Quince Therapeutics, Inc.

Cornerstone reported Q3 2013 net revenues of $53.7 million, up 43% from $37.5 million in Q3 2012. GAAP diluted EPS was $0.31 versus $0.05 a year ago, and non-GAAP diluted EPS was $0.46 versus $0.19. Gross margin was 76%, up from 62% in the prior-year quarter. Product detail: CARDENE net sales were $20.7 million versus $12.8 million, CUROSURF was $11.2 million, ZYFLO family sales were $19.8 million, PERTZYE revenue was $620,000, and the generic Tussionex launch contributed $246,000. SG&A was $16.4 million and R&D was $594,000. Cash and cash equivalents were $69.6 million, up $13.4 million from December 31, 2012. No formal next-quarter or full-year revenue/EPS guidance was given, but management said it expects BETHKIS to launch later this year, believes it is on track to finalize first RETAVASE batches in February 2014, and is targeting a RETAVASE relaunch in late 2015.

Craig Collard described the quarter as another success, emphasizing record revenue for the third consecutive quarter and saying the company’s focus on hospital and adjacent specialty markets has “truly transformed” the business. He highlighted continued strength across the marketed products, progress on PERTZYE and the generic Tussionex launch, and said Cornerstone is “well on our way” to adding 3 new therapies this year. His tone was confident and execution-focused, with repeated emphasis on strategy, product launches, and pipeline progress.

Alastair McEwan said the quarter delivered strong top- and bottom-line growth plus cash generation. He pointed to net revenue of $53.7 million, gross margin of 76% versus 62% last year, net income of $9.6 million, and non-GAAP net income of $14.3 million. He also broke out drivers: CARDENE benefited from generic shortages and supply, CUROSURF grew on volume, ZYFLO rose on price increases, SG&A increased to $16.4 million due to legal fees, employee costs, and launch-related spending, and cash ended at $69.6 million, up $13.4 million from year-end 2012.

There was no Q&A, as the operator said there were no further questions. The closest management got to anticipated investor concerns was around CARDENE, where they said sales would eventually normalize but they had no visibility into when generic shortages would end. They also noted legal and regulatory uncertainty around CARDENE patent litigation, LIXAR’s FDA meeting on December 5, 2013, and the Chiesi merger process, but declined to discuss the merger in detail.