Veru Inc (VERU) Q3 2024 Earnings Call Highlights: Strategic Cost Management and Revenue Growth ...

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Wed, Oct 9, 2024, 3:27 PM 4 min read

Net Revenue: $4 million for Q3 2024, up from $3.3 million in Q3 2023.
US Prescription Business Revenue: $552,000, down from $863,000 in Q3 2023.
Global Public Sector Business Revenue: $3.4 million, up from $2.5 million in Q3 2023.
Gross Profit: $1.3 million or 34% of net revenues, compared to $1.2 million or 37% in Q3 2023.
Operating Expenses: Decreased to $12.4 million from $19.7 million in Q3 2023.
Research and Development Costs: $4.9 million, down from $8.8 million in Q3 2023.
Selling, General and Administrative Expenses: $7.5 million, down from $10.9 million in Q3 2023.
Operating Loss: $10.9 million, compared to $13.7 million in Q3 2023.
Net Loss: $11 million or $0.07 per diluted share, compared to $12.5 million or $0.14 per diluted share in Q3 2023.
Cash Balance: $29.2 million as of June 30, 2024.
Cash Used in Operating Activities: $5.6 million for Q3 2024.

Warning! GuruFocus has detected 4 Warning Signs with VERU.

Release Date: August 08, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Veru Inc (NASDAQ:VERU) has completed enrollment for its Phase 2b clinical trial for enobosarm, with top-line results expected in January 2025.
The company has a strong cash position of $29.2 million as of June 30, 2024, which is expected to be sufficient to complete ongoing clinical trials.
Veru Inc (NASDAQ:VERU) reported an increase in net revenues to $4 million for the third quarter, up from $3.3 million in the prior year.
Operating expenses decreased significantly to $12.4 million from $19.7 million in the previous year, reflecting cost management and strategic focus.
The company is exploring partnerships for further development and commercialization of its drug candidates, indicating potential future growth opportunities.

Negative Points

Veru Inc (NASDAQ:VERU) reported a net loss of $11 million for the third quarter, although this was an improvement from the previous year's loss.
The company's US prescription business saw a decline in sales, contributing to a decrease in gross margin from 37% to 34%.
There is uncertainty regarding the success of the Phase 2b trial for enobosarm, as the results are pending and critical for future development plans.
The company faces challenges in its US prescription channel due to the bankruptcy of a major customer, impacting revenue streams.
Veru Inc (NASDAQ:VERU) is dependent on securing additional external funding or partnerships to advance its oncology and infectious disease pipeline.

Q & A Highlights

Q: Assuming positive results from the Phase 2b quality study, how soon can you advance the candidate to the next step, and do you plan to find a partnership for a potential registration study? A: Assuming positive results, we expect to have the Phase 2b quality clinical trial data by January 2025. This data will allow us to engage with the FDA and potential partners. We have already initiated discussions with major players, and having real data will enable more concrete discussions on regulatory and partnership fronts.

Q: In the trials referenced with enobosarm, the high dose was 3 milligrams. What gives you confidence that the 6-milligram dose will be safe, especially considering liver health? A: We have conducted studies with doses as high as 100 milligrams and have data from nearly 250 patients at 9 and 18 milligrams in our breast cancer program, with no evidence of liver toxicity. Additionally, enobosarm has shown a 30% reduction in triglycerides, which may benefit patients with fatty liver. We monitor alcohol intake during the study but do not exclude it.

Q: Can you discuss the progress of the Phase 2b study now that it's fully enrolled, and should we expect any updates before the top-line results in January? A: The study is fully enrolled, and the last patient is expected to complete the study in December. The next update will be the top-line data in January. We are pleased with the safety profile so far, although many patients are still early in their treatment.

Q: What can we expect in terms of top-line data in January? Will it include details on body weight loss, fat loss, and functional improvements? A: The top-line data will focus on body composition, specifically lean body mass and total fat mass, to determine the optimal dose for muscle preservation and fat reduction. Additional details may be shared at scientific meetings shortly after the initial data release.

Q: Regarding the Phase 3 study, will it focus on elderly patients or a broader obesity population? A: The FDA has indicated that a muscle preservation drug could benefit all patients with obesity or overweight, not just the elderly. The Phase 3 study will likely include all comers, with a focus on body weight as the primary endpoint and functional endpoints as key secondary measures. The study will be powered to assess outcomes in both the overall population and a subgroup of older patients.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.

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