Q2 2022 Journey Medical Corp Earnings Call
Operator 1: Ladies and gentlemen, thank you for standing by. Good afternoon, and welcome to Journey Medical's Q2 2022 Financial Results and Corporate Update Conference Call. At this time, all participants are in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Participants of this call are advised that the audio of this conference call is being broadcast live over the Internet and is also being recorded for playback purposes. A webcast replay of the call will be available approximately 1 hour after the end of the call for approximately 30 days.
Operator: Ladies and gentlemen, thank you for standing by. Good afternoon, and welcome to Journey Medical's Q2 2022 Financial Results and Corporate Update Conference Call. At this time, all participants are in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Participants of this call are advised that the audio of this conference call is being broadcast live over the Internet and is also being recorded for playback purposes. A webcast replay of the call will be available approximately one hour after the end of the call for approximately 30 days.
Operator 1: I would like now to turn the call over to Jules Abraham of CORE IR, the company's investor relations firm. Please go ahead, sir.
Operator: I would like now to turn the call over to Jules Abraham of CORE IR, the company's investor relations firm. Please go ahead, sir.
Jules Abraham: Thank you, Carolyn. Good afternoon, everyone, and thank you for participating in today's conference call. Joining me from Journey Medical Corporation's leadership today are Claude Maraoui, Co-Founder, President, and Chief Executive Officer, Ernest DePaolantonio, Chief Financial Officer, Ramsey Alloush, General Counsel, and Dr. Srinivas Sidgiddi, Vice President of Clinical Development and Medical Affairs, who will also be joining us for the question and answer session. During this call, management will be making forward-looking statements, including statements that address Journey Medical's expectations for future performance or operational results. Forward-looking statements involve risks and other factors that may cause actual results to differ materially from those statements.
Jules Abraham: Thank you, Carolyn. Good afternoon, everyone, and thank you for participating in today's conference call. Joining me from Journey Medical Corporation's leadership today are Claude Maraoui, Co-Founder, President, and Chief Executive Officer, Ernest DePaolantonio, Chief Financial Officer, Ramsey Alloush, General Counsel, and Dr. Srinivas Sidgiddi, Vice President of Clinical Development and Medical Affairs, who will also be joining us for the question and answer session. During this call, management will be making forward-looking statements, including statements that address Journey Medical's expectations for future performance or operational results. Forward-looking statements involve risks and other factors that may cause actual results to differ materially from those statements.
Jules Abraham: For more information about these risks, please refer to the risk factors described in Journey Medical's most recently filed periodic reports on Form 10-K and Form 10-Q, the Form 8-K filed with the SEC today, and the company's press release that accompanies this call, particularly the cautionary statements within. Today's conference call includes non-GAAP financial measures that Journey Medical believes can be useful in evaluating its performance. You should not consider this additional information in isolation, nor as a substitute for results prepared in accordance with GAAP. For a reconciliation of this non-GAAP financial measure to net loss, its most directly comparable GAAP financial measure, please see the reconciliation table located in the company's earnings press release. The contents of this call contain time-sensitive information that is accurate only as of today, 9 August 2022.
Jules Abraham: For more information about these risks, please refer to the risk factors described in Journey Medical's most recently filed periodic reports on Form 10-K and Form 10-Q, the Form 8-K filed with the SEC today, and the company's press release that accompanies this call, particularly the cautionary statements within. Today's conference call includes non-GAAP financial measures that Journey Medical believes can be useful in evaluating its performance. You should not consider this additional information in isolation, nor as a substitute for results prepared in accordance with GAAP. For a reconciliation of this non-GAAP financial measure to net loss, its most directly comparable GAAP financial measure, please see the reconciliation table located in the company's earnings press release. The contents of this call contain time-sensitive information that is accurate only as of today, 9 August 2022.
Jules Abraham: Except as required by law, Journey Medical disclaims any obligation to publicly update or revise any information to reflect events or circumstances that occur after this call. It's now my pleasure to turn the call over to Claude Maraoui, Co-founder, President, and Chief Executive Officer. Claude.
Jules Abraham: Except as required by law, Journey Medical disclaims any obligation to publicly update or revise any information to reflect events or circumstances that occur after this call. It's now my pleasure to turn the call over to Claude Maraoui, Co-founder, President, and Chief Executive Officer. Claude.
Claude Maraoui: Thanks, Jules. Good afternoon, and thanks to everyone for joining our Q2 2022 conference call. Journey continued to show solid growth in the Q2 2022, despite the challenge of supply chain delays during the quarter that reduced the availability of product for sale. However, this was a temporary setback as these delays were resolved in July, and we feel confident that we will recover a significant portion of these lost revenues over the remainder of the year. Our flagship products, Qbrexza and Accutane, continue to gain momentum in the market and the additional contributions of our recently acquired products, AMZEEQ and Zilxi, coupled with the launch of one additional prescription product in the H2 of this year, positions us for yet another year of record revenue growth.
Claude Maraoui: Thanks, Jules. Good afternoon, and thanks to everyone for joining our Q2 2022 conference call. Journey continued to show solid growth in the Q2 2022, despite the challenge of supply chain delays during the quarter that reduced the availability of product for sale. However, this was a temporary setback as these delays were resolved in July, and we feel confident that we will recover a significant portion of these lost revenues over the remainder of the year. Our flagship products, Qbrexza and Accutane, continue to gain momentum in the market and the additional contributions of our recently acquired products, AMZEEQ and Zilxi, coupled with the launch of one additional prescription product in the H2 of this year, positions us for yet another year of record revenue growth.
Claude Maraoui: We achieved net sales of $18.3 million, an increase of 20% when compared to Q2 2021, which was driven primarily by the strong performance of Qbrexza and Accutane. We began selling these products in Q2 2021, which achieved combined net sales of $6.5 million versus this quarter's combined net sales of $11.3 million, which represents a growth rate of 74%. This growth was slightly offset by product shortages in the quarter for Ximino and Exelderm, as well as the continued generic competition for Targadox, which was $3 million less than the prior year's period. Looking forward, we will continue executing our strategy of supporting and growing our newly acquired and launched products, Qbrexza, Accutane, AMZEEQ, and Zilxi.
Claude Maraoui: We achieved net sales of $18.3 million, an increase of 20% when compared to Q2 2021, which was driven primarily by the strong performance of Qbrexza and Accutane. We began selling these products in Q2 2021, which achieved combined net sales of $6.5 million versus this quarter's combined net sales of $11.3 million, which represents a growth rate of 74%. This growth was slightly offset by product shortages in the quarter for Ximino and Exelderm, as well as the continued generic competition for Targadox, which was $3 million less than the prior year's period. Looking forward, we will continue executing our strategy of supporting and growing our newly acquired and launched products, Qbrexza, Accutane, AMZEEQ, and Zilxi.
Claude Maraoui: The second quarter was also impacted by an update to our managed care claim estimates, particularly for the recently acquired assets of AMZEEQ and Zilxi as the actual managed care claim experience emerged greater than expected. On the development front, we continue to be excited about the ongoing progress of our pivotal Phase 3 clinical program for DFD-29, which is being evaluated for the treatment of papulopustular rosacea in adults. Patient enrollment is tracking according to plan, and with the recent addition of 9 sites this quarter, we have already achieved and reached 45% of our targeted enrollment of 640 patients in the two trials. We anticipate announcing top line data from the trials in H1 2023, with the submission of our New Drug Application in H2 2023.
Claude Maraoui: The second quarter was also impacted by an update to our managed care claim estimates, particularly for the recently acquired assets of AMZEEQ and Zilxi as the actual managed care claim experience emerged greater than expected. On the development front, we continue to be excited about the ongoing progress of our pivotal Phase 3 clinical program for DFD-29, which is being evaluated for the treatment of papulopustular rosacea in adults. Patient enrollment is tracking according to plan, and with the recent addition of 9 sites this quarter, we have already achieved and reached 45% of our targeted enrollment of 640 patients in the two trials. We anticipate announcing top line data from the trials in H1 2023, with the submission of our New Drug Application in H2 2023.
Claude Maraoui: To reiterate, the market opportunity for DFD-29 is immense as an estimated 16 million patients in the US suffer from rosacea, which equated to an estimated $1 billion in prescription sales in 2021. The Phase 2 clinical data for DFD-29 demonstrated nearly double the efficacy over Oracea, the current market leader with $340 million prescription sales in 2021. We estimate that our peak net sales for this product will be in excess of $100 million. While we face some unforeseen challenges this quarter, we are confident that these issues have been resolved, and we look forward to another record year of growth in sales.
Claude Maraoui: To reiterate, the market opportunity for DFD-29 is immense as an estimated 16 million patients in the US suffer from rosacea, which equated to an estimated $1 billion in prescription sales in 2021. The Phase 2 clinical data for DFD-29 demonstrated nearly double the efficacy over Oracea, the current market leader with $340 million prescription sales in 2021. We estimate that our peak net sales for this product will be in excess of $100 million. While we face some unforeseen challenges this quarter, we are confident that these issues have been resolved, and we look forward to another record year of growth in sales.
Claude Maraoui: The foundation of our future growth continues to be the expansion of our product portfolio through in-licensing and acquiring of commercial and late-stage development assets that will allow us to continue to leverage our industry leading sales force. With that, I'll now turn the call over to Ernie, our Chief Financial Officer, who will review our financial results for Q2.
Claude Maraoui: The foundation of our future growth continues to be the expansion of our product portfolio through in-licensing and acquiring of commercial and late-stage development assets that will allow us to continue to leverage our industry leading sales force. With that, I'll now turn the call over to Ernie, our Chief Financial Officer, who will review our financial results for Q2.
Ernie De Paolantonio: Thanks, Claude, and hello, everyone. I will now review the Q2 financial results. Total net revenues increased $3 million or 20% to $18.3 million for the three-month period ended 30 June 2022, from $15.3 million for the three-month period ended 30 June 2021. Net revenue growth from period to period is primarily due to year-over-year revenue growth of Qbrexza, acquired and launched during the Q2 of 2021, and revenue growth in Accutane, launched late in the Q1 of 2021. In addition, the increase from period to period is driven by incremental net revenues as a result of our newly acquired and launched products, AMZEEQ and Zilxi, in January 2022.
Ernest DePaolantonio: Thanks, Claude, and hello, everyone. I will now review the Q2 financial results. Total net revenues increased $3 million or 20% to $18.3 million for the three-month period ended 30 June 2022, from $15.3 million for the three-month period ended 30 June 2021. Net revenue growth from period to period is primarily due to year-over-year revenue growth of Qbrexza, acquired and launched during the Q2 of 2021, and revenue growth in Accutane, launched late in the Q1 of 2021. In addition, the increase from period to period is driven by incremental net revenues as a result of our newly acquired and launched products, AMZEEQ and Zilxi, in January 2022.
Ernie De Paolantonio: Offsetting the increase is a decrease in revenue of $3 million from Targadox as a result of continued generic competition and Ximino and Exelderm supply delays from our contract manufacturers in Q2, as Claude previously described. These delays were resolved in July, and we currently have sufficient inventory to meet our current and future demand. Cost of goods sold increased by $0.1 million to $7.6 million for the three-month period ended 30 June 2022, from $7.5 million for the same period of the prior year. This increase is primarily due to higher product cost of goods sold of $0.8 million, driven by the higher volume of product sales and non-cash amortization of $0.3 million related to our acquired intangible assets due to the acquisition of AMZEEQ and Zilxi.
Ernest DePaolantonio: Offsetting the increase is a decrease in revenue of $3 million from Targadox as a result of continued generic competition and Ximino and Exelderm supply delays from our contract manufacturers in Q2, as Claude previously described. These delays were resolved in July, and we currently have sufficient inventory to meet our current and future demand. Cost of goods sold increased by $0.1 million to $7.6 million for the three-month period ended 30 June 2022, from $7.5 million for the same period of the prior year. This increase is primarily due to higher product cost of goods sold of $0.8 million, driven by the higher volume of product sales and non-cash amortization of $0.3 million related to our acquired intangible assets due to the acquisition of AMZEEQ and Zilxi.
Ernest DePaolantonio: This increase is offset by a net $1 million decrease in product cost of goods related to the inventory step up of units sold from the acquired finished goods of Qbrexza in 2021. Selling, general and administrative expenses increased by $7.4 million to $15.2 million for the three months ended June 30, 2022, from $7.8 million for the three months ended June 30, 2021. The increase is primarily attributable to the expansion of our sales force, marketing expenses related to our expanded product portfolio, patent litigation expenses, compliance, and other costs associated with being a public company. Research and development expenses increased to $2.6 million for the three months ended June 30, 2022, from $29,000 for the three months ended June 30, 2021.
Ernie De Paolantonio: This increase is offset by a net $1 million decrease in product cost of goods related to the inventory step up of units sold from the acquired finished goods of Qbrexza in 2021. Selling, general and administrative expenses increased by $7.4 million to $15.2 million for the three months ended June 30, 2022, from $7.8 million for the three months ended June 30, 2021. The increase is primarily attributable to the expansion of our sales force, marketing expenses related to our expanded product portfolio, patent litigation expenses, compliance, and other costs associated with being a public company. Research and development expenses increased to $2.6 million for the three months ended June 30, 2022, from $29,000 for the three months ended June 30, 2021.
Ernest DePaolantonio: The increase is attributable to clinical trial expenses of our DFD-29 candidate, for which dosing began in March 2022. These expenses will increase as more patients are fully enrolled in the trials in the coming months. Research and development licensing acquired decreased $13.7 million, or 100%, for the three-month period ended 30 June 2022, from the prior period of the same quarter in 2021. The prior period expense reflects the acquisition of DFD-29 from Dr. Reddy's for $10 million and a fair value of the contingent payment due to Dr. Reddy's of $3.7 million.
Ernie De Paolantonio: The increase is attributable to clinical trial expenses of our DFD-29 candidate, for which dosing began in March 2022. These expenses will increase as more patients are fully enrolled in the trials in the coming months. Research and development licensing acquired decreased $13.7 million, or 100%, for the three-month period ended 30 June 2022, from the prior period of the same quarter in 2021. The prior period expense reflects the acquisition of DFD-29 from Dr. Reddy's for $10 million and a fair value of the contingent payment due to Dr. Reddy's of $3.7 million.
Ernie De Paolantonio: Net loss attributable to common shareholders was $7.5 million or $0.43 per share, basic and diluted, for Q2 2022, compared to a net loss attributable to common shareholders of $11.9 million or $1.30 per share, basic and diluted, for Q2 2021. Our non-GAAP adjusted EBITDA for the quarter, after adjusting for R&D expenses related to DFD-29, was a loss of $2.6 million, and on a year-to-date basis is -$263,000. This does not take into account the impact that certain product delays had on our sales in the quarter. We believe that this non-GAAP adjusted EBITDA figure will turn positive in the upcoming quarters, as it has been since 2017.
Ernest DePaolantonio: Net loss attributable to common shareholders was $7.5 million or $0.43 per share, basic and diluted, for Q2 2022, compared to a net loss attributable to common shareholders of $11.9 million or $1.30 per share, basic and diluted, for Q2 2021. Our non-GAAP adjusted EBITDA for the quarter, after adjusting for R&D expenses related to DFD-29, was a loss of $2.6 million, and on a year-to-date basis is -$263,000. This does not take into account the impact that certain product delays had on our sales in the quarter. We believe that this non-GAAP adjusted EBITDA figure will turn positive in the upcoming quarters, as it has been since 2017.
Ernie De Paolantonio: At 30 June 2022, we had $38.1 million in cash and cash equivalents as compared to $49.1 million at 31 December 2021. As mentioned in our press release, we received encouraging news regarding our cybersecurity breach, which resulted in losses to us of $9.5 million from the FBI and the Department of Homeland Security that a significant amount of cryptocurrency associated with the breach has been seized and that will be soon in the liquidation process over the upcoming months for their eventual return to Journey Medical. We are not able, at this time, to estimate the exact amount or the timetable for receiving the funds. Finally, in August, we borrowed the additional $5 million available from the second tranche of the term loan with East West Bank.
Ernest DePaolantonio: At 30 June 2022, we had $38.1 million in cash and cash equivalents as compared to $49.1 million at 31 December 2021. As mentioned in our press release, we received encouraging news regarding our cybersecurity breach, which resulted in losses to us of $9.5 million from the FBI and the Department of Homeland Security that a significant amount of cryptocurrency associated with the breach has been seized and that will be soon in the liquidation process over the upcoming months for their eventual return to Journey Medical. We are not able, at this time, to estimate the exact amount or the timetable for receiving the funds. Finally, in August, we borrowed the additional $5 million available from the second tranche of the term loan with East West Bank.
Ernest DePaolantonio: The additional $5 million is part of our operating plan of supporting DFD-29 clinical program and working capital. With that, I will turn the call back over to Claude. Thank you.
Ernie De Paolantonio: The additional $5 million is part of our operating plan of supporting DFD-29 clinical program and working capital. With that, I will turn the call back over to Claude. Thank you.
Claude Maraoui: Thank you, Ernie. We are looking forward to achieving additional milestone events in H2 2022, including the completion of enrollment for both Phase 3 clinical trials for DFD-29 and the launch of another prescription dermatology product to add to our portfolio. With a strong foundation and the continued momentum in our new products, we expect to achieve another year of record revenues in 2022. I will now turn the call over to the operator for questions. Thank you.
Claude Maraoui: Thank you, Ernie. We are looking forward to achieving additional milestone events in H2 2022, including the completion of enrollment for both Phase 3 clinical trials for DFD-29 and the launch of another prescription dermatology product to add to our portfolio. With a strong foundation and the continued momentum in our new products, we expect to achieve another year of record revenues in 2022. I will now turn the call over to the operator for questions. Thank you.
Operator 1: Ladies and gentlemen, if you wish to ask a question on today's call, you will need to press star, then the number one on your telephone. If your question has been answered and you wish to withdraw your request, you may do so by pressing the pound key. If you're using a speakerphone, please pick up your handset before entering your request and speaking on the call. One moment please for the first question. The first question comes with Brandon Folkes with Cantor Fitzgerald. Please go ahead.
Operator: Ladies and gentlemen, if you wish to ask a question on today's call, you will need to press star, then the number one on your telephone. If your question has been answered and you wish to withdraw your request, you may do so by pressing the pound key. If you're using a speakerphone, please pick up your handset before entering your request and speaking on the call. One moment please for the first question. The first question comes with Brandon Folkes with Cantor Fitzgerald. Please go ahead.
Brandon Folkes: Hi. Thanks for taking my questions, and congratulations on another good quarter. Maybe just for me, starting off on DFD-29, what do we need to see in the data in order to differentiate the product maybe from others? And then how does the enrollment at this stage compare to your initial expectations?
Brandon Folkes: Hi. Thanks for taking my questions, and congratulations on another good quarter. Maybe just for me, starting off on DFD-29, what do we need to see in the data in order to differentiate the product maybe from others? And then how does the enrollment at this stage compare to your initial expectations?
Claude Maraoui: Sure. Thank you, Brandon, and good to hear you. I'll just start, and I'm gonna hand it over to our Vice President of Clinical Development, Dr. Srinivas Sidgiddi. Overall, in summary, we are on track regarding the clinical trials for DFD-29, and enrollment is going on track with our plan. I'm gonna have Dr. Sidgiddi take it from here and give you some more details. Srini.
Claude Maraoui: Sure. Thank you, Brandon, and good to hear you. I'll just start, and I'm gonna hand it over to our Vice President of Clinical Development, Dr. Srinivas Sidgiddi. Overall, in summary, we are on track regarding the clinical trials for DFD-29, and enrollment is going on track with our plan. I'm gonna have Dr. Sidgiddi take it from here and give you some more details. Srini.
Srinivas Sidgiddi: Thank you so much, Claude. And thanks for the question. The enrollment for the two studies, the Phase 3 studies, MVOR-1 and MVOR-2. So that's the acronym that we have given to the Phase 3 studies. MVOR essentially stands for minocycline versus Oracea in rosacea. The enrollment for the two studies is going on as planned. There is a slight delay on the European leg of the second study, and that is because of things that are out of our control, regulatory approvals, et cetera, have been delayed. But otherwise, the overall enrollment is still within what we had anticipated and within the buffers that we have had. So that's the first question. The second part of the question was about differentiation in rosacea.
Srinivas Sidgiddi: Thank you so much, Claude. And thanks for the question. The enrollment for the two studies, the Phase 3 studies, MVOR-1 and MVOR-2. So that's the acronym that we have given to the Phase 3 studies. MVOR essentially stands for minocycline versus Oracea in rosacea. The enrollment for the two studies is going on as planned. There is a slight delay on the European leg of the second study, and that is because of things that are out of our control, regulatory approvals, et cetera, have been delayed. But otherwise, the overall enrollment is still within what we had anticipated and within the buffers that we have had. So that's the first question. The second part of the question was about differentiation in rosacea.
Srinivas Sidgiddi: We anticipate to see a significant improvement on the inflammatory lesions and the Investigator Global Assessment, which are the two co-primary endpoints for this study. We essentially would like to see a significant difference on the inflammatory lesion counts as well as the erythema component of rosacea. Those are the two things that would differentiate us from the other products.
Srinivas Sidgiddi: We anticipate to see a significant improvement on the inflammatory lesions and the Investigator Global Assessment, which are the two co-primary endpoints for this study. We essentially would like to see a significant difference on the inflammatory lesion counts as well as the erythema component of rosacea. Those are the two things that would differentiate us from the other products.
Brandon Folkes: Great. Thank you very much.
Brandon Folkes: Great. Thank you very much.
Srinivas Sidgiddi: Thank you.
Srinivas Sidgiddi: Thank you.
Operator: The next question comes with Mayank Mamtani with B. Riley Securities. Please go ahead.
Operator 2: The next question comes with Mayank Mamtani with B. Riley Securities. Please go ahead.
Mayank Mamtani: Good afternoon. This is Mayank on for Kalpit Patel. Thanks for taking our questions. Just maybe first on the Qbrexza sales. Could you comment on, you know, what specific campaigns are you seeing resonate well with your customers? Also if you could give us a sense of repeat versus new prescriptions, again, I understand it's still early days, but if you could comment on how you're seeing that trend. I have a couple of follow-ups.
Mayank Mamtani: Good afternoon. This is Mayank on for Kalpit Patel. Thanks for taking our questions. Just maybe first on the Qbrexza sales. Could you comment on, you know, what specific campaigns are you seeing resonate well with your customers? Also if you could give us a sense of repeat versus new prescriptions, again, I understand it's still early days, but if you could comment on how you're seeing that trend. I have a couple of follow-ups.
Claude Maraoui: Sure. Thank you, Mayank. This is Claude. Regarding Qbrexza, we have really focused in on a digital campaign with the brand, and it really encompasses a few areas. One is really building awareness with the demographic and the age group that we're targeting. I think it's off to a really good start. We're focused in, for example, with Facebook and Instagram and other social media platforms to really get that message. Again, awareness, education and really just driving inquiries about this to the dermatology providers when these patients go and see their dermatologist. So we like that's how it's been progressing. Our impressions, our hits have all been increasing nicely, and I think that's really corresponded well in terms of prescription demand.
Claude Maraoui: Sure. Thank you, Mayank. This is Claude. Regarding Qbrexza, we have really focused in on a digital campaign with the brand, and it really encompasses a few areas. One is really building awareness with the demographic and the age group that we're targeting. I think it's off to a really good start. We're focused in, for example, with Facebook and Instagram and other social media platforms to really get that message. Again, awareness, education and really just driving inquiries about this to the dermatology providers when these patients go and see their dermatologist. So we like that's how it's been progressing. Our impressions, our hits have all been increasing nicely, and I think that's really corresponded well in terms of prescription demand.
Claude Maraoui: For example, from Q1 to Q2, Mayank, we have had approximately 25% increase in prescription growth. I think the campaign is working well, and we're making some progress on that front. Could you repeat your second part of your question, please?
Claude Maraoui: For example, from Q1 to Q2, Mayank, we have had approximately 25% increase in prescription growth. I think the campaign is working well, and we're making some progress on that front. Could you repeat your second part of your question, please?
Mayank Mamtani: Repeat versus new prescriptions.
Mayank Mamtani: Repeat versus new prescriptions.
Claude Maraoui: Sure, sure. I can just as far as looking into the new prescriptions with Symphony data, and as of the most recent month, new prescriptions have been trending upward. In January, for example, we were at 3,600 prescriptions for the month in new prescriptions. In June, which is the most recent data, we're all the way up to approximately 5,400 prescriptions. When you take a look at that comparator and look at the ratio of total prescriptions, we've more than doubled that. For example, again, NRxs in June at 5,400 and TRxs in June total prescriptions at approximately 12,000 prescriptions. I think that's a good indicator and sign that we are getting and increasing our refill rates as well.
Claude Maraoui: Sure, sure. I can just as far as looking into the new prescriptions with Symphony data, and as of the most recent month, new prescriptions have been trending upward. In January, for example, we were at 3,600 prescriptions for the month in new prescriptions. In June, which is the most recent data, we're all the way up to approximately 5,400 prescriptions. When you take a look at that comparator and look at the ratio of total prescriptions, we've more than doubled that. For example, again, NRxs in June at 5,400 and TRxs in June total prescriptions at approximately 12,000 prescriptions. I think that's a good indicator and sign that we are getting and increasing our refill rates as well.
Mayank Mamtani: Great. A second follow-up to, you know, the earlier question that Srini addressed. If you could comment on, you know, your assumptions on the placebo and the active comparator in the two studies that you're doing, the MVOR-1 and MVOR-2, and sort of, Srini, could you just comment on the expectations for an effect size on the, you know, IGA and the inflammatory lesion count reduction endpoint?
Mayank Mamtani: Great. A second follow-up to, you know, the earlier question that Srini addressed. If you could comment on, you know, your assumptions on the placebo and the active comparator in the two studies that you're doing, the MVOR-1 and MVOR-2, and sort of, Srini, could you just comment on the expectations for an effect size on the, you know, IGA and the inflammatory lesion count reduction endpoint?
Srinivas Sidgiddi: Sure, Mayank. Thank you so much for the question. It is a really good question. We have looked at the efficacy that we saw in the phase 2 study that was conducted in Europe, in which we had DFD-29 as one of the arms, and we had Oracea, that is the European Oracea, as well as placebo. We have used those estimates in the calculation of the sample sizes for this phase 3 program. To give you a brief about what kind of efficacy we had seen there, we had seen IGA treatment success of 66% for DFD-29 40mg versus 33% for Oracea and 11% for placebo. Those were the estimates that we used for calculation of sample sizes.
Srinivas Sidgiddi: Sure, Mayank. Thank you so much for the question. It is a really good question. We have looked at the efficacy that we saw in the phase 2 study that was conducted in Europe, in which we had DFD-29 as one of the arms, and we had Oracea, that is the European Oracea, as well as placebo. We have used those estimates in the calculation of the sample sizes for this phase 3 program. To give you a brief about what kind of efficacy we had seen there, we had seen IGA treatment success of 66% for DFD-29 40mg versus 33% for Oracea and 11% for placebo. Those were the estimates that we used for calculation of sample sizes.
Mayank Mamtani: Very helpful. My final question, a little high level, maybe for Claude and Ernie. At what stage, you know, you feel comfortable, you know, talking about a little longer term projection and maybe talk about giving guidance? I understand you have some one-off, you know, supply chain dynamics and with certain products, you know, competitive dynamics. Just curious, you know, at what point you feel, you know, you'd have a good command of thinking, you know, ahead like 2, 3 quarters and maybe even thinking about the next year from a financial guidance standpoint.
Mayank Mamtani: Very helpful. My final question, a little high level, maybe for Claude and Ernie. At what stage, you know, you feel comfortable, you know, talking about a little longer term projection and maybe talk about giving guidance? I understand you have some one-off, you know, supply chain dynamics and with certain products, you know, competitive dynamics. Just curious, you know, at what point you feel, you know, you'd have a good command of thinking, you know, ahead like 2, 3 quarters and maybe even thinking about the next year from a financial guidance standpoint.
Claude Maraoui: Sure. You know, first of all, I think, we are getting closer to giving guidance in terms of getting the new assets on board that we acquired in January, with Vyne Therapeutics. I think in the next two quarters, definitely, towards the beginning of next year, we'll be able to give guidance moving forward there, with a very comfortable range. Ernie, I'd like you to add anything onto that, if you'd like.
Claude Maraoui: Sure. You know, first of all, I think, we are getting closer to giving guidance in terms of getting the new assets on board that we acquired in January, with Vyne Therapeutics. I think in the next two quarters, definitely, towards the beginning of next year, we'll be able to give guidance moving forward there, with a very comfortable range. Ernie, I'd like you to add anything onto that, if you'd like.
Ernest DePaolantonio: Yeah. We're still getting our portfolio of products from Vyne normalized, where we can make such estimates for our earnings. As Claude said, I think in the upcoming quarters you'll see us start to provide guidance.
Ernie De Paolantonio: Yeah. We're still getting our portfolio of products from Vyne normalized, where we can make such estimates for our earnings. As Claude said, I think in the upcoming quarters you'll see us start to provide guidance.
Mayank Mamtani: Thanks for taking our questions too.
Mayank Mamtani: Thanks for taking our questions too.
Claude Maraoui: Yeah, Srini, if you don't mind, just to follow up on the DFD-29. Can you go over how many sites we have enrolled now for the study?
Claude Maraoui: Yeah, Srini, if you don't mind, just to follow up on the DFD-29. Can you go over how many sites we have enrolled now for the study?
Srinivas Sidgiddi: Yes, Claude. We initially planned to have 29 sites in both the studies, MVOR-1 and MVOR-2, which meant that we would have 58 sites for the US and Europe combined. We plan to get 640 subjects from these 58 sites. Currently, we stand at 30 sites that are enrolled into the MVOR-01 study. Those are entirely in the United States. On MVOR-2, we have 15 sites in the US that have been enrolling patients, and we have 14 sites that are coming up in Europe. Of the 14, we have 9 sites in Germany that are initiated or in the process of being initiated.
Srinivas Sidgiddi: Yes, Claude. We initially planned to have 29 sites in both the studies, MVOR-1 and MVOR-2, which meant that we would have 58 sites for the US and Europe combined. We plan to get 640 subjects from these 58 sites. Currently, we stand at 30 sites that are enrolled into the MVOR-01 study. Those are entirely in the United States. On MVOR-2, we have 15 sites in the US that have been enrolling patients, and we have 14 sites that are coming up in Europe. Of the 14, we have 9 sites in Germany that are initiated or in the process of being initiated.
Srinivas Sidgiddi: We are awaiting approval from the Polish competent authority, after which we will be starting the 4 sites in Poland as well. As of now, we have 29 sites on DFD-29, 29 MVOR-01 study and the 15 sites in the US for the MVOR-02 study, plus additional 5 sites that have been initiated in Germany as of today.
Srinivas Sidgiddi: We are awaiting approval from the Polish competent authority, after which we will be starting the 4 sites in Poland as well. As of now, we have 29 sites on DFD-29, 29 MVOR-01 study and the 15 sites in the US for the MVOR-02 study, plus additional 5 sites that have been initiated in Germany as of today.
Claude Maraoui: Thank you.
Claude Maraoui: Thank you.
Operator: Thank you very much, gentlemen. That concludes our question and answer session. I would like now to turn the call back over to Mr. Claude Maraoui. Please go ahead, sir.
Operator 3: Thank you very much, gentlemen. That concludes our question and answer session. I would like now to turn the call back over to Mr. Claude Maraoui. Please go ahead, sir.
Claude Maraoui: Thank you very much. I wanna thank all of you for participating on today's call and your interest in Journey Medical. We look forward to sharing our ongoing process when we report our Q3 results in November. Thank you and have a good day.
Claude Maraoui: Thank you very much. I wanna thank all of you for participating on today's call and your interest in Journey Medical. We look forward to sharing our ongoing process when we report our Q3 results in November. Thank you and have a good day.
Operator 3: This conference has now concluded. Thank you for attending today's presentation. You may now disconnect. Have a good day.
Operator: This conference has now concluded. Thank you for attending today's presentation. You may now disconnect. Have a good day.