Journey Medical (DERM) Q2 2024 earnings summary

Executive summary

• Net product revenue for Q2 2024 was $14.9 million, up 14% sequentially from Q1 2024 but down 12–13% year-over-year, mainly due to lower QBREXZA sales, higher rebates, generic competition, and product discontinuations.

• Core dermatology brands generated over 90% of revenue, with QBREXZA and Accutane showing prescription and market share growth year-over-year, while Accutane revenue grew 3% in Q2 2024.

• Net loss for Q2 2024 was $3.4 million ($0.17/share), a 60% improvement from $8.4 million ($0.46/share) in Q2 2023, driven by reduced operating expenses.

• Achieved fourth consecutive quarter of positive non-GAAP Adjusted EBITDA, reaching $0.3 million in Q2 2024.

• DFD-29 NDA accepted by FDA, with PDUFA date set for November 4, 2024; milestone and filing fees impacted R&D costs.

Financial highlights

• Q2 2024 net product revenue was $14.9 million, down from $17 million in Q2 2023, but up $1.8 million sequentially from Q1 2024.

• Gross profit margin improved year-over-year to approximately 56%, due to product mix, lower QBREXZA royalties, and declining cost of goods sold.

• GAAP net loss to common shareholders was $3.4 million (17 cents/share) in Q2 2024, improved from $8.4 million (46 cents/share) in Q2 2023.

• Non-GAAP Adjusted EBITDA was $0.3 million in Q2 2024, compared to a $6 million loss in Q2 2023.

• Ended Q2 2024 with $23.9 million in cash and cash equivalents.

Outlook and guidance

• On track to achieve 2024 guidance: net product revenue of $55–$60 million, SG&A expense of $39–$42 million, and R&D expense of $9–$10 million.

• Targeting DFD-29 launch in late Q1 or early Q2 2025, with initial distribution planned for March.

• SG&A expected to remain stable around $9–$10.3 million per quarter, with only modest increases for DFD-29 launch.

• EBITDA positive targeted for 2025.

• Substantial doubt remains about ability to continue as a going concern due to recurring losses and cash burn.