Executive Summary

AcelRx (now Talphera) delivered a cleaner Q3 with net loss per share of $0.08 vs. $0.40 in Q2 and $0.75 in Q1, driven by lower operating expenses and higher other income; royalty revenue was $0.12M as DSUVIA transitions to Alora .
EPS materially beat third‑party consensus (Seeking Alpha) of -$0.26; revenue of $0.117M was slightly below the $0.13M expectation; management attributed revenue timing to shipment phasing expected to be realized in Q4 (call) .
Regulatory momentum improved: FDA granted IDE approval for Niyad; the Phase 3 NEPHRO registrational study starts in Q4 with topline data targeted mid‑2024 and PMA submission planned in 2H24, sustaining a clear catalyst track .
Liquidity was $13.4M in cash and investments at 9/30; July financing provides up to $26.3M (with $10M immediately funded), easing near‑term runway as development advances .
Stock reaction catalysts: confirmation of NEPHRO enrollment cadence, mid‑2024 topline timing, and signs of steadier royalty inflows from DoD channel could drive volatility, with potential upside if timelines hold and expense discipline persists .

What Went Well and What Went Wrong

What Went Well

FDA IDE approval and IRB clearance enabled the Niyad NEPHRO registrational trial to start in Q4, with management reiterating topline by mid‑2024 and PMA in 2H24, tightening the regulatory path and timeline .
Operating discipline: combined R&D+SG&A fell to $3.4M (non‑GAAP $3.0M) from $4.5M (non‑GAAP $3.9M) YoY in Q3, reflecting headcount reductions while supporting Niyad development .
Financing flexibility improved with July private placement ($10M immediate, up to $26.3M gross potential via warrant exercises) led by new healthcare investors, supporting milestone execution for Niyad .

What Went Wrong

Revenue came in at $0.117M, slightly below third‑party consensus of $0.13M, as royalty timing (not demand) weighed on Q3; management expects catch‑up in Q4 (call) .
The business remains dependent on a single late‑stage asset (Niyad) and royalty from DSUVIA, with minimal top‑line scale near‑term, increasing sensitivity to execution and regulatory timing .
Continued operating loss from continuing operations ($1.418M) underscores limited revenue base and the need for financing/lower burn until Niyad commercialization potential is realized .

Financial Results

Metric	Q1 2023	Q2 2023	Q3 2023
Revenue ($USD Millions)	— (no royalty line item; DSUVIA in discontinued ops)	$0.253	$0.117
Net Income (Loss) – Continuing Ops ($USD Millions)	$0.064	$(4.428)	$(1.418)
Net Income (Loss) – Total ($USD Millions)	$(8.152)	$(4.371)	$(1.357)
GAAP EPS (Diluted), Total ($)	$(0.75)	$(0.40)	$(0.08)
R&D Expense ($USD Millions)	$1.047	$1.552	$1.178
SG&A Expense ($USD Millions)	$4.281	$2.670	$2.248
Total Operating Expenses ($USD Millions)	$5.328	$4.222	$3.426
Other Income (Expense), net ($USD Millions)	$5.392	$(0.456)	$1.893
Cash & Investments at Period End ($USD Millions)	$13.353	$7.410	$13.389

Notes:

Q1 2023 revenue for continuing operations was not presented as a separate line item; DSUVIA results were classified in discontinued operations after the divestment .

Estimates vs. Actuals (Q3 2023):

Source note: S&P Global consensus was not available for ACRX via our estimates tool. We cite third‑party published previews instead.

Metric	Actual	Consensus	Surprise
GAAP EPS (Diluted) ($)	$(0.08)	$(0.26)	+$0.18 (beat)
Revenue ($USD Millions)	$0.117	$0.13	$(0.015) (miss)

KPI/Operating Detail (Q3 2023, with YoY comps where available):

Combined R&D+SG&A: $3.4M (non‑GAAP $3.0M) vs. $4.5M (non‑GAAP $3.9M) in Q3’22, reflecting headcount reductions offset by Niyad study spend .
DSUVIA royalties: $0.1M in Q3’23 primarily from DoD sales; prior period revenues were included in discontinued operations .
Other income: $1.893M, supporting narrower net loss despite minimal revenue .

Guidance Changes

Metric/Item	Period	Previous Guidance	Current Guidance	Change
Combined R&D + SG&A (ex non‑cash)	FY 2023	$16–$20M (communicated earlier)	$16–$20M (remain on track)	Maintained
NEPHRO registrational study start	Q4 2023	Start in Q4 2023	Start in Q4 2023; IDE approved	Maintained (de‑risked by IDE)
NEPHRO topline	Mid‑2024	Mid‑2024	Mid‑2024	Maintained
PMA submission (Niyad)	2H 2024	2H 2024	2H 2024	Maintained
Niyad EUA status	2023	EUA request submitted Apr 27, 2023; awaiting response	No update provided in Q3 release	Unchanged/Not updated

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 & Q2 2023)	Current Period (Q3 2023)	Trend
Regulatory pathway (EUA/IDE/PMA)	Q1: EUA submitted for Niyad (Apr 27) . Q2: Registrational study set to initiate Q4; mid‑2024 topline; 2H24 PMA .	IDE approval received; NEPHRO starts in Q4; topline mid‑2024; PMA in 2H24 reiterated .	Positive momentum; timeline reaffirmed
Financing & runway	Q1: Cash $13.4M; DSUVIA divestment closed . Q2: $10M immediate from private placement; up to $26.3M potential .	Same financing reiterated; $13.4M cash at 9/30; expense guidance maintained (ex non‑cash) .	Improved flexibility; discipline maintained
DSUVIA royalty profile	Q2: $0.253M royalties; DoD is key customer .	$0.117M in Q3; management cited timing of shipments with expected realization in Q4 (call) .	Lumpy quarterly cadence; Q4 rebound expected
R&D execution – Niyad	Q1: API supply in place; stability data positive . Q2: Six‑month stability data met criteria .	IRB and IDE clearances; detailed NEPHRO design and endpoints specified .	Advancing as planned
Market development/KOL	Q1: 150‑physician market research supports need .	KOL panel scheduled Dec 6 to discuss research and NEPHRO study .	Continued KOL engagement

Management Commentary

“We continue to advance our lead product candidate Niyad™, that has FDA Breakthrough Device designation, by prioritizing our resources to achieve regulatory and development milestones on this asset… we received IDE approval from the FDA to proceed with the Niyad NEPHRO CRRT Study… set to start this quarter with top-line data expected by mid-2024 and… PMA… in the second half of next year.” – Vince Angotti, CEO .
“The cash and cash equivalents balance was $13.4 million as of September 30, 2023… Revenues of $0.1 million… primarily represent the royalty revenue earned on the sales of DSUVIA by Alora, principally driven by sales to the Department of Defense… Combined R&D and SG&A expenses… totaled $3.4 million.” – Press release financial highlights .
“We ended the quarter with $13.4 million in cash… This financing provides capital of up to $26 million… Revenues for the third quarter of $0.1 million were… impacted by timing of shipments… expected to be realized in the fourth quarter… We remain on track to stay within… full‑year 2023 combined R&D and SG&A expense guidance (ex non‑cash) of $16–$20 million.” – Raffi Asadorian, CFO (call) .

Q&A Highlights

NEPHRO enrollment and timing: Management emphasized robust expected enrollment and reaffirmed mid‑2024 topline and 2H24 PMA timing; IDE approval de‑risked trial start (call) .
Royalty cadence: Q3 royalties were affected by shipment timing with expectation of catch‑up in Q4, indicating quarterly lumpiness rather than demand weakness (call) .
Expense framework: Reiterated confidence in achieving FY23 combined R&D+SG&A (ex non‑cash) of $16–$20M, reflecting continued discipline as Niyad advances (call) .
Participants included H.C. Wainwright and Alliance Global Partners (per published transcript headers), focusing on development timelines and financial runway .

Estimates Context

S&P Global consensus was unavailable via our tool for ACRX this quarter. As a proxy, third‑party published preview data indicated EPS consensus of -$0.26 and revenue of ~$0.13M; AcelRx reported EPS of -$0.08 (beat by ~$0.18) and revenue of $0.117M (miss by ~$0.015M) .
Potential estimate revisions: modest EPS upward revisions are plausible given the beat and lower opex; revenue models may incorporate Q4 catch‑up from shipment timing but retain low base until Niyad commercialization .

Key Takeaways for Investors

Regulatory de‑risking: IDE approval and imminent registrational start underpin a catalyst path (mid‑2024 topline; 2H24 PMA) that can re‑rate development risk if met .
Expense discipline is tangible: opex trending down (GAAP and non‑GAAP), supporting narrower losses even with minimal revenue; FY23 spend guidance (ex non‑cash) reaffirmed at $16–$20M .
Revenue remains lumpy and immaterial near‑term; DSUVIA royalties are DoD‑weighted and subject to shipment timing (Q4 recovery expected per management) .
Balance sheet improved with $13.4M cash at Q3 and up to $26.3M potential from July financing, providing flexibility to execute the NEPHRO study .
Trading setup: shares may respond to clinical execution headlines (site activations, enrollment pace), any EUA update, and confirmation that Q4 royalties rebound—key watch items into mid‑2024 topline .
Medium‑term thesis: success on Niyad (first‑ever U.S. approved regional anticoagulant for dialysis circuits) could unlock a new commercial opportunity in medically supervised settings; failure or delay would likely necessitate further capital given limited current revenue .

Citations:

Q3 2023 8‑K and Exhibit 99.1 press release: .
Q2 2023 8‑K and Exhibit 99.1 press release: .
Q1 2023 8‑K and Exhibit 99.1 press release: .
Earnings call transcript excerpts and event page: .
Third‑party consensus preview: .

Disclaimer on estimates: S&P Global consensus data was unavailable for ACRX via our tool this quarter; third‑party published previews were used instead.

TALPHERA, INC. (ACRX)·Q3 2023 Earnings Summary