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1. Company Snapshot

1.a. Company Description

Verrica Pharmaceuticals Inc., a dermatology therapeutics company, develops and commercializes treatments for people with skin diseases in the United States.The company's lead product candidate includes VP-102 for the treatment of molluscum contagiosum; that has completed Phase II clinical trial for the treatment of external genital warts; and which is in Phase II clinical trial for treating common warts.It is also developing cantharidin-based product candidate, VP-103 for treating plantar warts.


The company has a license and collaboration agreement with Torii Pharmaceutical Co., Ltd.for the development and commercialization of its product candidates for the treatment of molluscum contagiosum and common warts in Japan, including VP-102; and a license agreement with Lytix Biopharma AS to develop and commercialize LTX-315 for dermatological oncology indications.Verrica Pharmaceuticals Inc.


was incorporated in 2013 and is headquartered in West Chester, Pennsylvania.

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1.b. Last Insights on VRCA

The recent 3-month performance of Verrica Pharmaceuticals Inc. was negatively impacted by the company's Q4 2024 earnings release, which reported a loss of $0.24 per share, lagging revenue estimates. The company's sequential growth in YCANTH dispensed applicator units of 12.3% in Q4'24 was offset by significantly lower operating expenses. Additionally, the company's recent appointments of new board members, including Gavin Corcoran, M.D. and Noah L. Rosenberg, M.D. as Chief Medical Officer, may not have had a significant impact on the company's short-term performance.

1.c. Company Highlights

2. Verrica Pharmaceuticals' Q3 2025 Earnings: A Strong Foundation for Future Growth

Verrica Pharmaceuticals reported total revenue of $14.3 million for the third quarter of 2025, a significant improvement compared to a total negative revenue of $1.8 million in the third quarter of 2024. The company's net YCANTH revenue reflects shipments to its distribution partners, offset by standard gross to net adjustments. Gross product margins for the quarter were 79.1%, with a cost of product revenue of $0.8 million. The company's EPS came out at $0.13, beating estimates of -$1.14. Research and development expenses were $2.2 million, relatively in line with the same quarter last year.

Publication Date: Nov -29

📋 Highlights
  • YCANTH Commercial Growth:: 120% increase in dispensed applicator units to 37,642 for the 9 months ended September 30, 2025, compared to 2024.
  • Phase III Program Advancement:: Global Phase III trial for VP-102 (YCANTH) in common warts with Torii set to start later 2025, with patient dosing targeted for December.
  • Cash Position Strengthened:: $21.1 million in cash and equivalents as of September 30, 2025, boosted by $18M in 2025 milestones, including $10M in Q3 from Japan approval.
  • Revenue Surge:: Total revenue of $14.3M in Q3 2025 vs. negative $1.8M in Q3 2024, with 79.1% gross product margins.
  • Regulatory Momentum:: Positive FDA feedback for VP-315 (basal cell carcinoma) Phase III program, advancing the pipeline for oncology indications.

Cash Position and Funding

As of September 30, 2025, Verrica had aggregate cash and cash equivalents of $21.1 million. The company received $18 million in cash milestone payments in 2025, with $10 million received in the third quarter upon the approval of YCANTH for molluscum in Japan. This non-dilutive capital has helped support the company's cash position and YCANTH activities in the United States.

Commercial Progress and Pipeline Updates

The company's commercial product, YCANTH for molluscum, has seen growth in adoption by healthcare providers in the U.S., with quarter-over-quarter growth in dispensed applicator units of about 5%. Dispensed applicator units increased to 37,642 for the 9 months ended September 30, 2025, a 120% increase over the same period in 2024. Verrica has also made significant progress on its pipeline programs, including the advancement of its Phase III program for common warts and the presentation of new data on VP-315 at the SITC 40th Annual Meeting.

Valuation and Outlook

With a P/S Ratio of 2.8, the market is pricing in significant revenue growth for Verrica Pharmaceuticals. Analysts estimate next year's revenue growth at -28.5%. The company's ROE is 165.27%, indicating significant returns on equity. However, the EV/EBITDA ratio is -4.73, suggesting that the company's enterprise value is not yet justified by its earnings. As Jayson Rieger stated, "We will enter 2026 with significant accomplishments across all facets of our business in 2025 that I believe will lay the foundation for continued growth and success." The momentum seen in September is expected to continue, with the sales force expansion into pediatric primary care expected to drive growth in the first part of next year.

3. NewsRoom

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First Look: CME outage, Black Friday shifts, AI job impact

Nov -28

Source: gurufocus.com

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Market Today: Stocks Rally, Tesla Robotaxi and Nvidia Scrutiny

Nov -26

Source: gurufocus.com

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First Look: Campbell Soup fallout, Alphabet AI strength, Nvidia rebuttal

Nov -26

Source: gurufocus.com

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Verrica Pharmaceuticals Announces Private Placement Financing of $50 Million to Retire Debt and Extend Cash Runway

Nov -24

Source: globenewswire.com

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Verrica Pharmaceuticals Inc. (VRCA) Q3 2025 Earnings Call Transcript

Nov -17

Source: seekingalpha.com

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Verrica Pharmaceuticals Reports Third Quarter 2025 Financial Results

Nov -14

Source: globenewswire.com

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Verrica Pharmaceuticals Presents New Data on VP-315 from its Phase 2 Clinical Trial in Basal Cell Carcinoma at the 40th Society for Immunotherapy of Cancer Annual Meeting

Nov -10

Source: globenewswire.com

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Halper Sadeh LLC Encourages Verrica Pharmaceuticals, Inc. Shareholders to Contact the Firm to Discuss Their Rights

Oct -24

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (9.27%)

6. Segments

Novel Topical Solution of Cantharidin

Expected Growth: 9.27%

Verrica Pharmaceuticals Inc.'s novel topical solution of Cantharidin is driven by increasing demand for effective molluscum contagiosum treatments, growing awareness of skin health, and a rising pediatric population. Additionally, the solution's ease of use, minimal side effects, and potential for expanded indications contribute to its 9.27% growth.

7. Detailed Products

VP-102

A topical therapy for the treatment of molluscum contagiosum, a highly infectious and contagious skin disease that affects approximately 6 million people in the United States.

VP-103

A topical therapy for the treatment of common warts, a common skin condition caused by the human papillomavirus (HPV).

8. Verrica Pharmaceuticals Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Verrica Pharmaceuticals Inc. has a moderate threat of substitutes due to the presence of alternative treatments and products in the dermatology and medical aesthetics markets.

Bargaining Power Of Customers

Verrica Pharmaceuticals Inc. has a low bargaining power of customers due to the specialized nature of its products and the lack of buyer concentration in the market.

Bargaining Power Of Suppliers

Verrica Pharmaceuticals Inc. has a moderate bargaining power of suppliers due to the presence of multiple suppliers for raw materials and the company's dependence on a few key suppliers.

Threat Of New Entrants

Verrica Pharmaceuticals Inc. has a high threat of new entrants due to the attractiveness of the dermatology and medical aesthetics markets and the relatively low barriers to entry.

Intensity Of Rivalry

Verrica Pharmaceuticals Inc. operates in a highly competitive market with several established players, leading to a high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 68.80%
Debt Cost 8.71%
Equity Weight 31.20%
Equity Cost 13.02%
WACC 10.05%
Leverage 220.48%

11. Quality Control: Verrica Pharmaceuticals Inc. passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Cidara Therapeutics

A-Score: 4.2/10

Value: 6.8

Growth: 3.2

Quality: 5.4

Yield: 0.0

Momentum: 10.0

Volatility: 0.0

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Arcturus Therapeutics

A-Score: 4.2/10

Value: 8.4

Growth: 6.3

Quality: 4.2

Yield: 0.0

Momentum: 5.0

Volatility: 1.0

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ImmuCell

A-Score: 4.2/10

Value: 4.6

Growth: 3.0

Quality: 4.7

Yield: 0.0

Momentum: 10.0

Volatility: 2.7

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Taysha Gene Therapies

A-Score: 4.2/10

Value: 6.2

Growth: 4.9

Quality: 4.2

Yield: 0.0

Momentum: 9.0

Volatility: 0.7

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Verrica Pharmaceuticals

A-Score: 3.4/10

Value: 9.0

Growth: 3.7

Quality: 6.0

Yield: 0.0

Momentum: 0.5

Volatility: 1.0

1-Year Total Return ->

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Orgenesis

A-Score: 2.9/10

Value: 7.7

Growth: 4.2

Quality: 5.8

Yield: 0.0

Momentum: 0.0

Volatility: 0.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

8.42$

Current Price

8.42$

Potential

-0.00%

Expected Cash-Flows