Pelthos Therapeutics (AMEX:PTHS) held its second-quarter earnings conference call on Thursday. Below is the complete transcript from the call.
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Summary
Pelthos Therapeutics reported substantial revenue growth in Q2 2026, with net product revenue increasing from $10.7 million in Q1 to $15.4 million, driven by a 48% increase in prescription units for their lead product, Zelsuvmi.
The company made strategic progress with contracts with a major pharmacy benefit manager, increasing the distribution of Zelsuvmi, and is preparing for the launch of two complementary products, Zeppi and Zeglaise, in 2027.
Pelthos plans to leverage existing commercial infrastructure for the upcoming launches and expects to maintain strong growth, supported by high Medicaid coverage and positive feedback from healthcare professionals.
Full Transcript
OPERATOR
Greetings and welcome to the Q2 2026 Pelthos Therapeutics conference call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone requires operator assistance during the conference, please press star 0 on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mike Moyer of LifeSci Advisors. You may begin.
Mike Moyer, LifeSci Advisors
Good morning, everyone, and welcome to Pelthos Therapeutics' 2026 second quarter financial results conference call. Pelthos issued a press release today announcing its financial results for the quarter ended June 30, 2026. A copy can be found in the Investor Relations tab on the company's corporate website at www.pelthos.com. Before we begin, I'd like to remind you that during today's call, statements about the company's future expectations, projections, plans, and prospects are forward-looking statements.
These forward-looking statements are based on management's current expectations. These statements are neither promises nor guarantees and involve known and unknown risks, uncertainties, and other important factors that may cause the company's actual results, performance, or achievements to be materially different from the company's current expectations expressed or implied by the forward-looking statements. Any such forward-looking statements represent management's estimates as of the date of this conference call.
While the company may elect to update such forward-looking statements at some point in the future, it disclaims any obligation to do so even if subsequent events cause its views to change. As a reminder, this conference call is being recorded and will remain available for 90 days. I'd now like to turn the call over to Scott Plesha, Chief Executive Officer. Scott, you may begin.
Scott Plesha, Chief Executive Officer
Thank you, Mike, and good morning, everyone. We're delighted to be with you today and share with you our second quarter 2026 operating results and highlights. Joining me today are John Gay, our Chief Financial Officer, and Cy Rangero, our Chief Commercial Officer. The second quarter of 2026 was a successful one for Pelthos with strong execution and progress made in several key areas that I'll share at a high level with you. First, we experienced substantial revenue growth driven by increased prescriptions of our lead product, Zelsuvmi, in this fourth quarter since launch.
Next, the contracts we executed with a major pharmacy benefit manager at the end of last year have been an important catalyst in demand for Zelsuvmi. Within this PBM, units dispensed increased 81.3% during the quarter, while the number of prescribers increased 68%. We continue to explore additional contracting options to further our reach and market penetration. Finally, we continue to make progress in establishing the manufacturing of our two other highly complementary products, Zeppi and Zeglaise.
John and Cy will provide a more detailed look at the quarter's Zelsuvmi launch metrics and reported financial results, but I'd like to share a brief overview of our results of operations. Our top-line results were driven by a 48% increase in prescription units as reported by Symphony Health, which increased from 8,084 units in the first quarter of 2026 to 11,925 units in the second quarter of 2026. This drove an increase in net product revenue from 10.7 million during the first quarter of 2026 to 15.4 million in the second quarter of 2026.
Importantly, we achieved this growth with only a minimal increase in wholesale inventory while reducing days on hand by approximately three days from the end of Q1 2026 to the end of Q2 2026. As a reminder, Zelsuvmi is a novel topical nitric oxide–releasing product indicated for the treatment of molluscum contagiosum, or MC, in patients 1 year of age and older for up to 12 weeks. Zelsuvmi is an important advancement in the treatment of MC as it's the first and only FDA-approved therapy that can be applied by parents, patients, or caregivers in the home or on the go.
We believe the opportunity to treat MC at home and without the need for an in-office procedure has been and will continue to be a key driver of Zelsuvmi demand. We are pleased with the growth delivered in Q2 and are confident in our future performance. Our belief remains strong that Zelsuvmi is revolutionizing the treatment of MC, is becoming the first-line treatment of choice for many HCPs and patients. This is supported by the recent August 2026 Journal of Drugs in Dermatology publication titled "Molluscum Contagiosum in the Pediatric Expert Consensus Guidance on Prevention and Treatment," which includes berdazimer 10.3% gel as the only at-home available treatment option for MC that can provide clinically meaningful clearance rates and, when combined with supportive management, provides an opportunity to improve outcomes and quality of life for children with MC. These landmark guidelines represent a significant advancement in the management of MC, and we're committed to ensuring they are appropriately communicated to healthcare professionals who treat MC. Regarding Zeppi and Zeglaise, Zeppi is a novel FDA-approved topical treatment for impetigo that addresses a critical unmet need in antibiotic-resistant skin infections caused by staph and strep infections most commonly affecting children.
Impetigo is the most common skin infection in children seen by pediatricians, with approximately 3 million patients diagnosed with this bacterial infection each year. We believe Zeppi is a highly complementary product as it mostly treats children that are managed by the same healthcare providers as Zelsuvmi. Importantly, this allows us to leverage our commercial infrastructure, including our expanded sales force. We continue to focus on establishing the manufacturing process and building launch inventory and expect to launch Zeppi in the first quarter of 2027.
With respect to Zeglaise, Zeglaise is a novel FDA-approved product indicated for the treatment of head lice in patients 6 months of age or older that is highly complementary to Zelsuvmi and Zeppi and is expected to require minimal incremental overhead to commercialize. At the operational level, we are standing up manufacturing for Zeglaise and expect to bring it to market in the third quarter of 2027. Both Zeppi and Zeglaise will have meaningful call overlap for our existing sales force, providing the company with greater operational and financial leverage from our existing team and infrastructure.
In summary, we are pleased with the strong response from healthcare professionals to Zelsuvmi as demonstrated by the more than 30,000 units dispensed since its launch in July of 2025. We continue to plan for the upcoming launches of Zeppi and Zeglaise, two complementary FDA-approved products. We'll continue to evaluate and optimize our commercial strategy to drive sustainable long-term shareholder value. I'll now turn it over to Cy to provide more specifics on the results of the Zelsuvmi launch and key performance indicators.
Cy Rangero (Chief Commercial Officer)
Thank you, Scott. Good morning, everyone. I'm pleased to provide an update on our Q2 2026 Zelsuvmi performance. Our progress to date continues to deliver better-than-expected results in our first full year, or four full quarters since launch, for Q2 2026. Shipments and prescriptions continue to track ahead of expectations. We also continue to receive very positive feedback from several prescribers regarding the Zelsuvmi clinical profile and ease of use.
We now have more than 8,000 unique HCP prescribers in our latest data. We remain confident that Zelsuvmi is revolutionizing the treatment of MC, as evidenced by the increased utilization of Zelsuvmi in the first full year. Since its commercial launch in July 2025, more than 25,000 patients have been prescribed Zelsuvmi. This is an incredible milestone for Zelsuvmi and Pelthos Therapeutics. Getting into the prescription details for Q2 2026, the number of prescriptions rose a very strong 48% from 8,084 in Q1 to 11,925 prescribed units in Q2.
The number of unique prescribers also rose from 3,288 in the first quarter to 4,571 by the end of the second quarter, with both sets of data reported in Symphony's Metis data. Prescribed units in July were 4,299 versus 4,208 in June, with typical seasonality in summer. Scheduling dynamics for HCPs and patients' performance between June and July was in line with our expectations. We continue to feel confident about our growth potential in Q3. We also continue to see weekly highs in prescribed units, with our latest data for the week ending July 31st reaching an all-time high of more than 1,000 units dispensed of Zelsuvmi.
Our coverage for Zelsuvmi remains strong in 2026. As of today, we have a 59% coverage rate for commercial insurance plans and an incredible 100% coverage rate for Medicaid. This is a testament to the fact that Zelsuvmi, as the first FDA-approved at-home treatment for MC, is being adopted as a first-line treatment option and is being well received by HCPs and coverage providers. As previously announced, we executed a contract with a large PBM to remove friction and help patients gain access to Zelsuvmi.
This effort has continued to help many patients gain rapid access to Zelsuvmi for Medicaid coverage. A number of larger states still do not require a prior authorization. In other states that require a PA, Medicaid only requires a prior authorization written to label, meaning that a patient over one year of age presenting with MC qualifies for coverage. We continue to have very good gross-to-nets, or GTNs. Our current GTNs are driven by distribution costs, Medicaid discounts, payer contracts, and our copay voucher program.
It is our goal to offset prescription costs through the copay card program so that the prescription cost is $0 or close to zero for the majority of patients in most instances. For the second quarter of 2026, we had favorable GTNs of 29.6%, in line with our expectations. Going forward, we expect our GTNs to move into the mid-30% range. In Q2 2026, we made three key additions to our sales team footprint with the launch of territories in Pittsburgh, Pennsylvania; Albany, New York; and Shreveport, Louisiana. These strategic additions bring our field force to 67 sales territories, further strengthening our reach and positioning us to deliver impactful Zelsuvmi education and awareness to a broad and growing community of healthcare professionals. Our awareness and utilization of Zelsuvmi as the first and only at-home prescription treatment option for MC are heavily complemented by our comprehensive promotional tactics.
Our Zelsuvmi YouTube commercial and our patient testimonial videos featuring a young patient and a renowned pediatric dermatologist continue to be highly educational and successful, with more than 9.2 million total views of the Zelsuvmi YouTube commercial and more than 400,000 views of our patient testimonial videos. These unique and informative short-form videos have prompted parents and caregivers, along with adult patients, to ask their HCPs about Zelsuvmi and the potential for appropriately utilizing the treatment for their MC.
To further strengthen our digital outreach, in June we launched a new series of HCP-focused YouTube videos featuring expert clinicians sharing their experiences with MC and their perspectives on Zelsuvmi as an important treatment option for appropriate patients. This video series, along with the content to follow, provides HCPs with concise, expert-driven insights that help them quickly understand the meaningful benefits that Zelsuvmi can offer to appropriate patients.
Throughout Q2 2026, we participated in several key conferences, engaging with and educating HCPs on the differentiated benefits of Zelsuvmi for their patients. Our presence and presentations at the Society of Pediatric Dermatology and one of the largest Nurse Practitioner/Physician Assistant dermatology conferences generated significant attention and a strong volume of HCP leads. These engagements translated into meaningful interest in both continued and new use of Zelsuvmi, reinforcing the growing momentum and awareness of the brand among HCPs.
We continue to build on our great tactical platform, along with the strong execution of our sales team, to grow Zelsuvmi. I am very proud of our strong performance to date, which reflects the passion, dedication, and hard work of our exceptional commercial team, and with that I now turn the call over to John to discuss our financials.
John Gay, Chief Financial Officer
Thank you, Cy. Good morning, everyone, and thank you for joining us on today's call. As Scott and Cy have already touched on, we continue to see increasing demand for our lead product Zelsuvmi, as demonstrated with our growing pull-through and dispensed units to date. Before I speak to the financial results for our second quarter 2026, I would like to explain in more detail two filings Pelthos Therapeutics made this morning with the SEC regarding the complex U.S. GAAP accounting matter specifically associated with the fair value accounting of our related party Convertible Notes. I would encourage investors to review the Company's current report on Form 8-K and Amendment No. 1 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2026, each of which was filed with the SEC earlier today and contains additional information regarding this restatement and the related accounting analysis.
The following activity this morning associated with the first quarter of 2026 resulted from a misapplication of Accounting Standards Codification 820, Fair Value Measurement, related to certain fair value measurements used in estimating the fair value of our convertible debt, including valuation methodologies, specific valuation assumptions, and inputs. Specifically, this matter related to the valuation impact of certain provisions in the Convertible Note Subordination Agreement entered into in January 2026 by the convertible note holders as part of the Horizon Technology Finance term loan facility closed in January of 2026.
A subordination agreement was executed by the convertible note holders pursuant to this agreement. All payment obligations under the convertible notes, including principal and accrued interest, became subordinated to the Company's obligations under the Horizon term loans. The valuation issue stemmed from the effect of this subordination agreement and its impact on the fair value measurement of the Company's convertible debt. The valuation assumptions and methodologies used in the Company's originally filed Form 10-Q for the quarter ended March 31, 2026 did not appropriately reflect the impact of the subordination agreement in accordance with ASC 820, Fair Value Measurement. As a result, the Company restated its previously issued financial statements for the quarter ended March 31, 2026 to revise certain fair value measurements associated with its convertible debt. The amended Q1 2026 filing reflects the revised fair value measurements and related accounting adjustments associated with the subordination agreement in accordance with ASC 820. The restatement is limited to fair value accounting measurements associated with the Company's convertible debt and related accounts and does not affect the underlying economics of the Company's convertible debt arrangements.
In summary on this matter, I would like to emphasize that the restatement relates solely to fair value accounting estimates. It does not affect the Company's cash balances, net revenues, product sales, operating expenses, operating loss, operating cash flows, or adjusted EBITDA. With that, I will now focus on the operating results of our commercial business. Please note that my comments will focus on our second quarter 2026 results as compared to the first quarter of 2026.
For the second quarter of 2026, we reported $15.4 million of net product revenue, representing a 45% increase from the first quarter of 2026. With today's filing of our Quarterly Report on Form 10-Q for the period ended June 30, 2026, we have now completed and reported four fiscal quarters of commercialization efforts for Zelsuvmi. While these quarters straddle two fiscal years, we have reported in aggregate $42.3 million of net product revenue for the four quarters since commercial launch.
This amount is comprised of our net product revenue from the third and fourth quarters of fiscal 2025 of $7.1 million and $9.1 million, plus $10.7 million and $15.4 million of net product revenue for the first and second quarters of 2026, respectively. Cost of goods sold was $3.6 million for the second quarter 2026 and $1.7 million in the first quarter 2026. Cost of goods sold includes fair value adjustments related to finished goods and active pharmaceutical ingredient (API) inventory on hand at the time of the Company's merger in July 2025.
Cost of goods sold for the second quarter of 2026 also includes a $0.9 million write-off of commercial API inventory identified through the Company's quality control processes related to out-of-spec testing results for API manufactured during the quarter. The underlying procedural cause of this matter was addressed, and subsequent API manufacturing has commenced and is meeting specifications. In addition, as previously discussed, a component of our cost of goods sold includes fair value adjustments associated with the July 2025 merger.
At the time of the merger, all finished goods and active pharmaceutical ingredient inventory on hand was fair valued as prescribed under U.S. GAAP. As of the end of the second quarter of 2026, we have sold through the stepped-up finished goods inventory, and we expect to consume the remaining stepped-up API inventory within the next 12 to 15 months. Once we have sold all inventory with a basis step-up, we expect to have a normalized per-unit cost of goods of approximately a mid–single-digit percentage of our current WAC price.
For the second quarter of 2026, we reported $27.7 million of SG&A expenses, representing a 31% increase from the first quarter of 2026 at $21.1 million. We provide a detailed breakdown of the components of SG&A within the MD&A section of our Quarterly Report on Form 10-Q for the period ended June 30, 2026 filed this morning, but in summary, the $6.6 million quarter-over-quarter change in SG&A was primarily related to an expected $5.3 million increase in one-time, non-recurring sales-based milestone related to our Zelsuvmi license; an increase in royalties owed of $0.8 million; an increase in personnel costs of $1.3 million, which includes $0.5 million of cash-based severance payments and $1.0 million of non-cash stock-based compensation related to a former executive; a decrease in regulatory and manufacturing-related expense of $0.8 million; an increase in corporate expenses of $0.7 million; a decrease in marketing and commercial expense of $0.5 million; and a decrease in non-cash depreciation expense of $0.2 million.
Total cash-basis SG&A, excluding milestones, royalties, and severance, was approximately $16.2 million for the second quarter of 2026 as compared to $16.7 million for the first quarter of 2026. We expect that quarterly cash-basis SG&A, excluding milestones, royalties, and severance, will fluctuate in 2026 as we continue to invest in the expected and as we prepare ZEPI and ZEG Labs for commercialization. Net loss for the second quarter of 2026 was $23.4 million as compared to $25.1 million of net loss for the first quarter of 2026.
As amended, adjusted EBITDA for the second quarter of 2026 was negative $5.7 million as compared to negative $8.0 million in the first quarter of 2026. Turning now to our balance sheet, as of June 30, 2026 we had $24.2 million of cash and $14.5 million in accounts receivable. Our working capital at the end of the second quarter of 2026 was $31.4 million as compared to $44.8 million at the end of the first quarter of 2026. As previously discussed, in January this year we entered into a $50 million senior secured term loan facility, of which we drew $30 million at close, with Horizon.
Based on the Company achieving trailing twelve-month net product revenues of $42.3 million as of June 30, 2026, the Company understands it has achieved access to an additional $10 million under the term loan facility, subject to the lender's discretion. Based on current projections, including forecasted cash flows related to net product sales of Zelsuvmi and proceeds from the initial draw of the Horizon facility, we believe we have the capital and flexibility needed to advance and execute our business plans.
In summary, our performance since the launch of Zelsuvmi in July 2025 has exceeded our expectations. Furthermore, since launch, we have strengthened our balance sheet and believe we are well positioned to continue our commercial execution story, bringing a much-needed treatment to Baluskin patients. With that, I'll now turn it back over to Scott.
Scott Plesha, Chief Executive Officer
Thank you, John. In closing, I would now like to highlight a few key points. To begin, we are extremely pleased with the success of the Zelsuvmi launch and our financial results to date. As we remain relatively early in our launch, we have not yet provided discrete revenue and earnings guidance. However, we remain confident about our revenue growth trajectory and believe that our current cash balance provides a runway to execute our business plan.
I want to thank you for joining us today to learn more about the Pelthos Therapeutics story, and I will turn the call over to the operator for any questions.
OPERATOR
Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press star-one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star-two if you'd like to remove your question from the queue. We ask to please limit one question and one follow-up. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.
Thank you. Our first question comes from the line of David Amsalom with Piper Sandler. Please go ahead.
Keanu, Analyst at Piper Sandler
Hi, this is Keanu. David, thank you for taking our question. First, as we look toward the second half of the year, you've in the past cited a seasonal dip in claims in 3Q relative to 2Q. Any early indications on how pronounced that step down in claims might look this quarter? That's number one. And number two, regarding BD, what is your current appetite for adding an additional asset to the portfolio, and are you casting a wider net in the peds space, or do you continue to favor derm assets?
Thank you.
Scott Plesha, Chief Executive Officer
Okay, yeah, thank you for the question. I'll let Cy talk a little bit about your first question, then I'll address the second.
Cy Rangero (Chief Commercial Officer)
Good morning. Thanks for the question. In terms of claims relative to Q3, our early indicators tell us that it's actually going to be quite stable—stable compared to where we are in Q2. We do see more of the global data sphere that tells us that you see a natural decline in the quarter, as we've stated previously. But the early weeks here into Q3 really show a positive increase in what we see in terms of overall MC claims and patients utilizing Zelsuvmi.
So we feel that that's promising for the quarter, but again, in line with our expectations.
Scott Plesha, Chief Executive Officer
Yeah, and I'll take the second question around BD. You know, right now, obviously we're really busy with our launch—we're about one year in with Zelsuvmi—preparing for ZEPI and ZEG Labs, but we'll continue to evaluate other opportunities. I think, you know, critically for us, we're wanting to make sure that they align with our current assets, meaning that we have very novel, actual NCEs that are meaningful and meet kind of a need in the market that hasn't been addressed—so something that would fit in that.
Not really looking to get into like a me-too type marketplace at this time. And regarding whether it would be peds or derm, I think ideally it'd overlap in both, but if we found something compelling enough in one specialty or the other, I think we would consider it.
Keanu, Analyst at Piper Sandler
Got it. Thank you.
Scott Plesha, Chief Executive Officer
Thank you.
OPERATOR
Your next question comes from the line of Olivia Breyer with Cantor. Please go ahead.
Olivia Breyer, Analyst
Hi, good morning guys, and congrats on the quarter. Can you maybe talk about how you expect gross-to-net trends to evolve over the coming quarters and when you actually expect to start to hit that steady state in the mid-30s range? And then, as for the trends that we saw so far throughout the summer, has there been any anecdotal feedback on what's been driving some of that weekly scrips choppiness? I guess I'm just trying to get a better gauge for whether we might be out of that weekly volatility, especially now that kids are heading back to school.
Thanks so much.
Scott Plesha, Chief Executive Officer
So let me—I'll take—thanks, Olivia. I'll take the GTN question really quick. So we reported 29.6, which is quite good, especially in dermatology. And in Q1 it was 29.1. So we're up a half a point. In the past, obviously, we've guided that we think we're going to go to the low to mid-30s here later in the year. And when we do that, we're actually giving room for a potential plan to be added. So, you know, we're in discussions with a plan that we would like to have a contract with going forward.
We'll see if that happens or not. It is one of the areas where we have friction, so we'll see if we can get that done. That would cause the rates to move to the mid- to high-30s. I think without that plan we'll be more in the low-30s. We're only up a half a point this quarter, so I think still, again, very attractive, and I do think, barring any other contracts or us wanting to do anything else, that kind of low- to mid-30s will be where we live going forward.
And then I'll turn it over to Cy for the second question on the volatility.
Cy Rangero (Chief Commercial Officer)
Thanks, Scott. Good morning, Olivia. Thanks for the questions. So in terms of overall volatility that we've seen over the last several weeks, I think a lot of it's tied to, as we had stated previously, the expected summer schedules, especially in the HCP offices as well as the patients themselves coming in, and with being out of school and vacation schedules, I think you see that affecting an acute marketplace in which we're marketing within. What we do see, however, is an uptick in overall claims and obviously utilization of ZELSUVMI, where we had our highest week, just as we stated from our previous week's data.
And as it relates to back to school, we really do feel like there is going to be an influx of patients back in for traditional wellness checks and then the natural tie to potentially serving their molluscum diagnosis. That obviously is going to vary depending upon where you are geographically, meaning some regions will be getting back to school a little sooner than others, but we do expect that to normalize here in the coming weeks. Again, I think we feel pretty confident based on what we've seen here in the last couple of weeks in particular in terms of overall utilization.
Scott Plesha, Chief Executive Officer
Yeah, I'd just add, Olivia—this is Scott—I think a holiday like July 4th impacted—the Fourth was on a Friday—impacted that week, the week ending the Fourth, and the next week because people were taking long weekends and maybe a vacation the next week. So, you know, Cy mentioned us being an acute drug, and we're really dependent on NRx's coming in. Though our refills have actually gone up quite a bit in Q2; as a quarter-over-quarter percentage-wise, they were up greatly—almost doubled.
And so when you think about the impact of a holiday, it's much greater in a market like this. And then even the week that kids go back to school, they're not going to the doctor that week, right? So there is a little choppiness right now as well. We expect to grow quarter over quarter nonetheless. We grew in July over June, even though there was a holiday in July.
Olivia Breyer, Analyst
Okay, great. Thank you both. Very helpful color.
Scott Plesha, Chief Executive Officer
Thanks, Olivia.
Cy Rangero (Chief Commercial Officer)
Appreciate it.
OPERATOR
Your next question comes from the line of Brandon Folks with H.C. Wainwright. Please go ahead.
Brandon Folks, Analyst at H.C. Wainwright
Hi, thanks for taking my question, and congrats on the progress. Just following on from the earlier question, you talked about the back-to-school wellness checks. So just following on that theme, as ZELSUVMI continues to grow, can you talk about pediatrician awareness of the product and the willingness to treat—the willingness of pediatricians to treat? Are you seeing an increase in both awareness and willingness to treat from a pediatrician perspective?
Thank you.
Cy Rangero (Chief Commercial Officer)
Good morning, Brandon, and thanks for the question. Yes, I do believe we are seeing an increased awareness in the space, largely prompted through what our field force has been doing as we call on an equal amount of pediatricians compared to a traditional dermatology segment. So we do see an increase of the urgency to treat. We see an increase in the utilization of ZELSUVMI in that category. We're still hovering in that 25% to 27% range of pediatric utilization and prescribing of the product, so we feel very confident that that will increase over time.
We have a lot of other tools that we are using to get out there as it relates to non-personal and digital promotions and then being at the conferences. The pediatric community definitely does not have as many conferences as the dermatology community, but we will surely be at the ones that make the most sense in order to get the word out and again increase that awareness of, and ultimate utilization.
Scott Plesha, Chief Executive Officer
Yeah. And Brandon—hi, it's Scott—thanks for the question. Just a little bit to add there. We're seeing growth across all specialties. Two of the metrics that we really like as we look at our performance is that we're adding anywhere from 150 to 200 new prescribers each week. Cy mentioned that we're over 8,000 now prescribers at year-end, so quite good there—but not just new, repeat continue to grow as well over time. It's trending in the right direction.
And mentioning peds, I think in my comments I mentioned the new consensus guidelines that were just published, and that was led by Nanette Silverberg, who's really one of, if not the top, KOLs in the world for molluscum. We think that's going to be a great educational tool going forward for peds that maybe aren't treating or aren't treating as much as they probably should. I think it's pretty compelling. It's very balanced and fair, and that panel was comprised of some of the top pediatric derms again in the world and a top-tier pediatrician as well.
As you can imagine, that will get a lot of play—posters and whatnot—or podiums at the different talks, including the pediatric ones.
OPERATOR
Your next question comes from the line of Jeff Jones with Oppenheimer.
Mira Ahn, Analyst at Oppenheimer (for Jeff Jones)
Hi, this is Mira Ahn for Jeff. Thank you for taking our questions. Just had two questions. I wanted to ask more about how you anticipate the scrips trend to trend into the fall and how we should think about that seasonality in the second half of the year. And then my second one is what investments and gating items you think will be required ahead of the Zeppy and Zeg Ice launches next year? Thank you.
Cy Rangero (Chief Commercial Officer)
Good morning, Mira. I'll take the first question, and thanks for the question. In terms of our expectations, as I shared earlier, as it ties to seasonality and the overall claims that we've seen in Q2 and that we expect here in Q3, I think it'll still be very much in line with our expectations. And again, as we've stated now, the overall sequence of getting back into school should bode well for us, as we're positioned both with our field force and then our other promotional mechanisms to essentially attend to the needs of the quarter.
But again, in terms of our overall expectations, very much in line with what we would see as per expected claims.
Scott Plesha, Chief Executive Officer
Yeah, and I'll talk about the launches of the other products. Again, one of the reasons we really like these acquisitions is we really have our commercial infrastructure in place and we're just going to leverage it. So it's really more about the marketing side and the manufacturing side. These won't have the same marketing budget that ZELSUVMI has. Right now we're looking at probably a March of 2027 launch for Zeppy. We've actually made commercial product and are going through the different testing that needs to be done, and then we need an FDA approval because there was a change in manufacturer sites here.
It aligns really well with the national sales meeting if we do that. We decided to make sure that we get everything done and we're able to train and launch properly instead of trying to do kind of a soft launch there. So it'll be a minimal spend around it because of the synergies. And then Zegwise—right now we're again just ramping up manufacturing. It starts a little bit sooner in the process, so we're working on API right now. Really it's mostly manufacturing probably until almost middle of next year before we start really investing in Zegwise spend.
Mira Ahn, Analyst at Oppenheimer (for Jeff Jones)
Thank you so much.
Scott Plesha, Chief Executive Officer
Yep, thank you.
OPERATOR
Your next question comes from the line of Thomas Flatten with Lake Street. Please go ahead.
Thomas Flatten, Analyst at Lake Street
Hey, good morning. Thanks for taking the questions. Just a quick one for John. You mentioned the stepped-up inventory and you need to sell that through until gross margins come back to maybe more of a normalized level. Do you know how long that will take to burn through that inventory?
John Gay, Chief Financial Officer
Yeah, thanks, Thomas. Appreciate the question. As it relates to the finished-basis stepped-up—from the finished good inventory—we've actually sold through all of that. What we did have on hand from an API standpoint that also had a basis step-up, we will continue to convert that into finished good products, and we think that we'll burn through that in the next 12 to 15 months.
Scott Plesha, Chief Executive Officer
Yeah, it'll be Cy's job to speed that up if possible.
Thomas Flatten, Analyst at Lake Street
And speaking of which, what can you tell us about the number of touches that you need with the docs before they write their first prescription? Has that changed since launch? Is there a differential between peds and derms? Any kind of color on that would be super helpful.
Cy Rangero (Chief Commercial Officer)
Yeah, I'll take that question, Thomas, and good morning. It's a great question because I think when you get to a steady state—or a steadier state, rather—you do see the need for fewer touch points. I think that's indicative of our repeat writers that we have. This last week we hit an all-time high of repeat writers of 193. We have a situation where we have a really important element and a view of the need to tie back to the validation of the clinical profile and then overall tying back as well to the repeat utilization, as we also see with refills.
And, as Scott had mentioned, we've seen an 82% quarter-over-quarter increase in refills. As I was mentioning, as it ties to the refill mechanisms, that 193 was the refill count specifically; the HCP writer count is at 157 at an all-time high in our previous week. So we really do see constant validation of that repeat writer and overall view of refills as well, which I think decreases the amount of need for attention and frequency at times.
Thomas Flatten, Analyst at Lake Street
Got it. Thank you.
Scott Plesha, Chief Executive Officer
Thanks, Thomas.
OPERATOR
Your next question comes from the line of James Molloy with Alliance Global Partners. Please go ahead.
Matt, Analyst at Alliance Global Partners (for James Molloy)
Hi, guys. Matt on for Jim this morning. Thanks for taking our questions, and congrats on the progress this Q. Could you give us a bit of an overview on your view of the relative strength of YCANTH recently, as well as what counter-detailing messages you guys and they are using against each other out in the field? Thanks.
Cy Rangero (Chief Commercial Officer)
Good morning, Matt. This is Cy. I'll take that question. So just to be pretty straightforward about it, we don't ever get into a situation where we do any actual counter-detailing. We stay very firm to our clinical profile, for which we feel incredibly confident, and in terms of our overall approved messaging. So there's never a situation where we either train or suggest any level of counter-detailing. We exist in a very fortunate market in the sense that we're the first and only at-home treatment prescription option.
There's never been that type of option to date. The other products that exist in the procedural space have their own category, but by virtue of what we go to market with and what we sell every day, in terms of the overall HCP category, very, very closely tied to our clinical profile, our efficacy story, our safety story, and overall access to the medication.
Matt, Analyst at Alliance Global Partners (for James Molloy)
Got it. And any commentary on the relative strength of Wycans in the script world recently?
Scott Plesha, Chief Executive Officer
Yeah, I mean, obviously we see where they're going. I think, like I said, there's room for both of us. I think you could compare our results and decide which revenue is growing faster. But, you know, I think they're used in different patients, different offices. Sometimes there is some overlap in doctors using both. So, honestly, I would ask you to ask them about their growth. It's really about us growing our own business. That's what we're focused on.
Matt, Analyst at Alliance Global Partners (for James Molloy)
All right, great. Thanks for taking our questions.
OPERATOR
Your last question comes from the line of Jonathan Ashoff with Roth Capital Partners LLC. Please go ahead.
Jonathan Ashoff, Analyst at Roth Capital Partners
Thank you. Congrats on a nice quarter. How much of the 2Q revenue represents units versus channel fill?
John Gay, Chief Financial Officer
Yeah, so, Jonathan, in my script I shared, we actually pulled our days on hand down by three days. I'm sorry, which is under three weeks in the channel at this point, and only up a couple hundred units, basically, of inventory. So very minimal.
Jonathan Ashoff, Analyst at Roth Capital Partners
Okay, thanks. And you mentioned 67 sales territories. Is that because you hired three more people? You know, 50 plus 14. Did you add three? Okay. And what were those geographies? You kind of rambled them off pretty fast.
Cy Rangero (Chief Commercial Officer)
Good morning, Jonathan. It's Pittsburgh, Pennsylvania. It's Shreveport, Louisiana, and Albany, New York.
Jonathan Ashoff, Analyst at Roth Capital Partners
Thank you very much, guys.
Cy Rangero (Chief Commercial Officer)
Thank you.
Scott Plesha, Chief Executive Officer
Thanks, Jonathan.
OPERATOR
This now concludes our question and answer session. I would like to turn the floor back over to Scott Plesha for closing comments.
Scott Plesha, Chief Executive Officer
Thank you, operator. I want to thank everyone for joining today's call. I'd also like to thank the Pelthos employees for their continued focus, execution, hard work, and dedication in supporting patients, caregivers, and healthcare providers. Thank you again for joining our call, and we look forward to updating you on our progress in the future. Have a great day.
OPERATOR
Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. You may disconnect your lines and have a wonderful day.
Disclaimer: This transcript is provided for informational purposes only. While we strive for accuracy, there may be errors or omissions in this automated transcription. For official company statements and financial information, please refer to the company's SEC filings and official press releases. Corporate participants' and analysts' statements reflect their views as of the date of this call and are subject to change without notice.
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