Cipher Pharmaceuticals Reports Second Quarter 2025 Results, Including Record Revenue

Executive Summary

• Cipher Pharmaceuticals reported record second-quarter 2025 financial results, driven by strong performance in its U.S. Natroba™ business and continued growth in its Canadian Epuris® portfolio.
• The company achieved its highest single-quarter revenue in history, with total revenue reaching $13.4 million, representing a 152% increase year-over-year.
• Strong cash generation allowed for significant debt reduction and shareholder returns, including a $15.0 million debt repayment and $2.1 million in share repurchases during the quarter, with an additional $7.0 million debt repayment made subsequent to quarter-end.

Key Details

• Revenue Performance:
  • Total Q2 2025 revenue was $13.4 million (up 152% from $5.3 million in Q2 2024).
  • Canadian product portfolio revenue increased 12% to $4.1 million.
  • Natroba™ U.S. product revenue was $7.8 million, a 16% sequential increase from Q1 2025 ($6.7 million).
  • Licensing revenue was $1.5 million, a 9% decrease from Q2 2024.
• Profitability Metrics:
  • Total gross profit increased 159% to $10.9 million.
  • Gross margin on product revenue increased to 79% (from 70% in Q2 2024).
  • Net income was $5.9 million ($0.23 per share basic), compared to $3.0 million ($0.12 per share) in Q2 2024.
  • Adjusted EBITDA was $7.6 million, a 148% increase from $3.1 million in Q2 2024.
  • EBITDA was $8.6 million, a 290% increase from $2.2 million in Q2 2024.
• Cash Flow and Balance Sheet:
  • Cash from operations was $6.0 million in Q2 2025.
  • Cash balance at end of Q2 2025 was $11.3 million.
  • Long-term debt reduced from $40.0 million (Dec 2024) to $25.0 million (June 2025).
• Capital Allocation & Debt Repayment:
  • $15.0 million repaid on revolving credit facility during Q2 2025.
  • $2.1 million returned to shareholders via Normal Course Issuer Bid (NCIB) share repurchases (230,278 shares at avg CDN$12.74).
  • Additional $7.0 million debt repayment made on August 6, 2025, reducing outstanding balance to $18.0 million.
  • Remaining available financing: $47.0 million under revolving facility plus $25.0 million accordion option ($72.0 million total potential).
• Operational & Strategic Updates:
  • Natroba™ received preferred step-through status on Medicaid in Illinois (April 2025), downgrading competitor Permethrin 5% to non-preferred.
  • TSX approved NCIB for up to 1,485,260 shares (10% of public float) through May 4, 2026.
  • Epuris sales volumes grew 14% in Q2 2025 compared to Q2 2024.
  • Year-to-date Epuris revenue growth was 25% compared to the same period in 2024.

Notable Quotes

• Craig Mull, Interim CEO: "Cipher has continued its growth during the second quarter of 2025, with quarterly revenue achieving a historical record for the Company, largely contributed to by our U.S. business. The U.S. business, led by Natroba™, continues to exceed our expectations... The U.S. business has contributed to a more than doubling of Cipher's total revenue and Adjusted EBITDA compared to the prior year..."
• Ryan Mailling, CFO: "In Q2 2025, we had another quarter of strong cash generation... Cash generated in the second quarter, combined with previous cash accumulation, was allocated during the quarter to a $15.0 million repayment on our revolving credit facility, de-levering the business, as well as repurchases of our common shares through our normal course issuer bid ('NCIB'), which returned $2.1 million to our shareholders."