch.

Q: Milestones for Emrosi launch and payer formularies?

A: Key milestones include supply, distribution, and formulary coverage. Progress seen in payer response with 20% commercial coverage, and market access team working on ramp up.

Q: Peak coverage percentage for Emrosi and covered lives breakdown?

A: Peak coverage in 12-18 months, 20% commercial coverage includes various lives with positive payer response, step edits through generic/oral agents, and no pricing movement from Galderma for Oracea since Emrosi launch.