Please ensure Javascript is enabled for purposes of website accessibility

Here's Why TherapeuticsMD Fell as Much as 17.6% Today

By Maxx Chatsko - May 7, 2019 at 2:06PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The women's health company reported first-quarter 2019 operating results.

What happened

Shares of TherapeuticsMD (TXMD 3.38%) fell over 17% today after the business reported first-quarter 2019 operating results. The women's healthcare company reported $3.9 million in revenue, which lagged well behind the consensus on Wall Street expecting $5.9 million, according to five analyst estimates compiled by Yahoo! Finance

The large gap between analyst estimates and reality was driven by the launch of the company's patient savings program for its lead drug product Imvexxy. The program caps monthly prescription rates at $35 for eligible patients. TherapeuticsMD said it expects revenue to pick up as commercial payer coverage and insurance plan coverage expands.

As of 1:38 p.m. EDT, the stock had settled to a 14.5% loss.

A finger pointing to a falling chart on a screen.

Image source: Getty Images.

So what

The patient savings program was a significant factor weighing on the quarter. Consider that the business reported 75,000 Imvexxy prescriptions in Q1 2019, representing growth of 58% from Q4 2018, but revenue was 24% lower. That said, it seems a little shortsighted of Wall Street to cast a program giving patients access to therapy as a negative for the long-term health of the business.

For what it's worth, TherapeuticsMD beat Wall Street's quarterly earnings estimate by a penny with a loss of $0.16 per share despite the $2 million miss on revenue. That shows the business kept expenses in check.

The company also had a busy April. TherapeuticsMD reported 31,200 prescriptions of Imvexxy last month, closed a $300 million term loan facility, and launched another drug product, Bijuva, on the market. The recent infusion of capital will be key to supporting the continued growth of Imvexxy as well as market launches of Bijuva and a third product, Annovera.

Now what

A few broken spreadsheets on Wall Street aside, TherapeuticsMD turned in a solid start to 2019. The $950 million women's health company is flush with cash and will soon be nurturing the growth of three new drug franchises. And although the business doesn't provide guidance, the terms of the $300 million loan facility state that the last $50 million will only be dispersed if its three drug franchises achieve at least $11 million in revenue during Q4 2019. That suggests a healthy exit rate for the business and plenty of growth just ahead.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

TherapeuticsMD, Inc. Stock Quote
TherapeuticsMD, Inc.
$2.14 (3.38%) $0.07

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/28/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.