• Net Income (Q4 2024): $3.6 million.
• Net Revenues (Full Year 2024): $144.2 million, a 14% year-over-year increase.
• Adjusted EBITDA (Full Year 2024): $8.6 million.
• CINVANTI Net Revenues (Q4 2024): $26.9 million, up from $22.7 million in Q3.
• CINVANTI Net Revenues (Full Year 2024): Just over $100 million, up from $94.8 million in 2023.
• ZYNRELEF Net Revenues (Q4 2024): $8.5 million, a 33% increase from $6.3 million in Q3.
• Gross Margin (Full Year 2024): Improved from 49% to approximately 73%.
• Operating Expenses Reduction: Reduced by over $80 million since 2022.
• Cash Balance (End of 2024): Just over $59 million.
• SG&A Expenses (Q4 2024): $23.2 million, down from $26.8 million in Q4 2023.
• Research and Development Expenses (Q4 2024): $3.2 million, down from $7.8 million in Q4 2023.
• Net Loss (Full Year 2024): $13.6 million, improved from a net loss of $110.6 million in 2023.
• Cash and Short-term Investments (End of 2024): $59.3 million.
• Product Revenues Net Guidance (2025): $153 million to $163 million.
• Adjusted EBITDA Guidance (2025): $0 to $8 million.

• Warning! GuruFocus has detected 5 Warning Signs with HRTX.

Release Date: February 27, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Heron Therapeutics Inc (NASDAQ:HRTX) achieved profitability for both the fourth quarter and the full year 2024, with a net income of $3.6 million for the quarter.
• The company reported a 14% year-over-year increase in net revenues, reaching $144.2 million for 2024.
• ZYNRELEF achieved record net revenues of $8.5 million in Q4 2024, marking a 33% increase from Q3.
• The gross margin improved significantly from 49% in 2023 to approximately 73% in 2024.
• Heron Therapeutics Inc (NASDAQ:HRTX) successfully expanded the product labeling for ZYNRELEF, doubling the number of approved indicator procedures.

Negative Points

• Heron Therapeutics Inc (NASDAQ:HRTX) anticipates increased competition for CINVANTI, which could pressure average selling prices and impact net revenues.
• Operating expenses, although reduced, were offset by increased legal expenses related to patent litigation.
• The company experienced inventory write-offs of $2.5 million and impairment write-offs of $2.2 million for projects no longer part of its forward-looking strategy.
• Despite achieving profitability in Q4, Heron Therapeutics Inc (NASDAQ:HRTX) reported a net loss of $13.6 million for the full year 2024.
• The company expects some lumpiness in cash flow due to legal expenses and potential fluctuations in CINVANTI's market performance.

Q & A Highlights

Q: Can you provide insights into ZYNRELEF's performance in Q4 and expectations for 2025? A: Craig Collard, CEO, explained that there was no significant stocking in Q4, and inventories remained low. The VAN launch in mid-December had minimal impact, but the reception has been positive. They have regained or saved 15 accounts due to the VAN launch. The company anticipates strong growth in 2025, driven by the NOPAIN Act, crosslink partnership, and expanded labeling.

Q: How should we think about cash flow and adjusted EBITDA for 2025? A: Ira Duarte, CFO, noted that cash flow might be lumpy due to legal expenses and PFS. However, overall results and spending will not change significantly from 2024. Craig Collard added that they are tracking close to last year's performance for CINVANTI, with some anticipated competition and ASP pressure later in the year.

Q: What is driving the momentum for ZYNRELEF, and what impact will the NOPAIN Act have? A: Craig Collard highlighted that the momentum is driven by the crosslink partnership and the upcoming full reimbursement under the NOPAIN Act starting April 1st. The act's emphasis on non-opioid alternatives is expected to benefit ZYNRELEF and similar products.

Q: Can you discuss the impact of crosslink reps on ZYNRELEF sales and expectations for 2025? A: Craig Collard stated that approximately 800 crosslink reps are now trained, and accounts with crosslink overlap are growing 30% faster. The full impact of the VAN and crosslink reps is expected to be seen mid-year, with significant growth anticipated as the 200 mg VAN launches and the NOPAIN Act takes effect.

Q: What is the status of the pre-filled syringe for ZYNRELEF? A: William Forbes, Chief Development Officer, mentioned that they are pleased with the stability of a demo batch and are aiming for a market launch between late 2026 and the first half of 2027.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.