Heron Therapeutics Q3 2025 Earnings Report

Heron Therapeutics EPS Results

• Actual EPS: -$0.05
• Consensus EPS: -$0.02
• Beat/Miss: Missed by -$0.03
• One Year Ago EPS: N/A

Heron Therapeutics Revenue Results

• Actual Revenue: $38.21 million
• Expected Revenue: $39.03 million
• Beat/Miss: Missed by -$818.00 thousand
• YoY Revenue Growth: N/A

Heron Therapeutics Announcement Details

• Quarter: Q3 2025
• Date: 11/4/2025
• Time: Before Market Opens
• Conference Call Date: Tuesday, November 4, 2025
• Conference Call Time: 8:30AM ET

Heron Therapeutics (NASDAQ:HRTX) is a commercial-stage biotechnology company focused on developing and commercializing therapies in pain management and supportive care for patients undergoing medical and surgical procedures. The company’s research is dedicated to addressing unmet needs in oncology supportive care and post-operative pain management through innovative drug formulations designed to improve patient outcomes and reduce reliance on opioids.

Heron’s first approved therapy, SUSTOL (granisetron) extended-release injection, received U.S. Food and Drug Administration approval in 2016 for the prevention of acute and delayed chemotherapy-induced nausea and vomiting in patients receiving moderately emetogenic chemotherapy. The company also advanced HTX-019, an injectable emulsion formulation of aprepitant, which obtained FDA approval as the first non-polyethylene glycol formulation for acute CINV prophylaxis in adults.

The company’s most advanced pipeline candidate is HTX-011, an investigational, long-acting, non-opioid local anesthetic that combines bupivacaine and low-dose meloxicam. HTX-011 is designed to provide extended post-operative analgesia and has been evaluated in Phase III trials across multiple surgical settings. In addition to HTX-011, Heron is developing other drug candidates to address various analgesic and supportive care needs and is exploring strategic collaborations to broaden the commercial reach of its portfolio.

Founded in 2011 and headquartered in Redwood City, California, Heron Therapeutics completed its initial public offering in 2015 and is listed on Nasdaq under the ticker HRTX. The company primarily serves the U.S. market and is pursuing global partnerships to expand its geographic footprint. Heron’s leadership team comprises industry veterans with expertise in clinical development, regulatory affairs and commercialization, supporting the company’s mission to deliver innovative treatments that enhance patient care.

Heron Therapeutics Q3 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Heron completed its financing, adding cash and removing a major overhang so management can focus on commercial execution; the company reaffirmed 2025 guidance of $153M–$163M in net revenue and $9M–$30M adjusted EBITDA.
• Positive Sentiment: Acute-care products showed clear commercial momentum — ZYNRELEF net sales +49% YoY and APONVIE +173% YoY — aided by the VAN, CrossLink Ignite program, a dedicated APONVIE sales team, and a permanent J-code effective Oct 1, with a pre-filled syringe program targeted for potential approval in late 2027.
• Neutral Sentiment: CINVANTI remains a steady anchor at roughly $24M in Q3 (≈+6% YoY and flat sequentially), but management cautioned that competitive pressure on average selling price could persist even as hospital pull‑through from APONVIE expands.
• Negative Sentiment: SUSTOL is under material pressure (Q3 net sales down ~32% YoY) and will be wound down over the next ~12 months; a one‑time inventory write‑off and an $11.3M loss on debt extinguishment drove a Q3 net loss of $17.5M, reducing near-term profitability.

Presentation

[Operator]

Today, and thank you for standing by. Welcome to the Heron Therapeutics Q3 2025 conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during this session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Melissa Drell, Executive Director of Legal. Please go ahead.

[Melissa Drell, Executive Director of Legal at Heron Therapeutics]

Thank you, Operator. Hello, everyone. Thank you for joining us on the Heron Therapeutics conference call today to discuss the company's financial results for the quarter ended September 30, 2025. With me today from Heron are Craig Collard, Chief Executive Officer; Ira Duarte, Executive Vice President, Chief Financial Officer; Bill Forbes, Executive Vice President, Chief Development Officer; Mark Hensley, Chief Operating Officer; and Kevin Warner, Senior Vice President, Medical Affairs, Strategy, and Engagement. For those of you participating via conference call, slides are made available via webcast and can also be accessed via the Investor Relations page of our website following the conclusion of today's call. Before we begin, let me quickly remind you that during the course of this conference call, the company will make forward-looking statements. We caution you that any statement that is not a statement of historical fact is a forward-looking statement.

[Melissa Drell, Executive Director of Legal at Heron Therapeutics]

This includes remarks about the company's projections, expectations, plans, beliefs, and future performance, all of which constitute forward-looking statements for the purposes of the Safe Harbor provision under the Private Securities Litigation Reform Act of 1995. These statements are based on judgment and analysis as of the date of this conference call and are subject to numerous important risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The risks and uncertainties associated with the forward-looking statements made in this conference call and webcast are described in the Safe Harbor statement in today's press release and in Heron's public periodic filings with the Securities and Exchange Commission. Except as required by law, Heron assumes no obligation to update these forward-looking statements to reflect future events or actual outcomes and does not intend to do so.

[Melissa Drell, Executive Director of Legal at Heron Therapeutics]

I would now like to turn the call over to Craig Collard, Chief Executive Officer of Heron.

[Craig Collard, CEO at Heron Therapeutics]

Thanks, Melissa. Hello, everyone, and welcome to Heron Therapeutics' third quarter 2025 earnings call. Today, we're thrilled to share our third-quarter results and provide insight into how product sales are trending. I'd like to begin by highlighting several key accomplishments from the quarter. One of the most significant milestones was the successful completion of our financing. This has been an overhang on the company since I joined, and we're glad to have it behind us. With this resolved, management can now fully focus on commercial execution and product growth. Beyond the successful financing, Team Heron delivered strong operational and financial performance in the third quarter. We generated total net revenues of $38.2 million for the quarter and $114.3 million year to date. This performance resulted in Adjusted EBITDA of $1.5 million for the quarter and $9.5 million year to date.

[Craig Collard, CEO at Heron Therapeutics]

Our gross margin was 68.8%, which is slightly down from previous quarters, primarily due to a one-time write-off of Sustol polymer inventory. Sustol has been trending downward over the past several months due to increased market competition, and we expect this trend to continue for the foreseeable future. CINVANTI, on the other hand, continues to exceed our expectations. We've maintained a conservative outlook this year, anticipating a potential slight decline in CINVANTI performance as we moved into Q3 and Q4. So far, that decline has not materialized. Despite ongoing competitive pressure that has historically impacted our average selling price, we're pleased that net sales are remaining fairly consistent. We believe this positive trend will continue through Q4 and into next year.

[Craig Collard, CEO at Heron Therapeutics]

Turning to our acute care portfolio, we implemented several new initiatives in Q3, including the CrossLink Ignite program, an incentive-based initiative to improve distributor engagement, the launch of the 200 mg Vial Access Needle or VAN, and the creation of the IBM team, a dedicated sales force focused on APONVIE only. All of these initiatives were rolled out at different times during the quarter and are beginning to have a meaningful impact. That's why we've consistently stated our belief that the acute products will begin to inflect more prominently as we move into late Q3 and Q4 of 2025. ZYNRELEF net sales grew 49% in Q3 2025 as compared to Q3 2024, and the APONVIE net sales grew 173% in that same time period. More importantly, we're finally seeing real momentum in acute care.

[Craig Collard, CEO at Heron Therapeutics]

While quarterly net revenues and unit demand were solid, weekly unit demand from late September through October has been the highest we've ever seen, clearly indicating a possible trend break. Mark will provide more detail on this in his prepared remarks. Lastly, our J-code for ZYNRELEF went into effect on October 1. This is a significant win for Heron and for the providers who rely on ZYNRELEF in their practices. The J-code will streamline reimbursement and reduce administrative burden, especially as the NOPAIN Act continues to gain traction. We believe this change will improve access and coverage across both government and commercial payers, ultimately supporting broader adoption and better patient outcomes. Also, our pre-filled syringe program continues to advance with a timeline to possible approval in late 2027. Bill Forbes, our Head of Development, will address any questions regarding PFS and other development initiatives in the Q&A.

[Craig Collard, CEO at Heron Therapeutics]

This quarter has been both busy and successful for Heron. With increasing demand for ZYNRELEF, APONVIE, and even SUSTOL, we're extremely excited about the trajectory of the business moving forward. I'd now like to turn the call over to Mark Hensley, our Chief Operating Officer. Go ahead, Mark.

[Mark Hensley, COO at Heron Therapeutics]

Thanks, Craig. In acute care, ZYNRELEF kept its momentum in the third quarter. This is a site-by-site, case-by-case adoption curve. Access enables, OR-proof converts, protocols make it stick. We focused on removing friction and tightening execution. The VAN made prep in the OR easier. The Ignite program kept distributors focused on accounts we can win. Our education and medical support teams helped standardize technique and support protocol adoption. As of October 1, ZYNRELEF has a permanent product-specific J-code, which makes billing conversations clearer. Stepping back, the theme is friction removal and focus. Those same disciplines translated to both the APONVIE and CINVANTI as well. In oncology supportive care, CINVANTI remains a steady anchor. As the APONVIE expands and deepens our relationships with anesthesia and pharmacy, we see CINVANTI ordering rise in those hospitals. Let me show you how this progress shows up in the revenue numbers on slide six.

[Mark Hensley, COO at Heron Therapeutics]

For our acute care franchise, net sales were $12.3 million in the third quarter, up from $10.7 million in the second quarter. ZYNRELEF net sales were $9.3 million. That is a 49% growth year over year versus $6.2 million in the third quarter of last year and up from $8.2 million in the second quarter. The drivers are consistent: the VAN, the Ignite program focusing distributors on winnable accounts, support from our education and medical support teams, and now permanent J-code clarity. The APONVIE net sales were $3 million. That is 173% growth year over year versus $1.1 million last year and up from $2.5 million in the second quarter. Third quarter APONVIE growth occurred before the dedicated team was fully active. The team finished training in October and entered the field in early Q4 to support momentum.

[Mark Hensley, COO at Heron Therapeutics]

Now, let me show how this demand shows up in ZYNRELEF operating metrics on slide seven. Our installed base continues to expand as sites move from first case to protocolized use. Average daily units increased from 882 in the third quarter last year to 1,127 in the third quarter this year, an increase of about 28%. Ordering accounts rose from 705 to 833 over the same period. This comes from friction removal and focus: the VAN, Ignite program, our education and support teams, and permanent J-code clarity streamlining reimbursement. You will also see October plotted on the line, significantly above September. It is a preliminary single month and not a proxy for the fourth quarter. We will stay disciplined and let the quarter play out. With that context, let's turn to slide eight and APONVIE. APONVIE's trajectory is strong. Demand units grew 142% year over year.

[Mark Hensley, COO at Heron Therapeutics]

Average daily units increased from 418 to 998. Ordering accounts increased from 299 to 405. We launched the dedicated APONVIE team on July 1. Six representatives focused on high-potential hospitals. The team completed full training in October, so Q3 reflects partial deployment. Full activation supports momentum going forward. In addition, the 2025 PONV Prophylaxis Consensus Guidelines are expected to be published in Q4. APONVIE is anticipated to be part of the guidelines, which should significantly increase awareness of its availability and clinical profile. We look forward to aligning our education and disseminating the information with our recently expanded field sales and medical teams. Now, turning to the oncology care franchise on slide nine. Oncology franchise net sales were $25.9 million in the third quarter. CINVANTI net sales were approximately $24 million, up about 6% year over year and stable sequentially.

[Mark Hensley, COO at Heron Therapeutics]

As APONVIE broadens anesthesia and pharmacy relationships, we are beginning to see CINVANTI pull through in those same institutions. SUSTOL net sales were $1.9 million, down about 32% year over year. We plan to wind down commercialization over the next 12 months while we evaluate potential product updates, with a possible late 2027 reintroduction subject to development and regulatory progress. We will continue to support customers and manage the transition responsibly. To wrap up, we are seeing structural progress. The VAN, the Ignite program, clinical education, and permanent J-code clarity are turning ZYNRELEF first cases into durable protocols. APONVIE's hospital curve continues to strengthen, supported by a fully trained and strategically aligned team positioned ahead of the imminent release of the updated 2025 PONV Prophylaxis Consensus Guidelines. CINVANTI remains a stable anchor, and as APONVIE expands hospital relationships, we believe CINVANTI will benefit.

[Mark Hensley, COO at Heron Therapeutics]

October stepped up for ZYNRELEF, but it is a preliminary single month. We will stay disciplined and let the quarter play out. Thanks, and I'll now turn it over to Ira.

[Ira Duarte, EVP and CFO at Heron Therapeutics]

Thanks, Mark. Our product gross profit for the three months ended September 30, 2025, was $26.3 million or 68.8%, which decreased from 71.2% for the same period in 2024. This decrease is due to an increase of $1.4 million of inventory reserves and write-offs recorded and an increase of $1.3 million in the cost of units sold, primarily due to supplier mix. For the nine months ended September 30th, 2025, our product gross profit was $84.1 million or 73.6%, which increased from 72.5% for the same period in 2024. This increase is due to an increase in units sold and a lower cost per unit due to the supplier mix. SG&A expenses for the three months ended September 30th, 2025, was $26.9 million compared to $23.3 million for the same period in 2024.

[Ira Duarte, EVP and CFO at Heron Therapeutics]

The increase is primarily due to higher personnel and related expenses due to new hires and increased ZYNRELEF marketing costs. SG&A expenses for the nine months ended September 30, 2025, was $78 million compared to $77.3 million for the same period in 2024. The increase is primarily due to increased marketing costs related to ZYNRELEF, offset by a decrease in personnel and related costs due to terminations and a one-time stock compensation expense in 2024, which did not reoccur in 2025, and a decrease in legal expenses due to timing of litigation. Research and development expenses were $3.5 million for the three months ended September 30, 2025, compared to $4.5 million for the comparable period in 2024. The decrease is primarily due to timing of expenses.

[Ira Duarte, EVP and CFO at Heron Therapeutics]

Research and development expenses were $8.7 million for the nine months ended September 30, 2025, compared to $13.5 million for the comparable period in 2024. The decrease is due to decreases in personnel and related expenses due to terminations and a decrease in write-offs of property and equipment and other assets. For the three months ended September 30th, 2025, we incurred a net loss of $17.5 million compared to a net loss of $4.8 million for the same period in 2024. The increase in net loss is primarily due to the $11.3 million loss on debt extinguishment recognized in the quarter. For the nine months ended September 30th, 2025, and 2024, we incurred a net loss of $17.2 million. The net loss for the nine months ended September 30, 2025, included a one-time charge of $11.3 million related to our recent debt extinguishment.

[Ira Duarte, EVP and CFO at Heron Therapeutics]

Cash and short-term investments at September 30th, 2025, was $55.5 million. As a result of the debt and equity transactions completed in the three months ended September 30th, 2025, $13.1 million was added to cash and short-term investments. If we had excluded depreciation, stock-based compensation, and inventory reserves and write-offs, our Adjusted EBITDA results would have been a positive $1.5 million operating income for the three months ended September 30, 2025, compared to a loss of $400,000 for the same period in 2024. For the nine months ended September 30, 2025, our Adjusted EBITDA is $9.5 million operating income compared to a loss of $700,000 for the same period in 2024. We are reaffirming our previously given guidance for net revenue of $153 million-$163 million and Adjusted EBITDA of $9 million-$30 million. Now we'd like to open the call for any questions.

[Operator]

Thank you. At this time, we will conduct a question-and-answer session. As a reminder, to ask a question, you need to press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while I compile the Q&A roster. Our first question comes from Carl Byrnes from Northland Capital Markets. Please go ahead.

[Carl Byrnes, Managing Director and Senior Research Analyst at Northland Capital Markets]

Thanks for the question. Congratulations on the quarter. Just turning back to the slide with respect to ZYNRELEF and the first few weeks of October, it looks like you're pushing 18% in terms of increase. That's on a month-over-month basis. Is that correct?

[Mark Hensley, COO at Heron Therapeutics]

Yes, Carl, that's correct. It's roughly correct. Yeah, it's 17%-18% right in there.

[Carl Byrnes, Managing Director and Senior Research Analyst at Northland Capital Markets]

Excellent. Fantastic. Then a financial question. If we look at gross profit margin and back out the one-time stocking charge, which I think is around $2.2 million, you end up with approximately an adjusted gross profit margin, which would be around 74.5%. Does that sound correct?

[Ira Duarte, EVP and CFO at Heron Therapeutics]

That is correct, Carl.

[Mark Hensley, COO at Heron Therapeutics]

Yeah, that's accurate.

[Ira Duarte, EVP and CFO at Heron Therapeutics]

Which is in line with what we've been for the last few quarters.

[Carl Byrnes, Managing Director and Senior Research Analyst at Northland Capital Markets]

Okay. And then one further adjustment, which is the extinguishment of debt. What would the net interest income line be backing that out? Would that be somewhere in the $2.1 million vicinity, or what number should we use there?

[Ira Duarte, EVP and CFO at Heron Therapeutics]

Going forward, yeah, probably about $2.5 million would be going forward.

[Carl Byrnes, Managing Director and Senior Research Analyst at Northland Capital Markets]

Yeah. Okay. So 2.1 for the quarter, but sort of adjusted for the full quarter.

[Ira Duarte, EVP and CFO at Heron Therapeutics]

For the full quarter, yeah.

[Carl Byrnes, Managing Director and Senior Research Analyst at Northland Capital Markets]

2.5 plus. You got it. Cool. Perfect. Congrats again. Thank you.

[Mark Hensley, COO at Heron Therapeutics]

Thanks, Carl.

[Operator]

Thank you. Our next question comes from Brandon Folkes from H.C. Wainwright. Please go ahead.

[Brandon Folkes, Biotech Equity Research at H.C. Wainwright & Co LLC]

Hi. Thanks for taking my questions, and congratulations on the quarter. Maybe just from me, understanding it's very early days on the internal sales team. Can you just talk about, though, how you're viewing those on ZYNRELEF and APONVIE. And how you're thinking about potentially adding to those teams in 2026, or sort of the measure of success to potentially add to those teams in 2026, and then any additional investments you're thinking on the commercial side behind the two products in 2026?

[Mark Hensley, COO at Heron Therapeutics]

Thanks for the question, Brandon. This is Mark Hensley. I'll start, and then we'll let Craig kind of finish it up. Internally, we're very pleased with the kind of structural changes we made at the beginning of Q3. Just as a reminder, we now have a dedicated ZYNRELEF team, a dedicated APONVIE team. That APONVIE team is also beginning to do some work with CINVANTI. We think there's a lot of synergy there on both sides. The increased focus, we believe, has a partial impact on the results we're seeing in the quarter and certainly as we go forward into next year. In addition to that, we have better alignment with our distributor partners. We think all of those things being put together will result in increased sales as we go forward.

[Mark Hensley, COO at Heron Therapeutics]

Yeah, Brandon, I would sort of add to that as we think about the product going forward or the products going forward. I think we've been pretty consistent in saying when we see sort of pockets in the country take off and we have, let's call it, conducive events like access into an account, we have good CrossLink participation, and we have certainly personnel in that area. Once we see that type of success, we would like to obviously mimic that where we can. I think going forward, we continue to look for those pockets, and we're beginning, as the data suggests, we're beginning to see that. We're in the process of going through our budgeting process for the year, and I think we'll be looking at where we can add in specific pockets and, again, staying within profitability and so forth.

[Mark Hensley, COO at Heron Therapeutics]

I think you're going to see more to come on that because, again, we're beginning to see a little bit of a different trend. If we can expand that, we would certainly like to do that.

[Brandon Folkes, Biotech Equity Research at H.C. Wainwright & Co LLC]

Fantastic. Maybe just one follow-up from me, just on ZYNRELEF. Granted, the demand curves look really, really good. Appreciate you sharing those. Just given the VAN came online pretty significantly in the quarter, any inventory stocking benefit in the revenue, in the reported revenue line in 3Q on ZYNRELEF?

[Mark Hensley, COO at Heron Therapeutics]

We did not see we had that kind of similar bump when we launched the 400 VAN. Because the 200 VAN is really only about 35% of the total sales, there was a minimal, let's say, bump, I guess, but not to the degree that we saw with the 400. Inventory remained relatively stable compared to prior quarters.

[Brandon Folkes, Biotech Equity Research at H.C. Wainwright & Co LLC]

Great to hear. Congrats on the quarter, and that's all from me.

[Mark Hensley, COO at Heron Therapeutics]

Thank you. Thanks, Brandon.

[Operator]

Thank you. Our next question comes from Serge Belanger from Needham & Company. Please go ahead.

[Serge Belanger, Analyst at Needham & Company]

Hi, good morning. First question regarding the NOPAIN Act. You just gave us an update on its implementation. What you're seeing from commercial plans, whether they're following in the footsteps of Medicare? Secondly, on the oncology care franchise, maybe just provide a little bit more color on your long-term outlook for that franchise. Sounds like you expect Sustol to remain under pressure for the foreseeable future. On CINVANTI, do you expect competitive pressures to come back despite the ones that didn't materialize in the third or fourth quarter? Thanks.

[Mark Hensley, COO at Heron Therapeutics]

Yeah, Serge, I'll take the CINVANTI question, then I'll pass the other over to Kevin on the NOPAIN Act. Again, we've been saying all year long, and even in my prepared remarks about CINVANTI, we felt that with the competition out there, that we could see a little bit of a dip in Q3 and Q4. We have yet to see that. We've been fairly consistent in being able to keep accounts and that type of thing. To your point, it is a very competitive space, and we will continue to have pressure. We could lose an account from time to time, or we could be forced to take our price down to keep an account. I mean, that's just sort of the market we're in. We're going to continue to sort of look at this pretty conservatively.

[Mark Hensley, COO at Heron Therapeutics]

What I can say on the upside, though, with the IBM team that we have, we're beginning to promote CINVANTI a bit more from a rep standpoint within hospital accounts. Again, we're thinking that will have or could have a positive impact. Still facing the same competition, but the fact that we have a little bit of a larger voice out there, we've actually had an account we won about three weeks ago that was fairly significant. If we can keep doing that, we think we can keep things fairly stable as we move forward. We'll continue to update quarterly, but I think our outlook remains fairly consistent with things we've said before.

[Craig Collard, CEO at Heron Therapeutics]

Yeah. Hey, Serge, Kevin Warner. In regards to the NOPAIN Act and the impact we're seeing out in the field, it's definitely starting to build momentum. As we said previously, as expected, it would take six to nine months and be tail half of the year once providers and systems got educated on the fact that you could reimburse outside the bundle. That's not typical, as we know. We're seeing education happen across all segments from some of our competitors, obviously, other companies that are included in the NOPAIN Act. They're standing at platform presentations like at ASA and delivering the message out there. We're continuing to educate around it, provide the systems in place and educational materials of how to actually bill separately. Commercial payers, to your point on that question, we are seeing some momentum there also.

[Craig Collard, CEO at Heron Therapeutics]

We believe it would take them time to reassess and do a rearview take on it and see what's happening with implementation. You have providers like Aetna and Cigna that are providing separate reimbursement. It varies state by state with individual commercial plans that we see out there. Overall, as an estimate, we see about 75% of all ZYNRELEF indicated procedures, especially our target procedures, have some form of coverage, whether it be a Medicare or a commercial plan. We have a few other things from the economic perspective that are tailwinds coming into 2025 for us when you look at the Teams model by CMS, which is a value-based care model. You're looking at things like patient-reported outcomes and satisfaction. Do you feel pain? Do you have PONV? That's going to be a significant tailwind.

[Craig Collard, CEO at Heron Therapeutics]

Also, the dissolution of the inpatient-only list, specifically about 285 orthopedic procedures are coming off that inpatient-only list. That'll make them outpatient-eligible procedures now and thus reimbursable under things like the NOPAIN Act. A lot of value and impact is coming to our patients and really changing the model to a value-based care, looking for these advances in our healthcare system, long-acting advances like ZYNRELEF and APONVIE that can help facilitate this transition as we're moving our phases of care.

[Mark Hensley, COO at Heron Therapeutics]

Yeah. Serge, just to maybe address the second part of your question regarding Sustol. Similar scenario as we face with CINVANTI, although it's just been a little bit more competitive on that side. Again, we have fewer accounts. What we've seen over the last few years, we've had a continual decline and a continual decline on our ASP. What we've decided to do is wind this product down over the next, into next year. Again, our plan is to look at possibly improving the delivery of that product, whether that be a lighter gauge needle or what have you. We would like to bring that out possibly late 2027, back into 2028, as a relaunch product. Again, there are things we can do there from our selling price and that type of thing that would possibly bring this product back to market.

[Mark Hensley, COO at Heron Therapeutics]

We will talk more about that as we move forward and ideas that we have. The plan now is to wind this down as we move really to the end of next year.

[Carl Byrnes, Managing Director and Senior Research Analyst at Northland Capital Markets]

Great. Thanks.

[Operator]

Thank you. Our next question comes from Clara Dong from Jefferies. Please go ahead.

[Operator]

Hi. This is Angie on for Clara. Thank you for taking our question and the congrats on the quarter. My question is about the ZYNRELEF pre-filled syringe program. You said if successful, it's expected to be approved in 2027. Based on your feedback from physicians on VAN, how do you expect the pre-filled syringe program to help on the franchise in the long term? How can we think of the momentum there? Thank you.

[Bill Forbes, EVP and Chief Development Officer at Heron Therapeutics]

Hi. Thank you for your question. This is Bill Forbes. I'll just give a little bit of an update on this. We've recently just manufactured our registration batches, and with that, have initiated our stability program. As you know, every new product has to undergo at least one year of real-time stability. We've got that clock ticking. We're glad we've crossed that milestone, and that's why we're looking. Obviously, once we've completed that stability program, we'll go ahead and file, and it will be approved, hopefully, in 2027. The impact, I think, is one that, as you can see from the VAN, we've had a bit of an uptick. I think as far as simplifying and speeding the application and use of ZYNRELEF, the VAN has been a big step forward. The Pre-filled syringe takes it to another level.

[Bill Forbes, EVP and Chief Development Officer at Heron Therapeutics]

Obviously, in this scenario, we're just going to go ahead and open up the Pre-filled syringe packaging and place it in the surgeon's hands so that they can go ahead and install the product. I think when it comes to receiving the product, it simplifies things even to a much greater extent. Obviously, we'll speed, I believe, the conversion of accounts into use of ZYNRELEF. I don't know if Mark has any other comments on it.

[Mark Hensley, COO at Heron Therapeutics]

No, I think that was great. Yeah. I would just add, I think Bill's spot on it. When you think about simplicity, we still have the scenario where when we go into onboard an account, there is a training, even though the VAN has improved it dramatically, and being able to draw the product out of the vial. If you think about really being able to simplify your product, and now you go in and you open a tray and you dump the product in the sterile field, and basically it's ready to go, it just takes one step out of the process. Again, we certainly think this is going to have a positive impact. Again, as things are moving forward, we think this just makes the product that much better and adds another benefit.

[Mark Hensley, COO at Heron Therapeutics]

Okay. Thank you. I do have a follow-up. For the J-code for ZYNRELEF, it's also applicable to the pre-filled syringe and also for the VAN, right?

[Mark Hensley, COO at Heron Therapeutics]

It would be once the Pre-filled syringe is launched. Yes, that's correct.

[Mark Hensley, COO at Heron Therapeutics]

Okay. Got it. Got it. Thank you.

[Operator]

Thank you. This concludes the question and answer session. I'll now turn it over to Craig Collard, CEO, for closing remarks.

[Craig Collard, CEO at Heron Therapeutics]

Thank you, Ralph Ritter. Thank everyone for joining the call today, and we look forward to speaking to you all next quarter.

[Operator]

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

Participants

Executives

• Melissa Drell, Executive Director of Legal
• Mark Hensley, COO
• Bill Forbes, EVP and Chief Development Officer
• Ira Duarte, EVP and CFO

Analysts

• Serge Belanger, Analyst at Needham & Company
• Craig Collard, CEO at Heron Therapeutics
• Carl Byrnes, Managing Director and Senior Research Analyst at Northland Capital Markets
• Brandon Folkes, Biotech Equity Research at H.C. Wainwright & Co LLC
• Analsyt at Jefferies