VYNE Therapeutics Inc. Q2 FY2020 earnings call

• Launched AMZEEQ at the start of the year, with prescription trends showing recovery despite pandemic disruption.
• FDA approved ZILXI in the second quarter for treating inflammatory lesions of rosacea in adults, with plans to launch in Q4.
• Phase II trial of FCD105 (minocycline and adapalene foam for acne) showed positive results, with plans to meet with FDA for Phase III development.
• Raised $54 million in equity offering, increasing cash balance to over $100 million at quarter end.
• Amended credit agreement to extend revenue covenants by six months.
• AMZEEQ had 22,169 total prescriptions in Q2, with 7.3% growth vs Q1, and strong recent recovery in prescriptions.
• ZILXI launch preparation is on schedule, leveraging existing commercial infrastructure.

Revenues for the second quarter of 2020 totaled $11.7 million. This included $1.5 million from AMZEEQ product sales, $10 million from the upfront cash payment under the Cutia license agreement, and $0.2 million in royalty revenue. The net loss for the second quarter was $167.4 million compared to $19 million in the comparable period of 2019. Non-cash expenses included $148.3 million in one-time items, such as $54.3 million in non-cash transaction expenses related to merger-related impairments and $84.7 million related to contingent stock rights conversion.

• Believes cash runway extends through end of 2021 without need for additional debt/equity financing due to cost savings and current cash position.
• Credit agreement minimum revenue covenants pushed out six months.
• Cost savings initiatives' benefits expected to be reflected in Q3 financials, with Q4 representative of new cost structure.

• COVID-19 impact on market recovery, including continued impairment of representative access and office shutdowns affecting sample velocity.
• Uncertainty in payer contracting timelines and dynamics, which could impact product launch and coverage.
• Uncertainty in cash runway projection due to ongoing impact and potential future impact of COVID-19.

Q: Gross-to-net on AMZEEQ and sampling volumes?

A: Andrew Saik and Matthew Wiley noted it's early to comment on gross-to-net, but covered prescriptions are growing, sampling velocity is increasing with more samples going out to offices.

Q: Reverse split and cash runway with COVID persistence?

A: Andrew Saik said shareholders approved reverse split proposal, and cash runway is expected through end of 2021 with sufficient funds assuming COVID doesn't persist excessively