DexCom earnings beat by $0.03, revenue topped estimates
Medicure Inc. reported its financial results for the fourth quarter of 2024, showing a slight increase in revenue to $21.9 million, up from $21.7 million in the previous year. The company posted a net loss of $1 million, or $0.10 per share, compared to a loss of $922,000, or $0.09 per share, in the same period last year. With a market capitalization of just $6.26 million, InvestingPro analysis indicates the stock is currently trading below its Fair Value. The stock remained stable in the immediate aftermath of the report, reflecting a neutral market reaction.
Key Takeaways
- Revenue increased marginally to $21.9 million from $21.7 million year-over-year.
- Net loss widened slightly to $1 million, or $0.10 per share.
- Cash position improved to $7.2 million as of December 31, 2024.
- ZYPITAMAG sales through Marley Drug grew by 23%.
- The company is focusing on expanding its pharmacy distribution network.
Company Performance
Medicure Inc.’s performance in Q4 2024 showed mixed results, with a minor increase in revenue but a slightly larger net loss compared to the previous year. Despite the challenges, the company maintains a strong gross profit margin of 59.75% and a healthy current ratio of 1.89. The company’s strategic focus on expanding its pharmacy business and improving product sales, particularly ZYPITAMAG, contributed to revenue growth. According to InvestingPro data, which offers detailed insights through its comprehensive Pro Research Reports covering over 1,400 stocks, the company maintains more cash than debt on its balance sheet, demonstrating financial prudence despite current profitability challenges.
Financial Highlights
- Revenue: $21.9 million, a slight increase from $21.7 million in 2023.
- Net Loss: $1 million, or $0.10 per share, compared to $922,000, or $0.09 per share, in 2023.
- Cash Position: $7.2 million as of December 31, 2024, up from $6.4 million in 2023.
- Adjusted EBITDA: Negative $437,000, down from positive $1.9 million in 2023.
Outlook & Guidance
Medicure is focused on several strategic initiatives for the future, including growing ZYPITAMAG sales, expanding its pharmacy business, and maintaining AGGRASTAT sales. The company is also committed to developing MC1 for FDA approval and investing in new chemical entities. Expected R&D expenses are around $3 million in 2025, with continued legal expenses anticipated.
Executive Commentary
Dr. Albert Friesen, CEO, emphasized the company’s long-term goals: "Our goal is to continue to build this business with a stable long-term outlook to generate value for our shareholders." Dr. Neil Owens, President and COO, highlighted the company’s marketing strategy: "We continue to use a field-based sales team as well as prescriber and consumer marketing."
Risks and Challenges
- Pricing Pressures: Ongoing competition from generic products affects AGGRASTAT pricing.
- Insurance Reimbursement: Challenges with coverage and reimbursement could impact revenue.
- Product Mix Changes: Shifts in pharmacy product offerings may affect sales margins.
- Regulatory Hurdles: Developing MC1 for FDA approval involves regulatory risks.
- Market Competition: The company faces competition in the rare pediatric disease market.
Q&A
During the earnings call, analysts inquired about the timeline for the MC1 trial, which is expected to be a 12-month study. There were also questions regarding the synergies from recent pharmacy acquisitions and the anticipated benefits of these expansions.
Medicure Inc. remains focused on its strategic goals, despite facing several industry challenges. The company aims to leverage its strengths in pharmacy distribution and product innovation to drive future growth.
Full transcript - Medicure Inc (MPH) Q4 2024:
Holly, Conference Call Operator: Welcome to Medicure’s earnings conference call for the quarter and year ended 12/31/2024. My name is Holly, and I will be your operator for today’s call. At this time, all participants are in listen only mode. Before we proceed, I would like to remind everyone that this presentation contains forward looking statements relating to future results, events, and expectations, which are made pursuant to the Safe Harbor provisions of The U. S.
Securities Litigation Reform Act of 1995. Forward looking statements involve known and unknown risks and uncertainties, which could cause the company’s actual results to differ materially from those in the forward looking statements. Such risks and uncertainties include, among others, those described in the company’s most recent annual information form and Form 20 F. Later, we will conduct a question and answer session. Please note that this conference call is being recorded, and today’s date is 04/29/2025.
I would now like to turn the conference call over to doctor Albert chief executive officer of Medicure Inc. Please go ahead, doctor Friesen.
Dr. Albert Friesen, Chief Executive Officer, Medicure Inc.: Thank you, Holly, and good morning to all on the call. We appreciate your interest and participation in today’s call. Joining me today in the 2024 financial statements is Doctor. Neil Owens, President and Chief Operating Officer and Hara Sutin, Medicure’s Chief Financial Officer. The net revenue for 2024 was $21,900,000 slight increase from the previous year, which was $21,700,000 The company recorded a net loss for 2024 of approximately 1,000,000 or $0.10 per share compared to a net loss of 922,000 or $09 per share last year.
The net loss is due in large part to non cash expenses, including 2,300,000.0 of amortization of the company’s assets and $196,000 of share based compensation expense on stock options granted to employees and directors during the prior year. There was a bit of a decrease in the AGGRASTAT revenue, an increase in professional fees as well. There was higher revenue from sales of ZYPITAMA through MARTADrug and including current year’s expenses was R and D of $3,100,000 largely for the MC1 PNPO clinical trial. We’ve added a fifth focus the past year, that being the development of a novel drug related to MC1 with significant market potential. So a reminder that the five business focuses for Medicare are holding sales and profits from Agrestat growing Zypenumab revenue and profit growing the Marley Drug online pharmacy business the development of MC1 for PNPO deficiency, and the new chemical entity related to Medicare’s historic drug development with very large market potential.
I’d now like to turn the call over to our CFO, Hara Soodin, to review and provide some color on the 2024 financial statements.
Hara Sutin, Chief Financial Officer, Medicure Inc.: Thank you, Doctor. Friesen. A couple of quick items to note before I start. All dollar figures are in Canadian dollars unless otherwise noted by each presenter. And as a reminder, you can obtain a copy of our complete set of our financial statements for the year ended 12/31/2024 on the Investors page of our website.
Alternatively, a copy of all financial statements and management discussion and analysis can be obtained from sedarplus.ca. I will now provide some key highlights of our financial performance for the year ended 12/31/2024. Total revenue for the year ended 12/31/2024 was $21,900,000 compared to $21,700,000 for the year ended 12/31/2023. Net revenues earned from AGGRASTAT during the current year totaled 8,100,000 a decrease from the prior year where net revenue from AGGRASTAT was $9,700,000 The decrease in AGGRASTAT revenue during the current year is a result of pricing pressures from increased competition stemming from the launch of generic TYR5 and hydrochloride. Net revenues earned from Sipitamab through the traditional insurance channel during the current year totaled $3,000,000 which is an increase from the $2,400,000 of net revenue earned during the prior year.
The increase in ZYPITAMAG sales through the traditional insurance channel can be attributed to greater utilization of the product through insurance formulary, specifically Medicare Part D. This increase is offset by increased wholesaler fees in addition to higher coverage gap payments to pharmacy benefit managers. For Marley Drug, net revenue during the current year totaled $10,800,000 an increase from the prior year where net revenue totaled $9,600,000 The pharmacy business has undergone a change in its product mix since the prior year, resulting in the increase in revenue during the current year. And the pharmacy continues to focus on fulfillment partnerships, its e commerce platform and increased sales of ZYPINOVIC. Offsetting the increase in revenue is a decline in reimbursements from pharmacy benefit managers, which only impact insured prescription revenue.
AGGRASTAT cost of goods sold for the year ended 12/31/2024 totaled $2,500,000 a decrease from the prior year, where cost of goods sold totaled $3,000,000 The decrease in cost of goods sold is the result of a decrease in volume of AGGRASTAT sold, which is consistent with the lower revenue recorded in the current year. ZYPITAMAG cost of goods sold for the current year totaled 1,400,000 an increase from the prior year, where cost of goods sold for ZYPITAMAG totaled $974,000 Included within the cost of goods sold for ZYPITAMAG in the current year is $759,000 relating to products sold to customers and $620,000 from amortization of the ZYPITAMAG intangible asset. The increase in cost of goods sold noted during the current year is due to a higher volume of products sold during 2024, in addition to a recovery, which was recorded in the prior year of $281,000 relating to ZYPITAMAG royalties. Marvy drug cost of goods sold totaled $4,900,000 during the year ended 12/31/2024, an increase from the prior year where cost of goods sold totaled $3,700,000 The increase in cost of goods sold is the result nature of products sold through both the mail order and e commerce platform during the current year.
Selling expenses totaled $8,000,000 for the year ended 12/31/2024, a decrease from the prior year, where selling expenses were 8,300,000.0 The decrease in selling expenses during the current year is the result of management’s efforts in optimizing its sales and marketing expenses. This included reorganization of the company’s sales team in addition to focusing on marketing channels, which provided the greatest return on investment. General and administrative expenses totaled $4,800,000 for the current year in comparison to $4,100,000 during the prior year. The increase in general and administrative expenses in the current year is the result of higher professional fees, primarily related to legal fees, offset by lower share based compensation expense on previously granted stock options to key employees and directors of the company. Research and development expenses for the current year totaled 3,100,000.0 compared to $2,400,000 during the prior year.
The increase during the current year is primarily due to the timing of research and development expenditures relating to each development project the company is currently undertaking, which in the current year primarily related to the development of MC1. Other income during the current year totaled $1,900,000 The other income recorded during the current year was a result of a legal settlement between the company and its contract development and manufacturing organization. The company received the settlement payout in the fourth quarter of twenty twenty four. During the prior year ended 12/31/2023, the company did not record any other income. The company recorded finance income of $165,000 during the current year in comparison to finance income of $65,000 during the prior year ended 12/31/2023.
The finance income recorded during the current year consisted primarily of interest income earned on the cash held by the company, offset by bank charges and finance expenses on the company’s lease obligations. The company recorded a foreign exchange loss of $71,000 during the current year in comparison to a foreign exchange loss of $108,000 during the prior year. The change in foreign exchange relates to changes in the U. S. Dollar exchange rates during the respective years, which led to an unfavorable foreign exchange loss during both the current and prior years.
Adjusted EBITDA for the current year was negative $437,000 compared to an adjusted EBITDA of $1,900,000 during the year ended 12/31/2023. The decrease in adjusted EBITDA during the current year is primarily due to higher mortgage drug cost of goods, lower AGGRASTAT revenue, as well as higher research and development expenses. And these amounts are offset by a decrease in selling expenses, higher ZYPITAMAG sales through both the Marley Drug pharmacy and traditional insured channel. Subsequent to year end, the company acquired 100% of the outstanding shares of Gateway Medical, an independent pharmacy located in Portland, Oregon in exchange for total consideration of $580,000 In addition, the company also signed an agreement with the intention of acquiring 100% membership interest of West Olympia Pharmacy, an independent pharmacy located in West Olympia, Washington for total consideration of 975,000. The transaction of West Olympia is subject to the licenses of the pharmacy transferring from the seller to the buyer prior to the transaction closing.
The transaction is expected to close in the second quarter of twenty twenty five and both pharmacies were intended to be acquired with the intention of expanding the company’s retail pharmacy operating segment and creating synergies with Marly Drug. As at 12/31/2024, the company had cash totaling approximately $7,200,000 an increase from the $6,400,000 of cash held as of 12/31/2023. The company does not have any debt on its books. I want to remind you that there will be an opportunity at the end of today’s call for you to ask questions regarding the financial results of the company as a whole. And with that, I would like to turn the call over
Dr. Neil Owens, President and Chief Operating Officer, Medicure Inc.: to our
Hara Sutin, Chief Financial Officer, Medicure Inc.: President and Chief Operating Officer, Doctor. Neil Owens, for some additional commentary regarding our operations.
Dr. Neil Owens, President and Chief Operating Officer, Medicure Inc.: Thank you, Horace, and good morning, everyone. I’d like to start with some updates on our ZYPITAMAG business. Sales of ZYPITAMAG sold to Merleys Drug grew by 23% from $2,600,000 in 2023 to $3,200,000 in 2024. We continue to use a field based sales team as well as prescriber and consumer marketing, and have refined our marketing messaging to what we have found resonates best for both. Patients still have challenges in accessing ZYPITAMAG through their insurance coverage, which is a reason why selling ZYPITAMAG through Merli Drug is such an effective approach.
Similarly due to wholesaler and coverage gap fees, low PBM reimbursement and product returns, selling through Merli Drug provides a much higher gross margin. We’ve also found that adherence rates for patients taking ZYPITAMAG is more than 40% higher through Marley Drug compared to other retail pharmacies. Because of our customer service and engagement strategies, this helps for reducing our attrition rate and increasing revenue. Net revenue through insured channels and the standard retail pharmacy model grew by 25% from 2,400,000.0 in 2023 to 3,000,000 in 2024, due to an increase in purchasing from wholesalers and changes in our mix of insured customers. Overall ZYPITAMAG represents a priority for growth through efforts of our sales and marketing team.
Further on our Marley Drug business, net revenue grew by 12.5% from $9,600,000 in 2023 to 10,800,000.0 in 2024. This
Hara Sutin, Chief Financial Officer, Medicure Inc.: is due to
Dr. Neil Owens, President and Chief Operating Officer, Medicure Inc.: an increase in ZYPITAMAG sold through the pharmacy business, as well as generic medication sales due to multiple marketing strategies used in 2024. Notably, the sale of Brinzavi tablets through Marley drug, which is an accessible alternative SGLT2 inhibitor to Jardiance and Farxiga contributed revenue of $807,000 in 2024. Another recent example is the exclusive sale of sitagliptin, which is a first generic entry for another popular diabetes medication. Medicare is working on leveraging Marley Drug’s reputation for customer service, unique branded medication solutions and national distribution to continue to drive growth. Challenges we have faced include competition and fluctuation in cost of goods, which impact our margins, as well as lowering our customer acquisition cost as much as possible.
We also plan to invest further in our e commerce website to make it a best in class experience for customers. Recently, Medicare announced the acquisition of Gateway Medical Pharmacy and signing of a definitive agreement with West Olympia Pharmacy. These additional pharmacy subsidiaries immediately grow our customer and prescriber base for both ZYPITAMAG and other branded products and will be adopted under the Marley Drug brand. Additional benefits of these acquisitions include faster shipping times and redundancy, growing our brand nationally, increasing our revenue and our cash flow positive. In terms of our AGGRASTAT business, net revenue fell from $9,700,000 in 2023 to $8,100,000 in 2024 due to generic TYR5M competition.
Medicare remains the only manufacturer of the three point seven five milligram bolus valve format, which is typically administered before the infusion unit. We continue to provide support to our U. S. Hospital accounts and plan to remain price competitive in targeted ways. Medicare’s R and D focus is primarily on its phase three study to seek approval of MC1 as the first FDA approved therapy for patients with PMTO deficiency, which is a rare pediatric disease leading to seizures and is ultimately fatal if untreated.
If successful, use of Medicure’s legacy product MC1 could lead to a priority review voucher, which can be redeemed or sold and provides significant value. The FDA granted approval to start enrollment and so enrollment is ongoing with patients receiving treatment with MC1. Medicare also recently received Fast Track designation for MC1 for its intended indication, which will facilitate the review of Medicare’s FDA new drug application. Medicare decide to remove the enteric coating of the MC1 tablets to speed up absorption based on feedback from clinicians, and therefore that batch was produced and is now being sent to the clinical sites for use. Recently, the phase three studies first patient has completed the study enrollment period and has now moved into a continuation of phase post enrollment.
Medicare recently announced that it has signed an asset purchase agreement for the acquisition of the patent and intellectual property related to the discovery of new chemical entities that can be developed for therapeutic use. We believe that the new chemical entities will promise to provide improvements over existing lead compounds in alignment with treatment of diseases being targeted by Medicare and could provide significant long term value upon completion of all required preclinical and clinical studies and regulatory approval. Medicare has yet to announce the clinical therapeutic target, however, has started preclinical testing and API development of the lead compound. Overall revenue in 2024 ’20 ’1 point ’9 million dollars was only slightly higher than twenty twenty three of twenty one point seven million despite increases in ZYPITAMAG and MARLEY drug revenue due to lower AGGRASTAT revenue, higher MARLEY drug cost of goods, as well as higher general and administrative expenses from higher than expected legal expenses and higher research and development expenses, were 3,100,000.0 in 2024. We are therefore reporting a negative EBITDA of 437,000 and a net loss of 1,000,000 for the year.
Medicare remains debt free. And to reiterate, the company’s short term goals are focused on growing ZYPITAMAG, growing MARLY drug and our pharmacy business, maintaining AGGRASTAT sales and the development of new products. Short term seeking the approval of MC1 to receive a priority review voucher and long term the development of our new chemical entities and intellectual property for diseases with large market potential. With that I’d like to turn the call back to Doctor. Friesen for final comments.
Dr. Albert Friesen, Chief Executive Officer, Medicure Inc.: Thank you, Neil. Though overall revenue was consistent with last year there were significant developments through the acquisition of Marley, which we think strongly complements Medicare’s business, including sales and marketing of Zepitamab. The acquisition of the two pharmacies recently supports our focus on growing the business and diversifying our revenue and asset base near term through acquisitions and long term through R and D, carefully investing to grow our future profitability. My goal and that of our board, management and staff is to continue to build this business with a stable long term outlook to generate value for our shareholders. And as always, I want to express my sincere appreciation to the outstanding team of employees we’ve been blessed with.
Thank you, our shareholders, for your continued support and interest. Now Holly, I’ll turn it back to you to lead us through the Q
Holly, Conference Call Operator: question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.
One moment please while we poll for questions. Your first question for today is from Zach Treese, a private investor.
Zach Treese, Private Investor: Hello, guys. Yeah. My name is Zach. Thank you guys for the hard work you guys are doing. I just have a few brief questions.
My first question is in regard to the general and administrative expenses. I saw that legal fees were the primary cause of the increase last year. Do you guys see this coming back down in 2025?
Dr. Albert Friesen, Chief Executive Officer, Medicure Inc.: Don’t know, Dale, did you want to, Horace?
Dr. Neil Owens, President and Chief Operating Officer, Medicure Inc.: Yeah, what I can say is I would expect there still to be significant legal fees in 2025.
Zach Treese, Private Investor: Okay.
Dr. Neil Owens, President and Chief Operating Officer, Medicure Inc.: We can comment further on that, but I don’t see that actually coming down too much further, unfortunately.
Zach Treese, Private Investor: Okay, sounds good. If I may have just two other quick questions. In regard to R and D, it seems that the primary expense right now is for the MC1 development. Do you expect those expenses to continue at a similar level in 2025?
Dr. Neil Owens, President and Chief Operating Officer, Medicure Inc.: Yeah, again, go ahead. Yeah, it’s a good question. I think that they should come down versus 2024. However, we have started investing in the new intellectual property. So overall, our R and D expenses will probably be similar.
It’s right around $3,000,000 I think that we’re forecasting. So it should be consistent with 2024 as well.
Zach Treese, Private Investor: Okay, thank you. I appreciate that. Just last two questions here. For the phase three trials for MC1, do you guys have any update on the timeline for that?
Dr. Neil Owens, President and Chief Operating Officer, Medicure Inc.: Yep, so I can answer that one as well. It is a twelve month study and so we’re expecting to enroll all patients this year. It’s a very small study. We’re only targeting to enroll patients, but it’s an extremely rare disease. So it takes some effort to find all of those patients.
But we should expect to enroll all patients this year, and then they will be enrolled for twelve months. We have seen it, as I mentioned, we’ve had one patient complete the twelve months, but it’s going to be staggered as patients enroll. But then we do have a shorter review period once we’ve completed the study because it’s an orphan disease. So it’s basically an accelerated review period.
Zach Treese, Private Investor: Okay, thank you. I really appreciate that. And then the last question is regarding your latest acquisitions which is exciting. I was just wondering if you guys could provide any color on the synergies that you are expecting.
Dr. Neil Owens, President and Chief Operating Officer, Medicure Inc.: Yeah, I can jump in on that one as well. There are many. As mentioned, gaining national brand exposure for Zapitamab Barley drug is challenging. And what this does is it gives us an immediate exposure to, I would say, tens of thousands of patients through both pharmacies. Not only the patients, but their providers that we can market Zapitamab and our other branded products to.
So basically we can integrate them quite effectively and not only that, but we’re going to see some cost savings on our cost of goods just through increased purchasing power as we add the pharmacies. But it also provides redundancy just for shipping so that because we fill all 50 states, we send medications all 50 states. These other pharmacies can provide faster shipping times to the West Coast. Only because we’re trying to be competitive with other pharmacies that offer home delivery. So we want to be best in class in that sense.
And just redundancy overall in terms of fulfillment.
Zach Treese, Private Investor: Okay, thank you.
Dr. Albert Friesen, Chief Executive Officer, Medicure Inc.: And thank you, Zach, for the questions.
Dr. Neil Owens, President and Chief Operating Officer, Medicure Inc.: Yeah, thanks as well.
Holly, Conference Call Operator: We have reached the end of the question and answer session. And I would now like to turn the floor back to Doctor. Albert Friesen for closing remarks.
Dr. Albert Friesen, Chief Executive Officer, Medicure Inc.: Again, thank you for those on the call. We appreciate it. And we look forward to further updates for the next quarter. Again, thank you. Have a great day.
Holly, Conference Call Operator: Thank you, ladies and gentlemen. This concludes today’s conference. Thank you for your participation. You may now disconnect.
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