Release Date: April 09, 2025

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

Positive Points

• Theratechnologies Inc (NASDAQ:THTX) reported a 17% growth in total revenues, reaching $19 million for the first quarter of 2025.
• The company's lead asset, GriftaSV, showed strong market momentum, contributing significantly to revenue growth.
• The new F8 formulation of Tessam Morland was approved, offering improved patient experience with once-weekly reconstitution.
• The company successfully resumed distribution of AgriftaSV after a temporary drug shortage, with patient numbers rebounding.
• Theratechnologies Inc (NASDAQ:THTX) achieved a positive adjusted EBITDA of $2.3 million, a significant improvement from the previous year's loss.

Negative Points

• The temporary drug shortage of AgriftaSV resulted in a sales loss of 6 to 7 weeks, impacting revenues by approximately $10 million.
• Q2 revenues are expected to be affected due to larger-than-usual orders at the end of Q1, leading to a longer drawdown period.
• Net sales of Trogarzo decreased by 22% year-over-year due to new competitors, with expectations of stabilization at lower levels.
• Selling expenses increased by 10% compared to the previous year, driven by higher stock-based compensation and professional fees.
• The company faces challenges in transitioning from AgriftaSV to AgriftaWR, with potential payer-related issues during the transition period.

Q & A Highlights

• Warning! GuruFocus has detected 4 Warning Signs with THTX.

Q: Are you looking for new products in the same therapeutic areas, and would you consider acquiring drugs that are already approved or in-licensing late-stage drug candidates? A: (Paul Leveck, CEO) We aim to make acquisitions that are accretive and focus on very late-stage drugs with a high chance of approval. Our priority is to find products that fit our current infrastructure to drive synergies, especially in the U.S. where we have a strong presence in community infectious disease. (John Leisure, Global Commercial Officer) We are exploring opportunities in synergistic areas and have identified potential targets, including assets already on the market.

Q: How do you plan to facilitate the transition from Agrifta SV to Agrifta WR, and what is the expected timeline? A: (Paul Leveck, CEO) The transition needs to be well-orchestrated to avoid issues with payers. We plan a transition period similar to our previous experience from F1 to F4. (John Leisure, Global Commercial Officer) The process involves manufacturing and packaging the new product, updating pricing and NDC numbers, and managing the transition through our patient support program. We expect a transition period of about six months.

Q: What are your medium to long-term expectations for growth in the Agrifta franchise? A: (Paul Leveck, CEO) The recognition of excess visceral abdominal fat as a cardiovascular risk factor is driving demand. We are seeing strong recovery post-drug shortage, indicating relevance. (John Leisure, Global Commercial Officer) Enrollments are up 15% year-to-date, and unique patients have bounced back, suggesting continued growth.

Q: Why is there a continued negative impact on Trogarzo sales, and when do you expect stabilization? A: (John Leisure, Global Commercial Officer) The decline is due to losing more patients than gaining, despite stabilized enrollments. However, enrollments are up 16% year-to-date, indicating stabilization in utilization.

Q: Do you foresee any tariff impacts on Trogarzo or the Iona products? A: (Paul Leveck, CEO) We do not anticipate issues with Trogarzo due to transfer pricing. (Philippe Debuk, CFO) The Iona products are manufactured in Europe and won't pass through the U.S. border, so we don't see any tariff risks.

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