Sign in

You're signed outSign in or to get full access.

PB

Pacira BioSciences, Inc. (PCRX)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 delivered mixed results: EPS beat but revenue slightly missed consensus; non-GAAP gross margin raised for the year on manufacturing efficiencies and RDF royalty elimination .
  • Revenue was $181.1M vs consensus ~$182.8M*, driven by EXPAREL volume growth (+6% YoY) offset by vial mix and GPO discounting; non-GAAP diluted EPS was $0.74 vs consensus ~$0.71*, a beat .
  • FY25 guidance tightened: total revenue narrowed to $730–$750M (from $725–$765M) and non-GAAP gross margin increased to 78–80% (from 76–78%); R&D, SG&A, and SBC ranges reiterated .
  • Strategic catalysts: J&J MedTech co-promotion expected to materially extend ZILRETTA reach; new $300M revolver improves flexibility; patent and legal milestones reinforce EXPAREL runway and margin trajectory .

What Went Well and What Went Wrong

What Went Well

  • EXPAREL volume growth of 6% YoY (highest in eight quarters) supported EPS beat and raised gross margin outlook; “we delivered several key milestones to advance our five-by-30 path to growth” .
  • Non-GAAP gross margin improved to 82% (Q2), aided by large-scale 200L manufacturing and decommissioning of the 45L suite; full-year margin guidance raised to 78–80% .
  • Market access momentum: >40M commercial lives now covered; targeting ~60M by year-end and ~100M total lives (commercial+government), creating leverage for broader EXPAREL utilization .
    Quote: “We are seeing encouraging momentum… EXPAREL is poised for sustainable growth and expanded market leadership” — CEO Frank Lee .

What Went Wrong

  • Top line missed consensus as vial mix and new GPO discounting modestly pressured net sales despite stronger volume growth .
  • Operating expenses rose materially (SG&A $88.6M vs $68.1M YoY; R&D $28.2M vs $20.3M), reflecting investments in commercial, medical, market access, and pipeline advancement .
  • EBITDA down YoY (adjusted EBITDA $54.3M vs $62.1M) on higher opex and transitional effects; management emphasized cost actions including workforce optimization and suite decommissioning .

Financial Results

Consolidated Performance (YoY and Sequential)

MetricQ4 2024Q1 2025Q2 2025
Total Revenues ($M)$187.3 $168.9 $181.1
GAAP Diluted EPS ($)$0.34 $0.10 $(0.11)
Non-GAAP Diluted EPS ($)$0.91 $0.62 $0.74
GAAP Gross Margin (%)79% 80% 77%
Non-GAAP Gross Margin (%)79% 81% 82%
Adjusted EBITDA ($M)$62.5 $44.1 $54.3

Segment Net Product Sales

Product ($M)Q4 2024Q1 2025Q2 2025
EXPAREL$147.7 $136.5 $142.9
ZILRETTA$33.1 $23.3 $31.3
iovera°$6.5 $5.1 $5.6
Bupivacaine license$0.0 $2.6 $0.5

KPIs and Balance Sheet

KPIQ4 2024Q1 2025Q2 2025
Cash & ST Investments ($M)$484.6 (cash+AFS) $493.6 (cash+AFS) $445.9; pro forma ~$270 post note repayment and RDF cash receipt
Share Repurchases$25M executed in 2024 Authorization raised to $300M through 2026 $50M (2.0M shares repurchased)
Non-GAAP SG&A ($M)$78.6 (Q4) $76.2 (Q1) $77.2 (Q2)
Non-GAAP R&D ($M)$22.0 (Q4) $23.1 (Q1) $24.7 (Q2)
Covered Commercial Lives (EXPAREL)—~40M baseline post NOPAIN >40M; target ~60M YE and ~100M total lives

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Total Revenue ($M)FY 2025$725–$765 $730–$750 Narrowed
Non-GAAP Gross Margin (%)FY 202576–78 78–80 Raised
Non-GAAP R&D ($M)FY 2025$90–$105 $90–$105 Maintained
Non-GAAP SG&A ($M)FY 2025$290–$320 $290–$320 Maintained
Stock-based Comp ($M)FY 2025$56–$61 $56–$61 Maintained
Depreciation ($M)FY 2025~$30 (Q1 commentary) ~$35 (updated) Raised

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024)Previous Mentions (Q1 2025)Current Period (Q2 2025)Trend
NOPAIN reimbursement adoptionEarly indicators; J-code readiness; lagging claims data expected Encouraging early signs; ASC/community faster; IDN formulary wins beginning Survey suggests 6–12 months to implement; coverage building to >40M lives; ASC/community leading Gradual uptake building, faster in outpatient/ASC
GPO pricing & gross-to-netThird GPO expected to go live; modest net sales impact Mid-single-digit headwind offsets price increases; net effect mostly volume Low single-digit gross-to-net impact (~±1%); volume-driven growth Pricing headwind manageable; volume focus
Manufacturing efficiencies200L suite online; margin uplift San Diego 200L improved margins; RDF ruling adds low single-digit margin Decommission 45L suite; $13M annual opex savings; margin guidance raised Structural margin improvement
IP/patents & legalNew Orange Book patent; 2044 protection EXPAREL litigation settlement; exclusivity visibility to 2039; RDF royalty eliminated Favorable reexam; added patents with protection into 2041/2044; $28.3M RDF repayment Strengthened exclusivity and cash recovery
Partnerships (commercial)Pursuing ex-US partners Targeted DTC pilots; partnership interest J&J MedTech co-promotion for ZILRETTA to double sales calls; 2026 benefit reflected in outlook Expanding reach via collaboration
PCRX-201 gene therapy2-year Phase 1 data; Phase 2 planning Phase 2 ASCEND dosing underway; 3-year data at EULAR >50% Part A enrollment; interim analysis before end-2026; strong KOL excitement Advancing clinical program

Management Commentary

  • “Improving EXPAREL performance with 6% year-over-year volume growth…the highest in eight quarters” — CEO Frank Lee .
  • “Consolidated non-GAAP gross margin improved to 82%…benefit from our two large-scale manufacturing suites; we decommissioned our first-generation 45-liter suite” — CFO Shawn Cross .
  • “We currently estimate more than 40 million commercial lives now have access to EXPAREL…on track to reach 60 million…exit the year with ~100 million total covered lives” — CCO Brendan Teehan .
  • “Gross-to-net is a low single-digit impact, plus or minus 1% is reasonable” — CFO Shawn Cross .
  • “The J&J MedTech collaboration essentially doubles our sales calls for ZILRETTA and extends reach beyond orthopedics into sports medicine, pain management, and rheumatology” — CCO Brendan Teehan .

Q&A Highlights

  • ZILRETTA co-promotion economics: management did not disclose specifics but said impact is reflected in guidance and expected to be beneficial in 2026 .
  • Gross margin outlook: guidance raised to 78–80%; variability quarter-to-quarter acknowledged; continuous improvement targeted under 5x30 .
  • EXPAREL adoption gating factors: institutional reimbursement confirmation and commercial payer alignment; survey shows 6–12 months for formularies to adjust; ASC/community adopt faster .
  • Surgery volume color: outpatient case volumes slightly down YoY; EXPAREL volumes improving in HOPD/ASC settings .
  • Capital allocation: $50M repurchased in Q2; ~$250M authorization remaining; new $300M revolver; focus on accretive margin opportunities .

Estimates Context

  • Q2 2025 vs consensus: Revenue $181.1M vs ~$182.8M* (miss); Primary EPS $0.74 vs ~$0.71* (beat). Company cited EXPAREL vial mix and GPO discounting as revenue headwinds despite 6% volume growth .
  • Forward consensus indicates steady sequential improvement into Q4 driven by margin expansion and commercialization programs (J&J ZILRETTA, NOPAIN uptake) .

Q2 2025 Actuals vs Consensus

MetricQ2 2025 ActualQ2 2025 Consensus
Revenue ($M)$181.1 ~$182.8*
Primary EPS ($)$0.74 ~$0.71*

Values with asterisk (*) retrieved from S&P Global.

Forward Consensus (Wall Street)

MetricQ3 2025Q4 2025
Revenue ($M)~182.3*~200.5*
Primary EPS ($)~0.65*~0.90*

Values with asterisk (*) retrieved from S&P Global.

Key Takeaways for Investors

  • EPS beat with improved gross margin trajectory; revenue miss driven by mix/discounting suggests top line sensitivity to GPO rollout even as volume strength persists .
  • Structural margin tailwinds (200L manufacturing, RDF royalty elimination, 45L decommissioning) underpin raised FY25 non-GAAP gross margin guidance (78–80%) .
  • NOPAIN adoption and expanding commercial coverage (>40M lives, aiming ~60M by YE) point to progressive EXPAREL utilization expansion, most visible in ASC/community settings first .
  • ZILRETTA co-promotion with J&J MedTech is a notable 2026 catalyst, effectively doubling reach and increasing specialty penetration; monitor 2H25 contribution signals .
  • Cash flexibility enhanced by $300M revolver and balanced capital allocation (ongoing buybacks; ~$250M authorization remaining), supporting both growth and shareholder returns .
  • PCRX-201 advancing with >50% Part A enrollment; interim read before end-2026; continued KOL enthusiasm strengthens medium-term optionality beyond the base pain franchise .
  • Near-term trading: focus on Q3 revenue/volume cadence vs consensus and gross-margin execution; mid-term thesis hinges on NOPAIN adoption breadth, ZILRETTA co-promo ramp, and continued IP/legal durability .

Appendix: Additional Q2 2025 Disclosures

  • Operating expenses: COGS $40.9M; R&D $28.2M; SG&A $88.6M; amortization $14.3M; contingent/restructuring/other $0.6M .
  • Legal and IP: favorable patent reexamination; new Orange Book-listed patents with protection into 2041/2044; $28.3M RDF repayment received in July .
  • Share repurchase: 2.0M shares at $25.59 average ($50.0M cost) in Q2; $250M authorization remaining through 2026 .
  • Manufacturing actions: accelerated depreciation/reserve related to 45L suite; workforce optimization to support margin and yield improvements .