MONTREAL - Theratechnologies (NASDAQ:THTX) Inc. (TSX: TH) (NASDAQ: THTX), a biopharmaceutical company, has announced a potential temporary supply disruption of its product EGRIFTA SV® in early 2025. This disruption is due to an unexpected shutdown of their contract manufacturer's facility after an FDA inspection. The company is working closely with the manufacturer and the FDA to resume production and is confident that patient impact will be avoided.
The shutdown, following observations by the FDA Office of Compliance not related to the drug's manufacturing process but to the facility's environment, has led to a three-month voluntary closure. The manufacturer is expected to resume activities by mid-October, with a new batch of EGRIFTA SV® scheduled for production on October 21, 2024.
To address the FDA's requirements, Theratechnologies will file a Prior Approval Supplement (PAS) around the manufacturing date. The review of a PAS typically takes four months. The company anticipates a revenue shortfall of about $1.6 million from EGRIFTA SV® for the fiscal year 2024 due to this issue but remains on track to deliver strong Adjusted EBITDA for the year.
Theratechnologies plans to manage inventory levels to meet patient demand until January 2025. Despite the anticipated impact on fourth-quarter revenues, the company expects to provide more detailed financial information in the upcoming release of its third-quarter results in October.
EGRIFTA SV® is distributed exclusively in the United States, and the company will update the market on any further significant developments. This information is based on a press release statement from Theratechnologies.
In other recent news, Target (NYSE:TGT) Hospitality (NASDAQ:TH) Corp. has updated its financial outlook for 2024 following the termination of the South Texas Family Residential Center contract. The revised outlook includes total revenue estimates between $375 and $385 million, Adjusted EBITDA projections of $184 to $190 million, and total capital spending between $25 and $30 million, excluding acquisitions. The company also anticipates achieving zero net debt by the end of 2024, with total available liquidity exceeding $350 million.
In addition to these financial updates, Target Hospitality received an unsolicited proposal from Arrow Holdings S.à r.l., affiliated with TDR Capital LLP, to acquire all outstanding shares of the company. The company's Board has established a committee to review and evaluate this proposal.
Recent developments also include Target Hospitality's first-quarter 2024 earnings report, which showed total revenue of approximately $107 million and adjusted EBITDA at around $54 million. Analyst firm Stifel has revised Target Hospitality's stock price target to $9.50, down from $12.00, maintaining a Hold rating. This change follows the termination of the company's contract with Immigration and Customs Enforcement for the South Texas Residential Family Center.
Target Hospitality is actively pursuing growth, with plans to invest over $500 million in net growth capital in the coming years. As part of its growth strategy, the company is focusing on diversifying its customer base and contract portfolio, including pursuing a third ICF site and potential federal agency contracts.
InvestingPro Insights
As Theratechnologies Inc. addresses the supply disruption of its product EGRIFTA SV®, investors and stakeholders are closely monitoring the company's financial health and market performance. According to real-time data from InvestingPro, Theratechnologies has a market capitalization of approximately $993.27 million. This places the company in a competitive position within the biopharmaceutical sector.
InvestingPro Tips reveal that Theratechnologies boasts impressive gross profit margins, with a reported 64.13% for the last twelve months as of Q2 2024. This metric highlights the company's efficiency in managing production costs relative to revenue, which is particularly relevant given the current manufacturing challenges.
Another notable aspect is the company's stock price volatility. InvestingPro Tips indicate that stock price movements for Theratechnologies have been quite volatile, which may be of interest to investors looking for short-term trading opportunities or those assessing the risk profile of their portfolio. On the brighter side, the company has experienced a strong return over the last three months, with a 24.24% price total return, reflecting positive investor sentiment during that period.
Despite the expected revenue shortfall due to the supply disruption, Theratechnologies is trading at a low earnings multiple, with a P/E ratio of 8.18 and an adjusted P/E ratio of 7.86 for the last twelve months as of Q2 2024. This indicates that the company's earnings are priced modestly in the market, which could attract value investors.
For those seeking a deeper analysis, InvestingPro offers additional insights and tips. There are currently 11 more InvestingPro Tips available for Theratechnologies, providing a comprehensive view of the company's financial outlook and stock performance. To access these valuable insights, visit the dedicated section on InvestingPro for Theratechnologies: https://www.investing.com/pro/THTX.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.