• Total Product Sales: $30.7 million in Q2 2024, down from $31.9 million in Q1 2024.

• ROLVEDON Sales: $15.1 million in Q2 2024, up from $14.5 million in Q1 2024.

• INDOCIN Sales: $6.9 million in Q2 2024, down from $8.7 million in Q1 2024.

• Gross Margin: 71% in Q2 2024, compared to 65% in Q1 2024.

• SG&A Expense: $18.4 million in Q2 2024, slightly down from $18.5 million in Q1 2024.

• Adjusted EBITDA: $5 million in Q2 2024, compared to $7.4 million in Q1 2024.

• Cash Flow from Operations: $7.4 million in Q2 2024.

• Cash and Short-term Investments: $88.4 million at the end of Q2 2024, up from $80.7 million at the end of Q1 2024.

• Debt: Unchanged at $40 million.

• 2024 Guidance: Net product sales of $110 million to $125 million; adjusted EBITDA of $20 million to $30 million.

• Warning! GuruFocus has detected 6 Warning Signs with ASRT.

Release Date: August 07, 2024

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

Positive Points

• ROLVEDON sales increased for the sixth consecutive quarter, indicating strong demand and positive reception from physicians and patients.

• Assertio Holdings Inc (NASDAQ:ASRT) generated $7.4 million in cash, increasing total cash to over $88 million, providing a strong financial position for future acquisitions.

• The company successfully completed enrollment for ROLVEDON's same-day dosing trial, with data expected to be presented at a major medical conference later this year.

• Assertio Holdings Inc (NASDAQ:ASRT) maintained a solid balance sheet with modest debt on favorable terms, positioning the company well for growth.

• The company is actively seeking new assets to add to its portfolio, leveraging its strong cash position and commercial model to drive future growth.

Negative Points

• Total product sales decreased slightly from $31.9 million in the first quarter to $30.7 million in the second quarter, primarily due to the decline in INDOCIN sales.

• INDOCIN sales were impacted by generic competition, resulting in a decrease from $8.7 million in the first quarter to $6.9 million in the second quarter.

• The company experienced an increase in inventory write-downs for late-stage products, impacting gross margins.

• Adjusted EBITDA decreased from $7.4 million in the first quarter to $5 million in the second quarter, reflecting lower product sales and increased inventory write-down expenses.

• The company faces uncertainty regarding the number of generic competitors for INDOCIN, which could impact future sales and market share.

Q & A Highlights

Q: Brendan, what excited you about joining Assertio, and what have you learned in your first months? A: Brendan O'Grady, CEO: After 71 days, it's exactly what I expected. Assertio offers a great opportunity to create value with a solid balance sheet, strong commercial model, and promising assets like ROLVEDON. The business development landscape is heating up, and I'm excited about the growth potential.

Q: How are you thinking about modifying guidance given your current product sales? A: Brendan O'Grady, CEO: We'll reassess guidance in November after completing nine months of the year. I'm still getting a handle on everything, but we'll evaluate our position and update guidance accordingly.

Q: What are your expectations for generic competitors to INDOCIN by year-end? A: Brendan O'Grady, CEO: We expected another generic competitor in July, but it hasn't launched. We initially thought there might be two or three by year-end, but we might only see one. Our plan was for multiple, so there could be potential upside.

Q: What is your strategy for acquiring additional products? A: Brendan O'Grady, CEO: We're looking for assets that fit our commercial model, are cash accretive, and have patent protection. We aim for assets that don't require a large salesforce but align with our core competencies.

Q: How do you view ROLVEDON's growth prospects for 2025? A: Brendan O'Grady, CEO: We are bullish on ROLVEDON and expect it to be a growth asset for the foreseeable future. We anticipate continued growth next year, balancing volume growth with ASP erosion.

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

This article first appeared on GuruFocus.