Biofrontera Q1 2025 Earnings Report

Biofrontera EPS Results

• Actual EPS: -$0.47
• Consensus EPS: -$0.14
• Beat/Miss: Missed by -$0.33
• One Year Ago EPS: N/A

Biofrontera Revenue Results

• Actual Revenue: $8.59 million
• Expected Revenue: $10.55 million
• Beat/Miss: Missed by -$1.96 million
• YoY Revenue Growth: N/A

Biofrontera Announcement Details

• Quarter: Q1 2025
• Date: 5/15/2025
• Time: After Market Closes
• Conference Call Date: Friday, May 16, 2025
• Conference Call Time: 10:00AM ET

Biofrontera (NASDAQ:BFRI), a biopharmaceutical company, engages in the commercialization of pharmaceutical products for the treatment of dermatological conditions in the United States. The company's products are used for the treatment of actinic keratoses, which are pre-cancerous skin lesions, as well as impetigo, a bacterial skin infection. It offers Ameluz, a prescription drug for use in combination with the RhodoLED lamp series, for photodynamic therapy for the lesion-directed and field-directed treatment of actinic keratosis of mild-to-moderate severity on the face and scalp. The company also provides Xepi, a topical non-fluorinated quinolone that inhibits bacterial growth for the treatment of impetigo. The company was incorporated in 2015 and is headquartered in Woburn, Massachusetts.

Biofrontera Q1 2025 Earnings Call Transcript

Key Takeaways

• Biofrontera reported Q1 revenues of $8.6 million, up 8.7% year-over-year, while both cost of revenue and operating expenses declined, supporting guidance for record 2025 revenue without higher spending.
• The U.S. patent office granted exclusivity on the new propylene glycol-free Ameluz formulation through December 2043, securing roughly 18½ years of generic protection.
• The final patient was enrolled in the Phase 3 actinic keratosis trial for extremities, neck and trunk, and a 16-patient Phase 1 pharmacokinetic study launched in January to enable label expansion beyond face and scalp.
• All patients in the Phase 3 superficial basal cell carcinoma study completed their one-year follow-up in December 2024, and Biofrontera plans to submit these data to the FDA in H2 2025 for approval.
• Recruitment for the Phase 2 moderate-to-severe acne study is complete, with topline data expected by year-end as Biofrontera pursues a high-need dermatology indication.

Presentation

[Operator]

Good day, and welcome to the Biofrontera's First Quarter twenty twenty five Financial Results and Business Update Conference Call. All participants will be in listen only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Andrew Barwicki. Please go ahead.

[Andrew Barwicki, President at Barwicki Investor Relations]

Good morning, and welcome to Biofrontera Incorporated's first quarter fiscal year twenty twenty five financial results and business update conference call. Please note that certain information discussed during today's call by management is covered under the Safe Harbor provisions of the Private Securities Litigation Reform Act. We caution listeners that Biofrontera's management will be making forward looking statements and that actual results may differ materially from those stated or implied by these forward looking statements due to risks and uncertainties associated with the company's business. All risks and uncertainties are detailed in and are qualified by the cautionary statements contained in Biofrontera's press releases and SEC filings. Also, this conference call contains time sensitive information that is accurate only as of the date of this live broadcast, 05/16/2025.

[Andrew Barwicki, President at Barwicki Investor Relations]

BioFrontera undertakes no obligation to revise or update any forward looking statements to reflect events or circumstances after the date of this conference call, except as required by law. During today's call, there will be references to certain non GAAP financial measures. Biofrontera believes these measures provide useful information for its investors, yet should not be considered as a substitute for GAAP nor should they be viewed as a substitute for operating results determined in accordance with GAAP. A reconciliation of non GAAP to GAAP results is included in the press release that was issued yesterday. More specifically, management will be referencing adjusted EBITDA, a non GAAP financial measure defined as net income or loss excluding interest income and expense, income taxes, depreciation and amortization and certain other non recurring or non cash items.

[Andrew Barwicki, President at Barwicki Investor Relations]

With that being said, I would now like to turn the call over to Herman Louvert, CEO, Chairman and Founder of Biofrontera. Herman?

[Hermann Luebbert, CEO, Chairman & Founder at Biofrontera]

Yes. Thank you, Andrew, and my thanks to everyone joining us this morning. On today's call, I'll provide an overview of our business during the first quarter. Clyde Lefler, our CFO, will follow with a discussion on financial results and then both of us will be happy to answer questions after our prepared remarks. Starting with the business update, our first quarter was a busy and exciting period for us.

[Hermann Luebbert, CEO, Chairman & Founder at Biofrontera]

We continued our revenue growth while keeping our costs under control. Total revenues for the first quarter of twenty twenty five were 8,600,000.0 a 9% increase from the same period of the prior year. Both our cost of revenue and our operating costs were lower than in the same period of the previous year as Fred will explain in much more detail. We strongly believe our past investments, execution and tremendous efforts to increase the effectiveness of our sales force will allow us to achieve record revenues in 2025 without increasing our costs. On top of the positive financial development, we achieved several more milestones.

[Hermann Luebbert, CEO, Chairman & Founder at Biofrontera]

An important development for our long term future is the recent granting of a patent on the new formulation of Ameluz. This new formulation, which lacks the potential allergen propylene glycol, have already been approved by the FDA and is in use since last year. Having no patent protection on this Ameluz formulation until December 2043 gives us another eighteen point five years of protection from generic competition. We announced the enrollment of the final patient in the Phase three clinical trial evaluating Ameluz for the treatment of mild to moderate actinic keratosis on the extremities, neck and trunk. Currently, label is restricted to treatments of AK on the face and scalp.

[Hermann Luebbert, CEO, Chairman & Founder at Biofrontera]

The goal of this study is to extend the label to the entire body. This represents another important cornerstone in our overall strategy, complementing the use of free tubes and the availability of the larger lab both launched in 2024. As the last building block for this label extension, FDA has requested a Phase one pharmacokinetic study with 16 patients, which started in January and is currently recruiting. Furthermore, we reached a key milestone in the Phase three study for the use of Ameluz and Autoled PTC in the treatment of superficial basal cell carcinoma. The last patient completed the one year follow-up visit, which is required for FDA approval in December 2024.

[Hermann Luebbert, CEO, Chairman & Founder at Biofrontera]

We believe Ameluz has additional applications other than actinic keratosis and we are committed to explore these opportunities. So our next goal is approval for superficial basal cell carcinoma. I can tell you that being able to treat actinic keratosis, which are precancerous lesions that may progress to squamous cell carcinoma is a wonderful feeling, but to expand beyond that to treating certain skin tumors is very encouraging and exciting for all of us here at Biofrontera. We expect to submit the new data to the FDA in the second half of this year. Following the approvals for AK on the entire body and for superficial basal cell carcinoma, we are aiming to at getting Ameluz approved for the treatment of moderate to severe acne.

[Hermann Luebbert, CEO, Chairman & Founder at Biofrontera]

Acne is the most frequent indication seen by dermatologists and the treatment options available for the more severely affected patients suffer from very considerable side effects. This creates a significant medical need for these patients. Our ongoing Phase two study in this indication is close to completing patient or it has completed patient recruitment and data will be available towards the end of the year. The further development plan will be discussed with the FDA once the data of this study become available. As I look back on the first quarter, in addition to the achievements and milestones, we were able to lower the cost of revenues, total operating expenses and SG and A.

[Hermann Luebbert, CEO, Chairman & Founder at Biofrontera]

We continue to monitor and be very prudent in all aspects of our business and operations. Additionally, we increased EBITDA and gross profit, all of which support our goal of reaching breakeven as quickly as possible. We believe we have built the foundation with the sales team and back end support to continue to improve our results on a consistent basis. With that, I'll turn the call over to Fred to walk through the financial details of the second quarter. Fred?

[Fred Leffler, CFO at Biofrontera]

Thank you, Herman. Pleasure talking with everyone again, and I'll cover our first quarter twenty twenty five results. Total revenues for the first three months ended 03/31/2025 were $8,600,000 an increase of $700,000 or 8.7% as compared to the three months ended 03/31/2024. This increase was driven by a $500,000 increase in Ameluz sales due to an increased unit price and the launch of our RotoLED XL lamp, which resulted in sales of the XL lamp of $200,000 Total operating expenses were $13,100,000 for the first quarter of twenty twenty five compared with $13,400,000 for the first quarter of twenty twenty four. Cost of revenues related party were $3,100,000 for the first quarter of twenty twenty five compared with $4,000,000 for the prior year quarter.

[Fred Leffler, CFO at Biofrontera]

This decrease of $900,000 or 22.1% compared to last year was due to the reduced cost structure under the last amendment of the Ameluz license and supply agreements. Selling, general and administrative expenses for the three years ended or three months ended 03/31/2025 decreased by $600,000 or 6.5% as compared to the three months ended 03/31/2024. Selling and marketing expenses decreased by $800,000 with a 300,000 decrease coming from direct sales team personnel expenses due to headcount fluctuation and a $500,000 decrease driven by reduced general marketing activity and spend on conferences. These decreases were partially offset by an increase in legal expenses of $1,200,000 due to patent claims which was partially offset by savings of 800,000.0 in personnel and financing expenses. Research and development R and D expenses for the first three months of twenty twenty five increased by $1,200,000 as compared to the first three months of twenty twenty four.

[Fred Leffler, CFO at Biofrontera]

The increase is attributed to our assumption of all clinical trial activities for Ameluz in The United States effective as of 06/01/2024, which allow us to for more effective cost management and direct oversight of trial efficiency. These increases in R and D expense were and will continue to be offset by a reduction in the transfer price of Ameluz from 50% to 25% for inventory purchases made through 2025. The net loss for the first quarter of twenty twenty five was $4,200,000 or $0.47 per share compared with a net loss of $10,400,000 or $2.88 per share for the prior year quarter. The change in net loss reflects a decrease in the non cash change in the fair value of warrant liabilities driven by a decrease in the outstanding population, a decrease in interest expense due to the payoff of high interest debt in 2024 and the aforementioned decreases in cost of revenues related party and selling, general and administrative expense is partially offset by increased R and D spending. Adjusted EBITDA increased from $4,600,000 for the first three months ended 03/31/2024 to 4,400,000.0 or as compared to $4,400,000 for the three months ended 03/31/2025.

[Fred Leffler, CFO at Biofrontera]

The improvement was driven by an increase in gross profit of $1,500,000 offset by $1,200,000 increases in R and D expenses. These changes were driven by the reduced cost structure under the latest amendment of the Ameluz license agreement and the assumption of all clinical activities for Ameluz in The United States. I'll refer you to the table in the news release we issued yesterday for a reconciliation of GAAP to non GAAP financial measures. Turning to our balance sheet as of 03/31/2025, we had cash and cash equivalents of 1,800,000 compared with $5,900,000 as of 12/31/2024. Finally, we have $6,500,000 of inventory on hand as compared to $6,600,000 of inventory as of 12/31/2024.

[Fred Leffler, CFO at Biofrontera]

With that overview of our business and recent financial performance, Herman and I are now ready to take questions from our covering analysts.

[Operator]

We will now begin the question and answer session. Our first question will come from Jonathan Aschoff with ROTH Capital. Please go ahead.

[Jonathan Aschoff, Managing Director, Senior Research Analyst at Roth Capital Partners, LLC]

Thank you. Good morning. I was curious over 1Q twenty five, how many LAMP units did you sell both the original and the XL? Hello?

[Fred Leffler, CFO at Biofrontera]

Yes. Hey, Jonathan, right here. Sorry, was on mute. So placements as of Q1 were 18 we placed 18 of the XL lamps.

[Jonathan Aschoff, Managing Director, Senior Research Analyst at Roth Capital Partners, LLC]

And that's just in the first quarter?

[Fred Leffler, CFO at Biofrontera]

That's in the first. Yes, yes, exactly.

[Jonathan Aschoff, Managing Director, Senior Research Analyst at Roth Capital Partners, LLC]

Okay. And how about the original ones?

[Fred Leffler, CFO at Biofrontera]

The original ones, I will have to double check on that one. I don't have the original right at my fingertips.

[Jonathan Aschoff, Managing Director, Senior Research Analyst at Roth Capital Partners, LLC]

That's fine. My second and last question is, any sales force attrition just the comment in the press release, savings of $800,000 in personnel and financing expenses. And I'm curious, what is the current sales force headcount, say, versus the end of the year? Is there any attrition there that explains that drop in expense?

[Fred Leffler, CFO at Biofrontera]

Yes. Herman, do you want me to take that one?

[Hermann Luebbert, CEO, Chairman & Founder at Biofrontera]

Yes.

[Fred Leffler, CFO at Biofrontera]

Well, we are looking at how we're structuring our commercial team and what types of roles are a good fit for the larger territories and some things like that. So we're working on bringing in some more what we call like a more junior rep that's like ready to be on the road. Some of that comes with bit lower salary. And then some of it has been some turnover but we're committed to replacing that and reorganizing the territories and the team to be as efficient as possible to finish up the year strong.

[Jonathan Aschoff, Managing Director, Senior Research Analyst at Roth Capital Partners, LLC]

All right. Thank you very much.

[Operator]

The next question will come from Bruce Jackson with The Benchmark Company. Please go ahead.

[Bruce Jackson, Senior Analyst at The Benchmark Company LLC]

Hi, good morning and thank you for taking my questions. Wanted to take a moment to look at the gross margins. So you've got the change in the transfer pricing, which gave you a little bit of a boost in the first quarter. How is that going to play out over the rest of the year?

[Fred Leffler, CFO at Biofrontera]

Yes. So in the first quarter, we did burn off a bit of Analu's inventory that was still under the prior LSA cost structure. So that should that's all gone. So we have all of the inventory we have now is at the 25% transfer price and that's what we will see for the rest of the year. It might be offset.

[Fred Leffler, CFO at Biofrontera]

So if that was the only thing we sold then cost of goods would be 25%. However, there's going to be some fluctuation in that, based on how many lamps we sell because the margin there is lower.

[Bruce Jackson, Senior Analyst at The Benchmark Company LLC]

Okay. Okay. And then a question on the three tube indication. Sometimes it takes time for the payers to get the reimbursement information into their databases. Can you just kind of give us an update on the status of the reimbursement for the three tube indication and is that all systems go now for you?

[Hermann Luebbert, CEO, Chairman & Founder at Biofrontera]

Yes, we paid a lot of attention to that when after we got approval and focused initially on Medicare, making sure that Medicare actually covers this and then send all the information to all the private payers. So from what we hear so far, I mean, we have to rely on feedback from the market. We are not aware of a single case where a doctor has been refused payment because of using more than one tube. So this seems to be completely solved.

[Bruce Jackson, Senior Analyst at The Benchmark Company LLC]

Okay, great. That's it for me. Thank you.

[Operator]

Thank you. This will conclude our question and answer session. I would like to turn the conference back over to Herman Luber for any closing remarks.

[Hermann Luebbert, CEO, Chairman & Founder at Biofrontera]

Yes. Well, thank you, operator. As you heard, the first quarter has been a very exciting time for us and we look forward to the rest of the year. Each day our sales team gets new clients, which is a victory for the customer facing strategy that we have implemented. I would like to thank everyone for participating in this call and we look forward to speaking with you again when we report our second quarter results. Thank you and have a nice day.

[Operator]

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.

Participants

Executives

• Hermann Luebbert, CEO, Chairman & Founder
• Fred Leffler, CFO

Analysts

• Andrew Barwicki, President at Barwicki Investor Relations
• Jonathan Aschoff, Managing Director, Senior Research Analyst at Roth Capital Partners, LLC
• Bruce Jackson, Senior Analyst at The Benchmark Company LLC