Verrica Pharmaceuticals Inc. Q1 FY2024 earnings call

• YCANTH launch: Net revenues of $3.2M in Q1, expanded eligible Medicaid population to 228M lives, secured 31 hospital formulary approvals, permanent J-Code effective April 1, agreements with 2 large PBMs, distribution deal with Walgreens, and NCE listing in Orange book.
• Pipeline: Reached agreement with Torii Pharmaceuticals for joint global Phase III trial of YCANTH for common warts, planned for 2025. VP-315 Phase II study for basal cell carcinoma, with preliminary top-line data expected in Q2.

In the first quarter of 2024, Verrica Pharmaceuticals recorded YCANTH net revenues of $3.2 million. The company expanded its eligible Medicaid patient population to 228 million lives covered by insurance, secured 31 hospital formulary approvals, and obtained a permanent J-Code for YCANTH effective April 1. Additionally, it signed agreements with major PBMs and a distribution deal with Walgreens, and YCANTH received NCE listing in the Orange book.

• Cash and cash equivalents as of March 31, 2024, are sufficient to fund operations into Q1 2025.
• Expect continued quarter-over-quarter revenue growth for YCANTH in 2024.
• Pivotal Phase III trial for common warts with Torii planned in 2025 in the US and Japan with minimal impact on Verrica's cash position.

• Uncertainties in forward-looking statements due to inherent risks and uncertainties, which could cause actual results to differ materially from expectations.
• Risks related to regulatory developments, potential generic competition, and outcomes of clinical trials.

Q: Are you able to discuss additional early metrics around the J-Code in April in terms of account demand and transitioning to buy-and-bill?

A: The J-Code is making progress with an uptick in new accounts, and there's an increase in buy-and-bill accounts. Just a month or so into it, it's about 60-40 between specialty pharmacy and buy-and-bill initially but expected to shift further.

Q: Can you comment on the sales trajectory expectations for the year, especially Q2, and progress with pediatricians?

A: Expect continued quarter-over-quarter growth. Early into the pediatrician expansion, seeing an uptick in pediatric prescribers with several jumping on the buy-and-bill model, and pediatric dermatology demand high.

Q: Are you starting to see a meaningful shift towards buy-and-bill post-J-Code publication, and any economic differential for Verrica?

A: Seeing an increase in buy-and-bill accounts. More economical for Verrica if physicians move to buy-and-bill; specialty pharmacy has higher costs due to white bag shipping model.

Q: What's the status on compounded cantharidin and official top-down regulation from the FDA?

A: Filed a citizen's petition and drug import alert, but not heard back from FDA yet. However, organically making progress by shutting down some compounding pharmacies and working with Dormer Labs on distribution.

Q: Can you talk about inventory levels and the common warts program with Torii?

A: Inventory supplied based on forward-looking demand expectations. Torii is expected to carry a heavy load on investment for the common warts program with minimal impact on Verrica's cash position as per the agreement.