Release Date: October 24, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Orexo AB (ORXOY, Financial) reported stabilization in subsoil demand, particularly in the commercial segment, which is more profitable than Medicaid and Medicare.
- The company has seen a 22% growth in the commercial segment year-over-year, indicating strong market performance.
- Orexo AB (ORXOY) maintains a high gross margin of 86%, showcasing efficient cost management.
- The company is optimistic about the potential approval and market launch of OX 124, despite current delays.
- Orexo AB (ORXOY) is actively engaged in feasibility projects and partnerships, particularly around the Aor Fox platform, which shows promising opportunities for future growth.
Negative Points
- Orexo AB (ORXOY) faced setbacks with the FDA approval process for OX 124, requiring additional tests and manufacturing, leading to delays.
- The company experienced a decline in net revenues by 11.4% quarter-over-quarter, primarily due to inventory destocking and unfavorable FX rates.
- Legal expenses related to ongoing investigations and patent disputes have impacted financial performance.
- The company reported a marginally negative EBITDA for the third quarter, influenced by lower net revenues and legal costs.
- There is uncertainty around the timeline for OX 124 approval, as it depends on FDA's requirements for additional stability data.
Q & A Highlights
Q: Can you provide details about the upcoming meeting with the FDA regarding OX 124 and its impact on the refiling timeline?
A: The meeting with the FDA will address the complete response letter we received. We aim to clarify the data requirements needed before we can submit complementary data. The timeline for submission will depend on the extent of testing required, particularly regarding stability data. We expect to conduct manufacturing early next year, with testing following in the second quarter. The FDA's decision on review time will also affect the timeline.
Q: How significant is the ongoing study for OX 640 in securing a partnership deal?
A: The study is crucial as it addresses concerns raised in all partnering discussions, particularly regarding allergic reactions. While it is important, the conclusion of a partnership depends on various factors, including partner prioritizations and management changes. The study's results could enhance differentiation from competitors and strengthen our position in negotiations.
Q: Could you elaborate on the strategic review planned for next year and its potential impact on partnering decisions for OX 640?
A: The strategic review aims to explore the best paths for our business segments, focusing on maximizing shareholder value. While a partnership for OX 640 could proceed if the right opportunity arises, the review will consider all options, including potential spin-offs or restructuring, to optimize growth and value creation.
Q: What are the expected additional costs for the testing required for OX 124?
A: We haven't provided specific guidance yet, as it depends on the FDA's feedback. However, we estimate the total cost over the period to be around 20 million SEK. Some expenses will occur this year, within our existing guidance.
Q: How many collaborations are currently active under the amorphic platform, and what is the outlook for these projects?
A: While we haven't disclosed the exact number, we are engaged with more companies than shown in our presentation. These collaborations vary from co-projects to molecule-specific partnerships. The platform shows promise, and we are optimistic about converting early-stage projects into larger development programs.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
