Executive Summary

UPNEEQ net product sales grew 19% sequentially to $10.0M in Q3 2022, up 355% YoY; total revenues were $10.0M as licensing revenue did not recur this quarter .
Gross margin improved to 75% (from 74% in Q2 and 48% in Q3 2021) on higher sales volume; SG&A fell YoY on lower share-based comp and professional fees .
Guidance was cut: RVL revised Q4 2022 UPNEEQ net sales to $12–$14M (from prior $20–$25M), citing momentum in medical aesthetics but resetting expectations; this was reaffirmed Nov 10 .
Liquidity strengthened via August financing ($43.9M gross) with Q3 cash at $59.8M; debt principal totaled $75.0M (measured at fair value on balance sheet as $55.9M) .

What Went Well and What Went Wrong

What Went Well

UPNEEQ adoption accelerated: net product sales +19% QoQ to $10.0M; ~3,500 cumulative medical aesthetics practices ordered (+59% QoQ); ~17,000 cumulative pharmacy-paid prescribers (+13% QoQ) .
Margin and efficiency improved: gross margin rose to 75%; SG&A fell YoY to $20.4M driven by lower share-based comp and professional fees .
Management confidence in category creation: “UPNEEQ continues to gain traction…19% sequential-quarter increase…we look forward to capturing the full value of what we believe is a significant opportunity” – CEO Brian Markison .

What Went Wrong

Guidance reset: Q4 UPNEEQ net sales guided down to $12–$14M from $20–$25M earlier in the year, indicating a slower ramp than initially envisioned .
Continued operating losses: Q3 operating loss of $(13.9)M; Adjusted EBITDA loss of $(10.9)M despite YoY improvement, reflecting scale-up costs and non-cash items .
Cost of goods sold increased YoY (+$1.4M) due to higher product costs and royalties/milestones tied to sales, partially offsetting margin gains .

Financial Results

Metric	Q1 2022	Q2 2022	Q3 2022
Total Revenues ($USD Thousands)	$21,444	$8,448	$10,022
Net Product Sales ($USD Thousands)	$5,944	$8,448	$10,022
Gross Profit Margin %	90%	74%	75%
SG&A ($USD Thousands)	$23,834	$20,169	$20,375
R&D ($USD Thousands)	$862	$1,176	$1,044
Operating Loss ($USD Thousands)	$(5,396)	$(15,124)	$(13,922)
Diluted EPS – Continuing Ops ($USD)	$(0.08)	$(0.14)	$(0.16)

YoY comparison for Q3:

Metric	Q3 2021	Q3 2022
Total Revenues ($USD Thousands)	$2,196	$10,022
Net Product Sales ($USD Thousands)	$2,196	$10,022
Gross Profit Margin %	48%	75%
SG&A ($USD Thousands)	$24,841	$20,375
R&D ($USD Thousands)	$1,376	$1,044
Adjusted EBITDA ($USD Thousands)	$(20,323)	$(10,914)
Diluted EPS – Continuing Ops ($USD)	$(0.42)	$(0.16)

Segment/non-product revenue breakdown:

Revenue Component ($USD Thousands)	Q1 2022	Q2 2022	Q3 2022
Net Product Sales	$5,944	$8,448	$10,022
Licensing Revenue	$15,500	$0	$0

KPIs:

KPI	Q1 2022	Q2 2022	Q3 2022
Cumulative pharmacy-paid prescribers	~12,900	~15,000	~17,000
Cumulative medical aesthetics practices ordering	~1,100	~2,200	~3,500
Medical aesthetics practices reordering	“meaningful” (no count disclosed)	>500 practices	~1,000 practices
Eyecare prescriber base split (Optometry/Ophthalmology)	66%/34%	67%/33%	68%/32%

Balance sheet/liquidity snapshot (Q3 2022):

Cash and cash equivalents: $59.8M; debt and financing obligations aggregate principal $75.0M (fair value carrying $55.9M); warrants liability $8.9M .
August 8 financing: $23.9M gross equity; $20.0M second tranche notes; up to $25.0M potential third tranche (subject to minimum revenue target) .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
UPNEEQ Net Product Sales	Q4 2022	$20–$25M (reaffirmed in Q1 & Q2)	$12–$14M (revised Oct 18; reaffirmed Nov 10)	Lowered

Notes: Management plans to launch a new eCommerce platform in Q1 2023 (operational initiative, not numeric guidance) .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 & Q2)	Current Period (Q3 2022)	Trend
Medical aesthetics adoption	~1,100 practices ordering by Q1; doubled to ~2,200 by Q2; >500 reorders by Q2	~3,500 practices ordering (+59% QoQ); ~1,000 reorders	Increasing sequentially (2,200→3,500 practices)
Salesforce expansion	Planned significant expansion by mid/late July	Expanded medical aesthetics salesforce in place since late July	Implemented; supporting growth
Guidance trajectory	Q4 net sales reaffirmed at $20–$25M	Q4 net sales revised to $12–$14M; reaffirmed	Lowered vs prior
Liquidity/financing	Cash $26.3M Q1; plan benefited from Santen cash receipt; reiterated runway potential	August financing raised $43.9M; Q3 cash $59.8M	Strengthened
Commerce/technology enablement	Not mentioned	New eCommerce platform planned for Q1 2023	New initiative

Note: No earnings call transcript was available via our sources; call logistics were disclosed (Nov 10, 4:30 p.m. ET), but transcript access could not be retrieved .

Management Commentary

“UPNEEQ continues to gain traction within the eyecare and medical aesthetics markets, as demonstrated by the 19% sequential-quarter increase in net product sales in the third quarter.” – Brian Markison, CEO .
“We believe that we are well positioned to achieve 20% to 40% quarterly sequential net product sales growth in the fourth quarter of 2022.” – Brian Markison (Oct 18 preliminary release) .
“Establishing UPNEEQ as a daily part of the non-invasive facial aesthetic practice remains our number one priority.” – JD Schaub, COO (Q2 release) .
“With a strong first quarter…we have confidence in our growth plans.” – Brian Markison (Q1 release) .

Q&A Highlights

An earnings call was scheduled for Nov 10, 2022, but a full transcript was not accessible via our document search; therefore, Q&A themes and management responses cannot be summarized from primary sources .

Estimates Context

S&P Global Wall Street consensus estimates for RVLPQ were unavailable in our data retrieval, so we cannot provide vs-consensus comparisons for Q3 2022 or Q4 guidance. We attempted to fetch “Primary EPS Consensus Mean” and “Revenue Consensus Mean” for Q3 2022, but the data was not available for this ticker in our mapping.

Key Takeaways for Investors

Sequential growth but reset expectations: UPNEEQ net sales rose to $10.0M in Q3 (+19% QoQ), yet Q4 guidance was lowered to $12–$14M vs prior $20–$25M, implying a slower near-term ramp; watch for trajectory into 2023 .
Adoption momentum remains a structural positive: medical aesthetics practices ordering increased to ~3,500 (+59% QoQ), with ~1,000 reorders – key leading indicators for recurring demand .
Margin and cost profile improved YoY: gross margin 75% and SG&A down YoY support operating leverage as scale builds; monitor COGS drivers (royalties/milestones) and marketing investments .
Liquidity strengthened, reducing financing risk: $59.8M cash and August capital raise provide flexibility to invest in growth and bridge to scale; debt carried at fair value $55.9M vs $75.0M principal .
Non-GAAP progress: Adjusted EBITDA loss improved substantially YoY (Q3 $(10.9)M vs $(20.3)M), reflecting scale and non-cash fair value items; track continued improvement as revenue scales .
2023 catalysts: planned eCommerce platform launch in Q1 2023 may enhance channel conversion and reorder rates; execution will be critical to re-accelerate growth after guidance reset .
Estimate dynamics: With consensus unavailable here and a guidance cut, Street models likely require downward revisions; focus on sequential performance, reorder velocity, and salesforce productivity to gauge near-term inflection .

RVL Pharmaceuticals plc (RVLPQ)·Q3 2022 Earnings Summary