Transcript: Biofrontera Q2 2026 Earnings Conference Call

On Thursday, Biofrontera (NASDAQ: BFRI ) discussed second-quarter financial results during its earnings call. The full transcript is provided below. This content is powered APIs. For comprehensive financial data and transcripts, visit Access the full call at Summary Biofrontera Inc.

reported a 33% increase in net product revenue to $12 million and achieved an 80% gross margin, with adjusted EBITDA reaching breakeven. The company is dealing with a legal issue involving the International Trade Commission concerning its RhodoLED XL lamp but has a remediation plan in place to introduce a modified version outside the patent scope. Biofrontera is preparing for potential FDA approvals and product launches in 2027, including for superficial basal cell carcinoma and expanded indications for actinic keratosis. Sales of Ameluz are strong, with a 30% growth in unit volume and continued expansion of the customer base, despite challenges with the RhodoLED XL lamp.

The company is focused on expanding its product indications to drive future growth using its existing infrastructure, while maintaining financial discipline to address liquidity concerns. Full Transcript OPERATOR Welcome to the Biofrontera second quarter 2026 financial results and business update conference call. At this time, all participants are in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.

After today's prepared remarks, there will be an opportunity to ask questions. To ask a question, please press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded.

I would now like to turn the conference over to Ben Shamsian with Lytham Partners Investor Relations. Please go ahead. 's second quarter 2026 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 the risks and uncertainties associated with the company's business.

Forward-looking statements on today's call include statements regarding the company's full-year 2026 revenue goals; the anticipated effects of the International Trade Commission orders and the company's remediation plan; the company's liquidity and the ability to continue as a going concern; the outcome of pending patent proceedings; and the potential approval and launch of new indications for Ameluz.

All risks and uncertainties are detailed and are qualified by the cautionary statements contained in Biofrontera's press release and SEC filings, including the company's quarterly reports on Form 10-Q for the quarter ended June 30, 2026, and the company's annual report on Form 10-K for the year ended December 31, 2025. Also, this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast. 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 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 issued today and is available on the company's website at under the Investor Relations section.

Please note management will be referencing adjusted EBITDA, a non-GAAP financial measure defined as net loss excluding interest expense, net; income taxes; depreciation and amortization; and certain other non-recurring or non-cash items, including changes in fair value of warrant liabilities, panel remediation expense and the related inventory write-down, and stock-based compensation. With that said, I would now like to turn the call over to Herman Lavert, CEO, Chairman and Founder of Biofrontera. Herman, please proceed. Herman Lavert, CEO, Chairman and Founder Yes, thank you, Ben, and thank you to everyone joining us this morning.

S. business. 1 million in Q2 of last year. These strong results in Q2, which for us is traditionally a weaker quarter, are not just one quarter out of the ordinary.

They reflect the build-up of a commercial organization that is executing, along with expense discipline across the entire organization. We are seeing the pace of reorders from our physician accounts accelerate, which reflects the strength of underlying demand generation. George and Fred will take you through the details in a moment. S.

rights, approvals, and patents for the Ameluz and RhodoLED portfolio and replaced the transfer pricing model of 25% to 35% of revenue with a 12% earnout on net sales. Before diving into the business, I want to address the International Trade Commission matter because I expect it is on your minds. On May 6, the Commission issued its final determination finding a violation of Section 337 with respect to two Sun Pharmaceutical patents covering certain components of our RhodoLED XL lamp. S.

Patent and Trademark Office's Patent Trial and Appeal Board, which, in agreement with our belief, had previously found every challenged claim of one of the patents unpatentable. The Commission issued a limited exclusion order and cease and desist orders, which took effect on July 7th. We can no longer import or sell the current RhodoLED XL lamp in the United States, and we are restricted from selling Ameluz for use with the RhodoLED XL. Three things you should understand about the scope of this.

First, this affects the XL lamp. It does not in any way affect the original BF-RhodoLED lamp, which represents a substantial majority of our installed lamp base. Physicians using those lamps are unaffected, and Ameluz sales to accounts with the BF-RhodoLED lamp continue normally. Second, we have a remediation plan designed to allow selling a modified version of our XL lamp that is outside the scope of both Sun Pharmaceutical patents.

We recorded approximately 500,000 in the first quarter as our best estimate of the remediation cost, and that estimate has not changed. Because a substantial majority of our installed lamp base is unaffected, and we expect to get approval to provide a modified version of the RhodoLED XL that is outside the patent space, we expect the exclusion order to affect the timing of orders rather than total demand. Third, and finally, we are not finished contesting this. We retain the right to appeal the Commission's determination to the Federal Circuit.

I will not speculate on how those proceedings will resolve or when. What I will tell you is that while pursuing every avenue available to us, our commercial plan does not depend on winning any of them. Our commercial success will be because of our continued dedication to doctors and patients, as well as investment in developing Ameluz and PDT to be used in more indications. Now let me turn to the clinical pipeline because it is the clearest picture of how this company will grow in 2027 and beyond.

First, superficial basal cell carcinoma: the FDA accepted filing of our supplemental New Drug Application for Ameluz PDT for the treatment of superficial basal cell carcinoma, with a PDUFA target date of September 28, 2026. If approved, Ameluz will be the first PDT in the United States approved for the treatment of cancerous skin tumors, and we expect a full launch in Q1 of 2027 with initial outreach to customers during Q4 of 2026. That launch would go directly into our existing installed base of BF-RhodoLED lamps and our existing dermatology call points. The commercial infrastructure is already in place.

Second, actinic keratosis on the extremities, neck, and trunk. Earlier this year we announced positive and statistically significant top-line Phase 3 results, with the study meeting its primary endpoint. These data support our plan to file a supplemental NDA around the end of the third quarter of 2026 to expand the Ameluz label beyond AKs on the face and scalp to a treatment field of up to 240 square centimeters. We anticipate FDA approval in Q3 2027.

With approximately 58 million American adults having at least one AK lesion, extending treatment to the extremities, neck, and trunk and a larger area meaningfully expands the addressable use of every lamp already in the field. Third, moderate to severe acne and beyond. Our Phase 2b study showed a 58% reduction in inflammatory lesions with Ameluz compared to 37% with vehicle, and 86% of patients said they would choose PDT treatment again. We are currently in the process of prioritizing and designing our next phase of clinical development, aiming at expanding the addressable market for our products, and acne will be an important part of this discussion.

We'll keep you updated as these plans evolve. Taken together—sBCC expected to launch in the first quarter of 2027, relevant AK label extensions anticipated in Q3 2027, and an acne program advancing towards Phase 3—each of these will drive revenue through the same installed lamp and customer base and the same sales force we have already built and paid for. That is the growth model for 2027 and beyond: more approved uses flowing through infrastructure that is already in place. I would now like to turn the call over to George Jones, our Chief Commercial Officer.

George. George Jones, Chief Commercial Officer Thank you, Herman, and good morning, everyone. We delivered product revenues of $12 million in the second quarter, an increase of approximately 33% year over year. The increase was driven by approximately 30% growth in Ameluz unit volume together with the price increase we implemented in the fourth quarter of 2025.

Looking at unit volume in the second quarter of 2026, we sold 33,300 tubes of Ameluz. This is compared to approximately 25,300 tubes in the second quarter of 2025. Volume growth in the quarter included the impact of order timing from certain customers in anticipation of the ITC-related supply restrictions Herman described. The timing of this is good because customers tend to move through Ameluz faster when they have inventory on the shelf, and it sets us up for a strong fourth quarter.

Importantly, since the substantial majority of our installed lamp base is unaffected by the exclusion order, we do not expect this shift to impact our full year 2026 revenue goals. Turning to the RhodoLED lamp placements in Q2 2026, we placed 21 lamps including 16 XL lamps and 5 RhodoLED lamps. This increased our installed base to approximately 801 lamps across approximately 740 physician offices. Turning to sales execution, we are seeing significant traction across all aspects of our business.

6% versus the first half of 2025, and the average tubes per order was up 10%. We have also been tracking our largest customers that made large purchases prior to the price increase in Q4 of 2025. Over 81% of those customers placed additional orders during the first half of 2026, and for those that did reorder, their Ameluz volume was up 41%. This is important because it indicates our sales efforts are working and our customers are increasing their Ameluz PDT throughput within their practice.

I also want to highlight our new account growth. In the first half of 2026 we added 66 new accounts versus 69 new accounts during the first half of 2025. This slight dip is likely due to the focus on current XL customers in May and June prior to the ITC orders coming effective. Lastly, I wanted to follow up on our last call and draw attention to our inside sales efforts.

Those efforts have continued to bear fruit, generating approximately 1,070 tubes of Ameluz from white space and smaller accounts, as well as another 920 tubes from covering vacant territories in the first half of 2026. The first half of 2026 has given me great optimism regarding our commercial strategy and the way our team is delivering. This enhanced execution plus our clinical programs, including the near-term sBCC approval and launch, the upcoming label expansion filing for AKs on the extremities, neck and trunk, and the advancement of our ACNE program, give us multiple paths and great opportunities for continued growth.

With that, I'll turn the call over to Fred Leffler, our Chief Financial Officer. Fred Leffler — Chief Financial Officer Thank you, George, and good morning, everyone. I'll walk through our results for the second quarter and first half of the year ended June 30, 2026. All comparisons are to the same prior period unless otherwise noted.

A full reconciliation of GAAP to non-GAAP measures is included in the press release issued earlier today and available on our website. With that, revenues for the second quarter were $12 million compared to $9 million in the second quarter of 2025. 9%. As George described, unit volume grew approximately 30%, with the balance of the growth coming from the price increase that was completed in the fourth quarter of 2025.

6 million in 2025. 6 million and a gross profit margin of about 80% compared to approximately 71% in the prior year quarter. That's an expansion of roughly 920 basis points. For the first half, gross margin was also 80% against a gross profit margin of 67% in the first half of 2025.

The improvement was driven principally by the transition from the prior transfer pricing agreements to a cost structure comprising of Ameluz direct cost plus a 12% earnout on net revenue. That structure is contractual and durable and we will see it continue. 6 million in 2025 that we took over following the strategic transaction. I would note that the litigation-related legal spend is tied to the pace of active matters and can vary quarter to quarter.

4 million. This was driven primarily by investment, lower turnover in the commercial organization, and the new manufacturing and regulatory functions I just mentioned, and it was partially offset by lower litigation-related legal fees. 1 million for the first half of 2025, reflecting the current vintage of clinical trials reaching substantial completion. As Herman pointed out, we are planning additional clinical developments for the coming years, aiming to expand the reach of our products but depending on available funds.

57 per share, in 2025. 05 per share. 9% in 2025. 9% versus negative 54%.

4 million at December 31, 2025. 2 million a year ago. 7 million one-time pay down of related-party payables that were connected to the strategic transaction that happened in the first quarter of 2026. Including that item, changes in working capital were a net source of cash for the period.

We continue to make progress towards cash flow break-even. 1 million, essentially unchanged from year-end 2025. 6 million of convertible notes maturing in November of 2027. We have no bank or term debt.

5 million at December 31, 2025. As we have disclosed in our filings, the company has included a going concern qualification in its financial statements. While we have demonstrated meaningful progress towards cash flow break-even and believe we will achieve that this year, and this quarter is the clearest evidence of that progress, our current capital resources require us to continue expanding our commercial operations and controlling expenses.