FBIOP — Fortress Biotech, Inc.

Earnings Call Summary for Journey Medical (FBIOP) - Q3 2025

1. Key Financial Results and Metrics:

• Total revenues for Q3 2025 were $17.6 million, a 21% increase from $14.9 million in Q3 2024.
• EMROSI, the new oral treatment for rosacea, contributed $4.9 million, marking a 75% increase from Q2.
• Gross margin decreased to 67.4% from 69.4% year-over-year, but improved sequentially from 63.5% in Q1 and 67.1% in Q2.
• SG&A expenses rose 6% to $12.1 million, reflecting costs related to EMROSI’s launch.
• GAAP net loss narrowed to $2.3 million ($0.09 per share) from a loss of $2.4 million ($0.12 per share) in the prior year.
• Adjusted EBITDA improved to $1.7 million from $300,000 in Q3 2024, with expectations to achieve sustainable EBITDA positivity in Q4 2025.

2. Strategic Updates and Business Highlights:

• EMROSI prescriptions grew significantly, with a total of 18,198 prescriptions in Q3, up 146% from Q2.
• The company successfully contracted with 2 of the 3 largest GPOs, providing access to over 100 million commercial lives.
• Positive physician feedback and strong initial refill rates indicate strong adoption and satisfaction with EMROSI.
• Journey Medical is actively participating in dermatology conferences to enhance awareness and visibility for EMROSI.

3. Forward Guidance and Outlook:

• Management expects continued revenue growth driven by EMROSI, forecasting peak annual net sales of over $200 million in the U.S. and $300 million globally.
• The company anticipates becoming sustainably EBITDA positive in Q4 2025.
• Focus will remain on disciplined expense management and margin expansion as EMROSI scales.

4. Bad News, Challenges, or Points of Concern:

• Revenue from legacy products, including Accutane, declined 16% year-over-year due to generic competition.
• The gross-to-net revenue ratio is expected to fluctuate as the company navigates early reimbursement dynamics and the impact of the co-pay assistance program.
• Delays in downstream health plan formulary adoption may affect the speed of EMROSI's market penetration.

5. Notable Q&A Insights:

• Management acknowledged the importance of the co-pay assistance program but expects reliance on it to decrease as more payers adopt coverage for EMROSI.
• There is a strategic focus on both breadth (number of prescribers) and depth (frequency of prescriptions) for EMROSI, with plans to convert new prescribers into consistent writers.
• The company is cautiously optimistic about Accutane's stability but remains vigilant regarding potential competitive pressures.
• Management noted that while initial physician feedback is positive, it will take time to see long-term prescribing patterns and patient retention rates.

Overall, Journey Medical reported strong growth driven by EMROSI, while facing challenges from legacy product competition and reimbursement dynamics. The outlook remains positive with expectations for continued revenue growth and improved profitability.