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Sep 30, 2024
Anika Q3 2024 Earnings Report
Anika's revenue declined due to U.S. OA Pain Management challenges, offset by growth in international markets and Regenerative Solutions, with strategic restructuring underway.
Key Takeaways
Anika Therapeutics reported a 7% decrease in third-quarter revenue compared to the previous year, totaling $38.8 million. The decline was primarily due to challenges in the U.S. OA Pain Management sector, though this was partially offset by growth in international OA Pain Management and a 17% increase in the Regenerative Solutions business. Anika is restructuring to focus on its Commercial Channel and core HA technology.
Third quarter revenue decreased by 7% year-over-year to $38.8 million.
U.S. OA Pain Management revenue declined by 5% due to market access and pricing pressures.
Regenerative Solutions revenue increased by 17%, driven by the Integrity Implant System.
Company is restructuring to focus on Commercial Channel and core HA technology.
Anika
Anika
Anika Revenue by Geographic Location
Revenue by Geographic Location
International OA Pain Management Revenue
CapyFin.com Forward Guidance
Anika is focusing on increasing revenue in the Commercial Channel, launching Hyalofast by 2026, and bringing Cingal to the U.S. market.
Positive Outlook
- Increase the percentage of revenue in the products sold through our Commercial Channel including international sales of Monovisc, Orthovisc, and Cingal; Integrity; Tactoset®; and our rapidly advancing Regenerative Solutions pipeline.
- Intensely focused on launching Hyalofast by 2026 to treat the $1 billion U.S. addressable market.
- We filed the first Hyalofast FDA PMA module on-time in October and the final module will be filed in 2025.
- With recent progress, we’ve never been more committed to bringing Cingal, a market leading product outside the U.S., to the U.S. market which would be a tremendous value driver for Anika.
- The OEM Channel is high-margin and highly cash generative and serves as a foundation of revenue that enables us to invest in our HA-based product pipeline as well as our high-growth Commercial Channel.
Challenges Ahead
- The Company expects one-time cash restructuring and transaction charges between $3 to 5 million and non-cash charges between $27 to 29 million related to these actions and the Arthrosurface transaction.
- U.S. OA Pain Management revenue was down 5% in the quarter.
- This decline was primarily due to reduced market access and competitive pricing pressures faced by the Company’s U.S. OA Pain Management partner, J&J Medtech, and softer performance in the Arthrosurface and Parcus Medical businesses, which Anika has exited and plans to exit, respectively.
- Anika is reducing personnel and operating expenses, aligning these actions with the sale of Arthrosurface and the anticipated sale of Parcus.
- Anika is also announcing updated long-term guidance, assuming Parcus Medical and Arthrosurface are within discontinued operations beginning in the fourth quarter of 2024.