HRTX — Heron Therapeutics, Inc.

Summary of Heron Therapeutics Q4 2025 Earnings Call

1. Key Financial Results and Metrics

• Total Net Revenues: Approximately $155 million for the full year 2025, exceeding guidance of $9 million to $13 million for adjusted EBITDA, which stood at $14.7 million.
• Gross Margin: Approximately 73%, indicating improved cost discipline and product mix.
• Q4 Performance: Net sales for Acute Care reached $16.3 million, a 33% increase from Q3 2025, driven by ZYNRELEF ($12.5 million) and APONVIE ($3.8 million). Year-over-year, ZYNRELEF grew 48%, and APONVIE grew 97%.

2. Strategic Updates and Business Highlights

• Successful Financing: Completion of financing removed a significant overhang, allowing management to focus on commercial execution and product expansion.
• Acute Care Initiatives: Launched the CrossLink IGNITE program to enhance distributor engagement, introduced a vial access needle (VAN), and implemented a new J-Code for ZYNRELEF to improve reimbursement clarity.
• Oncology Performance: CINVANTI generated over $105 million in revenue for 2025, despite a 7.8% decline primarily due to the planned wind down of SUSTOL.

3. Forward Guidance and Outlook

• 2026 Guidance: Projected net product sales of $173 million to $183 million and adjusted EBITDA of $10 million to $20 million, indicating continued profitability despite planned commercial investments.
• Strategic Focus: Plans to expand the commercial team in key markets to drive growth, with an emphasis on areas showing strong market access and favorable reimbursement dynamics.

4. Bad News, Challenges, or Points of Concern

• Oncology Decline: The decline in revenue from SUSTOL is a concern as it impacts overall oncology performance.
• Competitive Pressures: Increased competition in the oncology space is noted, although CINVANTI remains resilient.
• NOPAIN Act Awareness: Initial slow adoption and awareness of the NOPAIN Act among providers may hinder the expected benefits from this initiative.

5. Notable Q&A Insights

• CINVANTI Expectations: Anticipated unit volume growth for CINVANTI, but potential price erosion may keep sales relatively flat.
• NOPAIN Act Impact: Management believes the NOPAIN Act will be a strong tailwind moving forward, with increased education efforts underway to enhance provider awareness.
• VAN Rollout Success: The VAN rollout was smooth, and learnings from this will inform the prefilled syringe launch strategy.
• Litigation Update: Confidence expressed in the ongoing litigation regarding CINVANTI, with expectations for a decision before the 30-month stay.

Overall, Heron Therapeutics demonstrated strong financial performance in 2025, with significant growth in its Acute Care portfolio, while also addressing challenges in its oncology segment and navigating competitive pressures. The company is optimistic about its strategic initiatives and growth potential for 2026.