Journey Medical Corporation reported significant financial challenges in its 10-Q filing for the quarter ending September 30, 2024. The company experienced a substantial decline in revenue, with total revenue for the three-month period falling to $14.6 million, a decrease of 58% from $34.5 million in the same period of 2023. For the nine-month period, revenue decreased by 33% to $42.5 million from $63.9 million in the prior year. This decline was primarily attributed to the absence of revenue from the Maruho Agreement, which had contributed $19.3 million in the previous year, and decreased sales from several product lines.

Operating expenses for the three-month period increased slightly to $17.5 million from $17.3 million in 2023, while for the nine-month period, they decreased to $58.4 million from $63.9 million. The company reported a loss from operations of $2.9 million for the three-month period, a stark contrast to the income of $17.2 million reported in the same period of the previous year. For the nine-month period, the loss from operations was $15.9 million, compared to a modest income of $31,000 in 2023.

Net loss for the three-month period was $2.4 million, down from a net income of $16.8 million in 2023, and for the nine-month period, the net loss increased to $16.2 million from $1.7 million in the prior year. The company’s cash and cash equivalents also decreased to $22.5 million from $27.4 million at the end of 2023.

Strategically, Journey Medical has been focusing on its product portfolio, which includes seven branded and two authorized generic drugs for dermatological conditions. The company received FDA approval for Emrosi on November 4, 2024, which will trigger a $15 million milestone payment obligation to Dr. Reddy’s Laboratories. The company is also in the process of completing the manufacturing of Emrosi for the U.S. market, with plans for commercialization in early 2025.

In terms of financing, Journey Medical entered a Credit Agreement with SWK Funding LLC, which provides a term loan facility of up to $25 million. As of September 30, 2024, the company had drawn $20 million from this facility. The company is evaluating market conditions and financing alternatives to enhance its capital structure, indicating potential plans for further capital raising through debt or equity financings.

Overall, Journey Medical's financial performance reflects significant challenges, with a focus on strategic product development and financing to navigate its current situation.