Important things noted from your post.

My observations though:
We know that "skin cream market is large" - but to break into a good revenue from this market you need to work "with" the distributors and not "against" them. We need to see how and which distributors PHMD management get to. Margins asked and paid in such an agreement would define how much of profit (or loss) PHMD makes in the upcoming quarter.

What I found is that, a basic shift in the buying pattern is going on in the US consumer "skin cream" market. People are moving away from branded high-priced items to mid-range proven solutions. For example online proactive is going to announce 20 to 30 percent higher revenue than the nearest "branded" competitor. If PHMD management (and particularly the sales team) works towards it, i think they can get to a "better" revenue in this product segment.

Gosh, I feel we should buyout 20% of this scrip and promote our-self to the board, such that we can "help them" to get some market/segment insights. Don't really like bashing, blaming or pointing-fingers at them.

Again its all our opinion.
Take care and have a nice day.