TherapeuticsMD shares are trading higher after the company reported better-than-expected Q1 sales results. – Idaho Reporter

Investments, NASDAQ

TherapeuticsMD shares are trading higher after the company reported better-than-expected Q1 sales results.

TherapeuticsMD, Inc. (NASDAQ: TXMD) disclosed its Q1 financial results for the first quarter ended March 31, 2020

“I would like to thank our team for delivering a successful quarter during a challenging time. We have made significant progress across the business,” said Robert G. Finizio, Chief Executive Officer of TherapeuticsMD. “We delivered a solid quarter in revenue. Recently, we extended the value of our lead asset, ANNOVERA, with the first Orange Book listed patent, and revised our strategic priorities and significantly reduced our operating cost structure, bringing us closer to achieving EBITDA break even in 2021.”

First Quarter & Recent Highlights

The Company continued to evaluate its strategy and commercial infrastructure as the impact of COVID-19 persisted. Our strategy remains the same: to drive revenues by prioritizing ANNOVERA® (segesterone acetate and ethinyl estradiol vaginal system) as the lead product, IMVEXXY® (estradiol vaginal inserts) in the second position and BIJUVA® (estradiol and progesterone) in the third position. The Company’s approach is straightforward, reallocate resources towards those products and initiatives that drive the fastest revenue growth, while reducing overall operating expenses. Total operating expenses excluding non-cash items for the first quarter of 2020 were approximately $57.5 million. The Company has initiated measures to reduce its operating expenses for the second quarter by approximately $10 million to $12 million and plans to further reduce total operating expenses to approximately $40 million or below for the third and fourth quarters of 2020. The Company’s goal still remains to achieve EBITDA break even in 2021.
Due to the uncertainty created by COIVD-19 and its impact, the Company has been in discussions with TPG Sixth Street Partners (“Sixth Street”) regarding the revenue covenants in the loan document. The Company is working with Sixth Street to defer the scheduled start of the quarterly revenue covenant for two to three quarters to reflect the impact of COVID-19. Sixth Street has expressed preliminary support and while there is currently no final agreement or obligation, they understand the importance of flexibility for our Company at this time.
Net product revenue for the first quarter of 2020 was $12.3 million. The Company anticipated that net revenue would be lower in the first quarter of 2020 compared to fourth quarter of 2019 due to the impact of high deductible insurance plans resetting.
The COVID-19 pandemic had an impact on all of the Company’s product revenue with the sales force being out of the field for about four weeks of the quarter. In particular, the full commercial launch of ANNOVERA was paused on March 1, 2020 as the Company deferred sales and marketing initiatives due to lack of access to healthcare providers and a shift of patients’ focus during the pandemic.
ANNOVERA net revenue of $2.3 million for the first quarter of 2020. Total prescriptions sold to patients doubled for the first quarter of 2020 over the fourth quarter of 2019. Patient demand was greater than the wholesale orders for the first quarter of 2020, reducing inventory with our distributors. Net revenue per unit, calculated from sales to wholesalers and pharmacies, for the first quarter 2020 was approximately $1,350.
 
 
For the long-term success of ANNOVERA, the Company is focusing on establishing the broad availability of ANNOVERA with retail pharmacies, mail order pharmacies, and online distributors, as well as public health and the military, which allows access where contraception is prescribed.
oMedicaid access is advancing with 37 states now covering ANNOVERA with average copays of $5 or less. ANNOVERA will be available for Title X entities in early 2020 and expects universities to adopt and prescribe ANNOVERA during the fall 2020 semester. ANNOVERA was added to formulary for the Department of Defense and is currently selling at 92 bases.
The United States Patent and Trademark Office (USPTO) recently issued a patent that covers the labeled indication for ANNOVERA that has been listed in the U.S. Food and Drug Administration’s (FDA) Approved Drug Products with Therapeutic Equivalence Evaluations (commonly known as the Orange Book). In addition to this patent, which provides patent exclusivity through 2039, ANNOVERA contains segesterone acetate, which qualifies ANNOVERA for FDA regulatory exclusivity through August 2023 under the Hatch-Waxman Act as a “new chemical entity.” Additional utility patent applications for ANNOVERA have been filed, including a design patent that, if issued, would strengthen the product’s exclusivity position.
IMVEXXY® first quarter 2020 net revenue was $6.4 million. In the first quarter of 2020, approximately 134,000 IMVEXXY prescriptions were dispensed to patients. Average calculated net revenue per unit on these dispensed products was approximately $48 for the first quarter of 2020. IMVEXXY is the fastest growing product in the vulvar and vaginal atrophy (VVA) market with 10.8% market share of total prescriptions in March 2020. Strong IMVEXXY refill rates continued with patients adhering to therapy. Patients on IMEXXY for one year average six fills.
IMVEXXY has market access for the majority of lives under commercial plans with 72% unrestricted commercial coverage, including all of the top ten commercial payors of VVA products. Three of the top eight Medicare Part D payors of VVA products cover IMVEXXY. While COVID-19 has slowed down the payor review process, the Company will continue to seek profitable preferred level access in Medicare Part D to keep patient copay experience consistent across commercial and Part D. IMVEXXY Medicaid access is advancing with 21 states now unrestricted in Medicaid with average copays of $5 or less.
BIJUVA® capsules first quarter 2020 net revenue was $1.1 million. In the first quarter of 2020, approximately 26,000 prescriptions were dispensed to patients. Average calculated net revenue per unit on these dispensed products was approximately $43 for the first quarter of 2020.
BIJUVA has market access for the majority of lives under commercial plans with 54% commercial coverage, including seven of the top ten commercial payors of vasomotor symptoms (VMS) products. BIJUVA Medicaid access is advancing with 21 states now unrestricted in Medicaid with average copays of $5 or less.
On behalf of the Board of Directors of TherapeuticsMD, Inc., Chairman Tommy G. Thompson recently strengthened the Board with the appointments of Paul Bisaro, Gail Naughton, Ph.D. and Karen Ling. These independent directors bring diversity, significant experience and a unique skillset to contribute to the Company’s next stage of growth. As part of the Board of Directors’ continued review of its composition and effectiveness, the Board has reduced its size from eleven directors to nine directors.

First Quarter 2020 Revenue Performance

For the quarter ended March 31, 2020, net product revenue was $12.3 million compared to $15.9 million for the prior quarter.

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