Journey Medical Corporation (NASDAQ:DERM) Q4 2022 Earnings Call Transcript

Claude Maraoui: Sure. Yes. Thank you, Scott, for that question. It is a goal of ours, and we are highly focused on achieving that. I think a number of ways, as you mentioned, partly due to the commercial structure that we have. We have taken steps in early January, and we have reduced the size of our sales force. And what we did when we were aggressive in building our portfolio, we had doubled the size of our sales force. If you go back in time and some of our other conversations, we had 42 individuals. We doubled that to 80 — another 42 to total of 84. As we peak at that point and as the sales trends continued, and then really the difficulty in the Targadox with the generic competition, we had to make some adjustments to that.

So we’ve taken those necessary steps with the field sales force. But your question was also targeted, are we going to lose any geography and coverage, reach and frequency, that type of thing. And I’d tell you that we’re not. So what we did was we actually had 2 individuals in each territory when we were at our peak of 84. We’ve reduced that now but we still have all the geographic coverage that we had in the past, albeit at some territories will only have 1 individual versus 2 and the way we decided to come to that configuration is all about profitability, and we look at profitability by territory not just on a quarterly basis but by a monthly basis. And we were able to determine the best configuration, and we feel that what we have right now will really suffice and still get us to the goals that we want to achieve.

So you would expect with the lower numbers to possibly have lower expectations, but we still have the same expectations as before. And again, all the geography is still being covered. Now every representative doesn’t have the same portfolio to promote and educate and answer questions to our customers. So we do that very custom styled in each territory. And then in the second part, really, optimization and efficiencies, we’re taking other steps to reduce that, not just by the sales force, but like you mentioned, marketing and bringing some things that we’ve used outside vendors for and bringing those internally.

Scott Henry: Okay. Great. I look forward to that progress. Shifting to the product items, ACCUTANE scripts a great, as the previous question hit on. So we should expect that to grow. Can you talk a little bit — QBREXZA is a big — the flagship product, I believe you referred to it as. How should we think about that as a growth asset? Is that a — should we be thinking about that as a 5% to 10% grower? Or ideally, I think you’d like it to be higher than that, but how should we think about it in 2023?

Claude Maraoui: Yes. I’ll start out by saying this. We had a major success last year when we settled the patent infringement cases with Padagis, and QBREXZA was part of that. And I’m glad to say we’ve got a long road of exclusivity with this brand that takes us all the way out into 2030. And our marketing and commercial teams, I think have a really good strategy to continue educating and bringing awareness and hopefully, that means increasing our demand for QBREXZA out there. In 2022, Scott, we achieved an all-time record for this particular brand, QBREXZA, and we hit well over 116,000 prescriptions. It launched in 2018, and we just hit that record. So I think we’ve got some momentum behind us. Specifically, what percent of gain that we’re going to have with each product, we’re not necessarily giving guidance on that.