In This Article:
Release Date: November 12, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Heron Therapeutics Inc (NASDAQ:HRTX) reported a significant increase in product gross profit margin to 71% for Q3 2024, up from 42% in the same period in 2023.
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The Crosslink partnership is showing early positive results, with nearly 40,000 ZYNRELEF units ordered since April, contributing approximately $4.4 million in net revenue.
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The company has successfully integrated its business units under the One Heron initiative, leading to increased cooperation and efficiency among teams.
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CINVANTI continues to provide a strong foundational base for the company, maintaining around a 20% market share despite a competitive environment.
Negative Points
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Total acute care net revenues for the quarter were relatively low at $7.4 million, indicating room for growth.
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Net revenues for CINVANTI and [CTOL] were down from Q2, highlighting challenges in maintaining consistent sales in a competitive market.
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The company experienced a net loss of $4.8 million for Q3 2024, although this was an improvement from the previous year.
Q & A Highlights
Q: Now that VAN is approved, how should we think about the curve moving forward, and what is your anticipation of the customer mix between existing and new users? A: Craig Collard, CEO: We anticipate having VAN in the market by the first week of December. Initially, we'll focus on a few accounts to ensure a smooth launch. We'll target accounts that previously had issues with product preparation and new accounts brought on by Crosslink. We're excited about VAN's potential to address long-standing issues like prep time and sterility.
Q: Can you comment on the nuances in the third quarter regarding the sequential decline in CINVANTI and your outlook for the fourth quarter? A: Craig Collard, CEO: CINVANTI operates in a competitive market with fluctuations due to account changes. We lost a large account in Q3, impacting revenues. However, our "One Heron" approach is helping us gain traction, especially in 340B hospitals, and we expect a strong bounce back in Q4 and into next year.
Q: OpEx took a dip in Q3. Is this a new baseline, and do you still expect a court decision on the litigation by the end of the year? A: Craig Collard, CEO: The OpEx dip is due to efficient management and timing, not a new baseline. Regarding litigation, we feel confident about winning the case, with a resolution expected by December 14. We anticipate a favorable outcome, extending patent protection to 2035.