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AP

ANI PHARMACEUTICALS INC (ANIP)·Q4 2024 Earnings Summary

Executive Summary

  • Record quarter: total net revenues $190.6M (+44.8% YoY), adjusted non-GAAP EBITDA $50.0M (+65.7% YoY), and adjusted diluted EPS $1.63; GAAP diluted loss per share $(0.55) as mix and Alimera inventory step-up weighed on GAAP gross margins .
  • Rare Disease momentum: Cortrophin Gel $59.4M (+42.3% YoY), first full quarter of ILUVIEN/YUTIQ $27.6M; Generics $78.6M (+9.4% YoY); Brands $19.8M (+58.9% YoY) .
  • Guidance raised for FY2025: total net revenue to $756–$776M, adjusted EBITDA to $190–$200M, and new adjusted EPS $6.12–$6.49; Rare Disease revenue to 48–49% of company, with Cortrophin Gel $265–$274M and ILUVIEN/YUTIQ $97–$103M .
  • Near-term watch items: Q1 seasonal downtick in Rare Disease; Medicare access program funding changes affecting ILUVIEN/YUTIQ in Q1; PAS to add NIU-PS to ILUVIEN label targeted for Q2 2025; NEW DAY and SYNCHRONICITY top-line in Q2 2025 .

What Went Well and What Went Wrong

What Went Well

  • Rare Disease growth and mix: Cortrophin Gel revenue up 42.3% YoY to $59.4M, with record new patient starts and broad specialty uptake; ILUVIEN/YUTIQ $27.6M in first full quarter post-Alimera acquisition .
  • Margin improvement on non-GAAP basis: non-GAAP gross margin rose to 63.5% (from 59.6%), driven by favorable product mix (Cortrophin Gel, Brands, and full-quarter ILUVIEN/YUTIQ) .
  • Strategic execution: Expanded ophthalmology sales force to 46 reps; manufacturing capacity expansion with Siegfried to secure ILUVIEN supply; PAS filed to consolidate YUTIQ indication onto ILUVIEN label, expected Q2 2025 .

Management quotes:

  • “We’re thrilled to report another year of strong execution... capped by our record fourth quarter results... we are raising our 2025 guidance...” — Nikhil Lalwani, CEO .
  • “We expect preliminary top-line data from both [NEW DAY and SYNCHRONICITY] in the second quarter of 2025.” — Management on clinical catalysts .

What Went Wrong

  • GAAP pressure: GAAP gross margin fell to 57.9% (from 59.4%) due to royalty-bearing products and Alimera inventory fair-value step up; GAAP diluted loss per share $(0.55) as SG&A rose with expanded sales and integration .
  • ILUVIEN/YUTIQ Q1 headwinds: Medicare program funding changes reduce access for Medicare patients in early 2025; management expects Q1 to be below Q4 before sequential improvement in Q2 .
  • Elevated operating expenses: Non-GAAP SG&A +41.8% to $54.8M and non-GAAP R&D +68.1% to $16.2M from clinical spend and commercial build-out; GAAP SG&A +56.8% to $69.7M .

Financial Results

MetricQ2 2024Q3 2024Q4 2024
Total Net Revenues ($USD Millions)$138.0 $148.3 $190.6
GAAP Diluted EPS ($)$(0.14) $(1.27) $(0.55)
Adjusted non-GAAP Diluted EPS ($)$1.02 $1.34 $1.63
GAAP Gross Margin (%)N/A57.5% 57.9%
Non-GAAP Gross Margin (%)N/A59.9% 63.5%
Adjusted non-GAAP EBITDA ($USD Millions)$33.2 $35.1 $50.0

Segment breakdown:

Segment ($USD Millions)Q2 2024Q3 2024Q4 2024
Cortrophin Gel$49.2 $52.6 $59.4
ILUVIEN & YUTIQ—$3.9 $27.6
Rare Disease Total$49.2 $56.4 $87.0
Brands / Established Brands$14.9 $13.7 $19.8
Generics$74.0 $78.2 $78.6
Royalties & OtherN/AN/A$5.1
Total Net Revenues$138.0 $148.3 $190.6

KPIs and operating metrics:

KPIQ2 2024Q3 2024Q4 2024
Non-GAAP R&D ($USD Millions)$7.0 $8.7 $16.2
Non-GAAP SG&A ($USD Millions)$40.5 $45.0 $54.8
Unrestricted Cash ($USD Millions)$240.1 $145.0 $144.9
Principal Debt Outstanding ($USD Millions)$292.5 $641.3 $639.2
Cash From Operations YTD ($USD Millions)$35.7 $48.2 $64.0

Note: Estimates comparison vs Wall Street consensus unavailable due to S&P Global request limit; S&P Global data could not be retrieved.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Revenue (Total Company)FY 2025$739M–$759M $756M–$776M Raised
Adjusted non-GAAP EBITDAFY 2025$182M–$192M $190M–$200M Raised
Adjusted non-GAAP Diluted EPSFY 2025n/p $6.12–$6.49 New
Cortrophin Gel Net RevenueFY 2025n/p $265M–$274M New
ILUVIEN & YUTIQ Net RevenueFY 2025n/p $97M–$103M New
Adjusted non-GAAP Gross Margin %FY 2025n/p63%–64% New
Shares for adjusted diluted EPSFY 2025n/p~20.1M–20.4M New
GAAP effective tax rateFY 2025n/p~25% New

n/p = not provided in January 13, 2025 preliminary guidance .

Earnings Call Themes & Trends

TopicQ2 2024 (Prev-2)Q3 2024 (Prev-1)Q4 2024 (Current)Trend
Cortrophin Gel growth$49.2M; record demand; guidance raised to $185–$195M for FY2024 $52.6M; record new starts/prescribers; FY2024 guidance raised to $196–$200M $59.4M; highest quarterly new starts; FY2025 $265–$274M; ~15% use in gout, ~40% naive prescribers Strong, accelerating
Ophthalmology franchise (ILUVIEN/YUTIQ)Announced Alimera acquisition plan Closed 9/16; $3.9M contribution; 45-person sales force; debt refinanced $27.6M Q4; Q1 Medicare funding programs reduce access; PAS to add NIU-PS to ILUVIEN; capacity expansion at Siegfried Building; near-term Q1 headwind; medium-term positive
Clinical catalystsN/ANEW DAY (ILUVIEN) and SYNCHRONICITY (YUTIQ) top-line in Q2 2025 Reiterated Q2 2025 timing; potential to expand ILUVIEN earlier in DME journey Approaching readouts
Manufacturing & supplyNJ capacity expansion for Generics ILUVIEN at Siegfried; plan for YUTIQ transition; synergies in 2025 Siegfried extension to 2029; equipment upgrade + second line; EyePoint supply non-renewal effective 5/31/2025 Strengthening supply security
Generics execution$74.0M (+16.8% YoY); multiple launches $78.2M (+10.8% YoY); 17 launches YTD $78.6M (+9.4% YoY); prucalopride launch with 180-day exclusivity Sustained low double-digit growth
Medicare/macroN/AN/AMedicare program funding changes impacting ILUVIEN/YUTIQ in Q1 2025; Part D out-of-pocket cap and smoothing positive tailwinds broadly Mixed near-term; constructive longer-term

Management Commentary

  • “Total net revenues, adjusted non-GAAP EBITDA, and adjusted non-GAAP diluted EPS all finishing above our previously announced guidance for the full year.” — Nikhil Lalwani, CEO .
  • “We are raising our 2025 guidance for total net revenues and adjusted non-GAAP EBITDA.” — Nikhil Lalwani .
  • “We submitted a prior approval supplement (PAS) to the FDA… to add YUTIQ’s indication… to the ILUVIEN label… expect FDA approval… in Q2 2025.” — Management .
  • “Adjusted non-GAAP gross margin [was] 63.5%, primarily driven by favorable product mix.” — CFO Stephen Carey .

Q&A Highlights

  • ILUVIEN/YUTIQ access: Medicare and Medicare Advantage assistance programs lacked adequate funding early 2025; ANI using patient assistance programs and refining commercial approach; Q1 lower than Q4 with sequential growth resuming in Q2 .
  • Label consolidation: PAS to add NIU-PS to ILUVIEN; transition reduces SKUs and simplifies office processes; EyePoint supply non-renewal after 5/31/2025, Siegfried capacity expansion underway .
  • Cortrophin Gel mix: ~15% of volume from gout; ~40% prescribers were naive to ACTH; seasonality expected Q1 down then Q2 recovery .
  • Generics growth drivers: Volume-led growth from 2024 launches, new 2025 launches (incl. prucalopride 180-day exclusivity), not reliant on competitor supply issues; expect low double-digit growth .
  • M&A/leverage: Management historically targets net leverage under ~3x and expects capacity for BD/M&A with current capital structure and deleveraging path .

Estimates Context

  • S&P Global consensus EPS/revenue estimates for Q4 2024 and prior quarters were not retrievable due to request limits. As a result, estimate comparisons are unavailable; generally, management indicated full-year results finished above previously announced guidance, and FY2025 guidance was raised .
  • Values would have been retrieved from S&P Global if access permitted.

Key Takeaways for Investors

  • Rare Disease flywheel intact: Cortrophin Gel continues strong volume-led growth across specialties; ILUVIEN/YUTIQ framework (sales force, PAS, capacity) targets durable multi-year runway despite Q1 access headwinds; monitor Q2 sequential inflection and PAS outcome .
  • Mix supports margins on non-GAAP basis: Rising Cortrophin/Brands/ILUVIEN/YUTIQ mix lifted non-GAAP gross margin to 63.5%; GAAP margin will remain sensitive to royalty-bearing products and acquisition accounting; track normalization as Alimera step-up amortization rolls off .
  • 2025 setup strengthened: Guidance raised across revenue and EBITDA with new adjusted EPS range; Rare Disease to ~48–49% of revenue; watch Q1 seasonality and Medicare impact, then Q2 reacceleration .
  • Catalysts near-term: PAS decision (Q2 2025) enabling label consolidation and supply simplification; NEW DAY/SYNCHRONICITY top-line (Q2 2025) could expand ILUVIEN earlier in DME care pathway; potential commercial tailwinds if data positive .
  • Generics steady: Expect low double-digit growth driven by launches (e.g., prucalopride exclusivity) and U.S. manufacturing; provides cash flow and diversification .
  • Balance sheet and leverage: ~$145M cash, ~$639M debt; management targets forward net leverage ~2.5x based on guidance midpoint; provides M&A flexibility while prioritizing Rare Disease .
  • Trading implications: Near-term volatility possible around Q1 access dynamics; focus on Q2 sequential recovery, PAS approval timing, and Q2 clinical readouts as stock-moving events; medium-term thesis anchored on Rare Disease mix expansion and execution on ophthalmology transition .