HARROW, INC. Q1 FY2025 earnings call

Management Statement and Operational Highlights:

• Growth Drivers: Harrow grew revenues 38% YOY in Q1 2025, with VEVYE revenue up 35% sequentially. Completed market access initiatives for TRIESENCE.
• Expenses: First quarter challenged by one-time expenses totaling $3.7 million, including audit costs and a special project. Continued investment in commercial infrastructure, with VEVYE sales/marketing team over 80 and IHEEZO/TRIESENCE buy/bill team near 50.
• Product Updates: VEVYE outperforming expectations, IHEEZO back in growth mode after destocking, TRIESENCE market access initiatives unlocking significant market potential, and ImprimisRx compounding business strong in April.

Segment Performance:

• VEVYE: Revenue rose 35% sequentially from $16 million in Q4 2024 to $21.5 million in Q1 2025. The VEVYE Access for All program launched at the end of Q1.
• IHEEZO: First quarter sales impacted by stocking, but normalized with destocking in Q1; unit sales more than doubled in April.
• TRIESENCE: Completed critical market access initiatives in Q1, unlocking about 40% of the market, with sales momentum accelerating in Q2; number of accounts ordering TRIESENCE doubled since the start of the year.
• Specialty branded products: Softer in Q1 but picking up in Q2 due to improved market dynamics.
• ImprimisRx compounding business: Consistent performer, with April appearing to be a record month, demonstrating strong revenue and operational reliability.

Guidance:

• 2025 revenue guidance exceeds $280 million, with $232 million needed in remaining quarters.
• VEVYE expected to generate at least $100 million, IHEEZO over $50 million, Specialty branded products (including TRIESENCE) at least $50 million, and ImprimisRx over $80 million.
• Anticipate quarter-over-quarter growth, with Q3 and Q4 expected to be stronger, particularly Q4.

Risks:

• Risks related to FDA approval timelines for products and drug candidates.
• Commercial execution risks, including challenges in transitioning compounding products to prescriptions.
• Negligible impact from current tariff policy, but potential challenges in commercial operations remain.

Question and Answer: Q: Thomas Flaten asked about price increase initiatives for IHEEZO.

A: Andrew Boll stated there were no price increases for IHEEZO, and Mark Baum mentioned earlier price decreases to make products more accessible.

Q: Chase Knickerbocker inquired about IHEEZO stocking and TRIESENCE volumes.

A: Andrew Boll discussed unit demand normalization for IHEEZO, and Mark Baum talked about TRIESENCE market access unlocking 40% of the market and account growth.

Q: Jeffrey Cohen asked about the compounding business transition.

A: Mark Baum discussed ImprimisRx's role in commercial credibility and transitioning Klarity-C patients to VEVYE.

Q: Yi Chen asked about VEVYE average collection cycle and tariff impact.

A: Andrew Boll discussed revenue recognition related to VEVYE and Mark Baum mentioned negligible tariff impact.

Q: Mayank Mamtani asked about VEVYE patient transition and debt refinancing.

A: Mark Baum talked about the impact of the VEVYE Access for All program, and Andrew Boll discussed positive debt refinancing discussions with lenders.