Q4 2025 Biofrontera Inc Earnings Call
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Speaker #2: I would now like to turn the conference over to Ben Shamseon with Litham Partners Investor Relations. Please go ahead. Thank you. Good morning, and welcome to Biofrontera's fourth quarter and full year 2025 financial results and business update conference call.
Ben Shamsian: Thank you. Good morning and welcome to Biofrontera's Q4 and full year 2025 financial results and business update conference call. Please note that certain information discussed during today's call by management is covered under the safe harbor provisions of the Private Securities Litigation Reform Act. We caution listeners that Biofrontera's management will be making forward-looking statements and that actual results may differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with the company's business. All risks and uncertainties are detailed in and are qualified by the cautionary statements contained in Biofrontera's press releases and SEC filings, including the company's annual report on Form 10-K for the year ended 31 December 2025. This conference call contains time-sensitive information that is accurate only as of the date of the live broadcast.
Ben Shamsian: Thank you. Good morning and welcome to Biofrontera's Q4 and full year 2025 financial results and business update conference call. Please note that certain information discussed during today's call by management is covered under the safe harbor provisions of the Private Securities Litigation Reform Act. We caution listeners that Biofrontera's management will be making forward-looking statements and that actual results may differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with the company's business. All risks and uncertainties are detailed in and are qualified by the cautionary statements contained in Biofrontera's press releases and SEC filings, including the company's annual report on Form 10-K for the year ended 31 December 2025. This conference call contains time-sensitive information that is accurate only as of the date of the live broadcast.
Speaker #2: Please note that certain information discussed during today's call by management is covered under the Safe Harbor provisions of the Private Securities Litigation Reform Act.
Speaker #2: We caution listeners that Biofrontera's management will be making forward-looking statements, and that actual results may differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with the company's business.
Speaker #2: All risks and uncertainties are detailed in and are qualified by the cautionary statements contained in Biofrontera's press releases and SAC filings, including the company's annual report on Form 10-K and the year for the year ended 12/31/2025.
Speaker #2: Also, this conference call contains time-sensitive information that is accurate only as of the date of the live broadcast. Biofronterra undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call, except as required by law.
Ben Shamsian: Biofrontera undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call, except as required by law. During today's call, there will be references to certain non-GAAP financial measures. Biofrontera believes these measures provide useful information for investors, yet should not be considered as a substitute for GAAP, nor should they be viewed as a substitute for operating results determined in accordance with GAAP. A reconciliation of non-GAAP to GAAP results is included in the press release issued today, and is also available on the company's website at biofrontera-us.com under the Investor Relations section.
Ben Shamsian: Biofrontera undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call, except as required by law. During today's call, there will be references to certain non-GAAP financial measures. Biofrontera believes these measures provide useful information for investors, yet should not be considered as a substitute for GAAP, nor should they be viewed as a substitute for operating results determined in accordance with GAAP. A reconciliation of non-GAAP to GAAP results is included in the press release issued today, and is also available on the company's website at biofrontera-us.com under the Investor Relations section.
Speaker #2: During today's call, there will be references to certain non-GAAP financial measures. Biofrontera believes these measures provide useful information for investors yet should not be considered as a substitute for GAAP, nor should they be viewed as a substitute for operating results determined in accordance with GAAP.
Speaker #2: A reconciliation of non-GAAP to GAAP results is included in the press release issued today and is also available on the company's website at biofrontera-us.com under the Investor Relations section.
Speaker #2: Please note, management will be referencing adjusted EBITDA, a non-GAAP financial measure defined as net income or loss excluding interest income and expenses, income taxes, depreciation, amortization, and certain other non-recurring or non-cash items, including changes in fair value of warrant liabilities, stock-based compensation, gain on sale of assets held for sale, and expense issuance costs.
Ben Shamsian: Please note management will be referencing adjusted EBITDA and non-GAAP financial measure defined as net income or loss, excluding interest income and expenses, income taxes, depreciation and amortization, and certain other non-recurring or non-cash items, including changes in fair value of warrant liabilities, stock-based compensation, gain on sale of assets held for sale, and issuance costs. With that said, I would now like to turn the call over to Hermann Luebbert, CEO, Chairman, and Founder of Biofrontera Inc. Hermann?
Ben Shamsian: Please note management will be referencing adjusted EBITDA and non-GAAP financial measure defined as net income or loss, excluding interest income and expenses, income taxes, depreciation and amortization, and certain other non-recurring or non-cash items, including changes in fair value of warrant liabilities, stock-based compensation, gain on sale of assets held for sale, and issuance costs. With that said, I would now like to turn the call over to Hermann Luebbert, CEO, Chairman, and Founder of Biofrontera Inc. Hermann?
Speaker #2: With that said, I would now like to turn the call over to Hermann Luebbert, CEO, Chairman, and Founder of Biofronterra. Herman?
Speaker #3: Yeah. Thank you, Ben. And thank you to everyone joining up joining us this morning. Fiscal year 2025 was a transformational year for Biofronterra. I'm proud to say that we delivered record annual revenues of $41.7 million representing about 12% growth over the prior year, capped by a record fourth quarter in which we generated revenues of $17.1 million, the highest quarterly revenue in our company's history.
Hermann Luebbert: Yeah, thank you, Ben, and thank you to everyone joining us this morning. Fiscal year 2025 was a transformational year for Biofrontera. I'm proud to say that we delivered record annual revenues of $41.7 million, representing about 12% growth over the prior year, capped by a record Q4, in which we generated revenues of $17.1 million, the highest quarterly revenue in our company's history, representing approximately 36% year-over-year growth. These results demonstrate the strength of our commercial execution and the growing adoption of Ameluz PDT across the dermatology community.
Hermann Luebbert: Yeah, thank you, Ben, and thank you to everyone joining us this morning. Fiscal year 2025 was a transformational year for Biofrontera. I'm proud to say that we delivered record annual revenues of $41.7 million, representing about 12% growth over the prior year, capped by a record Q4, in which we generated revenues of $17.1 million, the highest quarterly revenue in our company's history, representing approximately 36% year-over-year growth. These results demonstrate the strength of our commercial execution and the growing adoption of Ameluz PDT across the dermatology community.
Speaker #3: Representing approximately 36% year-over-year growth. These results demonstrate the strength of our commercial execution and the growing adoption of AMLU's PDT across the dermatology community.
Speaker #3: As a consequence, of the amendment in the contractual relationship with our former parent company, Biofrontera AG, which I'll explain in a few minutes, Q4 2025 was highly profitable for Biofrontera Inc. with an adjusted EBITDA of $4.9 million and an additional capital gain of $700K from the SEPI Invest divestment, resulting in a net income of $5.6 million.
Hermann Luebbert: As a consequence of the amendment in the contractual relationship with our former parent company, Biofrontera AG, which I'll explain in a few minutes, Q4 2025 was highly profitable for Biofrontera Inc., with an adjusted EBITDA of $4.9 million and an additional capital gain of $700,000 from the Xepi investee divestment, resulting in a net income of $5.6 million. Let me take a moment to summarize what we accomplished in 2025, which resulted in this profitable Q4 and sets the stage for an exciting 2026 and beyond. In October 2025, we closed a new asset purchase agreement with our former parent company, Biofrontera AG. The financial consequences were active already as of June 2025. This transaction is one of the most significant milestones in our history.
Hermann Luebbert: As a consequence of the amendment in the contractual relationship with our former parent company, Biofrontera AG, which I'll explain in a few minutes, Q4 2025 was highly profitable for Biofrontera Inc., with an adjusted EBITDA of $4.9 million and an additional capital gain of $700,000 from the Xepi investee divestment, resulting in a net income of $5.6 million. Let me take a moment to summarize what we accomplished in 2025, which resulted in this profitable Q4 and sets the stage for an exciting 2026 and beyond. In October 2025, we closed a new asset purchase agreement with our former parent company, Biofrontera AG. The financial consequences were active already as of June 2025. This transaction is one of the most significant milestones in our history.
Speaker #3: Let me take a moment to summarize what we accomplished in 2025, which resulted in this profitable fourth quarter and sets the stage for an exciting 2026 and beyond.
Speaker #3: In October 2025, we closed a new asset purchase agreement with our former parent company, Biofrontera AG. The financial consequences were active already as of June 2025.
Speaker #3: This transaction is one of the most significant milestones in our history. We acquired all US rights, approvals, and patents for AMLU's and Rodolat, including the new drug application, the investigational new drug application, all manufacturing rights and contracts, and all intellectual property.
Hermann Luebbert: We acquired all US rights, approvals, and patents for Ameluz and RhodoLED, including the New Drug Application, the Investigational New Drug application, all manufacturing rights and contracts, and all intellectual property. In December 2025, the FDA formally transferred the NDA and IND to us, giving Biofrontera Inc. full regulatory control in the United States. We also completed the transfer of 11 US patents, 10 US patent applications, and 19 international filings and registered designs. The financial implications of these transactions are significant. The new royalty or earn-out structure is 12% when annual US Ameluz net sales are at or below $65 million and 15% in years where they exceed that threshold. This replaces a transfer pricing model that previously ranged anywhere from 25% to 35% of revenue.
Hermann Luebbert: We acquired all US rights, approvals, and patents for Ameluz and RhodoLED, including the New Drug Application, the Investigational New Drug application, all manufacturing rights and contracts, and all intellectual property. In December 2025, the FDA formally transferred the NDA and IND to us, giving Biofrontera Inc. full regulatory control in the United States. We also completed the transfer of 11 US patents, 10 US patent applications, and 19 international filings and registered designs. The financial implications of these transactions are significant. The new royalty or earn-out structure is 12% when annual US Ameluz net sales are at or below $65 million and 15% in years where they exceed that threshold. This replaces a transfer pricing model that previously ranged anywhere from 25% to 35% of revenue.
Speaker #3: In December 2025, the FDA formally transferred the NDA and IND to us, giving Biofrontera Inc. full regulatory control in the United States. We also completed the transfer of 11 U.S. patents, 10 U.S. patent applications, and 19 international filings and registered designs.
Speaker #3: The financial implications of this transaction are significant. The new royalty or earnout structure is 12% when annual US AMLU's net sales are at or below $65 million, and 15% in years where they exceed that threshold.
Speaker #3: This replaces a transfer pricing model that previously ranged anywhere from $25% to $35% of revenue. This change has already begun to improve our gross margin profile, leading to the highly profitable Q4 and Fed will provide more detail on the impact in a few moments.
Hermann Luebbert: This change has already begun to improve our gross margin profile, leading to the highly profitable Q4, and Fred Leffler will provide more detail on the impact in a few moments. To support the AG transaction and our continued growth, we secured $11 million in funding through a private placement of Series C preferred stock led by Rosalind Advisors and AIGH Capital Management. These healthcare-focused institutional investors share our conviction in the long, long-term value of the Ameluz platform. We also completed the sale of our Xepi antibiotic cream license to Pelthos Therapeutics for initial proceeds of $3 million, with the potential for up to an additional $7 million in milestone payments. These transactions, combined with our strong Q4 revenue performance, gives us the resources and financial flexibility we need to execute on our plan.
Hermann Luebbert: This change has already begun to improve our gross margin profile, leading to the highly profitable Q4, and Fred Leffler will provide more detail on the impact in a few moments. To support the AG transaction and our continued growth, we secured $11 million in funding through a private placement of Series C preferred stock led by Rosalind Advisors and AIGH Capital Management. These healthcare-focused institutional investors share our conviction in the long, long-term value of the Ameluz platform. We also completed the sale of our Xepi antibiotic cream license to Pelthos Therapeutics for initial proceeds of $3 million, with the potential for up to an additional $7 million in milestone payments. These transactions, combined with our strong Q4 revenue performance, gives us the resources and financial flexibility we need to execute on our plan.
Speaker #3: To support the AG transaction and our continued growth, we secured $11 million in funding through a private placement of Series C preferred stock led by Roseland Advisors and Ake Capital Management.
Speaker #3: These healthcare-focused institutional investors share our conviction in the long-term value of the AMLU's platform. We also completed the sale of our SEPI antibiotic cream license to Peltos Therapeutics.
Speaker #3: For initial proceeds of $3 million, with the potential for up to an additional $7 million in milestone payments. These transactions combined with our strong fourth-quarter revenue performance gives us the resources and financial flexibility we need to execute on our plan.
Speaker #3: We made remarkable clinical progress across multiple fronts in 2025, and that momentum has carried into early 2026. First, in superficial basal cell carcinoma, or SBCC, we submitted a supplemental new drug application to the FDA in November 2025 based on strong phase three data from our 187-patient randomized double-blind placebo-controlled study.
Hermann Luebbert: We made remarkable clinical progress across multiple forms in 2025, and that momentum has carried into early 2026. First, in superficial basal cell carcinoma, or SBCC, we submitted a supplemental New Drug Application to the FDA in November 2025. Based on strong phase 3 data from our 187-patient randomized double-blind placebo-controlled study. Complete histological clearance was seen in 76% of these tumors with Ameluz PDT compared to 19% with placebo. Complete clinical clearance was achieved in 83% of the lesions compared to 21% with placebo. I am pleased to report that the FDA has accepted this filing, and we have a PDUFA target action date of 28 September 2026. If approved, Ameluz would be the first PDT drug approved to treat a tumor in the United States, representing an additional commercial opportunity. Second, in actinic keratosis on the extremities, neck, and trunk.
Hermann Luebbert: We made remarkable clinical progress across multiple forms in 2025, and that momentum has carried into early 2026. First, in superficial basal cell carcinoma, or SBCC, we submitted a supplemental New Drug Application to the FDA in November 2025. Based on strong phase 3 data from our 187-patient randomized double-blind placebo-controlled study. Complete histological clearance was seen in 76% of these tumors with Ameluz PDT compared to 19% with placebo. Complete clinical clearance was achieved in 83% of the lesions compared to 21% with placebo.
Speaker #3: Complete histological clearance was seen in 76% of these tumors with AMLU's PDT compared to 19% with placebo. Complete clinical clearance was achieved in 83% of the lesions compared to 21% with placebo.
Speaker #3: I am pleased to report that the FDA has accepted this filing and we have a PDUFA target action date of September 28, 2026. If approved, AMLU's would be the first PDT drug approved to treat a tumor in the United States representing an additional commercial opportunity.
Hermann Luebbert: I am pleased to report that the FDA has accepted this filing, and we have a PDUFA target action date of 28 September 2026. If approved, Ameluz would be the first PDT drug approved to treat a tumor in the United States, representing an additional commercial opportunity. Second, in actinic keratosis on the extremities, neck, and trunk.
Speaker #3: Second, in actinic keratosis on the extremities and neck and trunk. The last patient completed the treatment phase in the third quarter of 2025, and the database was locked in January 2026.
Hermann Luebbert: The last patient completed the treatment phase in Q3 2025, and the database was locked in January 2026. I'm very pleased to report that in February 2026, we announced positive phase 3 results. The study met its primary endpoint. Combined with the completed phase 1 pharmacokinetic study, we anticipate filing a supplemental NDA in Q3 2026 to expand the label for Ameluz to treat AK beyond the face and scalp on a treatment field of up to 240 square centimeters. With approximately 58 million American adults having at least one actinic keratosis lesion, treating extensive fields on the extremities, neck, and trunk represents a very large addressable market for our installed base of RhodoLED lamps. Third, in moderate to severe acne vulgaris. The treatment phase completed in Q3 2025, and the database was locked in January 2026.
Hermann Luebbert: The last patient completed the treatment phase in Q3 2025, and the database was locked in January 2026. I'm very pleased to report that in February 2026, we announced positive phase 3 results. The study met its primary endpoint. Combined with the completed phase 1 pharmacokinetic study, we anticipate filing a supplemental NDA in Q3 2026 to expand the label for Ameluz to treat AK beyond the face and scalp on a treatment field of up to 240 square centimeters. With approximately 58 million American adults having at least one actinic keratosis lesion, treating extensive fields on the extremities, neck, and trunk represents a very large addressable market for our installed base of RhodoLED lamps. Third, in moderate to severe acne vulgaris. The treatment phase completed in Q3 2025, and the database was locked in January 2026.
Speaker #3: I'm very pleased to report that in February 2026, we announced positive phase three results, the study met its primary endpoint. Combined with the completed phase one pharmacokinetic study, we anticipate filing a supplementing NDA supplemental NDA in Q3 of 2026 to expand the label for AMLU's to treat AK beyond the phase and scalp on a treatment field of up to 240 square centimeters.
Speaker #3: With approximately 58 million American adults having at least one actinic keratosis lesion, treating extensive fields on the extremities, neck, and trunk represents a very large addressable market for our installed base of Rodolat labs.
Speaker #3: Third, in moderate to severe acne vulgaris. The treatment phase completed in Q3 2025, and the database was locked in January 2026. Last week, we announced positive Phase 2 results.
Hermann Luebbert: Last week, we announced positive phase 2 results. The 3-hour incubation protocol demonstrated a 58% reduction in inflammatory lesions with Ameluz compared to 37% with vehicle gel. PDT patient satisfaction was very high, with 86% of patients stating they would choose PDT treatment again. Based on these data, we plan to discuss the design of a future phase 3 program with the FDA in Q3 2026. Acne vulgaris is a chronic condition affecting millions of adults and adolescents, and we believe Ameluz PDT has the potential to offer a differentiated treatment option for the moderate to severe form of the disease. Our patent portfolio was significantly strengthened in 2025. We received approval for the new improved formulation of Ameluz, which removed the potentially allergenic propylene glycol, extending patent protection through December 2043.
Hermann Luebbert: Last week, we announced positive phase 2 results. The 3-hour incubation protocol demonstrated a 58% reduction in inflammatory lesions with Ameluz compared to 37% with vehicle gel. PDT patient satisfaction was very high, with 86% of patients stating they would choose PDT treatment again. Based on these data, we plan to discuss the design of a future phase 3 program with the FDA in Q3 2026. Acne vulgaris is a chronic condition affecting millions of adults and adolescents, and we believe Ameluz PDT has the potential to offer a differentiated treatment option for the moderate to severe form of the disease. Our patent portfolio was significantly strengthened in 2025. We received approval for the new improved formulation of Ameluz, which removed the potentially allergenic propylene glycol, extending patent protection through December 2043.
Speaker #3: The three-hour incubation protocol demonstrated a 58% reduction in inflammatory lesions with AMLUs, compared to 37% with vehicle gel. PDT, our patient satisfaction, was very high, with 86% of patients stating they would choose PDT treatment again.
Speaker #3: Based on these data, we plan to discuss the design of a future phase three program with the FDA in the third quarter of 2026.
Speaker #3: Acne vulgaris is a chronic condition affecting millions of adults and adolescents and we believe AMLU's PDT has the potential to offer a differentiated treatment option for the moderate to severe form of the disease.
Speaker #3: Our patent portfolio was significantly strengthened in 2025. We received approval for the new improved formulation of AMLU's which removed the potentially allergenic propylene glycol, extending patent protection through December 2043.
Speaker #3: And just recently, we had positive news in our patent dispute with Sun Pharma. The US Patent Trial and Appeal Board issued a final written decision finding all claims of Sun Pharma's patent unpatentable that we had challenged.
Hermann Luebbert: Just recently, we had positive news in our patent dispute with Sun Pharma. The US Patent Trial and Appeal Board issued a final written decision finding all claims of Sun Pharma's patent unpatentable that we had challenged. This decision is a positive outcome in defending our market position, though we know, note Sun Pharma may seek further review. I would now like to turn the call over to George Jones, our Chief Commercial Officer, to provide a more detailed update on our commercial execution. George.
Hermann Luebbert: Just recently, we had positive news in our patent dispute with Sun Pharma. The US Patent Trial and Appeal Board issued a final written decision finding all claims of Sun Pharma's patent unpatentable that we had challenged. This decision is a positive outcome in defending our market position, though we know, note Sun Pharma may seek further review. I would now like to turn the call over to George Jones, our Chief Commercial Officer, to provide a more detailed update on our commercial execution. George.
Speaker #3: This decision is a positive outcome in defending our market position, though we know Sun Pharma may seek further review. I would now like to turn the call over to George Jones, our chief commercial officer, to provide a more detailed update on our commercial execution.
Speaker #3: George?
Speaker #2: Thank you, Herman, and good morning, everybody. I'm pleased to walk you through our commercial progress for 2025. As Herman noted, we delivered record revenues in the fourth quarter and achieved approximately 11% annual revenue growth.
George Jones: Thank you, Hermann, and good morning, everybody. I'm pleased to walk you through our commercial progress for 2025. As Hermann noted, we delivered record revenues in Q4 and achieved approximately 11% annual revenue growth. That revenue growth was driven by approximately $4.1 million in organic volume growth. What I want to emphasize today is the underlying quality of that growth and the executional improvements that powered it. First, looking at Ameluz unit volume growth. Ameluz unit volumes for full year 2025 increased meaningfully. Q4 unit volumes were particularly strong at approximately 49,840 tubes, bringing the full year unit volume to approximately 121,000 tubes. This represents approximately 10% volume growth over 2024.
George Jones: Thank you, Hermann, and good morning, everybody. I'm pleased to walk you through our commercial progress for 2025. As Hermann noted, we delivered record revenues in Q4 and achieved approximately 11% annual revenue growth. That revenue growth was driven by approximately $4.1 million in organic volume growth. What I want to emphasize today is the underlying quality of that growth and the executional improvements that powered it. First, looking at Ameluz unit volume growth. Ameluz unit volumes for full year 2025 increased meaningfully. Q4 unit volumes were particularly strong at approximately 49,840 tubes, bringing the full year unit volume to approximately 121,000 tubes. This represents approximately 10% volume growth over 2024.
Speaker #2: That revenue growth was driven by approximately $4.1 million in organic volume growth. What I want to emphasize today is the underlying quality of that growth and the executional improvements that powered it.
Speaker #2: First, looking at AMLU's unit volume growth. AMLU's unit volumes for full year 2025 increased meaningfully. Fourth quarter unit volumes were particularly strong at approximately 49,840 tubes, bringing the full year unit volume to approximately 121,000 tubes.
Speaker #2: This represents approximately 10% volume growth over 2024. These unit growth milestones underscored the effectiveness of the executional changes we implemented in 2025, which I'll discuss later in this section.
George Jones: These unit growth milestones underscore the effectiveness of the executional changes we implemented in 2025, which I'll discuss later in this section. Looking at RhodoLED lamp placements. During 2025, we placed approximately 85 BF-RhodoLED lamps within our dermatology practices, including approximately 70 of the newer XL model. As of 31 December 2025, our installed base stands at approximately 745 lamps across approximately 686 dermatology offices nationwide. Looking at our commercial execution, our revamped commercial strategy centered on the refined customer segmentation, more focused and data-driven targeting approach, and increased accountability delivered tangible results in 2025.
George Jones: These unit growth milestones underscore the effectiveness of the executional changes we implemented in 2025, which I'll discuss later in this section. Looking at RhodoLED lamp placements. During 2025, we placed approximately 85 BF-RhodoLED lamps within our dermatology practices, including approximately 70 of the newer XL model. As of 31 December 2025, our installed base stands at approximately 745 lamps across approximately 686 dermatology offices nationwide. Looking at our commercial execution, our revamped commercial strategy centered on the refined customer segmentation, more focused and data-driven targeting approach, and increased accountability delivered tangible results in 2025.
Speaker #2: Looking at Rhodo LED lamp placements during 2025, we placed approximately 85 BF Rhodo LED lamps within our dermatology practices. Including approximately 70 of the newer XL model.
Speaker #2: As of December 31, 2025, our installed base stands at approximately 745 lamps across approximately 686 dermatology offices nationwide. Looking at our commercial execution, our revamped commercial strategy centered on the refined customer segmentation more focused and data-driven targeting approach and increased accountability delivered tangible results in 2025.
Speaker #2: We saw a significant increase in sales call activity during the year and, importantly, increased in-person activity, which we know to drive the highest impact with our customers.
George Jones: We saw a significant increase in sales call activity during the year and, importantly, increased in-person activity, which we know to drive the highest impact with our customers. Looking a little deeper into the business, our 2025 churn rate, which is a measure of lost business from accounts that have purchased from us in the past year, was the lowest since 2021. On top of this, we were able to open over 150 new accounts and gain significant volume of Ameluz tubes through these new accounts. Additionally, we launched an inside sales pilot in Q4 to cover vacant territories, white space, as well as smaller accounts that were harder for our in-person sales team to reach. Based on the success of this pilot, we're planning for a full rollout of inside sales in 2026.
George Jones: We saw a significant increase in sales call activity during the year and, importantly, increased in-person activity, which we know to drive the highest impact with our customers. Looking a little deeper into the business, our 2025 churn rate, which is a measure of lost business from accounts that have purchased from us in the past year, was the lowest since 2021. On top of this, we were able to open over 150 new accounts and gain significant volume of Ameluz tubes through these new accounts. Additionally, we launched an inside sales pilot in Q4 to cover vacant territories, white space, as well as smaller accounts that were harder for our in-person sales team to reach. Based on the success of this pilot, we're planning for a full rollout of inside sales in 2026.
Speaker #2: Looking a little deeper into the business, our 2025 churn rate, which is a measure of lost business from accounts that have purchased from us in the past year, was the lowest since 2021.
Speaker #2: On top of this, we were able to open over 150 new accounts and gain significant volume of AMLU's tubes through these new accounts. Additionally, we launched an inside sales pilot in Q4 to cover vacant territories white space as well as smaller counts that were harder for our in-person sales team to reach.
Speaker #2: Based on the success of this pilot, we're planning for a full rollout of inside sales in 2026. Overall, I'm very encouraged by what I've seen in my first six months at Biofrontera.
George Jones: Overall, I'm very encouraged by what I've seen in my first six months at Biofrontera. I'm impressed by the talent, the drive of the team, and excited by the overall trajectory of the business. The growing installed lamp base, expanding customer adoption, continued commercial strategy refinement, and the potential for near-term label expansions in SBCC, AK of the trunk and extremities give us important multiple vectors for continued growth in 2026 and beyond. I look forward to updating you on our progress in current quarters. With that, I'll turn the call over to Fred Leffler, our Chief Financial Officer, to walk through the financial results. Fred.
George Jones: Overall, I'm very encouraged by what I've seen in my first six months at Biofrontera. I'm impressed by the talent, the drive of the team, and excited by the overall trajectory of the business. The growing installed lamp base, expanding customer adoption, continued commercial strategy refinement, and the potential for near-term label expansions in SBCC, AK of the trunk and extremities give us important multiple vectors for continued growth in 2026 and beyond. I look forward to updating you on our progress in current quarters. With that, I'll turn the call over to Fred Leffler, our Chief Financial Officer, to walk through the financial results. Fred.
Speaker #2: I'm impressed by the talent and drive of the team, and excited by the overall trajectory of the business. The growing installed lamp base, expanding customer adoption, continued commercial strategy refinement, and the potential for near-term label expansions in SBCC and AK of the trunk and extremities give us important multiple vectors for continued growth in 2026 and beyond.
Speaker #2: I look forward to updating you on our progress and current quarters. With that, I'll turn the call over to Fred Leffler, our Chief Financial Officer, to walk through the financial results.
Speaker #2: Fred?
Speaker #3: Thank you, George. And good morning, everyone. I'll offer our financial results for the fourth quarter and full year ended December 31, 2025. All comparisons are to the prior year period unless otherwise noted.
Fred Leffler: Thank you, George, and good morning, everyone. I'll walk through our financial results for the Q4 and full year ended December 31, 2025. All comparisons are to the prior year period, unless otherwise noted. A full reconciliation of our GAAP to non-GAAP measures is included in the press release we issued earlier today and is available on our website. Starting with Q4 2025 results. Revenues for the Q4 of 2025 were approximately $17.1 million, compared with $12.6 million in the Q4 of 2024. This is an increase of approximately 36%. This was the highest quarterly revenue in our company's history and was driven by the strong Ameluz sales execution and pricing adjustment that we introduced in December 2025.
Fred Leffler: Thank you, George, and good morning, everyone. I'll walk through our financial results for the Q4 and full year ended December 31, 2025. All comparisons are to the prior year period, unless otherwise noted. A full reconciliation of our GAAP to non-GAAP measures is included in the press release we issued earlier today and is available on our website. Starting with Q4 2025 results. Revenues for the Q4 of 2025 were approximately $17.1 million, compared with $12.6 million in the Q4 of 2024. This is an increase of approximately 36%. This was the highest quarterly revenue in our company's history and was driven by the strong Ameluz sales execution and pricing adjustment that we introduced in December 2025.
Speaker #3: A full reconciliation of our GAAP to non-GAAP measures is included in the press release we issued earlier today and is available on our website.
Speaker #3: Starting with fourth quarter 2025 results. Revenues for the fourth quarter of 2025 were approximately $17.1 million compared with $12.6 million in the fourth quarter of 2024.
Speaker #3: This increase of approximately 36 this is an increase of approximately 36%. This was the highest quarterly revenue in our company's history and was driven by the strong AMLU's sales execution and pricing adjustment that we introduced in December of 2025.
Speaker #3: Our related party cost of goods sold, or COGS, decreased 45% year over year. This was driven by the transition from the transfer pricing model under our prior license and supply agreement to the significantly lower earnout structure that came with the strategic transaction with Biofrontera AG that Hermann talked about a few moments ago.
Fred Leffler: Our related party cost of goods sold or COGS decreased 45% year-over-year. This was driven by the transition from the transfer pricing model under our prior license and supply agreement to the significantly lower earn-out structure that came with the strategic transaction with Biofrontera AG that Hermann talked about a few moments ago. Under the new arrangement, the cost of revenues per unit declined steadily to about 15%, compared with a range of 25% to 35% under the prior agreement. As a result, our gross profit on sales improved significantly, going from about 58% to 82% in Q4 2025, which is a great result and outcome of all the hard work that everyone at Biofrontera put into this transaction.
Fred Leffler: Our related party cost of goods sold or COGS decreased 45% year-over-year. This was driven by the transition from the transfer pricing model under our prior license and supply agreement to the significantly lower earn-out structure that came with the strategic transaction with Biofrontera AG that Hermann talked about a few moments ago. Under the new arrangement, the cost of revenues per unit declined steadily to about 15%, compared with a range of 25% to 35% under the prior agreement. As a result, our gross profit on sales improved significantly, going from about 58% to 82% in Q4 2025, which is a great result and outcome of all the hard work that everyone at Biofrontera put into this transaction.
Speaker #3: Under the new arrangement, the cost of revenues per unit declined steadily to about 15% compared with a range of $25 to $35% under the prior agreement.
Speaker #3: As a result, our gross profit on sales improved significantly going from about 58% to 82% in the fourth quarter of 2025, which is a greater result and outcome of all the hard work that everyone at Biofrontera put into this transaction.
Speaker #3: Total operating expenses for the fourth quarter of 2025 were $12.5 million compared with $14.3 million in the fourth quarter of 2024, with COGS excluded costs or about with COGS excluded costs were about $9.4 million in both years.
Fred Leffler: Total operating expenses for Q4 2025 were $12.5 million, compared with $14.3 million in Q4 2024. With COGS excluded, costs were about $9.4 million in both years. Selling general and administrative expenses, SG&A, increased $0.3 million or approximately 4% to $4.8 million in Q4 2025. This was mainly driven by legal costs. Research and development expenses were the same for the Q4s year-over-year at $0.8 million. This investment directly supported the clinical programs Hermann discussed a moment ago, including the work to complete the phase three AK extremities trial and the phase two acne trial.
Fred Leffler: Total operating expenses for Q4 2025 were $12.5 million, compared with $14.3 million in Q4 2024. With COGS excluded, costs were about $9.4 million in both years. Selling general and administrative expenses, SG&A, increased $0.3 million or approximately 4% to $4.8 million in Q4 2025. This was mainly driven by legal costs. Research and development expenses were the same for the Q4s year-over-year at $0.8 million. This investment directly supported the clinical programs Hermann discussed a moment ago, including the work to complete the phase three AK extremities trial and the phase two acne trial.
Speaker #3: Selling general and administrative expenses, SG&A, increased 0.3 million or approximately 4% to $4.8 million for in the fourth quarter of 2025. This was mainly driven by legal costs.
Speaker #3: Research and development expenses were the same for the fourth quarter year over year at $0.8 million. This investment directly supported the clinical programs Hermann discussed a moment ago, including the work to complete the phase three AK extremities trials and the phase two acne trial.
Speaker #3: Operating income for the fourth quarter of 2025 was $4.6 million. A $6.3 million improvement from a net loss of $1.7 million in the fourth quarter of 2024.
Fred Leffler: Operating income for Q4 2025 was $4.6 million, a $6.3 million improvement from a net loss of $1.7 million in Q4 2024. Net income for Q4 2025 was $5.6 million, a $7 million improvement from a net loss of $1.4 million in Q4 2024. This improvement was driven by the higher revenues, the materially lower cost of revenues resulting from the strategic transaction, which were partially offset by higher legal and R&D expenses. Turning to our non-GAAP measure, adjusted EBITDA for Q4 2025 was $4.9 million, compared with negative $1.4 million in Q4 2024. This is an improvement of $6.3 million.
Fred Leffler: Operating income for Q4 2025 was $4.6 million, a $6.3 million improvement from a net loss of $1.7 million in Q4 2024. Net income for Q4 2025 was $5.6 million, a $7 million improvement from a net loss of $1.4 million in Q4 2024. This improvement was driven by the higher revenues, the materially lower cost of revenues resulting from the strategic transaction, which were partially offset by higher legal and R&D expenses. Turning to our non-GAAP measure, adjusted EBITDA for Q4 2025 was $4.9 million, compared with negative $1.4 million in Q4 2024. This is an improvement of $6.3 million.
Speaker #3: Net income for the fourth quarter of 2025 was $5.6 million. A $7 million improvement from a net loss of $1.4 million in 2024. This improvement was driven by the higher revenues the materially lower cost of revenues resulting from the strategic transaction and which were partially offset by higher legal and R&D expenses.
Speaker #3: Turning to our non-GAAP measure, adjusted EBITDA for the fourth quarter of 2025 was $4.9 million compared with negative $1.4 million in 2024.
Speaker #3: This is an improvement of $6.3 million. Our adjusted EBITDA margin improved to a positive 29% from negative 11% in the prior year, reflecting the stronger sales as a favorable impact of higher gross profit and improved operating cost management.
Fred Leffler: Our adjusted EBITDA margin improved to +29% from -11% in the prior year, reflecting the stronger sales, the favorable impact of higher gross profit, and improved operating cost management. As a reminder, adjusted EBITDA excludes interest, taxes, depreciation, amortization, changes in the fair value of warrant liabilities, stock-based compensation, gain on sale of assets, and expenses, insurance, issuance costs. A full reconciliation can be found in our press release or on our website. Now turning to full year 2025 results. Total GAAP net revenues for the year 2025 were $41.7 million, compared with $37.3 million for the full year of 2024, an increase of approximately 12%.
Fred Leffler: Our adjusted EBITDA margin improved to +29% from -11% in the prior year, reflecting the stronger sales, the favorable impact of higher gross profit, and improved operating cost management. As a reminder, adjusted EBITDA excludes interest, taxes, depreciation, amortization, changes in the fair value of warrant liabilities, stock-based compensation, gain on sale of assets, and expenses, insurance, issuance costs. A full reconciliation can be found in our press release or on our website. Now turning to full year 2025 results. Total GAAP net revenues for the year 2025 were $41.7 million, compared with $37.3 million for the full year of 2024, an increase of approximately 12%.
Speaker #3: As a reminder, adjusted EBITDA excludes interest taxes depreciation, amortization, changes in the fair value of warrant liabilities, stock-based compensation, gain on sale of assets, and expense insurance issuance costs.
Speaker #3: A full reconciliation can be found in our press release or on our website. Now turning to full year 2025 results. Total gap net revenues for the year 2025 were $41.7 million compared with $37.3 million for the full year of 2024.
Speaker #3: An increase of approximately 12%. This increase was primarily driven by the by a $4.1 million in organic AMLU's growth. Associated with the volume. Our related party cost of goods sold decreased by 7.7 million or 43% to $10.1 million from $17.9 million in 2024.
Fred Leffler: This increase was primarily driven by $4.1 million in organic Ameluz growth associated with the volume. Our related party cost of goods sold decreased by $7.7 million or 43% to $10.1 million from $17.9 million in 2024. This is driven by the transition from our former transfer pricing model under the prior license and supply agreement to the significantly lower earn-out structure that came with the strategic transaction that took place in 2025. Under the new arrangement, beginning in July 2025, the cost of revenues per revenue unit declined steadily to about 15%, compared to a range of approximately 25% to 30% under the prior agreement.
Fred Leffler: This increase was primarily driven by $4.1 million in organic Ameluz growth associated with the volume. Our related party cost of goods sold decreased by $7.7 million or 43% to $10.1 million from $17.9 million in 2024. This is driven by the transition from our former transfer pricing model under the prior license and supply agreement to the significantly lower earn-out structure that came with the strategic transaction that took place in 2025. Under the new arrangement, beginning in July 2025, the cost of revenues per revenue unit declined steadily to about 15%, compared to a range of approximately 25% to 30% under the prior agreement.
Speaker #3: Again, this was driven by the transition from our former transfer pricing model under the prior license and supply agreement to the significantly lower earnout structure that came with the strategic transaction that took place in 2025.
Speaker #3: Under the new agreement arrangement, beginning in July 2025, the cost of revenues per revenue unit declined steadily to about 15% compared to a range of approximately or of 25 to 30 percent under the prior agreement.
Speaker #3: Additionally, $2.0 million purchase price accruals under the prior agreement were forgiven in connection with the closing. These reductions were offset by $2.2 million in earnout payments under the new agreements.
Fred Leffler: Additionally, $2.0 million of purchase price accruals under the prior agreement were forgiven in connection with the closing. These reductions were offset by $2.2 million in earn-out payments under the new agreements. As a result, our gross profit on product sales improved significantly, going from about 50% to 74% for the full year of 2025. We expect the full benefit of the new cost structure to be realized on an annualized basis in 2026, as the new 12% rate applied only to about 45% of the Ameluz's sales volume in 2025. In the long run, we expect our gross profit margin to range between 80% and 85%.
Fred Leffler: Additionally, $2.0 million of purchase price accruals under the prior agreement were forgiven in connection with the closing. These reductions were offset by $2.2 million in earn-out payments under the new agreements. As a result, our gross profit on product sales improved significantly, going from about 50% to 74% for the full year of 2025. We expect the full benefit of the new cost structure to be realized on an annualized basis in 2026, as the new 12% rate applied only to about 45% of the Ameluz's sales volume in 2025. In the long run, we expect our gross profit margin to range between 80% and 85%.
Speaker #3: As a result, our gross profit on product sales improved significantly, going from about 50% to 74% for the full year of 2025. We expect the full benefit of the new cost structure to be realized on an annualized basis in 2026 as the new 12% rate applied only to about 45% of the AMLU's sales volume in 2025.
Speaker #3: In the long run, we expect our gross profit margin to range between 80 and 85 percent. Total operating expenses for 2025 were $53.1 million, compared with $54.5 million in 2024.
Fred Leffler: Total operating expenses for 2025 were $53.1 million, compared with $54.5 million in 2024, a decrease of $1.5 million or about 3%. Within this, sales, general, and administrative expenses increased $4.0 million or approximately 12% to $38.4 million. The increase was driven by a $6 million increase in legal expenses related to patent claims, partially offset by a $1.1 million reduction in direct sales personnel expense from a lower headcount, $0.5 million in savings from lower sales support activity levels, a $300,000 decrease in intangible asset amortization, and a $200,000 decrease in bad debt expense.
Fred Leffler: Total operating expenses for 2025 were $53.1 million, compared with $54.5 million in 2024, a decrease of $1.5 million or about 3%. Within this, sales, general, and administrative expenses increased $4.0 million or approximately 12% to $38.4 million. The increase was driven by a $6 million increase in legal expenses related to patent claims, partially offset by a $1.1 million reduction in direct sales personnel expense from a lower headcount, $0.5 million in savings from lower sales support activity levels, a $300,000 decrease in intangible asset amortization, and a $200,000 decrease in bad debt expense.
Speaker #3: A decrease of 1.5 million or about 3%. Within this, sales general and administrative expenses increased $4.0 million or approximately 12% to $38.4 million. The increase was driven by a $6.0 million increase in legal expenses related to patent claims, partially offset by a $1.1 million reduction in direct sales personnel expense from a lower headcount, 0.5 million in savings from lower sales support activity levels, a $300,000 million decrease in intangible asset amortization, and a $200,000 decrease in bad debt expense.
Speaker #3: Research and development expense increased 1.6 million to $3.7 million in 2025, reflecting our responsibility for all U.S. clinical trials for the full year, which only started in June 2024.
Fred Leffler: Research and development expense increased $1.6 million to $3.7 million in 2025, reflecting our responsibility for all US clinical trials for the full year, which only started in June 2024. This investment directly supported the clinical program Hermann discussed, including wrapping up all of the clinical trials mentioned earlier. Our operating loss for the full year 2025 was $11.3 million, a significant improvement from a net loss of $17.2 million in 2024, a reduction of approximately 34%. Our net loss for the year 2025 was $10.5 million, a significant improvement from the net loss of $17.8 million in 2024, a reduction of approximately 41%.
Fred Leffler: Research and development expense increased $1.6 million to $3.7 million in 2025, reflecting our responsibility for all US clinical trials for the full year, which only started in June 2024. This investment directly supported the clinical program Hermann discussed, including wrapping up all of the clinical trials mentioned earlier. Our operating loss for the full year 2025 was $11.3 million, a significant improvement from a net loss of $17.2 million in 2024, a reduction of approximately 34%. Our net loss for the year 2025 was $10.5 million, a significant improvement from the net loss of $17.8 million in 2024, a reduction of approximately 41%.
Speaker #3: This investment directly supported the clinical programs Herman discussed including wrapping up all of the clinical trials mentioned earlier. Our operating loss for the full year 2025 was $11.3 million a significant improvement from a net loss of $17.2 million in 2024.
Speaker #3: A reduction of approximately 34%. Our net loss for the year 2025 was $10.5 million a significant improvement from the net loss of $17.8 million in 2024.
Speaker #3: A reduction of approximately 41%. This improvement was driven by higher revenues materially lower costs from the strategic transaction a decrease in interest expense partially offset by higher legal and R&D expenses.
Fred Leffler: This improvement was driven by higher revenues, materially lower costs from the strategic transaction, a decrease in interest expense, partially offset by higher legal and R&D expenses. Turning to our non-GAAP measure, adjusted EBITDA for the full year of 2025, it was negative $10.6 million compared to negative $15.3 million in 2024, an improvement of $4.7 million or 31%. Our adjusted EBITDA margin improved to negative 25.4% from negative 40.9% in the prior year, reflecting the favorable impact of higher gross profit and improved operational cost management. As a reminder, adjusted EBITDA excludes interest, tax, depreciation, amortization, changes in fair value of warrant liabilities, stock-based comp, gain on sale of assets, and equity issuance costs.
Fred Leffler: This improvement was driven by higher revenues, materially lower costs from the strategic transaction, a decrease in interest expense, partially offset by higher legal and R&D expenses. Turning to our non-GAAP measure, adjusted EBITDA for the full year of 2025, it was negative $10.6 million compared to negative $15.3 million in 2024, an improvement of $4.7 million or 31%. Our adjusted EBITDA margin improved to negative 25.4% from negative 40.9% in the prior year, reflecting the favorable impact of higher gross profit and improved operational cost management. As a reminder, adjusted EBITDA excludes interest, tax, depreciation, amortization, changes in fair value of warrant liabilities, stock-based comp, gain on sale of assets, and equity issuance costs.
Speaker #3: Turning to our non-GAAP measure, adjusted EBITDA for the full year of 2025 was negative $10.6 million, compared to negative $15.3 million in 2024.
Speaker #3: An improvement of $4.7 million, or 31%. Our adjusted EBITDA margin improved to negative 25.4% from negative 40.9% in the prior year, reflecting the favorable impact of higher gross profit and improved operational cost management.
Speaker #3: As a reminder, adjusted EBITDA excludes interest taxes depreciation, amortization, changes in fair value of warrant liabilities, stock-based comp, gain on sale of assets, and expense issuance costs.
Speaker #3: And I'll refer you to our press release or our website for more details. Finally, looking at our balance sheet and liquidity, as of December 31st, 2025, we had cash and cash equivalents of $6.4 million compared with $5.9 million at December 31st, 2024.
Fred Leffler: I'll refer you to our press release or our website for more details. Finally, looking at our balance sheet and liquidity, as of 31 December 2025, we had cash and cash equivalents of $6.4 million, compared with $5.9 million at 31 December 2024. During 2025, we received $11 million in gross proceeds from the private placement of Series C preferred stock, $3 million from the initial closing of the Xepi divestiture, and we generated $41.7 million in product revenue. Cash used in operating activities for the full year was $13.4 million, reflecting our net loss as well as changes in working capital. With the completion of the strategic transaction, we now have greater control over the supply chain, shorter lead times for our products, and improved inventory management.
Fred Leffler: I'll refer you to our press release or our website for more details. Finally, looking at our balance sheet and liquidity, as of 31 December 2025, we had cash and cash equivalents of $6.4 million, compared with $5.9 million at 31 December 2024. During 2025, we received $11 million in gross proceeds from the private placement of Series C preferred stock, $3 million from the initial closing of the Xepi divestiture, and we generated $41.7 million in product revenue. Cash used in operating activities for the full year was $13.4 million, reflecting our net loss as well as changes in working capital. With the completion of the strategic transaction, we now have greater control over the supply chain, shorter lead times for our products, and improved inventory management.
Speaker #3: During 2025, we received $11.0 million in gross proceeds from the private placement of Series C preferred stock, $3.0 million from the initial closing of the Zeppy divestiture, and we regenerated $41.7 million in product revenue.
Speaker #3: Cash used in operating activities for the full year was $13.4 million reflecting our net loss as well as changes in working capital. With the completion of the strategic transaction, we now have greater control over the supply chain, shorter lead times for our products, and improved inventory management.
Speaker #3: These operational improvements combined with the significantly lower cost structure under the new earnout agreement are expected to reduce our cash consumption as we advance towards our goal of cash flow breakeven.
Fred Leffler: These operational improvements, combined with the significantly lower cost structure under the new earn-out agreement, are expected to reduce our cash consumption as we advance towards our goal of cash flow breakeven. As we have discussed in our filings, the support of our institutional investors, Rosalind Advisors and AIGH Capital Management, have been instrumental in positioning us to execute the strategic transaction and invest in our clinical pipeline. We are grateful for their confidence and commitment. With that overview of our business and financial results, we are ready to take questions from our covering analysts. Operator?
Fred Leffler: These operational improvements, combined with the significantly lower cost structure under the new earn-out agreement, are expected to reduce our cash consumption as we advance towards our goal of cash flow breakeven. As we have discussed in our filings, the support of our institutional investors, Rosalind Advisors and AIGH Capital Management, have been instrumental in positioning us to execute the strategic transaction and invest in our clinical pipeline. We are grateful for their confidence and commitment. With that overview of our business and financial results, we are ready to take questions from our covering analysts. Operator?
Speaker #3: As we have discussed in our filings, the support of our institutional investors, Roslyn Inviters and AIGH Capital, has been instrumental in positioning us to execute the strategic exam transaction and invest in our clinical pipeline.
Speaker #3: We're grateful for their confidence and commitment. With that overview of our business and financial results, we are ready to take questions from our covering analysts.
Speaker #3: Operator.
Speaker #1: Thank you. We'll now begin the question and answer session. To ask a question, you may press star than one on your telephone keypad and to remove yourself from queue, please press star than two.
Operator 2: Thank you. We'll now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad, and to remove yourself from queue, please press star then two. At this time, we'll pause for just a moment to assemble our roster. Today's first question comes from Bruce Jackson at The Benchmark Company. Please go ahead.
Operator: Thank you. We'll now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad, and to remove yourself from queue, please press star then two. At this time, we'll pause for just a moment to assemble our roster. Today's first question comes from Bruce Jackson at The Benchmark Company. Please go ahead.
Speaker #1: At this time, we'll pause for just a moment to assemble our roster. And today's first question comes from Bruce Jackson at the Benchmark Company.
Speaker #1: Please go ahead.
Speaker #3: Hi, good morning and thanks for taking my questions. I want to talk about the gross margin improvement that you're anticipating for 2026. Fourth quarter was quite strong.
Bruce Jackson: Hi, good morning, and thanks for taking my questions. I wanna talk about the gross margin improvement that you're anticipating for 2026. Q4 was-
Bruce Jackson: Hi, good morning, and thanks for taking my questions. I wanna talk about the gross margin improvement that you're anticipating for 2026. Q4 was quite strong. How do you think it plays out over the course of the year? Is it gonna, like, kind of drop and then ramp again? Where do you see it exiting 2026?
Hermann Luebbert: Yep.
Bruce Jackson: was quite strong. How do you think it plays out over the course of the year? Is it gonna, like, kind of drop and then ramp again? Where do you see it exiting 2026?
Speaker #3: How do you think it plays out over the course of the year and is it going to is it going to kind of drop and then ramp again?
Speaker #3: And what do you see it exiting 2026?
Speaker #2: Yeah, can I still talk to you again, Bruce? So the gross profit margins we expect to be between 80 and 85 percent, and that the reason for the bit of the range is because of the mix between amylose and device sales.
Hermann Luebbert: Yeah. Nice to talk to you again, Bruce. So the gross profit margins we expect to be between 80 and 85%, and that the reason for the bit of the range is because of the mix between Ameluz and device sales. That has started on 1 January, and we expect to be within that range from 1 January and throughout 2026.
Fred Leffler: Yeah. Nice to talk to you again, Bruce. So the gross profit margins we expect to be between 80 and 85%, and that the reason for the bit of the range is because of the mix between Ameluz and device sales. That has started on 1 January, and we expect to be within that range from 1 January and throughout 2026.
Speaker #2: But that is started on Jan 1, and we expect to be within that range from Jan 1 and throughout
Speaker #3: And then would you say you're going to be how can I put this? Would you expect it to kind of start at that 82% level and stay there, or do you think it's going to be variable over the course of the year?
Bruce Jackson: Would you expect it to kind of like start at that 82% level and stay there, or do you think it's gonna be variable over the course of the year?
Bruce Jackson: Would you expect it to kind of like start at that 82% level and stay there, or do you think it's gonna be variable over the course of the year?
Speaker #2: I think it's going to start there and, like I said, it could fluctuate a little bit depending on the product mix in our revenue and cost of goods.
Hermann Luebbert: I think it's gonna start there, and like I said, it could fluctuate a little bit, depending on the product mix in our revenue and cost of goods sold.
Fred Leffler: I think it's gonna start there, and like I said, it could fluctuate a little bit, depending on the product mix in our revenue and cost of goods sold.
Speaker #3: Okay. Okay. That's all I've got right now. Thank you.
Bruce Jackson: Okay. That's all I've got right now. Thank you.
Bruce Jackson: Okay. That's all I've got right now. Thank you.
Speaker #2: Thanks, Bruce.
Hermann Luebbert: Thanks, Bruce.
Hermann Luebbert: Thanks, Bruce.
Speaker #1: Thank you. That concludes our question and answer session. I'd like to turn the conference back over to management for closing remarks.
Operator 2: Thank you. Well, that concludes our question and answer session. I'd like to turn the conference back over to management for closing remarks.
Operator: Thank you. Well, that concludes our question and answer session. I'd like to turn the conference back over to management for closing remarks.
Speaker #4: Yeah, thank you. So if I summarize what we have said, then first, we delivered record annual revenues and record first quarter revenues, demonstrating that our refined commercial strategy is working and that the amylose PDT platform continues to gain traction with dermatology center patients.
Hermann Luebbert: Yeah, thank you. If I summarize what we have said, then first, we delivered record annual revenues and record Q1 revenues, demonstrating that our refined commercial strategy is working as the Ameluz PDT platform continues to gain traction with dermatologists and their patients. Second, the completion of the strategic transaction with Biofrontera AG has fundamentally changed our business model. We now own and control all of our key US assets, intellectual property, regulatory approvals, manufacturing rights, and the new earn-out structure has materially improved our cost profile. The full annualized benefit of this new structure will flow through to our results in 2026. Third, our clinical pipeline is delivering results. We have a PDUFA date for superficial basal cell carcinoma in September 2026, positive phase 3 results for AK on the extremities, and encouraging phase 2 data in acne.
Hermann Luebbert: Yeah, thank you. If I summarize what we have said, then first, we delivered record annual revenues and record Q1 revenues, demonstrating that our refined commercial strategy is working as the Ameluz PDT platform continues to gain traction with dermatologists and their patients. Second, the completion of the strategic transaction with Biofrontera AG has fundamentally changed our business model. We now own and control all of our key US assets, intellectual property, regulatory approvals, manufacturing rights, and the new earn-out structure has materially improved our cost profile. The full annualized benefit of this new structure will flow through to our results in 2026. Third, our clinical pipeline is delivering results. We have a PDUFA date for superficial basal cell carcinoma in September 2026, positive phase 3 results for AK on the extremities, and encouraging phase 2 data in acne.
Speaker #4: Second, the completion of the strategic transaction with Biofrontera AG has fundamentally changed our business model. We now own and control all of our key US assets, intellectual property, regulatory approvals, manufacturing rights, and the new earnout structure has materially improved our cost profile.
Speaker #4: The full annualized benefit of this new structure will flow through to our results in 2026. And third, our clinical pipeline is delivering results. We have a PDUFA date for superficial basal cell carcinoma in September 2026, positive Phase 3 results for AK on the extremities, and encouraging Phase 2 data to be in acne.
Hermann Luebbert: Looking further ahead, we have planned studies in squamous cell carcinoma in situ and reduced pain PDT. Biofrontera is the only company in the United States running FDA-controlled clinical studies in PDT for dermatology, and our patent protection extends through to 2043. Finally, the combination of revenue growth, lower cost of revenues based on our new contract, and disciplined expense management led to a strong profit in Q4, the first quarter where the new cost of goods became fully effective, and we expect this to meaningfully improve our financial trajectory in 2026 as we continue to advance towards cash flow break-even. I want to thank you and our entire team for their dedication and hard work.
Hermann Luebbert: Looking further ahead, we have planned studies in squamous cell carcinoma in situ and reduced pain PDT. Biofrontera is the only company in the United States running FDA-controlled clinical studies in PDT for dermatology, and our patent protection extends through to 2043. Finally, the combination of revenue growth, lower cost of revenues based on our new contract, and disciplined expense management led to a strong profit in Q4, the first quarter where the new cost of goods became fully effective, and we expect this to meaningfully improve our financial trajectory in 2026 as we continue to advance towards cash flow break-even. I want to thank you and our entire team for their dedication and hard work.
Speaker #4: Looking further ahead, we have plans studies in squamous cell carcinoma in situ, and reduced pain PDT. Biofrontera is the only company in the United States running FDA-controlled clinical studies in PDT for dermatology and our patent protection extends through to 2043.
Speaker #4: And finally, the combination of revenue growth, lower cost of revenues based on our new contract, and disciplined expense management led to a strong profit in Q4.
Speaker #4: The first quarter where the new cost of goods became fully effective and we expect these to meaningfully improve our financial trajectory in 2026 as we continue to advance towards cash flow breakeven.
Speaker #4: I want to thank you, and our entire team, for their dedication and hard work. I also want to thank our shareholders, the healthcare professionals who use our products, and, most importantly, the patients whose lives we are helping to improve in their fight against skin disease.
Hermann Luebbert: I also want to thank our shareholders, the healthcare professionals who use our products, and most importantly, the patients whose lives we are helping to improve in the fight against skin disease. Thank you all for your continued support. Have a wonderful day.
Hermann Luebbert: I also want to thank our shareholders, the healthcare professionals who use our products, and most importantly, the patients whose lives we are helping to improve in the fight against skin disease. Thank you all for your continued support. Have a wonderful day.
Speaker #4: Thank you all for your continued support. Have a wonderful day.
Operator 2: Thank you. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines.
Operator: Thank you. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines.