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Iterum Therapeutics PLC (NASDAQ:ITRM) reported its fourth-quarter 2024 financial results, revealing a narrower-than-expected loss. The company posted an actual EPS of -0.12, beating the forecasted EPS of -0.22. This positive surprise prompted a pre-market stock price increase of 4.7%, with shares trading at $1.56. According to InvestingPro analysis, ITRM is currently undervalued, though investors should note the company’s "FAIR" overall financial health rating. The company continues to focus on strategic initiatives following the FDA approval of Orlynypa, its new oral antibiotic.
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Key Takeaways
- Iterum reported a smaller-than-expected EPS loss, beating forecasts by 10 cents.
- Pre-market trading saw the stock rise by 4.7% following the earnings announcement.
- FDA approval of Orlynypa positions Iterum uniquely in the UTI treatment market.
Company Performance
Iterum Therapeutics has made significant strides in the past year, culminating in the FDA approval of Orlynypa, the first oral penum approved in the U.S. for uncomplicated urinary tract infections. This achievement is part of their broader strategy to capture a share of the 40 million prescriptions written annually in this market. The company reported a net loss of $6.6 million on a GAAP basis for Q4, a reduction from previous periods, reflecting improved cost management.
Financial Highlights
- Total (EPA:TTEF) operating expenses for Q4 2024 were $3.7 million, down from $11.4 million in Q4 2023.
- R&D expenses totaled $1.3 million in Q4 2024.
- Cash and cash equivalents stood at $24.1 million as of December 2024.
Earnings vs. Forecast
Iterum’s actual EPS of -0.12 was a significant improvement over the forecasted -0.22, marking a positive surprise of approximately 45%. This result reflects the company’s effective cost management and strategic focus, contrasting with previous quarters where forecasts were missed.
Market Reaction
Following the earnings release, Iterum’s stock rose by 4.7% in pre-market trading, reaching $1.56. This increase comes despite a recent decline of 5.1% in regular trading, where the stock closed at $1.49. InvestingPro data reveals significant price volatility, with a beta of 2.27 and a substantial 35.45% price return over the past six months, despite a -15.82% YTD return. The current price remains within its 52-week range of $0.81 to $3.02, suggesting a cautious but optimistic investor sentiment.
Outlook & Guidance
Looking forward, Iterum is concentrating on maximizing the value of Orlynypa through potential partnerships and commercialization strategies. The company is also considering capital raising options to support direct commercialization efforts. While analyst consensus maintains a neutral stance, InvestingPro data shows significant upside potential, with analyst price targets ranging from $5 to $10. Revenue forecasts for the upcoming quarters indicate gradual growth, with a projected increase in revenue to $2.04 million by Q4 2025.
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Executive Commentary
CEO Corey Fishman highlighted the strategic importance of Orlynypa, stating, "Orlynypa is the first and only approved oral penum in the United States." He also emphasized the untapped potential of the UTI market, noting, "We believe the uncomplicated urinary tract infection market is underserved."
Risks and Challenges
- Market competition and resistance rates: Existing UTI treatments show resistance rates up to 30%, posing a challenge for market entry.
- Financial sustainability: Continued operations depend on successful commercialization or strategic partnerships.
- Regulatory hurdles: Future product launches may face stringent regulatory requirements.
Q&A
During the earnings call, analysts inquired about Iterum’s strategic partnerships and commercialization plans for Orlynypa. The company confirmed ongoing discussions with pharmaceutical companies and financial investors, as well as research efforts with healthcare payers and physicians to optimize market entry strategies.
Full transcript - Iterum Therapeutics PLC (ITRM) Q4 2024:
Ezra, Call Coordinator: Hello, everyone, and welcome to the ITERM Therapeutics plc Fourth Quarter and Full Year twenty twenty four Financial Results. My name is Ezra and I will be your coordinator today. I will now hand you over to Louise Barrett, Senior Vice President, Legal Affairs to begin. Louise, please go ahead.
Louise Barrett, Senior Vice President, Legal Affairs, ITERM Therapeutics: Thank you, Idra. Good morning and welcome to Idra Therapeutics’ fourth quarter and full year twenty twenty four financial results and business update conference call. A press release with our fourth quarter and full year results was issued earlier this morning and can be found on our Web site. We are joined this morning by our Chief Executive Officer, Corey Fishman and Chief Financial Officer, Judy Matthews. Corey will provide some opening remarks.
Judy will provide details on our financial results and then we’ll open the lines to Q and A. Before we begin, I’d like to remind you that some of the information presented on this conference call will contain forward looking statements concerning our plans, strategies and prospects for our business, including the development, therapeutic and market potential of our LINDA, the sufficiency of our cash resources to fund operating expenses into the second half of twenty twenty five, our strategic process to sell, license or otherwise dispose of our rights to our LINDA, our ability to complete pre commercialization activities for our LINDA, our ability to develop a commercial launch plan either directly or with a commercial partner if we are unsuccessful in entering into or completing a strategic transaction and the expected issuance of patents and the term and coverage provided by such patents on issue. Actual results may differ materially from those indicated by these forward looking statements as a result of various factors outside of our control, including but not limited to risks and uncertainties concerning the outcome impact effects and results of our evaluation of strategic alternatives, including the terms, timing, structure, value, benefits, and costs of any strategic alternatives, our ability to complete a strategic alternative transaction, our ability to raise sufficient capital and successfully prepare and implement commercialization plans for Alinda with a commercial partner or directly if we were unsuccessful in entering into or completing a strategic transaction, the market opportunity for and the potential market acceptance of our LINDA, our ability to continue with the going concern, the accuracy of our expectations regarding how far into the future are cash and handle under our ongoing operations and other factors discussed under the caption risk factors in the annual report filed with the SEC this morning and other documents filed with the SEC from time to time.
In addition, any looking statements represent only our views as of the date of this call and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update such statements. We will also be referencing non GAAP financial measures during the call. We’ve provided reconciliations of GAAP reported to non GAAP adjusted information in the press release issued this morning. Now with that all said, I’ll turn it over to you, Corey, for your opening remarks.
Corey Fishman, Chief Executive Officer, ITERM Therapeutics: Thanks, Louise. Welcome and thanks for joining us today. I’d like to provide a brief recap of twenty twenty four and talk a bit about key activities and milestones in 2025. Overall, 2024 was a very good year for ITERIM. In January, we generated positive results in our pivotal Phase III REEASURE clinical trial comparing oral sulpenem to Augmentin in adult women with uncomplicated urinary tract infections, efficiently pulled together our NDA resubmission which was submitted in April.
In September, we had a successful advisory committee meeting. And in October of twenty twenty four, received FDA approval for Orlynypa, the brand name for our oral sulpenem bilayer product. Orlynypa is indicated for the treatment of uncomplicated urinary tract infections caused by the designated microorganisms E. Coli, klebsiella pneumoniae or Proteus mirabilis in adult women who have limited or no alternative oral antibacterial treatment options. Orlymba is the first and only approved oral penum in The United States.
Now, I’ll share a few comments with you as to why we are so excited about the potential for Orlymba in the market. The uncomplicated urinary tract infection market in The U. S. Is quite large and generates an estimated 40,000,000 prescriptions annually. Olinda is the first and only oral penum approved in The United States and the second FDA approved treatment for uncomplicated urinary tract infections in the past two decades.
ORLYNDA will potentially be the first branded product to enter the uncomplicated urinary tract infection market in over twenty five years. The leading product in the uncomplicated urinary tract infection market nitrofurantoin was approved in 1953. And the majority of the other oral products in the market were approved in the 1970s and 1980s. The extensive use of these products over time has led to rising resistance rates resulting in the most widely used products having resistance rates approaching 20. And those rates can run as high as thirty percent.
As most prescribing for uncomplicated urinary tract infections occurs empirically, increasing resistance rates creates a challenge for practicing physicians since the efficacy of these products are continuing to be eroded over time. Additionally, almost all of the widely used oral products in this therapy area have some safety concerns that again create challenges for treating physicians as to their choice of agent to use. Unfortunately, with almost no innovation in decades, physicians have been forced to use agents that may not work as well as they would like for their patients. With the Orlynda approval, there now could be an alternative treatment option for those patients who have limited or no other oral treatment options available. We believe that there are many patients that fall into this category, specifically elevated risk patients.
We define elevated risk patients as women that fall into any of the following categories. Women who are 65 years or older, women who have diabetes, women with a history of recurrent or drug resistant infections, or women that have other comorbidities that negatively impact their immune systems. This group of patients are most at risk given their profiles. And many physicians are challenged to treat these patients with existing oral options that have substantial resistance as well as safety hurdles. Another key group of patients in this therapy area that are in significant need of a new efficacious and safe oral treatment alternative are the patients that have pathogens resistant to all commonly used oral antibiotics.
In our REEOSURE uncomplicated urinary tract infection clinical trial, pleaded last year and conducted exclusively in The U. S. Across almost 1,000 patients, we found that approximately one percent of these patients had an isolate that was resistant to all available oral antibiotics. OrlymVA could play an important role in treating these patients as well. As we look at protection for Orlymba with the formal confirmation from the FDA of five additional years of marketing exclusivity under the GAIN Act, Orlynda has market exclusivity for a total of ten years from the date of approval or until 10/25/2034.
Additionally, our U. S. Patent portfolio provides protection for Orlynda into 02/1939 with issued U. S. Patents covering both method of use and composition of matter.
We have submitted patent information for four U. S. Patents for Olynyba that are listed in FDA’s Orange Book, approved drug products with therapeutic equivalent evaluations. Overall, we’re very pleased with the amount of protection that Olimba should have in The U. S.
Market to capture value without competition from a potential generic product. In addition to the in license and issued patents we have, there are a number of pending patent applications in The U. S. And other jurisdictions including Europe and China. As we enter 2025, there are a few items to note.
Our key priority remains the previously announced strategic process to sell, license or otherwise dispose of our rights to Orlymba with the goal of maximizing value for our stakeholders. Along with our financial advisor, we have conducted outreach to dozens of companies since our approval and have and will continue to engage with those that are potentially interested in a strategic transaction. As neither ITERIM nor our financial advisor appointed to assist the board in evaluating various strategic alternatives is in control of whether our efforts on the strategic front will result in any definitive offer to consummate such a transaction or if we do receive a definitive offer, whether the terms are as favorable as anticipated or acceptable to the board. In parallel to the strategic process, we have begun to evaluate other options for maximizing the value of Orlynypa, which may include seeking to raise capital to support the commercialization of Orlynypa. We plan to engage in pre commercial activities in order to develop the foundation for a highly targeted launch of ORLYNZA with a commercial partner or directly subject to raising sufficient capital to ensure that the product is made available to patients and physicians as soon as possible.
On the financial side, we have repaid the principal and interest due under our exchangeable notes at the January in accordance with their terms. Additionally, based on our current operating plan, including currently planned pre commercialization activities, we expect our cash will be sufficient to fund operations into the second half of twenty twenty five. Now I’ll turn the call over to Judy Matthews, our CFO for a financial update.
Judy Matthews, Chief Financial Officer, ITERM Therapeutics: Thanks, Corey. Total operating expenses were $3,700,000 in the fourth quarter and $18,700,000 for the full year 2024 compared to $11,400,000 and $47,500,000 in the fourth quarter and full year 2023. Our operating expenses include cost of sales, which is primarily the amortization of an intangible asset, research and development expenses and general and administrative expenses. R and D costs were $1,300,000 for the fourth quarter and $10,500,000 for the full year 2024 compared to $9,700,000 and $40,000,000 for the same periods in 2023. The primary driver of the decrease in R and D expense for the fourth quarter and full year was the completion of the REASSURE trial.
G and A costs were 2,100,000.0 for the fourth quarter and $8,000,000 for the full year 2024 compared to G and A costs of $1,700,000 and $7,500,000 for the same period in 2023. The primary driver of the increase in G and A expense for the fourth quarter and full year was higher legal fees. Our net loss on a US GAAP basis was $6,600,000 for the fourth quarter of twenty twenty four and $4.824800000.0 for the full year. On a non GAAP basis, which excludes certain non cash adjustments, our net loss of $3,100,000 and 17,600,000.0 for the fourth quarter and full year 2024 compared to our non GAAP net loss of $10,700,000 and $43,800,000 for the fourth quarter and full year 2023. The $7,600,000 and $26,200,000 decrease in our non GAAP net loss for the fourth quarter and full year was primarily a result of lower R and D expenses related to our REIT trial.
At the December, we had cash and cash equivalents of $24,100,000 Based on our current operating plan, which includes our currently planned pre commercialization spend, we expect that our cash and cash equivalents, including $4,800,000 of net proceeds raised under our ATM from January 1 through 02/06/2025, will be sufficient to fund our operations into the second half of twenty twenty five. Pursuant to our exclusive license with Pfizer (NYSE:PFE) for sulpenem, we were obligated to make a regulatory milestone payment of $20,000,000 to Pfizer upon approval of oral psilocapenem. In accordance with the license, we elected to defer payment for two years and delivered a promissory note to Pfizer in the amount of $20,000,000 in October 2024. This note accrues interest at an annual rate of 8% on a daily compounded basis until paid in full. On 01/31/2025, we repaid the outstanding principal and interest due under the exchangeable notes in accordance with their terms.
As of 02/06/2025, we had approximately 34,600,000.0 ordinary shares outstanding. We will now open it up for questions.
Ezra, Call Coordinator: Our first question comes from Ed Arka with H. C. Rangratz. Ed, your line is now open. Please go ahead.
Thomas, Analyst, H.C. Rangratz: Hello. Good morning, everyone. This is Thomas here asking a couple of questions for Ed. Thank you so much for taking our questions. Perhaps first question, wonder if you can discuss any feedback or details on your ongoing discussions with potential partners and also if you can discuss what type of entities are you having discussions with such as pharma companies or financial organizations, What type of partners are you seeking out currently?
Corey Fishman, Chief Executive Officer, ITERM Therapeutics: Thanks for the question, Thomas. As you’d imagine, we really can’t talk in detail about any ongoing conversations. What I will say is, as I mentioned is, we have had outreach to dozens of companies, which include both pharma companies as well as financial investors and that process is ongoing.
Thomas, Analyst, H.C. Rangratz: Understood. And then on the other side, you mentioned that their for commercial preparations ongoing. I wonder if you can highlight some activities on that front?
Corey Fishman, Chief Executive Officer, ITERM Therapeutics: Yes. So we are currently engaging in some research with payers, with physicians. We’re also doing some analytics around targeting, around geographies, all in the instead of putting the foundation in place, should we end up in a place where the strategic transaction does not occur or the strategic transaction doesn’t generate something that is sufficient in the board’s eyes, for a commercial launch either by us or with a commercial partner here at Iditarum.
Thomas, Analyst, H.C. Rangratz: Understood. That’s all the questions left for now. Thank you so much for taking the questions and looking forward to progress in ongoing discussions.
Corey Fishman, Chief Executive Officer, ITERM Therapeutics: Thanks, Thomas.
Ezra, Call Coordinator: Thank you very much. We currently have no more questions. I will hand back over to Corey Fishman for any closing remarks.
Corey Fishman, Chief Executive Officer, ITERM Therapeutics: Thank you. We appreciate you joining us today. 2024 was a pivotal year for ITERRA as we received our FDA approval for Olenba, the first and only oral panel approved in The U. S. We believe the uncomplicated urinary tract infection market is underserved and that there is a substantial unmet need for effective treatment options.
We look forward to Orlymba entering The U. S. Market and ensuring that Orlymbe is made available to patients and physicians in order to provide this important treatment option to treat uncomplicated urinary tract infections. Thanks again and have a good day.
Ezra, Call Coordinator: Thank you very much, Corey, and thank you all our speakers on today’s call. This concludes today’s conference call. You may now disconnect your lines.
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