Scott Henry

Scott Henry asked about the lower number of pipeline ads (676) in the quarter, questioning if it was an aberration, indicative of higher quality ads, or expected to bounce back. He also inquired about the pipeline dropout rate, which he calculated to be around 40% and higher than previous quarters. Lastly, he sought clarification on the strong gross margins (68%-69%) in the quarter, asking if this could be a new baseline and how high they could potentially go.

Answer

David Henry, CFO, attributed the lower pipeline ads in Q4 to a company shutdown for approximately nine days and fewer weeks in the quarter, emphasizing the expectation for MyoConnect to generate more ads at a reduced cost. Regarding the pipeline drop rate, Mr. Henry confirmed it was higher, largely due to Medicare Advantage patients accumulating in the pipeline and facing authorization denials. Paul Gudonis, Chairman and CEO, added that referring therapists are increasingly sending Medicare-qualified patients, which should improve approval rates. For gross margins, Mr. Henry noted that Q1 margins would likely be lower due to seasonality but projected an increase throughout 2026, aiming for the 70% range by year-end, driven by higher volume, lower COGS (including a $400-$500 reduction per unit from the new mobile app), and a 2% Medicare price increase.

Scott Henry inquired about the pipeline ads in Q4 2025, which were lower at 676, asking if this was an aberration, indicative of higher quality ads, or if a bounce back to previous higher levels is expected.

Answer

CFO David Henry stated that the success of MyoConnect will be key for pipeline ads, and advertising spending will remain relatively flat. He noted that a 9-day shutdown at the end of 2025 had a slight effect on Q4 pipeline ad generation. Paul Gudonis added that MyoConnect referrals are bringing more Medicare-qualified patients, increasing approval probability.

Scott Henry asked for confirmation that revenue modeling should anticipate a significant increase in the second half of 2026 compared to the first half, driven by manufacturing capacity coming online and BARDA revenue.

Answer

Hani Luxenburg, Chief Financial Officer of MediWound, confirmed that historically, the second half of the year has shown stronger revenue performance. She agreed that, given BARDA revenue starting from Q2 and increased manufacturing capacity in the second half, the expectation for a stronger second half in 2026 is correct.

Scott Henry sought clarification on the timing of the VALUE study's interim analysis, asking if 'year-end' specifically meant Q4, and inquired about the expectation for BARDA revenues in Q1 2026. He also asked for confirmation of a projected significant revenue increase in the second half of 2026.

Answer

CEO Ofer Gonen confirmed the interim analysis is expected by the end of Q4 2026 and stated that initial BARDA revenues are anticipated only from Q2 2026. CFO Hani Luxenburg affirmed the expectation for a stronger second half of 2026, driven by the timing of BARDA revenues and increased manufacturing capacity, consistent with historical revenue patterns.

Scott Henry from Alliance Global Partners inquired about current consumable utilization trends within the installed base, sought clarification on the 2026 revenue guidance emphasizing consumables over capital sales, and asked for qualitative insights into the anticipated launch curve and customer adoption for the Proteus system. He also clarified the nature of the adjusted operating expense guidance.

Answer

Jeff Hawkins, President and CEO, confirmed consistent consumable purchases, projecting over a 25% increase in consumable kits run by customers in 2026, with very modest Platinum Pro capital sales. He explained that some Platinum Pro sales might involve credits for future Proteus purchases, impacting short-term revenue recognition. Regarding Proteus adoption, he outlined three groups: existing Platinum users, new customers drawn by Proteus's capabilities, and channel partners. Jeff Keyes, CFO, clarified that the $98 million adjusted operating expense guidance excludes stock-based compensation, focusing on cash-oriented expenses.

Scott Henry inquired about current consumable trends within the installed base, the revenue mix for 2026 focusing on consumables and service revenue over capital sales, and the anticipated launch curve for the Proteus system, including adoption by existing Platinum users, new customers, and channel partners. He also sought clarification on whether the $98 million operating expense guidance includes stock-based compensation.

Answer

Jeff Hawkins, President and CEO, noted consistent consumable purchases, with an expected 25% increase in consumable kits run in 2026, and confirmed very modest Platinum Pro capital sales, often with credits for future Proteus purchases. He described the Proteus launch curve as involving existing Platinum users, new customers drawn by Proteus's advanced applications, and global channel partners. Jeff Keyes, CFO, clarified that the $98 million adjusted operating expense guidance excludes stock-based compensation.

Scott Henry asked about the differentiation of PL7737, focusing on tolerability and hyperpigmentation, and the patient selection and endpoints for the Phase 1 SAD/MAD trial. He also inquired about the increased emphasis on Prader-Willi syndrome, the strategic positioning of Palatin's oral small molecule versus the once-weekly injectable, and the fiscal Q2 OpEx with an outlook for fiscal Q3.

Answer

Carl Spana (President and CEO, Palatin) explained that PL7737 is designed for MC4R selectivity to reduce hyperpigmentation and that GI side effects are managed by slow absorption. He noted Phase 1 SAD/MAD studies prioritize safety and dosing, but the MAD part in healthy obese patients would also assess body weight and hyperphagia reductions. Spana confirmed Prader-Willi syndrome has always been a focus due to patient numbers and views oral and injectable products as complementary for chronic conditions. Steve Wills (CFO and COO, Palatin) clarified that fiscal Q2 OpEx included over $2 million in one-time expenses not expected in fiscal Q3, projecting a $2.5 million reduction.

Scott Henry asked about the preclinical and translational signals that differentiate PL7737, particularly regarding tolerability, as it approaches IND submission. He also inquired about patient selection and expected endpoints for the Phase 1 SAD/MAD trial, the increased focus on Prader-Willi syndrome, and the strategic positioning of the oral small molecule versus the once-weekly injectable. Finally, he asked about the fiscal Q2 operating expenses and any one-time impacts.

Answer

Carl Spana, President and CEO, explained that PL7737 is designed for MC4R selectivity over MC1R to reduce hyperpigmentation and that GI side effects are controlled by slowing absorption to avoid large spikes. He noted that Phase 1 SAD/MAD trials are primarily safety studies in healthy obese patients, aiming to confirm oral absorption, safety, and define a dosing window. For the MAD part, they expect to see reductions in body weight and hyperphagia. Spana clarified that Prader-Willi syndrome has always been a focus, alongside hypothalamic obesity, due to the substantial patient populations in these rare indications. He views the oral and injectable products as complementary, each suited for different patient populations, with injectables potentially offering higher efficacy for chronic, aggressive therapy. Steve Wills, CFO and COO, added that fiscal Q2 operating expenses included over $2 million in one-time extraordinary expenses not expected to recur, anticipating approximately $2.5 million less in fiscal Q3 2026.

Scott Henry inquired about Palatin's obesity program, specifically asking if higher doses of bremelanotide could match weight loss from drugs like Wegovy, the future of weight maintenance as a labeled indication, and the key benefits of the next-generation MCR4 agonists over earlier versions.

Answer

Executive Carl Spana confirmed that earlier studies with higher doses of bremelanotide have shown weight loss comparable to single-agent drugs like Wegovy. He strongly agreed that weight maintenance will be a critical future indication, stating that MCR4 agonists are 'ideally suited' for this role. Spana detailed that next-generation MCR4s are being developed to eliminate skin pigmentation side effects and offer more convenient dosing, like once-weekly injections or once-daily oral pills, to achieve a steady state for optimal efficacy.

Scott Henry inquired about Palatin's obesity program, asking if higher doses of bremelanotide could achieve weight loss comparable to leading drugs like Wegovy, the potential for MCR4 agonists in long-term weight maintenance, and the key benefits of the company's next-generation MCR4 compounds.

Answer

Carl Spana, an executive at Palatin, explained that earlier studies with higher doses of bremelanotide showed weight loss comparable to single-agent Wegovy. He affirmed that MCR4 agonists are ideally suited for long-term weight maintenance, addressing the rebound weight gain seen with GLP-1 therapies. Spana highlighted that next-generation MCR4s are designed to eliminate skin pigmentation side effects and offer more patient-friendly dosing, such as once-weekly injections or once-daily oral molecules, to maintain a crucial steady therapeutic state.

Scott Henry asked for insights into the expected quarterly revenue cadence for the $35 million 2026 guidance, the underlying confidence from pre-orders, the anticipated revenue contribution from the VasoHealthcare IT acquisition, and the growth outlook for the teleradiology business in 2026.

Answer

CEO Erez Meltzer stated that the 2026 guidance is supported by pre-orders, partnerships, and sales efforts, projecting an exponential ramp-up from Q1 to Q4. CFO Ran Daniel specified that VasoHealthcare IT is expected to contribute approximately $4 million in revenue. CEO Meltzer clarified that the guidance does not rely on significant teleradiology growth, with the primary drivers being the ARC business (especially ARC X and regulatory advancements) and the AI segment.

Scott Henry asked about the expected revenue cadence for the $35 million 2026 guidance, inquiring if it would be a Q1 ramp or second-half weighted, and the confidence level based on pre-orders. He also questioned the growth expectations for the teleradiology segment, given its strong Q3 2025 performance and historical growth rates.

Answer

CEO Erez Meltzer indicated that the 2026 revenue would start slowly in Q1 and ramp up exponentially through Q4, driven by pre-orders, business partners, retail expansion, and the sales force. CFO Ran Daniel added that the Vaso acquisition would contribute approximately $4 million to 2026 revenues. Erez Meltzer clarified that the guidance does not assume a significant leap in teleradiology growth, with most growth expected from the ARC and AI businesses, and OEM growth projected for 2027.

Inquired about the revenue outlook for Q3/Q4, the sustainability of service revenue streams, the expected run-rate for operating expenses post-acquisition, and the financial contribution of the SCN acquisition in Q2.

Answer

Management expects revenue to grow as more 'SO teams' are deployed, with a shift towards higher product revenue from SCN referrals. The increase in testing revenue is sustainable and expected to grow. Q2 operating expenses included approximately $700,000-$800,000 in one-time, non-recurring acquisition costs. The SCN acquisition only contributed for 20 days in Q2 (since June 9), generating about $500,000 in revenue.

Inquired about the sequential revenue outlook for the fourth quarter, the nature of the Q3 VIP revenue and its future trend, and the timeline for geographic expansion of the new business model.

Answer

Q4 is viewed as a transition quarter with revenue expected to be flat to slightly up as the new model's revenue begins to replace the old one. The Q3 VIP revenue included an accounting catch-up, and the remaining deferred revenue will be recognized over the next year. The company is already working on geographic expansion beyond Colorado by leveraging telemedicine networks.

Scott Henry asked for clarification on the TIGER-PACT trial size and data release strategy, enrollment pace, and timing for the PANTHER trial data. In a follow-up, he inquired about the catheter business's gross margins, profitability, and revenue expectations for the rest of the year.

Answer

The company confirmed the TIGER-PACT trial size remains unchanged, which is a positive sign. The second interim data is being withheld to protect trial integrity as it nears completion. Enrollment is expected to complete by late 2025/early 2026, with a ramp-up anticipated from new, larger centers. PANTHER trial data will be released as findings emerge. On the catheter business, gross margins are strong (around 64%) and expected to grow to 70-90%. The business is already accretive, and while no formal guidance was given, growth is expected through 2025 with a significant ramp in 2026.

Inquired about the implied net revenue per script for Amrozi, the potential impact of summer seasonality on the rosacea market, and the specific quarterly revenue for QBREXZA.

Answer

The company advised against calculating a simple net revenue per script due to noise from patient assistance programs and reimbursement delays, and declined to provide guidance on the ASP. They believe the strong launch momentum for Amrozi will outweigh any typical summer seasonality effects. QBREXZA revenue for the quarter was confirmed to be $6.9 million.

Scott Henry of ROTH Capital Partners questioned the Q3 results being at the low end of expectations, asking about potential strategic adjustments to the sales force investment. He also probed for confidence in sequential Q4 growth, the performance and future growth potential of Accutane, the expected recovery amount from the cryptocurrency theft, and the launch timing for the company's new anti-itch product.

Answer

CEO Claude Maraoui acknowledged the lower Q3 revenue but indicated a stronger start to Q4 and a focus on organizational efficiencies, without providing specific guidance. He affirmed that Accutane has significant growth potential despite a recent market-wide dip, as it maintained its market share. General Counsel Ramsey Alloush clarified that the amount recovered from the crypto theft will depend on the asset's price at the time of conversion back to USD. CEO Maraoui concluded that the anti-itch product launch is still anticipated but remains dependent on manufacturing timelines.

Scott Henry inquired about Palatin's obesity program, focusing on whether higher doses of bremelanotide could enhance weight loss, the potential for weight maintenance as a future labeled indication, and the differentiating benefits of next-generation MCR4 agonists.

Answer

Executive Carl Spana explained that earlier studies with higher doses of bremelanotide showed weight loss comparable to single-agent drugs like Wegovy. He affirmed that weight maintenance is a key future focus, with MCR4 agonists being ideally suited to prevent the weight regain seen with GLP-1s. Spana highlighted that next-generation MCR4s are being developed to eliminate skin pigmentation, offer once-weekly or once-daily oral dosing for better patient compliance, and maintain a steady therapeutic state.

Asked for feedback on the Yalos launch, its peak annual revenue potential, and the revenue outlook for Casterra in 2025 compared to 2024.

Answer

The company reported good feedback for Yalos, with peak sales potential in the 'significant double-digit millions of dollars'. For Casterra, they expect 2025 revenues to be better than 2024, supported by resolved production issues, but could not provide a specific forecast due to ongoing discussions.

Scott Henry of Roth Capital Partners inquired about the expected structure of the MAT2203 partnership deal, the revised timeline for the ORALTO Phase III trial, and the interpretation of weight loss observed in oncology studies using the LNC platform.

Answer

Executive Jerome Jabbour confirmed that a definitive agreement for MAT2203 is expected to include an upfront payment, milestones, and royalties. He acknowledged a delay in the ORALTO trial, projecting a study initiation in Q4 2024 but a first patient visit in early 2025. Regarding the LNC platform, Jabbour explained that weight loss in animal models is being investigated, attributing it potentially to high doses and gavage issues with docetaxel, and to the agent's inherent toxicity with miriplatin, rather than the LNC platform itself.

Scott Henry of Roth MKM inquired about the structure of the nonbinding term sheet for MAT2203, the updated timeline for the ORALTO Phase III trial, and the interpretation of weight loss seen in LNC platform oncology studies.

Answer

Executive Jerome Jabbour explained that a definitive MAT2203 agreement would likely include an upfront payment, milestones, and royalties. He acknowledged a delay in the ORALTO trial, projecting initiation in Q4 2024 but the first patient visit in early 2025, attributing the delay to thorough due diligence. Regarding the LNC platform, he suggested weight loss in docetaxel studies could be dose-related, while for miriplatin, it is likely due to the agent's inherent toxicity rather than the delivery platform.

Scott Henry of ROTH Capital Partners inquired about the potential structure of the MAT2203 partnership, the updated timeline for the ORALTO trial, and the interpretation of weight loss observed in LNC platform oncology studies.

Answer

Executive Jerome Jabbour confirmed a potential MAT2203 deal would likely include an upfront payment, milestones, and royalties. He acknowledged a delay in the ORALTO trial start, now targeting initiation in Q4 2024 with the first patient visit likely in early 2025, attributing the delay to a thorough due diligence process. Regarding the LNC platform, Jabbour explained that weight loss in animal studies is being evaluated; for LNC-docetaxel, it could be dose-related, while for LNC-miriplatin, it is likely due to the toxicity of the agent itself.

Inquired about the timing of the 10-Q filing, the outlook for organic growth in fiscal 2025, and the company's stance on M&A, including whether an acquisition is needed to achieve necessary scale.

Answer

The 10-Q is expected on Monday. The company sees organic growth opportunities in both its bracing and rehab segments but declined to provide specific growth targets. While acquisitions are part of the long-term strategy, the immediate focus is on stabilizing the core business and achieving profitability before pursuing deals.

Scott Henry from ROTH Capital Partners inquired about the INM-755 trial, asking if any efficacy data was gleaned from the recent safety review, what the next steps are post-readout, and about the company's current and projected cash burn rate.

Answer

President and CEO Eric Adams clarified that the company was blinded to efficacy data from the safety review and confirmed that an additional trial will be required after the Phase 2 study. Interim CFO Brenda Edwards detailed the cash burn, stating the all-in run rate was about $900,000/month in the last quarter, with a target of reducing it to approximately $700,000/month, and operating expenses alone projected at around $500,000/month.

Scott Henry from ROTH Capital Partners asked for insight into the potential peak sales for BayMedica's key cannabinoid molecules (CBC, CBT, CBDV, THCV), the revenue level required for the BayMedica division to achieve breakeven, and clarification on the company's cash runway and R&D expense outlook.

Answer

CEO Eric Adams and Shane Johnson, SVP and GM of BayMedica, stated it is too early to forecast peak sales but noted that upcoming products CBDV and THCV represent more substantial opportunities than the currently launched CBC and CBT. CFO Bruce Colwill explained that the company is prioritizing investment in new product launches for first-mover advantage over near-term breakeven for the BayMedica unit. Colwill confirmed the cash runway extends into Q1 of fiscal 2023 and projected that R&D spending may decrease in the second half of fiscal '22 as INM-755 trial expenses wind down.

Scott Henry of ROTH Capital Partners questioned InMed's fiscal 2022 revenue forecast following the BayMedica acquisition, the commercialization strategy for its IntegraSyn manufacturing platform, and the data release timeline for the INM-755 Phase 2 trial.

Answer

CFO Bruce Colwill stated it was premature to offer 2022 revenue guidance but noted BayMedica's historical 35% quarter-over-quarter sales growth. President and CEO Eric Adams described a flexible manufacturing strategy, using IntegraSyn alongside other methods based on cost and market needs. SVP, Clinical and Regulatory Affairs, Alexandra Mancini estimated a roughly four-month period from the last patient's completion to public data release for the INM-755 trial.

Scott Henry from ROTH Capital Markets inquired about InMed's cash runway guidance, future operating expense trends, the expected timeline for data from the INM-755 Phase 2 trial, and the company's strategic plans for its IntegraSyn manufacturing platform.

Answer

CFO Bruce Colwill clarified that cash runway guidance, previously extending into Q3 calendar 2021, is being updated due to the Phase 2 trial ramp-up, with new guidance forthcoming. He projected that recent expense levels would be indicative of the next few quarters. SVP of Clinical and Regulatory Affairs, Alexandra Mancini, projected data from the 201 trial in late 2022, detailing the cautious, year-long enrollment process for the rare disease study. CEO Eric Adams explained that achieving the 1kg batch size for IntegraSyn is a key step towards commercial scale-up, and the company is exploring all options, including self-commercialization or licensing.

Scott Henry from ROTH Capital Partners questioned the reason for the earnings call's timing and sought a detailed definition of the 'cash flow positive from operations' target, including which expenses are included and how the company plans to achieve it.

Answer

CEO Dror Ben-Asher cited reasons like the recently improved credit agreement for the call's timing. CFO Micha Ben-Chorin clarified that the cash flow positive target includes all G&A and selling expenses (excluding non-cash stock compensation) and will be reached through significant cost reductions across R&D, sales, and marketing, coupled with continued revenue growth.

Scott Henry of ROTH Capital questioned the flat sequential revenue growth from Q2 to Q3, the resource allocation for Aemcolo, and the timeline for achieving a sustainable decline in operating loss. He also asked about the sustainability of the Q3 gross margin and the potential duration of a confirmatory trial for opaganib.

Answer

CFO Micha Ben-Chorin clarified that both Movantik and Talicia revenues grew sequentially, but Aemcolo had a negative impact. SVP Rob Jackson added that Aemcolo uses very few resources. Regarding gross margin, Micha expects Q4 to be slightly lower than Q3 but better than Q1 and Q2. COO Gilead Raday estimated that a confirmatory opaganib trial could be completed in under a year.

Scott Henry inquired about the outlook for R&D and G&A spending, sought clarification on the 'commercial operations breakeven' goal, asked for a more specific timeline for opaganib data, and questioned the necessity of additional U.S. studies for opaganib.

Answer

CFO Micha Ben-Chorin projected R&D spend to be between Q1 and Q2 levels and stated G&A would normalize after a one-time stock option expense. He defined breakeven as non-GAAP gross profit exceeding commercial costs by year-end. CEO Dror Ben-Asher confirmed opaganib data would be released before the end of Q3 and clarified that while the FDA has indicated a need for more studies, the data will dictate all regulatory discussions, especially ex-U.S.

Scott Henry of Roth Capital Partners inquired about Discovery Labs' capital position, including cash runway and debt covenants. He also asked about the potential financial structure of a SURFAXIN partnership, the magnitude of potential cost savings, the implications of the AEROSURF trial being open-label, and the possibility of an ex-U.S. partnership for AEROSURF.

Answer

CFO John Tattory confirmed the $44.7 million in cash is projected to last through Q1 2016 with no restrictive covenants, and that divesting SURFAXIN could save approximately $4.5 million per quarter. CEO John Cooper stated the goal is to maximize value in any SURFAXIN deal and that the company is actively exploring AEROSURF partnerships, though timing is uncertain. Chief Development Officer Steven Simonson affirmed that the open-label nature of the AEROSURF trial provides encouraging, early visibility into the data.