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Pacira BioSciences, Inc. (NASDAQ:PCRX) presented its second-quarter 2025 earnings on August 5, highlighting improved financial performance, strategic advancements, and progress on its "5x30" growth strategy. The company’s shares rose 3.53% in aftermarket trading following the presentation, signaling positive investor reception after a challenging first quarter.
Quarterly Performance Highlights
Pacira reported total revenue of $181 million for Q2 2025, representing a significant improvement from the $164.9 million reported in Q1. The company’s flagship product EXPAREL generated $143 million, while ZILRETTA and iovera° contributed $31 million and $6 million, respectively. Notably, ZILRETTA sales showed substantial recovery from the $23.3 million reported in the previous quarter.
The company achieved its highest year-over-year volume growth in eight quarters at 6%, while non-GAAP gross margins reached an impressive 82%, exceeding previous guidance. This performance prompted management to raise its full-year gross margin guidance from 76-78% to 78-80%.
As shown in the following chart of quarterly achievements:
"We’re seeing accelerating momentum across our business as our strategic initiatives take hold," said Frank Lee, CEO of Pacira BioSciences, during the earnings call. "The enhanced gross margins reflect our operational efficiency improvements and favorable product mix."
Strategic Initiatives and Market Expansion
Pacira’s "5x30" strategy, introduced earlier this year, continues to guide the company’s growth trajectory. This comprehensive approach focuses on five key pillars: expanding patient reach to more than 3 million annually, achieving double-digit revenue growth, improving gross margins, advancing the clinical pipeline, and establishing strategic partnerships.
The strategy is illustrated in this overview:
Market access remains a critical focus area, with Pacira expecting approximately 100 million total covered lives across commercial and government payers by year-end. The company reported that over 40 million commercial lives already have access to EXPAREL via separate reimbursement as of Q2 2025, with strategic prioritization in the top five states that account for approximately 40% of EXPAREL procedural volumes.
The commercial coverage expansion is detailed in the following slide:
Pacira also highlighted faster adoption of its products in community hospitals and ambulatory surgical centers (ASCs) compared to academic medical centers, noting that decision-making is more streamlined in these settings. However, the company reported improving growth across all segments, including a return to growth in the academic segment.
Pipeline and Partnership Developments
A significant development in Q2 was Pacira’s collaboration with Johnson & Johnson (NYSE:JNJ) MedTech, which is expected to substantially expand the reach of ZILRETTA. This partnership will potentially double current sales calls and provide access to J&J’s established team and extensive customer base across various physician specialties.
The details of this strategic partnership are outlined here:
On the pipeline front, Pacira continues to advance PCRX-201, which management describes as having "the potential to revolutionize the OA treatment landscape." The company reported that the Phase 2 ASCEND Part A study has surpassed 50% enrollment, with earlier data showing that a single intra-articular injection was well-tolerated with sustained efficacy through three years.
Additionally, the company is progressing with ZILRETTA and iovera° label expansion studies, which are proceeding according to plan. A real-world registry in knee osteoarthritis has enrolled more than 2,500 patients to date.
Financial Outlook and Capital Allocation
Pacira provided full-year 2025 financial guidance, projecting total revenue between $730-750 million, non-GAAP gross margins of 78-80%, and adjusted EBITDA of $54 million. The company ended Q2 with approximately $270 million in cash and investments.
The comprehensive financial summary and guidance is presented here:
The company also enhanced its capital structure during the quarter by securing a new $300 million five-year revolving credit facility, which was used to fully repay its Term Loan A. This restructuring is expected to generate annualized interest savings of 60 basis points beginning in 2026 with no amortization requirements.
Pacira continues to return capital to shareholders through its share repurchase program, having bought back approximately 2 million shares of common stock for $50 million during the quarter. The company has $250 million remaining in its current authorization and has reduced total shares outstanding to approximately 45 million.
Intellectual Property and Regulatory Environment
Pacira reported significant progress in strengthening its patent portfolio, which now includes 20 patents listed in the FDA’s Orange Book. Recent developments include favorable reexamination of the ’495 patent and two new patents that extend exclusivity into 2040 and beyond.
The company also highlighted potential tailwinds from the Centers for Medicare & Medicaid Services (CMS) 2026 preliminary rule, which proposes a complete phase-out of the inpatient-only list over the next three years. This regulatory change could enhance EXPAREL’s market opportunity in outpatient settings, beginning with the removal of hundreds of procedures in 2026.
Conclusion
Pacira’s Q2 2025 presentation demonstrates a significant recovery from its challenging first quarter, with improved financial performance across key metrics and progress on strategic initiatives. The combination of accelerating revenue growth, expanded gross margins, enhanced capital structure, and advancing pipeline positions the company favorably for continued execution of its "5x30" strategy.
While challenges remain in achieving broader market adoption, particularly in academic medical centers, the company’s strategic partnerships, patent portfolio expansion, and improving reimbursement landscape provide multiple potential growth catalysts. Investors will be watching closely to see if Pacira can maintain this momentum through the second half of 2025 and deliver on its updated financial guidance.
Full presentation:
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