- Record Q2-24 revenues of $14.1 million, up 4% over Q2-23 outpacing revenue softness in several non-core brands
- Q2-24 adjusted EBITDA loss of $2.5 million compared to $1.7 million for Q2-23, up 48%
- Total Enerzair and Atectura prescriptions for the 12 months ending April 30, 2024, exceeded 88,000, up 96% over the 12 months ending April 30, 2023
MONTREAL, June 13, 2024 /CNW/ - Valeo Pharma Inc. (TSX: VPH) (OTCQB: VPHIF) (FSE: VP2) ("Valeo" or the "Company"), a Canadian pharmaceutical company, today reported its financial results for the second quarter ended April 30, 2024.
Second quarter 2024 Results & Highlights:
- Revenues of $14.1 million in Q2-24 vs $13.6 million in Q2-23, up 4% respectively
- YTD-24 revenues of $27.7 million vs. $26.7 for 2023, up 4%
- Adjusted gross profit of $3.4 million in Q2-24 vs $4.7 million in Q2-23, down 27%
- Q2-24 net loss of $7.8 million vs $6.5 million in Q2-23, up 21%
- Adjusted EBITDA loss of $2.5 million for Q2-24 vs $1.7 million loss in Q2-23, up 48%
- Enerzair and Atectura prescribing physicians reached 3891 at the end of Q2-24, a 91% increase year-over-year.
- Total Enerzair and Atectura prescriptions for the 12 months ending April 30, 2024, exceeded 88,000, up 96% over the 12 months ending April 30, 2023
"While we achieved record revenues in our second quarter, the top line results don't give a full picture of the progress that we are making. Revenue softness in a number of our non-core brands coupled with short term structural delays in Ontario affecting Redesca masked the strong performance of our asthma franchise with their Q2 revenues increasing 52% over the same quarter last year", said Steve Saviuk, CEO. "Earlier today we announced a significant and well thought out restructuring of our respiratory commercial field operations. This will yield significant savings going forward while allowing us to continue to support the trajectory of our sales growth for that unit. These challenging but necessary changes were needed to place us on a sustainable footing while simultaneously positioning us solidly on a path to profitability".
Commenting on the second quarter 2024 results, Pascal Tougas, Valeo's Chief Financial Officer, said, "Our core brands continue to play a central role in quarterly sequential revenue growth. Gross profit was temporarily eroded in the first half of 2024 resulting from a specific product mix and the expected declining contribution from XIIDRA. We see growing momentum on core assets and progressively improving product mix that will help reposition the Company on an upward trajectory for the second half of the year. We also expect our operating losses to continue improving as announced measures continue yielding reduction in operating expenses and allow to improve alignment with market dynamics.'
Second Quarter 2024 Financial Results
- Revenues were $14.1 million for the second quarter ended April 30, 2024, compared to $13.6 million for the second quarter ended April 30, 2023, representing a 4% increase. Valeo revenue growth mainly resulted from sales uplift generated via promotional activities in respiratory, Allerject and continued growth from other core products, such as Redesca, Simbrinza;
- Adjusted gross profit was $3.4 million for the second quarter ended April 30, 2024, compared to $4.7 million for the second quarter ended April 30, 2023, representing a 27% decrease. The $1.3 million decrease over the previous comparable period is mainly due to a declining Xiidra contribution of $0.8 million versus same quarter year over year;
- Net loss was $7.8 million for the second quarter ended April 30, 2024, compared to $6.5 million for the second quarter ended April 30, 2023. The 21% increase in net loss in Q2-24 mainly results from a combination of i) Gross profit diluted by eroding Xiidra contribution and ii) transformation costs (supported under G&A) in Q2-24 in the amount of $0.5 million;
- Adjusted EBITDA loss was $2.5 million for the second quarter ended April 30, 2024, compared to $1.7 million for the second quarter ended April 30, 2023, a 48% deterioration.
Year to Date 2024 Financial Results
- Record YTD Revenues of $27.7 million for the six months ended April 30, 2024 compared to $26.7 million for the six months ended April 30, 2023 representing a 4% increase;
- Adjusted gross profit was $7.2 million for the six months ended April 30, 2024 down 28% compared to $8.6 million for the six months ended April 30, 2023;
- Net loss of $14.7 million for the six months ended April 30, 2024 compared to $12.7 million for the six months ended April 30, 2023. The increase in net loss is mainly due to the increase in financial and sales and marketing expenses, which was partly offset by the significant increase of our gross profit; and
- Adjusted EBITDA loss of $4.7 million for the six months ended April 30, 2024 compared to an adjusted EBITDA loss of $3.9 million for the six months ended April 30, 2023, a 9% deterioriation.
Second Quarter 2024 Highlights
- In February 2024, the Company announced the appointment Messrs. Robert Raich and Charles Bisaillon to the Company's Board of Directors and that Messrs. Michel Trudeau, Stuart Fowler, Didier Leconte and Ms. Tamara Close have all resigned from its Board of Directors.
- In February 2024, the Company entered into an amendment of its 7-year Commercialization and Supply Agreement of XIIDRA® and SIMBRINZA®. As per the Amendment, Valeo will continue to distribute XIIDRA® for the entire transition period. The transition period is expected to continue until approximately Q3-2024. Valeo will continue to commercialize and promote SIMBRINZA® on an exclusive basis as provided by the Commercial and Supply Agreement with Novartis. Within 60 days from the Effective Date of Termination, Valeo will be entitled to a reimbursement of a residual portion of the upfront fee paid by Valeo at the time it entered into the Commercialization and Supply Agreement. The amount to be received as Reimbursement, when received, will be used for partial repayment of the Secured Term Loan (the "Facility') entered into between Valeo and Sagard Healthcare Royalty Partners, LP ("Sagard") in July 2022.
- In February 2024, the Company also entered into an agreement with Sagard to provide, among other things, for accelerated debt repayment of the Facility. Under the Sagard Amendment, Valeo will be required to make a first repayment of $10 million by August 31, 2024 and will also have the option to make an additional repayment of US$5 million under the Facility, which amount is currently held in a restricted cash account; and
- On February 23, 2024, the Corporation entered into an agreement to assign the rights to a non-core asset for gross proceeds consideration of $1.5 million materialized in Q2-2024.
- In March 2024, the Company announced the appointment of Mr. Al Moghaddam to the Company's Board of Directors. Mr. Moghaddam is a customer centric transformational life sciences leader with over 25 years of global experience. His work experience spans from large multinationals through to early-stage companies and he has held leadership positions within pharma, medical device, med-tech, and consumer markets. He is a strong visionary, process driven leader, able to craft a vision and motivate teams to achieve superior results and recognized by such companies as Allergan, Bristol Myers Squibb, Teva & Pharmascience for outstanding performance in creating value. He has cross functional experience in product life cycle management, sales, BD&L, market access, marketing, finance & M&A.
Second Quarter 2024 Subsequent Events
- In May 2024, the Company confirmed that the effective date of termination regarding the XIIDRA partial termination agreement previously entered into was set at May 30, 2024, rather than the date of the marketing authorization transfer; and
- In June 2024, the Company announced the restructuring of its respiratory commercial field operations aimed at reducing its operating expenses, aligning its commercial infrastructure with current market dynamic and accelerating its path to profitability with cost reduction measures, affecting approximately 20% of its workforce, to decrease its operating expenses by more than $5 million on an annualized basis.
Second Quarter 2024 Webcast and Conference Call
Valeo will host a conference call to discuss its second quarter 2024 results and highlights on Friday June 14, 2024, at 8.30 am (ET). The telephone numbers to access the conference call are 416-764-8659 and 1-888-664-6392. An audio replay of the call will be available. The numbers to access the audio replay are 416-764-8677 and 1-888-390-0541 using the following access code (150417 #).
A live audio webcast of the conference call will be available via:
https://app.webinar.net/lmwv2P42DyQ
Financial Statements and MD&A
Valeo Pharma's financial statements and Management's Discussion and Analysis for the three-month and six-month periods ended April 30, 2024, are available on SEDAR at www.sedar.com.
About Valeo Pharma
Valeo Pharma is a Canadian pharmaceutical company dedicated to the commercialization of innovative prescription products in Canada with a focus on Respiratory/Allergy, Ophthalmology and Hospital Specialty Products. Headquartered in Kirkland, Quebec Valeo Pharma has all the required capabilities and the full infrastructure to register and properly manage its growing product portfolio through all stages of commercialization. For more information, please visit www.valeopharma.com and follow us on LinkedIn and Twitter.
Forward Looking Statements
Forward-looking statements are statements and information regarding possible events, conditions or results of operations that are based upon assumptions about future economic conditions and courses of action. All statements and information other than statements of historical fact may be forward-looking statements. In some cases, forward-looking statements can be identified by the use of words such as "seek", "expect", "anticipate", "budget", "plan", "estimate", "continue", "forecast", "intend", "believe", "predict", "potential", "target", "may", "could", "would", "might", "will" and similar words or phrases (including negative variations) suggesting future outcomes or statements regarding an outlook.
Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from those expressed or implied by such forward-looking information, including but not limited to: reliance on third-party suppliers and manufacturers, the availability of additional funding, common risks for pharmaceutical products, including product liability claims, insurance and recalls, registration risks in certain jurisdictions, the inability to implement Valeo's strategy to grow the business, dependence on key management personnel and executives, competition, currency fluctuations and the risks, uncertainties and other factors contained in the section entitled "Risk Factors" in Valeo's annual information form dated January 29, 2024, a copy of which is available on Valeo's Sedar+ profile at www.sedarplus.ca.
Actual events or results may differ materially from those anticipated in these forward-looking statements if known or unknown risks affect Valeo's business, or if Valeo's estimates or assumptions turn out to be inaccurate. Valeo undertakes no obligation to update publicly, or otherwise revise, any forward-looking statements, whether as a result of new information or future events or otherwise, except as may be required by law. If Valeo does update one or more forward-looking statements, no inference should be drawn that it will make additional updates with respect to those or other forward-looking statements, unless required by law.
SOURCE Valeo Pharma Inc.
For more information: Steve Saviuk, CEO, 514-693-8830, [email protected]; or Pascal Tougas, Chief Financial Officer, 514-693-8854, [email protected]; or Frederic Dumais, Director, Communications and Investor Relations, 514-693-8847, [email protected]
